September 20 , 2011 

### PEER REVIEW SUMMARY REPORT
**External Peer Review of EPA’s**  **Draft Document Approach to Assessing Non**  **- cancer Health Effects from**  **Formaldehyde and Benefits from**  **Reducing Non -**  **cancer Health Effects as a Results of Im**  **plem enting Formaldehyde Em**  **ission Lim its for**  **Com posite Wood Products** 
**Prepared for:** U.S. Environmental Protection Agency National Program Chemicals Division Office of Pollution Prevention and Toxics 1200 Pennsylvania Avenue, NW (7404T) Washington, DC 20460 **Prepared by:** Versar, Inc. 6850 Versar Center Springfield, VA 22151
Contract No. EP
- C
- 07
- 025 Task Order 129

**Peer Reviewers:** John R. Balmes, M.D. G lenn C. Blomquist, Ph.D. A. My rick Freeman III, Ph.D. Shelby Gerking, Ph.D. David Kriebel, Sc.D. Frederick J. Miller, Ph.D., Fellow ATS Rebecc a T. Parkin, Ph.D. , MPHi **TABLE OF CONTENTS**
**I. INTRODUCTION** 
................................ ................................ ................................ .................. 1 **II. CHARGE TO REVIEWERS** 
................................ ................................ ................................ 3 **III. INDIVIDUAL REVIEWER COMMENTS ON NON**  **- CANCER HEALTH**  **EFFECTS**

**– DERIVATION OF CONCENTRATION**  **- RESPONSE FUNCTIONS** 
....... 9 John R. Balmes, M.D.
................................ ................................ ................................ ........... 10 David Kriebel, Sc.D.
................................ ................................ ................................ ............. 15 Frederick J. Miller, Ph.D., Fellow ATS
................................ ................................ ................ 20 Rebecca T. Parkin, Ph.D., MP H
................................ ................................ ........................... 27 **IV. INDIVIDUAL REVIEWER COMMENTS ON THE BENEFITS ASSESSMENT**  **APPROACH**
................................ ................................ ................................ ......................... 34 Glenn C. Blomquist, Ph.D.
................................ ................................ ................................ ... 35 A. My rick Freeman III, Ph.D.
................................ ................................ ............................... 44 Shelby Gerking, Ph.D.
................................ ................................ ................................ .......... 52 **V. PEER REVIEWER COMMENT TAB**  **LE ON NON -**  **CANCER HEALTH EFFECTS** 

**– DERIVATION OF CONCENTRATION**  **- RESPONSE FUNCTIONS** 
..... 61 **VI. PEER REVIEWER COMMENT TABLE ON THE BENEFITS ASSESSMENT**  **APPROACH**
................................ ................................ ................................ ......................... 791

**I. INTRODUCTION**  In March 2008, the Sierra Club and other organizations and individuals petitioned EPA under Section 21 of the Toxic Substances Control Act (TSCA). The petitioners requested that EPA use TSCA Section 6 to adopt a newly
- promulgated Ca lifornia Air Resources Board (CARB) Airborne Toxic Control Measure (ATCM) 1 as a national standard for formaldehyde emissions from hardwood pl ywo od, particleboard, and medium
- density f iberboard products. T he petitioners expressed particular concern over th e levels of formaldehyde found in emergency housing provided for Hurricane Katrina survivors, but noted that there are no federal regulations on formaldeh yde emissions from composite wood products other than those applicable to manufactured housing regulat ed b y the U.S. Department of Housing and Urban Development. In response to the petition, EPA announced in the Federal Register on Ju ne 27, 2008 (73 FR 36504) 2 that EPA would initiate a proceeding to investigate whether and what ty pe of regulatory or other action might be appropriate to protect against risks that may b e posed by

f ormaldeh yd e emitted from composite wood products. In December 2008, EPA published an Advance Notice of Proposed Rulemaking (ANPR) to publicly i nitiate the investigation and obtain stakeholder input (73 FR 73620). 3 On July 7 , 2010, the Formaldeh yde Standards for Composite Wood Products Act (FSCWPA) was signed into law. T his statute, which adds a Title VIt o TSCA, establishes formaldeh yd e emission standards for hardwood pl ywood, particleboard, and medium
- density f iberboard that are identical to the CARB ATCM Phase II standards. 4 TSCA Title VId irects EPA to promulgate implementing regulations by J anuary 1, 2013 that address: sell
- through dates for products; stockpiling; third
- p art y testing and certification; auditing and reporting of third
- part y certifiers; recordkeeping; chain of custod y; l abeling; enforcement; products made with no - added formaldeh yde (NAF) and ultra
- low emitting formaldehyde (U LEF) resins; laminated products; finished goods; hardboard; and products containing de minimis amounts of composite wood products. In support of the implementing regulations, as with other rulemakings that are determined to be “significant regulatory

a ction[s]” under Executive Order 12 866

— Regulatory Planning and Review , EPA is required to conduct an economic anal ys is of the costs and benefits associated with the rulemaking. O n June 2, 2010, EPA released a draft document titled Toxicological Review of Formaldeh yd e - Inhalation Assessment: InS upport of Summary Information on the Integrated Risk Information Sy stem (IRIS). 5 This draft IR IS a ssessment, which recently underwent independent scientific peer review by the National Academy

o f Sciences (NAS) 6 , addresses both non - cancer and cancer human health effects that may result from chronic inhalation exposure to formaldeh yde. H owever, this draft IR IS assessment does not include concentration
- response functions for non
- cancer health effects, which are needed for the benefits assessment. T here fore, this draft report titled Approach to Assessing Non

- cancer Health Effects from Formaldehyde and Benefits from Reducing Non

- cancer Health Effects as a Result of Implementing Formaldehyde Emission Limits for Composite Wo od Products (referred to
1 Available at http://www.arb.ca.gov/toxics/comp wo od/com pw ood.htm 2 Available at http://www.gpo.gov/fdsys/pkg/FR
- 2008
- 06
- 27/pdf/E8
- 14618.pdf 3 Available at http://www.gpo.gov/fdsys/pkg/FR
- 2008
- 12
- 03/pdf/E8
- 28585.pdf 4 Available at http://www.arb.ca.gov/toxics/comp wo od/com pw ood.htm 5 Available at http:/

/cfpub.epa.gov/ncea/iris_drafts/recordisplay.cfm?deid=223614 6 Available at http://www.nap.edu/catalog.php?record_id=131422

hereafte r as draft Approach Document) was developed, which provides discussion of several non - cancer endpoints as well as a discussion of the derivation of concentration
- response functions, uncertainties, and EPA’s proposed approach for using the concentration
- res ponse functions in the benefits assessment. **Peer Reviewers: Experts in**  **Non -**  **cancer Health Effects :**  **John R. Balmes, M.D.** University

of California, San Francisco San Francisco, CA 94110 **David Kriebel, Sc.D.** University

of Massachusetts L owell Lowell, M A 01854 **Frederick J. Miller, Ph.D., Fellow ATS** Fred J. Miller & Associates LLC Cary , NC 27511 **Rebecca T.**  **Pa rkin, Ph.D.**  **, MPH** The George Washington University Medical Center Washington DC, 20037 **Experts in Environmental and Health Economics: G** **lenn C.**  **Blo mquist, Ph.D.**  University

of Kentucky Lexington, KY 40506 **A. Myrick Freeman III, Ph.D.** Bowdoin College Georgetown, ME 94548 **Shelby Gerking, Ph.D.** University

of Central Florida Orlando, Florida 328163

**II. CHARGE TO REVIEWERS**  EPA is requesting comment on the draft document, “Approach to Assessing Non
- cancer Health Effects from Formaldeh yde and Benefits from Reducing Non
- cancer Health Effects as a Result of Implementing Formaldehyde Emission L imits for Composite Wood Products” (draft Approach Document). The purpose of this draft Approach Document is to describe how EPA derived concentration
- response functions for formaldehyde effects on sensory irritation, asthma, and female reproductive toxicity , as well as the approach EPA will take to use these concentrati on - response functions to estimate benefits from the contribution of reduced non
cancer health effects as a result of implementing formaldeh yde emission standards for composite wood products. The draft document describes in detail how the concentration
- resp onse functions were derived as well as uncertainties. The draft document also briefl y describes the epidemiological studies that were used to derive the concentration
- response functions; however, a detailed analy sis of these studies (as well as others) is included in the 2010 draft IRIS assessment for formaldehyde 7 and is therefore not included in the draft Approach Document. The draft Approach Document also describes how EPA plans to use the concentration
- response functions to estimate benefits. It provide s sample calculations but not the actual benefits assessment. The full benefits assessment will be provided in the economic anal ys is that will be publicly available (at www.regulations.gov ) when the draft proposed r ule is published. The draft IR IS assessment for formaldehyde underwent peer review by the National Academ y of Sciences (NAS) 8 , and EPA requests that the peer reviewers of the draft Approach Document do not duplicate the efforts of the NAS. EPA is request ing comment specifically on the derivation of the concentration
- response functions and the approach on how the Agency plans to use these functions to assess benefits. EPA requests that if the reviewers have comments on EPA’s proposed approach that they pro vide specific recommendations for improvements, including specific references and how those references are relevant to the Approach. In addition, if reviewers have information that EPA should have considered, please provide that information. **Specific Cha rge Questions on**  **Derivation of Concentration -**  **Response Functions** Sensory Irritation The literature base of residential epidemiology studies of the irritation effects with quantitative concentration
- response data was limited, but data were available from which a concentration
response function could be estimated for eye irritation. 1) Please comment on whether the concentration
- response function is appropriately derived from the studies used in the draft Approach Document. 2) Please comment on the validity of e xtrapolating the concentration
- response function and using the function to estimate effects at concentrations below 100 ppb. 3) The studies considered for the concentration
- response function are residential studies because residential exposures are the focus of the rule and the residential studies avoid some of the

7 Available at http://cfpub.epa.gov/ncea/iris_drafts/recordisplay.cfm?d eid=223614 8 Available at http://www.nap.edu/catalog.php?record_id=131424

limitations of other ty

pes of studies (e.g., controlled exposure chamber studies used high, acute exposures, and occupational studies reflect high exposure levels and potential dose
- rate effects fro m peak exposures). Are there other studies (e.g., chamber or non
- residential studies) that should be used as supporting evidence for the currently derived concentration
response function for ey e irritation? I f so, please provide information about the stu dies and discuss how they

should be used to support the concentration
- response function. 4) Are there other sensory irritation endpoints besides ey e irritation for which a concentration
response function can and should be developed for assessing effects at c oncentrations below 100 ppb? I f so, please provide references of appropriate studies and a description of how the studies could be used to develop a concentration
- response function. Asthma Several studies of the association between formaldehyde and asthma have been published and these were quantitativel y summarized in a meta
- analy sis by McGwin et al. (2010). 5) Please comment on whether the McGwin et al. (2010) meta
- anal ys is is an appropriate summary of the association between formaldehyde inhalation expos ures and childhood asthma. 6) Please comment on whether EPA chose the appropriate function from the McGwin et al. paper to use in the benefits assessment. Female Reproductive Toxicity The literature base describing reproductive effects of formaldeh yd e expo sure in humans is limited; however, there are supportive findings from the animal toxicological literature. The epidemiologic literature suggests an association between formaldeh yde and increased risk of spontaneous abortion and a related delay in time to pregnancy

(i.e., reduced fertility). The onl y study with quantitative concentration
- response data was Taskinen et al. (1999). The a priori hy

pothesis in Taskinen et al. (1999) was that formaldehyde would be associated with decreased fertility . The prim ary anal ys es showed that there was a statistically significant reduction of fertility

among the women in the highest exposure group that appeared to be concentration dependent. Post
- hoc subgroup analyses showed that stratification of the 39 women in the h ighest exposure group b y reported glove use yi elded effect estimates whose confidence intervals overlapped. The FDR for the 17 women who were classified as not wearing gloves was 0.51 [95% CI: 0.28 −0.92]. The FDR for women who were classified as alway s or sometimes wearing gloves was 0. 79 [95% CI : 0.47 −1.23]. 7) In light of the results regarding glove use, in what way (s) can the Taskinen et al. results be used to support calculating a concentration response for formaldeh yde inhalation risk to time to pregnancy? 8) Please comment on whether the concentration
- response function is appropriately derived from the Taskinen et al. (1999) study
.5

**Specific Charge Questions on the Benefits Assessment Approach**  Sensory Irritation The concentration
- response function for the prevalence of ey e irritatio n is based on Hanrahan et al. (1984). While Hanrahan does not identify the relevant time period for this relationship, L iu et al. (1991) produced qualitatively similar results for a two
- week time period. We assumed that the concentration
- response relations hip for ey e irritation is for a two
- week period and multiplied the concentration
- response function times 26 to obtain the number of cases of ey e irritation experienced in one ye ar. The concentration
- response curve used is non
- linear, which means that the annual approach may not produce an exact measure of the benefits, but it is believed that the bias is probably relativel y small given the small change in exposure. 1) Please comment on whether the concentration
- response function is used appropriatel y in the benefits assessment approach. The concentration
- response curve is for an acute effect occurring at a time less than the one
- ye ar time step of the exposure model. The willingness to pay to avoid cases of eye irritation is calculated for each ye ar of anal y sis by multiplying the number of cases in a y ear b y the marginal willingness to pay

value to avoid one case. This may produce biased results, but the direction of that bias is unknown. On one hand, s ome studies have suggested that the willingness to pay p er s ymptom - day declines as the number of s ymptom - day s avoided increases. In other words, the value to reduce two sy mptom - day s of some effect is less than two times the value for one s ymptom - day . Therefore, this approach may

overstate the total value. On the other hand, this analy sis onl y applies values to one symptom, eye irritation, largel y because this is the onl y s ymptom for which an effective concentration
- response curve was derived. However, there is evidence that there are other forms of minor ey e, nose, and throat irritation associated with formaldeh yde exposure. Since eye irritation is the largest of the median values from the Tolley

et al. (1986) study , the values used here likely represent a lower bound on the true effect of multiple sy mptoms. A reasonable upper bound of the total effect for one sy mptom - day

would be sum of the willingness to pay for one s ymptom - day

of each effect individually
. 2) Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate i n this context. The concentration
- response function for the prevalence of ey e irritation is for a single two
- week period. The annualized approach used an adjusted concentration
- response relationship that consisted in multiplying the concentration
- respons e function obtained from Hanrahan et al. (1984) b y 26 two
- week periods. 3) Please comment on whether the adjustment of the concentration
- response function is appropriate in the annualized approach.6

Asthma The concentration
- response relationship for asthma incidence is given as an odds ratio for children exposed to formaldehyde. An odds ratio is a way of comparing the difference in the probability

of an event, in this case asthma diagnosis, occurring in groups exposed at different levels. The odds ratio is u sed to determine the willingness to pay for any change in emissions exposure over a 16 ye ar period. We assume that the probability of being diagnosed with asthma is uniformly

distributed across these 16 ye ars. The use of an odds ratio implies that the co ncentration
- response relationship is non
- linear. However, given that the change in exposure is relatively small, the results from using this implied non
- linear function are anticipated to be similar to the results if we were to use a linear function. 4) Plea se comment on whether the concentration
- response function is used appropriatel y in the benefits assessment approach. The valuation of asthma effects from formaldeh yd e exposure is based on valuing the incidence of asthma rather than the more standard valuation based on the exacerbation of asthma sy mptoms. The reason for this is that a statistical relationship between formaldehyde exposure and asthma exacerbation has not been sufficiently well established, but there is a statistical relationship between form aldehyde exposure and asthma occurrence or incidence. However, the only time that EPA has valued asthma exacerbation is for the first prospective study of the benefits and costs of the Clean Air Act (EPA 1999). This is probably due to a lack of an appropri ate concentration
- response relationship. The EPA’s Office of Air does include recommended values for the monetization of chronic asthma in its BenMAP documentation (EPA 2011b), which is based on an average of the results from Blumenschein and Johannesson ( 1998) and O’Conor and Blomquist (1997). For this anal ys is, EPA treats prevalence as a measure of cumulative incidence by assuming that the disease duration is the rest of the child’s life. However, the EPA (2000a) has previously assumed that a portion of asthmatic children will become as ymptomatic as they move into adulthood. 5) Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context. The concentration
- response relationship is based on an odds rat io for a period of time longer than the one year. The exposure model produces results for one
- ye ar of exposure to formaldeh yd e for each age, housing ty

pe, and climate cohort. As a consequence, an adjustment to the simple model needed to be made to model th e effect on individuals who are currently alive when the regulation takes effect. As an upper bound estimate, we assume that the odds ratio can be applied to the one y ear reduction in the same fashion as it was applied for the 16 year time period. The pro blem with this approach is that it effectively treats the exposure as an acute effect. If the odds ratio indicates a particular percentage reduction in asthma cases from a reduction in formaldehyde exposure over7

16 years, the upper bound approach would sug gest the same percentage reduction in asthma case in one single ye ar if we were to witness the same reduction in formaldeh yde exposure in one ye ar. The lower bound approach assumes that a particular exposure reduction for one y ear produces the same effect as if that exposure reduction were spread out over the entire 16
- ye ar time period. 6) Please comment on the upper and lower bound methodology used. The prevalence data suggest that 7.2% of children age 0
- 4 have been told that they have asthma. 16.4% of chi ldren aged 5
- 14 have been told that they have asthma. We assume that the probability

of being diagnosed is uniformly distributed across the 0 to 16 age bracket, so that the incidence rate would be 1.44% for the first five years and 1.49% for the next eleve n years. Allocating cases uniformly across the age brackets provides us with a way to calculate the annual benefits of an y exposure reduction that occurs for the entire time period, but may not be appropriate if the diagnosis of asthma for very young children (e.g., age 0
- 2) differs from older children. 7) Is the assumption about applying the concentration
- response function to children aged 0 to 16 appropriate, given the asthma onset studies’ focus on school
- aged children and adolescents, and given the potent ial uncertainty of the Rumchev study

involving younger children? Female Reproductive Toxicity The linear concentration
- response function accounting for background exposures based on Taskinen et al. (1999) is used for the annual approach. 8) Please comment on whether the concentration
- response function is used appropriatel y in the benefits assessment approach. Monetization of delayed fertility has been discussed in the literature but has never been included in primary

anal ys es of EPA rules because it was be lieved that the scientific knowledge on reproductive and developmental health effects was not strong enough to quantify risk in the primary benefits anal ys is. While there appears to be good data on the cost of treatment, there are few studies on the willi ngness to pay

to reduce delayed conception. Most economic valuation studies regarding fertility focus on an individual’s or a couple’s willingness to pay for infertility

treatment, particularl y in
- vitro fertilization (IVF). Conceptually , the willingness t o pay approach is preferable and could be deduced from the valuation studies. However, given that there has been less research on this willingness to pay values than other values and the fact that the values have not been used in previous economic analy ses , we used the more straight
- forward cost of illness approach for this anal ys is. As an upper bound, we assume that any woman who has difficult y conceiving (i.e., time to pregnancy exceeds 12 months) will obtain some ty pe of fertility

service. This may be a reasonable upper bound, but there are certainl y women who have trouble becoming pregnant and do not seek fertility treatment.8

The willingness to pay

for fertility

treatment is treated as an expected value. The average cost of various cycle
- based fertility treatments is multiplied times the probability of obtaining that treatment at various ages. There is probably a small opposite effect associated with an increase in pregnancy

from reduced formaldehyde exposure by women who do not want to become pregnant, but we do not consider this effect 9) Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context. The time period associated with the exposure
- response function is longer than the time step of the e xposure model. The Taskinen (1999) study examined the fecundity

of women age 20
- 40. This causes a problem if we have an individual who does not experience the exposure reduction for the full time period. We can form an upper and lower bound of this willingness to pay as we did for asthma prevalence. The upper bound is based on the assumption that the linear concentration
- response function holds for an acute exposure of one ye ar. The lower bound assumes that an exposure reduction for one year represents 1/20 th of an exposure reduction for the entire 20
- ye ar time period. 10) Please comment on the upper and lower bound methodology used. The ages used in this analy sis reflect the ages reported in the Taskinen (1999) study , ages 20
- 40. However, women older than a ge 40 obtain fertility treatment. The value of reduced infertility effects from reduced formaldehyde exposure is not reflected in this analy sis in order to remain consistent with Taskinen (1999). 11) Please comment on whether the concentration
- response funct ion was applied to appropriate age groups given the age groups in the studies.9

**III. INDIVIDUAL REVIEWER COMMENTS**  **ON NON**  **- CANCER HEALTH**  **EFFECTS**

**– DERIVATION OF CONCENTRATION**  **- RESPONSE FUNCTIONS** 10 **R eview**  **By: John R. Balmes, M.D.** 11

**Peer Review Comments on EPA ’s Draft Document**  **Approach to Assessing Non -**  **cancer Health Effects from Formaldehyde and Benefits from Reducing Non**  **- cancer Health Effects as**  **a Results of Implementing Formaldehyde Emission Limits for Composite Wood Products John R. Balmes, M.D.**  University of California, San Francisco July 25, 2011 **I. GENERAL IMPRESSIONS**  The document is clearl y and concisel y written. The background subsections of Section 2: Non
cancer Health Effects

– D erivation of Concentration
- Response Functions for sensory irritati on (2.1.1), asthma (2.2.1), and female reproductive toxicity (2.3.1) are extremely

brief, especiall y the latter two. While it is understandable that the EPA does not wish to be duplicative of the material in the draft IRI S document on formaldehyde or the NAS review of the IRI S document, some readers of the “Approach” document will not have read the IRIS and NAS documents and thus will benefit from a bit more background context on formaldehyde and asthma or formaldeh yde and female reproductive toxicity
. **II . RESPONSE TO CHARGE QUESTIONS**  Sensory Irritation **The literature base of residential epidemiology studies of the irritation effects with quantitative concentration**  **- response data was limited, but data were available from which a concentration**  **** **response fu nction could be estimated for eye irritation.**  **1. Please comment on whether the concentration -**  **response function is appropriately derived from the studies used in the draft Approach Document.**  The concentration
- response function (CRF) for sensory irritation is derived from one small field study , Hanrahan et al. (1984). Because most individuals exposed to formaldehyde from the products of interest will be exposed at levels below 100 ppb, the EPA is appropriatel y concerned about the form of the CRF in this range. Unfortunately , the data for exposures below 100 ppb are not given in the original Hanrahan paper and the regression of prevalence of ey e irritation and formaldeh yd e concentration in the paper covers the range of 100
- 800 ppb. Another issue regarding CRF derivation from the Hanrahan paper is the relativel y small sample size (n=61). The L iu et al. (1991) study , which involved a much larger population, is supportive of the concept that there is a CRF for formaldeh yde and eye irritation at relatively low levels of exposure , but was not used in the actual derivation of such a CRF because of the way the authors aggregated their data into low, medium, and high levels of exposure. **2. Please comment on the validity of extrapolating the concentration -**  **respons e function and**  **using the function to estimate effects at concentrations below 100 ppb.** Given the limitations of the data available from the Hanrahan paper, the method of derivation of the CRF including the portion of the curve below 100 ppb is appropriate , but the extrapolation is12

pushing the envelope of what reasonabl y can be extracted from the data. The assumption that the reported standard deviation of the outdoor formaldehyde measurement s represents the lower bound on the standard deviation of the ind oor concentration s appears reasonable, but nonetheless the distribution of exposure data below 100 ppb in the Hanrahan study was assumed rather than based on the actual data. The EPA used the graphical display of the regression data over the range of 100
- 800 ppb in the Hanrahan paper to derive a CRF and then to infer the shape of the CRF below 100 ppb . Given that the Hanrahan study onl y included 61 subjects and that the formaldeh yde measurements in the mobile homes were onl y for 30
- 60 minutes, the validity of the extrapolated CRF can be questioned even if an appropriate method was used. **3. The studies considered for the concentration -**  **response function are residential studies because residential exposures are the focus of the rule and the residential stud**  **ies avoid some of the limitations of other types of studies (e.g., controlled exposure chamber studies used**  **high, acute exposures, and occupational studies reflect high exposure levels and potential dose** **- rate effects from peak exposures). Are there other**  **studies (e.g., chamber or non**   ** residential studies) that should be used as supporting evidence for the currently derived** **concentration -**  **response function for eye irritation? If so, please provide information about the studies and discuss how they should be**  **used to support the concentration -**  **response function.** I do not know of other studies that would be better to use for derivation of a CRF for formaldeh yde exposure and sensory irritation given the EPA’s interest in chronic, low
- level, non - peak exposures. **4 . Are there other sensory irritation endpoints besides eye irritation for which a concentration**  **** **response function can and should be developed for assessing effects at concentrations below 100 ppb? If so, please provide references of appropriate studies an**  **d a description of how the studies could be used to develop a concentration**  **- response function.**  I do not know whether a CRF can be developed for other sensory irritation endpoints. Asthma **Several studies of the association between formaldehyde and asth ma have been published and**  **these were quantitatively summarized in a meta -**  **analysis by McGwin et al. (2010). 5. Please comment on whether the McGwin et al. (2010) meta**  **- analysis is an appropriate**  **summary of the association between formaldehyde inhalation ex posures and childhood**  **asthma.** The McGwin et al. (2010) meta
- anal ys is of the association between formaldehyde exposure and risk of asthma in childhood appears to have been well conducted, using state
- of
- the
- art methods, including both fixed and random effe cts models and various sensitivity analy ses. Because the meta - anal ys is was based on a sy stematic review of the literature that appears to have been comprehensive, the results can be considered an appropriate summary of what is known about the association from epidemiological studies. **6. Please comment on whether EPA chose the appropriate function from the McGwin et al. paper to use in the benefits assessment.** 13

Exponentiating the linear slope of the fixed effects model from the McGwin et al
. paper is appro priate, especially

given that the random effects model gave essentiall y the same pooled odds ratio. Female Reproductive Toxicity **The literature base describing reproductive effects of formaldehyde exposure in humans is limited; however, there are support**  **ive findings from the animal toxicological literature. The epidemiologic literature suggests an association between formaldehyde and increased risk of**  **spontaneous abortion and a related delay in time to pregnancy (i.e., reduced fertility). The only study**  **with quantitative concentration -**  **response data was Taskinen et al. (1999). The**  **a priori hypothesis in Taskinen et al. (1999) was that formaldehyde would be associated**  **with decreased fertility. The primary analyses showed that there was a statistically si gnificant**  **reduction of fertility among the women in the highest exposure group that appeared to be concentration dependent. Post**  **- hoc subgroup analyses showed that stratification of the 39**  **women in the highest exposure group by reported glove use yielded e ffect estimates whose**  **confidence intervals overlappe d. The FDR for the 17 women who were classified as not**  **wearing gloves was 0.51 [95% CI: 0.28 −0.92]. The FDR for women who were classified as**  **always or sometimes wearing gloves was 0.79 [95% CI: 0.47 −1.23].**  **7. In light of the results regarding glove us e, in what way(s) can the Taskinen et al. results be**  **used to support calculating a concentration response for formaldehyde inhalation risk to time to pregnancy?**  The results of the stratified anal ys is regarding glove use are suggestive of the possibility that the dermal route may

contribute to total exposure, but are not adequate to consider modification of a CRF for decreased fertility based on inhalational exposures, especially given the small size of the two strata and the wide confidence intervals of th e FDR point estimates. **8. Please comment on whether the concentration -**  **response function is appropriately derived from the Taskinen et al. (1999) study.**  The CRF for formaldeh yde exposure and decreased fertility appears to be appropriatel y derived from the Taskinen et al. (1999) study . The adjustment for probable exposure to formaldeh yd e outside of the workplace is appropriate given the interest of the EPA in potentially controlling indoor exposures due to off
- gassing from certain products. The use of rea sonably contemporaneous background exposure data from Finland (Jurvelin et al., 2001) for this adjustment is also appropriate. **III. SPECIFIC OBSERVATIONS**  **Page 10, 1 st**  **full paragraph; page 14, figure 4a legend; page 15, 2 nd**  **full paragraph.** The use of “inhalation” exposure in the context of ey e irritation seems inappropriate. I would eliminate the use of “inhalation” in all three sentences. **Page 16, paragraph. 2.2.1.** Asthma is defined b y the Global Initiative for Asthma (GINA) as a14

disease characterized by

inflammation of the airway s, not lungs. I would eliminate “and lungs” in the first sentence of this paragraph. To avoid confusion, Iwould not use “sensitization” when discussing non
- allergic, neurogenic mechanisms of irritant chemical
- induced asthma in the third sentence. **Page 20, paragraph 2.3.1.** “Increased relative risk estimates (RRs) were in the range of 1.7 to more than 3.0.” To avoid confusion, I would cite the specific papers that reported these increased relative risks. **Page 22, last sente nce of text.**  The text here refers to “estimated concentration
- response functions” but does not explain why there is more than one CRF in Figure 6. It is not until page 24 that one learns that “Regression equations for linear and exponential fits are also provided.” If the two lines in Figures 6 and 7 are for both typ es of fits then this should be clearly indicated. **Page 26, last full sentence.** The use of a contraction here (“didn’t”) is unprofessional.15 **Review By:**  **David Kriebel, Sc.D.**16

**Peer Review Comme nts on EPA’s Draft Document**  **Approach to Assessing Non -**  **cancer Health Effects from Formaldehyde and Benefits from Reducing Non**  **- cancer Health Effects as**  **a Results of Implementing Formaldehyde Emission Limits for Composite Wood Products David Kriebel, Sc.D.**  University

of Massachusetts L owell July 2 1 , 2011 **I. GENERAL IMPRESSIONS**  The overall impression is of a thoughtful and well
- written document. The authors have provided a generally

clear and logical explanation of their reasoning throughout. There are a f ew exceptions, noted below, where additional explanation or documentation could improve the presentation. **II. RESPONSE TO CHARGE QUESTIONS** Sensory Irritation **The literature base of residential epidemiology studies of the irritation effects with quantit ative**  **concentration -**  **response data was limited, but data were available from which a concentration**   ** response function could be estimated for eye irritation.** **1. Please comment on whether the concentration -**  **response function is appropriately derived from the s**  **tudies used in the draft Approach Document.** I see no problems with the derivation of the concentration
- response function itself. In Section 2.1.3, Ithink it would strengthen the argument to at least acknowledge the problem of acclimatization. There is ev idence from a number of studies

– notably the studies of studies conducting autopsies

– that there is a change over weeks in the short
- term irritant effects. One way that this will impact the calculations is that cumulative exposure is probably not the app ropriate exposure metric. The authors may have little choice to use the simplified approach they have taken which assumes a constant exposure
- response relationship over time, but they could acknowledge that there is a source of uncertainty from the changes in potency of formaldeh yde over time for various endpoints. I suspect that the irritant effects diminish with time exposed, but the other two chosen endpoints probably do not. **2. Please comment on the validity of extrapolating the concentration -**  **respo nse function and**  **using the function to estimate effects at concentrations below 100 ppb.** I am comfortable with this extrapolation. However , I think that it would be appropriate to acknowledge that errors in exposure estimation in the studies on which the function is based have not been included in the uncertaint y calculations. This is a general concern

– for all 3 endpoints, there were certainly errors in the exposure estimation, and the impact of these on the uncertaint y in the exposure
- response function has not been considered.17

It might be noted that the extrapolation downwards assumes a logistic shape, which is reasonable but not subject to validation. It might be noted that the excellent R2 for Figure 3b is a bit misleading since it is fitting a curve to categorical data, while the actual individual exposure data were of course continuous

– the fit of this curve to the original data would not have been nearl y as good. And again, see my comment just above about failure to point out that the exposure data had error , which was not taken into consideration in the model error calculations. **3. The studies considered for the concentration -**  **response function are residential studies because residential exposures are the focus of the rule and the residential studi** **es avoid some of the limitations of other types of studies (e.g., controlled exposure chamber studies used**  **high, acute exposures, and occupational studies reflect high exposure levels and potential dose** **- rate effects from peak exposures). Are there other s**  **tudies (e.g., chamber or non**   ** residential studies) that should be used as supporting evidence for the currently derived** **concentration -**  **response function for eye irritation? If so, please provide information about the studies and discuss how they should be u**  **sed to support the concentration -**  **response function.** I think you should use the other studies

– particularly the chamber studies and the autops y studies

– to show the consistency of the findings across many settings. I am comfortable with the argument that the function should be derived from the residential studies. But Ithink that the logic of extrapolating downwards is supported b y some of the other studies. Kriebel et al
. Arch Env Hlth 2001; 56:11
- 18 contains fairl y detailed exposure data linked to eye irritation scores. While much of the data are above the range you are concerned with, there is evidence here that the relationship observed was valid across the full range of exposures. **4. Are there other sensory irritation endpoints besides eye irritati on for which a concentration**  **** **response function can and should be developed for assessing effects at concentrations below 100 ppb? If so, please provide references of appropriate studies and a description of how the**  **studies could be used to develop a conce ntration**  **- response function.**  Both nose and throat irritation can be linked to increased risk of lower respiratory tract infection including bronchitis. So you could argue that these would have greater economic impacts. Asthma **Several studies of the as sociation between formaldehyde and asthma have been published and**  **these were quantitatively summarized in a meta -**  **analysis by McGwin et al. (2010). 5. Please comment on whether the McGwin et al. (2010) meta**  **- analysis is an appropriate**  **summary of the associa tion between formaldehyde inhalation exposures and childhood**  **asthma.** I agree that it is appropriate. **6. Please comment on whether EPA chose the appropriate function from the McGwin et al. paper to use in the benefits assessment.**  I am comfortable with th e choice to exclude Rumchev, and agree with the derivation of the function as described.18

Female Reproductive Toxicity **The literature base describing reproductive effects of formaldehyde exposure in humans is limited; however, there are supportive finding**  **s from the animal toxicological literature. The epidemiologic literature suggests an association between formaldehyde and increased risk of**  **spontaneous abortion and a related delay in time to pregnancy (i.e., reduced fertility). The only study with quant** 

**itative concentration -**  **response data was Taskinen et al. (1999). The**  **a priori hypothesis in Taskinen et al. (1999) was that formaldehyde would be associated**  **with decreased fertility. The primary analyses showed that there was a statistically significant r** **eduction of fertility among the women in the highest exposure group that appeared to be concentration dependent. Post**  **- hoc subgroup analyses showed that stratification of the 39**  **women in the highest exposure group by reported glove use yielded effect estim ates whose**  **confidence intervals overlapped. The FDR for the 17 women who were classified as not wearing gloves was 0.51 [95% CI: 0.28**  **−0.92]. The FDR for women who were classified as always or sometimes wearing gloves was 0.79 [95% CI: 0.47**  **−1.23]. 7. I**  **n light of the results regarding glove use, in what way(s) can the Taskinen et al. results be used to support calculating a concentration response for formaldehyde inhalation risk to time**  **to pregnancy?** Yes, but you could strengthen your argument. First, there is a trend in both FDR and spontaneous abortion across levels of formaldeh yde, so you should not only focus on the effect modification by glove use in the high exposure group. While the high exposure is the only group for which the authors provided th e results stratified by glove use, the fact that there is a trend across air concentrations suggests that glove use

– not constant across exposure levels

– could not be a very important source of protection or you would not see the trend. Second, you have not correctl y dealt with the question of whether or not there is effect modification by glove use. The overlap of confidence intervals is not the correct way to do this. Construct the null hy pothesis that glove users and non
- users have the same FDR and the n calculate a p
- value testing this null. You can do it with the data provided

– back calculate the standard errors from the confidence intervals, or ask the authors for the standard errors. I am prett y sure that this p
- value will be large, and then yo u wil l be in a strong position to say that the appropriate conclusion is to act as if glove use has not modified the FDR. **8. Please comment on whether the concentration -**  **response function is appropriately derived from the Taskinen et al. (1999) study.**  Can’t you ask Taskinen to confirm your (and my) assumption that age was the conditioning time variable in their FDR calculations? The process of adjusting for background exposure is OK, but Idon’t think it strengthens the presentation. First, I doubt very much that the relevant background formaldehyde exposure for the women in this plant could have been so much higher than the levels inside the plant. My guess is that the mean (one mean for an entire country over a long period of time? How useful is that?) had a wide range around it. Second, an y of my graduate students could have told you that adding a constant to all the x values in a regression model will not change the slope.19

**III. SPECIFIC OBSERVATIONS**  **Page 20, s ection 2.3.1, 6**  **th and 7**  **th lines.**  The statement “Increased relative risk estimates (RRs) were in the range of 1.7 to more than 3.0” is not helpful

– without explaining whose risk is being compared to whose, the absolute value of an RR is not useful. **Section 2.0 Background on the Identification of No n**  **- Cancer Health Effects, last sentence.**  It would be helpful to summarize at least briefl y the logic behind focusing on these 3 endpoints. If I have understood the NAS comments correctl y, that Committee also raised questions about these choices, and in part icular on the decision not to use pulmonary function evidence. Given this concern from the NAS, Ithink a bit more explanation of the perceived inadequacies in the data for the other endpoints would strengthen this document.20 **Review By:**  **Frederick J. Mille r, Ph.D., Fellow ATS** 21

**Peer Review Comments on EPA’s Draft Document Approach to Assessing Non**  **- cancer**  **Health Effects from Formaldehyde and Benefits from Reducing Non -**  **cancer Health Effects as a Results of Implementing Formaldehyde Emission Limits for Composite**  **Wood Products Frederick J. Miller, Ph.D., Fellow ATS**  Fred J. Miller & Associates LLC July 18, 2011 **I. GENERAL IMPRESSIONS**  The comments provided are related to the health assessment and concentration
- response evaluation portion of the above cited document as this reviewer was not asked to comment on the economic benefits assessment approach. For the most part, the sections on sensory irritation, asthma, and female reproductive toxicity are clearly

presented and the material is developed in a logical manner. Some exceptions are noted in this reviewer’s responses to the specific charge questions. The decision on the concentration
- response functions to take forward to the economic benefits anal ys es is best documented for sensory irritation. This reviewer p rovides a suggestion for how far below 100 ppb of formaldeh yd e the modeling results developed by the Agency

based on the Hanrahan et al. (1984) study can be used. The material included in support of using the McGwin et al. (2010) meta anal ys is for asthma i n children does not adequately describe the short comings of the meta analysis. The uncertainties and conflicting results of the studies make this reviewer reticent to endorse the concentration
- response function for the odds ratio based on the McGwin et al . (2010) meta anal ys is. The case to use background adjusted exposure data for the female reproductive toxicity concentration
- response curve is adequatel y defended. However, the Agency does not indicate if the linear risk or the exponential risk curve will be used. Overall, the information presented is accurate. To their credit, in a number of places, the EPA authors have incorporated criticisms included in the NAS report of the Agency ’s draft IRIS assessment document. By addressing the responses to the charge questions, the Agency will be in a good position to move forward with the cost benefit anal ys is required by Executive Order 12866 related to the Formaldehyde Standards for Composite Wood Products Act. **II. RESPONSE TO CHARGE QUESTIONS** Sensory Irritat ion **The literature base of residential epidemiology studies of the irritation effects with quantitative concentration**  **- response data was limited, but data were available from which a concentration**  **** **response function could be estimated for eye irritation. 1**  **. Please comment on whether the concentration -**  **response function is appropriately derived from the studies used in the draft Approach Document.**  The draft Approach Document adequatel y discussed the type of data available in the literature from various studi es and presented their strengths and weaknesses. The Agency wisel y sta yed away from using the Liu et al. (1991) study as the primary

driver for the concentration
- response function for eye irritation. The categories from that study were formed on using a pp m - hr per22

week metric. The ey e irritation studies discussed in Section 2.1.2 for a 10 % additional risk for 560 ppb for 3 hours (i.e., 1,680 ppm
- hrs) compared to 240 ppb for 5 hours (i.e., 1,200 ppm
- hrs) clearl y show that Haber’s L aw does not appl y for the effects of formaldeh yde exposure on ey e irritation, which agrees with Miller et al. (Haber’s rule: a special case in a family of curves relating concentration and duration of exposure to a fixed level of response for a given endpoint. Toxicology

149:21

– 34, 2000). Thus, the Agency would have been hard pressed to defend a translation of the ppm
- hrs metric of Liu et al. (1991) as the basis for developing a concentration
response function for ey e irritation. Rather, the Hanrahan et al. (1984) study that report ed eye irritation was associated with in
- home formaldeh yde exposures ( p < 0.05) (both as “burning ey es” and “ey e irritation”) was used as the data for developing a concentration
- response relationship for eye irritation. Moreover, the logistic regression mo del developed b y Hanrahan et al. (1984) gave insight as to the needed nature of the curve if one were to extrapolate below the range of exposures reported by those authors (i.e., from 100 to 800 ppb). In the opinion of this reviewer, the concentration
- resp onse function was appropriately derived by

the Agency
. **2. Please comment on the validity of extrapolating the concentration -**  **response function and using the function to estimate effects at concentrations below 100 ppb.**  The Agency

appropriately

focused o n the data from the Hanrahan et al. (1984) study to develop the concentration
- response curve for eye irritation. Importantly , the Agency used a power law curve to fit the prevalence odds data. This ensures that the fitted curve will asy mptoticall y approach zero for a zero formaldehyde exposure level and makes it reasonable to use Equation 2.2 below 100 ppb. Given (1) the limit of detection (LOD) was 10 ppb at the time the Hanrahan et al. (1984) study was conducted, (2) the Agency’s assumption about the outd oor standard deviation of measurements being 30 ppb around a log
- normal distribution of measurements, and (3) the known overall shape of the concentration
- response curve below 100 ppb, this reviewer believes it would be reasonable for the Agency to use the fitted equation down to a level of about 40 ppb, which would correspond to the LOD plus one standard deviation. **3. The studies considered for the concentration -**  **response function are residential studies because residential exposures are the focus of the r** **ule and the residential studies avoid some of the limitations of other types of studies (e.g., controlled exposure chamber studies used**  **high, acute exposures, and occupational studies reflect high exposure levels and potential dose** **- rate effects from peak e**  **xposures). Are there other studies (e.g., chamber or non**   ** residential studies) that should be used as supporting evidence for the currently derived** **concentration -**  **response function for eye irritation? If so, please provide information about the studies and**  **discuss how they should be used to support the concentration -**  **response function.** Be yond the studies considered b y EPA, this reviewer knows of no chamber or epidemiology studies that would be useful in developing the concentration
- response function for ey e irritation. Given the definition of an inhalation RfC and the focus on extended periods of exposure, the residential studies were conducted in a manner that best fits the criteria for developing an RfC and using it in the benefits analy ses that the Agency is being required to conduct. **4. Are there other sensory irritation endpoints besides eye irritation for which a concentration**   ** response function can and should be developed for assessing effects at concentrations below**23

**100 ppb? If so, please provide refe rences of appropriate studies and a description of how the**  **studies could be used to develop a concentration -**  **response function.** Sensory irritation may

be indirectly

reflected in pulmonary

function responses measured after exposure to formaldeh yd e. However, these studies were not conducted at levels that would be relevant to what the Agency is being charged with investigating. Asthma **Several studies of the association between formaldehyde and asthma have been published and these were quantitatively summari**  **zed in a meta -**  **analysis by McGwin et al. (2010). 5. Please comment on whether the McGwin et al. (2010) meta**  **- analysis is an appropriate**  **summary of the association between formaldehyde inhalation exposures and childhood asthma.**  There are man y problems with the studies used in the meta anal ys is conducted by McGwin et al. (2010). Relative to the description of the metal analy sis, the Agency d id a reasonable job of pointing out many

o f the strengths and weakness that McGwin and colleagues noted in their paper, but this description could be improved. There are various inconsistencies in the studies selected for the meta analy sis that would make this reviewer reticent to put much trust in the findings for applicability t o the U.S. population. First, only

o ne stu dy

w as conducted in the U. S. and that study d id not find a statistically significant odds ratio (OR) with exposures being in the range of 30 to 80 μg/m 3 of formaldeh yde. Moreover, the sample size of the U.S. study w as greater than that of 5 of the other s tudies contained in Table 1 of McGwin et al. (2010). A Swedish study

w ith exposures no greater than 10 μg/m 3 had an OR more than twice that of any other study

even though several of those studies involved formaldehyde exposures in the 5 to 70 μg/m 3 range, including another Swedish study
. The Zhao et al. (2008) study r esults are inconceivable to this reviewer for inclusion in a reliable meta analy sis. With school exposures (1 to 5 μg/m 3 ) and outdoor exposures (5 to 7 μg/m 3 ), mean OR estimates were found to represent decreased risk, yet the upper bound of the 95 % confidence interval was 17 for the school OR and more than 2.3 million for the outdoor OR for the same set of 1,993 children having a mean age of 12.8 ye ars. McGowan et al. (2010) state that to ev aluate whether the results they f ound were undul y influenced by

any i ndividual study

and to determine if there was an y publication bias, an influence plot and a funnel plot, respectively w ere used. However, they d id not present these plots in their paper. The computed values of the Q and I 2 statistics were stated to support the presence of moderate between
- study h eterogeneity
. The EPA document cites values for these statistics but does not explain how they are calculated, but should do so. Q (better known a s Cochran’s Q) is a classical measure of heterogeneity and is calculated as the weighted sum of squared differences between individual study e ffects and the pooled effect across studies, with the weights being those used in the pooling method. Q is distrib uted as a chi
- square statistic with k (number of studies) minus 1 degrees of freedom (d.f.). The I2 statistic describes the percentage24

of variation across studies that is due to heterogeneity rather than chance and is computed as 100* (Q

– d.f.)/Q. On pag e 18 of the EPA document, the overall OR for a fixed effects model is given as 1.026 but on page 20 the same result is stated as an OR of 1.03. The Agency n eeds to be consistent. If the data are onl y sufficient to give an OR with 2 digits after the decimal point, say so and change the value on page 18 and vice versa. For the reader to better judge the reasonableness of the meta anal ys is results, the EPA document should include Table 1 of the McGwin et al. (2010) paper in addition to Figure 1 from that paper
. **6. Please comment on whether EPA chose the appropriate function from the McGwin et al. paper to use in the benefits assessment.**  The EPA document does not specifically s tate which model result (i.e. fixed effects or random effects) was selected. Rather they s tate that the mean OR was 1.24 per 10 ug formaldeh yd e per m 3 for both models. One only determines that the Agency c hose to use the random effects model if one calculates the transformed 95 % confidence interval for an OR for an increase of 1 ppb and sees that what is stated on page 18 corresponds to the confidence interval for the random effects model. The lack of significant between
- study heterogeneity

in the meta anal ys is of McGwin et al. (2010) supports using a fixed effects model; however, the e xtent of the uncertainties among the studies and the fact that the random effects confidence interval will alway s be larger than the fixed effects confidence interval supports the conservative selection by the Agency

t o use the random effects model results
. Inv iew of the additional problems this reviewer discussed earlier concerning the choice of studies for inclusion in the meta anal ys is, this reviewer would be reticent to have the benefits assessment use only

o ne function (i.e., the OR of 1.03 per one p pb increase in formaldehyde exposure with a 95 % confidence interval from 1.008 to 1.047). The single U.S. study s hould also be evaluated wherein the OR is 1.0083 per 1 ppb increase in formaldehyde exposure with a 95 % confidence interval of 0.97 to 1.045. Female Reproductive Toxicity **The literature base describing reproductive effects of formaldehyde exposure in humans is limited; however, there are supportive findings from the animal toxicological literature. The**  **epidemiologic literature suggests an association between formaldehyde and increased risk of**  **spontaneous abortion and a related delay in time to pregnancy (i.e., reduced fertility). The only study with quantitative concentration**  **- response data was Taskinen et al. (1999).**  **The a priori**  **hypothes is in Taskinen et al. (1999) was that formaldehyde would be associated**  **with decreased fertility. The primary analyses showed that there was a statistically significant reduction of fertility among the women in the highest exposure group that appeared to b**  **e concentration dependent. Post**  **- hoc subgroup analyses showed that stratification of the 39**  **women in the highest exposure group by reported glove use yielded effect estimates whose confidence intervals overlapped. The FDR for the 17 women who were classif**  **ied as not**25

**wearing gloves was 0.51 [95% CI: 0.28 −0.92]. The FDR for women who were classified as**  **always or sometimes wearing gloves was 0.79 [95% CI: 0.47 −1.23].**  **7. In light of the results regarding glove use, in what way(s) can the Taskinen et al. res ults be**  **used to support calculating a concentration response for formaldehyde inhalation risk to time to pregnancy?**  The results after stratifying for glove use are indirectly supportive for an inhalation effect of formaldeh yde on the fecundity density rat io (FDR). Those women who did not wear gloves had a statistically

significantly

decreased FDR of 0.51 (i.e., 95 % confidence interval did not include 1). Women classified as alway s or sometimes wearing gloves had a FDR closer to 1 and their confidence inte rval included 1. Thus, the inclusion of women wearing gloves would tend to move the overall FDR closer to 1, where FDR values lower than 1 can be interpreted as an adverse effect in that the time to achieve conception is delayed. This was indeed the case s ince a FDR of 0.64 was found for all women in the highest exposure group. This provides evidence in support of the h ypothesis that effects on FDR were most likely due to inhalation exposure rather than to dermal exposure to formaldeh yde. **8. Please comment on whether the concentration**  **- response function is appropriately derived**  **from the Taskinen et al. (1999) study.** A concentration
- response function can be derived from the Taskinen et al. (1999) study , and the selected function must be one for which there w as an adjustment for background exposure levels; however, the EPA document does not actuall y state whether they w ill use the linear function of risk or the exponential function of risk equations that are discussed in the document (i.e. will the Agency use Eq. 2
- 5 or 2
- 6? ). The two curves presented in Figures 6 and 7 of the Agency d ocument are not explained either in the figure legend or in the text. While they o bviously

r elate to the regression of risk on formaldeh yde concentration, their difference is not explained. The Agency clearl y picked up on most of the criticisms provided by the NAS review of the draft IR IS document related to the Taskinen et al. (1999) study
. However, the Agency ’s section on the discussion of uncertainties does not comment at all o n the clear possibility o f confounding due to xylene exposures in the Finnish worker study
. Also, there is no discussion of the possible magnitude or direction of an y exposure misclassification bias in the Taskinen et al. (1999) study
. If the Agency i s goi ng to use the Taskinen et al. (1999) study i n their economic anal ys is, more attention to a description and discussion of the study ’s strengths and weaknesses is needed.26

**III. SPECIFIC OBSERVATIONS**  None.27 **R eview**  **By: Rebecca T. Parkin, Ph.D., MPH** 28

**Peer R eview Comments on EPA’s Draft Document**  **Approach to Assessing Non -**  **cancer Health Effects from Formaldehyde and Benefits from Reducing Non**  **- cancer Health Effects as**  **a Results of Implementing Formaldehyde Emission Limits for Composite Wood Products Rebecca**  **T. Pa**  **rkin, Ph.D. , MPH**  The George Washington University Medical Center July 13 , 2011 **I. GENERAL IMPRESSIONS**  The draft is clearl y organized and, in large part, well
- written. Minor inaccuracies are noted below. Most sections were clear, although some key issues were not mentioned or are not clear; these concerns are noted below. Except in a few instances as noted below, the conclusions are effectivel y supported b y the text provided. Uncertainties are important to discuss. EPA has captured man y of the important ones, but may need to add more to these sections based on this and other reviewers’ comments. Being thorough in all uncertainty sections is crucial to the foundations of the benefit assessments. **II. RESPONSE TO CHARGE QUESTIONS** Sensory Irritati on **The literature base of residential epidemiology studies of the irritation effects with quantitative concentration**  **- response data was limited, but data were available from which a concentration**  **** **response function could be estimated for eye irritation. 1.**  **Please comment on whether the concentration -**  **response function is appropriately derived from the studies used in the draft Approach Document.**  First, I will comment on each study and then on the derivation process. **Liu et al (1991):** This paper adequatel y describes how homes were randomly selected, but omits some key information related to monitoring results for the homes included. The study was conducted throughout California (p. 93); a very large state with a wide range of climatic conditions. “Summer” and “winter” sampling periods were used, but these seasons are quite different in different parts of the state. It is well
- known that temperature and relative humidity affect formaldeh yde (HCHO) levels, but there is no mention of how these factors varied in the study homes or how they may

have affected measured HCHO levels. Further, the Quality Assurance/Quality

Control methods are not described, and the number of laboratories used to anal yz e the passive area monitoring samples is not stated. These omiss ions leave this reviewer without key

information to assess the accuracy or validity

of the HCHO levels reported. Residents received instructions on how to uncap, place and mail back the samplers. The use of the kitchen and master bedroom as monitoring sites may be most relevant for the homeowner and less relevant for other occupants. Although averaging the monitored levels for each home29

may have lost some useful variation, it is not likely that in fairly

small homes (such as mobile homes) that this los s
– except for peak exposures

– would be particularly important. The study appropriately

controls the impact of smoking indoors, and does not discuss gas cooking stoves or appliances, opening of windows and doors, or other factors that have been reporte d by

other authors as having non
- significant impacts on HCHO levels. More importantly , if I am reading the article correctly (p. 92), some indoor samples in this cross
sectional study

were taken after s ymptoms were recorded. This conflicts with determi ning the appropriate temporal sequence of cause preceding effect. I believe my reading is different from what EPA states on p. 10 of their draft, which indicates that exposures were recorded in a period preceding the documentation of sy mptoms. **Hanrahan e t al (1984):**  This cross
- sectional study , conducted in Wisconsin during July 1979, sampled a smaller number of mobile homes (65) than did L iu et al.; it also had a lower percentage of participants among those contacted (31% vs. 44%). In this study , person al samplers were used and 33 outdoor samples were taken (at least 1 in each mobile home park). The authors noted that prior to and during sampling periods home windows were closed, gas appliances were turned off and smoking was prohibited. The Quality Control and specific laboratory methods were noted (unlike in Liu et al). The indoor samples for each home were averaged, as in L iu et al, with similar but less specific sampling locations noted. It is not clear whether the residents or the researchers c ollected the air samples in this study
. Smoking was appropriately considered, and indoor and outdoor temperature and humidity , and appliance and construction characteristics were noted. Some but not all of these factors’ influences on HCHO levels were presented in the article. **Derivation:** The seasonal and cumulative averages and ranges of indoor levels, the concentration
- response data are correctl y extracted from the **Liu et al.** article. The method to estimate the average number of hours indoors seems appropriate; however, this reviewer wonders whether EPA attempted to determine whether the authors still have the raw data that could be used for a more accurate assessment of hours spent indoors. EPA had to make man y more adjustments when using the **Hanr ahan et al.**  article. First, EPA estimated the lower bound for the indoor levels based on the standard deviation for the outdoor levels; this is a reasonable approach given the missing data for the indoor levels. Second, the Agency assumed that the distri bution of indoor levels is log
- normal in order to estimate the number of samples with HCHO levels below 100 and 50 ppb. However, if this assumption or the estimated standard deviation is not correct, the numbers of samples could be quite different. It is not clear in Figure 2 whether the data shown are for EPA’s or the authors’ use of “ey e irritation;” e.g., does “eye irritation” here mean the “burning eyes” AND “ey e irritation” results in the article? If combined data were used, did EPA assume that al l of these sy mptoms were distinct and not co
- occurring events? Are we looking at data for the number of s ymptoms reported or the number of people with ey e s ymptoms (meaning “burning eyes” and “eye irritation”) at each level of exposure? This question sho uld also be asked of the data shown in30

the draft Table 1. Without knowing whether EPA combined data in Figure 2 and Table 1, it is difficult to comment further on this part of the draft. The conversion of data in the article to prevalence odds seems appropriate. The display of estimates below 150 ppb in Figure 4b are derived from Equation 2
- 2 and are likely correct. This reviewer did not verify

the mathematics. The EPA authors have noted many key uncertainties in the two studies and how these affect their estimates of the relational function. However, the validity of the HCHO monitored levels remains a question, due to missing information in the articles; exposure misclassification is possible in both studies but is not discussed in the draft. **2. Please comment on the validity of extrapolating the concentration**  **- response function and**  **using the function to estimate effects at concentrations below 100 ppb.** The validity

of the extrapolation in the Hanrahan et al. paper depends in part on what data we re used for the outcome measure. If “burning eye” AND “ey e irritation” data were combined, more information is needed in the draft to describe what assumptions were made in the combining process. (See comments above.) The validity

of the estimates below 100 ppb based on the Hanrahan et al. data is strengthened by their alignment with the results in the L iu et al. study
. However, clearer discussion of the Agency ’s choice of and uncertainties in the points of departure would improve this portion of the dr aft. **3. The studies considered for the concentration -**  **response function are residential studies because residential exposures are the focus of the rule and the residential studies avoid some**  **of the limitations of other types of studies (e.g., controlled e xposure chamber studies used**  **high, acute exposures, and occupational studies reflect high exposure levels and potential dose** **- rate effects from peak exposures). Are there other studies (e.g., chamber or non**  **** **residential studies) that should be used as suppo rting evidence for the currently derived**  **concentration -**  **response function for eye irritation? If so, please provide information about the studies and discuss how they should be used to support the concentration**  **- response function.**  I am not aware of an y oth er studies that should be considered for this function. **4. Are there other sensory irritation endpoints besides eye irritation for which a concentration**   ** response function can and should be developed for assessing effects at concentrations below** **100 ppb? If so, please provide references of appropriate studies and a description of how the**  **studies could be used to develop a concentration -**  **response function.** I agree with EPA and NAS that ey e irritation is the most sensitive sensory irritation endpoint and the refore is the most appropriate endpoint to use. Asthma **Several studies of the association between formaldehyde and asthma have been published and these were quantitatively summarized in a meta**  **- analysis by McGwin et al. (2010).** 31

**5. Please comment on wheth er the McGwin et al. (2010) meta**  **- analysis is an appropriate**  **summary of the association between formaldehyde inhalation exposures and childhood asthma.**  The authors clearl y built on well
- accepted guidelines for s ys tematic meta
- analy sis (Stroup et al., 2000) . The stud y selection/exclusion criteria and process used b y M cGwin et al. is well
documented in their article. The variables extracted and utilized are stated. The determination to use a consistent metric (odds ratio per 10 μg/m 3 with the related 95% c onfidence interval) across the 7 studies for which actual HCHO measurements were available is appropriate. The methods used to pool the odds ratios and test for heterogeneity are standard analy

tic approaches. Their evaluation of the potentially undue inf

luence of any

one study , using influence and funnel plots, adds strength to their analy sis. The results are shown with and without Rumchev et al., allowing the reader to judge whether this paper should have been included or not. The data in Table 2 indic ate that the magnitude of the HCHO effect on asthma prevalence is significant whether this study is included or not. The presentation of the Q and I 2 statistics guides the reader to the key results for interpreting the data in this table. In summary , thi s reviewer finds that the McGwin et al. meta
- analy sis is an appropriate summary and sy nthesis of the eligible studies reporting a quantitative relationship between HCHO and prevalence of childhood asthma. **6. Please comment on whether EPA chose the appropr iate function from the McGwin et al.**  **paper to use in the benefits assessment.** The Agency

has chosen the appropriate function from the McGwin et al. paper. With the exception of the discussion of the rationale for excluding Rumchev et al., however, more i nsightful comments about the strengths of the meta
- anal ys is would lend greater support to the Agency ’s use of and reliance on the fixed
- effects model’s OR=1.24. Deepening the discussion would improve the support for the Agency ’s conclusions and recommendation. For example, McGwin et al. stated that an I2 value of <50% would point to relying on the fixed
- effect results (p. 314). Although the Agency uses the fixed
- effect modeling results, correctly stating that the Q and I2 data indicate low heterogeneity , the draft does not include the key cut - point (I2 <50%) for the use of fixed
- vs. random
- effect modeling results. In this reviewer’s opinion, pointing the reader explicitly

to this cut
- point and the relevant data in McGwin et al.’s Table 2 would sharpen the Agency ’s rationale for choosing the fixed
- effect results The discussion of uncertainties in this section includes the key issues (such as the changes in definition and determination of “asthma” over time) and is appropriatel y written. Female Reproduct ive Toxicity **The literature base describing reproductive effects of formaldehyde exposure in humans is limited; however, there are supportive findings from the animal toxicological literature. The**  **epidemiologic literature suggests an association between formaldehyde and increased risk of**  **spontaneous abortion and a related delay in time to pregnancy (i.e., reduced fertility). The only study with quantitative concentration**  **- response data was Taskinen et al. (1999).**  **The a priori**  **hypothesis in Taskinen et al . (1999) was that formaldehyde would be associated**  **with decreased fertility. The primary analyses showed that there was a statistically significant**32

**reduction of fertility among the women in the highest exposure group that appeared to be concentration depe** **ndent. Post -** **hoc subgroup analyses showed that stratification of the 39 women in the highest exposure group by reported glove use yielded effect estimates whose**  **confidence intervals overlapped. The FDR for the 17 women who were classified as not wearing g** 

**loves wa s 0.51 [95% CI: 0.28**  **−0.92]. The FDR for women who were classified as always or sometimes wearing gloves was 0.79 [95% CI: 0.47**  **−1.23]. 7. In light of the results regarding glove use, in what way(s) can the Taskinen et al. results be**  **used to support calc ulating a concentration response for formaldehyde inhalation risk to time**  **to pregnancy?** The article (p. 208) is not clear as to whether the post
- hoc anal ys is was adjusted for the variables noted in the footnote of Table VI; if not, the post
- hoc results wo uld not be directly comparable to the data presented there. That said, the reported post
- hoc high exposure group glove/not odds ratios and confidence intervals expand and are consistent with the trend shown in Table VI. However, all of the confidence int ervals overlap each other, yi elding a set of non
- significant odds ratios. If the adjusted post
- hoc odds ratios are available, it would be interesting to see the results of a test for trends comparing high exposure
- gloves not used, high exposure
- gloves use d, medium exposure, and low exposure. The trend probably is not significant, but testing its significance may

offer more information for interpreting the concentration
- response relationship. **8. Please comment on whether the concentration -**  **response functio n is appropriately derived**  **from the Taskinen et al. (1999) study.** Exposure measurements were available onl y for the middle of the study period, but the authors were able to verify

“most” women’s self

- reported exposure levels based on data from their workp laces. The article does not state whether this verification was completed to the same extent across the entire study period. This reviewer also wonders whether for some women (outside of the undefined “most”) the authors assumed that self
- reported HCHO e xposure levels were accurate and did not change during the study period. The Agency draft notes general exposure measurement concerns and agrees with Taskinen et al. regarding their modest response rate to the mailed questionnaire. Although Taskinen e t al. note that reporting biases may be present in their study , they did not report an y evaluation of their data to address that concern. For example, the response rates for women with pregnancies in the 1985
- 90 vs. 1991
- 95 periods were quite different. Although the authors note that “ onl y a few women could not report the length of time to pregnancy,” they do not indicate whether more women in the earlier vs. later period were non
- reporters. Also, there is no mention to what extent the authors believe th e recall of the number of months
- to - pregnancy was accurately

recalled by

either group of women. Neither Taskinen et al. nor EPA adequately discuss whether self

- reported time
- to - pregnancy (or spontaneous abortion) data are reliable for use as an outcome me asure. If outcome misclassification is an issue as well as exposure misclassification, the odds ratios could be further compromised toward the null. Discussion of the reliability

of self
- reported outcome data should be considered for the next draft. The Agency ’s adjustment for non
- occupational HCHO exposures, based on contemporaneous data, shifts the relationship to the right (from Figure 6 to Figure 7) but does not consider the variation in exposure levels found by Jurvelin et al. The draft assumes that all of the women in33

the study had the same non
- occupational HCHO exposures. Considering the range, not just the mean, of Jurvelin et al.’s measurements would be more informative and would allow for the identification of upper and lower bounds on the con centration
- response relationship. **III. SPECIFIC OBSERVATIONS**  Eye Irritation **Page 10, last paragraph, line 4 and Figure 2, line 2.** The EPA draft states that these samples were taken from 30
- 60 minutes, but the authors only mention pumps running “for approximately one hour” (p. 1026). Does EPA have information in addition to what is in the article or is the 30
- minutes an error? **Pages 11 -**  **12.** Figure 2 in the draft has a more detailed caption , but otherwise seems to be exactl y the same as the one in the Hanrahan et al. paper (which is data for “burning ey es”); is it the same as in the paper? I f so, shouldn’t it clearl y indicate that it is “burning eye” data? **Page 12.** Table 1 may

need a clearer caption indicating whether the data shown are for “burning eyes” AND “ey e irritation” or “eye irritation” alone. Wherever combined data are used, EPA should clarify

this usage and possibly

create a new name for combined eye sy mptom data. Further, the title of Table 1 would be more accurate if it included “...extracted and calculated from...” Asthma **Page 16, last paragraph, last 2 lines and top of page 1.** The descriptive language in the Agency draft about using the McGwin et al.’s I 2 statistic would be stronger if made more specific; e.g., noting that McGw in et al. used a cut
- point of <50% for choosing fixed
- vs. random
- effects data (page 314, top of middle column). It appears that EPA agreed with this cut
point. **Page 18, first complete paragraph, line 6.** The Agency states that the I2 statistic is 11.2 when the Rumchev et al. paper is excluded, but Table 2 in McGwin et al. shows 11.3. Female Reproductive Toxicity **Page 22.** The title on Table 2 should state which “response” (TTP) is presented.34 **IV .**  **INDIVIDUAL REVIEWER COMMENTS ON**  **THE BENEFITS ASSESSMEN T APPROACH** 35 **Review By:**  G **lenn C. Blomquist, Ph.D.**36

**Peer Review Comments on EPA’s Draft Document Approach to Assessing Non**  **- cancer**  **Health Effects from Formaldehyde and Benefits from Reducing Non -**  **cancer Health Effects as a Results of Implementing Formaldehyde**  **Emission Limits for Composite Wood Products G** **lenn C.**  **Blomquist, Ph.D.** University

of Kentucky July 19, 2011 **I. GENERAL IMPRESSIONS**  Overall, the draft Approach Document is well
- written. Refreshingl y, Standard English language is used extensively

and t echnical terms introduced when necessary . Examples to explain terms such as odds ratios should make the document understandable to educated lay readers with varied backgrounds. The key concentration
- response functions are clearl y presented in the form of equations and graphs or tables. This draft is readable. Information presented appears to be accurate and representative of studies that are the source of the information. Brief descriptions of key studies are given in addition to the findings relevant to the topic of this draft Approach Document. The extensive list of references allows the reader to learn more about the studies from which crucial estimates are taken. Conclusions regarding concentration
- response functions and valuation (monetization) a s reflected in their use in the examples follow from the information and models presented in a logical and reasonable way . M y assessment of presentation applies to the entire document. My assessment of accuracy

and soundness applies mostly to Section 3 B enefits Assessment Approach because of m y background in environmental and health economics. **II. RESPONSE TO CHARGE QUESTIONS** Sensory Irritation **The concentration -**  **response function for the prevalence of eye irritation is based on Hanrahan et al. (1984).**  **While Hanrahan does not identify the relevant time period for this relationship, Liu et al. (1991) produced qualitatively similar results for a two**  **- week time period.**  **We assumed that the concentration -**  **response relationship for eye irritation is for a two -**  **w eek**  **period and multiplied the concentration -**  **response function times 26 to obtain the number of cases of eye irritation experienced in one year.**  **The concentration -**  **response curve used is non -** **linear, which means that the annual approach may not produce an e** 

**xact measure of the benefits, but it is believed that the bias is probably relatively small given the small change in exposure.**  **1. Please comment on whether the concentration -**  **response function is used appropriately in the benefits assessment approach.**  Th e change in exposure expected from the policy appears to be small relative to ty pical exposure. It follows that the linear approximation implied by multiplication by

26 to obtain annual changes in number of cases of ey e irritation should produce onl y a sm all bias. It seems as reasonable as other approaches.37

**The concentration -**  **response curve is for an acute effect occurring at a time less than the one****** **year time step of the exposure model. The willingness to pay to avoid cases of eye irritation is calculate** **d for each year of analysis by multiplying the number of cases in a year by the marginal willingness to pay value to avoid one case. This may produce biased results, but the**  **direction of that bias is unknown. On one hand, s**  **ome studies have suggested that the willingness to pay per symptom**  **- day declines**  **as the number of symptom -**  **days avoided increases. In other words, the value to reduce two symptom**  **- days of some effect is less than two times the value for one symptom**  **- day. Therefore,**  **this approach may overstat e the total value.**  **On the other hand, this analysis only applies values to one symptom, eye irritation, largely because this is the only symptom for which an effective concentration**  **- response curve was**  **derived. However, there is evidence that there are ot her forms of minor eye, nose, and throat**  **irritation associated with formaldehyde exposure. Since eye irritation is the largest of the median values from the Tolley et al. (1986) study, the values used here likely represent a lower**  **bound on the true effect of multiple symptoms. A reasonable upper bound of the total effect**  **for one symptom -**  **day would be sum of the willingness to pay for one symptom -**  **day of each effect individually.**  **2. Please comment on whether the annualized approach as opposed to the lifetim e approach is**  **appropriate in this context.** I admit to being confused by the statement that eye irritation has the largest of the median values in the Tolley

et al. (1986) study . (For full disclosure, I am one of et al.) Much of that study was published in Tolley , Kenkel, and Fabian Valuing Health for Policy (1994) particularl y in Chapter 4 by Kenkel, Berger, and me. In Table 4.3A on page 88, the median values for willingness to pay to avoid an additional sy mptom day

are $11 for coughing, $12.50 for ey e irritation, $13 for throat irritation, and $14 for sinus congestion. All three are similar, but eye irritation is not the largest. It will not make much difference, however, if either of the other two is used instead of $12.50 for ey e irritation. Comparing results reported in Table 4.3A and Table 4.3B suggests that willingness to pay per sy mptom - day

declines as the number of s ymptom day s avoided increases. For example, the median value for avoiding 30 s ymptom - day s of eye irritation is $100 which is less than 30 times $12.50 (or $375). This suggests that multiplying the $12.50 times the number of day s of ey e irritation avoided will bias the annual estimate for avoiding ey e irritation upwards if there are multiple day s for individuals. Declining marginal willingness to pay for avoided illnesses is also found in the recent study , Bosworth, Ryan, Trud y Ann Cameron, and J.R. DeShazo. “Demand for Environmental Policies to Improve Health: Evaluating Community
- Level Policy Scenarios” Journ al of Environmental Economics and Management 57 (2009): 293
- 308. Table 4 also shows willingness to pay values for avoiding combinations of sy mptoms in a day
. The willingness to pay

values for avoiding combinations of sy mptoms in a day

are less than the s ums of the willingness to pay values for avoiding the sy mptoms separatel y. The declining marginal value of adding another light s ymptom suggest that a reasonable upper bound of the38

annual value of the total effect for one sy mptom - day

would be the sum of the willingness to pay for one s ymptom - day

of each effect individually
. On page 34, the paragraph that begins with Tolley et al. (1986) is mostly correct. (I am a coauthor on that Tolley

report and the Berger et al. (1987) article.) It is correct, as stated, that the mean willingness to pay to relieve one s ymptom - day of a light sy

mptom was $25

- $50. It is mostly correct, as stated, that Berger et al. report higher willingness to pay values for these same sy mptoms. The difference is due to different samples. The Tolley et al. values are based on a sample of 176 respondents, some of whom had experienced the s ymptoms and some of whom had not. The Berger et al. values are based on a subsample of 119 who actually had experienced a sy mptom. The mean values for the subsample that had experienced the sy mptoms are greater than for the full sample for five of the seven light sy mptoms, nearl y the same for one, and less for the remaining one. The mean value for ey e irritation was $48.48 for the 16 who reported e ye irritation whereas the mean value was $27.73 for all 176 who responded. The values reported are in 1984 dollars in both the Tolley et al. report and the Berger et al. article. The median value for eye irritation of $12.50 that Weitzel (1990) found is also reported in Tolley , Kenkel, and Fabian Valuing Health for Policy (1994) in Table 4.3 on page 88. It is correct that it too is in 1984 dollars. On page 36, if the BLS Inflation Calculator is used to inflate the median value of $12.50 for eye irritat ion from 1984 dollars to 1999 dollars, the value is $20.03 as shown in Table J

- 10. I f the same is done for 1984 to 2006, the value is $24.25, which rounds to $24, as reported below Table J
- 10. Two recent studies find that different lifetime risk profiles are valued differently ; see Nielsen, Jy tte Seested, Susan Chilton, Michael Jones
- Le e, and Hugh Metcalf. “How Would You L ike Your Gain in Life Expectancy to Be Provided? An Experimental Approach” Journal of Risk and Uncertainty 41 (D ecember 2010): 195
- 218 and Cameron, T.A., J.R. DeShazo, and P. Stiffler. “Demand for Health Risk Reductions: A Cross
- national Comparison between the U.S. and Canada” Journal of Risk and Uncertainty 41 (December 2010): 245
- 273. Given the limited informatio n on the sy

mptoms of interest it is not clear how incorporate these finding into the Approach Document
. **The concentration -**  **response function for the prevalence of eye irritation is for a single two**   ** week period. The annualized approach used an adjusted con** **centration -**  **response relationship that consisted in multiplying the concentration**  **- response function obtained from Hanrahan et**  **al. (1984) by 26 two -**  **week periods. 3. Please comment on whether the adjustment of the concentration**  **- response function is**  **appropria te in the annualized approach.**  It seems as reasonable as other possible approaches. Asthma **The concentration -**  **response relationship for asthma incidence is given as an odds ratio for children exposed to formaldehyde. An odds ratio is a way of comparing th**  **e difference in the probability of an event, in this case asthma diagnosis, occurring in groups exposed at different**  **levels. The odds ratio is used to determine the willingness to pay for any change in emissions**39

**exposure over a 16 year period. We assume th at the probability of being diagnosed with**  **asthma is uniformly distributed across these 16 years. The use of an odds ratio implies that the concentration**  **- response relationship is non**  **- linear.**  **However, given that the change in exposure is relatively small, the results from using this**  **implied non -** **linear function are anticipated to be similar to the results if we were to use a linear function.**  **4. Please comment on whether the concentration -**  **response function is used appropriately in the benefits assessment ap**  **proach.** It seems as reasonable as other possible approaches. **The valuation of asthma effects from formaldehyde exposure is based on valuing the incidence of asthma rather than the more standard valuation based on the exacerbation of**  **asthma symptoms. The reason for this is that a statistical relationship between formaldehyde**  **exposure and asthma exacerbation has not been sufficiently well established, but there is a statistical relationship between formaldehyde exposure and asthma occurrence or incidence.**  **H owever, the only time that EPA has valued asthma exacerbation is for the first prospective**  **study of the benefits and costs of the Clean Air Act (EPA 1999). This is probably due to a lack of an appropriate concentration**  **- response relationship. The EPA’s Offi** **ce of Air does include recommended values for the monetization of chronic asthma in its BenMAP documentation**  **(EPA 2011b), which is based on an average of the results from Blumenschein and Johannesson (1998) and O’Conor and Blomquist (1997).**  **For this analy**

**sis, EPA treats prevalence as a measure of cumulative incidence by assuming that the disease duration is the rest of the child’s life. However, the EPA (2000a) has**  **previously assumed that a portion of asthmatic children will become asymptomatic as they mov** **e into adulthood. 5. Please comment on whether the annualized approach as opposed to the lifetime approach is**  **appropriate in this context.** The approach used seems reasonable except for ignoring that some of the asthmatic children are likely to become as y

mptomatic as adults. If the incidence and prevalence data can support outgrowing asthma, then it should be incorporated in the estimates of valuing the incidence of asthma. Otherwise, the estimates will be biased upward. I agree with the choice of the b est estimate from O’Conor and Blomquist (1997) for the implied annual value of asthma control (page 47). Itis $1,474 and is based on the risk

- risk tradeoff and the assumed value of statistical life of roughl y $6 million. The $1,474 is close to the nonparametric estimates of $1,500 for the 5 unit change and $1,440 for the 10 unit change. It is also close to the parametric estimates assuming a value of statistical life of $6 million of $1,468 for Model 3 and $1,504 for Model 4. They are the more complete specifications of the drug choice logistic regression. Since survey s were done in 1995, the values are in 1995 dollars. The implied annual value of asthma control of $1,474 in 1995 dollars is also close to the best estimates from our more recent work; s ee Glenn C. Blomquist, Mark Dickie, and Richard M.40

O’Conor. “Willingness to Pay for Reducing Fatality

Risks and Asthma Symptoms: Values for Children and Adults of All Ages” Resource and Energy Economics 33 (May 2011): 410
- 425. In this recent work, we are able to estimate the willingness to pay without assuming a value of statistical life. As Table 5 shows, for the ordered logistic regression for willingness to pay for the more effective drug we have a larger sample for the preferred specification (263 in 2011 > 75 in 1997) and the ratio of the coefficient for efficacy in controlling asthma to its standard error is much larger (3.14 in 2011 > 0.70 in 1997). This facilitates estimation directly from the willingness to pay

logit rather than indirectly from the risk
- risk logit and an assumed value of statistical life. We were also able to test for selection bias related to the choice of drug at the first stage of the h ybrid contingent valuation. (We found we could not reject the null of no correlation betwee n errors and so based estimates of willingness to pay on the logit regression without selection.) Lastly, we made estimates based on using onl y “definitely yes ” as a “yes” instead of both “definitely ye s” and “probabl y yes ” as a “yes” as in O’Conor and Bl omquist (1997). In Table 6 we report values that turn out to be comparable to the best estimate from our earlier work. For the average age adult (45 ye ars) our estimate for the annual value of asthma control is $1,960 in 2007 dollars (or $1,441 in 1995 d ollars). From Table 6 which reports annual values of asthma control by age we cautiously

summarize saying that the pattern of results hints that values are higher for children and young adults. For the average age child (11 years) our estimate for annual value of asthma control is $2,842 in 2007 dollars (or $2,089 in 1995 dollars.) This pattern is relevant for estimating the asthma related benefits because the ages considered are 0

– 16 and point estimates for values for children are greater than the value for the average age adult. The pattern suggests that estimates based on the average value for adults are probabl y underestimates, at least with respect to this factor. **The concentration -**  **response relationship is based on an odds ratio for a period of t ime longer**  **than the one year. The exposure model produces results for one -**  **year of exposure to formaldehyde for each age, housing type, and climate cohort. As a consequence, an**  **adjustment to the simple model needed to be made to model the effect on individu als who are**  **currently alive when the regulation takes effect. As an upper bound estimate, we assume that the odds ratio can be applied to the one year**  **reduction in the same fashion as it was applied for the 16 year time period. The problem with this appro**  **ach is that it effectively treats the exposure as an acute effect. If the odds ratio indicates a particular percentage reduction in asthma cases from a reduction in formaldehyde**  **exposure over 16 years, the upper bound approach would suggest the same percen tage**  **reduction in asthma case in one single year if we were to witness the same reduction in formaldehyde exposure in one year. The lower bound approach assumes that a particular**  **exposure reduction for one year produces the same effect as if that exposure reduction were**  **spread out over the entire 16 -**  **year time period. 6. Please comment on the upper and lower bound methodology used.**  It seems as reasonable as other possible approaches. **The prevalence data suggest that 7.2% of children age 0 -**  **4 have been tol d that they have**  **asthma. 16.4% of children aged 5 -**  **14 have been told that they have asthma. We assume that the probability of being diagnosed is uniformly distributed across the 0 to 16 age bracket, so**  **that the incidence rate would be 1.44% for the first fi ve years and 1.49% for the next eleven** 41

**years. Allocating cases uniformly across the age brackets provides us with a way to calculate**  **the annual benefits of any exposure reduction that occurs for the entire time period, but may not be appropriate if the dia**  **gnosis of asthma for very young children (e.g., age 0 -** **2) differs from older children.**  **7. Is the assumption about applying the concentration -**  **response function to children aged 0 to 16 appropriate, given the asthma onset studies’ focus on school**  **- aged childr** **en and adolescents, and given the potential uncertainty of the Rumchev study involving younger**  **children?** It seems as reasonable as other possible approaches. A question about this and the other concentration
- response functions and exposure is whether or not they take into account averting behavior. Smell leads to open windows and more time outside of house and less exposure. Female Reproductive Toxicity **The linear concentration -**  **response function accounting for background exposures based on Taskinen et**  **al. (1999) is used for the annual approach. 8. Please comment on whether the concentration**  **- response function is used appropriately in**  **the benefits assessment approach.** It seems as reasonable as other possible approaches. **Monetization of delayed fertilit y has been discussed in the literature but has never been**  **included in primary analyses of EPA rules because it was believed that the scientific knowledge on reproductive and developmental health effects was not strong enough to**  **quantify risk in the primary benefits analysis.**  **While there appears to be good data on the cost of treatment, there are few studies on the willingness to pay to reduce delayed conception. Most economic valuation studies regarding**  **fertility focus on an individual’s or a couple’s will ingness to pay for infertility treatment,**  **particularly in -**  **vitro fertilization (IVF). Conceptually, the willingness to pay approach is preferable and could be deduced from the valuation studies. However, given that there has**  **been less research on these wil lingness to pay values than other values and the fact that the**  **values have not been used in previous economic analyses, we used the more straight -**  **forward cost of illness approach for this analysis.**  **As an upper bound, we assume that any woman who has diffi culty conceiving (i.e., time to**  **pregnancy exceeds 12 months) will obtain some type of fertility service. This may be a reasonable upper bound, but there are certainly women who have trouble becoming pregnant**  **and do not seek fertility treatment. The willi**  **ngness to pay for fertility treatment is treated as an expected value. The average cost of various cycle** **- based fertility treatments is multiplied times the probability of obtaining that**  **treatment at various ages. There is probably a small opposite effect a ssociated with an increase**  **in pregnancy from reduced formaldehyde exposure by women who do not want to become pregnant, but we do not consider this effect** 42

**9. Please comment on whether the annualized approach as opposed to the lifetime approach is appropri** **ate in this context.** It seems as reasonable as other possible approaches. On page 58, the choice is made to use the cost
- of
- illness estimates from Katz et al. (2011) for valuing difficulty

in conceiving due to formaldehyde exposure. A strength of these estimates is that apparentl y most fertility treatment costs are paid for out
- of
- pocket b y consumer/patients rather than b y third parties through private or public insurance. As such, consumers reveal that the treatments are worth at least as much as they paid. Their maximum willingness to pay would be expected to be greater than these costs because of consumer surplus. (This does not take into account an y utility

or disutility

of treatments.) If data were available and demand for fertility treatment cou ld be estimated, then a better estimate of maximum willingness to pay could be made. This suggests using cost
- of
- illness will produce an underestimate. However, if the values are applied to all women who are exposed to formaldeh yde, benefits will tend to be overestimated. The reason is that not all the women whose fertility is affected will pay

the market prices for the treatments. In other words, the price is known for the various packages of treatments, but the number of women who are willing to pay the price is not. The maximum willingness to pay

for treatment for the women whose fertility is affected but choose to forgo treatment and the number of them are unknowns. Their values are likel y t o be positive, but they are less than the costs. Katz et al. report treatment costs per successful outcome of more than $70,000. They

also report that 72% of the women had college education. A hunch is that those women have above average household incomes and spend most of their time in single family detached homes where exposure reduction is smallest. L ess educated women with lower household incomes are probably less likely to pay for treatments at the going prices. Assuming that women who have below average incomes and live in mobile homes will pay the mark et prices for the same distribution of fertility treatments is likely

to bias the estimate of benefits of reducing exposure to formaldehyde upward. **The time period associated with the exposure -**  **response function is longer than the time step of the exposure**  **model. The Taskinen (1999) study examined the fecundity of women age 20 -**  **40. This causes a problem if we have an individual who does not experience the exposure**  **reduction for the full time period. We can form an upper and lower bound of this willingness to**  **pay as we did for asthma prevalence. The upper bound is based on the assumption that the linear concentration**  **- response function holds for an acute exposure of one year. The lower**  **bound assumes that an exposure reduction for one year represents 1/20 th**  **of a n exposure**  **reduction for the entire 20 -**  **year time period. 10. Please comment on the upper and lower bound methodology used.**  It seems as reasonable as other possible approaches. **The ages used in this analysis reflect the ages reported in the Taskinen (19 99) study, ages 20** **- 40. However, women older than age 40 obtain fertility treatment. The value of reduced**  **infertility effects from reduced formaldehyde exposure is not reflected in this analysis in order to remain consistent with Taskinen (1999).** 43

**11. Pleas e comment on whether the concentration**  **- response function was applied to**  **appropriate age groups given the age groups in the studies.** It seems as reasonable as other possible approaches. **III. SPECIFIC OBSERVATIONS**  **Page 53, bottom.** $4.9 instead of $4,9. **Page 56, 3 rd**  **paragraph.** M onetization is misspelled. **Page 58.** V an Houtven and Smith (1999) instead of 1997 and $12,500 instead of $12,50. **Page 59.** Is the probability of obtaining cycle
- based fertility treatment shown in Table 8, the best projection f

or future treatment? The utilization percentages given on page 916 in Katz et al. seem different. **Page 68.** O’Conor instead of O’Connor.44 **Review By:**  **A. Myrick Freeman III, Ph.D.**45

**Peer Review Comments on EPA’s Draft Document Approach to Assessing Non**  **- canc**  **er Health Effects from Formaldehyde and Benefits from Reducing Non**  **- cancer Health Effects as**  **a Results of Implementing Formaldehyde Emission Limits for Composite Wood Products A. Myrick Freeman III, Ph.D.**  Bowdoin College July 15, 2011 **I. GENERAL IMPRESSI**  **ONS** The general model for aggregating over time and across individuals that is outlined in Section 3.1 is correct. For other “impressions,” see m y responses to specific charge questions below. **II. RESPONSE TO CHARGE QUESTIONS** Sensory Irritation **The concentration**  **- response function for the prevalence of eye irritation is based on**  **Hanrahan et al. (1984). While Hanrahan does not identify the relevant time period for this relationship, Liu et al. (1991) produced qualitatively similar results for a two**  **- wee** **k time period. We assumed that the concentration**  **- response relationship for eye irritation is for a two**  **- week**  **period and multiplied the concentration -**  **response function times 26 to obtain the number of cases of eye irritation experienced in one year.**  **The co ncentration**  **- response curve used is non**  **- linear, which means that the annual approach**  **may not produce an exact measure of the benefits, but it is believed that the bias is probably relatively small given the small change in exposure.**  **1. Please comment on wh ether the concentration**  **- response function is used appropriately in**  **the benefits assessment approach.** It was used appropriatel y. **The concentration -**  **response curve is for an acute effect occurring at a time less than the one****** **year time step of the exposure m odel. The willingness to pay to avoid cases of eye irritation is**  **calculated for each year of analysis by multiplying the number of cases in a year by the marginal willingness to pay value to avoid one case. This may produce biased results, but the**  **directio n of that bias is unknown.**  **On one hand, s ome studies have suggested that**  **the willingness to pay per symptom -**  **day declines as the number of symptom**  **- days avoided increases. In other words, the value to reduce two**  **symptom -**  **days of some effect is less than two times the value for one symptom**  **- day. Therefore,**  **this approach may overstate the total value. On the other hand, this analysis only applies values to one symptom, eye irritation, largely**  **because this is the only symptom for which an effective concentratio n**  **- response curve was**  **derived. However, there is evidence that there are other forms of minor eye, nose, and throat**46

**irritation associated with formaldehyde exposure. Since eye irritation is the largest of the median values from the Tolley et al. (1986) stud**  **y, the values used here likely represent a lower bound on the true effect of multiple symptoms. A reasonable upper bound of the total effect**  **for one symptom -**  **day would be sum of the willingness to pay for one symptom -**  **day of each effect individually.**  **2. P lease comment on whether the annualized approach as opposed to the lifetime approach is**  **appropriate in this context.** I don’t understand the question. What do you mean by the “lifetime approach”? If you mean the results shown in Table 3 on p. 42, then ei ther approach is appropriate. They are just different way s of summarizing the data. **The concentration -**  **response function for the prevalence of eye irritation is for a single two**   ** week period. The annualized approach used an adjusted concentration** **- response**  **relationship that consisted in multiplying the concentration**  **- response function obtained from Hanrahan et**  **al. (1984) by 26 two -**  **week periods. 3. Please comment on whether the adjustment of the concentration**  **- response function is**  **appropriate in the annualize d approach.**  Yes, it is appropriate. Asthma **The concentration -**  **response relationship for asthma incidence is given as an odds ratio for children exposed to formaldehyde. An odds ratio is a way of comparing the difference in the**  **probability of an event, in this case asthma diagnosis, occurring in groups exposed at different**  **levels. The odds ratio is used to determine the willingness to pay for any change in emissions exposure over a 16 year period. We assume that the probability of being diagnosed with**  **asth ma is uniformly distributed across these 16 years.**  **The use of an odds ratio implies that the concentration -**  **response relationship is non -** **linear. However, given that the change in exposure is relatively small, the results from using this**  **implied non -** **linear function are anticipated to be similar to the results if we were to use a**  **linear function. 4. Please comment on whether the concentration**  **- response function is used appropriately in**  **the benefits assessment approach.** It was used appropriatel y. **The valuat**

**ion of asthma effects from formaldehyde exposure is based on valuing the incidence of asthma rather than the more standard valuation based on the exacerbation of**  **asthma symptoms. The reason for this is that a statistical relationship between formaldehyde e**  **xposure and asthma exacerbation has not been sufficiently well established, but there is a statistical relationship between formaldehyde exposure and asthma occurrence or incidence.**  **However, the only time that EPA has valued asthma exacerbation is for the first prospective** 47

**study of the benefits and costs of the Clean Air Act (EPA 1999). This is probably due to a lack of an appropriate concentration**  **- response relationship. The EPA’s Office of Air does include**  **recommended values for the monetization of chronic asthma in its BenMAP documentation**  **(EPA 2011b), which is based on an average of the results from Blumenschein and Johannesson (1998) and O’Conor and Blomquist (1997).**  **For this analysis, EPA treats prevalence as a measure of cumulative incidence by assumi ng**  **that the disease duration is the rest of the child’s life. However, the EPA (2000a) has previously assumed that a portion of asthmatic children will become asymptomatic as they**  **move into adulthood. 5. Please comment on whether the annualized approach a**  **s opposed to the lifetime approach is appropriate in this context.**  Again, I don’t understand the question. What do you mean by the “lifetime approach”? The term is not used in the document. **The concentration -**  **response relationship is based on an odds ra tio for a period of time longer**  **than the one year. The exposure model produces results for one -**  **year of exposure to formaldehyde for each age, housing type, and climate cohort. As a consequence, an**  **adjustment to the simple model needed to be made to model t he effect on individuals who are**  **currently alive when the regulation takes effect. As an upper bound estimate, we assume that the odds ratio can be applied to the one year**  **reduction in the same fashion as it was applied for the 16 year time period. The pr oblem with**  **this approach is that it effectively treats the exposure as an acute effect. If the odds ratio indicates a particular percentage reduction in asthma cases from a reduction in formaldehyde**  **exposure over 16 years, the upper bound approach would su ggest the same percentage**  **reduction in asthma case in one single year if we were to witness the same reduction in formaldehyde exposure in one year. The lower bound approach assumes that a particular**  **exposure reduction for one year produces the same effect as if that exposure reduction were**  **spread out over the entire 16 -**  **year time period. 6. Please comment on the upper and lower bound methodology used.**  The approach seems reasonable. The bounds are relatively narrow, as shown in Table 7. How will the res ults be presented in the final report, as upper and lower bounds or averaged to give a “best” estimate? **The prevalence data suggest that 7.2% of children age 0 -**  **4 have been told that they have asthma. 16.4% of children aged 5** **- 14 have been told that they ha**  **ve asthma. We assume that the probability of being diagnosed is uniformly distributed across the 0 to 16 age bracket, so**  **that the incidence rate would be 1.44% for the first five years and 1.49% for the next eleven years.**  **Allocating cases uniformly across the age brackets provides us with a way to calculate**  **the annual benefits of any exposure reduction that occurs for the entire time period, but may not be appropriate if the diagnosis of asthma for very young children (e.g., age 0** **- 2) differs**  **from older chil**

**dren.**48

**7. Is the assumption about applying the concentration -**  **response function to children aged 0 to 16 appropriate, given the asthma onset studies’ focus on school**  **- aged children and**  **adolescents, and given the potential uncertainty of the Rumchev study inv olving younger**  **children?** I can’t answer this. It lies outside my area of expertise. Female Reproductive Toxicity **The linear concentration -**  **response function accounting for background exposures based on Taskinen et al. (1999) is used for the annual appro**  **ach. 8. Please comment on whether the concentration**  **- response function is used appropriately in**  **the benefits assessment approach.** It was used appropriatel y. **Monetization of delayed fertility has been discussed in the literature but has never been include** **d in primary analyses of EPA rules because it was believed that the scientific knowledge on reproductive and developmental health effects was not strong enough to**  **quantify risk in the primary benefits analysis. While there appears to be good data on the c**  **ost of treatment, there are few studies on the willingness to pay to reduce delayed conception. Most economic valuation studies regarding**  **fertility focus on an individual’s or a couple’s willingness to pay for infertility treatment, particularly in**  **- vitro f** 

**ertilization (IVF). Conceptually, the willingness to pay approach is preferable and could be deduced from the valuation studies. However, given that there has**  **been less research on these willingness to pay values than other values and the fact that the va**  **lues have not been used in previous economic analyses, we used the more straight -**  **forward cost of illness approach for this analysis.**  **As an upper bound, we assume that any woman who has difficulty conceiving (i.e., time to pregnancy exceeds 12 months) will**  **obtain some type of fertility service. This may be a reasonable upper bound, but there are certainly women who have trouble becoming pregnant**  **and do not seek fertility treatment. The willingness to pay for fertility treatment is treated as an expected v** **alue. The average cost of various cycle** **- based fertility treatments is multiplied times the probability of obtaining that**  **treatment at various ages. There is probably a small opposite effect associated with an increase in pregnancy from reduced formaldehyde**  **exposure by women who do not want to become pregnant, but we do not consider this effect**  **9. Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context.**  Again, I don’t understand the question. Wh at do you mean b y the “lifetime approach”? The term is not used in the document. Perhaps the charge question should be " **Please comment on the annual approach to calculating a total WTP per year as described in Section 3.4.2**  ." My49

answer to that question i s that if a valid individual WTP per year can be obtained, equation (18) is the appropriate way

to calculate aggregate WTP per year. But for reasons I point out in the Specific Observations section below (see my comments to question #3) , Ihave serious do ubts about the ability

to obtain a valid individual WTP per year. **The time period associated with the exposure -**  **response function is longer than the time step of the exposure model. The Taskinen (1999) study examined the fecundity of women age 20** **- 40.**  **This causes a problem if we have an individual who does not experience the exposure**  **reduction for the full time period. We can form an upper and lower bound of this willingness to pay as we did for asthma prevalence. The upper bound is based on the assumption t**  **hat the linear concentration**  **- response function holds for an acute exposure of one year. The lower**  **bound assumes that an exposure reduction for one year represents 1/20 th**  **of an exposure reduction for the entire 20** **- year time period.**  **10. Please comment on t he upper and lower bound methodology used.**  The approach seems reasonable. How will the results be presented in the final report, as upper and lower bounds or averaged to give a “best” estimate? **The ages used in this analysis reflect the ages reported in the Taskinen (1999) study, ages 20** **- 40. However, women older than age 40 obtain fertility treatment. The value of reduced**  **infertility effects from reduced formaldehyde exposure is not reflected in this analysis in order to remain consistent with Taskinen (**  **1999). 11. Please comment on whether the concentration**  **- response function was applied to**  **appropriate age groups given the age groups in the studies.** Given my reservations about using the cost
- of
- fertility treatment to monetize this effect (see m y comments to question #3 in the Specific Observations section below) , I have no problem in limiting the quantification of this effect to the age group covered in the Taskinen study
. **III. SPECIFIC OBSERVATIONS**  There are a number of t ypographical and editorial e rrors. This is not a complete list: **Table of Contents.** P age numbers are wrong. **Page 17.** F igure 2 should be labeled figure 5. **Section 3.** Why

do the table and figure numbers start over inste ad of continuing throughout the report? And some of the tab le numbers seem to be wrong (e.g., J
- 10 on page 36). **Page 6.** T he report gives the aim of developing concentration
- response relationships as being “ ... to inform the economic benefits assessment of potential cost savings ...” This is not about “cost sav ings;” it is about welfare gains. In some places, coefficients in the concentration
- response relationships are Greek letters. In other places they

are not.50

**Section 2.1.1, 3 rd**  **sentence in the first paragraph.** N eeds editing. **Page 53.** Where it say s “($ 93,0 95 + $58,662 + $90,852= $242,602),” it should be = $242,609. **Page 58.** It say s “willingness to pay of between $3,750 and $12,50 for fertility treatment.” **Page 59.** T he probability of using IVF should be 2.5%, not .25%. **Page 61, last paragraph.** T her e are two references to Table 10 , which should be Table 12. **Page 63.** T he sentence, “This is probably the largest category

of value associated fertility issue from a reduction in formaldeh yde exposure,” needs editing. **I have added the following**  **three char ge questions based on my ex**  **pertise in non -**  **market valuation:**  **(1) Please comment on the validity of the monetization of sensory irritation.** The approach to the monetization of this effect is the same as that used in the First Prospective Section 812 Report. In my judgement, this is a valid approach and makes the best use of the available empirical evidence. However, it should be noted that the effect actually valued in the First Prospective Section 812 Report as “Upper Respiratory S ymptoms” defined as “tw o or more of the following s ymptoms: runny or stuffy nose; coughing; and ey e irritation.” Since this document states that formaldehyde can cause a variet y of t ypes of sensory irritation in the upper respiratory

s ys tem (p. 7), this is appropriate. But it should be made clear that more than simply eye irritation is involved. **(2) Please comment on the validity of the monetization of chronic asthma.** The approach to the monetization of this effect is the same as that used in the First Prospective Section 812 Report. In m y judgement, this is a valid approach and makes the best use of the available empirical evidence. **(3) Please comment on the validity of the monetization of reduced fertility.** I have serious reservations about the approach taken here to mone tize this effect. First, “reduced fertility” is not a well
- defined effect. There is ambiguity as to both the degree of reduction and its duration. This makes determining the proper valuation difficult. I agree that conceptuall y , the willingness to pa y (WTP) approach is preferable to a cost
- of
- illness or cost - of
- treatment approach. However, as I read the available WTP studies, they appl y to the more serious infertility

rather than to the “subfertility” (p. 21) associated with exposure to formaldeh yde. Thus, the available WTP studies are not suitable for benefits transfer. The report takes a cost of treatment approach to valuation. But it is not at all clear to me that the “cycle
- based treatments” described here are either appropriate treatments or likely to be effective in the face of continued formaldeh yde exposures.51

For these reasons, I recommend that this effect be described and quantified to the extent that evidence supports quantification, but that it be acknowledged that there is not an adequ ate basis for monetization of this effect.52 **Review By:**  **Shelby Gerking, Ph.D.**53

**Peer Review Comments on EPA’s Draft Document Approach to Assessing Non**  **- cancer**  **Health Effects from Formaldehyde and Benefits from Reducing Non -**  **cancer Health Effects as a Results o** 

**f Implementing Formaldehyde Emission Limits for Composite Wood Products Shelby Gerking, Ph.D.**  University

of Central Florida July 23, 2011 **I. GENERAL IMPRESSIONS**  The report is, for the most part, complete and clearly written. I had no problem followin g the narrative, however, an executive summary , a conclusion and a map of the climate zones would have been helpful. Also, in Section 3, there are at least seven issues that warrant additional thought. First, the choice of the 3% discount rate, while no t unreasonable, appears from out of nowhere. Some attention needs to be given to this choice as well as to the assumption of exponential discounting. Other ty pes of discounting considered by behavioral economists may also be appropriate. Second, the co ntingent valuation estimates of WTP for ey e irritation are rather dated

—those obtained by

Tolley et al. are 25 years old. EPA still uses these estimates, but there have been a number of advances over the ye ars in the application of stated preference metho ds aimed at reducing h ypothetical bias which causes stated preference estimates to be too high. Third, the Dickie et al. estimates in Table J
- 10 may not be directl y comparable to those of Tolley et. al. and Loehman et. al. in that they are based on the av erting behavior method (which looks at actual purchases of goods), rather than on contingent valuation. In any case, the narrative might usefull y reflect the fact that sound willingness to pay estimates are elusive and that different methods of estimatin g WTP often give (very) different results. Fourth, both asthma and eye irritation estimates rel y on transferring adult WTP estimates to children. This procedure, which may

be the onl y available option, may well lead to substantial inaccuracies. Parents, for example, may

be WTP more to reduce health sy mptoms for their children than they are WTP to reduce those same s ymptoms for themselves. In any case, the issue of WTP for adults vs. WTP for kids (with citations to recent literature) should be a discussi on point in the report. Fifth, the WTP estimates presented implicitly assume that switching to different building materials, or treating wood products to cut down formaldeh yd e off
- gassing will not occur for the 30 ye ar horizon analy

zed. Is this assumptio n reasonable? In this same vein, could health effects from formaldeh yde off

- gassing be lessened b y providing particularl y residents of new homes with information that would lead them to install better ventilation sy stems? I f so, the marginal cost of bett er ventilation (if such a strategy is appropriate) might then form the basis of a simple WTP estimate along the lines of the headache example given on p. 31. Sixth, the population by housing t ype and climate zone apparentl y are assumed not to change over the next 30 years, even though there have been major changes in population by housing ty

pe and climate zone over the past 30 y ears. This assumption seems hard to defend, although as noted on p. 42 it would be a difficult task to predict these movements. Seventh, it would be helpful to develop the main features of the cohort x housing t ype x climate zone model in introductory Section 3.1. It would be helpful in this section to explain about the assumptions underlying this approach (some of these are identified above). This reorganization will clarify the narrative at a number of points and avoid misunderstandings created when readers simply encounter model assumptions in the explanation of results. **II. RESPONSE TO CHARGE QUESTIONS**54

Sensory Irritation **T he concentration**  **- response function for the prevalence of eye irritation is based on**  **Hanrahan et al. (1984). While Hanrahan does not identify the relevant time period for this relationship, Liu et al. (1991) produced qualitatively similar results for a two**  **- week time period.**  **We assumed that the concentration -**  **response relationship for eye irritation is for a two -**  **week period and multiplied the concentration**  **- response function times 26 to obtain the number of**  **cases of eye irritation experienced in one year. The**  **concentration -**  **response curve used is non -** **linear, which means that the annual approach may not produce an exact measure of the benefits, but it is believed that the bias is probably**  **relatively small given the small change in exposure. 1. Please comment on**  **whether the concentration -**  **response function is used appropriately in the benefits assessment approach.**  The non
- linear concentration response function is appropriatel y used in the benefits assessment approach. However, the approach used here appears to t ake no account of other sources of formaldeh yde exposure , such as workplace exposures. In an y case, the policy
- related reductions in formaldeh yde exposure should be treated as reductions in total exposure, not simply reductions in home exposure. This ref inement may

alter the benefits calculation given the use of a non - linear concentration response function. **The concentration -**  **response curve is for an acute effect occurring at a time less than the one****** **year time step of the exposure model. The willingness t o pay to avoid cases of eye irritation is**  **calculated for each year of analysis by multiplying the number of cases in a year by the marginal willingness to pay value to avoid one case. This may produce biased results, but the**  **direction of that bias is unkno wn.**  **On one hand, s ome studies have suggested that**  **the willingness to pay per symptom -**  **day declines as the number of symptom**  **- days avoided increases. In other words, the value to reduce two**  **symptom -**  **days of some effect is less than two times the value for one symptom**  **- day. Therefore,**  **this approach may overstate the total value. On the other hand, this analysis only applies values to one symptom, eye irritation, largely**  **because this is the only symptom for which an effective concentration -**  **response curve was de** **rived. However, there is evidence that there are other forms of minor eye, nose, and throat irritation associated with formaldehyde exposure. Since eye irritation is the largest of the**  **median values from the Tolley et al. (1986) study, the values used here likely represent a lower**  **bound on the true effect of multiple symptoms. A reasonable upper bound of the total effect for one symptom**  **- day would be sum of the willingness to pay for one symptom**  **- day of each**  **effect individually. 2. Please comment on whethe** **r the annualized approach as opposed to the lifetime approach is appropriate in this context.** 55

A search of the review document turned up no references to “lifetime approach”, so the issue to be addressed here is not entirely clear. Nonetheless, it is like ly that WTP per s ymptom day of eye irritation falls as the number of s ymptom day s increase. This outcome would be a general implication of utility

maximization under a fixed budget. As additional resources are spent to relieve eye irritation, the opportunity cost of foregone consumption will increase. If e ye irritation is coupled with other sy mptomatic discomforts, then we may have a different problem. On the one hand, suppose that there exists a good that will reduce eye irritation together with all of the other s ymptoms. Then, the marginal cost (inclusive of both time and money) of using the good to reduce these s ymptoms will be the WTP for all combined. On the other hand, if more than one good needs to be purchased to reduce all of the sy mptoms, the n the WTP would be the marginal cost of the combination of goods that will do the job. In an y case, it is problematic to simply add up CVM estimates of WTP for individual sy mptoms as this is likely

to yield a total WTP value that really

is upward biased. Note that the CVM estimates themselves are probabl y upward biased. **The concentration -**  **response function for the prevalence of eye irritation is for a single two**   ** week period. The annualized approach used an adjusted concentration** **- response relationship**  **t hat consisted in multiplying the concentration**  **- response function obtained from Hanrahan et**  **al. (1984) by 26 two -**  **week periods. 3. Please comment on whether the adjustment of the concentration**  **- response function is**  **appropriate in the annualized approach.** An issue here is that there appear to be different way s to interpret the Total WTP expression on p. 39. Should we assume that the same people experience eye irritation repeatedl y for each 26 two - week periods in the y ear? I f this (Groundhog Day) assumption is correct, then the WTP value applied may

well be on the high side. On the other hand, if we assume that a different set of people experience these sy mptoms in each of the two week periods, then the calculations presented may

be more defensible. Asthm a **The concentration -**  **response relationship for asthma incidence is given as an odds ratio for children exposed to formaldehyde. An odds ratio is a way of comparing the difference in the**  **probability of an event, in this case asthma diagnosis, occurring in g roups exposed at different**  **levels. The odds ratio is used to determine the willingness to pay for any change in emissions exposure over a 16 year period. We assume that the probability of being diagnosed with**  **asthma is uniformly distributed across these 16 years.**  **The use of an odds ratio implies that the concentration -**  **response relationship is non -** **linear. However, given that the change in exposure is relatively small, the results from using this**  **implied non -** **linear function are anticipated to be similar to the results if we were to use a**  **linear function. 4. Please comment on whether the concentration**  **- response function is used appropriately in**  **the benefits assessment approach.** I agree that the bias from using the implied non
- linear function is likely to be s mall, but please see #1 in the ey e irritation section for a possible qualification.56

**The valuation of asthma effects from formaldehyde exposure is based on valuing the incidence of asthma rather than the more standard valuation based on the exacerbation of**  **asthma symptoms. The reason for this is that a statistical relationship between formaldehyde exposure and asthma exacerbation has not been sufficiently well established, but there is a**  **statistical relationship between formaldehyde exposure and asthma occu rrence or incidence.**  **However, the only time that EPA has valued asthma exacerbation is for the first prospective study of the benefits and costs of the Clean Air Act (EPA 1999). This is probably due to a lack**  **of an appropriate concentration -**  **response relati onship. The EPA’s Office of Air does include**  **recommended values for the monetization of chronic asthma in its BenMAP documentation (EPA 2011b), which is based on an average of the results from Blumenschein and**  **Johannesson (1998) and O’Conor and Blomquist ( 1997).**  **For this analysis, EPA treats prevalence as a measure of cumulative incidence by assuming that the disease duration is the rest of the child’s life. However, the EPA (2000a) has**  **previously assumed that a portion of asthmatic children will become as ym**  **ptomatic as they move into adulthood.**  **5. Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context.**  A search of the review document turned up no references to “lifetime approach” so the issue t o be addressed here is not entirely clear. Nonetheless, the report makes clear that valuation of asthma effects is based on valuing the incidence of asthma, rather than s ymptom exacerbation. This approach is crude for two reasons. First, there is subst antial heterogeneity in cases of asthma. For some people, asthma is little more than an anno yance, while for others this illness is debilitating. Willingness to pay to avoid asthma would be expected to vary according to how serious a case is contemplated . Second, willingness to pay to reduce additional cases of asthma will not include the willingness to pay to reduce exacerbated s ymptoms of those who already have asthma. Two other issues: (1) While estimates of increased incidence of asthma pertain to children (see p. 19), estimates of WTP to reduce asthma incidence are based on two studies of adults. Parents may

well be willing to pay

more to reduce asthma incidence among their children than they

are WTP to protect themselves from the same illness. ( 2) It might be useful to perform a sensitivity

analy sis on the estimates provided to determine how much difference it would make to assume that a percentage of childhood asthmatics become asy mptomatic when they become adults, rather than assume that childh ood asthmatics carry their illness forward to adulthood. **The concentration -**  **response relationship is based on an odds ratio for a period of time longer than the one year. The exposure model produces results for one** **- year of exposure to**  **formaldehyde for ea ch age, housing type, and climate cohort. As a consequence, an**  **adjustment to the simple model needed to be made to model the effect on individuals who are currently alive when the regulation takes effect.**  **As an upper bound estimate, we assume that the odd s ratio can be applied to the one year**  **reduction in the same fashion as it was applied for the 16 year time period. The problem with this approach is that it effectively treats the exposure as an acute effect. If the odds ratio**  **indicates a particular perce ntage reduction in asthma cases from a reduction in formaldehyde** 57

**exposure over 16 years, the upper bound approach would suggest the same percentage reduction in asthma case in one single year if we were to witness the same reduction in**  **formaldehyde exposur e in one year. The lower bound approach assumes that a particular**  **exposure reduction for one year produces the same effect as if that exposure reduction were spread out over the entire 16**  **- year time period.**  **6. Please comment on the upper and lower bound m ethodology used.**  The upper bound estimates are obtained b y assuming that asthma onset is an acute effect of formaldeh yde exposure particularl y among older teenagers. I am uncertain as to whether this assumption is at variance with scientific information regarding the development of this disease and would defer to another panel member with greater expertise on this point. I f asthma onset from formaldeh yd e exposure cannot be considered an acute effect, then the upper bound estimates would be less credible. Nonetheless, the upper bound estimates and the lower bound estimates do not differ greatly . Table 7 reports that for the three housing profiles total discounted upper bound WTP is $4,939,166 and the corresponding lower bound figure is $4,340,740. So, the upper bound estimate is about 14% larger than the lower bound estimate. An alternative to the lower bound estimate might be to assume that currently living children are unaffected b y reduced formaldeh yde exposure. Instead, we might assume that the red uced exposure applies only

as “new” children as they enter the model. These “new” children are then assigned cases of asthma with the incidence rates described on p. 48 of the review document. **The prevalence data suggest that 7.2% of children age 0 -**  **4 h ave been told that they have**  **asthma. 16.4% of children aged 5 -**  **14 have been told that they have asthma. We assume that the probability of being diagnosed is uniformly distributed across the 0 to 16 age bracket, so**  **that the incidence rate would be 1.44% for the first five years and 1.49% for the next eleven**  **years. Allocating cases uniformly across the age brackets provides us with a way to calculate**  **the annual benefits of any exposure reduction that occurs for the entire time period, but may not be appropriat** 

**e if the diagnosis of asthma for very young children (e.g., age 0 -** **2) differs from older children.**  **7. Is the assumption about applying the concentration -**  **response function to children aged 0 to 16 appropriate, given the asthma onset studies’ focus on school**  **- aged children and**  **adolescents, and given the potential uncertainty of the Rumchev study involving younger children?**  I defer to another panel member here as I have no expertise in this area. Female Reproductive Toxicity **The linear concentration -**  **respons e function accounting for background exposures based on**  **Taskinen et al. (1999) is used for the annual approach. 8. Please comment on whether the concentration**  **- response function is used appropriately in**  **the benefits assessment approach.** The concentration
- response function appears to have been applied correctly in the benefits assessment approach. Note that the concentration
- response function is linear, so accounting for other sources of formaldehyde exposures would be less important. However, two other i ssues58

might be addressed. First, equations (18) and (19) in the text may require some clarification. My question relates to the term

, , , , [( exp ) ( exp )] hcb aseline h c policy a b osure osure        . Does a =  ? Does b =  ? I f so, the no tation should be changed. If not, the equation needs additional explanation. Second, in these equations, population refers to women who have difficulty conceiving. The population of women who are actively attempting to become pregnant would instead be m ore appropriate. P age 59 indicates that for the proposed rule this latter definition would be incorporated. I agree that this change would be appropriate. **Monetization of delayed fertility has been discussed in the literature but has never been includ**  **ed in primary analyses of EPA rules because it was believed that the scientific knowledge on reproductive and developmental health effects was not strong enough to**  **quantify risk in the primary benefits analysis. While there appears to be good data on the**  **cost of treatment, there are few studies on the willingness to pay to reduce delayed conception. Most economic valuation studies regarding**  **fertility focus on an individual’s or a couple’s willingness to pay for infertility treatment, particularly in**  **- vitro**  **fertilization (IVF). Conceptually, the willingness to pay approach is preferable and could be deduced from the valuation studies. However, given that there has**  **been less research on these willingness to pay values than other values and the fact that the v** **alues have not been used in previous economic analyses, we used the more straight -**  **forward cost of illness approach for this analysis.**  **As an upper bound, we assume that any woman who has difficulty conceiving (i.e., time to pregnancy exceeds 12 months) wil**  **l obtain some type of fertility service. This may be a reasonable upper bound, but there are certainly women who have trouble becoming pregnant**  **and do not seek fertility treatment. The willingness to pay for fertility treatment is treated as an expected**  **value. The average cost of various cycle** **- based fertility treatments is multiplied times the probability of obtaining that**  **treatment at various ages. There is probably a small opposite effect associated with an increase in pregnancy from reduced formaldehyd**  **e exposure by women who do not want to become pregnant, but we do not consider this effect**  **9. Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context.**  Cost
- of
- illness estimates are conceptuall y inappropriate in this context for two reasons. First, cost - of
- illness is not a conceptuall y sound approach for estimating willingness to pay. This point is noted in the document on p. 58. In consequence, Iwould suggest that cost
- of
- illness estimates m ight be used onl y as a last resort. The WTP estimates obtained b y Smith and van Houtven may well be a more defensible choice. Careful thought should be given to whether this alteration would be an improvement. Second, the COI estimates utilized (see equ ation (20) and Table 10) do not really

pertain to the delay

in conception addressed in the Taskinen study . Women (or couples) may

be willing to pay

to reduced time to conceive, but may at the same time be reluctant to seek fertility

treatment. At a mini mum, this potential misalignment should be addressed.59

**The time period associated with the exposure -**  **response function is longer than the time step of the exposure model. The Taskinen (1999) study examined the fecundity of women age 20** **- 40.**  **This causes a p roblem if we have an individual who does not experience the exposure**  **reduction for the full time period. We can form an upper and lower bound of this willingness to pay as we did for asthma prevalence. The upper bound is based on the assumption that the**  **li near concentration**  **- response function holds for an acute exposure of one year. The lower**  **bound assumes that an exposure reduction for one year represents 1/20 th**  **of an exposure reduction for the entire 20** **- year time period.**  **10. Please comment on the upper a nd lower bound methodology used.**  The Taskinen study appears to treat formaldeh yde exposure as a long term exposure. In consequence, I am uncertain that the upper bound estimates are defensible (see the related point #6 in asthma above). Nonetheless, the upper and lower bound WTP estimates differ onl y b y about $57,000 (see Table 12). This outcome could change of course if the anal ys is is redone along lines suggested above. Also, as with asthma, I would suggest the possibility to treat “new” women enteri ng the model as those affected by the contemplated reduction in formaldeh yde exposure. **The ages used in this analysis reflect the ages reported in the Taskinen (1999) study, ages 20 -**  **40. However, women older than age 40 obtain fertility treatment. The v alue of reduced**  **infertility effects from reduced formaldehyde exposure is not reflected in this analysis in order to remain consistent with Taskinen (1999).**  **11. Please comment on whether the concentration -**  **response function was applied to appropriate age g** 

**roups given the age groups in the studies.** The Taskinen study does not appear to provide a direct basis for adding women aged 40 and older to the anal ys is. However, relativel y few of these women may seek to become pregnant in a given ye ar. If the anal y sis focused on women who seek to become pregnant, exclusion of women over 40 ye ars of age may not be a grave oversight. I would defer to a panel member more knowledgeable about fertility issues to make a judgment on this issue. **III. SPECIFIC OBSERVATION**  **S** The document appears to have been put together hastily as there are numerous ty pos and other glitches. Below is a list of ty pos that I flagged

— I am certain there are more. **Page 31, first line below eq**  **uatio n (1).**  ...risk reduction at age a. **Page 35, n ext to last line of third full paragraph.**  D ata should be day s **Page 36.** N ot sure wh y the Table is called “Table J
- 10”. Other tables are not numbered this way . Also , in this table Dickie et al. needs a date **Page 44, first line under monetization. Anal ysis should be analyses.** 60

**Page 45, Table IV.** 2
- 17 not numbered consistently with other tables, also in two places decimal points are mistakenly

used for commas **Page 53, last full line.** S hould be $4.9 million **Page 56, eighth line up from bottom.** Underg oes should be undergo **Page 57, fourth full paragraph, first line.** Ryan (1996) conducted a contingent ... **Page 58, first full paragraph, line 4.** Respondents were asked to consider taking... **Page 59, line 8 under equation (19) (and elsewhere).** The word dat a is plural, not singular **Page 59, line 12 under equation (19).**  D ifficulty is misspelled **Page 59, second line up from bottom.** R eduction is misspelled **Page 60, part of Table 9 appears to be missing.** Also, the heading is missing a number for ppb. **Page 60, Table 10.**  T he probability values are missing61

**V. PEER REVIEWER COMMENT TABLE**  **ON NON**  **- CANCER HEALTH**  **EFFECTS**

**– DERIVATION OF CONCENTRATION**  **- RESPONSE**  **FUNCTIONS**62 **I. GENERAL IMPRESSIONS NAME**  **COMMENT RESPONSE**  **John R. Balmes, M.D.**  The document is clearl y and concisel y written. The background subsections of Section 2:

Non
- cancer Health Effects

– D erivation of Concentration
- Response Functions for sensory irritation (2.1.1), asthma (2.2.1), and female reproductive toxicity (2.3.1) are extremely brief, espec iall y the latter two. While it is understandable that the EPA does not wish to be duplicative of the material in the draft IRIS document on formaldeh yde or the NAS review of the IRI S document, some readers of the “Approach” document will not have read the IR IS and NAS documents and thus will benefit from a bit more background context on formaldeh yde and asthma or formaldeh yde and female reproductive toxicity. **David Kriebel, Sc.D.**  The overall impression is of a thoughtful and well
- written document. The authors have

provided a generall y cl ear and logical explanation of their reasoning throughout. There are a few exceptions, noted below, where additional explanation or documentation could improve the presentation. **Frederick J. Miller, Ph.D., Fellow ATS**  The comments provided are related to the health assessment and concentration
- response

evaluation portion of the above cited document as this reviewer was not asked to comment on the economic benefits assessment approach. For the most part, the sections on sen sory irritation, asthma, and female reproductive toxicity are clearl y presented and the material is developed in a logical manner. Some exceptions are noted in this reviewer’s responses to the specific charge questions. The decision on the concentration
- re sponse functions to take forward to the economic benefits anal ys es is best documented for sensory irritation. This reviewer provides a suggestion for how far below 100 ppb of formaldeh yd e the modeling results developed b y the Agency based on the Hanrahan e t al. (1984) study can be used. The material included in support of using the McGwin et al. (2010) meta analy sis for asthma in children does not adequatel y describe the short comings of the meta anal ys is. The uncertainties and conflicting results of the st udies make this reviewer reticent to endorse the concentration
- response function for the odds ratio based on the McGwin et al. (2010) meta anal ys is. The case to use background adjusted exposure data for the female reproductive toxicity concentration
- respon se curve is adequately defended. However, the Agency does not indicate if the linear risk or the exponential risk curve will be used. Overall, the information presented is accurate. To their credit, in a number of places, the EPA authors have incorporated criticisms included in the NAS report of the Agency ’s draft IR IS assessment document. By addressing the responses to the charge questions, the63 Agency will be in a good position to move forward with the cost benefit analy sis required by Executive Order 128 66 related to the Formaldehyde Standards for Composite Wood Products Act. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  The draft is clearl y organized and, in large part, well
- written. Minor inaccuracies are noted

below. Most sections were clear, although some key is sues were not mentioned or are not clear; these concerns are noted below. Except in a few instances as noted below, the conclusions are effectively supported by

the text provided. Uncertainties are important to discuss. EPA has captured man y of the impo rtant ones, but may need to add more to these sections based on this and other reviewers’ comments. Being thorough in all uncertainty sections is crucial to the foundations of the benefit assessments. **II. RESPONSE TO CHARGE QUESTIONS CHARGE QUESTION 1**  **: The literature base of residential epidemiology studies of the irritation effects with quantitative**  **concentration -**  **response data was limited, but data were available from which a concentration -**  **response function could be estimated for eye irritation.**  **Plea se comment on whether the concentration**  **- response function is appropriately derived from the studies used in the draft Approach**  **Document. NAME**  **COMMENT RESPONSE**  **John R. Balmes, M.D.**  The concentration
- response function (CRF) for sensory irritation is deriv ed from one small field study , Hanrahan et al. (1984). Because most individuals exposed to formaldehyde from the products of interest will be exposed at levels below 100 ppb, the EPA is appropriatel y concerned about the form of the CRF in this range. Unf ortunately , the data for exposures below 100 ppb are not given in the original Hanrahan paper and the regression of prevalence of eye irritation and formaldehyde concentration in the paper covers the range of 100
- 800 ppb. Another issue regarding CRF deriv ation from the Hanrahan paper is the relatively small sample size (n=61). The L iu et al. (1991) study , which involved a much larger population, is supportive of the concept that there is a CRF for formaldeh yde and eye irritation at relativel y low levels o f exposure , but was not used in the actual derivation of such a CRF because of the way the authors aggregated their data into low, medium, and high levels of exposure. **David Kriebel, Sc.D.**  I see no problems with the derivation of the concentration
- respon se function itself. In

Section 2.1.3, Ithink it would strengthen the argument to at least acknowledge the problem64 of acclimatization. There is evidence from a number of studies

– notabl y the studies of studies conducting autopsies

– that there is a change over weeks in the short
- term irritant effects. One way

that this will impact the calculations is that cumulative exposure is probably not the appropriate exposure metric. The authors may have little choice to use the simplified approach they

have taken wh ich assumes a constant exposure
- response relationship over time, but they could acknowledge that there is a source of uncertainty from the changes in potency of formaldehyde over time for various endpoints. Isuspect that the irritant effects diminish with time exposed, but the other two chosen endpoints probably do not. **Frederick J. Miller, Ph.D., Fellow ATS**  The draft Approach Document adequatel y discussed the type of data available in the

literature from various studies and presented their strengths and weaknesses. The Agency wisely stayed away

from using the Liu et al. (1991) study as the primary

driver for the concentration
- response function for ey e irritation. The categories from that study were formed on using a ppm
- hr per week metric. The eye irritation studies discussed in Section 2.1.2 for a 10 % additional risk for 560 ppb for 3 hours (i.e., 1,680 ppm
- hrs) compared to 240 ppb for 5 hours (i.e., 1,200 ppm
- hrs) clearl y s how that Haber’s Law does not apply for the effects of formaldeh yde exposure on eye irritation, which agrees with Miller et al. (Haber’s rule: a special case in a family of curves relating concentration and duration of exposure to a fixed level of response for a given endpoint. Toxicology 149:21

– 34, 2000). Thus, the Agency

would have been hard pressed to defend a translation of the ppm
- hrs metric of Liu et al. (1991) as the basis for developing a concentration
- response function for eye irritation. Rather, the Hanrahan et al. (1984) study that reported ey e irritation was associated with in
home formaldeh yd e exposures ( p < 0.05) (both as “burning ey es” and “ey e irritation”) was used as the data for developing a concentration
- response relationship for eye irritation. Moreover, the logistic regression model developed by Hanrahan et al. (19 84) gave insight as to the needed nature of the curve if one were to extrapolate below the range of exposures reported b y those authors (i.e., from 100 to 800 ppb). In the opinion of this reviewer, the concentration
- response function was appropriately deri ved b y the Agency. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  First, I will comment on each study and then on the derivation process.

**Liu et al (1991):** This paper adequatel y describes how homes were randomly selected, but65 omits some key

information related to monit oring results for the homes included. The study was conducted throughout California (p. 93); a very large state with a wide range of climatic conditions. “Summer” and “winter” sampling periods were used, but these seasons are quite different in different parts of the state. It is well
- known that temperature and relative humidity

affect formaldehyde (HCHO) levels, but there is no mention of how these factors varied in the study homes or how they

may have affected measured HCHO levels. Further, the Qualit y Assurance/Quality Control methods are not described, and the number of laboratories used to analyze the passive area monitoring samples is not stated. These omissions leave this reviewer without key information to assess the accuracy or validity

of the HCHO levels reported. Residents received instructions on how to uncap, place and mail back the samplers. The use of the kitchen and master bedroom as monitoring sites may be most relevant for the homeowner and less relevant for other occupants. Althou gh averaging the monitored levels for each home may

have lost some useful variation, it is not likely that in fairly

small homes (such as mobile homes) that this loss

– except for peak exposures

– would be particularl y important. The study appropriately controls the impact of smoking indoors, and does not discuss gas cooking stoves or appliances, opening of windows and doors, or other factors that have been reported b y other authors as having non
- significant impacts on HCHO levels. More importantly , i f I am reading the article correctly (p. 92), some indoor samples in this cross - sectional study

were taken after s ymptoms were recorded. This conflicts with determining the appropriate temporal sequence of cause preceding effect. I believe m y reading is different from what EPA states on p. 10 of their draft, which indicates that exposures were recorded in a period preceding the documentation of s ymptoms. **Hanrahan et al (1984):** This cross
- sectional study , conducted in Wisconsin during July 1979, sampled a smaller number of mobile homes (65) than did L iu et al.; it also had a lower percentage of participants among those contacted (31% vs. 44%). In this study , personal samplers were used and 33 outdoor samples were taken (at least 1 in each mobile home par k). The authors noted that prior to and during sampling periods home windows were closed, gas appliances were turned off and smoking was prohibited.66 The Quality

Control and specific laboratory methods were noted (unlike in Liu et al). The indoor sampl es for each home were averaged, as in L iu et al, with similar but less specific sampling locations noted. It is not clear whether the residents or the researchers collected the air samples in this study
. Smoking was appropriately considered, and indoor and outdoor temperature and humidity , and appliance and construction characteristics were noted. Some but not all of these factors’ influences on HCHO levels were presented in the article. **Derivation:** The seasonal and cumulative averages and ranges of indoor levels, the concentration
- response data are correctl y extracted from the **Liu et al.** article. The method to estimate the average number of hours indoors seems appropriate; however, this reviewer wonders whether EPA attempted to determine whether the authors still have the raw data that could be used for a more accurate assessment of hours spent indoors. EPA had to make man y more adjustments when using the **Hanrahan et al.** article. First, EPA estimated the lower bound for the indoor levels based on the standard deviation for the outdoor levels; this is a reasonable approach given the missing data for the indoor levels. Second, the Agency

assumed that the distribution of indoor levels is log
- normal in order to estimate the number of samples with HCHO levels below 100 and 50 ppb. However, if this assumption or the estimated standard deviation is not correct, the numbers of samples could be quite different. It is not clear in Figure 2 whether the data shown are for EPA’s or the authors’ use of “ey e i rritation;” e.g., does “eye irritation” here mean the “burning eyes” AND “ey e irritation” results in the article? I f combined data were used, did EPA assume that all of these sy mptoms were distinct and not co
- occurring events? Are we looking at data for the number of s ymptoms reported or the number of people with ey e sy mptoms (meaning “burning ey es” and “ey e irritation”) at each level of exposure? This question should also be asked of the data shown in the draft Table 1. Without knowing whether EPA comb ined data in Figure 2 and Table 1, it is difficult to comment further on this part of the draft. The conversion of data in the article to prevalence odds seems appropriate. The display of67 estimates below 150 ppb in Figure 4b are derived from Equation 2
- 2 and are likely correct. This reviewer did not verify the mathematics. The EPA authors have noted many key uncertainties in the two studies and how these affect their estimates of the relational function. However, the validity of the HCHO monitored lev els remains a question, due to missing information in the articles; exposure misclassification is possible in both studies but is not discussed in the draft. **CHARGE QUESTION 2: Please comment on the validity of extrapolating the concentration**  **- response**  **function and using the function to estimate effects at concentrations below 100 ppb.**  **NAME COMMENT**  **RESPONSE John R. Balmes,**  **M.D.** Given the limitations of the data available from the Hanrahan paper, the method of

derivation of the CRF including the portio n of the curve below 100 ppb is appropriate, but the extrapolation is pushing the envelope of what reasonabl y can be extracted from the data. The assumption that the reported standard deviation of the outdoor formaldehyde measurement s represents the lower bound on the standard deviation of the indoor concentration s appears reasonable, but nonetheless the distribution of exposure data below 100 ppb in the Hanrahan study was assumed rather than based on the actual data. The EPA used the graphical display of the regression data over the range of 100
- 800 ppb in the Hanrahan paper to derive a CRF and then to infer the shape of the CRF below 100 ppb
. Given that the Hanrahan study onl y included 61 subjects and that the formaldeh yde measurements in the mobile hom es were onl y for 30
- 60 minutes, the validity of the extrapolated CRF can be questioned even if an appropriate method was used. **David Kriebel, Sc.D.**  I am comfortable with this extrapolation. However , I think that it would be appropriate to

acknowledge that errors in exposure estimation in the studies on which the function is based have not been included in the uncertainty calculations. This is a general concern

– for all 3 endpoints, there were certainly errors in the exposure estimation, and the impact of these on the uncertaint y in the exposure
- response function has not been considered. It might be noted that the extrapolation downwards assumes a logistic shape, which is reasonable but not subject to validation. It might be noted that the excellent R2 fo r Figure 3b is a bit misleading since it is fitting a curve to categorical data, while the actual individual exposure data were of course continuous

– the fit of this curve to the original data would not have been nearl y as good. And again, see my comment just above about failure to point out that the exposure data had error , which was not taken into consideration68 in the model error calculations. **Frederick J. Miller, Ph.D., Fellow ATS**  The Agency appropriately

focused on the data from the Hanrahan et al. ( 1984) study to develop the concentration
- response curve for eye irritation. Importantly , the Agency used a power law curve to fit the prevalence odds data. This ensures that the fitted curve will asy mptoticall y approach zero for a zero formaldehyde exposur e level and makes it reasonable to use Equation 2.2 below 100 ppb. Given (1) the limit of detection (L OD) was 10 ppb at the time the Hanrahan et al. (1984) study was conducted, (2) the Agency ’s assumption about the outdoor standard deviation of measurement s being 30 ppb around a log
- normal distribution of measurements, and (3) the known overall shape of the concentration
- response curve below 100 ppb, this reviewer believes it would be reasonable for the Agency

to use the fitted equation down to a level of a bout 40 ppb, which would correspond to the LOD plus one standard deviation. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  The validity of the extrapolation in the Hanrahan et al. paper depends in part on what data were used for the outcome measure. If “burning eye” AND “eye irritation” data were combined, more information is needed in the draft to describe what assumptions were made in the combining process. (See comments above.) The validity

of the estimates below 100 ppb based on the Hanrahan et al. data is strength ened b y their alignment with the results in the L iu et al. study
. However, clearer discussion of the Agency ’s choice of and uncertainties in the points of departure would improve this portion of the draft. **CHARGE QUESTION 3: The studies considered for**  **the concentration -**  **response function are residential studies because residential exposures are the focus of the rule and the residential studies avoid some of the limitations of other types of studies (e.g.**  **, controlled exposure chamber studies used high, ac**  **ute exposures, and occupational studies reflect high exposure levels and potential dose -**  **rate effects from peak exposures). Are there other studies (e.g., chamber or non**  **- residential studies) that should be used as supporting**  **evidence for the currently deri ved concentration**  **- response function for eye irritation? If so, please provide information about the**  **studies and discuss how they should be used to support the concentration -**  **response function. NAME**  **COMMENT RESPONSE**  **John R. Balmes, M.D.**  I do not know of other studies that would be better to use for derivation of a CRF for

formaldeh yde exposure and sensory irritation given the EPA’s interest in chronic, low
level, non
- peak exposures. **David Kriebel, Sc.D.**  I think you should use the other studies

– particu larly the chamber studies and the autops y studies

– to show the consistency of the findings across many settings. I am comfortable69 with the argument that the function should be derived from the residential studies. But I think that the logic of extrapolati ng downwards is supported by some of the other studies. Kriebel et al
. Arch Env Hlth 2001; 56:11
- 18 contains fairly detailed exposure data linked to eye irritation scores. While much of the data are above the range you are concerned with, there is evidenc e here that the relationship observed was valid across the full range of exposures. **Frederick J. Miller, Ph.D., Fellow ATS**  Be yond the studies considered b y EPA, this reviewer knows of no chamber or

epidemiology

studies that would be useful in developing the concentration
- response function for eye irritation. Given the definition of an inhalation RfC and the focus on extended periods of exposure, the residential studies were conducted in a manner that best fits the criteria for developing a RfC and using i t in the benefits analy ses that the Agency is being required to conduct. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  I am not aware of an y other studies that should be considered for this function. **CHARGE QUESTION 4: Are there other sensory irritation endpoints bes**  **ides eye irritation for which a concentration -**  **response function can and should be developed for assessing effects at concentrations below 100 ppb? If so, please provide references**  **of appropriate studies and a description of how the studies could be used t**  **o develop a concentration -**  **response function. NAME**  **COMMENT RESPONSE**  **John R. Balmes, M.D.**  I do not know whether a CRF can be developed for other sensory irritation endpoints. **David Kriebel, Sc.D.**  Both nose and throat irritation can be linked to increas ed risk of lower respiratory tract infection including bronchitis. So you could argue that these would have greater economic impacts. **Frederick J. Miller, Ph.D., Fellow ATS**  Sensory irritation may

be indirectly

reflected in pulmonary

function responses m easured after exposure to formaldehyde. However, these studies were not conducted at levels that would be relevant to what the Agency is being charged with investigating. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  I agree with EPA and NAS that ey e irritation is the m ost sensitive sensory irritation

endpoint and therefore is the most appropriate endpoint to use. **CHARGE QUESTION 5 :**  **Several studies of the association between formaldehyde and asthma have been published and these were quantitatively summarized in a met**  **a -**  **analysis by McGwin et al. (2010). Please comment on whether the McGwin et al. (2010) meta**  **- analysis is an appropriate summary of the association between**  **formaldehyde inhalation exposures and childhood asthma. NAME**  **COMMENT RESPONSE** 70

**John R. Balmes, M.D.**  The McGwin et al. (2010) meta
- anal ys is of the association between formaldehyde exposure

and risk of asthma in childhood appears to have been well conducted, using state
- of
- the
- art methods, including both fixed and random effects models and various sensiti vity anal ys es. Because the meta
- anal ys is was based on a sy stematic review of the literature that appears to have been comprehensive, the results can be considered an appropriate summary of what is known about the association from epidemiological studies. **David Kriebel, Sc.D.**  I agree that it is appropriate. **Frederick J. Miller, Ph.D., Fellow ATS**  There are man y problems with the studies used in the meta anal ys is conducted by M cGwin et al. (2010). Relative to the description of the metal anal ys is, the Age ncy d id a reasonable job of pointing out many o f the strengths and weakness that McGwin and colleagues noted in their paper, but this description could be improved. There are various inconsistencies in the studies selected for the meta analy sis that woul d make this reviewer reticent to put much trust in the findings for applicability t o the U.S. population. First, onl y one study w as conducted in the U. S. and that study d id not find a statistically

significant odds ratio (OR) with exposures being in the r ange of 30 to 80 μg/m 3 of formaldehyde. Moreover, the sample size of the U.S. study w as greater than that of 5 of the other studies contained in Table 1 of McGwin et al. (2010). A Swedish study

w ith exposures no greater than 10 μg/m 3 had an OR more than twice that of an y other stud y even though several of those studies involved formaldehyde exposures in the 5 to 70 μg/m 3 range, including another Swedish study
. The Zh ao et al. (2008) study results are inconceivable to this reviewer for inclusion in a reliab le meta analy sis. With school exposures (1 to 5 μg/m 3 ) and outdoor exposures (5 to 7 μg/m 3 ), mean OR estimates were found to represent decreased risk, yet the upper bound of the 95 % confidence interval was 17 for the school OR and more than 2.3 million fo r the outdoor OR for the same set of 1,993 children having a mean age of 12.8 years. McGowan et al. (2010) state that to evaluate whether the results they f ound were undul y influenced by

any i ndividual study

and to determine if there was any p ublication bias, an influence plot and a funnel plot, respectivel y were used. However, they did not present these plots in their paper. The computed values of the Q and I2 statistics were stated to support the presence of moderate between
- study heterogeneit y. The EPA document cites71 values for these statistics but does not explain how they are calculated, but should do so. Q (better known as Cochran’s Q) is a classical measure of heterogeneity and is calculated as the weighted sum of squared differences between individ ual study e ffects and the pooled effect across studies, with the weights being those used in the pooling method. Q is distributed as a chi
- square statistic with k (number of studies) minus 1 degrees of freedom (d.f.). The I 2 statistic describes the percent age of variation across studies that is due to heterogeneity

rather than chance and is computed as 100* (Q

– d.f.)/Q. On page 18 of the EPA document, the overall OR for a fixed effects model is given as 1.026 but on page 20 the same result is stated as an OR of 1.03. The Agency n eeds to be consistent. If the data are only sufficient to give an OR with 2 digits after the decimal point, say s o and change the value on page 18 and vice versa. For the reader to better judge the reasonableness of the meta anal ys is results, the EPA document should include Table 1 of the McGwin et al. (2010) paper in addition to Figure 1 from that paper. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  The authors clearl y built on well
- accepted guidelines for s ys tematic meta
- analy sis (Stroup

et al. , 2000). The stud y s election/exclusion criteria and process used b y M cGwin et al. is well
- documented in their article. The variables extracted and utilized are stated. The determination to use a consistent metric (odds ratio per 10 μg/m 3 with the relate d 95% confidence interval) across the 7 studies for which actual HCHO measurements were available is appropriate. The methods used to pool the odds ratios and test for heterogeneity

are standard anal yt ic approaches. Their evaluation of the potentially un due influence of an y one study, using influence and funnel plots, adds strength to their anal ys is. The results are shown with and without Rumchev et al., allowing the reader to judge whether this paper should have been included or not. The data in Table 2 indicate that the magnitude of the HCHO effect on asthma prevalence is significant whether this study is included or not. The presentation of the Q and I 2 statistics guides the reader to the key results for interpreting the data in this table. In summary , this reviewer finds that the McGwin et al. meta
- analy sis is an appropriate summary and sy nthesis of the eligible studies reporting a quantitative relationship between HCHO and prevalence of childhood asthma. **CHARGE QUESTION 6: Please comment on wheth**  **er EPA chose the appropriate function from the McGwin et al. paper to use in the benefits assessment.**  **NAME COMMENT**  **RESPONSE John R. Balmes,**  **M.D.** Exponentiating the linear slope of the fixed effects model from the McGwin et al
. paper is

appropriate, espe cially

given that the random effects model gave essentiall y the same72 pooled odds ratio. **David Kriebel, Sc.D.**  I am comfortable with the choice to exclude Rumchev, and agree with the derivation of the

function as described. **Frederick J. Miller, Ph.D., Fe**  **llow ATS** The EPA document does not specifically s tate which model result (i.e. fixed effects or random effects) was selected. Rather they s tate that the mean OR was 1.24 per 10 ug formaldeh yde per m 3 for both models. One only d etermines that the Agency c ho se to use the random effects model if one calculates the transformed 95 % confidence interval for an OR for an increase of 1 ppb and sees that what is stated on page 18 corresponds to the confidence interval for the random effects model. The lack of sign ificant between
- study h eterogeneity

i n the meta anal ys is of McGwin et al. (2010) supports using a fixed effects model; however, the extent of the uncertainties among the studies and the fact that the random effects confidence interval will alway s be larger than the fixed effects confidence interval supports the conservative selection by the Agency to use the random effects model results. In view of the additional problems this reviewer discussed earlier concerning the choice of studies for inclusion in the meta anal ys is, this reviewer would be reticent to have the benefits assessment use only o ne function (i.e., the OR of 1.03 per one ppb increase in formaldeh yde exposure with a 95 % confidence interval from 1.008 to 1.047). The single U.S. study

s hould als o be evaluated wherein the OR is 1.0083 per 1 ppb increase in formaldeh yde exposure with a 95 % confidence interval of 0.97 to 1.045. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  The Agency has chosen the appropriate function from the McGwin et al. paper. With the e xception of the discussion of the rationale for excluding Rumchev et al., however, more insightful comments about the strengths of the meta
- anal ys is would lend greater support to the Agency ’s use of and reliance on the fixed
- effects model’s OR=1.24. Deepe ning the discussion would improve the support for the Agency ’s conclusions and recommendation. For example, McGwin et al. stated that an I2 value of <50% would point to relying on the fixed
- effect results (p. 314). Although the Agency uses the fixed
- effe ct modeling results, correctly stating that the Q and I2 data indicate low heterogeneity , the draft does not include the key cut - point (I 2 <50%) for the use of fixed
- vs. random
- effect modeling results. In this reviewer’s opinion, pointing the reader expl icitly to this cut
- point and the relevant data in McGwin et al.’s Table 2 would sharpen the Agency’s rationale for choosing the fixed
- effect results73 The discussion of uncertainties in this section includes the key issues (such as the changes in definition and determination of “asthma” over time) and is appropriatel y written. **C HARGE QUESTION 7**  **: The literature base describing reproductive effects of formaldehyde exposure in humans is limited;**  **however, there are supportive findings from the animal toxicolog ical literature. The epidemiologic literature suggests an association**  **between formaldehyde and increased risk of spontaneous abortion and a related delay in time to pregnancy (i.e., reduced ferti lity).**  **The only study with quantitative concentration -**  **respo nse data was Taskinen et al. (1999).**  **The a priori**  **hypothesis in Taskinen et al. (1999) was that formaldehyde would be associated with decreased fertility. The primary analyses showed that there was a statistically significant reduction of fertility among**  **the women in the highest exposure group that appeared to be concentration dependent. Post**  **- hoc subgroup analyses showed that stratification of the 39 women in the highest**  **exposure group by reported glove use yielded effect estimates whose confidence inter vals overlapped. The FDR for the 17 women**  **who were classified as not wearing gloves was 0.51 [95% CI: 0.28 −0.92]. The FDR for women who were classified as always or**  **sometimes wearing gloves was 0.79 [95% CI: 0.47 −1.23].**  **In light of the results regardi ng glove use, in what way(s) can the Taskinen et al. results be used to support calculating a**  **concentration response for formaldehyde inhalation risk to time to pregnancy? NAME**  **COMMENT RESPONSE**  **John R. Balmes, M.D.**  The results of the stratified anal ys is regarding glove use are suggestive of the possibility

that the dermal route may contribute to total exposure, but are not adequate to consider modification of a CRF for decreased fertility based on inhalational exposures, especially given the small size o f the two strata and the wide confidence intervals of the FDR point estimates. **David Kriebel, Sc.D.**  Yes, but you could strengthen your argument. First, there is a trend in both FDR and

spontaneous abortion across levels of formaldeh yde, so you should not only focus on the effect modification b y glove use in the high exposure group. While the high exposure is the only group for which the authors provided the results stratified by glove use, the fact that there is a trend across air concentrations suggests that glove use

– not constant across exposure levels

– could not be a very important source of protection or you would not see the trend. Second, you have not correctl y dealt with the question of whether or not there is effect modification b y glove use. Th e overlap of confidence intervals is not the correct way to do this. Construct the null hy pothesis that glove users and non
- users have the same FDR and then calculate a p
- value testing this null. You can do it with the data provided

– back calculate the st andard errors from the confidence intervals, or ask the authors for the74 standard errors. I am pretty sure that this p
- value will be large, and then yo u will be in a strong position to say

that the appropriate conclusion is to act as if glove use has not mo dified the FDR. **Frederick J. Miller, Ph.D., Fellow ATS**  The results after stratifying for glove use are indirectly supportive for an inhalation effect of formaldeh yde on the fecundity density ratio (FDR). Those women who did not wear gloves had a statist ically

significantly

decreased FDR of 0.51 (i.e., 95 % confidence interval did not include 1). Women classified as alway s or sometimes wearing gloves had a FDR closer to 1 and their confidence interval included 1. Thus, the inclusion of women wearing glove s would tend to move the overall FDR closer to 1, where FDR values lower than 1 can be interpreted as an adverse effect in that the time to achieve conception is delayed. This was indeed the case since a FDR of 0.64 was found for all women in the highest e xposure group. This provides evidence in support of the hypothesis that effects on FDR were most likely due to inhalation exposure rather than to dermal exposure to formaldehyde. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  The article (p. 208) is not clear as to wheth er the post
- hoc anal ys is was adjusted for the

variables noted in the footnote of Table VI; if not, the post
- hoc results would not be directl y comparable to the data presented there. That said, the reported post
- hoc high exposure group glove/not odds ratio s and confidence intervals expand and are consistent with the trend shown in Table VI. However, all of the confidence intervals overlap each other, yi elding a set of non
- significant odds ratios. If the adjusted post
- hoc odds ratios are available, it woul d be interesting to see the results of a test for trends comparing high exposure - gloves not used, high exposure
- gloves used, medium exposure, and low exposure. The trend probably

is not significant, but testing its significance may offer more information for interpreting the concentration
- response relationship. **C HARGE QUESTION 8**  **: Please comment on whether the concentration**  **- response function is appropriately derived from the**  **Taskinen et al. (1999) study. NAME**  **COMMENT RESPONSE**  **John R. Balmes, M.D.**  The C RF for formaldeh yde exposure and decreased fertility appears to be appropriatel y derived from the Taskinen et al. (1999) study. The adjustment for probable exposure to formaldeh yde outside of the workplace is appropriate given the interest of the EPA in p otentially controlling indoor exposures due to off
- gassing from certain products. The use of reasonably

contemporaneous background exposure data from Finland (Jurvelin et al., 2001) for this adjustment is also appropriate. **David Kriebel, Sc.D.**  Can’t you ask Taskinen to confirm your (and my) assumption that age was the conditioning

time variable in their FDR calculations?75 The process of adjusting for background exposure is OK, but Idon’t think it strengthens the presentation. First, I doubt very much th at the relevant background formaldehyde exposure for the women in this plant could have been so much higher than the levels inside the plant. My guess is that the mean (one mean for an entire country over a long period of time? How useful is that?) had a w ide range around it. Second, any of m y graduate students could have told you that adding a constant to all the x values in a regression model will not change the slope. **Frederick J. Miller, Ph.D., Fellow ATS**  A concentration
- response function can be deriv ed from the Taskinen et al. (1999) study ,

and the selected function must be one for which there was an adjustment for background exposure levels; however, the EPA document does not actually s tate whether they

w ill use the linear function of risk or the exp onential function of risk equations that are discussed in the document (i.e. will the Agency use Eq. 2
- 5 or 2
- 6?). The two curves presented in Figures 6 and 7 of the Agency d ocument are not explained either in the figure legend or in the text. While they obviously r elate to the regression of risk on formaldeh yd e concentration, their difference is not explained. The Agency c learl y picked up on most of the criticisms provided by the NAS review of the draft IRI S document related to the Taskinen et al. (1999) study
. However, the Agency ’s section on the discussion of uncertainties does not comment at all on the clear possibility of confounding due to xylene exposures in the Finnish worker study
. Also, there is no discussion of the possible magnitude or direction of any e xposure misclassification bias in the Taskinen et al. (1999) study
. If the Agency i s going to use the Taskinen et al. (1999) study i n their economic anal ys is, more attention to a description and discussion of the study ’s strengths and weaknesses i s needed. **Rebecca T.**  **Pa rkin,**  **Ph.D. , MPH**  Exposure measurements were available onl y for the middle of the study period, but the

authors were able to verify “most” women’s self

- reported exposure levels based on data from their workplaces. The article does not state whether this verification was completed to the same extent across the entire study period. This reviewer also wonders whether for some women (outside of the undefined “most”) the authors assumed that self
- reported HCHO exposure levels were accurate and did not change during the study period. The Agency draft notes general exposure measurement concerns and agrees with Taskinen et al. regarding their modest response rate to the mailed questionnaire.76 Although Taskinen et al. note that reportin g biases may be present in their study , they did not report an y evaluation of their data to address that concern. For example, the response rates for women with pregnancies in the 1985
- 90 vs. 1991
- 95 periods were quite different. Although the authors not e that “ onl y a few women could not report the length of time to pregnancy ,” they

do not indicate whether more women in the earlier vs. later period were non - reporters. Also, there is no mention to what extent the authors believe the recall of the number o f months
- to - pregnancy was accuratel y recalled b y either group of women. Neither Taskinen et al. nor EPA adequately discuss whether self

- reported time
- to pregnancy

(or spontaneous abortion) data are reliable for use as an outcome measure. If outcome miscl assification is an issue as well as exposure misclassification, the odds ratios could be further compromised toward the null. Discussion of the reliability of self
- reported outcome data should be considered for the next draft. The Agency ’s adjustment for non - occupational HCHO exposures, based on contemporaneous data, shifts the relationship to the right (from Figure 6 to Figure 7) but does not consider the variation in exposure levels found by Jurvelin et al. The draft assumes that all of the women in th e study had the same non
- occupational HCHO exposures. Considering the range, not just the mean, of Jurvelin et al.’s measurements would be more informative and would allow for the identification of upper and lower bounds on the concentration
- response relationship.

**III. SPECIFIC OBSERVATIONS ON THE DOCUMENT**  **NAME COMMENT**  **RESPONSE John R. Balmes,**  **M.D. Page 10, 1**  **st full paragraph; page 14, figure 4a legend; page 15, 2**  **nd full paragraph.**  The

use of “inhalation” exposure in the context of eye irritation seems inappropriate. I would eliminate the use of “inhalation” in all three sentences. **Page 16, paragraph. 2.2.1.** Asthma is defined b y the Global Initiative for Asthma (GINA) as a disease characterized by inflammation of the airway s, not lungs. I would eliminate “and lungs” in the first sentence of this paragraph. To avoid confusion, I would not use “sensitization” when discussing non
- allergic, neurogenic mechanisms of irritant chemical
induced asthma in the third sentence. **Page 20, paragraph 2.3.1.** “Increased relative risk estimates (RRs) were in the range of 1.7 to more than 3.0.” To avoid confusion, I would cite the specific papers that reported77 these increased relative risks. **Page 22, last sentence of text.** The text here refers to “estimated con centration
- response functions” but does not explain why there is more than one CRF in Figure 6. It is not until page 24 that one learns that “Regression equations for linear and exponential fits are also provided.” If the two lines in Figures 6 and 7 are for both ty pes of fits then this should be clearl y indicated. **Page 26, last full sentence.** The use of a contraction here (“didn’t”) is unprofessional. **David Kriebel, Sc.D.**  **Page 20, s ection 2.3.1, 6**  **th and 7**  **th lines.**  The statement “Increased relative ri sk estimates

(RRs) were in the range of 1.7 to more than 3.0” is not helpful

– without explaining whose risk is being compared to whose, the absolute value of an RR is not useful. **Section 2.0 Background on the Identification of Non -**  **Cancer Health Effects, last**  **sentence.** It would be helpful to summarize at least briefly the logic behind focusing on these 3 endpoints. If I have understood the NAS comments correctl y, that Committee also raised questions about these choices, and in particular on the decision n ot to use pulmonary function evidence. Given this concern from the NAS, Ithink a bit more explanation of the perceived inadequacies in the data for the other endpoints would strengthen this document. **Frederick J. Miller, Ph.D., Fellow ATS**  None. **Rebec ca**  **T. Pa**  **rkin, Ph.D.**  **, MPH** Eye Irritation

**Page 10, last paragraph, line 4 and Figure 2, line 2.** The EPA draft states that these samples were taken from 30
- 60 minutes, but the authors only mention pumps running “for approximately

one hour” (p. 1026). Does EPA have information in addition to what is in the article or is the 30
- minutes an error? **Pages 11 -**  **12.** Figure 2 in the draft has a more detailed caption, but otherwise seems to be exactly the same as the one in the Hanrahan et al. paper (which is data for “burning eyes”); is it the same as in the paper? If so, shouldn’t it clearl y indicate that it is “burning eye” data? **Page 12.** Table 1 may

need a clearer caption indicating whether the data shown are for78 “burning ey es” AND “eye irritation” or “eye irritation” alone. Wherever combined data are used, EPA should clarify this usage and possibly create a new name for combined eye sy mptom data. Further, the title of Table 1 would be more accurate if it included “...extracted and calculated from...” Asthma **Page 16, last paragraph, last 2 lines and top of page 1.** The descriptive language in the Agency draft about using the McGwin et al.’s I2 statistic would be stronger if made more specific; e.g., noting that McGwin et al. used a cut
- point of <50% for c hoosing fixed
- vs. random
- effects data (page 314, top of middle column). It appears that EPA agreed with this cut - point. **Page 18, first complete paragraph, line 6.** The Agency states that the I2 statistic is 11.2 when the Rumchev et al. paper is exclud ed, but Table 2 in McGwin et al. shows 11.3. Female Reproductive Toxicity **Page 22.** The title on Table 2 should state which “response” (TTP) is presented.79 **V I**  **. PEER REVIEWER COMMENT TABLE**  **ON THE BE**  **NEFITS ASSESSMENT APPROACH**80 **I. GENERAL IMPRESSIONS N**  **AME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** Overall, the draft Approach Document is well
- written. Refreshingl y, Standard English

language is used extensively and technical terms introduced when necessary . Examples to explain terms such as odds ratios should make the document understandable to educated lay readers with varied backgrounds. The key concentration
- response functions are clearl y presented in the form of equations and graphs or tables. This draft is readable. Information presented appears to be accurate and representative of studies that are the source of the information. Brief descriptions of key studies are given in addition to the findings relevant to the topic of this draft Approach Document. The extensive list of references allows the reader to learn more about the studies from which crucial estimates are taken. Conclusions regarding concentration
- response functions and valuation (monetization) as reflected in their use in the examples follow from the information and models presente d in a logical and reasonable way . M y assessment of presentation applies to the entire document. My assessment of accuracy

and soundness applies mostly to Section 3 Benefits Assessment Approach because of m y background in environmental and health economi cs. **A. Myrick Freeman III, Ph.D.**  The general model for aggregating over time and across individuals that is outlined in

Section 3.1 is correct. For other “impressions,” see m y responses to specific charge questions below. **Shelby Gerking, Ph.D.**  The rep ort is, for the most part, complete and clearly written. I had no problem following the narrative, however, an executive summary , a conclusion and a map of the climate zones would have been helpful. Also, in Section 3, there are at least seven issues th at warrant additional thought. First, the choice of the 3% discount rate, while not unreasonable, appears from out of nowhere. Some attention needs to be given to this choice as well as to the assumption of exponential discounting. Other ty pes of discounting considered b y behavioral economists may also be appropriate. Second, the contingent valuation estimates of WTP for eye irritation are rather dated

—those obtained by

Tolley et al. are 25 ye ars old. EPA still uses these estimates, but there have bee n a number of advances over the years in the application of stated preference methods aimed at reducing hy pothetical bias which causes stated preference estimates to be too high. Third, the Dickie et al. estimates in Table J
- 10 may not be directl y compara

ble to those of Tolley

et. al. and Loehman et. al. in that they are based on the averting behavior method (which looks at actual purchases of goods), rather than on contingent valuation. In an y case, the narrative might usefull y reflect the fact that sound willingness to pay estimates are elusive and that81 different methods of estimating WTP often give (very) different results. Fourth, both asthma and eye irritation estimates rel y on transferring adult WTP estimates to children. This procedure, which may be the onl y available option, may well lead to substantial inaccuracies. Parents, for example, may be WTP more to reduce health symptoms for their children than they

are WTP to reduce those same sy mptoms for themselves. In any case, the issue of WTP for adults vs. WTP for kids (with citations to recent literature) should be a discussion point in the report. Fifth, the WTP estimates presented implicitly assume that switching to different building materials, or treating wood products to cut down formaldeh yde off

- gassing will not occur for the 30 y ear horizon anal yz ed. I s this assumption reasonable? In this same vein, could health effects from formaldehyde off
gassing be lessened b y providing particularl y residents of new homes with information that would lead them to install better ventilation sy stems? If so, the marginal cost of better ventilation (if such a strategy is appropriate) might then form the basis of a simple WTP estimate along the lines of the headache example given on p. 31. Sixth, the pop ulation by housing t ype and climate zone apparentl y are assumed not to change over the next 30 years, even though there have been major changes in population by housing t yp e and climate zone over the past 30 ye ars. This assumption seems hard to defend, al though as noted on p. 42 it would be a difficult task to predict these movements. Seventh, it would be helpful to develop the main features of the cohort x housing ty pe x climate zone model in introductory

Section 3.1. It would be helpful in this sectio n to explain about the assumptions underlying this approach (some of these are identified above). This reorganization will clarify the narrative at a number of points and avoid misunderstandings created when readers simply encounter model assumptions in the explanation of results. **II. RESPONSE TO CHARGE QUESTIONS CHARGE QUESTION 1:**  **The concentration -**  **response function for the prevalence of eye irritation is based on Hanrahan et al. (1984). While Hanrahan does not identify the relevant time period for th**  **is relationship, Liu et al. (1991) produced qualitatively similar results for a two**  **- week time period. We assumed that the concentration**  **- response relationship for eye irritation is for a two**  **** **week period and multiplied the concentration -**  **response function tim es 26 to obtain the number of cases of eye irritation experienced**  **in one year. The concentration**  **- response curve used is non**  **- linear, which means that the annual approach may not produce an exact measure of**  **the benefits, but it is believed that the bias is probably relatively small given the small change in exposure.**  **Please comment on whether the concentration -**  **response function is used appropriately in the benefits assessment approach.**82 **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** The change in exposur e expected from the policy appears to be small relative to ty pical exposure. It follows that the linear approximation implied by multiplication by

26 to obtain annual changes in number of cases of ey e irritation should produce onl y a small bias. It seems as reasonable as other approaches. **A. Myrick Freeman III, Ph.D.**  It was used appropriatel y. **Shelby Gerking, Ph.D.**  The non
- linear concentration response function is appropriatel y used in the benefits

assessment approach. However, the approach used her e appears to take no account of other sources of formaldeh yd e exposure , such as workplace exposures. In any case, the policy
related reductions in formaldehyde exposure should be treated as reductions in total exposure, not simply

reductions in home expos ure. This refinement may alter the benefits calculation given the use of a non
- linear concentration response function. **CHARGE QUESTION 2: The concentration**  **- response curve is for an acute effect occurring at a time less than the one** **- year time**  **step of the exposure model. The willingness to pay to avoid cases of eye irritation is calculated for each year of analysis by**  **multiplying the number of cases in a year by the marginal willingness to pay value to avoid one case. This may produce biased results, but t** 

**he direction of that bias is unknown. On one hand, s**  **ome studies have suggested that the willingness to pay per symptom**  **- day declines as the number of symptom**  **- days**  **avoided increases. In other words, the value to reduce two symptom -**  **days of some effect is les s than two times the value for one**  **symptom -**  **day. Therefore, this approach may overstate the total value. On the other hand, this analysis only applies values to one symptom, eye irritation, largely because this is the only symptom**  **for which an effective c**  **oncentration -**  **response curve was derived. However, there is evidence that there are other forms of minor eye, nose, and throat irritation associated with formaldehyde exposure. Since eye irritation is the largest of the median values from the To**  **lley et al. (1986) study, the values used here likely represent a lower bound on the true effect of multiple symptoms. A reasonable upper**  **bound of the total effect for one symptom**  **- day would be sum of the willingness to pay for one symptom**  **- day of each effect individual**  **ly. Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context.**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** I admit to being confused by the statement that eye irritation has the largest of the median values in the Tolley

et al. (1986) study . (For full disclosure, I am one of et al.) Much of that study was published in Tolley , Kenkel, and Fabian Valuing Health for Policy (1994) particularl y in Chapter 4 by Kenkel, Berger, and me. In Table 4.3A on page 88, the median83 values for willingness to pay to avoid an additional sy mptom day

are $11 for coughing, $12.50 for eye irritation, $13 for throat irritation, and $14 for sinus congestion. All three are similar, but ey e irritation is not the largest. It will not make much difference, however, if either of the other two is used instead of $12.50 for ey e irritation. Comparing results reported in Table 4.3A and Table 4.3B suggests that willingness to pay per s ymptom - day

declines as the number of sy mptom day s avoided increases. For example, the median value for avoiding 30 s ymptom - day s of ey e irritation is $100 which is less than 30 times $12.50 (or $375). This suggests that multiplying the $12.50 times the number of day s of ey e irritation avoide d will bias the annual estimate for avoiding ey e irritation upwards if there are multiple day s for individuals. Declining marginal willingness to pay for avoided illnesses is also found in the recent study , Bosworth, Ryan, Trudy Ann Cameron, and J.R. DeShazo. “Demand for Environmental Policies to Improve Health: Evaluating Community
- Level Policy Scenarios” Journal of Environmental Economics and Management 57 (2009): 293
- 308. Table 4 also shows willingness to pay values for avoiding c ombinations of sy mptoms in a day . The willingness to pay values for avoiding combinations of sy mptoms in a day

are less than the sums of the willingness to pay values for avoiding the s ymptoms separatel y. The declining marginal value of adding another li ght s ymptom suggest that a reasonable upper bound of the annual value of the total effect for one s ymptom - day would be the sum of the willingness to pay

for one s ymptom - day

of each effect individually
. On page 34, the paragraph that begins with Tolley et al. (1986) is mostly correct. (I am a coauthor on that Tolley

report and the Berger et al. (1987) article.) It is correct, as stated, that the mean willingness to pay to relieve one s ymptom - day of a light s ymptom was $25

- $50. It is mostly

correct, as stated, that Berger et al. report higher willingness to pay values for these same s ymptoms. The difference is due to different samples. The Tolley et al. values are based on a sample of 176 respondents, some of whom had experienced the sy mptoms and some of whom had not. The Berger et al. values are based on a subsample of 119 who actually

had experienced a s ymptom. The mean values for the subsample that had experienced the s ymptoms are greater than for the full sample for five of the seven light sy mptom s, nearl y the same for one, and less for the remaining one. The mean value for eye irritation was $48.48 for the 16 who reported ey e irritation whereas the mean value was84 $27.73 for all 176 who responded. The values reported are in 1984 dollars in both the Tolley et al. report and the Berger et al. article. The median value for eye irritation of $12.50 that Weitzel (1990) found is also reported in Tolley , Kenkel, and Fabian Valuing Health for Policy (1994) in Table 4.3 on page 88. It is correct that it too is in 1984 dollars. On page 36, if the BLS Inflation Calculator is used to inflate the median value of $12.50 for eye irritation from 1984 dollars to 1999 dollars, the value is $20.03 as shown in Table J

- 10. If the same is done for 1984 to 2006, the value is $24.25, which rounds to $24, as reported below Table J
- 10. Two recent studies find that different lifetime risk profiles are valued differently; see Nielsen, J ytte Seested, Susan Chilton, Michael Jones
- Lee, and Hugh Metcal f. “How Would You L ike Your Gain in Life Expectancy to Be Provided? An Experimental Approach” Journal of Risk and Uncertainty 41 (December 2010): 195
- 218 and Cameron, T.A., J.R. DeShazo, and P. Stiffler. “Demand for Health Risk Reductions: A Cross
- national Comparison between the U.S. and Canada” Journal of Risk and Uncertainty 41 (December 2010): 245
- 273. Given the limited information on the sy mptoms of interest it is not clear how incorporate these finding into the Approach Document
. **A. Myrick Freeman I**  **II, Ph.D.** I don’t understand the question. What do you mean by the “lifetime approach”? If you mean the results shown in Table 3 on p. 42, then either approach is appropriate. They are just different way s of summarizing the data. **Shelby Gerking, Ph.D.**  A search of the review document turned up no references to “lifetime approach”, so the

issue to be addressed here is not entirely clear. Nonetheless, it is likely that WTP per sy mptom day

of ey e irritation falls as the number of sy mptom day s increase. T his outcome would be a general implication of utility maximization under a fixed budget. As additional resources are spent to relieve ey e irritation, the opportunity cost of foregone consumption will increase. If eye irritation is coupled with other s ymp tomatic discomforts, then we may have a different problem. On the one hand, suppose that there exists a good that will reduce eye irritation together with all of the other s ymptoms. Then, the marginal cost (inclusive of both time and money) of using the good to reduce these sy mptoms will be the WTP for all combined. On the other hand, if more than one good needs to be purchased to reduce all of the sy mptoms, then the WTP would be the marginal cost of the combination of goods that will do the job. In an y case, it is problematic to simply add up CVM estimates of WTP for individual sy

mptoms as this is likely

to yield a total WTP value that really is upward85 biased. Note that the CVM estimates themselves are probabl y upward biased. **CHARGE QUESTION 3: The**  **concentration -**  **response function for the prevalence of eye irritation is for a single two -**  **week period. The annualized approach used an adjusted concentration**  **- response relationship that consisted in multiplying the concentration**  **** **response function obtained from Hanrahan et al. (1984) by 26 two**  **- week periods.**  **Please comment on whether the adjustment of the concentration -**  **response function is appropriate in the annualized approach. NAME**  **COMMENT RESPONSE**  **G lenn**  **C. Blomquist, Ph.D.**  It seems as reasonable as othe r possible approaches. **A. Myrick Freeman III, Ph.D.**  Yes, it is appropriate. **Shelby Gerking, Ph.D.**  An issue here is that there appear to be different way s to interpret the Total WTP

expression on p. 39. Should we assume that the same people experienc e eye irritation repeatedly

for each 26 two
- week periods in the ye ar? If this (Groundhog Day) assumption is correct, then the WTP value applied may well be on the high side. On the other hand, if we assume that a different set of people experience these sy mptoms in each of the two week periods, then the calculations presented may be more defensible. **CHARGE QUESTION 4: The concentration**  **- response relationship for asthma incidence is given as an odds ratio for children**  **exposed to formaldehyde. An odds r atio is a way of comparing the difference in the probability of an event, in this case asthma**  **diagnosis, occurring in groups exposed at different levels. The odds ratio is used to determine the willingness to pay for an y change**  **in emissions exposure over a 16 year period. We assume that the probability of being diagnosed with asthma is uniformly distributed**  **across these 16 years. The use of an odds ratio implies that the concentration**  **- response relationship is non**  **- linear. However, given that the change in**  **exposure is relatively small, the results from using this implied non -** **linear function are anticipated to be similar to the results if we were to use a linear function.**  **Please comment on whether the concentration -**  **response function is used appropriately in the benefits assessment approach.**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** It seems as reasonable as other possible approaches. **A. Myrick Freeman III, Ph.D.**  It was used appropriatel y. **Shelby Gerking,** I agree that the bias from using the implied non
- linear function is likely to be small, but86

**Ph.D.** please see #1 in the eye irritation section for a possible qualification. **CHARGE QUESTION 5 :**  **The valuation of asthma effects from formaldehyde exposure is based on valuing the incidence of asthma r** **ather than the more standard valuation based on the exacerbation of asthma symptoms. The reason for this is that a statistica l**  **relationship between formaldehyde exposure and asthma exacerbation has not been sufficiently well established, but there is a sta**  **tistical relationship between formaldehyde exposure and asthma occurrence or incidence. However, the only time that EPA has valued asthma exacerbation is for the first prospective study of the benefits and costs of the Clean Air Act (EPA 1999). This**  **is pro**  **bably due to a lack of an appropriate concentration -**  **response relationship. The EPA’s Office of Air does include recommended values for the monetization of chronic asthma in its BenMAP documentation (EPA 2011b), which is based on an average of the**  **results f rom Blumenschein and Johannesson (1998) and O’Conor and Blomquist (1997).**  **For this analysis, EPA treats prevalence as a measure of cumulative incidence by assuming that the disease duration is the re st of the**  **child’s life. However, the EPA (2000a) has pre viously assumed that a portion of asthmatic children will become asymptomatic as they**  **move into adulthood. Please comment on whether the annualized approach as opposed to the lifetime approach is appropriate in this context.**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** The approach used seems reasonable except for ignoring that some of the asthmatic

children are likely

to become asy

mptomatic as adults. I f the incidence and prevalence data can support outgrowing asthma, then it should be incorporated in the estimates of valuing the incidence of asthma. Otherwise, the estimates will be biased upward. I agree with the choice of the best estimate from O’Conor and Blomquist (1997) for the implied annual value of asthma control (page 47). It is $1,474 and is based on the risk
- risk tradeoff and the assumed value of statistical life of roughl y $6 million. The $1,474 is close to the nonparametric estimates of $1,500 for the 5 unit change and $1,440 for the 10 unit change. It is also close to the parametri c estimates assuming a value of statistical life of $6 million of $1,468 for Model 3 and $1,504 for Model 4. They are the more complete specifications of the drug choice logistic regression. Since survey s were done in 1995, the values are in 1995 dollars
. The implied annual value of asthma control of $1,474 in 1995 dollars is also close to the best estimates from our more recent work; see Glenn C. Blomquist, Mark Dickie, and Richard M. O’Conor. “Willingness to Pay for Reducing Fatality

Risks and Asthma87 S ymptoms: Values for Children and Adults of All Ages” Resource and Energy Economics 33 (May 2011): 410
- 425. In this recent work, we are able to estimate the willingness to pay without assuming a value of statistical life. As Table 5 shows, for the ordered logistic regression for willingness to pay for the more effective drug we have a larger sample for the preferred specification (263 in 2011 > 75 in 1997) and the ratio of the coefficient for efficacy in controlling asthma to its standard error is much larger (3.14 in 2011 > 0.70 in 1997). This facilitates estimation directly from the willingness to pay logit rather than indirectly from the risk
- risk logit and an assumed value of statistical life. We were also able to test for selection bias related to th e choice of drug at the first stage of the hy brid contingent valuation. (We found we could not reject the null of no correlation between errors and so based estimates of willingness to pay on the logit regression without selection.) Lastl y, we made estim ates based on using onl y “definitely yes ” as a “yes” instead of both “definitely ye s” and “probabl y yes ” as a “yes” as in O’Conor and Blomquist (1997). In Table 6 we report values that turn out to be comparable to the best estimate from our earlier work. For the average age adult (45 ye ars) our estimate for the annual value of asthma control is $1,960 in 2007 dollars (or $1,441 in 1995 dollars). From Table 6 which reports annual values of asthma control b y age we cautiously summarize saying that the patt ern of results hints that values are higher for children and young adults. For the average age child (11 ye ars) our estimate for annual value of asthma control is $2,842 in 2007 dollars (or $2,089 in 1995 dollars.) This pattern is relevant for estimating the asthma related benefits because the ages considered are 0

– 16 and point estimates for values for children are greater than the value for the average age adult. The pattern suggests that estimates based on the average value for adults are probably un derestimates, at least with respect to this factor. **A. Myrick Freeman III, Ph.D.**  Again, I don’t understand the question. What do you mean by the “lifetime approach”? The term is not used in the document. **Shelby Gerking, Ph.D.**  A search of the review d ocument turned up no references to “lifetime approach” so the

issue to be addressed here is not entirely clear. Nonetheless, the report makes clear that valuation of asthma effects is based on valuing the incidence of asthma, rather than sy mptom exacerbat ion. This approach is crude for two reasons. First, there is substantial heterogeneity

in cases of asthma. For some people, asthma is little more than an annoyance, while for others this illness is debilitating. Willingness to pay to avoid asthma woul d be expected to vary according to how serious a case is contemplated. Second, willingness to pay

to reduce additional cases of asthma will not include the willingness to88 pay to reduce exacerbated sy mptoms of those who already have asthma. Two other iss ues: (1) While estimates of increased incidence of asthma pertain to children (see p. 19), estimates of WTP to reduce asthma incidence are based on two studies of adults. Parents may well be willing to pay

more to reduce asthma incidence among their children than they are WTP to protect themselves from the same illness. (2) It might be useful to perform a sensitivity

anal ys is on the estimates provided to determine how much difference it would make to assume that a percentage of childhood asthmatics become as ymptomatic when they become adults, rather than assume that childhood asthmatics carry their illness forward to adulthood. **CHARGE QUESTION 6: The concentration**  **- response relationship is based on an odds ratio for a period of time longer than the one**  **year. The exposure model produces results for one -**  **year of exposure to formaldehyde for each age, housing type, and climate cohort. As a consequence, an adjustment to the simple model needed to be made to model the effect on individuals who are currently al**  **ive when the regulation takes effect.**  **As an upper bound estimate, we assume that the odds ratio can be applied to the one year reduction in the same fashion as it was**  **applied for the 16 year time period. The problem with this approach is that it effective ly treats the exposure as an acute effect. If the**  **odds ratio indicates a particular percentage reduction in asthma cases from a reduction in formaldehyde exposure over 16 year s, the**  **upper bound approach would suggest the same percentage reduction in asthma case in one single year if we were to witness the same**  **reduction in formaldehyde exposure in one year. The lower bound approach assumes that a particular exposure reduction for one year produces the same effect as if that exposure reduction were spread ou**  **t over the entire 16 -**  **year time period. Please comment on the upper and lower bound methodology used.**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** It seems as reasonable as other possible approaches. **A. Myrick Freeman III, Ph.D.**  The approach seems reasonable. The bounds are relatively narrow, as shown in Table 7. How will the results be presented in the final report, as upper and lower bounds or averaged to give a “best” estimate? **Shelby Gerking, Ph.D.**  The upper bound estimates are obtained b y assuming that asthma onset is an acute effect of

formaldeh yde exposure particularl y among older teenagers. I am uncertain as to whether this assumption is at variance with scientific information regarding the development of this disease and would defer to another panel member with greater expertise on this point. If asthma onset from formaldehyde exposure cannot be considered an acute effect, then the upper bound estimates would be less credible. Nonetheless, the upper bound estimates and89 the lower bound estimates do not differ greatly . Table 7 reports that for the three housing profiles total discounted upper bound WTP is $4,939,166 and the corresponding lower bound figure is $4,340,740. So, the upper bound estimate is about 14% larger than the lower b ound estimate. An alternative to the lower bound estimate might be to assume that currentl y living children are unaffected b y reduced formaldeh yde exposure. Instead, we might assume that the reduced exposure applies only as “new” children as they enter the model. These “new” children are then assigned cases of asthma with the incidence rates described on p. 48 of the review document. **C HARGE QUESTION 7**  **: The prevalence data suggest that 7.2% of children age 0** **- 4 have been told that they have asthma. 16.**  **4% of children aged 5** **- 14 have been told that they have asthma. We assume that the probability of being diagnosed is uniformly distributed**  **across the 0 to 16 age bracket, so that the incidence rate would be 1.44% for the first five years and 1.49% for the n ext eleven years.**  **Allocating cases uniformly across the age brackets provides us with a way to calculate the annual benefits of any exposure re duction**  **that occurs for the entire time period, but may not be appropriate if the diagnosis of asthma for very yo ung children (e.g., age 0** **- 2)**  **differs from older children. Is the assumption about applying the concentration**  **- response function to children aged 0 to 16 appropriate, given the asthma onset**  **studies’ focus on school**

**- aged children and adolescents, and given t**  **he potential uncertainty of the Rumchev study involving younger children?**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** It seems as reasonable as other possible approaches. A question about this and the other

concentration
- response functions and expos ure is whether or not they take into account averting behavior. Smell leads to open windows and more time outside of house and less exposure. **A. Myrick Freeman III, Ph.D.**  I can’t answer this. It lies outside my area of expertise. **Shelby Gerking, Ph.**  **D.** I defer to another panel member here as I have no expertise in this area. **C HARGE QUESTION 8**  **: The linear concentration**  **- response function accounting for background exposures based on Taskinen et**  **al. (1999) is used for the annual approach. Please comm**  **ent on whether the concentration -**  **response function is used appropriately in th e benefits assessment approach.**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** It seems as reasonable as other possible approaches.90

**A. Myrick Freeman III, Ph.D.**  It was used appropriatel y. **Shelby Gerking, Ph.D.**  The concentration
- response function appears to have been applied correctly in the benefits assessment approach. Note that the concentration
- response function is linear, so accounting for other sources of formaldeh yde exposures would be less important. However, two other issues might be addressed. First, equations (18) and (19) in the text may require some clarification. My

question relates to the term

, , , , [( exp ) ( exp )] hcb aseline h c policy a b osure osure        . Does a =  ? Does b =  ? If so, the notation should be changed. If not, the equation needs additional explanation. Second, in these equations, population refers to women who have difficulty conceiving. The population of women who ar e activel y attempting to become pregnant would instead be more appropriate. P age 59 indicates that for the proposed rule this latter definition would be incorporated. I agree that this change would be appropriate. **C HARGE QUESTION 9**  **: Monetization of d**  **elayed fertility has been discussed in the literature but has never been included in primary analyses of EPA rules because it was believed that the scientific knowledge on reproductive and developmental health**  **effects was not strong enough to quantify risk**  **in the primary benefits analysis. While there appears to be good data on the cost of treatment, there are few studies on the willingness to pay to reduce delay** **ed conception. Most economic valuation studies regarding fertility focus on an individual’s or**  **a couple’s willingness to pay for infertility treatment, particularly in**  **- vitro fertilization (IVF). Conceptually, the willingness to pay approach is preferable and could be deduced**  **from the valuation studies. However, given that there has been less resear ch on these willingness to pay values than other values and**  **the fact that the values have not been used in previous economic analyses, we used the more straight -**  **forward cost of illness approach for this analysis.**  **As an upper bound, we assume that any woma n who has difficulty conceiving (i.e., time to pregnancy exceeds 12 months) will obtain**  **some type of fertility service. This may be a reasonable upper bound, but there are certainly women who have trouble becoming pregnant and do not seek fertility treatme** **nt. The willingness to pay for fertility treatment is treated as an expected value. The average cost of various cycle** **- based fertility**  **treatments is multiplied times the probability of obtaining that treatment at various ages. There is probably a small op posite effect**  **associated with an increase in pregnancy from reduced formaldehyde exposure by women who do not want to become pregnant, but we do not consider this effect**  **Please comment on whether the annualized approach as opposed to the lifetime approach is appropr** **iate in this context.**91 **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D.** It seems as reasonable as other possible approaches.

On page 58, the choice is made to use the cost
- of
- illness estimates from Katz et al. (2011) for valuing difficult y in c onceiving due to formaldehyde exposure. A strength of these estimates is that apparently most fertility

treatment costs are paid for out
- of
- pocket b y consumer/patients rather than by third parties through private or public insurance. As such, consumers r eveal that the treatments are worth at least as much as they paid. Their maximum willingness to pay would be expected to be greater than these costs because of consumer surplus. (This does not take into account any utility or disutility

of treatments.) If data were available and demand for fertility treatment could be estimated, then a better estimate of maximum willingness to pay could be made. This suggests using cost
- of
- illness will produce an underestimate. However, if the values are applied to all women who are exposed to formaldehyde, benefits will tend to be overestimated. The reason is that not all the women whose fertility is affected will pay the market prices for the treatments. In other words, the price is known for the various packages of treatments, but the number of women who are willing to pay

the price is not. The maximum willingness to pay for treatment for the women whose fertility is affected but choose to forgo treatment and the number of them are unknowns. Their values are likel y to be positive, but they are less than the costs. Katz et al. report treatment costs per successful outcome of more than $70,000. They also report that 72% of the women had college education. A hunch is that those women have above average household in comes and spend most of their time in single famil y detached homes where exposure reduction is smallest. L ess educated women with lower household incomes are probabl y less likely to pay for treatments at the going prices. Assuming that women who have bel ow average incomes and live in mobile homes will pay the market prices for the same distribution of fertility treatments is likely

to bias the estimate of benefits of reducing exposure to formaldeh yd e upward. **A. Myrick Freeman III, Ph.D.**  Again, I don’t understand the question. What do you mean by the “lifetime approach”? The term is not used in the document. Perhaps the charge question should be " **Please comment on the annual approach to calculating a total WTP per year as described in**  **Section 3.4.2** ." M y answer to that question is that if a valid individual WTP per year can be obtained, equation (18) is the appropriate way to calculate aggregate WTP per year. But for reasons I point out in the Specific Observations section below (see my comments to ques tion #3), I have serious doubts about the ability to obtain a valid individual WTP per92 ye ar. **Shelby Gerking, Ph.D.**  Cost
- of
- illness estimates are conceptuall y inappropriate in this context for two reasons. First, cost
- of

- illness is not a conceptually sound approach for estimating willingness to pay
. This point is noted in the document on p. 58. In consequence, I would suggest that cost
- of
illness estimates might be used onl y as a last resort. The WTP estimates obtained by Smith and van Houtven may

well be a more defensible choice. Careful thought should be given to whether this alteration would be an improvement. Second, the COI estimates utilized (see equation (20) and Table 10) do not reall y pertain to the delay in conception addressed in the Taskin en study . Women (or couples) may be willing to pay to reduced time to conceive, but may

at the same time be reluctant to seek fertility treatment. At a minimum, this potential misalignment should be addressed. **C HARGE QUESTION 10**  **: The time period ass**  **ociated with the exposure -**  **response function is longer than the time step of the exposure model. The Taskinen (1999) study examined the fecundity of women age 20** **- 40. This causes a problem if we have an**  **individual who does not experience the exposure reducti on for the full time period. We can form an upper and lower bound of this**  **willingness to pay as we did for asthma prevalence. The upper bound is based on the assumption that the linear concentration**   ** response function holds for an acute exposure of one year** **. The lower bound assumes that an exposure reduction for one year represents 1/20** **th of an exposure reduction for the entire 20** **- year time period.**  **Please comment on the upper and lower bound methodology used. NAME**  **COMMENT RESPONSE**  **G lenn**  **C. Blomquist, Ph.**  **D.** It seems as reasonable as other possible approaches. **A. Myrick Freeman III, Ph.D.**  The approach seems reasonable. How will the results be presented in the final report, as

upper and lower bounds or averaged to give a “best” estimate? **Shelby Gerking ,**  **Ph.D.** The Taskinen study a ppears to treat formaldeh yde exposure as a long term exposure. In consequence, I am uncertain that the upper bound estimates are defensible (see the related point #6 in asthma above). N onetheless, the upper and lower bound WTP estimates differ only by a bout $57,000 (see Table 12). T his outcome could change of course if the anal ys is is redone along lines suggested above. A lso, as with asthma, I would suggest the possibility

t o treat “new” women entering the model as those affe cted by the contemplated reduction in formaldeh yd e exposure. **C HARGE QUESTION 11**  **: The ages used in this analysis reflect the ages reported in the Taskinen (1999) study, ages 20** **- 40.**  **However, women older than age 40 obtain fertility treatment. The value of reduced infertility effects from reduced formaldehyde**  **exposure is not reflected in this analysis in order to remain consistent with Taskinen (1999).**93

**Please comment on whether the concentration -**  **response function was applied to appropriate age groups given the age groups in the**  **studies. NAME**  **COMMENT RESPONSE**  **G lenn**  **C. Blomquist, Ph.D.**  It seems as reasonable as other possible approaches. **A. Myrick Freeman III, Ph.D.**  Given my reservations about using the cost
- of
- fertility treatment to monetize this effect (see my comments to question #3 in the Specific Observations section below) , I have no problem in limiting the quantification of this effect to the age group covered in the Taskinen study
. **Shelby Gerking, Ph.D.**  The Taskinen study does not appear to pro vide a direct basis for adding women aged 40

and older to the analy sis. However, relativel y few of these women may seek to become pregnant in a given ye ar. If the analy sis focused on women who seek to become pregnant, exclusion of women over 40 years of age may not be a grave oversight. I would defer to a panel member more knowledgeable about fertility issues to make a judgment on this issue.

**III. SPECIFIC OBSERVATIONS ON THE DOCUMENT**  **NAME COMMENT**  **RESPONSE G** **lenn C.**  **Blomquist, Ph.D. Page 53, bottom.**  $4.9 instead of $4,9.

**Page 56, 3 rd**  **paragraph.** M onetization is misspelled. **Page 58.** V an Houtven and Smith (1999) instead of 1997 and $12,500 instead of $12,50. **Page 59.** Is the probability of obtaining cycle
- based fertility treatment shown in Table 8, the best projection for future treatment? The utilization percentages given on page 916 in Katz et al. seem different. **Page 68.** O’Conor instead of O’Connor. **A. Myrick Freeman III, Ph.D.**  There are a number of t ypographical and editorial errors. This is not a complete list:

**Table of Contents.** P age numbers are wrong. **Page 17.** F igure 2 should be labeled figure 5.94 **Section 3.** Why

do the table and figure numbers start over inste ad of continuing throughout the report? And some of the table numbers se em to be wrong (e.g., J
- 10 on page 36). **Page 6.** T he report gives the aim of developing concentration
- response relationships as being “ ... to inform the economic benefits assessment of potential cost savings ...” This is not about “cost savings;” it is about welfare gains. In some places, coefficients in the concentration
- response relationships are Greek letters. In other places they

are not. **Section 2.1.1, 3 rd**  **sentence in the first paragraph.** N eeds editing. **Page 53.** Where it say s “($93,0 95 + $58, 662 + $90,852= $242,602),” it should be = $242,609. **Page 58.** It say s “willingness to pay of between $3,750 and $12,50 for fertility treatment.” **Page 59.** T he probability of using IVF should be 2.5%, not .25%. **Page 61, last paragraph.** T here are two ref erences to Table 10 , which should be Table 12. **Page 63.** T he sentence, “This is probably the largest category

of value associated fertility issue from a reduction in formaldeh yde exposure,” needs editing. **I have added the following three charge questions based on my expertise in non**  **** **ma rket valuation:**  **(1) Please comment on the validity of the monetization of sensory irritation.** The approach to the monetization of this effect is the same as that used in the First Prospective Section 812 Report. In my

judge ment, this is a valid approach and makes the best use of the available empirical evidence. However, it should be noted that the effect actually valued in the First Prospective Section 812 Report as “Upper Respiratory S ymptoms” defined as “two or more of the following s ymptoms: runny or stuffy nose; coughing; and eye irritation.” Since this document states that formaldehyde can cause a variety of t ypes of95 sensory irritation in the upper respiratory s ys tem (p. 7), this is appropriate. But it should be mad e clear that more than simply eye irritation is involved. **(2) Please comment on the validity of the monetization of chronic asthma.** The approach to the monetization of this effect is the same as that used in the First Prospective Section 812 Report. In my

judgement, this is a valid approach and makes the best use of the available empirical evidence. **(3) Please comment on the validity of the monetization of reduced fertility.** I have serious reservations about the approach taken here to monetize this eff ect. First, “reduced fertility” is not a well
- defined effect. There is ambiguit y as to both the degree of reduction and its duration. This makes determining the proper valuation difficult. I agree that conceptuall y , the willingness to pay (WTP) appro ach is preferable to a cost
- of
illness or cost
- of

- treatment approach. However, as Iread the available WTP studies, they apply to the more serious infertility rather than to the “subfertility” (p. 21) associated with exposure to formaldeh yd e. Thus, the available WTP studies are not suitable for benefits transfer. The report takes a cost of treatment approach to valuation. But it is not at all clear to me that the “cycle
- based treatments” described here are either appropriate treatments or likely to be ef fective in the face of continued formaldehyde exposures. For these reasons, I recommend that this effect be described and quantified to the extent that evidence supports quantification, but that it be acknowledged that there is not an adequate basis for m onetization of this effect. **Shelby Gerking, Ph.D.**  The document appears to have been put together hastily as there are numerous ty pos and other glitches. Below is a list of ty pos that I flagged

— I am certain there are more. **Page 31, first line below eq**  **uatio n (1).**  ...risk reduction at age a. **Page 35, next to last line of third full paragraph.** D ata should be day s **Page 36.** N ot sure wh y the Table is called “Table J
- 10”. Other tables are not numbered96 this way . Also , in this table Dickie et al. needs a date **Page 44, first line under monetization. Analysis should be analyses. Page 45, Table IV.**  2
- 17 not numbered consistently with other tables, also in two places decimal points are mistakenly used for commas **Page 53, last full line.** S hould be $4.9 mi llion **Page 56, eighth line up from bottom.** Undergoes should be undergo **Page 57, fourth full paragraph, first line.** Ryan (1996) conducted a contingent ... **Page 58, first full paragraph, line 4.** Respondents were asked to consider taking... **Page 59, line 8 under equation (19) (and elsewhere).**  The word data is plural, not singular **Page 59, line 12 under equation (19).**  D ifficulty is misspelled **Page 59, second line up from bottom.** R eduction is misspelled **Page 60, part of Table 9 appears to be missing.** A lso, the heading is missing a number for ppb. **Page 60, Table 10.** T he probability values are missing