63372 Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Food and Drug Administration

21 CFR Part 20

[Docket No. 94N–0308]

Public Information; Communications

With State and Foreign Government

Officials

AGENCY: Food and Drug Administration,

HHS.

ACTION: Final rule.

SUMMARY: The Food and Drug

Administration (FDA) is amending its

regulations governing communications

with State and foreign government

officials. This final rule permits FDA to

receive and to disclose nonpublic safety,

effectiveness, or quality information

concerning FDA-regulated products to

State government officials and to receive

or to disclose draft proposed rules and

other nonpublic, predecisional

documents concerning regulatory

requirements or activities to State or

foreign government officials. In both

cases, disclosures to or by State or

foreign government officials would not

require FDA to make the information or

documents available to the public. This

action is necessary to enhance

cooperation in regulatory activities, to

eliminate unwarranted contradictory

regulatory requirements, and to

minimize redundant application of

similar requirements.

EFFECTIVE DATE: January 8, 1996.

FOR FURTHER INFORMATION CONTACT:

Philip L. Chao, Office of Policy (HF–23),

Food and Drug Administration, 5600

Fishers Lane, Rockville, MD 20857,

301–827–3380.

SUPPLEMENTARY INFORMATION:

I. Background

In the Federal Register of January 27,

1995 (60 FR 5530), FDA published a

proposed rule that would enable FDA to

disclose to and receive from State

government officials confidential

commercial information without being

compelled to make that information

available to the general public. The

proposed rule would also enable the

agency to share and to receive

nonpublic documents, such as draft

rules, with State and foreign

government officials. Exchanges of

information, including nonpublic

information, would enhance FederalState cooperation in regulatory

activities, help eliminate unwarranted

contradictory regulatory requirements,

and minimize redundant application of

similar requirements by domestic and

foreign bodies.

The preamble to the proposed rule

described the statutory and regulatory

provisions that had governed FDA’s

communications with State and foreign

government officials. Generally, FDA

has always possessed both statutory and

regulatory authority to withhold some

information from public disclosure. For

example, the Freedom of Information

Act (the FOIA) (5 U.S.C. 552) establishes

categories of information that are

exempt from public disclosure. Such

categories of information relevant to

FDA records include:

1. Trade secret and confidential

commercial information to protect

intellectual property rights and research

incentives (5 U.S.C. 552(b)(4));

2. Predecisional documents to protect

the deliberative process (5 U.S.C.

552(b)(5));

3. Information whose disclosure

might invade personal privacy (5 U.S.C.

552(b)(6)); and

4. Investigatory files compiled for law

enforcement purposes to protect

investigations into violations of the

statutes and regulations FDA enforces (5

U.S.C. 552(b)(7)).

In 1974, FDA issued regulations

implementing the FOIA and other laws

(such as the Trade Secrets Act (18

U.S.C. 1905) and section 301(j) of the

Federal Food, Drug, and Cosmetic Act

(the act) (21 U.S.C. 331(j)) that affect

public access to government records and

information. These regulations included

a provision, now codified in § 20.21 (21

CFR 20.21), stating that any record that

is disclosed in an authorized manner to

any member of the public is available

for disclosure to all members of the

public. When FDA issued § 20.21 in

1974, it expressly declined to make an

exception for records disclosed to

foreign governments, stating that:

The Commissioner concludes that the same

rules will apply with respect to disclosure of

[safety and effectiveness information] to

foreign governments as apply to disclosure to

the public. This will permit the Food and

Drug Administration to provide full

summaries of all safety and effectiveness data

for all approved [new drug applications

(NDA’s)] and selected summaries for

[investigational new drug applications

(IND’s)] and pending NDA’s of which the

existence of an IND has been publicly

disclosed or acknowledged. The

Commissioner concludes that this will

adequately satisfy the need for international

exchange of important regulatory information

of this type.

(See 39 FR 44602 at 44636 and 44637,

December 24, 1974.)

However, since 1974, the regulatory

environment has changed significantly.

Increased international commerce and

diminishing governmental resources

have prompted public health regulatory

agencies, as well as the industries they

regulate, to make efforts to enhance the

effectiveness and efficiency of their

regulatory efforts. Public health

regulatory agencies have engaged in

activities to harmonize regulatory

requirements, minimize duplicative

regulations, and cooperate in joint

scientific, regulatory, and enforcement

endeavors.

For example, FDA is active in a

program known as the International

Conference on Harmonisation of

Technical Requirements for Registration

of Pharmaceuticals for Human Use

(ICH). ICH was organized to provide an

opportunity for harmonization

initiatives to be developed with input

from both regulatory and industry

representatives. ICH is concerned with

harmonization of technical

requirements for the registration of

pharmaceutical products among three

regions: The European Union, Japan,

and the United States. The six ICH

sponsors are the European Commission,

the European Federation of

Pharmaceutical Industry Associations,

the Japanese Ministry of Health and

Welfare, the Japanese Pharmaceutical

Manufacturers Association, FDA, and

the Pharmaceutical Research and

Manufacturers of America. In addition,

the ICH Secretariat, which coordinates

the preparation of documentation, is

provided by the International

Federation of Pharmaceutical

Manufacturers Associations (IFPMA).

The ICH Steering Committee includes

representatives from each organizing

body and IFPMA, as well as observers

from the World Health Organization, the

Canadian Health Protection Branch, and

the European Free Trade Area. The ICH

expert working groups prepare

guidelines on a variety of drug safety,

efficacy, and quality matters, and FDA

publishes these guidelines in the

Federal Register.

Simultaneously, FDA’s interaction

with State agencies has become more

important, particularly as Federal and

State authorities have shared

responsibilities in certain programs and

new authorities have been added. For

example, FDA and other Federal and

State agencies regulate narcotic

treatment program clinics. When new

treatments become available, FDA must

issue or amend its regulations regarding

the new treatment’s use and any special

conditions on the treatment programs

themselves. Yet, State government

agencies may share responsibility for

ensuring that the treatment programs are

licensed and operate in accordance with

the law and regulations. The current
Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations 63373

degree of Federal-State cooperation was

not contemplated back in 1974 when

FDA first issued its public information

regulations. New Federal laws enacted

since 1974 have also emphasized the

importance of Federal-State

cooperation. Statutes such as the

Prescription Drug Marketing Act of

1987, the Nutrition Labeling and

Education Act of 1990, and the

Mammography Quality Standards Act of

1992 have created regulatory schemes in

which the Federal government

establishes programs and standards and

States play a major role in operations

and enforcement.

This final rule is the second initiative

in which FDA has amended its public

information regulations to reflect its

growing involvement in international

activities. In the Federal Register of

November 19, 1993 (58 FR 61598), FDA

published a final rule amending its

regulations governing communications

with foreign officials (hereinafter

referred to as the 1993 final rule). The

1993 final rule, which is now codified

in § 20.89 (21 CFR 20.89), permits FDA,

under certain safeguards, to disclose

confidential commercial information

concerning FDA-regulated products to

foreign government officials who

perform counterpart functions to FDA

‘‘as part of cooperative law enforcement

or regulatory efforts.’’ Those safeguards

include: (1) A written statement from

the foreign government agency

establishing its authority to protect

confidential commercial information

from public disclosure and a written

commitment not to disclose such

information without the sponsor’s

written permission or written

confirmation from FDA that the

information is no longer confidential;

and (2) a determination by FDA that the

sponsor has provided written

authorization for the disclosure,

disclosure would be in the interest of

public health, or disclosure is to a

foreign scientist visiting FDA, on FDA’s

premises, as part of a joint review or

long-term cooperative training effort and

other safeguards. Except in the case of

foreign scientists working on FDA’s

premises, the 1993 final rule did not

authorize disclosure of trade secret

information without written permission

from the person that had submitted the

trade secret information.

The 1993 final rule led the agency to

consider whether the privileges

accorded to foreign government

representatives should be extended to

State and local government officials.

Although States carry out relatively few

product approval programs, they are

significant partners to FDA in such

areas as bioresearch monitoring. The

agency ultimately decided that there are

times when FDA needs to be able to

share confidential commercial

information with State and local

government officials and that, when

FDA grants such access, it should be

subject to the same restrictions and

limitations on disclosure as in cases

where FDA grants foreign government

officials access to confidential

commercial information. Also,

cooperative regulatory activities would

be enhanced if FDA could provide

nonpublic, predecisional documents to

State and foreign counterparts.

Consequently, FDA published a

proposed rule (60 FR 5530) to amend

§ 20.88 (21 CFR 20.88) to: (1) Permit the

agency to disclose confidential

commercial information submitted to

FDA or incorporated into FDA-prepared

records to State government officials,

and (2) disclose to or receive from State

government officials nonpublic

predecisional documents concerning

FDA’s or the State agency’s regulations,

regulatory requirements, or other

nonpublic information. In both cases,

disclosure would be subject to certain

conditions or restrictions, and the

information exchanges would not

require disclosure to the public. For

example, under proposed § 20.88(d),

FDA would be authorized to disclose

confidential commercial information to

State government officials provided

that: (1) The State government agency

has provided a written statement

establishing its authority to protect

confidential commercial information

and a written commitment not to

disclose such information without

written permission from FDA or the

sponsor of the confidential commercial

information; and (2) the agency found

that the sponsor has provided written

permission for the disclosure, disclosure

would be in the interest of the public

health, or disclosure would be to a

visiting State government scientist on

FDA’s premises. (See 60 FR 5530 at

5539.)

The proposed rule would also amend

§ 20.89 to permit FDA to disclose to or

receive from foreign government

officials nonpublic predecisional

documents, provided that certain

conditions (such as provision of a

written statement establishing the

foreign government’s authority to

protect nonpublic documents from

public disclosure) are observed and that

certain findings (such as a finding that

the exchange is ‘‘reasonably necessary

to facilitate global harmonization of

regulatory requirements, cooperative

regulatory activities, or implementation

of international agreements’’) are made.

II. Analysis of the Comments on the

Proposed Rule

FDA received 20 comments on the

proposed rule. Ten comments,

consisting of letters from nine States

and one foreign country, expressed

strong support for the proposed rule. In

general, these comments indicated that

the proposed rule would enhance

intergovernmental relations, help

eliminate redundant regulatory

requirements, permit Federal and State

agencies to respond more quickly to

potential public health problems, and

aid efforts to combat health fraud.

The remaining 10 comments were

sent by individual citizens and firms

and opposed the proposed rule for the

reasons described below. In brief, five

comments opposed withholding

information from the general public

because they saw the proposed rule as

undercutting openness in government,

whereas the other five comments

opposed disclosures because they felt

the proposed rule lacked sufficient

safeguards to prevent State and foreign

government officials from disclosing

confidential commercial information or

trade secrets to third parties.

A. General Comments

1. Two comments commended FDA

for trying to increase intergovernmental

cooperation, but argued that, as FDA is

not involved in matters of national

security or defense, it should not keep

any communications from the public.

The comments asserted that

withholding information from public

disclosure would not benefit the public

and might diminish public and industry

respect for the agency. Similarly, two

other comments argued that the

proposed rule violated the First

Amendment to the U.S. Constitution

because it limited the amount of

information that the public could

examine. The comments stated that the

agency had not justified or shown that

its interest in denying public access to

information exchanged with State and

foreign governments exceeds the

public’s interest in access to that

information.

The agency disagrees with the

comments. The final rule does not in

any way reduce the information in FDA

records that the public can examine.

Section 20.88(d) permits FDA to provide

confidential commercial information to

State government officials. Confidential

commercial information has historically

been exempt from public disclosure

requirements, so FDA’s providing such

information to State government

officials while withholding such

information from the public will not

decrease the amount of information
63374 Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations

available to the public. Sections 20.88(e)

and 20.89(d) pertain to exchanges of

nonpublic, predecisional documents

with State and foreign government

officials. Historically, FDA has generally

withheld these documents from public

disclosure as well.

The agency also disagrees with any

assertion that the final rule violates the

First Amendment. While courts have

construed the First Amendment as

giving the public access to government

proceedings, they have declined to

provide access to all government

operations. Indeed, as the Supreme

Court stated in Press-Enterprise Co. v.

Superior Court of California, 478 U.S. 1,

9 (1986):

Although many governmental processes

operate best under public scrutiny, it takes

little imagination to recognize that there are

some kinds of government operations that

would be totally frustrated if conducted

openly.

In the present case, requiring FDA to

publicly disclose confidential

commercial information and

predecisional documents that it

provides to or receives from State and

foreign governments would frustrate the

final rule’s fundamental purposes. The

final rule is intended to encourage

information exchanges between

governments by assuring State and

foreign governments that the

information or documents they receive

or provide will not be publicly

available. The final rule also reassures

those who submit confidential

commercial information to FDA or to

State or foreign governments that such

information will be protected. If public

access to confidential commercial

information were required whenever

FDA exchanged such information with

a State or foreign government, as the

comments suggest, firms would then be

obliged to refuse requests for

intergovernmental disclosure by FDA,

State governments, or foreign

governments or even refuse to submit

confidential commercial information in

order to protect it.

Additionally, courts have established

a two-part test of ‘‘experience’’ and

‘‘logic’’ to determine whether the First

Amendment requires the governmental

proceeding to be open to the public. The

first part, ‘‘experience,’’ asks whether

the proceeding is one that has

historically been open to the public. The

second part, ‘‘logic,’’ asks whether

public access would play a significant,

positive role in the governmental

process. If the government process

passes these tests, then a qualified First

Amendment right of public access

exists; in other words, the right of

public access is not absolute or

unconditional. (See Press-Enterprise

Co., 478 U.S. 8 and 9; United States v.

Simone, 14 F.3d 833, 837–839 (3d Cir.

1994).)

Applying the two-part test to the final

rule leads to the conclusion that the

First Amendment does not require these

exchanges of information to be open to

the public. Historically, the agency has

always protected confidential

commercial information and indicated

that predecisional documents prepared

by the agency are either not available to

the general public or available under

limited conditions. (See, e.g., 21 CFR

20.61 and 21 CFR 20.62 (nondisclosure

of inter- or intra-agency memoranda or

letters); 21 CFR 20.64 (nondisclosure of

records or information compiled for law

enforcement purposes); 21 CFR 10.80

(establishing conditions for release of

draft notices and regulations).

Additionally, under the second prong,

it is questionable whether public access

would play a significant, positive role in

the governmental process. For example,

intergovernmental exchanges of

confidential commercial information

will enable governments to learn more

about specific products and, as a result,

to develop better and more efficient

regulatory or enforcement actions. At

the same time, disclosure of such

confidential commercial information to

the general public does not further any

regulatory process, and in any event, is

prohibited by 18 U.S.C. 1905. The law

recognizes that public disclosure of

confidential commercial information

may have a detrimental effect on

product development; providing a firm’s

competitors with access to valuable

information may create a disincentive

for firms to develop innovations or

improve their products or methods. The

result would be diminished availability

of useful products.

Furthermore, intergovernmental

exchanges of nonpublic, predecisional

documents may help the agency decide

whether a regulatory approach it is

considering is appropriate or even

necessary. While the agency may, in

many cases, make draft documents

available to the general public (for

example, in the Federal Register of July

24, 1995 (60 FR 37856), FDA published

a notice announcing the availability of

a draft final rule on medical device good

manufacturing practices to members of

the public as well as to State and foreign

regulators), in other cases, providing

public access to predecisional

documents during the deliberative

process could interfere with that process

or create misleading impressions about

the agency’s intentions.

In some cases, premature public

disclosure of draft documents can

unnecessarily complicate regulatory

actions and undermine public health

and safety. For example, if the agency

developed a proposal on a particular

form of tamper evident packaging, such

information could be helpful to other

foreign governments. However,

premature disclosure of that same

information could ultimately prove

harmful to the general public if its

disclosure would enable those who

tamper with products to alter their

methods in order to evade detection or

to defeat the proposed solution.

FDA further emphasizes that, as

stated in the preamble to the proposed

rule, if any State or foreign government

official provides information that the

agency wishes to rely on in its

published proposals or the

administrative record, the agency will

include that information unless

inclusion would harm private or

governmental interests (see 60 FR 5530

at 5538). When a proposed rule is

published, therefore, the general public

would be fully informed and have an

opportunity to comment on the

substance of any advice from State or

foreign officials that FDA incorporated

into the proposed rule.

The agency reiterates that nonpublic

exchanges of information with State and

foreign government officials will not be

a routine occurrence and that FDA does

not intend to prohibit public disclosure

of information received from State and

foreign government officials if such

information can be disclosed without

harm to any private or governmental

interests.

More importantly, the agency believes

that the final rule will result in

significant public benefits because the

final rule facilitates FDA’s access to

information and expertise within State

and foreign governments and should

result in better regulatory proposals and

actions. For example, if FDA and a State

are considering whether to issue

proposed regulations on the same or

similar subjects, exchanging nonpublic,

predecisional documents might lead

both parties to reexamine, modify, or

harmonize their proposed regulatory

strategy. Preventing the issuance of

redundant or unnecessary regulations

should benefit the public and the

affected industries.

2. One comment claimed that the

proposed rule violated the Tenth

Amendment to the Constitution. The

Tenth Amendment states that, ‘‘The

powers not delegated to the United

States by the Constitution, nor

prohibited by it to the States, are

reserved to the States respectively, or to

the people.’’ The comment argued that

the proposed rule violated the Tenth
Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations 63375

Amendment because citizens had not

yielded to the Federal government their

‘‘rights of access to the information

generated by our public servants.’’

The agency disagrees with the

comment. The final rule concerns FDA’s

ability to exchange certain confidential

commercial information or nonpublic,

predecisional documents with State or

foreign government officials. Thus, the

final rule pertains to information

exchange and access to FDA records and

implements Federal authority without

impairing State or popular power.

Indeed, the final rule can strengthen

States’ regulatory roles.

3. Two comments said that the

proposed rule violated procedural due

process because it would give State and

foreign government officials

‘‘preferential access’’ to predecisional

documents, such as draft regulations,

thereby giving those officials ‘‘far greater

influence over the deliberative process

by imparting selected information and

opinion’’ to FDA.

The agency disagrees with the

comments’ assertion. As the Supreme

Court said in Mathews v. Eldridge, 424

U.S. 319, 332 (1976), procedural due

process ‘‘imposes constraints on

governmental decisions which deprive

individuals of ‘liberty’ or property’

interests within the meaning of the Due

Process Clause of the Fifth or

Fourteenth Amendment.’’ However,

‘‘[d]ue process, unlike some legal rules,

is not a technical conception with a

fixed content unrelated to time, place

and circumstances * * * [d]ue process

is flexible and calls for such procedural

protections as the particular situation

demands.’’ Id. p. 334 (citations omitted).

Here, the final rule does not impose

any constraints or sanctions nor does it

deprive individuals of any liberty or

property interest. The final rule does not

‘‘deprive’’ the public of its access to

confidential commercial information or

predecisional documents because such

information has always been protected

from disclosure. Neither does the final

rule deprive the public of the

opportunity to comment on rulemaking.

As stated in the preamble to the

proposed rule:

* * * any information provided by State or

foreign government officials upon which

FDA is relying will be included in published

proposals. At that time, the general public

will be fully informed and have an

opportunity to comment on the substance of

any advice from foreign or State officials that

is incorporated into agency proposals or

initiatives.

(See 60 FR 5530 at 5538.) This approach

is consistent with due process because

‘‘[t]he fundamental requirement of due

process is the opportunity to be heard

‘at a meaningful time and in a

meaningful manner,’’’ Mathews, 424

U.S. 333 (citations omitted).

Moreover, judicial opinions

concerning informal rulemaking have

focused on the need to ensure that ex

parte contacts do not frustrate judicial

review or raise serious questions of

fairness. (See Home Box Office, Inc. v.

FCC, 567 F.2d 9 (D.C. Cir. 1977), cert.

denied 434 U.S. 829, rehearing denied

434 U.S. 988 (1977).) There is no per se

prohibition on ex parte contacts. (See

Action for Children’s Television v. FCC,

564 F.2d 458, 475 n.28 (D.C. Cir. 1977).)

FDA reiterates that it will include in

its published proposals any information

provided by State or foreign government

officials upon which FDA is relying.

The agency will make such information

available at the time of publication.

Thus, the general public will be fully

informed and have an opportunity to

comment on the substance of any advice

from foreign or State officials that is

incorporated into agency proposals or

initiatives. FDA believes this is

consistent with all applicable legal

requirements.

4. Two comments claimed that the

proposed rule violated rights of privacy

and confidentiality because information

supplied to FDA, with the expectation

that the information would remain

confidential, would be eligible for

disclosure to officials outside FDA. The

comments noted that non-FDA officials

may have interests and obligations that

differ from those of FDA, the public, or

the regulated industry. The comments

said that requiring the State or foreign

government to provide a written

statement establishing its authority to

protect confidential commercial

information or nonpublic documents

from public disclosure was ‘‘wholly

inadequate’’ because State and foreign

officials are not subject to FDA’s

management or control. The comments

further asserted that much information

given to FDA is unreliable, fraudulent,

or defamatory and could be used by

outside parties for ulterior purposes and

that the proposed rule would dissuade

submission of confidential information

to FDA and encourage submission of

false information.

Four other comments expressed

similar objections to the proposed rule,

stating that foreign governments might

use confidential commercial

information to benefit their own

industries.

The agency has given serious

attention to the concerns expressed in

the comments, but disagrees that the

safeguards are inadequate. As stated

earlier, FDA issued a final rule on

November 19, 1993, to permit the

agency to disclose confidential

commercial information to foreign

government officials, subject to certain

conditions and safeguards to protect the

confidentiality of the information. Since

issuing that final rule, the agency is

unaware of any misuse or unauthorized

disclosure of confidential commercial

information supplied to a foreign

government. In almost all cases,

disclosure occurred with the knowledge

and consent of the company that

submitted the confidential commercial

information to FDA. Thus, FDA’s

experience with the 1993 final rule

indicates that confidential commercial

information provided to a foreign

government official remains

confidential and is not used to benefit

the foreign government’s industry.

Furthermore, FDA emphasizes that

the decision to share information with

a foreign government is discretionary

and that the agency will deny a foreign

government’s request for confidential

commercial information if the foreign

government officials are unable to

assure FDA of their ability to protect the

information. FDA will also deny access

where there is a lack of scientific data

or regulatory expertise to contribute to

a product review or laboratory or

clinical investigation, unless the foreign

government intends to use the

information for law enforcement

purposes. (See 58 FR 61598 at 61600.)

Similar standards will apply to

exchanges with State governments and

State government officials.

FDA also disagrees with the assertion

that parties often submit false

information to the agency. Submitting

false information to the government is a

Federal crime under 18 U.S.C. 1001.

Submission of false or misleading

reports with respect to medical devices

is prohibited under section 301(q)(2) of

the act (21 U.S.C. 331(q)(2)). Submission

of false information may also lead to

debarment under section 306 of the act

(21 U.S.C. 335a) or assessment of civil

money penalties under section 303(g) or

307 of the act (21 U.S.C. 333(g) or 335b).

FDA has taken legal action against

parties that have submitted false

information to the agency and

emphasizes that it will not tolerate the

submission of false information to the

agency.

5. Two comments asserted that the

proposed rule was contrary to

congressional intent, as expressed in the

FOIA, to provide information to the

public. The comments explained that

the FOIA’s exceptions to disclosure

represented a balance between the

public’s ‘‘right to know’’ and the

government’s interest in not disclosing

certain types of information. Thus, the

comments claimed, only Congress can
63376 Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations

alter that balance. Another comment

claimed that an executive branch agency

cannot withhold information from the

public, stating that only Congress could

authorize such action.

The agency disagrees with the

comments. The preamble to the

proposed rule considered this issue and

explained why the agency believes that

the proposed rule is consistent with the

FOIA. FOIA (5 U.S.C. 552) is a

disclosure statute and its exemptions

are intended to be discretionary. As

stated earlier, those exemptions

establish several categories of

information that can be withheld from

public disclosure. The categories

relevant to FDA include: (a) Trade secret

and confidential commercial

information to protect intellectual

property rights and research incentives

(5 U.S.C. 552(b)(4)); (b) predecisional

documents to protect the deliberative

process (5 U.S.C. 552(b)(5)); (c)

information whose disclosure might

invade personal privacy (5 U.S.C.

552(b)(6)); and (d) investigatory files

compiled for law enforcement purposes

to protect investigations (5 U.S.C.

552(b)(7)).

For disclosures of confidential

commercial information under

§ 20.88(d), the preamble to the proposed

rule explained that the FOIA protects

two broad categories of information

from mandatory public disclosure:

Trade secret information and

‘‘information that is: (1) Commercial or

financial, (2) obtained from a person,

and (3) privileged or confidential

(‘confidential commercial

information’).’’ (See 60 FR 5530 at

5535.) The preamble to the proposed

rule explained that the proposed rule

did not alter agency practice with

respect to protecting trade secret

information (except to permit disclosure

to visiting State scientists) and that

disclosures of confidential commercial

information to State government

officials in accordance with the

conditions of the proposed rule would

not be a public disclosure and would be

‘‘authorized’’ under the Trade Secrets

Act. (See 60 FR 5530 at 5536.)

The preamble to the proposed rule

also explained why the provisions

regarding predecisional documents and

other nonpublic information are

consistent with the FOIA. The preamble

characterized exchanges of nonpublic,

predecisional documents between FDA

and State and foreign governments as

being of the same character as

interagency memoranda and letters that

are exempt from disclosure under the

FOIA. The preamble to the proposed

rule stated that:

* * * it is appropriate to assert the

deliberative process privilege [to disclosure

under the FOIA] in response to requests for

public access to certain communications

from State and foreign government officials

because the same policy reasons that support

nondisclosure of deliberative and

predecisional memoranda generated by

Federal government agencies justify

withholding, in many circumstances, the

advice and recommendations generated for

FDA by State and foreign government

counterparts.

The agency’s ability to make sound

decisions about the development and

implementation of public health and

harmonization initiatives is enhanced by

access to the advice and recommendations of

experts in State and foreign governments

who are engaged in similar efforts in their

own jurisdictions. The agency views this

kind of consultation as functionally

equivalent to the ‘‘intra-’’ or ‘‘interagency’’

deliberation more commonly protected by

exemption 5 of the FOIA. Indeed, it is

frequently the case that advice from a State

or foreign health official whose

responsibilities parallel those of FDA

officials concerning the feasibility of a

particular technical or harmonization

regulation will be as relevant as similar

recommendations solicited from employees

in other Federal government agencies.

(See 60 FR 5530 at 5536 and 5537.) The

preamble to the proposed rule noted

that courts have applied a ‘‘functional’’

test for assessing the applicability of the

exemption for intra- and interagency

memoranda and letters and have

included ‘‘nonagencies’’ within the

exemption. Id.

The preamble also noted that in

circumstances where advice or

information is provided by foreign

governments pursuant to international

agreements that require confidentiality

as a condition of exchange, FDA

believes that a record so provided is not

necessarily an ‘‘agency record’’ subject

to FOIA. Id. at 60 FR 5537 through 5538.

The agency cited recent court decisions

suggesting that FDA could honor

requests for confidentiality under these

circumstances without contravening

public disclosure requirements

established by Congress. Id.

Thus, the final rule is consistent with

the FOIA, and the agency declines to

amend the final rule to require public

access to documents beyond that

required by the FOIA.

6. One comment said that FDA should

discuss the proposed rule’s potential

effects, costs, and implications in a

public forum.

FDA believes that notice and

comment rulemaking has provided a

satisfactory public forum for this issue.

7. Three comments said that FDA

cannot ensure that no unauthorized

disclosures of confidential commercial

information will occur and cannot take

effective action against State or foreign

government officials if unauthorized

disclosures occur. Two comments

added that the agency should describe

how it intends to monitor and

investigate reports of unauthorized

disclosures and take action against those

employees making unauthorized

disclosures. One comment suggested

that FDA establish a mechanism to track

such unauthorized disclosures, analyze

and report any patterns or trends in

unauthorized disclosures, and, if FDA

becomes aware of any unauthorized

disclosures by State or foreign

government officials, notify the

company whose confidential

commercial information was disclosed

and cease information exchanges with

the State or foreign government.

FDA cannot guarantee that no

unauthorized disclosures of confidential

commercial information will ever occur,

but it does note that procedures already

exist for investigating reports of

unauthorized disclosures. In 1994, the

agency created the Office of Internal

Affairs (OIA). OIA consists of one

Special Agent in Charge and a team of

Special Agents. These agents are trained

criminal investigators and report

directly to the Commissioner of Food

and Drugs or the Deputy Commissioner/

Senior Advisor. FDA described OIA’s

functions in a notice published in the

Federal Register of January 23, 1995 (60

FR 4417 and 4418). In brief, OIA:

• Provides a centralized Agencywide

investigative resource for the

Commissioner, the Deputy

Commissioners, and top Agency

management;

• Provides a centralized investigative

liaison between FDA and the Office of

the Inspector General (OIG);

• Serves as an FDA investigative

resource to conduct internal FDA

investigations and to support OIG

investigations; and

OIA is also responsible for investigating

all allegations of misconduct by FDA

employees. (See 59 FR 67087, December

28, 1994.) To assist in this task, the

office uses a data base to track cases by

type of investigation. One investigation

type is ‘‘Unauthorized Release of

Information.’’

Whenever OIA receives any report of

unauthorized disclosures of

information, OIA investigates the report

and works with the OIG where

appropriate. If the investigation suggests

that Federal laws were violated, this

information is presented to the OIG and

may be referred to the Department of

Justice for prosecution. These same

resources and procedures could be

applied, in cooperation with State and
Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations 63377

foreign governments, to allegations of

inappropriate disclosures by their

officials.

Furthermore, when FDA issued the

1993 final rule authorizing disclosure of

confidential commercial information to

foreign government officials, the agency

expressly stated that it would cease

cooperative ventures with any

government that failed to honor its

written commitment to preserve the

confidentiality of the information

provided by FDA. (See 58 FR 61598 at

61603.) The agency will expand this

policy to include State governments.

FDA’s extensive experience sharing

nonpublic investigative records with

State government officials indicates that

unauthorized disclosures are unlikely to

occur and that any State employee

misconduct will be expeditiously

handled in order to preserve cooperative

efforts between FDA and State

governments.

Moreover, after issuing the 1993 final

rule, FDA established internal

procedures and model confidentiality

agreements for disclosures to foreign

government officials. These procedures

will be expanded to apply to State

government officials.

The agency also notes that, contrary to

the comments’ belief that firms and

individuals have no recourse if a foreign

government official makes an

unauthorized disclosure of confidential

commercial information, Federal law

does provide an avenue for relief. Under

section 301 of the Trade Act of 1974 as

amended, the United States Trade

Representative is authorized to take

appropriate action against any act,

policy, or practice of a foreign

government that ‘‘is unjustifiable and

burdens or restricts United States

commerce.’’ (See 19 U.S.C. 2411.) Such

actions can be initiated by a petition to

the United States Trade Representative.

(See 19 U.S.C. 2412.) Additionally, as

previously noted, FDA will not

exchange information with any foreign

government that does not honor its

commitment to protect confidential

commercial information. FDA believes

that the value foreign governments place

on the continuing ability to exchange

information will also help assure that

foreign government officials respect the

confidentiality of information that they

receive.

8. Three comments suggested adding

additional safeguards to proposed

§§ 20.88 and 20.89 to decrease the

likelihood that unauthorized disclosures

of confidential commercial information

would occur. In brief, these comments

would require State and foreign

governments to provide written

assurances that individuals who would

have access to the confidential

commercial information: (1) Will not be

employees, consultants, or persons who

have a professional relationship with a

drug manufacturer; and (2) will be

subject to a confidentiality agreement

and/or appropriate laws and regulations

prohibiting them from disclosing any

information. These comments also

would require both FDA and the firm

that had submitted the confidential

commercial information to FDA to

consent, in writing, to any release or

disclosure by the State or foreign

government.

Under § 20.88(d)(1)(i), a State

government agency must provide a

written statement establishing its

authority to protect confidential

commercial information from public

disclosure. FDA will supplement this

requirement with guidance to States on

conflicts of interest and prohibitions

against further disclosure.

FDA declines to amend the final rule

to require the agency and the party

submitting the confidential commercial

information to consent to any release or

disclosure by the State or foreign

government. This final rule and the

1993 final rule governing disclosures of

confidential commercial information to

foreign government officials already

provide for written consent by the party

submitting the confidential commercial

information (see § 20.88(d)(1)(i); see also

§ 20.89(c)(1)(i)) or written permission

from FDA before the State or foreign

government can make any disclosure.

Thus, these rules already would require

a State or foreign government to obtain

written authorization from the party that

submitted the confidential commercial

information, or written confirmation

from FDA that the information was no

longer confidential. The comments’

suggested changes, therefore, are

unnecessary.

As for disclosures to foreign

government officials, since amending

§ 20.89 in 1993 to allow FDA to disclose

confidential commercial information to

foreign government officials, the agency

has not received any reports of

unauthorized disclosures by foreign

government officials. The agency

acknowledges that, in some cases, firms

have requested additional safeguards,

similar to those mentioned in the

comments, and that the foreign

government officials have consented to

such additional safeguards. However,

FDA’s experience under § 20.89 does

not indicate that such additional

safeguards are necessary.

9. One comment would expand

§§ 20.88 and 20.89 so that they applied

to State and foreign government officials

and ‘‘all agents contracted by them for

any part of the review and approval

processes involving confidential and

trade secret information.’’ The comment

would also have State and foreign

government officials and agents subject

to the same confidentiality restrictions

as FDA employees.

The agency agrees with the comment

and has amended §§ 20.88(e)(3) and

20.89(d)(3) so that references to State or

foreign government officials are

understood to include agents contracted

by those officials.

10. The agency, on its own initiative,

has amended §§ 20.88(e) and 20.89(d) to

permit the Deputy Commissioner for

Policy to authorize disclosures of

nonpublic, predecisional documents to

State or foreign government officials.

The Deputy Commissioner for Policy is

authorized, under 21 CFR 5.20(f), to

perform any of the functions of the

Commissioner of Food and Drugs with

respect to the issuance of notices,

proposed rules, and final rules.

11. FDA, on its own initiative, has

also amended the authority citation to

include a reference to the Pesticide

Monitoring Improvements Act of 1988

(21 U.S.C. 1401–1403). FDA has taken

this action because that statute provides

for cooperative agreements between

FDA and foreign governments and

exchanges of certain information

between FDA and States.

B. Section 20.88—Communications

With State and Local Government

Officials

12. Proposed § 20.88(d)(1)(i) would

require, as a condition of authorizing

disclosure of confidential commercial

information to a State government

official, a written statement from the

State government agency ‘‘establishing

its authority to protect confidential

commercial information from public

disclosure and a written commitment

not to disclose any such information’’

without the sponsor’s written

permission or FDA’s written

confirmation that the information was

no longer confidential. One comment

would require that State agencies

provide written assurance that,

notwithstanding their own State laws,

the State agency would protect any

confidential commercial information

that it received ‘‘in accordance with

Federal law and FDA regulations.’’

FDA sees no need to amend the final

rule as suggested by the comment. FDA

would not disclose confidential

commercial information to a State

government official unless State laws

allow adequate protection of that

information.

13. One comment would require FDA

to notify and to obtain written consent
63378 Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations

from a party before disclosing

confidential commercial information to

State government officials. The

comment would have the notice

describe the information to be disclosed

or provide sufficient detail to permit the

party to decide whether to withhold

permission for disclosure. The comment

would also restrict any permission to

disclose confidential commercial

information to the specific request.

As stated elsewhere in this document,

FDA intends, in most cases, to seek

written approval from a party before

disclosing confidential commercial

information. However, the agency

declines to require such written

approval in all cases because there are

situations, such as enforcement actions,

where it would be inappropriate to

require written approval prior to

disclosure.

The agency does agree, however, that

a party’s written authorization to

disclosure of confidential commercial

information is limited to a specific

request to disclose information and does

not constitute automatic authorization

to disclose the information to any

subsequent State government official

seeking to obtain that information. (See

58 FR 61598 at 61602 (stating that ‘‘in

general, the sponsor needs to authorize

further disclosure of confidential

information’’).)

14. Proposed § 20.88(d)(1)(ii)(A)

would authorize disclosure of

confidential commercial information if

disclosure would be ‘‘in the interest of

the public health by reason of the State

government’s possessing information

concerning the safety, effectiveness, or

quality of a product or information

concerning an investigation, or by

reason of the State government being

able to exercise its regulatory authority

more expeditiously’’ than FDA. One

comment objected to this provision,

arguing that it provided ‘‘no objective

criteria for determining when the

disclosure of confidential commercial

information would be in the interest of

public health.’’ The comment claimed

that the agency had not shown the State

commissioned officials program to be

inadequate, that the provision gave no

‘‘clear, objective standards outlining the

procedure for allowing disclosure,’’ and

that the proposed rule would operate in

an arbitrary and capricious fashion.

The agency declines to amend the

final rule to provide the ‘‘objective

criteria’’ requested by the comment. It

would be extremely difficult, if not

impossible, to draft objective criteria

that would encompass all instances

where disclosure of confidential

commercial information would be in the

interest of public health, and any

‘‘objective’’ regulatory criteria would

invite parties to dispute the

applicability of a particular criterion

instead of examining public health

concerns and would prevent the final

rule from operating in a flexible manner.

FDA further notes that the phrase

‘‘interest of public health’’ is modified

by two criteria. Under

§ 20.88(d)(1)(ii)(B), disclosure would be

in the interest of public health: (1) By

reason of the State government’s

possessing information concerning the

safety, effectiveness, or quality of a

product or information concerning an

investigation; or (2) by reason of the

State government being able to exercise

its regulatory authority more

expeditiously than FDA. Thus,

§ 20.88(d)(1)(ii)(B) contemplates

disclosures in the interest of public

health if a State government possesses

information about a product or an

investigation or can exercise regulatory

authority in a particular situation more

quickly than FDA; the provision does

not permit unconditional or unrestricted

exchanges of confidential commercial

information. As stated in the preamble

to the proposed rule, disclosures to

State governments will not be a routine

occurrence, but would occur only in

limited situations and on a case-by-case

basis. (See 60 FR 5530 at 5535.)

As for the comment claiming that the

agency had not shown the

commissioned officials program to be

inadequate, the preamble to the

proposed rule described the

commissioning process for State

government officials and explained why

commissioned officials might not

always be the best or most appropriate

persons to receive the types of

confidential commercial information or

nonpublic, predecisional documents

contemplated by the rule. In brief,

section 702(a) of the act (21 U.S.C.

372(a)) authorizes FDA to conduct

examinations and investigations

through employees of the Department of

Health and Human Services (HHS) or

through any health, food, or drug officer

or employee of any State, territory, or

political subdivision commissioned as

an officer of HHS. (See 60 FR 5530 at

5531.) State or local government

officials commissioned under this

program have a status with respect to

disclosure of FDA records that permits

the commissioned official to review

confidential investigative files and

proposed policy statements that are

normally restricted to Federal

employees. Thus, FDA can solicit

advice from these commissioned

officials without public disclosure.

The commissioning process, however,

is too cumbersome to be practical in the

situations that led FDA to issue the

proposed rule. A commissioned official

is authorized to perform one or more of

the following functions: (1) Conduct

examinations, inspections, and

investigations under the act; (2) collect

and obtain samples; (3) copy and verify

records; and (4) receive and review

official FDA documents. (See Regulatory

Procedures Manual, chapter 3 (regarding

commissioning State and local

officials).) A commissioned official is

only authorized to review FDA

documents that fall within the scope of

his or her commission; the official may

not necessarily have authorized access

to all the information that the agency

may need to convey to the State.

Yet, even if commissioning a State

government official would enable an

official to review FDA documents, such

authority would not eliminate the need

for the final rule. Commissioning a State

government official does not confer any

protection to documents supplied by a

State government to FDA, whereas

§ 20.88(e) authorizes the agency to

receive nonpublic, predecisional

documents from State government

officials and to protect those documents

from public disclosure. Similar

provisions in documents provided to

FDA by foreign government officials are

set forth in § 20.89(d). If information

exchanges are to be valuable and

meaningful, the agency must be able to

protect State or foreign government

documents that it receives, as well as

the documents that it sends, and the

final rule provides such protection to

information that FDA receives.

Additionally, as stated in the

preamble to the proposed rule, the

commissioning process cannot be easily

adapted for situations requiring rapid

exchange of information. (See 60 FR

5530 at 5532.) The process involves

identifying suitable candidates (and

often requires commissioning the

candidates’ supervisors or State agency

heads as well), reviewing the

candidates’ qualifications, conducting

background checks (if necessary),

issuing certificates and credentials, and

accounting for credentials on a periodic

basis. These procedures, even if they

were as streamlined as possible, might

be both impractical and unnecessary in

situations where rapid information

exchanges are necessary. Consequently,

the agency believes that the final rule

gives FDA needed authority to exchange

information both quickly and efficiently

in situations when reliance on

commissioned officials would prove

impractical.

15. Two comments would amend

proposed § 20.88(d)(1)(ii)(C) to add new

requirements to deter unauthorized
Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations 63379

disclosures of information. The

comments would require visiting State

scientists to confirm that they are not

employees, consultants, or persons that

have any professional relationship with

a drug manufacturer and to provide a

written commitment not to release or

disclose information without approval

from FDA and the party submitting the

confidential commercial information.

The comments would not permit FDA to

authorize disclosures unilaterally.

FDA declines to revise the final rule

as suggested by the comments. Section

20.88(d)(1)(ii)(C) already contains

sufficient safeguards that accomplish

the same purpose as those suggested by

the comments. For example, the final

rule requires a visiting State government

scientist to provide a written assurance

that he or she ‘‘has no financial interest

in the regulated industry of the type that

would preclude participation in the

review of the matter if the individual

were subject to the conflict of interest

rules applicable to the Food and Drug

Administration advisory committee

members under 21 CFR 14.80(b)(1).’’

Under § 14.80(b)(1), advisory committee

members are subject to Federal conflict

of interest laws and regulations. A

visiting State government scientist,

therefore, could not truthfully provide

the written assurance required under

§ 20.88(d)(1)(ii)(C) if he or she were an

employee or consultant of a drug

manufacturer.

FDA also declines to amend the final

rule to prevent FDA from authorizing

disclosure of confidential commercial

information or trade secrets to a visiting

State government scientist. Section

20.88(d)(1)(ii)(C) authorizes disclosure

to a visiting State government scientist

if, among other things: (1) The visiting

State government scientist signs a

written commitment to protect the

confidentiality of the information; (2)

the visiting State government scientist

provides written assurance that he or

she has no financial interest in the

regulated industry of the type that

would preclude participation in review

of the matter if the visiting State

government scientist were subject to

FDA’s conflict of interest rules; and (3)

FDA retains physical control over the

information. The agency believes that

these safeguards provide sufficient

protection to confidential commercial

and trade secret information in FDA’s

possession. The agency further notes

that a similar regulation has existed for

visiting foreign government scientists

since 1993, and the agency has not

experienced any difficulties or problems

with confidential commercial or trade

secret information disclosed to visiting

foreign government scientists.

16. One comment said that firms that

submitted confidential commercial

information should have the

opportunity to purge ‘‘highly

confidential’’ information before

disclosure to State government officials.

The comment explained that this would

enable firms to discuss why FDA should

not release certain information to a State

government official.

The agency wishes to reassure

regulated firms about its concerns for

proprietary information, but declines to

accept the comment’s suggestion. While

FDA intends, in most cases, to seek a

firm’s approval before disclosing

confidential commercial information,

there are situations where it would be

inappropriate to permit firms to purge

information before its release to State

government officials. For example, if

confidential commercial information in

a marketing application indicated that a

firm might have engaged in fraud or

misrepresentation that violated both

State and Federal laws, the agency

might want to notify its State

government counterparts. Permitting a

firm to purge that information before its

release to a State government official

would defeat any State regulatory

action. Consequently, the agency

declines to amend the final rule as

suggested by the comment.

C. Section 20.89—Communications

With Foreign Government Officials

17. One comment from a foreign

government official supported proposed

§ 20.89(d) but asked whether FDA

would protect the confidentiality of

nonpublic, predecisional documents

provided by a foreign government.

Section 20.89(d) authorizes the

agency to disclose and to receive

nonpublic, predecisional documents to

or from foreign government officials.

Under § 20.89(d)(2), such documents

would not be made available to all

members of the public. Thus, FDA

would maintain the confidentiality of

nonpublic, predecisional documents

supplied by a foreign government

official. The basis for this position is

explained in detail in the preamble to

the proposed rule (60 FR 5530 at 5536

and 5538).

18. Four comments suggested that

FDA either permit firms that submitted

the confidential commercial information

to purge those records before their

release or to decide whether release

should occur, or provide summaries to

firms regarding the information

disclosed to the foreign government.

The agency addressed similar

comments when it issued the 1993 final

rule permitting FDA to disclose

confidential commercial information to

foreign government officials. The

preamble to the 1993 final rule stated

that: (1) Any disclosure would be on a

case-by-case basis under assurances of

continuing confidentiality; (2) the

agency will, in most circumstances, seek

written authorization from the party

submitting the confidential commercial

information to permit disclosure; and

(3) there are situations where it would

be inappropriate to require consent from

a party that submitted confidential

commercial information. (See 58 FR

61598 at 61601.)

The same rationale applies here. FDA

reiterates that the final rule authorizes

disclosure only to those governments

that have provided written assurances

that they have the authority to protect

confidential commercial information

and nonpublic, predecisional

documents from public disclosure and

that they will not disclose such

documents or information without the

written permission of the sponsor or

written confirmation from FDA that the

information or documents are no longer

confidential. Additionally, in most

cases, FDA intends to seek written

consent from the party that submitted

the confidential commercial information

before disclosing that information. To

permit parties to purge information

would lessen the utility of any

information provided to a State or

foreign government and invite such

governments to withhold information

themselves.

Requiring FDA to give parties

summaries of information disclosed to a

State or foreign government would also

be inappropriate or unnecessary. For

example, if a State or foreign

government were considering whether

to take action against a particular

product, requiring FDA to provide a

summary to the product’s manufacturer

would alert a violative firm of the

potential enforcement action. In an

action to help a government identify

fraudulent goods, the agency might wish

to provide confidential commercial

information that would help distinguish

legitimate products from fraudulent

ones; in such a scenario, providing a

summary to the product’s manufacturer

would be worthless because the

manufacturer would already know the

information that was the basis of the

summary. Thus, the agency declines to

accept the comments’ suggestions.

19. Proposed § 20.89(d)(1)(i) would

require, as a condition to authorizing

disclosure of confidential commercial

information to a foreign government

official, a written statement from the

foreign government establishing its

authority to protect nonpublic

documents from public disclosure and a
63380 Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations

written commitment not to disclose any

such documents without FDA’s written

confirmation that the information was

no longer confidential. One comment

would limit disclosures to foreign

government officials whose countries

‘‘can reasonably be expected to maintain

confidentiality and patent protection at

the level acceptable under U.S.

intellectual property protection

agreements with foreign nations.’’ If the

agency could not determine whether the

foreign country offered ‘‘acceptable’’

protection, the comment said that FDA

should be required to consult the firm

that submitted the confidential

commercial information regarding that

firm’s prior experience with intellectual

property protection in the foreign

country.

Although this comment pertains to

the rulemaking completed in 1993

rather than the present final rule and is

outside the scope of this rulemaking, the

agency considered similar comments in

1993 when it issued a final rule

authorizing the disclosure of

confidential commercial information to

foreign government officials. The

comments asked FDA to restrict

disclosures to countries with similar

product approval processes or to list

foreign governments ‘‘that have been

designated as appropriate for the

sharing of confidential information.’’

(See 58 FR 61598 at 61602.) The agency

declined to accept the comments’

recommendations, stating that a list of

foreign countries would not be useful,

repeating that disclosures were subject

to certain safeguards, and stating that,

‘‘in every case disclosure is at the

discretion of the agency and cannot be

automatic for any country.’’ Id. The

same rationale applies here. FDA will

decide, on a case-by-case basis, whether

to disclose confidential commercial

information to a foreign government

and, in most cases, will seek written

permission from the party that

submitted the confidential commercial

information. Given these safeguards,

there is no need to establish a list of

countries that would protect intellectual

property to an ‘‘acceptable’’ or

‘‘appropriate’’ level. Additionally,

because most disclosures would be

preceded by written approval from the

party submitting the confidential

commercial information, there is no

need to amend the final rule to require

prior consultation with the party that

submitted the confidential commercial

information.

20. One comment said that proposed

§ 20.89 would delay public participation

in reviewing or commenting on

predecisional documents and permit

public comment ‘‘only after the agency

has more invested in its own

viewpoint.’’

The agency disagrees with the

comment. The agency believes that

exchanges of nonpublic, predecisional

documents with State and foreign

government officials will neither

significantly delay public review of

such documents nor make any public

review less meaningful. FDA will be just

as interested in hearing what the public

thinks about a proposal, whether or not

that proposal was previously shared

with a regulatory counterpart. Nor will

the agency’s obligation to consider or

respond to public comments in any way

diminish because of this rule.

FDA stresses that the purpose behind

exchanging nonpublic, predecisional

documents is not to diminish the role of

any participant in rulemaking, but to

enhance Federal-State uniformity and

facilitate global harmonization of

regulatory requirements. Although FDA

often considers State or foreign

regulatory requirements when drafting

its own predecisional documents,

mutual exchanges between FDA and a

State or foreign government will enable

refinements in the documents to

account for new requirements or

developments. The agency believes that,

in most cases, the changes that would be

made would probably be minor

technical adjustments or revisions to a

document before publication or release,

but, in any event, there should be no

significant delay in publication for

general review and comment.

The final rule also promotes

efficiency during any public review

period. Mutual exchanges between FDA

and State or foreign governments should

result in documents that reflect greater

consideration of State or foreign

requirements and resources, thereby

reducing the possibility that the agency

would have to substantially revise or

even repropose a proposed regulatory

approach due to an inconsistent or

conflicting State or foreign requirement

identified by comments submitted

during a comment period. For example,

providing a nonpublic, predecisional

document to State governments could

alert FDA that its proposed enforcement

scheme would overly burden State

resources; FDA could then revise the

enforcement scheme and publish or

release a document that contained the

revised enforcement scheme. FDA also

reiterates that any document that it

publishes in the Federal Register will

inform the public of any information

from State or foreign government

officials that affected the document and

provide an opportunity for public

comment.

In contrast, if FDA cannot exchange a

nonpublic, predecisional documents

with State governments, the agency may

publish a document proposing an

enforcement scheme that places

unrealistic burdens on State

governments, await comments, publish

a second document proposing a revised

enforcement scheme, await comments

again, and then issue a final document.

Under this scenario, public

participation might occur earlier, but

final action on the initiative would

occur later, with attendant delays to the

program in question and waste of public

resources.

III. Description of the Final Rule

Section 20.88(d) of the final rule

authorizes FDA to disclose confidential

commercial information submitted to

FDA or incorporated into FDA-prepared

records to State government officials as

part of cooperative law enforcement or

regulatory efforts, provided that: (1) The

State government agency has provided a

written statement establishing its

authority to protect the information

from public disclosure and has provided

a written commitment not to disclose

such information without the sponsor’s

written permission or written

confirmation from FDA that the

information is no longer confidential;

and (2) FDA has determined that the

sponsor has consented, in writing, to

disclosure, disclosure would be in the

interest of public health, or disclosure

would be to a visiting State scientist,

subject to certain additional conditions

(such as a written assurance that the

visiting State scientist has no financial

interest in the regulated industry that

would preclude him or her from

participating in the matter under

review). Information exchanged under

§ 20.88(d) would not be available to the

public.

Sections 20.88(e) and 20.89(d) permit

the agency to disclose or to receive

nonpublic, predecisional documents to

or from State or foreign government

officials as part of efforts to improve

intergovernmental cooperation and

uniformity or to implement

intergovernmental agreements. The

disclosure or receipt of nonpublic,

predecisional documents is subject to

two conditions: (1) The State or foreign

government agency has provided a

written statement establishing its

authority to protect nonpublic

documents from public disclosure and

has provided a written commitment not

to disclose such documents without

FDA’s written confirmation that the

information no longer has nonpublic

status; and (2) the agency has

determined that exchange is reasonably
Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations 63381

necessary to cooperative regulatory

activities or to improve Federal-State

uniformity or to facilitate international

harmonization of regulatory

requirements. Information exchanged

under §§ 20.88(e) or 20.89(d) will not be

available to the public.

IV. Environmental Impact

The agency has determined under 21

CFR 25.24(a)(8) that this action is of a

type that does not individually or

cumulatively have a significant effect on

the human environment. Therefore,

neither an environmental assessment

nor an environmental impact statement

is required.

V. Analysis of Impacts

FDA has examined the impacts of the

final rule under Executive Order 12866

and the Regulatory Flexibility Act (Pub.

L. 96–354). Executive Order 12866

directs agencies to assess all costs and

benefits of available regulatory

alternatives and, when regulation is

necessary, to select regulatory

approaches that maximize net benefits

(including potential economic,

environmental, public health and safety,

and other advantages; distributive

impacts; and equity). The agency

believes that this final rule is consistent

with the regulatory philosophy and

principles identified in the Executive

Order. In addition, the final rule is not

a significant regulatory action as defined

by the Executive Order and so is not

subject to review under the Executive

Order.

The Regulatory Flexibility Act

requires agencies to analyze regulatory

options that would minimize any

significant impact of a rule on small

entities. Because the final rule promotes

harmonized regulatory requirements,

nationally and internationally, thereby

reducing disparate regulatory

requirements, the agency certifies that

the final rule will not have a significant

economic impact on a substantial

number of small entities. Therefore,

under the Regulatory Flexibility Act, no

further analysis is required.

List of Subjects in 21 CFR Part 20

Confidential business information,

Courts, Freedom of information,

Government employees.

Therefore, under the Federal Food,

Drug, and Cosmetic Act and under

authority delegated to the Commissioner

of Food and Drugs, 21 CFR part 20 is

amended as follows:

PART 20—PUBLIC INFORMATION

1. The authority citation for 21 CFR

part 20 is revised to read as follows:

Authority: Secs. 201–903 of the Federal

Food, Drug, and Cosmetic Act (21 U.S.C.

321–393); secs. 301, 302, 303, 307, 310, 311,

351, 352, 354–360F, 361, 362, 1701–1706,

2101 of the Public Health Service Act (42

U.S.C. 241, 242, 242a, 242l, 242n, 243, 262,

263, 263b–263n, 264, 265, 300u–300u–5,

300aa–1); 5 U.S.C. 552; 18 U.S.C. 1905; 19

U.S.C. 2531–2582; 21 U.S.C. 1401–1403.

2. Section 20.88 is amended by

adding new paragraphs (d) and (e) to

read as follows:

§ 20.88 Communications with State and

local government officials.

* * * * *

(d)(1) The Commissioner of Food and

Drugs, or any other officer or employee

of the Food and Drug Administration

whom the Commissioner may designate

to act on his or her behalf for the

purpose, may authorize the disclosure

of confidential commercial information

submitted to the Food and Drug

Administration, or incorporated into

agency-prepared records, to State

government officials as part of

cooperative law enforcement or

regulatory efforts, provided that:

(i) The State government agency has

provided both a written statement

establishing its authority to protect

confidential commercial information

from public disclosure and a written

commitment not to disclose any such

information provided without the

written permission of the sponsor or

written confirmation by the Food and

Drug Administration that the

information no longer has confidential

status; and

(ii) The Commissioner of Food and

Drugs or the Commissioner’s designee

makes one or more of the following

determinations:

(A) The sponsor of the product

application has provided written

authorization for the disclosure;

(B) Disclosure would be in the interest

of public health by reason of the State

government’s possessing information

concerning the safety, effectiveness, or

quality of a product or information

concerning an investigation, or by

reason of the State government being

able to exercise its regulatory authority

more expeditiously than the Food and

Drug Administration; or

(C) The disclosure is to a State

government scientist visiting the Food

and Drug Administration on the

agency’s premises as part of a joint

review or long-term cooperative training

effort authorized under section 708 of

the Federal Food, Drug, and Cosmetic

Act (the act), the review is in the interest

of public health, the Food and Drug

Administration retains physical control

over the information, the Food and Drug

Administration requires the visiting

State government scientist to sign a

written commitment to protect the

confidentiality of the information, and

the visiting State government scientist

provides a written assurance that he or

she has no financial interest in the

regulated industry of the type that

would preclude participation in the

review of the matter if the individual

were subject to the conflict of interest

rules applicable to the Food and Drug

Administration advisory committee

members under § 14.80(b)(1) of this

chapter. Subject to all the foregoing

conditions, a visiting State government

scientist may have access to trade secret

information, entitled to protection

under section 301(j) of the act, in those

cases where such disclosures would be

a necessary part of the joint review or

training.

(2) Except as provided under

paragraph (d)(1)(ii)(C) of this section,

this provision does not authorize the

disclosure to State government officials

of trade secret information concerning

manufacturing methods and processes

prohibited from disclosure by section

301(j) of the act, unless pursuant to an

express written authorization provided

by the submitter of the information.

(3) Any disclosure under this section

of information submitted to the Food

and Drug Administration or

incorporated into agency-prepared

records does not invoke the rule

established in § 20.21 that such records

shall be made available to all members

of the public.

(e)(1) The Deputy Commissioner for

Policy, or any other officer or employee

of the Food and Drug Administration

whom the Deputy Commissioner for

Policy may designate to act on his or her

behalf for the purpose, may authorize

the disclosure to, or receipt from, an

official of a State government agency of

nonpublic, predecisional documents

concerning the Food and Drug

Administration’s or the other

government agency’s regulations or

other regulatory requirements, or other

nonpublic information relevant to either

agency’s activities, as part of efforts to

improve Federal-State uniformity,

cooperative regulatory activities, or

implementation of Federal-State

agreements, provided that:

(i) The State government agency has

provided both a written statement

establishing its authority to protect such

nonpublic documents from public

disclosure and a written commitment

not to disclose any such documents

provided without the written

confirmation by the Food and Drug

Administration that the documents no

longer have nonpublic status; and
63382 Federal Register / Vol. 60, No. 236 / Friday, December 8, 1995 / Rules and Regulations

(ii) The Deputy Commissioner for

Policy or the Deputy Commissioner for

Policy’s designee makes the

determination that the exchange is

reasonably necessary to improve

Federal-State uniformity, cooperative

regulatory activities, or implementation

of Federal-State agreements.

(2) Any exchange under this section

of nonpublic documents does not

invoke the rule established at § 20.21

that such records shall be made

available to all members of the public.

(3) For purposes of this paragraph, the

term ‘‘official of a State government

agency’’ includes, but is not limited to,

an agent contracted by the State

government, and an employee of an

organization of State officials having

responsibility to facilitate

harmonization of State standards and

requirements in FDA’s areas of

responsibility. For such officials, the

statement and commitment required by

paragraph (e)(1)(i) of this section shall

be provided by both the organization

and the individual.

3. Section 20.89 is amended by

adding new paragraph (d) to read as

follows:

§ 20.89 Communications with foreign

government officials.

* * * * *

(d)(1) The Deputy Commissioner for

Policy, or any other officer or employee

of the Food and Drug Administration

whom the Deputy Commissioner for

Policy may designate to act on his or her

behalf for the purpose, may authorize

the disclosure to, or receipt from, an

official of a foreign government agency

of nonpublic, predecisional documents

concerning the Food and Drug

Administration’s or the other

government agency’s regulations or

other regulatory requirements, or other

nonpublic information relevant to either

agency’s activities, as part of

cooperative efforts to facilitate global

harmonization of regulatory

requirements, cooperative regulatory

activities, or implementation of

international agreements, provided that:

(i) The foreign government agency has

provided both a written statement

establishing its authority to protect such

nonpublic documents from public

disclosure and a written commitment

not to disclose any such documents

provided without the written

confirmation by the Food and Drug

Administration that the documents no

longer have nonpublic status; and

(ii) The Deputy Commissioner for

Policy or the Deputy Commissioner for

Policy’s designee makes the

determination that the exchange is

reasonably necessary to facilitate global

harmonization of regulatory

requirements, cooperative regulatory

activities, or implementation of

international agreements.

(2) Any exchange under this section

of nonpublic documents does not

invoke the rule established in § 20.21

that such records shall be made

available to all members of the public.

(3) For purposes of this paragraph, the

term ‘‘official of a foreign government

agency’’ includes, but is not limited to,

an agent contracted by the foreign

government, and an employee of an

international organization having

responsibility to facilitate global

harmonization of standards and

requirements in FDA’s areas of

responsibility. For such officials, the

statement and commitment required by

paragraph (d)(1)(i) of this section shall

be provided by both the organization

and the individual.

Dated: November 30, 1995.

William B. Schultz,

Deputy Commissioner for Policy.

[FR Doc. 95–29904 Filed 12–7–95; 8:45 am]

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