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Section 301 Investigation: China's Acts, Policies, and Practices Related to Technology 

Transfer, Intellectual Property, and Innovation - Form to Request Exclusion of Product

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Tom Polen 

President & Chief Operating Officer 

BD 

1 Becton Drive 

Franklin Lakes, NJ 07417 

October 9, 2018 

Ambassador Lighthizer 

U.S. Trade Representative 

600 17th St., N.W. 

Washington, DC 20508 

RE: Procedures to Consider Requests for Exclusion of Particular Products from the Determination 

of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related to Technology 

Transfer, Intellectual Property and Innovation: USTR-2018-0025-0001 

HTSUS 9027.90.5650 

Dear Ambassador Lighthizer: 

On behalf of BD (Becton, Dickinson and Company), I hereby submit a request for a product 

specific exclusion of HTSUS item 9027.90.5650 described as an FX40 Control Board, which is a 

printed circuit board assembly with a microcontroller to control blood infection detection 

apparatus of HTSUS subheading 9027.50.40 via a tablet or a similar device. The FX40 Control 

Board is a critical component of both the BD BACTECTM FX Top/Bottom automated blood culture 

instrument and the BD BACTECTM FX40 automated blood culture instrument. The specific product 

at issue is described below in Section III. This request is in response to USTR-2018-0025-0001 

regarding the action pursuant to Section 301: China's Acts, Policies, and Practices Related to 

Technology Transfer, Intellectual Property, and Innovation. 

BD hereby requests business confidential treatment for business proprietary information between 

single brackets in this submission. The disclosure of business proprietary information would 

endanger trade secrets or profitability, and this information would not customarily be released to 

the public. 

 
2

I. Executive Summary 

We request that the FX40 Control Board, which is a printed circuit board assembly with a 

microcontroller to control blood infection detection apparatus of HTSUS subheading 9027.50.40 

via a tablet or a similar device, classified under HTSUS 9027.90.5650, be excluded from the list of 

goods subject to the 25% tariff because of the following. 

 These components are imported into the U.S. where they are further incorporated into 

lifesaving blood infection detection apparatus here in the U.S. 

 This component is only available from a specific Shanghai-based facility in China that 

adheres to BD’s stringent quality standards and has the best processes and practices in 

place to support the needs and requirements of BD. Prior, repeated attempts to identify 

other potential suppliers of this component have been unsuccessful. 

 The additional tariff will cause severe economic harm not only to BD but also to our U.S. 

employees. It will also negatively impact U.S. patient safety and drive up costs at U.S. 

hospitals, including military hospitals and Veterans Affairs (VA) medical centers. 

 This component is not part of China’s 2025 vision or other Chinese industrial programs 

because it is unique only to BD’s manufacturing needs. Since it is imported as a component 

of a medical device, it alone cannot perform any functions that will or could enable the 

Chinese to expropriate it for their Made in China 2025 initiative or any other Chinese 

industrial program. 

II. Overview of BD 

BD was founded in 1897 by two American entrepreneurs who identified a need to bring 

medication delivery devices to the United States. Since that time, BD has grown into one of the 

largest medical technology companies in the world and is advancing the world of health by 

improving medical discovery, diagnostics and the delivery of care. We develop innovative 

technology, services and solutions that help advance both clinical therapy for patients and clinical 

processes for healthcare providers. 

BD is headquartered in New Jersey and has nearly 30,000 associates across all 50 states. BD has 

been manufacturing in the U.S. since 1904, and our 42 U.S. manufacturing facilities are the 

cornerstone of our global manufacturing strategy. We manufacture billions of products in the 
3

U.S. annually that are exported all over the world. On an annual basis, BD invests over $350 

million in capacity and manufacturing new technology in the U.S. These investments include 

manufacturing facility expansions and new construction. 

Our BD BACTECTM automated blood culture instruments (the finished product into which these 

components go) are manufactured in Sparks, Maryland. We are a global leader in the automated 

processing of blood culture patient specimens for the identification of microorganisms in patients 

with sepsis, a life threatening condition caused by the body’s response to an infection, resulting in 

organ dysfunction and failure. 

Launched in 2009 and 2011, respectively, the BD BACTECTM FX Top/Bottom and the BD BACTECTM 

FX40 series of automated blood culture instruments represent the largest diagnostic business 

within the BDDS organization. Through clinical evidence published by the global scientific 

community, the BACTECTM FX instruments offer proven performance in the diagnosis of sepsis. With 

only two major suppliers in the field of automated blood culture, the BD BACTECTM platform, with 

an estimated 60% category share globally, has delivered an estimated one billion blood culture 

results to the global healthcare community. 

III. Specific Product at Issue 

The product subject to this exclusion request is an FX40 Control Board. Specifically, the 

good for which we are seeking an exclusion is: 

Printed circuit board assembly with a microcontroller to control blood infection 

detection apparatus of subheading 9027.50.40 via a tablet or a similar device, weighing 

233 grams and measuring 9.8 X 5.9 inches* classifiable under 9027.90.5650 

*Within normal tolerances of +/- 5% 

This product classified under HTSUS 9027.90.5650 is the FX40 Control Board, a printed circuit board 

assembly to control blood infection detection apparatus of HTSUS subheading 9027.50.40. This 

assembly includes a microcontroller with compiled firmware and circuitry to control the product 

via a tablet PC. Electronic components and connectors are soldered to the printed circuit board 

using lead-free solder. The FX40 Control Board weighs 233 grams and measures 9.842 inches by 

5.906 inches. 

An illustrative picture of an FX40 Control Board is provided below. 
4

 

FX40 Control Board units are manufactured in Shanghai, China, and shipped to BD’s facility in 

Sparks, Maryland, United States, to be assembled into the BD BACTECTM FX Top/Bottom automated 

blood culture instrument and the BD BACTECTM FX40 automated blood culture instrument. The 

FX40 Control Board is a critical component of these instruments, to which they are connected 

mechanically by way of a fastener and electrically by way of connectors on the printed circuit board. 

The BD BACTECTM FX Top/Bottom automated blood culture instrument and the BD BACTECTM FX40 

automated blood culture instrument are designed for the rapid detection of bacteria and fungi in 

clinical specimens. Samples are drawn from patients and injected directly into BD BACTECTM culture 

vials, which are placed into the instruments for incubation and testing. The larger BD BACTECTM FX 

can test 200 samples at one time, with 400 samples in the stacked configuration (top and bottom 

units combined). The BD BACTECTM FX40 is modular and configurable up to four units being 

controlled by a single tablet PC. Each unit can test up to 40 samples for a total of 160 samples at a 

time in the four unit configuration 

Illustrative pictures of the BD BACTECTM FX Top/Bottom automated blood culture instrument and 

the BD BACTECTM FX40 automated blood culture instrument are provided below. 
5

Administrability by U.S. Customs and Border Protection 

U.S. Customs and Border Protection (CBP) will be able to effectively administer and enforce this 

provision due to the nomenclature delineated above and the ability through a simple visual review 

to determine if the FX40 Control Board meets the exclusion request. To further ensure that CBP 

will be able to effectively administer and enforce this provision, BD proposes to update the physical 

description of the FX40 Control Board and to include the approved wording of the exclusion on all 

entry documents. In addition, and should it be necessary, BD would be able to ship the excluded 

units in separate shipments. 

BD will ensure that its invoices reflect the specific terms of the nomenclature and maintain 

substantive and accessible records of import, production and specification standards. BD will 

cooperate with CBP with respect to any request for back-up documentation including requests to 

inspect the imported merchandise and/or the production facility in China. 

Annual Quantities and Value Imported by BD 

 

The annual quantities and value of FX40 Control Board units imported by BD over the past three 

years are shown below. 
6

Period Import Value Import Volume

2017 [ ] [ ]

2016 [ ] [ ]

2015 [ ] [ ]

The Technology and Know-how of Products Embedded in HTSUS 9027.90.5650 Is Not a Priority 

for China’s 2025 Initiative 

Products classified under HTSUS subheading 9027.90.5650 encompass a wide variety of products. 

BD submits that the specific component described above is unique only to BD’s manufacturing 

needs. The FX40 Control Board consists of standard mechanical and electrical components that are 

not considered high-technology, and is designed for a specific BD product that is integrated in the 

U.S. The intellectual property for the product relies on the associated proprietary consumable 

products manufactured in the U.S. as well as protected software algorithms that are part of the 

product software maintained in the U.S. Software and firmware source code is not provided to the 

manufacturer in China. 

The key is the manner in which the FX40 Control Board is assembled and linked together to make 

BD automated blood culture instruments. Therein lies the BD advantage: taking standard 

technology components and assembling them into state-of-the-art medical devices that must 

perform at a very high standard of excellence while conforming to stringent Food and Drug 

Administration (FDA) standards. In so doing, these medical devices play an important role in saving 

lives and improving the overall health of Americans. Because the FX40 Control Board is imported 

as a component of a medical device, it alone cannot perform any functions that will or could enable 

the Chinese to expropriate it for their Made in China 2025 initiative or any other Chinese industrial 

program. 

A Comparable Product is Not Available in the U.S. or a Third Country 

China-based [ ] has been and continues to be BD’s only supplier of FX40 Control Board units. 

Because the medical device industry, and more specifically the in vitro diagnostic blood culture 

industry, are highly regulated by the FDA, a very high level of attention and highly customized 

quality systems are required. BD pursued many projects over the years in an attempt to identify 

alternative suppliers and sourcing options but none of those efforts were successful. A site audit 

conducted by BD’s quality organization on December 8, 2015, demonstrated [ ]’s capacity 

to meet the rigorous quality system and manufacturing requirements set forth by BD. Furthermore, 
7

the FX40 Control Board units purchased from [ ] have been subjected to BD’s 

Verification/Validation and First Article Inspection processes, which prove the units meet BD’s 

specifications and functional requirements. 

Both BD and the [ ] facility are fully compliant with ISO 13485 – Medical devices – Quality 

management systems – Requirements for regulatory purposes. Additionally, the [ ] facility

is fully compliant with ISO 9001:2015 – Quality management systems. Due to the long history of 

collaboration between BD and [ ] quality system and requirements are in sync with BD’s 

stringent requirements. A change to a different supplier would represent a shock to BD’s 

production activities and quality standards. 

The 25% Tariff Will Severely Harm and Undermine BD’s U.S. Manufacturing Competitiveness as 

well as U.S. Patient Safety, and Will Further Drive Up Healthcare Costs 

A 25% additional duty on the BD BACTECTM FX series of automated blood culture instruments is 

expected to increase BDDS’s manufacturing and operational costs by approximately [ ] 

annually, which may require BDDS to make difficult business decisions. 

Currently, the BDDS manufacturing facility in Sparks, Maryland, is the only facility qualified and 

capable of manufacturing the BACTECTM FX series of instruments to BDDS’s specifications. The 

BACTECTM FX instrument series are critical in the diagnosing of sepsis. Globally, an estimated 31.5 

million cases of sepsis are diagnosed each year, with an estimated 5.3 million deaths reported. 

Furthermore, sepsis is a leading cause of mortality and critical illness worldwide, with hospital 

mortality rates ranging from 25% to 30%. To address the health burdens of sepsis, the BACTECTM FX 

instruments allow for processing of clinical blood culture specimens requested by health care 

professionals (doctors, nurses and nurse practitioners) to aid in the diagnosis of sepsis. The blood 

culture specimen remains the most important tool in the management of sepsis. 

Today, a key component of the BACTECTM FX instrument series is supplied by [ ]. If 

implemented, the 25% tariff tax would require BD to source this key raw material through an 

alternative source. Outsourcing this key component through an alternate vendor/source will 

require re-qualification, re-validation and regulatory review, which will impact global registration 

and will compromise our global healthcare community in the treatment of sepsis. 

In addition, the increased tariff costs could result in a loss of business in an internationally 

competitive marketplace. BDDS operates a global distribution network, with 75% of BACTECTM FX 

instruments exported to global distribution channels from the U.S. manufacturing location. Just as 
8

important, the only other main competitor in the supply of automated blood culture instruments 

is based outside the U.S. and may not be as impacted by the tariff. These tariffs place BDDS at a 

significant disadvantage against our foreign competitors today, as well as with potential future 

competitors, which may be able to continue to manufacture and sell products internationally at 

competitive rates. 

Tariffs on FDA-regulated medical devices and their components can significantly raise the overall 

cost of healthcare and disrupt patient access to medical technology. Blood infection detection 

instruments are regulated by the FDA as Class II medical devices and, as such, are subject to 

requirements for pre-market notification (i.e., 510(k)) and clearance. To avoid these tariffs would 

require moving manufacturing of these devices or sourcing components from other suppliers. 

Changes like these require a significant amount of time and expense to implement. Most 

manufacturing and component changes require extensive validations and may require additional 

review by the FDA. Both actions would delay access of these critical medical devices due to the 

duration of validation and length of FDA review. In some cases, these changes could take years and 

cost millions of dollars to implement. 

Additionally, the transition costs for U.S. hospitals out of BACTECTM FX instruments due to product 

shortage or unavailability directly as a result of the 25% tariff will be high, further driving up overall 

healthcare costs, and will also negatively impact the safety of U.S. patients. 

The 25% Tariff Will Cause Severe Economic Harm to BD Employees

Approximately 1,800 people work at BD’s Sparks, Maryland, facility, which is responsible for the 

design and manufacturing of the BD automated blood culture instruments that incorporate as a 

critical component the FX40 Control Board units. If BD does not receive an exclusion as requested, 

employment at the facility could be negatively impacted. These employees’ responsibilities include 

mechanical engineering, electrical engineering, quality engineering, inspection and production. In 

addition, the Sparks, Maryland, facility carries the burden of most manufacturing costs across all 

products manufactured by BD in and around Baltimore. 

SUMMARY 

The imposition of the additional tariff on these items will cause more economic harm to a U.S. 

company and to U.S. workers and patients than it will have any impact on China’s policies and 

practices. These products are INPUTS used for further manufacturing in the United States of critical 

medical devices impacting health of patients and lives. 
9

Therefore, BD submits that the specific product – the FX40 Control Board: 

Printed circuit board assembly with a microcontroller to control blood infection 

detection apparatus of subheading 9027.50.40 via a tablet or a similar device, weighing 233 

grams and measuring 9.8 X 5.9 inches* classifiable under 9027.90.5650 

*Within normal tolerances of +/- 5% 

 be excluded from the additional 25% tariff for the following reasons. 

 These components are imported into the U.S. where they are further incorporated into 

lifesaving medical devices here in the U.S. 

 This component is only available from a specific facility in China that adheres to BD’s 

stringent quality standards and has the best processes and practices in place to support the 

needs and requirements of BD. Prior, repeated attempts to identify other potential 

suppliers of this component have been unsuccessful. 

 The additional tariff will cause severe economic harm not only to BD as a company but also 

to workers at BD’s Sparks, Maryland, facility. It will also negatively impact U.S. patient safety 

and drive up costs at U.S. hospitals, including military hospitals and VA medical centers. 

 This component is not part of China’s 2025 vision or other Chinese industrial programs 

because it is unique only to BD’s manufacturing needs. Since it is imported as a component 

of a medical device, it alone cannot perform any functions that will or could enable the 

Chinese to expropriate it for their Made in China 2025 initiative or any other Chinese 

industrial program. 

Sincerely, 

 

 

Name: Tom Polen 

Title: President & Chief Operating Officer