[Federal Register Volume 63, Number 226 (Tuesday, November 24, 1998)]
[Proposed Rules]
[Pages 64930-64937]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31351]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 1

[Docket No. 98N-0496]
RIN 0910-AB24


Import for Export; Reporting and Recordkeeping Requirements for 
Unapproved or Violative Products Imported for Further Processing or 
Incorporation and Subsequent Export

AGENCY: Food and Drug Administration, HHS.

ACTION: Proposed rule.

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SUMMARY: The Food and Drug Administration (FDA) is proposing reporting 
and recordkeeping regulations to implement certain sections of the 
Federal Food, Drug, and Cosmetic Act (the act) as amended by the FDA 
Export Reform and Enhancement Act of 1996. The proposed rule would 
require an importer to report to FDA each time it imports an unapproved 
or otherwise violative article that is to be exported after further 
processing or incorporation into another product in the United States 
and to keep records to ensure that the article is so processed or 
incorporated and then exported, and that any portion of the import that 
is not exported is destroyed.
DATES: Submit written comments by February 8, 1999. Written comments on 
the information collection requirements should be submitted by December 
24, 1998.

ADDRESSES: Submit written comments to the Dockets Management Branch 
(HFA-305), Food and Drug Administration, 5630 Fishers Lane, rm. 1061, 
Rockville, MD 20852. Submit written comments on the information 
collection requirements to the Office of Information and Regulatory 
Affairs, OMB, New Executive Office Bldg., 725 17th St. NW., Washington, 
DC 20503. Attn: Desk Officer for FDA.

FOR FURTHER INFORMATION CONTACT:
    For general information: Marvin A. Blumberg, Division of Import 
Operations and Policy (HFC-171), Food and Drug Administration, 5600 
Fishers Lane, Rockville, MD 20857, 301-443-6553.
    For information concerning blood products: Kimberly A. Cressotti, 
Division of Case Management (HFM-610), Center for Biologics Evaluation 
and Research, Food and Drug Administration, 1401 Rockville Pike, suite 
200N, Rockville, MD 20852-1448, 301-827-6201.
SUPPLEMENTARY INFORMATION:

I. Background

    The FDA Export Reform and Enhancement Act of 1996 (Pub. L. 104-134, 
amended by Pub. L. 104-180, August 6, 1996) became law on April 26, 
1996. One provision of the new law, now codified at section 801(d)(3) 
of the act (21 U.S.C 381 (d)(3)), allows importation of any component 
of a drug, component part or accessory of a device, or other article of 
device requiring further processing, and any food or color additive, or 
dietary supplement, if it is to be further processed or incorporated 
into a product that is to be exported from the United States by the 
initial owner or consignee in accordance with section 801(e) or 802 of 
the act (21 U.S.C 382), or section 351(h) of the PHS Act (42 U.S.C. 262 
(h)). (For purposes of section 801(d) of the act, FDA interprets the 
term ``component'' broadly to include anything used in, or in the 
manufacture of, a drug, biologic, or device, as well as a finished 
final product that will be further processed in the United States. 
Thus, for example, the term includes bulk drugs, unapproved foreign 
versions of drugs approved for use in the United States, active and 
inactive ingredients of a drug or biologic, pieces of a device, and 
completed devices.) Under section 801(d)(3) of the act, the initial 
owner or consignee must submit a statement regarding the imported 
article to FDA at the time of initial importation. Any component of a 
drug; any component, part, article, or accessory of a device; any food 
additive, color additive; or any dietary supplement imported under 
section 801(d) of the act that is not incorporated or further processed 
by the initial owner or consignee must be destroyed or exported (see 
section 801(d)(3)(C) of the act). Section 801(d)(3)(B) of the act 
further requires the initial owner or consignee to maintain records 
identifying the use and exportation or disposition of the imported 
article, including portions that were destroyed, and, upon request from 
FDA, to submit a report that accounts for the exportation or 
disposition of the imported article and the manner in which the initial 
owner or consignee complied with the requirements in section 801(d) of 
the act.
    This provision of the act is generally known as the ``import-for-
export'' provision.
    Another new provision, now codified at section 801(d)(4) of the 
act, places additional requirements on the import-for-export of blood, 
blood components, source plasma, source leukocytes, or a component, 
accessory, or part (hereinafter referred to as ``blood products''), and 
of tissue and components or parts of tissue. Section 801(d)(4) of the 
act prohibits the importation of blood products unless they comply with 
section 351(a) of the PHS Act or FDA permits the importation under FDA-
determined appropriate circumstances and conditions. (Section 351(a) of 
the PHS Act pertains to the licensing of biological products.)
    Section 801(d)(4) of the act also prohibits the importation of 
tissues and their components, under section 801(d)(3) of the act, 
unless the importation complies with section 361 of the PHS Act (42 
U.S.C. 264). Section 361 of the PHS Act authorizes FDA to issue 
regulations to control communicable disease, and, for human tissues 
intended for transplantation, these regulations are found at part 1270 
(21 CFR part 1270). FDA, therefore, interprets section 801(d)(4) of the 
act as meaning that a person importing human tissue for transplantation 
for further processing or incorporation into a product destined for 
export must comply with part 1270. Under Sec. 1270.42 published in the 
Federal Register of July 29, 1997 (62 FR 40429), the importer of record 
must notify the director of the FDA district having jurisdiction over 
the port of entry or notify his or her designee, and the human tissue 
must be quarantined until released by FDA.
    Human tissue intended for transplantation may be imported and 
further processed or incorporated into other products without meeting 
the screening and testing requirements of part 1270 if the human tissue 
is kept in quarantine at all times (see Sec. 1270.3

[[Page 64931]]

(definition of ``quarantine'')). However, as indicated in Sec. 1270.31 
(62 FR 40429, July 29, 1997), the owner or consignee in the United 
States must prepare and follow written procedures for designating and 
identifying quarantined human tissue and preventing infectious disease 
contamination or cross-contamination during processing.
    FDA considers live animal cells, tissues, and organs intended to be 
transplanted, implanted, or used for ex-vivo perfusion in humans 
(xenogeneic products) to be biological products. Nonliving animal 
cells, tissues, and organs intended for transplantation or implantation 
into humans may be either biological products or devices. Animal cells, 
tissues, and organs imported into the United States under section 
801(d) of the act which FDA considers to be biological products or 
devices would be expected to comply with proposed Sec. 1.84(b).
    All veterinary biologics (e.g., vaccines, bacterins, allergens, 
antibodies, antitoxins, toxoids, etc.) and animal-origin materials that 
could represent a disease risk to U.S. livestock, including animal 
products, by-products, and biological materials that contain or have 
been in contact with certain organisms or animal materials) are 
regulated by the U.S. Department of Agriculture's (USDA) Animal and 
Plant Health Inspection Service. An importer must obtain a USDA permit 
before importing any of these materials.
    The proposed rule would establish the requirements for requesting a 
determination from FDA to allow importation of blood products, and 
would establish reporting, labeling, and recordkeeping requirements for 
all imported articles under the import-for-export provision. These 
would be the minimum requirements necessary to comply with the import-
for-export provision in the act and are intended to enable the importer 
to ensure, and the agency to monitor, that imported substances are 
further processed or incorporated into one of the specified FDA-
regulated products while in the United States, and are then exported or 
destroyed without entering domestic commerce. Although the act does not 
define the term ``further processed,'' given the legislative intent to 
allow manufacturing and processing activities not previously permitted 
under the act, FDA interprets the term ``further processed'' to cover a 
wide range of activities, including packaging or labeling of finished 
products and specialized processing (such as sterilization) of a 
product. However, the agency does not consider a product to be 
``further processed'' if it is merely stored in the United States 
before being exported elsewhere.

II. Description of the Proposed Rule

A. Request for Determination Regarding the Importation of Blood, Blood 
Components, Source Plasma, Source Leukocytes, or Their Components, 
Accessories, or Parts

    As stated earlier, section 801(d)(4) of the act prohibits the 
importation of blood, blood components, source plasma, or source 
leukocytes, or ``a component, accessory, or part thereof,'' unless they 
comply with section 351(a) of the PHS Act or meet ``appropriate 
circumstances and conditions'' as determined by FDA. The agency 
interprets the phrase concerning compliance with section 351(a) of the 
PHS Act as requiring products to be licensed, and also interprets 
section 801(d)(4) of the act to include blood or plasma derivatives or 
intermediates. With respect to the determination of ``appropriate 
circumstances and conditions,'' FDA interprets the phrase as applying 
to unlicensed blood products and will decide on a case-by-case basis 
whether blood products that do not comply with section 351(a) of the 
PHS Act should be allowed into the United States under section 
801(d)(4) of the act. This decision will be based, in part, on the 
agency's assessment of the adequacy of the safeguards to prevent 
diversion into U.S. commerce, contamination of, or commingling with 
products licensed or approved by FDA for use in the United States.
    Consequently, proposed Sec. 1.84(a) would describe the process for 
requesting a determination that an unlicensed blood product meets the 
appropriate circumstances and conditions to allow its importation into 
the United States. Proposed Sec. 1.84(a)(1) would require a person who 
intends to import an unlicensed blood product into the United States 
for further processing or incorporation into a product destined for 
export to request a determination from FDA before importing the blood 
product. The request, under proposed Sec. 1.84(a)(2), would contain the 
following:
    1. The names and addresses of the foreign manufacturer of the 
article to be imported and the initial owner or consignee in the United 
States that would be responsible for the further processing or 
incorporation of the article into another product;
    2. The specific identity of the article to be imported and details 
as to how it will be further processed or incorporated into a product 
for export;
    3. A description of the standard operating procedures and 
safeguards that will be used to ensure that the imported articles or 
products incorporating the imported articles are not diverted to 
domestic use in the United States and are segregated from, and not 
comingled with, products or components intended for use in the United 
States. For example, this may consist of quarantine procedures used for 
segregating imported blood, blood components, or final products from 
products intended for use in the United States and validation data for 
procedures to clean equipment and facilities used for manufacturing 
both products for use in the United States and for manufacturing 
products for export;
    4. General donor screening documentation or criteria, in English. 
The request for determination should not include individual donor 
screening questionnaires;
    5. A copy of the product label translated (if necessary) into 
English (described in greater detail below); and
    6. A certification that all blood and blood products will be tested 
for infectious disease agents such as HIV-1, HIV-2, hepatitis B virus, 
hepatitis C virus, HTLV-I, HTLV-II, and Treponema pallidum. Proposed 
Sec. 1.84(a) would permit the infectious agent tests to be performed 
using test kits other than those licensed or approved by FDA; in such 
cases, a copy of the labeling, including manufacturer's test kit 
instructions, for the test kit used, translated into English, would be 
included in the request for determination.
    Requests for determination, under proposed Sec. 1.84(a)(3), would 
be submitted to the Division of Case Management (HFM-610), Center for 
Biologics Evaluation and Research (CBER). CBER will develop procedures 
and timeframes for reviewing these requests.
    A request for determination would be submitted to and approved by 
CBER before importation of the first shipment of the unlicensed 
biological product. Once CBER has approved a request for determination, 
future shipments of the same product may be imported for export without 
an additional request for determination so long as the importer, 
consignee, and all other conditions upon which the determination was 
based remain unchanged.
    Proposed Sec. 1.84(a)(4) would require the initial owner or 
consignee to maintain records regarding the request for determination 
and to make those records available to FDA upon request.

[[Page 64932]]

    Under proposed Sec. 1.84(a)(5), FDA would notify, in writing, the 
person requesting the determination if the agency grants permission to 
import the blood product.
    These proposed regulations for blood, blood components, source 
plasma, source leukocytes, or their components, accessories, or parts 
are intended to help prevent any recurrence of situations in which 
blood products not approved for use in the United States are used in 
products that are then distributed into U.S. commerce. In one such 
case, a manufacturer imported unlicensed source plasma for use in the 
manufacture of hepatitis test kits, and these kits were later 
distributed in the United States. Consistent with section 801(d)(4) of 
the act, the agency is proposing rules to ensure that blood products 
that are not licensed or approved for use in the United States are not 
used in products distributed in the United States.

B. Reporting Requirements

    As stated earlier, section 801(d)(3)(A) of the act requires the 
importer to submit, ``at the time of initial importation,'' a statement 
to the agency indicating that the imported article is intended to be 
further processed or incorporated by the initial owner or consignee 
into a drug, biological product, device, food, food additive, color 
additive, or dietary supplement that will be exported by such owner or 
consignee from the United States in compliance with section 801(e) or 
802 of the act or section 351(h) of the PHS Act.
    Accordingly, proposed Sec. 1.84(b)(1) would require an importer to 
submit a statement to FDA each time the importer imports an article 
under the import-for-export provisions of the act. The statement would 
be required each time the product enters the United States, even if the 
imported article has been previously imported. The statement, under 
proposed Sec. 1.84(b)(2), would include, but not be limited to, the 
following:
    1. A formal declaration of the purpose for which the article is 
being imported prior to export (how it will be further processed, or 
the name or description of the product into which it will be 
incorporated in the United States), and that it will not be sold or 
offered for sale in the United States;
    2. The name or description of the article (including any scientific 
or technical name);
    3. Any product coding, batch, lot, or other identifying numbers;
    4. The name and address of the foreign manufacturer of the imported 
article; and
    5. The name and address of the initial owner or consignee in the 
United States responsible for the further processing or incorporation 
of the article into another product.
    For blood products, proposed Sec. 1.84(b)(2) would also require the 
importer to include a copy of the determination from FDA granting 
permission to import the product.
    The statements would be sent to the FDA district having 
jurisdiction over the port of entry at which the article will be 
offered for import. Proposed Sec. 1.84(b)(3) would require the importer 
to retain a copy of the statement as part of its records for the 
imported article.

C. Shipping Package Label Requirements

    To facilitate identification of articles imported into the United 
States under the import-for-export provisions in section 801(d)(3) and 
(d)(4) of the act, FDA is proposing certain label requirements for 
shipping containers. Under proposed Sec. 1.84(c), the importer, initial 
owner, or consignee would be responsible for permanently affixing to 
the shipping container, package or crate a label, in English, 
indicating that the shipping container, package, or crate contains 
article(s) that are intended for export from the United States after 
further processing or incorporation into another product, and may not 
be sold or offered for sale in the United States. The label would also 
name or describe the imported article(s); provide any product coding, 
batch, lot, or other identifying numbers; provide the foreign 
manufacturer's name and address; identify the imported article's 
country of origin (if different from that of manufacturer); and contain 
any appropriate warning or special handling label. For example, if an 
imported blood product tested positive for an infectious agent, 
proposed Sec. 1.84(c)(6) would require the shipping package label to 
indicate the agent for which the product tested positive and 
prominently display the term ``BIOHAZARD.''

D. Label Requirements for Imported Blood Products

    Proposed Sec. 1.84(d) would require a foreign supplier of blood, 
blood components, source plasma, source leukocytes, or a component, 
accessory, or part thereof (including blood or plasma derivatives or 
intermediates) that is not licensed under section 351(a) of the PHS Act 
and is to be imported under section 801(d)(4) of the act, to label the 
products, in English, with the following information:
    1. A properly descriptive name;
    2. Name(s) and address(es) of establishments collecting, preparing, 
labeling, or pooling the source material;
    3. Donor, lot, or pool numbers relating the unit to the donor;
    4. The recommended storage temperature (in degrees Celsius);
    5. The quantity of the product;
    6. The statement, ``Import for Export;''
    7. The statement, ``Not for Use in Products Subject to Licensure 
Under Section 351 of the Public Health Service Act;''
    8. The statement, ``For Manufacturing Use Only'' or ``For 
Manufacturing into Noninjectable Products Only;''
    9. A statement indicating that the product has been tested for 
infectious disease agents, including, but not limited to, HIV-1, HIV-2, 
hepatitis B virus, hepatitis C virus, HTLV-I, HTLV-II, and Treponema 
pallidum. The infectious agent tests may be performed using test kits 
other than those licensed or approved by FDA and should be the same 
tests described in the request for determination under proposed 
Sec. 1.84(a).
    10. If the product tested positive for any infectious agent listed 
in proposed Sec. 1.84(d)(9), the product's label would indicate the 
agent(s) for which the product tested positive and display the term 
``BIOHAZARD'' prominently and in bold letters; and
    11. Any other appropriate warnings or special handling instructions 
as determined by the importer.
    A copy of the label, under proposed Sec. 1.84(a), would be included 
in the initial request for determination that the blood product meets 
the ``appropriate circumstances and conditions'' for importation under 
section 801(d)(4) of the act.
    The requirements in proposed Sec. 1.84(d) would be in addition to 
the shipping package label requirements in proposed Sec. 1.84(c).
    FDA also notes that regulations issued by other Federal agencies 
and departments may apply to the imported products (see, e.g., 9 CFR 
parts 92 et al.; 19 CFR part 12; 42 CFR part 72; 49 CFR part 173, U.S. 
Postal Service regulations, 39 CFR parts 124 and 125).

E. Recordkeeping Requirements

    Section 801(d)(3)(B) of the act requires that ``the initial owner 
or consignee responsible for such imported article maintain records 
that identify the use of such imported article.'' Proposed Sec. 1.84(e) 
would require the initial owner or consignee responsible for the 
article imported into the United States under the import-for-export 
provision to have

[[Page 64933]]

a place of business in the United States, to maintain identifying 
records for 5 years after the date on which the imported article was 
exported (after further processing or incorporation into another 
product) or destroyed, and to make the identifying records available 
for inspection by the agency. The identifying records would include the 
following information:
    1. The name or description of the article (including any scientific 
or technical name);
    2. Any product coding, batch, lot, or other identifying numbers;
    3. The name and address of the foreign manufacturer of the imported 
article;
    4. How the article will be or was further processed, and the name 
or description of any product into which it will be or was incorporated 
in the United States;
    5. The signature of the responsible individual at the importing 
firm;
    6. The name and address of the firm in the United States where the 
article will be further processed or incorporated into another product;
    7. The disposition of the imported article, including quantity and 
methods of disposition (i.e., manufacturing records showing how 
specific articles were used or destroyed and the dates of receipt, use, 
destruction, or re-exportation, as that information becomes available);
    8. Any product coding, lot, batch, or other identification number 
for the further-processed article or product incorporating the imported 
article;
    9. A copy of the label to be applied to the shipping package, 
container, or crate used to export the further-processed article or 
product incorporating the imported article (indicating that it contains 
articles that may not to be sold or offered for sale in the United 
States and are intended for export only);
    10. The name and address of the foreign purchaser of the further-
processed article or product incorporating the imported article; and
    11. For blood, blood components, source plasma, source leukocytes, 
or a component, accessory, or part thereof (including blood or plasma 
derivatives or intermediates) that is not licensed under section 351(a) 
of the PHS Act and is to be imported under section 801(d)(4) of the 
act, documentation of the agreement between the foreign material 
supplier and the U.S. manufacturer. Proposed Sec. 1.84(e)(2)(xi) would 
require this documentation to outline the specific contractual 
relationship, the foreign manufacturing specifications, and the U.S. 
manufacturer's plan for auditing the foreign supplier to ensure 
compliance with the terms of the contract.
    Additionally, proposed Sec. 1.84(e)(2)(xi) would require the 
initial owner or consignee of imported blood, blood components, source 
plasma, source leukocytes, or a component, accessory, or part thereof 
(including blood or plasma derivatives or intermediates) to have 
written standard operating procedures to ensure that such products or 
articles incorporating such products are not diverted to domestic use 
in the United States and are kept segregated from and are not comingled 
with products or components intended for use in the United States. 
These procedures could, for example, include quarantine procedures for 
segregating imported blood, blood components, or final products from 
products intended for use in the United States and validation data for 
procedures used to clean equipment and manufacturing facilities that 
produce both products for distribution in the United States and 
products for export only.
    FDA emphasizes that companies must also comply with the applicable 
requirements of section 801(e) or 802 of the act or section 351(h) of 
the PHS Act. (Persons who seek to import tissues or their parts or 
components must also comply with section 361 of the PHS Act.) Those 
statutory provisions may impose additional requirements on the exported 
product as well as requirements on notification to FDA, labeling, and 
records.

F. Registration and Listing Requirements for Persons Who Import and 
Further Process or Incorporate Blood Products That Are Not Licensed 
Under With Section 351(a) of the PHS Act

    As an additional condition for importing blood products that are 
not licensed under section 351(a) of the PHS Act, proposed Sec. 1.84(f) 
would require that the person in the United States who will be further 
processing or incorporating the imported article register with the FDA 
and list the blood product(s) that it will be processing or 
incorporating into other products or update its registration and 
listing. The listing would include a description of the imported 
article as well as the final product for export. The proposal would 
require that the registration and listing information be sent to the 
appropriate registration office listed in 21 CFR part 207 or part 607. 
This registration and listing will enable FDA to track all blood 
products imported under section 801(d)(4) of the act that are not 
licensed under section 351(a) of the PHS Act and to monitor the 
products so that they do not enter domestic commerce. Additionally, for 
blood products to be exported after further manufacture into final 
dosage form under section 351(h) of the PHS Act, such registration and 
listing will enable FDA to evaluate, if appropriate, the person who 
will be further processing or incorporating the imported article to 
ensure that compliance with current good manufacturing practices, or, 
consistent with section 802(f)(1) of the act, conformance with 
international manufacturing standards as certified by an international 
standards organization recognized by FDA, as specified by section 
351(h)(3) of the PHS Act. Section 802(f)(1) of the act requires all 
products exported under section 802 of the act to be in substantial 
conformity with current good manufacturing practices or to meet 
international standards as certified by an international standards 
organization recognized by FDA. At this time, FDA has not formally 
recognized any international standards or international standards 
organizations for purposes of section 802(f)(1) of the act.

III. Environmental Impact

    The agency has determined under 21 CFR 25.30(h) and (j) 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.

IV. Analysis of Impacts

    FDA has examined the impacts of the proposed rule under Executive 
Order 12866 and the Regulatory Flexibility Act (5 U.S.C. 601-612). 
Executive Order 12866 directs agencies to assess all costs and benefits 
of available regulatory alternatives and, when regulation is necessary, 
to select regulatory approaches that maximize net benefits (including 
potential economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity).
    According to Executive Order 12866, a regulatory action is 
economically significant if it meets any one of a number of specified 
conditions, including having an annual effect on the economy of $100 
million or adversely affecting in a material way a sector of the 
economy, competition, or jobs. A regulation is considered significant 
under Executive Order 12866 if it raises novel legal or policy issues.
    The agency believes that this proposed rule is consistent with the 
regulatory philosophy and principles identified in the Executive Order. 
In

[[Page 64934]]

addition the proposed rule is not a significant regulatory action as 
defined by the Executive Order. The agency also believes that the 
recordkeeping and reporting requirements encompassed in the proposed 
rule will not have a significant effect on the economy. FDA estimates 
the industry's total recordkeeping and reporting costs to be $40,000 
and $61,500, respectively. These estimates are based on an estimated 
cost of $100 per record and an average wage or $30 per hour for each 
report (with a total of 2,050 reports). Thus, the proposed rule's cost 
to industry would be $101,500.
    The Regulatory Flexibility Act requires the agency to analyze 
options that would minimize any significant impact of a rule on small 
businesses. This proposed rule would entail only minimal reporting and 
recordkeeping as necessary to identify substances and their use that 
have been imported under the ``import for export'' provisions of the 
act. The required reporting and recordkeeping is necessary to enable 
the importer to ensure, and the agency to monitor, that such imported 
substances are further processed or incorporated into another product 
while in the United States, and are then exported or destroyed, as 
required by the act. Indeed, the ``import-for-export'' provisions of 
the act that these proposed regulations would implement might create 
new economic opportunities for U.S. businesses, including small 
businesses. Thus, the agency certifies that the proposed rule will not 
have a significant economic impact on a substantial number of small 
businesses. Therefore, under the Regulatory Flexibility Act, the agency 
is not required to conduct further analysis.

V. Paperwork Reduction Act of 1995

    This proposed rule contains information collection requirements 
that are subject to public comment and review by the Office of 
Management and Budget (OMB) under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501-3520). The title, description, and respondent 
description for the information collection requirements are shown below 
with an estimate of the annual reporting and recordkeeping 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 collection of 
information is 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 collection 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 
collection of information on respondents, including through the use of 
automated collection techniques, when appropriate, and other forms of 
information technology.
    Title: Import for Export; FDA Export Reform and Enhancement Act of 
1996; Reporting and Recordkeeping Requirements for Unapproved or 
Violative Products Imported for Further Processing or Incorporation and 
Subsequent Export.
    Description: The proposed rule would require an importer to report 
to FDA each time that it is importing an article that is to be exported 
after further processing or incorporation into another product in the 
United States, and to keep records enabling him to ensure, and FDA to 
monitor, that the article is so processed or incorporated and then 
exported, and that any portion of the import that is not exported is 
destroyed. This proposed rule is to implement section 801(d)(3) and 
(d)(4) of the act as amended by the FDA Export Reform and Enhancement 
Act of 1996.
    Description of Respondents: Persons and businesses, including small 
businesses.
    The estimated burden associated with the information collection 
requirements for this proposed rule is 10,050 hours.
    FDA estimates the burden of this collection of information as 
follows:

                                Table 1.-- Estimated Annual Recordkeeping Burden1
----------------------------------------------------------------------------------------------------------------
                                                      Annual
         21 CFR Section               No. of       Frequency per   Total Annual      Hours per      Total Hours
                                   Recordkeepers   Recordkeeping      Records      Recordkeeper
----------------------------------------------------------------------------------------------------------------
1.84(e)                                75               5             375              20           7,500
1.84(e)(xi)                            25               1              25              20             500
                                                                                                    8,000
----------------------------------------------------------------------------------------------------------------
\1\There are no operating and maintenance costs or capital costs associated with this collection of information.


                                  Table 2.-- Estimated Annual Reporting Burden1
----------------------------------------------------------------------------------------------------------------
                                                      No. of
         21 CFR Section               No. Of       Responses per   Total Annual      Hours per      Total Hours
                                    Respondents     Respondent       Responses       Response
----------------------------------------------------------------------------------------------------------------
1.84(a)                                25               1              25              46           1,150
1.84(b)                                75               5             375               1             375
1.84(c)                                75               5             375               1             375
1.84(d)                                25               1              25               5             125
1.84(f)                                25               1              25               1              25
                                                                                                    2,050
----------------------------------------------------------------------------------------------------------------
\1\There are no operating and maintenance costs or capital costs associated with this collection of information.

     The above estimates were based on normal operating burdens for the 
preparation and submission of information to FDA for imported products, 
the actual number of firms and import for export entries in fiscal year 
(FY) 1997, and projections of the future number of firms and import for 
export entries. In FY 1997, 41 firms, on 175 different occasions, 
brought products into the United States under the import for export 
authority at an average rate of 4.27 entries per firm (although most 
firms only used the import for export authority once in FY

[[Page 64935]]

1997). The agency anticipates more firms (particularly firms involved 
with blood and blood products) to use the import for export authority 
in the future and, therefore, estimates the maximum number of 
respondents or recordkeepers to be 75 (an increase of 29 over FY 1997).
    FDA's estimates for the hours per record or report are based on 
estimates from persons familiar with export operations. The records or 
reports would, in many situations, be derived from normal business 
records for imported products, so the burden should be very minimal and 
should also be consistent with current recordkeeping practices.
    The agency has submitted the information collection requirements of 
this proposed rule to OMB for review. Interested persons are requested 
to send comments regarding information collection by December 24, 1998, 
to OMB (address above).

VI. Request for Comments

    Interested persons may on or before February 8, 1999, submit to the 
Dockets Management Branch (address above) written comments regarding 
this notice. Two copies of any comments are to be submitted, except 
that individuals may submit one copy. Comments are to be identified 
with the docket number found in brackets in the heading of this 
document. Received comments will be on file with the Dockets Management 
Branch (address above) and may be seen in that office between 9:00 a.m. 
and 4:00 p.m., Monday through Friday.

List of Subjects in 21 CFR Part 1

    Cosmetics, Drugs, Exports, Food labeling, Imports, Labeling, 
Reporting and recordkeeping requirements.
    Therefore, under the Federal Food, Drug, and Cosmetic Act, the 
Public Health Service Act, and authority delegated to the Commissioner 
of Food and Drugs, it is proposed that 21 CFR part 1 be amended as 
follows:

PART 1--GENERAL ENFORCEMENT REGULATIONS

    1. The authority citation for 21 CFR part 1 is revised to read as 
follows:

    Authority: 15 U.S.C. 1453, 1454, 1455; 21 U.S.C. 321, 343, 352, 
355, 360b, 362, 371, 374, 381, 382, 393; 42 U.S.C. 216, 262, 264.

    2. Section 1.84 is added to subpart E to read as follows:


Sec.  1.84  Import for export: Request for determination and reporting 
and recordkeeping requirements for unapproved or violative products 
imported for further processing or incorporation into specified 
products and subsequent export.

    (a) Request for determination regarding the importation of blood, 
blood components, source plasma, source leukocytes, or their 
components, accessories, or parts. (1) A person who intends to import 
blood, blood components, source plasma, source leukocytes, or their 
components, accessories, or parts (including blood or plasma 
derivatives or intermediates) that are not licensed under section 
351(a) of the Public Health Service Act (the PHS Act) shall, before 
importing the product into the United States under section 801(d)(4) of 
the Federal Food, Drug, and Cosmetic act (the act), request a 
determination that such importation is permitted.
    (2) The request shall contain the following information:
    (i) The names and addresses of the foreign manufacturer of the 
article to be imported and the initial owner or consignee in the United 
States that would be responsible for the further processing or 
incorporation of the article into another product;
    (ii) The specific identity of the article to be imported and 
details as to how the imported article will be further processed or 
incorporated into a product for export;
    (iii) A description of the standard operating procedures and 
safeguards that the initial owner or consignee in the United States 
will use or implement to ensure that the imported articles or products 
incorporating such articles are segregated from and not comingled with 
products, components, accessories, or parts intended for use in the 
United States (e.g., quarantine procedures used for segregating 
imported blood, blood components, or final products from products 
intended for use in the United States, including validation data for 
procedures to clean equipment and facilities used in manufacturing 
products for use in the United States and products for export);
    (iv) General donor screening questionnaire or criteria, translated 
into English, that will be used to screen donors;
    (v) A certification that tests for infectious disease will be 
performed by the foreign supplier on the blood, blood components, 
source plasma, or source leukocytes, or their components, accessories, 
or parts (including blood or plasma derivatives or intermediates) at 
the time of donation and before importation to the United States, and 
the expected results of such tests. The infectious disease agents that 
shall be tested for include, but are not limited to: HIV-1, HIV-2, 
hepatitis B virus, hepatitis C virus, HTLV-I, HTLV-II, and Treponema 
palladum. A request under paragraph (a) of this section may be based 
upon infectious agent tests performed using test kits other than those 
licensed or approved by the Food and Drug Administration (FDA). In such 
cases, a copy of the labeling for the test kit used, translated into 
English, shall be included in the submission; and
    (vi) A copy of the label described in paragraph (d) of this 
section.
    (3) The request for determination shall be submitted to Office of 
Compliance, Division of Case Management (HFM-610), Center for Biologics 
Evaluation and Research, Food and Drug Administration, 1401 Rockville 
Pike, suite 200N, Rockville, MD 20852-1448.
    (4) Records pertaining to the request for determination shall be 
maintained and made available for FDA review upon request.
    (5) If FDA determines that the blood, blood component, source 
plasma, or source leukocyte, or component, accessory, or part meets the 
appropriate circumstances and conditions to permit its importation into 
the United States, FDA shall, in writing, notify the person requesting 
the determination that it has granted permission to import the article.
    (b) Reporting requirements. (1) A person wishing to import articles 
specified in paragraphs (b)(l)(i) through (b)(l)(iv) of this section 
that may not be sold or offered for sale in the United States, but 
which the initial owner or consignee intends to have further processed 
or incorporated into a drug, biological product, device, food, food 
additive, color additive, or dietary supplement in the United States, 
and which the initial owner or consignee will export from the United 
States in accordance with sections 801(e) or 802 of the act or section 
351(h) of the PHS Act, shall submit to the FDA district with 
jurisdiction over the port of entry, with each import entry, a 
statement containing information described in paragraph (b)(2) of this 
section. The articles for which this reporting requirement apply are:
    (i) A component of a drug (including a drug, veterinary drug, and 
biological for use in humans);
    (ii) A component part or accessory of a device, or other article of 
device requiring further processing, which is ready or suitable for use 
for health-related purposes;
    (iii) A food or color additive; and
    (iv) A dietary supplement.

[[Page 64936]]

     (2) The statement that shall be supplied to FDA with each import 
entry shall include, but is not limited to, the following information:
    (i) A formal declaration of the purpose for which the article is 
being imported before export (how it will be further processed, or the 
name or description of the product into which it will be incorporated 
in the United States) and that it will not be sold or offered for sale 
in the United States;
    (ii) The name or description of the article (including any 
scientific or technical name);
    (iii) Any product coding, batch, lot, or other identifying numbers;
    (iv) The name and address of the foreign manufacturer of the 
imported article (if different from the name of the foreign shipper 
identified in the import records at the U.S. Customs Service);
    (v) The name and address of the initial owner or consignee in the 
United States and, if different, the address in the United States where 
the article will be further processed or incorporated into any product 
listed in paragraph (b)(1) of this section; and
    (vi) In addition to the information described in paragraphs 
(b)(l)(i) through (b)(l)(iv) of this section, for blood, blood 
components, source plasma, source leukocytes, or a component, 
accessory, or part thereof (including blood or plasma derivatives or 
intermediates) that are not licensed under section 351(a) of the PHS 
Act and are to be imported under section 801(d)(4) of the act, the 
statement shall include a copy of the determination by the agency 
granting permission to import the product.
    (3) The initial owner or consignee also shall keep a copy of the 
statement as part of its records for the article.
    (c)  Shipping-package label requirements. The importer, initial 
owner, or consignee of articles to be imported into the United States 
for further processing or incorporation into a product for export shall 
permanently affix, to the articles' shipping container, package or 
crate, a label that provides the following information in English:
    (1) Contains article(s) that are intended for export from the 
United States after further processing or incorporation into articles 
intended for export, and may not be sold or offered for sale in the 
United States;
    (2) The name or description of the article(s) (including any 
scientific or technical name);
    (3) The product coding, batch, lot, or other identifying numbers;
    (4) The name and address of the responsible foreign manufacturer of 
the imported article(s);
    (5) The country of origin (if different from that of responsible 
manufacturer); and
    (6) Any appropriate warning or special-handling label, such as 
``BIOHAZARD'' for products potentially contaminated with an infectious 
agent.
    (d)  Label requirements for blood products. The foreign supplier of 
blood, blood component, source plasma, source leukocyte, or a 
component, accessory, or part thereof (including blood or plasma 
derivatives or intermediates) that is not licensed under section 351(a) 
of the PHS Act and is to be imported under section 801(d)(4) of the 
act, shall label the product in English with the following information:
    (1) A properly descriptive name;
    (2) Name(s) and address(es) of establishments collecting, 
preparing, labeling, or pooling the source material;
    (3) Donor, lot, or pool numbers relating the unit to the donor;
    (4) The recommended storage temperature (in degrees Celsius);
    (5) The quantity of the product;
    (6) The statement, ``Import for Export;''
    (7) The statement, ``Not for Use in Products Subject to Licensure 
Under Section 351 of the Public Health Service Act;''
    (8) The statement, ``For Manufacturing Use Only'' or ``For 
Manufacturing into Noninjectable Products Only;''
    (9) A statement indicating that the product has been tested for 
infectious disease agents, including, but not limited to: HIV-1, HIV-2, 
hepatitis B virus, hepatitis C virus, HTLV-I, HTLV-II, and Treponema 
palladum. A request under paragraph (a) of this section may be based 
upon infectious agent tests performed using test kits other than those 
licensed or approved by FDA. In such cases, a copy of the label for the 
test kit used, translated into English, shall accompany the request;
    (10) If the product has tested positive for any infectious agent as 
required in paragraph (d)(9) of this section, the product's label shall 
indicate the agent(s) for which the product has tested positive, and 
the term ``BIOHAZARD'' shall be prominently displayed in bold letters; 
and
    (11) Any other appropriate warnings or special handling 
instructions as determined by the importer.
    (e)  Recordkeeping requirements. (1) The initial owner or consignee 
who is responsible for the article offered for import shall have a 
place of business in the United States.
    (2) The initial owner or consignee responsible for the article 
offered for import shall maintain identifying records for 5 years after 
exportation or destruction of the imported article, and shall make 
those identifying records available for inspection by the agency. The 
identifying records shall include the following information:
    (i) The name or description of the article (including any 
scientific or technical name);
    (ii) Any product coding, batch, lot, or other identifying numbers;
    (iii) The name and address of the foreign manufacturer of the 
imported article;
    (iv) How the article will be or was further processed, and the name 
or description of any product into which it will be or was incorporated 
in the United States;
    (v) The signature of the responsible individual at the importing 
firm;
    (vi) The name and address of the firm in the United States where 
the article will be or was further processed or incorporated into 
another product;
    (vii) The disposition of the imported article (i.e., manufacturing 
records showing how specific articles were used or destroyed and the 
dates of receipt, use, destruction, or re-exportation, as that 
information becomes available);
    (viii) Any product coding, lot, batch, or other identification 
number for the further-processed article or product incorporating the 
imported article;
    (ix) A copy of the label to be applied to the shipping package, 
container, or crate used to export the further-processed article or 
product incorporating the imported article (indicating that it contains 
articles that may not be sold or offered for sale in the United States 
and are intended for export only);
    (x) The name and address of the foreign purchaser of the further-
processed article or product incorporating the imported article; and
    (xi) Additionally, for blood, blood components, source plasma, 
source leukocytes, or a component, accessory, or part thereof 
(including blood or plasma derivatives or intermediates) that is not 
licensed under section 351(a) of the PHS Act and is to be imported 
under section 801(d)(4) of the act, the records shall include 
documentation of the agreement between the foreign material supplier 
and the U.S. manufacturer. The documentation shall outline the specific 
contractual relationship, the foreign manufacturing specifications, and 
the U.S. manufacturer's plan for auditing the foreign supplier to 
ensure compliance with the terms of the contract. The initial owner or 
consignee shall have written standard operating procedures to ensure 
that such products are not

[[Page 64937]]

diverted to domestic use in the United States and are kept segregated 
from and not comingled with products or components intended for use in 
the United States (e.g., quarantine procedures used for segregating 
imported blood, blood components, or final products from products 
intended for use in the United States, including validation data for 
procedures to clean equipment and facilities used for manufacturing 
products for use in the United States and exported products).
    (f)  Registration and listing requirements. Each person who intends 
to further process or incorporate blood, blood components, source 
plasma, source leukocytes, or a component, accessory, or part thereof 
(including blood or plasma derivatives or intermediates) that is not 
licensed under section 351(a) of the PHS Act and is to be imported 
under section 801(d)(4) of the act, shall register with FDA and list 
the blood product to be further processed or incorporated into other 
products, or update its registration and listing, and include in the 
listing a description of the imported material as well as the final 
product for export. The information shall be sent to the appropriate 
registration office listed in parts 207 or 607 of this chapter.

    Dated: November 14, 1998.
William K. Hubbard,
Associate Commissioner for Policy Coordination.
[FR Doc. 98-31351 Filed 11-23-98; 8:45 am]
BILLING CODE 4160-01-F