[Federal Register Volume 62, Number 201 (Friday, October 17, 1997)]
[Rules and Regulations]
[Pages 53958-53959]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-27452]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

21 CFR Part 1309

[DEA Number--169N]


Comprehensive Methamphetamine Control Act of 1996; Registration 
Fees

AGENCY: Drug Enforcement Administration (DEA), Justice.

ACTION: Notice of fee wavier.

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SUMMARY: DEA is waiving a portion of the registration fee for non-
retail distributors of pseudoephedrine, phenylpropanolamine, and 
combination ephedrine drug products. Under the Comprehensive 
Methamphetamine Control Act of 1996 (MCA), wholesale distributors of 
these drug products are subject to the existing List I chemical 
registration and fee requirements. However, because the drug products 
are distributed in substantially different channels than other List I 
chemicals, the existing pre-registration investigation procedures, 
which were established primarily with respect to the handlers of 
chemicals, as opposed to drug products, are not necessarily applicable 
to the new type of applicant. DEA will be reviewing the pre-
registration investigation procedures to determine what changes will be 
necessary to account for the different manner of distribution of the 
drug products. Recognizing that changes are likely to be made in the 
pre-registration process, thus causing changes to the fees assessed, 
DEA is waiving a portion of the fee at this time, rather than requiring 
that new applicants pay a fee that would not be consistent with the 
resources actually expended in the issuance of the registration.

EFFECTIVE DATE: October 17, 1997.

FOR FURTHER INFORMATION CONTACT:
G. Thomas Gitchel, Chief, Liaison and Policy Section, Office of 
Diversion Control, Drug Enforcement Administration, Washington, D.C. 
20537, Telephone (202) 307-7297.

SUPPLEMENTARY INFORMATION: The MCA's removal of the exemption for 
pseudoephedrine, phenylpropanolamine, and combination ephedrine drug 
products (regulated drug products) opens up to chemical registration 
and regulation a new and different segment of industry from that 
previously subject to the chemical controls. Prior to the MCA the group 
subject to chemical registration consisted primarily of specialty 
chemical handlers distributing products of limited consumer end-use to 
a largely industrial customer base. By contrast, the principal group 
subject to registration under the MCA consists of general merchandisers 
distributing a wide variety of consumer products to retail outlets for 
sale to the public. Often, one company will operate several 
distribution centers to serve wholly owned or independent retail 
outlets. In response to applications submitted by this new group, DEA 
is re-examining the pre-registration investigation process for issuing 
registrations. This process will affect the registration application 
fees.
    The procedures for issuing a chemical registration and the 
associated application fee were developed in 1994 as part of the 
implementation of the Domestic Chemical Diversion Control Act of 1993 
(DCDCA). (For specific details regarding the procedures and fees, see 
DEA's notice of proposed rulemaking (NPRM) regarding Implementation of 
the Domestic Chemical Diversion Control Act of 1993 (Pub. L. 103-200) 
which was published in the Federal Register on October 13, 1994 (59 FR 
51887)). The procedures were developed based on the type of applicants 
expected under the DCDCA, e.g., specialty chemical handlers dealing 
with products of limited consumer end-use. These applicants dealt 
almost exclusively in chemicals and often distributed from contract 
operated warehouses/storage depots. Pursuant to the requirements of the 
Office of Management and Budget (OMB) Circular A-25, the costs and 
resources required to conduct the pre-registration investigation and 
issue the registration were assessed to the applicants as the 
application fee.
    The group subject to registration under the MCA is significantly 
different, consisting principally of general merchandisers distributing 
hundreds or thousands of different consumer products, often from a 
large number of applicant-owned warehouse/distribution centers, to 
retail outlets for sale to the public. The volume of regulated drug 
products handled is often only a very small portion of the total volume 
of products distributed by the location. For these applicants,the pre-
registration procedures developed for chemical handlers are not 
entirely suitable. DEA has, therefore, initiated a review of the pre-
registration procedures to determine what changes will be necessary to 
make the process consistent with the different activities of this group 
of applicants. This review will affect the costs and resources 
associated with the issuance of registrations to these applicants and, 
thus, the fee to be charged. DEA will publish notice, with opportunity 
for comment, in the Federal Register regarding any proposed change to 
the procedures and consequent changes to the fees.
    The MCA removed the exemption from regulation for combination 
ephedrine drug products effective

[[Page 53959]]

October 3, 1996, and will remove the exemption from regulation for 
pseudoephedrine and phenylpropanolamine drug products effective October 
3, 1997, making persons who distribute the respective products subject 
to the registration requirement on those dates. Determination of the 
appropriate procedures and amendment of the regulations to set the new 
fees will extend well beyond those deadlines for registration. 
Therefore, DEA is waiving a portion of the application fee for new 
registration. It would be inconsistent with the principles of OMB 
Circular A-25 to charge a fee for a specific service, e.g., completing 
the processing of the application and the pre-registration 
investigation, knowing that the costs and resources to be expended in 
providing that service will change. Persons who have already applied 
for registration to distribute regulated drug products and paid the 
existing fee will be refunded the amount of fee that is being waived.
    The Acting Deputy Administrator of DEA is, therefore, waiving that 
portion of the fee for registration as a non-retail distributor of 
regulated drug products associated with the 12 hours of investigator 
time allocated for the on-site visit and travel time, which, at $39.92 
per hour, amounts to $479.00 (See 59 FR 51892). The remaining 
administrative costs and time allotted for background checks and 
reports will continue. Thus the fee for an initial application for 
registration as a non-retail distributor of regulated drug products is 
$116.00. That fee will remain in effect until the review of the 
registration procedures has been completed and a determination has been 
made regarding how the processing of such applications and the pre-
registration investigation will be carried out. At that time, a notice 
will be published in the Federal Register regarding the procedures to 
be followed and fee that will be required for future applications.
    This waiver applies only to applicants for registration as non-
retail distributors of regulated drug products. All other applicants 
remain subject to the full fees, as set forth in Title 21, Code of 
Federal Regulations, Section 1309.11. As noted earlier, persons who 
have already submitted an application for registration as a non-retail 
distributor of regulated drug products and paid the full fee will be 
provided with a $479.00 refund.

    Dated: October 8, 1997.
James S. Milford,
Acting Deputy Administrator.
[FR Doc. 97-27452 Filed 10-16-97; 8:45 am]
BILLING CODE 4410-09-M