In His Own Defense
(page 1 of 4)Michael Ellis, cofounder and chief executive officer of Metabolife International Inc., is one of San Diego's most successful homegrown entrepreneurs. And one of its most controversial.
In just five years, his herbal weight-loss concoction has climbed to the top of the dietary supplement heap, earning a staggering $1 billion in revenue in 1999 and bringing Ellis great personal wealth. And he's not sitting on his money. Ellis, who a decade ago lived in a National City rental where he had to turn on the oven to heat the house, recently purchased a $1.9 million, 7,800-square-foot house in Rancho Santa Fe and a $1.55 million ranch-style retreat in the mountains near Julian.
But along with the riches has come an equal, if not greater, degree of critical scrutiny. In the past year, Ellis, 47, has been vilified by a loose coalition of health departments, medical professionals and grass-roots organizations that say his product is potentially dangerous. And he's been publicly chastised by various broadcast and print reporters for not coming clean about his criminal past, which only recently came to light.
Sitting in a conference room at Metabolife's temporary home in Sorrento Valley—a new $9 million, 90,000-square-foot headquarters is scheduled to open in the Miramar area in June—Ellis shows no sign of anger or defensiveness. In fact, he seems contrite. In a wide-ranging, exclusive interview with San Diego Magazine, he speaks with surprising candor and emotion. And he shares intimate details of his professional and personal life for the first time.
"The most troubling misconception about me, by far, is that I'm selling an unsafe product," Ellis says. "All the other stuff I can handle. But that one really hurts, because it's simply not true. When used as directed, this product [pointing to a bottle of Metabolife] is absolutely safe. If I didn't believe that, I would take it off the market immediately."
At issue is a substance in Metabolife called ephedrine. An amphetamine-like stimulant that's found in nature and also can be made synthetically, ephedrine has been used in asthma medications and other over-the-counter medicines for years. But recently, its popularity has soared as Ellis and others have packaged it with caffeine as an energy booster and diet aid. Since the ephedrine in Metabolife comes from the ephedra plant, also known as the ancient Chinese herb mahuang, Ellis can market his product as an all-natural diet supplement.
Such supplements are considered foods, not drugs, under the 1994 Dietary Supplement Health & Education Act (DSHEA) and do not require Food & Drug Administration approval for safety or efficacy before they are marketed. Instead, the law shifted the burden of proving dietary supplements unsafe to the FDA and state health departments. The FDA still has the authority to regulate herbal products, but it now must prove in court that an herbal product poses a significant or unreasonable risk—or is an imminent hazard—before it can be pulled from shelves. Prior to DSHEA, the FDA had the power to seize herbal products and remove them from the market without court proceedings.
Ellis says Metabolife has been the herbal industry leader in establishing scientific standards for safety and quality and has actually lobbied for laws and governmental guidelines that would limit ephedra content in supplements, require ephedra content and appropriate warnings on labels and prohibit ephedra products to anyone under 18. Currently, every bottle of Metabolife reads, "Not intended for use by persons under the age of 18." And Ellis says he forbids any distributor or retailer from selling to anyone under 18. If they do, he says, "They are fired immediately."