United States 

Department of 

Agriculture

Animal and 

Plant Health 

Inspection 

Service

January 2013

Regulatory Impact Analysis &

Initial Regulatory Flexibility Analysis

Proposed Rule

2011-0049

RIN 0579-AD64

Viruses, Serums, Toxins, and Analogous 

Products; Single Label Claim for Veterinary 

Biological Products

Policy & Program Development

Policy Analysis & Development
i

Summary

APHIS is proposing to amend the Virus-Serum-Toxin Act regulations to require the use 

of a simpler labeling format. This simpler uniform format would allow biologics licensees and 

permittees to more clearly communicate product performance to the user. Biologics licensees 

and permittees would also be required to provide a standardized summary of the efficacy and 

safety data that are submitted to APHIS in support of the issuance of a full product license or 

conditional product license. The summary of efficacy and safety data would be made available 

to the public on the APHIS Center for Veterinary Biologics (CVB) Web site. We believe that 

the benefits of this rule justify the costs.

A simpler, uniform format would allow biologics licensees and permittees to more 

clearly communicate product performance information to the end user. Veterinarians, the largest 

group of consumers of veterinary biologics, often find labeling indications statements based on 

the current guidance to be confusing, and have expressed a desire for indications statements to 

provide insight into the actual performance of the product, including summaries of safety and 

efficacy data. In addition, the rule would simplify the evaluation of efficacy studies, focusing on 

a basic claim of effectiveness compared to the more complex, tiered approach historically used 

by APHIS. The proposed rule would reduce the amount of time required by CVB to evaluate

study data. . A novel veterinary biological product can generate revenue in the neighborhood of 

$5 to $10 million per year. Therefore, increased efficiencies in the generation and evaluation of 

efficacy data should result in fewer delays in bringing a product to market. In addition, a simpler 

label may benefit those manufacturers, both large and small, who export their products, as 

foreign manufacturers do not use a tiered approach to label claims.
ii

This rule would affect all veterinary biologics licensees and permittees. Currently, there 

are approximately 98 veterinary biological establishments, including permittees. These 

companies produce about 1,900 different products, and there are about 11,700 active approved 

labels for veterinary biologics. There were about 3,100 labels submitted for approval in the last 

12 months by about two-thirds of the companies. 

Costs for licensees and permittees of the proposed rule are not expected to be significant, 

whether the affected entity is small or large. APHIS anticipates that the only costs associated 

with the proposed labeling format would be one-time costs incurred by licensees and permittees 

in having labels for existing licensed products reformatted in accordance with the proposed rule. 

Most biologics companies, in the course of normal business, use a just-in-time method for 

producing new labels and readily alter their content and those labels are computer generated. 

Labels are regularly altered, for example, to enhance marketing through changes in design. 

Products that are not yet licensed but are within 6 months of licensure at the time these 

proposed regulations may become effective would be expected to be fully compliant no later 

than 1 year after licensure. Products that are more than 6 months away from licensure at the time 

these proposed regulations may become effective would be expected to be fully compliant at the 

time of licensure. For products that are currently licensed, the standardized summary of efficacy

and safety data and the revised labels would have to be submitted to APHIS within 4 years of the 

time these proposed regulations may become effective. CVB would consider written requests to 

extend the time period for submitting the summaries by an additional 2 years if necessary.

In many instances manufacturers would not have to produce new labeling materials 

before they would do so in the normal course of business, and would only incur additional 

administrative costs to track the changes. Costs incurred for minor label changes that are
iii

coordinated with planned label changes are estimated to range between $99 and $500 per product 

with labels needing to be changed. We estimate that there are about 6,200 labels associated with 

about 1,000 products for which there would be this type of coordinated change. For these label 

changes, the total cost is estimated to range between $99,000 and $500,000. 

We expect that about 5,500 of the active labels, associated with 900 products, would be 

changed other than in conjunction with a planned change. In these cases, manufacturers would 

incur costs for prepress, graphic design, and printing in addition to administrative costs. All 

labels for a specific product would be changed at the same time. Based on these activities, the 

costs of minor label changes that are not coordinated with planned label changes could range 

from $465 to $1,613 in administrative and labor costs for each product with labels needing to be 

changed and from $100 to $275 per new label in materials cost. Because veterinary biologics 

manufacturers are likely to make changes for groups of products, all cattle products for example, 

there are likely to be savings in administrative and labor costs for those grouped changes. 

However, based on the above ranges, the total cost for these uncoordinated label changes is 

estimated to be between $968,000 and $3 million. 

Minor costs may be incurred in producing the standardized summaries of efficacy and 

safety data for currently licensed products within the 4-year implementation period. We estimate 

that about 1,700 summaries would need to be completed as a result of this rule because efficacy

and safety studies are frequently provided for multiple products. The estimated cost would be

about $55 per summary, or about $94,000 in total.
iv

Table of Contents

Summary.............................................................................................................................. i

Introduction......................................................................................................................... 1

Overview of the Action and affected Entities..................................................................... 2

Expected Benefits and Costs of the Rule............................................................................ 3

Initial Regulatory Flexibility Analysis................................................................................ 8

Reasons Action is Being Considered.............................................................................. 8

Objectives of and Legal Basis for the Rule .................................................................... 8

Potentially Affected Small Entities................................................................................. 9

Projected Reporting, Recordkeeping, and Other Compliance Requirements............... 11

Duplication, Overlap, or Conflict with Existing Rules and Regulations...................... 11

Alternatives to minimize Significant Economic Impacts of the Rule........................... 11
1

Introduction

The Animal and Plant Health Inspection Service (APHIS) issues licenses for veterinary

biological products based, in part, on acceptable efficacy and safety data. Prescribed information 

included on final container labels, carton labels, and enclosures is addressed in 9 CFR part 112. 

APHIS is proposing to amend the regulations to require provision on labels of a single 

standardized indications statement describing the efficacy of the product as well as a statement 

referring the end user to an APHIS Web site for efficacy and safety data. The standardized 

indications statement (e.g., a label claim stating that the product can be used “as an aid in the 

prevention of ___” or “as an aid in the control of ___” would be replaced with the statement 

“This product has been shown to be effective for the vaccination of healthy animals ___ weeks 

of age or older against ___”) would replace current indications statements that may reflect any of 

four different levels of effectiveness. In addition to a standardized indications statement, the 

amendment would also provide for the public disclosure of a summary (with confidential 

business information removed) of the efficacy and safety data submitted to APHIS in support of 

the issuance of the product license. 

Effects of this action would be to clarify information available to customers by providing 

for a simpler indications statement on labels and public disclosure of data summaries from the 

efficacy and safety studies conducted for product licensure.

This document provides a benefit-cost analysis, as required by Executive Orders 12866 

and 13563, which direct agencies to assess all costs and benefits of available regulatory

alternatives and, if regulation is necessary, to select regulatory approaches that maximize net 

benefits (including potential economic, environmental, public health and safety effects, and 
2

equity). Executive Order 13563 emphasizes the importance of quantifying both costs and 

benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This document 

also examines the potential economic effects of the rule on small entities, as required by the 

Regulatory Flexibility Act.

Overview of the Action and affected Entities

APHIS is proposing to amend the Virus-Serum-Toxin Act regulations to provide for the 

use of a simpler labeling format. This simpler uniform format would allow biologics licensees 

and permittees to more clearly communicate product performance to the user. Biologics 

licensees and permittees would also provide a standardized summary of the efficacy and safety 

data that are submitted to APHIS in support of the issuance of a full product license or 

conditional product license. The summary of efficacy and safety data would be made available 

to the public on the APHIS Center for Veterinary Biologics (CVB) Web site. 

This rule would affect all veterinary biologics licensees and permittees. Currently, there 

are approximately 98 veterinary biological establishments, including permittees. These 

companies produce about 1,900 different products, and there are about 11,700 active approved 

labels for veterinary biologics. There were about 3,100 labels submitted for approval in the last 

12 months by about two-thirds of the companies. The average number of labels submitted per 

firm over that time frame was 46 and the median was 8. Companies undergoing acquisition or 

name changes submit high numbers of labels. Also, many companies must maintain a number of 

different approved labels for products that are exported to meet the various requirements of

importing countries. 
3

Expected Benefits and Costs of the Rule

This proposal would amend the regulations to require that labels of veterinary biologics 

have a standardized indications statement describing the efficacy of the product as well as a 

statement referring the end user to an APHIS Web site for efficacy and safety data. We believe 

that the benefits of this rule justify the costs. 

The simpler, uniform labeling format along with publicly available safety and efficacy

data would assist the licensees and permittees in communicating product performance to their 

domestic and international customers. Veterinarians, the largest group of consumers of 

veterinary biologics, often find labeling indications statements based on the current guidance to 

be confusing, and have expressed a desire for indications statements to provide insight into the 

actual performance of the product, including summaries of safety and efficacy data. In addition, 

the rule would simplify the evaluation of efficacy studies, focusing on a basic claim of 

effectiveness compared to the more complex, tiered approach historically used by APHIS. The 

proposed rule would reduce the amount of time required by CVB to evaluate study data. A novel 

veterinary biological product can generate revenue in the neighborhood of $5 to $10 million per 

year. Therefore, increased efficiencies in the generation and evaluation of efficacy data should 

result in fewer delays in bringing a product to market. In addition, a simpler label may benefit 

those manufacturers who export their products, as foreign manufacturers do not use a tiered 

approach to label claims.

Section 112.2 of the regulations currently requires labeling materials to include the true 

name; name of producer, permittee, or foreign manufacturer; the license or permit number; 

storage temperature; full instructions for the proper use of the product; warning statements on 

multiple dose final containers; a burn statement if the product contains viable or dangerous 
4

organisms or viruses; withholding statement for products intended for use in food animals; 

expiration date; number of doses; recoverable quantity of contents; a serial number; antibiotics 

added during the production process; any other statement that is not false or misleading; and 

various restrictions. Section 112.5 of the regulations describes the review and approval process 

of labeling materials. Adding a single indications/efficacy statement and a statement referring 

the end user to an APHIS Web site where efficacy and safety summary data may be found 

should not significantly alter the recordkeeping burden. This proposed rule contains no new 

information or recordkeeping requirements.

Costs associated with the proposed rule are not expected to be significant. APHIS 

anticipates that the only costs associated with the proposed labeling format would be one-time 

costs incurred by licensees and permittees in having labels for existing licensed products 

reformatted in accordance with the proposed rule. The Food and Drug Administration (FDA) 

has developed a model to estimate the cost of labeling changes in consumer labeling 

regulations.1 While not directly applicable to veterinary biologics labeling changes, the model 

does include cost information on various areas pertinent to a veterinary biologics label change. 

These areas include labor, materials, administration and recordkeeping. The costs depend on the 

extent of the change (from minor to extensive), type of printing method used for the label being 

changed and whether the label change can be coordinated with planned label changes by the

manufacturer that occur in the ordinary course of business.

Because the proposed label changes would only require new text and not a label redesign, 

they are considered minor changes. Most biologics companies, in the course of normal business, 

 

1 Model to Estimate Costs of Using Labeling as a Risk Reduction Strategy for Consumer Products Regulated by the 

Food and Drug Administration. March 2011. Prepared by RTI International for the Food and Drug Administration. 

Contract Number GS-10F-0097L, Task Order 5.
5

use a just-in-time method for producing new labels and can therefore readily alter their content. 

Labels are regularly altered, for example, to enhance marketing through changes in design. 

Products that are not yet licensed but are within 6 months of licensure at the time these proposed 

regulations may become effective would be expected to be fully compliant no later than 1 year 

after licensure. Products that are more than 6 months away from licensure at the time these 

proposed regulations may become effective would be expected to be fully compliant at the time 

of licensure. For products that are currently licensed, the standardized summary of efficacy and 

safety data and revised labels would have to be submitted to APHIS within 4 years of the time 

these proposed regulations may become effective. CVB would consider written requests to 

extend the time period for submitting the summaries by an additional 2 years if necessary.

Of the approximately 11,700 active labels, 53 percent, or about 6,200, are no more than 4 

years old. This suggests that more than one-half of the labels affected by the rule would be 

replaced in the ordinary course of business during the implementation period. Thus, in these 

instances, manufacturers would not have to produce new labeling materials before they would do 

so in the normal course of business. 

Costs incurred for minor label changes that are coordinated with planned label changes at 

a manufacturer include the costs of administrative activities. Even if manufacturers can 

coordinate a labeling change, they still incur costs associated with understanding the regulation, 

determining their responses, tracking the required change throughout the labeling change 

process, and reviewing and updating their records of product labels. Other types of costs, such 

as prepress, graphic design, and printing the labels are not attributable to the regulation if the 

labeling change is coordinated with a planned change. All labels for a specific product would be 

changed at the same time. Costs incurred for minor label changes that are coordinated with 
6

planned label changes are estimated to range between $99 and $500 per product, with a midpoint estimate of $310, per product with labels that need to be changed.2

 There are about 1,000 

products associated with the 6,200 labels for which there would be coordinated changes. For 

these label changes, the total cost is estimated to range between $99,000 and $500,000 with a 

mid-point estimate of $310,000. 

Costs incurred for minor label changes that cannot be coordinated with planned label 

changes include costs for prepress, graphic design, and printing the labels in addition to 

administrative activities. Labeling information can be displayed on a package in two ways – it 

can be printed directly on the package or it can be printed on a label, which is then applied to the 

package. All labels for a specific product would be changed at the same time. All current 

veterinary biologics products are labeled with pre-printed, computer generated labels applied to 

the package and most are produced in-house.

3

 Paper is the most commonly used material in 

label production. 

We expect that about 5,500 of the active labels, associated with about 900 products, 

would be changed other than in conjunction with a planned change. It is estimated that the costs

of a minor label change that is not coordinated with a planned change using computer generated

printing is between $465 to $1,613 in administrative and labor costs (with a mid-point estimate 

of $971) for each product with labels that need to be changed; and between $100 and $275 in 

materials cost (with a mid-point estimate of $158) per new label.

4

 Because most veterinary

biologics companies handle label changes in-house, the cost does not include graphics design or 

 

2

Ibid.

3 Dr.Kevin Ruby, Senior Staff Microbiologist; Policy, Evaluation and Licensing; Center for Veterinary Biologics; 

USDA-APHIS. Personal communication.

4 Model to Estimate Costs of Using Labeling as a Risk Reduction Strategy for Consumer Products Regulated by the 

Food and Drug Administration. March 2011. Prepared by RTI International for the Food and Drug Administration. 

Contract Number GS-10F-0097L, Task Order 5.
7

prepress consulting fees. Veterinary biologics manufacturers are also likely to make changes for 

groups of products, all cattle products for example, when the changes are uncoordinated with 

planned label changes. Therefore, there are likely to be savings in administrative and labor costs 

for those grouped changes. Based on the above ranges, the total cost for these uncoordinated 

label changes is estimated to range between $968,000 and $3 million, with a mid-point estimate 

of $1.7 million. 

Minor costs may be incurred in producing the standardized summaries of efficacy and 

safety data for currently licensed products within the four year implementation period. Products 

whose original efficacy data are not available would require a statement on their data summary

stating, “Original efficacy data is not available because the product was licensed “x” years ago.” 

We estimate that it would take 1 hour to review instructions, search existing data sources, gather 

and maintain the data needed, and complete and review the collection of information. This 

activity would most likely be done by a mid-level manager. At a rate of $55.04 per hour,5this 

labor will cost a manufacturer about $55. Cost of submission by electronic mail or regular mail 

would be negligible. There are approximately 98 veterinary biological establishments, including 

permittees. These companies produce about 1,900 different products that would need to be 

summarized on our Web site. However, companies often perform efficacy and safety studies on 

a combination of products and then license the various products separately. We estimate that 

about 1,700 data summaries would need to be completed. In total, these 1,700 summaries may

cost about $94,000 to complete.

 

5 May 2011 National Industry-Specific Occupational Employment and Wage Estimates, Bureau of Labor Statistics, 11-1021, 

General and Operations managers, mean hourly wage.
8

Initial Regulatory Flexibility Analysis

The Regulatory Flexibility Act requires agencies to evaluate the potential effects of their 

proposed and final rules on small businesses, small organizations and small governmental 

jurisdictions. This initial regulatory flexibility analysis describes expected impacts of this 

proposed rule on small entities, as required by section 603 of the Act.

Reasons Action is Being Considered

Current APHIS guidelines provide examples of label claims that may be used to reflect 

the expected performance of the product provided that appropriate efficacy data have been 

submitted and approved by APHIS. The guidelines describe performance requirements and 

allowable indications statements for four different levels of effectiveness.

Outreach to various stakeholders, including biologics manufacturers, the American 

Veterinary Medical Association, private and academic veterinarians, and pet owners, indicated 

general support for a change in the format in which expectations of product efficacy are 

communicated on labels. The proposed standardized indications statement and summary of 

safety and efficacy data would provide insight into the actual performance of the product and 

product differences, but not require disclosure of proprietary information. 

Currently licensed products would not need to be re-licensed based on these proposed 

changes. This proposal is not intended to change the efficacy requirements for currently licensed 

veterinary biological products. The licensees would be required to provide the same data as are

currently required. 

Objectives of and Legal Basis for the Rule

APHIS administers and enforces the Virus-Serum-Toxin Act, as amended (21 U.S.C. 

151-159). The regulations issued pursuant to the Act are intended to ensure that veterinary
9

biological products are pure, safe, potent, and efficacious when used according to label 

instruction. We are proposing to amend the regulations to require the use of a simpler labeling 

format, and to require biologics licensees to provide a standardized summary of the efficacy and 

safety data submitted in support of licensing. The simpler, uniform format would more clearly 

communicate product performance to end users and enable APHIS to evaluate efficacy studies 

more efficiently by focusing on a basic claim of effectiveness compared to the more complex, 

tiered approach historically used.

Potentially Affected Small Entities

This rule would affect all veterinary biologics licensees and permittees. Currently, there 

are approximately 98 veterinary biological establishments, including permittees. These 

establishments are classified within the industry Biological product (except diagnostic) 

manufacturing in the North American Industry Classification System (NAICS 325414). The 

Small Business Administration (SBA) has established guidelines for determining which 

businesses are considered small. According to SBA size standards for NAICS 325414, 

operations with not more than 500 employees are considered small entities. The vast majority of 

these establishments are small. In 2007, more than 95 percent of biological product 

manufacturers had fewer than 500 employees, and more than 70 percent had fewer than 50 

employees.6 

Costs for licensees and permittees of the proposed rule are not expected to be significant, 

whether the affected entity is small or large. APHIS anticipates that the only costs associated 

with the proposed labeling format would be one-time costs incurred by licensees and permittees 

in having labels for existing licensed products reformatted in accordance with the proposed rule. 

 

6

2007 Economic Census. U.S. Census Bureau, Department of Commerce.
10

Most biologics companies, in the course of normal business, use a just-in-time method for 

producing new labels (i.e., do not store large inventories of labels but rather obtain labels as 

needed for current vaccine production) and readily alter their content. Labels are regularly 

altered, for example, to enhance marketing through changes in design. 

Products that are not yet licensed but are within 6 months of licensure at the time these 

proposed regulations may become effective would be expected to be fully compliant no later 

than 1 year after licensure. Products that are more than 6 months away from licensure at the time 

these proposed regulations may become effective would be expected to be fully compliant at the 

time of licensure. For products that are currently licensed, the standardized summary of efficacy

and safety data and revised labels would have to be submitted to APHIS within 4 years of the 

time these proposed regulations may become effective. CVB would consider written requests to 

extend the time period for submitting the summaries by an additional 2 years if necessary.

In many instances manufacturers would not have to produce new labeling materials before they

would do so in the normal course of business, and would only incur additional administrative 

costs to track the changes. Costs incurred for minor label changes that are coordinated with 

planned label changes are estimated to range between $99 and $500 per product with labels 

needing to be changed. We estimate that there are about 6,200 labels associated with about 

1,000 products for which there would be this type of coordinated change. For these label 

changes, the total cost is estimated to range between $99,000 and $500,000. 

We expect that about 5,500 of the active labels, associated with 900 products, would be 

changed other than in conjunction with a planned change. In these cases, manufacturers would 

incur costs for prepress, graphic design, and printing in addition to administrative costs. All 

labels for a specific product would be changed at the same time. Based on these activities, the 
11

costs of minor label changes that are not coordinated with planned label changes could range 

from $465 to $1,613 in administrative and labor costs for each product with labels needing to be 

changed and from $100 to $275 per new label in materials cost. Because veterinary biologics 

manufacturers are likely to make changes for groups of products, all cattle products for example, 

there are likely to be savings in administrative and labor costs for those grouped changes. 

However, based on the above ranges, the total cost for these uncoordinated label changes is 

estimated to be between $968,000 and $3 million. 

Minor costs may be incurred in producing the standardized summaries of efficacy and 

safety data for currently licensed products within the 4-year implementation period. We estimate 

that about 1,700 summaries would need to be completed as a result of this rule because efficacy

and safety studies are frequently provided for multiple products. The estimated cost would be 

about $55 per summary, or about $94,000 in total.

Projected Reporting, Recordkeeping, and Other Compliance 

Requirements

This proposed rule contains no new information or recordkeeping requirements under the 

Paperwork Reduction Act of 1995.

Duplication, Overlap, or Conflict with Existing Rules and Regulations

APHIS has not identified any duplication, overlap, or conflict of the proposed rule with 

other Federal rules.

Alternatives to minimize Significant Economic Impacts of the Rule

Based on the information we have, there is no reason to conclude that adoption of this 

proposed rule would result in any significant economic effect on a substantial number of small 

entities. However, we do not currently have all of the data necessary for a comprehensive 

analysis of the effects of this proposed rule on small entities and invite comments on potential 
12

effects. In particular, we are interested in determining the number and kind of small entities that 

may incur benefits or costs from the implementation of this proposed rule. Further, we are 

interested in receiving information that could be used to further quantify the benefits of this 

proposed rule.