Notice of Issuance of Final Determination Concerning Wound Therapy System, 38718-38721 [2015-16553]

Download as PDF 38718 Federal Register / Vol. 80, No. 129 / Tuesday, July 7, 2015 / Notices Selection of Interventions for Review SAMHSA will select interventions for review from among submissions meeting the minimum requirements. In selecting interventions for review, SAMHSA may give special consideration to interventions that meet one or more of the following conditions: • More than one research study or evaluation has been conducted on the same or a similar target population that meets the minimum requirements. • The intervention targets underserved populations (e.g., minority populations, tribal communities or American Indian/Alaska Native populations, elderly individuals, young adults, individuals who are incarcerated, etc.). • Dissemination and implementation materials (e.g., program or practice manuals, training guides, measurement instruments, implementation fidelity tools) are available. Lower costs and nocost materials may be prioritized. • The intervention contributes to a content area in which few evidencebased interventions have been previously identified. Interventions that are not selected for review may be resubmitted by the applicant in a future open submission period. tkelley on DSK3SPTVN1PROD with NOTICES The Review Process The review process has been revised to improve the quality of the reviews and utility of information that NREPP can provide its users. In addition to articles and reports submitted by NREPP applicants, additional studies, articles, and evaluation reports regarding the interventions will be identified through literature searches. Studies and outcomes to be reviewed will be determined through the systematic application of standardized screening criteria, and the number of studies and outcomes to be reviewed will be expanded to more comprehensively represent the evidence base for the program or practice. Inclusion of studies and outcomes will no longer be limited to positive significant outcomes; all studies and outcomes that meet the standardized screening criteria will be reviewed, including those with negative and non-significant effects. Programs and practices will be assessed on the basis of evaluation studies of program or practice impact, information related to conceptual framework (that is, program or practice goals, theory of change, and program or practice components), and information about implementation fidelity (that is, whether a study employs quality assurance measures to declare that the program or practice is VerDate Sep<11>2014 20:31 Jul 06, 2015 Jkt 235001 delivered as intended to the program’s or practice’s target population). The methodological rigor (that is, internal validity, statistical validity, and measurement validity) of the research for each program or practice will be reviewed, as it pertains to each outcome examined, along with the magnitude and direction of the program’s or practice’s effect on each outcome. Based on this information, the program’s or practice’s effectiveness for each outcome will be rated, along with the rigor of the research examining the program or practice, and the ratings will be displayed on the NREPP Web site. In general, each NREPP evidence review will be conducted by two trained and certified reviewers. However, based on funding and available resources, SAMHSA use one reviewer for programs and practices being re-reviewed. When necessary, NREPP may conduct author queries to confirm or gather additional information needed for the review. Program and practice profiles will be developed on the basis of the information gathered. Applicants will have the opportunity to review the program or practice profile before it is posted on the NREPP site, but they will not have the option to refuse posting. Dissemination and implementation materials will no longer be rated as they were historically. Instead, descriptions of available materials for each program or practice, highlighting information that may be of most interest to NREPP users, will be included in the program or practice profile, along with information documenting the extent to which materials are available. Programs and practices currently posted on NREPP will be re-reviewed as time and resources permit but the rereviews of currently posted programs and practices will take place over the next few years. Detailed information about the revised review process will be available at http://www.nrepp.samhsa.gov after the re-launch of the new NREPP Web site. Enhancing the Learning Center NREPP’s Learning Center is a developing and underutilized component of the NREPP Web site. With the evolution and enhancement of the registry, SAMHSA seeks to bring greater recognition to both rigorously evaluated behavioral health interventions and those interventions that have been implemented, demonstrate promise, but have not necessarily been evaluated in a rigorous manner. To that end, the Learning Center is being significantly revamped to support stakeholder engagement and to become a shared PO 00000 Frm 00058 Fmt 4703 Sfmt 4703 learning environment for all stakeholders. SAMHSA recognizes that the successful promotion and dissemination of evidence-based programs and practices requires an environment that promotes community assessment, program and practice planning and evaluation, as well as guidance on the selection and implementation of programs and practices listed on NREPP. There are useful types of evaluation research, often conducted among underserved populations, which provide valuable insights for practitioners, but do not meet the minimum criteria required for experimental or quasi-experimental design. SAMHSA intends the Learning Center to be a forum for presenting research on emerging programs and practices, and exploring ways that preexperimental and qualitative research can complement and enrich findings from experimental and quasiexperimental research designs. An inventory of such programs and practices will be compiled and maintained within the Learning Center and will operate in parallel to the listing of reviewed programs and practices with experimental and quasiexperimental designs. In this way, SAMHSA intends to support programs and practices researched with the most rigorous approaches while also supporting the development of practicebased evidence, especially for certain populations and emerging practices that are critical to learning and improving behavioral health outcomes for persons with or at risk of developing behavioral health issues. Summer King, Statistician. [FR Doc. 2015–16573 Filed 7–6–15; 8:45 am] BILLING CODE 4162–20–P DEPARTMENT OF HOMELAND SECURITY U.S. Customs and Border Protection Notice of Issuance of Final Determination Concerning Wound Therapy System U.S. Customs and Border Protection, Department of Homeland Security. ACTION: Notice of final determination. AGENCY: This document provides notice that U.S. Customs and Border Protection (‘‘CBP’’) has issued a final determination concerning the country of origin of the PICO single use negative pressure wound therapy system manufactured and distributed by Smith SUMMARY: E:\FR\FM\07JYN1.SGM 07JYN1 Federal Register / Vol. 80, No. 129 / Tuesday, July 7, 2015 / Notices & Nephew. Based upon the facts presented, CBP has concluded that the United Kingdom will be the country of origin of the PICO single use negative pressure wound therapy system (‘‘PICO NPWT System’’) for purposes of U.S. Government procurement. The final determination was issued on June 30, 2015. A copy of the final determination is attached. Any party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial review of this final determination within August 6, 2015. DATES: FOR FURTHER INFORMATION CONTACT: Antonio J. Rivera, Valuation and Special Programs Branch, Regulations and Rulings, Office of International Trade (202) 325–0226. Notice is hereby given that on June 30, 2015 pursuant to subpart B of part 177, U.S. Customs and Border Protection Regulations (19 CFR part 177, subpart B), CBP has issued a final determination concerning the country of origin of the PICO NPWT System manufactured and distributed by Smith & Nephew, which may be offered to the U.S. Government under an undesignated government procurement contract. This final determination, HQ H259473, was issued under procedures set forth at 19 CFR part 177, subpart B, which implements Title III of the Trade Agreement Act of 1979, as amended (19 U.S.C. 2511–18). In the final determination, under the totality of the circumstances, considering the PICO NPWT System’s use as a single medical instrument, the origin of the dressings, and the flash programming and final assembly of the pump, which will be performed in the U.K., and will change the pump into a specialized pump that can only be used with its respective dressings, CBP concluded that the country of origin of the PICO NPWT System will be the United Kingdom for purposes of U.S. Government procurement. Section 177.29, CBP Regulations (19 CFR 177.29), provides that a notice of final determination shall be published in the Federal Register within 60 days of the date the final determination is issued. Section 177.30, CBP Regulations (19 CFR 177.30), provides that any party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial review of a final determination within 30 days of publication of such determination in the Federal Register. tkelley on DSK3SPTVN1PROD with NOTICES SUPPLEMENTARY INFORMATION: VerDate Sep<11>2014 20:31 Jul 06, 2015 Jkt 235001 Dated: June 30, 2015. Harold Singer, Acting Executive Director, Regulations and Rulings, Office of International Trade. HQ H259473 June 30, 2015 OT:RR:CTF:VS H259473 AJR CATEGORY: Origin Daniel S. Char, Esq. Associate General Counsel (Commercial) Smith and Nephew, PLC 150 Minuteman Road Andover, MA 01810 RE: Trade Agreements Act; Government Procurement; Country of Origin of the PICO Single Use Negative Pressure Wound Therapy System Dear Mr. Char: This is in response to your letter, dated November 19, 2014, requesting a final determination on behalf of Smith & Nephew, PLC (‘‘Smith & Nephew’’), pursuant to subpart B of part 177 of the U.S. Customs and Border Protection (‘‘CBP’’) Regulations (19 CFR part 177). Under these regulations, which implement Title III of the Trade Agreements Act of 1979 (‘‘TAA’’), as amended (19 U.S.C. 2511 et seq.), CBP issues country of origin advisory rulings and final determinations as to whether an article is or would be a product of a designated country or instrumentality for the purposes of granting waivers of certain ‘‘Buy American’’ restrictions in U.S. law or practice for products offered for sale to the U.S. Government. This final determination concerns the country of origin of Smith & Nephew’s PICO Single Use Negative Pressure Wound Therapy System (‘‘PICO NPWT System’’). As the manufacturer and U.S. importer, Smith & Nephew is a party-at-interest within the meaning of 19 CFR 177.22(d)(1) and is entitled to request this final determination. In addition, we have reviewed and grant the request for confidentiality pursuant to 19 CFR 177.2(b)(7), with respect to certain information submitted. FACTS: The PICO NPWT System is a sterile, singleuse, complete negative pressure wound therapy system consisting of a pump, two dressings with attached long tube assemblies, and retention strips. It is marketed for use in a sterile operating room environment. Each dressing is applied to the wound and held in place with the retention strips. The long tube assembly is attached to the dressing on one end, and to the PICO pump on the other end, connecting them together. The suction pump pulls air out of the dressing via the long tube assembly, creating negative pressure and drawing excess fluid from the wound into the dressing. The pump is battery powered and delivers 80 mmHg of continuous negative pressure for up to seven days, after which it is programmed to permanently stop working. Consistent with the lifespan of the pump, the dressings provide a total of seven days wear time. The pump in the PICO NPWT System can only be used with the dressings included PO 00000 Frm 00059 Fmt 4703 Sfmt 4703 38719 in the system, and will only be used once by a patient for a specific wound type as the therapy prescribes. The dressings are only sold with the pump and not separately available. Unlike conventional negative pressure systems that use canisters for the collection of wound fluid, the PICO NPWT System is canister-less, which according to your submission means that the components of the PICO NPWT System can only be used together as a system. The pump in the PICO NPWT System consists of: a printed circuit board (‘‘PCB’’) assembly that provides pressure measurement and feedback control for the pump; a diaphragm pump and motor that provide airflow to maintain pressure; components such as an internal air path and check valve; a plastic housing; and, batteries. Most of the pump’s components are made in China, except for a lightweight pipe, valve and connector made in the U.S., and the batteries. The pump components and subassemblies will be shipped from China to the United Kingdom (‘‘U.K.’’) for the remainder of the pump manufacturing process. In the U.K., U.S.-origin firmware, written and validated in the U.S. according to medical device and Food and Drug Administration standards, will be loaded onto the pump at flash programming stations. The flash programming stations are equipped with ‘‘bed of nails’’ interfaces, which have discrete electrical conductors that extend and make contact with discrete pads on the PCB assembly. You state that the erasable programmable read-only memory (‘‘EPROM’’) on the PCB assembly is actively programmed by sending electric charges through the ‘‘bed of nails’’ to the PCB assembly in order to drive the EPROM into receptive mode, and then sending byte by byte to program the EPROM with the unique calibrations and specific parameters required to operate the pump.1 You state that this process requires moderate, semi-skilled technicians trained in ‘‘clean-room’’ techniques and operating programming fixtures. The pump is then fully assembled by assembling the subassemblies with the case pieces and attaching the battery cover and label, which you state requires low, basic ‘‘box build’’ assembly techniques. After assembly, the pump goes through a series of tests to verify calibrated performance of the device, which you state requires moderate, semi-skilled technicians operating test fixtures. You state that the firmware is essential to the function of the pump because the firmware ensures that the pump dispenses the accurate amount of negative pressure. You state that while the components used to manufacture the PICO NPWT System are largely generic (e.g. micro-controllers, small battery powered motors and generic PCB assemblies), it is only when the pump is calibrated and then flashed with specific firmware that it becomes a true medical device, as the flashing enables the pump to deliver calibrated, therapeutic negative pressure levels to the wound. 1 You state that, though EPROM is not irreversible, re-programming EPROM requires working through different levels of encryption and the use of specific equipment, which is not readily available. E:\FR\FM\07JYN1.SGM 07JYN1 tkelley on DSK3SPTVN1PROD with NOTICES 38720 Federal Register / Vol. 80, No. 129 / Tuesday, July 7, 2015 / Notices You state that the material, labor, and overhead costs of the PICO NPWT System are broken down per country as follows: [XXXX]% from the pump and battery production in China, [XXXX]% from flashing and final assembly in the U.K., and the remaining [XXXX]% 2 mainly from the U.K. The dressings are manufactured in the U.K., with materials of U.K. and Canadian origin,3 to produce a four-layer dressing that consists of: (1) a high moisture vapor transfer rate (‘‘MTVR’’) film to allow for transpiration of the wound fluid; (2) a superabsorbent layer to hold the fluid; (3) an airlock layer to ensure consistent delivery of negative pressure from the pump to the wound bed; and, (4) an adhesive layer to maintain an effective seal around the dressing and prevent trauma. The manufacturing operations to produce the dressings involve extruding medical grade film, perforating the adhesive layer to ensure breathability of the dressing, and then shaping, cutting and laminating together the layers of the dressing. The four-layer dressing is then connected to a long tube assembly, which is also manufactured in the U.K. from U.K.-origin materials. The dressings and pumps are then sterilized, separately sealed, packed, and then re-sterilized. Once the PICO NPWT System is received by its user, the user will connect the pump to the dressing by the attached long tube assembly. You state that a majority of the essential therapeutic elements for wound healing are delivered via the unique dressing. You state that the dressing is the fundamental ‘‘enabling technology,’’ as the combination of layers work together to: manage the wound fluid; ensure consistent delivery of negative pressure from the pump to the wound bed (stimulating blood vessel and cell growth); and, maintain an optimal environment for wound healing by protecting the wound from outside contaminants and limiting disruption of the wound bed, which allows for the formation of granulation tissue. The PICO NPWT System is imported into the United States packaged for retail sale. Its main components, the pump and the dressings, are not assembled together and must be connected to each other by the user after the dressing is secured to the patient with the retention strips. You state that, as imported, the PICO NPWT System is classified in subheading 9018.90.80, Harmonized Tariff Schedule of the United States (‘‘HTSUS’’), as a medical instrument. You also state that it is described by two of the American Medical Association Current Procedural Terminology (‘‘CPT’’) codes, G0456 and G0457, which provide for: ‘‘negative pressure wound therapy (e.g. vacuum assisted drainage collection) using a [. . .] device, not durable medical equipment, including provision of [. . .] dressing(s), topical application(s), wound assessment, and instructions for ongoing care, per session.’’ According to your 2 [XXXX]% derives from the production of the dressing in the U.K. Aside from [XXXX]% for primary sterile barrier costs from both the U.K. and [XXXX], the remaining costs will be incurred in the U.K. 3 All of the layers, except for the super-absorbent layer that is from Canada, are from the U.K. VerDate Sep<11>2014 20:31 Jul 06, 2015 Jkt 235001 submission, the difference in the codes is based on the description of the size of the wound to be treated. ISSUE: What is the country of origin of the PICO NPWT System for purposes of U.S. Government procurement? LAW AND ANALYSIS: Pursuant to Subpart B of Part 177, 19 CFR 177.21 et seq., which implements Title III of the Trade Agreements Act of 1979, as amended (19 U.S.C. 2511 et seq.), CBP issues country of origin advisory rulings and final determinations as to whether an article is or would be a product of a designated country or instrumentality for the purposes of granting waivers of certain ‘‘Buy American’’ restrictions in U.S. law or practice for products offered for sale to the U.S. Government. Under the rule of origin set forth under 19 U.S.C. 2518(4)(B): An article is a product of a country or instrumentality only if (i) it is wholly the growth, product, or manufacture of that country or instrumentality, or (ii) in the case of an article which consists in whole or in part of materials from another country or instrumentality, it has been substantially transformed into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was so transformed. See also 19 CFR 177.22(a). In determining whether the combining of parts or materials constitutes a substantial transformation, the determinative issue is the extent of operations performed and whether the parts lose their identity and become an integral part of the new article. Belcrest Linens v. United States, 573 F. Supp. 1149 (Ct. Int’l Trade 1983), aff’d, 741 F.2d 1368 (Fed. Cir. 1984). Assembly operations that are minimal or simple, as opposed to complex or meaningful, will generally not result in a substantial transformation. See C.S.D. 80– 111, C.S.D. 85–25, C.S.D. 89–110, C.S.D. 89– 118, C.S.D. 90–51, and C.S.D. 90–97. If the manufacturing or combining process is a minor one which leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (1982), aff’d 702 F. 2d 1022 (Fed. Cir. 1983). In order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, CBP considers the totality of the circumstances and makes such determinations on a case-by-case basis. The country of origin of the item’s components, extent of the processing that occurs within a country, and whether such processing renders a product with a new name, character, and use are primary considerations in such cases. Additionally, factors such as the resources expended on product design and development, the extent and nature of post-assembly inspection and testing procedures, and worker skill required during the actual manufacturing process will be considered when determining whether a substantial transformation has occurred. No one factor is determinative. In this case, the PICO NPWT System is comprised of the pump and the dressings. PO 00000 Frm 00060 Fmt 4703 Sfmt 4703 These two components are attached to each other by the user and together, these two components are used as one product to extract fluid from the wound. The four-layer dressing is manufactured in the U.K. by combining MTVR film from the U.K. to allow for transpiration of the wound fluid, a superabsorbent layer from Canada to hold the fluid, an airlock layer from the U.K. to ensure consistent delivery of negative pressure from the pump to the wound bed, and an adhesive layer from the U.K. to effectively seal the dressing. The long tube assembly, which is produced in the U.K. from U.K. materials, is adhered to the dressing in the U.K. and is later connected by the user to the pump to create a one-way vacuum via a unique taperlock connector that ensures the pump and dressing can only connect to each other and not to other medical connectors. The pump is as important as the dressing in allowing negative pressure to be created and to enable fluid to be drawn from the wound. Therefore, the additional processes performed on the pump component are necessary in order to find that the PICO NPWT System is a product of the U.K. You argue that the PICO NPWT System should be considered a product of the U.K. because the U.K is the country of origin of the dressings, and that although the pump components and subassemblies will be made in China, the pump will be flash programmed with firmware and the final assembly of the pump will take place in the U.K. You state that the pump will be programmed with U.S.origin firmware at flash programming stations equipped with ‘‘bed of nails’’ interfaces, which have discrete electrical conductors that extend from the ‘‘bed of nails’’ and make contact with discrete pads on the PCB assembly.4 You state that the EPROM is actively programmed because this process sends electric charges through the ‘‘bed of nails’’ to the PCB assembly in order to drive the EPROM into receptive mode, and then sends byte by byte to program the EPROM with the unique calibrations and specific parameters required to operate the pump.5 You state that, though the EPROM is not irreversible, re-programming the EPROM requires working through different levels of 4 ‘‘Bed of nails’’ refers to a traditional electronic fixture with numerous pins extending from the fixture to make contact with points on a PCB. Pressing a PCB against a ‘‘bed of nails’’ interface allows the PCB to be directly accessed for programming. See Michael J. Smith, Why Program Devices at In-Circuit Test?, Evaluation Engineering, at http://www4.evaluationengineering.com/articles/ 201110/why-program-devices-at-in-circuit-test.php (specifically the ‘‘bed of nails’’ explanation); see also ‘‘In-Circuit Test,’’ Wikipedia, at http:// en.wikipedia.org/wiki/In-circuit_test (only with reference to ‘‘Bed of Nails tester’’ section). 5 EPROM refers to a non-volatile memory that retains its contents until it is exposed to ultraviolet light, and it is programmed by using a specialized machine to force an electric charge that sends bits of the EPROM onto a PCB. See G. Groeseneken, et al., Basics of Nonvolatile Semiconductor Memory Devices, 25–28, at http://citeseerx.ist.psu.edu/ viewdoc/download?doi=10.1.1.111.9431&rep=rep1 &type=pdf; see also Integrated Circuit Engineering Corporation, ROM, EPROM, and EEPROM Technology, 4–9, at https://web.eecs.umich.edu/ ∼prabal/teaching/eecs373-f10/readings/rom-epromeeprom-technology.pdf. E:\FR\FM\07JYN1.SGM 07JYN1 tkelley on DSK3SPTVN1PROD with NOTICES Federal Register / Vol. 80, No. 129 / Tuesday, July 7, 2015 / Notices encryption and the use of specific equipment, which is not readily available.6 Accordingly, you state that only when the pump is calibrated and flashed with specific firmware, it becomes a true medical device, as the flashing enables the pump to deliver calibrated, therapeutic negative pressure levels to the wound. In support of your positions you cite Headquarters Ruling (‘‘HQ’’) H034843, dated May 5, 2009; and HQ 968000, dated February 14, 2006. HQ H034843 concerned the country of origin of USB flash drives that used software and firmware developed in Israel and an assembly process that began in China and ended in Israel or the United States. CBP noted that the assembly in Israel or the United States, mainly the installation and customization of the firmware and software, made the USB flash drives functional, permitted them to execute their security features, and increased their value. Therefore, the USB flash drives were substantially transformed in the countries where these operations took place, making the country of origin for the USB flash drives either Israel or the United States. In HQ 968000, CBP ruled that the country of origin for marking purposes of a fabric switch for storage area networks was the United States. The assembly of the hardware for the switch occurred in China. Then, the resulting electromechanical assembly was shipped to the United States, where U.S.origin software was installed, configured, and tested. See also Data General v. United States, 4 Ct. Int’l Trade 182 (1982). As in HQ H034843 and HQ 968000, the firmware will be installed in a different country from where the majority of the product is assembled, thereby imparting the product (here, the pump) with an essential and required feature (here, enabling the pump to operate as a unique medical device). However, despite these similarities, HQ H034843 and HQ 968000 concerned a USB flash drive and a switch for network storage, which are instruments primarily associated with computer-related products, while in this case the product is primarily a medical instrument and serves separate functions apart from the programmed capabilities. For instance, in HQ H215657, dated April 29, 2013, CBP held that a flashlight originated from China despite the fact that it was programmed in the U.S. with U.S. software. HQ H215657 explained that the programming was not essential to the basic operation of the flashlight, as it only enhanced how the flashlight operated, without changing its fundamental nature. Though such programming provided the flashlight with some additional features, CBP held that the programming was not sufficiently complex to change the identity or characterize the device. Nonetheless, to the extent that the programming process in the U.K. is integrated with the U.K.-origin dressing to produce a specific-use medical device, we find that the last substantial transformation of the PICO NPWT System occurs in the U.K. The unique dressing is the ‘‘enabling technology’’ that provides the essential therapeutic elements for wound healing (e.g. fluid management, protecting against contaminants, and limiting wound bed disruption) to the instrument. Furthermore, the programmed pressure calibrations are critical to the pump’s function as a medical device, and can only tolerate a small margin for error since any programming error would devalue the pump for medical purposes and require correction via a difficult reprogramming technique. Based on the information in your request, under the totality of the circumstances, considering the PICO NPWT System’s use as a single medical instrument, the origin of the dressings, and the flash programming and final assembly of the pump, which will be performed in the U.K, and will change the pump into a specialized pump that can only be used with its respective dressings, we find that the country of origin of the PICO NPWT System will be the United Kingdom for purposes of U.S. Government procurement. HOLDING: Based on the facts in this case, we find that the country of origin of the PICO NPWT System will be the United Kingdom for purposes of U.S. Government procurement. Notice of this final determination will be given in the Federal Register, as required by 19 CFR 177.29. Any party-at-interest other than the party which requested this final determination may request, pursuant to 19 CFR 177.31, that CBP reexamine the matter anew and issue a new final determination. Pursuant to 19 CFR 177.30, any party-atinterest may, within 30 days of publication of the Federal Register Notice referenced above, seek judicial review of this final determination before the Court of International Trade. 6 EPROM is not easily reprogrammed because, even when the reprogramming change is minimal, the process requires erasing the memory by exposing the EPROM to ultraviolet light, and then reprogramming it byte by byte. See id. SUMMARY: VerDate Sep<11>2014 20:31 Jul 06, 2015 Jkt 235001 Sincerely, Harold Singer, Acting Executive Director Regulations and Rulings Office of International Trade [FR Doc. 2015–16553 Filed 7–6–15; 8:45 am] BILLING CODE 9111–14–P DEPARTMENT OF HOMELAND SECURITY Federal Emergency Management Agency [Docket ID FEMA–2015–0001; Internal Agency Docket No. FEMA–B–1515] Proposed Flood Hazard Determinations Federal Emergency Management Agency, DHS. ACTION: Notice. AGENCY: PO 00000 Frm 00061 Fmt 4703 Sfmt 4703 Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings. Comments are to be submitted on or before October 5, 2015 ADDRESSES: The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at www.msc.fema.gov for comparison. You may submit comments, identified by Docket No. FEMA–B–1515, to Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email) Luis.Rodriguez3@fema.dhs.gov. FOR FURTHER INFORMATION CONTACT: Luis Rodriguez, Chief, Engineering Management Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646–4064, or (email) Luis.Rodriguez3@fema.dhs.gov; or visit the FEMA Map Information eXchange (FMIX) online at www.floodmaps.fema.gov/fhm/fmx_ main.html. DATES: FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a). SUPPLEMENTARY INFORMATION: Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood 38721 E:\FR\FM\07JYN1.SGM 07JYN1

Agencies

[Federal Register Volume 80, Number 129 (Tuesday, July 7, 2015)]
[Notices]
[Pages 38718-38721]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-16553]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Notice of Issuance of Final Determination Concerning Wound 
Therapy System

AGENCY: U.S. Customs and Border Protection, Department of Homeland 
Security.

ACTION: Notice of final determination.

-----------------------------------------------------------------------

SUMMARY: This document provides notice that U.S. Customs and Border 
Protection (``CBP'') has issued a final determination concerning the 
country of origin of the PICO single use negative pressure wound 
therapy system manufactured and distributed by Smith

[[Page 38719]]

& Nephew. Based upon the facts presented, CBP has concluded that the 
United Kingdom will be the country of origin of the PICO single use 
negative pressure wound therapy system (``PICO NPWT System'') for 
purposes of U.S. Government procurement.

DATES: The final determination was issued on June 30, 2015. A copy of 
the final determination is attached. Any party-at-interest, as defined 
in 19 CFR 177.22(d), may seek judicial review of this final 
determination within August 6, 2015.

FOR FURTHER INFORMATION CONTACT: Antonio J. Rivera, Valuation and 
Special Programs Branch, Regulations and Rulings, Office of 
International Trade (202) 325-0226.

SUPPLEMENTARY INFORMATION: Notice is hereby given that on June 30, 2015 
pursuant to subpart B of part 177, U.S. Customs and Border Protection 
Regulations (19 CFR part 177, subpart B), CBP has issued a final 
determination concerning the country of origin of the PICO NPWT System 
manufactured and distributed by Smith & Nephew, which may be offered to 
the U.S. Government under an undesignated government procurement 
contract. This final determination, HQ H259473, was issued under 
procedures set forth at 19 CFR part 177, subpart B, which implements 
Title III of the Trade Agreement Act of 1979, as amended (19 U.S.C. 
2511-18). In the final determination, under the totality of the 
circumstances, considering the PICO NPWT System's use as a single 
medical instrument, the origin of the dressings, and the flash 
programming and final assembly of the pump, which will be performed in 
the U.K., and will change the pump into a specialized pump that can 
only be used with its respective dressings, CBP concluded that the 
country of origin of the PICO NPWT System will be the United Kingdom 
for purposes of U.S. Government procurement.
    Section 177.29, CBP Regulations (19 CFR 177.29), provides that a 
notice of final determination shall be published in the Federal 
Register within 60 days of the date the final determination is issued. 
Section 177.30, CBP Regulations (19 CFR 177.30), provides that any 
party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial 
review of a final determination within 30 days of publication of such 
determination in the Federal Register.

    Dated: June 30, 2015.
Harold Singer,
Acting Executive Director, Regulations and Rulings, Office of 
International Trade.

HQ H259473

June 30, 2015

OT:RR:CTF:VS H259473 AJR

CATEGORY: Origin

Daniel S. Char, Esq.
Associate General Counsel (Commercial)
Smith and Nephew, PLC
150 Minuteman Road
Andover, MA 01810

RE: Trade Agreements Act; Government Procurement; Country of Origin 
of the PICO Single Use Negative Pressure Wound Therapy System

Dear Mr. Char:

    This is in response to your letter, dated November 19, 2014, 
requesting a final determination on behalf of Smith & Nephew, PLC 
(``Smith & Nephew''), pursuant to subpart B of part 177 of the U.S. 
Customs and Border Protection (``CBP'') Regulations (19 CFR part 
177). Under these regulations, which implement Title III of the 
Trade Agreements Act of 1979 (``TAA''), as amended (19 U.S.C. 2511 
et seq.), CBP issues country of origin advisory rulings and final 
determinations as to whether an article is or would be a product of 
a designated country or instrumentality for the purposes of granting 
waivers of certain ``Buy American'' restrictions in U.S. law or 
practice for products offered for sale to the U.S. Government.
    This final determination concerns the country of origin of Smith 
& Nephew's PICO Single Use Negative Pressure Wound Therapy System 
(``PICO NPWT System''). As the manufacturer and U.S. importer, Smith 
& Nephew is a party-at-interest within the meaning of 19 CFR 
177.22(d)(1) and is entitled to request this final determination. In 
addition, we have reviewed and grant the request for confidentiality 
pursuant to 19 CFR 177.2(b)(7), with respect to certain information 
submitted.

FACTS:

    The PICO NPWT System is a sterile, single-use, complete negative 
pressure wound therapy system consisting of a pump, two dressings 
with attached long tube assemblies, and retention strips. It is 
marketed for use in a sterile operating room environment. Each 
dressing is applied to the wound and held in place with the 
retention strips. The long tube assembly is attached to the dressing 
on one end, and to the PICO pump on the other end, connecting them 
together. The suction pump pulls air out of the dressing via the 
long tube assembly, creating negative pressure and drawing excess 
fluid from the wound into the dressing. The pump is battery powered 
and delivers 80 mmHg of continuous negative pressure for up to seven 
days, after which it is programmed to permanently stop working. 
Consistent with the lifespan of the pump, the dressings provide a 
total of seven days wear time. The pump in the PICO NPWT System can 
only be used with the dressings included in the system, and will 
only be used once by a patient for a specific wound type as the 
therapy prescribes. The dressings are only sold with the pump and 
not separately available. Unlike conventional negative pressure 
systems that use canisters for the collection of wound fluid, the 
PICO NPWT System is canister-less, which according to your 
submission means that the components of the PICO NPWT System can 
only be used together as a system.
    The pump in the PICO NPWT System consists of: a printed circuit 
board (``PCB'') assembly that provides pressure measurement and 
feedback control for the pump; a diaphragm pump and motor that 
provide airflow to maintain pressure; components such as an internal 
air path and check valve; a plastic housing; and, batteries. Most of 
the pump's components are made in China, except for a lightweight 
pipe, valve and connector made in the U.S., and the batteries. The 
pump components and subassemblies will be shipped from China to the 
United Kingdom (``U.K.'') for the remainder of the pump 
manufacturing process. In the U.K., U.S.-origin firmware, written 
and validated in the U.S. according to medical device and Food and 
Drug Administration standards, will be loaded onto the pump at flash 
programming stations. The flash programming stations are equipped 
with ``bed of nails'' interfaces, which have discrete electrical 
conductors that extend and make contact with discrete pads on the 
PCB assembly. You state that the erasable programmable read-only 
memory (``EPROM'') on the PCB assembly is actively programmed by 
sending electric charges through the ``bed of nails'' to the PCB 
assembly in order to drive the EPROM into receptive mode, and then 
sending byte by byte to program the EPROM with the unique 
calibrations and specific parameters required to operate the 
pump.\1\ You state that this process requires moderate, semi-skilled 
technicians trained in ``clean-room'' techniques and operating 
programming fixtures. The pump is then fully assembled by assembling 
the subassemblies with the case pieces and attaching the battery 
cover and label, which you state requires low, basic ``box build'' 
assembly techniques. After assembly, the pump goes through a series 
of tests to verify calibrated performance of the device, which you 
state requires moderate, semi-skilled technicians operating test 
fixtures.
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    \1\ You state that, though EPROM is not irreversible, re-
programming EPROM requires working through different levels of 
encryption and the use of specific equipment, which is not readily 
available.
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    You state that the firmware is essential to the function of the 
pump because the firmware ensures that the pump dispenses the 
accurate amount of negative pressure. You state that while the 
components used to manufacture the PICO NPWT System are largely 
generic (e.g. micro-controllers, small battery powered motors and 
generic PCB assemblies), it is only when the pump is calibrated and 
then flashed with specific firmware that it becomes a true medical 
device, as the flashing enables the pump to deliver calibrated, 
therapeutic negative pressure levels to the wound.

[[Page 38720]]

    You state that the material, labor, and overhead costs of the 
PICO NPWT System are broken down per country as follows: [XXXX]% 
from the pump and battery production in China, [XXXX]% from flashing 
and final assembly in the U.K., and the remaining [XXXX]% \2\ mainly 
from the U.K.
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    \2\ [XXXX]% derives from the production of the dressing in the 
U.K. Aside from [XXXX]% for primary sterile barrier costs from both 
the U.K. and [XXXX], the remaining costs will be incurred in the 
U.K.
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    The dressings are manufactured in the U.K., with materials of 
U.K. and Canadian origin,\3\ to produce a four-layer dressing that 
consists of: (1) a high moisture vapor transfer rate (``MTVR'') film 
to allow for transpiration of the wound fluid; (2) a superabsorbent 
layer to hold the fluid; (3) an airlock layer to ensure consistent 
delivery of negative pressure from the pump to the wound bed; and, 
(4) an adhesive layer to maintain an effective seal around the 
dressing and prevent trauma. The manufacturing operations to produce 
the dressings involve extruding medical grade film, perforating the 
adhesive layer to ensure breathability of the dressing, and then 
shaping, cutting and laminating together the layers of the dressing. 
The four-layer dressing is then connected to a long tube assembly, 
which is also manufactured in the U.K. from U.K.-origin materials. 
The dressings and pumps are then sterilized, separately sealed, 
packed, and then re-sterilized. Once the PICO NPWT System is 
received by its user, the user will connect the pump to the dressing 
by the attached long tube assembly.
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    \3\ All of the layers, except for the super-absorbent layer that 
is from Canada, are from the U.K.
---------------------------------------------------------------------------

    You state that a majority of the essential therapeutic elements 
for wound healing are delivered via the unique dressing. You state 
that the dressing is the fundamental ``enabling technology,'' as the 
combination of layers work together to: manage the wound fluid; 
ensure consistent delivery of negative pressure from the pump to the 
wound bed (stimulating blood vessel and cell growth); and, maintain 
an optimal environment for wound healing by protecting the wound 
from outside contaminants and limiting disruption of the wound bed, 
which allows for the formation of granulation tissue.
    The PICO NPWT System is imported into the United States packaged 
for retail sale. Its main components, the pump and the dressings, 
are not assembled together and must be connected to each other by 
the user after the dressing is secured to the patient with the 
retention strips. You state that, as imported, the PICO NPWT System 
is classified in subheading 9018.90.80, Harmonized Tariff Schedule 
of the United States (``HTSUS''), as a medical instrument. You also 
state that it is described by two of the American Medical 
Association Current Procedural Terminology (``CPT'') codes, G0456 
and G0457, which provide for: ``negative pressure wound therapy 
(e.g. vacuum assisted drainage collection) using a [. . .] device, 
not durable medical equipment, including provision of [. . .] 
dressing(s), topical application(s), wound assessment, and 
instructions for ongoing care, per session.'' According to your 
submission, the difference in the codes is based on the description 
of the size of the wound to be treated.

ISSUE:

    What is the country of origin of the PICO NPWT System for 
purposes of U.S. Government procurement?

LAW AND ANALYSIS:

    Pursuant to Subpart B of Part 177, 19 CFR 177.21 et seq., which 
implements Title III of the Trade Agreements Act of 1979, as amended 
(19 U.S.C. 2511 et seq.), CBP issues country of origin advisory 
rulings and final determinations as to whether an article is or 
would be a product of a designated country or instrumentality for 
the purposes of granting waivers of certain ``Buy American'' 
restrictions in U.S. law or practice for products offered for sale 
to the U.S. Government.
    Under the rule of origin set forth under 19 U.S.C. 2518(4)(B):
    An article is a product of a country or instrumentality only if 
(i) it is wholly the growth, product, or manufacture of that country 
or instrumentality, or (ii) in the case of an article which consists 
in whole or in part of materials from another country or 
instrumentality, it has been substantially transformed into a new 
and different article of commerce with a name, character, or use 
distinct from that of the article or articles from which it was so 
transformed.
    See also 19 CFR 177.22(a).
    In determining whether the combining of parts or materials 
constitutes a substantial transformation, the determinative issue is 
the extent of operations performed and whether the parts lose their 
identity and become an integral part of the new article. Belcrest 
Linens v. United States, 573 F. Supp. 1149 (Ct. Int'l Trade 1983), 
aff'd, 741 F.2d 1368 (Fed. Cir. 1984). Assembly operations that are 
minimal or simple, as opposed to complex or meaningful, will 
generally not result in a substantial transformation. See C.S.D. 80-
111, C.S.D. 85-25, C.S.D. 89-110, C.S.D. 89-118, C.S.D. 90-51, and 
C.S.D. 90-97. If the manufacturing or combining process is a minor 
one which leaves the identity of the article intact, a substantial 
transformation has not occurred. Uniroyal, Inc. v. United States, 3 
CIT 220, 542 F. Supp. 1026 (1982), aff'd 702 F. 2d 1022 (Fed. Cir. 
1983).
    In order to determine whether a substantial transformation 
occurs when components of various origins are assembled into 
completed products, CBP considers the totality of the circumstances 
and makes such determinations on a case-by-case basis. The country 
of origin of the item's components, extent of the processing that 
occurs within a country, and whether such processing renders a 
product with a new name, character, and use are primary 
considerations in such cases. Additionally, factors such as the 
resources expended on product design and development, the extent and 
nature of post-assembly inspection and testing procedures, and 
worker skill required during the actual manufacturing process will 
be considered when determining whether a substantial transformation 
has occurred. No one factor is determinative.
    In this case, the PICO NPWT System is comprised of the pump and 
the dressings. These two components are attached to each other by 
the user and together, these two components are used as one product 
to extract fluid from the wound. The four-layer dressing is 
manufactured in the U.K. by combining MTVR film from the U.K. to 
allow for transpiration of the wound fluid, a superabsorbent layer 
from Canada to hold the fluid, an airlock layer from the U.K. to 
ensure consistent delivery of negative pressure from the pump to the 
wound bed, and an adhesive layer from the U.K. to effectively seal 
the dressing. The long tube assembly, which is produced in the U.K. 
from U.K. materials, is adhered to the dressing in the U.K. and is 
later connected by the user to the pump to create a one-way vacuum 
via a unique taper-lock connector that ensures the pump and dressing 
can only connect to each other and not to other medical connectors. 
The pump is as important as the dressing in allowing negative 
pressure to be created and to enable fluid to be drawn from the 
wound. Therefore, the additional processes performed on the pump 
component are necessary in order to find that the PICO NPWT System 
is a product of the U.K.
    You argue that the PICO NPWT System should be considered a 
product of the U.K. because the U.K is the country of origin of the 
dressings, and that although the pump components and subassemblies 
will be made in China, the pump will be flash programmed with 
firmware and the final assembly of the pump will take place in the 
U.K. You state that the pump will be programmed with U.S.-origin 
firmware at flash programming stations equipped with ``bed of 
nails'' interfaces, which have discrete electrical conductors that 
extend from the ``bed of nails'' and make contact with discrete pads 
on the PCB assembly.\4\ You state that the EPROM is actively 
programmed because this process sends electric charges through the 
``bed of nails'' to the PCB assembly in order to drive the EPROM 
into receptive mode, and then sends byte by byte to program the 
EPROM with the unique calibrations and specific parameters required 
to operate the pump.\5\ You state that, though the EPROM is not 
irreversible, re-programming the EPROM requires working through 
different levels of

[[Page 38721]]

encryption and the use of specific equipment, which is not readily 
available.\6\ Accordingly, you state that only when the pump is 
calibrated and flashed with specific firmware, it becomes a true 
medical device, as the flashing enables the pump to deliver 
calibrated, therapeutic negative pressure levels to the wound. In 
support of your positions you cite Headquarters Ruling (``HQ'') 
H034843, dated May 5, 2009; and HQ 968000, dated February 14, 2006.
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    \4\ ``Bed of nails'' refers to a traditional electronic fixture 
with numerous pins extending from the fixture to make contact with 
points on a PCB. Pressing a PCB against a ``bed of nails'' interface 
allows the PCB to be directly accessed for programming. See Michael 
J. Smith, Why Program Devices at In-Circuit Test?, Evaluation 
Engineering, at http://www4.evaluationengineering.com/articles/201110/why-program-devices-at-in-circuit-test.php (specifically the 
``bed of nails'' explanation); see also ``In-Circuit Test,'' 
Wikipedia, at http://en.wikipedia.org/wiki/In-circuit_test (only 
with reference to ``Bed of Nails tester'' section).
    \5\ EPROM refers to a non-volatile memory that retains its 
contents until it is exposed to ultraviolet light, and it is 
programmed by using a specialized machine to force an electric 
charge that sends bits of the EPROM onto a PCB. See G. Groeseneken, 
et al., Basics of Nonvolatile Semiconductor Memory Devices, 25-28, 
at http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.111.9431&rep=rep1&type=pdf; see also Integrated 
Circuit Engineering Corporation, ROM, EPROM, and EEPROM Technology, 
4-9, at https://web.eecs.umich.edu/~prabal/teaching/eecs373-f10/
readings/rom-eprom-eeprom-technology.pdf.
    \6\ EPROM is not easily reprogrammed because, even when the 
reprogramming change is minimal, the process requires erasing the 
memory by exposing the EPROM to ultraviolet light, and then 
reprogramming it byte by byte. See id.
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    HQ H034843 concerned the country of origin of USB flash drives 
that used software and firmware developed in Israel and an assembly 
process that began in China and ended in Israel or the United 
States. CBP noted that the assembly in Israel or the United States, 
mainly the installation and customization of the firmware and 
software, made the USB flash drives functional, permitted them to 
execute their security features, and increased their value. 
Therefore, the USB flash drives were substantially transformed in 
the countries where these operations took place, making the country 
of origin for the USB flash drives either Israel or the United 
States.
    In HQ 968000, CBP ruled that the country of origin for marking 
purposes of a fabric switch for storage area networks was the United 
States. The assembly of the hardware for the switch occurred in 
China. Then, the resulting electromechanical assembly was shipped to 
the United States, where U.S.-origin software was installed, 
configured, and tested. See also Data General v. United States, 4 
Ct. Int'l Trade 182 (1982).
    As in HQ H034843 and HQ 968000, the firmware will be installed 
in a different country from where the majority of the product is 
assembled, thereby imparting the product (here, the pump) with an 
essential and required feature (here, enabling the pump to operate 
as a unique medical device). However, despite these similarities, HQ 
H034843 and HQ 968000 concerned a USB flash drive and a switch for 
network storage, which are instruments primarily associated with 
computer-related products, while in this case the product is 
primarily a medical instrument and serves separate functions apart 
from the programmed capabilities. For instance, in HQ H215657, dated 
April 29, 2013, CBP held that a flashlight originated from China 
despite the fact that it was programmed in the U.S. with U.S. 
software. HQ H215657 explained that the programming was not 
essential to the basic operation of the flashlight, as it only 
enhanced how the flashlight operated, without changing its 
fundamental nature. Though such programming provided the flashlight 
with some additional features, CBP held that the programming was not 
sufficiently complex to change the identity or characterize the 
device.
    Nonetheless, to the extent that the programming process in the 
U.K. is integrated with the U.K.-origin dressing to produce a 
specific-use medical device, we find that the last substantial 
transformation of the PICO NPWT System occurs in the U.K. The unique 
dressing is the ``enabling technology'' that provides the essential 
therapeutic elements for wound healing (e.g. fluid management, 
protecting against contaminants, and limiting wound bed disruption) 
to the instrument. Furthermore, the programmed pressure calibrations 
are critical to the pump's function as a medical device, and can 
only tolerate a small margin for error since any programming error 
would devalue the pump for medical purposes and require correction 
via a difficult reprogramming technique.
    Based on the information in your request, under the totality of 
the circumstances, considering the PICO NPWT System's use as a 
single medical instrument, the origin of the dressings, and the 
flash programming and final assembly of the pump, which will be 
performed in the U.K, and will change the pump into a specialized 
pump that can only be used with its respective dressings, we find 
that the country of origin of the PICO NPWT System will be the 
United Kingdom for purposes of U.S. Government procurement.

HOLDING:

    Based on the facts in this case, we find that the country of 
origin of the PICO NPWT System will be the United Kingdom for 
purposes of U.S. Government procurement.
    Notice of this final determination will be given in the Federal 
Register, as required by 19 CFR 177.29. Any party-at-interest other 
than the party which requested this final determination may request, 
pursuant to 19 CFR 177.31, that CBP reexamine the matter anew and 
issue a new final determination. Pursuant to 19 CFR 177.30, any 
party-at-interest may, within 30 days of publication of the Federal 
Register Notice referenced above, seek judicial review of this final 
determination before the Court of International Trade.

Sincerely,

Harold Singer, Acting Executive Director
Regulations and Rulings
Office of International Trade

[FR Doc. 2015-16553 Filed 7-6-15; 8:45 am]
BILLING CODE 9111-14-P