FDA Small Business Administration submits comment on FDA proposed rule

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AgentAnia

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The Small Business Administration Office of Advocacy has submitted a comment to FDA on the deeming regs: Office of Advocacy - Regulatory Comment Letters - 6/11/14- Deeming Tobacco Products To Be Subject to the Federal Food, Drug, and Cosmetic Act, as Amended by the Family Smoking Prevention and Tobacco Control Act | SBA.gov (Emphasis added)

Based on input from small business stakeholders, Advocacy is concerned that the Initial Regulatory Flexibility Analysis (IRFA) contained in the proposed rule lacks essential information required under the Regulatory Flexibility Act (RFA)[3]. Specifically, the IRFA does not discuss the quantitative or qualitative costs of the proposed rule on many potentially affected small entities. Moreover, given the extent of the anticipated costs of this proposal, the IRFA does not adequately consider or explain significant alternatives which accomplish the stated FDA objectives while minimizing the significant economic impact of the proposal on small entities. For this reason, Advocacy recommends that the FDA republish for public comment a Supplemental IRFA before proceeding with this rulemaking.
A fairly long read, but worth your time, I think.
 

Kent C

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The Small Business Administration Office of Advocacy has submitted a comment to FDA on the deeming regs: Office of Advocacy - Regulatory Comment Letters - 6/11/14- Deeming Tobacco Products To Be Subject to the Federal Food, Drug, and Cosmetic Act, as Amended by the Family Smoking Prevention and Tobacco Control Act | SBA.gov (Emphasis added)


A fairly long read, but worth your time, I think.

Wow. Thanks for posting. Skimmed it but will read fully later. This is where it's at, imo, if there's no change in grandfather date. And just from the blurb above, unless the FDA has some other doc regarding this, they really didn't explain the deeming or impact doc what they actually did to comply with RFA OR Exec. Order 12866 which focuses on the effect to small business. It's an area that could very well end in lawsuits with a combined effort on the part of vendors, and perhaps other parties such as Institute for Justice on 5th amendment - 'takings' - ground.
 
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Kent C

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Kent C, I agree. Among many other weaknesses of the proposed rule, I see this as a major problem with it. And the fact that this comes from another federal agency may carry more weight -- sad but true -- w/ the FDA and have a greater impact. We shall see.

AA,
I'm currently working on listing the 'request for comments' in the deeming and the impact docs. Don't know how useful it may be but I'll post it or make it available to anyone. What should strike anyone when reading the impact doc is 'why do they lay out and make tables for all the 'alternatives' listed?'. Many of them actually are more friendly to small businesses. Why go through all of that trouble only to post the deeming doc a few weeks later? As I've mentioned before, I think it was the Senator's letter that set a fire under Zeller, where the deeming doc renders all of the impact doc moot.

If not the Senator's letter, then it is likely that they had to, by law, list all of those alternatives, which basically disregards the intent of the laws that may require that, (including RFA and the Exec Order), where doing so is just 'paper work' rather than actually considering those alternatives. Perhaps it's a combination of both the letter and the 'red tape'. At any rate, they still 'request comments' on the alternatives and we, imo, should take them at their word on that :)
 

Kent C

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Reading through.... here's an excellent point, imo. Here's the part in the deeming doc that addresses the RFA (and exec orders): pg185


XII. Analysis of Impacts: Summary
FDA has examined the impacts of the proposed 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 (Public Law 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). The agency believes that this proposed rule would be an economically significant
regulatory action as defined by Executive Order 12866.

The Regulatory Flexibility Act requires agencies to analyze regulatory options that would
minimize any significant impact of a rule on small entities.
FDA has determined that this
proposed rule would have a significant economic impact on a substantial number of small
entities.


And from Advocacy:

Under the RFA, an IRFA must contain: (1) a description of the reasons why the regulatory action is being taken; (2) the objectives and legal basis for the proposed regulation; (3) a description and estimated number of regulated small entities; (4) a description and estimate of compliance requirements, including any differential for different categories of small entities; (5) identification of duplication, overlap, and conflict with other rules and regulations; and (6) a description of significant alternatives to the rule.[10] Advocacy is concerned that because the proposed rule’s IRFA is deficient, the public has not been adequately informed about the possible impact of the proposal on small entities and whether there are less burdensome significant alternatives to the proposed rule that would meet the FDA’s objectives.

-----
There is no such assessment in the deeming doc - not ever close. They offer the impact doc...

http://www.fda.gov/downloads/AboutFDA/ReportsManualsForms/Reports/EconomicAnalyses/UCM394933.pdf

... as their justification but all alternatives in the impact doc are rendered moot by the deeming doc. Yeah, they did some assessments, but they mean nothing and they don't even justify that in the deeming doc. There's one comment and only on Exec Order 12866 that comes close:

"The agency believes that this proposed rule would be an economically significant
regulatory action as defined by Executive Order 12866."

... whatever that means - 'economically significant'?? Yeah - it would economically devastate many small businesses.

If I were a vendor, I'd look closely at joining/contacting Advocacy.
 
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Kent C

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And this puts the 'political and business' influence right in their face - the 'unsure why' statement* :) :

"Notably, the proposed rule considers some of these alternatives for one specific product category: premium cigars. In the proposal, the FDA provides detailed data showing why the agency is considering this alternative and the cost savings that exempting premium cigars would yield. While Advocacy appreciates this example of an alternative that could meet regulatory goals while significantly reducing regulatory burdens, the FDA however does not provide an analysis related to this alternative in the IRFA for premium cigars or any other product. Advocacy is unsure of why the FDA would not consider this significant alternative in the proposal’s IRFA. Further, Advocacy is concerned that the FDA did not discuss and consider other alternatives in the IRFA that would yield similar significant cost savings as exempting premium cigars would, and that the agency did not perform a similar level of analysis on the alternatives listed in the IRFA as the agency did do elsewhere in the rule related to premium cigars. Advocacy recommends that FDA extend the analysis done on premium cigars to more product types so that the FDA can ensure that it is proposing the most effective and efficient regulation possible."

*Zeller struggled with this question on the webinar yesterday - going off on HOW premium cigars are smoked - as if it were different than anything else, therefore possibly less harmful; and who would buy them (not kids), etc. in attempting to justify the proposed exemption and the host bought it or didn't pursue any further - it's a 'red-faced' issue and they know it.
 

Kent C

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This may be as good as changing the grandfather date, but I think it goes outside of FDA's authority - except that it would force them to adjust to laws already on the books, perhaps. Certain Senators wouldn't go for it....

"Advocacy also recommends that the FDA should take into consideration small business stakeholders’ suggested alternatives to minimize the proposed rule’s potential impact. Small business representatives in contact with Advocacy observe that the FDA could still achieve its stated purposes for the premarket submission process in the deeming proposal through the use and enforcement of statutes and regulations already in effect. As an example, small business representatives note that under 21 U.S.C. § 387d(a)(1) and § 387d (c), manufacturers and importers of regulated tobacco products are required to submit (and update) specific information about the ingredients in each marketed product. Similarly, 21 U.S.C. § 387e mandates the registration of all domestic tobacco product manufacturing establishments and product listings for all regulated tobacco products manufactured at such establishments. Advocacy encourages the FDA to review and discuss statutes and regulations currently in effect as suggested by small business stakeholders that may already achieve the purposes of the premarket submission process in the deeming proposal. "

Basically, go ahead and deem these as 'tobacco products', but then go by the laws that already exist in relation to those products.
 

Bob Chill

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To what extent does the FDA have to take SBA Advocacy comments into account?

I can't answer the question directly but I did work as a contractor for the SBA for 3 years in their distressed asset portfolio sales. The SBA is very political about siding with small business owners. To them, the issue of whether ecigarette's are good or bad has nothing to do with their comment. It's all about the impact to the existing businesses and seeing them stepping in early like this to defend the businesses is a huge +.

The SBA has plenty of inter agency influence when it comes to issues like this. They clearly see the business side of the industry to be worth protecting. Why is a good question. I'm fairly certain it would be nearly impossible to obtain an SBA loan to open or expand a vape shop. That would likely rule out the SBA having a financial interest in the industry.
 

Stosh

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The SBA fighting with the FDA on what to present to the OMB to pass on or fail....
Why does this bring on an image of an old Godzilla vs. King Kong vs. Mothera flick, with the civilians (vapers) being stomped into the dirt?



king-kong-vs-godzilla.jpg
 

Kent C

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To what extent does the FDA have to take SBA Advocacy comments into account?

Any regulatory agency, including the FDA, must follow the path set out by the Regulatory Flexibility Act (RFA). IOW, a lot of paperwork, showing that they took into consideration the impact of the regulation as it would affect small businesses.

Here's an overview:

Office of Advocacy - Regulatory Flexibility Act - The Regulatory Flexibility Act | SBA.gov

From what I gather, it is a 'watchdog' but not an 'enforcement' group. The very last sections go toward 'enforcement' where businesses can ask for a judicial review where they think the agency has gone too far, etc. and the SBA Advocacy can act as an "amicus curiae (friend of the court) in any action brought in a court" as an advocate for the business.
 

Kent C

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How much does the SBA comment resemble a blueprint for what a comment is expected to be, for the FDA to take it seriously?

It would appear it took a team of lawyers at the SBA a few weeks to produce and publish the comment.

It coming from SBA Advocacy might have some influence, but the wording the deeming doc makes me think they're willing to go ahead without taking small businesses into consideration. They'll take their chances. They did the 'impact doc' to comply with the RFA, but rejected all other alternatives that would have been beneficial to small business. Again, I really think the Senators' letter is what is pushing this. .... well along with Zeller's regulatory zealotry.
 
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