12850 Federal Register / Vol. 66, No. 41 / Thursday, March 1, 2001 / Rules and Regulations

conversations will be included on an

optional basis and meetings with the

working press, except for ‘‘house

organs’’ (i.e., publications of firms that

manufacture or distribute regulated

products, or industry associations), and

with on-site contractors will not be

included. Meetings with members of the

judiciary, representatives of Congress, or

staffs of congressional committees will

be included when the meeting relates to

a pending court case, administrative

hearing, or other regulatory action or

decision and involves more than a brief

description of the matter.

(2) The calendar will include all

meetings, conferences, seminars, social

events sponsored by the regulated

industry, and speeches. The calendar

will specify the date and the person and

subject matter involved. When more

than one FDA representative is in

attendance, only the presiding or head

representative will report the meeting

on the public calendar. If a large number

of persons is involved, the name of each

need not be specified. Meetings that

would prejudice law enforcement

activities (e.g., a meeting with an

informant) or invade privacy (e.g., a

meeting with a candidate for possible

employment in FDA) will not be

reported.

(3) The following FDA representatives

and their deputies are subject to the

requirements of paragraphs (b)(1) and

(2) of this section:

(i) Commissioner of Food and Drugs.

(ii) Deputy Commissioner.

(iii) Associate Commissioners.

(iv) Executive and Special Assistants

to the Commissioner.

(v) [Reserved]

(vi) Director, National Center for

Toxicological Research.

(vii) Center Directors.

(viii) Chief Counsel for the Food and

Drug Administration, or any

representative of that office attending on

behalf of the Chief Counsel.

(4) A copy of the public calendar will

be placed on public display in the

following places:

(i) Dockets Management Branch.

(ii) Office of the Associate

Commissioner for Public Affairs.

(iii) A central place in each center.

(iv) A central place in each field

office.

(v) A central place at the National

Center for Toxicological Research.

PART 14—PUBLIC HEARING BEFORE

A PUBLIC ADVISORY COMMITTEE

10. The authority citation for 21 CFR

part 14 continues to read as follows:

Authority: 5 U.S.C. App. 2; 15 U.S.C.

1451–1461; 21 U.S.C. 141–149, 321–394,

467f, 679, 821, 1034; 28 U.S.C. 2112; 42

U.S.C. 201, 262, 263b, 264.

11. Section 14.20 is amended by

adding paragraph (e) from January 22,

2001, to April 22, 2001, to read as

follows:

§ 14.20 Notice of hearing before an

advisory committee.

* * * * *

(e) All advisory committee meetings

are to be included on the public

calendar described in § 10.100(a).

PART 16—REGULATORY HEARING

BEFORE THE FOOD AND DRUG

ADMINISTRATION

12. The authority citation for 21 CFR

part 16 continues to read as follows:

Authority: 15 U.S.C. 1451–1461; 21 U.S.C.

141–149, 321–394, 467f, 679, 821, 1034; 28

U.S.C. 2112; 42 U.S.C. 201–262, 263b, 364.

13. Section 16.60 is amended by

adding paragraph (a)(3) from January 22,

2001, to April 22, 2001, to read as

follows:

§ 16.60 Hearing procedure.

(a) * * *

(3) If the hearing is a public hearing,

it will be announced on the public

calendar described in § 10.100(a)

whenever feasible, and any interested

person who attends the hearing may

participate to the extent of presenting

relevant information.

* * * * *

Dated: February 23, 2001.

Ann M. Witt,

Acting Associate Commissioner for Policy.

[FR Doc. 01–4962 Filed 2–28–01; 8:45 am]

BILLING CODE 4160–01–S

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Food and Drug Administration

21 CFR Parts 203 and 205

[Docket No. 92N–0297]

RIN 0905–AC81

Prescription Drug Marketing Act of

1987; Prescription Drug Amendments

of 1992; Policies, Requirements, and

Administrative Procedures; Delay of

Effective Date

AGENCY: Food and Drug Administration,

HHS.

ACTION: Final rule; delay of effective

date.

SUMMARY: The Food and Drug

Administration (FDA) is further

delaying, until April 1, 2002, the

effective date regarding certain

requirements of the final rule published

in the Federal Register of December 3,

1999 (64 FR 67720). The final rule

implements the Prescription Drug

Marketing Act of 1987 (PDMA), as

modified by the Prescription Drug

Amendments of 1992 (PDA), and the

Food and Drug Administration

Modernization Act of 1997 (the

Modernization Act). FDA is further

delaying the effective date for certain

requirements in the PDMA final rule

relating to wholesale distribution of

prescription drugs by distributors that

are not authorized distributors of record,

and distribution of blood derivatives by

entities that meet the definition of a

‘‘health care entity’’ in the final rule. In

the Federal Register of May 3, 2000 (65

FR 25639), the agency previously

delayed until October 1, 2001, the

effective date of these requirements. The

other provisions of the final rule became

effective on December 4, 2000. The

agency is taking this action to address

concerns about the requirements raised

by affected parties.

FDA believes that this further delay of

the effective date of certain

requirements in the PDMA final rule

satisfies the memorandum of January

20, 2001, from the Assistant to the

President and Chief of Staff, entitled

‘‘Regulatory Review Plan,’’ published in

the Federal Register on January 24,

2001 (66 FR 7702). That memorandum

requested Federal agencies to delay by

60 days the effective date of any

regulation that was not effective as of

January 20, 2001. The action taken in

this document to further delay the

effective date of certain requirements of

PDMA exceeds 60 days. To the extent

that 5 U.S.C. 553 applies to this action,

it is exempt from notice and comment

because it constitutes a rule of

procedure under 5 U.S.C. 553(b)(A).

Alternatively, the agency’s

implementation of this action without

opportunity for public comment,

effective immediately upon publication

today in the Federal Register, is based

on the good cause exceptions in 5 U.S.C.

553(b)(B) and (d)(3). Seeking public

comment is impracticable, unnecessary,

and contrary to the public interest. As

explained in the SUPPLEMENTARY

INFORMATION section entitled ‘‘Need to

Further Delay the Effective Date,’’ the

delay will give distributors additional

time to exhaust inventories of drugs that

do not have acceptable pedigrees to

avoid economic harm. Additionally, the

delay will allow more time for FDA to

make recommendations to Congress, for

Congress to evaluate those

recommendations and, if necessary,

Federal Register / Vol. 66, No. 41 / Thursday, March 1, 2001 / Rules and Regulations 12851

1The statement required under section

503(e)(1)(A) of the act is commonly referred to as

a drug ‘‘pedigree.’’

2An unauthorized wholesale distributor that

purchases a product from a manufacturer or

authorized distributor of record without an

identifying statement showing the prior sales of the

drug could not provide an identifying statement to

its purchasers and, therefore, could not conduct

further wholesale transactions of the drug in

compliance with § 203.50

time for a regulatory or legislative

change.

DATES: The effective date for §§ 203.3(u)

and 203.50, and the applicability of

§ 203.3(q) to wholesale distribution of

blood derivatives by health care entities,

added at 64 FR 67720, December 3,

1999, is delayed until April 1, 2002.

FOR FURTHER INFORMATION CONTACT: Lee

D. Korb, Center for Drug Evaluation and

Research (HFD–7), Food and Drug

Administration, 5600 Fishers Lane,

Rockville, MD 20857, 301–594–2041.

SUPPLEMENTARY INFORMATION:

I. Background

A. Legislative and Regulatory

Requirements for Distribution of

Prescription Drugs by Unauthorized

Distributors

PDMA (Public Law 100–293) was

enacted on April 22, 1988, and was

modified by the PDA (Public Law 102–

353, 106 Stat. 941) on August 26, 1992.

The PDMA, as modified by the PDA,

amended sections 301, 303, 503, and

801 of the Federal Food, Drug, and

Cosmetic Act (the act) (21 U.S.C. 331,

333, 353, 381) to, among other things,

establish requirements for the wholesale

distribution of prescription drugs.

Section 503(e)(1)(A) of the act states

that each person who is engaged in the

wholesale distribution of a prescription

drug who is not the manufacturer or an

authorized distributor of record for the

drug must, before each wholesale

distribution of a drug, provide to the

person receiving the drug a statement

(in such form and containing such

information as the Secretary may

require) identifying each prior sale,

purchase, or trade of the drug, including

the date of the transaction and the

names and addresses of all parties to the

transaction.1 Section 503(e)(4)(A) of the

act states that, for the purposes of

section 503(e), the term ‘‘authorized

distributors of record’’ means those

distributors with whom a manufacturer

has established an ‘‘ongoing

relationship’’ to distribute the

manufacturer’s products.

On December 3, 1999, the agency

published final regulations in part 203

(21 CFR part 203) implementing these

and other provisions of PDMA (64 FR

67720). Section 203.50 requires that,

before the completion of any wholesale

distribution of a prescription drug by a

wholesale distributor that is not an

authorized distributor of record to

another wholesale distributor or retail

pharmacy, the seller must provide to the

purchaser a statement identifying each

prior sale, purchase, or trade of the

drug. The identifying statement must

include the proprietary and established

name of the drug, its dosage, the

container size, the number of

containers, lot or control numbers of the

drug being distributed, the business

name and address of all parties to each

prior transaction involving the drug,

starting with the manufacturer, and the

date of each previous transaction.

Section 203.3(b) defines ‘‘authorized

distributor of record’’ as a distributor

with whom a manufacturer has

established an ongoing relationship to

distribute the manufacturer’s products.

‘‘Ongoing relationship’’ is defined in

§ 203.3(u) to mean an association that

exists when a manufacturer and a

distributor enter into a written

agreement under which the distributor

is authorized to distribute the

manufacturer’s products for a period of

time or for a number of shipments. If the

distributor is not authorized to

distribute a manufacturer’s entire

product line, the agreement must

identify the specific drug products that

the distributor is authorized to

distribute.

Thus, the final rule requires

unauthorized distributors (i.e., those

distributors who do not have a written

authorization agreement) to provide a

drug origin statement to purchasers

showing the entire prior sales history of

the drug back to the first sale by the

manufacturer. As discussed in the

preamble to the final rule (64 FR 67720

at 67747), manufacturers and authorized

distributors of record are not required to

provide an identifying statement when

selling a drug, although the agency

encouraged them to do so voluntarily to

permit unauthorized distributors to

continue to be able to purchase products

from them.2

B. Legislative and Regulatory

Requirements Restricting Distribution of

Blood Derived Prescription Drug

Products by Health Care Entities

Section 503(c)(3)(A) of the act states

that no person may sell, purchase, or

trade, or offer to sell, purchase, or trade

any prescription drug that was

purchased by a public or private

hospital or other health care entity.

Section 503(c)(3)(B) of the act states

several exceptions to section

503(c)(3)(A), none of which are relevant

to this discussion. Section 503(c)(3) of

the act also states that ‘‘[f]or purposes of

this paragraph, the term ‘entity’ does not

include a wholesale distributor of drugs

or a retail pharmacy licensed under

State law.’’

Section 203.20 of the final rule

provides, with certain exceptions, that

no person may sell, purchase, or trade,

or offer to sell, purchase, or trade any

prescription drug that was purchased by

a public or private hospital or other

health care entity or donated or

supplied at a reduced price to a

charitable organization. In § 203.3(q) of

the final rule, ‘‘Health care entity’’ is

defined as meaning any person that

provides diagnostic, medical, surgical,

or dental treatment, or chronic or

rehabilitative care, but does not include

any retail pharmacy or wholesale

distributor. Under both the act and the

final rule, a person could not

simultaneously be a health care entity

and a retail pharmacy or wholesale

distributor. Thus, under the final rule,

blood centers functioning as health care

entities could not engage in wholesale

distribution of prescription drugs,

except for blood and blood components

intended for transfusion, which are

exempt from the PDMA under § 203.1

of the final rule. Blood and blood

components include whole blood, red

blood cells, platelets, and

cryoprecipitated antihemophilic factor,

which are prepared by blood banks who

collect blood from donors and separate

out the components using physical or

mechanical means. Blood derivatives

are derived from human blood, plasma,

or serum through a chemical

fractionation manufacturing process.

Examples of blood derivative products

include albumin, antihemophilic factor,

immune globulin, and alpha-1 antitripsin. As discussed in the preamble to

the final rule in response to comments

(64 FR 67720 at 67725 through 67727),

blood derivative products are not blood

or blood components intended for

transfusion and therefore could not be

distributed by health care entities,

including full service blood centers that

function as health care entities, after the

final rule goes into effect.

C. Events Leading to the Delay of the

Effective Date

After publication of the final rule, the

agency received letters and petitions

and had other communications with

industry, industry trade associations,

and members of Congress objecting to

the provisions in §§ 203.3(u) and

203.50. On March 29, 2000, the agency

met with representatives from the

wholesale drug industry and industry

12852 Federal Register / Vol. 66, No. 41 / Thursday, March 1, 2001 / Rules and Regulations

3The Pharmaceutical Distributors Association is a

trade association representing unauthorized

wholesale prescription drug distributors.

associations to discuss their concerns.

In addition, FDA received a petition for

stay of action requesting that the

relevant provisions of the final rule be

stayed until October 1, 2001. The

agency also received a petition for

reconsideration from the Small Business

Administration requesting that FDA

reconsider the final rule and suspend its

effective date based on the severe

economic impact it would have on more

than 4,000 small businesses.

In addition to the submissions on

wholesale distribution by unauthorized

distributors, the agency received several

letters on, and held several meetings to

discuss, the implications of the final

regulations for blood centers that

distribute blood derivative products and

provide health care as a service to the

hospitals and patients they serve. The

blood center industry asserts that the

regulations, and particularly the

definition of ‘‘health care entity,’’ will

severely inhibit their ability to provide

medical care and services to the

detriment of client hospitals and the

patients they serve, and may disrupt the

distribution of blood derivatives to the

public. The agency also received a letter

from Congress on this issue.

Based on the concerns expressed by

industry, industry associations, and

Congress about implementing

§§ 203.3(u) and 203.50 by the December

4, 2000, effective date, the agency

published a document in the Federal

Register of May 3, 2000 (65 FR 25639),

delaying the effective date for those

provisions until October 1, 2001. In

addition, the May 2000 document

delayed the applicability of § 203.3(q) to

wholesale distribution of blood

derivatives by health care entities until

October 1, 2001. The May 2000

document also reopened the

administrative record and gave

interested persons until July 3, 2000, to

submit written comments. As stated in

the May 2000 document, the purpose of

delaying the effective date for these

provisions was to give the agency time

to obtain more information about the

possible consequences of implementing

them and to further evaluate the issues

involved.

D. House Committee on Appropriations

Reaction to Agency Delay and

Committee’s Report Request

On May 16, 2000, the House

Committee on Appropriations (the

Committee) stated in its report

accompanying the Agriculture, Rural

Development, FDA, and Related

Agencies Appropriations Bill, 2001 (H.

Rept. 106–619) that it supported the

‘‘recent FDA action to delay the

effective date for implementing certain

requirements of the Prescription Drug

Marketing Act until October 1, 2001,

and reopen the administrative record in

order to receive additional comments.’’

In addition, the Committee stated that it

‘‘believes the agency should thoroughly

review the potential impact of the

proposed provisions on the secondary

wholesale pharmaceutical industry.’’

The Committee directed the agency to

provide a report to the Committee by

January 15, 2001, summarizing the

comments and issues raised and agency

plans to address the concerns.

E. Public Hearing

After issuing the delay of the effective

date for the relevant requirements of the

final rule, the agency decided that it

would be in the public interest to hold

a public hearing to elicit comment on

the requirements from interested

persons. In the Federal Register of

September 19, 2000 (65 FR 56480), the

agency announced that a public hearing

would be held on October 27, 2000, to

discuss the requirements at issue (i.e.,

the requirements for unauthorized

distributors and the provisions relating

to distribution of blood derivatives by

health care entities). The document set

forth the purpose of the hearing and the

procedure by which individuals could

make a presentation at the hearing. In

addition, the document set forth

questions the agency wanted hearing

participants and comments to address.

The hearing was held on October 27,

2000, and comments were accepted

until November 20, 2000.

II. Need to Further Delay the Effective

Date

As discussed in section I of this

document, the House Committee on

Appropriations has directed the agency

to provide a report to the Committee by

January 15, 2001, summarizing the

comments and issues raised and agency

plans to address the concerns. The

agency is currently considering the

comments and testimony received and

preparing its report to Congress. If the

agency determines that some type of

action is appropriate, this action could

take the form of a change or

modification to the final rule initiated

by the agency or a legislative change

initiated by Congress. Obviously, it

would take a significant amount of time

beyond January 15, 2001, to initiate and

carry out either change. The agency

believes that a legislative change to the

act could take well into the 2001

calendar year.

In its hearing testimony and in a letter

submitted on November 3, 2000, the

Pharmaceutical Distributors

Association3 noted that if the final rule

were to apply to drugs already in

distribution as of the effective date of

the final rule, a significant number of

these drugs would have to be taken out

of distribution because of the absence of

a proper pedigree. The association

specifically stated that if the final rule

as published were to go into effect

October 1, 2001, distributors would

need to stop buying drugs that do not

have the required pedigree under the

final rule and would have to begin to

exhaust existing inventories of drugs

that do not have acceptable pedigrees by

the beginning of the year 2001 to avoid

economic harm. The association

specifically sought a decision by the

agency that the final rule not apply to

prescription drugs already in

distribution as of the effective date so

those drugs could be distributed.

FDA acknowledges the concerns of

the Pharmaceutical Distributors

Association and has decided that, in

light of the uncertainty regarding how to

resolve the issues involved and the

possible adverse consequences that

could result from implementation of the

relevant provisions of the final rule, it

is reasonable and appropriate to delay

the effective date of §§ 203.3(u) and

203.50 for another 6 months until April

1, 2002. Additionally, the agency has

decided to delay the applicability of

§ 203.3(q) to wholesale distribution of

blood derivatives by health care entities

until April 1, 2002. This delay will

allow time for the agency to make its

recommendations to Congress, for

Congress to evaluate those

recommendations, and, depending on

the decisions of the agency and

Congress, for a regulatory or legislative

change to address the issues raised.

Although a further delay of the effective

date of the relevant provisions of the

final rule is not the exact relief

requested by the Pharmaceutical

Distributors Association, the agency

believes that it accomplishes the same

purpose in that it will permit

unauthorized distributors to operate for

an additional 6 months without concern

that the drugs in their inventory may

become illegal to distribute and

therefore valueless. All other provisions

of the PDMA final rule became effective

on December 4, 2000. This action

should not be construed to indicate that

FDA necessarily agrees with or has

made decisions about the substantive

arguments made in the petitions and

other submissions related to

implementation of §§ 203.3(u) and

Federal Register / Vol. 66, No. 41 / Thursday, March 1, 2001 / Rules and Regulations 12853

203.50, or § 203.3(q), as it applies to

wholesale distribution of blood

derivatives by health care entities.

This action is being taken under

FDA’s authority under 21 CFR 10.35(a).

The Commissioner of Food and Drugs

finds that this further delay of the

effective date is in the public interest.

Dated: February 22, 2001.

Ann M. Witt,

Acting Associate Commissioner for Policy.

[FR Doc. 01–4964 Filed 2–28–01; 8:45 am]

BILLING CODE 4160–01–S

DEPARTMENT OF THE TREASURY

Internal Revenue Service

26 CFR Part 1

[TD 8934]

RIN 1545–AX60

Reopenings of Treasury Securities and

Other Debt Instruments; Original Issue

Discount; Correction

AGENCY: Internal Revenue Service (IRS),

Treasury.

ACTION: Correction to final regulations.

SUMMARY: This document contains

corrections to final regulations that were

published in the Federal Register on

Friday, January 12, 2001 (66 FR 2811),

relating to reopenings of Treasury

securities, other debt instruments, and

original issue discount.

DATES: This correction is effective

March 13, 2001.

FOR FURTHER INFORMATION CONTACT:

William E. Blanchard, (202) 622–3950

(not a toll-free number).

SUPPLEMENTARY INFORMATION:

Background

The final regulations (TD 8934) that

are the subject of these corrections are

under section 1275 of the Internal

Revenue Code.

Need for Correction

As published the final regulations (TD

8934) contain errors that may prove to

be misleading and are in need of

clarification.

Correction of Publication

Accordingly, the publication of the

final regulations (TD 8934), which were

the subject of FR Doc. 01–622, is

corrected as follows:

On page 2813, column 2, in the

preamble under the heading ‘‘(2) Yield

Test’’, second line from the bottom of

the column the language ‘‘pecent test in

the proposed regulations’’ is corrected

to read ‘‘percent test in the proposed

regulations’’.

Cynthia E. Grigsby,

Chief, Regulations Unit, Office of Special

Counsel (Modernization & Strategic

Planning).

[FR Doc. 01–4922 Filed 2–28–01; 8:45 am]

BILLING CODE 4830–01–P

DEPARTMENT OF THE TREASURY

Bureau of Alcohol, Tobacco and

Firearms

27 CFR Parts 19 and 21

[T.D. ATF–442; Ref: Notice No. 832]

RIN 1512–AB60

Formulas for Denatured Alcohol and

Rum (2000R–295P)

AGENCY: Bureau of Alcohol, Tobacco

and Firearms (ATF), Department of the

Treasury.

ACTION: Final Rule (Treasury decision).

SUMMARY: This final rule amends the

regulations in 27 CFR Parts 19 and 21

by updating the information relating to

the formulation of completely denatured

alcohol (CDA), specially denatured

alcohol (SDA), and specially denatured

rum (SDR); the denaturants authorized

for use in the manufacturing of these

formulations; and the specifications for

these denaturants. The updates include

removing the proprietary brand name

‘‘BITREX’’ listed with the denaturant

denatonium benzoate, incorporating an

ATF ruling that approves the use of two

substitute denaturants, and making

other amendments to provide clarity.

DATES: This rule is effective on March 1,

2001.

FOR FURTHER INFORMATION CONTACT: Lisa

M. Gesser, Regulations Division, Bureau

of Alcohol, Tobacco and Firearms, 650

Massachusetts Avenue NW.,

Washington, DC 20226, (202–927–9347)

or e-mail at alctob@atfhq.atf.treas.gov.

SUPPLEMENTARY INFORMATION:

Background

27 CFR Part 21 contains listings of

information relating to the formulation

of CDA, SDA, and SDR, to the

specifications for denaturants and to the

denaturants authorized for use in the

formulation of CDA, SDA, and SDR.

ATF is authorized under § 5242 of the

Internal Revenue Code of 1986 to

prescribe the character and quantity of

approved denaturing materials.

Pursuant to § 21.91, ATF may authorize

substitutions or variations from the

specified list of denaturants upon

application filed with ATF by the

denaturer. This final rule amends Part

21 by incorporating additional

denaturants that have been approved

pursuant to such applications.

Additionally, this final rule incorporates

several technical corrections.

Substitute Denaturants

ATF Ruling 94–4 approved the use of

heptane as a substitute denaturant for

toluene in SDA Formula No. 2–B (SDA

2–B) and alpha terpineol as a substitute

denaturant in SDA Formula No. 38–B

(SDA 38–B).

Heptane is currently approved as a

substitute denaturant for rubber

hydrocarbon solvent in SDA 28–A. This

ruling allows for the use of heptane as

a substitute, on an equal (1:1) basis, for

any one of the denaturants (toluene,

benzene or rubber hydrocarbon solvent)

in SDA 2–B.

Alpha terpineol, having similar

specifications to those of pine oil, N.F.,

an approved denaturant for SDA 38–B,

is now approved for use as a substitute

denaturant in SDA 38–B.

Removal of a Proprietary Name

This final rule removes the

proprietary brand name ‘‘BITREX’’ each

place it appears in parts 19 and 21. The

use of the proprietary brand name

‘‘BITREX’’ in conjunction with the

approved denaturant denatonium

benzoate, N.F. may be mistakenly

considered a product endorsement by

ATF over all over proprietary names.

Other Changes

27 CFR 21.6 and 21.141 are amended

to correctly cite referenced information.

Notice of Proposed Rulemaking

On July 31, 1996, ATF published a

notice of proposed rulemaking (Notice

No. 832, 61 FR 39929–39931) to solicit

public comment on regulations to

update the information provided in

parts 19 and 21 relating to the

formulation of CDA, SDA, and SDR; the

denaturants authorized for use in the

manufacturing of these formulations;

and the specifications for these

denaturants. The comment period

closed on September 30, 1996.

Comments on the NPRM

ATF did not receive any comments in

response to Notice 832, therefore, most

of the amendments proposed in Notice

No. 832 have been adopted in this final

rule.

Paperwork Reduction Act

The provisions of the Paperwork

Reduction Act of 1995, 44 U.S.C.

Chapter 35, and its implementing