[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
THE FOOD AND DRUG IMPORT SAFETY ACT
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON HEALTH
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
FIRST SESSION
ON
H.R. 3610
__________
SEPTEMBER 26, 2007
__________
Serial No. 110-68
Printed for the use of the Committee on Energy and Commerce
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COMMITTEE ON ENERGY AND COMMERCE
JOHN D. DINGELL, Michigan, JOE BARTON, Texas
Chairman Ranking Member
HENRY A. WAXMAN, California RALPH M. HALL, Texas
EDWARD J. MARKEY, Massachusetts J. DENNIS HASTERT, Illinois
RICK BOUCHER, Virginia FRED UPTON, Michigan
EDOLPHUS TOWNS, New York CLIFF STEARNS, Florida
FRANK PALLONE, Jr., New Jersey NATHAN DEAL, Georgia
BART GORDON, Tennessee ED WHITFIELD, Kentucky
BOBBY L. RUSH, Illinois BARBARA CUBIN, Wyoming
ANNA G. ESHOO, California JOHN SHIMKUS, Illinois
BART STUPAK, Michigan HEATHER WILSON, New Mexico
ELIOT L. ENGEL, New York JOHN B. SHADEGG, Arizona
ALBERT R. WYNN, Maryland CHARLES W. ``CHIP'' PICKERING,
GENE GREEN, Texas Mississippi
DIANA DeGETTE, Colorado VITO FOSSELLA, New York
Vice Chairman STEVE BUYER, Indiana
LOIS CAPPS, California GEORGE RADANOVICH, California
MIKE DOYLE, Pennsylvania JOSEPH R. PITTS, Pennsylvania
JANE HARMAN, California MARY BONO, California
TOM ALLEN, Maine GREG WALDEN, Oregon
JAN SCHAKOWSKY, Illinois LEE TERRY, Nebraska
HILDA L. SOLIS, California MIKE FERGUSON, New Jersey
CHARLES A. GONZALEZ, Texas MIKE ROGERS, Michigan
JAY INSLEE, Washington SUE WILKINS MYRICK, North Carolina
TAMMY BALDWIN, Wisconsin JOHN SULLIVAN, Oklahoma
MIKE ROSS, Arkansas TIM MURPHY, Pennsylvania
DARLENE HOOLEY, Oregon MICHAEL C. BURGESS, Texas
ANTHONY D. WEINER, New York MARSHA BLACKBURN, Tennessee
JIM MATHESON, Utah
G.K. BUTTERFIELD, North Carolina
CHARLIE MELANCON, Louisiana
JOHN BARROW, Georgia
BARON P. HILL, Indiana
_________________________________________________________________
Professional Staff
Dennis B. Fitzgibbons, Chief of
Staff
Gregg A. Rothschild, Chief Counsel
Sharon E. Davis, Chief Clerk
David L. Cavicke, Minority Staff
Director
(ii)
Subcommittee on Health
FRANK PALLONE, Jr., New Jersey, Chairman
HENRY A. WAXMAN, California NATHAN DEAL, Georgia,
EDOLPHUS TOWNS, New York Ranking Member
BART GORDON, Tennessee RALPH M. HALL, Texas
ANNA G. ESHOO, California BARBARA CUBIN, Wyoming
GENE GREEN, Texas HEATHER WILSON, New Mexico
Vice Chairman JOHN B. SHADEGG, Arizona
DIANA DeGETTE, Colorado STEVE BUYER, Indiana
LOIS CAPPS, California JOSEPH R. PITTS, Pennsylvania
TOM ALLEN, Maine MIKE FERGUSON, New Jersey
TAMMY BALDWIN, Wisconsin MIKE ROGERS, Michigan
ELIOT L. ENGEL, New York SUE WILKINS MYRICK, North Carolina
JAN SCHAKOWSKY, Illinois JOHN SULLIVAN, Oklahoma
HILDA L. SOLIS, California TIM MURPHY, Pennsylvania
MIKE ROSS, Arkansas MICHAEL C. BURGESS, Texas
DARLENE HOOLEY, Oregon MARSHA BLACKBURN, Tennessee
ANTHONY D. WEINER, New York JOE BARTON, Texas (ex officio)
JIM MATHESON, Utah
JOHN D. DINGELL, Michigan (ex
officio)
C O N T E N T S
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Page
H.R. 3610, to amend the Federal Food, Drug, and Cosmetic Act with
respect to the safety of food and drugs imported into the
United States, and for other purposes.......................... 125
Hon. Frank Pallone, Jr., a Representative in Congress from the
State of New Jersey, opening statement......................... 1
Hon. Nathan Deal, a Representative in Congress from the State of
Georgia, opening statement..................................... 3
Hon. Gene Green, a Representative in Congress from the State of
Texas, opening statement....................................... 4
Hon. Michael C. Burgess, a Representative in Congress from the
State of Texas, opening statement.............................. 5
Hon. Diana DeGette, a Representative in Congress from the State
of Colorado, opening statement................................. 6
Hon. Mike Ferguson, a Representative in Congress from the State
of New Jersey, opening statement............................... 7
Hon. John D. Dingell, a Representative in Congress from the State
of Michigan, opening statement................................. 9
Hon. Tim Murphy, a Representative in Congress from the
Commonwealth of Pennsylvania, opening statement................ 10
Hon. Anna G. Eshoo, a Representative in Congress from the State
of California, prepared statement.............................. 11
Hon. Jan Schakowsky, a Representative in Congress from the State
of Illinois, opening statement................................. 12
Hon. Heather Wilson, a Representative in Congress from the State
of New Mexico, opening statement............................... 13
Hon. Darlene Hooley, a Representative in Congress from the State
of Oregon, opening statement................................... 14
Hon. Steve Buyer, a Representative in Congress from the State of
Indiana, opening statement..................................... 15
Hon. Jim Matheson, a Representative in Congress from the State of
Utah, opening statement........................................ 16
Hon. Marsha Blackburn, a Representative in Congress from the
State of Tennessee, opening statement.......................... 17
Hon. Henry A. Waxman, a Representative in Congress from the State
of California, opening statement............................... 18
Hon. Tom Allen, a Representative in Congress from the State of
Maine, opening statement....................................... 20
Witnesses
Randall L. Luther, Deputy Commissioner, Policy, U.S. Food and
Drug Administration, Rockville, MD............................. 21
Accomapnied by: David Acheson, M.D., Assistant Commissioner,
Food Protection, U.S. Food and Drug Administration; and
Steven M. Solomon, D.V.M., Deputy Director, Office of
Regional Operations, Office of Regulatory Affairs, U.S. Food
and Drug Administration
Prepared statement........................................... 25
Answers to submitted questions............................... 164
William Hubbard, senior advisor, Coalition for a Stronger FDA,
Chapel Hill, NC................................................ 58
Prepared statement........................................... 59
Hon. Calvin M. Dooley, president and chief executive officer,
Grocery Manufacturers Association.............................. 63
Prepared statement........................................... 65
Answers to submitted questions............................... 159
Jill Hollingsworth, D.V.M., group vice president, food safety
programs, Food Marketing Institute............................. 68
Prepared statement........................................... 70
Caroline Smith DeWaal, food safety director, Center for Science
in the Public Interest......................................... 74
Prepared statement........................................... 76
Answers to submitted questions............................... 202
Alan Goldhammer, deputy vice president, regulatory affairs,
Pharmaceutical Research and Manufacturers of America........... 88
Prepared statement........................................... 89
Tom Kubic, executive director, Pharmaceuticals Security Institute 91
Prepared statement........................................... 93
Hallock Northcott, president and chief executive officer,
American Association of Exporters and Importers................ 104
Prepared statement........................................... 105
Answers to submitted questions............................... 196
Submitted Material
American Free Trade Association, submitted statement............. 211
H.R. 3610, THE FOOD AND DRUG IMPORT SAFETY ACT
----------
WEDNESDAY, SEPTEMBER 26, 2007
House of Representatives,
Subcommittee on Health,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 10:08 a.m., in
room 2123 of the Rayburn House Office Building, Hon. Frank
Pallone, Jr. (chairman) presiding.
Members present: Representatives Waxman, Eshoo, Green,
DeGette, Allen, Schakowsky, Hooley, Matheson, Dingell, Deal,
Wilson, Buyer, Pitts, Ferguson, Sullivan, Murphy, Burgess, and
Blackburn.
Staff present: Brin Frazier, Lauren Bloomberg, Melissa
Sidman, John Ford, Jack Mariko, Dave Nelson, Robert Clark, Chad
Grant, Nandan Kenkeremath, Andrew Woelfling, and Chris Knauer.
OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Pallone. I call the hearing to order. Good morning to
everybody. Today we are having a hearing on H.R. 3610, the Food
and Drug Import Safety Act introduced by our chairman, Mr.
Dingell, and I will recognize myself initially for an opening
statement.
Mr. Dingell's legislation seeks to strengthen our Nation's
import safety system, and I am also a proud co-sponsor of the
legislation. We all know that while the United States has one
of the world's safest food and drug supplies and some of the
most stringent standards for consumer protection, recent
outbreaks of contaminated products and cases of food borne
illness demonstrate that we have to do better. Contaminated pet
food, toothpaste, and seafood products from China have
highlighted the failings of our import safety system and
sparked fear and distrust among consumers.
Democrats in Congress have heard consumers' concerns, and
we have already begun to address the issue. Last week Congress
passed the Food and Drug Administration Revitalization Act,
which we call PDUFA, I guess, or includes PDUFA, and that bill
provides the FDA with the resources and the authority necessary
to improve our Nation's drug safety system. Also included in
this measure, however, are improvements to our Nation's food
safety program including new public notification requirements
of outbreaks of illness due to contaminated food. In addition,
the PDUFA legislation will establish an adulterated food
registry so that incidents can be reported and the FDA can
quickly alert the public. It also calls for transparency during
recalls of human or pet food, and will require the FDA to post
information on recalled products in an easy to use searchable
format.
Now while this was a modest step which was included, as I
said, in the PDUFA bill, a lot more can and needs to be done
with regard to food safety. The recent contamination incidents
raised questions about our current food and drug safety laws,
many of them enacted in the 1900s. Have they kept pace with new
techniques in food production and processing, are these laws
still sufficient to keep us safe. Rather than reacting to
outbreaks of contaminated products, we need to change our
system to better prevent such incidents from happening in the
first place.
Recently, a White House working group--and I actually spoke
to the FDA Commissioner about this yesterday--released a report
on Government import safety protocols. This report acknowledges
the limitations of our current import safety system and calls
for a shift basically to review not only our imports at the
point of entry in the United States, but also to regulate
production abroad. The report tells us what we already know
that the current system isn't working. The administration
recognizes its failings, a lack of coordination amongst
agencies, loopholes in the system that allow contaminated
products to slip in, but merely reporting on the problem is too
little and too late.
Now Chairman Dingell has taken the initiative in his
legislation that is before us today and proposed a solution for
increasing import safety including requiring agencies to
conduct research to develop better testing techniques and
insuring accurate labeling on products to prevent consumer
deception, and his bill would give the FDA the authority to
recall adulterated products if necessary. Chairman Dingell's
bill would also insure that products from other countries are
only permitted to enter the United States if they meet our
strict safety standards, and it puts in place regulations for
ports of entry, certification, and inspection that will enable
us to enforce this standard. These new process controls would
be paid for by a new imported food inspection fee.
The Dingell bill also addresses imported drugs by allowing
the FDA to assess and collect user fees on drugs imported into
the United States. These fees will help pay for inspectors,
laboratory tests to detect adulterated drugs, and overseas
inspections of drug shipments. But we know that contamination
isn't limited to imported products alone. In the last few
months, E. coli bacteria was discovered on lettuce and spinach
from California. We had to recall peanut butter due to
salmonella contamination, and botulism was found in canned
green beans. All of these recent examples actually involve
domestic products.
There are incidents of serious concern. The Centers for
Disease Control estimates that 76 million people became ill
this year and 5,000 actually died from illnesses caused by the
presence of microbial pathogens in their food. The spinach
contamination alone caused 200 reported illnesses and three
deaths last year. Now I have also introduced a bill that I have
actually had for a number of years that would strengthen
process controls on domestic products by establishing strict
inspection and oversight procedures to prevent contamination at
food processing facilities. It would require the FDA to set
standards for sanitation and limits for the level of
contaminations in food, and my bill would also require food
processing facilities to register annually, and it would
increase the number of inspections at facilities both in our
country and in the country of origin.
And I am looking forward to working with Mr. Dingell and my
colleagues. I know others have introduced legislation to
address these concerns as well. If I could just say in
conclusion that I think that improving our Nation's import and
domestic food and drug safety programs is of great importance.
I wanted to thank, he is not here, but Mr. Stupak, as you know,
has had a couple of hearings in the O&I Subcommittee on this
issue. The bottom line is that American consumers should be
able to trust that the products they purchased have been
properly regulated and inspected and thereby making them safe.
And that is why we are here today, and I thank all of you, and
the witnesses who are here to help us in that regard. And at
this point, I would recognize Mr. Deal, our ranking member, for
an opening statement.
OPENING STATEMENT OF HON. NATHAN DEAL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF GEORGIA
Mr. Deal. Thank you. During the month of August, I held
town hall meetings all across my district and repeatedly heard
from constituents who were concerned about the safety of their
nation's food supply. They asked about country of origin
labeling, imports from China, and wanted to know what was being
done to make sure that the food that they feed their families
is indeed safe. Coming from a town that calls itself the
poultry capital of the world, I am also very familiar with the
reciprocal impact that restrictions we place on producers in
other countries can have on our own domestic producers.
In my experience poultry imports are one of the first
products another country bans if they are upset with new United
States trade regulations. I am glad that we are holding this
hearing today so that we can look at these issues and try to
strike the right regulatory balance with legislation to help
address the concerns expressed by my constituents. However, it
is also important to recognize the complexities of these issues
and be careful that our legislation does not hamper the reforms
being made within the industry to provide consumer safe food
products. I know the administration will also be making some
recommendations shortly on import safety, and I believe it
would be useful for us to evaluate those recommendations as we
craft legislation on this subject.
Also, during our work on the Food and Drug Administration
Amendments Act of 2007 the issue of counterfeit drugs was
highlighted, and I am glad we are continuing to work on this
subject. While I am proud of the drug safety work that we did
in that bill, I want to thank Mr. Buyer of our committee who
raised a very valid point that if counterfeit medicines were
entering the drug supply then in fact it does undermine our
drug safety efforts. He has taken on himself to become perhaps
the best informed on a personal basis of this issue, and I
commend him for that.
I want to thank our witnesses on the panels here today for
their attendance. I look forward to your testimony on this very
complex issue, and we look forward also to your recommendations
as to how to solve the problems we face. Thank you, Mr.
Chairman, and I yield back my time.
Mr. Pallone. Thank you, Mr. Deal. And I would recognize now
our vice chairman from Texas, Mr. Green.
OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TEXAS
Mr. Green. Thank you, Mr. Chairman, for holding this
hearing on the Food and Drug Import Safety Act. There is no
question that glaring gaps exist in our food safety
infrastructure. The GAO concurs, and has dubbed our Nation's
food safety program as high risk. The news media has
highlighted the most high profile problem stemming from imports
from China. We have also held two hearings in the Oversight and
Investigations Subcommittee on food safety, with the most
recent hearing serving to investigate problems with the safety
of food imports.
This bill is a natural response to the problems that have
been uncovered in the news media, and in our own subcommittee
investigations. I support many of the provisions in the bill,
and applaud the chairman of the full committee for his
commitment to improving the safety of our Nation's food supply.
I will whole heartedly support provisions granting the FDA
recall authority over dangerous food. We learned through our
O&I process that the voluntary recall process does not quickly
and effectively protect Americans from tainted food, especially
given the FDA often issues recalls after the food's shelf life
has already expired.
My goal is for the FDA to become a more nimble agency ready
to respond to food safety threats in a time to make the
difference and keep Americans from getting sick, and I hope
these additional authorities will help them achieve that goal.
While the bill has many provisions I support, I would be remiss
if I didn't express my significant concerns about the language
that would restrict the number of ports of entry for food
imports. I am proud to represent the Port of Houston, which is
the largest port in the country in terms of foreign tonnage.
Granted, a good portion of that tonnage is related to our
energy sector, but the port had made it a point to increase the
number of food shipments it handles, more than 2.3 million tons
of food coming through the port of Houston the first 7 months
of this year alone.
In fact, the port of Houston is one of only four ports in
the country certified by the New York Board of Trade as a
coffee exchange, and we are the only coffee port west of the
Mississippi. Despite these commercial successes, the port would
essentially be shut out of the food import business under this
bill since no FDA lab is located in the Houston area. In fact,
there is no FDA lab in the State of Texas. To make matters
worse, no FDA lab located in the State despite the fact that
our State shares the longest border with Mexico, one of our
most prominent trading partners.
There is so much produce and foodstuffs that comes across
from Mexico through Texas land ports. I would think Laredo, TX
may be the largest inland port in the country, if not the
world, and yet there is no FDA lab in Laredo either. And I
looked at the investigation from the O&I Subcommittee, and I am
proud to serve on it, and I noticed the inspections that did
turn up a number of problems from China but the next biggest
country was Mexico. And so I think we need to do better on
figuring out how we can address that. The situation brings up
an interesting chicken or the egg scenario. Given the levels of
trade in Texas on our southern border with Mexico, why isn't
there an FDA lab located somewhere in Texas? It seems to be a
glaring omission that adds more weight to our argument that the
FDA simply doesn't have enough resources to adequately protect
the Nation's food supply.
On the flip side, there are only 13 FDA labs in the
country, several of which are not located in heavy import
areas. My neighbors in Arkansas would have to forgive me, but I
have never considered Jefferson, Arkansas, a hub of import
activity. I understand the chairman's desire to prevent port
shopping. I share his concerns. But I question whether the
presence of an FDA lab is really an appropriate reference to
determine the ports of entry for food products in the country,
and I fear this restriction of these imports to those extremely
limited number of metropolitan areas could not strike the right
balance in securing the safety of our food and supporting the
flow of commerce, commerce that keeps my port supplying much
needed jobs to my constituents who are the longshoremen who
work on those docks.
I look forward to hearing from our witnesses on this issue,
and hope to work with the chairman of the full committee as we
move forward in the process, and I share his goals of improving
food safety, but I hope we can do it in a way that doesn't
bring commercial activity in our country to a grinding halt.
Mr. Chairman, I yield back my time.
Mr. Pallone. Thank you. Next is the gentleman from Texas
also, Mr. Burgess.
OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF TEXAS
Mr. Burgess. Thank you, Mr. Chairman. I thank you for
having this hearing today. Just like Ranking Member Deal, I had
my town hall meetings last month, and heard repeatedly about
this issue, and the number of recalls of imported goods clearly
caught people's attention across the country. And I am
extremely concerned about the safety and security of household
products, food supply, and our Nation's pharmaceutical supply.
While I remain confident that America has the safest food
supply in the world, what I am more concerned about is the
safety of imported goods and particularly those imported from
the People's Republic of China.
My friend and colleague, Mr. Greg Walden, and myself sent
numerous communications to the committee over the past few
months asking for an investigation regarding the many food and
consumer products safety recalls from China. I continue to urge
the leadership of this committee to fully examine this matter.
I am also looking forward to the Oversight and Investigations
staff report from their recent trip to China, and I believe
this report will further inform the legislation that we have
under consideration today. America does have the safest, least
expensive, most abundant food supply of any country in the
world.
In the past, whenever I went into a supermarket to buy food
for myself or my family, you pick it up and you worry about,
No. 1, does it taste good, No. 2, well, if it was in the 1980s,
I worried about fat grams, in the 1990s, I worried about carbs.
But now I worry about is this stuff going to make me sick? We
just never had to stop and wonder about is the food safe to
eat, is it going to make someone in my family ill, and the
security of our food supply in my mind has never been in
question, but I believe that while it is safe and secure the
recent outbreaks of both E. coli and salmonella have caught the
country's attention. Certainly they have caught my attention.
The industry itself can really scarcely afford further
erosions in consumer confidence of its products. I thank
Chairman Dingell for his attention to this matter. Having
reviewed the legislation, I think the intentions are good but,
we all know when God is in the plan, the devil is in the
details. I believe that we need to look toward how other
Federal agencies have dealt with this issue, and whether it
would be appropriate for the Food and Drug Administration to
have similar authorities. I am very interested in a proposal
developed by Dr. Bill Hubbard, former FDA associate
commissioner. He has been here in this committee, and we have
heard him testify in the past at numerous hearings. His
approach would grant the FDA the authority to embargo if
specific food from a specific country, much like the similar
authority the USDA has in regard to meat and meat products. My
staff and I have reached out to the FDA on a number of
occasions, and now I am gratified that we are going to be
getting together to review some aspects of that proposal.
I am hopeful that moving forward we can discuss the matter
fully with the agency. Now we just have come through the S-CHIP
battle, Mr. Chairman, and I hope that is a lesson for us in
this committee. This subcommittee is important. This
subcommittee has some of the most intelligent Members of the
people's house on both sides of the dais, and it is an affront
to this subcommittee to push major legislation through the U.S.
House of Representatives without the input of this
subcommittee, and I trust we will not see a repeat of that in
the future. I will yield back the balance of my time.
Mr. Pallone. Thank you. I recognize the gentlewoman from
Colorado, Ms. DeGette.
OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF COLORADO
Ms. DeGette. Thank you very much, Mr. Chairman, and thank
you for holding the hearing today. I got involved in food
safety legislation some years ago when a meat processing plant
in my home State of Colorado sent out contaminated meat all
around the West. And what I learned is probably the most
important thing we can do as Members of Congress is work hard
to protect the health and safety of our constituents. When our
constituents to go the grocery store and buy a package of
hamburger or when they buy spinach to give to their children
because they think it is a healthy choice, they rely on our
Government and our food safety agencies, all 13 of them, to
make sure that their food is wholesome and safe for them to
eat.
That system has pretty much fallen apart from top to
bottom, I think in large part because of imports from overseas
in the last few years, and people are shocked by the continuing
number of food safety issues we have. That is why I want to
thank Chairman Dingell for developing comprehensive draft
legislation that will deal with the issue of both resources and
accountability. It seems to me there is a number of issues we
need to discuss in the food safety issue. The first and key
issue is resources. Our food safety agencies do not have the
resources to do the job that we have been asking them to do and
which increasingly they need to do. Second, the administration
needs to think about how they are going to insure food safety.
And, frankly, closing down FDA labs like the lab in my own back
yard at the Federal Center in Denver is really not the way to
go.
I have a whole different set of concerns about the FDA labs
that Mr. Green has, and one of them is that we are going to
lose scientists who have years and years of experience. The
response from industry has been somewhat more responsive, and I
am happy to hear later today from the Grocery Manufacturers
Association about their proposals. There are a couple of issues
I have been working on ever since I got involved in these
issues some years ago. The first one is giving mandatory recall
authority to the FDA. People are shocked when they find out
that the Consumer Product Safety Commission can recall toys
although it is cumbersome but that we can't recall tainted baby
food that we feed to those same babies. We need to have
mandatory recall authority for a variety of reasons.
Second, and there is a bill, H.R. 3484, that I have
introduced that grants mandatory recall authority to the FDA
and to the USDA. The second issue that I would really--I am
glad the chairman has arrived because I would really urge him
to look at this in the legislation. That legislation I have
been working on, H.R. 3485, the Trace Act, which would set up a
product tracing system that would track food from the farm to
the grocery store which would enable to recall in the event of
contamination. That also would help us go a long way in keeping
our food supply that we give to consumers safe.
Mr. Chairman, the bill before us is a great start. I am
happy that we are having a hearing on it, and I look forward to
working with you and the chairman of the full committee to
making sure that we pass comprehensive food safety legislation
in this session of Congress. Thank you.
Mr. Pallone. Thank you. The gentleman from New Jersey, Mr.
Ferguson.
OPENING STATEMENT OF HON. MIKE FERGUSON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW JERSEY
Mr. Ferguson. Thank you, Mr. Chairman, and I want to thank
you and Mr. Deal and members of the subcommittee and our
witnesses for being here today to discuss this very important
issue of the safety and the security of our country's food and
drug supply. I am pleased that we are again addressing this
critical issue in this most important subcommittee. It is
paramount to the citizens of this country that they are able to
have faith in our Government's ability to monitor and insure
the safety of our food and our drugs. Recently, that has not
been the case with several instances of toxic food and
counterfeit drugs entering our supply chain.
I hope that our witnesses today will be able to provide us
with some insights to why there are perhaps some gaps in the
security of our imported food and drugs. My biggest concern,
and I believe perhaps the biggest concern of many of us, is how
counterfeit drugs are entering our market place. How and why is
this happening. My friend from the other side of the aisle who
just spoke, Ms. DeGette, summarized the situation very well in
a hearing earlier this year at a meeting of this subcommittee.
She was speaking about the topic of a recent New York Times
investigation that found that toxic cough syrup was being
manufactured in China and shipped around the world.
Even under the current construction of the law the dangers
of counterfeit drugs are very, very real. I believe we need to
grant the FDA the power and the authority to seize and destroy
and investigate the origin of these counterfeit drugs. Alarming
counterfeiting is happening not only with imported drugs but
with our food supply, as we have heard several instances of
that mentioned this morning, before they come here to the
United States. Recently, the Agriculture Committee and the FDA
provided testimony concerning imported aquaculture products
from China containing unapproved antibiotics and contaminants.
This is pretty disturbing as to why these products containing
unapproved ingredients that can be harmful or even deadly to
the consumer are making their way to American supermarket
shelves.
This shipment from China was found to contain nitrofurans,
which has been shown to be a carcinogenic in animal studies. It
is really unacceptable that food containing this harmful
contaminant should be entering America's food supply, I hope
that we will be able to address these and other important
safety issues in the coming weeks. I look forward to the
testimony of our witnesses. I particularly appreciate Chairman
Dingell and his bill and the work that he has done on his
legislation. I appreciate the seriousness with which he has
taken up this issue, so much so that he has worked on
legislation and introduced legislation to do so.
I also hope as we move forward that the work of this
subcommittee and this legislative product will include the
very, very good work of our colleague, Mr. Buyer. As Mr. Deal
mentioned earlier, he has really taken it upon himself to do
extraordinary work and research and working on legislation that
would address this counterfeit drug issue, and I am very
hopeful and optimistic that in a bipartisan way that our
committee, this subcommittee, and our full committee can come
together to incorporate many of the good parts of the work
product that Mr. Buyer is putting together as well. Thank you,
Mr. Chairman. I yield back.
Mr. Pallone. Thank you. I next recognize the chairman of
the full committee and the sponsor of the legislation, Mr.
Dingell.
OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MICHIGAN
Mr. Dingell. Mr. Chairman, first of all, thank you for
holding this hearing today. I appreciate your leadership, and I
commend you for your vigorous efforts in this matter. Our
Nation's consumers are experiencing a significant crisis, and
confidence in the imported food products and other products
they import. For months Americans have been inundated with
reports about tainted products shipped from abroad, melamine
tainted pet food, antibiotic tainted seafood, lead tainted
toys, tainted counterfeit drugs, and counterfeit drugs that do
nothing that we know of beneficial, and so on.
As these reports have surfaced, the Subcommittee on
Oversight and Investigations led by our able colleague, Mr.
Stupak as chairman, intensified its investigation into how the
Food and Drug Administration works to protect the public health
against tainted food and drug and appliance imports. The
preliminary results of these ongoing investigations revealed an
under funded importation safety system equivalent in the terms
of holes to a block of Swiss cheese. It is clear that Food and
Drug cannot and is not doing its job for want of money, for
want of staff, for amount of resources.
We hear periodically about how they are going to be a
leader organization, and how they are going to do more with
less. I have been listening to that since I came on this
committee long ago, and I must say that today it is as much
phooey as it was then. Last week, Mr. Chairman, you and
Chairman Stupak joined me in introducing H.R. 3610, the Food
and Drug Import Safety Act. And I would urge my colleagues here
in the committee and others of our colleagues in the Congress
to join us in co-sponsorship with it. This legislation takes a
vigorous proactive step towards correcting the problem of
tainted food and drug imports. It closely resembles the
discussion draft, which I released earlier in August.
I would point out in response to comments I have heard from
my colleagues on both sides it is my full intention that this
matter will be pursued both vigorously and in a bipartisan
fashion. And I invite my colleagues on both sides, Republicans
and Democrats, to join in that undertaking, and I assure them
that we are anxious to hear what they have to say about this
because this committee will work best when we cooperate on
matters of this importance. The legislation that we are
discussing aims to increase Food and Drug Administration
inspections both at the border and abroad by instituting a
small user fee. That is something we have found is necessary
because without this kind of financing there will be no
adequate performance by Food and Drug, no adequate resources,
no adequate staff or funding.
The fee would also fund laboratory analysis to insure that
imports are safe to enter our stream of commerce, and I would
observe that the efforts of Food and Drug to close its
laboratories have been met with uniform condemnation
particularly from this committee. Next, it grants the authority
to ferret out bad actors that seek to game the current
regulatory system and pass off bad products as safe for
consumption, a problem which we read about almost daily in the
press. As our committee staff stated in their July 2007 report,
FDA's current regulatory approach, which relies on voluntary
guidelines for most foods, is inadequate to assure the safety
of our modern food supply.
I would observe that the credo down there and the mechanism
under which this appears to be done is to trust us, and we have
found to our regret that we simply cannot trust that kind of
activity to an agency so poorly funded and so poorly staffed.
Finally, the bill seeks to attempt a balance by rewarding those
who employ best practices allowing them to participate in a
voluntary program that gives expedited movement of food imports
through the food inspection system.
Mr. Chairman, I look forward to the comments of my
colleagues today, and the testimony of our witnesses today as
the committee seeks to protect the public health from tainted
food and drug imports. I would urge that we be vigorous. I want
this to be a bipartisan effort. We will build upon the things
which we did in the earlier legislation on this matter, and the
commitments I made to my colleagues--that we would hear all
Members when we commence the process--remain as good today as
they were when we made them earlier. So I urge my colleagues to
work together. This is a serious effort to protect the public
health, the public safety, and the public welfare from serious
wrongdoing, which is now hurting us. I thank you for your
recognition.
Mr. Pallone. Thank you, Chairman Dingell. Next is Mr.
Murphy of Pennsylvania.
OPENING STATEMENT OF HON. TIM MURPHY, A REPRESENTATIVE IN
CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA
Mr. Murphy. Thank you, Mr. Chairman, for holding this
important meeting and hearing on an issue that is so vitally
important to America's livelihood, and actually our lives and
our families. Several things that we are going to cover today
are important with regard to the FDA's role in protecting our
Nations' medicine cabinets. There is a role for the FDA, I also
believe in regulating our food supply, and such things as
counterfeit imported drugs, which of course mean that you may
have people who are taking drugs with toxins in them or
ineffective drugs which actually are contributing to their own
health problems. We want to make sure the FDA focuses as much
of its attention nowadays on drug safety as new drug approval.
As appalling as it is to think that manufacturers would be
involved in this outside of the criminal labs, we have to be
aware that we are going to have a more vigilant role in dealing
with this. And that is probably because of the Nation's
increased awareness of what has been happening with China.
China, who we have a great deal of trade with and we would like
to be a good trading partner, but when we have raised questions
about steel dumping or manipulation of their currency if their
response is that they are going to sell off their treasury
bonds to be punitive it hardly seems to be the words coming
from a partner.
Furthermore, they give us the toys with lead paint, bibs
and vinyl lunch boxes with lead, diapers with fungus,
contaminated pet food, reused chopsticks, tires that cause
fatal accidents, juice with unsafe color additives, baby
bottles with an ingredient that can alter a child's hormones,
pacifiers with carcinogen, carcinogenic chemicals, teething
rings with toxic chemicals, and also let us not forget they
have spied on us, they have cyber techs in the Pentagon, they
have stolen our national secrets, they have provided bullets
and bombs and their components are used to kill our soldiers in
Iraq, and to supply the Taliban. This is not the action of a
friendly nation to us.
The FDA is on the front lines of protecting American
citizens' health, but really in the broader scheme of things
this can be an important partnership between the FDA and the
American people in making sure the American people are aware of
any problems with any products, that such products are recalled
quickly, that action is taken to inspect at our borders and put
increased pressure on China and any other nation that tries to
violate the laws and the protections that we consider so
important for people's welfare and health.
Mr. Chairman, as we continue on with this and other
hearings, we will hear more and more horror stories of things
that have happened, and American companies need to be vigilant.
But let us not forget it is not the companies themselves that
are involved with this. Companies cannot possibly babysit
everything that happens with a nation where they consider it a
common practice to go ahead and have lower health standards,
lower wages, pollute the air more, and expect our citizens to
pick up the tab on this or perhaps turn a blind eye. We will
not do that as a nation. We will not do that as a Congress. And
I am pleased this committee is going to take firm action on
making sure that we draw out every possible exposure of this
and get the FDA as a strong partner to protect the health and
welfare of American citizens. I yield back.
Mr. Pallone. Thank you. I recognize the gentlewoman from
California, Ms. Eshoo.
Ms. Eshoo. Thank you, Mr. Chairman. I am going to waive my
opening statement time and save it for questions. Thank you for
having this really critically important hearing.
[The prepared statement of Ms. Eshoo follows:]
Prepared Statement of Hon. Anna G. Eshoo, a Representative in Congress
from the State of California
Mr. Chairman, I thank you for convening today's hearing on
H.R. 3160, the Food and Drug Import Safety Act, legislation
that would give the Food and Drug Administration enhanced
authority and resources to inspect imported foods and drugs, as
well as additional authority to protect public health.
Even before reports this year about tainted foods and
consumer products coming into our country, there have been
substantial concerns about the safety of our food supply.
The CDC's estimates of foodborne illness have been
startling: 76 million illnesses, 325,000 hospitalizations, and
5,000 deaths each year.
The domestic inspection and monitoring system for food is
not nearly as rigorous as it should be. The authority of the
major food safety agencies to enforce standards and recall
suspect food has been virtually non-existent. That's why I'm
pleased that H.R. 3160 grants recall authority to the FDA.
The major concern now is the ability of food safety
agencies to keep pace with the rapid increase of food imports.
The FDA, which is under the jurisdiction of the Energy and
Commerce Committee, is responsible for ensuring the safety of
approximately 80 percent of all food products--virtually every
food item that is not meat or poultry. In the last decade the
volume of food imports under FDA's purview has tripled. At the
same time, the percentage of shipments inspected by FDA has
dropped from 1.7 percent to 1 percent.
Unlike the USDA's Food Safety and Inspection Service, which
bars the importation of meat and poultry unless the country
from which the product is shipped has been certified as having
standards equivalent to U.S. standards, the FDA does not
require equivalency certifications. Instead, FDA relies on
inspections of imported goods to protect consumers.
My understanding is that the FDA has stated that it does
not have the resources to implement equivalency certifications.
H.R. 3160 attempts to address this problem by imposing user-
fees to expand inspections and by requiring equivalency
standards.
Much more needs to be done to improve food safety, and the
legislation we're examining today will help plug some of the
holes in the food safety system. I look forward to the
testimony we'll hear from today from the FDA and other
witnesses.
----------
Mr. Pallone. Thank you. Ms. Schakowsky.
OPENING STATEMENT OF HON. JAN SCHAKOWSKY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ILLINOIS
Ms. Schakowsky. I thank you, Chairman Pallone, for holding
today's hearing on the Food and Drug Safety Act. I thank
Chairman Dingell for this important legislation which makes
crucial strides in strengthening FDA's ability to monitor the
safety of our Nation's food and drug imports. During the past
year, consumer confidence in our Nation's food safety framework
has been shaken time and time again particularly by tainted
imports. Cases of poisoned toothpaste, antibiotic laden seafood
and toxic pet food demonstrate how we rely on the food safety
practices of foreign countries and producers, and illustrates
the importance of the legislation before us today.
More than $75 billion worth of food and agricultural
products are imported into the United States annually, which is
nearly double the value of just over a decade ago before NAFTA
and WTO took effect in the mid-1990s. In 2005 nearly 15 percent
of all U.S. food consumption was imported. Despite the increase
in imports FDA estimates that in 2007 it will conduct border
inspections on only a paltry 0.6 percent of the food it
regulates down from 8 percent just a decade ago. USDA, while
not a model of perfection, has at least managed to inspect 11
percent of the beef, poultry, and other products it regulates
in 2007. Chairman Dingell's bill incorporates several crucial
and common sense solutions to the present food safety crisis.
The bill would provide FDA with the additional resources and
authority it needs to certify and inspect food safety
procedures of foreign countries and facilities as well as the
products entering our ports.
It institutes country of origin labeling, something that 92
percent of Americans support within 6 months of the bill's
enactment into law. I am particularly pleased that it gives the
FDA the authority to issue mandatory product recalls and halt
imported products until a foreign entity has resolved the
problem. These measures will help prevent future food safety
outbreaks and help restore the shaken consumer confidence.
While I strongly support the intent of this bill and the vast
majority of the solutions it proposes there are some provisions
that I believe need more discussion. Sections 3 and 4 require
the Health and Human Services Secretary to assess and collect
user fees to fund inspections, lab testing, and research on
testing techniques for food and drug imports.
I fully support the emphasis on proactive safety
inspections and testing. However, if we are forced to rely on
user fees, I am concerned that we make it clear that those
companies that pay those fees do not have undue influence on
agency policies and practices. The subcommittee has worked to
address this problem, and the FDA's drug approval process, and
I hope, in fact, I am sure, that we can prevent similar
problems here.
I am also concerned with provisions in section 5 that would
restrict the number of eligible ports from the current number
of more than 300 to just 13, excluding some of our Nation's
busiest ports such as Chicago, which I represent part of, and
Houston and Boston. While the Secretary has the authority to
waive this requirement, I believe we need to create a food
safety system that enables busy ports like Chicago to continue
receiving food imports. I am interested in hearing more about
the consequences of the drastic reduction on areas with no
direct port access as well as how we can insure transparent and
accountable decision-making process with regard to this waiver
authority.
There is much work to be done to restore consumer
confidence in our Nation's food supply, the kind of food safety
framework that will make the high profile cases of this year a
thing of the past. And I look forward to hearing from all of
the witnesses. With that, I yield back. Thank you, Mr.
Chairman.
Mr. Pallone. Thank you. I recognize the gentlewoman from
New Mexico, Mrs. Wilson.
OPENING STATEMENT OF HON. HEATHER WILSON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW MEXICO
Mrs. Wilson. Thank you, Mr. Chairman. The events over the
last year really highlighted for Americans and raised awareness
of just how vulnerable our food supply is, and it is not just
food. It is food, medicine, consumer products, even our water
and the things that we drink are vulnerable to contamination.
Not only accidental contamination or what might have been
unintentional or the result of bad sanitary practices in
companies that are poorly regulated overseas but the potential
for intentional contamination of our food supply. It is a
serious issue, and we have a duty in this Congress to make sure
that imported food and goods are safe from contamination
whether accidental or intentional, and make sure that any
problem with the food supply is detected so that we prevent
public health problems before they occur.
My colleagues on this committee have recounted the problems
that we have had with China, but it is not a single country
issue. Globalization creates a vulnerability here in the United
States and starting at our border is not where we need to be. I
believe very strongly that we need an integrated system for
food safety and security with layers of protection. I look
forward to the testimony here today, and looking at the
legislation in front of us to make sure that we are providing
that integrated system for food safety and security rather than
setting up a system where there are single points of potential
failure after which public health problems can occur. We have a
food safety laboratory in the State of New Mexico at New Mexico
State University, and I am a strong supporter of what they do,
not only in food technology and evaluation but also in a
counterterrorism technologies laboratory where they develop
tools in order to make sure that our food supply is safe.
I look forward to hearing the testimony of the witnesses
today, and look forward to working with my colleagues on the
committee to make sure we strengthen our ability to prevent the
intentional or unintentional contamination of America's food
supply. Thank you, Mr. Chairman.
Mr. Pallone. Thank you. The gentlewoman from Oregon, Ms.
Hooley.
OPENING STATEMENT OF HON. DARLENE HOOLEY, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OREGON
Ms. Hooley. Thank you, Mr. Chairman. I first of all want to
thank you and Chairman Dingell for your leadership on food
safety issues. I know this is an issue that the chairman cares
about very deeply, and I am glad we are taking up this
legislation. I too want to make sure that we can assure the
American public that our foods and other products are safe.
Recent incidents involving adulterated products from China have
again brought to the forefront the critical importance of food
safety. Although the vast majority of food entering the United
States is safe, now is the time to act to strengthen our system
to limit harmful food products from entering the country.
Monitoring the safety of imported foods is a tremendous
challenge for FDA. Over 825,000 different importers brought
shipments into the United States last year. Those importers
bring products to approximately 326 ports. The value of U.S.
imports has nearly doubled since fiscal year 2000. The FDA's
resources are stretched too thin to meet the growing demand of
its inspectors. Fortunately, I think almost universal agreement
exists on that point, that the FDA needs more resources to its
job properly. I also believe it is vital to insure that our
food is not only safe but that we work to permit the free flow
of goods into the United States. The safe and secure food
importation program is an important step to help expedite the
importation of food from those parties willing to abide by
rigorous food safety guidelines established by the FDA.
This program provides the appropriate incentives to
importers by rewarding those who take extra steps to ensure
safety. I also look forward to hearing from our witnesses today
regarding the provisions restricting port of entry to only 13
ports. I believe that steps can be taken to help ensure we are
able to better inspect imported foods, but I believe we can do
so in a less burdensome manner. I have a significant food
processing industry in the district I represent. I am concerned
about the impact restrictions on port of entry may have on
consumers and the food processing industry by making them wait
longer to get fresh products.
I also fear that having only 13 ports of entry will raise
production costs and put food processors in the fifth district
at a competitive disadvantage to those cities with an FDA lab,
without materially improving safety. I believe we can find
other alternatives that ensure safety and still meet the needs
of our consumers and producers. As the author of the country of
origin food labeling, COOL provisions for produce passed in the
2002 farm bill, I believe COOL can be an important resource for
consumers. It is also critical to ensure such requirements can
be practically administered.
COOL with processed foods present challenges that are not
present with fresh produce or meat. I hope our witnesses will
share their thoughts on the impact of COOL as it relates to
processed foods in particular, and practical approaches to
implementing such requirements. I look forward to working with
Chairman Pallone and Chairman Dingell as we move forward with
this very important legislative process on H.R. 3610. Thank
you, Mr. Chairman, and I yield back the remainder of my time.
Mr. Pallone. Thank you. Mr. Buyer from Indiana.
OPENING STATEMENT OF HON. STEVE BUYER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF INDIANA
Mr. Buyer. Thank you very much. And to Chairman Dingell, I
want to thank you for giving me the opportunity to work with
you and your staff. As I traveled the country and went to our
mail facilities and to our private carriers, I learned that
your staff, and, Mr. Pallone, your staff had also been there.
In 3 minutes I can't even cover the vast--my summer, what I did
on my summer vacation. But what I would like to do is say I
believe that our ideal is to insure the highest standards of
health care for Americans. We do that with regard to health
care. The demands for high standards are placed upon our health
providers, our pharmaceuticals, our medical devices, our
medical technologies, our medical research.
But with regard to drugs and medical devices, how do we
protect our system? We look to the FDA as the gold standard but
then when you think about this, we just passed PDUFA, and
PDUFA, and all the dollars, the hard work that we put into the
reauthorization I believe is useless if we cannot protect the
system and close it off from the harmful products and bad
actors who are these counterfeit criminal syndicates that are
preying upon Americans. We must safeguard citizens from unknown
dangers using the information we have on the threats to
America's health. We know that there are multi-million dollar
worldwide criminal enterprises doing business growing at
unfathomable rates to manufacture counterfeit drugs. 20,000 to
30,000 packages enter each of our 12 international mail
facilities every day, and that is not counting the private
facilities.
Less than 1 percent of these packages are screened by FDA.
That means 99 percent of them are sent to individuals across
the Nation without ever being inspected, much of which, in
excess of 70 percent perhaps, are unapproved drugs. Now when
you look about how many times we have touched this law, we
touched it back in 1938. Chairman Dingell and his initiatives
in 1988 touched this issue. So if you will indulge us, Mr.
Chairman, I hopefully will have a discussion draft, it has been
at the leg counsel here for the last 2 weeks, by mid next week.
What we propose to do is give FDA the authority to destroy
counterfeit drugs coming into our postal system and the private
carrier system, give FDA the authority to seek the disgorgement
of counterfeiters profits.
We want to increase minimal Federal standards to States to
use in licensing prescription drug wholesalers. We want to
implement a Federal pedigree standard so we can effectively
trace prescription drug products throughout their chain of
custody. This further secures our domestic supply chain from
bad actors. We want to establish the electronic pedigree
standards to modernize our system and prevent fraud of paper
pedigrees. We want to work toward a goal of serialization of
all products, prescription drugs, so we can further protect
them from the counterfeiters.
We will also enlist State's help in tracking counterfeiters
down by providing them with some financial incentives to help
the Federal Government. We also will insure that any repackaged
drug products are held to the same high standard as the
original drug products, insure also that drug wholesalers
engaged in criminal counterfeiting activities are debarred and
prohibited from future work with the FDA. We want to create a
study to investigate the international domestic threats to the
Nation's drug supply. So, Mr. Chairman, I want to continue to
work with you. We will get this discussion draft hopefully back
from leg counsel, get it to your staff, and we all will get
this and work together. And I appreciate, Chairman Pallone,
working with you and Chairman Dingell, along with Mr. Deal. I
appreciate your leadership along with Mr. Barton and his staff.
Thank you.
Mr. Pallone. Thank you. The gentleman from Utah.
OPENING STATEMENT OF HON. JIM MATHESON, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF UTAH
Mr. Matheson. Thank you, Mr. Chairman. Clearly, this is an
issue of great concern. We want to ensure the integrity of our
food supply. And I think it is a complicated issue, and to
resolve it, I think that a good bipartisan effort is the best
way to go about it. I think this committee can really step up
to the plate in that regard. I think we need to take a look at
this in the context of the global market place, and we need to
look at the whole chain, supply chain, if you will. I would
suggest that you could connect this issue with the toy safety
discussion that is also going on in another subcommittee. In
that case, we are looking more at the manufacturing end. In
this case, I am hearing a lot about the domestic end of the
equation where we inspect food when it gets to our country. I
would suggest we need more of a blended approach, and we ought
to be looking at the supply chain in general about where we can
make the most rational and efficient efforts to ensure the
integrity of the food supply.
And this discussion seems to be a lot about imported food
but we also of course should not forget our domestic production
as well and make sure that food produced domestically can be
assumed to be safe when it reaches a family dinner table. There
are two issues I just wanted to raise briefly in this opening
statement of concern to me that I think we need to keep in mind
as we look at this broad issue of food safety. The first has to
do with the impact on our relationships with our trading
partners. I am concerned that this effort at addressing food
safety concerns could invite a more protectionist agenda than I
think would be appropriate or good for this country, and I
think as we look at this issue we ought to make sure that does
not happen. I think we should recognize that there--and we
should ask questions about how the existing WTO agreement that
talks about the application of sanitary and by sanitary
measures how that does work and if there are issues that we
ought to think about to make it work better then I think we
should recognize we are in that global market place, and we
should try to maintain the integrity of that global market
place.
The second issue I want to raise that we ought to be
looking at has to do with comments that FDA provided during the
Agriculture Appropriations Subcommittee hearing on food safety.
FDA issued some concerns about imported aquaculture products,
seafood products, and the issue of antibiotic resistance, based
on antibiotics being used with the seafood product. I think
that is a very important issue when it comes to the issue of
the development of antibiotic resistant diseases. I plan on
introducing legislation this week with my colleague,
Representative Ferguson, which seeks to address this issue
about how this country can better position itself for trying to
develop new antibiotics that can take on these organisms that
are currently resistant to current antibiotics, and I think
that is an emerging public health concern and it turns out even
in this food safety discussion that public health concern is
now merged as well, so those are just two quick issues that I
think we also ought to keep in mind as we look at this broad
food safety issue. With that, I will yield back, Mr. Chairman.
Mr. Green [presiding]. Mrs. Blackburn.
OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF TENNESSEE
Mrs. Blackburn. Thank you, Mr. Chairman. I would like to
thank the chairman for calling the hearing to discuss all of
our issues with FDA oversight and the food and drug imports
into the country. This is indeed a critical public safety issue
as well as a national security concern, and when we hear the
reports as we have heard in recent days about the episodes
around the country, we do become keenly aware of the potential
for terrorists to exploit these weaknesses. The combined
efforts of the food industry and the regulatory agencies are
often credited with making the U.S. food supply the safest in
the world. And we know that we have at least 15 different
agencies administering over 30 different rules related to food
safety.
And in spite of this widespread approach, we have a
tremendous track record of success and those involved in that
process are to be commended. We know that the FDA is
responsible for insuring that all domestic and imported food
products except most meats and poultry are safe, nutritious,
wholesome, and accurately labeled. Although all imported food
products must meet the same safety standards as domestically
produced foods, international trade rules permit a foreign
country to apply its own differing regulatory authorities and
institutional systems in meeting such standards under an
internationally recognized concept known as equivalence.
As Americans consume increasing amounts of imported food
and drink and as U.S. producers are demanding more overseas
ingredients, we see an increase in this volume. Globalization
is playing a part. It has tripled our imports in the past
decade. I was impressed by the staff that the FDA received more
than 10 million imported food entries in 2006 and compared that
with less than 2.8 million entries in 1996. That is an
indication of the volume that is before the agency. Just over 1
percent of these shipments were physically examined in fiscal
year 2006 compared with 1.7 percent in fiscal year 1996.
According to the USDA, the United States is expected to import
a record 70 billion in agricultural products this year.
The legislation before us today causes some concerns to me
with the user fees, the trade implications, new labeling, the
negative impact on small business with these user fees and
those being passed on to the consumer, and of course the
bureaucracy that is there. I am also concerned about the
restriction of ports of entry and what that would do to food
plants that are not in close proximity to a metropolitan area.
But, Mr. Chairman, I look forward to the discussion, and I
thank the committee for the efforts spent on the issue. I yield
back.
Mr. Green. Mr. Waxman.
OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Mr. Waxman. Thank you very much, Mr. Chairman. There
doesn't seem to be a day that doesn't go by when we pick up the
morning newspaper and we hear about the dangers of some
imported product that turns out to be unsafe. We have been
hearing a lot about toys. We have been hearing about lead. And
we have been hearing particularly alarming information about
food that comes into our country from foreign lands that are
not safe. So we need to do something about this issue, and I
want to point out that I think this Food and Drug Import Safety
Act of 2007 makes some critical steps forward getting FDA what
it needs to protect the American public.
And I want to applaud Chairman Dingell for the good work he
has done on this legislation. The bill, as we look at this bill
at this hearing today, makes important improvements to food and
drug import safety, but its most dramatic and in some ways most
critical changes would affect food imports because the bill
deals not just with food imports but other imports within the
jurisdiction of the FDA. If we look at FDA, FDA's experience
with food importation, we want them to focus on securing the
entire supply chain, not just stopping unsafe foods at the
border. The bill would give the FDA clear authority to require
a recall of unsafe foods. The bill provides for strong civil
monetary penalties to hold bad actors accountable, and it has a
strong food regulatory system. All of this represents an
important step forward.
I was pleased to listen to the very thoughtful statement of
our colleague, Congressman Matheson of Utah, where he pointed
out we need to look at the whole chain of the food supply from
the original source. And so this legislation doesn't just deal
with the problem at the border, it requires that within 5 years
FDA would have to certify that all food importers, either
individual facilities or countries, have a system in place to
insure the safety of the foods that they export to the United
States.
I think this makes a lot of sense. If they don't have a
system in place then FDA would be required to go and examine
the facility itself. It may be impossible for FDA to review and
certify the overwhelming volume of facilities in countries
seeking to enter the U.S. market. If that is so, we are all
going to lose so I hope the FDA will provide some guidance on
what exactly it needs to do this important job. I want to raise
an issue of concern about the user fee. I think we rely too
much on user fee, and I also want to point out as Mr. Matheson
did, we have a domestic food supply question as well, and I
know that Chairman Pallone has introduced a bill that I think
is highly commendable on this subject.
But let us go into this issue with the expectations that we
are going to get the job done, but let us don't fool ourselves.
We don't provide the authorities, and if we don't provide the
resources FDA will do the best it can but it will fall short of
what needs to be done. And I hope we don't have another hearing
in another year that the problems have not got resolved.
Mr. Green [presiding]. Mr. Pitts.
Mr. Pitts. I would like to thank the chairman for holding
this vital hearing, this hearing on a very vital issue, food
and drug safety for the American people. And I would like to
thank the gentleman from Indiana, Mr. Buyer, for his leadership
on this issue, and would like to yield the balance of my time
to him.
Mr. Buyer. I thank the gentleman. I would like to say to
Chairman Dingell, back in 1988 when you touched this issue, we
didn't have the Internet, and the Internet is presenting great
challenges to the protection of our system today, so when
people believe they can get on the Internet and they pull up a
Canadian Web site, and these Web sites can go up one day and
down the next. For example, I don't want to give great
compliments to FDA, American people could go to a Canadian
Internet pharmacy, which was www.rxnorth.com, and they were led
to believe the products were coming directly from London and
that they were safe and it is all legal and it is approved. And
what is happening today is that our Government by way of our
policy are being the enablers of these very complex criminal
enterprises. So why I say enablers is the FDA believes through
their interpretation of the law that they do not have the
authority to destroy these drugs when they see them.
Now if it's a schedule 1 or 2, they do a seizure and they
can destroy, but they can send it to a lab and they can destroy
it. Many of them were never sent to a lab. And I felt that the
absolute frustration by many of the pharmacists at our
international mail facilities working for the FDA that they
will place their stamps, FDA stamps, and things on these drugs,
and they have a return to sender policy. Now you think about
that. You got a flim-flam operation here, a snake oil salesman
selling bad goods to people, and they are taking their money,
and the Government is giving the product back to the flim-flam
man to go somewhere else to scam people. That is what is
happening here.
And the FDA, they want the ability to destroy these drugs,
and we need to give it to them. And what I am referring to here
is with regard to these criminal enterprises the FDA last
summer, they did an FDA bust in cooperation with British
officials at Heathrow Airport. Now these drugs were
manufactured in China. They were shipped transient through Hong
Kong to the United Arab Emirates. They went to Heathrow. From
Heathrow they then go to the Bahamas to a fulfillment center
where that Canadian pharmacy, rxnorth.com, would then contact
the Bahamas, and say, okay, I have an order that has been
placed from somewhere in the United States. They contact the
Bahamas. The Bahamas then fills that order, send it to
Heathrow. From Heathrow then it comes into the United States.
Now the challenge is to actually take down these syndicates
because they are moving transit through so many different
countries. And to give you an example, this is a drug, Fosamax.
This is to improve bone density for those diagnosed with
osteoporosis. Now when you look at these packages, you look at
them here, which one is the counterfeit and which one is real?
Now the only way that you can tell is you got to go to the
manufacturer themselves. And you look here and the yellow is
just a little bit lighter if you look really close. That one is
real. When you turn to the inside on both of them, they both
have the blister packs. All the way to instructions it looks
real. It is not. It is fake.
When you look at the packages and you go to the bar coding,
you can bar code the counterfeit and bar code the real, and
they both bar code correctly. You go to the lot numbers. The
lot numbers are both correct. You go to the expiration dates.
They are both correct. The sophistication of these criminal
syndicates is absolutely extraordinary, and we have to get on
our heels and on our toes and give FDA the authority to destroy
these and protect our country. And that is why I want to work
with everyone and anyone who wants to help protect our system
from these bad actors who prey on the most vulnerable in our
society. I yield back.
Mr. Green. Thank you. And we have about 6 minutes until our
vote. Representative Allen for opening statement.
OPENING STATEMENT OF HON. TOM ALLEN, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF MAINE
Mr. Allen. Thank you very much, Mr. Chairman. Thank you for
convening this hearing to address the important issue of food
and drug import safety. Like many Americans, I have become
increasingly concerned about the safety of our food supply.
Food imports have more than doubled over the past decade, and
the Food and Drug Administration currently lacks the resources
and the authority to protect Americans from tainted products.
For example, the FDA first issued an alert on unsafe seafood
from China as early as 2001, but we all know from watching the
news in June 2007 contaminant levels were still unacceptably
high for many imports, including catfish and shrimp.
The Food and Drug Import Safety Act of 2007 takes several
important steps toward increasing the safety of our food
supply. I want to highlight a few of the provisions I think are
particularly important. First, the legislation would require
that all imported food intended for consumption be subject to
the same safety standards already applied to domestically
produced food. Most Americans would be appalled to realize that
today this is not the case for many food products. Under the
bill, the FDA must certify that foreign countries or facilities
that import food into the United States are enforcing food
safety standards as good or better than the standards in place
here already. I applaud this proactive approach, which has the
potential to identify and address problems in the food supply
before the food ever reaches our borders.
Second, this legislation would institute mandatory country
of original labeling for all foods, drugs, and medical devices
regulated under the FDA. All consumers have a right to know
where their food comes from. I am particularly pleased that for
the first time the rule will apply to processed seafood. These
foods might be at greater risk of contamination because of
extended processing but until now have been exempt from the
country of origin labeling requirement. Finally, the
legislation would help level the playing field for American
producers. For example, fishermen in my home State of Maine are
renowned for safe, sustainable, and high quality seafood
products, yet these hard-working Americans often encounter the
economic hardship because the seafood market is flooded with
cheap, lower quality imports that have not had to meet the same
rigorous safety standards applied to home grown or caught
products.
One possible problem I just wanted to highlight, the bill
would reduce the number of ports open to food imports
dramatically, and this is legislation that I think really needs
some revision. I do thank the chairman again for holding this
hearing on such an important topic and look forward to working
with my colleagues to advance this important legislation. Mr.
Chairman, I yield back.
Mr. Green. Thank you. Since we have votes on the floor the
subcommittee will stand in recess. We finished the opening
statements so we will get to your testimony as soon as we
return hopefully in about 20 minutes.
[Recess]
Mr. Green. The subcommittee is going to come back in order,
and again I appreciate everyone's patience this morning for our
vote schedule. We may have another one in about an hour on the
continuing resolution, so we will try and get through our
statements. Again, I know your time is valuable like everyone
else.
I would like to recognize our first panel. Dr. Lutter is
Deputy Commissioner for Policy, Food and Drug Administration,
and he is accompanied by Dr. Acheson, and also Dr. Solomon. So,
again, proceed with your testimony, and thank you for being
here.
STATEMENT OF RANDALL L. LUTTER, DEPUTY COMMISSIONER, POLICY,
FOOD AND DRUG ADMINISTRATION, ROCKVILLE, MD; ACCOMPANIED BY:
DAVID ACHESON, M.D., ASSISTANT COMMISSIONER, FOOD PROTECTION,
U.S. FOOD AND DRUG ADMINISTRATION, AND STEVEN M. SOLOMON,
D.V.M., DEPUTY DIRECTOR, OFFICE OF REGIONAL OPERATIONS, OFFICE
OF REGULATORY AFFAIRS, U.S. FOOD AND DRUG ADMINISTRATION
Mr. Lutter. Good morning. Thank you, Mr. Chairman, and
members of the subcommittee. I am Dr. Randall Lutter, Deputy
Commissioner for Policy at the Food and Drug Administration in
the U.S. Department of Health and Human Services. I am very
pleased to be here today with my colleagues, Dr. David Acheson,
Assistant Commissioner for Food Protection, and Dr. Steven
Solomon, Deputy Director of the Office of Regional Operations
in FDA's Office of Regulatory Affairs.
Thank you for the opportunity to discuss the important
issues relating to the safety of imported FDA regulated
products. I would also like to take this occasion to thank the
committee for all its recent hard work in passing the Food and
Drug Administration Amendments Act of 2007. The programs that
this legislation reauthorizes are vitally important to the
agency and its continued ability to protect and promote the
public health. We look forward to working to implement this
legislation.
I assure you that FDA is committed to ensuring that
America's supply of food, drugs and other products that we
regulate continues to be as safe as possible. In recent years,
the agency has done a great deal to detect unintentional and
deliberate contamination in imported products. However,
increasing globalization and trends towards production of these
products abroad pose significant challenges. Recent incidents
involving unsafe imported products underscore the need to renew
our focus on integrated product safety strategies.
Food has recently been in the news. Dr. David Acheson,
Assistant Commissioner for Food Protection, provides leadership
on strategic and substantive food safety on food defense
matters for both imported and domestic foods. He is developing
a strategy to enhance our food safety and food defense systems
that will address changes in the global food distribution
system, identify the most critical needs, and serve as a
framework to help us address the challenges we face.
Our goal is to ensure a comprehensive and robust food
safety and food defense program that focuses first on
prevention, second on risk-based interventions to ensure and
verify our preventive controls are effective, third, rapid
responses when contaminated food or feed is detected or when
there is harm to humans or animals. The strategy will provide a
risk-based farm to table approach that coordinates food safety
and food defense efforts on both imported and domestic products
and focuses on prevention, intervention, and response.
The President is engaged directly in the effort to make
sure we are doing everything we can to protect Americans from
unsafe imports. On July 18 he issued an Executive order
creating a Cabinet level working group on import safety to
promote the safety of imported products. It includes
representatives from 12 Federal departments and agencies
including FDA and the U.S. Department of Agriculture, and is
reviewing the procedures, regulations, and practices for
ensuring that imported foods, drugs, and other consumer
products are safe.
Secretary of Health and Human Services Michael O. Leavitt
chairs this working group, and FDA plays a key role in the
group's activities. Secretary Leavitt and FDA Commissioner von
Eschenbach have traveled extensively throughout the United
States during the past few months visiting ports of entry and
reviewing import operations in the field. The insights that
they gained during their review of field operations helped
shape the strategic framework that was released by the working
group on September 10. That report ``Protecting American
Consumers Every Step of the Way: A Strategic Framework for
Continual Improvement in Import Safety,'' outlines an approach
that, like the food protection strategy, is based on the
organizing principles of prevention, intervention, and
response.
The Strategic Framework recognizes that we must find new
ways to protect American consumers and continually improve the
safety of imports. It identifies the need to shift from the
current model that relies on snapshots at the border to
interdict unsafe products. The new prevention focused approach
would identify and target those steps in the import life cycle
where the risks of unsafe products are greatest and verifying
the safety of products at those important phases. Such a risk-
based prevention focus model will help ensure that much more
information about safety and risk is available to border
inspectors and that safety is built into products before they
reach our borders.
Supporting the working group model are six building blocks,
one is to advance a common vision, two, increase accountability
and enforcement, three, focus on risks over the life cycle of
an imported product, four, build interoperable systems among
Federal agencies, five, foster a culture of collaboration, and,
six, promote technological innovation and new science. The
interagency working group on import safety has an aggressive
schedule for public comment and follow up. Next Monday, the
working group will hold a public meeting to identify actions
the public and private sectors can take to promote the safety
of imported products.
By mid-November the working group will present an action
plan to the President. The plan will reflect the public
comments and recommend specific actions that the Federal
Government and stakeholders can take to enhance import safety
at all levels. The action plan will be based on the Strategic
Framework that is already public and will lay out a road map
for short and long-term recommendations.
In addition to these efforts, FDA has recently initiated a
series of meetings with officials in China to negotiate draft
memorandums of agreement aimed at creating a framework to help
assure the safety, quality, and effectiveness of products
exported from China to the United States. The agreements also
aim to increase cooperation and information sharing between the
regulatory bodies of the two nations with the goal of
strengthening China's regulatory process.
Furthermore, FDA is also looking into ways that it can
increase information sharing with other governments that will
assist FDA in better allocating its inspection resources.
Recently, FDA has completed a pilot project with Swissmedic to
facilitate such information sharing.
I would like to comment briefly on H.R. 3610, the Food and
Drug Import Safety Act of 2007, which was introduced by
Chairman Dingell on September 20. It contains a variety of
provisions that relate to the safety of imported food and drugs
in addition to other matters.
The administration has not yet taken a position; however,
we would be pleased to provide technical assistance to
committee and subcommittee staff. We share Chairman Dingell's
interest in enhancing the safety of imported product, and look
forward to continuing to work with him and his staff and others
on the subcommittee and on the committee. We also look forward
to working with you on the action plan that we discussed above.
Ensuring the safety of imported products is a significant
task, and I want to assure you that FDA is diligently working
to efficiently and effectively use the resources and
authorities we have been provided by Congress to help protect
American consumers.
Thank you for the opportunity to discuss FDA's activities
to enhance the safety of imported products. We would be happy
to answer any questions.
[The prepared statement of Mr. Lutter follows:]
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Mr. Green. Thank you, Doctor, and I know you heard in my
opening statement about my concerns with the bill's requirement
that food imports are only allowed to arrive through ports of
entry that have an FDA lab located in the metropolitan areas.
Given the list of the current FDA labs it seems fair to say
that there is no FDA lab presence in not only the No. 1 port
that I represent but also in, in fact, the 10 largest seaports.
There is no FDA lab presence in Houston, Charleston, Hampton
Roads, Savannah or Miami, and also coming from Texas we have
the largest land port in the Port of Laredo. There seems to be
a disconnect that suggests that the locations for FDA labs
determine the basis for the need for their presence in heavy
import areas. Can you explain the decision making for
determining the location of the FDA labs? Was there an intent
to put them near a port of entry?
Mr. Lutter. I am unaware of the history of how the labs
actually ended up where they are currently. As you may know, we
have developed a plan to consolidate labs. That is temporarily
suspended, and we will examine that when the time comes in the
future. Maybe I can ask Dr. Solomon from the Office of
Regulatory Affairs if he knows about the history of how labs
got located where they are.
Dr. Solomon. I don't think there is any relationship
necessary to ports of entry. I think there were locations
throughout the United States to make sure that the domestic
industry was primarily covered, and that was the genesis of
initial thinking on the establishment of labs. Of course, that
has been over many years.
Mr. Green. Do you think it would be reasonable that in that
provision in the bill that if the labs were more geographically
available that that requirement that it only be in a port that
has an FDA lab, you could have inspectors there without
necessarily having the lab. I know you could send samples to
anywhere literally very quickly. I assume that is what happens
now with FDA even though the lab may not be there.
Dr. Solomon. That is correct. With today's ability to ship
products, samples are collected at many different ports of
entry and they are sent to laboratories. There is a lot of
benefit of having large volume laboratories because that
creates good throughput and quality assurances in those
laboratories. That is currently what we do.
Mr. Green. And you could even have mobile laboratories, I
assume, if you had a heavy port. For example, if you didn't
have a lab in Laredo, TX, and if you stand there and watch
those trucks come across from Mexico that are bringing all
sorts of food products then you could easily have a mobile lab
there.
Dr. Solomon. We actually do have two mobile labs. One is a
microbiology mobile lab, one is a chemistry lab, and we do take
those and rotate those around to different ports of entry.
Mr. Green. OK. FDA actually has inspectors at 90 ports of
entry and you do inspections there but you really only have the
13 labs, and so it would be almost unworkable to have it only
at a location where there is a lab.
Dr. Solomon. The numbers you said are correct.
Mr. Green. Dr. Lutter, and other FDA panel, the other
question I had was the bill allows the Secretary to waive the
restriction of food imports and ports of entry located near an
FDA lab. To do so, however, the Secretary must certify that the
import would not increase the probability of adverse health
effects. I can only imagine there would be an influx of waiver
requests to the FDA based on the provision and the fact that
the current FDA lab structure does not cover those ports with
heavy traffic. From the FDA's perspective, are there any
concerns about the workability of the provisions? Does the FDA
currently have the resources to meet the potential high demand
for these waivers much less the inspections?
Mr. Lutter. We haven't yet had an opportunity to examine
that particular provision so I think at this point what we can
say is workability of new requirements and legislation is
always a concern to us, and we will have to get back to you on
the specifics regarding that one point. I would like to
reiterate what Dr. Solomon pointed out a moment ago with
respect to labs. What we are really concerned with is the
capacity overall of facilities within FDA to do laboratory
analysis, and the location is something that is relatively
secondary from our perspective. What we would really like is
the opportunity to do throughput of laboratory analysis
everywhere, and that is the overarching concern that we have
rather than the particular location of the facilities.
Mr. Green. Well, if we are going to expand your
responsibility, we would hope you would both have the staff and
the resources to be able to do that.
Mr. Lutter. Absolutely.
Mr. Green. Thank you. Our ranking member, Congressman Deal.
Mr. Deal. Thank you. Dr. Lutter, your written testimony
does not appear to actually cover the legislation which is the
subject of this hearing. When will the administration be in a
position to send us a written review of the actual legislation?
Mr. Lutter. We are working on it now. We look forward to
offering technical assistance absolutely as soon as possible.
It is probably a matter of some weeks. As I mentioned earlier
in the oral, we are also developing a food protection strategy,
and the President will receive a report in mid November on
import safety, and I think all of that will provide information
that may be of some value to the committee and to the
subcommittee.
Mr. Deal. Could you tell us what agencies might be involved
in legislation such as this, and I understand there is an
interagency task force on imports, and would everyone in that
interagency work group potentially be involved in this kind of
legislation?
Mr. Lutter. Well, the interagency working group on import
safety involves actually a very large number of agencies. Maybe
I could speak--I will let David talk to the actual list. It
does include USDA and USTR, and also the Department of Commerce
and maybe you can add more to that list.
Dr. Acheson. Yes, there are at least a dozen departments
and agencies that are a part of that that cover a whole gamut
of imports so it is related to the trade issues, the customs
and border protection issues, as well as the product safety
issues.
Mr. Lutter. And so, for example, it also includes a
consumer product safety commission which has regulatory
authority over toys which have been mentioned earlier in this
session.
Mr. Deal. The bill before us I think has user fees that
seem to apply by line item, and can you explain to us what a
line item is and how would that impact facilities such as
restaurants that import various items of food, maybe an ethnic
restaurant, for example?
Dr. Solomon. A line item is an entry, a shipment that comes
in of one commodity that is all covered under one customs
tariff code, so if there are products of different commodities
that come in the shipment, they would all come as a different
line entry as they are submitted to the FDA.
Mr. Deal. Would that mean then that an ethnic restaurant
who uses a lot of different line item products would be paying
fees on each of those line item products?
Dr. Solomon. Each different product that would be entered
would come under a different line entry.
Mr. Deal. Does that have the potential of being adversely
punitive to small restaurants as opposed to maybe larger
restaurants who are buying in greater bulks?
Dr. Solomon. Well, certainly as currently structured each
line item that has a separate charge would have different fees
associated with it.
Mr. Deal. Dr. Lutter, in your talk, you talk about risk-
based prevention focus model that would seem very different
from a simple border inspection. Would you describe the model
in greater detail for us?
Mr. Lutter. Yes. Thank you. The vision that many people
have about inspections at the border is essentially an FDA
inspector who is being asked to physically examine a product to
ensure whether or not it meets certain standards for safety;
and of course, this is fundamentally an approach that is
potentially very inefficient and lacks promise of full safety
and effectiveness in ensuring that the products actually meet
appropriate standards. Ideally a risk-based model that we had
envisioned would take into account a full set of information
over the life cycle of the product from when it was first
produced overseas including information about its storage, how
it was produced, what other regulatory agencies may have
thought about that product, including the ones in other
countries such as China or ones in third-party countries such
as the United Kingdom or Canada; and in that sense, the risk-
based approach that we envision would look at a wide variety of
physical characteristics of a product, who produced it, whether
it is vulnerable to certain types of contamination, what we
know about it over the life cycle, and what we know about what
other parties may have thought about what risk may have been
associated with that in determining how we should view it at
the border.
Mr. Deal. Is there indication that other countries who are
trading partners would cooperate in that kind of model?
Mr. Lutter. I mentioned that we have completed a pilot
project with Swissmedic which is a medical products agency in
Switzerland where we've done joint inspections with them to
develop confidence and trust about the results of their
inspections in their facilities and how they might compare with
the result of our inspections. Yes, we're making progress in
that regard.
Mr. Deal. Thank you.
Mr. Green. Congresswoman Eshoo?
Ms. Eshoo. Thank you, Mr. Chairman, and thank you to each
of the witnesses that are here today. I want to address my
questions to Dr. Lutter.
In your testimony you note that each imported food and drug
shipment is ``screened'' meaning that importer has provided
prior notice of the shipment and the notice has been reviewed
to determine the shipment's potential risk. Now, you reported
that FDA reviews more than 33,000 of these notices each day,
but the estimates are that only about 1 percent of the
shipments are physically examined; and I think there's a big
gap here between screened and physically examined. It is also
estimated that fewer than 500 FDA inspectors are covering 300
to 400 points of entry. So with only 1 percent of food shipment
being inspected, how is it that the FDA can demonstrate that
the current ``screening'' and inspection regime is adequate? I
mean, do you really believe that this is adequate?
Mr. Lutter. We think there is a lot of room for
improvement. We are working on a food protection strategy that
will outline steps for that. With respect to the current
process, we acknowledge that the physical inspection is
conducted for a very small percent of the food products coming
in.
Ms. Eshoo. Has the FDA in the last year or 2 years come to
the Congress to say that we see that there are problems and we
need resources, a plan, here is the plan and these are the
resources that we need to address this? I mean, from a consumer
standpoint, it seems to be kind of one scandal after another.
Mr. Lutter. We are developing very actively and very
vigorously a food protection strategy. We expect to be able to
issue that before mid-November.
Ms. Eshoo. When was it begun? Before, during, or after
these major reportings?
Mr. Lutter. Dr. Acheson has had the lead developing it, and
maybe I should let him answer that question.
Ms. Eshoo. I have more questions. I didn't do my opening
statement so that I could ask as many questions as possible.
Maybe we can get to Dr. Acheson to finish this.
Do you believe that there should be more physical
examinations of imports?
Mr. Lutter. I think there should be more physical
examinations of imports, but more importantly than that, I
think that the vision of how to ensure safety of imported
products is not simply a question of increasing physical
examinations at the border.
Ms. Eshoo. Then what else would you do?
Mr. Lutter. It is important to build safety in over the
lifecycle, it is important to ensure that there are processes
and procedures abroad by pushing our borders out to ensure that
the production and the processing of foods overseas is
conducted in a manner to ensure that the products are safe and
comply with FDA standards.
Ms. Eshoo. Do you think that equivalency standards provide
a more cost-effective way to accomplish this to increase food
safety?
Mr. Lutter. I am not sure exactly what you mean by
equivalent to.
Ms. Eshoo. Well, we have equivalency in the legislation
that has been introduced, and it is at the heart I think one of
the drivers of today's hearing. Has the FDA reviewed the bill?
Mr. Lutter. We have looked at the bill. We are not prepared
today as I mentioned to offer any specific comments----
Ms. Eshoo. OK. Fair enough. I would like to get to the
OASIS database. How old is it?
Mr. Lutter. Dr. Solomon, do you want to take that?
Dr. Solomon. It is a database developed in the 1990s. It
has been around for some period of time.
Ms. Eshoo. So maybe about 20 years, do you think? It is the
collection point for shipment notices and other related
information, and it is the tool that the FDA uses I am told to
assess risk, is it not?
Dr. Solomon. It is the point for entry and admissibility
that the data reviews. It is one of the places where we put
risk factors into it. That is correct.
Ms. Eshoo. So it is an important tool for the FDA?
Dr. Solomon. Yes, it is.
Ms. Eshoo. Now, one of our other witnesses today, Mr.
Hubbard, who is a former FDA Associate Commissioner notes in
his testimony that the FDA's information systems are ``old and
out of date.'' In a July 2007 report on food imports from
China, CRS that we pay a lot of attention to, we rely on CRS
for very clear information and facts, they reported and found
it difficult to get certain information from FDA in part
because of technical problems with OASIS. CRS could actually
not even determine the total number of food shipments, nor
could it find a volume of products that were rejected at the
border.
So these are my questions. Do you think today that the
OASIS database is really a robust tool for examining the risk?
Dr. Solomon. We have been looking in replacing that system
with a new system called MARKS. This system integrates various
different databases as you are aware of.
Ms. Eshoo. When is that scheduled to be accomplished and
how much of your budget has been allocated to this change?
Dr. Solomon. We can get back to you with that information.
I don't have that.
Ms. Eshoo. All right. Now, it is because it has technical
problems that you just described what you did?
Dr. Solomon. As we described, it is a system developed many
years ago that has exceeded the capacity of entries, has
exceeded----
Ms. Eshoo. When do you expect the system to be brought up
to date?
Dr. Solomon. I don't have a date for that.
Ms. Eshoo. I think that the committee needs to know that
because you are reliant on this system, and as you have said,
the system is about 20 years old.
Dr. Solomon. We will be sure to supply those answers to
you.
Ms. Eshoo. Good. Thank you very much. Either now or later
in writing, can you tell the subcommittee the volume of
shipments that have been refused entry into our country in the
last 12 months?
Mr. Lutter. We will have to provide that later to you.
Ms. Eshoo. And can you tell the subcommittee the overall
number of food shipments that are coming into the country?
Dr. Acheson. That is on the order of, for 2007, around
about 9 million lines.
Ms. Eshoo. I think we need really accurate numbers on this,
and I am asking the last set of questions because they are
questions that CRS reported that were difficult to find. So I
think it is important for the subcommittee to get it and
information----
Mr. Lutter. We would be happy to provide and answer that.
Just one word of caution about this. Historically, these
numbers have been growing very, very rapidly, more than 10
percent per annum. So one question is simply what period, so we
will give you an estimate of that for the most recent period.
Ms. Eshoo. Well, let me just ask the chairman, the
subcommittee chairman. What time frame? We want to be specific
with the FDA so that we get information that is going to really
help us fill out our case.
Mr. Green. Well, again, The chairman of the full committee
and the sponsor of the bill is here, and I would hope we would
have it as quickly as possible. I would hope we would have it
as quickly as possible because this bill----
Ms. Eshoo. He is saying the period of time, though.
Mr. Lutter. The last 12 months.
Ms. Eshoo. Well, we will let you know.
Mr. Green. Whatever is reasonable, 30, 60 days at the
maximum, probably.
Mr. Lutter. Thank you.
Ms. Eshoo. No, not the period of time in which they have to
respond but the period of time relative to the shipments. How
broad of a lens do we want, a snapshot do we want of this, an
accurate accounting for shipments? The committee staff will get
back to you on that, but we don't want to spend 6 months trying
to get the right numbers. CRS doesn't have it. We need it.
Mr. Green. Yes.
Ms. Eshoo. Thank you very much.
Mr. Green. Thank you. Mr. Murphy.
Mr. Murphy. Thank you, Mr. Chairman. I just want to ask a
couple questions. In my opening statement I raised a number of
issues about the medications, the drugs that come in from other
countries such as China, and I wanted to see what things we can
expect from the FDA on this with regard to medications and
dealing with counterfeit drugs. I know there was some reference
to that. For example, do we see any hope in stemming the tide
for this, are there any increase, decreases, do you see that
some of the other inspections will work on this, do we need to
take other steps? Any of you.
Mr. Lutter. The problem of unapproved foreign drugs coming
into the United States and being available to U.S. consumers
concerns us deeply. These products include not only
counterfeits which are made by people who have concern for
profit but not the health of the people who are consuming the
drugs but also substandard products which contain active
ingredient in levels that are too low or too high or
occasionally not at all, as well as contaminants and bad
labeling. Currently we face a very large volume, even a flood
of such unapproved products at international mail facilities
and courier facilities. This is a problem that we have wrestled
with. Currently our strategy and overall stance has been one of
public communications. We communicate to the public the risks
associated with these products and to dissuade them from using
them by being sure that they understand the risks.
Mr. Murphy. Are you saying here that in this there are some
who are unscrupulous, involved with criminal activity; but are
other ones a matter of companies that do not properly inspect
the materials that are being manufactured over there when it
comes to dealing with medications or are these counterfeits
coming from them?
Mr. Lutter. I think the products come from all different
types of sources as we have reported in the past. We noted, for
example, in intercepts of products coming in from four foreign
countries, India, Costa Rica, Israel, and Vanuatu in the
Pacific. Nearly half of the products coming in from those
countries had documentation indicating that they were in
response to orders placed by Americans on Web sites that
purported to be Canadian in some form. And this is an
inherently misleading practice. Who knows where the products
actually originated from? Almost half, again, of those products
had some documentation indicating that they came from a set of
countries all over the world. I think that set listed 26
countries including Eastern Europe. This is an international
market filled by people who are looking for a quick buck in
trading finished pharmaceutical products that have unknown
origins, unknown handling, and they are intrinsically unsafe--
and consumers shouldn't be buying them. It is somewhat akin to
an unregulated market that in many other respects Americans and
the U.S. Government have rejected as unsafe at least a century
ago.
Mr. Murphy. What do you see is the main way that consumers
are getting these drugs? Are they trying to order them from
what they consider legitimate sources?
Mr. Lutter. They sit at their home computers I believe and
log onto the Web site that might be selling these and then
place orders over the web, and in that sense this is relatively
easy for consumers; and because of that, it is one that we lack
the resources at the borders to stop, so our effort over all
has been to try and persuade people through public health
announcements and advisories that this is an unsafe practice
that they should be very wary of.
Mr. Murphy. All right. I just want to shift gears here and
ask one quick question on food issues about some of the risks
you see for food and what are our greatest concerns for health
and how do you overall see that some of the issues that have
come by lately with regard to food and manufacturing and
contamination, et cetera, that you would be able to deal with
those?
Mr. Lutter. If I may, I would like to ask our food expert,
Dr. Acheson, to answer that.
Dr. Acheson. I would be happy to. I think the risks
associated with food are going to be dependent whether we are
talking about domestic food supply or imported food supply.
Essentially what we consider to be high risk are those foods
where we see repeated problems, where we have seen repeated
outbreaks leading to serious adverse health consequences,
hospitalizations. So obviously a recent example would be leafy
greens where we have seen repeated problems over the last
decade with leafy greens becoming contaminated. When you get to
imported products, similar fresh produce from various parts of
the world as we have seen recently with imports from China or
there can be other foods, too.
Mr. Murphy. Well, I know I am out of time here, but I just
think it is so important for American consumers, who I think
over the last year have developed grave concerns about the
safety of imported foods and even some domestic ones, too. It
is so essential that we take an aggressive role in trying to
address this because it is one that we cannot afford basically
what is more death, more sicknesses, and more problems with our
healthcare system. I know that one of the greatest things that
has contributed to life expectancy in people in this country
has been such things as clean water and clean sewer systems,
better sewer systems. Now, we are dealing with some other
levels here that have to do with the medicines and food that we
have taken for granted for so long that were healthy we
recognize are tainted too; and we cannot take that for granted,
so we look towards all of you being extremely aggressive in
helping hunt down anybody who is bypassing any laws, domestic
or international. Thank you.
Mr. Green. Thank you, Mr. Murphy. The committee will stand
in recess. We have another series of votes, and it will be
hopefully about 20 minutes and we will be back.
[Recess.]
Mr. Pallone [presiding].We will reconvene, and I believe
the last person who asked a question was Mr. Murphy; so I will
move to the chairman, Mr. Dingell.
Mr. Dingell. I again commend you for this excellent
hearing. It is very important to the business of this committee
and, I think, the business of the country.
First I ask unanimous consent that I be permitted to
include a letter or other letters which we are going to be
sending to the Food and Drug Administration with regard to the
subject matter of this hearing today .
Mr. Pallone. So ordered.
Mr. Dingell. And I ask that the record be kept open for
that purpose.
Mr. Pallone. So ordered.
Mr. Dingell. To Mr. Lutter, staff from FDA has informed our
staff that between 2,000 and 3,000 pharmaceutical companies in
foreign countries are registered with the U.S. and are likely
to ship drug products to the United States that should be
subject to surveillance inspections. Is that correct?
Mr. Lutter. It is our understanding that is right, sir.
Mr. Dingell. All right. Now, the next question is, I
understand that FDA has personnel and funds to undertake only
25 inspections due to resource restraints. Is that true?
Mr. Lutter. I would like to refer that to my colleague, Dr.
Solomon.
Mr. Dingell. We were informed by your staff. Is that
correct or not?
Dr. Solomon. FDA conducts several hundred foreign
inspections of drug manufacturers.
Mr. Dingell. We will give you a specific question on this,
but I want to know how many foreign inspections you make a
year. We were told that the number is 25. Please submit that
for the record, and I would like to have it for the last 10
years.
Now, the committee staff has accompanied inspectors to
India. The investigators have come back and told us that
durations of greater than 2 or 3 years make it difficult for
there to be an accurate picture of what is taking place inside
a typical overseas firm. Isn't 3 years a difficult situation to
enable you to know what is taking place in a foreign firm? Yes
or no. My time is limited. Please respond.
Mr. Lutter. It is very difficult to answer yes or no, sir.
I think longer periods are more problematic than shorter
periods, yes.
Mr. Dingell. Under the law you are supposed to investigate
American firms every 2 years, isn't that correct?
Mr. Lutter. Yes.
Mr. Dingell. All right. But can you investigate these
foreign firms every 2 years?
Mr. Lutter. We are not able to do so now, sir.
Mr. Dingell. Now, I come down that 2,000 or 3,000 firms
being able to investigate 20 a year gives you 100 years to get
the firms all investigated, is that correct, just using the
arithmetic?
Mr. Lutter. The arithmetic is correct, sir.
Mr. Dingell. The arithmetic is correct? I would like to
know how often you can get around to investigate these foreign
firms which are exporting drug products into the United States.
Now, isn't it true that we have firms importing drug products
to the United States that have not been investigated in 8, 10,
or more years or never? Is that true?
Mr. Lutter. That is correct.
Mr. Dingell. So we are attempting to investigate and
inspect domestic firms every 2 years in a well-regulated
environment but we are having terrible times providing the
necessary investigation and inspections of firms which do not
have either a good regulatory law or which do not have proper
investigation of their products as they are entering into the
United States, is that a true statement?
Mr. Lutter. That is correct, sir.
Mr. Dingell. All right. You have mentioned in your
testimony that FDA currently reviews approximately 33,400 prior
notice submissions per business date. How many FDA staff review
these prior notice submissions? Can you tell us now or do you
wish to submit that for the record?
Mr. Lutter. Put it in the record, please.
Mr. Dingell. All right. How many prior notice submissions
are received on weekends? Would you submit that for the record?
How many staff would review these submissions? You say that FDA
performs routine surveillance inspections. Can you tell us the
frequency of these routine surveillance inspections?
Mr. Lutter. We will have to put that in the record, sir.
Mr. Dingell. All right, if you please. Now, you stated in
your testimony that the FDA has the authority to commission
other Federal officers and employees to conduct examinations
and investigations. You note that FDA has commissioned over
9,900 customs and border patrol officers. When CBP officers are
commissioned, do they work solely on FDA examinations and
investigations or do they work on other matters?
Mr. Lutter. It is our understanding they work on other
matters as well.
Mr. Dingell. All right. How easy is it for CBP officers to
be pulled off their FDA duties?
Mr. Lutter. We would have to get back to you on that, sir.
Mr. Dingell. All right. Now, I am interested, how many
ports are approved for admission of foreign manufactured
pharmaceuticals? Please submit that for the record.
Mr. Lutter. We do not approve ports, sir, so any port of
entry would be permissible.
Mr. Dingell. What percentages of your imports of
pharmaceuticals are examined by FDA inspectors? Do you have any
idea?
Mr. Lutter. We would have to get back to you on that, sir.
Mr. Dingell. All right, if you will submit that for the
record. How many food shipments or what percentage of your food
shipments are investigated by FDA investigators?
Mr. Lutter. Physically inspected?
Mr. Dingell. Physically inspected, yes. Please submit that
for the record. We will have a letter on this particular point.
Now, inform me how many inspections you make of devices and
appliances that are regulated under your jurisdiction, that are
imported from abroad?
Mr. Lutter. Inspections of the shipments coming in or of
the----
Mr. Dingell. Yes, coming in.
Mr. Lutter. We will get that to you on the record.
Mr. Dingell. All right. First of all, American
manufacturers are required to comply with the law by observing
best manufacturing practices. Do you apply the requirements for
best manufacturing practices to be performed by foreign
companies which export pharmaceuticals to the United States?
Mr. Lutter. The requirements----
Mr. Dingell. Yes or no.
Mr. Lutter. The requirements for good manufacturing
practices apply independent of location, so yes, facilities
abroad that we inspect and that are approved for the----
Mr. Dingell. So the answer is you really don't do that, is
it? And you really don't have any inspectors to do that, do
you?
Mr. Lutter. That is correct.
Mr. Dingell. For example, how many inspections have you
done in China to make sure that good manufacturing practices
are carried forward by Chinese manufacturers that export to the
United States?
Mr. Lutter. We do not now have inspectors permanently
located in China.
Mr. Dingell. How many inspectors do you have over there
looking at this question?
Mr. Lutter. We don't have any right now that are
permanently located in China, sir.
Mr. Dingell. Now, please inform me, how many will you have
under your next budgetary request?
Mr. Lutter. We will have to get back to you on that, sir.
Mr. Dingell. You will submit that for the record?
Mr. Lutter. Yes, sir.
Mr. Dingell. Now, please inform me, what happens to
prescription pharmaceuticals that you find that are unsafe at
the point of entry and what happens to foods that you find to
be unsafe at the point of entry? What happens to them? They are
rejected, they go back out of the country, is that right? Yes
or no.
Mr. Lutter. Foods are refused, yes, sir, and the drugs are
also refused.
Mr. Dingell. They go back out of the country?
Mr. Lutter. Yes.
Mr. Dingell. Is that true in all cases or sometimes you let
them go through?
Dr. Solomon. If the product can be made in compliance, then
that can be considered.
Mr. Dingell. If it can be made in compliance? I wanted to
ask you some questions on it because my time is expiring. Now,
I want you to please tell me what percentages of those
commodities that are rejected at the point of entry can you
assure us are not coming in at another point of entry?
Mr. Lutter. we will have to submit that to the record, sir.
Mr. Dingell. All right. I want you to give me that. Now, I
want you to tell me, and I will ask you to submit this to the
record, how you are going to substitute for the laboratories
which you had proposed to close under the earlier rulings and
orders of your agency and the Office of Management and Budget?
I want you to submit that for the record if you would please.
We will have you a letter on this.
Mr. Chairman, I ask unanimous consent that the record
remain open so that we can get this because this will tend to
show us that the Food and Drug which says it is being leaner
and meaner is just being leaner and weaker and is not capable
of carrying out its important duty of protecting the American
public, and I intend to try and get you folks, whether you like
it or not, the resources and the authorities to do the things
that you have to do to protect the American people.
Mr. Chairman, I thank you for your courtesy.
Mr. Pallone. Thank you, Mr. Chairman. Mrs. Wilson.
Mrs. Wilson. Thank you, Mr. Chairman. The chairman of the
full committee asked a number of questions that were very
interesting and some of the answers I know you will have to get
for the record, but did you want to elaborate on any response
that you were not allowed or not able to make in the last round
of questions?
Mr. Lutter. No, thank you.
Mrs. Wilson. Fair enough. I just wanted to give you that
opportunity. You mentioned in your testimony risk-based
methods, and particularly the Bioterrorism Act that includes
provisions that push the FDA in this direction. Could you talk
a little bit more about risk-based methods for ensuring
security, how that works and how it is working, how this is
being implemented?
Mr. Lutter. Let me turn to my colleague, Dr. Acheson, to
address that.
Dr. Acheson. Sure, would be happy to. In relation to
imports, is that what you are asking about?
Mrs. Wilson. Yes.
Dr. Acheson. OK. Essentially that has got multiple
components. The machinery that makes it work is the prior
notice center, but the prior notice center is primed with
information derived from vulnerability assessments that have
been done internally within FDA, and essentially what those
vulnerability assessments are doing is asking the question,
which foods are most likely to be contaminated with an agent
that could cause maximum harm. So it has essentially been
ranked based on the type of food and the type of agent that you
might have concern. That information is fed into the prior
notice center, and it is then combined with other intelligence
information and law enforcement information and customs and
border protection information to screen entries. So every time
a line of food arrives in the United States, prior notice has
to be submitted. The time up front varies with whether it is an
air or truck or ship. That is reviewed electronically, and if
it is a food that is of higher concern or origin is of higher
concern or something to do with the importer or the person
receiving the goods kicks a message out through studying the
classified law enforcement systems, that will flag that product
for specific action which is usually in the form of an
inspection and/or sampling.
Mrs. Wilson. Are you developing new tools in this prior
notice center or new things to enhance the ability to screen
based on risk?
Dr. Acheson. Prior notice center as I have described is
entirely focused on deliberate attacks on the food supply. It
is a food defense, bioterrorism tool. We work internally within
the agency to change those parameters as necessary based on
identification of new risks. As we move toward integrating food
safety and food defense into an overall food protection
strategy, those concepts of how do you define risk based on a
variety of parameters need to be built into that. We are not
completely there yet, but the food protection strategy that we
are developing currently will address those broader issues.
Mrs. Wilson. Let me ask if you would elaborate a little bit
about the food safety strategy you have under development, both
the timing of it and who is involved, what are the issues you
are addressing, what are the major thrusts of this new
strategy?
Dr. Acheson. The strategy was started in the beginning of
May when the Commissioner created the position that I fill. It
is a strategy that is focused on food and feed, domestic and
imported products, and it is focusing on the full product life
cycle. In the context of domestic, that takes you right back to
the process of where the food is coming from and likewise for
imports. It will be a risk-focused, a risk-based strategy
because what we need to do is to look at those risks to find
where the resources need to go. The other very important part
of this is a major shift toward prevention. The agency has
heavily focused on interventions through inspections and
reacting to situations. What we need to do is get ahead of that
curve and focus on preventative strategies, and that is a huge
part of what the plan is going to look like.
Mrs. Wilson. In this effort to develop a food safety
strategy to shift toward prevention and look systemically at
this whole problem, have you involved private industry in these
efforts, particularly for their input whether it be grocers or
restaurants or food processors in thinking about these
strategies and what they bring to the table?
Dr. Acheson. That is part of the strategy, to involve them.
What we want to do is to basically--
Mrs. Wilson. But are they being involved in the development
of the strategy or just in its implementation?
Dr. Acheson. They will be involved in implementing it and
helping us figure out how to implement it. The strategy
essentially is laying out the broad directions of prevention,
intervention, and response. One of the very first deliverables
in the strategy is going to be to have dialogs with various
stakeholders, consumers, industry, State partners, on how to
implement it and how to adjust it so that it is going to fit.
But we want to roll out with something for people to respond
to.
Mrs. Wilson. In your working group, and this is my final
question, Mr. Chairman, and I appreciate the latitude, to
develop this food safety strategy, are you involving experts in
other elements of government who have worked on other safety
and security kinds of strategies or is this mostly FDA?
Dr. Acheson. At this stage it is an internal FDA strategy,
and it is more than food safety. It is food safety and defense,
so it is a food protection strategy that integrates, too. We
are starting internally, but we anticipate that we are going to
work with other stakeholders as it rolls out.
Mrs. Wilson. I would encourage you to do so, particularly
we have National Laboratories whose expertise is systemic
approach is to security and defense whose experience in other
realms may be helpful to you.
Dr. Acheson. I appreciate that. There is no question, we
will.
Mrs. Wilson. Thank you, Mr. Chairman.
Mr. Pallone. Thank you. I am going to recognize myself for
questions. I wanted to ask Dr. Acheson if I could. I am just
reading from a publication that said that you testified
yesterday I guess before the House Agriculture Appropriations
Subcommittee that the agency needs more powers to police the
Nation's food supply, and I guess there wasn't a time for the
chairman of the subcommittee to ask what new authorities the
agency might seek. So I would simply ask that. What kind of
authorities, Mr. Acheson, would you seek? Are these in the
Dingell bill by reference or would they be something beyond the
Dingell bill, if you would?
Dr. Acheson. There is currently a very active dialog going
on within FDA and HHS to address exactly what new authorities
we would seek as part of this plan. So at this point, it is not
fully defined, but there are a number of areas that are under
consideration.
Mr. Pallone. You want to comment on some of them at all or
just give us some idea?
Dr. Acheson. At this stage, I am not able to really say
much beyond what I just articulated.
Mr. Pallone. All right. Well, I would ask you if you could
get back to us in writing and give us some indication.
Dr. Acheson. Absolutely, and I would hope in the future as
the plan starts to take shape, that we could work jointly
between what we are developing and what the subcommittee is
developing so that we have a holistic view of this that is
fully integrated, building the best of all these ideas.
Mr. Pallone. Absolutely. Then I want to go back to Dr.
Lutter. Everyone knows that part of the problem with the food
safety system is the lack of resource that the FDA has
available to perform its responsibility. It is a recurring
theme. I have heard it for years. Can you talk about the
financial resources that the FDA has to perform its safety
responsibility and has that budget increased or how has that
budget increased if any? I will ask you some more specific
things, but just in general?
Mr. Lutter. I would prefer to pass that question onto my
colleague.
Mr. Pallone. Sure.
Dr. Acheson. Yes, in recent history while there have been
increases in the budget on the food side, they have largely
been used to keep pace with inflation and pay increases, and
there have not been substantive increases in programmatic
support.
Mr. Pallone. And do you have a specific percentage each
year over the past 5 years, or you just say just to keep up
with inflation essentially?
Dr. Acheson. I would have to get back to you with specific
numbers. I don't have it with me.
Mr. Pallone. All right. I would appreciate it if you would,
but basically you said what keeps up with inflation and that is
it. Well, do you think that an importation fee like what Mr.
Dingell was proposing is a good way to fill in the gaps and the
lack of resources?
Dr. Acheson. User fees are a double-edged sword. I think
that there can be potential advantages to them. Clearly as you
have articulated as have many of your colleagues in order to
make a new system work that is going to be radically different,
you have go to adequately resource it. So those resources have
to come from somewhere. User fees are a potential source of
revenue to do that, but one has to be very circumspect about
whether you can implement them in a meaningful way that is fair
that is actually going to get you where you want to go. It is
an option.
Mr. Pallone. But clearly you do think that your resources
are inadequate? You agree, we need more resources, right? I
didn't ask that question because I thought it was obvious.
Dr. Acheson. It is obvious.
Mr. Pallone. OK. Then I wanted to go back to Dr. Lutter
unless you want to pass it over to him again. Let me say this.
Mr. Dingell's bill directs funds specifically to strengthen
imports, the system to regulate and inspect imports. But some
of the recent contaminations, and I mentioned in my opening
statement, have involved domestic products, not imports.
Considering the current funding levels and the fact that very
little money is targeted for imports regulation, how do you
perceive strengthening inspection of national products while
simultaneously managing the new import regulations? In other
words, if we were to spend more money on imports, how are we
going to strengthen inspection of domestic products given the
fact that we don't have a lot more money available so far?
Mr. Lutter. The food protection strategy that we are
developing would be holistic and integrated in the sense it
addresses both imported foods and domestic foods, as well as
risk from deliberate contamination and accidental contamination
and over the life cycle. So in that sense the approach would be
intended to encompass both domestic foods, and we have
acknowledged that there are risks that are worthy of concern
and additional action particularly with respect to leafy greens
which the recent outbreaks have been domestic. So yes, we share
concerns about that.
Mr. Pallone. OK. All right. Thank you. I recognize Mr.
Buyer from Indiana.
Mr. Buyer. Sure. I have no problem if you have further
questions. You are on a roll. OK. Dr. Solomon, as Deputy
Director for the Office of Regulatory Affairs, is it fair to
say that you would have a good understanding of FDA's work at
the international mail facilities?
Dr. Solomon. It is not my area of expertise, but I am
heavily involved in import operations and familiar with
processes and procedures at many of our import facilities.
Mr. Buyer. At these mail facilities and the private ports
of entry, Customs will identify a particular package. Both of
you, as I understand, have target search systems, am I correct?
Dr. Solomon. That is correct.
Mr. Buyer. So it is easier when you have a manifest as it
is going through the private systems, FedEx, UPS, et cetera.
When they have a manifest, you can examine it by your target
systems, and so you kind of know what you are looking for,
right?
Dr. Solomon. We have more information going through those
systems, correct.
Mr. Buyer. Right. So as the packages are coming down the
conveyor belt, it has been identified. So now you have a
targeting system, there is an overlap, Customs has a targeting
system, and the handler also has their own targeting system. So
into the FDA bin get kicked a lot of packages, isn't that
correct?
Dr. Solomon. That is correct.
Mr. Buyer. Is it fair to say that around 5 percent of those
packages are inspected?
Dr. Solomon. Yes, sir.
Mr. Buyer. And these packages that go into the FDA bin at
FedEx and UPS, the FDA, you don't work at night while others
work, i.e. other Federal agencies and obviously the shippers.
You work during the day to put the input with the data to
identify from the manifest what packages you want sent to your
bin, is that correct?
Dr. Solomon. Yes, products can be placed on hold and then
examined the next day.
Mr. Buyer. Right. So then you come in the next day to
examine. So 95 percent of these shipments, though, just gets
kicked right back into the system?
Dr. Solomon. A large percentage of the products are not
examined.
Mr. Buyer. OK. Now, of the packages that the FDA examines
so a pharmacist can actually look at them, not all of these
packages are forwarded to a laboratory, is that correct?
Dr. Solomon. That is correct. Only a percentage of them
need further laboratory exam.
Mr. Buyer. OK. So when Customs will look at a package and
prima facie, on its face, they can identify this is
counterfeit, I know it is counterfeit, they destroy it. If they
are not particularly sure, they also kick it over to the FDA.
So now FDA, your investigators or inspectors look at this and
you have got the pharmacist on site; and he looks at this and
goes, no, we are not going to let this come into the country.
Do you put some type of a sticker on it, don't you?
Dr. Solomon. The product is marked and set aside and then
it is going to be detained.
Mr. Buyer. How is the product marked?
Dr. Solomon. I am not familiar with the exact mark on that.
Mr. Buyer. At two of the ports of entry that I went to in
Chicago and at JFK, the pharmacist on site said that they keep
seeing their own marks on counterfeits coming back to the
system. Would that be accurate?
Dr. Solomon. That is possible.
Mr. Buyer. So earlier from my statement that the Federal
Government, we are becoming an enabler to a criminal enterprise
because people get the Internet, they think that, from that
Canadian Web site, that it is OK because it says it is OK.
These are legal, lawful drugs. It is OK. And when the criminal
enterprise, the counterfeiters then send that product into the
United States, they take the person's money from the credit
card, then we, the Federal Government, by virtue of your policy
or an interpretation of the law then, return to sender. That is
what we do, is that correct? We take that product and return it
to sender?
Dr. Solomon. That is for the most common products. Some
products that are clearly of concern are not sent back to the
sender.
Mr. Buyer. Excluding your schedules 1 and 2, right? Those
would be destroyed. If in fact the package does not have a
formal entry, a commercial formal entry in the amount of 2,500
or more, you can give your notice, and if they don't, within 30
days, respond it can be destroyed?
Dr. Solomon. That is correct.
Mr. Buyer. So I understand there are exceptions to that,
but in general, most of these small packages either get through
the system or if your inspectors are able to identify them,
then they are returned to sender, correct?
Dr. Solomon. That is the most common procedure.
Mr. Buyer. Most common procedure? Now, as a policy
standpoint from the FDA, do you think that is good policy to
give back to the criminal enterprises their products so they
can continue to send them back and prey upon people, whether it
is our own country, hemisphere, or other countries and
hemispheres around the world?
Dr. Solomon. I will let Dr. Lutter from the policy
perspective----
Mr. Lutter. We are concerned about the continued
circulation of counterfeit and substandard products that might
be sent overseas to the sender and then might be reintroduced
again into the United States. These products, if they were
unsafe the first time, they are surely unsafe the second time.
Mr. Buyer. So if this committee puts into the law giving
the authority to the FDA to destroy, stop this return-to-
sender-policy, you would support that?
Mr. Lutter. It is something we would look at very seriously
to the extent that it mitigates this public health concern of
ours. I think there are a couple of questions pertaining to
destruction methods and the destruction costs and also whether
or not the adequacy of due process before destroying goods. To
the extent that it protects public health, we would look at it
very seriously.
Mr. Buyer. Well, with regard to costs on destruction, Mr.
Chairman, I think the FDA should be able to tell us, if we are
going to protect the American system and America's health and
ensure high standards, cost shouldn't be the problem here; and
if in fact, you think that is a barrier to this, please let us
know what you estimate the cost to be able to destroy is and
how to handle that because Customs is doing that right now. And
in your testimony, Mr. Chairman, they say that they anticipate
these imports to triple by 2015. If in fact that is true, we
have got to get off our heels and on our toes. So I want to
work with you. When I mentioned in the opening that as soon as
this gets from Legislative Counsel, we will get it to the
chairman and Chairman Dingell and to the ranking members. I
will also ship this down to you, and we want your comment. I
know you agree with some of these areas, whether it is
serialization or the pedigree issues, let us work through
these. As I said earlier, this is an issue that Congress
doesn't touch very often. 1938, 1988, and now. So I appreciate
the chairman's indulgence, and I look forward to working with
everyone.
Mr. Lutter. Thank you. Likewise.
Mr. Pallone. Thank you. Ms. DeGette.
Ms. DeGette. Thank you, Mr. Chairman. Dr. Solomon, I was
curious to hear your answer in response to Mr. Green's concerns
about FDA lapses at ports. We don't have very many ports in my
district, but what we do have is an FDA lab; and I thought I
heard you say that there is a great benefit in having many
labs. Is that correct?
Dr. Solomon. No, I think what I was alluding to is the
benefit of laboratories, as Dr. Lutter explained before is the
lab capacity to get a lot of throughput through those labs to
ensure the quality of those products and labs. Lab capacity is
the most critical issue versus the----
Ms. DeGette. OK. So you didn't intend, if you did say there
is a great benefit in having many labs, because you are aware,
aren't you, that the FDA has a proposal out to reduce the
number of labs from 13 to seven.
Dr. Solomon. We are aware of that and as discussed earlier,
that is in abeyance.
Ms. DeGette. Dr. Lutter, I also heard you say that, and I
know it is in abeyance, that what you are really looking at
with these labs is the ability to do analysis and the location
is really secondary, correct?
Mr. Lutter. One of our concerns is to be able to do the
most possible analysis of suspect products given the resources
we have.
Ms. DeGette. And for example, in the Denver lab, you have
people who have been doing some of these very specialized food
analyses for 23, 25 years, is that correct?
Mr. Lutter. I am told that is the case.
Ms. DeGette. And these are also people, and I will just
tell you in case no one has, I have talked to them personally
and I don't blame them. Anybody who lives in Denver, CO, and
has for 25 or 30 years doesn't want to move to a centralized
lab. So those people will all quit. So my question is I know
that you have temporarily suspended the reorganization. Mr.
Dingell's bill would do it permanently, and I am wondering if
the administration would be ready to drop the plans to close
these laboratories and just go along with our committee
proposal at this time?
Mr. Lutter. We are committed to ensuring that the products
that we have----
Ms. DeGette. OK. I don't need that kind of answer because I
have only got 5 minutes. Yes or no, are you willing to drop
this proposal at this time?
Mr. Lutter. No.
Ms. DeGette. You are not? OK. In that case, previously I
asked the FDA witness at other hearings to provide with an
analysis justifying the closure of the food safety labs. Is the
FDA prepared to do that, either a cost benefit analysis or a
quality control analysis or any other kind of analysis? Can we
get that from you?
Mr. Lutter. I think we are working on one and will have to
get back to you on----
Ms. DeGette. When will I be able to receive that analysis?
Mr. Lutter. I will have to look into it and get back to
you.
Ms. DeGette. OK. When will you get back to me about when
you can get back to me about the analysis?
Mr. Lutter. Later this week.
Ms. DeGette. Thank you. I will look forward by October 1 to
having that timeline from you. The reason I am a little
frustrated, I have been having difficulty getting requests from
the FDA and other agencies, so I appreciate your comity in this
area. One of our witnesses today is going to testify that the
FDA only inspects 1 percent of imported food. Is this accurate?
Mr. Lutter. With respect to physical inspections, yes.
Ms. DeGette. OK. Do you think that is adequate?
Mr. Lutter. I think the key message is not the physical
inspections but the information available to us to identify
which products are really risky.
Ms. DeGette. OK. So given the available information to you,
do you think that 1 percent of actual, physical inspection is
sufficient----
Mr. Lutter. No.
Ms. DeGette. OK. So if we gave you more resources you would
like to be able to actually, physically inspect more food?
Mr. Lutter. We would endeavor to inspect more food, but
that is only part of the solution.
Ms. DeGette. Absolutely.
Mr. Lutter. The real part is to put together a system that
ensures the products are safe when they arrive at our borders.
Ms. DeGette. I agree that physical inspection can't be the
only thing, and I think that is right. Does the administration
have any idea what percentage of actual, physical inspection
would be beneficial or is that part of the whole plan that Dr.
Acheson and others were talking about the quality control?
Mr. Lutter. It is really the latter. What we are really
looking at is a transformational strategy that will use much
more information to ensure that the inspections at the border
are well-targeted, are efficient in figuring out which products
are safe, but also to ensure that the products themselves are
safe when they arrive at the border.
Ms. DeGette. Absolutely.
Mr. Lutter. And so it is not only the physical inspections
that we should be focusing on.
Ms. DeGette. Right. I agree with that. And so my question,
I was very pleased to hear your response to one of the other
members when they said would it be fair to say you don't have
adequate resources and you said yes. Does the administration
have any idea how many additional resources it would take so
that you could adequately perform these duties, and does the
FDA support the user fees that are included in the bill?
Mr. Lutter. With respect to the user fees in particular,
the question that we would have in examining the proposal more
closely is the extent to which they are adequate to perform the
services they were expected to do as part of the bill, and we
will have to get back to you on that. We look forward to
offering technical assistance to the committee on that key
question.
Ms. DeGette. And do you have any idea how many additional
resources you are going to need to perform your job in the way
you would like to?
Mr. Lutter. I think that information also will have to come
later as part of the food protection----
Ms. DeGette. OK. So for those two things, does the FDA have
some idea when it will have the answers to those questions?
Mr. Lutter. We expect to go public with this by mid-
November.
Ms. DeGette. Mid-November? OK. Thank you very much, Dr.
Lutter.
Mr. Pallone. Mr. Waxman.
Mr. Waxman. Thank you very much, Mr. Chairman. I know that
Secretary Leavitt is working on a proposal, and I am pleased
that he is because I understand he is taking personal charge of
the matter; and we should be working closely with the
administration because we all want the same goals. I think we
can all agree that the concept behind the provisions of this
bill make good sense. We want to have every confidence that the
foods we import are from countries and from facilities that
have systems in place to ensure those foods are safe, and who
better to give us that confidence than FDA. So before imported
foods would be permitted to enter the U.S., the bill would
require FDA to certify that those foods come from a country
that has in effect food safety standards at least as protective
as ours. FDA would have also to certify that the country is
monitoring for compliance with those standards in taking
appropriate enforcement actions when that compliance is
lacking. If FDA is unable to make that certification as to the
entire country, the bill would give FDA the option to certify
each company on a facility-by-facility basis and I agree with
this concept. But I want to be sure we are giving the FDA the
appropriate authorities and resources so that this is a job
they can handle. If you don't think the agency will be able to
do this job, I would hope you would give us specific
suggestions about how to make it work. That responsibility lies
with the agency. So I think we need to get an understanding
here on the size and scope of the job we're asking the agency
to do.
Let us just look at China for an example. Obviously given
the many recent incidents of unsafe imported Chinese foods, it
seems unlikely that FDA would be prepared to certify the
country as a whole anytime soon. Would you agree with that, Dr.
Lutter?
Mr. Lutter. Dr. Acheson recently returned from China, and I
would like to have him----
Mr. Waxman. Are we ready to certify that China has in place
a system as reliable as the one we have here in the United
States?
Dr. Acheson. Not yet.
Mr. Waxman. If FDA could not certify the country as a
whole, FDA would be faced with the prospect of certifying each
of the Chinese facilities seeking to export their foods to the
U.S. before those foods would be permitted to enter the
country. Could you give us the sense of the scope of
accomplishing that task. For example, can you give me any
estimate of how many Chinese facilities there are currently
exporting foods or food ingredients to the United States, and
what kind of resources would FDA need to be able to inspect
each and every one of these firms? Dr. Acheson, do you have an
idea of that?
Dr. Acheson. Yes, based on the information provided on
recent visits to China, there are about 400,000 food or feed
manufacturers in China of various sizes. Currently about 12,000
to 15,000 of those are registered with AQSIQ who is the import/
export authority in China. According to their law, they have to
be registered in order to be a certified export. One of the
problems is that foods are being exported from China that are
not certified, and according to Chinese law they are
essentially illegal exports. And at least a third of the
exported food apparently is falling into that category.
Mr. Waxman. One would think if foods are being exported
inconsistently with the law of China that even if we look to
China to have in place a system like an FDA to inspect and
review all the safety issues, there would probably be a lot of
products that would go under that law, too, wouldn't it?
Dr. Acheson. Well, to get to your point, if this is going
to work, we have to ensure that it is meeting our standards.
And you asked about resources. I think we would have to examine
that, how many firms we are talking about, but it would be
significant to ensure that number of firms were in compliance.
Mr. Waxman. Well, we are going to look forward to your
recommendations, and I assume this is going to be part of the
administration proposal because this is a huge undertaking if
we work along this theory of making sure the country has in
place a system, that they are enforcing it, and if they don't,
we go facility by facility. Of course, China is only one of the
countries that we are dealing with.
Dr. Acheson. Right.
Mr. Waxman. FDA currently inspects only 1 percent of all
imported food. This is quite a grim figure, but it is also true
of the domestic food supply. Dr. Acheson, there has been a
serious problem with leafy greens in the United States. There
have been 20 outbreaks related to fresh produce alone in the
past 12 years, and the number of food safety staff has fallen
significantly in recent years; and funding for domestic food
safety investigations has been dramatically reduced over the
past 5 years. While we obviously have got serious problems on
our hands because Americans are looking to FDA to restore their
confidence in the safety of their food, has FDA formulated some
ideas about how and what it needs to do to remedy this
situation? We need to know how many more inspectors the FDA
would need, whether your information technology infrastructure
is adequate to effectively and efficiently monitor the life
cycle of products as you indicated is necessary, what new
authorities you need to deal with other countries as well as
domestic firms to know that adequate safety procedures are in
place. So I guess what I want to ask your personal assurances
that you are going to work with Secretary Leavitt to give FDA's
full and candid assessment of the needs of the agency in this
area, and we need this assessment now. We can't wait for the
next outbreak.
Dr. Acheson. We are already working with the Secretary and
others in HHS and FDA, and this essentially is what the food
protection plan strategy that we are currently working on is
all about, is to examine the changes that we are facing in 2007
that evolved over the last 10 years or so and put a plan in
place that is going to begin to move forward. But I want to
emphasize, this is not an overnight fix. We need to build a
solid foundation of a plan adequately resourced and be looking
for in the medium term to put this back on track. It is not
something you can just throw money at, flick a switch, and the
problem is solved.
Mr. Waxman. Thank you very much. Thank you, Mr. Chairman.
Mr. Pallone. Thank you, Mr. Waxman. It is not my intent to
have a second round of questions because I want to move to the
second panel, but Mr. Buyer said that he wanted to ask a
question; so I will recognize him.
Mr. Buyer. I appreciate the gentleman's indulgence. This is
a very complex and serious issue, so I appreciate the
gentleman. On page 6 of your testimony, sir, you go into great
detail how FDA, in order to comply with regard to imported
drugs, your biologics, certain devices for pre-market approval
with regard to authenticity to ensure that they comply with
U.S. labeling requirements, et cetera. So earlier when I held
up these two drugs, the Fosamax, and when you look at it, my
gosh, it complies with everything. So what I look here is you
are working very hard with regard to the authenticity, and
these counterfeiters are getting better and better and better
with regard to packaging and labeling. And obviously we have a
great challenge ahead of us. So with regard to the proposed
legislation that I am going to send to you, one of the things
that I hate doing is studies. I don't want to create a
commission, but I think there is one thing that we are going to
have to really look at and that is whether to have FDA, in
cooperation with our manufacturers, create a database that
interfaces with your targeting system. And what I mean by that
is if I am a manufacturer, I now disclose to you--you already
know where their manufacturing facilities are but not only
these are our manufacturing all around the world, but here are
our approved wholesalers. Pick a company. This is who we work
with. So if you are getting a particular product, so here is
the legitimate product; and this runs through a legitimate
wholesaler in Germany, and someone in Germany has purchased
that product, they are sending it to a relative who is only
visiting on a legal visa to the United States, you let that
come through. But if your targeting system knows that this is
coming from Singapore and I have no wholesalers licensed in
Singapore, there ought to be some kind of alert system out
there. So the more we get sophisticated and these computer
systems are enablers for us, I think we have an opportunity
here to zero in on the authenticity because right now, I just
wanted to let you know, you can work very hard to comply with
the law and do everything, but the counterfeiters seem and
appear to be one step ahead of us. Do you have a comment with
regard to any of these ideas?
Mr. Lutter. We share very much your concerns about the
threats to public health posed by counterfeit products, and the
point that you are making about the inability to distinguish
the counterfeit from the genuine product is one that I have
actually made in this room on past occasions, and we agree very
much with that. We have trained pharmacists and physicians who,
confronted with the counterfeit, can't distinguish one from the
genuine product. With respect to the opportunity to develop an
electronic database that might facilitate the identification
and the authentication of genuine products and permit the
distinction of those from counterfeits, that is something we
have explored repeatedly in the past in the context of a
counterfeit task force. It was organized at FDA and has issued
a series of reports. It is unclear who should own such a
database or who should manage it. There are a variety of views
on that, but the idea that electronic pedigrees and electronic
track and trace technology would allow for a low-cost way of
authentication so as to reduce the risk of counterfeits is
something that we pointed toward, advocated in the past, and we
think that is an appropriate way to implement mandates of past
legislation and also the regulation on pedigrees that we have
adopted. We think there are a lot of opportunities there, and
we look forward to offering technical assistance to you.
Mr. Buyer. That is excellent, Mr. Chairman. That is going
to put us here on the Hill on common ground with the
administration with regard to this legislation. The last thing
I would say is please recognize your front-line personnel for
FDA. Your inspectors and your pharmacists, they are very
challenged and frustrated; and they want the ability to destroy
when they find these counterfeit drugs, rather than a return-
to-sender policy. With that I yield back, and I thank the
gentleman.
Mr. Pallone. Thank you. I want to thank all of the panel
and obviously we have got a lot of work ahead of us; and please
get back to us with a lot of these questions that have been
asked as quickly as possible.
Mr. Lutter. Thank you very much for the opportunity to
present our views, Mr. Chairman. Thank you.
Mr. Pallone. Thank you. And I will ask the second panel to
come forward if you can. Thank you all for being here, and let
me introduce everybody from my left to right.
First we have Mr. William Hubbard who is senior advisor,
Coalition for a Stronger FDA, and then we have my former
colleague, Congressman Cal Dooley. I am really pleased to see
you here today, and he is president and CEO of the Grocery
Manufacturers Association. Then we have Jill Hollingsworth who
is group vice president for food safety programs at the Food
Marketing Institute. And then is Caroline Smith DeWaal who is
food safety director for the Center for Science in the Public
Interest; Dr. Alan Goldhammer who is deputy vice president for
regulatory affairs with PhRMA, the Pharmaceutical Research and
Manufacturers of America; and then we have Tom Kubic who is
executive director of Pharmaceuticals Security Institute; and
Mr. Hallock Northcott who is president and CEO of the American
Association of Exporters and Importers.
You have 5 minutes for your opening statement. They will
be made part of the record, and at the discretion of the
committee, we may submit questions, ask you to get back to us,
in which case we would ask you to answer those in writing for
inclusion in the record at a later time. So I will start with
Mr. Hubbard. You are recognized for an opening statement. Thank
you.
STATEMENT OF WILLIAM HUBBARD, SENIOR ADVISOR, COALITION FOR A
STRONGER FDA, CHAPEL HILL, NC
Mr. Hubbard. Thank you, Mr. Chairman. Given the size of the
panel, I will be very brief. I have a written statement. I will
just point out that we like to think that our food supply is
the safest in the world, but to some extent, the world's food
supply is becoming ours. This country now imports $2 trillion
worth of goods, and that will triple in the next few years. So
we are being inundated by these foreign products, and you have
pointed out the inadequacies in the current system, so I won't
repeat all of that information. But I will say two main points,
first, FDA is incapable of protecting the food supply vis-a-vis
imports with its current resource staffing. They only have 450
inspectors to look at what is approaching 20 million imports.
So they are simply inundated by that. Second, I believe a
paradigm is broken or the process is broken. It is 100 years
old. It once worked in the 1920s or 1930s, but it puts all of
the burden on this one small agency to identify a problem. And
so the producer, the exporter, and the importer essentially
don't have that responsibility. We need to move toward a system
where everyone is accountable.
Let me give one example. Let us say you have got a fish
farm in China or Vietnam or Indonesia, and now he has got
incentives to be as efficient as possible. He is crowding the
fish into a pond, he is feeding them perhaps chicken livers,
chicken droppings which are fairly high protein, and the water
is becoming very polluted. The fish are getting fungal and
bacterial infections. So he is adding drugs to keep the fish
alive until they can be harvested. Well, that farmer is
producing an unsafe food, and we see that all the time. The
problem is no one is checking him. He has the incentive to
produce this unsafe fish. His distributor in China has no
responsibility to do anything about that. The exporter, the
importer in the United States, it all comes down to whether FDA
will actually look at that fish and test it. And with an
inspection rate of less than 1 percent, that is not going to
happen. So we have the problem there that you can't depend on
an inspection process at the very end of the food chain. You
need it sooner.
So I am recommending that we consider much as your bill
does and as section 7 of Mr. Dingell's bill does moving toward
a system of prevention. Imagine that fish farmer now knows that
the importer is taking some responsibility and saying, well,
who am I getting that fish from? Is he producing safe fish? And
then the exporter in China is doing that, and then the
wholesaler in China is doing that. All the message down to that
farmer is, if I don't produce safe fish, I am going to be
checked by the people in the supply chain, and I am going to be
out of business. We need to give FDA the authority to set up a
process like that I believe and then fund it so that it can
verify the system is working. And I believe with that we can
have a safe food supply. In fact, many of the major food and
drug companies do this now. Cargill, or someone like that, is
already securing their supply chain. So we need to bring all
the other guys who aren't doing that up to that standard, and
then I believe we will have a safe food supply that everyone
can agree is managed in an effective way.
With that I will pass onto the next witness.
[The prepared statement of Mr. Hubbard follows:]
Statement of William K. Hubbard
Mr. Chairman and members of the committee, I am William K.
Hubbard. Before my retirement after 33 years of Federal
service, I served for many years with the U.S. Food and Drug
Administration, and for my last 14 years was an FDA Associate
Commissioner responsible for, among other things, FDA's
regulations and policy development. Although I have remained
retired since my departure from FDA in 2005, I provide advice
to The Coalition for a Stronger FDA, an organization comprised
of patient, industry, and public interest groups whose mission
is to urge that FDA's appropriations be increased. I will be
providing comments on FDA's resource constraints on behalf of
the Coalition, but my comments on specific legislative changes
do not necessarily reflect the Coalition's views and are solely
my own (as the Coalition does not take positions on non-
appropriations issues). During my career at FDA, I was deeply
involved in seeking improvements in FDA's ability to assure the
safety of foods, drugs, medical devices and other products that
are imported into the United States from around the world.
Accordingly, I wish to thank the Committee for moving quickly
this year to consider legislation that would strengthen FDA's
ability to oversee imports of food and other products from
other countries.
Background
This committee has often raised concerns about our Nation's
vulnerability to unsafe foods and drugs imported from abroad,
and illustrated those concerns with examples of illegal
pesticides on fruit from Latin America, deaths associated with
raw drug ingredients from China, and other instances of unsafe
goods produced in developing countries. FDA's scientists have
agreed with you that imports were a growing concern, as they
noted with increasing alarm the volume of imports moving from a
trickle to a stream to a flood, with no new resources or
authorities to deal with the problem. Perhaps the events of
this year--the deadly pet food ingredients, toothpaste tainted
with antifreeze, seafood laced with illegal drugs, and other
examples of dangerous imports--will serve as the national wake-
up call that is sometimes needed to get our institutions moving
toward effective solutions. And solutions are indeed needed,
for, Mr. Chairman, there can be no doubt that our current
system for overseeing food and drug imports is broken, and
therefore cannot protect us as it is currently structured.
The Current FDA Import Safety System
As was noted in July's Oversight and Investigations
Subcommittee hearing on imports, the current FDA system
predates the creation of the Food and Drug Administration.
First established in 1896, the system was designed to authorize
Federal inspectors to open and examine (and sample, if
necessary) foods and drug imported into the United States. It
was folded into the original Food and Drug Act that established
the FDA in 1906. And when the current statute authorizing FDA
to protect our foods and drugs was enacted by Congress in 1938,
the import provision was the only one of the original 1906
authorities that were believed to have worked well (and were
thus continued in the Food, Drug and Cosmetic Act that remains
FDA's principal legal authority). Congress' judgment at the
time was correct, as most imports were foods and FDA inspectors
could generally oversee imports via technology of the early and
mid-20th century--tools such as visual inspection, a well
trained sense of smell, microscopic examination, and laboratory
analysis. But as we neared the end of the century, it became
increasingly apparent that changes in the nature of imports
were overwhelming the ability of the FDA to assure their
safety, namely:
A huge increase in volume, for instance, from 2
million shipments of imported products regulated by FDA in 1993
to a level approaching ten times that today.
A tremendous surge in foods, drugs, medical
devices, cosmetics, animal foods, and dietary supplements from
developing nations that have little or no established
regulatory authorities overseeing production of those
commodities.
A shift in the types of commodities from
``finished'' products ready for consumption toward components
that are used to make finished products in the United States,
such as the active ingredients for our drugs from India and
many of our basic food ingredients from China.
A greater range of risks, such as new pathogens in
food unknown to science in past years, and the intentional but
dangerous addition of industrial chemicals and cancer-causing
drugs in products produced overseas.
An Agency Overwhelmed
Several times in recent years, examinations by
Congressional committees, the Government Accountability Office,
the National Academy of Sciences, and other expert panels have
concluded that FDA's ability to protect us from unsafe foods
and drugs has been steadily deteriorating. No better example of
that erosion exists than in the import area. Let me give you
just a few measures of how FDA's capacity lines up with its
responsibilities for imports:
The volume of imports, as I noted earlier, has grown to
the point that it is nearing 20 million annual shipments of
foods, drugs, medical devices and other FDA-regulated products.
Yet the number of import inspectors has not been increased, and
today the agency has only 450 inspectors to cover this massive
inflow of products, which means that less than 1 percent of
imports receive Federal inspection.
Imports of FDA-regulated products enter the United
States at many ports of entry. [Depending on how one counts a
``port,'' between 300 and 400.] But inspector staffing is so
low that they can man only about 40 ports, and many of those
only part time.
Despite the fact that there are thousands of
facilities oversees making products for our medicine cabinets
and dinner tables, the number of FDA inspections of those
facilities is tiny. For example, only 125 inspections of
foreign food manufacturers were conducted last year, and that
was down from only 209 in 2001. This year, the agency will do
even less, about 100. And for other products the numbers are
even more dismal--two dietary supplement foreign inspections
last year, zero animal food inspections, and zero cosmetics
inspections.
FDA's information systems, particularly those
focused on imports, are old and out of date. They cannot
interact directly with other agencies' systems, such as those
at Customs, and cannot even distinguish imports of road salt
from table salt.
FDA inspectors lack modern scientific tools to
make rapid assessments of imported goods for contaminants such
as bacteria, viruses, heavy metals and industrial chemicals.
They must undertake an expensive and time consuming process of
collecting a sample and sending it to laboratory for analysis,
often having to wait days for results.
With so few inspectors, FDA's laboratories cannot
be adequately used, and the agency has attempted to close some
for that reason. The result is that only a small number of
products even receive laboratory analysis. For example, only
20,000 samples of imported foods were sent for laboratory
analysis last year, out of about 10 million shipments. There
were about 200,000 shipments of food from China last year, for
example, so if ALL of the laboratory analyses were directed
toward China alone, FDA would have been able to analyze just 10
percent of those imports.
All in all, the parts of FDA that do not receive
user fees (for new drug and medical device review) have been
growing steadily weaker over the past decade, as the agency has
lost a thousand scientists and inspectors who would have been
protecting us from products on the market and those being
imported from overseas.
A Broken Paradigm
If the signs of FDA's failure to adequately oversee imports
are so clearly evident, then what can we say about how we got
to this point? There are, in my opinion, two principal reasons
for our current dilemma, both revolving around the paradigm
that current exists for imports--namely, FDA inspection, at the
border, to ``catch'' problems before they make it into our
homes.
First, FDA's budget has not kept pace with its growing
responsibilities. The agency has sustained either a flat
appropriation or actual cuts in their budgets for more than a
decade, at a time in which new problems and new regulatory
challenges have been thrown steadily at the agency. The food
safety program is a good example. It was almost half of FDA's
budget in the 1970's, but today is only about one quarter.
Let me give you a more recent example. FDA's food safety
budget was $407 million in 2003. If the agency had received
sufficient funding since then just to stay even with inflation,
the food safety appropriation for this year would be $626
million. But it was actually $450 million, which means that the
agency lost $176 million in buying power for food safety in
recent years. The result has been a loss of 20 percent of its
food scientists, and over 600 inspectors, during that time.
One would think that with a growing domestic food industry,
soaring imports of food from other countries, numerous new
technologies (such as biotechnology) being used to produce
food, an increase in food borne disease outbreaks associated
with foods regulated by FDA, and declining public confidence in
FDA, our leaders would be anxious to assure that the regulatory
structure would be strengthened.
Similar analyses can be done for other FDA programs, such
as drug and medical device safety, dietary supplements, and
animal foods and drugs. These trends are alarming, and
underscore the reasons for the creation of The Coalition for a
Stronger FDA. While the Coalition's members often disagree on
policy outcomes with respect to regulation, they are all
concerned that a weak FDA is detrimental to domestic business,
international trade, and, most importantly, public safety.
The second reason for our current vulnerability with
respect to imports is that the regulatory paradigm for those
products simply does not work in the 21st century. It is a
system fraught with flaws in today's world:
It is reactive system that looks for problems in
foods and drugs after they're arrived in the United States,
rather than preventing the export of contaminated products at
their source
It would need massive new resources to be
significantly improved, requiring hiring thousands of new
inspectors at a cost of billions of dollars, and even then may
not be able to meet our expectations
It continues to place all of the burden of
assuring safety on this one small agency--the FDA--rather than
requiring accountability by those who produce and import these
commodities,
It provides little incentive for foreign
governments and foreign producers to be vigilant in producing
safe goods for sale to the United States, and
It does not take into account modern principles of
product quality assurance that have recently been developed and
proven to work effectively in the production of food and other
products.In sum, Mr. Chairman, I believe we must re-engineer
our system of import oversight in ways that will not only
strengthen the FDA but also bring our trading partners and
their producers into a comprehensive safety assurance system.
Building Quality In
Let me give a brief history that I believe will illustrate
the concept of building safety into our food and drug supply.
Many Americans do not know the name F. Edward Deming, but he is
revered in Japan as one of the leaders in their post-World War
II effort to rebuild their economy. Deming convinced the
Japanese that traditional production methods, which relied on
post-production inspection, would not assure product quality,
and advocated instead a process whereby defects in a product's
manufacturing are prevented from ever occurring. The Japanese
embraced the concept and began a transformation in their
production of automobiles, electronics and other consumer
products that enabled Japan to shift from an image of a
producer of cheap, shoddy products--some would say analogous to
China today--to an economic superpower with a reputation for
product quality. American manufacturers eventually adopted
Deming's quality assurance philosophy, which has been credited
with improving quality in recent years of a host of U.S.-
produced consumer products.
This quality assurance concept was implemented for food by
the Pillsbury Corporation in 1960, when they were tasked by
NASA to develop food for the U.S. manned space program. A food
borne illness resulting in vomiting or diarrhea could be
catastrophic in the weightless space environment, so Pillsbury
developed a food production process to ensure that no
contamination could occur as the food was being produced,
thereby ``building safety in'' to the food as it was produced.
This concept, known by the acronym ``HACCP'' (for Hazard
Analysis Critical Control Points) was quickly used by FDA to
solve a series of contaminations in the 1960's in canned foods,
then used more recently to improve the safety of seafood and
juice. Meanwhile, the Agriculture Department adopted the
concept for improving meat safety in the United States, and the
European Union has legislated HACCP into its food safety laws.
FDA also developed regulations, utilizing the same quality
control concept, for drugs and medical devices, to minimize
production defects in those products.
An Emerging Consensus on a Solution--Build Safety In
As dismaying as the recent contaminations of seafood, pet
food, toothpaste and other commodities have been, they have
focused the various stakeholders in ways that would not have
been likely a few months ago. I believe, Mr. Chairman, that we
are seeing the development of the elements for needed change in
the regulation of imports that could be a wonderful, even
historic, opportunity to ``fix'' imports for the foreseeable
future.
Two weeks ago, the Interagency Working Group on Import
Safety created by the President this summer released a
``strategic framework'' that emphasizes a ``life cycle''
approach to the management of imports that builds prevention in
upstream from the FDA. Last week, the Grocery Manufacturers
Association/Food Products Association issued its ``Four
Pillars'' for import safety, which emphasizes the need for all
parties in the production and sale of imports to be accountable
for the safety of foods. Consumer groups have long urged that a
system of continuous quality controls over food production be
adopted to reduce food borne disease. And your committee's
draft import bill includes provisions that emphasize the need
for safety assurance across the supply chain.
My point is that I believe you are all saying fundamentally
the same thing--that the answer for import safety is a system
based on prevention that requires producers, exporters,
importers, U.S. purchasers ``everyone in the chain of supply--
to take greater responsibility for the safety of imports, and
give FDA the authority and resources to implement and oversee
such a system.
A System Based on Prevention
I urge you to accept this emerging consensus among the
various stakeholders as a sign of a tremendous opportunity to
re-engineer our import safety system in ways that will save
lives, reduce illnesses, enhance our citizens' confidence in
their government, and perhaps even improve some of our trade
relationships. The elements of legislation that would focus on
a system of prevention could include:
An express requirement for a foreign supplier
quality assurance program that importers would implement to
provide greater assurance of the safety and quality of imported
food products and ingredients;
Enhanced international standard setting, for
better consistency in safety standards across the globe;
Agreements with exporting countries that would
improve their capacity and willingness to better oversee
producers within their borders;
Procedures to assure that verification is made
that safety standards are being followed, and
A strengthened FDA, with resources to strengthen
the agency's scientific base; to gather and utilize new
technologies for screening imports; to create modern IT systems
to track the movement of imports; and to recruit and train
inspectors to oversee the new system--both by better, risk-
based inspections at the border and by more frequent
inspections of foreign facilities.
I believe it is entirely possible for the Congress to bring
together the disparate interests involved in import safety and,
keying off of the very basic concept of prevention throughout
the supply chain, craft legislation that could be accepted by
consumers, the industry, and the current administration.
Obviously, there would be many details to consider, but, in the
end, the goal of a better, more effective import screening
system is achievable. And, of course, there are other
authorities that members of Congress have considered in the
past, such as country of origin labeling, new recall authority
and more. But those additional authorities would not, in my
view, address the fundamental problem of why FDA cannot assure
the safety of imports. Thus, I urge the committee to consider
making a system of prevention your primary objective, and I
thank you for allowing me to express my views on this subject.
----------
Mr. Pallone. Thank you. Congressman Dooley.
STATEMENT OF HON. CALVIN M. DOOLEY, PRESIDENT AND CEO, GROCERY
MANUFACTURERS ASSOCIATION
Mr. Dooley. Well, thank you, Congressman Pallone,
Congressman Buyer. It is a delight to be here. I have the honor
and privilege of representing over 300 companies in the U.S.
that manufacture food and beverage products. So every time you
go into the grocery store and you see those brands on the
aisles there, quite likely they were produced by my member
companies; and they are absolutely committed in working in
partnership with all of you and this committee to ensure that
we can build upon what we consider the safest food supply in
the world to make it even safer.
What we have proposed, the Grocery Manufacturers just
recently, is what we call the four pillars for safer food; and
we are trying to build upon that foundation of an incredibly
safe food supply. But the underlying premise of this is much
like Mr. Hubbard talked about is we can be most effective by
focusing on prevention because while we know there is work to
be done and there are improvements, when you look at all the
food products that are in a grocery store today, we are
fortunate that it is a small, a very, very small number of
those that pose any health or food risk to a consumer. And so
what we need to be focused on is that we understand we have a
small problem, but it is not a large problem. It is almost like
how do you find that needle in the haystack with that needle
being that food safety concern? So our objective needs to be
how do we limit the number of needles and also how do we reduce
the size of that haystack so that it makes it easier for FDA to
allocate their resources in order to make a difference.
Our pillar one is really to develop a mandatory foreign
supplier quality assurance program, and under this pillar, all
importers of record, which is a company that is importing a
food product, would be required to develop mandatory protocols
that would ensure that they have a greater confidence in the
safety of those products that they are importing. We would ask
FDA to develop guidance in terms of what would be the
components for this mandatory foreign supplier quality
assurance program. And the reason why we are going down this
path is that every one of our member companies, the greatest
equity that they have in their company is the brand of their
product; and that brand of their product is what makes a
difference in whether or not that consumer will take it off the
shelf. And if that consumer has any concerns in terms of the
safety of that product, they in fact, will not purchase it. And
so we are totally committed, and we think we are in the best
position to really make a difference in preventing contaminated
food products.
The pillar two really works on the voluntary qualified
importer food safety program, and this is really focused on how
do we reduce the size of the haystack understanding that there
are some food products that we are importing or ingredients
that are in fact of lesser risk, and there are also
opportunities for food producers and processors to work in
cooperation with FDA to provide them with additional
information which in fact can lower the risk of concern of a
food safety problem.
And pillar three is something we think is absolutely
critical is that this Government and FDA needs to be working to
build the capacity of foreign governments to develop equivalent
food safety programs within their countries.
And also pillar four is something that we have been working
very closely with many of the organizations that are
represented at this table, is that we have to expand the
capacity of FDA. We are a part of the coalition for a stronger
FDA which is asking for a doubling of the budget of the Food
and Drug Administration over the next 5 years because we are
not going to be successful in giving the FDA the resources to
enhance their participation and partnership in this effort to
achieve greater food safety if they do not have additional
resources.
The one thing that I would like to spend just a moment in
talking about some of our concerns with the legislation that
was in fact implemented. The industry and my member companies
have great concern about a user fee approach as we think that
food safety is a public good, it is a responsibility of the
Federal Government, and it should be paid for out of general
fund dollars. We are concerned about whether or not you can
actually in fact implement an equitable user fee approach that
doesn't have unintended consequences. And I just brought two
products, two little props here, which can kind of demonstrate
that. If you have a line item, a user fee of $50 per line item,
I have a product here that is Madras Lentis that is a product
of India. This product would come in under one line item and
thus would pay that one $50. We could have a very similar
product coming in, a vegetarian chili product, that was
manufactured in the U.S. that has a number of different
ingredients in it. Those ingredients, many of which would be
imported into this country, would be paying a separate line
item or that user fee on each of those ingredients. You are
creating a perverse incentive for many food processors and
manufacturers to locate their processing facilities across the
border in order that they could minimize the cost of a user fee
that would be coming into this county.
There are also concerns similar to this on part of the
country of origin labeling. All processed foods that are coming
into the country today has to be labeled as to the country of
origin where it had substantial or significant transformation.
We are concerned, and there is a lack of detail on the country
of origin labeling requirements, that again this product from
India could be a product of India, but this product
manufactured in the United States might be required to have
separate line items in terms of where each of the ingredients
was sourced, further complicating the marketing and the
packaging of this product.
We also have concerns that have been articulated in terms
of the port of entries. We do not think that you can restrict
it to the 13 or so that have FDA lab facilities. We think that
is of great concern to us. We also have concerns, too, with the
certification process being prescribed. We think that just the
testimony that Dr. Acheson gave, there are 400,000 food
suppliers in China alone. There are almost that many in India.
We are looking at millions of food suppliers throughout the
world that we would have to be in the position to try to
certify, and we think that would become such an onerous and
costly burden and wouldn't be the best allocation of FDA funds.
We think that our proposal will ensure the private sector can
provide better information, that we can share that information
with FDA in a manner that we can achieve the shared objective
of enhanced level of food safety.
[The prepared statement of Mr. Dooley follows:]
Statement of Hon. Calvin M. Dooley
I am Cal Dooley, president and CEO of the Grocery
Manufacturers /Food Products Association. I am here today to
discuss an issue of paramount importance to our members--
ensuring the safety of imported foods.
Food producers have an abiding interest in safe food.
Maintaining consumer confidence in our products, our brands,
and our companies is the single most important goal of the
food, beverage, and consumer packaged goods industry, and
product safety is the foundation of consumer trust. My industry
devotes enormous resources toward this goal, and effective
regulation and oversight by Federal regulatory agencies such as
the FDA are critical and complementary elements of the fabric
of consumer protection.
This month, GMA/FPA issued ``Commitment to Consumers: The
Four Pillars of Food Safety,'' a comprehensive proposal
designed to protect consumers by strengthening, modernizing,
and improving the system governing food imports. Our proposal
envisions new mandatory requirements for the food industry to
assure the adequacy of foreign supplier food safety programs
and new responsibilities for FDA. Other elements include a new
program to help identify and prioritize imports of potential
concern, new efforts by FDA to help enhance the capacity of
foreign governments to prevent and detect food safety issues,
improvements to FDA's scientific capabilities and its use of
information technology, and a significant increase in FDA
resources.
Underlying this comprehensive set of proposals is a
fundamental emphasis on prevention.
Let me put the challenge before us in plain terms. As the
volume of imported food steadily increases, the FDA's job at
the border can be compared to trying to find a needle in a
haystack. We need to approach this task from different angles:
(1) by reducing the number of needles to find; and (2) by
reducing the size of the haystack in which to find them.
A complete copy of the ``Four Pillars'' proposal has been
submitted with this written testimony. Before I provide
comments on the Food and Drug Import Safety Act introduced last
week, I will take just a few minutes to briefly outline each of
the four pillars for you now.
Pillar One: Mandatory Foreign Supplier Quality Assurance
Program--Under this pillar, all importers of record would be
obligated to adopt a foreign supplier quality assurance program
that assures that all imported ingredients and products meet
FDA food safety and quality requirements. Food companies would
utilize FDA guidance to adopt food safety programs and
practices needed to ensure food safety, such as audits,
testing, good manufacturing practices, good agricultural
practices, HACCP plans, food defense programs, product
management systems, and recall programs. Requiring importers of
record to ensure the safety and quality of their supply chain--
and giving FDA the authority to review the effectiveness of
these programs--would reduce the number of needles in the
haystack.
Pillar Two: Voluntary Qualified Importer Food Safety
Program--To help prioritize FDA resources and to relieve
congestion at ports, we further propose that importers of
record who are able and willing to meet additional standards
and conditions than those required under Pillar One could
voluntarily participate in a program entitling them to
expedited entry at U.S. borders. This is similar to the Safe
and Secure Food Importation Program Chairman Dingell has
proposed in the Food and Drug Import Safety Act introduced last
week and builds upon the C-TPAT program currently in place. In
addition to demonstrating the presence of well-designed and
implemented food safety systems, importers could demonstrate a
secure supply chain and conduct and share additional testing
and program data with FDA to be eligible for expedited entry.
By permitting expedited entry for imported foods that pose no
meaningful risk, Congress can reduce the size of the haystack
needing closer scrutiny by the FDA.
Pillar Three: Build the Capacity of Foreign Governments--
FDA would work with foreign governments to improve their
capacity to prevent and detect threats to food safety. FDA
would work with foreign governments to expand training,
accelerate the development of laboratories, ensure the
compliance of exports with U.S. regulations, permit appropriate
FDA inspections of foreign facilities, and ensure adequate
access to data and test results conducted abroad. In addition,
FDA would be encouraged to use Codex to harmonize requirements
among countries. The food industry has long supported
international harmonization through Codex, and we believe that
FDA must once again provide international leadership towards
the adoption of strong, science-based international food safety
standards. All of these foreign capacity building steps would
further reduce the likelihood of contamination and thereby
further reduce the number of needles for FDA to find at the
border.
Pillar Four: Expand the Capacity of FDA--Expanding FDA
resources--including personnel, equipment, laboratory capacity,
and scientific expertise--is an essential component of an
effective food safety system. FDA resources have not kept pace
with the demands posed by rising imports and current food
safety challenges. To meet these needs, Congress must provide
significant new funds to dramatically improve FDA's analytical
testing capabilities, to increase and target inspections
conducted by FDA, to obtain real-time test results, and to
enhance communications during crisis events. With additional
resources that are well-deployed, FDA should be much better
positioned to find any remaining needles before they cross the
border and enter U.S. commerce.
We believe that the adoption of these four pillars of food
safety will result in significant improvements in our food
safety net. By focusing our efforts on prevention--and by
expanding and improving our ability to detect threats to public
health--we believe that our proposal will do far more to ensure
the safety and quality of imported food products and
ingredients than would the adoption of many of the provisions
of the Food and Drug Import Safety Act and will build upon the
partnership between FDA and the food industry.
Food companies recognize that growing food imports pose new
challenges and we share the same goal as the committee: to
continually improve the safety and quality of food products and
ingredients. We are grateful for the opportunity to work with
you to develop comprehensive imported food safety legislation
which makes the prevention of contamination the cornerstone of
our food safety net.
While inspecting products at the border is an important
element of a comprehensive approach to food safety, we believe
that inspections alone will not provide enough improvement to
the safety of our food supply. We strongly agree with your
desire to find more resources for FDA, which needs to restore
its scientific base as well as its capacity to conduct an
appropriate level of inspection and examination. However, we
strongly oppose the user fee provision in the Food and Drug
Import Safety Act. We have five significant concerns with the
user fee.
One, we believe that the benefits of a safer food supply
accrue to the public generally, much like the benefits of a
strong national defense, and believe that the costs of
providing FDA with sufficient resources to perform the various
responsibilities to protect the public health that have been
given to it by the Congress should come through taxes, not user
fees. As you know, a user fee is appropriate when the benefits
of the government service flow to an individual (such as
postage stamps, recreation fees, or public transportation) or
to a particular business (such as harbor maintenance fees,
accelerated review of prescription drugs, or bankruptcy filing
fees). The benefits of inspection and research clearly flow to
all Americans, not simply to food companies.
Second, the proposed user fees would impose significant
financial burdens on U.S. companies, not just on importers.
This is especially true for companies with facilities in both
the U.S. and Canada, for example, where there is a steady flow
of ingredients and finished products, all of which would be
subject to import user fees. We are in the process of
collecting data to estimate the added costs to U.S. businesses,
but we have reason to believe they would be substantial.
Third, the imposition of the user fee on imported products
and ingredients could create an incentive for companies to
locate production facilities outside the United States. Let me
provide an example of why this is so. Suppose a company makes a
product in the United States that consists of 20 ingredients,
half of which are imported. Under the user fee proposal, a fee
would be imposed on ten of those ingredients each time they are
imported. If, on the other hand, the production facility was
located in Mexico or Canada, for example, the fee would only be
imposed once: when the finished product was brought into the
United States.
Fourth, we are concerned that a user fee on imports would
violate our trade commitments by creating a preference for
domestic sources of food products and ingredients. We're also
concerned that such a fee could invite other countries to place
similar fees on our food exports. Finally, we are concerned by
the mechanics of the user fee. By charging $50 per line of
food, the user fee in the Food and Drug Import Safety Act
places an unfair burden on importers of many distinct products.
We strongly agree that FDA needs more resources to increase
inspectors, improve its scientific capabilities, and meet other
critical needs. For the past year, GMA/FPA has worked with the
Coalition for a Stronger FDA to substantially increase FDA
funding. In our view, FDA does not simply need ``more''
resources, but needs the ``right'' resources. In particular, we
believe that the agency needs additional resources for both its
``science'' and its ``compliance'' activities. The agency
cannot operate effectively without both. Our goal is to double
FDA's food-related spending over five years, and we applaud
Chairman Dingell for his efforts to seek additional FDA
spending.
We have other major concerns with the Food and Drug Import
Safety Act and we look forward to working with the committee to
address these and other challenges.
One, we are concerned that proposals to limit imports to
certain ports and to require the development and implementation
of certain tests could create havoc at the border and create
costly and unachievable new burdens on FDA and the food
industry. In particular, we are concerned that the proposal to
limit food imports to ports of entry located in the same
metropolitan area where FDA has a laboratory could
unintentionally block food imports to many ports. While there
are more than 300 ports of entry, there are only 13 FDA labs.
As a result, many ports--including all ports in Texas and
Florida--would no longer be able to import food products and
ingredients. We believe a better course would be to expand and
better target FDA inspectors, as we have proposed in our second
``pillar'' and Chairman Dingell has proposed in section 7 of
the Food and Drug Import Safety Act, and to expand FDA's
capacity to quickly analyze food products and ingredients.
We are also concerned about requirements to develop rapid
tests within three years and to test all processed food
products. While we share your desire to make rapid-tests and
other sampling methods widely available, we are concerned that
requiring the development of such tests within three years may
be unrealistic. We are also concerned that a requirement,
included in Section 12 of the Food and Drug Import Safety Act,
that all processed food be tested to detect substances that
make the food adulterated creates an impossible burden: there
is simply no way to test for all potential causes of product
adulteration. In our view, requiring every importer of record
to implement a foreign supplier quality assurance program--and
placing the focus of imported food safety efforts on
prevention, rather than detection--would significantly improve
the safety of imported food to a far greater degree and build
upon the strong partnership between food companies, our
suppliers, and FDA.
Two, we are also concerned about two new labeling
requirements included in the Food and Drug Import Safety Act.
First, packaged food products are already required to bear
country of origin labeling. Second, we are concerned that the
proposal to require country of origin labeling for all food
could create huge new burdens on food companies while providing
little or no benefit. Many of our food companies combine
ingredients from dozens of countries to create a single
product. Would the proposed country of origin labeling
requirement mean that each ingredient has to be labeled with
its country of origin? We are also concerned that a ``safety
notice'' on meat, poultry or seafood that contains carbon
monoxide to affect coloring would needlessly mislead the
public. As you know, this practice has been subject to
exhaustive testing and has been declared safe by FDA.
Three, we are also concerned that Food and Drug Import
Safety Act violates our trade agreements and would invite
retaliatory actions by our trading partners. As I mentioned,
the adoption of user fees would create a clear preference for
domestic food products and ingredients and would invite the
adoption of similar fees on our exports. In addition, we are
concerned that a requirement that all foreign facilities
importing food into the U.S. obtain FDA certification would
place enormous new burdens on FDA, would violate our trade
agreements, and would invite reciprocal demands by our trading
partners. Further, we do not believe that there are likely to
be resources available--even with user fees--for FDA to certify
tens of thousands of foreign facilities located in about 150
different countries.
Four, there is ample evidence that the current recall
system works well. We are concerned that the due process
protections that necessarily accompany the recall proposal in
the Food and Drug Import Safety Act could actually delay, not
accelerate, efforts to address public health threats. As you
know, food companies have powerful incentives to remove
adulterated products from commerce as quickly as possible and
have worked closely with FDA to implement recalls quickly and
effectively. We strongly support efforts to expand FDA's
ability to communicate the risks posed by adulterated foods.
In conclusion, we share your commitment to the improving
the safety of imported food. We also share your commitment to
increase FDA's resources, including resources to increase our
ability to detect adulterated food at the border. However, we
believe that far more emphasis must be placed on the prevention
of threats to food safety throughout the supply chain and look
forward to working with you to make a safe and secure supply
chain the responsibility of every importer of record and to
expand the capacity of foreign governments to detect and deter
threats to public health.
Our ``Four Pillars'' proposal builds on the long history of
public-private responsibilities and cooperation in ensuring
food safety, while providing new and innovative approaches to
the latest challenges to our Nation's food safety net. Its
focus on prevention would be complemented by an enhanced
ability to quickly detect and address public health threats.
Meeting the challenges of the modern supply chain requires
additional public resources for FDA and related agencies and
demands an integrated approach that leverages the significant
investment of the private sector in product safety. We look
forward to working with the committee to fashion comprehensive
legislation that will address the new challenges posed by
rising food imports and will continually improve the safety of
our food products and ingredients.
----------
Mr. Pallone. Thank you. I just realized, Calvin, you went
over 5 minutes. I didn't pay attention. So I will ask the
others to stick to the 5 minutes, even though he used twice the
time; but that is all right, you are a Congressman, so we will
allow it.
I do have to tell everyone, though, that we will have two
votes; so I am going to try to get in one or two of you before
we go vote, and you will have to wait until we come back.
So next is Dr. Hollingsworth.
STATEMENT OF JILL HOLLINGSWORTH, D.V.M., GROUP VICE PRESIDENT,
FOOD SAFETY PROGRAMS, FOOD MARKETING INSTITUTE
Dr. Hollingsworth. Chairman Pallone and members of the
committee, thank you for the opportunity to appear before you
today to present our views and suggestions on H.R. 3610. I am
Dr. Jill Hollingsworth, the group vice president at the Food
Marketing Institute, FMI, where I have been head of the Food
Safety Program for over 10 years. FMI is a national trade
association with 1,500 member companies representing food
retailers and wholesalers in the United States and abroad. Our
members represent over 75 percent of all retail food store
sales in the U.S., accounting for $340 billion in annual sales.
In my capacity at FMI I often have to draw upon my past
experiences at USDA where I worked for 15 years. While I was
there, I not only implemented the investigation of the E. coli
outbreak at Jack-in-the-Box, but I was responsible for
developing and implementing the public health and recall
programs that exist today in the Food Safety and Inspection
Service.
At FMI I worked closely with the supermarkets and their
wholesalers to ensure that we are doing all that we can to
achieve a safe food supply, but we are very concerned about the
recent decline that we have seen in consumer confidence in the
food safety system. In January 2007, FMI's own survey of
consumers called U.S. Grocery Shopper Trends found that
consumers' confidence in the safety of the food purchased at
supermarkets dropped from 82 percent down to 66 percent, and
for restaurants that drop in confidence declined to 43 percent.
Numerous recalls and the lack of confidence in both the food
system and the Government have actually caused consumers to
actually change their purchasing habits with over 38 percent of
consumers saying they no longer buy certain items such as
spinach because they are afraid of the safety of the food.
Enhancing the safety of our food supply would require active
effort and aggressive support of the business community such as
food wholesalers and retailers working with the Government.
This is a farm-to-table challenge, and it will take a farm-to-
table solution; and it is both a domestic and an international
problem that we must address together.
As the retailers and wholesalers of this country, we are
working to improve safety through four focused programs. First,
we want to ensure that our suppliers, whether they are domestic
or international, are actively managing a science-based food
safety program. We do that through our own Safe Quality Food
Program, a global food safety training, audit, and
certification system. Second, we train and certify our own
supermarket employees in safe handling practices through
education programs called SuperSafeMark, and we have trained
this year alone over 15,000 food store managers.
Third, we provide consumers with practical science-based
advice on food handling in the home through the cooperation for
the Partnership for Food Safety Education. This is a public/
private sector program that brings together consumer groups,
FDA, USDA, CDC, and the industry sector. Our president, Tim
Hammonds, is the founding chair and immediate past chair of
this educational partnership.
Fourth, FMI's Board has appointed a food safety task force
made up of chief executives from retail and wholesale
companies. The task force is currently looking at ways that we
can improve our Nation's food recall communication system to
make it more effective and efficient. As I mentioned, there is
a need to restore consumer confidence and to reduce food borne
illnesses. To that end we would want to work with this
committee, but we also want to be sure that we can do so
without hindering the ability to serve our customers. To that
end, any changes that we consider must be able to answer some
questions: Can they be supported by science, do they in fact
provide measurable benefits, are they affordable, realistic and
practical, and can they be implemented without unintended
consequences.
For example, in H.R. 3610, we support the concept of an
expedited review process for those companies that comply with
FDA guidelines. Here is an example of where the private sector
can be of assistance. Through our safe quality food program, we
are able to audit all of our suppliers as often as we need to,
and we can grant them accredited certification when they meet
the standards at or above FDA's. We also support the operation
of the FDA field labs. Rapid tests should be developed based on
the seriousness of the threat posed by the pathogen or
chemical, and we also feel that these tests should be used to
monitor the food safety system, not to inspect food. Another
provision that we may be able to support is mandatory recall.
Under our current recall system, food companies have an
outstanding history of compliance, and we do not want to change
anything that would possibly slow down the recall system.
However, if the Secretary had the option to mandate a recall,
in the event that a company were to refuse, then we could
consider supporting such a provision. This is slightly
different from the bill language. We would be more inclined to
supporting the Secretary with the authority to option, if a
mandatory recall is necessary, rather than telling the
Secretary he must issue a mandatory recall.
FMI cannot support the proposal for user fees on imported
foods and drugs. Not only will this raise the cost of food for
the American consumer but we also feel it presents a conflict
of interest. FMI and its members are very concerned about the
provision to restrict U.S. ports of entry. I think we have
heard many examples of why the system will just be damaging to
our country. Ultimately the consumer will be the loser with
higher costs for food and less availability of quality, fresh
foods. We also do not support the proposed provision for carbon
monoxide labeling of meat, poultry, and seafood. Both FDA and
USDA have recognized this technology as being safe, and it is
not the only packaging system that is currently used to extend
color of foods. We are not aware of any scientific basis for
singling out one technology for a warning label.
The bill also contains a provision requiring country of
origin labeling. FMI strongly objected to the mandatory Country
of Origin Labeling Law created in the 2002 farm bill because it
placed the entire burden for labeling on retailers. Retailers
are the last link in the supply chain, and we should not, in
fact we cannot, be accountable for ensuring the location of
where food originated. The concept of certifying foreign
governments and countries by FDA sounds very promising as we
move toward a risk-based system and one that we can support.
That system is one that we would support, but there does
need to be a more pragmatic approach as to how this could be
accomplished. We look forward to working with you on these and
other concerns. Thank you.
[The prepared statement of Dr. Hollingsworth follows:]
Testimony of Jill Hollingsworth, D.V.M.
Chairman Pallone and members of the committee, I am honored
to appear before you today to present our views and suggestions
on House bill 3610, the Food and Drug Import Safety Act. I am
Dr. Jill Hollingsworth, group vice president of the Food
Marketing Institute (FMI). I have been in charge of food safety
programs at FMI for the past 10 years
FMI is a national trade association that has 1,500 member
companies made up of food retailers and wholesalers in the
United States and around the world. FMI members operate
approximately 26,000 retail food stores with combined annual
sales of $340 billion, representing three quarters of all
retail food store sales in the United States. FMI's retail
membership is composed of national and regional chains as well
as independent grocery stores. Our international membership
includes some 200 companies from more than 50 countries.
In my capacity at FMI, I often draw upon my past work
experience at the U.S. Department of Agriculture (USDA). I
spent 15 years there and led the investigation of the Jack-in-
the-Box E. coli outbreak in 1992. I subsequently set up food
safety and recall programs and a liaison program with the
Center for Disease Control in Atlanta and the U.S. Public
Health Service. While there I also served as a Veterinary
Inspector, Special Assistant to the Administrator of Food
Safety and Inspection Service (FSIS) and Assistant Deputy
Administrator of FSIS.
Presently, I work closely with supermarkets and their
wholesalers to ensure we are doing all we can to guarantee a
safe food supply--operating clean and safe stores; adhering to
science-based best practices; responding to emergency
situations; educating the public about safe food handling
practices; and, working with our Federal, state and
international partners to improve food safety programs.
In 2007, consumer confidence in the food supply reached its
lowest point since 1989. FMI's own survey of consumers, U.S.
Grocery Shopper Trends, found that consumer confidence in the
safety of foods purchased at supermarkets dropped from 82
percent in 2006 to 66 percent in 2007. And for restaurants, the
drop in confidence was down to 43 percent. Recalls and the lack
of confidence in both the food system and government have
caused consumers to actually change their purchasing habits,
with 38 percent of consumers saying they have stopped buying
certain food items because of food safety concerns. For
example, in January of this year, 71 percent of consumers
reported they no longer buy spinach.
We realize that restoring consumer confidence and
strengthening our food safety system is of paramount
importance. We understand and support your goals. Enhancing the
safety of the food supply requires the active effort and
aggressive support of the business community--such as food
wholesalers and retailers--as well as government. This includes
our work with suppliers, especially beyond our borders, our
commitment to train our own people and our outreach to
consumers. It is a farm-to-table challenge that needs a farm-
to-table solution. It is both a domestic and an international
problem we must address together.
Accordingly, the retail food industry is actively involved
in improving food safety in the U.S. We are doing this through
four focused programs: SQF (Safe Quality Food program);
SuperSafeMark; the Partnership for Food Safety; and, our Board
Level Food Safety Task Force.
I would like to highlight a few of the retailer/wholesaler
food safety initiatives in place. First, we work with our
suppliers to ensure that they are following best practices. We
have been aggressively implementing a new standard in food
safety--one based on science, for all suppliers, from the
smallest farm to the largest manufacturing plant. This program
is called Safe Quality Food, or SQF. The SQF standard is one of
only five programs in the world that has received recognition
from the Global Food Safety Initiative, a group of
international food safety experts. What makes SQF unique is
that we require suppliers to carry out risk assessments, and
after they have put their food safety program in place, we
monitor their performance through third-party audits. Only
those companies in compliance with this international standard
can receive SQF certification.
Second, on the domestic front, we train and certify our
supermarket employees in safe food handling through a program
especially designed for retail called SuperSafeMark. Currently,
we train and certify about 15,000 store managers a year and we
train thousands of store employees so that they comply with the
FDA Food Code.
Third, we provide consumers with practical, science-based
advice on food-handling in the home. We do this through The
Partnership for Food Safety Education. This is a joint private-
public sector project that brings together consumer groups, the
FDA, USDA, CDC and a wide variety of other industry
associations. Our president, Tim Hammonds, is the founding
chair and immediate past chair of the partnership. The
Partnership is responsible for the FightBAC campaign to teach
food safety to children and others; the Chill Out program to
remind consumers about keeping their home refrigerators cold;
and, most recently, the Be Food Safe promotion providing
retailers with the tools they need to educate their customers
about safe food practices.
Fourth, FMI's Board has appointed a food safety task force
made up of the chief executives from retail and wholesale
companies around the world. The task force is looking at how we
can make our nation's food recall communications system more
effective and efficient. We are working in concert with our
trading partners and will be glad to communicate with this
committee on our progress as we work toward improvements in the
recall system.
As I mentioned earlier, there is a need to restore consumer
confidence and to reduce the burden of foodborne illness; to
that end we want to work with the committee to accomplish our
shared goals but in a way that does not hinder our ability to
serve our customers and ensure an affordable and abundant food
supply. Many of the proposals in H.R. 3610 are well founded,
but we must be sure that any changes to our current food safety
system meet certain criteria. They must:
Be supported by science,
Have measurable benefits,
Be affordable,
Be realistic and practical,
And, be implemented without unintended
consequences.
Mandatory Recall Authority
Regarding mandatory recall authority, we realize that under
our current voluntary system of recalls, a company has never
refused to withdraw adulterated product at FDA's request or
they have taken action on their own. However, if the Secretary
is given the option to mandate a recall in the event a company
did refuse, we can see where this would build confidence in the
recall system. We note that this approach differs somewhat from
the current bill language, which would require FDA to issue a
cease distribution order upon a finding of food adulteration.
Rapid Testing Techniques for Use in Inspection of Imported
FoodsAnother area of potential agreement is the development of
rapid testing techniques for use in inspections of imported
foods. We urge the committee to pursue this avenue as long as
scientists and researchers prioritize this work. Developing
rapid or screening tests should take into account: the
seriousness of the threat posed by the pathogen or chemical;
how frequently it occurs as a food contaminant; and, the
likelihood that a rapid test methodology would be successful.
We would also encourage FDA to work with USDA, CDC, and other
public and private entities to share expertise, resources and
laboratories in pursuing this.
Safe and Secure Importation Food Program
The provision for a safe and secure importation of food
program that recognizes those companies that comply with new
FDA guidelines in exchange for expedited review of their
product is a good idea. Here is an area where the private
sector can be of assistance if companies demonstrate their
compliance to a food safety standard through an accredited
certification program such as SQF. SQF requires that a company
be in compliance with the regulatory requirements of both the
exporting and importing country, in addition to the standards
set by the retail buyers. Although not intended to be a
substitute for government oversight, the private sector can add
an additional layer of ``policing'' for products entering into
the U.S. food supply. We would need to see the details of FDA's
plan as many factors such as tracking compliance, the security
of the company's supply chain, etc., would need to be taken
into consideration. It would also be important to coordinate
these efforts with USDA, Customs and other Agencies.
Continued Operation of FDA Field Laboratories
We fully support the continued operation of FDA Field
Laboratories. These labs provide needed scientific support and
credibility. One consideration for reform would be to determine
the capabilities at each of the labs and designate certain ones
as a ``center of excellence'' for a selected type of test or
procedure.
User Fees on Imported Foods and Drugs
Although we strongly agree that FDA and its food safety
programs are under-funded, FMI cannot support the proposal to
impose user fees on imported foods and drugs. Not only will
this raise the cost of food, but we also consider such fees to
be a conflict of interest by the Agency in charge of inspecting
and raising money for its own budget. We are unsure what direct
impact user fees on food will have on our retailers and have
asked them to review this.
Restricting the Ports of Entry for Imported Foods
FMI and its members are very concerned about the provision
to restrict U.S. ports of entry for imported foods. We
understand that the provision is modeled on the USDA system,
but when applied to the broad spectrum of products under FDA
supervision, it becomes unworkable and prohibitively expensive.
Mr. Chairman, U.S. ports are already busy to the point of
congestion. And there is increasing concern in the retail
community that the growth in port capacity is simply not
keeping pace with the growth in demand. Limiting the number of
ports food can enter into through legislation will not only
aggravate congestion and delays, it could also increase the
cost of food for the American consumer.
As you know, quite a bit of food that enters the country
is perishable and needs to be shipped, sold and consumed in a
limited period of time. A shipment of apples or pears cannot be
left sitting on a dock for an extended period of time. As
delays increase, so does shrinkage, waste and--unfortunately--
costs.
FMI is particularly concerned about the ability of these
ports to handle the spike in imports of perishable commodities
during the winter months, when the U.S. growing season for a
number of products is over. The only way to meet demand for
certain fruits and vegetables during this period is through
imports. But again, delays at the port-level threaten our
ability to bring these products to market in a timely manner
and increase costs. And unfortunately, it is the American
consumer who bears the brunt of this increase, particularly
poorer Americans. As prices rise, consumers do not just pay
more, they often consume less. When talking about fruits and
vegetables, this is clearly not the desired outcome.
I would also note that there are significant costs
involved with closing ports of entry and shifting freight
elsewhere. Food importers that have distribution centers at or
around the ports that will no longer accept food will have to
move their operations and face the expense of building and
setting up new centers. Long-established supply lines will have
to be reworked, which can be both expensive and costly. And the
impacted districts are likely to see a decline in employment
and tax revenues as the importers shift employees to their new
operations.
As an example of the disruption of trade, ninety percent
of seafood shipments enter through 14 ports (Los Angeles; New
York; Miami; Portland ME; Seattle; Boston; Norfolk; Tampa;
Savannah; San Francisco; Houston; Philadelphia; New Orleans;
and, Nogales, AZ), according the National Fisheries Institute.
Of the 14 ports, only four are co-located with FDA
laboratories: New York, Seattle, Savannah (Atlanta laboratory)
and San Francisco. This would render states such as Florida
unable to accept seafood products.
Country of Origin Labeling
Section 6of the bill would require labeling to identify the
country of origin of food, drugs, and medical devices and would
require FDA to promulgate final regulations within 180 days of
the law's enactment that would likewise take effect within 180
days of enactment. We have several concerns with this provision
in terms of timing, necessity and efficacy.
In terms of timing, based on our experience with the
regulations for country of origin labeling for seafood alone,
we can report that the development of regulations for the 80
percent of the food supply that falls within FDA's jurisdiction
within 180 days would be virtually impossible. Moreover, the
Tariff Act already requires imported food products to bear
country of origin labeling, leaving open the question of what
additional service this provision would apply and what standard
the bill intends for the industry to use. That is, given the
breadth of countries that may be involved in sourcing
ingredients (and ingredients of ingredients) for processed
foods, what country should be listed as THE country of origin
for any given food product if a different standard is to apply?
More importantly, however, identifying one--or twenty--
countries from which food or its ingredients derives does not
enhance the safety of the underlying food product. The
resources that would be required to develop and implement the
complex system that such labeling would entail would be far
better spent on measures that would actually have the potential
to improve the safety of the product.
Certifying Foreign Governments and Companies
The concept of certifying foreign governments and companies
by FDA sounds promising as a nod toward a risk-based system,
but it gives rise to many questions. For example, how would FDA
implement a mandate of this magnitude? FDA does not have the
financial or personnel resources to take on this endeavor even
with the $300 to $500 million projection from the user fee
provision of the bill. Before moving forward with this, FDA,
USDA and others should map out a plan for how such a system
might work.
We would also encourage the committee to remember that a
number of developing countries may face severe difficulties in
meeting the requirements of any certification programs. At the
very least, both FDA and USDA need to be prepared to provide
both technical and monetary aid to support capacity building in
those areas.
We agree that foreign governments should be held
accountable for demonstrating that they have regulatory systems
in place equivalent to those in the U.S.; evaluating other
government programs might be a more realistic starting place.
We would also suggest using some of the existing resources of
USDA, APHIS and others who are already in those countries and
ask them to take part in inspections and possible
certifications.
Adequate Testing of Processed Food Products
Providing adequate testing of processed food products post-
production presents challenges because there is no objective
way to ensure testing is truly ``adequate.'' It is more
effective to implement and monitor prevention programs, and use
testing as a measure of how well those food safety programs are
performing. This approach supports risk-based systems where
resources are directed toward making sure products are safe
through process control, such as HACCP (Hazard Analysis
Critical Control Points) and certified third party audit
programs.
Carbon Monoxide Labeling for Meat, Poultry and Seafood
We do not support the proposed provision for carbon
monoxide labeling of meat, poultry and seafood. Both FDA and
USDA have recognized that carbon monoxide is generally
recognized as safe for its intended purpose. We are not aware
of any scientific basis for singling out this one technology
for labeling.
Thank you for the opportunity to testify. We appreciate the
efforts set forth in H.R. 3610 to help restore confidence in
the food safety system and reduce foodborne illness. We remain
available to the committee for further discussion and
information should you need it.
----------
Mr. Pallone. I think we only have about 6 minutes left, so
I am going to recess. We only have two votes, so it should be
about maybe 15, 20 minutes. Thank you. The subcommittee is in
recess.
[Recess.]
Mr. Pallone. The subcommittee will reconvene, and we left
off with Ms. DeWaal.
STATEMENT OF CAROLINE SMITH DEWAAL, FOOD SAFETY DIRECTOR,
CENTER FOR SCIENCE IN THE PUBLIC INTEREST
Ms. DeWaal. Thank you, Mr. Chairman. I am Caroline Smith
DeWaal, and I direct the Food Safety Project for the Center for
Science in the Public Interest. We represent over 900,000
consumers, both in the U.S. and Canada; and I need to tell you
that last year consumer confidence in the safety of the food
supply declined dramatically by 16 percent in just 1 year.
Concerns about imported food was also very pronounced; and in
July, 83 percent of shoppers expressed concern about food from
China, and 61 percent were concerned also about food from
Mexico. This concern is really, totally understandable given
the fact that we have so many outbreaks and recalls last year
from contaminated food.
For years CSPI has advocated for new, legal structure to
modernize FDA's Food Safety Program, and we really congratulate
the chairman on his leadership in introducing the Consumer Food
Safety Act. Recently, the Bush administration and the food
industry both agreed that the systems in place today are not
sufficient to ensure the safety of imported foods. In fact, the
food industry's Four Pillars Reform Proposal recognizes several
essential areas for modernization. Such broad agreement clearly
signals that the time is right for Congress to act on reforming
the country's food safety laws.
Congress also appears poised to address this problem and to
fund it adequately as just last week in the PDUFA legislation,
you passed a sense of Congress that talked about the need to do
this and Congress' commitment to it. And the emergence of
coalitions like the Coalition for a Stronger FDA including
groups which are traditionally estranged or on opposite sides
of the table, consumer and industry organizations, this gives
Congress a unique opportunity to appeal to many constituencies
as it creates a modern food safety system.
Change is hard, but it has been done before and in many
other countries. The United Kingdom reformed its food safety
program and established the Food Standards Agency in 1999; and
this agency has proven effective in reducing the incidents of
food borne illness and in rebuilding public confidence. In
fact, food borne illnesses declined 18 percent within the first
3 years of the new agency, and public confidence in the safety
of the food supply rose from 44 percent to 60 percent. This
change came after food scares, most notably from mad cow
disease in the 1990s which led all sides to recognize both the
need for change and built the momentum to reach workable
compromises.
I believe that we are at the same nexus of crisis and
consensus in this country that Britain faced in the 1990s and
that the momentum for building a stronger food safety system is
growing.
I have a number of specific comments with respect to
Chairman Dingell's legislation, and they are mostly included in
my written testimony. I do want to mention that the
certification procedure in the bill has greatly improved from
what was originally announced in August, but it does need to
probably be fine tuned with some regular audits of foreign
national programs, including inspections of facilities.
In addition I am concerned that the user fee proposal may
distract from many important questions about legal authority,
so I would hope that the user fees, if they are going to move
forward, doesn't bog down the process.
The bottom line though is while this bill contains many
excellent components, we believe that really to restore
consumer confidence, Congress must go further and enact
comprehensive legislation to address today's food safety
hazards, both foreign and domestic. Preventive control systems
implemented by the food industry and performance standards
monitored and enforced by the Government must form the heart of
needed reforms to FDA's legal structure. Only such
comprehensive reforms will protect the food supply and restore
consumer confidence.
U.S. food safety laws are more than 100 years old and were
never designed to deal with the modern issues such as
escalating imports, bioterrorism, or tainted produce.
Legislation is needed that creates a program that puts public
health at the forefront of food safety. We urge Congress to
take action before the next congressional election to modernize
food safety laws and to fully fund our National Food Safety
Program. Thank you.
[The prepared statement of Ms. Smith DeWaal follows:]
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Mr. Pallone. Thank you. Dr. Goldhammer.
STATEMENT OF ALAN GOLDHAMMER, DEPUTY VICE PRESIDENT, REGULATORY
AFFAIRS, PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA
Mr. Goldhammer. Thank you very much, Chairman Pallone. It
is a pleasure to return to the subcommittee and talk about this
important issue. PhRMA looks forward to continueing to work
with the full committee to ensure patient safety because
patients and their healthcare providers quite reasonably expect
that our medicines will safely and effectively treat the
diseases that they are diagnosed with. American patients trust
that the drugs dispensed for their conditions are not
counterfeit, and our companies obviously don't want patients
getting counterfeit medicines because such medicines could
result in effectual or even dangerous medical outcomes.
The Prescription Drug Marketing Act which originated with
this committee was a critical piece of consumer legislation
passed as a result of Congressional concerns regarding the
integrity of the drug distribution system that existed at that
time. The passage of this legislation established the closed
distribution system that we have today. The PDMA, coupled with
the exacting regulatory requirements of the FDA helps to
minimize the possibility of a consumer receiving a counterfeit
drug. The pharmaceutical industry is already intensively
regulated. Our companies manufacture products following
exacting standards that have been reviewed and approved by the
FDA. They employ extensive quality systems to assure that
innovative medicines provide consistent, positive health
outcomes. However, even the most effective medicines cannot
help patients if those medicines were compromised by loopholes
or breakdowns in the pharmaceutical distribution system which
could provide opportunities for diversion or counterfeiting.
The remainder of this testimony will focus on the FDA
regulatory system that assures quality, steps that
manufacturers take to implement quality systems, and finally
some thoughts about what policymakers might consider to further
secure the pharmaceutical supply chain.
Throughout the drug development process, our companies
focus on the quality of the product and put into place
manufacturing controls that result in a medicine that is
consistent from lot to lot with respect to purity and potency.
Information is collected on the product's stability so the
patient may be assured, the expiration date is based on sound
science, and that the medicine, if used within this period of
time, will provide the therapeutic dose the doctor has
prescribed. All of this information is submitted to the FDA for
review in the license application. FDA not only reviews all
this data but conducts the preapproved inspection in the
manufacturing facility to ensure that it is in compliance with
good manufacturing practice regulations.
These GMPs cover the quality control unit, buildings and
facilities, equipment, control of components and drug product
containers, enclosures, production and process controls,
packaging and labeling control, clothing and distribution,
laboratory controls, record and reports, and finally, returned
and salvaged drug products. When companies use outside vendors
or contract manufacturers for any components or parts of the
finished medicine, extensive qualification and standards
testing regimes are put in place to ensure the materials
received meet the standards established by the pharmaceutical
company. Companies regularly audit these suppliers to make sure
that source materials are produced in a manner consistent with
the specifications outlined in the manufacturing agreements.
Quality assurance is also an ongoing part of the business. It
does not stop when the NDA is approved and production
commences. Companies have a regulatory responsibility to
continuously monitor so that each lot released in the
commercial distribution system meets the FDA approved
specifications.
While PhRMA believes the United States drug distribution
system is the safest in the world, there are some steps we have
advocated that will further secure the pharmaceutical supply
chain. First, we need increased requirements for repackagers.
PhRMA believes that FDA should reassess its policies and
procedures regarding repackaging operations. Repackaging has
been identified as a weak spot in the drug distribution system
that can be used as an entry point and distribution center for
diverted and counterfeited drug products. Repackagers remove
drug products from their original packaging and labeling
thereby destroying any counterfeit-resistant technologies
employed by the original manufacturer. Consequently, additional
oversight is necessary to ensure that repackaged drug products
are authentic and not compromised by such repackaging
operations.
Second, we believe the Federal requirements for wholesalers
and distributors should be strengthened. We support efforts to
strengthen licensure requirements for wholesalers and
distributors. Recent investigations in Florida have identified
systemic weaknesses in the oversight of the wholesale drug
industry, and there have been many newspaper articles detailing
this as well. These weaknesses permit individuals, even those
with prior felony convictions, to obtain wholesale licenses for
operations that deal in diverted and counterfeit drug products.
Third, we believe that there should be increased criminal
penalties for counterfeiting activities. We believe that the
criminal penalties for counterfeiting prescription drug
products must be significantly increased. The current penalty
under the Federal Food, Drug, and Cosmetic Act, a maximum of 3
years' imprisonment, does not reflect the serious public health
risks associated with counterfeit drugs or serve as an adequate
deterrent to prospective counterfeiters. We thus support
increasing the maximum criminal penalty for counterfeiting drug
products from 3 to 20 years imprisonment.
We look forward to working with the committee as you move
forward with this important legislation. Thank you very much.
[The prepared statement of Mr. Goldhammer follows:]
Statement of Alan Goldhammer
Thank you Mr. Chairman and members of the Energy and
Commerce Committee. My name is Alan Goldhammer, Ph.D., and I am
the deputy vice president for regulatory affairs at the
Pharmaceutical Research and Manufacturers of America (PhRMA), a
trade association representing the leading research-based
pharmaceutical and biotechnology companies. We are pleased to
have been invited as part of this discussion, and look forward
to continued work with the committee to ensure patient safety.
PhRMA members alone invested an estimated $43 billion in
2006 in discovering and developing new medicines, and patients
and their health care providers quite reasonably expect these
medicines to safely and effectively treat the diagnosed medical
condition. America's patients trust that the drugs dispensed
for their conditions are not counterfeit. Pharmaceutical
companies obviously don't want patients getting counterfeited
medicines, because such medicines could result in ineffectual
or even dangerous medical outcomes.
The Prescription Drug Marketing Act of 1987 (PDMA), was a
critical piece of consumer legislation passed as a result of
Congressional concerns regarding the integrity of the drug
distribution system that existed at the time. The passage of
this legislation established the closed distribution system
that we have today. The PDMA coupled with the exacting
regulatory requirements of the Food and Drug Administration
(FDA) helps minimize the possibility of a consumer receiving a
counterfeit drug.
Pharmaceutical companies manufacture products following
exacting standards that have been reviewed and approved by the
FDA. They employ extensive quality systems to assure that
innovative medicines provide consistent positive health
outcomes. However, even the most effective medicines cannot
help patients if those medicines are compromised by loopholes
or breakdowns in the pharmaceutical distribution system, which
could provide opportunities for diversion and counterfeiting.
The remainder of this testimony will focus on the FDA
regulatory system that assures quality, the steps manufacturers
take to implement quality systems, and finally some thoughts
about what policy makers might consider to further secure the
pharmaceutical supply chain.
Throughout the drug development process, pharmaceutical
companies focus on the quality of the product and put in place
manufacturing controls that result in a medicine that is
consistent from lot to lot with respect to its purity and
potency. Information is collected on the product's stability so
that the patient can be assured that the expiration date is
based on sound science and that the medicine if used within
this period of time will provide the therapeutic dose the
doctor has prescribed. All of this information is submitted to
the FDA for review in the New Drug Application (NDA) (or
Biologics License Application (BLA) for biologics and
biotechnology products). FDA not only reviews all of this data
but also conducts a pre-approval inspection of the
manufacturing facility to insure that it is in compliance with
Good Manufacturing Practice (GMPs) requirements as outlined in
21 C.F.R. Parts 210 and 211.
The GMPs cover the quality control unit; buildings and
facilities; equipment; control of components and drug product
containers and closures; production and process controls;
packaging and labeling control; holding and distribution;
laboratory controls; records and reports; and finally returned
and salvaged drug products. When companies use outside vendors
or contract manufacturers for any components of the finished
medicine, extensive qualification and standards testing regimes
are put into place to assure that the materials received meet
the standards established by the pharmaceutical company.
Companies regularly audit their suppliers to make sure source
materials are produced in a manner consistent with the
specifications outlined in the manufacturing agreement(s).
Quality assurance is an ongoing part of the business; it
does not stop when the NDA is approved and production
commences. Companies have a regulatory responsibility to
continuously monitor so that each lot released to the
commercial distribution system meets the FDA approved
specifications.
While PhRMA believes that the Unites States drug
distribution system is the safest in the world, there are some
steps that we have advocated that we believe will further
secure the pharmaceutical supply chain.
1. Increase Requirements for Repackagers. PhRMA believes
that FDA should re-assess its policies and procedures regarding
repackaging operations. Repackaging has been identified as a
weak spot in the drug distribution system that can be used as
an entry point and distribution center for diverted and
counterfeit drug products. Repackagers remove drug products
from their original packaging and labeling, thereby destroying
any counterfeit resistant technologies employed by the original
manufacturer. Consequently, additional oversight is necessary
to ensure that repackaged drug products are authentic and are
not compromised by repackaging operations. PhRMA believes that
FDA could better regulate the authenticity and quality of
repackaged drug products if it had authority to require prior
approval of repackaging operations. At a minimum, FDA should
increase its inspections of repackagers and, where appropriate,
initiate enforcement action. In addition, repackagers should be
subject to the same requirements regarding overt and covert
counterfeit resistant technologies as original manufacturers.
2. Strengthen Federal Requirements for Wholesalers/
Distributors. PhRMA supports efforts to strengthen the
licensure requirements for wholesalers and distributors. Recent
investigations, particularly by the Florida Grand Jury and the
Washington Post, have identified systemic weaknesses in the
oversight of the wholesale drug industry in many states. These
weaknesses permit individuals, even those with prior felony
convictions, to obtain wholesaler licenses for operations that
deal in diverted and counterfeit drug products. PhRMA supports
efforts by Florida and Nevada to strengthen requirements for
the licensure of wholesalers by, for example, requiring the
posting of a substantial performance bond (e.g., $100,000) and
conducting detailed pre-licensure background checks and
facility inspections. PhRMA believes, however, that licensure
requirements should be strengthened consistently across all
states to prevent diverters and counterfeiters from re-locating
to states without strong licensure requirements. This can best
be accomplished through revisions to 21 U.S.C.0 Sec. 503(e)(2)
specifying higher minimum standards for state licensing of drug
wholesalers and distributors similar to those currently in
place in Florida and Nevada. FDA also should review state
requirements for the licensure of wholesalers to ensure that
they meet any enhanced minimum Federal regulatory requirements.
3. Increase Criminal Penalties for Counterfeiting
Activities. PhRMA believes that the criminal penalties for
counterfeiting prescription drug products must be significantly
increased. The current penalty under the Federal Food, Drug,
and Cosmetic Act (FFDCA)--a maximum of three years
imprisonment--does not reflect the serious public health risks
associated with counterfeit drugs or serve as an adequate
deterrent to prospective counterfeiters. PhRMA thus supports
increasing the maximum criminal penalty for counterfeiting drug
products from three to twenty years imprisonment. PhRMA also
believes that criminal penalties should be imposed against
entities that create a market for diverted and counterfeit drug
products by purchasing drug products without adequate due
diligence into the source and authenticity of such drugs. PhRMA
thus supports making it a prohibited act under the FFDCA to
purchase prescription drugs from a wholesale distributor
without first obtaining and verifying the information provided
on a drug pedigree.
----------
Mr. Pallone. Thank you, Doctor. Mr. Kubic.
STATEMENT OF TOM KUBIC, EXECUTIVE DIRECTOR, PHARMACEUTICALS
SECURITY INSTITUTE
Mr. Kubic. Thank you for this opportunity to provide
comments concerning an issue of growing importance to all
Americans, the safety and security of their medicines as well
as their food.
Today there are trans-national criminal organizations who
ignore regulations formulated by drug regulatory authorities
and who regularly violate laws designed to ensure the integrity
of medicines that are widely available here in the United
States. They manufacture, they distribute counterfeit medicines
indiscriminately without any regard to the current good
manufacturing processes.
I hope that these discussions today will help lead to a
better understanding that the risks facing the public today are
indeed real. My name is Tom Kubic, and I am the executive
director of the Pharmaceutical Security Institute. PSI is
comprised of 24 security directors of the major manufacturers
of pharmaceuticals. They have operations in more than 160
countries.
The goal of PSI is to support our members in their efforts
to ensure the distribution of pharmaceuticals that are safe and
effective. PSI's mission is to collect, to analyze, and to
disseminate information about counterfeiting, theft, and the
illegal diversion of medicines. This information is then shared
with the authorities so that they can initiate appropriate
investigations and activities. In my opening remarks, I just
want to make a few statements about the nature and extent of
counterfeiting, the counterfeiting facts, if you will.
PSI conducts an annual assessment of the worldwide
situation regarding counterfeit medicines. In the Fifth Annual
PSI Situation Report, we found that many individual criminals
and criminal organizations continue to be actively engaged in
pharmaceutical crimes. The support of this statement is the
fact that last year PSI reported 1,371 new incidents, roughly
22 percent as an increase over calendar year 2005. Throughout
the year we added another 150 incidents that actually occurred
in 2005, and the 2-year total exceeded 2,494, roughly 100
incidents around the world each and every month.
The increases in 2005 and 2006 were not an isolated trend.
In fact, the 5-year trend line includes generally speaking
double-digit increases in counterfeiting incidents around the
world. Some would say this number of incidents is small. In
fact, what we see is an increase in quantity of medicine and an
even wider variety of medicines that being counterfeited. For
example, in November 2006, in Mexico City itself at 14
locations, 11 tons of counterfeit medicines were seized. In
July 2007, in Jakarta, Indonesia, 4\1/2\ tons of illegal
medicines were seized. In contrast to 2006, when each incident
had either one to 45 different drugs found that were
counterfeit, in 2007 the Jakarta seizures, for example, 88
different types of medicines were counterfeited.
The numbers of countries experiencing counterfeiters remain
about the same in 2006. There were 100, the preceding year it
was 101. However, we have seen a concentration on fewer numbers
of drugs with the exception of 2007. In 2006, 560 different
types of medicines were counterfeited, and then in 2005, it was
687 different products.
Counterfeiting is no longer limited to the so-called
lifestyle drugs. In fact, virtually every type of medicine has
been determined to be counterfeited.
So what has been the law enforcement response? In calendar
year 2006, worldwide there was an actual 10 percent reduction
in counterfeit arrests. There were a total of 755 documented
individuals arrested for this activity in over 56 different
countries. While it was encouraging to see that the majority of
these arrests occurred in the Asian region, fully 33 percent of
the worldwide arrests, it was also important to note that those
arrests, the largest category, was for manufacturing of
counterfeit medicines versus the sale or distribution of
counterfeit medicines.
In summary, the challenge of counterfeits, stolen, and
diverted pharmaceuticals is fairly clear from the Situation
Report. More incidents have occurred, fewer arrests have been
made. Americans need to know that the U.S. markets have been,
is now, and will continue to be an area that is of keen
interest to these organizations. Their safety today is
endangered whenever they venture outside of the closed system
of acquiring their pharmaceuticals and they move into such
bizarre places such as the Internet. Thank you.
[The prepared statement of Mr. Kubic follows:]
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Mr. Pallone. Thank you. Mr. Northcott.
STATEMENT OF HALLOCK NORTHCOTT, PRESIDENT AND CEO, AMERICAN
ASSOCIATION OF EXPORTERS AND IMPORTERS
Mr. Northcott. Good afternoon, Chairman Pallone, members of
the committee. My name is Hal Northcott, and I am here
representing the American Association of Exporters and
Importers, and we very much appreciate this opportunity to
speak on H.R. 3610.
AAEI is a cross-section of the Nation's supply chain in
that we are made up of manufacturers, distributors, retailers,
freight forwarders, insurers, brokers, foreign trade zones, and
ports all across the country, both large and small business.
Each of these businesses is engaged in actively getting stuff
in and out of the United States. That is what they do, that is
who we represent.
With this background, let me say that we are here today to
address by section only those portions of the bill on which our
trade, security, and logistics knowledge may be of some benefit
to the community.
So if I might, let me begin with section 2 on port
inspection, which for brevity, we will comment on in linkage
with section 7 covering restricted ports of entry. Here I would
like to make three points. First, the use of a tried and true
inspection system like that of the USDA is very initially
appealing. However, taking that model which has been applied to
a comparatively small scope and volume of meat, poultry, and
eggs and then trying to apply it across the enormous volume of
imports, food in particular, nationwide creates a whole new
logistical ballgame. Frankly, it is highly problematic.
Second, the application of the restricted port inspection
system will have predictable but significant impact nationwide
in that there will be clearly perceived winners and losers.
That would make 313 ports losers and 13 winners. However, let
me assure you that even the perceived winners will face some
serious new problems and we believe unintended consequences.
Third, we would urge the committee to take a serious look
at the enormous volume of data that has been referenced over
and over again during this testimony. In this we commend to you
CBP's developing ITDS, or International Trade Data System,
which for rough purposes is roughly comparable to the air scoop
on the hood feeding crucial data to the engine block which in
this case is the automated commercial environment. This is a
good thing, and frankly it enables the very important drive
toward one face at the border which our friends at CBP are also
spearheading. And may I note here that CBP, like FDA, is badly
lacking necessary resources, and we encourage your action in
that regard.
So separately, we ask that you appreciate that while a
successful import safety program with its data must have
transparency, data is private property and it is highly
valuable. It must not be given away to the bad guys in a world
filled with foreign government-owned and subsidized industries
and extensive industrial espionage. In the name of American
competitiveness, data protection is crucial.
Now let us turn briefly to section 6, the rules or origin,
and here frankly we have two requests, both very short. We ask
that you please do not permit this Congress to confuse rules of
origin labeling with an effective safety program. It is
certainly a useful consumer element, but it doesn't do much if
anything to solve the real world's import food safety problems.
And second, in looking at rules of origin, we suggest that the
Congress please do not impose yet another country-of-origin
standard upon your import/export industries. Believe me, with
the further proliferation of new and differing rules of origin
found in existing and forthcoming FTAs, it is sufficiently
confusing for industry already. Please look to existing
standards.
I am going to go briefly to section 7 and say that we
endorse the concepts here and have been actively engaged with
the FDA in trying to create this type of program for the last
four years. The personnel with whom we have worked do a fine
job. The low-risk model will go a long way in promoting
America's huge food export markets. But all of the above, I
would say as a final point, one fundamental springs to the top
of any supply chain list, and here we would ask that you
recognize, despite important similarities, that trade,
security, and product safety are not the same. They are
fundamentally different. They may look and feel the same on the
surface, but they are truly worlds apart. At its most basic,
trade security is concerned with the integrity of the supply
chain, ensuring that the box or container and its contents have
not been tampered with in packaging or transport. Thus, it is
secure. In direct contrast, what you are addressing today, food
product safety, is focused on the individual item inside those
boxes. Product safety targets the composition, functionality,
quality, and overall integrity of the food product. It is
inside versus outside, the two must not be confused.
And with that, thank you very much. We would like to
conclude our testimony and offer again our appreciation.
[The prepared statement of Mr. Northcott follows:]
Statement of Hallock Northcott
A. Introduction and Overview
Chairman Dingell, Ranking Member Barton, Ranking Member
Deal, and members of the committee, my name is Hall Northcott
and I am president and CEO of the American Association of
Exporters and Importers (AAEI). AAEI appreciates the
opportunity to offer its comments on your effort to address
import product safety in the Food and Drug Import Safety Act of
2007 (H.R. 3610)
AAEI is a trade association comprised of U.S. and
multinational manufacturers, distributors, retailers, freight
forwarders, insurers, brokers, foreign trade zones and ports
across the country, each engaged in the import and export of
merchandise to and from the United States. In one fashion or
another we truly represent the scale and scope of America's
supply chain. We have helped educate and then externally
represented the trade community in domestic regulatory,
legislative, and public policy arenas since 1921 and in recent
years have moved to assertively represent American import and
export interests in multiple international forums.
AAEI's primary focus has long been ``getting things in and
out of the United State in the most efficient, practical and
responsible manner seen worldwide.'' In this we have long been
a strong supporter of supply chain integrity and security as
well as facilitation throughout the full-range of trade
community issues affecting customs and international commerce.
In short, AAEI believes that it is vital for the government and
the trade community to work closely together and coordinate
supply chain security, facilitation and import product safety
for the United States to maintain a critical balance between
the free flow of legitimate trade and safe and secure goods.
However, we are not expert in food product safety matters and
thus are to here to support the committee in its efforts
impacting supply chains, trade processes and those multiple
aspects of today's global trade reality with which we are very
familiar. It would be our pleasure to support, assist and
encourage the committee in these efforts.
It is indeed a privilege to appear before you on behalf of
Chairman Charlene Stocker, our Board of Governors, and our
members, found in every industry nationwide. Our testimony
reflects the trade community's eagerness to work with the
committee to ensure that the Nation's product safety measures
work--for consumers, the government, manufacturers, importers
and exporters. In particular, we hope that we can assist you in
your efforts to advance product safety by both fully exploring
and thus utilizing all the current trade related statutory and
regulatory tools available.
Since 9/11, AAEI and the U.S. business community have
worked diligently with the Department of Homeland Security,
U.S. Customs and Border Protection and multiple government
agencies at the Federal, state and local levels to develop
programs designed to maximizing homeland security protection
primarily through reducing the likelihood that the global
supply chain could be used by terrorists as a delivery system
for weapons of mass destruction. Frankly, we have long been and
remain concerned that many important trade facilitation
functions can be relegated to secondary status in the press of
today's critical security environment. Thus, it has been our
intent to assist in ensuring that robust security practices
enhance the flow of legitimate trade such that the twin goals
of trade security and trade facilitation are mutually
complementary. In this, while we often have significant
disagreements as to details and applications, we would strongly
commend the efforts and personnel of the CBP and related DHS
leadership for their commitment to vital national goals.
In relation to the above trade and supply chain concerns,
we have recently begun to explore, in depth, related product
safety issues and believe that ensuring product safety and
integrity should be viewed as an important ``third leg of a
stool'' which strengthens the other two legs--security and
facilitation. Although balancing these interests is
unquestionably a difficult task, we believe that H.R. 3610 has
provisions of great value in further structuring the overall
framework. We look forward to working with you to safeguard
achieving this productive balance between these roles is a
vital national interest and those U.S. policies and programs
critically important for the United States to remain
competitive in the global marketplace. In this we will support
your efforts to further encourage the growth of our nations
reliable, efficient and successful international trade system.
This system must remain healthy if our Nation is to retain and
enhance its position at the head table of global commerce.
B. Setting a Framework for Import Product Safety Difference
AAEI's testimony on Setting a Framework for Import Product
Safety touches upon four topics which we understand to be of
particular interest to this committee 1. Low risk and account-
based management works and can be used to enhance import
product safety; 2. trade security and product safety are
different and are based on divergent principles including
different risk tolerances; 3. Interagency cooperation,
particularly data exchange through the International Trade Data
System (ITDS), is essential; and 4. Enhancement of manpower and
resources for multiple agencies both directly and through third
parties should be approached with an eye to significantly
enhanced capabilities.
Frankly, at some point in the future, we would welcome the
opportunity to discuss with the committee a number of subjects
including 1) the multiple impacts, since 9/11 upon commerce
and, in particular, small and medium business of the
substantial number of security programs launched, as stand
alone efforts, 2) the cumulative affect of proliferating
Federal agency actions outside of CBP jurisdiction which
increases the complexity and cost of the import process, 3)
Federal agencies movement towards harmonizing U.S. regulations
with international standards, 4) additional compliance
requirements, 5) ongoing pressure on agencies to impose new
user fees on importers that are, at best, ``toll booth taxes''
rather than fees for additional government services, and 7) new
proposals each year seeking market data demands as well as more
transparency and resilience from the global supply chain than
can be digested and implemented by the trade community in the
short period of time required by statutory deadlines.
Low Risk and Account-Based Management is Highly Efficient
Account-Based Management. For many years, the trade
community has partnered with CBP and DHS to develop low risk
importer programs for both trade security and trade compliance
purposes. In regulating over 825,000 importers, CBP had to make
strategic choices in deploying its already scarce, and
increasingly depleted, resources while the volume of trade
continued to increase. CBP's strategy, going back to the
1980's, incentivizes companies with good security procedures
and internal controls to join voluntary programs for mutual
advantage and, dependent upon the program, a menu of trade
facilitation advantages through reduction of processes or
complexity of steps required. A critical part of this strategy,
as directed earlier by the Congress, is treating importers as
an ``account'' by reviewing the companies'' record of
compliance for all their importations, rather than individual
transactions. By treating importers as an account, CBP is able
to quickly determine a company's compliance profile and work
with the company to remedy any deficiencies. CBP can then
concentrate its resources on companies which do not demonstrate
a high level of compliance and present the great risk for
violations. In these efforts, CBP serves as an excellent model.
One example of a flourishing public private partnership at
work today is found in the risk management operations of a
widely accepted account based program now in its 6th year. This
is the Customs Trade Partnership Against Terrorism (CTPAT)
program which today, while truly voluntary, has, in many
industries become the acknowledged standard upon which business
is done. C-TPAT is a government-business initiative to
strengthen and improve overall international supply chain and
U.S. border security. Those businesses that choose to apply are
making a commitment to work toward the goal of creating a more
secure and efficient supply chain in partnership with CBP.
One key feature, that we would specifically note for the
committees consideration is that, after multiple discussions
with industries and congressional committees committed to this
program's success, CBP did not fall prey to the easy answer of
imposing a ``one size fits all'' approach in this wholly new
effort. Instead of the ``one size fits all'' approach, CBP and
DHS succeeded in developing a successful program by recognizing
that different products, sourcing regions, and supply chains
have different operations and levels of risks. We would
strongly urge the committee to explore the many reasons for
adopting this approach. In this effort, one vital aspect is the
ongoing verification and recertification program. Here, for
instance, they issued and used extensively in the ongoing
verification process, a Supply Chain Security Best Practices
Catalog to provide importers with a compendium of the optimum
and most effective efforts developed by other companies. This
catalog has helped promote CTPAT's wide acceptance in the trade
community as evidenced by the fact that there are over 7,500
certified participants in C-TPAT. As of today, approximately,
5,000 validations have been completed and we expect the
remainder will be validated by the end of the year. However, we
would hope that any efforts that the committee might wish to
initiate would from date of implementation be adequately
staffed for efficiency in implementation.
In a significant precedent, Congress has already accepted
and enhanced C-TPAT's risk management approach to security by
providing statutory recognition of this program in the Security
and Accountability for Every (SAFE) Port Act. In this
legislation, they sanctioned its voluntary nature, and tiered
levels of participation linked to specific benefits. For most
U.S. companies with global supply chains, C-TPAT membership is
a requirement in today's business environment. C-TPAT has also
serves as a model for the European Union's Authorized Economic
Operator certification for security and the World Customs
Organization's (WCO) adoption of the ``Framework of Standards
to Secure and Facilitate Global Trade'' (the Framework of
Standards). Here we see an international strategy, based upon
clearly established U.S. principles to secure the movement of
global trade in a manner that does not impede it, but instead,
facilitates the movement of global trade. In this, AAEI has
been privileged to support various initiatives in multiple
international forums.
Trade Security and Product Safety Are Different
AAEI recognizes that though there are important
similarities, trade security and product safety are
fundamentally different. We have noted and attempted to
incorporate those differences in our now four year effort to
assist FDA in the development of low risk importer programs
which, in our opinion, would have substantially benefited all
parties. We remain hopeful that important progress towards this
goal can be made through both the regulatory and legislative
processes.
It is fair to say that, at its most basic, trade security
is primarily concerned with the integrity of the supply chain
and ensuring that the ``box'' (i.e., the cargo container) has
not been tampered with during transport so that no weapons of
mass destruction or other harmful substances are
surreptitiously placed in the box after sealing at the point of
stuffing. On the other hand, product safety is focused on the
integrity of commodity in the box. Specifically in FDA
jurisdiction, we understand there needs to be focus on
microorganisms, toxins, pathogens, pesticides and problematic
chemicals. In this effort, there is clear recognition that
regulated food testing requires examination outside of the
containers. In other words it is our understanding your product
safety effort is specifically directed to ensure for the Nation
the quality, functionality, safety and overall integrity of the
product. This is not even comparable. Frankly, with apologies,
in the contrast of ``inside the box'' and ``outside the box,''
we must point out that these are, as my niece has said, simply
apples and zebras. One element which this committee could
appropriately explore is an import safety is current company or
independent testing policies at FDA. Currently, AAEI is unaware
of any variety or method of internal testing which a company
can do to reduce processing and inspection time for food, drugs
and medical devices. However, it is important to note that
would be a fundamental change in culture and resource
requirements for FDA to fully implement a programs which take
advantage of ongoing extensive domestic industry efforts. Thus,
any efforts which the company makes do not help without agency
facilitating product delivery. Perhaps the nearest match to
product safety requirements in today's business environment is
in the quality assurance process (QA)--which so many American
companies excel in and can help by providing valuable lessons
for the committee's use in crafting language.
Interagency Cooperation Is Essential--ITDS is a Vital Tool
In fostering necessary interagency cooperation, and thus
effective and efficient import and export programs, the
Congress made an important first step in strongly encouraging
what has become known as ``One Face at the Border.'' The effort
has been designed to eliminate lack of coordination and even
agency cross purposes, at our land, air and sea ports.
Achievement of this goal was initiated in the creation of the
Department of Homeland Security. Over the past several years,
AAEI has testified to the importance of both preventing
restoration of and further eliminating the extraordinarily
burdensome and inefficient processes which have been suggested
by a variety of special interests.
Increasing the government-wide focus on product safety,
including CPSC leadership and multiple agency participation in
the enforcement of Intellectual Property Rights protection,
along with tracking financial transactions that may be
financing terrorism are extremely worthy goals. Unprecedented
cooperation and formal coordination of efforts, whether
legislative or administration driven, would make all the
difference.
In this, AAEI and the trade community have long supported
the government's multi-agency automation efforts and the use of
data to provide more transparency to the supply chain and
import clearance process. One of our top priorities in the
passage of the SAFE Port Act was the inclusion of a provision
mandating Federal agency participation in the International
Trade Data System (ITDS). ITDS is intended to be a ``single
window'' of trade data for government agencies to advance
electronic access trade data provided by the importer in order
make the import clearance process a seamless process for
importers, CBP, and other Federal agencies that license
imported products or have ``release and hold'' authority for
regulated imports. In a rough analogy, ITDS is the air scoop on
the hood feeding vital data to the engine of the Automated
Commercial Environment System (ACE).
We continue to believe that interagency cooperation and, at
minimum, data exchange through the ITDS is essential. While
full data sharing may not always be possible, alignment of
agency goals with our nation's regulatory framework is crucial.
In sum, use of the ITDS tool, if fully supported by vital
agencies and bureaus, is highly beneficial for all involved and
its maturation should be a much higher priority. We are
gratified that the President's Interagency Working Group on
Import Safety highlighted the importance of ITDS by
recommending the acceleration in the development of ITDS in its
initial report to the President, ``Protecting American
Consumers Every Step of the Way: A Strategic Framework for
Continual Improvement in Import Safety,'' issued on September
10, 2007. We hope the committee can take advantage of this
important tool in development of its overall legislative
strategy to improve product safety.
a. U.S. Business Data Confidentiality
Among the emotionally charged issues that the U.S. trade
community and AAEI's member companies have confronted in
today's evolving environment are the extensive and substantial
concerns regarding the confidentiality of proprietary business
data submitted to government agencies. In crafting this
testimony, we wish to recognize the committee's dedication to
preserving and even expanding individual data privacy and we
hope that the committee will recognize that for business this
is an effort which should be preserved with equal vigor.
Frankly, commercial data is property and inadequate protection
is a ``give away'' to the bad guys. We need not look far to see
a repugnant record of foreign firms and interests engaging in
grand scale industrial espionage. In trade policy terms, these
concerns are driven both by private sector competitiveness
issues and international business ownership and management. In
addition, we are deeply concerned about some Federal agencies''
dismal record of compliance with the Federal Information
Security Management Act (FISMA). We would ask that the
committee carefully examine the breadth of concerns we convey
today and support further study in this area.
The immediate issues which we ask you to consider exploring
and incorporating into your efforts are driven by several
``real world'' competitiveness concerns. Among business
community concerns are: 1) the increasing range, depth and
amount of total data that is being requested by multiple
Federal, state and local agencies often without cooperation and
certainly without integration; 2) the Federal sharing of
``sensitive'' data with an ever widening range of domestic and
international trade bodies where neither a devotion to crafting
future program requirements nor a tradition of confidentiality
(or record of advanced training programs) or have even been
apparent to the private sector; and 3) the Federal Government's
increasing reliance on unproven electronic systems to manage
confidential commercial data including product entry and risk
assessments about products based on such data.
In today's environment, we are quite concerned with the
development of policies within international bodies where
multiple U.S. data streams are provided to merge and commingle
with other Nation's data. In this we applaud recent Department
of Commerce's initiatives toward data security for the
Automated Export System (AES). In any instance, sharing of data
regarding ``risk analysis'' must be done in such a fashion so
as to avoid commercial implications as much as is humanly
possible.
Notably, it is the practice of a number of foreign
governments, which are traditional and significant U.S. trade
partners, to subsidize certain industries which compete
directly with their U.S. counterparts. In many of these
governments, both in developed and developing nations, it has
been AAEI's experience that the US tradition of data
confidentially and specific agency retention of data, is both
absent, and frankly, unwelcome. This is particularly true of a
significant number of competitive nations which have neither
sufficient customs nor enforcement capacity. Thus,
internationally, we particularly encourage the committee to
explore development of policies to address the sharing of
sensitive information with other governments, in particular
foreign customs and business promotion agencies.
In noting that a variety foreign governments have
substantially invested finances, national pride and whole
industrial development strategies in industries and specific
business enterprises that compete directly with the U.S.
private sector, we must also note that, as the committee is
well aware, significant commodity supports are found globally.
Clearly our concern here is in the impact of government
subsidies and credits among other financial commitments may
have upon the absence of appropriate prohibitions, or
regrettably the apparent ``blind eye'' to data misuse or abuse.
In addition, a significant concern here is, the apparent
lack of controls or restrictions to be imposed upon these
foreign governments by any international body on a commerce
driven mandate, particularly, as noted, those which may have a
financial interest in such a competitor to a U.S. company or
which lack important legal safeguards restricting the use and
dissemination of trade data belonging to U.S. companies
necessitate AAEI's concern. To be candid, those FDA regulated
U.S. businesses which are of interest to you today must have
firm assurances that information potentially to be supplied to
foreign governments for safety, and related, purposes would not
be used against them in a competitive business context. At
present, AAEI member companies are not sufficiently convinced
that their proprietary trade data in multiple industrial
sectors will be secure.
Allocation of Manpower and Resources--Both Direct and Through Third
Parties
Among vital areas the significant enhancement of manpower
and resources for multiple Federal, and perhaps state and
local, agencies through third parties should be carefully
considered by the committee. As noted earlier, this may be the
time to review existing FDA lack of recognition or benefit from
internal testing and controls.
We look to you, in those areas of your concern, for
potentially significant changes in the way government provides
for and otherwise supports import safety, risk management and
control and thus imports writ large. We would be happy to
discuss CBP's significant under funding and lack of sufficient
manpower in the face of expanding responsibilities, but this is
not the proper forum. In specific program terms, our experience
has demonstrated that the CBP model for gaugers and, more
recently third-party validations for C-TPAT certified
partners'' shipments from China, may prove useful to the
committee along with the Environmental Protection Agency's
long-standing program of licensed importers and Coast Guard's
periodic regulatory inspections. AAEI believes that a
fundamental element in the design of such systems must be the
economic impact upon small and medium size enterprises.
However, the overall impact upon small businesses nationwide;
of implementing multiple trade-related approaches to enhanced
product safety is subject to the unforgiving rule of unintended
consequences. ``To do no harm'' is a difficult mission when,
even for a vital purpose, modifying long-established
importation and distribution patterns and requirements will be
part of the mission. It is indeed necessary, but the committee
may wish to explore the use of an incremental approach.
Concerns with H.R. 3610
AAEI's testimony on specific provisions of H.R. 3610
touches upon the following seven topics: 1. Inspection at Port
of Entry; 2. User Fee on Imported Food and Drugs; 3. Restricted
Ports of Entry; 4. Country of Origin Labeling; 5. Safe and
Secure Food Importation Programs; 6. Penalties; and 7. Recall
Authority; and 8. Inspections.
1. Section 2--Inspection at Port of Entry
We believe that emphasis on inspection at the border goes
against the current administrations ``push out the border''
policy that has been embraced by Congress with respect to trade
security and must be considered in development of this approach
to food safety. However, those amendments which have already
been suggested to simply adopt the pattern of current homeland
security policy, i.e. to push the borders back- to foreign soil
is problematic in foods. It is our belief that to prevent any
or all FDA regulated product from ever being loaded into U.S.
bound containers- to certify the safety of products- has huge
supply chain implications for customer access and pricing.
In addition, though we are not experienced in USDA matters,
we certainly appreciate the value of their current system of
labs and import safety. However despite this appreciation,, we
suggest that trying to take a limited volume and scope
``system'' which works well for certain kinds of goods and
apply it across the board, sends U.S. policy in altogether new
directions. As we will discuss shortly, we find a number of
these possible directions problematic.
1. Sections 3 and 4--User Fee on Food and Drugs
AAEI is concerned about this proposed user fee on imported
food for the following four reasons:
AAEI is opposed to user fees levied against the retail
community and other importers when we know that global trade
has a positive effect on the United States as a whole. We
believe that both existing user fees imposed upon certain
commodities (such as medical devices) and future fees under
consideration are problematic. We consider that their impact
frequently appears to be the kind of unequal burden created
when the government agency in procurement or resource
allocation among others chooses to treat products differently.
The assessment of fees (or tariffs) upon retailers and
importers of only specified commodities is said to limit the
opportunities to cost effectively bringi9ng in goods of all
genres. Frankly though this witness is certainly not an expert
on fees versus tax policy it has been our analysis that such
fees can unfairly burden certain industries, commodities and
communities. Here we note disparate treatment of food and
drugs, which are already highly regulated commodities.
It is our observation that the disparate treatment of
imported product safety and domestic product safety is highly
problematic in terms of U.S. industry's ability to trade
internationally. To prevent serious, unnecessary damage to our
huge export economy, U.S. interests must be understood in
today's complex WTO environment and our growing framework of
trade agreements. With the enormous degree of international
competition in food commodity production already facing our
companies and industries, we are extremely concerned, as noted
earlier, that reciprocal actions, particularly in countries
with our U.S. traditions of fair trade, could prove very
difficult trade barriers to overcome.
From conversations with our retailer members, it is our
impression that fees assessed per line item will
disproportionately impact small and medium enterprises (SME's),
particularly those that import a wide variety of products
currently regulated under the Food Drug and Cosmetics Act. We
are informed that these would, as one example, specifically
impact, specialty food retailers who may cater to traditional
``geographically'' based consumers. However, we believe that
such data is not yet available and anecdotal evidence is all
that we can rely upon at this point.
The possibility exists that the fee amount per line item
may actually exceed the value of the good. In this case,
importation of the product is likely to dry up regardless of
the lack of any domestic production. This diminishes the value
of our global economic power in directly benefiting the
American consumer and penalizes importers who currently provide
low cost food to the average American household.
One fine example of this has been provided by an allied
trade association in which they pointed out that( MR I think
that here we can just Insert NCBFFA Mexico example
2. Section 4--User Fee on Imported Drug
a. AAEI is concerned about this proposed user fee on
imported drugs for the following four reasons:
AAEI is opposed to user fees levied against importers when
we know that global trade has a positive effect on the United
States as a whole. Again, this witness is not expert in the
arena of fees assessed.
However, to prevent serious, unnecessary damage to our huge
export economy, U.S. interests must be understood in today's
complex WTO environment and our growing framework of trade
agreements. Prominent among these have been both the nature of
the assessment (tax on value) and constitutional limitations
(tax on exports). Frankly, from our preliminary review, it
appears that each of the methods commonly discussed does appear
to require extensive review so as to avoid unanticipated
economic and trade repercussions. To assist in this effort, we
suggest that the committee consider an annual report of all
such revenue collected from the spectrum of Federal customs-
related fees and their allocation in the budget would be of
value to the committee.
The possibility exists that the fee amount per line item
may actually exceed the value of the good. This diminishes the
value that our global economy has the power to bring to the
American consumer and appears to penalize importers who provide
low cost food and drugs to the working class families and
senior citizens who live on a fixed income. As referenced
earlier in this testimony, the impact upon specific niche but
very important marketplaces could be profound.
It is our understanding that utilization of user fees to
pay for government programs and projects reportedly undertaken
in the public good, rather than applying primarily or
exclusively for the benefit of a specific and defined set of
users, would be a significant departure from widely accepted
policies. It appears to us that it is simply a tax imposed upon
this segment of American industry. Yes, we as a Nation need to
gather the resources required, but this is not the way to do
it. From our perspective, it is highly prejudicial against
imports, falls disproportionately on a variety of industries
and impacts most heavily on the ultimate U.S. consumer.
3. Section 5--Restrict Ports of Entry
AAEI believes that restricting ports for entry of food is
an unwise choice because our industries trade and logistics
providers must always be prepared to adjust to the dynamic
economic environment. In fact, any major corporation's supply
chain team can provide you with--virtually on demand--multiple
alternate methods and location of delivery with minimal product
cost or availability implications. In fact, we all need to keep
in the front of our minds the all too real possibility that any
number of occurrences (i.e., natural disasters, labor strikes
or terrorist attacks) could cripple any one of our major ports
for weeks or months. Under this proposal, if that port or
ports, since many are located in relative proximity, in the
case of natural disasters among other factors were to be closed
the options available are markedly reduced and the impacts,
while negative, are highly unpredictable.
In a global environment, it is unwise to place
insurmountable restrictions on either specific imported
products or individual ports due to the need to maximize the
limited remaining flexibility that still exists in the US
trades overcrowded and aging infrastructure.
For Example, as noted above, if an incident of any kind
occurs, it will be extremely difficult to adjust the import
clearance and distribution of food product in a timely manner.
The lack of pathways, in our current and emerging multimodal
environment will restrict the flow of necessary food items to
localities that need such products and will inevitably create a
backlog in processing shipments through food specific imports.
Today, such adjustments for multiple perishable and time
sensitive products are routine and often occur overnight.
With respect to the food industry, both a necessity and
highly perishable commodity, this is a very dangerous shackle
to burden our country with at a time when the need might be at
a crescendo. Industry's ability to adjust current import and
distribution methodologies in the event of an incident is an
essential and highly supported element of today's Homeland
Security Strategic planning at the Federal, state and local
levels. We would urge members of the committee to consult with
those local and state officials most familiar with these
concerns to fully evaluate the repercussions.
It is our understanding that application of the USDA
restricted port model for individual product imports, food and
otherwise, would mean, in very simple terms, that specified
kinds of products can only be imported and distributed through
certain ports--both land and sea. The impact upon the 50 states
and literally hundreds of ports, out of roughly 300, can only
be calculated with full understanding of the consequences of
economic dislocation in Congressional districts nationwide as
well as the anticipatable impact upon land ports along either
border. It is important to note that the Congress has, since
the Second World War, repeatedly resisted such plans for
multiple products and industries. It is our experience that, to
date, proposals of such policy for multiple product and
industry imports have often been offered by those whose primary
concern would appear to ease and simplicity of government
processing without equal regard for economic impact.
Under such a proposal the added logistical costs for an
importer, even assuming that nothing catastrophic occurs, can
be prohibitive particularly when--as is very common in this
country--a product enters a given port, is transported to a
second relatively convenient location for packaging or
modification and then delivered to a third perhaps distant
market for final distribution and consumption. The implications
for the small and medium business owner unable to compete with
the large retailers for inexpensive product would be
substantial. In terms of industry, as we know there are
multiple highly competitive pharmaceutical and food products
where profits, under normal circumstances may range for one to
four percent. The impact upon these, often generic or house
brand products could be highly problematic, if not prohibitive,
based upon location of established facilities and long term
distribution patterns.
As noted earlier, the reported over-crowding, current
massive infrastructure requirements and highly limited
expansion or even rebuilding of a number of the ports specified
has another side to it. Here, we must be concerned about the
impact upon those areas where labs currently exist or where one
of a limited number may be added. As noted, we are looking at
the immediate need for substantial infrastructure costs--
official structures, roads, tracks, additional docks and many
other elements. We are facing immediate and significant
congestion and citizen disruption in that virtually all of
these ports are contained with major metropolitan areas. We are
also looking at potentially substantial overall environmental
impact and quality of life concerns. To understand this, we ask
that you simply note the enormous volume of product where, at
the largest ports, of which these are, roughly 20,000
containers arrive a day. With total current national meat,
poultry and egg importation of 2.6 million containers a year
being absolutely dwarfed by projected totals coming through
each of these ports.
Among many, one particular example of definite concern to
the import community would be the Port of Los Angeles. Here the
infrastructure requirements, increased congestion and
projected, environmental disruption would obviously be of
lifestyle concern to those citizen groups and policy leaders
already actively engaged in operations and planning.
I would like to note, finally, one additional item which
may be of interest to the committee. In conversations with some
of our historically minded members I am reminded that, when it
was first discussed here in the late 1700s, this concept,
apparently known as ``Port Goods Selection'', might have been a
viable option when there were fewer ports around the country, a
dearth of well established industries at highly diverse
locations and far less global trade flowing through interior
ports,. However they suggest that it is certainly not feasible
for 2007.
4. Section 6--Country of Origin Labeling
AAEI is concerned with the burden being placed on the trade
with respect to the further development of multiple agency
Country of Origin rules. This is, for instance, evident with
respect to CBP and FDA. Today's situation can be roughly
described as CBP being harmonized internationally though the
WTO and multiple FTA's and FDA having an independently
developed and implemented system that lacks even a nexus of
compatibility or overlap with CBP's regulatory regime.
5. Section 7--Safe and Secure Food Importation Program
AAEI wholeheartedly supports voluntary programs for
security and safety, and was an enthusiastic participant in the
development of C-TPAT. As a result, AAEI would, in terms of
trade facilitation and security concerns, be pleased to both
support and assist in the development of voluntary programs for
product safety. However, such a program should be based on risk
management principles that are compatible with and enhance both
the current and future food security programs.
Foreign exporters of product to the U.S. utilizing non-
performance of voluntary standards as a competitive tool
against U.S. manufacturers who do adhere to these essential
standards--pose a growing problem which must be firmly and
quickly addressed. While complex legal issues will arise, the
idea that ``voluntary'' means that any one player, by virtue of
geography, doesn't have to pay attention to them is just plain
wrong. Equally, the merits of our current system permitting
export of U.S. made products failing to meet domestic agency
safety standards will need to be fully explored and addressed.
The committee should be aware of the enormous
complexities, as well as range of other the difficulties, that
AAEI members have encountered in dealing with the multiple
Federal agencies whose regulatory jurisdiction and oversight
for certain imported goods overlap with other Federal agencies.
As mentioned, our member companies have been at the forefront
of cooperating with CBP by joining its trade security and trade
facilitation partnership initiatives, such as C-TPAT and the
Importer Self-Assessment (ISA) Program. We believe that these
programs have a valuable role in achieving AAEI's often stated
goal of a productive balance between trade security and trade
facilitation, which AAEI believes will be achieved on
regulatory issues only when Federal agencies work in close
partnership with one another and the U.S. trade community.
Regretably, today, many AAEI member companies tell us that
they do not receive the full benefit of these partnership
programs because they are indeed regulated by multiple Federal
agencies that neither recognize nor accept the risk-based
methodologies of existing partnership programs. They continue
to face the kind of d hurdles which should be a thing of the
past in today's security environment. Such reluctance affects
nearly 36 percent of the entries for imported goods that are
subject to the ``release and hold'' authority of the U.S. Food
and Drug Administration (FDA), the U.S. Department of
Agriculture (USDA), and the U.S. Fish and Wildlife Service
(FWS), which are the primary Federal agencies that impact most
of our members potentially impacted by the current proposals.
As you can see the Congress' design for ``One Face at the
Border'' was well founded and based upon concerns to serve
land, air and sea port traders with full and equal rights. If
successfully implemented it should, and hopefully will,
eliminate much of the perceived inequities which have been
reported in the past.
In this pursuit, AAEI has worked closely with the Congress
and has spearheaded private sector efforts to initiate and
develop a dialogue and working relationship with these other
Federal agencies. AAEI is particularly pleased that the earlier
referenced industry dialogue with FDA has resulted in some
recent initial successes. Most notably, AAEI has provided
comments to FDA on its Secure Supply Chain Pilot Program which
builds upon the investment U.S. companies have made in C-TPAT
since FDA's program requires applicants to be C-TPAT certified
at Tier 2 or higher.
In the same vein, we are also working with FDA concerning
possible adoption of proven and practical risk-based
methodologies. One which we believe is worthy of consideration,
as a purely voluntary element, is the Importer Self-Assessment
program where the foundation of the ISA program is CBP's
finding that U.S. companies which have good internal controls
are highly compliant with U.S. customs laws. It is AAEI's
experience that ISA member companies are pro-active in meeting
their compliance responsibilities for all Federal regulatory
agencies, not just customs. However, as with other items
mentioned, making this program mandatory would have difficult
impacts upon the competitiveness of small and medium sized
enterprises. Overall, AAEI believes that the committee's
interest in FDA and CBP coordination is an important step
toward encouraging coordination and integration of other
Federal regulatory agencies in maintaining and demonstrably
enhancing our efficient and reliable import process.
Section 8--Penalties
Again this is not an area where AAEI has specific
expertise but we comment based upon the strong belief of our
members that significantly increased and burdensome monetary
penalties levied against manufacturers and importers will do
little in today's international marketplace to effect change
and enhance product safety without implementation of a firm
correlation to the level of culpability found during an
investigation. We would urge that the apparent lack of
delineation in the varieties and levels of company involvement
in the introduction of a product for introduction should be
carefully evaluated by the committee. We do not understand the
reasoning behind the apparent intent to make no differentiation
between those supply chain participants who had no reason to
know and those willing and knowingly participating companies.
We believe that the bad actors should be punished. Examples of
perhaps more useful deterrents which the committee may choose
to explore include tying the fines to certain thresholds of
negligence and/or intentional violations.
Section 10--Recall Authority
AAEI supports providing FDA with necessary recall
authority. However, as before, we cannot comment upon the
specifics of such a provision in light of our focus on import,
export and supply chain matters. Nonetheless, we are obviously
familiar with domestic distribution networks and would urge the
committee to examine the full implications of such a proposal.
It is, frankly, the velocity with which those products under
discussion move through the global supply chain from
manufacturer to often independent distribution to multiple
retail facilities and ultimately to the consumer that causes
our concern. It seems to us that today's rapid and efficient
distribution system could well place the importer in the
untenable position of chasing down every shipment transported
long after delivery to retailers and probable consumption. We
suggest that the committee may wish to recognize that FDA
regulated products often move in very different patterns than
consumer electronics or automobiles or apparel but are often
facilitated by the same players. In this regard, we ask that
you examine recall policy, a necessarily reactive remedy for
the government, with an eye toward economy wide impact.
. Section 11--Inspections
AAEI remains concerned that merely increasing random
inspections, sampling and testing of food imports will not
sufficiently enhance food safety because such actions will be
done at our borders. We suggest that there are other ways which
the committee could consider in devising solutions. In this
effort, one vital step to the ultimate goal of protecting the
American consumer from harm will likely lie in the prevention
of tainted food and drugs entering the supply chain. However,
we believe that the committee will wish to indicate that the
importer's failure to find and obtain products once released,
and not ``caught by regulators'' at entry, will not lead to
penalties upon the importer--in particular if there is no
finding of intentional distribution . Thus, something that must
be done outside the supply chain to ensure that the supply
chain does not end up as the dumping ground for any and all
catch-all provisions aimed at regulating this complex and
sensitive area of trade.
Though the committee may wish to fully explore providing
additional U.S. certification of foreign facilities, it could
choose to both augment and take advantage of the strength of
ongoing U.S. efforts to concentrate on development of
international harmonization standards. Such efforts, pursued by
both the public and private, sectors could provide a model that
the committee could use to assist the promotion of U.S. foods
and FDA regulated products.
In addition to our export interests we suggest judging the
real world impact, upon U.S. consumers. It is vital to note
that there are today tens of thousands of foreign shippers to
the U.S. which provide critical products and substantial price
competition in marketplaces nationwide. We believe that, with
the tremendous growth in multiple overseas marketplaces which
may not yet or ever choose to impose similar certification
regimes upon these very same exporters, American retailers and
the consumer could suffer a significant diminution in quality
and variety. Despite our attraction as a marketplace the
growing sophistication of worldwide consumers could have a
major impact.
During our 85 year history, AAEI has a long record of
working together with those Federal departments and agencies,
which have had jurisdiction over customs, trade policy, ports,
transportation, tariffs, security, and immigration regarding
the variety of other issues that impact the import and export
of goods and services to and from the United States. We
actively participate in multiple international forums and in
support of excellence in this arena. In this light, it is our
view that effective models for FDA and trade cooperation should
include a wide variety of private sector perspectives--
particularly those trade related organizations which have not
always been part of the current food and drug related
equations. Though independent organizations provide vital
information and perspective, one highly instructive model can
be based on the foundations of the well regarded Commercial
Operations Advisory Committee (COAC). COAC authorized under the
Federal Advisory Committee Act (FACA) is a key mechanism to
foster and encourage public and private sector interaction.
While significant aspects have evolved over time, COAC remains
extremely useful and its mission is vital to assisting CBP and
DHS craft appropriate trade security and compliance programs
that not only do not interrupt the flow of legitimate trade but
serve to facilitate trade in many ways. It is worth noting that
the operations and reach of COAC itself were significantly
enhanced in last session's passage of the SAFE Port Act and
this effort may prove helpful to the committee.
From our perspective, dedicated private sector
organizations and individuals, where appropriate, assisting FDA
and related agency consultative efforts could highly productive
and organizations can be encouraged which are specifically
devised to incorporate the breadth of private sector consumer
and trade related voices in their consideration of policy
development and implementation. In addition to these groups and
other beneficial multiple channels of communications between
the public and private sector regarding vital import safety,
trade security and trade facilitation issues for both U.S.
importer and exporters, a body comprised of private citizens
authorized under FACA to confer with FDA modeled on COAC would
be a constructive initiative. Such a COAC like body could
provide vital support and assist in making these programs both
robust and effective. We would ask the committee to examine
options and consider its options in imitating utilization of a
Federal advisory committee in the development of vital
Executive and Legislative branch coordination and direction for
these vital trade related issues.
In conclusion, we wish to thank the House Subcommittee on
Health of the Committee on Energy and Commerce for its
invitation to provide our observations, comments, and
suggestions about ``H.R. 3610, the Food and Drug Safety Import
Act.'' We greatly appreciate the committee's efforts and hope
that we can assist it to ensure that consumer confidence in our
product safety regime serves as the third leg of a stool
balanced partnership with trade facilitation and security. We
strongly believe that the committee's continued oversight and
active promotion of import safety with recognition of existing
trade security and trade facilitation programs and initiatives
can make an enormous difference.
We hope that our testimony will prove useful as the
committee considers measures to enhance FDA's capabilities in
handling imported food and drugs. AAEI looks forward to both
supporting this committee's active involvement and to
continuing our partnership with FDA in pursuit of these goals.
----------
Mr. Pallone. Thank you very much. Let me start the
questions with the panel. I wanted to start with Congressman
Dooley. I had a couple of questions I wanted to ask you, Cal.
In your testimony, you speak about GMAFPA's four pillars, one,
mandatory foreign supplier quality assurance program; two,
quality import food safety program; three, build the capacity
of foreign governments; and four, expand the capacity of FDA.
Now, when I look at Mr. Dingell's bill, some of his provisions
include, one, a new requirement that imported food meets the
same standards as domestic foods; two, a voluntary program for
companies that import food to agree to abide by specific safety
guidelines; three, significant new resources for food drug
safety via an importation fee, I mean the question I have, Cal,
is that you state that your proposal will do more to ensure the
safety and quality of imported food products and ingredients
than with the adoption of many of the provisions of the Dingell
bill, but I don't see the difference on how your plan is
superior. You want to just tell us why you think it is better
or why you think it would do more to ensure safety and quality?
Mr. Dooley. Sure. The way I would respond to that is that
the proposal that we have tabled really relies much more on
prevention than from inspection. Our assessment of Chairman
Dingell's bill is that it really is looking at how do you
enhance the level of inspection capacity and resources of the
FDA to try to enhance a level of food safety. We think that we
need to approach this by defining what the private sector can
do most effectively and complementing that with the defined
role where FDA can best utilize its resources. And so where the
Dingell proposal would rely on perhaps a certification of what
is, by FDA's testimony today, would literally be hundreds of
thousands of foreign suppliers of ingredients which we don't
think they have the capacity to do, that our approach would be
to have a partnership with the private sector where the private
sector would have to develop these mandatory supplier import
programs that would embody almost without question audits of
those facilities and those suppliers, and that would be a
private sector approach that would mitigate the need for FDA to
have to go out and certify again these literally hundreds of
thousands of facilities. And we think that would be a role that
would be more effective and certainly more pragmatic with our
approach.
Mr. Pallone. Well, you mentioned about the different models
the FDA could adopt to strengthen their efforts to regulate
food safety, but are there things your members are doing to
mirror those FDA efforts at this point?
Mr. Dooley. Well, what you find is that the reason that we
really have a limited number of food safety incidents even as
it relates to imported food products is that most importers of
products today do in fact have best practices in place that are
including the supplier audits, they do have the chain of
custody that they can account for throughout the supply chain,
do have testing protocols to ensure that there's not an
adulteration of a product. They have those practices in place,
but unfortunately there are limited number of people in the
industry that aren't deploying that same level of best
practices. What our proposal would suggest is that we need to
mandate that those best practices apply to any company that is
importing a food ingredient or food product, and they would
have to be in compliance with those guidelines and guidance
that would be developed by FDA.
Mr. Pallone. I wanted to ask you about the import user fee
because you are pretty critical of that, and you have a number
of reasons for your opposition. For example, you said user fees
are generally appropriated when the benefits accrue to
individuals or individual companies and that the benefits of
import inspections and research go to all Americans. Of course,
I don't agree with you on this because we just went through the
PDUFA process and the MDUFMA process, and it is very similar
where you have the industry paying for a user fee that
essentially helps all Americans or all consumers; and I don't
really see how a user fee on imports would be any different
than a user fee on drugs or device applications. So I guess my
question is what is your answer to that? I mean, it is no
different in my opinion. Do you think it is?
Mr. Dooley. Yes, I think it is dramatically different
because when a pharmaceutical company is working with FDA to
gain approval of a product that they are going to provide into
the marketplace, they have a proprietary interest. They get a
protection of a product that is going to have a patent
protection for a period of time which derives financial
benefits to that company who is paying that user fee. In this
case, we have no proprietary interest on what we could be
paying for, is that we are paying for basically a public good
in terms of an inspection of a food ingredient that we have no
proprietary interest in it. Even if we go in and we have a food
additive that a member company in the food industry might be
requesting that FDA approve, that food additive immediately
goes into public domain and we have no financial benefit from
that. So we think it is a dramatically different approach.
Mr. Pallone. Of course, a lot of what we just passed in
PDUFA was post-market, too. In other words, that was the big
issue, that it is not just for the approvals, a lot of what we
are doing in the new bill is post-market. I don't want to argue
with you. I mean, I do but you know where I stand.
Ms. DeWaal or Mr. Hubbard, did you want to comment on that,
and I am already over the time. I wanted to give the loyal
opposition or whatever they are the opportunity.
Mr. Hubbard. Ms. DeWaal may differ with me, Mr. Chairman,
but I was very much involved in the creation of the original
user fees for drugs in 1992. The downside has been as the drug
program has gotten wealthier, the appropriators and the
budgeteers and the OMB have seen an opportunity to cut back on
appropriations, and the problem is because the drug money had
to be kept up, based on provisions in the law, they cut it out
of foods in the field and inspectors. So the FDA has lost 1,000
people in the food safety and inspection area since PDUFA was
created.
So my fear here is that if you do this user fee, they will
find a way to use that to supplant appropriations, and we won't
be any better off for it. So, if you could find a way to
prevent that, great, but I am pessimistic about user fees.
Mr. Pallone. I understand. Ms. DeWaal?
Ms. DeWaal. Thank you. We don't have a fundamental problem
with the concept of user fees, but in this context we are very
concerned that the user fee proposal in this narrow construct
where it is only applying to one segment, the imported food,
and also there may be some restrictions in how that money is
used, it could actually distract from the important work the
committee needs to do in terms of looking at the authority. So
while we are happy to work with the committee on what the
overall structure might look like, I think it is just vitally
important that you really focus on what authorities are needed
today that will improve the safety of the products, both
domestic and imported, going to consumers tomorrow.
Mr. Pallone. Sounds like the same arguments that we heard
in PDUFA and MDUFMA, and of course, we ended up doing it anyway
because we didn't know where the money was going to otherwise
come from. Mr. Buyer?
Mr. Buyer. Thank you very much. I am focusing on the drug
side, so I apologize to the witnesses here with regard to food.
Mr. Dooley, it is good to see you again, and I appreciate your
testimony.
I will go back to our ideal, the ideal being safety and
efficacy of drugs that come into the United States through
legal means. Our challenges are these that come through illegal
means, and so I have some questions here for Messrs. Hubbard,
Kubic, and Dr. Goldhammer. There are some givens. One of the
givens is that the mail facilities are overwhelmed, that there
appears to be an inadequacy of FDA personnel and of resources
that due process is becoming extraordinarily burdensome with
regard to the 30 days; and this 30-day process or giving notice
of due process I highlighted because what I am learning here is
that the, quote, by exception of FDA policy is becoming the
rule of the day and being exploited by these counterfeiters. So
I would ask the three of you to comment on my assessment.
Mr. Hubbard. That is right, Mr. Buyer. The FDA created an
exception for compassion in cases of people who had a serious
disease and could not get the drug in the United States, a very
small number of people. These Web sites use that and say to
people, you can buy prescription drugs like Viagra or something
over the Internet using this exception from the FDA. So first
of all, that is a lie to begin with. Then the drugs arrive in
these mail facilities, thousands of packages a day. The FDA has
no place to store them. They might have the size of a high-
school locker to store things. Customs is saying, we got to
move this stuff out of here, there is more coming tomorrow; and
the FDA has the choice of either taking each package, sending a
letter to the addressee and waiting 30 days for them to explain
that the drug should come in usually unsuccessfully or just
letting it in. And unfortunately, that means they are just
letting it in, and that is a bad outcome for everybody because
people are getting all kinds of drugs from all kinds of
countries all over the world that can be counterfeit, expired,
or otherwise unsafe; and FDA really has no choice in my view
than to let it in under current law.
Mr. Buyer. So you would endorse my initiatives to have
FDA----
Mr. Hubbard. We actually proposed that when I was there.
Just give Customs the authority. If it's a pill, burn it which
is what they do for controlled substances.
Mr. Buyer. Thank you. You are right. Dr. Goldhammer?
Mr. Goldhammer. Our position on it is very simple. A
patient should only buy drugs through the normal supply chain,
and if they go on the Internet they should only buy through
verified Internet pharmacies that have been certified by
National Association and Boards of Pharmacy. We believe any
other Internet Web site is not an Internet pharmacy site, it is
simply an Internet drug seller that is trafficking in illegal
drugs.
Mr. Kubic. Your observations are entirely correct, and I
share the views expressed by my colleagues on the panel. I
would say, however, that there is another thing that needs to
be done here, and rather than try to stop the flood of these
drugs that are arriving at the mail centers on a daily basis,
which is frankly overwhelming, I think there needs to be a
refined investigative effort on a national basis to go after
the people who are really behind the Web sites. Earlier, sir,
in your statement you mentioned a specific site that the FDA
had identified. That particular investigation is ongoing, and I
won't go into a lot of details; but suffice it to say that they
are into their third Assistant U.S. Attorney who has had that
case in the particular Federal District Court, the prosecution
has not even begun. So there seems to be some rhetoric about
the importance of these things, but when it gets down to it and
cases are made and cases are presented by the FDA, their Office
of Criminal Investigations, they seem to somewhat fall by the
wayside.
Mr. Buyer. On page 6 of your testimony, you spoke about the
counterfeiting, legal diversion, products, that arrests have
decreased by 10 percent, even though we have double-digit
increases of activity. So what is your explanation of this
dissonance?
Mr. Kubic. Well, what we saw law year, for instance, is
that there was a shift of law enforcement effort. Early on in
our initial reporting, we saw a lot of arrests that were being
made at the point of sale. This is kind of a low-hanging fruit.
I mean, it doesn't take a very extensive investigation to go to
an open-air market anywhere in the world and conduct an
enforcement action. In contrast, if you are going to identify a
manufacturer of counterfeit medicines in China, you are going
to have to spend some time and effort. The private sector does
some of this with their security staffs in concert with ICE,
CBP, and the FDA. So as you look at the higher-level targets,
it will certainly take more time; and I think that is one of
the reasons why there has been a dimunization of the number of
arrests. It is in fact a reduction, but we see a different
person being arrested over the last year at least.
Mr. Buyer. Thank you, Mr. Chairman.
Mr. Pallone. Ms. DeGette.
Ms. DeGette. I guess I will try to cover food and drugs
somehow because I think we should be concerned about both of
them. So I would start by asking Mr. Kubic and if any of the
other drug representatives have anything to add. I agree with
you, I think that the counterfeit drugs are a huge problem. We
have been having a number of hearings over the years in
Oversight and Investigations Subcommittee about this issue, and
I think greater enforcement is needed but when you look at the
pictures of the vast quantities of these drugs that are coming
in through our points of entry, it almost seems like it is a
barrage that is just coming in. I am wondering if there are
independent efforts by any of your organizations to educate
consumers about what you just said which is that you should
only buy drugs from approved sites, and my other question is
how are consumers going to know what the, and maybe that is a
question for Dr. Goldhammer, what are the sites that would be
safe for them to buy drugs on the Internet from?
Mr. Goldhammer. The National Association Boards of Pharmacy
actually has a seal. I believe the acronym is ``VIPPS'' that
goes on those Internet sites that they certify.
Ms. DeGette. And how do consumers know that that is the way
they can tell that those----
Mr. Goldhammer. Well, we have been doing a number of
education campaigns over the last several years in this area.
There is a Web site BuySafeMedicines.org which we are part of.
There are a number of consumer groups that are a part of this
as well that has a lot of information. Also the Food and Drug
Administration, on their Web site has their own independent
page on safe purchasing of pharmaceuticals over the Internet.
Ms. DeGette. Well, Mr. Kubic, do you have any ideas what
else we could do?
Mr. Kubic. Sure. I could add, just to expand a little bit
on Dr. Goldhammer's comments, there is a Partnership for Safe
Medicines where anyone, any person who has got a prescription
drug medicine that they are taking can sign up for free and
they get an e-mail alert if there is in fact then an official
announcement made by the FDA about a counterfeit medicine here
in the United States.
Ms. DeGette. About how many alerts are going out every
year, do you know?
Mr. Kubic. By the FDA? I would have to defer to the FDA. I
am not quite sure of the specific number, but that would direct
a person who is taking a specific medication that has been
found to be counterfeit to that site. So, the FDA does a fine
job of alerting professionals, the doctors, pharmacists and so
forth. But the partnership is designed for the target audience
to be the person who takes the medication.
Ms. DeGette. I am wondering if any of you think it would be
a good idea for us to do an idea that Mr. Dingell and I
disagree with, but a lot of our other colleagues on this side
of the aisle agree with, which is drug reimportation. Seems to
me that it would make the problem worse. Mr. Hubbard, why don't
we hear from you?
Mr. Hubbard. Well, when I was with the FDA, we certainly
opposed reimportation because drugs that have been made here
and gone elsewhere could have been contaminated, but more
likely, they didn't really start here to begin with.
Ms. DeGette. Right.
Mr. Hubbard. So the FDA is very much opposed on safety
grounds.
Mr. Goldhammer. I think you know that is the PhRMA
physicians----
Ms. DeGette. Right. Yes, yes. I just want to turn quickly
to Ms. DeWaal and ask her a couple of questions about food
safety because as you know, I have two pieces of legislation,
one for mandatory recall and one for traceability. And you
mentioned very briefly in your testimony that the language in
the Dingell bill could be improved significantly on mandatory
recall. I am wondering if you can briefly talk about how you
think that could be improved?
Ms. DeWaal. First of all, all recalls done, both the USDA
and FDA, are voluntary; and one of the problems we are finding
in that system is actually getting information into the hands
of consumers who need it. So we would have specific proposals
to actually extend that portion of the bill down to the
consumer level to ensure they get effective recall notice. But
also Congresswoman DeGette, I think your issue of traceability
is also vital here. To have an effective recall, we need to
know where that food went, and in a recent recall actually that
the FDA handled, it wasn't effective down at the retail store
level, and they had to actually send out otherwise fully
employed food, drug, and medical device inspectors to retail
stores to pull back cans of foods that may have contained
botulism.
Ms. DeGette. And as I understand it, it is not from a food
distribution standpoint, it wouldn't be difficult to do,
traceability. You could actually do that in both the foods
under the FDA purview and the USDA purview, correct?
Ms. DeWaal. That is right. And part of a comprehensive bill
which we are urging this committee to consider, I think
traceability would be a critical element.
Ms. DeGette. Thank you. We will keep working with you on
those issues. Thank you, Mr. Chairman.
Mr. Pallone. Thank you. Before I recognize Mr. Matheson, I
know Mr. Buyer had a unanimous consent request.
Mr. Buyer. Yes, Mr. Chairman. I would move that all Members
may have 10 legislative days to ask questions for witnesses to
answer for the record and insert additional material.
Mr. Pallone. Yes, so ordered. Didn't you have a request to
include this document from the American Free Trade Association?
Mr. Matheson?
Mr. Matheson. Well, thanks, Mr. Chairman, and thanks to the
panel. I want to address first a question to my former
colleague, Mr. Dooley. It is good to see you again. As you
know, the Ways and Means Committee already had a mock markup
but the House will begin consideration of this trade agreement
with Peru, and one of the issues that has been raised in
relation to this agreement has been food safety. And I am
hoping you might be able to clarify to folks on the committee
how the standards included in the Peru free trade agreement
affect existing U.S. safety standards as well as whether this
agreement would limit the ability of the U.S. to raise food
safety standards.
Mr. Dooley. Congressman Matheson, there is nothing in the
Peru FTA agreement that would in any way pose any jeopardy to
the existing food safety regulations that we have in the United
States. And in fact, there is nothing in the Peru FTA agreement
that would preclude the United States from even developing more
stringent science-based food safety standards as long as they
applied to domestic and imported products in a similar manner.
Mr. Matheson. And beyond Peru, is it also not true that
under the WTO standards that exist today, even without a
bilateral free trade agreement, those capabilities exist for
the U.S. in dealing with any other country that is a member of
the WTO?
Mr. Dooley. That is absolutely correct.
Mr. Matheson. The next question I wanted to ask you is you
have testified that the focus of our efforts to improve food
safety ought to be placed on prevention in your words to reduce
the number of needles in the haystack. How much of this burden
should be placed on the food industry and how much should be
placed on the public sector?
Mr. Dooley. Well, I think, clearly we are going to be most
effective at one that is a partnership, but it is clearly the
private sector that can make the biggest difference. And what
we are suggesting that if we really are objective and we look
at the scope of this problem, the vast majority of our food
products are safe, those that are imported as well as domestic.
And the reason for that is that most manufacturers are
currently today deploying best practices that provide that
level of food safety. So what we are suggesting is that, there
might be some folks out there that need to change some of their
operation protocols, and why don't we work again in partnership
with FDA and the consumer groups to help develop some mandatory
guidance that would ensure that those best practices are being
deployed by anybody that is importing a food product into this
country. And then in fact we think, well, further enhance and
build upon the already safe food supply that we have today.
Where we are somewhat concerned in terms of the difference
between Congressman Dingell's approach is on relying more on an
inspection approach. People were talking today we are
inspecting 1 percent of the food that is coming into this
country. OK. So if we inspect 10 percent, is that going to give
us that much greater margin of safety? We would argue it might
help on the margins, but your greatest difference is going to
be by finding that effective partnership with the private
sector to ensure that these best practices are being put in
place.
Mr. Matheson. As I said in my opening statement, while the
issues are not completely the same, when we are talking about
the toy safety issue in another subcommittee on this committee,
we are talking about doing preventive measures back at the
source along the manufacturing chain, whereas on the food
safety, the proposed legislation seems to be focusing more on
the back end, and I think it might be healthy for us to
consider the benefits of looking at the overall supply chain. I
suspect you probably agree with that. Dr. Hollingsworth, quick
question for you. The proposed legislation seeks to give FDA
the authority to recall products. Since this would be a new
authority as I understand it for FDA, I am interested to hear
ideas on what would make recalls more effective from the
retailers' perspective.
Dr. Hollingsworth. I think from a retailers' perspective,
the biggest issue that we are challenged with is the
communication system of recalls, getting the information from
the manufacturer who is initiating the recall, whether it was
mandatory or voluntary. It is getting that information down to
the retailers so they know what products need to be recalled
and also allowing retailers to be involved in the initial
discussions. Retailers are excluded from any discussions about
possible recalls until that information is given to the media.
And so we are always trying to play catch-up on a recall. We
would like to be engaged earlier, and we are working to find
better ways to help those communications and also ways that we
can be sure that the word gets out to the customer, if in fact
they have bought that product.
Mr. Matheson. I was going to ask you, also you talked about
communication to the retailer, and I was also going to say how
does it work for communication directly to the consumer? Do you
think there are better ways in the public and private sector to
partner in this communication?
Dr. Hollingsworth. I think there are ways we can do better,
and that is one of the things that our board task force is
looking at now, having more uniformity in the announcements and
the messages so that people will understand what is being
recalled and what to do with that product.
Mr. Matheson. Mr. Chairman, I know my time expired but I
just would emphasize I think this issue of communication is one
that would merit our review of it on the committee. I think
that is a really relevant issue both communication with the
retailer and on down to the consumer level. I think that is a
healthy issue for us to discuss. I will yield back.
Mr. Pallone. Thank you. I am going to ask a couple more
questions, too, so if you want to you can. I just had two
questions of Mr. Hubbard. In your testimony you talk about
building safety into products, and you specifically cite Hazard
Analysis Critical Control Points as a model adopted by the FDA
and the Department of Agriculture in the 1960s. But given all
the recent contaminations we have had with spinach, peanut
butter, and other products, I am wondering why this model no
longer appears to be effective? What has changed exactly?
Mr. Hubbard. Well, it is not in place for those products.
It is only in place for meat and poultry at USDA and for
seafood and juice at FDA. In fact, I understand there have been
press reports that the FDA leadership requested that the
Secretary allow him to move to adopt that for produce, meaning
in February, but was denied. So, I think it has been proven
first by the industry and later by FDA regulation that the
concept of HACCP does work because it builds in safety and it
is much as Mr. Dooley was describing, you have got the people
in the supply chain now taking some responsibility rather than
putting it all on the FDA to inspect a product at the end which
has proven not to work. You don't want to rely on that
inspection at the end because it will fail. You need to have
everyone producing safe food and then letting FDA be the
regulator that comes in and verifies that folks are in fact
building safety and keeping records so that you know that they
are doing that and keeping them honest. And then you have in my
opinion a safe process.
Mr. Pallone. OK. And then the second question, in your
testimony you state that you think that reengineering our
import safety system could actually improve some of our trade
relationships, but there are Members who are looking at this
legislation, especially the import user fee, and see it as a
possible trade barrier. Can you elaborate on why you think this
may be good for trade?
Mr. Hubbard. Well, let us take the case of China. They have
been hit pretty hard by this. They produce a tremendous amount
of goods for our country. Most of it is very safe. We have got
a small problem here. One would hope that if processes are in
place that say to the producers in China, produce safer food,
then the overall Chinese export economy will improve. I am told
by experts on China and a number of them that the Chinese
Government does not have the wherewithal to assure the safety
of exports to us, that they don't have the reach into the
hinterlands of China, they don't have the regulatory structure.
It could take years to develop such a thing. So if by putting
into place the preventative system we are talking about to have
the Chinese producers producing safer food, the sense I get is
the Chinese Government would say we win in that because then
products coming out of China are safer products. And then they
have a better reputation in the world market. I would defer to
a trade expert on that, but I would argue that in the end they
win, too.
Mr. Pallone. OK. Thank you. Did you want to ask anything
else? All right. Let me just remind everybody that Members may
submit additional questions for the record to be answered by
all of you, and those questions should be submitted to the
clerk within the next 10 days, and then the clerk will notify
you if we have any. And again, I just want to thank you all. I
know it has been a long day here with the interruptions from
the floor, but that is the way things go. Mr. Dooley is
certainly familiar with it. And without objection, this meeting
of the subcommittee is adjourned.
[Whereupon, at 3:40 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
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Statement of American Free Trade Association
The American Free Trade Association (AFTA) is a trade
association of importers, distributors and wholesalers
providing American consumers throughout the country with
alternative sources of brand name, genuine and unadulterated
food products. AFTA appreciates the opportunity to provide the
Health Subcommittee with its comments and testimony in response
to Congressman Dingell's introduction of H.R. 3610, the Food
and Drug Import Safety Act of 2007.
Members of the American Free Trade Association applaud all
efforts to ensure the safety and integrity of the domestic
supply of foods and drugs. AFTA believes (i) that American
consumers must know that the products entering this country are
safe for their children, safe for their pets and safe to enter
the commercial marketplace; (ii) that American consumers must
be able to continue enjoying the benefits of a competitive
global marketplace--one that thrives because of the successful
relationship forged between product safety, trade facilitation
and supply chain integrity; and (iii) that any legislative
initiative intended to ensure the health and safety of American
consumers do so in a manner encouraging continued viability of
lawful small and medium sized importers and distributors. H.R.
3610 is an important step forward in our country's efforts to
protect its citizens from harmful food and drug imports. AFTA
looks forward to working with the bill's sponsors to ensure
that the legislation is made even stronger and is even better
able to reflect the symbiotic needs of consumers, the industry
and the government.
In light of the foregoing, AFTA is pleased to offer the
following specific comments to the proposed legislation
included within the Food and Drug Import Safety Act of 2007.
Section 2: Research on Testing Techniques
Testing food imports at ports of entry to determine
product safety and ensure no adulteration of food products
within 60 minutes of arrival is a laudable goal. However, this
idealistic objective must be tempered with the practical
realization that not all food shipments will be able to undergo
such testing without risking loss of product integrity and
without the creation of substantial, additional and very
expensive infrastructure capabilities that do not presently
exist. As Congress is already aware, earlier this year, the FDA
had announced its intention to close at least half of its
existing laboratories due to lack of use and deterioration.
Although that decision has since been suspended, the reasons
for the initial announcement cannot be forgotten. FDA lacks the
resources, human and financial, to carry out the functions and
operations even of its existing laboratory facilities. To
undertake research hoping to develop additional and more
stringent testing protocols than currently exist before
``fixing'' the Agency's current problems may be, respectively,
premature and not the best utilization of current and
anticipated agency resources.
Even in today's commercial environment in which sampling
of less than 1 percent of food shipments occurs, more and more
importers--large and small--complain loudly of unnecessary
entry delays and port congestion. Even if user fees were to be
assessed (which we do not believe should occur), even if the
FDA was required to maintain its current roster of
laboratories, even if Congress appropriated substantial
additional resources to facilitate such port level testing, the
port congestion and entry delays resulting from required port
of entry testing of all food shipments would measurably and
painfully disrupt the distribution of critical food supplies
into the American marketplace.
In light of the foregoing, AFTA urges the Secretary to
consult comprehensively and often with affected industry and
trade associations such as the American Free Trade Association
as it researches and develops appropriate testing methods to
prevent entry of intentionally adulterated imported food
product. This type of industry-based consultation and
collaborative effort is the only means for the Agency to ensure
that its research consider both the needs and mandates of the
government agencies, as well as the practical business
realities of the importing trade community.
Sections 3 and 4: User Fees for Food and Drugs
The FDA is charged with protecting the American consumers
from unsafe products. The funding required for the agency to
carry out its mission should be legislatively appropriated and
not passed onto American importing companies and traders, the
majority of whom are small and medium sized businesses already
suffering from the decreased value of the American dollar and
increased global competition. Food safety efforts are intended
to benefit all residents and visitors in the United States, and
the costs to assure food safety is most appropriately born by
that broad class and not the import community. Moreover, it is
not reasonable to pass along the costs of increased product
testing and border enforcement responsibilities solely to
importers of commodities required and needed by American
consumers, especially when the problems leading to the proposed
assessment were primarily caused by parties other than domestic
importers!
Summarily and admittedly painting a picture with broad
strokes, the tainted food products giving rise to legislation
such as H.R. 3610 became adulterated at the place of
manufacture, not because of any action or inaction taken by the
importer or lawful product distributor. While it may be
reasonable to hold product manufacturers responsible for
ensuring product safety and mandating that manufacturers commit
the investment necessary to so protect American consumers from
any threats to health or safety, there is no justification to
switch this burden onto the backs of small and medium sized
importers and global traders.
H.R. 3610 proposes a $50 per line item user fee on all
shipments of food products and $1000 per line item on all
shipments of drug products. Oftentimes, this exceeds the
domestic value of that line item and collectively may easily
surpass any revenue hoped to be realized by the importer.
Importers into the United States provide American consumers
with the benefits of being a participant in the global
marketplace. It is not appropriate to tax these traders for the
privilege of doing business in their own country. To do so
would be to discourage an entire industry; to do so would be to
limit domestic supply of critical food and drug products; to do
so would be to say to the American consuming marketplace that
the only way our government can afford to protect you is to
charge you more money for your basic and critical consumer
commodities.
It is, respectfully, inappropriate and inaccurate to
represent that the only source of funding sufficient to enable
the FDA to carry out its mission of ensuring the safety of
imported food products is to assess user fees against lawful
small and medium sized importers such as those represented by
the American Free Trade Association. These traders do not
dictate product specifications nor do they contract with
overseas suppliers for processing of manufactured product.
Third party importers supply branded merchandise to American
consumers believing in the reputation and quality control
mechanisms instituted by the product manufacturer itself--- the
same beliefs held by American consumers, who have come to
depend upon AFTA's members' businesses to provide cost
effective and alternative sources of these brand name and
allegedly reputable foodstuffs.
Food and drug manufacturers and not importers should be
held responsible for any funds not legislatively allocated to
the FDA to ensure product safety. AFTA's members provide
American consumers with food products at competitive prices and
at more outlets throughout the country than those products
would otherwise be made available. If these importers and
distributors are required to add user fees to the costs of
entering these products into the country, the United States
would certainly have less and more expensive food for its
consumers. This cannot be the goal of any legislation intending
to make our country's marketplace safer or of any legislation
intended to meet the consumers' needs for safe and accessible
food products.
Section 5: Restricting the number of ports for food shipments
Imported food products serve critical needs of American
consumers throughout the country. It is impractical to limit
these imports to selective ports in metropolitan areas
surrounding existing FDA laboratories that the FDA itself
concedes are underutilized and in poor physical condition.
Moreover, the increased costs of in land transit from those
ports to ultimate customers are costs that are bound to be
passed on to consumers.
The myriad and volume of food shipments into the United
States demands that importers be provided with more than merely
a few ports in which to enter their products. The port
congestion and delays that will inevitably occur if over 10
million annual food shipments were entered through only several
U.S. ports of entry is too vast to even estimate or reasonably
contemplate.
Importantly, there are currently no FDA laboratories at
either the northern or southern border crossings. Does this
mean that all food shipments will necessarily and only be able
to enter on the east or west coasts? The United States has
major food distributors and wholesalers located on both the
Northern and Southern borders, all of whom could very well be
forced to close their doors if required to bear the increased
costs of transporting perishable foodstuffs over land from
ports hundreds of miles away. The resulting economic
catastrophe will be astronomical and will quickly surpass the
product safety crisis currently facing our country.
Section 805: Safe and Secure Food Importation Program
AFTA supports any program facilitating the identification
of low risk importers. To this end, it is critical that FDA
consult closely with industry and trade associations to make
sure that the programs instituted are practical and reflect
industry realities, bearing in mind the variety of distribution
systems supplying the domestic marketplace with safe food
products and the need to protect proprietary business
information. AFTA looks forward to being a part of this
constructive and collaborative effort.
Section 8. Civil penalties
Intentionally introducing unsafe and adulterated food
product into U.S. commerce should be severely punished in any
legislative solution intended to ensure entry of only safe
foodstuffs into the U.S. Accordingly, AFTA believes that H.R.
3610 must be appropriately amended to so reflect such a
knowledge and intent standard, as a predicate to penalties
sufficient to immediately close the doors of any small or
medium sized innocent importer or manufacturer.
The existing language in H.R. 3610 assesses penalties of
up to $1,000,000 against importers and/or manufacturers
introducing adulterated food product into interstate commerce.
Without a doubt, intentionally introducing adulterated food
into interstate commerce must be prohibited and severely
punished. However, global market realities include the
possibility that certain perishable products may become
adulterated without the importer or manufacturer's knowledge
during transit; products may contain pesticides or other
contaminants not known by the processor or the importer at the
time of product purchase. It is imperative that any provision
for civil penalties be based on the knowledge of the importer
or manufacturer that the product at issue was knowingly
adulterated with the intention to cause harm to the health or
safety of the American consumer.
As currently drafted, the contemplated civil penalties may
be assessed against ``any person who introduced into interstate
commerce'' an adulterated food article. HR. 3610 must clarify
who is actually potentially liable for these contemplated civil
penalties or the legislation will merely serve as a means for
increased litigation. For example, is it possible that a
customs broker or freight forwarder could be personally liable
for ``introducing'' adulterated food into interstate commerce
about which he or she had no direct knowledge? Does this mean
that a third party importer who purchases product from a food
wholesaler, which lawfully transacts business perhaps even in a
country ``certified'' as contemplated by this legislation, is
nevertheless personally liable if without his knowledge that
product enters U.S. commerce with a contaminant or ingredient
not known to the importer or identified to the importer at the
time of purchase? Without clarification as to financial
liability, it is reasonable to assume that no party within the
supply or distribution chain will knowingly assume any such
risk and distribution of food products within the U.S.
marketplace will literally come to a standstill. AFTA does not
believe that this is the intent of H.R. 3610 and looks forward
to working with the bill's sponsors to clarify this provision.
Section 9. Continued Operation of Field Laboratories
While certainly the FDA should be required to maintain its
current laboratory facilities and operations, even with its
existing laboratory infrastructure the Agency has not met its
burden of ensuring entry of only safe products. Accordingly,
while without a doubt the FDA should not be permitted to lessen
its current capabilities, Congress should require the Agency to
create additional laboratory facilities to expedite sampling
and laboratory analysis in order to improve the Agency's
capacity to ensure the safety of imported foods and drugs.
Section 419. Inspection and Other Standards; Applicability;
Enforcement; Certifications
The Bioterrorism Act of 2002 purported to create a system
for foreign food facility registration sufficient to ensure the
safety of the domestic food supply. To now require
certification of these same foreign food facilities because the
existing system did not, in hindsight, provide enough
assurances of product safety to the U.S. government will
certainly infuriate many U.S. trading partners and put U.S.
importers in the unenviable position of having to convince
their suppliers once again to comply with yet another new,
unique and burdensome U.S. law as a condition of market access.
Moreover, to require certification of foreign food
facilities or, in lieu thereof, to require certification of
foreign governments, while not requiring the same certification
of domestic factories or distributors is to invite unnecessary
and undesirable, WTO scrutiny into what may certainly be
perceived as a discriminatory and clearly discriminatory trade
practice. If Congress and/or the FDA encourages importer
verification of supply chain security and product safety, as it
should, and works with the industry to develop the appropriate
program guidelines and protocols, there is no basis to also
require certification of foreign shippers, which, as already
stated, will necessarily create havoc for the United States as
it seeks to act within the parameters of the global
marketplace.
The American Free Trade Association appreciates the need
to expeditiously pass Federal legislation or implement similar
regulatory initiatives satisfactorily ensuring the safety of
imported foods and drugs. AFTA also appreciates, however, the
importance of crafting legislation that not only protects
consumers' health and safety, but also guarantees consumers'
continued access to safe, unadulterated and competitively
priced food products.
AFTA looks forward to working with Congress to craft
legislation ensuring entry of unadulterated food products into
the United States and appreciates the opportunity to submit
this testimony to the esteemed subcommittee members.