Source: https://www.federalregister.gov/articles/2011/12/19/2011-32354/applications-for-food-and-drug-administration-approval-to-market-a-new-drug-revision-of
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Matched Legal Cases: ['§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314', '§ 314']

Federal Register | Applications for Food and Drug Administration Approval To Market a New Drug; Revision of Postmarketing Reporting Requirements-Discontinuance
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).
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Shorter URL: https://federalregister.gov/a/2011-32354 Related Topics
Applications for Food and Drug Administration Approval to Market a New Drug; Revision of Postmarketing Reporting Requirements--Discontinuance
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 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 § 314.81(b)(3)(iii) (21 CFR 314.81(b)(3)(iii)), which, in addition to § 314.91 (21 CFR 314.91), implements section 506C of the Federal Food, Drug, and Cosmetic Act.
II. Overview of the Interim Final Rule Back to Top
The interim final rule therefore adds § 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).
Manufacturing shut-downs for maintenance or other routine matters, if the shut-down extends for longer than anticipated or otherwise could disrupt supply of a drug 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 § 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 § 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.
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] 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 § 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 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 Regulatory Flexibility Act requires agencies to analyze regulatory 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.
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. 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.
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.
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.
Table 1—Estimated Additional Annual Reporting Costs of the Interim Final Rule Back to Top
Notification of Discontinuance (§ 314.81(b)(3)(iii))
$2,106-$5,704
Certification of Good Cause (§ 314.91)
$3,744-9,360
$5,850-$15,064
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 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.
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.
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.
Table 2—Estimated Economic Impact of Interim Final Rule on Small Entities Back to Top
8,377,347
32,516,961
109,698,618
16,112,435
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 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.
Description: Sections 314.81(b)(3)(iii) and 314.91 of FDA's regulations (“§ 314.81(b)(3)(iii)” and “§ 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:
Under § 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 §§ 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 § 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 § 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 §§ 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.
Under § 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 § 314.81(b)(3)(iii). The inclusion of these definitions expands notification requirements under § 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.
We may reduce the 6-month notification period if we find good cause for the reduction. As described in § 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 (§ 314.91(d)(1)); A biomaterials shortage prevents the continuation of manufacturing for the 6-month period (§ 314.91(d)(2));
Other good cause exists for a reduction in the notification period (§ 314.91(d)(7)).
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 §§ 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 §§ 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 § 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 § 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 § 314.91.
Notification of Discontinuance (314.81(b)(3)(iii))
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.
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&amp;-geo_id=&amp;-fds_name=EC0700A1&amp;-ds_name=EC0731SG3&amp;-_lang=en, accessed December 2011.
2.In § 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: § 314.81 Other postmarketing reports.
(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 § 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 is intended to be temporary or permanent.