What a seal of approval doesn't mean: nonprofit groups claim they're not endorsing products that display their logo

Kiplinger's Personal Finance Magazine, Feb, 1998 by Jane Bennett Clark

You're shopping for a blood-pressure monitor and you've narrowed the choice to two products. One bears the logo of a respected nonprofit health organization. The other, while a little cheaper, has no seal. Which do you buy?

Perhaps you'd spring for the one with the seal, figuring that the organization's name on the product means the group has tested and approved it. Not so fast.

Most groups don't conduct independent testing or reviews. Still, nonprofit groups are linking their names to for-profit corporations in arrangements that range from local fund-raising events to million-dollar marketing partnerships. Although the nonprofits say that such deals don't constitute endorsements, consumer advocates are more blunt. "The reality is that organizations do endorse products," says Mike Donio of the People's Medical Society. "When doctors say things, people listen."

Sometimes the seal-for-sale strategy backfires. In a highly publicized event last summer, the American Medical Association and the Sunbeam Corp., an appliance manufacturer, announced that Sunbeam would have the exclusive right to use the AMA name and logo on its health products in exchange for giving the doctors' group a percentage of gross sales and including educational material in the product packaging. Almost immediately, criticism by doctors, consumer advocates and the media led the AMA to cancel the plan. Sunbeam has since sued for $20 million. WHAT'S BEHIND THE SEALS. Most nonprofits have guidelines for entering into partnerships, which attempt to match products to the group's mission. Some groups have stricter standards than others. Here's what to expect when you see each of these prominent organizations' seals on a product or in other associations with a company:

* In lending its name to the Nicoderm patch and Nicorette gum, the American Cancer Society relies on the Food and Drug Administration's approval of nicotine replacement as a quit-smoking strategy. An independent evaluation of products "would get us into the whole world of product endorsement," says spokesman Steven Dickinson. "We're not saying one product is better than another." The society says it gets up to $5 million a year worth of marketing from the manufacturer, Smith Kline Beecham, for its antismoking message, on top of a no-strings-attached $1-million-a-year donation.

* The American Dental Association tests or reviews products itself. It rejects about 30% of the products submitted for approval, but now lends its seal to about 400 consumer products. The ADA has evaluated dental products since 1930, using its own scientists as well as outside consultants. Manufacturers pay a fee when they submit products for testing, as well as an annual fee. The program is not a money-maker for the ADA, which says fees cover only about 30% of the cost of testing.

* Stroll down the cereal, frozen-food or dairy aisle and you'll find the check-mark logo of the American Heart Association abundantly evident. The association receives a fee of $2,500 for each of the hundreds of products it certifies, plus $25,000 to $200,000 for use of its name in promoting products. Rather than testing them itself, it requires that each meets FDA criteria for foods making a coronary health claim, and it won't okay any foods manufactured by a tobacco company (Kraft, for instance, falls under the umbrella of Philip Morris). The association also receives royalties on sales of CPR aids, cookbooks and videos that it has evaluated and licensed under its name.

* The American Lung Association recently embarked on a two-year partnership with McNeil Consumer Products, maker of the Nicotrol patch, for which McNeil has contributed $4.5 million to antismoking programs. The ALA distributes a quit-smoking self-help manual and other literature that includes details about Nicotrol and its partnership with the ALA. It relied on the FDA to vet the patch but says discussions with McNeil also provided assurances that the company's quit-smoking strategy, which includes behavior modification and nicotine replacement, was compatible with that of the association. MUDDYING THE WATERS. Corporate partnerships provide not only money but also a platform for public health campaigns, say the nonprofit groups. Still, critics suggest both message and mission are weakened by financial arrangements tied to the success of a particular product.

Many of these arrangements present "a strong conflict of interest," says Arthur Levin of the Center for Medical Consumers, in New York City. "When you get into direct partnerships around specific medicines, what it does is muddy the waters. If the nonprofit is going to have a direct financial benefit for the sales of a specific product, how in the world can it be critical of that product?"

Says Donio of the People's Medical Society: "Consumers should exercise the same caution and skepticism they would in purchasing any product or service." t least it g