General Administrative Rulings and Decisions; Amendment to the Examination and Investigation Sample Requirements; Companion Document to Direct Final Rule

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 2

[Docket No. 98N-0417]

General Administrative Rulings and Decisions; Amendment to the

Examination and Investigation Sample Requirements; Companion Document

to Direct Final Rule

AGENCY: Food and Drug Administration, HHS.

ACTION: Proposed rule.

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SUMMARY: The Food and Drug Administration (FDA) is proposing to amend

its regulations regarding the collection of twice the quantity of food,

drug, or cosmetic estimated to be sufficient for analysis. This action

increases the dollar amount that FDA will consider to determine whether

to routinely collect a reserve sample of a food, drug, or cosmetic

product in addition to the quantity sufficient for analysis. Experience

has demonstrated that the current dollar amount does not adequately

cover the cost of most quantities sufficient for analysis plus reserve

samples. This proposed rule is a companion to the direct final rule

published elsewhere in this issue of the Federal Register. This action

is part of FDA's continuing effort to achieve the objectives of the

President's ``Reinventing Government'' initiative, and it is intended

to reduce the burden of unnecessary regulations on food, drugs, and

cosmetics without diminishing the protection of the public health.

DATES: Comments must be received on or before December 9, 1998.

ADDRESSES: Submit written comments to the Dockets Management Branch

(HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061,

Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Sharon M. Sheehan, Office of

Regulatory Affairs (HFC-230), Food and Drug Administration, 12720

Twinbrook Pkwy., Rockville, MD 20855, 301-827-0412.

SUPPLEMENTARY INFORMATION:

I. Background

This proposed rule is a companion to the direct final rule

published in the final rules section of this issue of the Federal

Register. This companion proposed rule will provide the procedural

framework to finalize the rule in the event that the direct final

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rule receives any significant adverse comment and is withdrawn. The

comment period for this companion proposed rule runs concurrently with

the comment period for the direct final rule. Any comments received

under this companion proposed rule will also be considered as comments

regarding the direct final rule. FDA is publishing the direct final

rule because the rule contains a noncontroversial change, and FDA

anticipates that it will receive no significant adverse comment.

A detailed rationale for the rule is set forth in the preamble to

the direct final rule and in section II of this document. If no

significant adverse comment is received in response to the direct final

rule, no further action will be taken related to this proposed rule.

Instead, FDA will publish a confirmation document within 30 days after

the comment period ends, confirming that the direct final rule will go

into effect on February 8, 1998. Additional information about FDA's

direct final rulemaking procedures is set forth in a guidance published

in the Federal Register of November 21, 1997 (62 FR 62466).

If timely significant adverse comments regarding the rule are

received, FDA will publish a document withdrawing the direct final rule

within 30 days after the comment period ends. FDA then will proceed to

respond to all of the comments received regarding the rule and, if

appropriate, the rule will be finalized under this proposed rule using

usual notice-and-comment procedures.

This action is part of FDA's continuing effort to achieve the

objectives of the President's ``Reinventing Government'' initiative,

and it is intended to reduce the burden of unnecessary regulations on

food, drugs, and cosmetics without diminishing the protection of the

public health.

II. Examination and Investigation Samples

Section 2.10 (21 CFR 2.10) regulates the examination and

investigation samples and sets out provisions related to the collection

of an official sample for FDA's analysis. FDA investigators routinely

collect the samples and pay the owner of the regulated food, drug, or

cosmetic product either the regular selling price, or if acceptable to

the owner, the dealer's invoice cost plus a nominal charge (usually 10

to 15 percent) (see Investigations Operations Manual, January 1998, ch.

4, section 416.2, at 129). The regulations require the investigator to

collect an extra amount of the product beyond what is needed for

analysis, known as a reserve sample, to allow for additional analysis

(see section 702(b) of the Federal Food, Drug, and Cosmetic Act (21

U.S.C. 372(b)) and Sec. 2.10(c)). Under most circumstances the

investigator is to collect at least ``twice the quantity estimated by

him to be sufficient for analysis * * *.''

One of the few narrow exceptions to the requirement to collect at

least twice the quantity estimated to be sufficient for analysis is

when the cost of the quantity sufficient for analysis and the reserve

sample together exceeds $50. The decision whether to collect twice the

quantity sufficient for analysis if the cost of that amount exceeds the

regulatory amount (currently $50) is made on a case-by-case basis.

The current regulatory amount as set forth in Sec. 2.10(b)(2) was

established in 1955 as Sec. 1.700(b)(2) (21 CFR 1.700(b)(2)) and

published in the Federal Register of December 20, 1955 (20 FR 9525 at

9539). Section 1.700 was reorganized and republished as Sec. 2.10, and

the regulatory amount was increased from $10 to $50 in 1977 (see 42 FR

15559, March 22, 1977).

A regulatory amount of $150 more accurately reflects an amount that

would cover the cost of most quantities sufficient for analysis plus

reserve samples. The amount of $150 is based, in part, on the Consumer

Price Index (CPI) from the Bureau of Labor and Statistics, Department

of Commerce. In August 1977, the CPI was 61.2; in August 1996, the CPI

was 157.3. This change represents an increase of approximately 157

percent. Therefore, $50 in 1977 is equivalent to approximately $128

today. Considering that the regulatory amount has changed every 20

years, setting the amount at $150 contemplates that another increase

likely will not occur for several years.

III. Environmental Impact

FDA has determined under 21 CFR 25.30(h) that this action is of a

type that does not individually or cumulatively have a significant

effect on the human environment. Therefore, neither an environmental

assessment nor an environmental impact statement is required.

IV. Analysis of Economic Impacts

A. Benefit-Cost Analysis

FDA has examined the impacts of the proposed rule under Executive

Order 12866, under the Regulatory Flexibility Act (5 U.S.C. 601-612),

and under the Unfunded Mandates Reform Act (Pub. L. 104-4). Executive

Order 12866 directs agencies to assess all costs and benefits of

available regulatory alternatives and, when regulation is necessary, to

select regulatory approaches that maximize net benefits (including

potential economic, environmental, public health and safety, and other

advantages; distributive impacts; and equity). FDA believes that this

proposed rule is consistent with the regulatory philosophy and

principles identified in the Executive Order. This proposed rule

increases the dollar limit FDA uses to determine whether a quantity

estimated as twice that which is sufficient for analysis will routinely

be collected. The rule does not adversely affect the owners of foods,

drugs, or cosmetics from which samples are collected. This proposed

rule is not a significant regulatory action as defined by the Executive

Order and so is not subject to review under the Executive Order.

B. Regulatory Flexibility Analysis

The Regulatory Flexibility Act requires agencies to analyze

regulatory options that would minimize any significant impact of a rule

on small entities. The agency certifies that this proposed rule will

not have a significant economic impact on a substantial number of small

entities. Therefore, under the Regulatory Flexibility Act, no further

analysis is required.

C. Unfunded Mandates Reform Act of 1995

The Unfunded Mandates Reform Act requires that agencies prepare an

assessment of anticipated costs and benefits before proposing any rule

that may result in an annual expenditure by State, local, or tribal

governments, in the aggregate, or by the private sector, of $100

million (adjusted annually for inflation). This proposed rule does not

impose any mandates on State, local, or tribal governments, nor is it a

significant regulatory action under the Unfunded Mandates Reform Act.

Industry will incur no net costs as a result of this proposed rule.

V. Paperwork Reduction Act of 1995

FDA tentatively concludes that this proposed rule contains no

collections of information. Therefore, clearance by the Office of

Management and Budget under the Paperwork Reduction Act of 1995 is not

required.

VI. Request for Comments

Interested persons may, on or before December 9, 1998, submit to

the Dockets Management Branch (address above) written comments

regarding this proposed rule. Two copies of any comments are to be

submitted, except that individuals may submit one copy.

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Comments are to be identified with the docket number found in brackets

in the heading of this document. Received comments may be seen in the

office above between 9 a.m. and 4 p.m., Monday through Friday. All

comments received will be considered as comments regarding the direct

final rule. In the event the direct final rule is withdrawn, all

comments received regarding the direct final rule and this companion

proposed rule will be considered under this proposed rule.

List of Subjects in 21 CFR Part 2

Administrative practice and procedure, Cosmetics, Drugs, Foods.

Therefore under the Federal Food, Drug, and Cosmetic Act and under

authority delegated to the Commissioner of Food and Drugs, 21 CFR part

2 is proposed to be amended as follows:

PART 2--GENERAL ADMINISTRATIVE RULINGS AND DECISIONS

1. The authority citation for 21 CFR part 2 continues to read as

follows:

Authority: 21 U.S.C. 321, 331, 335, 342, 346a, 348, 351, 352,

355, 357, 360b, 361, 371, 372, 374; 15 U.S.C. 402, 409.

2. Section 2.10 is amended by revising paragraph (b)(2) to read as

follows:

Sec. 2.10 Examination and investigation samples.

* * * * *

(b) * * *

(2) The cost of twice the quantity so estimated exceeds $150.

* * * * *

Dated: September 11, 1998.

William K. Hubbard,

Associate Commissioner for Policy Coordination.

[FR Doc. 98-25359 Filed 9-24-98; 8:45 am]

BILLING CODE 4160-01-F