Blog | G2 Risk Solutions

Navigating the Cognitive Frontier: Nootropics and Payments Risk

Written by G2 Risk Solutions | Mar 21, 2024, 4:00:00 PM

Does your portfolio include merchants who peddle “nootropic” supplements? If yes, then this blog post is for you! “Nootropic” is an industry term for products believed to enhance cognitive function—including memory, attention, intelligence, and decision-making. Nootropics are often referred to as “smart drugs,” “cognitive enhancers,” and “brain boosters.” They are frequently sold online via marketplaces, research chemical sites, nutraceutical websites, and websites that specialize in nootropics. These products are frequently marketed towards college students, athletes, and older adults.

In the United States, many nootropics are labeled as dietary supplements and contain common—and permissible—dietary supplement ingredients, such as caffeine and ginkgo biloba. Others, however, contain ingredients that have been flagged by the FDA as impermissible in dietary supplements, such as, phenibut and picamilon. The FDA has issued warning letters to companies that sell products containing these ingredients. The Department of Justice has also prosecuted merchants that sell these illegal ingredients. In fact, just last month, the DOJ sentenced a nootropics company and its CEO after finding them guilty of selling unapproved drugs.

The FDA and FTC have also issued warning letters to companies that market nootropics with impermissible claims. For example, in 2019, the agencies issued a joint warning letter to a nootropic website for marketing their products with claims such as, “Helpful in reducing symptoms of cognitive decline” and “Great for brain injury recovery.”

Outside the United States, many common nootropic ingredients are classified as prescription-only drugs or even controlled substances. International regulators have taken action against sellers of these ingredients. For example, the UK’s Medicines and Healthcare products Regulatory Agency reported a massive seizure of nootropic drugs. In its press release, the Agency noted: “While it is not illegal to possess these medicines, sale and supply of a prescription-only or unlicensed medicine is an offense in this country.” The Australian Therapeutic Goods Administration also fined an individual for unlawfully importing armodafinil, a nootropic ingredient.

When onboarding merchants that sell nootropics, it is important to make sure that they are operating legally in all jurisdictions where they offer shipping. Here is a list of “nootropic” ingredients that are: (1) commonly sold online; and (2) restricted or prohibited for sale in one or more countries.

5-HTP (also known as 5-hydroxytryptophan and oxitriptan)

5-HTP is often derived from Griffonia simplicifolia seeds. It is commonly—and legally—sold as a dietary supplement in the United States. However, it is considered a “novel food” in the European Union. Under EU regulations, any food that was not consumed “significantly” prior to May 1997 is “novel” and cannot be placed on the EU market. A company that wishes to place a novel food on the EU market must submit an application to the European Commission. The European Food Safety Authority then carries out a safety assessment.

  • European Union: 5-HTP is a novel food regardless of whether it is chemically synthesized or selectively extracted from Griffonia simplicifolia seeds. Before 5-HTP may be placed on the market, a safety assessment under the Novel Food Regulation is required.

  • Germany: 5-HTP is aprescription-only ingredient.

DHEA (also known as dehydroepiandrosterone and prasterone)

Although DHEA is a permitted—and common—dietary supplement ingredient in the United States, it is restricted for sale in many countries, including:

DMAE (also known as dimethylaminoethanol and deanol)

DMAE is a permitted and common dietary supplement ingredient in the United States. However, its sale is restricted in a number of countries, including:

Kava (also known as kava kava and Piper methysticum)

Kava is restricted in several countries, including:

Levodopa (also known as l-dopa)

Levodopa is restricted for sale in many countries, including:

Melatonin

This ingredient is a permitted—and common—dietary supplement ingredient in the United States. However, it is restricted for sale in many other countries, including:

  • Australia: Melatonin is a Schedule 4 prescription-only ingredient, except when sold as either: (1) a modified release tablet containing 2 mg or less of melatonin for monotherapy for the short-term treatment of primary insomnia characterized by poor quality of sleep for adults aged 55 or over, in packs containing not more than 30 tablets; or (2) immediate release preparations containing 5 mg or less of melatonin for the treatment of jet lag in adults 18 years and over, in a primary pack containing no more than 10 dosage units. For both of these exceptions, melatonin must be sold by a pharmacist.

  • Denmark: Melatonin is prohibited in supplements.

  • Germany: Melatonin is a prescription-only ingredient.

  • Ireland: Melatonin is a prescription-only ingredient.

  • Italy: Food supplements are prohibited from offering a daily dosage of melatonin greater than 1 mg.

  • New Zealand: Melatonin is a prescription-only ingredient, except when supplied in medicines for oral use containing 3 milligrams or less per immediate release dose unit, or 2 milligrams or less per modified release dose unit. These dosages must be provided by a registered pharmacist.

Modafinil

Modafinil is often sold online as Waklert, Modvigil, Modalert, Modawake, and Vilafinil. It is restricted for sale in many countries, including:

N-Acetyl L-Cysteine (also known as N-acetyl cysteine, acetylcysteine, and NAC)

In 2022, the FDA announced that it intended to exercise “enforcement discretion” with respect to the sale and distribution of certain NAC-containing dietary supplements. Therefore, this ingredient is currently permitted in supplements in the United States, provided that the supplements meet the criteria set forth by the FDA.

Phenibut

Phenibut is also known as fenibut, phenigam, PGaba, PhGaba, Phenibut HCl, Phenigamma, Phenygam, Phenylgam, Phenyl-GABA, 4-amino-3-phenylbutanoic acid, β-(aminomethyl)benzenepropanoic acid, beta-(aminomethyl) hydrocinnamic acid, and β-phenyl-γ-aminobutyric acid. It is restricted in many countries, including:

Picamilon

Picamilon is also known as pikatropin, pikamilon, nicotinyl-gamma-aminobutyric acid, and nicotinoyl-GABA.

Piracetam

Piracetam is restricted for sale in several countries, including:

Tianeptine

Tianeptine is also known as tianeptine sulfate, tianeptine sodium powder, tianaa, tianna green, tianna red, tianna white, and “gas station heroin.” The FDA has reported “severe adverse events” involving products containing tianeptine, including seizures, loss of consciousness, and death. Its sale is restricted in many countries, including:

Vinpocetine

Vinpocetine is also known as ethyl apovincaminate, common periwinkle vinpocetine, lesser periwinkle extract, and vinca minor extract. Although the FDA has published tentative conclusions that vinpocetine is impermissible in dietary supplements, the agency has not finalized these conclusions. In other countries, however, vinpocetine is prohibited for use in supplements. Examples include:

Yohimbine

Yohimbine is derived from the bark of the Pausinystalia yohimbe tree. It is frequently included as an ingredient in sexual enhancement supplements. Although yohimbine is a common—and permitted dietary supplement ingredient in the United States, its use is restricted in many other countries, including:

Have questions about the nutraceutical merchants in your portfolio? Contact us.
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