Not just a cosmetic problem
BACKGROUND REPORT: Internet has led to a surge in dodgy beauty, weight loss products, with few FDA controls
Owning cosmetic brands and supplementary food products in Thailand was once attainable only for established cosmetic and pharmaceutical companies.
Currently, individuals with a knack for on-line marketing and 100,000 baht of cash in hand can own a brand of cosmetics or food supplement.
"With less than 100,000 baht, you can become the owner [of cosmetic brands or food supplement]. Thanks to the internet and smartphones, anyone can trade and sell these products online and make money," said Nakah Thawichawatt, president of the Thailand Health and Beauty Confederation.
Mr Nakah said he had witnessed young entrepreneurs entering the market and getting rich. These entrepreneurs do not have to invest in their own factories or laboratories to research their products. There are factories in place which can make products for them. These investors mostly take care of packaging and marketing for their goods.
Mr Nakah also runs a local factory manufacturing food supplements for local brands. He said the number of his clients has increased from 50 to 100 brands in half a decade.
The value of local investment in the cosmetics industry alone in 2016 was 7.66 billion baht. About 70% of players in the market are small and medium enterprises. The average yield is more than 5% annually, according to the Department of Business Development, Ministry of Commerce.
But the industry's negative side was unveiled early this month when police arrested eight people from a company for selling cosmetics and food supplements under the Magic Skin brand.
- Main report: Blitz at Don Mueang
They were arrested for selling products which contain illegal and sub-standard materials. Police also found their products used fake FDA certificates.
The Anti-Money Laundering Office (AMLO) is inspecting the Magic Skin company's transactions. Police have also summoned 56 celebrities who were paid to endorse these products.
The case is just the tip of iceberg. Early this week, the authority also arrested the owner of the company producing Lyn weight reduction pills, after at least three people died this month after taking weight loss pills.
Lyn product also used a fake FDA certificate. This week, police also raided a market near Don Mueang airport and seized a huge number of illegal products.
Recent incidents have hurt the image of local cosmetic and food supplement brands. Mr Nakah begged the public to understand that not all companies in the industry are unscrupulous. "The problem concerns a few bad apples and the challenge is how to control or limit those illegal products," he said.
Mr Nakah admitted fake and sub-standard products have been a major problem for the industry. He said the FDA once held random checks a few years ago and found samples of local cosmetics products and food supplements contained substandard ingredients.
The FDA is responsible for granting licences and inspecting products' quality.
In reality, Wanchai Sattayawuthipong, FDA's secretary-general, admitted it is impossible for the agency to have regular product checks, because of manpower shortage.
Currently, there are 700,000 cosmetic items and 30,000 food supplements which carry FDA certificates.
Meanwhile, the agency has to deal with around 600 requests for FDA guarantee certificates for cosmetics and food supplements each day. There are about 18 staff working on product and licence registration. Only eight staff are in charge of random product checks.
The reason that requests come in such big numbers is the FDA regards cosmetics as relatively safe products, so lets product owners file requests in electronic form.
If there is no prohibited substance or chemical in the submitted lists of ingredients, the FDA is likely to grant licences in less than a month.
According to the FDA's figure, the number of products licensed as cosmetics and food supplements leapt from 4,168 in 2011 to 13,907 products in 2015. "We understand the customers are worried. But please keep in mind that FDA licences have contributed to confidence for both local and foreign markets for a long time," he said.
"The recent problem concerns the way the market has expanded to the level that it is impossible for us to monitor. More and more illegal products are also being found," Dr Wanchai said.
The agency is now pledging to reform. The ministerial regulation on cosmetic products is to be revised to impose stiffer penalties. The agency will also require brand owners to supply lists and permits of manufacturing plants, he said.
While society is pointing a finger at unscrupulous owners and the FDA, Saree Ongsomwang, secretary-general of the Foundation for Consumers, urged consumers to develop their own self-awareness.
The number of complaints concerning beauty and health products reached 885 complaints last year out of a total of 3,615 complaints, 25% up in one year. Most involved with exaggerated advertising.
The FDA alone wouldn't be able to deal with illegal products, Ms Saree said.
"It requires cooperation of all sectors, especially from provincial level to deal with such cases. The provincial public health office is the key to drive inspections," she said.
For example, the raid on the Lyn factory stemmed from an investigation carried out by provincial public health officials in Chon Buri province. "If all provincial officials keep an eye on issues and carry out an investigation, we will see more improvement," she said.
The FDA, she said, should focus on probing false and exaggerating advertisements and educating consumers. On May 3, the National Broadcasting and Telecommunications (NBTC) and FDA launched a campaign to monitor advertisements for food supplements and cosmetics that are not approved and have them taken off air.