What FDA’s Latest OTC Warning Letters Say About Common Failure Modes (And How to Close Them)
Three FDA warning letters posted on October 7 highlight recurring OTC gaps.
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In early October, the FDA posted three domestic OTC warning letters that together read like a primer on where OTC drug manufacturers are still falling short. They all cite problems we routinely see in our audits at OTC and other drug firms.
Naturich Cosmetique Labs (TX), Creative Essences (CA), and Dixon Investments Inc. dba ARI (GA) were each cited for serious lapses ranging from unvalidated water systems and missing process qualification data to skipped identity tests on high-risk ingredients and incomplete investigations into failed batches.
Read each of the warning letters here:
While the details differ in how the problems manifested at each site, the pattern is unmistakable: weak process validation, inadequate component testing, and superficial quality oversight continue to surface across small and mid-size OTC firms.
Taken together, these letters show how FDA’s expectations around validation, CAPA rigor, and quality unit authority are being enforced in practice—and where industry teams should be stress-testing their own systems before inspectors do.
Let’s take a closer look at these warning letters and pull some important lessons from them.
“State of control” is still the center of gravity
All three firms were cited for gaps that undercut a demonstrable, sustained state of control.
Process validation was the first dimension of the problem here.
Naturich hadn’t validated manufacturing processes and showed intra-batch potency variability (a sub-potent acne moisturizer lot and a super-potent SPF 30 lot that repeatedly failed testing) before release.
Creative Essences “lacked process validation data” for its OTC lines. Dixon had not performed process validation for OTC aerosol products—called out as a repeat violation.
Each letter reiterates that successful process qualification is needed before commercial distribution and must be followed by ongoing performance monitoring.
Stability was the other dimension. Dixon failed to follow an adequate written stability program and didn’t test enough batches per its own procedure (again, a repeat finding). Creative Essences had multiple OOS stability failures (pH, viscosity) on a released sunscreen lot and didn’t investigate adequately.
The FDA now wants to see documented validation programs with PPQ, intra-/inter-batch monitoring, equipment/facility qualification, and (where applicable) stability-indicating methods and annual program add-ins. In several places, the agency pointed companies to its process validation principles and its quality systems approach documents.
Our auditors routinely encounter “validation packages” that consist only of one-time engineering runs or incomplete protocols lacking predefined acceptance criteria. Small OTC firms often assume that because their products are “non-sterile topicals,” the same lifecycle rigor doesn’t apply. That misconception keeps recurring in inspections (and keeps showing up in our audit reports).
Treat process qualification (PPQ) as a data-driven study, not paperwork. Collect quantitative blend uniformity and fill-weight data and trend it over time.
Include intermediate hold times and worst-case mixing speeds in your validation runs. FDA reviewers now look for these stressors.
Until PPQ is complete, implement interim controls: batch-by-batch enhanced sampling, supervisory sign-off, and stability-trigger flags.
Use your annual product reviews to trend intra- and inter-batch variation. Many firms never convert PPQ data into ongoing monitoring metrics. Huge red flag during inspections.
Water systems and microbiology were chronic weak points
Two of the three letters flag water as a direct risk vector.
For Naturich, it was inadequate water system design/validation, maintenance, sanitization, and monitoring—despite using water in products “applied to irritated and potentially broken skin of infants.” FDA notes repeated microbiological out-of-limit results without adequate investigation, including recoveries of Enterobacter cloacae, Burkholderia cepacia, and Pseudomonas spp. The firm’s reliance on a “(b)(4) step” at elevated temperatures to justify product release was not accepted.
Inside Creative Essences, the FDA found multiple microbial OOS results from the water system and no evidence that microbiological method suitability was established for water or finished products. The FDA’s point: unverified or unvalidated methods may miss objectionable organisms in the product matrix.
The FDA asked for independent assessments of water system design and control, routine microbial monitoring with identification of isolates, appropriate alert/action limits, and thorough CAPA that addresses root cause—not just retesting or procedural platitudes.
In nearly a third of our recent OTC facility audits, purified-water systems operate at ambient temperature with no (or an inadequate) formal sanitization cycle and organism trending. Firms may rely on a “heat step” in the product process instead of controlling the utility itself—a rationale FDA rejected in Naturich’s case here.
Map every use-point and establish a sampling rotation that covers them at least quarterly.
Identify isolates—and don’t stop at total counts. Trending the species profile catches systemic biofilm issues early, but remarkably few firms do this.
Validate cleaning and sanitization frequency with data, not habit. A system that runs warm and idle over weekends is a red flag.
Confirm method suitability for each formulation. Preservatives and viscous bases often suppress recovery during testing.
Our teams also encourage firms to visualize water data using control charts reviewed weekly by QA. This single practice often detects drift months before it becomes an OOL. It’s a small addition that pays big dividends.
Identity testing of high-risk components is not optional
Naturich and Creative Essences failed to test each lot of high-risk raw materials—such as ethanol, glycerin, and propylene glycol—for methanol, diethylene glycol (DEG), or ethylene glycol (EG) contamination, relying instead on supplier COAs.
Drilling in deeper:
Naturich was cited for inadequate identity testing of incoming ethanol for methanol contamination and no proper identity testing of glycerin for DEG/EG. The FDA reminded the firm that contaminated alcohols/polyols have been linked to lethal poisonings and asked for retained testing and full risk assessments, with customer notification/recalls as needed.
Creative Essence also had inadequate identity testing for glycerin and propylene glycol (also high-risk for DEG/EG), as well as a reliance on COAs without establishing supplier reliability. The TDA requested DEG/EG results within 30 days, a material-system review, and a validated COA-reliability program.
We see quite a few smaller OTC firms that still believe supplier qualification exempts them from lot-specific identity testing. Our auditors often find methanol or DEG/EG tests listed in SOPs but not performed routinely (sometimes because the lab “never had a problem before”).
Follow USP parts A–C identity tests for alcohols and polyols on every incoming lot. Keep the chromatograms on file.
Re-qualify suppliers annually with side-by-side COA verification testing.
Retain reserve samples of raw materials for at least one year beyond product expiry—critical if retrospective testing is ever required.
Build a risk-based raw material matrix ranking by toxicity potential, not just historical defect rate; this makes QA review defensible during inspection.
Investigations, CAPA, and QU authority
Creative Essences failed to investigate multiple OOS and stability failures. Naturich limited its water OOL investigations to procedural notes. Dixon’s QU lacked oversight of batch release and CAPA. All three needed independent assessments of their investigation systems.
Our auditors often see that investigation templates are completed to close tickets, not to uncover root causes. Trending is manual or absent, so systemic issues go unnoticed. We still see CAPAs closed once a procedure is rewritten—without verifying behavioral change or effectiveness.