Herbalife Nutrition Ltd., also called Herbalife International, Inc. (with a U.S. subsidiary called Herbalife International of America) or simply Herbalife, is an American multinational multi-level marketing (MLM) corporation that develops and sells dietary supplements.
The company was founded by Mark R. Hughes in 1980, and employs an estimated 9,900 people worldwide. The company operates in 95 countries through a network of approximately 4.5 million independent distributors and members. In October 2022, previous CEO Michael O. Johnson was appointed as chairman and interim chief executive officer following the departure of John Agwunobi. The business is incorporated in the Cayman Islands, a tax haven, with its corporate headquarters located in Los Angeles, California.
Herbalife has been accused of fraudulently operating a pyramid scheme, deceiving distributors about the amount of income they could expect to earn and that most of their income would be made from recruiting additional distributors instead of from selling merchandise. The company agreed to "fundamentally restructure" its compensation and other benefits in the United States to include tying distributor rewards to verifiable sales, and pay a $200 million fine as part of a 2016 settlement with the U.S. Federal Trade Commission (FTC) following these accusations.
According to a 2007 research paper, some products sold by Herbalife have caused acute hepatitis.
History In February 1980, Mark R. Hughes began selling the original Herbalife weight management product from the trunk of his car. Hughes often stated that the genesis of his product and program stemmed from the weight loss concerns of his mother Joanne whose premature death he attributed to an eating disorder and an unhealthy approach to weight loss. His first product was a protein shake designed to help people manage their weight. He structured his company using a direct-selling, multi-level marketing model.
In 1982, Herbalife received complaints from the Food and Drug Administration for claims made about certain products and the inclusion of mandrake, poke root, and food-grade linseed oil in another.
The Department of Justice of Canada filed criminal charges against the company in November 1984 for misleading medical claims in advertisements. As a result of the complaints, the company modified its product claims and reformulated the product.
By 1985, Herbalife was considered the fastest-growing private company in America by Inc. after its sales increased from $386 thousand to $423 million over the previous five years. That same year, the California Attorney General sued the company for making inflated claims about the efficacy of its products. The company suffered as a result of the lawsuit and was forced to lay off nearly 800 employees by May 1985. The company settled the suit for $850,000 without admitting wrongdoing.
In 1986, Herbalife became a publicly traded company on the NASDAQ and rebranded itself as Herbalife International. However, as a result of the negative publicity from the FDA lawsuit, the company posted a $3 million loss that year.
By 1988, the company had expanded its reach to Japan, Spain, New Zealand, Israel, and Mexico, and it increased its worldwide sales to $191 million in 1991.
In 1993, the company underwent a secondary offering of five million shares.
The company launched a line of personal care products in 1995 which included fragrances and facial cleansing products.
The company was sued in civil court by two former distributors in 1997 for withholding earned income.
In 1999, Hughes attempted to take the company private after asserting that Wall Street was undervaluing it. While the board approved the buyout offer, shareholders of the company filed a suit against the company because they believed the share price they were offered was unfair. Hughes eventually abandoned his attempt to buy the company and settled the suit with shareholders. On May 20, 2000, Mark Hughes died at age 44. Following his death, the company was led by Christopher Pair until October 2001.
In March 2026, Herbalife acquired Bioniq, a UK-based personalized supplements company that uses blood biomarker analysis to formulate products, for up to US$150 million.
J.H. Whitney & Company and Golden Gate Capital In 2002, the company was acquired for US$685 million by J.H. Whitney & Company and Golden Gate Capital. Concurrently, plant sources of ephedrine were removed from Herbalife products in 2002 after several U.S. states banned supplements containing such herbs.
In April 2003, Michael O. Johnson joined Herbalife as CEO following a 17-year career with The Walt Disney Company.
On December 16, 2004, the company had an initial public offering on the NYSE of 14.5 million common shares at $14 per share, netting the owners $1.3 billion.
On May 7, 2014, the company announced that it entered into a deal with Bank of America Merrill Lynch to repurchase $266 million of its stock.
The company announced in November 2016 that Chief Operating Officer Richard Goudis would take over the position of CEO in June 2017 and Johnson would transition to Executive Chairman.
In August 2017, the company announced that it would repurchase up to $600 million of its stock.
On April 25, 2018, Herbalife announced that it had changed its name from Herbalife Ltd. to Herbalife Nutrition Ltd. The company also announced that its shareholders had approved a two-for-one stock split.
In January 2019, Herbalife announced that it was replacing Goudis after learning of comments he had made before taking over as CEO that were "contrary to the company’s expense-related policies and business practices” and inconsistent with the company's standards and culture". Former CEO Johnson subsequently took over the role on an interim basis.
In March 2020, John Agwunobi was appointed Chief Executive Officer. Agwunobi departed from Herbalife in October 2022 and Michael O. Johnson was appointed Chairman and interim Chief Executive Officer.
In May 2025, Stephan Gratziani was appointed Chief Executive Officer, becoming the first distributor since founder Mark Hughes to lead the company. Michael O. Johnson transitioned in the position of Executive Chairman.
Products
Herbalife Nutrition's products include weight-loss and protein shakes, as well as protein bars, teas, aloes, vitamins, and sports hydration, energy, and personal care products. The company's original product is the Formula 1 protein shake, a soy-based meal-replacement shake. The product debuted in 1980 and, as of 2015, was the company's best selling product accounting for nearly 30% of total sales.
Herbalife's products are produced at the company's five manufacturing facilities in the U.S. and China, as well as by third-party manufacturing partners. The company's production process is based on a "seed to feed" strategy, which the company initiated in the 2010s that allows it to trace where the ingredients in its nutritional products originated. Since 2013, the company has operated a botanical extraction facility in Changsha, Hunan Province, China. The facility produces botanical extracts, including teas, guarana, chamomile, broccoli, and bilberry, for use in many of the company's products. Before extracts are processed, they undergo a botanical identification program and are tested several times throughout the production process. The processed raw materials from the extraction facility are used at all of the company's branded manufacturing facilities as well as by its partners. As of 2015, 58% of the company's nutrition products were manufactured at Herbalife-owned facilities.
In China, the company's manufacturing sites are located in Suzhou and Nanjing. In the U.S., the company has manufacturing facilities in Lake Forest, California, and Winston-Salem, North Carolina.
Herbalife's claims of health benefits from its products have met scrutiny from the medical community, consumers, and government agencies.
In 2008, Herbalife was sued after laboratory tests indicated that levels of lead in several Herbalife products were in excess of California state law and could lead to liver problems over an extended period of time. The company commissioned its own lab testing and found that those products did not contain high enough amounts of lead to require special labeling.
Business model Herbalife Nutrition is a multi-level marketing company. A 2010 article in the Los Angeles Business Journal claimed that Herbalife Nutrition was one of the most profitable companies in Los Angeles County and directly benefited from its business model.
As a result of the 2016 FTC settlement, the company is required to prove that at least 80 percent of its sales are made to individuals outside of its distributor network. Distributors are responsible for providing receipts for sales and proving they have legitimate customers. The settlement also required that distributors are only able to earn one-third of their rewards based on recruitment. In the U.S., the company now differentiates between individuals who join as a member to buy discounted products and those who join as a distributor seeking a business opportunity. Discount buyers are unable to earn rewards or sell products. Herbalife Nutrition is also required to have its practices monitored by an outside party for seven years to ensure compliance.
In the past, company management considered the number and retention of distributors a key parameter and tracked it closely in financial reports. By January of each year, sales leaders are required to requalify. In February of each year, individuals who did not satisfy the sales leader qualification requirements during the preceding 12 months are removed from that rank. For the latest 12-month requalification period ending January 2019, approximately 67.9 percent of the eligible sales leaders requalified.
In a California class action suit (Minton v. Herbalife International, et al.) filed on February 17, 2005, the plaintiff challenged "the marketing practices of certain Herbalife International independent distributors under various state laws". In a West Virginia class action suit (Mey v. Herbalife International, Inc., et al.) filed on July 16, 2003, the plaintiffs alleged that some of Herbalife International's distributors used pre-recorded telephone messages and autodialers to contact prospective customers in violation of the Telephone Consumer Protection Act. The case was resolved with Herbalife and its distributors paying $7 million into a fund for class members part of the suit.
Liver disease inquiries Hospitals in Israel, Spain, Switzerland, Iceland, Argentina, and the United States have reported liver damage in a number of patients who used Herbalife products.
In 2004, Israel's Health Minister began an investigation into Herbalife's products after four persons using Herbalife's products were found to have liver problems. The company was criticized for the presence of lead and other heavy metals in some of its products, with comfrey specifically flagged for its association with liver toxicity. The products were sent to Bio-Medical Research Design LTD (B.R.D), to a private U.S. laboratory, and to Israel's Forensic research laboratory. A study of the cases funded by the Israeli Ministry of Health concluded that there was a causative relationship. Herbalife's SEC 10-Q filings stated that the Israeli Ministry of Health did not establish a causal relationship between the product and liver ailments. In 2009, an Israeli woman sued Herbalife International and Herbalife Israel, claiming that her liver damage resulted from the use of Herbalife products.