June 18 (Bloomberg) -- Matrixx Initiatives Inc. said today it didn’t turn over to U.S. regulators 800 consumer complaints about side effects linked to its withdrawn Zicam nasal spray and swabs.
Matrixx, based in Scottsdale, Arizona, stopped selling the cold remedies on June 16 after the Food and Drug Administration warned consumers the treatments may cause a loss of smell. Matrixx today defended its products and called the FDA warning “a surprise,” during a conference call with analysts.
The FDA found 800 reports of consumer concerns in May during a routine inspection, William Hemelt, acting president and chief operating officer of Matrixx, said today during the call. Hemelt said he was told by lawyers that a 2007 regulation requiring companies to turn over reports of serious side effects didn’t apply to the complaints received by Matrixx. The recall will cost the company $10 million and will increase its product liability costs, he said.
“We have complaints but we weren’t required to send them,” Hemelt said. “At least we didn’t believe we were required to send them and we based that on an opinion of counsel who looked at the FDA regulation and said no, it doesn’t fit.”
The FDA said June 16 that it had received 130 reports from doctors and consumers about permanent loss of smell linked to the medicines. FDA spokeswoman Siobhan DeLancey said in a June 16 telephone interview that Matrixx was required to turn over reports of side effects to the FDA according to the 2007 regulation.
The company today withdrew its earnings and sales forecast for 2010.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aABaipe0smcABEGIN TRANSCRIPT
RUSH: Jackson, Michigan, Ann, welcome to the EIB Network. Hello.
CALLER: Hi, Rush.
RUSH: Hi.
CALLER: I want to thank you and Zicam for saving my book tour and my life.
RUSH: Saving your book tour and your life, Zicam?
CALLER: Absolutely.
RUSH: How did that happen?
CALLER: Well, I have sarcoidosis, which is the same lung disease that Bernie Mac had when he died. I also am the author of children's books and recently I was on a two-week book tour of elementary schools when I started catching a cold. I took Zicam, which I had never taken in my life, and actually have always thought that you're ads for it were really hooey, you know. I never believed that it would work.
RUSH: Did you send me an e-mail last night?
CALLER: I sure did.
RUSH: Because I read your e-mail and I was going to print it out and bring it in for the next time I had to record a Zicam commercial, and when you used the word hooey I remember reading your e-mail because you thought -- and, by the way, I was profoundly insulted, because here you are, regular listener, telling me you think I'm lying to you about things. And so you thought Zicam was a bunch of hooey.
CALLER: I did. I really did. Until I needed it, and I used it because of my disease and my compromised immune system, I cannot catch a cold. And I go into elementary schools all the time to do presentations for my books, and so I want to say thank you. I want to tell you how wrong I was and how much I appreciate the product. I also have a lot of trouble with public speaking. I cough a lot of because of my disease, and in fact right before I came on air with you, I took Zicam Cough Max, and that works just wonderfully.
RUSH: (laughing) Zicam Cough Max.
CALLER: I did.
RUSH: I hope you took the daytime formula.
CALLER: Absolutely.
RUSH: So it wouldn't make you sleepy.
CALLER: Yeah. Yeah. And I've used it a lot for public speaking.
RUSH: Well, that's just great. I have one question.
CALLER: Uh-oh.
RUSH: No!
CALLER: I'm fearful of your questions.
RUSH: No, no, no. Don't be fearful. You think the product is hooey, you hear me talk about Zicam and what do I say? I say if you think you're catching a cold, use it the minute you think so, you got to catch it early. It may not stop it, but it will certainly slow it down and shorten the duration. Why did you try it if you thought it was hooey?
CALLER: Because I was desperate. I've never been away from home for two weeks, and I had signed a contract to do a two-week book tour of elementary schools. And I happened to hear you 48 hours before I was to leave on my book tour, and your advertising it, and I went to the store, and I thought, you know, this thing probably doesn't work, I'm probably not going to need it, but I took it anyway, and I'm really, really glad that I did. I'd like you to allow me to return the favor. I'd like to send you a signed copy of my children's book Christmas Tree Farm for your nieces and nephews.
RUSH: Wow, that's very nice. If you'll stay on hold, Mr. Snerdley will give you the details on how to do this.
CALLER: Okay, thanks so much, Rush.
RUSH: Ann, thank you very much. What it means is you never did think it was hooey because if you thought Zicam was hooey you would have never even tried it.
CALLER: Well, that's probably true.
RUSH: All right.
CALLER: Thank you so much, Rush.
RUSH: Same here. Appreciate it.
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