In 1938, under the Wheeler-Lea Act passed by the U.S. Congress, the Federal Trade Commission is charged with overseeing advertising associated with products otherwise regulated by U.S. Food and Drug Administration (FDA), with the exception of prescription drugs. The FDA itself exemplified the state of affairs in the marketplace by assembling a collection of products that illustrated shortcomings in the 1906 law.

It included Banbar, a worthless “cure” for diabetes that the old law protected; Lash-Lure, an eyelash dye in which a number of women suffered injuries to their eyes, including one confirmed case of permanent blindness.; numerous examples of foods deceptively packaged or labeled; Radithor, a radium-containing tonic that sentenced users to a slow and painful death; and the Wilhide Exhaler, which falsely promised to cure tuberculosis and other pulmonary diseases. A reporter dubbed this exhibit “The American Chamber of Horrors,” a title not far from the truth since all the products exhibited were legal under the existing law.

The new law brought cosmetics and medical devices under control, and it required that drugs be labeled with adequate directions for safe use. Moreover, it mandated pre-market approval of all new drugs, such that a manufacturer would have to prove to FDA that a drug were safe before it could be sold. It irrefutably prohibited false therapeutic claims for drugs, although a separate law granted the Federal Trade Commission jurisdiction over drug advertising.