Removal of Certain Requirements Related to the Prescription Drug Marketing Act; Opportunity for Public Comment, 41434-41438 [2011-17696]
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41434
Federal Register / Vol. 76, No. 135 / Thursday, July 14, 2011 / Proposed Rules
Subject
(d) Air Transport Association (ATA) of
America Code 27: Flight controls.
for fractured or broken rods; however,
paragraph (h) of this AD requires corrective
action.
Reason
(e) The mandatory continuing
airworthiness information (MCAI) states:
A broken aileron servo actuator centering
spring rod was discovered on a model G100
aircraft during a routine scheduled
maintenance inspection. * * * This latent
failure of a centering spring rod, if not
detected and corrected, in conjunction with
the disconnection of the normal mechanical
control system of the same servo actuator
would lead to loss [of] control of the flight
control surface [aileron or elevator]. This
condition would reduce the control
capability of the airplane and imposes a
higher workload on the flight crew reducing
their ability to cope with adverse operating
conditions.
Other FAA AD Provisions
Compliance
(f) You are responsible for having the
actions required by this AD performed within
the compliance times specified, unless the
actions have already been done.
Inspection
(g) Within 12 months after the effective
date of this AD, do the actions specified by
paragraph (g)(1) or (g)(2) of this AD, as
applicable.
(1) For Model Gulfstream G150 airplanes:
Do a one-time detailed inspection of the
aileron control servo actuators to detect
fractured or broken centering spring rods, in
accordance with the Accomplishment
Instructions of Gulfstream Service Bulletin
150–27–123, Revision 1, dated January 27,
2011.
(2) For Model Galaxy and Gulfstream 200
airplanes: Do a one-time detailed inspection
of the aileron and elevator control servo
actuators to detect fractured or broken
centering spring rods, in accordance with the
Accomplishment Instructions of Gulfstream
Service Bulletin 200–27–374, Revision 1,
dated January 27, 2011.
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Corrective Actions
(h) If any centering spring rod is found
fractured or broken during any inspection
required by this AD: Before further flight,
replace the centering spring rod in
accordance with a method approved by the
Manager, International Branch, ANM 116,
Transport Airplane Directorate, FAA, or the
Civil Aviation Authority of Israel (CAAI) (or
its delegated agent).
Credit for Actions Accomplished in
Accordance With Previous Service
Information
(i) Actions done before the effective date of
this AD in accordance with Gulfstream
Service Bulletin 150–27–123 or 200–27–374,
both dated October 27, 2010, are considered
acceptable for the actions required by
paragraph (g) of this AD.
Related Information
(k) Refer to MCAI Civil Aviation Authority
of Israel Airworthiness Directives 27–10–11–
03, dated December 6, 2010, and 27–10–12–
29, dated January 4, 2011; and Gulfstream
Service Bulletins 150–27–123 and 200–27–
374, both Revision 1, both dated January 27,
2011; for related information.
Issued in Renton, Washington, on July 6,
2011.
Kalene C. Yanamura,
Acting Manager, Transport Airplane
Directorate, Aircraft Certification Service.
[FR Doc. 2011–17697 Filed 7–13–11; 8:45 am]
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PO 00000
[Docket No. FDA–2011–N–0446]
Removal of Certain Requirements
Related to the Prescription Drug
Marketing Act; Opportunity for Public
Comment
AGENCY:
Food and Drug Administration,
HHS.
ACTION:
Proposed rule.
The Food and Drug
Administration (FDA) is proposing to
remove a section of the Prescription
Drug Marketing Act (PDMA) regulations
requiring that prior to the completion of
any wholesale distribution of a
prescription drug, an unauthorized
distributor must provide to the
purchaser ‘‘a statement identifying each
prior sale, purchase, or trade of such
drug,’’ starting with the manufacturer,
and that the identifying statement (also
known as the ‘‘pedigree’’) must include
certain information about the drug and
each prior sale, purchase, or trade. This
action is being taken in response to
longstanding issues, including an
injunction currently in effect, regarding
the application of and compliance with
this requirement. FDA is also
announcing that it intends to exercise
enforcement discretion with respect to
certain requirements of the regulation
while the rulemaking is pending and
with respect to the statutory pedigree
requirements of the PDMA, as long as
the pedigree identifies the names and
addresses of the last authorized
distributor of record that handled the
drug and the associated dates of
transactions involving that last
authorized distributor of record and the
drug, as well as the names and
addresses of all subsequent
unauthorized distributors that handled
the drug and the corresponding dates of
those transactions.
DATES: Submit either electronic or
written comments on the proposed rule
by September 12, 2011.
ADDRESSES: You may submit comments,
identified by Docket No. FDA–2011–N–
0446, by any of the following methods:
SUMMARY:
Submit electronic comments in the
following way:
• Federal eRulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
Note 1: This AD differs from the MCAI
and/or service information as follows: The
MCAI AD does not specify a corrective action
14:54 Jul 13, 2011
21 CFR Part 203
Electronic Submissions
FAA AD Differences
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Food and Drug Administration
(j) The following provisions also apply to
this AD:
(1) Alternative Methods of Compliance
(AMOCs): The Manager, International
Branch, ANM–116, Transport Airplane
Directorate, FAA, has the authority to
approve AMOCs for this AD, if requested
using the procedures found in 14 CFR 39.19.
In accordance with 14 CFR 39.19, send your
request to your principal inspector or local
Flight Standards District Office, as
appropriate. If sending information directly
to the International Branch, send it to ATTN:
Mike Borfitz, Aerospace Engineer,
International Branch, ANM–116, Transport
Airplane Directorate, FAA, 1601 Lind
Avenue, SW., Renton, Washington 98057–
3356; telephone (425) 227–2677; fax (425)
227–1149. Information may be e-mailed to:
9-ANM-116-AMOC-REQUESTS@faa.gov.
Before using any approved AMOC, notify
your appropriate principal inspector, or
lacking a principal inspector, the manager of
the local flight standards district office/
certificate holding district office. The AMOC
approval letter must specifically reference
this AD.
(2) Airworthy Product: For any requirement
in this AD to obtain corrective actions from
a manufacturer or other source, use these
actions if they are FAA-approved. Corrective
actions are considered FAA-approved if they
are approved by the State of Design Authority
(or their delegated agent). You are required
to assure the product is airworthy before it
is returned to service.
BILLING CODE 4910–13–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
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Federal Register / Vol. 76, No. 135 / Thursday, July 14, 2011 / Proposed Rules
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Written Submissions
Submit written submissions in the
following ways:
• FAX: 301–827–6870.
• Mail/Hand delivery/Courier (for
paper, disk, or CD–ROM submissions):
Division of Dockets Management (HFA–
305), Food and Drug Administration,
5630 Fishers Lane, rm. 1061, Rockville,
MD 20852.
Instructions: All submissions received
must include the Agency name and
Docket No. for this rulemaking. All
comments received may be posted
without change to https://
www.regulations.gov, including any
personal information provided. For
additional information on submitting
comments, see the ‘‘Comments’’ heading
of the SUPPLEMENTARY INFORMATION
section of this document.
Docket: For access to the docket to
read background documents or
comments received, go to https://
www.regulations.gov and insert the
docket number(s), found in brackets in
the heading of this document, into the
‘‘Search’’ box and follow the prompts
and/or go to the Division of Dockets
Management, 5630 Fishers Lane, rm.
1061, Rockville, MD 20852.
FOR FURTHER INFORMATION CONTACT:
Karen Rothschild, Center for Drug
Evaluation and Research, Food Drug
Administration, 10903 New Hampshire
Ave., Silver Spring, MD 20993, 301–
796–3689, e-mail:
karen.rothschild@fda.hhs.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The PDMA (Pub. L. 100–293) was
enacted on April 22, 1988, and was
modified by the PDA (Pub. L. 102–353)
on August 26, 1992. The PDMA, as
modified, amended the Federal Food,
Drug, and Cosmetic Act (the FD&C Act)
to establish restrictions and
requirements relating to various aspects
of human prescription drug marketing
and distribution. The primary purpose
of the PDMA was to increase safeguards
to prevent the introduction and retail
sale of substandard, ineffective, and
counterfeit drugs into the U.S. drug
supply chain. Among other things, the
PDMA, in section 503(e)(1)(A) of the
FD&C Act (21 U.S.C. 353), requires a
wholesale distributor ‘‘who is not the
manufacturer or authorized distributor
of record’’ to provide drug pedigrees to
purchasers ‘‘identifying each prior sale,
purchase or trade of such drug
(including the date of the transaction
and the names and addresses of all
parties to the transaction).’’
On August 1, 1988, the Agency issued
a letter that provided guidance on the
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PDMA for industry pending the
issuance of implementing regulations
(the 1988 guidance letter) (see
attachment E of FDA’s 2001 Report to
Congress (https://www.fda.gov/
downloads/RegulatoryInformation/
Legislation/FederalFoodDrugand
CosmeticActFDCAct/Significant
AmendmentstotheFDCAct/Prescription
DrugMarketingActof1987/UCM203186.
pdf)). Among other issues, the 1988
guidance letter discussed drug
pedigrees. The 1988 guidance letter
stated that the necessary identifying
information regarding all sales in the
chain of distribution may start with the
manufacturer or authorized distributor
of record. As explained in an FDA 2001
Prescription Drug Marketing Act Report
to Congress (2001 Report to Congress)
(see https://www.fda.gov/downloads/
RegulatoryInformation/Legislation/
FederalFoodDrugandCosmeticAct
FDCAct/SignificantAmendments
totheFDCAct/PrescriptionDrug
MarketingActof1987/UCM203186.pdf),
it was the Agency’s understanding at the
time that the authorized distributor of
record would be the distributor to
whom the manufacturer first sold the
drugs, not just any authorized
distributor who happened to purchase
the drugs somewhere along the
distribution chain.
In the Federal Register of March 14,
1994 (59 FR 11842), we issued a
proposed rule related to certain
provisions of the PDMA. With respect to
prescription drug pedigrees, the
proposed rule provided in relevant part
that the identifying statement for sales
by unauthorized distributors must
include ‘‘the business name and address
of all parties to each prior transaction
involving the drug, starting with the
manufacturer.’’ (59 FR 11865). A final
rule was issued in the Federal Register
of December 3, 1999 (64 FR 67720) (the
December 1999 final rule), with an
effective date of December 4, 2000. The
final rule contained provisions on
prescription drug reimportation;
wholesale distribution of prescription
drugs by unauthorized distributors; the
resale of prescription drugs by hospitals,
health care entities, and charitable
institutions; and distribution of
prescription drug samples. In the
December 1999 final rule, FDA
responded to a comment objecting to the
pedigree requirement as proposed
because it would require an
unauthorized distributor to provide
information about all prior sales,
purchases, or trades of the drug, starting
with the manufacturer, even in cases
where the seller from whom the
distributor received the drug was an
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41435
authorized distributor of record and did
not provide any pedigree for the drug.
The comment recommended revising
the proposed rule to require that the
pedigree only go back to the last
authorized distributor of record (64 FR
67720 at 67747). FDA declined to revise
the rule, explaining that the statute
requires that the pedigree identify ‘‘each
prior sale, purchase, or trade of the
drug’’ and ‘‘[t]here is no indication in
[the] PDMA that Congress intended that
the statement include only those sales,
purchases, or trades since the drug was
last handled by an authorized
distributor.’’ (64 FR 67720 at 67747).
The December 1999 final rule thus
codified § 203.50(a) (21 CFR 203.50(a)),
which follows section 503(e)(1)(A) of
the FD&C Act, requiring that, before the
completion of any wholesale
distribution by a wholesale distributor
of a prescription drug for which the
seller is not a manufacturer or an
authorized distributor of record, the
seller must provide to the purchaser a
statement (also referred to as a pedigree)
identifying each prior sale, purchase, or
trade of the drug. According to
§ 203.50(a), the identifying statement
must include: The proprietary and
established name of the drug; dosage;
container size; number of containers;
the lot or control numbers of the drug
being distributed; the business name
and address of all parties to each prior
transaction involving the drug, starting
with the manufacturer; and the date of
each previous transaction.
After publication of the December
1999 final rule, we received many
comments on, and held several meetings
to discuss, the implications of the final
regulations regarding, among other
things, the pedigree provisions at
§ 203.50(a) requiring unauthorized
distributors to provide a pedigree
showing all prior sales going back to the
manufacturer. Industry representatives
of unauthorized distributors represented
that they could not obtain the required
pedigree showing all prior sales of the
drugs they purchase because a large
portion of these drugs are purchased
from authorized distributors who are
not required to provide pedigrees and
who are unwilling to voluntarily
provide them.1 Industry representatives
also claimed that implementation of this
requirement could prevent as many as
4,000 smaller, unauthorized distributors
from distributing many drugs to their
1 FDA, The Prescription Drug Marketing Act
Report to Congress, 2001 (https://www.fda.gov/
downloads/RegulatoryInformation/Legislation/
FederalFoodDrugandCosmeticActFDCAct/
SignificantAmendmentstotheFDCAct/
PrescriptionDrugMarketingActof1987/
UCM203186.pdf).
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customers, putting the unauthorized
distributors out of business.2
In the 2001 Report to Congress, we
noted that we would be able to address
some, but not all of the concerns raised
by unauthorized distributors. We stated
that we believed that ‘‘the concerns
related to continuing to exempt
authorized distributors from the
pedigree requirement and the exact
meaning of the phrase ‘each prior sale’
can be addressed only through statutory
remedies.’’ 3
As a result of these comments, other
informal communications that FDA had
with industry, industry associations,
and Congress, and the Agency’s
consideration of a petition for stay of
action received on May 3, 2000, FDA
delayed the effective date of several
provisions of the December 1999 final
rule until October 1, 2001, and reopened
the administrative record to receive
additional comments (65 FR 25639, May
3, 2000). In the Federal Register of
March 1, 2001 (66 FR 12850), we
announced our decision to further delay
until April 1, 2002, the applicability of
§ 203.50, among other provisions.
Further delays of the effective dates
followed until December 1, 2006, to give
us additional time to consider whether
regulatory changes were appropriate
and, if so, to initiate such changes (67
FR 6645, February 13, 2002; 69 FR 4912,
January 23, 2003; 69 FR 8105, February
23, 2004).
While § 203.50 was stayed, the
industry followed the advice given in
the 1988 guidance letter, which, as
noted previously, stated that the
pedigree should include ‘‘all necessary
identifying information regarding all
sales in the chain of distribution of the
product, starting with the manufacturer
or the authorized distributor.’’
In the Federal Register of June 14,
2006 (71 FR 34249), we announced that
FDA did not intend to further delay the
effective date of certain regulations
related to the PDMA, including
§ 203.50, and that the regulation would
go into effect on December 1, 2006.
On September 20, 2006, a group of
unauthorized wholesalers of
prescription drugs filed a lawsuit
against FDA in the U.S. District Court
for the Eastern District of New York,
seeking, among other things, a
declaratory judgment that § 203.50(a)
erroneously interprets the statutory
requirement for pedigrees (21 U.S.C.
353(e)(1)(A)), and violates the U.S.
Constitution’s guarantees of equal
protection and due process. (RxUSA
Wholesale, Inc. v. Dept. of Health and
2 (See
3 (See
footnote 1 of this document.)
footnote 1 of this document.)
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Human Servs., 467 F. Supp.2d 285
(E.D.N.Y. 2006)). On November 22,
2006, the plaintiffs moved for a
preliminary injunction against
implementation of the regulation,
which, as noted previously, was
scheduled to become effective on
December 1, 2006. On December 8,
2006, the district court issued a
preliminary injunction enjoining FDA
from implementing § 203.50(a) (467
F.Supp. 2d at 292). The court concluded
that the statute, unlike § 203.50(a), does
not ‘‘specifically or expressly require[]
unauthorized distributors to provide
pedigree information all the way back to
the manufacturer.’’ 467 F. Supp. 2d at
290 (emphasis in original). The court
stated that ‘‘[u]nauthorized distributors
would be unable to comply with’’ the
December 1999 final rule requirement to
‘‘provide complete pedigree information
for all prior sales up to the
manufacturer’’ because unauthorized
distributors purchase drugs from
authorized distributors ‘‘who do not
provide pedigree information.’’ (467 F.
Supp. 2d at 291). The district court
concluded that plaintiffs had shown a
likelihood of success on the merits of
their claim because, in the court’s view,
the pedigree regulation undermined the
purpose of the statute and was therefore
arbitrary and capricious. (467 F. Supp.
2d at 291). The court also found that
issuance of the preliminary injunction
would benefit the public interest by
preserving ‘‘the status quo and the
current practice in the industry.’’ (467 F.
Supp. 2d at 292).
The Agency appealed the district
court’s preliminary injunction order, but
the district court’s order was affirmed
on July 10, 2008, by the U.S. Court of
Appeals for the Second Circuit. (See
RxUSA Wholesale, Inc., v. Dept. of
Health and Human Servs., 285 Fed.
Appx. 809 (2d Cir. 2008)). The appellate
court explained that the PDMA ‘‘does
not specifically state whether’’ a
pedigree must ‘‘extend back to the
manufacturer, or whether it must only
extend to the last authorized distributor.
The parties offer differing textual
interpretations, but we agree with the
district court that for purposes of
preliminary injunction the statute’s
language does not unambiguously
compel one interpretation over
another.’’ (285 Fed. Appx. at 811).
Moreover, the second circuit concluded
that the district court had not abused its
discretion in determining that the
plaintiffs had shown a likelihood of
success on the merits because
§ 203.50(a) requires unauthorized
distributors to ‘‘provide pedigree
information that is currently held only
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by authorized distributors’’ and the
regulation is ‘‘inconsistent with the
position taken by the agency in its
original 1988 guidance letter, and it
runs directly counter to the 20-year
history of industry reliance on the
FDA’s initial position.’’ (285 Fed. Appx.
at 811).
The district court’s preliminary
injunction, as affirmed by the circuit
court, halted FDA’s implementation of
the requirements of § 203.50(a).
Specifically, the order enjoins FDA from
implementing the requirement in
§ 203.50(a) that a pedigree identify each
prior sale or trade of a drug back to the
drug’s original manufacturer and the
requirement that specifies the types of
information that must be included in
the pedigree, including lot numbers and
container sizes.
Under the district court’s order,
unauthorized distributors are only
required to provide pedigrees that
include information regarding
transactions going back to either the
manufacturer or the last authorized
distributor of record that handled the
drugs. In addition, as specified in the
FD&C Act, all pedigrees must include
the dates of the listed transactions and
the names and addresses of all parties
to those transactions. We recognized
that these circumstances resulting from
the court’s order could lead to confusion
and possible disruptions or delays in
the nation’s drug distribution system for
wholesale distributors operating outside
of the court’s jurisdiction and could
provide an undue advantage to certain
wholesaler distributors. Therefore, we
announced that we would exercise
enforcement discretion in a manner
consistent with the court’s opinion
throughout the rest of the country.
II. Proposed Regulation
FDA is now proposing to remove
§ 203.50(a). Over the past 20 years, we
have endeavored to ensure that the
pedigree requirements in our
regulations are consistent with
congressional intent and provide
appropriate accountability to protect our
nation’s drug supply. We have made a
good faith effort to implement the
requirements in § 203.50(a) consistent
with the language of the PDMA through
public meetings, Federal Register
documents requesting comments,
meetings with the wholesale industry,
Members of Congress, and others, a
Report to Congress, and other actions.
For the various reasons discussed
earlier, § 203.50(a) has been effective for
only a total of 7 days since the
finalization of the rule in 1999. As
explained previously, there have been
serious ongoing concerns about the
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effect that full implementation of the
statutory pedigree requirements, as
codified in § 203.50(a), would have on
the nation’s drug supply and on
wholesaler distributors. Therefore, in
light of the courts’ opinions, we are
proposing to remove § 203.50(a).
By proposing to remove § 203.50(a),
we would remove the requirement in
the regulation that the pedigree identify
each prior sale or trade of a drug back
to the drug’s manufacturer. In addition,
this proposal would remove the
requirement in the regulation that the
identifying statement include certain
information, such as the proprietary and
established name of the drug, the
dosage, container size, number of
containers, the drug’s lot or control
number(s), the business name and
address of all parties for each prior
transaction, starting with the
manufacturer, and the date of each
previous transaction. While the
rulemaking to remove the regulation is
pending, we intend to exercise
enforcement discretion with respect to
all of these requirements in § 203.50(a).
We note that even with the removal
of § 203.50(a), the pedigree requirements
of section 503(e)(1)(A) of the FD&C Act
would still be in effect. However, with
respect to these statutory pedigree
requirements, the Agency intends to
exercise enforcement discretion and not
initiate an enforcement action against
any wholesalers for failing to provide a
pedigree that goes back to the
manufacturer or for failing to include
the specific information listed in the
regulation, as long as the pedigree
otherwise identifies the last authorized
distributor of record that handled the
drugs and the associated dates of the
transactions, as well as the names and
addresses of all unauthorized
distributors that handled the drug after
the last authorized distributor, and the
corresponding dates of those
transactions.
In summary, unauthorized
distributors need to be aware that their
pedigree(s) must: (1) Include
information regarding transactions going
back to either the manufacturer or the
last authorized distributor of record that
handled the drugs, consistent with the
preliminary injunction order previously
referenced and (2) include the date of
the transaction and the names and
addresses of all parties to the
transaction as explicitly required under
section 503(e)(1)(A) of the FD&C Act.
Furthermore, while FDA is proposing to
remove § 203.50(a) and intends to
exercise enforcement discretion under
these described circumstances with
respect to the statutory requirements for
a pedigree, FDA encourages wholesalers
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to include the drug, dosage, container
size, number of containers, and the
drug’s lot or control number(s) in the
pedigree as well.
FDA continues to believe that drug
supply chain security is of the utmost
importance and that transparency of
transactions and accountability are
essential to further secure our nation’s
drug supply. Counterfeit and diverted
drugs continue to be found in our drug
supply chain and the action proposed in
this document should not be interpreted
to mean that there is not a problem with
counterfeit and diverted drugs. Rather,
FDA remains committed to the
framework set forth in the 2004 FDA
Counterfeit Drug Task Force Report
(Task Force Report) and subsequent
updates to that Task Force Report
(https://www.fda.gov/Drugs/DrugSafety/
ucm169825.htm) and will continue to
move forward, working with the private
and public sectors to improve the
security of the drug supply chain and
implement measures to further protect
Americans from counterfeit and
diverted drugs. We also will continue
our efforts to implement the
pharmaceutical security provisions
contained in section 913 of the Food
and Drug Administration Amendments
Act of 2007.
As stated in the Task Force Report,
such measures include implementation
of tracking and tracing, which would
help secure the integrity of the supply
chain by providing an accurate
electronic record of transactions in the
drug supply chain. Such electronic
records documenting the movement of a
drug product from the manufacturer to
the dispenser would be an important
step in preventing counterfeit and
diverted drugs from entering the drug
supply chain. FDA will continue to
develop standards for the purpose of
securing the drug supply chain against
counterfeit, diverted, subpotent,
substandard, adulterated, misbranded,
or expired drugs, including standards
for the identification, validation,
authentication, and tracking and tracing
of prescription drugs. We are not
proposing any new provisions in lieu of
§ 203.50(a) at this time.
III. Legal Authority
FDA is issuing this proposed rule to
remove the provisions in § 203.50(a)
under its rulemaking authority under
section 701(a) of the FD&C Act (21
U.S.C. 371) and based on those reasons
provided in section II of this document.
Specifically, FDA can issue regulations
through its rulemaking authority to
establish requirements for section 503(e)
of the FD&C Act. As described in
section I of this document, FDA
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41437
previously issued a final rule
establishing certain requirements for
section 503(e)(1)(a). Similarly, under its
rulemaking authority, FDA can propose
to remove those specific requirements
that have been established by
regulation. FDA is basing the proposed
removal of § 203.50(a) on the grounds
described in section II of this document.
As explained earlier, the statutory
provisions of section 503(e) of the FD&C
Act, as well as the other provisions of
§ 203.50 that would not be removed by
this proposed rule, would remain
legally effective.
IV. Analysis of Impacts
FDA has examined the impacts of the
proposed rule under Executive Order
12866, Executive Order 13563, the
Regulatory Flexibility Act (5 U.S.C.
601–612), and the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104–4).
Executive Orders 12866 and 13563
direct Agencies to assess all costs and
benefits of available regulatory
alternatives and, when regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety,
and other advantages; distributive
impacts; and equity). The Agency
believes that this proposed rule is not a
significant regulatory action as defined
by Executive Order 12866.
The Regulatory Flexibility Act
requires Agencies to analyze regulatory
options that would minimize any
significant impact of a rule on small
entities. Because the removal of the
specified pedigree requirements for
prescription drug distribution in
§ 203.50(a) would not measurably
decrease the estimated compliance costs
of the December 1999 final rule, the
Agency proposes to certify that the final
rule will not have a significant
economic impact on a substantial
number of small entities.
Section 202(a) of the Unfunded
Mandates Reform Act of 1995 requires
that Agencies prepare a written
statement, which includes an
assessment of anticipated costs and
benefits, before proposing ‘‘any rule that
includes any Federal mandate that may
result in the expenditure by State, local,
and tribal governments, in the aggregate,
or by the private sector, of $100,000,000
or more (adjusted annually for inflation)
in any one year.’’ The current threshold
after adjustment for inflation is $136
million, using the most current (2010)
Implicit Price Deflator for the Gross
Domestic Product. FDA does not expect
this proposed rule to result in any 1year expenditure that would meet or
exceed this amount.
E:\FR\FM\14JYP1.SGM
14JYP1
41438
Federal Register / Vol. 76, No. 135 / Thursday, July 14, 2011 / Proposed Rules
The Agency published a final rule on
December 3, 1999, codified in
§ 203.50(a), that contained certain
requirements concerning prescription
drug distribution. Specifically, it
required that before the wholesale
distribution of any prescription drug to
another wholesale distributor or retail
pharmacy for which the seller is not an
authorized distributor of record, the
wholesale distributor must provide to
the purchaser a statement identifying
each prior sale, purchase or trade.
Further, it contained a list of specific
information to be contained in the
identifying statement. As explained
previously, this regulation is the subject
of a preliminary injunction. In the
December 1999 final rule, the Agency
estimated that the wholesale
distribution requirements, including the
drug identifying (or origin) statement
and a separate distributor list to be
provided by manufacturers, would
together impose $258,000 in annual
recordkeeping costs. In making this
estimate, the Agency judged that the
marginal costs for the inclusion of the
additional information that § 203.50(a)
would have required beyond that
information that would be required in
the PDMA pedigree provision would be
negligible, and did not increase its cost
estimate to reflect this additional effort.
The removal of § 203.50(a), therefore, is
expected to reduce compliance costs by
only that negligible amount that the
Agency did not separately estimate for
the final rule, as the pedigree provision
of the PDMA still requires its own,
slightly less expansive, pedigree
provision. This regulatory action that
removes a provision of the December
1999 final rule is expected to reduce the
previously estimated annual compliance
costs of $258,000 for this provision by
a negligible, but unquantified, amount.
wreier-aviles on DSKGBLS3C1PROD with PROPOSALS
V. Paperwork Reduction Act of 1995
FDA tentatively concludes that this
proposed rule contains no collection of
information. Therefore, clearance by the
Office of Management and Budget under
the Paperwork Reduction Act of 1995 is
not required.
VI. Environmental Impact
The Agency has determined under 21
CFR 25.30 this action is of a type that
does not individually or cumulatively
have a significant effect on the human
environment. Therefore, neither an
environmental assessment nor an
environmental impact statement is
required.
VII. Federalism
FDA has analyzed this proposed rule
in accordance with the principles set
VerDate Mar<15>2010
14:54 Jul 13, 2011
Jkt 223001
forth in Executive Order 13132. FDA
has determined that the proposed rule,
if finalized, would not contain policies
that would have substantial direct
effects on the States, on the relationship
between the National Government and
the States, or on the distribution of
power and responsibilities among the
various levels of government.
Accordingly, the Agency tentatively
concludes that the proposed rule does
not contain policies that have
federalism implications as defined in
the Executive order and, consequently,
a federalism summary impact statement
is not required.
VIII. Proposed Effective Date
The Agency is proposing that any
final rule that may issue based upon this
proposed rule become effective upon its
publication in the Federal Register.
IX. Comments
Interested persons may submit to the
Division of Dockets Management (see
ADDRESSES) either electronic or written
comments regarding this document. It is
only necessary to send one set of
comments. It is no longer necessary to
send two copies of mailed comments.
Identify comments with the docket
number found in brackets in the
heading of this document. Received
comments may be seen in the Division
of Dockets Management between 9 a.m.
and 4 p.m., Monday through Friday.
List of Subjects in 21 CFR Part 203
Labeling, Prescription drugs,
Reporting and recordkeeping
requirements, Warehouses.
Therefore, under the Federal Food,
Drug, and Cosmetic Act and under
authority delegated to the Commissioner
of Food and Drugs, it is proposed that
21 CFR part 203 be amended as follows:
PART 203—PRESCRIPTION DRUG
MARKETING
1. The authority citation for 21 CFR
part 203 continues to read as follows:
Authority: 21 U.S.C. 331, 333, 351, 352,
353, 360, 371, 374, 381.
§ 203.50
[Amended]
2. Section 203.50 is amended by
removing and reserving paragraph (a).
Dated: July 1, 2011.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2011–17696 Filed 7–13–11; 8:45 am]
BILLING CODE 4160–01–P
PO 00000
Frm 00009
Fmt 4702
Sfmt 4702
DEPARTMENT OF STATE
22 CFR Part 123
RIN 1400–AC85
[Public Notice 7524]
International Traffic in Arms
Regulations: International Import
Certificate
Department of State.
Proposed rule.
AGENCY:
ACTION:
The Department of State
proposes to amend the International
Traffic in Arms Regulations (ITAR) to
remove reference to the International
Import Certificate. This amendment will
effectively cease the Department’s
current practice of accepting DSP–53
submissions, as there is no statutory,
regulatory, or other authoritative basis
for the Department to do so.
DATES: The Department of State will
accept comments on this proposed rule
until August 29, 2011.
ADDRESSES:
Interested parties may submit
comments within 45 days of the date of
the publication by any of the following
methods:
• E-mail:
DDTCResponseTeam@state.gov with the
subject line, ‘‘International Import
Certificate, ITAR Section 123.4.’’
• Internet: View this notice by
searching for its RIN number on the U.S.
Government regulations Web site at
https://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT:
Samuel C. Harmon, Office of Defense
Trade Controls Policy, Department of
State, by telephone: (202) 663–2728; fax:
(202) 261–8199; or e-mail:
harmonsc@state.gov. ATTN:
International Import Certificate, ITAR
Section 123.4.
SUPPLEMENTARY INFORMATION: The Arms
Export Control Act authorizes the
President to control the import and
export of defense articles. Executive
Order 11958, as amended, delegated the
authority to regulate permanent exports
and temporary imports and exports of
defense articles to the Department of
State, and delegated the authority to
regulate permanent imports to the
Attorney General. The International
Import Certificate (IIC), Form BIS–645P/
ATF–4522/DPS–53, is identified as a
form issued by the Department of
Commerce’s Bureau of Industry &
Security; the Department of Justice’s
Bureau of Alcohol, Tobacco, Firearms
and Explosives; and the Department of
State’s Directorate of Defense Trade
Controls (DDTC). It is meant to
SUMMARY:
E:\FR\FM\14JYP1.SGM
14JYP1
Agencies
[Federal Register Volume 76, Number 135 (Thursday, July 14, 2011)]
[Proposed Rules]
[Pages 41434-41438]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-17696]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Food and Drug Administration
21 CFR Part 203
[Docket No. FDA-2011-N-0446]
Removal of Certain Requirements Related to the Prescription Drug
Marketing Act; Opportunity for Public Comment
AGENCY: Food and Drug Administration, HHS.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: The Food and Drug Administration (FDA) is proposing to remove
a section of the Prescription Drug Marketing Act (PDMA) regulations
requiring that prior to the completion of any wholesale distribution of
a prescription drug, an unauthorized distributor must provide to the
purchaser ``a statement identifying each prior sale, purchase, or trade
of such drug,'' starting with the manufacturer, and that the
identifying statement (also known as the ``pedigree'') must include
certain information about the drug and each prior sale, purchase, or
trade. This action is being taken in response to longstanding issues,
including an injunction currently in effect, regarding the application
of and compliance with this requirement. FDA is also announcing that it
intends to exercise enforcement discretion with respect to certain
requirements of the regulation while the rulemaking is pending and with
respect to the statutory pedigree requirements of the PDMA, as long as
the pedigree identifies the names and addresses of the last authorized
distributor of record that handled the drug and the associated dates of
transactions involving that last authorized distributor of record and
the drug, as well as the names and addresses of all subsequent
unauthorized distributors that handled the drug and the corresponding
dates of those transactions.
DATES: Submit either electronic or written comments on the proposed
rule by September 12, 2011.
ADDRESSES: You may submit comments, identified by Docket No. FDA-2011-
N-0446, by any of the following methods:
Electronic Submissions
Submit electronic comments in the following way:
Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
[[Page 41435]]
Written Submissions
Submit written submissions in the following ways:
FAX: 301-827-6870.
Mail/Hand delivery/Courier (for paper, disk, or CD-ROM
submissions): Division of Dockets Management (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852.
Instructions: All submissions received must include the Agency name
and Docket No. for this rulemaking. All comments received may be posted
without change to https://www.regulations.gov, including any personal
information provided. For additional information on submitting
comments, see the ``Comments'' heading of the SUPPLEMENTARY INFORMATION
section of this document.
Docket: For access to the docket to read background documents or
comments received, go to https://www.regulations.gov and insert the
docket number(s), found in brackets in the heading of this document,
into the ``Search'' box and follow the prompts and/or go to the
Division of Dockets Management, 5630 Fishers Lane, rm. 1061, Rockville,
MD 20852.
FOR FURTHER INFORMATION CONTACT: Karen Rothschild, Center for Drug
Evaluation and Research, Food Drug Administration, 10903 New Hampshire
Ave., Silver Spring, MD 20993, 301-796-3689, e-mail:
karen.rothschild@fda.hhs.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The PDMA (Pub. L. 100-293) was enacted on April 22, 1988, and was
modified by the PDA (Pub. L. 102-353) on August 26, 1992. The PDMA, as
modified, amended the Federal Food, Drug, and Cosmetic Act (the FD&C
Act) to establish restrictions and requirements relating to various
aspects of human prescription drug marketing and distribution. The
primary purpose of the PDMA was to increase safeguards to prevent the
introduction and retail sale of substandard, ineffective, and
counterfeit drugs into the U.S. drug supply chain. Among other things,
the PDMA, in section 503(e)(1)(A) of the FD&C Act (21 U.S.C. 353),
requires a wholesale distributor ``who is not the manufacturer or
authorized distributor of record'' to provide drug pedigrees to
purchasers ``identifying each prior sale, purchase or trade of such
drug (including the date of the transaction and the names and addresses
of all parties to the transaction).''
On August 1, 1988, the Agency issued a letter that provided
guidance on the PDMA for industry pending the issuance of implementing
regulations (the 1988 guidance letter) (see attachment E of FDA's 2001
Report to Congress (https://www.fda.gov/downloads/RegulatoryInformation/Legislation/FederalFoodDrugandCosmeticActFDCAct/SignificantAmendmentstotheFDCAct/PrescriptionDrugMarketingActof1987/UCM203186.pdf)). Among other issues, the 1988 guidance letter discussed
drug pedigrees. The 1988 guidance letter stated that the necessary
identifying information regarding all sales in the chain of
distribution may start with the manufacturer or authorized distributor
of record. As explained in an FDA 2001 Prescription Drug Marketing Act
Report to Congress (2001 Report to Congress) (see https://www.fda.gov/downloads/RegulatoryInformation/Legislation/FederalFoodDrugandCosmeticActFDCAct/SignificantAmendmentstotheFDCAct/PrescriptionDrugMarketingActof1987/UCM203186.pdf), it was the Agency's
understanding at the time that the authorized distributor of record
would be the distributor to whom the manufacturer first sold the drugs,
not just any authorized distributor who happened to purchase the drugs
somewhere along the distribution chain.
In the Federal Register of March 14, 1994 (59 FR 11842), we issued
a proposed rule related to certain provisions of the PDMA. With respect
to prescription drug pedigrees, the proposed rule provided in relevant
part that the identifying statement for sales by unauthorized
distributors must include ``the business name and address of all
parties to each prior transaction involving the drug, starting with the
manufacturer.'' (59 FR 11865). A final rule was issued in the Federal
Register of December 3, 1999 (64 FR 67720) (the December 1999 final
rule), with an effective date of December 4, 2000. The final rule
contained provisions on prescription drug reimportation; wholesale
distribution of prescription drugs by unauthorized distributors; the
resale of prescription drugs by hospitals, health care entities, and
charitable institutions; and distribution of prescription drug samples.
In the December 1999 final rule, FDA responded to a comment objecting
to the pedigree requirement as proposed because it would require an
unauthorized distributor to provide information about all prior sales,
purchases, or trades of the drug, starting with the manufacturer, even
in cases where the seller from whom the distributor received the drug
was an authorized distributor of record and did not provide any
pedigree for the drug. The comment recommended revising the proposed
rule to require that the pedigree only go back to the last authorized
distributor of record (64 FR 67720 at 67747). FDA declined to revise
the rule, explaining that the statute requires that the pedigree
identify ``each prior sale, purchase, or trade of the drug'' and
``[t]here is no indication in [the] PDMA that Congress intended that
the statement include only those sales, purchases, or trades since the
drug was last handled by an authorized distributor.'' (64 FR 67720 at
67747).
The December 1999 final rule thus codified Sec. 203.50(a) (21 CFR
203.50(a)), which follows section 503(e)(1)(A) of the FD&C Act,
requiring that, before the completion of any wholesale distribution by
a wholesale distributor of a prescription drug for which the seller is
not a manufacturer or an authorized distributor of record, the seller
must provide to the purchaser a statement (also referred to as a
pedigree) identifying each prior sale, purchase, or trade of the drug.
According to Sec. 203.50(a), the identifying statement must include:
The proprietary and established name of the drug; dosage; container
size; number of containers; the lot or control numbers of the drug
being distributed; the business name and address of all parties to each
prior transaction involving the drug, starting with the manufacturer;
and the date of each previous transaction.
After publication of the December 1999 final rule, we received many
comments on, and held several meetings to discuss, the implications of
the final regulations regarding, among other things, the pedigree
provisions at Sec. 203.50(a) requiring unauthorized distributors to
provide a pedigree showing all prior sales going back to the
manufacturer. Industry representatives of unauthorized distributors
represented that they could not obtain the required pedigree showing
all prior sales of the drugs they purchase because a large portion of
these drugs are purchased from authorized distributors who are not
required to provide pedigrees and who are unwilling to voluntarily
provide them.\1\ Industry representatives also claimed that
implementation of this requirement could prevent as many as 4,000
smaller, unauthorized distributors from distributing many drugs to
their
[[Page 41436]]
customers, putting the unauthorized distributors out of business.\2\
---------------------------------------------------------------------------
\1\ FDA, The Prescription Drug Marketing Act Report to Congress,
2001 (https://www.fda.gov/downloads/RegulatoryInformation/Legislation/FederalFoodDrugandCosmeticActFDCAct/SignificantAmendmentstotheFDCAct/PrescriptionDrugMarketingActof1987/UCM203186.pdf).
\2\ (See footnote 1 of this document.)
---------------------------------------------------------------------------
In the 2001 Report to Congress, we noted that we would be able to
address some, but not all of the concerns raised by unauthorized
distributors. We stated that we believed that ``the concerns related to
continuing to exempt authorized distributors from the pedigree
requirement and the exact meaning of the phrase `each prior sale' can
be addressed only through statutory remedies.'' \3\
---------------------------------------------------------------------------
\3\ (See footnote 1 of this document.)
---------------------------------------------------------------------------
As a result of these comments, other informal communications that
FDA had with industry, industry associations, and Congress, and the
Agency's consideration of a petition for stay of action received on May
3, 2000, FDA delayed the effective date of several provisions of the
December 1999 final rule until October 1, 2001, and reopened the
administrative record to receive additional comments (65 FR 25639, May
3, 2000). In the Federal Register of March 1, 2001 (66 FR 12850), we
announced our decision to further delay until April 1, 2002, the
applicability of Sec. 203.50, among other provisions. Further delays
of the effective dates followed until December 1, 2006, to give us
additional time to consider whether regulatory changes were appropriate
and, if so, to initiate such changes (67 FR 6645, February 13, 2002; 69
FR 4912, January 23, 2003; 69 FR 8105, February 23, 2004).
While Sec. 203.50 was stayed, the industry followed the advice
given in the 1988 guidance letter, which, as noted previously, stated
that the pedigree should include ``all necessary identifying
information regarding all sales in the chain of distribution of the
product, starting with the manufacturer or the authorized
distributor.''
In the Federal Register of June 14, 2006 (71 FR 34249), we
announced that FDA did not intend to further delay the effective date
of certain regulations related to the PDMA, including Sec. 203.50, and
that the regulation would go into effect on December 1, 2006.
On September 20, 2006, a group of unauthorized wholesalers of
prescription drugs filed a lawsuit against FDA in the U.S. District
Court for the Eastern District of New York, seeking, among other
things, a declaratory judgment that Sec. 203.50(a) erroneously
interprets the statutory requirement for pedigrees (21 U.S.C.
353(e)(1)(A)), and violates the U.S. Constitution's guarantees of equal
protection and due process. (RxUSA Wholesale, Inc. v. Dept. of Health
and Human Servs., 467 F. Supp.2d 285 (E.D.N.Y. 2006)). On November 22,
2006, the plaintiffs moved for a preliminary injunction against
implementation of the regulation, which, as noted previously, was
scheduled to become effective on December 1, 2006. On December 8, 2006,
the district court issued a preliminary injunction enjoining FDA from
implementing Sec. 203.50(a) (467 F.Supp. 2d at 292). The court
concluded that the statute, unlike Sec. 203.50(a), does not
``specifically or expressly require[] unauthorized distributors to
provide pedigree information all the way back to the manufacturer.''
467 F. Supp. 2d at 290 (emphasis in original). The court stated that
``[u]nauthorized distributors would be unable to comply with'' the
December 1999 final rule requirement to ``provide complete pedigree
information for all prior sales up to the manufacturer'' because
unauthorized distributors purchase drugs from authorized distributors
``who do not provide pedigree information.'' (467 F. Supp. 2d at 291).
The district court concluded that plaintiffs had shown a likelihood of
success on the merits of their claim because, in the court's view, the
pedigree regulation undermined the purpose of the statute and was
therefore arbitrary and capricious. (467 F. Supp. 2d at 291). The court
also found that issuance of the preliminary injunction would benefit
the public interest by preserving ``the status quo and the current
practice in the industry.'' (467 F. Supp. 2d at 292).
The Agency appealed the district court's preliminary injunction
order, but the district court's order was affirmed on July 10, 2008, by
the U.S. Court of Appeals for the Second Circuit. (See RxUSA Wholesale,
Inc., v. Dept. of Health and Human Servs., 285 Fed. Appx. 809 (2d Cir.
2008)). The appellate court explained that the PDMA ``does not
specifically state whether'' a pedigree must ``extend back to the
manufacturer, or whether it must only extend to the last authorized
distributor. The parties offer differing textual interpretations, but
we agree with the district court that for purposes of preliminary
injunction the statute's language does not unambiguously compel one
interpretation over another.'' (285 Fed. Appx. at 811). Moreover, the
second circuit concluded that the district court had not abused its
discretion in determining that the plaintiffs had shown a likelihood of
success on the merits because Sec. 203.50(a) requires unauthorized
distributors to ``provide pedigree information that is currently held
only by authorized distributors'' and the regulation is ``inconsistent
with the position taken by the agency in its original 1988 guidance
letter, and it runs directly counter to the 20-year history of industry
reliance on the FDA's initial position.'' (285 Fed. Appx. at 811).
The district court's preliminary injunction, as affirmed by the
circuit court, halted FDA's implementation of the requirements of Sec.
203.50(a). Specifically, the order enjoins FDA from implementing the
requirement in Sec. 203.50(a) that a pedigree identify each prior sale
or trade of a drug back to the drug's original manufacturer and the
requirement that specifies the types of information that must be
included in the pedigree, including lot numbers and container sizes.
Under the district court's order, unauthorized distributors are
only required to provide pedigrees that include information regarding
transactions going back to either the manufacturer or the last
authorized distributor of record that handled the drugs. In addition,
as specified in the FD&C Act, all pedigrees must include the dates of
the listed transactions and the names and addresses of all parties to
those transactions. We recognized that these circumstances resulting
from the court's order could lead to confusion and possible disruptions
or delays in the nation's drug distribution system for wholesale
distributors operating outside of the court's jurisdiction and could
provide an undue advantage to certain wholesaler distributors.
Therefore, we announced that we would exercise enforcement discretion
in a manner consistent with the court's opinion throughout the rest of
the country.
II. Proposed Regulation
FDA is now proposing to remove Sec. 203.50(a). Over the past 20
years, we have endeavored to ensure that the pedigree requirements in
our regulations are consistent with congressional intent and provide
appropriate accountability to protect our nation's drug supply. We have
made a good faith effort to implement the requirements in Sec.
203.50(a) consistent with the language of the PDMA through public
meetings, Federal Register documents requesting comments, meetings with
the wholesale industry, Members of Congress, and others, a Report to
Congress, and other actions. For the various reasons discussed earlier,
Sec. 203.50(a) has been effective for only a total of 7 days since the
finalization of the rule in 1999. As explained previously, there have
been serious ongoing concerns about the
[[Page 41437]]
effect that full implementation of the statutory pedigree requirements,
as codified in Sec. 203.50(a), would have on the nation's drug supply
and on wholesaler distributors. Therefore, in light of the courts'
opinions, we are proposing to remove Sec. 203.50(a).
By proposing to remove Sec. 203.50(a), we would remove the
requirement in the regulation that the pedigree identify each prior
sale or trade of a drug back to the drug's manufacturer. In addition,
this proposal would remove the requirement in the regulation that the
identifying statement include certain information, such as the
proprietary and established name of the drug, the dosage, container
size, number of containers, the drug's lot or control number(s), the
business name and address of all parties for each prior transaction,
starting with the manufacturer, and the date of each previous
transaction. While the rulemaking to remove the regulation is pending,
we intend to exercise enforcement discretion with respect to all of
these requirements in Sec. 203.50(a).
We note that even with the removal of Sec. 203.50(a), the pedigree
requirements of section 503(e)(1)(A) of the FD&C Act would still be in
effect. However, with respect to these statutory pedigree requirements,
the Agency intends to exercise enforcement discretion and not initiate
an enforcement action against any wholesalers for failing to provide a
pedigree that goes back to the manufacturer or for failing to include
the specific information listed in the regulation, as long as the
pedigree otherwise identifies the last authorized distributor of record
that handled the drugs and the associated dates of the transactions, as
well as the names and addresses of all unauthorized distributors that
handled the drug after the last authorized distributor, and the
corresponding dates of those transactions.
In summary, unauthorized distributors need to be aware that their
pedigree(s) must: (1) Include information regarding transactions going
back to either the manufacturer or the last authorized distributor of
record that handled the drugs, consistent with the preliminary
injunction order previously referenced and (2) include the date of the
transaction and the names and addresses of all parties to the
transaction as explicitly required under section 503(e)(1)(A) of the
FD&C Act. Furthermore, while FDA is proposing to remove Sec. 203.50(a)
and intends to exercise enforcement discretion under these described
circumstances with respect to the statutory requirements for a
pedigree, FDA encourages wholesalers to include the drug, dosage,
container size, number of containers, and the drug's lot or control
number(s) in the pedigree as well.
FDA continues to believe that drug supply chain security is of the
utmost importance and that transparency of transactions and
accountability are essential to further secure our nation's drug
supply. Counterfeit and diverted drugs continue to be found in our drug
supply chain and the action proposed in this document should not be
interpreted to mean that there is not a problem with counterfeit and
diverted drugs. Rather, FDA remains committed to the framework set
forth in the 2004 FDA Counterfeit Drug Task Force Report (Task Force
Report) and subsequent updates to that Task Force Report (https://www.fda.gov/Drugs/DrugSafety/ucm169825.htm) and will continue to move
forward, working with the private and public sectors to improve the
security of the drug supply chain and implement measures to further
protect Americans from counterfeit and diverted drugs. We also will
continue our efforts to implement the pharmaceutical security
provisions contained in section 913 of the Food and Drug Administration
Amendments Act of 2007.
As stated in the Task Force Report, such measures include
implementation of tracking and tracing, which would help secure the
integrity of the supply chain by providing an accurate electronic
record of transactions in the drug supply chain. Such electronic
records documenting the movement of a drug product from the
manufacturer to the dispenser would be an important step in preventing
counterfeit and diverted drugs from entering the drug supply chain. FDA
will continue to develop standards for the purpose of securing the drug
supply chain against counterfeit, diverted, subpotent, substandard,
adulterated, misbranded, or expired drugs, including standards for the
identification, validation, authentication, and tracking and tracing of
prescription drugs. We are not proposing any new provisions in lieu of
Sec. 203.50(a) at this time.
III. Legal Authority
FDA is issuing this proposed rule to remove the provisions in Sec.
203.50(a) under its rulemaking authority under section 701(a) of the
FD&C Act (21 U.S.C. 371) and based on those reasons provided in section
II of this document. Specifically, FDA can issue regulations through
its rulemaking authority to establish requirements for section 503(e)
of the FD&C Act. As described in section I of this document, FDA
previously issued a final rule establishing certain requirements for
section 503(e)(1)(a). Similarly, under its rulemaking authority, FDA
can propose to remove those specific requirements that have been
established by regulation. FDA is basing the proposed removal of Sec.
203.50(a) on the grounds described in section II of this document. As
explained earlier, the statutory provisions of section 503(e) of the
FD&C Act, as well as the other provisions of Sec. 203.50 that would
not be removed by this proposed rule, would remain legally effective.
IV. Analysis of Impacts
FDA has examined the impacts of the proposed rule under Executive
Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5
U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L.
104-4). Executive Orders 12866 and 13563 direct Agencies to assess all
costs and benefits of available regulatory alternatives and, when
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety, and other advantages; distributive impacts; and
equity). The Agency believes that this proposed rule is not a
significant regulatory action as defined by Executive Order 12866.
The Regulatory Flexibility Act requires Agencies to analyze
regulatory options that would minimize any significant impact of a rule
on small entities. Because the removal of the specified pedigree
requirements for prescription drug distribution in Sec. 203.50(a)
would not measurably decrease the estimated compliance costs of the
December 1999 final rule, the Agency proposes to certify that the final
rule will not have a significant economic impact on a substantial
number of small entities.
Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires
that Agencies prepare a written statement, which includes an assessment
of anticipated costs and benefits, before proposing ``any rule that
includes any Federal mandate that may result in the expenditure by
State, local, and tribal governments, in the aggregate, or by the
private sector, of $100,000,000 or more (adjusted annually for
inflation) in any one year.'' The current threshold after adjustment
for inflation is $136 million, using the most current (2010) Implicit
Price Deflator for the Gross Domestic Product. FDA does not expect this
proposed rule to result in any 1-year expenditure that would meet or
exceed this amount.
[[Page 41438]]
The Agency published a final rule on December 3, 1999, codified in
Sec. 203.50(a), that contained certain requirements concerning
prescription drug distribution. Specifically, it required that before
the wholesale distribution of any prescription drug to another
wholesale distributor or retail pharmacy for which the seller is not an
authorized distributor of record, the wholesale distributor must
provide to the purchaser a statement identifying each prior sale,
purchase or trade. Further, it contained a list of specific information
to be contained in the identifying statement. As explained previously,
this regulation is the subject of a preliminary injunction. In the
December 1999 final rule, the Agency estimated that the wholesale
distribution requirements, including the drug identifying (or origin)
statement and a separate distributor list to be provided by
manufacturers, would together impose $258,000 in annual recordkeeping
costs. In making this estimate, the Agency judged that the marginal
costs for the inclusion of the additional information that Sec.
203.50(a) would have required beyond that information that would be
required in the PDMA pedigree provision would be negligible, and did
not increase its cost estimate to reflect this additional effort. The
removal of Sec. 203.50(a), therefore, is expected to reduce compliance
costs by only that negligible amount that the Agency did not separately
estimate for the final rule, as the pedigree provision of the PDMA
still requires its own, slightly less expansive, pedigree provision.
This regulatory action that removes a provision of the December 1999
final rule is expected to reduce the previously estimated annual
compliance costs of $258,000 for this provision by a negligible, but
unquantified, amount.
V. Paperwork Reduction Act of 1995
FDA tentatively concludes that this proposed rule contains no
collection of information. Therefore, clearance by the Office of
Management and Budget under the Paperwork Reduction Act of 1995 is not
required.
VI. Environmental Impact
The Agency has determined under 21 CFR 25.30 this action is of a
type that does not individually or cumulatively have a significant
effect on the human environment. Therefore, neither an environmental
assessment nor an environmental impact statement is required.
VII. Federalism
FDA has analyzed this proposed rule in accordance with the
principles set forth in Executive Order 13132. FDA has determined that
the proposed rule, if finalized, would not contain policies that would
have substantial direct effects on the States, on the relationship
between the National Government and the States, or on the distribution
of power and responsibilities among the various levels of government.
Accordingly, the Agency tentatively concludes that the proposed rule
does not contain policies that have federalism implications as defined
in the Executive order and, consequently, a federalism summary impact
statement is not required.
VIII. Proposed Effective Date
The Agency is proposing that any final rule that may issue based
upon this proposed rule become effective upon its publication in the
Federal Register.
IX. Comments
Interested persons may submit to the Division of Dockets Management
(see ADDRESSES) either electronic or written comments regarding this
document. It is only necessary to send one set of comments. It is no
longer necessary to send two copies of mailed comments. Identify
comments with the docket number found in brackets in the heading of
this document. Received comments may be seen in the Division of Dockets
Management between 9 a.m. and 4 p.m., Monday through Friday.
List of Subjects in 21 CFR Part 203
Labeling, Prescription drugs, Reporting and recordkeeping
requirements, Warehouses.
Therefore, under the Federal Food, Drug, and Cosmetic Act and under
authority delegated to the Commissioner of Food and Drugs, it is
proposed that 21 CFR part 203 be amended as follows:
PART 203--PRESCRIPTION DRUG MARKETING
1. The authority citation for 21 CFR part 203 continues to read as
follows:
Authority: 21 U.S.C. 331, 333, 351, 352, 353, 360, 371, 374,
381.
Sec. 203.50 [Amended]
2. Section 203.50 is amended by removing and reserving paragraph
(a).
Dated: July 1, 2011.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2011-17696 Filed 7-13-11; 8:45 am]
BILLING CODE 4160-01-P