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Executive Summary

The Bush Administration has until Aug. 6 to submit its position on each provision of the FDA enforcement bill to Rep. Waxman's House Energy & Commerce/Health Subcommittee, Waxman (D- Calif.) told FDA Commissioner Kessler at a July 17 hearing. Waxman told Kessler he would keep the hearing record open for 20 days in response to the FDA Commissioner's brief, one-page statement on the bill (HR 2597). Kessler said that the Administration is "carefully considering these issues" and that "one of" the Administration's "concerns is that HR 2597 is too broad and may be reaching further than is needed." The FDA commissioner did not oppose any particular provisions, stating only that the Administration's "discussions are ongoing, and we consider this subject to be a high priority." Subcommittee Chairman Waxman commented that he was "surprised" by the brevity of Kessler's statement and by the Administration's difficulty in coming up with a formal position on HR 2597. Waxman noted that the subcommittee had postponed the hearing, initially scheduled for June 27, to give the Administration additional time to formulate its position on the bill. Kessler reportedly was prepared to endorse the legislation in late June. However, an outcry of opposition by a large cross- section of FDA-regulated industries ("The Pink Sheet" July 1, p. 8) reached the ears of political operatives within HHS and the Office of Management & Budget who apparently persuaded Kessler to seek a postponement of the hearing. In preparation for the July 17 hearing, Kessler is said to have drafted modified testimony that again supported most of HR 2597's provisions but questioned the need for other parts of the bill. Within days before the hearing, the commissioner reportedly was told by higher-ranking officials in the White House and Vice President Quayle's Competitiveness Council that such support would not reflect the Administration's view of the bill. Reportedly, the higher-ups in the Administration were moved by appeals from the Pharmaceutical Manufacturers Association. Kessler's draft testimony is understood to have identified several provisions in HR 2597 as high legislative priorities, including administrative recall authority, power to impose civil penalties, authority to embargo violative products and the right to inspect the records of food establishments with the same authorities the agency possesses to inspect drug facilities. The draft testimony reportedly did not oppose outright the bill's remaining provisions but simply did not list them as priorities for the agency. The low-priority provisions reportedly involved imports, subpoena power and reduction of FDA's burden in court of showing that violative products affect interstate commerce. Both the commissioner and HHS Secretary Sullivan have testified in earlier hearings that they would endorse legislation to provide FDA with additional enforcement powers. The Bush Administration's reservations about the bill became public after the Pharmaceutical Manufacturers Association, the Health Industry Manufacturers Association and 21 other trade groups wrote to Congress on June 21 to express their opposition to HR 2597. The bill largely reflects proposed legislation that was drafted in March by FDA and was believed to represent the commissioner's enforcement wish list ("The Pink Sheet" March 25, p. 3). Kessler served on the HHS (Edwards) Advisory Committee on FDA, which endorsed the agency draft proposal and urged Congress to enact tough enforcement legislation. In addition, Sullivan told a Waxman subcommittee hearing on the Edwards Committee report in June that HHS, which had proposed broad enforcement legislation in 1989 in response to the generic drugs scandal, already had cleared the FDA draft proposal for review by the Office of Management & Budget ("The Pink Sheet" June 17, p.3). At the July 17 hearing, Waxman asked Kessler whether his personal views conflicted with his formal statement on behalf of the Administration. The commissioner replied that it "would be much more useful" for the Administration to "speak with one voice" so that the Administration and Congress can "pull our thoughts together, work with all people" and build a consensus on the legislation. Waxman also addressed a line of questions to the four agency "enforcement professionals" who accompanied Kessler to the hearing to determine whether they would find the bill's provisions useful. The FDAers unanimously indicated that they could accomplish their missions more efficiently and effectively if the agency had authority to order product recalls, to embargo violative products and to subpoena testimony and company records. The FDA witnesses were Regulatory Affairs Enforcement Director Alan Hoeting, Northeast Regional Office Director Arthur Beebe, Midwest Regional Office Director Burton Love and Detroit District Office Investigations Branch Director Ken Shelin. After the enforcement officials endorsed the third of HR 2597's provisions, Kessler interrupted Waxman and again asked the chairman to postpone his inquiry into the FDAers' personal opinions about the bill until the Administration could "speak with one voice." FDA is "a large organization, and we want to work with you; we want to be helpful and provide Congress the information necessary" to produce legislation "the right way," Kessler said. Waxman responded that during the "discussions yet to take place with the Administration," he hoped "that the views of the enforcement people will be made available not just to you but to others in the Administration." The congressman then agreed to end his line of questions. The commissioner replied: "I appreciate that, Mr. Chairman." During Q-&-A, Kessler asserted that any legislation to grant FDA additional enforcement powers should protect due process protections for regulated industries. He further said FDA does "not need any additional authority with regard to seizure." But Kessler also agreed with Rep. Dingell (D-Mich.) that FDA ought to be authorized to stop behavior in which companies currently can continue marketing potentially dangerous products while, for tort reasons, they negotiate with FDA over whether a recall should be identified as Class I, Class II or Class III. In addition, the commissioner commented that authority to assess civil money penalties might be "a valuable tool" that would give FDA an alternative punitive measure to use against violations for which criminal punishment might be "draconian." In his opening statement, Waxman summarized the consensus of support among government officials involved with FDA for a bill like HR 2597 that would expand the agency's enforcement powers. "Secretary Sullivan's [Edwards] Advisory Committee recommended that Congress arm the FDA with these enforcement tools for all the products that it regulates," the California Democrat noted. Advisory committee Chairman Charles Edwards "reaffirmed that position in testimony before the subcommittee." A Congressional Research Service report on the bill's provisions, which was entered into the subcommittee record, concludes that many provisions of HR 2597 "are apparently comparable to those granted to other administrative agencies." For example, the Federal Trade Commission and the Consumer Product Safety Commission, the Occupational Safety and Health Administration and the Federal Grain Inspection Service have subpoena power, CRS said. The report also states that the Environmental Protection Agency is authorized to assess civil money penalties. HHS is currently empowered to order recalls of violative biological products if they present "an imminent or substantial health hazard," CRS said, and CPSC and the National Highway Traffic Safety Administration "have been empowered with recall authority over products with which the agencies have regulatory responsibility."

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