Welcome to O ur October Webinar For Nature’s Sunshine Consultants

2. Welcome to Our October Webinar ForNature’s Sunshine Consultants October 20, 2011 Keeping You Safe – A Conversation with Nature’s Sunshine’s Attorney

3. My Contact Information Scott Terry scottt@natr.com P 801-342-4516 F 801-342-4579 75 E. 1700 S. Provo, UT 84606

4. This webinar will be recorded and can be viewed on www.nspwebinars.com A phone recording of this webinar is available by calling 1-712-432-0453 PIN 1384998 (This is not a toll-free call)

6. New Corporate HeadquartersAugust 2012

7. New Corporate HeadquartersAugust 2012

8. Education Week! • November 14-21 • 11 am & 6 pm Live Mountain Time; • Recordings will be provided as well • Six free webinars • Product discounts & specials • Lots of fun giveaways on live sessions • www.nspwebinars.com

9. Enter your questions, we’ll address them when we conclude What topics would you like to see discussed on our future consultant webinars?

10. Jamon Jarvis Executive VP-General Counsel, Chief Compliance Officer

11. Claims, Pains & Regulations:An Introduction to the Regulation ofDietary Supplements Jamon Jarvis General Counsel & CCO Nature’s Sunshine Products, Inc.

12. Purpose • Cover the Basics • Who Regulates • Define the Terms • Claims • Why Do “They” Care? • Why Should We Care? • Practical Application • Questions?

13. Who are the Regulators? FTC FDA • Regulates over $1 trillion worth of consumer products • Approximately 25 cents of every dollar spent by consumers • Promote and protect the public health • Guiding principles: Products must be safe, clean, wholesome, produced and stored in sanitary conditions, and truthfully labeled • Priorities include dietary ingredient/supplement safety • The Nation’s Consumer Protection Agency • Act to prevent fraud, deception and unfair business practices • Joins with FDA on dietary ingredient/supplement consumer issues

14. Dietary Supplement Health andEducation Act of 1994(DSHEA) DSHEA Definition

15. Dietary Supplement Health andEducation Act of 1994(DSHEA) • Background and Overview • Why? • Defines a dietary supplement • Reverses burden of safety • The role of “third-party” materials

16. Dietary Supplement Health andEducation Act of 1994(DSHEA) • Key Requirements • New Dietary Ingredients • FDA Disclaimer created • Structure/Function Statements

17. Claims and Substantiation What Can I Say?

18. Permitted Claims • Structure/Function Claims • Structure/Function claims describe the role of a nutrient or dietary ingredient intended to affect normal structure or function in humans • Function v. Dysfunction • Nutrient Content Claims • Describe the level of nutrient or dietary substance in a product (using terms such as “free,” “high” and “low”) • Compare the level of a nutrient in a food to that of another food (using terms such as “more,” “reduced” and “lite”)

19. Permitted Health Claims(Continued) • Health Claims • Describe a relationship between a dietary supplement ingredient and a reduction in the risk of disease or health related condition (can be used if certain criteria are met) • Health claims based on authoritative statement of a scientific body of the U.S. Government, after FDA’s review of scientific evidence • Qualified health claims supported by credible evidence and accompanied by a non-misleading disclaimer

20. Permitted Health Claim Example Calcium, Vitamin D, and Osteoporosis: Adequate calcium and vitamin D throughout life, as part of a well-balanced diet, may reduce the risk of osteoporosis. Complete List: http://www.fda.gov/Food/GuidanceComplianceRegulatoryInformation/GuidanceDocuments/FoodLabelingNutrition/FoodLabelingGuide/ucm064919.htm

21. Disease Claims • Generally Not Permitted - • Dietary supplements, in general, are not permitted to be marketed as a treatment, prevention or cure for a disease or condition • Dysfunction v. Function • Very limited exceptions

22. What is a Structure/Function Claim? • DSHEA • Describes role of nutrient or ingredient intended to affect the normal structure or function in humans • Characterize the documented mechanism by which a nutrient or ingredient acts to maintain such structure or function • Describes general well-being from consumption of nutrient or ingredient • Function v. Dysfunction

23. When is a Structure/Function Claim Allowed? • Manufacturer has substantiation that statement is truthful and not misleading • What qualifies as substantiation? • NSP’s Responsibility • Mandatory disclaimer included • “This statement has not been evaluated by the Food and Drug Administration. This product is not intended to diagnose, treat, cure, or prevent any disease.”

24. Permissible Structure/Function Claim Examples • Pain associated with non-disease states, e.g., muscle pain following exercise • Supports a normal, healthy attitude during PMS • Helps support cartilage and joint function

25. Testimonials • Distributor product testimonials – restrict claims to those similar (if not identical) to the claims contained on the product label and brochures • Testimonials from doctors and scientists – no difference • To be considered substantiation, must meet same standards • If not proven via scientific research contemplated by the substantiation requirements, don’t say it in testimonials • Can testimonials be used? • Yes, if they do not make drug/disease claims • If they are not false or misleading • If they express product attributes such as taste, quality or nutritional content

26. Third-Party Literature • Cannot be false or misleading • Does not promote a particular manufacturer or brand of dietary supplement • Does not have appended to it any information by sticker or any other method • Can be a publication, including an article, a chapter in a book, or an official abstract of a peer-reviewed scientific publication • Reprinted in its entirety • Can be used in connection with the sale of a dietary supplement to consumers

27. Practical Examples(Indications and acceptable/unacceptable claims) Wrong Right • Blood Pressure – Lowers • Cholesterol – Lowers • Blood Sugar (Diabetes) - Controls • Joints - Pain • Sleeplessness – Insomnia • Stomach – Duodenal lesions/Bleeding • Blood Pressure – Maintains normal range • Cholesterol – Maintains normal range • Blood Sugar - Maintains normal levels • Joints – Joint function/cartilage • Sleeplessness – Occasional • Stomach – Upset/Sour

28. Practical Examples(Indications and acceptable/unacceptable claims) Wrong Right • Acne – Cystic • Pain – Analgesic • Sex- Restores Potency • Heartburn – Relief of • Inflammation – Anti-Inflammatory • Memory – Alzheimer’s/Dementia • Calcium – Osteoporosis • Immune - Wasting/AIDS • Acne – Non-cystic • Pain – Muscle (after exercise) • Sex – Sexual Desire • Heartburn – Occasional • Inflammation – Inflammation Response • Memory– Mild (Aging) • Calcium – Helps Build Strong Bones • Immune – Supports the immune system

29. Practical Examples(Indications and acceptable/unacceptable claims) Wrong Right • Eyes – Glaucoma • Constipation - Chronic Constipation • Weight Loss – Obesity • Hair Loss – Alopecia • Mood - Herbal Prozac/Depression • Flu Season • Eyes – Presbyopia (Focus/aging) • Constipation – Occasional - Laxative • Weight Loss – Appetite Suppressant • Hair Loss - With Aging • Mood – Relaxed Feeling • Seasonal Changes

30. Key Take-Aways • NSP’s Policy: Actively market and promote NSP’s products within the current regulatory and legal framework, pushing for legislative change where appropriate. • Any disease claim, with rare exception, regarding a dietary supplement is prohibited. • Health Claims, structure/function claims, testimonials and third party literature can be valuable sales and marketing tools when used within regulatory limits. • Unauthorized, unsubstantiated claims can lead to regulatory problems for the Company and its distributors. • Education and corporate vigilance protects the Company and its distributors.

31. Thank You Jamon!

32. Questions & Answers

33. Thanks Everyone! Next consultant webinar is scheduled for Tuesday, November 22nd