Numico says settlement reached in ephedra cases
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Dutch food group Numico NV said on Monday it had reached a tentative settlement in 36 cases concerning the food supplement ephedra, sold by its former GNC unit before it was banned in the United States.
Numico, Europe’s largest maker of baby formula, said that a group of defendants in the cases had agreed to pay $19.7 million and that its own portion of those costs was covered by product liability insurance.
The supplement, used to promote weight loss and enhance sports performance, was banned in 2004 by the U.S. Food and Drug Administration, citing concerns about an “unreasonable risk of illness or injury”.
Ephedra is derived from the Chinese herb ma huang and has long been used as a treatment for asthma.
Numico said the agreement was part of a global settlement involving claims against some 20 defendants, including health food product chain GNC and other retailers. It is related to the sale of ephedra-containing products manufactured by Twin Labs.
The settlement is subject to definitive documentation and ultimate approval by the Bankruptcy Court as part of Twin Labs’ reorganisation plan, Numico said. If approved by the Court, it will result in the dismissal of 77 active cases, including 36 in which GNC is named as a defendant.
Numico sold GNC in October 2003. It now is a specialised nutrition company with leading positions in baby food and clinical nutrition with brand names such as Nutricia, Milupa and Cow & Gate.
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