FDA CDER and OCS Sign Agreement for Joint Regulation of Dual-Classification Products (Cosmeceuticals)
Agreement for Consistent Regulation
The FDA's Center for Drug Evaluation and Research (CDER) and Office of the Chief Scientist (OCS) have signed an Intercenter Agreement (ICA) to jointly oversee dual-classification products (cosmeceuticals) that possess characteristics of both drugs and cosmetics. This agreement aims to clarify roles and information-sharing systems within regulatory agencies following the implementation of the Modernization of Cosmetics Regulation Act (MoCRA). It serves as an administrative framework to prevent regulatory actions being taken unilaterally by either office without prior notification. This will ensure a more consistent and comprehensive evaluation of the safety and efficacy of products in this gray area.
Clarifying the Boundaries of Cosmeceuticals
With the increasing development of functional cosmetics using biotechnology-based ingredients, the distinction between simple cosmetic products and drugs has become blurred, leading to a rise in borderline products. Examples include anti-dandruff shampoos, fluoride-containing toothpastes, and sunscreens, which, under U.S. law, meet the requirements of both cosmetics and drugs. When regulatory authorities internally review the toxicological effects and functional safety of these ingredients, a lack of standardized criteria and coordination between departments has led to delays in market release. This agreement will provide consistent regulatory standards for these dual-classification products, significantly reducing unnecessary administrative burdens for companies.
Scientific Review to Address Market Expansion
The U.S. market for functional cosmetics is currently valued at approximately $16.2 billion in 2025 and is projected to reach up to $92 billion by 2035, with an annual growth rate of 7-9%. In line with this, the scientific analysis capabilities of the OCS's Office of Cosmetics and Colors (OCAC) will be combined with CDER's drug review expertise to rapidly develop more sophisticated guidelines based on ingredient safety data. Clear, science-based criteria will contribute significantly to ensuring consumer safety by preventing the use of unverified and potentially harmful ingredients in the long term. For bio-beauty companies seeking to introduce new technology-based ingredients, this will provide a transparent roadmap for conducting research and development (R&D) in accordance with rigorous standards.
Changes in Corporate Regulatory Response Costs and Strategies
Manufacturers now face the challenge of considering the stricter MoCRA compliance requirements, including facility registration, product listing, and serious adverse event reporting, in conjunction with the joint regulation by CDER and OCS. As a result, internal compliance and analysis costs for cosmetic manufacturers and brands are likely to increase significantly in the short term. However, as uncertainty in the approval process due to inter-departmental discrepancies is resolved, there is also the advantage that, in the long term, the predictability of developing products and obtaining regulatory approvals will be greatly improved. Companies should seek strategic changes to proactively build clinical validation data at the drug level from the early stages of R&D.
This CDER-OCS joint regulatory agreement (ICA) signals the introduction of stringent, drug-level safety standards to the U.S. functional cosmetics market, which is expected to grow from $16.2 billion in 2025 to up to $92 billion in 2035. In the short term, this will accelerate the elimination of small-brand companies that lack the infrastructure to meet regulatory requirements, particularly in terms of product registration and ingredient safety verification costs. In the medium to long term, it will further solidify the market dominance of global beauty giants such as Estée Lauder (EL) and L'Oréal (OR), which possess systematic R&D and safety verification infrastructure. From the perspective of researchers and bio-venture companies, this requires a shift in the development paradigm, where high-functionality new materials, such as synthetic biology or skin-regenerating peptides, must proactively secure drug-level toxicity analysis and Phase 1-level safety data during the commercialization process, rather than being treated as simple cosmetics. As a result, the success of R&D and investment attraction in the bio-beauty field will depend on the ability to identify and control the risk of concurrent jurisdiction by U.S. regulatory authorities early on.