The barriers to exporting Korean sunscreens to the U.S. have significantly increased. Although there have been reports of strong sales in the U.S. market, companies are becoming increasingly concerned with the implementation of the Modernization of Cosmetics Regulation Act (MoCRA).
There are several reasons for this: differences in regulations between countries regarding sunscreens, risks faced by manufacturers, and the difficulty in differentiating new products are among the key issues.
On July 2nd, the Korea Cosmetics Association hosted a webinar on “U.S. OTC Sunscreen Regulations,” which was attended by over 280 participants. More than 40 questions were submitted both before and during the webinar, with companies expressing concerns about FDA regulations and label requirements. The webinar was led by Carl D’Ruiz, a sunscreen expert from the Personal Care Products Council (PCPC).
Here are some of the key questions and their answers:
Question: It's said that the cost of OTC registration is about $50,000 per product. Is this cost the same for all products, or does it vary?
Answer: The FDA's OTC facility registration fee is fixed and it is per facility, but additional fees imposed by manufacturers can vary.
Question: Is OTC registration mandatory for sunscreens when exporting to the U.S.? If not registered, is export completely impossible? What about products sold on Amazon?
Answer: OTC registration is mandatory. Amazon also follows this standard, making it difficult to sell unregistered products.
Question: If U.S. consumers purchase products through direct overseas shipping, and these products are developed based on Korean ingredient standards and are not OTC registered, have there been any cases of rejection or sales suspension at U.S. customs? Would the manufacturing facility face penalties even if unaware of these direct purchases?
Answer: There could be issues at customs, and the FDA may detain or destroy such products. Additionally, the manufacturing facility may be penalized.
Question: What are the disadvantages of selling sunscreen products as general cosmetics rather than OTC drugs? If organic sunscreen ingredients are included and the product does not claim any sunscreen efficacy (e.g., SPF, Sunblock) on the label or detail page, can it be sold as a general cosmetic?
Answer: If sunscreen efficacy is not claimed, it can be sold as a general cosmetic, but FDA approval may still be required depending on the specific ingredients used.
Question: For a cushion compact containing sunscreen ingredients, if OTC registration is required, do all colors need to undergo separate OTC testing, or is one product test sufficient?
Answer: The FDA requires separate SPF testing for each formulation. Therefore, different colors may require individual tests.
These questions highlight the major concerns for brands and manufacturers. Entering the U.S. market without proper preparation could result in loss of trust in Korean cosmetics or significant financial losses, and even exclusion from the market.
When exporting sunscreens to the U.S., OTC registration is essential, and label compliance must be carefully managed. The U.S. classifies sunscreens as over-the-counter (OTC) drugs and only allows the use of 16 ingredients approved by the FDA.
All products with SPF and PA values displayed on the label must be OTC registered, and this requirement is increasingly being enforced on online platforms like Amazon.
Companies need to prepare for these regulations. Failure to comply could make exports impossible. Additionally, the FDA requires separate SPF testing for each product formulation.
While Korean sunscreens are gaining global popularity, stricter standards must be met to enter the U.S. market. This will likely require more time and resources for product development.
The OTC Monograph User Fee Act (OMUFA), which has been in effect since 2021, has raised the entry barriers for manufacturers. Under this act, the FDA requires OTC drug manufacturers to pay annual facility registration fees. For FY2024, manufacturers conducting their own production must pay $34,166, while contract manufacturers must pay $22,777.
These fees are increasing annually, and facility registrations must be renewed each year.
As a result, entering the U.S. market with sunscreens has become much more challenging. If an OTC-unregistered product is currently being sold in the U.S., it may have simply not yet been penalized by the FDA. However, if caught, it could severely impact the manufacturer’s operations.
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