Document ID: FDA-2011-N-0898-0001
Agency: fda
Document Type: Rule
Title: Applications for Food and Drug Administration Approval to Market New Drug: Revision of Postmarketing Reporting Requirements; Discontinuance
Posted Date: 2011-12-19T05:00Z

[Federal Register Volume 76, Number 243 (Monday, December 19, 2011)]
[Rules and Regulations]
[Pages 78530-78540]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-32354]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 314

[Docket No. FDA-2011-N-0898]

Applications for Food and Drug Administration Approval To Market 
a New Drug; Revision of Postmarketing Reporting Requirements--
Discontinuance

AGENCY: Food and Drug Administration, HHS.

ACTION: Interim final rule; request for comments.

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SUMMARY: The Food and Drug Administration (FDA or the Agency) is 
issuing an interim final rule amending its postmarketing reporting 
regulations implementing certain provisions of the Federal Food, Drug 
and Cosmetic Act. The provisions of the Federal Food, Drug and Cosmetic 
Act require manufacturers who are the sole manufacturers of certain 
drug products to notify FDA at least 6 months before discontinuance of 
manufacture of the products. This interim final rule modifies the term 
``discontinuance'' and clarifies the term ``sole manufacturer'' with 
respect to notification of discontinuance requirements. The broader 
reporting resulting from these changes will enable FDA to improve its 
collection and distribution of drug shortage information to physician 
and patient organizations and to work with manufacturers and other 
stakeholders to respond to potential drug shortages.

DATES: This interim final rule is effective January 18, 2012. Submit 
either electronic or written comments on the provisions of this interim 
final rule by February 17, 2012. Submit comments on the information 
collection requirements under the Paperwork Reduction Act of 1995 by 
January 3, 2012 (see the ``Paperwork Reduction Act of 1995'' section of 
this document).

ADDRESSES: You may submit comments, identified by Docket No. FDA-2011-
N-0898 by any of the following methods, except that comments on 
information collection issues under the Paperwork Reduction Act of 1995 
must be submitted to the Office of Regulatory Affairs, Office of 
Management and Budget (OMB) (see the ``Paperwork Reduction Act of 
1995'' section of this document).

Electronic Submissions

    Submit electronic comments in the following way:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.

Written Submissions

    Submit written submissions in the following ways:
     Fax: (301) 827-6870.
     Mail/Hand delivery/Courier (for paper, disk, or CD-ROM 
submissions): Division of Dockets Management (HFA-305), Food and Drug 
Administration, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852.
    Instructions: All submissions received must include the Agency name 
and Docket No. FDA-2011-N-0898 for this rulemaking. All comments 
received may be posted without change to http://www.regulations.gov, 
including any personal information provided. For additional information 
on submitting comments, see the ``Comments'' heading of the 
SUPPLEMENTARY INFORMATION section of this document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov and insert the 
docket number, found in brackets in the heading of this document, into 
the ``Search'' box and follow the prompts and/or go to the Division of 
Dockets Management, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Kalah Auchincloss, Center for Drug 
Evaluation and Research, Food and Drug Administration, 10903 New 
Hampshire Ave., Silver Spring, MD 20993, (301) 796-0659, or Stephen 
Ripley, Center for Biologics Evaluation and Research, Food and Drug 
Administration, 1401 Rockville Pike, Rockville, MD 20852-1448, (301) 
827-6210.

SUPPLEMENTARY INFORMATION: 

I. Background

    In the Federal Register of October 18, 2007 (72 FR 58993), we (FDA) 
issued a final rule to revise our postmarketing reporting requirements 
to implement section 506C of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 356c). Section 506C of the Federal Food, Drug, and Cosmetic 
Act (section 506C) requires manufacturers who are the sole 
manufacturers of certain drug products to notify us at least 6 months 
before discontinuance of manufacture of the products. Section 506C 
applies to sole manufacturers of products that meet the following three 
criteria:
    1. The products are life supporting, life sustaining, or intended 
for use in the prevention of a debilitating disease or condition;
    2. The products are approved under section 505(b) or (j) of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(b) or (j)); and
    3. The products are not originally derived from human tissue and 
replaced by a recombinant product.
    These three criteria are statutory requirements. FDA assesses 
whether a drug is ``life supporting, life sustaining, or intended for 
use in the prevention of a debilitating disease or condition'' on a 
case-by-case basis, but intends to provide further guidance on this 
issue in the near future.
    Section 506C also requires us to distribute certain information 
about covered discontinuances to appropriate physician and patient 
organizations. Under section 506C, FDA may reduce the 6-month 
notification period if we find good cause exists for the reduction.
    Recent experience with drug shortages in the United States has 
shown the serious and immediate impacts they can have on patients and 
healthcare providers, particularly those shortages involving drugs that 
are manufactured by a small number of firms and for which there are no 
good therapeutic substitutes available. The number of drug shortages 
annually has tripled from 61 in 2005 to 178 in 2010. Some shortages 
delay or deny needed care for patients, because they involve critical 
drugs used to treat cancer, to provide required parenteral nutrition, 
or to address other serious medical conditions. Other shortages can 
result in providers prescribing second-line alternatives, which may be 
less effective and higher risk than first-line therapies. A survey of 
1,800 health practitioners conducted by the Institute for Safe 
Medication Practices (ISMP) concluded that drug shortages could lead to 
medication errors and poor patient outcomes because shortages can 
result in the use of secondary alternative therapies (Ref. 1).
    In light of increasing concerns about the impact of drug shortages 
on health care in the United States, on October 31, 2011, the President 
issued Executive Order 13588 directing the FDA to ``take steps that 
will help to prevent and reduce current and future disruptions in the 
supply of lifesaving medicines'' and noting that ``one important step 
is ensuring that the FDA and the public

[[Page 78531]]

receive adequate advance notice of shortages whenever possible'' (Ref. 
2). In response to the Executive Order's directive to address the 
growing drug shortage problem, this rule modifies the regulation at 
Sec.  314.81(b)(3)(iii) (21 CFR 314.81(b)(3)(iii)), which, in addition 
to Sec.  314.91 (21 CFR 314.91), implements section 506C of the Federal 
Food, Drug, and Cosmetic Act.

II. Overview of the Interim Final Rule

    This interim final rule adds two definitions to Sec.  
314.81(b)(3)(iii)--a definition of ``discontinuance'' and a definition 
of ``sole manufacturer.'' Although these terms were discussed in the 
preamble to the final rule issuing Sec.  314.81(b)(3)(iii) published on 
October 18, 2007 (72 FR 58993) (2007 Preamble), and have been used in 
various documents informally expressing the Agency's interpretation of 
section 506C and its implementing regulations (see, for example, the 
Center for Drug Evaluation and Research (CDER) Manual of Policies and 
Procedures 6003.1, Drug Shortage Management (Ref. 3)), these terms were 
not defined in the regulation. Given the serious and growing threat to 
public health due to drug shortages, the Agency believes it is 
appropriate at this time to codify definitions of these terms. This 
modification and clarification of our existing regulations will further 
the public health objective of the Federal Food, Drug, and Cosmetic Act 
as a whole, and section 506C specifically by increasing the scope of 
information that FDA receives regarding discontinuances. This will 
enable the Agency to: (1) Expand collection and distribution of 
information on the discontinuance of certain drugs to appropriate 
physician and patient organizations as required by section 506C(c); and 
(2) work with manufacturers and other stakeholders to implement 
appropriate strategies to reduce, to the greatest extent possible, the 
public health impact of discontinuances of products that can lead to 
drug shortages. We believe that clarification of terminology will also 
improve statutory compliance.

A. Discontinuance

    The Agency is revising an earlier policy position and defining the 
term ``discontinuance'' in the regulation to include both permanent and 
temporary interruptions in the manufacturing of a drug product, if the 
interruption could lead to a disruption in supply of the product. This 
interpretation of the statutory language best achieves the public 
health purpose of section 506C and the Federal Food, Drug, and Cosmetic 
Act as a whole.
    Under section 506C, sole manufacturers are required to notify FDA 
of a ``discontinuance'' of a drug product subject to section 506C. In 
the 2007 Preamble, in response to a comment on the meaning of the term 
discontinuance, we indicated that a discontinuance did not include 
planned or unplanned temporary manufacturing cessations (72 FR 58993 at 
58995, response to comment 4). At that time, we stated that only 
manufacturers who intended to permanently discontinue manufacture and 
marketing of the drug product were subject to mandatory reporting 
requirements under section 506C. In our response to the comment in the 
2007 Preamble, however, we did request that manufacturers who 
experience an unplanned temporary manufacturing cessation keep the 
Agency informed of the status of the shutdown because ``the duration of 
an unplanned shutdown may be unpredictable and could affect the 
availability of needed therapy for patients.''
    FDA no longer believes that this narrow policy position regarding 
the term ``discontinuance'' serves the public health need that the 
Federal Food, Drug, and Cosmetic Act was intended to address. In 2007, 
the Agency believed that the supply of drug product available to 
patients during a temporary manufacturing cessation, particularly one 
that was planned, would not be greatly affected during the interruption 
in manufacturing. However, subsequent experience has shown that even 
temporary discontinuances of manufacturing can have a significant 
impact on patient access to drug products. For example, if an equipment 
failure necessitates an unexpected temporary interruption in 
manufacturing of a drug product subject to section 506C, this 
discontinuance could have serious implications for patient access to 
the product. Notification to FDA of such discontinuances will expand 
FDA's ability to distribute information on the discontinuance of 
certain drugs to physician and patient organizations and enable FDA to 
work with manufacturers and other stakeholders to respond to potential 
drug shortages.
    The interim final rule therefore adds Sec.  314.81(b)(3)(iii)(d) to 
provide that ``discontinuance'' means ``any interruption of 
manufacturing of a drug product described in paragraph (b)(3)(iii)(a) 
for sale in the United States that could lead to a potential disruption 
in supply of the drug product, whether the interruption is intended to 
be temporary or permanent.'' Thus the term ``discontinuance'' now 
includes both temporary and permanent interruptions in manufacturing, 
if the interruption could lead to a disruption in supply of the 
product. This interpretation of ``discontinuance'' is consistent with 
Webster's Third New International Dictionary, which defines the term to 
mean ``cessation, shutdown, closure; interruption'' (Ref. 4). The 
dictionary definition indicates that a discontinuance can be 
interpreted to include both situations that are permanent (cessation, 
shutdown, closure) and those that are temporary (interruption).
    Any permanent discontinuance of manufacturing by a sole 
manufacturer will lead, per se, to a disruption in supply of the 
product; thus, all permanent discontinuances must continue to be 
reported. Temporary discontinuances must be reported to the Agency 
under this interim final rule only if the discontinuance could lead to 
a disruption in supply of the product.
    We understand that a manufacturer may be unable to report some 
temporary discontinuances 6 months before the discontinuance, as 
required by statute. When notification at least 6 months prior to the 
discontinuance is impossible because it was unforeseen, the 
manufacturer must notify the Agency as soon as possible after it knows 
that a discontinuance will occur. For example, if a contamination 
problem requires immediate shut down of a manufacturing plant for a 
drug product subject to section 506C, the manufacturer will not be able 
to provide the FDA with 6 months prior notification, but would be 
required to notify FDA as soon as the manufacturer becomes aware that 
the contamination necessitates a temporary discontinuance of 
manufacture of the product.
    Other circumstances that would trigger notification to the FDA of a 
discontinuance of a drug product subject to section 506C include:
     A business decision to permanently discontinue manufacture 
of a drug product;
     A delay in acquiring active pharmaceutical ingredients or 
inactive ingredients that leads to, or could lead to, a temporary 
interruption in manufacturing of a drug product while alternative 
suppliers are located;
     Equipment failure or contamination affecting the quality 
of a drug product that necessitates an interruption in manufacturing 
while the equipment is repaired or the contamination issue is 
addressed;
     Manufacturing shut-downs for maintenance or other routine 
matters, if

[[Page 78532]]

the shut-down extends for longer than anticipated or otherwise could 
disrupt supply of a drug product;
    Conversely, a manufacturer is not required to notify FDA if a 
discontinuance is part of the normal manufacturing schedule and is not 
expected to lead to a disruption in supply of a drug product subject to 
506C. For example, FDA need not be notified in the following 
circumstances:
     The manufacturer uses the same manufacturing plant to 
manufacture two drug products, one of which (Product A) is subject to 
section 506C. From January to June of each year the manufacturer uses 
the plant to produce Product A. From July to December of each year the 
manufacturer uses the plant to produce Product B. Although this could 
be considered a temporary discontinuance of Product A from July to 
December, because this is the usual manufacturing schedule and should 
not therefore result in a disruption in the supply of Product A, the 
manufacturer need not notify the Agency of the annual, temporary 
discontinuance of Product A.
     A manufacturer of a drug product implements a scheduled 
shutdown of its manufacturing facility each year for routine 
maintenance. The annual shutdown is anticipated and planned for in 
advance; therefore, it is not expected to disrupt supply of a drug 
product subject to 506C. The shutdown does not need to be reported to 
the Agency under section 506C.
     A manufacturer of a drug product subject to 506C 
experiences an unexpected power outage that results in an unscheduled 
interruption in manufacturing. The manufacturer expects to resume 
normal operations within a relatively short timeframe and does not 
expect a disruption in the supply of the drug product. The shutdown 
does not need to be reported to the Agency under section 506C.
    If any of the circumstances described above do lead to a disruption 
in supply of the drug product, even if unanticipated, then it becomes a 
reportable discontinuance under this rule and the manufacturer would be 
required to notify FDA of a discontinuance of the product.
    In addition to revising the definition of ``discontinuance,'' this 
interim final rule makes a minor conforming change by striking the 
phrase ``discontinuing manufacture'' in the first sentence of Sec.  
314.81(b)(3)(iii)(a) and replacing it with the phrase ``discontinuance 
of manufacture.'' This change ensures that the regulations contain an 
appropriate cross-reference to the revised definition of 
discontinuance.
    The interim final rule also makes a minor change to the procedures 
in Sec.  314.81(b)(3)(iii)(b) for reporting notices of discontinuances 
to the Agency. The interim final rule requires manufacturers to report 
a notice of a discontinuance to FDA either electronically or by 
telephone according to instructions on the FDA's Drug Shortages Web 
site at http://www.fda.gov/Drugs/DrugSafety/DrugShortages. Products 
regulated by CDER must be reported to the CDER Drug Shortages 
Coordinator. Products regulated by the Center for Biologics Evaluation 
and Research (CBER) must be reported to the CBER Products Shortage 
Coordinator. This change ensures that the appropriate offices are 
timely notified of all relevant discontinuances. It also reflects 
existing practice for submitting notices of discontinuance, and reduces 
the burden on industry to submit multiple copies of the notification.

B. Sole Manufacturer

    To best achieve the public health purposes of the Federal Food, 
Drug, and Cosmetic Act, and section 506C, the Agency is clarifying the 
term sole manufacturer to ensure that we receive timely reports of all 
discontinuances of drug products subject to section 506C, including 
where other strengths, dosage forms, or routes of administration of the 
same drug product are marketed. The clarification is intended to 
improve statutory compliance and to minimize instances where 
manufacturers fail to make reports to the Agency as required by section 
506C. This clarification of the statutory language best achieves the 
purpose of section 506C and the Federal Food, Drug, and Cosmetic Act as 
a whole.
    Section 314.81(b)(3)(iii) currently does not include a definition 
of the term ``sole manufacturer.'' In the 2007 Preamble, we rejected a 
suggestion to rely on the ``Orange Book'' (FDA's publication on 
``Approved Drug Products with Therapeutic Equivalence Evaluations'') as 
the source for determining whether an entity is a sole manufacturer (72 
FR 58993 at 58995, comment 3). The comment to the proposed rule had 
expressed concern that, although the Orange Book lists all drug 
products with approved new drug applications (NDA) and abbreviated new 
drug applications (ANDA), it is not possible to determine whether the 
listed approved products are, in fact, being manufactured. The comment 
requested that we define sole manufacturer as ``an applicant listed in 
the Orange Book who is the holder of the only listed approved 
application under section 505(b) or (j) of the [FD&C] Act.'' We 
declined to accept this definition of sole manufacturer, and reliance 
on the Orange Book, to determine whether an applicant was a sole 
manufacturer for several reasons in 2007, including the following: (1) 
There may be delays in updating the Orange Book, rendering it 
temporarily inaccurate; (2) the suggested definition could create 
potential confusion because some drugs are approved but not marketed 
and are therefore placed in the ``discontinued'' section of the Orange 
Book; and (3) there are other generally reliable sources for obtaining 
commercial manufacturing information to assist in determining whether 
an applicant is a sole manufacturer.
    We continue to believe that reference to the Orange Book is not the 
appropriate way to identify a ``sole manufacturer'' for purposes of 
implementing section 506C. In addition, we believe there has been some 
confusion as to the scope of the term. Accordingly, the interim final 
rule adds Sec.  314.81(b)(3)(iii)(d) to define ``sole manufacturer'' in 
the regulation to mean ``an applicant that is the only entity currently 
manufacturing a drug product of a specific strength, dosage form, or 
route of administration for sale in the United States, whether the 
product is manufactured by the applicant or for the applicant under 
contract with one or more different entities.''
    The definition in this interim final rule is intended to clarify 
that a sole manufacturer means the only applicant currently supplying 
the U.S. market with the drug product. It does not mean sole NDA or 
ANDA holder. A manufacturer is considered a sole manufacturer even if 
other manufacturers hold an approved NDA or ANDA for the same product, 
if the other applicants are no longer manufacturing (or have never 
manufactured) the product for sale in the United States. For example, 
Company A holds an NDA for a drug product subject to section 506C and 
manufactures and sells that product in the United States. Company B 
holds an ANDA for the drug product, but does not manufacture or sell 
the product in the United States. Company A would be considered a sole 
manufacturer of the drug product for purposes of reporting a 
discontinuance of the drug product under section 506C. If Company B 
began manufacturing and selling the drug product in the United States, 
then Company A would no longer be considered a sole manufacturer. A 
manufacturer is responsible for determining if it is a sole 
manufacturer under this regulation. There is commercial information 
available to

[[Page 78533]]

help with this determination. If an applicant is unsure if it is a sole 
manufacturer of a drug product subject to section 506C, FDA's drugs 
shortages staff may be able to work with it to help it determine 
whether it is or is not the sole manufacturer of the drug.
    The interim final rule also clarifies that the specific strength, 
dosage form, and route of administration of the product are critical in 
determining if a manufacturer is a sole manufacturer. For example, if a 
company manufacturers for sale in the United States an injectable 
dosage form of a drug product subject to section 506C, that company is 
considered a sole manufacturer of that drug product, even if a second 
company manufactures and sells in the United States an oral dosage form 
of the same drug product for the same indication. In this example, if 
the second company was the only applicant manufacturing and selling the 
oral dosage form in the United States, both companies would be 
considered sole manufacturers for purposes of section 506C.
    It is important that an entity currently manufacturing a drug 
product of a specific strength, dosage form, or route of administration 
for sale in the United States report a discontinuance to FDA because 
that specific strength, dosage form, or route of administration may be 
critical for the targeted needs of particular patients. To enable the 
Agency to fully distribute information under section 506C(c), and to 
work most effectively with manufacturers and other stakeholders to 
implement appropriate strategies to reduce, to the greatest extent 
possible, the public health impact of drug shortages, discontinuances 
of a specific strength, dosage form, or route of administration of drug 
products subject to section 506C must be reported to us. Moreover, 
recent experience has shown that discontinuances of a specific 
strength, dosage form, or route of administration of a drug product may 
lead to a shortage of another strength, dosage form, or route of 
administration of the product, compounding patient difficulties in 
obtaining the drug product.
    Finally, the new definition in the interim final rule clarifies who 
bears the responsibility for reporting to FDA a discontinuance of a 
drug product subject to section 506C. The inclusion of ``whether the 
product is manufactured by the applicant or for the applicant under 
contract with one or more different entities'' in the definition makes 
clear that the application holder must report a discontinuance to FDA. 
For purposes of section 506C, an application holder will be considered 
a ``manufacturer'' even if the application holder contracts that 
function out to another entity. The application holder is responsible 
for establishing a process with any relevant contract manufacturer that 
ensures the application holder's compliance with this rule. This could 
include contractual terms between the application holder and the 
contract manufacturer, as well as monitoring. For example, Company X 
holds an NDA for a drug product subject to section 506C. Company X 
contracts with Company Y to manufacture the drug product for the 
purposes of marketing and selling the drug product in the United 
States. Company X would be considered the ``sole manufacturer'' in the 
above situation, and is required to establish a process with Company Y 
that ensures Company X's ability to report a discontinuance of the drug 
product to FDA.

III. Legal Authority

    FDA is amending its postmarketing reporting regulations 
implementing section 506C of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 356c). Section 506C requires manufacturers who are the sole 
manufacturers of certain drug products to notify us at least 6 months 
before discontinuance of manufacture of the drug products. This interim 
final rule modifies the term ``discontinuance'' and clarifies the term 
``sole manufacturer'' with respect to section 506C notification 
requirements. FDA's authority for this rule also derives from section 
701(a) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 371(a)).
    The Administrative Procedure Act permits an agency to promulgate a 
rule without notice and comment procedures when an agency for ``good 
cause finds (and incorporates the finding and a brief statement of 
reasons therefor in the rules issued) that notice and public procedure 
thereon are impracticable, unnecessary, or contrary to the public 
interest'' (5 U.S.C. 553(b); 21 CFR 10.40(e)). FDA has determined that 
good cause exists for this interim final rule and that notice and 
comment procedures are contrary to the public interest given the 
serious and growing threat to public health due to drug shortages.
    Recent experience with drug shortages in the United States has 
shown serious and immediate impacts on patients and healthcare 
providers, particularly those shortages involving drugs that are 
manufactured by a small number of firms and for which there are no good 
therapeutic substitutes available. Some shortages delay or deny needed 
care for patients, because they involve critical drugs used to treat 
cancer, to provide required parenteral nutrition, or to address other 
serious medical conditions. Other shortages can result in providers 
prescribing second-line alternatives, which may be less effective and 
higher risk than first-line therapies. The number of drug shortages 
annually has tripled from 61 in 2005 to 178 in 2010. New shortages are 
occurring at the present time.
    The scope of information FDA receives under the current regulations 
has not adequately enabled the Agency to distribute information on the 
discontinuance of certain drugs to physician and patient organizations 
as required by section 506C(c) and to work with manufacturers and other 
stakeholders to respond to potential drug shortages. There are 
significant non-quantifiable benefits of reporting information about 
discontinuances to FDA, including better enabling the Agency, 
manufacturers, healthcare providers, and patients to monitor and 
evaluate these discontinuances to mitigate or prevent potential drug 
shortages that can arise as a result of these discontinuances and that 
could otherwise lead to serious and widespread adverse health 
consequences. Any delay in the implementation of this rule would limit 
the ability of healthcare providers to respond to potential and actual 
shortages, and would reduce the ability of FDA to work with 
manufacturers and other stakeholders to prevent and mitigate drug 
shortages. In this instance, FDA has determined that an interim final 
rule is legally permissible and in the public's interest.

IV. Analysis of Impacts

A. Introduction and Summary

1. Introduction
    FDA has examined the impacts of the interim final rule under 
Executive Order 12866, Executive Order 13563, the Regulatory 
Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform 
Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct 
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). This interim final rule is a 
significant regulatory action as defined by Executive Order 12866 and 
accordingly has been reviewed by the Office of Management and Budget.
    The Regulatory Flexibility Act requires agencies to analyze 
regulatory

[[Page 78534]]

options that would minimize any significant impact of a rule on small 
entities. The Agency projects that the interim final rule will not 
likely have a significant economic impact on a substantial number of 
small entities, but seeks comments on its analysis below.
    Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires 
that Agencies prepare a written statement, which includes an assessment 
of anticipated costs and benefits, before proposing ``any rule that 
includes any Federal mandate that may result in the expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100,000,000 or more (adjusted annually for 
inflation) in any one year.'' The current threshold after adjustment 
for inflation is $136 million, using the most current (2010) Implicit 
Price Deflator for the Gross Domestic Product. FDA does not expect this 
interim final rule to result in any 1-year expenditure that would meet 
or exceed this amount.
2. Summary
    The interim final rule modifies the term ``discontinuance'' and 
clarifies the term ``sole manufacturer'' with respect to notifications 
of discontinuance of products that are life supporting, life 
sustaining, or intended for use in the prevention of a debilitating 
disease or condition. The interim final rule will impose annual 
reporting costs of up to $15,064 in total. Non-quantifiable benefits 
include the value of the reported information about discontinuances in 
helping FDA, manufacturers, healthcare providers, and patients to 
monitor and evaluate these discontinuances to mitigate or prevent 
potential drug shortages that can arise as a result of these 
discontinuances and that could otherwise lead to serious and widespread 
adverse health consequences.

B. Objective of and Need for the Interim Final Rule

    Current regulations require that a sole manufacturer of a drug 
product that is: (1) Life supporting, life sustaining, or intended for 
use in the prevention of a debilitating disease or condition; (2) 
approved under section 505(b) or 505(j) of the Federal Food, Drug, and 
Cosmetic Act; and (3) not a product that was originally derived from 
human tissue and was replaced by a recombinant product report permanent 
discontinuances to FDA at least 6 months prior to the discontinuance. 
FDA can reduce the 6-month notification period if the applicant submits 
a certification of good cause, and the Agency finds good cause.
    The purpose of the interim final rule is to define the terms 
``discontinuance'' and ``sole manufacturer.'' In the interim final 
rule, ``discontinuance'' is defined as ``any interruption in 
manufacturing of a drug product described in paragraph (b)(3)(iii)(a) 
for sale in the United States that could lead to a potential disruption 
in supply of the drug product, whether the interruption is intended to 
be temporary or permanent.'' ``Sole manufacturer'' is defined as ``an 
applicant that is the only entity currently manufacturing a drug 
product of a specific strength, dosage form, or route of administration 
for sale in the United States, whether the product is manufactured by 
the applicant or for the applicant under contract with one or more 
different entities.'' These definitions will require additional 
manufacturers to report to FDA a wider range of discontinuances that 
could potentially lead to a drug shortage than under the current, 
existing regulations.
    While existing regulations require that only permanent 
discontinuances be reported to FDA, in practice, some manufacturers 
voluntarily notify FDA about temporary discontinuances. In the past 2 
years, such notifications have enabled FDA to prevent 233 drug 
shortages by expediting review of new manufacturing sites, new 
suppliers, and specification changes. Nonetheless, recent data from 
FDA's Drug Shortages Program (DSP) indicate that the number of drug 
shortages has tripled from 2005 to 2010 (see figure 1 below, Ref. 5).
[GRAPHIC] [TIFF OMITTED] TR19DE11.002

    A survey conducted by the American Hospital Association (AHA) 
concluded that drug shortages are experienced by hospitals. For 
example, almost 100 percent of the 820 hospitals surveyed had 
experienced at least one drug shortage in the 6 months preceding the 
survey (Ref. 6). Another survey of 1,800 health practitioners conducted 
by the ISMP suggested that because drug shortages often result in the 
need for physicians to prescribe alternative therapies which may be 
less effective and higher risk than first-line treatments, drug 
shortages can lead to the potential for medication errors and poor 
patient outcomes as well as higher costs (Refs. 1 and 7).
    The interim final rule is intended to increase the scope of 
information that FDA receives, enabling the Agency to: (1) Expand 
distribution of information on the discontinuance of certain drugs to 
appropriate physician and patient organizations as required by section 
506C(c); and (2) work with manufacturers and other stakeholders to 
implement appropriate strategies to reduce, to the greatest extent 
possible, the public health impact of discontinuances of products that 
can lead to drug shortages. The public health purpose of section 506C 
and the Federal Food, Drug, and Cosmetic Act as a whole are best 
achieved with this modification to our existing regulations.

[[Page 78535]]

Currently it appears that some manufacturers may lack sufficient 
incentives to either take steps to prevent certain shortages or to 
notify FDA early enough for the Agency to act (Ref. 7). By providing 
clear definitions, the interim final rule will address this concern and 
require all applicants to report appropriate information to the Agency 
in a timely manner.

C. Benefits

    The interim final rule modifies the term ``discontinuance'' and 
clarifies the term ``sole manufacturer'' with respect to postmarketing 
reporting requirements of products subject to section 506C. The 
clarification in terminology captures additional manufacturers as 
``sole manufacturers'' by explicitly linking the definition of sole 
manufacturer to a specific strength, dosage form, or route of 
administration of a drug product. Requiring notification of temporary 
discontinuances and clarifying the term sole manufacturer will result 
in FDA receiving better and more timely information on a wider range of 
discontinuances. This increased reporting will enable FDA to distribute 
information on discontinuances to appropriate physician and patient 
organizations and to work with manufactures and other stakeholders to 
try to prevent a discontinuance from leading to a drug shortage, or to 
mitigate the impacts of an unavoidable drug shortage on patients and 
healthcare providers.
    There is evidence that the negative impact of drug shortages could 
be significant. For instance, the American Society of Health System 
Pharmacists (ASHP) reported that annual labor costs to manage drug 
shortages are approximately $216 million in the United States (Ref. 7). 
Moreover, drugs in several major therapeutic classes are in shortage, 
including oncology products, antibiotics, and electrolyte/nutrition 
products. For example, statistics indicate that cancer alone affects 
more than 11 million people in the United States (Ref. 8). Therefore, 
the potential benefits of the interim final rule as a result of 
prevention or mitigation of these drug shortages could be substantial 
from both an economic and public health viewpoint. Because the shortage 
of even one critical drug can impact a large number of patients and 
healthcare providers, the potential benefits could be substantial even 
if the interim final rule only results in a small number of additional 
notifications of discontinuances to the Agency.

D. Costs

    Currently, FDA receives one mandatory notification that meets the 
statutory and regulatory criteria of a section 506C discontinuance per 
year and zero certifications of good cause. In addition, there are 
several dozen voluntary submissions of information to FDA that are 
related to section 506C discontinuances but do not meet the applicable 
statutory criteria, as implemented by the current regulation. We note 
that as a result of FDA's letter to industry (Ref. 10), FDA has 
experienced a significant increase in the number of notifications. We 
estimate that the total number of manufacturers who would be required 
to notify us of a discontinuance under the interim final rule would be 
80 per year.\1\ However, the impact of the interim final rule 
represents the incremental impact, which is the difference between the 
total number of reports required by the interim final rule and the 
baseline, i.e., the estimated number of reports that we would receive 
without the interim final rule. We estimate that as a result of the 
interim final rule, we will receive an additional 9 to 24 notifications 
of section 506C discontinuances (both temporary and permanent 
discontinuances) and 2 to 5 associated certifications of good cause. In 
the 2007 Preamble, we estimated that it would take two hours to prepare 
a notification of discontinuance and 16 hours to prepare a 
certification of good cause (72 FR 58993 at 58999). Since neither the 
format nor the content of these submissions will change as a result of 
the interim final rule, we continue to estimate that it will take two 
hours to prepare a notification of discontinuance and 16 hours to 
prepare a certification of good cause. We estimate that it will take 
longer to prepare a certification of good cause than a notification of 
discontinuance because preparing a certification of good cause requires 
a detailed narrative justifying a reduction in the notification period, 
which is more labor intensive than the simpler notification of 
discontinuance.
---------------------------------------------------------------------------

    \1\ The total is estimated based on 220 shortages tracked by 
FDA's CDER Drug Shortages Coordinator from January through October 
of 2011, of which we estimate 30 percent would relate to 
discontinuances subject to mandatory reporting under section 506C 
and this interim final rule. The estimated number of discontinuances 
subject to mandatory reporting (220 x 30 percent) is then adjusted 
to include two additional months of reporting.
---------------------------------------------------------------------------

    Notifications are generally prepared and submitted by a regulatory 
affairs manager. Thus, labor hours are valued using the median hourly 
wage for Management Occupations (occupation code 11-0000) in 
Pharmaceutical and Medicine Manufacturing (North American Industry 
Notification, NAICS, code 325400) as reported by the Bureau of Labor 
Statistics 2010 Employment Occupational Statistics (Ref. 9). The median 
hourly wage is $117, which is adjusted for benefits and overhead.
    The estimated cost is $234 ($117 x 2 hours) per notification of 
discontinuance, and $1,872 ($117 x 16 hours) per certification of good 
cause. In table 1 below we present the estimated costs. The estimated 
annual cost of the interim final rule is between $5,850 and $15,064.

                 Table 1--Estimated Additional Annual Reporting Costs of the Interim Final Rule
----------------------------------------------------------------------------------------------------------------
                                                         Number of
                   Type of response                      additional   Hours per     Cost per    Total estimated
                                                         responses     response     response          cost
----------------------------------------------------------------------------------------------------------------
Notification of Discontinuance (Sec.                           9-24            2         $234      $2,106-$5,704
 314.81(b)(3)(iii))...................................
Certification of Good Cause (Sec.   314.91)...........          2-5           16       $1,872       $3,744-9,360
                                                       ---------------------------------------------------------
    Total.............................................  ...........  ...........  ...........     $5,850-$15,064
----------------------------------------------------------------------------------------------------------------

E. Analysis of Regulatory Alternatives

    The interim final rule will result in the submission of additional 
notifications to FDA of a discontinuance of a drug product subject to 
section 506C. As noted in FDA's recent report on medical product 
shortages (Ref. 5), any system that increases reporting must ensure 
that, in the pursuit of more ``signal,'' FDA is not overwhelmed with 
``noise.'' We welcome comments on how the notifications can be designed 
in line with this principle. Such an approach is consistent with 
Section 4 of Executive Order 13563, which calls

[[Page 78536]]

upon agencies ``to identify and consider regulatory approaches that 
reduce burdens and maintain flexibility and freedom of choice for the 
public.'' FDA identified the following alternatives to the interim 
final rule: (1) No change in regulation; and (2) publish guidance that 
encourages sole manufacturers (including manufacturers of specific 
strengths, dosage forms, and routes of administration) to notify FDA 
about temporary discontinuances of drug products subject to the rule, 
and (3) provide incentives for voluntary reporting.
1. Alternative 1: No Change in Regulation
    A simple alternative would be to leave the current regulation 
unchanged. While this alternative may not impose additional costs on 
sole manufacturers of drug products subject to section 506C, the 
benefits of this option would be uncertain and would not provide any 
additional tools to reduce the number of product shortages.
2. Alternative 2: Publish Guidance
    FDA could draft additional guidance to encourage voluntary 
notification of upcoming discontinuances. A recent example is a FDA's 
letter to industry (Ref. 10). However, such communications and guidance 
cannot impose new regulatory requirements. Without this regulation 
defining which manufacturers are required to notify FDA about both 
temporary and permanent discontinuances of drug products subject to 
section 506C, FDA may not have adequate information to distribute to 
physician and patient organizations and to work effectively with 
manufacturers and other stakeholders to better prevent and mitigate 
drug shortages.
3. Alternative 3: Provide Incentives for Voluntary Reporting
    It may be possible to develop a system of incentives to encourage 
increased reporting on a voluntary basis. FDA welcomes comments from 
the public on how such a system could be implemented, including the 
types of incentives that would advance the FDA's mission to protect the 
public health while encouraging additional reporting.

F. Regulatory Flexibility Analysis

    FDA has examined the economic implications of the interim final 
rule as required by the Regulatory Flexibility Act. The Agency projects 
that the interim final rule will not likely have a significant economic 
impact on a substantial number of small entities, but seeks comment on 
its analysis below.
1. Economic Effect on Small Entities
    The Small Business Administration (SBA) uses different definitions 
of what a small entity is for different industries. Using SBA standard 
size definitions, a firm categorized in NAICS code 315412 
(Pharmaceutical Preparations) or NAICS code 325414 (Biological 
Products) is considered small if it employs fewer than 750 or 500 
people, respectively (Ref. 11). The most currently available data from 
the 2007 Economic Census (Ref. 12) show that at least 92 percent of 
these establishments would be considered small by SBA standards.\2\ We 
note that using data at the establishment level implicitly assumes that 
the typical manufacturing establishment is roughly equivalent to the 
typical small manufacturing firm.
---------------------------------------------------------------------------

    \2\ For NAICS code 325412, total value of shipments data are not 
available for establishments employing fewer than 750 employees. The 
estimated percent of small establishments (92 percent) is based on 
the total number of establishments with fewer than 500 employees. 
For NAICS code 324514 the percent of establishments with fewer than 
750 employees is 96 percent.
---------------------------------------------------------------------------

    We estimate that the cost per response as a percent of average 
sales for manufacturers in NAICS code 325412 could represent up to 
0.002 percent of sales. The greatest impact is on establishments hiring 
fewer than 10 employees, where the cost per response as a percent of 
average sales ranges from 0.029 percent to 0.235 percent. The analysis 
of the effect on small versus large entities for NAICS 312314 is 
limited by data restrictions imposed to safeguard the confidentially of 
some establishments. Consequently, for NAICS code 312314 the average 
value of shipments is only presented for all establishments. We 
estimate that the cost per response as a percent of average sales in 
this industry is between 0.001 percent and 0.004 percent (see table 2). 
Therefore, the Agency concludes that this rule will not likely have a 
significant impact on a substantial number of small entities, but we 
request comments on our analysis.

                                       Table 2--Estimated Economic Impact of Interim Final Rule on Small Entities
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         Cost per response as a percent of average sales
                                                                                       Average value of ------------------------------------------------
              Number of employees                   Number of        Total value of       shipments       ($234 per response--    ($1,872 per response--
                                                  establishments    shipments ($000)       ($1,000)          notification of      certification of good
                                                                                                           discontinuance) (%)          cause) (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
NAICS Code 325412:
0-9...........................................                408            324,604                796                 0.029                   0.235
    10-19.....................................                 77            317,551              4,124                 0.006                   0.045
    20-99.....................................                249          8,377,347             33,644                 0.001                   0.006
    100-499...................................                182         32,516,961            178,665                 0.000                   0.001
    500 and over..............................                 75         68,162,155            908,829                 0.000                   0.000
                                               ---------------------------------------------------------------------------------------------------------
        All...................................                991        109,698,618            110,695                 0.000                   0.002
NAICS Code 325414:
        All...................................                350         16,112,435             46,036                 0.001                   0.004
--------------------------------------------------------------------------------------------------------------------------------------------------------

2. Additional Flexibility Identified
    In this section, we identify alternatives that would present 
reductions in costs to small entities.
    Alternative 1: Exempt Small-sized Entities: Exempting small-sized 
businesses from the interim final rule would reduce the economic impact 
to small businesses by up to 0.235 percent of average sales. However, 
not imposing these notification requirements on drug products subject 
to section 506C could

[[Page 78537]]

exacerbate the increasing trend in drug shortages that affect a 
substantial number of patients and healthcare providers. Moreover, 
these reporting requirements enable FDA to distribute information to 
physician and patient organizations, to assess potential drug 
shortages, and to evaluate mitigation strategies. Thus, exempting small 
business entities may in the long-term lead to high social costs 
associated with outcomes such as worsening of conditions for patients 
for whom these products are necessary.
    Alternative 2: Extend the Compliance Period for Small Businesses: 
An alternative to reduce costs would be to extend the compliance period 
for small-sized entities. While a longer compliance period may enable 
small businesses to reduce labor costs, it would delay FDA's receipt of 
notices of discontinuance and limit the Agency's ability to distribute 
information to physician and patient organizations as required by 
section 506C(c), to assess potential drug shortages, and to work with 
manufacturers and other stakeholders to prevent or mitigate shortages.

V. Paperwork Reduction Act of 1995

    This interim final rule contains information collection provisions 
that are subject to review by OMB under the Paperwork Reduction Act of 
1995 (44 U.S.C. 3501-3520) (the PRA). The title, description, and 
respondent description of these provisions are shown below with an 
estimate of the annual reporting burden. Included in the estimate is 
the time for reviewing instructions, searching existing data sources, 
gathering and maintaining the data needed, and completing and reviewing 
each collection of information.
    FDA invites comments on: (1) Whether the proposed collections of 
information are necessary for the proper performance of FDA's 
functions, including whether the information will have practical 
utility; (2) the accuracy of FDA's estimate of the burden of the 
proposed collections of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility and clarity of the information to be collected; and (4) ways to 
minimize the burden of the collections of information on respondents, 
including through the use of automated collection techniques, when 
appropriate, or other forms of information technology.
    Title: Applications for Food and Drug Administration Approval to 
Market a New Drug; Revision of Postmarketing Reporting Requirements--
Discontinuance.
    Description: Sections 314.81(b)(3)(iii) and 314.91 of FDA's 
regulations (``Sec.  314.81(b)(3)(iii)'' and ``Sec.  314.91'', 
respectively) implement section 506C. Section 314.81(b)(3)(iii) 
requires entities who are the sole manufacturers of certain drug 
products to notify us at least 6 months before discontinuance of 
manufacture of the product. For the regulations to apply, a product 
must meet the following three criteria:
    1. The product must be life supporting, life sustaining, or 
intended for use in the prevention of a debilitating disease or 
condition;
    2. The product must have been approved by FDA under section 505(b) 
or 505(j) of the Federal Food, Drug, and Cosmetic Act; and
    3. The product must not have been originally derived from human 
tissue and replaced by a recombinant product.
    Under Sec.  314.81(b)(3)(iii)(c), we will publicly disclose 
information about drug products subject to section 506C that are to be 
discontinued. Section 314.91 allows us to reduce the 6-month 
notification period if we find that good cause exists for the 
reduction. A manufacturer may request that we reduce the notification 
period by certifying that good cause for the reduction exists.
    In the October 18, 2007 final rule (72 FR 58993), we added 
Sec. Sec.  314.81(b)(3)(iii) and 314.91 to our regulations. Sections 
314.81(b)(3)(iii) and 314.91 require two new reporting requirements to 
FDA that are subject to OMB approval under the PRA: Notification of 
Discontinuance and Certification of Good Cause. The interim final rule 
adds two new definitions to Sec.  314.81(b)(3)(iii): ``discontinuance'' 
and ``sole manufacturer.'' The interim final rule clarifies the scope 
of manufacturers required to report and expands the range of 
circumstances required to be reported to the Agency under Sec.  
314.81(b)(3)(iii), but does not change the substantive content of the 
reports required to be submitted to the Agency. This PRA analysis 
covers the information collection resulting from the October 18, 2007 
final rule and also includes our estimates of how the number of 
Notifications of Discontinuance and Certifications of Good Cause may 
increase as a result of this interim final rule. Accordingly, the 
estimates included in the Analysis of Impacts will not directly match 
the estimates in the PRA analysis because the PRA analysis represents 
an estimate of the total reporting burden under Sec. Sec.  
314.81(b)(3)(iii) and 314.91, while the Analysis of Impacts examines 
only the increased costs and benefits as a result of the interim final 
rule.

A. Notification of Discontinuance

    Under Sec.  314.81(b)(3)(iii), at least 6 months before a sole 
manufacturer intends to discontinue manufacture of a drug product 
subject to section 506C, the manufacturer must send us notification of 
the discontinuance. The notification of discontinuance generally 
contains the name of the manufacturer, the name of the product to be 
discontinued, the reason for the discontinuance, and the date of 
discontinuance. We will work with relevant manufacturers during the 6-
month notification period to help minimize the effect of the 
discontinuance on patients and health care providers, and to distribute 
appropriate information about the discontinuance to physician and 
patient organizations. The interim final rule adds definitions of 
``discontinuance'' and ``sole manufacturer'' to Sec.  
314.81(b)(3)(iii). The inclusion of these definitions expands 
notification requirements under Sec.  314.81(b)(3)(iii) to additional 
discontinuance circumstances and clarifies the scope of manufacturers 
who must report discontinuances. The interim final rule also requires 
that notifications of discontinuance be submitted either electronically 
or by telephone according to instructions on FDA's Drug Shortage Web 
site at http://www.fda.gov/Drugs/DrugSafety/DrugShortages. This change 
ensures that the appropriate offices are timely notified of all 
relevant discontinuances. It also reflects existing practice for 
submitting notices of discontinuance, and reduces the burden on 
industry to submit multiple copies of the notification.

B. Certification of Good Cause

    We may reduce the 6-month notification period if we find good cause 
for the reduction. As described in Sec.  314.91, a manufacturer can 
request a reduction in the notification period by submitting written 
certification that good cause exists to the following designated 
offices: (1) The CDER Drug Shortage Coordinator at the address of the 
Director of CDER; (2) the CDER Drug Registration and Listing Team, 
Division of Compliance Risk Management and Surveillance in CDER; and 
(3) the director of either the CDER division or the CBER office that is 
responsible for reviewing the application. The following circumstances 
may establish good cause:
     A public health problem may result from continuation of 
manufacturing for the 6-month period (Sec.  314.91(d)(1));

[[Page 78538]]

     A biomaterials shortage prevents the continuation of 
manufacturing for the 6-month period (Sec.  314.91(d)(2));
     A liability problem may exist for the manufacturer if the 
manufacturing is continued for the 6-month period (Sec.  314.91(d)(3));
     Continuation of the manufacturing for the 6-month period 
may cause substantial economic hardship for the manufacturer (Sec.  
314.91(d)(4));
     The manufacturer has filed for bankruptcy under chapter 7 
or 11 of title 11, United States Code (Sec.  314.91(d)(5));
     The manufacturer can stop making the product but still 
distribute it to satisfy existing market need for 6 months (Sec.  
314.91(d)(6)); or
     Other good cause exists for a reduction in the 
notification period (Sec.  314.91(d)(7)).
    With each certification described previously, the manufacturer must 
describe in detail the basis for its conclusion that such circumstances 
exist. We require that the written certification that good cause exists 
be submitted to the offices identified previously to ensure that our 
efforts to address the discontinuance take place in a timely manner. 
The interim final rule makes no changes to the requirements or process 
for certification of good cause.
    Description of Respondents: An applicant that is the sole 
manufacturer and who is discontinuing manufacture of a drug product 
that meets the following criteria: (1) Is life supporting, life 
sustaining, or intended for use in the prevention of a debilitating 
disease or condition; (2) was approved by FDA under section 505(b) or 
(j) of the Federal Food, Drug, and Cosmetic Act; and (3) was not 
originally derived from human tissue and replaced by a recombinant 
product.
    Burden Estimate: Table 3 of this document provides an estimate of 
the annual reporting burden for notification of a product 
discontinuance and certification of good cause under Sec. Sec.  
314.81(b)(3)(iii) and 314.91, as amended by this interim final rule.
    Notification of Discontinuance: Based on data collected from the 
CDER Drug Shortage Coordinator since December 17, 2007, when Sec. Sec.  
314.81(b)(3)(iii) and 314.91 went into effect, one manufacturer during 
each year reported to FDA a discontinuance of one drug product meeting 
the criteria of section 506C and its implementing regulations (i.e., 
the drug product was approved under section 505(b) or (j) of the 
Federal Food, Drug, and Cosmetic Act, the drug product was ``life-
supporting, life-sustaining or intended for use in the prevention of a 
debilitating disease or condition,'' the drug product was produced by a 
sole manufacturer, and the drug product was permanently discontinued). 
CDER's Drug Shortages Coordinator tracked 220 drug shortages between 
January and October of 2011. The Agency estimates that 30 percent (66) 
of these shortages would relate to discontinuances subject to mandatory 
reporting under section 506C as a result of the interim final rule. 
Adjusting to include an additional two months of reporting (November 
and December), we estimate that FDA will receive a total of 80 
notifications of a discontinuance per year under section 506C, as 
amended by the interim final rule. Based on experience, a manufacturer 
submits only one notification of a discontinuance per year, thus the 
total number of manufacturers who would be required to notify us of a 
discontinuance would be 80. Therefore, the number of respondents is 
estimated to be 80. The hours per response is the estimated number of 
hours that a respondent would spend preparing the information to be 
submitted with a notification of product discontinuance, including the 
time it takes to gather and copy the statement. Based on experience in 
working with manufacturers to submit notifications under Sec.  
314.81(b)(3)(iii), we estimate that approximately 2 hours on average 
are needed per response. We do not expect the changes in the interim 
final rule to affect the number of hours per response. Therefore, we 
estimate that respondents will spend 160 hours per year notifying us of 
a product discontinuance under these regulations.
    Certification of Good Cause: Based on data collected from the CDER 
drug shortage coordinator since 2007, one manufacturer each year 
reported a discontinuance of one drug product under section 506C and 
its implementing regulations. Each manufacturer has the opportunity 
under Sec.  314.91 to request a reduction in the 6-month notification 
period by certifying to us that good cause exists for the reduction. 
The Agency has received no certifications of good cause since 2007. 
Although we expect we will receive an increase in the number of reports 
of discontinuances as a result of the changes in the interim final 
rule, because of the limited circumstances under which good cause can 
be requested or would be appropriately granted, we do not expect a 
correspondingly large increase in the number of manufacturers 
requesting a certification of good cause. We estimate that only 5 
manufacturers will request a certification of good cause each year. 
Therefore, the number of respondents is estimated to be 5. The total 
annual responses are the total number of certifications of good cause 
that are expected to be submitted to us in a year. We estimate that the 
total annual responses will remain small, averaging one response per 
respondent. The hours per response is the estimated number of hours 
that a respondent spends preparing the detailed information certifying 
that good cause exists for a reduction in the notification period, 
including the time it takes to gather and copy the documents. We 
estimate that approximately 16 hours on average are needed per 
response. Therefore, we estimate that 80 hours will be spent per year 
by respondents certifying that good cause exists for a reduction in the 
6- month notification period under Sec.  314.91.

                                 Table 3--Estimated Annual Reporting Burden \1\
----------------------------------------------------------------------------------------------------------------
                                                     Number of
         21 CFR Section              Number of     responses per   Total annual      Hours per      Total hours
                                    respondents     respondent       responses       response
----------------------------------------------------------------------------------------------------------------
Notification of Discontinuance..              80               1              80               2             160
(314.81(b)(3)(iii)).............
Certification of Good Cause                    5               1               5              16              80
 (314.91).......................
                                 -------------------------------------------------------------------------------
    Total.......................             240
----------------------------------------------------------------------------------------------------------------
\1\ There are no capital costs or operating and maintenance costs associated with this collection of
  information.

[[Page 78539]]

    The information collection provisions for this interim final rule 
have been submitted to OMB for emergency review under the Paperwork 
Reduction Act of 1995. An agency may not conduct or sponsor, and a 
person is not required to respond to, a collection of information 
unless it displays a currently valid OMB control number.
    Interested persons are requested to fax comments regarding the 
information collection to the Office of Information and Regulatory 
Affairs, OMB. To ensure that comments on the information collection are 
received, OMB recommends that written comments be faxed to the Office 
of Information and Regulatory Affairs, OMB, Attn: FDA Desk Officer, 
FAX: (202) 395-5806, or emailed to OIRA_submission@omb.eop.gov. All 
comments should be identified with the title, ``Applications for Food 
and Drug Administration Approval to Market a New Drug; Revision of 
Postmarketing Reporting Requirements--Discontinuance.''

VI. Federalism

    FDA has analyzed this interim final rule in accordance with the 
principles set forth in Executive Order 13132. FDA has determined that 
the rule does not contain policies that have substantial direct effects 
on the States, on the relationship between the National Government and 
the States, or on the distribution of power and responsibilities among 
the various levels of government. Accordingly, the Agency has concluded 
that the rule does not contain policies that have federalism 
implications as defined in the Executive order and, consequently, a 
federalism summary impact statement is not required.

VII. Environmental Impact

    The Agency has determined under 21 CFR 25.30(h) 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.

VIII. Comments

    Interested persons may submit to the Division of Dockets Management 
(see ADDRESSES) either electronic or written comments regarding this 
document. It is only necessary to send one set of comments. It is no 
longer necessary to send two copies of mailed comments. Identify 
comments with the docket number found in brackets in the heading of 
this document. Received comments may be seen in the Division of Dockets 
Management between 9 a.m. and 4 p.m., Monday through Friday.

IX. References

    The following references are on display in the Division of Dockets 
Management (see ADDRESSES) and may be seen by interested persons 
between 9 a.m. and 4 p.m., Monday through Friday. (FDA has verified all 
Web site addresses, but FDA is not responsible for any subsequent 
changes to the Web site after this document publishes in the Federal 
Register).

    1. Institute for Safe Medication Practices. Drug Shortages: 
National Survey Reveals High Level of Frustration, Low Level of 
Safety. ISMP Medication Safety Alert. Sept 23, 2010, available at 
http://www.ismp.org/newsletters/acutecare/articles/20100923.asp, 
accessed December 2011.
    2. Executive Order 13588, Reducing Prescription Drug Shortages, 
October 31, 2011, available at http://www.gpo.gov/fdsys/pkg/FR-2011-11-03/pdf/2011-28728.pdf accessed December 2011.
    3. Center for Drug Evaluation and Research, Manual of Policies 
and Procedures 6003.1, Drug Shortage Management, September 26, 2006, 
available at http://www.fda.gov/downloads/AboutFDA/CentersOffices/CDER/ManualofPoliciesProcedures/ucm079936.pdf, accessed December 
2011.
    4. Webster's Third New International Dictionary of the English 
Language Unabridged, 2002, defining ``discontinuance.''
    5. Food and Drug Administration. A Review of FDA's Approach to 
Medical Product Shortage, October 31, 2011, available at http://www.fda.gov/AboutFDA/ReportsManualsForms/Reports/ucm275051.htm, 
accessed December 2011.
    6. American Hospital Association. AHA Survey on Drug Shortages, 
available at http://www.aha.org/aha/content/2011/pdf/drugshortagesurvey.pdf, accessed December 2011.
    7. Department of Health and Human Services. Assistant Secretary 
for Planning and Evaluation. Economic Analysis of the Causes of Drug 
Shortages, October 2011, available at http://aspe.hhs.gov/sp/reports/2011/DrugShortages/ib.shtml, accessed December 2011.
    8. American Cancer Society. Cancer Facts & Figures 2011. 
Atlanta: American Cancer Society; 2011, available at http://www.cancer.org/acs/groups/content/@epidemiologysurveilance/documents/document/acspc-029771.pdf, accessed December 2011.
    9. Bureau of Labor Statistics. National Occupational Employment 
and Wage Estimates. Occupational Employment Statistics, May 2010, 
available at http://www.bls.gov/oes/current/oes_nat.htm, accessed 
December 2011.
    10. Food and Drug Administration. Letter to Industry, October 
31, 2011, available at http://www.fda.gov/Drugs/DrugSafety/DrugShortages/ucm277675.htm, accessed December 2011.
    11. Small Business Administration. Table of Small Business Size 
Standards Matched to North American Industry Classification System 
Codes. November 2010, available at http://www.sba.gov/sites/default/files/Size_Standards_Table.pdf, accessed December 2011.
    12. United States Census Bureau. 2007 Economic Census. Sector 
31: Manufacturing: General Summary: Industry Statistics for 
Subsectors and Industries by Employment Size: 2007, available at 
http://factfinder.census.gov/servlet/IBQTable?_bm=y&-geo_id=&-fds_name=EC0700A1&-ds_name=EC0731SG3&-_lang=en, accessed December 
2011.

List of Subjects in 21 CFR Part 314

    Administrative practice and procedure, Confidential business 
information, Drugs, Reporting and recordkeeping requirements.

    Therefore, under the Federal Food, Drug, and Cosmetic Act, the 
Public Health Service Act, and under authority delegated to the 
Commissioner of Food and Drugs, 21 CFR part 314 is amended as follows:

PART 314--APPLICATIONS FOR FDA APPROVAL TO MARKET A NEW DRUG

0
1. The authority citation for 21 CFR part 314 continues to read as 
follows:

    Authority: 21 U.S.C. 321, 331, 351, 352, 353, 355, 356, 356a, 
356b, 356c, 371, 374, 379e.

0
2. In Sec.  314.81, paragraph (b)(3)(iii)(a) is amended by removing the 
phrase ``discontinuing manufacture'' and adding in its place the phrase 
``discontinuance of manufacture''; by revising paragraph 
(b)(3)(iii)(b); and by adding new paragraph (b)(3)(iii)(d) to read as 
follows:

Sec.  314.81  Other postmarketing reports.

* * * * *
    (b) * * *
    (3) * * *
    (iii) * * *
    (b) Notifications required by paragraph (b)(3)(iii)(a) of this 
section must be submitted to FDA either electronically or by phone 
according to instructions on FDA's Drug Shortages Web site at: http://www.fda.gov/Drugs/DrugSafety/DrugShortages.
* * * * *
    (d) For purposes of this section and Sec.  314.91, the terms 
``discontinuance'' and ``sole manufacturer'' are defined as follows:
    Discontinuance means any interruption in manufacturing of a drug 
product described in paragraph (b)(3)(iii)(a) of this section for sale 
in the United States that could lead to a potential disruption in 
supply of the drug product, whether the interruption

[[Page 78540]]

is intended to be temporary or permanent.
    Sole manufacturer means an applicant that is the only entity 
currently manufacturing a drug product of a specific strength, dosage 
form, or route of administration for sale in the United States, whether 
the product is manufactured by the applicant or for the applicant under 
contract with one or more different entities.
* * * * *

    Dated: December 13, 2011.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2011-32354 Filed 12-15-11; 8:45 am]
BILLING CODE 4160-01-P