**[Supporting Statement]{.underline}**

OTC Human Drugs; for Labeling Requirements

OMB Control Number 0910-0340

Docket Number 2004N-0534

A. **[Justification]{.underline}**

1\. [Circumstances Necessitating Information Collection.]{.underline}

The Food and Drug Administration (FDA) amended its regulations governing
labeling requirements for human drug products to establish a
standardized format for the labeling of all over-the-counter (OTC) drug
products. The rule, issued on March 17, 1999 (64 FR 13254), added new
section 201.66 to 21 CFR. The rule requires that the outside container
or wrapper of the retail package (or the immediate container label if
there is no outside container or wrapper) of all OTC drug products
include uniform headings and subheadings, presented in a standardized
order, with minimum standards for type size and other graphical
features. FDA issued these requirements because it had determined that
the design and format of labeling information varies considerably among
OTC drug products and consumers may have difficulty reading and
understanding the information presented on OTC drug product labeling.
The rule is intended to enable consumers to better read and understand
OTC drug product labeling and to apply this information to the safe and
effective use of OTC drug products.

FDAs legal authority to modify and simplify the manner in which certain
information is presented in OTC drug product labeling derives from
sections 201, 502, 505, 507, and 701 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 321, 352, 355, 357, and 371). Regulating the
order, appearance, and format of OTC drug product labeling is consistent
with FDAs authority to ensure that drug labeling conveys all material
information to consumers (21 U.S.C. 321(n) and 352 (a)), and that
labeling communicates this information in a manner that is likely to be
read and understood by the ordinary individual under customary
conditions of purchase and use (21 U.S.C. 352(c)). Regulating the
content of OTC drug product labeling is consistent with FDAs authority
to ensure that the products are safe and effective for use (21 U.S.C.
321(n), 321(p), 352, 355, and 357).

The labeling statements required under this rule are not subject to
review by the Office of Management and Budget because they are
originally supplied by the Federal Government to the recipient for the
purpose of disclosure to the public (5 CFR 1320.3(c)(2)) and therefore
do not constitute a collection of information under the Paperwork
Reduction Act of 1995 (44 U.S.C. 3510 et seq.).

Section 201.66 requires all OTC drug product manufacturers to format
labeling as set forth in subsections (c) and (d). FDA has learned from
the industry that OTC drug product manufacturers routinely redesign the
labeling of OTC drug products as part of their usual and customary
business practice. This rule provides varied time frames for
implementing the OTC labeling requirements. Therefore, the majority of
respondents have been able to format OTC drug product labeling in
accordance with 201.66 as part of their routine redesign practice,
creating no additional paperwork or economic burden. The rule, issued on
March 17, 1999, had a 6-year final implementation date of May 16, 2005.
Therefore, except for a small number of OTC sunscreen drug products that
have temporarily been exempted from this date, all OTC drug products
will need to be in compliance by May 16, 2005.

FDA initially estimated that, of the 39,310 stock keeping units (SKUs)
(individual products, packages, and sizes) marketed under a final
monograph when the OTC labeling requirements were issued on March 17,
1999, approximately 32 percent, or 12, 573 products, may necessitate
labeling format changes sooner than provided under their usual and
customary practice of label redesign. FDA estimated that of the 400
respondents who produce OTC drug products, including the 12,573 products
described above, each may be required to respond approximately 31.4
times to this rule outside of their usual and customary practice. Each
response was estimated to take, on the average, 4 hours, for a total of
50,292 hours per year. This burden was expected to be a one-time burden.

Although the usual and customary practice of label redesign minimized
the burden for the remaining 68 percent of SKUs, or 26,737 products,
marketed at the time the OTC labeling requirements were issued on March
17, 1999, additional time may have been necessary for each company to
make the format changes under this rule. FDA has estimated that of the
400 respondents who produce OTC drug products, each may be required to
respond approximately 66.8 times to bring the 26,737 products into
compliance with this rule. FDA estimated that for this group, each
response would take an average of 2.5 hours for a total of 66,842 hours.
This was expected to be a one-time burden. The chart reflects this group
on the second line.

Section 201.66(c) and (d) required OTC drug product manufacturers with
approved or pending new drug applications (NDAs) and abbreviated drug
applications (ANDAs) to submit to FDA supplements and amendments
regarding labeling changes pursuant to 21 CFR 314.60(a), 21 CFR 314.70,
21 CFR 314.97, and 21 CFR 314.96(a). In the proposed rule, FDA
attributed this paperwork burden to these specific NDA and ANDA
regulations. For the final rule, FDA redesignated the burden under 21
CFR 201.66(c) and (d). Under 21 CFR 314.70 (b)(33)(ii), application
holders must submit revised labeling to FDA for prior approval as
supplements to their approved applications. Under 21 CFR 314.60(a),
applicants must submit revised labeling to FDA as an amendment to a
pending application. Under 21 CFR 314.97, abbreviated application
holders must submit revised labeling to FDA for prior approval as
supplements to their approved applications (generic drugs). Under 21 CFR
314,96(a), applicants must submit revised labeling to FDA as an
amendment to a pending abbreviated application (generic drugs).

Under 21 CFR 201.66 (e), respondents subject to this rule are required
to submit requests in writing for exemptions and deferrals from the
specific requirements of 21 CFR 201.66. Based on its experience with
exemption and deferral requests under similar provisions, FDA estimates
that approximately 16% of the total number of respondents, or 25
manufacturers, packers, or distributors, are likely to submit such
requests on the average of one time per year. Such requests take an
average of 24 hours each for a total of 2,400 hours annually.

Section 201.66 requires all OTC drug product manufacturers to format
labeling as set forth in subsections (c) and (d). The estimated numbers
in the chart below included the one-time general formatting burden for
all respondents. The estimated number for subsections (c) and (d) also
include the one-time burden of submitting supplements and amendments
regarding labeling changes to approved or pending new drug applications
(NDAs) and abbreviated drug applications (ANDAs) under 21 CFR 314.60
(a), 21 CFR 314.70, 21 CFR 314.97, and 21 CFR 314.96(a). In the proposed
rule, FDA designated the paperwork burden under these NDA and ANDA
regulations. For the final rule, FDA redesignated the burden under 21
CFR 201.66(c) and (d).

Based on information and experience, FDA estimated that approximately
400 respondents would be subject to the provisions of 21 CFR 201.66(c)
and (d). Of the 400 respondents, 350 or fewer were subject to one or
more of the NDA and ANDA regulations requiring supplements or amendments
for labeling changes. On the average, each respondent was expected to
make one-time label formatting changes and submissions to NDAs and ANDAs
approximately 3.6 times, with each response an average of 2 hours. This
reporting burden, which was listed in the chart below, should have
passed as virtually all OTC drug products marketed on March 17, 1999
under NDAs and ANDAs have already been relabeled in the new OTC drug
labeling format.

2\. [How, By whom, and for What Purpose]{.underline}

The purpose of this rule was to establish a standardized format for the
labeling of all OTC drug products so that the labeling will be clear,
simple, and easier to read. Variability in the design, format, and
placement of required OTC drug product labeling information may make it
difficult for consumers to both find and read important information. In
order for consumers to safely and effectively use OTC drug products,
important labeling information must be readily accessible, readable,
easily understood, noted, and acted upon. If information is not
processed or is ignored due to factors affecting readability, such as
small print size, it cannot provide the health benefits that would
result from the safe and effective use of OTC drug products.
Nevertheless, warnings, cautions, and contraindications, which are
relatively technical, in the past have often been presented in small
print. Moreover, the amount of information and the lack of uniform
presentation of that information previously found on OTC drug product
labels often made it difficult to compare labels. The variability of
such information may lead to market inefficiencies that include
suboptimal purchases, inappropriate price-quality relationships, and
competitive inefficiencies. FDA has determined that standardized
labeling format, minimum print size, and consistent text will enhance
consumers ability to find and read relevant safety information.
Potential benefits include easier product comparison, improved consumer
decision making and self-treatment, and fewer adverse drug experiences.

3\. [Considerations of Information Technology]{.underline}

FDA allows pharmaceutical sponsors to submit Computer-Assisted New Drug
Applications (CANDA). CANDAs provide information (text, data, image)
electronically to facilitate FDA review of applications (including the
submission of information required under this rule, such as labeling
supplements and amendments). CANDAs enable FDA and pharmaceutical
sponsors to have electronic dialogue on labeling design and revisions
required by the rule. Focus on this approach has evolved into FDAs
Electronic Regulatory Submission and Review (ERSR) Program. This
initiative helps to ensure both the electronic availability of
information and the means to manipulate this information electronically
to yield a review.

4\. [Identification of Duplication]{.underline}

The reporting resulting from this rule only applies to the labeling of
OTC drugs subject to an approved application. This reporting requirement
is the only practical way for FDA to ensure that the product labeling
complies with the new format and content requirements. The reporting is
consistent with existing reporting requirements for products subject to
an approved application and does not duplicate any other information
collection.

5\. [Small Businesses]{.underline}

FDA is requiring affected entities to change the information panel for
affected OTC drug products. Among the steps FDA has taken to minimize
the impact on small entities is (this is discussed in more detail in the
final rule under part VIII Analysis of Impacts): (1) To provide enough
time for implementation to enable entities to use up existing label
stock, (2) to provide sufficient time to coordinate a substantial
proportion of the label changes with routine industry-initiated labeling
changes, (3) to provide a mechanism for applying for an exemption or a
deferral (when the requirements are judged inapplicable, impracticable,
or unnecessary), and (4) to provide additional time to comply for
individual OTC drug products having sales of less than a smaller dollar
figure. While this last provision to extend the compliance time provides
flexibility for a substantial number of individual OTC drug products,
the impact on overall retail sales is negligible. FDA has also provided
over 6 years from the date of the final rule (from March 17, 1999 until
May 16, 2005) for the required labeling changes to be implemented. FDA
believes that the above actions provide substantial flexibility and
reductions in cost for small entities.

6\. [Consequences of Less Frequent Information Collection and Technical
or Legal Obstacles]{.underline}

FDA would be unable to determine, before an OTC drug product is
available to consumers, whether the labeling complies with the revised
format and content requirements.

7\. [Inconsistencies with 5 CFR 1320.6 or Special
Circumstances]{.underline}

Data collection for applications is consistent with all the requirements
of section 1320.6.

8.  [Consultations with outside Sources]{.underline}

> In the [Federal Register]{.underline}, of January 4, 2005 (70 FR 362),
> the agency requested comments on the proposed collection of
> information. There were no comments received.

Prior to and after issuance of the final rule, many consumers expressed
concern to FDA about the legibility and understandability of OTC drug
product labeling. Many individuals, especially the elderly, mentioned
small print size, print style, and lack of color contrast. Consumers
stated that poor labeling legibility may cause them to select an
improper dose, which may result in adverse drug reactions. Consumers
have also submitted comments to FDA about the print size of OTC drug
product labeling in various OTC drug product rulemakings.

In response to these consumer comments and a citizen petition from a
pharmacist group, FDA published two requests for public comments in the
FEDERAL REGISTER that related to the legibility and understandability of
OTC drug product labeling. In addition, in an effort to solicit more
information and views on what specific aspects of OTC drug product
labeling design would improve communication to consumers, FDA held a
public hearing on September 29, 1995.

The hearing addressed consumer use, legibility and consumer
comprehension of OTC drug product labeling, OTC drug product labeling
design features, and behavioral issues. At the public hearing, 22
parties (including representatives from Government agencies,
universities, industry associations, consumer associations, and
corporations) made presentations.

In February 1996, FDA conducted a focus group study to investigate
consumers perceptions of risks and benefits of prescription and OTC
drugs. The study looked specifically at how consumers react to different
wording, claims, and statements (including the format and order of the
information) contained in prescription and OTC drug product labeling.
Participants confirmed that it would be beneficial to emphasize side
effects and warnings, either by using bullets, bold type, block
lettering, or larger type. Although there was no consensus about the
best placement order for the information, the participants agreed that
simple directions would be beneficial and labeling information should be
in plain English so they could better understand what the ingredients
were and how the drug works. Participants stated that this increased
knowledge would help to alleviate their concerns of any health risk from
taking the drug.

FDA published a proposed rule on February 27, 1997, setting forth for
public comment the new proposed labeling requirements that are the
subject of this supporting statement. FDA also requested comment on two
labeling studies discussed in the proposal and provided over 7 months
for comment. The final rule discussed the more than 1,800 comments
received.

9\. [Payments or gifts to Respondents]{.underline}

FDA has not provided and has no intention to provide any payment or gift
to respondents under these labeling requirements.

10\. [Confidentiality of Information]{.underline}

The reporting requirements have no confidentiality implications.

11\. [Sensitive Questions]{.underline}

There are no questions of a sensitive nature.

12\. [Total Hour Burden to Respondents]{.underline}

Section 201.66 requires all OTC drug product manufacturers to format
labeling as set forth in subsections (c) and (d). FDA has learned from
the industry that OTC drug product manufacturers routinely redesign the
labeling of OTC drug products as part of their usual and customary
business practice. This rule provides varied time frames for
implementing the OTC drug product labeling requirements. Therefore, the
majority of respondents could format OTC drug product labeling in
accordance with 201.66 as part of their routine redesign practice,
creating no additional paperwork or economic burden. FDA previously
estimated that 12,573 out of 39,310 SKUs (32%) marketed under a final
monograph were affected by the March 17, 1999 OTC drug product labeling
final rule and may have to implement labeling format changes sooner than
provided under their usual and customary practice of label redesign. FDA
estimated that of 400 respondents who produce OTC drug products,
including the 12,573 products described above, each may have to respond
approximately 31.4 times to this rule outside of their usual and
customary practice. Each response was estimated to take, on the average,
4 hours, for a total of 50,292 hours per year. This burden was expected
to be a one-time burden.

FDA estimated that the usual and customary practice of label design
would minimize the burden for the remaining 68% of SKUs (26,737
products) marketed when the final rule issued. FDA also determined that
additional time may be necessary for each company to make the format
changes under this rule. FDA estimated that of the 400 respondents who
produce OTC drug products, each may be required to respond approximately
66.8 times to bring the 26,737 products into compliance with this rule.
FDA estimated that for this group, each response would take an average
of 2.5 hours for a total of 66,842 hours. This was expected to be a
one-time burden. The chart reflects this group on the second line.

Section 201.66(c) and (d) also require OTC drug product manufacturers
with approved or pending new drug applications (NDAs and abbreviated
drug applications (ANDAs)) to submit to FDA supplements and amendments
regarding labeling changes pursuant to 21 CFR 314.60(a), 21 CFR 314.70,
21 CFR 314.97, and 21 CFR 314.96(a). Based on its records and
experience, FDA estimated that approximately 61 respondents had NDAs and
ANDAs to which supplements and amendments would be required. FDA
estimated that approximately 522 applications (350 NDAs and 172 ANDAs)
would require supplements or amendments regarding labeling changes under

201.66(c) and (d), an average of 8.5 submissions per respondent. Based
on information and experience, FDA estimated that each submission would
take an average of 2 hours to prepare, for a total of 1,040 hours
annually. This burden was also expected to be a one-time burden.

Under 21 CFR 201.66(e), respondents subject to this rule could submit
requests in writing for exemptions and deferrals from the specific
requirements of 21 CFR 201.66. Based on its experience with exemption
and deferral requests under similar provisions, FDA estimated that
approximately 16% of the total number of respondents, or 25
manufacturers, packers, or distributors, were likely to submit such
requests on the average of one time per year. FDA estimated that these
requests may average 24 hours each, for a total of 2,400 hours annually.

Since March 17, 1999, FDA has published six additional major final rules
on OTC drug monographs and several minor amendments to existing final
monographs. The effective date for relabeling OTC drug products in the
new format occurred by the end of 2004, except for OTC sunscreen drug
products (for which implementation of the new labeling requirements has
been stayed indefinitely while FDA amends the monograph for these
products) and a small number of other OTC drug products with annual
sales less than \$25,000. Based on information in the six final rules
issued since 1999, FDA estimates that 11,250 additional SKUs (out of the
original 26,737 that needed to be relabeled in the new format) have
already been affected by the final rule. Thus, 15,487 SKUs remain to be
affected by the OTC drug product labeling final rule, minus
approximately 2,000 OTC sunscreen drug product SKUs. All of these except
the sunscreen drug products will need to have the new labeling format by
May 16, 2005, for products initially introduced or initially delivered
for introduction into interstate commerce after that date. As the number
of products remaining to be affected by the OTC drug products labeling
final rule is close to the number of products that were affected at the
time the final rule published on

March 17, 1999, in this current supporting statement FDA is using the
same numbers of respondents, annual frequency per response, and total
annual responses it estimated in 1999.

TABLE 1.\--Estimated Annual Reporting Burden

  --------------------------------------------------------------------------
  Estimated                                                      
  Annual                                                         
  Reporting                                                      
  Burden                                                         
  ------------ ------------- ----------- ----------- ----------- -----------
  21 CFR       Number of     Annual      Total       Hours Per   Total[^1]
  Section      Respondents   Frequency   Annual      Response    Hours
                             per         Responses               
                             Response                            

  201.66[^2]   400           31.43       12,573      4           50,292

  201.66       400           66.8        26,737      2.5         66,842

  201.66 (c),  61            8.5         522         2           1,044
  (d)^2^                                                         

  201.66(e)    25            4           100         24          2,400

  Total                                  39,932                  120,578
  --------------------------------------------------------------------------

There are no capital costs or operating and maintenance costs associated
with this information collection.

One-time burden.

13\. [Total Annual Cost Burden to Respondents]{.underline}

Based on an hourly industry cost of \$108 (wages plus overhead), the
total cost burden to respondents would be \$5,803,488 (53,736 X \$108).

14\. [Annualized Cost to FDA]{.underline}

FDA estimates that it would take application reviewers approximately 30
minutes to review supplements and amendments and other revised OTC drug
product labeling submissions (for products marketed under OTC drug
monographs). Based on an hourly cost to FDA of \$108 (wages plus
overhead), and based on a total of 13,487 submissions \[15,487 minus
2,000\], the total potential cost to FDA if labeling for all SKUs was
reviewed would be \$ 1,456,596.

15\. [Explanation of in Item 13 and 14, Changes in Burden]{.underline}

The reporting burden for the OTC labeling final rule has changed from
that in the proposal to show that the burden, which was originally
attributed to regulations for the filing of supplements and amendments
to new drug applications and abbreviated new drug application, is more
appropriately attributed to 210.66 (c) and (d). The reporting burden in
the final rule also includes separate entries for formatting and filing
requests for exemptions and deferrals, which were inadvertently omitted
in the proposed rule.

16\. [Publication of Information Collection Results/Statistical
Reporting]{.underline}

FDA does not intend to publish tabulated results of the information
collection requirements that would be imposed by these regulations.

17\. [Display of OMB Expiration Date on Form Approval Date]{.underline}

There are no forms associated with this collection.

18 [Exceptions to Certification Statement.]{.underline}

There are no exceptions to the certification statement identified in
Item 19, Certification for Paperwork Reduction Act Submission, of OMB
Form 83-I.

[^1]:

[^2]: