15902 Federal Register / Vol. 62, No. 64 / Thursday, April 3, 1997 / Notices

Food and Drug Administration

[Docket No. 93N–0457]

Robert Elbert; Denial of Hearing; Final

Debarment Order

AGENCY: Food and Drug Administration,

HHS.

ACTION: Notice.

SUMMARY: The Food and Drug

Administration (FDA) denies Robert

Elbert’s request for a hearing and issues

a final order permanently debarring

Robert Elbert, 15000 SW. David Lane,

apt. G–61, Lake Oswego, OR 97035,

from providing services in any capacity

to a person that has an approved or

pending drug product application. FDA

bases this order on its finding that Mr.

Elbert was convicted of a felony under

Federal law for conduct relating to the

regulation of a drug product under the

Federal Food, Drug, and Cosmetic Act

(the act).

EFFECTIVE DATE: April 3, 1997.

ADDRESSES: Application for termination

of debarment to the Dockets

Management Branch (HFA–305), Food

and Drug Administration, 12420

Parklawn Dr., rm. 1–23, Rockville, MD

20857.

FOR FURTHER INFORMATION CONTACT:

Mary E. Catchings, Center for Drug

Evaluation and Research (HFD–7), Food

and Drug Administration, 7500 Standish

Pl., Rockville, MD 20855, 301–594–

2041.

SUPPLEMENTARY INFORMATION:

I. Background

On December 12, 1991, the United

States District Court for the District of

Oregon entered judgment against Mr.

Robert Elbert, doing business as Thrifty

Drug Store, under a plea of guilty, for

one count of knowingly selling,

purchasing, and trading drug samples, a

Federal felony offense under sections

301(t) of the act (21 U.S.C. 331(t)),

303(b)(1) of the act (21 U.S.C. 333(b)(1)),

and 503(c)(1) of the act (21 U.S.C.

353(c)(1)).

In a certified letter received by Mr.

Elbert on September 14, 1994, the thenActing Deputy Commissioner for

Operations offered Mr. Elbert an

opportunity for a hearing on the

agency’s proposal to issue an order

under section 306(a) of the act (21

U.S.C. 335a(a)) debarring him from

providing services in any capacity to a

person that has an approved or pending

drug product application. FDA based

the proposal to debar Mr. Elbert on its

finding that he had been convicted of a

felony under Federal law for conduct

relating to the regulation of a drug

product.

The certified letter informed Mr.

Elbert that his request for a hearing

could not rest upon mere allegations or

denials, but must present specific facts

showing that there was a genuine and

substantial issue of fact requiring a

hearing. The letter also notified Mr.

Elbert that, if it conclusively appeared

from the face of the information and

factual analyses in his request for a

hearing that there was no genuine and

substantial issue of fact which

precluded the order of debarment, FDA

would enter summary judgment against

him and deny his request for a hearing.

In a letter dated October 11, 1994, Mr.

Elbert requested a hearing, and in a

letter dated November 9, 1994, Mr.

Elbert submitted arguments and

information in support of his hearing

request. In his request for a hearing, Mr.

Elbert does not dispute that he was

convicted of a felony under Federal law

as alleged by FDA. He argues, however,

that the agency’s proposal to debar him

is unconstitutional because a retroactive

application of the debarment provisions

would violate the U.S. Constitution’s ex

post facto, due process, and equal

protection clauses.

The Deputy Commissioner for

Operations has considered Mr. Elbert’s

arguments and concludes that they are

unpersuasive and fail to raise a genuine

and substantial issue of fact requiring a

hearing. The legal arguments that Mr.

Elbert offers do not create a basis for a

hearing (see 21 CFR 12.24(b)(1)). Mr.

Elbert’s arguments are discussed below.

II. Mr. Elbert’s Arguments in Support of

a Hearing

A. Ex Post Facto Argument

Mr. Elbert first argues that the ex post

facto clause of the U.S. Constitution

prohibits application of section

306(a)(2) of the act to him because this

section was not in effect at the time of

Mr. Elbert’s criminal conduct. The

Generic Drug Enforcement Act (GDEA)

of 1992, including section 306(a)(2), was

enacted on May 13, 1992, and Mr. Elbert

was convicted on December 13, 1991.

An ex post facto law is one that

reaches back to punish acts that

occurred before enactment of the law or

that adds a new punishment to one that

was in effect when the crime was

committed (Ex Parte Garland, 4 Wall.

333, 377, 18 L. Ed. 366 (1866); Collins

v. Youngblood, 497 U.S. 37 (1990)).

Mr. Elbert’s claim that application of

the mandatory debarment provisions of

the act is prohibited by the ex post facto

clause is unpersuasive, because the

intent of debarment is remedial, not

punitive. Congress created the GDEA in

response to findings of fraud and

corruption in the generic drug industry.

Both the language of the GDEA and its

legislative history reveal that the

purpose of the debarment provisions set

forth in the GDEA is ‘‘to restore and

ensure the integrity of the abbreviated

new drug application (ANDA) approval

process and to protect the public

health.’’ (See section 1, Pub. L. 102–282,

GDEA of 1992.)

In a suit challenging a debarment

order issued by FDA (58 FR 69368,

December 30, 1993), the

constitutionality of the debarment

provision was upheld against a similar

challenge under the ex post facto clause.

The reviewing court affirmed the

remedial character of debarment:

Without question, the GDEA serves

compelling governmental interests unrelated

to punishment. The punitive effects of the

GDEA are merely incidental to its overriding

purpose to safeguard the integrity of the

generic drug industry while protecting public

health.

Bae v. Shalala, 44 F.3d 489, 493 (7th

Cir. 1995); see also, DiCola v. Food and

Drug Administration, 77 F.3d 504 (D.C.

Cir. 1996)

Because the intent of the GDEA is

remedial rather than punitive, Mr.

Elbert’s argument that the GDEA

violates the ex post facto clause must

fail. (See Bae v. Shalala, 44 F.3d at 496–

497.)

B. Due Process and Equal Protection

Arguments

Mr. Elbert further argues that an ‘‘ex

post facto application of later enacted

statutory provisions to prior conduct

and convictions of an individual is

violative of the express provisions of

Amendment V, forbidding that any

person be deprived of ‘life, liberty, or

property without due process of law.’’’

In his discussion, Mr. Elbert refers to

‘‘the loss of his right and ability to be

able to provide services to a person who

has an approved or pending drug

product application,’’ which suggests

that he may also be making a ‘‘takings’’

argument under the Fifth Amendment.

Mr. Elbert’s argument that his due

process rights under the Fifth

Amendment would be violated by

debarment based upon a conviction

entered prior to enactment of the GDEA

is not persuasive. In Usery v. Turner

Elkhorn Mining Co., 96 S. Ct. 2882, 2893

(1976), the Court held that the

retroactive application of a remedial

statute designed to compensate disabled

coal miners did not violate the due

process clause of the Fifth Amendment.

Legislation adjusting rights and burdens

is not unlawful even if the effect of the
Federal Register / Vol. 62, No. 64 / Thursday, April 3, 1997 / Notices 15903

legislation is to impose a new duty or

burden based upon past acts (id.

(citations omitted)). The Court noted,

however, that it would ‘‘hesitate to

approve the retrospective imposition of

liability on any theory of deterrence * *

* or blameworthiness’’ (id. (citations

omitted)). Neither exception applies to

debarment.

As discussed above, debarment is

remedial, in that it prohibits certain

individuals from providing services to a

person that has an approved or pending

drug product application, in order to

meet the legitimate regulatory purpose

of restoring the integrity of the drug

approval and regulatory process and

protecting the public health. In

addition, the remedial nature of the

GDEA is not diminished simply because

the GDEA deters debarred individuals

and others from future misconduct (U.

S. v. Halper, 109 S. Ct. 1892, 1901, n.7

(1989); Bae v. Shalala, 44 F.3d 489, 493

(7th Cir. 1995)). Thus, debarment for a

1991 conviction does not violate Mr.

Elbert’s due process rights.

With regard to his ‘‘takings’’ assertion,

Mr. Elbert has not established that his

debarment affects any property interest

protected by the Fifth Amendment. The

expectation of employment is not

recognized as a protected property

interest under the Fifth Amendment

(Hoopa Valley Tribe v. Christie, 812

F.2d 1097, 1102 (9th Cir. 1986); Chang

v. United States, 859 F.2d 893, 896–897

(Fed. Cir. 1988)). One who voluntarily

enters a pervasively regulated industry,

such as the pharmaceutical industry,

and then violates its regulations, cannot

successfully claim that he has a

protected property interest when he is

no longer entitled to the benefits of that

industry (Erikson v. United States, 67

F.3d 858 (9th Cir. 1995)).

Mr. Elbert further alleges that his

debarment denies him ‘‘equal protection

of law,’’ insofar as persons other than

individuals are subject to debarment for

acts occurring after enactment of the

GDEA, and individuals are subject to

debarment for acts and convictions that

occurred prior to enactment of the

statute as well. This argument also must

fail. A statutory classification, such as

that made in the GDEA between

individuals and persons other than

individuals, that neither burdens a

fundamental right nor targets a suspect

class, will be sustained if the

classification bears a rational

relationship to a legitimate legislative

end (Romer v. Evans, 116 S. Ct. 1620,

1627 (1996)). The classification will be

upheld even if it works to the

disadvantage of a particular group (id).

Moreover, under the rational basis

standard of review, Congress need not

articulate the rationale supporting its

classification (FCC v. Beach, 113 S. Ct.

2096, 2102 (1993)). The distinction

drawn between individuals and persons

other than individuals may well have

been supported by the fact that Congress

had before it evidence from hearings

that at least one company that had been

found guilty or had admitted to fraud

had obtained new management prior to

passage of the GDEA (Generic Drug

Enforcement: Hearing on H.R. 2454

Before the Subcomm. on Health and the

Environment of the House Comm. on

Energy and Commerce, 102d Cong., 60–

61 (1991) (statement of Dee Fensterer,

President, Generic Pharmaceutical

Industry Association)).

Mr. Elbert does not dispute the fact

that he was convicted as alleged by

FDA. Under section 306(l)(1)(B) of the

act, a conviction includes a guilty plea.

The facts underlying Mr. Elbert’s

conviction are not at issue. Mr. Elbert’s

legal arguments do not create a basis for

a hearing. Accordingly, the Deputy

Commissioner for Operations denies Mr.

Elbert’s request for a hearing.

III. Findings and Order

Therefore, the Deputy Commissioner

for Operations, under section 306(a) of

the act and under authority delegated to

him (21 CFR 5.20), finds that Robert

Elbert has been convicted of a felony

under Federal law for conduct relating

to the regulation of a drug product.

As a result of the foregoing finding,

Robert Elbert is permanently debarred

from providing services in any capacity

to a person with an approved or

pending drug product application under

section 505, 507, 512, or 802 of the act

(21 U.S.C. 355, 357, 360b, or 382), or

under section 351 of the Public Health

Service Act (42 U.S.C. 262), effective

April 3, 1997 (sections 306(c)(1)(B) and

(c)(2)(A)(ii) and 201(dd) of the act (21

U.S.C. 321(dd))). Any person with an

approved or pending drug product

application who knowingly uses the

services of Mr. Elbert, in any capacity,

during his period of debarment, will be

subject to a civil money penalty (section

307(a)(6) of the act (21 U.S.C.

335b(a)(6))). If Mr. Elbert, during his

period of debarment, provides services

in any capacity to a person with an

approved or pending drug product

application, he will be subject to civil

money penalties (section 307(a)(7) of the

act). In addition, FDA will not accept or

review any ANDA or abbreviated

antibiotic drug application submitted by

or with the assistance of Mr. Elbert

during his period of debarment.

Mr. Elbert may file an application to

attempt to terminate his debarment

under section 306(d)(4) of the act. Any

such application would be reviewed

under the criteria and processes set

forth in section 306(d)(4)(C) and

(d)(4)(D) of the act. Such an application

should be identified with Docket No.

93N–0457 and sent to the Dockets

Management Branch (address above).

All such submissions are to be filed in

four copies. The public availability of

information in these submissions is

governed by 21 CFR 10.20(j). Publicly

available submissions may be seen in

the Dockets Management Branch

between 9 a.m. and 4 p.m., Monday

through Friday.

Dated: March 17, 1997.

Michael A. Friedman,

Deputy Commissioner for Operations.

[FR Doc. 97–8555 Filed 4–2–97; 8:45 am]

BILLING CODE 4160–01–F

[Docket No. 94N–0171]

Discovery Experimental and

Development, Inc.; Denial of a Hearing

and Refusal to Approve a New Drug

Application for Deprenyl (Deprenyl

Citrate) Gelatin Capsules and Liquid;

Final Order

AGENCY: Food and Drug Administration,

HHS.

ACTION: Notice.

SUMMARY: The Commissioner of Food

and Drugs (the Commissioner) is

denying a request for a hearing and is

issuing an order under the Federal

Food, Drug, and Cosmetic Act (the act)

refusing to approve a new drug

application (NDA) for Deprenyl

(deprenyl citrate) submitted by

Discovery Experimental and

Development, Inc., 29949 S.R. 54 West,

Wesley Chapel, FL 33543 (Discovery).

Discovery requested an opportunity for

a hearing after the Food and Drug

Administration (FDA) issued a proposal

to refuse to approve the firm’s NDA for

Deprenyl. FDA is denying Discovery’s

request for a hearing because Discovery

failed to raise any genuine and

substantial issue of fact that would

entitle it to such a hearing. FDA bases

this order refusing to approve

Discovery’s product on a finding that,

among other deficiencies in the

application, there is insufficient

information to determine whether

Discovery’s deprenyl citrate is safe for

use or will have the effect it purports or

is represented to have under the

conditions of use prescribed,

recommended, or suggested in the

proposed labeling.

EFFECTIVE DATE: April 3, 1997.