Over-the-Counter Monograph Drug User Fee Program-Facility Fee Rates for Fiscal Year 2024, 22156-22160 [2024-06723]

Download as PDF 22156 Federal Register / Vol. 89, No. 62 / Friday, March 29, 2024 / Notices Therefore, approval of the applications listed in the table, and all amendments and supplements thereto, is hereby withdrawn as of April 29, 2024. Approval of each entire application is withdrawn, including any strengths and dosage forms inadvertently missing from the table. Introduction or delivery for introduction into interstate commerce of products listed in the table without an approved new drug application or ANDA violates sections 505(a) and 301(d) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(a) and 331(d)). Drug products that are listed in the table that are in inventory on April 29, 2024 may continue to be dispensed until the inventories have been depleted or the drug products have reached their expiration dates or otherwise become violative, whichever occurs first. Dated: March 26, 2024. Lauren K. Roth, Associate Commissioner for Policy. [FR Doc. 2024–06730 Filed 3–28–24; 8:45 am] BILLING CODE 4164–01–P DEPARTMENT OF HEALTH AND HUMAN SERVICES Food and Drug Administration [Docket No. FDA–2024–N–1298] Over-the-Counter Monograph Drug User Fee Program—Facility Fee Rates for Fiscal Year 2024 AGENCY: Food and Drug Administration, HHS. ACTION: Notice. The Food and Drug Administration (FDA or the Agency) is announcing the over-the-counter (OTC) monograph drug facility (MDF) fee rates under the OTC monograph drug user fee program (OMUFA) for fiscal year (FY) 2024. The Federal Food, Drug, and Cosmetic Act (FD&C Act) authorizes FDA to assess and collect user fees from qualifying manufacturers of OTC monograph drugs and submitters of OTC monograph order requests (OMORs). This notice publishes the OMUFA facility fee rates for FY 2024. DATES: These facility fees are effective on October 1, 2023, and will remain in effect through September 30, 2024. FOR FURTHER INFORMATION CONTACT: Olufunmilayo (Funmi) Ariyo, Office of Financial Management, Food and Drug Administration, 4041 Powder Mill Rd., 6th Floor, Beltsville, MD 20705–4304, 240–402–4989; or the User Fees Support Staff at OO-OFBAP-OFM-UFSSGovernment@fda.hhs.gov. khammond on DSKJM1Z7X2PROD with NOTICES SUMMARY: VerDate Sep<11>2014 16:49 Mar 28, 2024 Jkt 262001 SUPPLEMENTARY INFORMATION: I. Background Section 744M of the FD&C Act (21 U.S.C. 379j–72), authorizes FDA to assess and collect: (1) facility fees from qualifying owners of OTC monograph drug facilities and (2) fees from submitters of qualifying OTC OMORs. The OTC OMOR fee rates for FY 2024 were published on September 12, 2023.1 These fees are to support FDA’s OTC monograph drug activities, which are detailed in section 744L(6) of the FD&C Act (21 U.S.C. 379j–71(6)) and include various FDA activities associated with OTC monograph drugs. For OMUFA purposes: • An OTC monograph drug is a nonprescription drug without an approved new drug application that is governed by the provisions of section 505G of the FD&C Act (21 U.S.C. 355h) (see section 744L(5) of the FD&C Act); • An OTC MDF is a foreign or domestic business or other entity that, in addition to meeting other criteria, is engaged in manufacturing or processing the finished dosage form of an OTC monograph drug (see section 744L(10) of the FD&C Act); and • A contract manufacturing organization (CMO) facility is an OTC monograph drug facility where neither the owner nor any affiliate of the owner or facility sells the OTC monograph drug produced at such facility directly to wholesalers, retailers, or consumers in the United States (see section 744L(2) of the FD&C Act). Under section 744M(a)(1)(A) of the FD&C Act, a facility fee for FY 2024 shall be assessed with respect to each facility that is identified as an OTC monograph drug facility during the feeliable period from January 1, 2023, through December 31, 2023.2 Consistent with the statute, FDA will assess and collect facility fees with respect to the two types of OTC monograph drug facilities—MDF and CMO facilities. A full facility fee will be assessed to each qualifying person that owns a facility identified as an MDF (see section 744M(a)(1)(A) of the FD&C Act), and a reduced facility fee of two-thirds will be assessed to each qualifying person that owns a facility identified as a CMO 1 https://www.federalregister.gov/documents/ 2023/09/12/2023-19609/over-the-countermonograph-drug-user-fee-program-otc-monographorder-requests-fee-rates-for-fiscal. 2 Under section 744M(a)(1) of the FD&C Act, ‘‘Each person that owns a facility identified as an OTC monograph drug facility on December 31 of the fiscal year or at any time during the preceding 12-month period shall be assessed an annual fee for each such facility.’’ For purposes of FY 2024 facility fees, that time period is January 1, 2023, through December 31, 2023. PO 00000 Frm 00041 Fmt 4703 Sfmt 4703 facility (see section 744M(a)(1)(B)(ii) of the FD&C Act). The facility fees for FY 2024 are due on June 3, 2024 (see section 744M(a)(1)(D)(ii) of the FD&C Act).3 As discussed in greater detail below: • OTC monograph drug facilities are exempt from FY 2024 facility fees if they had ceased OTC monograph drug activities, and updated their registration with FDA to that effect, prior to December 31, 2022 (see section 744M(a)(1)(B)(i) of the FD&C Act). • Entities that registered with FDA during the Coronavirus Disease 2019 (COVID–19) pandemic whose sole activity with respect to OTC monograph drugs during the pandemic consists (or had consisted) of manufacturing OTC hand sanitizer products 4 are not identified as OTC monograph drug facilities subject to OMUFA facility fees for FY 2024.5 For FY 2024, the OMUFA facility fee rates are: MDF facility fees ($34,166) and CMO facility fees ($22,777). These fees are effective for the period from October 1, 2023, through September 30, 2024.6 This document is issued pursuant to section 744M(a)(4) and 744M(c)(4)(B) of the FD&C Act and describes the calculations used to set the OMUFA facility fees for FY 2024 in accordance with the directives in the statute. II. Facility Fee Revenue Amount for FY 2024 A. Base Fee Revenue Amount Under OMUFA, FDA sets annual facility fees to generate the total facility fee revenues for each fiscal year 3 Assuming that, as we anticipate, the FY 2024 fee appropriation will occur prior to June 3, 2024. Under section 744M(a)(1)(D)(ii), the FY 2024 facility fees are due on the later of: (1) the first business day of June 2024 (i.e., June 3, 2024) or (2) the first business day after the enactment of an appropriations Act providing for the collection and obligation of FY 2024 OMUFA fees. 4 The term ‘‘hand sanitizer’’ commonly refers to consumer antiseptic rubs. However, because the Department of Health and Human Services (HHS) notice published January 12, 2021, referred to ‘‘persons that entered the over-the-counter drug market to supply hand sanitizer products in response to the COVID–19 Public Health Emergency’’ (86 FR 2420 https://www.federal register.gov/documents/2021/01/12/2021-00237/ notice-that-persons-that-entered-the-over-thecounter-drug-market-to-supply-hand-sanitizerduring), we are using the same terminology—‘‘hand sanitizer products’’—to refer to OTC monograph drug products intended for use (without water) as antiseptic hand rubs or antiseptic hand wipes by consumers or healthcare personnel. 5 See HHS Federal Register notice of January 12, 2021, 86 FR 2420, https://www.federalregister.gov/ documents/2021/01/12/2021-00237/notice-thatpersons-that-entered-the-over-the-counter-drugmarket-to-supply-hand-sanitizer-during. 6 These OMUFA fees are for FY 2024, per section 744M(a) of the FD&C Act. E:\FR\FM\29MRN1.SGM 29MRN1 22157 Federal Register / Vol. 89, No. 62 / Friday, March 29, 2024 / Notices established by section 744M(b) of the FD&C Act. The yearly base revenue amount is the starting point for setting annual facility fee rates. The base revenue for FY 2024 is the dollar amount of the total revenue amount for the previous fiscal year, without certain adjustments made for that previous year, and is $21,421,133 (see section 744M(b)(3)(B) of the FD&C Act). B. Fee Revenue Adjustment for Inflation Under OMUFA, the annual base revenue amount for facility fees is adjusted for inflation for FY 2024 and each subsequent fiscal year (see section 744M(c)(1) of the FD&C Act). That provision states that the dollar amount of the inflation adjustment is equal to the product of the annual base revenue for the fiscal year and the inflation adjustment percentage. For FY 2024 the inflation adjustment percentage is the sum of: • (I) the average annual percent change in cost, per full-time equivalent (FTE) position of FDA, of all personnel compensation and benefits paid with respect to such positions for the first 3 years of the preceding 4 fiscal years, multiplied by the proportion of personnel compensation and benefits (PC&B) costs to total costs of the OTC monograph drug activities for the first 3 years of the preceding 4 fiscal years (see section 744M(c)(1)(C)(ii)(I) of the FD&C Act); and • (II) the average annual percent change that occurred in the Consumer Price Index (CPI) for urban consumers (Washington-Baltimore, DC-MD-VAWV; Not Seasonally Adjusted; All items; Annual Index) for the first 3 years of the preceding 4 years of available data multiplied by the proportion of all costs other than personnel compensation and benefits costs to total costs of OTC monograph dug activities for the first 3 years of the preceding 4 fiscal years (see section 744M(c)(1)(C)(ii)(II) of the FD&C Act). As a result of a geographical revision made by the Bureau of Labor and Statistics in January 2018, the ‘‘Washington, DC-Baltimore’’ index was discontinued and replaced with two separate indices (i.e., the ‘‘WashingtonArlington-Alexandria’’ and ‘‘BaltimoreColumbia-Towson’’ indices). To continue applying a CPI that best reflects the geographic region in which FDA is located and that provides the most current data available, the ‘‘Washington-Arlington-Alexandria’’ index is used in calculating the inflation adjustment percentage. Table 1 summarizes the actual cost and FTE data for the specified fiscal years, provides the percent changes from the previous fiscal years, and provides the average percent changes over the first 3 of the 4 fiscal years preceding FY 2024. The 3-year average is 3.9280 percent. TABLE 1—FDA PC&B EACH YEAR AND PERCENT CHANGES Year 2020 2021 2022 3-Year average Total PC&B ...................................................................................................... Total FTE ......................................................................................................... PC&B per FTE ................................................................................................. Percent Change From Previous Year ............................................................. 2,875,592,000 17,535 163,992 7.3063% 3,039,513,000 18,501 164,289 0.1811% 3,165,477,000 18,474 171,348 4.2967% ........................ ........................ ........................ 3.9280% Under the statute, this 3.9280 percent would be multiplied by the proportion of PC&B costs to the total FDA costs of OTC Monograph drug activities for the first 3 years of the preceding 4 fiscal years (see section 744M(c)(1)(C)(ii) of the FD&C Act). Because OMUFA was first authorized beginning with FY 2021, FDA used cost data of OTC monograph drug activities for the preceding three fiscal years (i.e., FYs 2021–2023) to align with OMUFA’s authorization.7 Table 2 shows the PC&B and the total obligations for OTC monograph drug activities for the last 3 fiscal years. TABLE 2—PC&B AS A PERCENT OF TOTAL COST OF THE PROCESS FOR OTC MONOGRAPH DRUG ACTIVITIES Year 2021 Total PC&B ...................................................................................................... Total Costs ....................................................................................................... PC&B Percent .................................................................................................. The payroll adjustment is 3.9280 percent from table 1 multiplied by 58.1262 percent resulting in 2.2832 percent. 23,133,775 35,030,659 66.0387% Table 3 provides the summary data for the percent changes in the specified CPI for the Washington-ArlingtonAlexandria, DC-VA-MD-WV. The data are published by the Bureau of Labor 2022 2023 25,415,237 49,644,273 51.1947% 39,133,075 68,480,052 57.1452% 3-Year average ........................ ........................ 58.1262% Statistics on its website: https://data. bls.gov/pdq/SurveyOutputServlet?data_ tool=dropmap&series_ id=CUURS35ASA0,CUUSS35ASA0. khammond on DSKJM1Z7X2PROD with NOTICES TABLE 3—ANNUAL AND 3-YEAR AVERAGE PERCENT CHANGE IN CPI FOR WASHINGTON-ARLINGTON-ALEXANDRIA, DC-VAMD-WV AREA Year 2020 Annual CPI ....................................................................................................... 7 We note that in preparing this FY 2024 facility fee rate notice, the Agency had final cost data for FY 2023 OTC monograph drug activities, while in VerDate Sep<11>2014 16:49 Mar 28, 2024 Jkt 262001 267.16 preparing the preceding FY 2024 OMOR fee rate notice (referenced above), the Agency used PO 00000 Frm 00042 Fmt 4703 Sfmt 4703 2021 2022 277.728 296.117 3-Year average ........................ estimated final FY 2023 cost data, as described therein. E:\FR\FM\29MRN1.SGM 29MRN1 22158 Federal Register / Vol. 89, No. 62 / Friday, March 29, 2024 / Notices TABLE 3—ANNUAL AND 3-YEAR AVERAGE PERCENT CHANGE IN CPI FOR WASHINGTON-ARLINGTON-ALEXANDRIA, DC-VAMD-WV AREA—Continued Year 2020 Annual Percent Change .................................................................................. The statute specifies that this 3.8256 percent be multiplied by the proportion of all costs other than PC&B to total costs of OTC monograph drug activities for the first 3 years of the preceding 4 fiscal years (and again, FDA is using cost data of OTC monograph drug activities for the preceding 3 fiscal years, i.e., FYs 2021–2023, to align with OMUFA’s authorization). Because 58.12624 percent was obligated for PC&B (as shown in table 2), 41.8738 percent is the portion of costs other than PC&B (100 percent minus 58.1262 percent equals 41.8738 percent). The non-payroll adjustment is 3.8256 percent times 41.8738 percent, or 1.6019 percent. Next, we add the payroll adjustment (2.2832 percent) to the non-payroll adjustment (1.6019 percent), for a total inflation adjustment of 3.8851 percent for FY 2024. Pursuant to the statute, the FY 2024 base revenue of $21,421,133 is increased by the total inflation adjustment of 3.8851 percent, yielding an inflation adjusted base revenue amount of $22,253,365 for FY 2024 (see section 744M(c)(1)(A)). khammond on DSKJM1Z7X2PROD with NOTICES C. Additional Dollar Amounts For FY 2024, the inflation adjusted revenue amount of $22,253,365 is increased by an additional dollar amount of $7 million as specified in the statute (see section 744M(b)(2)(E) of the FD&C Act). This yields an adjusted fee revenue subtotal of $29,253,365. D. Fee Revenue Adjustment for Additional Direct Cost Fee revenue is further adjusted for additional direct costs as specified in the statute. In FY 2024, $3 million is added to the facility fee revenues to account for additional direct costs (see section 744M(c)(3)(B) of the FD&C Act). Adding the additional direct costs amount of $3 million to $29,253,365 yields an additional direct cost adjusted fee revenue of $32,253,365. E. Fee Revenue Adjustment for Operating Reserve Under OMUFA, FDA may further increase the FY 2024 facility fee revenue and fees if such an adjustment is necessary to provide up to 10 weeks of operating reserves of carryover user fees VerDate Sep<11>2014 16:49 Mar 28, 2024 Jkt 262001 0.8989% for OTC monograph drug activities (see section 744M(c)(2)(B) of the FD&C Act). Accordingly, in setting fees for FY 2024, the Agency must estimate its carryover for FY 2024 to ensure the Agency has sufficient carryover to continue its OTC monograph drug activities, as required under the statute, including an operating reserve to mitigate certain financial risks, such as under collections, unanticipated surges in program costs, or a lapse in appropriations. Under the statute, if FDA has carryover for OTC monograph drug activities that would exceed 10 weeks of such operating reserves, FDA is required to decrease FY 2024 fee revenues and fees to provide for not more than 10 weeks of operating reserves of carryover user fees (see section 744M(c)(2)(C) of the FD&C Act). Per the statute, OMUFA facility fees are not due until the third quarter of each fiscal year (i.e., the first business day in June). To address this timing of facility fee collections for late in the fiscal year, the Agency must set aside additional carryover, beyond that for an operating reserve, to sustain the Agency’s OTC monograph drug activities until the facility fees for the subsequent fiscal year are due and payable on the first business day in June (i.e., June 2, 2025). Thus, the Agency will require FY 2024 carryover sufficient to cover payroll and operating expenses for the first 8 months (i.e., 35 weeks rounded) of the following fiscal year (i.e., October 1, 2024, to May 31, 2025). We refer to the amount of carryover needed to cover this 35-week period as the ‘‘continuity set-aside’’, consistent with the Agency’s use of this term in the annual OMUFA Financial Reports.8 To determine the amount of this continuity set-aside, the Agency starts with the additional direct cost adjusted fee revenue of $32,253,365 (calculated in section D), divides it by 52 to yield a weekly operating amount of $620,257, and then multiplies the weekly operating amount by 35. Based on this calculation, FDA requires $21,708,995 to support the program until the FY 2025 facility fees are due. After running analyses on the projected collections 8 https://www.fda.gov/about-fda/user-feefinancial-reports/omufa-financial-reports. PO 00000 Frm 00043 Fmt 4703 Sfmt 4703 2021 2022 3.9568% 6.6212% 3-Year average 3.8256% and obligations for FY 2024, including accounting for possible financial risks described above, FDA estimates the FY 2024 carryover to be $24,578,371, which is $2,869,361 above the continuity setaside amount needed to support the program through the 35-week period until the FY 2025 facility fees are due. To determine whether the carryover above this continuity set-aside is within the 10-week limit for the operating reserve, FDA multiplies the weekly operating amount ($620,257) by 10, resulting in an operating reserve limit of $6,202,570. Because the estimated FY 2024 carryover above the continuity setaside is below the 10-week threshold, FDA will not increase or reduce the FY 2024 fees or fee revenue under the statutory provision for an operating reserve adjustment. The final FY 2024 OMUFA target facility fee revenue is $32,253,000 (rounded to the nearest thousand dollars). III. Facility Fee Calculations A. Facility Fee Revenues and Fees For FY 2024, facility fee rates are being established to generate a total target revenue amount, as determined under the statute, equal to $32,253,000 (rounded to the nearest thousand dollars). FDA used the methodology described below to determine the appropriate number of MDF and CMO facilities to be used in setting the OMUFA facility fees for FY 2024. FDA took into consideration that the CMO facility fee is equal to two-thirds of the amount of the MDF facility fee (see section 744M(a)(1)(B)(ii) of the FD&C Act). B. Calculating the Number of Qualifying Facilities and Setting the Facility Fees For FY 2024, FDA utilized data consisting of the number of facilities that were registered in FDA’s electronic Drug Registration and Listing System (eDRLS) to manufacture human OTC products produced under a monograph 9 9 See section 744M(d) of the FD&C Act. OTC monograph drug facilities had selected in the eDRLS the business operation qualifiers of ‘‘manufactures human over-the-counter drug products produced under a monograph’’ or ‘‘contract manufacturing for human over-thecounter drug products produced under a monograph’’ and indicated at least one of the following business operations: finished dosage form E:\FR\FM\29MRN1.SGM 29MRN1 Federal Register / Vol. 89, No. 62 / Friday, March 29, 2024 / Notices khammond on DSKJM1Z7X2PROD with NOTICES during the FY 2023 fee-liable period (i.e., January 1, 2022, through December 31, 2022, and that paid FY 2023 OMUFA facility fees, as the primary sources for estimating the number of each facility fee type (i.e., MDF and CMO). In addition, the Agency considered data provided by firms regarding their operation as MDFs and CMOs during FY 2023 (i.e., October 1, 2022, through September 30, 2023) when they were submitting OTC Monograph User Fee Cover Sheets to pay the FY 2023 fee. These data helped FDA estimate the number of firms operating as MDF and CMO facilities during the FY 2024 fee-liable period (i.e., January 1, 2023, through December 31, 2023) 9 10 and thus informed FDA’s calculation of the number and ratio of MDF and CMO facilities used in determining the FY 2024 fee rates. FDA’s review of data also reflected input received during the FY 2024 feeliable period from facilities whose manufacturing or processing practices meet the definition of fee-eligible OTC monograph drug facilities, to help capture those facilities that are in the market and intend to remain in the market for FY 2024. Those facilities that only manufacture the active pharmaceutical ingredient of an OTC monograph drug do not meet the definition of an OTC monograph drug facility (see section 744L(10)(A)(i)(II)) of the FD&C Act). Likewise, a facility is not an OTC monograph drug facility if its only manufacturing or processing activities are one or more of the following: (1) production of clinical research supplies; (2) testing; or (3) placement of outer packaging on packages containing multiple products, for such purposes as creating multipacks, when each manufacture, label, manufacture, pack, relabel, or repack. 10 FDA considers relabelers and repackagers to be a category of OTC monograph drug facilities subject to OMUFA facility fees. See section 744L(10)(A); see also section 744L(10)(A)(iii) of the FD&C Act, excluding from the definition of ‘‘OTC monograph drug facility’’ those facilities whose manufacturing or processing consists solely of a narrow range of specified activities (e.g., placement of outer overpackaging on products already in final packaged form); cf section 744A(6)(A)(ii) of the FD&C Act (which expressly excludes from the definition of ‘‘facility’’, for purposes of Generic Drug User Fee Amendments facility fees, a business or other entity whose only manufacturing or processing activities are repackaging, relabeling, or testing). See also 21 CFR 207.1 (addressing drug establishment registration), stating that ‘‘[m]anufacture means each step in the manufacture, preparation, propagation, compounding, or processing of a drug,’’ and indicating that ‘‘the term ‘manufacture, preparation, propagation, compounding, or processing,’ as used in section 510 of the Federal Food, Drug, and Cosmetic Act, includes relabeling, repackaging, and salvaging activities.’’ VerDate Sep<11>2014 16:49 Mar 28, 2024 Jkt 262001 monograph drug product contained within the overpackaging is already in a final packaged form prior to placement in the outer overpackaging (see section 744L(10)(A)(iii) of the FD&C Act). Consistent with the January 12, 2021 HHS Federal Register notice 11 (HHS FRN) and FDA’s subsequent Federal Register notices published on March 26, 2021, March 16, 2022, and March 27, 2023, announcing the FY 2021, FY 2022, and FY 2023 OMUFA fees (respectively),12 13 14 facilities are not identified as an ‘‘OTC monograph drug facility’’ and will not be assessed a FY 2024 OMUFA facility fee if they: (1) were not registered with FDA as OTC drug manufacturers prior to the HHS declaration of the COVID–19 public health emergency (PHE) on January 27, 2020; 15 (2) registered with FDA on or after the declaration of the COVID–19 PHE; and (3) registered for the sole purpose of producing hand sanitizer products during the COVID–19 PHE. We note, however, that under the FD&C Act, whether an entity is subject to OMUFA fees has no bearing on whether the entity or the entity’s products are subject to other requirements under the FD&C Act. FDA will continue to use its regulatory compliance and enforcement tools to protect consumers, including from hand sanitizers or other drugs that are potentially dangerous or subpotent. Although this notice addresses FY 2024 OMUFA facility fees, the Agency is highlighting the following information for interested parties in the interest of transparency regarding the Agency’s planning for assessment of OMUFA facility fees for FY 2025: the January 12, 2021 HHS FRN explains that ‘‘[t]he Department’s conclusion [that certain hand sanitizer manufacturers are not identified as OTC monograph drug facilities] does not apply to such persons which (1) manufacture, distribute, and sell over-the-counter drugs in addition to hand sanitizer or (2) continue to manufacture (as opposed to hold, distribute, or sell existing 11 See 86 FR 2420, https://www.federal register.gov/documents/2021/01/12/2021-00237/ notice-that-persons-that-entered-the-over-thecounter-drug-market-to-supply-hand-sanitizerduring. 12 See 86 FR 16223, https://www.federal register.gov/documents/2021/03/26/2021-06361/ fee-rates-under-the-over-the-counter-monographdrug-user-fee-program-for-fiscal-year-2021. 13 See 87 FR 14888, https://www.federal register.gov/documents/2022/03/16/2022-05542/ over-the-counter-monograph-drug-user-fee-ratesfor-fiscal-year-2022. 14 See 88 FR 18156, https://www.federal register.gov/documents/2023/03/27/2023-06299/ over-the-counter-monograph-drug-user-fee-ratesfor-fiscal-year-2023. 15 See https://www.phe.gov/emergency/news/ healthactions/phe/Pages/2019-nCoV.aspx. PO 00000 Frm 00044 Fmt 4703 Sfmt 4703 22159 inventories) hand sanitizer products as of December 31 of the year immediately following the year during which the COVID–19 Public Health Emergency is terminated. In those cases, the Department may identify such persons as OTC drug manufacturing facilities’’ 16 (emphasis added). Accordingly, as the PHE expired on May 11, 2023, those facilities which ‘‘continue to manufacture’’ solely hand sanitizer products as of December 31, 2024, will be identified as OTC monograph drug facilities and be subject to an OMUFA facility fee for FY 2025. Conversely, if such facilities cease manufacturing hand sanitizer products and delist and deregister to reflect that before 12 a.m. EST on December 31, 2024, they will not be identified as an OTC monograph drug facility 17 and will not be considered fee liable for purposes of FY 2025 OMUFA facility fees.18 In other words if facilities described in the January 12, 2021 HHS FRN, i.e., those that first registered with FDA on or after the declaration of the COVID–19 PHE for the sole purpose of producing hand sanitizer products during the COVID–19 PHE, seek to avoid being identified as OTC monograph drug facilities subject to OMUFA facility fees for FY 2025 and beyond, they will need to cease production of hand sanitizer products and update their registration and listing accordingly, before 12 a.m. on December 31, 2024. In undertaking the statutorily directed fee calculations for FY 2024 fees, the Agency also made certain assumptions, including that: (1) facilities using expired Structured Product Labeling codes in eDRLS, that have not reregistered, were no longer manufacturing and marketing OTC monograph drugs; (2) facilities that have deregistered in eDRLS have exited the market; (3) facilities that FDA believes registered incorrectly as OTC monograph drug facilities (for example, because the associated drug listings for these facilities did not include OTC monograph drugs but instead indicated such products as OTC drug products under an approved drug application or OTC animal drug products) were not engaged in manufacturing or processing the finished dosage form of an OTC monograph drug; (4) facilities that registered but did not have an active OTC monograph drug product listing associated in their registration profile 16 See https://www.federalregister.gov/ documents/2021/01/12/2021-00237/notice-thatpersons-that-entered-the-over-the-counter-drugmarket-to-supply-hand-sanitizer-during. 17 Id. 18 Id. E:\FR\FM\29MRN1.SGM 29MRN1 22160 Federal Register / Vol. 89, No. 62 / Friday, March 29, 2024 / Notices payments can be submitted using the User Fees Payment Portal at https:// userfees.fda.gov/pay. (Note: Only full payments are accepted through https:// userfees.fda.gov/pay. No partial payments can be made online). Once an invoice is located, ‘‘Pay Now’’ should be selected to be redirected to Pay.gov. Electronic payment options are based on the balance due. Payment by credit card is available for balances that are less than $25,000. If the balance exceeds this amount, only the ACH option is available. Payments must be made using U.S. bank accounts as well as U.S. credit cards. For payments made by wire transfer, include the unique user fee ID number to ensure that the payment is applied to the correct fee(s). Without the unique user fee ID number, the payment may not be applied, which could result in consequences of nonpayment per section 744M(e)(1) of the FD&C Act. The originating financial institution may charge a wire transfer fee. Applicable V. Fee Schedule for FY 2024 wire transfer fees must be included with The fee rates for FY 2024 are payment to ensure fees are fully paid. displayed in table 4. Questions about wire transfer fees should be addressed to the financial TABLE 4—FEE SCHEDULE FOR FY institution. The account information for 2024 wire transfers is as follows: U.S. Department of the Treasury, TREAS FY 2024 NYC, 33 Liberty St., New York, NY Fee category Fee rates 10045, Acct. No.: 75060099, Routing No.: 021030004, SWIFT: FRNYUS33. If Facility Fees: MDF ........................................ $34,166 needed, FDA’s tax identification CMO ........................................ 22,777 number is 53–0196965. If you are assessed an FY 2024 OMUFA facility fee and believe your VI. Fee Payment Options and facility is not an OTC monograph drug Procedures facility as described in this notice, The new facility fee rates are for the please contact CDERCollections@ period from October 1, 2023, through fda.hhs.gov. September 30, 2024. To pay the MDF Dated: March 26, 2024. and CMO fees, complete an OTC Monograph User Fee Cover Sheet, Lauren K. Roth, available at: https://userfees.fda.gov/ Associate Commissioner for Policy. OA_HTML/omufaCAcdLogin.jsp. [FR Doc. 2024–06723 Filed 3–28–24; 8:45 am] A user fee identification (ID) number BILLING CODE 4164–01–P will be generated. Payment must be made in U.S. currency by electronic check or wire transfer, payable to the DEPARTMENT OF HEALTH AND order of the Food and Drug HUMAN SERVICES Administration. The preferred payment method is online using electronic check Food and Drug Administration (Automated Clearing House (ACH) also [Docket No. FDA–2024–D–1242] known as eCheck) or credit card for payments under $25,000 (Discover, Animal Studies for Dental Bone VISA, MasterCard, American Express). Grafting Material Devices—Premarket FDA has partnered with the U.S. Notification (510(k)) Submissions; Department of the Treasury to use Draft Guidance for Industry and Food Pay.gov, a web-based payment and Drug Administration Staff; application, for online electronic Availability payment. The Pay.gov feature is available on the FDA website after AGENCY: Food and Drug Administration, completing the OTC Monograph User HHS. Fee Cover Sheet and generating the user ACTION: Notice of availability. fee ID number. Secure electronic khammond on DSKJM1Z7X2PROD with NOTICES were not manufacturing or processing such drug products; and (5) facilities that, at the close of FY 2023, remain on the arrears list for failure to satisfy the FY 2021, FY 2022, or FY 2023 facility fee are likely to be placed on the FY 2024 arrears list as well. Based on the above-referenced factors and assumptions, FDA estimates there will be 1,102 OMUFA fee-paying units. The Agency estimates that 57 percent (1,102 × 0.57 = 628, rounded) will incur the MDF fee and 43 percent (1,102 × 0.43 = 474, rounded) will incur the CMO fee. To determine the number of full feepaying equivalents (the denominator) to be used in setting the OMUFA fees, FDA assigns a value of 1 to each MDF (628) and a value of 2⁄3 to each CMO (474 × 2⁄3 = 316) for a full facility equivalent of 944 (rounded). The target fee revenue of $32,253,000 is then divided by 944 for an MDF fee of $34,166 and a CMO fee of $22,777. VerDate Sep<11>2014 16:49 Mar 28, 2024 Jkt 262001 PO 00000 Frm 00045 Fmt 4703 Sfmt 4703 The Food and Drug Administration (FDA or Agency) is announcing the availability of the draft guidance entitled ‘‘Animal Studies for Dental Bone Grafting Material Devices— Premarket Notification (510(k)) Submissions.’’ This draft guidance document provides animal study design recommendations and animal study information to include to support a 510(k) submission for dental bone grafting material devices. This draft guidance may help manufacturers comply with some special controls for dental bone grafting material devices. The recommendations reflect current review practices and are intended to promote consistency and facilitate efficient review of these submissions. This draft guidance is not final nor is it for implementation at this time. DATES: Submit either electronic or written comments on the draft guidance by May 28, 2024 to ensure that the Agency considers your comment on this draft guidance before it begins work on the final version of the guidance. ADDRESSES: You may submit comments on any guidance at any time as follows: SUMMARY: Electronic Submissions Submit electronic comments in the following way: • Federal eRulemaking Portal: https://www.regulations.gov. Follow the instructions for submitting comments. Comments submitted electronically, including attachments, to https:// www.regulations.gov will be posted to the docket unchanged. Because your comment will be made public, you are solely responsible for ensuring that your comment does not include any confidential information that you or a third party may not wish to be posted, such as medical information, your or anyone else’s Social Security number, or confidential business information, such as a manufacturing process. Please note that if you include your name, contact information, or other information that identifies you in the body of your comments, that information will be posted on https://www.regulations.gov. • If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see ‘‘Written/Paper Submissions’’ and ‘‘Instructions’’). Written/Paper Submissions Submit written/paper submissions as follows: • Mail/Hand delivery/Courier (for written/paper submissions): Dockets Management Staff (HFA–305), Food and E:\FR\FM\29MRN1.SGM 29MRN1

Agencies

[Federal Register Volume 89, Number 62 (Friday, March 29, 2024)]
[Notices]
[Pages 22156-22160]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-06723]


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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2024-N-1298]


Over-the-Counter Monograph Drug User Fee Program--Facility Fee 
Rates for Fiscal Year 2024

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA or the Agency) is 
announcing the over-the-counter (OTC) monograph drug facility (MDF) fee 
rates under the OTC monograph drug user fee program (OMUFA) for fiscal 
year (FY) 2024. The Federal Food, Drug, and Cosmetic Act (FD&C Act) 
authorizes FDA to assess and collect user fees from qualifying 
manufacturers of OTC monograph drugs and submitters of OTC monograph 
order requests (OMORs). This notice publishes the OMUFA facility fee 
rates for FY 2024.

DATES: These facility fees are effective on October 1, 2023, and will 
remain in effect through September 30, 2024.

FOR FURTHER INFORMATION CONTACT: Olufunmilayo (Funmi) Ariyo, Office of 
Financial Management, Food and Drug Administration, 4041 Powder Mill 
Rd., 6th Floor, Beltsville, MD 20705-4304, 240-402-4989; or the User 
Fees Support Staff at [email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    Section 744M of the FD&C Act (21 U.S.C. 379j-72), authorizes FDA to 
assess and collect: (1) facility fees from qualifying owners of OTC 
monograph drug facilities and (2) fees from submitters of qualifying 
OTC OMORs. The OTC OMOR fee rates for FY 2024 were published on 
September 12, 2023.\1\ These fees are to support FDA's OTC monograph 
drug activities, which are detailed in section 744L(6) of the FD&C Act 
(21 U.S.C. 379j-71(6)) and include various FDA activities associated 
with OTC monograph drugs. For OMUFA purposes:
---------------------------------------------------------------------------

    \1\ https://www.federalregister.gov/documents/2023/09/12/2023-19609/over-the-counter-monograph-drug-user-fee-program-otc-monograph-order-requests-fee-rates-for-fiscal.
---------------------------------------------------------------------------

     An OTC monograph drug is a nonprescription drug without an 
approved new drug application that is governed by the provisions of 
section 505G of the FD&C Act (21 U.S.C. 355h) (see section 744L(5) of 
the FD&C Act);
     An OTC MDF is a foreign or domestic business or other 
entity that, in addition to meeting other criteria, is engaged in 
manufacturing or processing the finished dosage form of an OTC 
monograph drug (see section 744L(10) of the FD&C Act); and
     A contract manufacturing organization (CMO) facility is an 
OTC monograph drug facility where neither the owner nor any affiliate 
of the owner or facility sells the OTC monograph drug produced at such 
facility directly to wholesalers, retailers, or consumers in the United 
States (see section 744L(2) of the FD&C Act).
    Under section 744M(a)(1)(A) of the FD&C Act, a facility fee for FY 
2024 shall be assessed with respect to each facility that is identified 
as an OTC monograph drug facility during the fee-liable period from 
January 1, 2023, through December 31, 2023.\2\ Consistent with the 
statute, FDA will assess and collect facility fees with respect to the 
two types of OTC monograph drug facilities--MDF and CMO facilities. A 
full facility fee will be assessed to each qualifying person that owns 
a facility identified as an MDF (see section 744M(a)(1)(A) of the FD&C 
Act), and a reduced facility fee of two-thirds will be assessed to each 
qualifying person that owns a facility identified as a CMO facility 
(see section 744M(a)(1)(B)(ii) of the FD&C Act). The facility fees for 
FY 2024 are due on June 3, 2024 (see section 744M(a)(1)(D)(ii) of the 
FD&C Act).\3\
---------------------------------------------------------------------------

    \2\ Under section 744M(a)(1) of the FD&C Act, ``Each person that 
owns a facility identified as an OTC monograph drug facility on 
December 31 of the fiscal year or at any time during the preceding 
12-month period shall be assessed an annual fee for each such 
facility.'' For purposes of FY 2024 facility fees, that time period 
is January 1, 2023, through December 31, 2023.
    \3\ Assuming that, as we anticipate, the FY 2024 fee 
appropriation will occur prior to June 3, 2024. Under section 
744M(a)(1)(D)(ii), the FY 2024 facility fees are due on the later 
of: (1) the first business day of June 2024 (i.e., June 3, 2024) or 
(2) the first business day after the enactment of an appropriations 
Act providing for the collection and obligation of FY 2024 OMUFA 
fees.
---------------------------------------------------------------------------

    As discussed in greater detail below:
     OTC monograph drug facilities are exempt from FY 2024 
facility fees if they had ceased OTC monograph drug activities, and 
updated their registration with FDA to that effect, prior to December 
31, 2022 (see section 744M(a)(1)(B)(i) of the FD&C Act).
     Entities that registered with FDA during the Coronavirus 
Disease 2019 (COVID-19) pandemic whose sole activity with respect to 
OTC monograph drugs during the pandemic consists (or had consisted) of 
manufacturing OTC hand sanitizer products \4\ are not identified as OTC 
monograph drug facilities subject to OMUFA facility fees for FY 
2024.\5\
---------------------------------------------------------------------------

    \4\ The term ``hand sanitizer'' commonly refers to consumer 
antiseptic rubs. However, because the Department of Health and Human 
Services (HHS) notice published January 12, 2021, referred to 
``persons that entered the over-the-counter drug market to supply 
hand sanitizer products in response to the COVID-19 Public Health 
Emergency'' (86 FR 2420 https://www.federalregister.gov/documents/2021/01/12/2021-00237/notice-that-persons-that-entered-the-over-the-counter-drug-market-to-supply-hand-sanitizer-during), we are using 
the same terminology--``hand sanitizer products''--to refer to OTC 
monograph drug products intended for use (without water) as 
antiseptic hand rubs or antiseptic hand wipes by consumers or 
healthcare personnel.
    \5\ See HHS Federal Register notice of January 12, 2021, 86 FR 
2420, https://www.federalregister.gov/documents/2021/01/12/2021-00237/notice-that-persons-that-entered-the-over-the-counter-drug-market-to-supply-hand-sanitizer-during.
---------------------------------------------------------------------------

    For FY 2024, the OMUFA facility fee rates are: MDF facility fees 
($34,166) and CMO facility fees ($22,777). These fees are effective for 
the period from October 1, 2023, through September 30, 2024.\6\ This 
document is issued pursuant to section 744M(a)(4) and 744M(c)(4)(B) of 
the FD&C Act and describes the calculations used to set the OMUFA 
facility fees for FY 2024 in accordance with the directives in the 
statute.
---------------------------------------------------------------------------

    \6\ These OMUFA fees are for FY 2024, per section 744M(a) of the 
FD&C Act.
---------------------------------------------------------------------------

II. Facility Fee Revenue Amount for FY 2024

A. Base Fee Revenue Amount

    Under OMUFA, FDA sets annual facility fees to generate the total 
facility fee revenues for each fiscal year

[[Page 22157]]

established by section 744M(b) of the FD&C Act. The yearly base revenue 
amount is the starting point for setting annual facility fee rates. The 
base revenue for FY 2024 is the dollar amount of the total revenue 
amount for the previous fiscal year, without certain adjustments made 
for that previous year, and is $21,421,133 (see section 744M(b)(3)(B) 
of the FD&C Act).

B. Fee Revenue Adjustment for Inflation

    Under OMUFA, the annual base revenue amount for facility fees is 
adjusted for inflation for FY 2024 and each subsequent fiscal year (see 
section 744M(c)(1) of the FD&C Act). That provision states that the 
dollar amount of the inflation adjustment is equal to the product of 
the annual base revenue for the fiscal year and the inflation 
adjustment percentage. For FY 2024 the inflation adjustment percentage 
is the sum of:
     (I) the average annual percent change in cost, per full-
time equivalent (FTE) position of FDA, of all personnel compensation 
and benefits paid with respect to such positions for the first 3 years 
of the preceding 4 fiscal years, multiplied by the proportion of 
personnel compensation and benefits (PC&B) costs to total costs of the 
OTC monograph drug activities for the first 3 years of the preceding 4 
fiscal years (see section 744M(c)(1)(C)(ii)(I) of the FD&C Act); and
     (II) the average annual percent change that occurred in 
the Consumer Price Index (CPI) for urban consumers (Washington-
Baltimore, DC-MD-VA-WV; Not Seasonally Adjusted; All items; Annual 
Index) for the first 3 years of the preceding 4 years of available data 
multiplied by the proportion of all costs other than personnel 
compensation and benefits costs to total costs of OTC monograph dug 
activities for the first 3 years of the preceding 4 fiscal years (see 
section 744M(c)(1)(C)(ii)(II) of the FD&C Act).
    As a result of a geographical revision made by the Bureau of Labor 
and Statistics in January 2018, the ``Washington, DC-Baltimore'' index 
was discontinued and replaced with two separate indices (i.e., the 
``Washington-Arlington-Alexandria'' and ``Baltimore-Columbia-Towson'' 
indices). To continue applying a CPI that best reflects the geographic 
region in which FDA is located and that provides the most current data 
available, the ``Washington-Arlington-Alexandria'' index is used in 
calculating the inflation adjustment percentage.
    Table 1 summarizes the actual cost and FTE data for the specified 
fiscal years, provides the percent changes from the previous fiscal 
years, and provides the average percent changes over the first 3 of the 
4 fiscal years preceding FY 2024. The 3-year average is 3.9280 percent.

                                 Table 1--FDA PC&B Each Year and Percent Changes
----------------------------------------------------------------------------------------------------------------
                                                                                                      3-Year
                      Year                             2020            2021            2022           average
----------------------------------------------------------------------------------------------------------------
Total PC&B......................................   2,875,592,000   3,039,513,000   3,165,477,000  ..............
Total FTE.......................................          17,535          18,501          18,474  ..............
PC&B per FTE....................................         163,992         164,289         171,348  ..............
Percent Change From Previous Year...............         7.3063%         0.1811%         4.2967%         3.9280%
----------------------------------------------------------------------------------------------------------------

    Under the statute, this 3.9280 percent would be multiplied by the 
proportion of PC&B costs to the total FDA costs of OTC Monograph drug 
activities for the first 3 years of the preceding 4 fiscal years (see 
section 744M(c)(1)(C)(ii) of the FD&C Act). Because OMUFA was first 
authorized beginning with FY 2021, FDA used cost data of OTC monograph 
drug activities for the preceding three fiscal years (i.e., FYs 2021-
2023) to align with OMUFA's authorization.\7\
---------------------------------------------------------------------------

    \7\ We note that in preparing this FY 2024 facility fee rate 
notice, the Agency had final cost data for FY 2023 OTC monograph 
drug activities, while in preparing the preceding FY 2024 OMOR fee 
rate notice (referenced above), the Agency used estimated final FY 
2023 cost data, as described therein.
---------------------------------------------------------------------------

    Table 2 shows the PC&B and the total obligations for OTC monograph 
drug activities for the last 3 fiscal years.

            Table 2--PC&B as a Percent of Total Cost of the Process for OTC Monograph Drug Activities
----------------------------------------------------------------------------------------------------------------
                                                                                                      3-Year
                      Year                             2021            2022            2023           average
----------------------------------------------------------------------------------------------------------------
Total PC&B......................................      23,133,775      25,415,237      39,133,075  ..............
Total Costs.....................................      35,030,659      49,644,273      68,480,052  ..............
PC&B Percent....................................        66.0387%        51.1947%        57.1452%        58.1262%
----------------------------------------------------------------------------------------------------------------

    The payroll adjustment is 3.9280 percent from table 1 multiplied by 
58.1262 percent resulting in 2.2832 percent.
    Table 3 provides the summary data for the percent changes in the 
specified CPI for the Washington-Arlington-Alexandria, DC-VA-MD-WV. The 
data are published by the Bureau of Labor Statistics on its website: 
https://data.bls.gov/pdq/SurveyOutputServlet?data_tool=dropmap&series_id=CUURS35ASA0,CUUSS35ASA0.


 Table 3--Annual and 3-Year Average Percent Change in CPI for Washington-Arlington-Alexandria, DC-VA-MD-WV Area
----------------------------------------------------------------------------------------------------------------
                                                                                                      3-Year
                      Year                             2020            2021            2022           average
----------------------------------------------------------------------------------------------------------------
Annual CPI......................................          267.16         277.728         296.117  ..............

[[Page 22158]]

 
Annual Percent Change...........................         0.8989%         3.9568%         6.6212%         3.8256%
----------------------------------------------------------------------------------------------------------------

    The statute specifies that this 3.8256 percent be multiplied by the 
proportion of all costs other than PC&B to total costs of OTC monograph 
drug activities for the first 3 years of the preceding 4 fiscal years 
(and again, FDA is using cost data of OTC monograph drug activities for 
the preceding 3 fiscal years, i.e., FYs 2021-2023, to align with 
OMUFA's authorization). Because 58.12624 percent was obligated for PC&B 
(as shown in table 2), 41.8738 percent is the portion of costs other 
than PC&B (100 percent minus 58.1262 percent equals 41.8738 percent). 
The non-payroll adjustment is 3.8256 percent times 41.8738 percent, or 
1.6019 percent.
    Next, we add the payroll adjustment (2.2832 percent) to the non-
payroll adjustment (1.6019 percent), for a total inflation adjustment 
of 3.8851 percent for FY 2024.
    Pursuant to the statute, the FY 2024 base revenue of $21,421,133 is 
increased by the total inflation adjustment of 3.8851 percent, yielding 
an inflation adjusted base revenue amount of $22,253,365 for FY 2024 
(see section 744M(c)(1)(A)).

C. Additional Dollar Amounts

    For FY 2024, the inflation adjusted revenue amount of $22,253,365 
is increased by an additional dollar amount of $7 million as specified 
in the statute (see section 744M(b)(2)(E) of the FD&C Act). This yields 
an adjusted fee revenue subtotal of $29,253,365.

D. Fee Revenue Adjustment for Additional Direct Cost

    Fee revenue is further adjusted for additional direct costs as 
specified in the statute. In FY 2024, $3 million is added to the 
facility fee revenues to account for additional direct costs (see 
section 744M(c)(3)(B) of the FD&C Act). Adding the additional direct 
costs amount of $3 million to $29,253,365 yields an additional direct 
cost adjusted fee revenue of $32,253,365.

E. Fee Revenue Adjustment for Operating Reserve

    Under OMUFA, FDA may further increase the FY 2024 facility fee 
revenue and fees if such an adjustment is necessary to provide up to 10 
weeks of operating reserves of carryover user fees for OTC monograph 
drug activities (see section 744M(c)(2)(B) of the FD&C Act). 
Accordingly, in setting fees for FY 2024, the Agency must estimate its 
carryover for FY 2024 to ensure the Agency has sufficient carryover to 
continue its OTC monograph drug activities, as required under the 
statute, including an operating reserve to mitigate certain financial 
risks, such as under collections, unanticipated surges in program 
costs, or a lapse in appropriations. Under the statute, if FDA has 
carryover for OTC monograph drug activities that would exceed 10 weeks 
of such operating reserves, FDA is required to decrease FY 2024 fee 
revenues and fees to provide for not more than 10 weeks of operating 
reserves of carryover user fees (see section 744M(c)(2)(C) of the FD&C 
Act).
    Per the statute, OMUFA facility fees are not due until the third 
quarter of each fiscal year (i.e., the first business day in June). To 
address this timing of facility fee collections for late in the fiscal 
year, the Agency must set aside additional carryover, beyond that for 
an operating reserve, to sustain the Agency's OTC monograph drug 
activities until the facility fees for the subsequent fiscal year are 
due and payable on the first business day in June (i.e., June 2, 2025). 
Thus, the Agency will require FY 2024 carryover sufficient to cover 
payroll and operating expenses for the first 8 months (i.e., 35 weeks 
rounded) of the following fiscal year (i.e., October 1, 2024, to May 
31, 2025). We refer to the amount of carryover needed to cover this 35-
week period as the ``continuity set-aside'', consistent with the 
Agency's use of this term in the annual OMUFA Financial Reports.\8\
---------------------------------------------------------------------------

    \8\ https://www.fda.gov/about-fda/user-fee-financial-reports/omufa-financial-reports.
---------------------------------------------------------------------------

    To determine the amount of this continuity set-aside, the Agency 
starts with the additional direct cost adjusted fee revenue of 
$32,253,365 (calculated in section D), divides it by 52 to yield a 
weekly operating amount of $620,257, and then multiplies the weekly 
operating amount by 35. Based on this calculation, FDA requires 
$21,708,995 to support the program until the FY 2025 facility fees are 
due. After running analyses on the projected collections and 
obligations for FY 2024, including accounting for possible financial 
risks described above, FDA estimates the FY 2024 carryover to be 
$24,578,371, which is $2,869,361 above the continuity set-aside amount 
needed to support the program through the 35-week period until the FY 
2025 facility fees are due.
    To determine whether the carryover above this continuity set-aside 
is within the 10-week limit for the operating reserve, FDA multiplies 
the weekly operating amount ($620,257) by 10, resulting in an operating 
reserve limit of $6,202,570. Because the estimated FY 2024 carryover 
above the continuity set-aside is below the 10-week threshold, FDA will 
not increase or reduce the FY 2024 fees or fee revenue under the 
statutory provision for an operating reserve adjustment. The final FY 
2024 OMUFA target facility fee revenue is $32,253,000 (rounded to the 
nearest thousand dollars).

III. Facility Fee Calculations

A. Facility Fee Revenues and Fees

    For FY 2024, facility fee rates are being established to generate a 
total target revenue amount, as determined under the statute, equal to 
$32,253,000 (rounded to the nearest thousand dollars). FDA used the 
methodology described below to determine the appropriate number of MDF 
and CMO facilities to be used in setting the OMUFA facility fees for FY 
2024. FDA took into consideration that the CMO facility fee is equal to 
two-thirds of the amount of the MDF facility fee (see section 
744M(a)(1)(B)(ii) of the FD&C Act).

B. Calculating the Number of Qualifying Facilities and Setting the 
Facility Fees

    For FY 2024, FDA utilized data consisting of the number of 
facilities that were registered in FDA's electronic Drug Registration 
and Listing System (eDRLS) to manufacture human OTC products produced 
under a monograph \9\

[[Page 22159]]

during the FY 2023 fee-liable period (i.e., January 1, 2022, through 
December 31, 2022, and that paid FY 2023 OMUFA facility fees, as the 
primary sources for estimating the number of each facility fee type 
(i.e., MDF and CMO). In addition, the Agency considered data provided 
by firms regarding their operation as MDFs and CMOs during FY 2023 
(i.e., October 1, 2022, through September 30, 2023) when they were 
submitting OTC Monograph User Fee Cover Sheets to pay the FY 2023 fee. 
These data helped FDA estimate the number of firms operating as MDF and 
CMO facilities during the FY 2024 fee-liable period (i.e., January 1, 
2023, through December 31, 2023) ^{9 10} and thus informed 
FDA's calculation of the number and ratio of MDF and CMO facilities 
used in determining the FY 2024 fee rates. FDA's review of data also 
reflected input received during the FY 2024 fee-liable period from 
facilities whose manufacturing or processing practices meet the 
definition of fee-eligible OTC monograph drug facilities, to help 
capture those facilities that are in the market and intend to remain in 
the market for FY 2024.
---------------------------------------------------------------------------

    \9\ See section 744M(d) of the FD&C Act. OTC monograph drug 
facilities had selected in the eDRLS the business operation 
qualifiers of ``manufactures human over-the-counter drug products 
produced under a monograph'' or ``contract manufacturing for human 
over-the-counter drug products produced under a monograph'' and 
indicated at least one of the following business operations: 
finished dosage form manufacture, label, manufacture, pack, relabel, 
or repack.
    \10\ FDA considers relabelers and repackagers to be a category 
of OTC monograph drug facilities subject to OMUFA facility fees. See 
section 744L(10)(A); see also section 744L(10)(A)(iii) of the FD&C 
Act, excluding from the definition of ``OTC monograph drug 
facility'' those facilities whose manufacturing or processing 
consists solely of a narrow range of specified activities (e.g., 
placement of outer overpackaging on products already in final 
packaged form); cf section 744A(6)(A)(ii) of the FD&C Act (which 
expressly excludes from the definition of ``facility'', for purposes 
of Generic Drug User Fee Amendments facility fees, a business or 
other entity whose only manufacturing or processing activities are 
repackaging, relabeling, or testing). See also 21 CFR 207.1 
(addressing drug establishment registration), stating that 
``[m]anufacture means each step in the manufacture, preparation, 
propagation, compounding, or processing of a drug,'' and indicating 
that ``the term `manufacture, preparation, propagation, compounding, 
or processing,' as used in section 510 of the Federal Food, Drug, 
and Cosmetic Act, includes relabeling, repackaging, and salvaging 
activities.''
---------------------------------------------------------------------------

    Those facilities that only manufacture the active pharmaceutical 
ingredient of an OTC monograph drug do not meet the definition of an 
OTC monograph drug facility (see section 744L(10)(A)(i)(II)) of the 
FD&C Act). Likewise, a facility is not an OTC monograph drug facility 
if its only manufacturing or processing activities are one or more of 
the following: (1) production of clinical research supplies; (2) 
testing; or (3) placement of outer packaging on packages containing 
multiple products, for such purposes as creating multipacks, when each 
monograph drug product contained within the overpackaging is already in 
a final packaged form prior to placement in the outer overpackaging 
(see section 744L(10)(A)(iii) of the FD&C Act).
    Consistent with the January 12, 2021 HHS Federal Register notice 
\11\ (HHS FRN) and FDA's subsequent Federal Register notices published 
on March 26, 2021, March 16, 2022, and March 27, 2023, announcing the 
FY 2021, FY 2022, and FY 2023 OMUFA fees 
(respectively),^{12 13 14} facilities are not identified as an 
``OTC monograph drug facility'' and will not be assessed a FY 2024 
OMUFA facility fee if they: (1) were not registered with FDA as OTC 
drug manufacturers prior to the HHS declaration of the COVID-19 public 
health emergency (PHE) on January 27, 2020; \15\ (2) registered with 
FDA on or after the declaration of the COVID-19 PHE; and (3) registered 
for the sole purpose of producing hand sanitizer products during the 
COVID-19 PHE. We note, however, that under the FD&C Act, whether an 
entity is subject to OMUFA fees has no bearing on whether the entity or 
the entity's products are subject to other requirements under the FD&C 
Act. FDA will continue to use its regulatory compliance and enforcement 
tools to protect consumers, including from hand sanitizers or other 
drugs that are potentially dangerous or subpotent.
---------------------------------------------------------------------------

    \11\ See 86 FR 2420, https://www.federalregister.gov/documents/2021/01/12/2021-00237/notice-that-persons-that-entered-the-over-the-counter-drug-market-to-supply-hand-sanitizer-during.
    \12\ See 86 FR 16223, https://www.federalregister.gov/documents/2021/03/26/2021-06361/fee-rates-under-the-over-the-counter-monograph-drug-user-fee-program-for-fiscal-year-2021.
    \13\ See 87 FR 14888, https://www.federalregister.gov/documents/2022/03/16/2022-05542/over-the-counter-monograph-drug-user-fee-rates-for-fiscal-year-2022.
    \14\ See 88 FR 18156, https://www.federalregister.gov/documents/2023/03/27/2023-06299/over-the-counter-monograph-drug-user-fee-rates-for-fiscal-year-2023.
    \15\ See https://www.phe.gov/emergency/news/healthactions/phe/Pages/2019-nCoV.aspx.
---------------------------------------------------------------------------

    Although this notice addresses FY 2024 OMUFA facility fees, the 
Agency is highlighting the following information for interested parties 
in the interest of transparency regarding the Agency's planning for 
assessment of OMUFA facility fees for FY 2025: the January 12, 2021 HHS 
FRN explains that ``[t]he Department's conclusion [that certain hand 
sanitizer manufacturers are not identified as OTC monograph drug 
facilities] does not apply to such persons which (1) manufacture, 
distribute, and sell over-the-counter drugs in addition to hand 
sanitizer or (2) continue to manufacture (as opposed to hold, 
distribute, or sell existing inventories) hand sanitizer products as of 
December 31 of the year immediately following the year during which the 
COVID-19 Public Health Emergency is terminated. In those cases, the 
Department may identify such persons as OTC drug manufacturing 
facilities'' \16\ (emphasis added). Accordingly, as the PHE expired on 
May 11, 2023, those facilities which ``continue to manufacture'' solely 
hand sanitizer products as of December 31, 2024, will be identified as 
OTC monograph drug facilities and be subject to an OMUFA facility fee 
for FY 2025. Conversely, if such facilities cease manufacturing hand 
sanitizer products and delist and deregister to reflect that before 12 
a.m. EST on December 31, 2024, they will not be identified as an OTC 
monograph drug facility \17\ and will not be considered fee liable for 
purposes of FY 2025 OMUFA facility fees.\18\ In other words if 
facilities described in the January 12, 2021 HHS FRN, i.e., those that 
first registered with FDA on or after the declaration of the COVID-19 
PHE for the sole purpose of producing hand sanitizer products during 
the COVID-19 PHE, seek to avoid being identified as OTC monograph drug 
facilities subject to OMUFA facility fees for FY 2025 and beyond, they 
will need to cease production of hand sanitizer products and update 
their registration and listing accordingly, before 12 a.m. on December 
31, 2024.
---------------------------------------------------------------------------

    \16\ See https://www.federalregister.gov/documents/2021/01/12/2021-00237/notice-that-persons-that-entered-the-over-the-counter-drug-market-to-supply-hand-sanitizer-during.
    \17\ Id.
    \18\ Id.
---------------------------------------------------------------------------

    In undertaking the statutorily directed fee calculations for FY 
2024 fees, the Agency also made certain assumptions, including that: 
(1) facilities using expired Structured Product Labeling codes in 
eDRLS, that have not reregistered, were no longer manufacturing and 
marketing OTC monograph drugs; (2) facilities that have deregistered in 
eDRLS have exited the market; (3) facilities that FDA believes 
registered incorrectly as OTC monograph drug facilities (for example, 
because the associated drug listings for these facilities did not 
include OTC monograph drugs but instead indicated such products as OTC 
drug products under an approved drug application or OTC animal drug 
products) were not engaged in manufacturing or processing the finished 
dosage form of an OTC monograph drug; (4) facilities that registered 
but did not have an active OTC monograph drug product listing 
associated in their registration profile

[[Page 22160]]

were not manufacturing or processing such drug products; and (5) 
facilities that, at the close of FY 2023, remain on the arrears list 
for failure to satisfy the FY 2021, FY 2022, or FY 2023 facility fee 
are likely to be placed on the FY 2024 arrears list as well.
    Based on the above-referenced factors and assumptions, FDA 
estimates there will be 1,102 OMUFA fee-paying units. The Agency 
estimates that 57 percent (1,102 x 0.57 = 628, rounded) will incur the 
MDF fee and 43 percent (1,102 x 0.43 = 474, rounded) will incur the CMO 
fee.
    To determine the number of full fee-paying equivalents (the 
denominator) to be used in setting the OMUFA fees, FDA assigns a value 
of 1 to each MDF (628) and a value of \2/3\ to each CMO (474 x \2/3\ = 
316) for a full facility equivalent of 944 (rounded). The target fee 
revenue of $32,253,000 is then divided by 944 for an MDF fee of $34,166 
and a CMO fee of $22,777.

V. Fee Schedule for FY 2024

    The fee rates for FY 2024 are displayed in table 4.

                    Table 4--Fee Schedule for FY 2024
------------------------------------------------------------------------
                                                                FY 2024
                        Fee category                           Fee rates
------------------------------------------------------------------------
Facility Fees:
  MDF.......................................................     $34,166
  CMO.......................................................      22,777
------------------------------------------------------------------------

VI. Fee Payment Options and Procedures

    The new facility fee rates are for the period from October 1, 2023, 
through September 30, 2024. To pay the MDF and CMO fees, complete an 
OTC Monograph User Fee Cover Sheet, available at: https://userfees.fda.gov/OA_HTML/omufaCAcdLogin.jsp.
    A user fee identification (ID) number will be generated. Payment 
must be made in U.S. currency by electronic check or wire transfer, 
payable to the order of the Food and Drug Administration. The preferred 
payment method is online using electronic check (Automated Clearing 
House (ACH) also known as eCheck) or credit card for payments under 
$25,000 (Discover, VISA, MasterCard, American Express).
    FDA has partnered with the U.S. Department of the Treasury to use 
Pay.gov, a web-based payment application, for online electronic 
payment. The Pay.gov feature is available on the FDA website after 
completing the OTC Monograph User Fee Cover Sheet and generating the 
user fee ID number. Secure electronic payments can be submitted using 
the User Fees Payment Portal at https://userfees.fda.gov/pay. (Note: 
Only full payments are accepted through https://userfees.fda.gov/pay. 
No partial payments can be made online). Once an invoice is located, 
``Pay Now'' should be selected to be redirected to Pay.gov. Electronic 
payment options are based on the balance due. Payment by credit card is 
available for balances that are less than $25,000. If the balance 
exceeds this amount, only the ACH option is available. Payments must be 
made using U.S. bank accounts as well as U.S. credit cards.
    For payments made by wire transfer, include the unique user fee ID 
number to ensure that the payment is applied to the correct fee(s). 
Without the unique user fee ID number, the payment may not be applied, 
which could result in consequences of nonpayment per section 744M(e)(1) 
of the FD&C Act. The originating financial institution may charge a 
wire transfer fee. Applicable wire transfer fees must be included with 
payment to ensure fees are fully paid. Questions about wire transfer 
fees should be addressed to the financial institution. The account 
information for wire transfers is as follows: U.S. Department of the 
Treasury, TREAS NYC, 33 Liberty St., New York, NY 10045, Acct. No.: 
75060099, Routing No.: 021030004, SWIFT: FRNYUS33. If needed, FDA's tax 
identification number is 53-0196965.
    If you are assessed an FY 2024 OMUFA facility fee and believe your 
facility is not an OTC monograph drug facility as described in this 
notice, please contact [email protected].

    Dated: March 26, 2024.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2024-06723 Filed 3-28-24; 8:45 am]
BILLING CODE 4164-01-P

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.