[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]







     THE FUNGAL MENINGITIS OUTBREAK: COULD IT HAVE BEEN PREVENTED?

=======================================================================

                                HEARING

                               BEFORE THE

              SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             SECOND SESSION

                               __________

                           NOVEMBER 14, 2012

                               __________

                           Serial No. 112-181




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                    COMMITTEE ON ENERGY AND COMMERCE

                          FRED UPTON, Michigan
                                 Chairman

JOE BARTON, Texas                    HENRY A. WAXMAN, California
  Chairman Emeritus                    Ranking Member
CLIFF STEARNS, Florida               JOHN D. DINGELL, Michigan
ED WHITFIELD, Kentucky                 Chairman Emeritus
JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
JOSEPH R. PITTS, Pennsylvania        EDOLPHUS TOWNS, New York
MARY BONO MACK, California           FRANK PALLONE, Jr., New Jersey
GREG WALDEN, Oregon                  BOBBY L. RUSH, Illinois
LEE TERRY, Nebraska                  ANNA G. ESHOO, California
MIKE ROGERS, Michigan                ELIOT L. ENGEL, New York
SUE WILKINS MYRICK, North Carolina   GENE GREEN, Texas
  Vice Chairman                      DIANA DeGETTE, Colorado
JOHN SULLIVAN, Oklahoma              LOIS CAPPS, California
TIM MURPHY, Pennsylvania             MICHAEL F. DOYLE, Pennsylvania
MICHAEL C. BURGESS, Texas            JANICE D. SCHAKOWSKY, Illinois
MARSHA BLACKBURN, Tennessee          CHARLES A. GONZALEZ, Texas
BRIAN P. BILBRAY, California         TAMMY BALDWIN, Wisconsin
CHARLES F. BASS, New Hampshire       MIKE ROSS, Arkansas
PHIL GINGREY, Georgia                JIM MATHESON, Utah
STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
ROBERT E. LATTA, Ohio                JOHN BARROW, Georgia
CATHY McMORRIS RODGERS, Washington   DORIS O. MATSUI, California
GREGG HARPER, Mississippi            DONNA M. CHRISTENSEN, Virgin 
LEONARD LANCE, New Jersey            Islands
BILL CASSIDY, Louisiana              KATHY CASTOR, Florida
BRETT GUTHRIE, Kentucky              JOHN P. SARBANES, Maryland
PETE OLSON, Texas
DAVID B. McKINLEY, West Virginia
CORY GARDNER, Colorado
MIKE POMPEO, Kansas
ADAM KINZINGER, Illinois
H. MORGAN GRIFFITH, Virginia

                                 _____

              Subcommittee on Oversight and Investigations

                         CLIFF STEARNS, Florida
                                 Chairman
LEE TERRY, Nebraska                  DIANA DeGETTE, Colorado
SUE WILKINS MYRICK, North Carolina     Ranking Member
JOHN SULLIVAN, Oklahoma              JANICE D. SCHAKOWSKY, Illinois
TIM MURPHY, Pennsylvania             MIKE ROSS, Arkansas
MICHAEL C. BURGESS, Texas            KATHY CASTOR, Florida
MARSHA BLACKBURN, Tennessee          EDWARD J. MARKEY, Massachusetts
BRIAN P. BILBRAY, California         GENE GREEN, Texas
PHIL GINGREY, Georgia                DONNA M. CHRISTENSEN, Virgin 
STEVE SCALISE, Louisiana                 Islands
CORY GARDNER, Colorado               JOHN D. DINGELL, Michigan
H. MORGAN GRIFFITH, Virginia         HENRY A. WAXMAN, California (ex 
JOE BARTON, Texas                        officio)
FRED UPTON, Michigan (ex officio)

                                  (ii)









                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Cliff Stearns, a Representative in Congress from the State 
  of Florida, opening statement..................................     1
    Prepared statement...........................................     4
Hon. Diana DeGette, a Representative in Congress from the State 
  of Colorado, opening statement.................................     6
Hon. Edward J. Markey, a Representative in Congress from the 
  Commonwealth of Massachusetts, opening statement...............     7
Hon. Fred Upton, a Representative in Congress from the State of 
  Michigan, opening statement....................................     8
    Prepared statement...........................................    10
Hon. Joe Barton, a Representative in Congress from the State of 
  Texas, opening statement.......................................    11
    Prepared statement...........................................    12
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, opening statement...............................    13
Hon. John D. Dingell, a Representative in Congress from the State 
  of Michigan, opening statement.................................    14
Hon. H. Morgan Griffith, a Representative in Congress from the 
  Commonwealth of Virginia, opening statement....................    15
Hon. Marsha Blackburn, a Representative in Congress from the 
  State of Tennessee, opening statement..........................    15
Hon. Lee Terry, a Representative in Congress from the State of 
  Nebraska, prepared statement...................................   113

                               Witnesses

Joyce J. Lovelace, Wife of Eddie C. Lovelace.....................    17
    Prepared statement...........................................    20
Barry J. Cadden, President, Co-Owner, and Director of Pharmacy, 
  New England Compounding Center.................................    30
    Prepared statement \1\
Margaret A. Hamburg, Commissioner, Food and Drug Administration..    33
    Prepared statement...........................................    35
Lauren Smith, Interim Commissioner, Massachusetts Cepartment of 
  Public Health..................................................    51
    Prepared statement...........................................    53

                           Submitted Material

Subcommittee exhibit binder......................................   114

----------
\1\ Mr. Cadden did not present a statement for the record.

 
     THE FUNGAL MENINGITIS OUTBREAK: COULD IT HAVE BEEN PREVENTED?

                              ----------                              


                      WEDNESDAY, NOVEMBER 14, 2012

                  House of Representatives,
      Subcommittee on Oversight and Investigations,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:04 a.m., in 
room 2123, Rayburn House Office Building, Hon. Cliff Stearns 
(chairman of the subcommittee) presiding.
    Members present: Representatives Stearns, Terry, Murphy, 
Burgess, Blackburn, Gingrey, Scalise, Gardner, Griffith, 
Barton, Upton (ex officio), DeGette, Schakowsky, Castor, 
Markey, Green, Christensen, Dingell, and Waxman (ex officio).
    Also present: Representative Whitfield.
    Staff present: Sean Bunyun, Communications Director; Anita 
Bradley, Senior Policy Advisor to Chairman Emeritus; Karen 
Christian, Deputy Chief Counsel, Oversight; Debbee Keller, 
Press Secretary; Katie Novaria, Legislative Clerk; Andrew 
Powaleny, Deputy Press Secretary; Krista Rosenthall, Counsel to 
Chairman Emeritus; Alan Slobodin, Deputy Chief Counsel, 
Oversight; Peter Spencer, Professional Staff Member, Oversight; 
John Stone, Counsel, Oversight; Tom Wilbur, Staff Assistant; 
Phil Barnett, Democratic Staff Director; Tiffany Benjamin, 
Democratic Senior Counsel; Stacia Cardille, Democratic Deputy 
Chief Counsel; Brian Cohen, Democratic Investigations Staff 
Director and Senior Policy Advisor; Eric Flamm, Democratic FDA 
Detailee; Kiren Gopal, Democratic Counsel; Elizabeth Letter, 
Democratic Assistant Press Secretary; Karen Nelson, Democratic 
Deputy Committee Staff Director, Health; Stephen Salsbury, 
Democratic Staff Assistant; Rachel Sher, Democratic Senior 
Counsel; Roger Sherman, Democratic Chief Counsel.

 OPENING STATEMENT OF HON. CLIFF STEARNS, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF FLORIDA

    Mr. Stearns. Good morning everybody, and the committee will 
come to order.
    My colleagues, we convene this hearing of the Oversight and 
Investigations Subcommittee to examine the recent outbreak of 
fungal meningitis linked to contaminated products made by the 
New England Compounding Center, or NECC.
    I want to extend my deepest condolences to everyone who has 
lost a loved one in this tragedy. Thirty-two people have died, 
including three within my congressional district, one in Marion 
County. One of the persons lived right up the street from me. 
And well over 400 people have been sickened, making this one of 
the worst public health disasters ever caused by a contaminated 
drug in this country.
    After a tragedy like this, the first question we all ask 
is, Could this have been prevented? After an examination of 
documents produced by the Massachusetts Board of Pharmacy and 
the U.S. Food and Drug Administration, the answer appears to be 
yes.
    Before this outbreak, FDA had conducted three series of 
inspections of NECC, each based on a separate set of 
allegations or events. The Massachusetts Board of Pharmacy's 
history with NECC is even more extensive, involving at least 12 
separate complaints concerning NECC or its pharmacist, Mr. 
Cadden, since NECC opened in 1998.
    Over the course of these inspections, regulators noted the 
same kinds of problems at issue in the current outbreak, 
problems with sterility in violation of its own license. For 
example, back in 2002, several adverse events were reported to 
FDA involving patients who had received steroid injections made 
by the NECC. FDA followed up and inspected the company. Just 6 
months after that inspection, patients were again hospitalized 
after receiving NECC's injections in what case can only be seen 
as a warning, just a simple warning of things to come. The 
patients infected in 2002 displayed meningitis-like symptoms. 
The product in question was the very same product connected to 
the current outbreak. In that case, the NECC drug was 
contaminated with bacteria.
    After the 2002 meningitis cases, officials from FDA and the 
State pharmacy board met in 2003 to review NECC's conduct. Now, 
during this meeting, the FDA made a prophetic statement. The 
FDA stated that there was ``the potential for serious public 
health consequences if NECC's compounding practices, in 
particular those relating to sterile products, are not 
improved.''
    Even though FDA was clearly aware of the risks posed by 
NECC's compounding practices, the agency was simply slow to 
act. In fact, it took FDA 4 years after finding problems with 
the NECC's sterility practices and violations of the Food, Drug 
and Cosmetic Act to issue a simple warning letter. The company 
challenged the charges FDA made in the 2006 warning letter. It 
took FDA another 2 years to respond to the company's claims. 
When FDA finally responded in 2008, 6 years after the agency 
first inspected the NECC, it directed the company to correct 
the violations and warned that it would follow up with future 
inspections. But the FDA never did so. FDA didn't even follow 
up after the Colorado Board of Pharmacy notified the agency in 
2011 that the NECC was again sending its drugs to out-of-State 
hospitals without first receiving patient prescriptions. FDA 
didn't even refer this complaint to the Massachusetts board for 
follow up. We are left to wonder what would have happened if 
FDA had investigated or at least informed the Massachusetts 
Board of the Colorado of this complaint. It is possible that 
this outbreak very well might have been prevented.
    My colleagues, we are joined today by Joyce Lovelace, whose 
husband, Eddie, passed away in September. Mrs. Lovelace, we 
sincerely thank you for sharing your story with us today. I 
pledge that we will get to the bottom of this so we can ensure 
that this outbreak, things like this never ever occur again.
    We are also joined by Commissioner Hamburg of the FDA and 
Commissioner Smith of the Massachusetts Department of Public 
Health. I am interested in learning whether they think this 
outbreak could have been prevented and whether their agencies 
did enough to stop it.
    This committee has a long history of conducting bipartisan 
oversight, and this investigation is no exception. So it is my 
sincere hope that this hearing will serve and it is an 
opportunity to determine the reasons why such a history as this 
does not repeat itself.
    [The prepared statement of Mr. Stearns follows:]


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    Mr. Stearns. And with that, I give the remaining time to 
Chairman Emeritus Joe Barton.
    Mr. Barton. I think your time has expired, Mr. Chairman.
    Mr. Stearns. OK, well, then we will go to----
    Mr. Barton. If there is time at some point----
    Mr. Stearns. I think we will go to the ranking member, Ms. 
DeGette, who is recognized for 4 minutes.

 OPENING STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF COLORADO

    Ms. DeGette. Thank you very much, Mr. Chairman. And I do 
appreciate your taking the time to have this hearing on the 
very day that we return from the recess because this is such an 
important public health issue, and we are acting in a 
bipartisan way. I am also glad about that.
    The contaminated steroid injection sold by the New England 
Compounding Company have caused 438 cases of fungal meningitis 
spanning 19 States. Thirty-two people have died, and I am 
afraid that number could continue to climb.
    We have four witnesses today to help us examine how this 
could have happened, and I am very eager to hear from the FDA 
and the Massachusetts Board of Registration and Pharmacy, the 
agencies with primary regulatory authority over NECC, just how 
we got here. I want to hear from Mr. Barry Cadden about how on 
Earth his company could have been so irresponsible causing the 
deaths of so many Americans. And I'm looking forward to hearing 
from Mrs. Lovelace, who, as you heard, is the wife of one of 
the first victims in this tragedy.
    I want to join with Mr. Stearns, Mrs. Lovelace, in 
expressing my deep, deep sadness for your loss, and I really 
want to thank you today. It can't be easy.
    And Congressman Whitfield, thank you so much for 
accompanying her today. I know this is hard for you, but it is 
important.
    Mr. Chairman, the facts that we have uncovered so far in 
this investigation reveal frightening failures on multiple 
levels, and this is one of those real cases where there is a 
lot of blame to go around for a lot of people.
    Mr. Cadden repeatedly failed to ensure that NECC and its 
sister companies were following appropriate safety rules and 
guidelines. Again and again, reports of problems with the 
facility were brought to the attention of the Massachusetts 
Board of Registration and Pharmacy, which failed to act. The 
board was informed of problems, via complaints or even from its 
own inspections, in 1999, 2002, 2003, 2004 and even just this 
past summer. But somehow, NECC was able to keep its license, 
avoid significant penalties and continue its operations until 
tragedy struck all across the Nation.
    We also need to hear an explanation from the FDA. Just like 
the Massachusetts board, FDA inspectors and officials were 
repeatedly informed of problems at NECC, but the strongest 
action taken by the FDA was a warning letter sent to the 
company in 2006, a letter that appeared to have very little 
effect. The FDA tells us that they were hobbled by questions 
about whether they had the legal authority to address the 
problems at the NECC.
    If this is true, Mr. Chairman, this is a problem that 
demands this full committee's immediate attention. We need to 
clarify the Food, Drug and Cosmetics Act, which apparently 
limits the FDA's jurisdiction over compounding pharmacies, and 
we need to make sure that for these large pharmacies like this, 
that they have the ability to act and to act quickly on behalf 
of patients.
    Over 30 people have died from this meningitis outbreak 
because too many signals about the risk were missed. One of 
those signals, as the chairman said, came from my home State of 
Colorado. In 2011, the Colorado State Board of Pharmacy 
determined that NECC was distributing unlicensed and 
unregistered drugs in the State and issued a cease-and-desist 
order. But this was not all the Colorado officials could do, 
and it was not enough to stop NECC's action. Colorado officials 
notified the Massachusetts Board of Pharmacy, and Massachusetts 
did nothing. The Colorado Board of Pharmacy did the right 
thing, but the system failed. NECC did not improve its 
operation. The FDA did not act. And Massachusetts did not act.
    Now, Mr. Chairman, for a long time, we have all had sort of 
a Norman Rockwell vision of the pharmacists who manufacture the 
drugs our families rely on, the kindly old gentleman in the 
white coat in the back of the store mixing the prescriptions 
for the little child with the illness. Unfortunately, this 
tragedy makes clear that large corporate compounding pharmacies 
are operating unchecked by appropriate safeguards, even as 
American families trust their lives. So we need to work 
together now, Mr. Chairman, to make sure this crisis is not 
repeated. And I will yield the remainder of my time to Mr. 
Markey from Massachusetts.

OPENING STATEMENT OF HON. EDWARD J. MARKEY, A REPRESENTATIVE IN 
        CONGRESS FROM THE COMMONWEALTH OF MASSACHUSETTS

    Mr. Markey. I thank the gentlelady.
    New England Compounding Center is in my district in 
Framingham. My deepest condolences go to all victims and their 
families.
    NECC was no stranger to Federal and State regulators. It 
had been the subject of eerily similar safety complaints in 
1999, 2001 and 2002. Yet, in 2002, NECC's owner, Barry Cadden 
was appointed to the State's task force charged with developing 
new regulations for compounding pharmacies. And in June of 
2006, the State board waived sanctions.
    My report, which I have completed on this issue, shows that 
even before the current outbreak there were at least 23 deaths, 
86 serious injuries associated with unsafe compounding pharmacy 
practices.
    To Jerry Cohen, Melanie Norwood, and Joyce Lovelace, I want 
to commit to you and to all of the victims that I will not stop 
until we make sure that these industries are safe.
    I thank you for your courage. We have to make sure that 
this never happens again.
    I yield back.
    Mr. Stearns. Thank you.
    The gentleman yields back.
    I recognize the full chair of the committee, the 
distinguished gentleman from Michigan, Mr. Upton.

   OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Upton. Thank you.
    You know, when we first began this investigation over a 
month ago, we knew that people were sick, and we knew that 
people had died and were dying due to contaminated medicine 
made by the New England Compounding Center.
    One of my constituents, too, a grandmother from Cass 
County, lost her life tragically to these contaminated drugs.
    The loss of innocent lives is tragic enough, but what makes 
this tragedy worse is the fact that it seems that these deaths 
and illnesses could have been prevented. The NECC was not 
unknown to its regulators. It was not operating under the 
shadow of darkness. The NECC plant is about a 30-minute drive 
from the FDA's New England District Office, and the FDA and 
NECC's State regulator, the Massachusetts Board of Pharmacy, 
had inspected NECC's facility a number of times since the 
company opened its doors back in 1998.
    FDA even issued a warning letter to the NECC in 2006, and 
the Massachusetts Board of Pharmacy entered into a consent 
agreement with the company that same year.
    I was stunned and angered to learn that inspection of the 
NECC by the FDA and the Massachusetts Board over 10 years ago 
identified contamination in the very same drug at issue in the 
current outbreak. The reason for that inspection? Patients had 
been hospitalized with meningitis-like symptoms. 10 years 
later, we are in the midst of an unthinkable worst-case 
scenario. The body count is growing by the day, and hundreds, 
hundreds have fallen ill. Inexcusable.
    Today we are going to hear from the Massachusetts 
Department of Public Health and the FDA about their history and 
the NECC and why they treated the company the way that they 
did. Why did State and Federal regulators feel confident that 
this company could make drugs safely after repeatedly finding 
that the company's drugs were contaminated back in 2002? After 
observing multiple violations of the Food, Drug and Cosmetic 
Act leading up to the FDA's 2006 warning letter, why did the 
agency fail to conduct a single follow-up inspection?
    The committee expects the cooperation of the FDA, the 
Massachusetts Board and the company as we try to uncover the 
facts as to ensure that this never happens again. Thirty-two 
innocent Americans have died during this outbreak, and the 
public deserves to know what went wrong. I thank Dr. Smith and 
Dr. Hamburg for agreeing to testify today. The Massachusetts 
Board in particular has provided thousands of pages of 
documents relating to the NECC.
    Thank you, Dr. Smith, for making yourself and your staff 
available to the committee. I wish I could say the same about 
the FDA.
    Commissioner Hamburg, the FDA still has not provided the 
key timeline information requested by the committee more than a 
month ago. The FDA has not provided its communications relating 
to the NECC. FDA needs to focus on protecting public health by 
cooperating with its authorizing committee. We are going to 
insist today on a firm timetable from you as to when you can 
produce those documents and the rest of the requested 
information. The sooner that the FDA cooperates, the sooner we 
can determine what went wrong and what we need to do to fix it 
so it doesn't happen again.
    Mrs. Lovelace, our hearts are with you. They really are. We 
appreciate your testimony during this very, very tough time, 
and I yield the balance of my time to Mr. Barton.
    [The prepared statement of Mr. Upton follows:]


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   OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. Barton. Thank you, Mr. Chairman.
    You have heard the old saying, you can bring a horse to 
water, but you can't make it drink. Well, you can take a 
regulator to a problem, but you can't make it regulate.
    And we have got numerous cases in the last 10 to 15 years 
of State and Federal regulators being made aware of problems at 
this particular company, and they go out and investigate, or 
they ask for documentation, and then they issue some sort of a 
general reprimand or, in some cases, do nothing at all.
    It is an absolute tragedy without any question that 32 
people have died, and it is very unlikely that that is going to 
be the end of the death toll.
    We have got to get our regulatory authority, both at the 
State and Federal level, when you have what appears to be a 
back bad actor like this company, you have got to get the 
regulators to use the authority that the States have given them 
and the Congress has given them to stop these practices.
    And if you read the reports of both the majority and the 
minority staff that was prepared for this hearing, there are 
repeated instances of where an inspector just walking through 
could see obviously contamination in the various batches of 
this particular product, and it has been going on for 10 to 15 
years.
    So I want to thank Chairman Upton and Subcommittee Chairman 
Stearns and Ranking Member Waxman and DeGette for, on a 
bipartisan basis, immediately calling for this hearing, 
immediately asking that the facts be made present, and let's 
find out what the facts are and then do what is necessary to 
put a stop to this once and for all.
    With that, Mr. Chairman, I yield back.
    [The prepared statement of Mr. Barton follows:]


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    Mr. Stearns. The gentleman yields back.
    I recognize the ranking member of the full committee, the 
gentleman from California, Mr. Waxman, for 5 minutes.

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Waxman. Thank you very much, Mr. Chairman.
    I want to thank you for holding this hearing and working 
with the Democrats in making this a bipartisan hearing. We are 
convening in the midst of an ongoing public health tragedy. The 
New England Compounding Center shipped across State lines over 
17,000 vials of a steroid, an untold number of which were 
contaminated with a dangerous fungus, these injections have so 
far killed 32 people and sickened 438 people with meningitis. 
This is a tragedy that has brought unspeakable devastation to 
so many families.
    That is why I'm very grateful, Mrs. Lovelace, for you being 
here today. It takes a lot of courage for you to come forward 
and speak about this, but it is important that you do so.
    The facts that we have learned to date are very, very 
troubling. First of all, let's not lose sight of the wrongdoer 
as we go around blaming regulators. The regulators deserve 
blame, but the primary blame, in my mind, is the company. We 
had to subpoena the former President of the NECC, Barry Cadden, 
to be here to testify about how this company handled the 
matter. And what we learned was that even 10 years ago, people 
who are regulating the company found that there were sloppy 
practices that could lead to a public health problem. In fact, 
the FDA 10 years ago knew that there could be a possible 
meningitis outbreak, and it wasn't corrected by the company.
    And the company went about its ways, I suppose always 
telling people that they are going to behave better, they are 
going to change their ways. Well, that doesn't mean we don't 
insist on regulators watching out for the public interest.
    And I am pleased that both sides of the aisle are talking 
about the need for regulation, and what we need to do is 
straighten out who has what responsibility to be sure it is 
clear.
    The Massachusetts Board of Registration and Pharmacy and 
other State regulators and health care providers identified the 
problem at the company. The Massachusetts Board inspected the 
facility after the outbreak. They found a horrifying list of 
problems, and it is shameful that those that ran this facility 
allowed this to happen.
    The Massachusetts Board had primary jurisdiction, no one 
questions, that the State had primary jurisdiction to regulate 
the company. They were informed numerous times of problems. 
They even did their own investigation identifying serious 
issues, but the board never took actions tough enough to stop 
the New England Compounding Center from putting consumers at 
risk.
    And finally, we have FDA. FDA was informed of the problems. 
They conducted investigations. They raised concerns about the 
NECC, but the most aggressive action the agency took was a 
warning letter in 2006. That letter and previous attempts by 
the FDA to inspect and review NECC's actions were met with 
stubborn refusals and a challenge to FDA's authority. Well, the 
FDA is questioning their authority. Congress acted specifically 
in 1997 to limit the authority of the FDA and there was a 
Supreme Court case that left the FDA in doubt as to exactly the 
authority it had left.
    This tragedy demands action from this Congress. Mr. Markey 
has a bill that is a good start. I think we want to work during 
this lame duck session to pass bipartisan legislation that 
preserves compounding pharmacies' abilities to operate safely 
in appropriate situations, yet gives FDA the clear and 
effective authority to prevent compounders from becoming 
dangerous drug manufacturers, like the NECC.
    Mr. Chairman, I want to yield the balance of my time to Mr. 
Dingell.
    Mr. Stearns. The gentleman from Michigan is recognized for 
the balance of the time, but with the consent, unanimous 
consent, that you could have additional 2 minutes and we have 
additional two speakers that will speak each a minute a piece 
after you, if that is by unanimous consent accepted.
    Mr. Dingell. I'm not about to make it difficult, and I do 
thank you for the courtesy, Mr. Chairman.
    Mr. Stearns. With unanimous consent, so ordered.
    And the gentleman, distinguished chairman emeritus of the 
full committee under the majority and the Dean of the House, is 
recognized 3 minutes.

OPENING STATEMENT OF HON. JOHN D. DINGELL, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF MICHIGAN

    Mr. Dingell. Mr. Chairman, I thank you for your courtesy. I 
commend you for holding this hearing, and I'm very pleased with 
the speed with which the committee has responded.
    I ask unanimous consent to revise and extend my remarks, 
and I note that my home State of Michigan leads the country in 
the number of cases related to this fungal meningitis outbreak 
with 129 patients affected and 9 deaths. These individuals and 
their families deserve answers as to how this was able to 
occur. We also need to ensure our people that the 
pharmaceuticals that they purchase are safe. It is clear that 
the New England Compounding Center, which has a long history of 
sterility issues and significant other problems, was not 
properly regulated by either Federal or State authorities and 
that the sitting on the border between of the two authorities, 
they were able to disregard their responsibilities and lead us 
into a bad situation.
    It is further clear that NECC blatantly chose not to 
address deficiencies and violations found by FDA and the 
Massachusetts Board of Pharmacy and additionally compounded 
these steroids without patient-specific prescriptions as 
required by Massachusetts State law.
    While I recognize that compounding serves an important 
public health purpose, I am concerned that NECC was operating 
at such a volume as to be outside what may properly be 
considered traditionally pharmacy compounding and may instead 
be properly classified as a drug manufacturer and engaged in 
drug manufacturing.
    Warnings were given on many occasions to all concerned, and 
we are going to have to see to it that that situation does not 
again obtain.
    I would note that we have sort of the classic system of the 
tragedy of the commons before us, where what belongs to 
everybody or more than one appears to belong to no one, and as 
a result, neither agency responsible for its actions dealt with 
the problems.
    I'm sure this committee hopes and intends to work with all 
of us together on both sides of the aisle to find out how new 
FDA authorities can address the issue before us with proper 
expansions of regulatory authority and what additional 
statutory authority may be needed to prevent future outbreaks 
like the one from which we are now suffering.
    I am fearful, Mr. Chairman, that this problem is something 
which will require fairly strong legislation, but I'm satisfied 
it is fairly easily done.
    I thank you for your courtesy to me, and I yield back the 
balance of my time.
    Mr. Stearns. I thank the distinguished gentleman and now 
recognize the gentleman from Virginia, Mr. Griffith, for 1 
minute.

OPENING STATEMENT OF HON. H. MORGAN GRIFFITH, A REPRESENTATIVE 
         IN CONGRESS FROM THE COMMONWEALTH OF VIRGINIA

    Mr. Griffith. Thank you, Mr. Chairman, and thank you so 
much for holding this hearing.
    Like so many others who have spoken, my area in the Roanoke 
Valley and the New River Valleys of Virginia have been 
particularly hard hit. We have had two fatalities, and I was on 
the phone this morning with the father of the youngest victim 
to date in the United States, a young man who just turned 16 
when he was stricken down. He has the advantages of age, but 
they don't know what his end result will be. On the Friday 
before he was stricken, he caught, as a sophomore, caught three 
interceptions in a football game, ran one back for a touchdown, 
just a great athlete, this gives him some advantages, but how 
will his life be changed? We don't know.
    Our job here is to find out why this happened and then to 
make sure that it doesn't happen again. And I look forward to 
working with everyone to make sure that we get to the bottom of 
this in a bipartisan fashion and also want to thank Mrs. 
Lovelace for being here today and express sorrow for your loss.
    With that, Mr. Chairman, I yield to Mrs. Blackburn.
    Mr. Stearns. The gentlelady from Tennessee is recognized 
for 1 minute.

OPENING STATEMENT OF HON. MARSHA BLACKBURN, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF TENNESSEE

    Mrs. Blackburn. Thank you, Mr. Chairman, I am appreciative 
of the work that you and your staff have done and the manner in 
which we have moved forward so quickly on this issue.
    And I do want to welcome our witnesses.
    And Mrs. Lovelace, we do welcome you. We are appreciative 
that you would take your time to join us.
    According to the CDC, 81 Tennesseans have been affected 
with fungal meningitis, and 13 Tennesseans have lost their 
life. This is something that is of tremendous concern to us, 
and it is because of this and on behalf of my constituents and 
those families that have been adversely impacted by this fungal 
meningitis outbreak, I am interested to hear why the FDA did 
not pursue any enforcement actions against NECC, despite having 
emphasized nearly a decade ago, nearly a decade ago, the 
potential for serious public health consequences. These are 
answers that we are looking for. They are questions that we 
have each approached during our comments, and I look forward to 
the hearing.
    I yield back.
    Mr. Stearns. The gentlelady yields back.
    We are now ready to have our first panel. Our first panel 
is Mrs. Joyce Lovelace. She is the wife of the late honorable 
Eddie C. Lovelace. Judge Lovelace served as a circuit judge for 
the 40th Judicial Circuit in Kentucky's Clinton, Cumberland and 
Monroe Counties.
    Judge Lovelace was the first confirmed death as a result of 
the fungal contamination from steroid injections.
    Before Mrs. Lovelace begins her testimony, I would like to 
recognize her congressman, the distinguished gentleman from 
Kentucky, who is also chairman of the Energy and Power 
Subcommittee and represents the First District of Kentucky, for 
an introduction of Mrs. Lovelace.
    Mr. Whitfield. Chairman Stearns, thank you very much, and 
Ranking Member DeGette and all of the members of this 
committee.
    We genuinely appreciate your being here to investigate this 
very important issue.
    I feel very fortunate to be here with Joyce Lovelace today, 
not only because she is a constituent but because, ever since I 
have been a Member of Congress, Joyce and her husband, Eddie, 
have been very good friends of mine. They lived in Albany, 
Kentucky. We talk about statistics and figures, and yet when 
you look at the individual lives involved, it makes all the 
difference in the world.
    Joyce and Eddie were married almost 56 years. He died on 
September the 17th, 2012, as a result of complications from the 
contaminated steroid injection that caused fungal meningitis 
and which is the focus of this hearing. He was 78 years old, 
but I might say that most people who met him thought he was 50 
years old because he walked 3 or 4 miles every day. He was a 
circuit judge, was one of the leading legal scholars in 
Kentucky, had also served as a chief prosecutor, a county 
attorney, and he was one of those people involved in every 
aspect of the community of Albany. So we will all miss Eddie 
Lovelace, and we will never forget him.
    And at this time, I want to thank Joyce very much for being 
willing to share her story and Eddie's story with the 
committee. And Joyce, thank you very much for being here with 
us this morning.
    Mr. Stearns. I thank my colleague for that fine 
introduction.

   STATEMENT OF JOYCE J. LOVELACE, WIFE OF EDDIE C. LOVELACE

    Mr. Stearns. Ms. Lovelace, you are aware that the committee 
is holding an investigative hearing and when doing so has had 
the practice of taking testimony under oath.
    Do you have any objection to testifying under oath?
    Mrs. Lovelace. No.
    Mr. Stearns. The chair then advises you that under the 
Rules of this House and the rules of the committee, you are 
entitled to be advised by your counsel. Do you desire to be 
advised by counsel during your testimony today?
    Mrs. Lovelace. I'm fine.
    Mr. Stearns. In that case, if you are able to stand--if 
not, then please raise your right hand, and I will swear you 
in.
    [Witness sworn.]
    Mr. Stearns. You are now under oath and subject to the 
penalties set forth in Title 18, Section 1001 of the United 
States Code. We welcome you today and your can now give your 5-
minute summary opening statement if you would.
    Mrs. Lovelace. Thank you, Mr. Chairman and members of the 
committee. I'm very much encouraged by what I have heard from 
you today, that you do plan to move on this and to investigate 
this matter. That is basically what my family and I desire, is 
to get to the bottom of this and make sure that it never 
happens to another family because we have lived a nightmare. We 
will be living this nightmare for ages to come. It is something 
that probably we will never really be able to get closure 
because it was such a useless thing that happened to my 
husband.
    I don't have any notes. My husband hated notes. Obviously, 
he can't be here, and I'm here on his behalf. So I'm just 
speaking from the heart, and I think he would not want me to 
have notes. He never read, he always spoke.
    I was fortunate enough to have been married to this amazing 
man for nearly 56 years. And I won't say that it was always 
pleasant or smooth or anything, and I don't think any marriages 
are, but we worked together in his office. We were married when 
he was in law school. And I worked and helped him make his way 
through law school, and then we moved to Albany and made our 
home there. And he immediately began to get involved in civic 
matters, community matters. He taught Sunday school 42 years. 
He was still teaching when he passed away. He was a gifted 
speaker.
    Really, I just want these people to know what kind of a 
person that has perished because of their lack of concern. My 
family is bitter. We are angry. We're heartbroken. We're 
devastated. And I just come here begging you to do something 
about the matter.
    I cannot say enough good about him. He was bigger than life 
in any setting that you put him in. And I worked in his office 
alongside of him, so I've seen all sides and have seen him 
interact with all classes of people in all situations. And he 
had a gift of working with people. He was compassionate. He 
wanted to help the people that needed it. He always wanted the 
victim in any to be taken care of and given full consideration. 
And it's ironic that he winds up the victim in this.
    Our family, I can't begin to tell you what I have lost, my 
soulmate, my partner, words don't, can't describe. Our older 
grandchildren. He was their anchor, their rock. They looked to 
him for advice. He guided the older ones through college and 
helped them decide what steps or what direction that they 
wanted to take. Our oldest granddaughter became an attorney 
based upon her appreciation I think for him and the work that 
he did. And he had 2 more years left in his term as judge. He 
planned to complete that term and go in practice with our 
granddaughter and help her get started. Now she has no one.
    Our younger grandchildren have lost the best playmate they 
ever had. He played anything that our grandchildren asked him. 
They could dress him up. They could do anything, and he was 
happy to do it. They all wanted Papaw, our youngest 
granddaughter asked him, even when gas prices were so high, and 
they still are, asked him, you drive me around Pops and let me 
just read. And he would get her in the car, and he would drive 
and let her read her books. She is now in the sixth grade, and 
she is an avid reader. But these are some of the things that we 
are going to miss.
    He had a very legal mind. He studied the law. Every 
weekend, on Friday, he wanted all the opinions of the appellate 
courts printed out and that was his weekends, reading. He would 
get kind of miffed at us if we didn't get it done because that 
would ruin his weekend.
    Now he wasn't a sick individual. He was healthy. He walked 
3 miles every morning before I would even get out of bed. He 
wanted to stay active. He didn't have the appearance of a 78-
year-old man until about the second injection, and then we 
began to see the difference, for he had walked those streets 
every morning, he was stumbling, he was losing his balance, he 
fell often. He began to have headaches, which he never had 
before. And I was really concerned at his appearance. He had 
the look of someone who might have cancer. He had a physical 
examination just maybe 2 weeks before he fell sick, before he 
became sick, and they found nothing wrong. The only problems he 
had were kidney stones and allergies, neither of which I think 
would have taken his life.
    On the 11th of September, he began to have numbness in his 
hand, and we begged him to go to the emergency room, and he 
declined. That evening, he had a bad headache, and then he told 
me that two fingers on his hand were not right. He couldn't use 
those two fingers. Then it became his fist; he couldn't. But he 
still would not go to the emergency room. He just was an 
individual that was not sick that much, and he wasn't going to 
go to doctors. He just didn't go until he had to.
    The next morning, of course, he had been up, and when I got 
up, he was hollering for me in the kitchen. He had a horrible 
look on his face. I will never forget that expression. And he 
said, my legs don't work. He said, I've been out twice to get 
my paper, and I've fallen twice. Our daughter is a nurse, and I 
called her and she took him to the emergency room.
    I believe they did a CT scan there, and it didn't show 
anything, but based on his symptoms they transferred him to the 
Vanderbilt in Nashville. To back up, he had had a car accident 
in March, the last of March and had injured his lumbar and 
cervical spine. And he had gone through his physical therapy. 
He had done everything the doctors had told him to do in an 
effort to try to get better. To be able to work was number one 
on his mind, to get back on the job. He was transferred--he was 
referred to a Dr. Abrams, a neurosurgeon at St. Thomas, and 
that's where he received these injections at the St. Thomas 
Neurosurgical Outpatient Center. They admitted him to 
Vanderbilt on the 12th. He immediately, just within a day or 
two, started declining fast, I mean rapidly. His speech became 
slurred. He lost the use, he had no grip in his left hand. He 
could not move his left foot. He had no eye-hand coordination. 
He could not feed himself. It was a nightmare to see this man 
who was perfectly healthy one moment and then just so quickly 
going downhill, and everything the doctors were doing for him 
didn't--was to no avail. The medicine, whatever they did, it 
was not helping him in the least. And he just declined so 
rapidly, that on the 17th, he passed away.
    And people, it was not an easy death that we witnessed. And 
these are human beings that these committees, the FDA, the 
NECC, whoever is responsible. I want them to know their lack of 
attention to their duties cost my husband his life, cost my 
family, caused them a loss that we will never recover from. And 
if you don't do your job, it may not appear to be anything to 
you, but you are affecting human lives, valuable human lives. 
My husband was valuable to us. And I cannot beg you enough, 
bipartisan, I don't care what party, work together----
    Mr. Stearns. We will do.
    Mrs. Lovelace. And please legislate this so no other family 
has to go through what we have.
    [The prepared statement of Mrs. Lovelace follows:]


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Mr. Stearns. Mrs. Lovelace, thank you very much for your 
poignant testimony, your statement.
    I'm just going to ask two questions, short, brief. But the 
first one is, when you found out that your husband was the 
first of many to be linked to this contaminated product 
distributed by the NECC, do you remember when that was, how 
long after he died? And secondly, who was it that informed you 
about this?
    Mrs. Lovelace. He passed away on September the 17th, and we 
went ahead with the funeral services and everything, thinking 
that he had a stroke because that was their diagnosis. On the 
third of October, I believe it was, we began to hear about the 
contamination from these injections.
    Mr. Stearns. From the press? Who told----
    Mrs. Lovelace. Yes, through the press. My son-in-law, I 
think, was the first that read it or heard it. On October the 
5th, I received a call from a reporter from the Nashville 
Tennessean, and he told me that a spokesperson at Vanderbilt 
had issued a statement that a 78-year-old man had died from the 
contaminated steroids.
    Mr. Stearns. So the first you heard about it was from the 
Vanderbilt hospital.
    Mrs. Lovelace. The first I heard that was from----
    Mr. Stearns. So no one from the FDA or the Center For 
Disease Control, did they ever contact you?
    Mrs. Lovelace. No. St. Thomas did not contact me.
    Mr. Stearns. So you actually heard about it through a press 
report?
    Mrs. Lovelace. Correct.
    Mr. Stearns. And no one from the State of Tennessee 
contacted you?
    Mrs. Lovelace. No.
    Mr. Stearns. Did they subsequently, after you heard through 
the press, did the State of Tennessee or FDA or the Centers for 
Disease Control?
    Mrs. Lovelace. I was on the Internet to try to find 
something about it, and I found a phone number on there, and I 
called it.
    Mr. Stearns. So you initiated it?
    Mrs. Lovelace. Yes.
    Mr. Stearns. No one from outside came to you?
    Mrs. Lovelace. No one.
    Mr. Stearns. Even after the press reports and the 
Vanderbilt Hospital, did the doctor call you?
    Mrs. Lovelace. No, but Vanderbilt didn't know about him 
having the injection. It was over at St. Thomas. Now, on the 
25th--and bear in mind that his funeral was the 21st--on the 
25th someone from St. Thomas called my cellphone and asked how 
Mr. Eddie was doing from his procedure. And I was really taken 
aback because we had just buried him. And I told her so. And 
well, she was so sorry; what happened? And I said, they 
believed he had a stroke. So then, the next day, a different 
lady from the same place called wanting to know what his 
symptoms were, how long he had the symptoms and whether or not 
we had an autopsy performed. And neither person mentioned 
contamination, meningitis, anything like that.
    Mr. Stearns. You know, it is a possibility what you say, a 
stroke, there might have been people that had died because of 
the contamination prior to your husband that were elderly and 
they attributed to a stroke.
    Mrs. Lovelace. It is very possible.
    Mr. Stearns. We will never know. I think my last concern 
is, is the feeling I have that you had no contact with the FDA 
and these other folks that I mentioned. I think if you, they 
did contact you, and told you about it, I think what you would 
say to them is, why didn't you stop it?
    Mrs. Lovelace. Right.
    Mr. Stearns. And obviously, if you had to talk to Mr. 
Cadden, who is the CEO of NECC, you could say, how in the world 
would you be so oblivious to the lack of quality control and 
all the notices that you got prior to your manufacturing of 
this large number of drugs? So those are the questions I want 
to ask you. I want to thank you again for your courage to come 
here, and I recognize the ranking member, Ms. DeGette from 
Colorado.
    Ms. DeGette. Thank you very much, Mr. Chairman.
    I just want to follow up, Mrs. Lovelace, on some of the 
things the chairman was saying, because when they went over to 
inspect NECC, they found vials with little black stuff in them, 
and they found insects near the areas and terrible, terrible 
working conditions. And you know, sometimes in this committee, 
we have seen this before with food manufacturers, and we all 
sit here and we say, ``How could this happen in the 21st 
century in the most civilized country in the world?'' And the 
reason why it is so important that you came today--and it is so 
hard for you, I am sure--is because it is easy for regulators 
and for Congress people to talk about this in the abstract and 
for every--for you being here, there are hundreds of people 
around the country who have either lost loved ones who were 
just as cherished to them as your husband was to you and--or 
they are sick and they are still sick.
    So I just want to let you know, it makes a big difference 
for you to come here today. And I want to thank you for doing 
it. It is not easy, I know. And I also want to let you know 
that we are--with some of the food safety issues that we 
identified a few years ago, we actually did pass legislation 
that clarified it. And so as hard as this is and how senseless 
and unnecessary as this is, I will guarantee you that I will be 
working with Mr. Upton and the entire committee, Democrats and 
Republicans, to make sure we clarify this.
    And I think one of the problems as well as just sloppiness 
on the part of the Massachusetts regulatory agency and the FDA, 
the other problem was this gray area in the compounding 
pharmaceutical law, where the FDA wasn't really sure if they 
had jurisdiction or they'd be sued in court. We can fix that, 
and I can guarantee you we will fix that. And when we do fix 
that, unlike these regulators, we will call you and let you 
know.
    So thank you very much for coming, and I yield back the 
balance of my time.
    Mr. Stearns. The gentlelady yields.
    We will open the floor for additional questions. Just to 
remind members the second panel is Barry Cadden, who is the CEO 
of NECC, as well as we have the third panel.
    So would anyone like to ask a question? Mr. Burgess is 
recognized from Texas.
    Mr. Burgess. Thank you, Mr. Chairman.
    And Mrs. Lovelace, I do appreciate your being here and 
sharing your story with us. You made the comment that your 
husband was important to your family. I just stress that he is 
important to this committee as well.
    And just like the ranking member, when she was talking 
about some of the food safety investigation, we have done, your 
story, as you were relating it, was just so similar to, in this 
very room, maybe 2 years ago, we heard a similar story about 
salmonella, and the family actually learned about it, that the 
lost of their loved one, they learned about it through the 
newspaper that maybe it was the tomatoes in the salad or 
wherever the contaminant was from and the same thing, the place 
where things were grown, there were obvious areas where there 
was contamination going on.
    We have read the memos, and we understand the litany of 
problems that existed at this manufacturer.
    Can I just ask you a couple of questions to clarify in my 
mind the timeline that the clinical course that your husband 
had? He had the automobile accident, and roughly when was that?
    Mrs. Lovelace. March 30th of this year.
    Mr. Burgess. And then his treatment at the outpatient 
facility for the steroid injections, he had two of those.
    Mrs. Lovelace. Three.
    Mr. Burgess. Three. And so I guess the last one would have 
occurred when?
    Mrs. Lovelace. August 31st.
    Mr. Burgess. And his illness began.
    Mrs. Lovelace. The 11th, it really began before, but it was 
really magnified on the 11th.
    Mr. Burgess. So roughly not quite 2 weeks afterwards.
    Mrs. Lovelace. Uh-huh.
    Mr. Burgess. And when he was admitted to the hospital, when 
was transferred to Vanderbilt, when did that occur?
    Mrs. Lovelace. That was on the 12th, the morning of the 
12th.
    Mr. Burgess. So he had a pretty rapid decline in his 
clinical course.
    Mrs. Lovelace. He did.
    Mr. Burgess. Did the doctors know in, coming into 
Vanderbilt, that he had had previous outpatient therapy at the 
other facility?
    Mrs. Lovelace. No, I don't believe they did. Our daughter 
accompanied him to the hospital, and I don't believe that that 
was in his history when he was admitted.
    Mr. Burgess. It may not have occurred to anyone to ask, and 
obviously, now, in retrospect, this all becomes very 
intertwined. This is tough, what you have been through; we 
don't have an opportunity to talk to them, but I suspect it is 
tough for the doctors involved as well----
    Mrs. Lovelace. I am sure it is.
    Mr. Burgess. For the doctors that provided the steroid 
injection, as well as the doctors that were treating, not 
knowing what they were up against.
    Mrs. Lovelace. I am amazed that they were ordering medicine 
from someone that had that reputation.
    Mr. Burgess. That is part of our problem, that information 
may not have gotten to where it needed to get.
    Well, again, we appreciate your courage and your strength 
for being here, relating it to us today. It is an important 
part of this story, and I certainly look forward to what we can 
do for you in the future. Thank you.
    Mrs. Lovelace. Thank you very much.
    Mr. Stearns. Anyone else who wishes to ask a question? 
Anyone on this side? Short question.
    Mr. Murphy. Just a short comment here. I thank you for 
being here because of the statement you made about the 
importance of the organizations involved that are supposed to 
be inspecting. Clearly, there is a lot of information that they 
knew that this compounding pharmacy had problems. And whatever 
the issue was, as you are keenly aware, surely you have 
searched so many times, how could someone stop and say, it is 
not my job, it is not in my job description, it doesn't matter? 
It is so important that you hear--and I am sure it is 
difficult, I am sure it is tragic--but it is still, I thank you 
for having the energy for being here and help people put a face 
on this. There is a role of these agencies, and at no time 
should ever someone say, this is a gray area, I don't want to 
overstep the boundaries, because the fact that people did that 
ended up in a tragic loss. So I thank you for having the 
courage to be here and helping to put a face on it.
    Mr. Stearns. I thank the gentleman.
    And with that, Mrs. Lovelace, thank you very much for your 
testimony.
    Mrs. Lovelace. You are welcome.
    Mr. Stearns. And we thank our colleague Mr. Whitfield for 
his time, too.
    And with that, we will call up the second panel.
    Mr. Cadden is asked to come to the desk.
    Mr. Cadden, my understanding is that Mr. Cadden authorized 
his counsel to advise the committee that he will rely on his 
Constitutional right not to testify at today's hearing. I 
believe that this privilege should be personally exercised 
before the members as we have done in the past, and that is why 
we have requested that he appear today before us.
    I request that, given the importance of his testimony, he 
reconsider his decision to invoke his Fifth Amendment rights, 
especially because the families of the people who have lost 
their lives after receiving a contaminated injection made by 
his company, the New England Compounding Center, those who are 
sick and those who have received injections, are waiting to see 
if they, too, will get sick, they deserve some answers today.
    Mr. Cadden, I ask you to consider, to reconsider and tell 
this committee and the people watching this hearing how this 
tragedy has happened.

STATEMENT OF BARRY J. CADDEN, PRESIDENT, CO-OWNER AND DIRECTOR 
          OF PHARMACY, NEW ENGLAND COMPOUNDING CENTER

    Mr. Stearns. Mr. Cadden, are you aware that the 
subcommittee is holding this investigative hearing and, in 
doing so, we have the practice of taking testimony under oath?
    Mr. Cadden. On advise of counsel, I respectfully decline to 
answer on the basis of my Constitutional right----
    Mr. Stearns. First of all, Mr. Cadden, you just need a yes 
or no for this question.
    Mr. Terry. Put the microphone on.
    Mr. Stearns. Put your microphone on. So we are just asking 
you basically, you understand we have the practice of taking 
testimony under oath. You understand that. And do you have any 
objection to testifying under oath?
    Mr. Cadden. No.
    Mr. Stearns. The chair also advises you that, under the 
Rules of the House and the rules of the committee, you are 
entitled to be advised by counsel. Do you desire to be advised 
by counsel during your testimony today?
    Mr. Cadden. Yes, I do.
    Mr. Stearns. In that case, would you be so kind as to 
identify your counsel for our record.
    Mr. Cadden. Mr. Attorney Bruce Singal and Steven Ross.
    Mr. Stearns. And Mr. Steven Ross.
    OK, Mr. Ross do you want to come and sit at the front here?
    Mr. Ross. We are fine.
    Mr. Stearns. At this time, we are going to swear you in. 
Please raise your right hand, and I will swear you in.
    [Witness sworn.]
    Mr. Stearns. Thank you, Mr. Cadden.
    I will recognize myself for the first part of the question.
    Mr. Cadden, are you the one--are you one of the owners of 
the New England Compounding Center, or NECC, the company that 
distributed contaminated injectables to medical clinics, 
doctor's offices, and hospitals across this country?
    Mr. Cadden. On advice of counsel, I respectfully decline to 
answer on the basis of my constitutional rights and privileges, 
including the Fifth Amendment to the United States 
Constitution.
    Mr. Stearns. Mr. Cadden, 32 people have died, 400 people 
are infected, and scores of others who were injected with 
medicine your company compounded are waiting, holding their 
breath to see if they will get sick from the products you have 
made.
    You have been the director of pharmacy at the NECC since it 
opened. You were responsible for ensuring that the products 
were safe and sterile. Mr. Cadden, what explanation can you 
give the families who have lost their loved ones and those who 
are gravely ill for the actions of your company?
    Mr. Cadden. Mr. Chairman, on advice of counsel, I 
respectfully decline to answer on the basis of my 
constitutional rights and privileges, including the Fifth 
Amendment to the United States Constitution.
    Mr. Stearns. The Massachusetts Board found that you 
released two lots of the injectable drugs at issue in this 
meningitis outbreak before you received the lab tests as to 
whether the drugs were sterile. They also found black 
particulate matter within the injectables. The FDA found 
greenish-black matter in the vials.
    Mr. Cadden, there is no question there was a massive 
failure of sterilization at your facility. For the sake of 
protecting the public health and preventing something like this 
from ever happening again and to provide some explanation to 
grieving families, can you please tell us what was the 
breakdown that led to the contamination and the meningitis 
outbreak?
    Mr. Cadden. Mr. Chairman, on the advice of counsel, I 
respectfully decline to answer on the basis of my 
constitutional rights and privileges, including the Fifth 
Amendment to the United States Constitution.
    Mr. Stearns. I now recognize the ranking member, Ms. 
DeGette, for questions.
    Ms. DeGette. Mr. Cadden, we just heard from Joyce Lovelace. 
Joyce Lovelace's husband Eddie was the first one who was found 
to have died of fungal meningitis from one of your company's 
products. He was a judge. He was a husband of 56 years. He was 
a father, a grandfather. He was getting ready in 2 years to 
leave the bench so he could go into law practice with his 
oldest granddaughter.
    And there are a number of other victims around the country 
now who have either died or become terribly ill as a result of 
your product.
    And the chairman talked about some of the findings that 
they found just this year in your company, the greenish-black 
foreign matter inside the vials. There were also things like a 
leaking boiler next to the clean room that created a pool of 
water, which creates a breeding ground for bacteria; an air-
conditioning system that turned off at night despite 
requirements that the clean rooms had a consistent temperature. 
Your own environmental monitoring program showed violative 
levels of bacteria and mold in clean rooms between January and 
September of this year.
    When FDA inspectors looked at NECC's sister company, 
Ameridose, they found the same kind of thing. They reported 
that there were insects in or near areas where sterile products 
were packaged, stored, and manufactured. They even saw a bird 
flying inside an area where there are supposed to be sterile 
packages.
    So I guess I would ask you--I would ask you, what do you 
say to all of these patients and all of these families that 
have been devastated--devastated by these contaminated products 
that your company has produced?
    Mr. Cadden. On advice of counsel, I respectfully decline to 
answer on the basis of my constitutional rights and privileges, 
including the Fifth Amendment to the United States 
Constitution.
    Ms. DeGette. Mr. Chairman, I think it is clear that the 
witness does intend to exercise his Fifth Amendment rights, 
and, with that, I think I will not ask any more questions. We 
won't have any more on this side.
    Thank you.
    Mr. Stearns. I thank the ranking member.
    Let me be clear, Mr. Cadden. Again, are you refusing to 
answer the questions on the basis of the protections afforded 
to you under the Fifth Amendment to the United States 
Constitution?
    Mr. Cadden. On advice of counsel, I respectfully decline to 
answer on the basis of my constitutional rights and privileges.
    Mr. Stearns. Will you invoke your Fifth Amendment rights in 
response to all questions today?
    Mr. Cadden. Yes.
    Mr. Stearns. Then you are excused from the witness table at 
this time. But I would advise you that you remain subject to 
the process of the committee and that if the committee needs 
are such, then we shall recall you.
    Mr. Cadden. Thank you, Mr. Chairman.
    Mr. Stearns. Yes.
    Now, my colleagues, we will call up the third panel.
    My colleagues, we have on the third panel Commissioner 
Margaret A. Hamburg. Margaret A. Hamburg became the 21st 
Commissioner of Food and Drug on May 18th, 2009. Prior to 
assuming her role as Commissioner, Dr. Hamburg was a senior 
scientist at the Nuclear Threat Initiative. She also served as 
the Assistant Secretary for Policy and Evaluation in the U.S. 
Department of Health and Human Services and as commissioner of 
the New York City Department of Health and Mental Hygiene.
    We also have the interim commissioner, Lauren A. Smith. 
Lauren A. Smith has been the interim commissioner of the 
Massachusetts Department of Public Health since October 25th, 
2012. And prior to assuming that position, Dr. Smith served as 
the medical director and chief medical officer of the 
department.
    Let me welcome you to the committee. And let me ask you, 
you are aware that the committee is holding an investigative 
hearing, and when doing so, it has had the practice of taking 
testimony under oath. Do either one of you have an objection to 
taking testimony under oath?
    Ms. Hamburg. No.
    Ms. Smith. No.
    Mr. Stearns. The chair then advises you that under the 
rules of the House and the rules of the committee, you are 
entitled to be advised by counsel. Do you desire to be advised 
by counsel during your testimony today?
    Ms. Smith. No.
    Ms. Hamburg. No.
    Mr. Stearns. In that case, if you would please rise and 
raise your right hand, I will swear you in.
    [Witnesses sworn.]
    Mr. Stearns. You are now under oath and subject to the 
penalties set forth in Title 18, Section 1001 of the United 
States Code.
    You may now give a 5-minute summary of your written 
statement.
    Dr. Hamburg?

STATEMENTS OF MARGARET A. HAMBURG, COMMISSIONER, FOOD AND DRUG 
    ADMINISTRATION, AND LAUREN SMITH, INTERIM COMMISSIONER, 
           MASSACHUSETTS DEPARTMENT OF PUBLIC HEALTH

                STATEMENT OF MARGARET A. HAMBURG

    Ms. Hamburg. Mr. Chairman and members of the subcommittee, 
I am Dr. Margaret Hamburg, Commissioner of the Food and Drug 
Administration. And I am joined by Howard Sklamberg, Deputy 
Associate Commissioner for Regulatory Affairs.
    Thank you for this opportunity to testify about the tragic 
fungal meningitis outbreak associated with an injectable 
steroid product distributed by NECC and for our safety concerns 
related to compounding and the legislation that is needed to 
prevent such incidents from happening again.
    I want to begin by offering my deepest sympathies to the 
patients affected by this outbreak and their families. This 
event has had devastating effects on patients across the 
country, such as Eddie Lovelace, Judge Lovelace, many of whom 
were likely unaware that they were being treated with a 
compounded product not reviewed or approved by the FDA.
    Our foremost goal is the protection of the health of the 
public. Since the onset of this outbreak, we have targeted FDA 
resources, from experts in our headquarters to inspectors and 
scientists in district offices and labs across the country, to 
do everything we can to stem the toll of this terrible event. 
Together with CDC and the States, we have sought to identify 
potentially contaminated products and ensure that they are 
removed from the market and do not reach patients. We have 
collected and analyzed hundreds of samples from the relevant 
firms, as well as from medical facilities and State and local 
agencies, to isolate the cause and determine the extent of the 
contamination.
    We are working daily to ensure timely, clear, and accurate 
information is disseminated about the findings of our 
investigation, what products are affected, and what providers 
should do with any products still on their shelves. And we are 
working to alleviate existing drug shortages exacerbated by 
product recalls.
    We have also been reviewing actions taken in the past with 
regard to NECC. From our review thus far, we have no reason to 
believe that any of the specific actions in question, a more 
timely issuance of the 2006 warning letter, or inspectional 
follow-up, would have prevented this recent tragedy.
    What we do know is that stronger, clearer authority would 
enable more effective regulation of the drug-compounding 
industry, especially when it has been evolving so 
significantly. As it is, our authority over compounding is 
limited, unclear, and contested. And in the face of differing 
views in Congress and the courts about FDA's authority and 
continuing challenges by industry, the agency has struggled 
with how to chart an effective course to protect the public 
health.
    We recognize that traditional compounding provides an 
important service for patients who, for example, can't swallow 
a pill or are allergic to an ingredient in a drug product. But 
the industry has evolved well beyond the neighborhood 
pharmacist. In particular, the movement by many hospitals to 
outsource pharmacy compounding has created a market for 
compounding operations that produce drugs that reach far larger 
numbers of patients. When these facilities operate well, they 
may serve an important function in terms of safety and 
efficiency. However, when they fail to follow safety and 
quality standards, many patients may be harmed.
    Our best information is that there are thousands of other 
compounders out there producing what should be sterile products 
made to exacting standards, and, thus, many other firms with 
the potential to generate a tragedy like this.
    The current oversight framework, in attempting to draw a 
bright line between compounders and manufacturers, fails to 
address the complex issues raised by a changing industry. 
Additionally, gaps and ambiguities in the law have hampered our 
ability to act to protect patients and to prevent rather than 
just react to safety concerns.
    I am committed to working with Congress and other 
stakeholders to design a system of rational, risk-based 
regulation that takes into account both the Federal and the 
State roles. As I outlined in my testimony, we have developed a 
proposed framework that would tier the degree of oversight to 
the risk posed by the type of product and practices. 
Traditional compounding would remain the purview of the States. 
The higher risk posed by nontraditional compounding would be 
addressed by Federal standards, including standards for quality 
control.
    And under this framework, certain products carrying the 
highest risk could not be compounded. They could only be 
produced by entities willing to meet the standards currently 
required of drug manufacturers.
    We would like to explore with you authorities that would be 
important to support this new regulatory paradigm, including 
clear authority to access records, mandatory reporting of 
adverse events, additional registration requirements to 
facilitate appropriate oversight and coordination with State 
regulators, clear label statements to allow prescribers and 
consumers the opportunity to make informed judgments, and 
adequate funding to support the inspections and other oversight 
activities outlined in this framework.
    And because a key piece of any plan involving oversight of 
pharmacy compounders will continue to be performed at the State 
level, we must work closely with our State partners as we 
develop the framework for new authorities. Consequently, FDA 
will be inviting representatives from all 50 States to 
participate in a full-day meeting on December 19th to 
facilitate these important discussions.
    We have a collective opportunity and responsibility to help 
prevent future tragedies. If we fail to act, this type of 
incident will happen again. It is a matter of when, not if. If 
we fail to act now, it will only be a matter of time until we 
are all back in this room, sadly, asking why more people have 
died and what could have been done to prevent it.
    I am happy to answer any questions you may have.
    Mr. Stearns. I thank you.
    [The prepared statement of Ms. Hamburg follows:]


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    Mr. Stearns. Dr. Smith, for your summary of your opening 
statement?

                   STATEMENT OF LAUREN SMITH

    Ms. Smith. Thank you, Chairman Stearns, Ranking Member 
DeGette, and members of the committee. Thank you very much for 
having me here today. My name is Dr. Lauren Smith, and I am the 
interim commissioner of the Massachusetts Department of Public 
Health.
    I have to also begin by saying that my thoughts are with 
the victims and families affected by this tragic outbreak and 
with Mrs. Lovelace, whose moving testimony only strengthens my 
resolve to ensure that no other family has to suffer what she 
aptly described as the heartbreak that hers has. As a mother, a 
pediatrician, and a public health leader, I have devoted my 
life and career to protecting the health of others. These 
events evoke in me the same sense of outrage as they do for you 
and the rest of the public. For many of you, I know this hits 
very close to home.
    For the past 2 months, our department, along with the FDA, 
has conducted a joint investigation of New England Compounding 
Center, the source of this devastating fungal meningitis 
outbreak that has sickened hundreds and killed 31 people across 
the country. We have also investigated and shut down NECC's 
sister company.
    NECC knowingly disregarded sterility tests, prepared 
medicine in unsanitary conditions, and violated their pharmacy 
license, endangering thousands of lives as a result. NECC bears 
the responsibility for the harm that they have caused with 
these actions.
    I was given the responsibility, as interim commissioner, 
less than 3 weeks ago to lead my department through this 
crisis, and, like you, I have been trying to put together the 
pieces of the puzzle.
    First licensed by Massachusetts in 1998, NECC and its 
owner, Barry Cadden, have since been the subject of numerous 
complaints, resulting in a series of investigations by the 
State and the FDA. These investigations led to the Board of 
Pharmacy's proposed reprimand and probation in 2004. This 
proposal was inexplicably weakened in 2006, allowing NECC to 
continue to operate without disciplinary actions, pending an 
independent evaluation of its progress under a consent 
agreement. The Board of Pharmacy's failure to take decisive 
disciplinary action in 2006 on these complaints has contributed 
to these tragic events.
    In April of 2006, the Board of Pharmacy's staff learned 
that the principal of PSI, the evaluator for NECC, had been 
convicted of Federal crimes that resulted in 18 people being 
blinded. However, the staff did not share this information with 
board members before they accepted the report from PSI 
validating NECC's compliance with the consent agreement. These 
same staff members failed to act on a July 2012 report from the 
Colorado Board of Pharmacy that NECC had violated both Colorado 
and Massachusetts pharmacy regulations. These staff have been 
removed from their jobs.
    Poor judgment, missed opportunities, and a lack of 
appropriate action allowed NECC to continue on this troubling 
path. We acknowledge that these lapses--some of which were 
preventable, but all are unacceptable.
    From the early days of this outbreak, our department has 
acted swiftly and decisively. We secured a surrender of NECC's 
license, shut down its operations, and forced a total recall of 
all NECC products. We moved to permanently revoke NECC's 
license as well as the licenses of the three principal 
pharmacists who oversaw their operations. We also secured the 
suspension of operations of Ameridose and Alaunus, two other 
drug manufacturers owned by Barry Cadden, which, as you know, 
have been found to have similar substandard practices.
    While taking these strong and necessary actions, we have 
reexamined our own State regulations regarding compounding 
pharmacies. Although our regulations are comparable to those in 
most States, they need to be strengthened to address the 
realities of this evolving industry.
    On November 1st, Massachusetts enacted a series of 
emergency regulations to bring greater scrutiny to this 
industry and require sterile compounding pharmacies to report 
both volume and distribution information to us. Licensed 
pharmacies will also have to report when they are the subject 
of any State or Federal investigations. We have also begun 
unannounced inspections of all sterile compounding pharmacies 
in Massachusetts. Teams are conducting these inspections even 
as we speak.
    To further strengthen our oversight over sterile 
compounding pharmacies, we must explore changes to the law. We 
have created a special commission to review best practices in 
other States and to identify stronger mechanisms for oversight 
for these pharmacies in Massachusetts.
    As we work to raise standards in our State, we urge 
Congress to act to strengthen Federal oversight. Congressman 
Markey's leadership on this issue is laudable and would address 
some of the regulatory black holes that exist between State and 
Federal oversight.
    As a pediatrician who has cared for acutely ill children 
and their families for almost 20 years, I must say that I 
understand the trust that patients place in our healthcare 
system. We must use these tragic events as an impetus to work 
together--public health leaders, public health officials, and 
legislators--to institute reforms to restore this trust and to 
ensure that something like this does not ever happen again.
    We will keep the victims and their families always in our 
thoughts--they are not numbers, they are not statistics, but 
real people with real lives--as we work to identify 
responsibility and to implement policies and practices that can 
be effective and lasting.
    Thank you. I appreciate the committee's interest in this 
matter, and I am grateful to you for acting so swiftly to have 
us come here to discuss it.
    [The prepared statement of Ms. Smith follows:]


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    Mr. Stearns. Thank you, Dr. Smith.
    Commissioner Hamburg, the title of this hearing is ``The 
Fungal Meningitis Outbreak: Could It Have Been Prevented?''
    Now, your testimony is 16 pages long. There is one sentence 
on FDA oversight on the New England Compounding Center prior to 
the outbreak. Now, this was--this is an investigative hearing. 
This was a complete and utter failure on the part of your 
agency and--Dr. Smith in her testimony admitted--and the State 
Board of Pharmacy. The committee's memorandum that we did, we 
had 25 pages laying this out. Yet you devoted just 1 sentence 
of your 16 pages in your opening statement that even talked 
about this oversight.
    Over the years, the FDA repeatedly--repeatedly documented 
numerous problems at the NECC. Many of these problems are 
similar, if not identical, to the same problems which caused 
this outbreak. The agency ultimately issued a warning letter in 
2006, 6 years ago, stating that if the company did not alter 
its practices, FDA would seize its product or issue an 
injunction and effectively shut down NECC.
    Now, we heard Dr. Smith; you heard her testimony this 
morning. She talked about the mistakes they made and what they 
are going to do to correct it. You are here with your opening 
statement, you are practicing plausible deniability is what you 
are practicing.
    When FDA issued the 2006 warning letter, did FDA have the 
authority to do what it said--namely, seize the drugs and shut 
down the committee--the company? Yes or no?
    Ms. Hamburg. I think it is important--the fact is----
    Mr. Stearns. No, the question is, did you have the 
authority----
    Ms. Hamburg [continuing]. The one letter did not involve 
sterility failures, and it was not in relation to the kinds of 
problems that we are addressing now.
    Mr. Stearns. So you are saying your letter was an empty 
threat?
    Ms. Hamburg. You know, I think one of the great 
challenges----
    Mr. Stearns. No, the real question is, did you think you 
had the authority----
    Mr. Waxman. It wasn't her letter.
    Ms. DeGette. It wasn't her letter.
    Mr. Stearns. Well, not your letter, personally, but----
    Ms. Hamburg. I think it is important to understand that I 
was not at----
    Mr. Stearns. No, I understand that and I appreciate that.
    Ms. Hamburg [continuing]. The FDA at the time and that----
    Mr. Stearns. And I am just staying that the frustration we 
have is----
    Ms. Hamburg [continuing]. The warning letter and the 
inspection it was based on had to do with a different set of 
complaints than sterility failures----
    Mr. Stearns. Let me rephrase the question. Do you think the 
FDA had the authority to shut down NECC? Yes or no?
    Ms. Hamburg. I think that is a very, very complex question 
and that the legal framework----
    Mr. Stearns. So you can't answer that question now?
    Ms. Hamburg [continuing]. For FDA activities is----
    Mr. Stearns. OK, let me ask another question.
    Ms. Hamburg [continuing]. Very, very unclear----
    Mr. Stearns. If you are not going to answer this question--
--
    Ms. Hamburg [continuing]. Contested, and limited.
    Mr. Stearns. [continuing]. Let me ask you----
    Mr. Waxman. May she answer the question?
    Mr. Stearns. Well, she is not answering the question, Mr. 
Waxman.
    Mr. Waxman. She is trying.
    Mr. Stearns. Well, I had asked her ``yes or no,'' and she 
won't answer the question.
    Ms. DeGette. She can't.
    Mr. Stearns. This is my--my questions can be asked. You can 
ask your question.
    Ms. Hamburg. You know, I think that the answer to your 
question is that, even on much smaller regulatory actions, the 
FDA authority to act was contested. Even going into NECC to do 
that inspection in 2004----
    Mr. Stearns. OK. Let me interrupt you----
    Ms. Hamburg [continuing]. We did not get access to the 
records immediately.
    Mr. Stearns. I am asking the questions, and I only have so 
much time.
    You issued the letter in 2006. You said you were going to 
shut it down if they didn't improve on their quality assurance. 
Was that an empty threat?
    Ms. Hamburg. The----
    Mr. Stearns. Did the FDA think they had the jurisdiction, 
they had the responsibility to shut it down?
    Ms. Hamburg. The warning letter concerned, first and 
foremost, an issue that had to do with making copies of a 
commercially available drug.
    Mr. Stearns. We have a different interpretation----
    Ms. Hamburg. It was a different issue.
    Mr. Stearns [continuing]. Of my question. Let me interrupt 
you and ask you another question.
    When the FDA inspected the NECC in 2002--that is 10 years 
ago--there was evidence that people had been infected by 
contaminated NECC products. Some of those people were 
experiencing meningitis-like symptoms.
    What proof did the company provide then that it had 
corrected these problems?
    Ms. Hamburg. Well, as I think you understand from the 
documents we provided and the information that has been 
discussed, it was--we went in and we found problems, and we 
worked closely with the Massachusetts Board of Pharmacy to 
address them. But it was determined that the primary 
responsibility for overseeing NECC was Massachusetts because 
they were operating as a compound pharmacy----
    Mr. Stearns. So you were deferring to the State of 
Massachusetts?
    Ms. Hamburg. Well, we worked with the State. We----
    Mr. Stearns. OK.
    Ms. Hamburg [continuing]. Tried to provide help and 
assistance.
    Mr. Stearns. All right.
    Ms. Hamburg. But the responsibility for assuring----
    Mr. Stearns. So it is not your job; it is the State of 
Massachusetts'. OK.
    Ms. Hamburg [continuing]. Compliance with sterility issues 
was, in fact----
    Mr. Stearns. Let me ask this last question.
    Ms. Hamburg [continuing]. Not our direct responsibility.
    Mr. Stearns. Before the current outbreak, the last time FDA 
inspected the NECC was in January of 2005, which led to the 
warning letter. The warning letter stated that FDA may conduct 
follow-up inspections to ensure that the NECC was in 
compliance.
    There was not a single follow-up inspection that occurred 
after 2005; is that correct? Yes or no?
    Ms. Hamburg. That----
    Mr. Stearns. Do you want me to repeat the question? There 
was not a single follow-up inspection that occurred after 2005.
    Ms. Hamburg. We did not do----
    Mr. Stearns. OK.
    Ms. Hamburg. Again, I have to----
    Mr. Stearns. OK. That is a ``yes.''
    Ms. Hamburg [continuing]. Make clear that I was not 
present----
    Mr. Stearns. All right, let me finish.
    Ms. Hamburg [continuing]. At the FDA at the time.
    Mr. Stearns. After noting----
    Ms. Hamburg. And it is my understanding----
    Mr. Stearns. OK.
    Ms. Hamburg [continuing]. And I cannot speak----
    Mr. Stearns. OK.
    Ms. Hamburg [continuing]. To all of the issues that were 
involved there, but----
    Mr. Stearns. You are taking my time. Let me finish.
    After noting violations upon violation--violations upon 
violation in 2002 through 2005, why did the FDA feel confident 
that the NECC would correct its violations and obey the law? I 
mean, you had from 2002 to 2005 all these violations. What made 
you think that they would correct them? And not you, 
personally; I understand you weren't there.
    Ms. Hamburg. With respect to the first violations 
concerning the sterility issues, those were very serious 
concerns. We acted aggressively, in partnership with the State 
of Massachusetts.
    But the day-to-day responsibility for overseeing the 
practice and remediating the sterility failures were taken on 
by the State of Massachusetts, who had the primary day-to-day 
oversight of this compounding pharmacy. A consent decree was 
reached in 2006, and we had understood, as had the 
Massachusetts Board of Pharmacy, that they were appropriately 
addressing those sterility concerns.
    We had gone in in relation to a different complaint from a 
company about the copying of an FDA drug. And in that 
instance--we went in in relation to the manufacture of a 
specific product, trypan blue--it was not an issue of sterility 
failure or the conditions in the facility, but it was a 
practice that we felt they should not be pursuing, and that was 
what we were trying to address.
    Mr. Stearns. My time has expired, and I recognize the 
ranking member from Colorado, Ms. DeGette.
    Ms. DeGette. Thank you very much, Mr. Chairman.
    Dr. Hamburg, I want to try to clarify what is going on 
here, so I would appreciate short answers also.
    Now, most of the FDA inspections into this manufacturer, 
NECC, were about 10 years ago, correct? And that was under the 
FDA under the Bush administration, correct?
    Ms. Hamburg. That is correct.
    Ms. DeGette. OK. Now, in 1997--I was actually here then--
the FDA Modernization Act excluded the small--well, it excluded 
drug compounders, for the most part; is that correct?
    Ms. Hamburg. That is correct. If a pharmacy was operating 
in accordance with certain conditions, then they were excluded.
    Ms. DeGette. So the FDA didn't have authority over those 
types of compounders, correct?
    Ms. Hamburg. That is correct.
    Ms. DeGette. So after the 1997 act was passed, when the FDA 
received complaints about drug compounding, it had to go over 
the hurdle of determining whether those conditions had been met 
or not before the FDA was determined to even have authority; is 
that correct?
    Ms. Hamburg. Correct.
    Ms. DeGette. So what happened here is that the FDA was 
contacted in 2002 about some problems. They went into NECC, 
they found some problems, and there was a whole series of 
investigative efforts after that, correct?
    Ms. Hamburg. Yes.
    Ms. DeGette. And one of the issues in this case and in 
other cases was whether the FDA even had authority to be 
investigating complaints, whether or not this particular 
manufacturer fell under the appropriate criteria, right?
    Ms. Hamburg. With respect to the public health threat that 
was identified in 2002, we went in and aggressively 
investigated and worked with the State of Massachusetts to get 
those contaminated products recalled to prevent ongoing damage 
to patients. Then, because this was a compounding pharmacy, 
with the primary responsibility for oversight resting with the 
Massachusetts State Board of Pharmacy, they were responsible 
for the efforts----
    Ms. DeGette. ``They''? Who is ``they''?
    Ms. Hamburg. The Massachusetts State Board of Pharmacy.
    Ms. DeGette. Massachusetts was primarily responsible 
because it was a compounding pharmacy, right?
    Ms. Hamburg. Because it was a compounding pharmacy.
    Ms. DeGette. OK. So, in other cases, not particularly NECC 
but in other cases, when the FDA tried to assert jurisdiction 
over compounding pharmacies in similar situations, they were 
actually sued in court, the FDA was sued in court by these 
companies, saying the FDA didn't have jurisdiction over these 
pharmacies, correct?
    Ms. Hamburg. That is correct.
    Ms. DeGette. And, in fact, there is a court case that 
covers part of the whole country that says the FDA doesn't have 
jurisdiction; is that right?
    Ms. Hamburg. The challenge we have today is that there is a 
patchwork of legal authorities that really oversee the 
regulatory actions that we can take. We have a split circuit 
court decision. There is a map that we have that shows that, 
you know, unfortunately, we have unclear, fragmented legal 
regulatory frameworks that make it very hard to understand how 
best to exercise enforcement.
    Ms. DeGette. Well, and so if you have an emergency like 
this, if you have an emergency like this, sometimes what you 
are afraid of is--you are going to act aggressively, but you 
are afraid that you are going to be hauled into court. And that 
is why oftentimes you go to the State regulatory agency; is 
that correct?
    Ms. Hamburg. Absolutely. The fact that we have unclear, 
limited, and contested authorities and ambiguities in the law 
and a crazy quilt of legal authority has required us to be very 
reactive, responding to those serious public health threats, 
and selective. And, of course, every effort is resource-
intensive, as you say, and often will end up in litigation.
    Ms. DeGette. OK, so let me ask you this: If Congress 
clarified what we meant in the 1997 act with these large 
compounding pharmacies, that we, yes, indeed, intend to give 
the FDA jurisdiction, that will help you be able to protect 
these patients better by either doing inspections to prevent 
these problems in the first place or by requiring quick 
recalls; is that correct?
    Ms. Hamburg. Absolutely.
    Ms. DeGette. Thank you.
    Ms. Hamburg. We clearly need additional authority.
    Ms. DeGette. I just want to ask a really quick question of 
Dr. Smith.
    I really appreciate the efforts that you are making since 
you took over. But, again, most of these things that happened--
in fact, all of these things that happened--happened before 
your tenure, Dr. Smith.
    And I guess I would like to know--and in reading all the 
documents and all of the history of this, it is obvious to me 
that the ball was dropped, and dropped in a big way, by the 
Massachusetts regulators. And so my question is, what is 
Massachusetts doing now to make sure this never happens again?
    Ms. Smith. Well, I agree with you that there were certainly 
missed opportunities and lapses of judgment that demonstrate 
significant irresponsibility. And we have taken action with the 
staff that demonstrated that.
    In terms of what we are doing now, I think the highlight 
would be the enactment of the emergency regulations, 
importantly, which would require sterile compounding pharmacies 
to produce information regarding volume and distribution--the 
volume issue being so important because if you are making 
numerous batches, thousands of vials of material, then 
effectively you are acting more like a manufacturer than the 
more traditional compounder.
    We also require pharmacies to provide information on any 
State or Federal investigations that concern them. That would 
allow us to have known that your State's board of pharmacy had, 
in fact, issued a cease-and-desist to NECC in April of 2011 for 
this same issue of providing bulk prescriptions that were not 
patient-specific.
    And, lastly, we have done the--convening a special 
commission to really understand what are the best practices in 
strengthening the oversight of this evolving industry.
    We clearly are committed to making sure that this doesn't 
happen again, and we want to do everything in our power to do 
that.
    Ms. DeGette. Thank you.
    Thank you very much, Mr. Chairman. I appreciate your 
indulgence.
    Mr. Stearns. The chairman of the full committee, Mr. Upton, 
the gentleman from Michigan.
    Mr. Upton. Thank you, Mr. Chairman.
    I just want to remind all of us here that this committee 
has a very long tradition, even before John Dingell, of working 
with strong members to identify problems in this country, to 
expose that, and then coming back with legislation to fix it so 
it doesn't happen again.
    And one of those, as we all review this case and see what 
was there--the recent inspection, the visible black 
particulate, the tacky mats, the leaking boiler, the bird 
flying around--I mean, it is just, what gives? I mean, if this 
was found just recently--and it is our understanding that there 
were similar types of contamination in earlier years--what is 
the problem without--what is the problem by not shutting down 
something like this until it is corrected?
    And if you don't have the authority, then we need to make 
sure that it is there. And it seems pretty reasonable to me 
that, in fact, you did have the authority to not only have 
unannounced inspections but to come in and correct it so that 
it didn't get to this stage.
    Certainly, with the deaths of people across the country and 
the questions that are raised today, as part of the tradition 
of this committee, we have to have the right information to 
find out if something is off track or whatever.
    And I guess one of the concerns that I have is that, in a 
bipartisan letter that was sent nearly a month ago, we asked 
the FDA for documents, for internal communications, to find out 
what discussions were going on, what was the feedback from the 
company. And it is my understanding that to date we have some 
emails that have come back but not anywhere close to what we 
ought to have as we really try to move an investigation forward 
and try to get to the very bottom of this and make sure that it 
never can happen again.
    And I would ask Commissioner Hamburg if we can have a 
commitment from you, as it relates back to the letter that we 
sent on October 17th, that we get the full cooperation from 
your staff so that we can come back and ask questions and 
really try to get to the bottom of this to identify where are 
the problems. Because, clearly, they were there, right?
    Ms. Hamburg. We will work very hard with you. We appreciate 
the work this committee is undertaking. We have tried to get 
you documents in a timely way. We have, you know, so far been 
able to get you----
    Mr. Upton. Not very many.
    Ms. Hamburg [continuing]. You know, the 2,000 pages of 
documents. But, unfortunately, we are also pursuing the active 
public health investigation response, and many of the same 
people that are involved, have the right expertise and 
knowledge of the issues, are working on that at the same time 
that we are trying to get you that information.
    And of course, as Congresswoman DeGette pointed out, this 
concerns activities, some of it going back many years to a 
different administration and different employees at the FDA. So 
we are going through, trying to get all those documents, and we 
will be continuing to provide you with the information you have 
requested.
    Mr. Upton. Well, I just want to say, I had a long 
discussion last month during the break with my colleague from 
Michigan, Mr. Dingell. Very frustrated about what was going on. 
Wanting to get to the bottom of this, wanting to make--you 
know, as we all think about the FDA's proper role, I mean, this 
would be it. I mean, as we all identify facilities in our own 
districts--I know that when I go visit, it is clean as a 
whistle. It really is. The people are proud to have the jobs 
that they have. It is as sterile as you can imagine.
    And I can't, you know, for the life of me, as we read about 
this information from eyewitness accounts and inspections that 
were there before, and to have it go on and on and on without a 
follow-up, without--I mean, that is not--that is not what 
anyone is expecting the FDA to do. When you find this stuff, it 
needs to stop.
    And, as Americans, we demand that for manufacturing here. 
We also expect it to happen overseas. And your inspections in 
China and other places, that the products that are being 
produced are safe, not only for Americans but all humans. And 
when we--you know, we get terribly frustrated.
    I know you tried to call me yesterday afternoon. It was my 
first day back. And we are going to continue to communicate, I 
can assure you.
    But we want to get to the bottom of this. We want to find 
out what really did break down and where are the questions that 
have to be answered so that, in fact, you do have the baseball 
bat to go after these companies that are--it is not right. And 
this is not going to be the last hearing, because we don't have 
the information that we need to proceed.
    So I would like to get just--I know my time is expiring, 
but we would like to get a commitment from you that, in fact, 
you will be totally responsive to the questions that are asked 
by Republicans and Democrats so that we can figure out where 
this train got off the track so that we can put it on and we 
can assure every person in this country that, in fact, the FDA 
is working as it should.
    And we shouldn't have to hear the stories that we did 
earlier this morning with Mrs. Lovelace and our constituents, 
whatever State that they are in. And I would like to get that 
from you and just assure you that we are not--this is not a 
one-time deal. We are going to get to the bottom of it.
    Ms. Hamburg. You have my absolute commitment that we will 
continue to work with you and all of your requests for 
additional information.
    You have also touched on a very important point that I want 
to underscore, though, which is that we have responsibilities 
for oversight of manufacturers and drug facilities in this 
country and around the world, but our authorities to provide 
oversight of drug manufacturers is very different than our 
authority to oversee compounding pharmacies, which are, in 
fact, exempted from important aspects of FDA law.
    And there is, you know, this disconnect between different 
legal requirements in different parts of the country, as well. 
We have ambiguous, fragmented, unclear, and contested 
authorities in this particular realm of pharmacy and drug 
manufacturing practice.
    And that is what our opportunity is now and what our 
responsibility, I think, is, to work together to really create 
new legislative authority that defines the best approaches, 
that gives us the broader authorities that we need to address 
this growing arena of what we call ``nontraditional 
compounding'' that involves larger volume, more complex 
products, including sterile products, and broader distribution, 
potentially putting more patients at risk.
    And there are gaps in the oversight authorities of the 
States, who have primary responsibility for overseeing 
compounding pharmacies, and the FDA. And we need to make sure 
that we have a seamless system that protects patients.
    Mr. Stearns. The gentleman from California, Mr. Waxman, is 
recognized for 5 minutes.
    Mr. Waxman. Thank you, Mr. Chairman.
    I want to commend Chairman Upton for his statements and his 
questions because I think this committee needs to respond on a 
bipartisan basis.
    And I think we need to correct the law, and we ought to try 
to do it before we leave at the end of this year for this 
simple reason: When you get into the next year, some of these 
interest groups are going to gear up to stop legislation. They 
will say that we really don't need to have the FDA look at 
these compounders. FDA regulates the manufacturers, but the 
compounders are going to be regulated at the State level.
    Now, you are being criticized, Dr. Hamburg, as the head of 
the FDA, for the problems that were primarily the 
responsibility of the State of Massachusetts. And often we hear 
on this committee, ``We ought to let the States handle things, 
not the Federal Government.''
    In fact, I want to express some sympathy for you at FDA 
because you are in a no-win situation. When the FDA asked for 
more data to determine whether a drug is safe and effective, or 
takes enforcement action for violations of good manufacturing 
practices, the agency is accused of being a job-killer, an 
over-regulator. But now when something terrible happens, we 
hear that something went wrong and everybody is quick to jump 
on you for not doing enough.
    Now, if we expect you to do more, we better be sure that 
the statutory law gives you enough authority to do your job, if 
we want you to do the job and not the State to do the job.
    And let me be very critical of the State. The State of 
Massachusetts dropped the ball. They entered into a consent 
decree with the company and said--it was a weaker consent 
decree than they originally started with, and said, oh, you 
ought to get an independent inspector. So the company hired an 
independent inspector. And then the independent inspector came 
back and said, everything is fine. And then there were 
questions about whether this was really an inspector that was 
independent, which is a good thing to keep in mind when we say, 
let the companies decide who to pick to investigate themselves.
    So let's look at what we can do now. How many compounding 
pharmacies are there in the United States?
    Ms. Hamburg. You know, we don't know the exact number 
because they are not required to register, and so, you know, we 
are really uncertain. But there are thousands of pharmacies 
that do compounding. We think that there are about 7,500 
pharmacies that do more so-called advanced compounding and 
about 3,000 facilities that are doing sterile compounding.
    Mr. Waxman. Now, compare that to manufacturers where there 
is no question that you have the jurisdiction to inspect them 
and to approve their drugs and to recall their drugs. How many 
manufacturers are there--manufacturing facilities compared to 
the compounding facilities?
    Ms. Hamburg. You know, there are about 5,600 manufacturers 
that we provide oversight for, including regular inspections. 
And there is a broader array of facilities that we also oversee 
in that context.
    Mr. Waxman. Well, in 1997 Congress attempted to codify an 
FDA regulatory system with respect to these compounding 
pharmacies, but then the Supreme Court later invalidated a part 
of that law, raising the question of whether the rest of the 
law is still in force.
    Some have argued the FDA still has the ability to cobble 
together other authorities to act to prevent this tragedy 
caused by NECC. I don't know if that was a realistic 
possibility or not. What I do know is that, at the very least, 
there is a dangerous lack of clarity in FDA's authority here, 
and we should fix that.
    Do you think there is a lack of clarity?
    Ms. Hamburg. I think there is an enormous lack of clarity, 
and I think we should seize this opportunity to address it. 
We----
    Mr. Waxman. What authority and enforcement tools does the 
FDA need to better enable you at the FDA to take effective 
action when you discover problems at compounding pharmacies?
    Ms. Hamburg. Well, we feel that there needs to be a risk-
based framework that enables us to play our critical role in 
overseeing drugs that are going to the American people. 
Compounding has an important role in addressing medical needs, 
and traditional compounding is probably best overseen at the 
level of the State, though it should always be undertaken by a 
licensed pharmacist or physician and in accordance with a 
prescription for a patient for a specific medical need.
    Mr. Waxman. We----
    Ms. Hamburg. But there is this area of nontraditional 
compounding, where we think really there needs to be focused 
attention and new legislation.
    Mr. Waxman. Now, all pharmaceuticals that are compounded 
don't need to be regulated by the FDA, because the traditional 
way we think of it is a pharmacist putting together a 
prescription for somebody who has a special need. But now we 
have an example of a company that is shipping it all over the 
country. They are making a drug and they are shipping--they are 
like a manufacturer of the drug.
    What we need from you is very specific authorities that you 
must have to be able to deal with this. And the second thing we 
need to recognize is your budget. Because if we give you 
authority and there are thousands of compounding pharmacies, 
your agency I can't imagine has the resources to regulate every 
single one of them, and we need to--you need to rely on the 
States to complement the FDA's oversight. Is that a fair 
statement, that you rely on the States?
    Ms. Hamburg. That is a fair statement.
    And with respect to the authorities, I did outline in the 
testimony. But we clearly believe that for nontraditional 
compounders there should be Federal standards that would 
establish basic safety measures, including sterility controls. 
Could be enforced by the State or by the FDA, but those need to 
exist.
    Then we need standards, new authorities around 
registration, so we know who is out there and what they are 
making. We need to be able to review records----
    Mr. Waxman. Let me--you are absolutely right.
    And I want to say to Chairman Upton and, for the record, 
all the members of this committee that we need to get this 
information. We have to get the right balance. We ought to do 
it before we leave at the end of the year and make it very 
clear that we are not just saying, ``You are at fault, you are 
at fault, somebody else is at fault.'' We are going to be held 
responsible, as Members of Congress, to make sure the law is 
clear and that the agency has the ability and resources to do 
the job that everybody expects you should have done. And we 
want to make sure that you are able to do it.
    Thank you, Mr. Chairman.
    Mr. Stearns. The gentleman's time has expired.
    The gentleman from Texas is recognized for 5 minutes.
    Mr. Barton. Thank you, Mr. Chairman.
    I mean, we have a tragedy of significant proportions here. 
Thirty-two people have died; probably more will. We have a 
bipartisan investigation before this subcommittee. And we 
understand that, you know, business as usual is not acceptable.
    Having said that, apparently the FDA has decided this is 
something that they can use to be able to get more authority to 
regulate or inspect certain transactions that compounding 
pharmacies do. If there really is a lack of regulatory 
authority at some level, then that is a legitimate policy 
recommendation. But if there is not a lack of regulatory 
authority in existence in State and Federal law right now, then 
it is unnecessary.
    And my first question is to both Dr. Hamburg and Dr. Smith. 
Are you all both stating that under current State and Federal 
law neither the State nor the FDA had the authority to seize 
these drugs or to shut this company down?
    Ms. Hamburg. I think it is important to understand----
    Mr. Barton. I want a--I don't need a long--I think it is 
important. If the State of Massachusetts doesn't have the 
authority and the FDA doesn't have the authority, that is one 
thing. But we have a warning letter, 2006, issued by the FDA. 
Now, this is before you were the Commissioner. It says, 
``Failure to promptly correct these deviations may result in 
additional regulatory action without further notice, including 
seizure or injunction against you and your firm.'' So, in 2006, 
in the FDA's warning letter, it was the thought at that time 
that the FDA had sufficient authority.
    And Dr. Smith, on behalf of the Massachusetts--she has only 
been on the job 3 weeks, so we can't hold her liable for what 
happened, you know, 10 years ago, 6 years ago, 7 years ago. But 
I don't think there is any question that if Massachusetts felt 
there was a violation, they had the authority to shut it down.
    So, you know, I think we ought to work on using the 
authority that we have, as opposed to trying to get additional 
authority at the Federal level.
    The FDA went in and inspected this particular company on at 
least two different occasions and, as far as I can tell, other 
than issuing one warning letter, didn't do anything at all.
    Ms. Hamburg. The truth is that in the initial inspections, 
we worked very closely with the Massachusetts Board of 
Pharmacy, which has the responsibility for licensure and 
oversight on a day-to-day basis of compounding pharmacies, 
but----
    Mr. Barton. So, again, go back and answer my question.
    Ms. Hamburg [continuing]. We acted to make sure that the 
contaminated product was recalled and not continuing to put 
people at risk. Our first priority was----
    Mr. Barton. So you are saying the FDA did have the 
authority or did not have the authority?
    Ms. Hamburg. We worked closely with Massachusetts, who 
had----
    Mr. Barton. Can you ever give a straight answer to the 
question?
    Ms. Hamburg [continuing]. The primary responsibility for 
the oversight of that facility.
    Mr. Barton. Either you do or you don't.
    Ms. Hamburg. I think, you know, what is very clear is 
that----
    Mr. Barton. What is very clear is that you don't want to 
answer the question.
    Ms. Hamburg. No, it is complicated, and that is reflected 
here.
    But the responsibilities are different. What FDA has clear 
and strong responsibility for and oversight of----
    Mr. Barton. Let me ask Dr. Smith.
    Ms. Hamburg [continuing]. Is drug manufacturers.
    Mr. Barton. Dr. Smith, does your State----
    Ms. Hamburg. These are held to a different standard. 
Compounding pharmacies are----
    Mr. Barton. Does your State agency have the authority to 
shut this company down if you see a clear violation of the law, 
yes or no?
    Ms. Smith. Yes, it does.
    Mr. Barton. OK.
    Ms. Smith. And, in fact, we----
    Mr. Barton. Thank you. Now, if you----
    Ms. Hamburg. But the State of Massachusetts----
    Mr. Barton. At least you got----
    Ms. Hamburg [continuing]. Has the oversight responsibility 
for compounding pharmacies on a day-to-day basis. FDA has a 
different set of authorities.
    And the challenge is that these authorities, as evidenced 
by that map, are fragmented. And what enforcement actions we 
can take have to be seen through different lenses in different 
parts of the country.
    Mr. Barton. All right.
    Ms. Hamburg. We don't have clear----
    Mr. Barton. I am going to try one more time, Dr. Hamburg. 
Under current law, does the Food and Drug Administration of the 
United States of America have authority over adulterated drugs?
    Ms. Hamburg. We have authority over adulterated drugs, 
and----
    Mr. Barton. Thank you.
    Ms. Hamburg [continuing]. We can take actions in relation 
to that.
    Mr. Barton. OK.
    Mr. Dingell. May the Congressman from Texas have 1 
additional minute? And I would ask that he would yield to me.
    Mr. Stearns. By unanimous consent, so ordered.
    Mr. Barton. And I would be happy to yield to my good 
friend, the gentleman from Michigan.
    Mr. Dingell. I thank my friend.
    Commissioner, two agencies here have dropped the ball. The 
Massachusetts agency has had to fire its head because it didn't 
do its job. Your agency--and I don't want you to be defensive; 
I just want you to recognize a hard fact. Your agency did not 
use your power to define who is a manufacturer. Here you have 
an agency that is--that in just one has sold over 17,000 doses 
in something like 23 States.
    Don't you have the authority to define who is a 
manufacturer and who is a compounder? And if you do, why didn't 
you do it?
    Ms. Hamburg. The problem is that the current legal 
regulatory framework says either you are a compounder or you 
are a manufacturer, and there, in fact, is----
    Mr. Dingell. And you may define both, may you not? You have 
that authority, and you did not do it.
    Ms. Hamburg. I----
    Mr. Dingell. And I thank the gentleman for yielding.
    Ms. Hamburg. The concern, though, is that if it is all or 
nothing that way, then these facilities, if they were defined 
as manufacturers----
    Mr. Dingell. Commissioner, we are trying to solve the 
problem. This is not an issue of where you are here to defend 
yourself. If you choose to do that, you are going to have a 
very hard time in this committee. We do not tolerate that kind 
of foolishness, and I would assure you that you are putting 
your head in the noose.
    I would urge you to just cooperate with us and with my good 
friend and give us the answers that we need----
    Mr. Barton. All right. Now----
    Mr. Dingell [continuing]. So that you can address your 
problems----
    Mr. Barton [continuing]. If I can reclaim the time I no 
longer have----
    Mr. Stearns. Just to recognize where we are, we had a 
unanimous consent to give Mr. Dingell 1 minute, and the time 
now belongs to Mr. Barton.
    Mr. Barton. I am just going to----
    Mr. Stearns. If you would finish up and we will move on 
to----
    Mr. Barton. Yes, I will be quick.
    I want to be explicitly clear. If there really is a 
regulatory gap--based on the record that I have reviewed, I 
don't believe there is. But if there is, I suggest there is a 
bipartisan coalition on this subcommittee and full committee 
that will move legislation to correct it.
    If, however, there is no regulatory gap, I also think there 
is a bipartisan coalition on this subcommittee and full 
committee to work to make sure that the State and the Federal 
agencies with jurisdiction work together to solve this problem 
and to prevent it from happening in the future.
    And, with that, Mr. Chairman, I yield back.
    Mr. Stearns. Yield back.
    And I want to thank the dean of the House of 
Representatives for his taking the initiative to really get the 
Commissioner to answer the question that both Mr. Barton and 
myself and others have asked, is whether you have the 
jurisdiction, and I think the answer is yes.
    Ms. Hamburg. No----
    Mr. Stearns. We recognize for 5 minutes Mr. Dingell.
    Mr. Dingell. I thank you, Mr. Chairman.
    Commissioner, I would appreciate ``yes'' or ``no'' answers 
here.
    Do you have sufficient authority to inspect compounding 
pharmacies, yes or no?
    Ms. Hamburg. No.
    Mr. Dingell. Would you please submit is to us what 
authorities you need so that we can see to it that it is done?
    Do you have the authority to access all records when 
inspecting a compounding pharmacy, yes or no?
    Ms. Hamburg. No.
    Mr. Dingell. Please submit to us the information on what 
you need so we can see to it that that is given to you.
    Do you have authority to require compounding authorities 
to--rather, compounding pharmacies to register with FDA, yes or 
no?
    Ms. Hamburg. No.
    Mr. Dingell. Would you please submit to us the authorities 
that are needed so that we can address that problem?
    All right. Do you have the authority to require compounding 
pharmacies to report adverse events to FDA, yes or no?
    Ms. Hamburg. No.
    Mr. Stearns. Would you please submit to us what authorities 
you need in that area?
    You heard earlier my question about whether or not you have 
the authority to define who is a compounding pharmacy and who 
is a manufacturer. Do you have authority to do that or not, yes 
or no?
    Ms. Hamburg. Yes, on a very technical level.
    Mr. Dingell. All right. If you need some reform of that 
authority, please submit that information to us.
    Ms. Hamburg. We definitely do.
    Mr. Dingell. Commissioner, do you have authority to require 
compounding pharmacies to follow good compounding or something 
equivalent to good manufacturing practices, yes or no?
    Ms. Hamburg. No, we do not.
    Mr. Dingell. Would you please submit to us the authority 
that you require?
    Now, this question to both you and to Dr. Smith: Do you 
have sufficient authority between your agencies, State agencies 
and the Federal agencies, to assure that you are able to 
coordinate your authorities and to achieve the necessary 
controls over both manufacturers and compounding pharmacies?
    Ms. Hamburg. I believe we do not.
    Mr. Dingell. You do not.
    What is your view on that, Dr. Smith? Yes or no?
    Ms. Smith. We don't regulate or oversee manufacturing, so--
--
    Mr. Dingell. OK, but can you define a compounding pharmacy 
so that you can define your authority? We have here something 
where a major problem fell between the cracks. Please submit 
the answer to us for the purposes of the record.
    Now, again, to the Commissioner, do you have authority to 
require compounding pharmacies to indicate on the label of 
their product that the product was compounded and not approved 
by FDA, yes or no?
    Ms. Hamburg. We do not.
    Mr. Dingell. Would you please submit the authority--the 
authority that you need?
    Commissioner, it does not sound to me like FDA has 
authorities to oversee compounding pharmacies, and there is a 
question of your authority to define who is a compounding 
pharmacy. Do you have efficient--do you have sufficient 
authority to oversee compounding pharmacies now, yes or no?
    Ms. Hamburg. We do not, no.
    Mr. Dingell. OK. Please submit to us your suggestions for 
that authority to be given.
    Do you--would you submit to the committee any additional 
authorities that I have not been able to define here this 
morning that we should address to you?
    Now, Commissioner Hamburg, your agency is in receipt of two 
letters dated October 9 and 16, 2012, from my office regarding 
this situation. When will you submit to us a response to those 
letters so that we can have that information available to us as 
the committee proceeds?
    Ms. Hamburg. We will get you those responses as soon as 
possible.
    Mr. Dingell. As soon as you can.
    Mr. Chairman, with thanks, I return to you 24 minutes.
    Mr. Stearns. I think----
    Mr. Dingell. One more question, Mr. Chairman. Those two 
letters, I would ask that they be inserted in the record and 
the response that will be received by the committee.
    Mr. Stearns. We have seen those letters. By unanimous 
consent, so ordered.
    Mr. Dingell. Thank you.
    Mr. Stearns. And I thank the gentleman from Michigan.
    The gentleman from Nebraska, Mr. Terry, is recognized for 5 
minutes.
    Mr. Terry. Thank you, Mr. Chairman.
    Here--I want to follow through on some of the gentleman 
from Michigan, Mr. Dingell's questions because I really do 
think that is at the heart of us trying to figure out where our 
jurisdiction lies or doesn't lie with the FDA and our role.
    So I have toured compounding facilities in my district, 
which usually are small operations. In the part of a current 
pharmacy, somebody brings in a prescription that is unique, 
they compound it, and it is for that patient. That is 
compounding.
    And I don't think the FDA would want--and that is a 
question for a different day--the jurisdiction to go into every 
pharmacy that has compounding abilities to make something 
specific for one of their clients. And that is why that has 
been reserved, I assume, in those discussions, the gentlelady 
from Colorado, of why it was put in the States' hands that are 
best able to do that.
    So now when we focus on the New England Compounding Center, 
it may have called itself ``compounding center,'' but it was a 
large manufacturing. We know that through its past violations 
that have come to the attention of both the State pharmacy 
board and the FDA in the past. So we then have a 2011 incident 
in Denver where pallets of a drug was found; a Colorado board 
of pharmacies issues a cease and desist. So now what we have is 
mass manufacturing of a specific drug for nonspecific people. 
To me, that is the definition of ``manufacturing.''
    So, Ms. Honorable Hamburg, is the issue, then, that the 
definition of ``manufacturing'' within that bill isn't clear 
enough for the FDA? Because it seems pretty clear, if you are 
mass producing, you are sending it into interstate commerce and 
it is not for a specific patient, that that is not compounding, 
that is manufacturing.
    Ms. Hamburg. I think that this has been an evolving 
industry and that we do have a problem that existing law and 
authority is----
    Mr. Terry. What specifically----
    Ms. Hamburg. It is on or off----
    Mr. Terry. Let me interrupt you, since you talk over us.
    I am looking for the specifics in the law that say that 
there is lack of clarity on the definition of 
``manufacturing.'' Because that seems to be the hook that you 
are putting your hat on. Can you specify in the act that we 
have to tighten the definitions?
    Ms. Hamburg. Currently, as we have discussed, there is huge 
disagreement about the FDA authorities, and the courts have 
split on the interpretation of authorities for compounding----
    Mr. Terry. Will you define the parts of the statute that we 
need to focus on regarding tightening the definition of 
``manufacturing''?
    Ms. Hamburg. The problem is that, with this evolving 
industry, there is a gray area. If we would be to regulate the 
thousands of compounders----
    Mr. Terry. That is a great speech. Can you refer me to the 
part of the statute that we need to focus on, yes or no?
    Ms. Hamburg. I am sorry, could you repeat----
    Mr. Terry. Refer me to the appropriate part of the statute 
that lacks the clarity of which you complain.
    Ms. Hamburg. The FDA has the authority to act against----
    Mr. Terry. Manufacturers.
    Ms. Hamburg [continuing]. Manufacturers.
    Mr. Terry. And this is generally manufacturers----
    Ms. Hamburg. We have the oversight of drug manufacturers, 
and with that comes a set of activities----
    Mr. Terry. All right.
    Ms. Hamburg [continuing]. That do not apply to compounders, 
including the----
    Mr. Terry. So you will not refer me to a specific section 
of which you feel lacks clarity.
    One last question for Dr. Smith.
    This is very frustrating, madam.
    Dr. Smith, you are in a really tough place, and you have 
done a great job. You have presented well today. But I am very 
curious. With all of the knowledge that was brought to the 
State board--a colossal failure here. You said you are looking 
into that and putting the pieces together. I am just curious, 
is there any evidence of a special relationship between the 
State board and this manufacturer? Because it seems like 
somebody is covering for somebody.
    Ms. Smith. Well, we are as concerned about the missed 
opportunities as you are. And there are numerous, numerous 
episodes of that. We are in the process, as I said, of 
reviewing just that through interviews and through the 
exhaustive document reviews that we are doing and reviewing the 
documents that we have produced for this committee. It is, you 
know, thousands and thousands of pages.
    So I can't--I don't know the answer to your question, but 
we are trying to----
    Mr. Terry. Well, I appreciate that you are looking into 
that.
    Just the last 5 seconds, Madam Honorable Hamburg. Getting 
your testimony at 1:30 a.m., most of us are sleeping then, so I 
guess the whole purpose was to not let us see in advance your 
testimony.
    I yield back.
    Mr. Stearns. The gentleman yields back.
    The gentleman from Massachusetts, Mr. Markey, is recognized 
for 5 minutes.
    Mr. Markey. Thank you, Mr. Chairman.
    Ms. Hamburg, I have introduced legislation to give the FDA 
authority to define which compounding pharmacies should be 
required to register as manufacturers. Would you support that?
    Ms. Hamburg. We think it is very important that we have 
additional legislation in this area and that compounders, in 
fact, register and that it can be defined, what they are doing, 
what they are manufacturing, and what the appropriate 
regulatory oversight would be.
    Mr. Markey. I have introduced legislation to give the FDA 
authority to require compounding pharmacies to compound safe 
drugs using safe practices. Would you support that?
    Ms. Hamburg. I do support that.
    Mr. Markey. I have introduced legislation to give FDA 
authority to conduct the same inspections and request the same 
documents as it can from manufacturers. Do you support that?
    Ms. Hamburg. It is enormously important that we have the 
authority to go in and be able to do full inspections and 
review documents, collect samples, et cetera.
    Mr. Markey. I have introduced legislation that requires 
compounding pharmacies to submit reports of adverse reactions 
or safety problems to the FDA. Do you support the FDA having 
that authority?
    Ms. Hamburg. Yes. It is currently a gap, that adverse 
events are not required to be reported from compounding 
pharmacies.
    Mr. Markey. And I have introduced legislation to require 
compounded drugs to be labeled. Do you believe that that 
authority should be given to you?
    Ms. Hamburg. Yes, we do.
    Mr. Markey. And I might say, the legislation also allows 
traditional compounding pharmacies, those which are just doing 
individual doses to individual patients, to continue to stay 
under State jurisdiction. Do you agree with that?
    Ms. Hamburg. Traditional compounding, one patient, one 
prescription----
    Mr. Markey. Yes.
    Ms. Hamburg [continuing]. Should be overseen by a licensed 
physician or pharmacist, but it does not require the FDA 
oversight.
    It is this nontraditional compounding area where the volume 
is larger, the distribution is larger, the products are more 
complex, where we think we lack the authorities that we need. 
And we appreciate that you are introducing legislation, and we 
will work actively with you----
    Mr. Markey. Thank you.
    Ms. Hamburg [continuing]. In order to an achieve the 
important goal.
    Mr. Markey. I think it is critical, given today's hearing, 
given what we have heard from the witnesses, the pain that it 
has caused, the regulatory black hole that obviously has to be 
closed, that we pass legislation that gives you these 
authorities----
    Ms. Hamburg. I agree with you.
    Mr. Markey [continuing]. So that children will have to look 
to the history books to find that there ever was such a 
catastrophe as is being suffered by hundreds of families across 
the country right now. And so I just hope that we can move 
quickly on legislation to give you that authority because I 
think you are the cop on the beat and we have to make sure that 
you have the authority which you need in order to enforce the 
law.
    And, Dr. Smith, I want to commend you and Governor Patrick 
for the decisive manner in which you have responded to this 
tragedy. You have undertaken an aggressive investigation and 
held the companies involved and some members of your staff 
accountable and put in place stringent emergency regulations 
for compounding pharmacies in Massachusetts.
    We have learned that this tragedy was enabled by a 
regulatory black hole that allowed a drug manufacturer, NECC, 
to masquerade as a pharmacy, producing massive amounts, 
quantities of drugs with little or no Federal oversight, and 
able to sell these vials all across the country to dozens of 
States without full Federal regulation.
    And there were complaints that had been reported as long as 
10 years ago. Starting in 1999 with the first complaint, State 
regulators repeatedly failed to take strong action, such as 
withdrawing NECC's license in 2006. The State even waived the 
company's proposed probation as long as it got a clean bill of 
health from an independent evaluator. But when that same 
independent evaluator was convicted of selling unsafe medical 
sterilization equipment that blinded 18 patients, Massachusetts 
did nothing to make sure the clean bill of health that the New 
England Compounding Center had received was reexamined.
    Dr. Smith, have you been able to determine why those 
decisions were made back then through interviews with the staff 
that were there at that time?
    Ms. Smith. No, we have not. We have done interviews, as you 
allude to, and we have not been able to really understand why 
they made those decisions. In retrospect, clearly there were 
missed opportunities for the Board of Pharmacy, as you point 
out, in 2006 to take decisive action, and it did not. And we 
are trying to understand that, but we don't at this point.
    Mr. Markey. Are all of those individuals' emails and other 
documents from that period available for review?
    Ms. Smith. Yes. We have--we produced for this committee 
thousands of--thousands of pages of emails. And those are all 
being reviewed.
    Mr. Markey. Is it possible that some of those emails and 
documents have been destroyed in the period of time from 2006 
and prior to today?
    Ms. Smith. Well, I am not--I wouldn't be sure of that. I 
can tell you that the numbers of emails from the earlier, prior 
years are far fewer than what we have been able to obtain more 
recently.
    Mr. Markey. So Massachusetts is, in the very near future, 
going to have the strongest compounding pharmacy regulation in 
the country. But that does not protect us, does it, from other 
States having weak laws, which could then sell compounded drugs 
into Massachusetts----
    Ms. Smith. That is correct.
    Mr. Markey [continuing]. Or the other 49 States?
    So you just heard the list of powers which I asked Dr. 
Hamburg if she would support being given to the FDA. Do you 
support giving the FDA those same powers so that they can be 
the national cop on the beat to protect against one State 
becoming the place where a rogue compounder then terrorizes and 
harms the rest of the country?
    Ms. Smith. Absolutely.
    Mr. Markey. I thank you. I thank all of you for your 
service.
    And I thank you, Mr. Chairman.
    Mr. Stearns. I thank the gentleman and recognize Dr. 
Burgess for 5 minutes.
    Mr. Burgess. I thank the chair for the recognition.
    Dr. Hamburg, again, thank you for being here today.
    Let me ask you, you made a statement a minute ago in 
response to another Member's question that you favored a risk-
based system; is that correct?
    Ms. Hamburg. We do favor a risk-based----
    Mr. Burgess. Let me just stop you for a second, because, I 
mean, this country was--company was bad news from the day it 
started back in the '90s. They, as is my understanding from 
looking at the materials provided to us, they shipped 
preprinted prescription forms to various clinics around the 
country in clear violation of what they should be doing.
    And then you have--the FDA, not you, but the FDA has 
assembled a 10- or 15-year history of repeated violations and 
areas where this company has shown itself to be unsafe. So if 
you want to have a risk-based system, this company is too 
risky. You can't risk it. Don't do a risk-based system for this 
company. It is through. And, in all honesty, it should have 
been terminated by the FDA, multiple branch points along the 
way--2002, 2004, 2006, 2008. We see the documents. It should 
have happened.
    Now, I guess, listening to your testimony today, I must be 
given to believe that what you have been doing is collecting 
the data set so that what Congress finally passed a law to 
allow you to prevent this from happening you would then prevent 
it. Is that what I am understanding? That you lack complete and 
total authority to do anything at all even though you saw this 
stuff happening?
    Ms. Hamburg. You know, we worked very hard when the first 
problems at NECC were identified with the State to address them 
aggressively. But our authorities around compounding pharmacies 
are unclear, limited----
    Mr. Burgess. Yes, let me stop you.
    Ms. Hamburg [continuing]. And untested.
    Mr. Burgess. We have been down this road before----
    Ms. Hamburg. We need----
    Mr. Burgess [continuing]. And we are not buying it. We are 
just not buying it, Dr. Hamburg, in all honesty.
    You have an evidence binder in front of you. Tab 15, look 
at it, if you will. It is a letter dated October 31st, 2008. We 
have heard other people reference a 2006 letter where the FDA, 
the FDA, in writing to this compounding pharmacy, say, 
``Failure to do so may result in an enforcement action, 
including a seizure of the firm's products and/or an injunction 
against the firm and its principals.'' That is pretty strong 
language.
    Now, you lacked the authority to do anything and yet you 
sent a letter like this? Was this letter sent in error? You 
really didn't have that authority, and it was an empty threat; 
is that what I am to understand?
    Ms. Hamburg. As, you know, was pointed out, I was not 
present at the FDA at the time, and I cannot speak to all of 
the issues. But there--clearly, there was an effort to assert 
authority----
    Mr. Burgess. Well, let me just ask you----
    Ms. Hamburg [continuing]. Around an issue that was very 
different than the issue about sterile compounds----
    Mr. Burgess. OK. But this letter was issued in error; is 
that what I am to understand? It was an error, that the FDA 
sent this, even though it was a previous administration, a 
previous Commissioner?
    Ms. Hamburg. There were--in 2004, the FDA was asked to take 
a look at an issue that involved a specific product, Trypan 
Blue, and whether or not NECC was making it inappropriately.
    Mr. Burgess. OK. With all due respect here--and our time is 
limited. I don't mean to be rude, but we really have to pursue 
this.
    Did you, did anyone at the FDA, previous Commissioner, 
previous administration, did anyone get a legal memo from your 
legal department saying, ``Hey, you didn't have the authority 
to do that, so you better back off''? Is there such a memo in 
existence?
    Ms. Hamburg. There was a lot of internal discussion. The 
courts were split on what our authority----
    Mr. Burgess. So was there a memo delivered from the 
Commissioner?
    Ms. Hamburg. Well, at that time, there was ongoing 
litigation, and----
    Mr. Burgess. May we on the committee have access to those 
internal memos that said you didn't have the authority to write 
that letter?
    Ms. Hamburg. That isn't what I said, and I apologize if it 
came across that way. What I was saying was that an inspection 
was done in response to a specific complaint, and then, with 
respect to the actions taken, there was ambiguity in the law, 
ongoing litigation----
    Mr. Burgess. Yes, but there is no ambiguity.
    Ms. Hamburg [continuing]. Discussions within FDA, as I 
understand it, about----
    Mr. Burgess. OK, let me try it from another perspective, if 
I could.
    Ms. Hamburg [continuing]. What enforcement could be used to 
take action.
    Mr. Burgess. We all saw on television the company being 
raided, the computers being seized. Did you do that and you 
didn't have the authority to do that?
    Ms. Hamburg. In the--I mean, you are asking me about one 
specific question that had to do with the warning letter, which 
is a very discrete and different problem than what we are 
talking about----
    Mr. Burgess. But you assert an authority which you are now 
telling us you don't have in that letter. Now----
    Ms. Hamburg. I think you just need to look at the map and 
see that the authority that is used to oversee compounding 
pharmacies is very fragmented. We have different court 
decisions applying different legal regulatory frameworks to 
different parts of the country that cannot serve patients well.
    We need to have a strengthened and clarified legal 
regulatory authority that gives us some of the additional 
authorities over----
    Mr. Burgess. OK. Once again, let me just ask you as 
straightforward and simply as I can, do you have the authority 
to regulate the manufacturer, or if a compound is--of the 
manufacturer of these compounds or if the drug is adulterated 
in some form? Do you have that authority, as it exists today?
    Ms. Hamburg. We have many more authorities over drug 
manufacturers than compounding pharmacies. And that limits our 
ability to effectively ensure the safety and quality----
    Mr. Stearns. Dr. Hamburg----
    Mr. Burgess. Well, again, let me just ask it in the 
simplest way that I can. How many companies are out there 
labeled as compounding pharmacies that ship 17,000 doses of 
sterile, preservative-free steroids every year?
    Ms. Hamburg. The problem is that compounding pharmacies are 
not required----
    Mr. Burgess. How many? The question is, how many?
    Ms. Hamburg [continuing]. To register with us. We don't 
know how many compounding pharmacies are, in fact, engaging in 
those kinds of practices.
    What we do know is that the industry, though, has evolved 
and that there are an increasing number of nontraditional 
compounders who are acting, for example, with hospitals and 
clinics----
    Mr. Burgess. Look----
    Ms. Hamburg [continuing]. Are outsourcing to them----
    Mr. Burgess [continuing]. We heard testimony from the widow 
of a victim. And you could tell that there was some bitterness 
in her voice against the company--or, the clinic that had 
provided the steroid injections. ``How could they buy it from 
someone if they weren't sure?''
    But, you know, I am a doctor, you are a doctor, Dr. Smith, 
you are a physician. I mean, you take a vial off the shelf, you 
make some assumptions as to its potency and its sterility. In 
this country, we stipulate that, because you have done your job 
at the FDA, we don't have to come and ask additional questions 
before we administer that to a patient.
    Now you are telling me that that is not the case and that 
the FDA lacks the authority to assert that the safety and 
effectiveness of those medicines that are coming off the shelf 
is, in fact, valid?
    Ms. Hamburg. We have the authority with drug manufacturers 
to oversee the safety, efficacy, and manufacturing quality.
    Mr. Burgess. Correct.
    Ms. Hamburg. We do not have----
    Mr. Burgess. And if you are making 17,000 doses of sterile, 
preservative-free, injectable steroids every year, you are a 
manufacturer. There is no other word for it.
    Mr. Stearns. The gentleman's time has expired.
    Mr. Burgess. I thank the gentleman.
    Mr. Stearns. Let the record show, Dr. Hamburg, he asked you 
a question. You are under oath. You have an obligation to 
answer ``yes'' or ``no.''
    Ms. DeGette. She tried to answer----
    Ms. Hamburg. I was attempting to, and----
    Mr. Stearns. And let the record show----
    Ms. Hamburg [continuing]. I am sorry if I did not.
    Mr. Stearns [continuing]. That Dr. Burgess asked you a 
question time and time again, the same question, and you would 
not answer ``yes'' or ``no.''
    Let me recognize----
    Ms. Hamburg. We do not have the authority over compounding 
authorities----
    Mr. Stearns. That is--Dr. Hamburg, we understand that.
    Ms. Hamburg [continuing]. That we have over drug 
manufacturers.
    Ms. DeGette. Wait a minute.
    Mr. Stearns. The gentlelady from Florida, Ms. Castor, is 
recognized for 5 minutes.
    Oh, Ms. Schakowsky. Oh, I am sorry. Yes, welcome.
    Ms. Schakowsky. This is for Dr. Smith.
    In the aftermath of this tragedy, we have learned some 
troubling facts about the Massachusetts Board of Registration 
and Pharmacy and how it dealt with NECC in the past. And it 
raises some questions about whether the board was too close to 
NECC and whether the board did enough to prevent conflicts of 
interest from affecting its decisions.
    So I wanted to ask you, Dr. Smith, about Sophia Pasedis, 
one of the members of the board. I understand she is gone now; 
is that true?
    Ms. Smith. No. We have asked her to resign, but she 
declined.
    Ms. Schakowsky. So how long has she served on the board?
    Ms. Smith. I don't have that in front of me, but it has 
been for several years. She was there in the previous 
administration.
    Ms. Schakowsky. And what is her affiliation with NECC or 
its sister companies?
    Ms. Smith. She had previously worked for NECC. I am sorry--
she started in the summer of 2004. She had previously worked 
for NECC and then subsequently went to Ameridose, a company 
that was also owned by Mr. Cadden.
    Ms. Schakowsky. So I understand that she was actually vice 
president of regulatory affairs and compliance at Ameridose.
    Ms. Smith. Yes. And she is the pharmacy of record there.
    Ms. Schakowsky. Did Ms. Pasedis adequately recuse herself 
from board actions related to these companies?
    Ms. Smith. In our review of the minutes of the board 
meetings, it is clear that on several occasions there is a 
specific indication that she did recuse herself. However, there 
are some minutes that don't--that are silent on the issue, 
don't say either way. And because of that, the fact that it was 
unclear she appropriately recused herself--although in 
interviews she declares that she did--because of the lack of 
clarity, we asked her to resign, which, as I said, she 
declined.
    Ms. Schakowsky. So I am glad that you attempted to take 
action to remove her, but there is still a lot of questions 
about whether her role on the board during much of the time 
when Massachusetts was receiving complaints softened the 
actions of the board that the board was willing to take against 
NECC.
    In 2004, after first identifying significant problems at 
NECC, the board proposed a tough consent agreement with real 
sanctions. But something happened in the interim, and the 
consent decree that was actually signed in 2006 was much weaker 
than in the initial proposal.
    Do you know how this happened and why the board proposed 
weaker penalties even after they had received additional 
reports of problems at NECC?
    Ms. Smith. We don't know how that happened, and, as I 
mentioned, we are very interested and have been attempting to 
find that out. Our interviews with board members about that 
precise issue have been--have not yielded definitive 
information. Most simply state that they don't recall.
    Ms. Schakowsky. So one of the problems with the 2006 
consent agreement was that it required NECC to be independently 
audited but then let NECC have significant input into who its 
independent evaluator would be.
    So, Dr. Smith, did NECC participate in the selection of PSI 
as its independent auditor--evaluator?
    Ms. Smith. Well, we are unsure. We have been reviewing the 
records to, in fact, try to determine who did make the final 
decision regarding who that independent evaluator should be. 
And it is unclear, from the documents that we have found, who 
did do that.
    Ms. Schakowsky. And is it common for a party to help select 
its own evaluator?
    Ms. Smith. I can't speak to whether or not it was common. 
You could certainly imagine that that would be problematic. But 
we haven't been able to determine who, in fact, chose the 
evaluator.
    Ms. Schakowsky. Is it still the practice?
    Ms. Smith. Well, it would be--currently, I am not aware of 
any current actions that are involving an outside evaluator. As 
we proceed, as I mentioned, we are really looking at both the 
best practices around other States for the Board of Pharmacy, 
and so that would be the kind of thing we would include.
    Ms. Schakowsky. Well, let me just say, at the time that PSI 
was selected to act as an independent evaluator, one of its 
executives, Ross Caputo, was facing trial for defrauding the 
FDA and selling unapproved sterilization equipment to hospitals 
that caused blindness in patients. And he was later convicted.
    So in 2006 your agency sent a letter to NECC telling them 
that they had ``satisfactorily completed,'' unquote, the 
conditions of the consent agreement based on NECC's compliance 
with the follow-up actions identified in PSA's audit report of 
the company; is that correct?
    Ms. Smith. That is correct.
    Ms. Schakowsky. So were any of the Massachusetts Board of 
Registration and Pharmacy staff aware of Mr. Caputo's Federal 
conviction when they found NECC had satisfactorily completed 
PSI's recommended actions?
    Ms. Smith. As far as we can tell through our interviews 
with staff and the board members, they were not made aware of 
the fact that the primary evaluator, Mr. Caputo, had, in fact, 
been convicted of those Federal crimes. The staff were aware, 
but, as I have mentioned, and shockingly so, they did not share 
that information with the board.
    Ms. Schakowsky. Well, you know, we have turned up a number 
of problems, but, one, it seems that the NECC was too close to 
the board and its members, and it seems like the board was more 
interested, maybe, in protecting pharmacists than in protecting 
consumers.
    We have a lot of work to do, but it seems like that some of 
the solutions that we have laid out, at least on the Federal 
level for the FDA, are fairly clear. And I am hoping that at 
the State level, as well, that these problems will be--you will 
get to the root of them.
    Thank you.
    Mr. Stearns. The gentlelady's time has expired.
    The gentleman from Pennsylvania, Mr. Murphy, is recognized 
for 5 minutes.
    Mr. Murphy. Thank you.
    Dr. Smith, in your testimony, you had stated that you have 
uncovered a number of problems where PSI executives and others 
did not provide information to people. You said you have found 
no evidence to indicate the executive directors or staff 
attorney of the board provided crucial information to the 
board, and yet the board had to vote on something without that 
information. Am I correct?
    Ms. Smith. That is right.
    Mr. Murphy. And you have given a number of other examples 
of a breakdown within the structure and have taken action 
toward people when you found that they were not properly 
informing or following the rules?
    Ms. Smith. That is correct.
    Mr. Murphy. OK. Is there anything also within the laws, as 
you understand it, that you have the authority within 
Massachusetts, are required, to pass information up to the FDA 
on any of these problems that occur?
    Ms. Smith. There is nothing in our practices or our 
regulations that I am aware of that requires that kind of 
information share.
    Mr. Murphy. Do you do it anyway?
    Ms. Smith. Certainly, since this investigation or this 
episode has begun, we have worked in partnership with the FDA 
and, in fact, have done all of the inspections together. That 
is an area, as I mentioned, when we move forward to determine 
what sorts of policies we should have about information 
sharing----
    Mr. Murphy. Thank you.
    Ms. Smith [continuing]. Whether it should be required as 
opposed to on a case-by-case basis.
    Mr. Murphy. It is helpful internally to identify those 
breakdowns, too.
    Ms. Hamburg, is there someone at the FDA who routinely 
reviews State actions and communicates with them from your 
level down to the States when there are problems occurring? Is 
there anybody who reads or reviews anything with the States at 
all right now?
    Ms. Hamburg. There is not a system in statute----
    Mr. Murphy. But is there anybody who does that?
    Ms. Hamburg [continuing]. Or in practice where there is 
that kind of back-and-forth communication on a routine basis. 
When there is a serious problem, as occurred in this case, you 
know, we mobilize into action very quickly. We have----
    Mr. Murphy. Who is it that is mobilized in the FDA to then 
work with States?
    Ms. Hamburg. Different components of FDA, depending on the 
nature of the problem.
    Mr. Murphy. Is there a particular person?
    Ms. Hamburg. We have district offices, and they are sort of 
the first line in terms of identification of a problem----
    Mr. Murphy. I am just trying to get some specifics here.
    Ms. Hamburg [continuing]. And responding----
    Mr. Murphy. I am trying to lay out here that Dr. Smith did 
a thorough internal review and found a number of breakdowns 
that people weren't communicating with one another.
    I am trying to find out within the FDA--regardless of 
regulations, obviously if someone with the FDA was talking to 
the States, someone has the authority to talk to States. And I 
am trying to find out if you have identified structural changes 
needed within the FDA to make sure you are communicating within 
FDA that information is coming to your desk for review. Have 
you made any of those changes or reviews?
    Ms. Hamburg. I think part of the issue here is there are 
not formalized systems. There certainly are opportunities to 
improve communication. But it also is a broader issue, that 
compounding pharmacies----
    Mr. Murphy. Hold on. Really, I am trying to help.
    Ms. Hamburg. Uh-huh.
    Mr. Murphy. And you are obfuscating.
    Dr. Smith, very cogent leadership, says, if there are 
problems, identify the problems, we went after the problems. I 
am just trying to find out, do you even have--you don't have to 
wait for authority to find out within the FDA who can have the 
authority to review these things. Do you have it, yes or no?
    Ms. Hamburg. We--well, I am not sure what authority you 
mean.
    Mr. Murphy. Well, the authority to review if there are 
problems with the States and manufacturing, et cetera.
    Ms. Hamburg. We don't always get the reports is the issue. 
When we do get the reports, then we have our district offices 
and Office of Regulatory Affairs----
    Mr. Murphy. OK. Have you met with those people since from 
the district offices to review----
    Ms. Hamburg. Yes.
    Mr. Murphy. OK. Thank----
    Ms. Hamburg. We have been working very closely with them. 
And, you know, every day there are issues that involve our 
working with States----
    Mr. Murphy. Well, let me ask another area, too, in terms of 
identifying people. In terms of dealing with the definition of 
``compounding pharmacy'' versus ``manufacturer,'' who within 
the FDA is responsible for defining that?
    Ms. Hamburg. Well, the--it is not just in FDA. It is 
Congress----
    Mr. Murphy. But who is it that--who is the keeper of the 
definition that when you have a question----
    Ms. Hamburg. But our--our----
    Mr. Murphy. Who?
    Ms. Hamburg. Our chief counsel's office is----
    Mr. Murphy. Chief counsel. Have you reviewed with chief 
counsel the definition of ``manufacturing'' versus 
``compounding''?
    Ms. Hamburg. I think that everyone agrees that, at the 
present time----
    Mr. Murphy. I didn't ask you that.
    Ms. Hamburg [continuing]. That the law is not----
    Mr. Murphy. Please. Please, please, please.
    Ms. Hamburg [continuing]. Clear on this.
    Mr. Murphy. Please. I want to know, have you reviewed with 
someone--you said chief counsel--the definition of 
``compounding'' versus ``manufacturing''? Have you reviewed 
that with someone? When did that take place?
    Ms. Hamburg. You know, we have had many discussions on it, 
but the problem is----
    Mr. Murphy. So has someone reviewed with you a definition 
of ``manufacturing'' versus ``compounding''?
    Ms. Hamburg. You know, I think that, really, you know, 
unfortunately, there is not a clear----
    Mr. Murphy. Yes, there is. Because in your authority--if 
you are telling us the crux of your testimony today is you 
don't have authority under manufacturing, you therefore must 
have met with someone who told you what the definition of 
``manufacturing'' versus ``compounding'' is. I would like to 
know who that is. Or is it you?
    Ms. Hamburg. Well, you know, I really do think this is a 
broader issue. I know that you are frustrated by my answers, 
and I am sorry that I can't just give ``yes'' or ``no,'' but 
this is a very complex issue. The courts of our country are 
split on these issues.
    Mr. Murphy. Ma'am, that is not complex. Complex is the life 
that the 32 victims' families have now. That is complex. What 
you have to do is easy, ma'am. Children growing up without 
parents, people without a spouse, living that lonely life, 
that, I submit to you, is complex.
    Leadership is easy if you are willing to accept it. And you 
are not. Dr. Smith took leadership. She went in and cleaned 
house and identified problems.
    What you are telling me is all this smoke and mirrors, that 
you don't have authority. Go look in the eyes of the victims, 
and try and comfort them with that. Ma'am, that doesn't work.
    I am asking you a simple question, as everybody else has 
here. And you can't even tell us if you have talked to someone 
to come up with a definition of ``manufacturing.''
    Ms. Hamburg. No, I have told you we have been working very, 
very hard----
    Mr. Murphy. Tell us who----
    Ms. Hamburg [continuing]. To try to apply the authorities 
we have to an evolving industry and situations where we do not 
have the authorities we need. We don't even have registration 
of the compounding facilities to know who they all are. We 
cannot review the record. There are no Federal standards to 
which the compounding pharmacies are held. And the courts have 
not----
    Mr. Murphy. You should be able to provide us with a 
definition.
    Ms. Hamburg [continuing]. Been able to agree on what is the 
legal regulatory framework for examination of these problems 
and enforcement actions.
    I care deeply about the patients and the families. The 
mission of the FDA is to promote and protect health. We are as 
frustrated as you are that we don't have the authorities and 
the resources----
    Mr. Murphy. Then just tell us the definition, ma'am. We 
will move from there.
    I yield back. Thank you.
    Mr. Burgess [presiding]. The gentleman's time has expired.
    The chair now recognizes the gentlelady from Florida, Ms. 
Castor, 5 minutes, for your questions, please.
    Ms. Castor. Thank you very much.
    And I appreciate all of us coming together to focus on what 
we can do to prevent tragedies like this from ever happening 
again.
    Now, I do think it is clear that there is great ambiguity 
in the law. FDA--the law with regard to compounding pharmacies 
was last written in 1997; it is out of date. And from my 
colleague from Texas, there is ambiguity here, great ambiguity. 
And it has been made even more convoluted due to these court 
cases. And I wish we would bring this map up on the screen, as 
well, so folks watching outside this hearing room could see it.
    See, in 1997 the Congress passed the FDA Modernization Act. 
That law contained a provision, section 503(a), which dictated 
the circumstances under which compounded drugs were new drugs 
and subject to FDA regulation. In that law, Congress explicitly 
exempted compounders from oversight and regulation as 
manufacturers. So I know that is what they are struggling with 
in trying to answer questions here.
    Then the courts stepped in. And this is where I would like 
to follow up on Mr. Terry's question of you, Dr. Hamburg, about 
exactly which section of the act lacks clarity and his request 
that you direct him to it. We are talking here about the 
entirety of section 503(a), aren't we?
    Ms. Hamburg. Well, 503(a) applies in some areas of the 
country and not in other areas of the country, which is a very 
challenging situation----
    Ms. Castor. Yes. Let's look at the map.
    Ms. Hamburg [continuing]. In terms of our ability to be as 
effective as possible.
    Ms. Castor. Because in 2001, the ninth circuit, whose 
jurisdiction is the Western States, those red States, ruled 
that the advertising component of 503(a) was unconstitutional. 
And then they said that the rest of 503(a) is void because it 
is inextricably tied to the advertising component.
    Then, a few years later, in 2008, the fifth circuit court, 
the blue States there to the south, whose jurisdiction includes 
Texas, Louisiana, and Mississippi, ruled that the 
unconstitutionality of the advertising restrictions did not 
affect the rest of 503(a). And, unfortunately, the United 
States Supreme Court did not speak to break the tie to provide 
clarity.
    So, Commissioner Hamburg, what has been the impact on FDA 
in its regulation of compounded drugs as a result of these 
split court decisions?
    Ms. Hamburg. It has created a very challenging situation 
where we have, you know, contrasting legal regulatory 
frameworks for our actions. 503(a) applies in some places, and 
it does not--the other tool that we have is our compounding 
guidance that was written in 2002, but that doesn't have the 
force of law. It just lays out our best thinking about how to--
--
    Ms. Castor. So then the States have primary responsibility 
over compounding----
    Ms. Hamburg. It is very clear that States have the day-to-
day, routine responsibility for overseeing compounding 
facilities.
    Ms. Castor. And then you have an industry that has evolved, 
that now some of the compounders, when you think of the 
pharmacy on the corner, where it is very important that a lot 
of our neighbors get their customized compounded drug, but some 
of them now are very sophisticated enterprises that are 
shipping all over the place, and they are not--they don't--they 
have outgrown the 1997 law.
    So now we have to decide how we are going to update it to 
address the sophistication of compounders out there, and then 
go after these bad actors. Because I think the majority of 
these compounders are on the up and up, living up to high 
standards. But the compounding--this is the map from the 
compounding industry and association, and I am afraid that that 
has led to some of the bad actors being able to take advantage 
of this situation and the gaps in regulatory authority.
    Is that a good summary? Is that an accurate summary?
    Ms. Hamburg. That is an excellent summary. And I appreciate 
your trying to help me explain this, because it is just an 
extraordinarily complex situation where, you know, the effort 
to----
    Ms. Castor. Except I don't think that it is overly complex. 
I think there is a difference in outlook here on whether you 
have certain authority. And I think it is clear under the 1997 
law and these court cases that compounders were exempted and 
are not manufacturers.
    So we, the Congress, has the responsibility now to act and 
clarify it. And there has to be additional oversight of the 
States. If the States--if they are going to drop the ball and 
they are not--they are going--they are not going to provide 
proper oversight, then it is time for the Feds to step in and 
give FDA the tools it needs to prevent these tragedies from 
ever happening again.
    Thank you. I yield back.
    Ms. Hamburg. I don't know if I am allowed to make a 
comment, but I think, you know, that speaking to the complexity 
of the issue and the changing, evolving industry overlaid on 
top of a fragmented and ambiguous legal framework, it is 
important to understand that this notion of sort of black and 
white, compounder or manufacturer, you know, it just is trying 
to fit a square peg into a round hole.
    And, in fact, you know, if the law is examined, it isn't 
really adequately defined, but there is this area of 
outsourcing pharmacies that is increasingly important in 
medical practice. And if we were to define all of those 
pharmacies that hospitals now use--they used to make--Dr. 
Burgess, you would appreciate this. You know, it used to be 
that a hospital would add the potassium chloride to the IV bag 
in their local--in their basement pharmacy or on the floor and 
give it to the patient. Now, both because of volume and, you 
know, concerns about making sure it is made under the best 
possible practices, that is outsourced to a pharmacy. They are 
making a product in larger volume and often not making it with 
a patient prescription in hand, yet it is, you know, clearly 
serving an important medical need.
    And if we were to treat them as drug manufacturers, that 
would be simply impossible. They would have to submit an 
application, a formal application, to FDA for review and 
action. They would have to pay fees associated with that, as 
well. They would have to be subject to good manufacturing 
practice.
    And so I think we want to work together to make sure that 
we have a law that clearly defines critical issues and 
authorities, that enables important patient needs to be 
addressed, but clarifies the different roles and 
responsibilities, and puts in place some critical authorities 
that are currently missing.
    Mr. Burgess. I am going to interrupt you there in the 
interest of time. Dr. Gingrey has been waiting patiently.
    And, Dr. Gingrey, you are recognized, 5 minutes for 
questions, sir.
    Mr. Gingrey. Mr. Chairman, thank you very much.
    And, of course, an extremely interesting and important 
hearing. Tragic in so many ways, of the lives lost and the 
number of cases of meningitis as a result of this bad actor.
    Dr. Hamburg, Dr. Smith, pediatricians both, we appreciate 
your being here.
    And some of the questioning, the line of questioning from 
both sides of the dais, both Republicans and Democrats, have 
being pretty tough, but they have to be. Because if we are 
going to change the law, if we are going to rewrite the Federal 
Food, Drug, and Cosmetic Act, particularly in regard to section 
503(a) and the vagueness of that section and the conflicting 
court decisions, then we have to get this right. And I have 
some great concerns that we might not get it right, in regard 
to overreacting in regulating compounding pharmacies.
    Every Member of the House of Representatives have 
drugstores. And they are not chain drugstores; a lot of them 
are just corner druggists that do compounding, where a certain 
product is needed by a patient, but maybe the manufactured 
product, it is in a base or something that they are allergic 
to, so therefore the local pharmacist has to reconstitute that 
drug--not manufacture a drug; the drug is manufactured--and 
just put it in a different way of giving it to the patient. It 
might even be in a pellet form. Think hormone replacement 
therapy, in some cases, or a cream or a vanishing cream or 
something that the patient is not allergic to.
    So if we get to the point in the line of questioning that 
Dr. Hamburg received from our longstanding member emeritus, Mr. 
Dingell, about compounding pharmacies, that worries me a little 
bit, that we might overreact and get to the point that we are 
not getting at the problem.
    It seems to me that this particular company, this New 
England Compounding Company, was an unusually bad actor, 
unusually egregious. And I would be very surprised if there are 
not multiple lawsuits and, in the final analysis, some folks 
serving some jail time.
    And, you know, again, I can't understand why--Dr. Smith, I 
will direct this to you. I realize you have only been in this 
position for a few months. And by all appearances and from what 
I read, you are doing a commendable job. But, gosh, this 
company is going back to 1998, and a bright light has been 
shining on it at least since 2002. And there has to be some 
connection between members of this Massachusetts Pharmacy 
Board, I guess appointed by the Governor, I don't know for what 
period of time. And I think we have some evidence that there 
was some cross-pollination, where maybe even one of these 
individuals served on the board of the New England Compounding 
Center or one of these sister companies. And, you know, it is 
just unbelievable.
    The general public is so disgusted with Washington. I mean, 
you look, we are reading about what is going on now at the 
highest level of our military. And this situation where, in the 
21st century, we have a Food and Drug Administration and we 
have State pharmacy boards, that something like this could 
happen. It is, like--it is almost beyond belief.
    But it makes me think back to what President Reagan said in 
reference to the Russians and their nuclear stockpile: ``Trust, 
but verify.'' And that is the responsibility of this committee, 
this Oversight and Investigations Subcommittee of Energy and 
Commerce. Trust, but verify. And we are not very trusting 
today, as you can tell from our line of questioning. And we 
shouldn't be.
    That judge, his widow in the previous panel talked about 
his contribution to society in the great State of Tennessee. 
And his life was lost, but he was just one of how many? Well, 
we are talking about far too many people.
    So I would just in my last second ask you, Dr. Hamburg--and 
maybe Dr. Smith could comment, as well--do you think that the 
FDA needs, because of this, to all of a sudden have us change 
the law so that you and the FDA, or whoever succeeds you, has 
this broad authority over these little compounding pharmacies 
all across the country who are doing the right thing? They are 
not manufacturing drugs; they are just trying to provide a 
service, indeed, based on a prescription that has to be 
written.
    This company was an absolute crooked operation, and they 
killed people. But I don't think anybody here should get 
confused between them and the typical compounding pharmacist at 
our corner drugstores all across our districts.
    Ms. Hamburg. Yes. Well, I think we need a tiered approach, 
and that is what we are proposing in terms of the need for new 
legislation. I think that, clearly, the traditional compounder 
working locally is most appropriately overseen by the State. 
But this isn't, sadly, an isolated incident. This is the worst 
and most tragic, and it should be the last wake-up call to us. 
But over a period now of, you know, almost two decades, there 
have been problems with compounding facilities, compounding 
pharmacies.
    And I think it reflects this gap in regulatory oversight 
and the fact that we really need a strong, clear, and 
appropriate legislation. We cannot have a crazy quilt where 
different parts of the country are subject to different legal 
frameworks for oversight. We need a tiered system that 
recognizes the role of traditional compounding and the role of 
the States; nontraditional compounding, which represents higher 
risks, and there should be Federal standards.
    And we need to look at a set of statutorily based criteria, 
factors that in some combination would put people into this 
category: the type of product or activity, whether it is 
sterile processing, for example, the amount of product being 
made, whether it is in interstate commerce, whether it is going 
directly to the end-user or through a third party, and the 
nature of the anticipatory compounding.
    And then there are some things that just simply shouldn't 
be compounded, that should be manufactured by drug 
manufacturers subject to the full force of FDA authorities. And 
that would include, you know, certain things that you are well 
familiar with: extended release, transdermal, biologics, and 
other kinds of products that, because of the nature of the 
manufacturing, they really should be made in accordance with 
good manufacturing practice. They should be subject to the FDA 
preapproval review for safety, efficacy, and quality 
manufacturing----
    Mr. Gingrey. Dr. Hamburg, thank you. I have gone way beyond 
my time, and I really appreciate the chairman's indulgence. And 
I yield back.
    Mr. Stearns [presiding]. Sure.
    The gentleman from Texas, Mr. Green, is recognized.
    Mr. Green. Thank you, Mr. Chairman.
    I think the questions and the testimony here today showed 
from all three panels the problem we have. The NECC tragedy 
laid bare a regulatory gap that we have between the practice of 
traditional pharmacy compounding and full-scale drug 
manufacturing.
    There is no debate that we want the Federal Government to 
license individual pharmacists. That is a State responsibility. 
Nor is there a debate about whether FDA should oversee large-
scale manufacturing of drugs, which is I think on a bipartisan 
basis what we have heard.
    There have been overwhelming numbers of signals, though, 
about NECC, which is not your average neighborhood pharmacy.
    Commissioner Smith, how many different States did NECC sell 
their products to?
    Ms. Smith. I am not sure about all of their products, but 
in terms of----
    Mr. Green. But they did sell it into a lot of States. Did 
they did sell it into Massachusetts?
    Ms. Smith. Yes, they did. Twenty-three, I believe, is where 
they----
    Mr. Green. Twenty-three States? But did they sell their 
products in the Massachusetts market?
    Ms. Smith. Yes.
    Mr. Green. OK. How many States did it send the contaminated 
injections that led to the outbreak?
    Ms. Smith. That was the 23.
    Mr. Green. OK.
    Ms. Smith. They may sell into more, but that was the 23.
    Mr. Green. NECC was not new to this nationwide shipping. 
Hadn't they been operating throughout the company--the country 
for about a decade?
    Ms. Smith. That is correct.
    Mr. Green. The Massachusetts Board of Pharmacy had been 
getting complaints and troubling sings from States around the 
country for that whole period of time. The board received 
complaints from Idaho and New York that NECC was 
inappropriately soliciting business. The board received a 
report from South Dakota pharmacists that NECC was sending 
blank forms for dosage size that you never use on one person. 
The board received adverse event reports from NECC products 
from Florida and New York. And the board received complaints 
from pharmacists in Texas and Iowa on how NECC was soliciting 
and filling prescriptions. The board also received reports of 
cease-and-desist orders for NECC for in Colorado.
    Dr. Smith, red flags came from across the country, and I 
can go over that list of States again. Wasn't it obvious that 
NECC was operating on such a large scale that it presented a 
nationwide problem of a sort that warranted greater involvement 
by the Federal Government?
    Ms. Smith. Yes.
    Mr. Green. Did the board in Massachusetts request any 
assistance from the FDA?
    Ms. Smith. I am not aware of any specific requests. 
However, there were--certainly, during this most recent 
outbreak, we have worked together, and----
    Mr. Green. OK. But they have been doing this for 10 years. 
And you all have records of it. Did you share those records 
with the FDA, those complaints?
    Ms. Smith. I am not aware--I do not recall. I would have to 
look back to check, so I don't know the----
    Mr. Green. Well, and I think that is our problem. And I 
have been on the committee since '97. We never included Federal 
regulation or compounding pharmacists because, frankly, I 
don't--that is licensing, and that is the State. But when they 
are in the manufacturing situation, which they are, then that 
means they should have been covered by Federal law.
    And I know it is complicated and it is hard for a doctor to 
explain legal; it is hard for lawyers to explain some of the 
legal theories that the courts do. But that is the decision I 
think Congress needs to make. And I think we have a bipartisan 
agreement, this subcommittee doesn't do legislation. But, 
believe me, the Health Subcommittee can.
    And I don't know if we can do it by the end of the term. 
And I know our chairman is not here, and even our ranking 
member. But I would hope that we could look at a very quick 
piece of legislation that we could have a hearing on and to 
correct this problem.
    Because if you are a compounding manufacturer in Texas and 
selling in interstate commerce, it ought to be Federal law 
covering it. I don't expect our local pharmacy board in Texas--
they go around and inspect my pharmacists, whether they be in 
the large pharmacies like Walgreens, in our case, or CVS, I 
know a Rite Aid here, or our neighborhood pharmacists. But they 
don't inspect, necessarily, the compounding manufacturers. And 
that is where Federal law needs to come.
    And I will be glad to yield to my colleague, and I would 
hope that we would see movement on the bill on a bipartisan 
basis. Thank you.
    Mr. Markey. Thank you.
    Let me ask you this, Dr. Hamburg, when you try to inspect 
compounded drugs, do you get sued by the compounding industry?
    Ms. Hamburg. We have been sued on numerous occasions, and 
we have been challenged in terms of our authority.
    Mr. Markey. When you try to regulate compounded drugs as 
new drugs, do you get sued by the compounding industry?
    Ms. Hamburg. We do not. The authority there is very clear, 
the expectations on drug manufacturers in terms of what they 
need to do to comply with FDA law.
    Mr. Markey. When you request documents from compounding 
firms, do they sue to block you from getting----
    Ms. Hamburg. You know, we often have to go to the courts 
and get warrants in order to get the materials that we need. We 
do not have the full authority that we need to review 
documents.
    Mr. Markey. When you are asking a drug company, Merck, when 
you request documents from them, do they go to court?
    Ms. Hamburg. No, we have much clearer authority over drug 
manufacturers.
    Mr. Markey. When you are inspecting Merck, do they question 
your authority to inspect?
    Ms. Hamburg. No, they do not.
    Mr. Markey. And that is why she needs authority. That is 
why the FDA needs authority. Because it is clear that the drug 
companies accept the law and the FDA's authority.
    Mr. Green. As much as I agree with my colleague from 
Massachusetts, I yield back my time, but I would hope our 
committee hearing has done what we need to do and can 
encourage----
    Mr. Stearns. Will the gentleman--I think his comments were 
very appropriate and bipartisan, and I appreciate that.
    Do you think in your heart of hearts that the Energy and 
Commerce Health Subcommittee should provide more regulation and 
authority to the FDA before the end of the year?
    Mr. Green. I think we ought to respond to the tragedy that 
happened, and I think we owe it to the families, but also to 
probably thousands of people who may not have been subject to a 
death in their family but an illness because of the practices 
of this particular compounding company. It happens to be in 
Massachusetts, but it could have been in any other State. But 
Massachusetts did have warning. There were complaints for 10 
years about it.
    And I would hope that we would have better interstate 
sharing between the States and the Federal regulatory agencies, 
even though they may not have had the authority, but somehow, 
in 10 years, they could have come to us and maybe we could have 
given it earlier.
    Mr. Stearns. I thank the gentleman.
    The gentleman from Virginia, Mr. Griffith, is recognized 
for 5 minutes.
    Mr. Griffith. Thank you, Mr. Chairman, I appreciate it, and 
obviously, this is very frustrating. You know, I would like to 
know what kind of due diligence the FDA has the authority to 
do? Do you send out letters to doctors saying, where are you 
getting your compound medicines from, or where are you getting 
your supplies from? And the reason I ask that, and the same 
thing for hospitals, or clinics, or other medical providers, 
because this was not what we think of as compounding. This was 
manufacturing. In my small area, which is, you know, it 
overlaps the Roanoke Valley, the New River Valley, we have 
compiled a list of approximately 1,415 patients who were 
advised based on press reports, they were notified they could 
have been exposed to fungal meningitis through the tainted 
steroid injections and other products made by the New England 
Compounding Center, and we have, you know, a hospital that 
didn't, fortunately, use it, but had it sitting on the shelf. 
We had--that was at the Carilion Giles Community Hospital. We 
had the Insight Imagining in Roanoke and the New River Valley. 
We had other clinics, including Vista Eye Center, LewisGale 
Medical Center in Salem, and Carilion Roanoke Memorial, all of 
which had these products.
    And when you have that many, you know, I don't represent 
New York City. This is a fairly, compared to other parts of the 
country, a fairly small area, and we have got 1,415 people who 
have to worry about whether or not they are going to get the 
disease. We have more than that who have already contracted it, 
roughly 50 confirmed cases in the area. Three of those, so that 
I am being fair, were across the line in West Virginia, but not 
that far from our medical centers. And when you have got that 
many folks affected, we are not dealing with a compounder, 
which is why it has been frustrating all day, I think, for 
members of this committee, when you keep going, our 
jurisdiction is not clear. Your jurisdiction was clear; these 
folks were manufacturing.
    Now what due diligence did you take to find this out? 
Because these are all pretty big operations, and if you just 
sent them a letter saying, hey, who is providing you with 
various products? You know, I think they would have complied, 
and you would have had then the, you know, you didn't--FDA, not 
you--but did some work back under the Bush administration, but 
then it appears that the ball was dropped and that there was 
no--it appears there was no due diligence going on that you all 
weren't saying, hey, who is providing you with this stuff? 
Because you know what, we have got Colorado involved; we have 
not Tennessee involved, who made complaints in advance. And we 
have got 1,415 people who either live in my district, or Bob 
Goodlatte's predominantly, and you know, somebody wasn't paying 
attention.
    These were not our compounding. This was not your small 
compounding pharmacy. These were, in fact, manufacturers. And I 
recognize they were violating the laws, but it is very 
frustrating when you come in here and say, our authority wasn't 
clear. These folks were manufacturing. And what are you doing 
now to find out if there is somebody else out there who is 
manufacturing under the claim that they are not, I mean, you 
know, spending----
    Ms. Hamburg. Well, I think your question speaks directly to 
why we do need legislation and new authorities. Compounding 
pharmacies are not required----
    Mr. Griffith. All right, hang on, I am not worried about 
compounding. I am telling you that from the evidence I have 
heard today, it appears that these were manufacturers. So what 
do you all do to find out if somebody is manufacturing 
illegally, because that is what I think we have here? And you 
keep going back to compounding, and that is why everybody is 
getting frustrated with you; 1,415 cases, you know, a number of 
States away is not a compounder. That is a manufacturer.
    Ms. Hamburg. Well, I think we really do need to clarify 
that in legislation in terms of----
    Mr. Griffith. All right. I already heard that. Let me go on 
to another question because I have limited time like everybody 
else does.
    There was marketing going on, and I am going to switch to 
you, Dr. Smith. There was marketing going on. They apparently 
were aggressively marketing bulk pricing, discounts to the 
clinics. You are aware of that at this point?
    Ms. Smith. Well, yes, those were some of the claims, or the 
issues that had come up before.
    Mr. Griffith. OK, and I guess if they are aggressively 
marketing to multiple States, did it--are there any memos, I 
know you weren't there, and I appreciate you coming forward and 
saying, look, mistakes were made. Did anybody think, hey, wait 
a minute, this is not traditional compounding, this is a 
manufacturer, we need to turn this over to the FDA and let them 
deal with them as manufacturers? Because that is what the 
evidence--notwithstanding the FDA not wanting to accept some 
responsibility today at all, that appears to be what happened 
here, is that somebody was violating the law, and pulling a 
fraud and claiming they were compounders when they were in fact 
manufacturers. Did that ever come up in any of the notes or the 
memos that you have seen thus far?
    Ms. Smith. It hasn't come up, or we haven't found that 
level of conversation. What has been clear and remains clear, 
is that Massachusetts law requires one prescription per 
patient. And so the issue that has come up as you describe it, 
is that clearly you can't do that and still do one prescription 
per patient.
    Mr. Griffith. Right.
    Ms. Smith. One of the things we have done since this all 
has come to light is to, A, remind all pharmacies in 
Massachusetts of that; remind hospitals that if you are getting 
product, that it needs to be one prescription per patient, for 
exactly the reasons that we have been discussing.
    Mr. Griffith. Well, I appreciate that.
    And Mr. Chairman I know my time is up, and I appreciate 
this hearing being held. Earlier today you said, or somebody 
said there would be more hearings. I certainly hope there are, 
and I hope that we can get some answers on why and what we need 
to do, not on the compounding side but to make sure the FDA has 
authority, because apparently, they don't, to just check and 
see if we have people out there who are committing fraud on the 
public by claiming to be a compounder when they are in fact 
manufacturers.
    Mr. Stearns. I thank the gentleman.
    And I say to all the members we are going to go for a 
second round. I talked to the ranking member, she has agreed. 
It is not necessarily going to be the full 5 minutes, but if 
you--if the panel will be patient with us, there are no votes 
today, so we do have this unique opportunity to have a second 
round.
    I want to continue with a little bit what Mr. Griffith 
indicated. He sort of indicated going forward today, have you 
come up with procedures and interpretations so that the 
manufacturers out there that are doing the same thing as NECC, 
that you can stop them? And I didn't--you didn't seem to give a 
clear answer. So what assurance do we have in the public mind 
and legislators that the FDA is going to prevent this from 
happening today because we might not get legislation? This is a 
lame duck session, but the Republicans control the House; the 
Democrats the Senate. I mean, it is going to be very difficult 
to get legislation through normally, even though this is a very 
serious problem, and I think we are all bipartisan on this. 
Sometimes between the cup and the lip, it takes a while. So I 
think what Mr. Griffith was touching on is, what assurance can 
you give the public that the other NECCs that are out there, 
that you are going to stop them?
    Ms. Hamburg. Well, I do want to underscore that I believe 
that we need legislation----
    Mr. Stearns. So you cannot stop them unless you have more 
legislation?
    Ms. Hamburg [continuing]. To sanction and clarify 
authority. In the interim, we are working very hard, working 
with our colleagues at the State. I mentioned that we are 
actively engaging with the States in order to both provide our 
best possible information about best practices, et cetera.
    Mr. Stearns. Do you feel confident you could stop another 
NECC; with the jurisdiction and the understanding you have now, 
could you stop another NECC who is manufacturing drugs? Could 
you stop them today?
    Ms. Hamburg. NECC was not the first, and it will not be the 
last----
    Mr. Stearns. OK. All right.
    Ms. Hamburg [continuing]. Until we work together to clarify 
and strengthen the laws that surround----
    Mr. Stearns. Dr. Smith, you indicated in your opening 
statement that because of what happened, people have been fired 
and suspended. Is that true?
    Ms. Smith. Correct.
    Mr. Stearns. And you have also implemented new regulations 
and new oversight interpretation so that you can prevent this 
from happening again, is that correct?
    Ms. Smith. Yes.
    Mr. Stearns. OK. Dr. Hamburg, have you fired or suspended 
anybody at the FDA because of this tragedy? Yes or no?
    Ms. Hamburg. No.
    Mr. Stearns. OK, have you gone through, introspectively, 
looked at the agency and said, these are the regulations, these 
are the things we need to do to prevent another NECC? Have you 
done that?
    Ms. Hamburg. We have done that. We have been working very 
hard to identify what are the authorities that we need to be 
able to protect the American people and to help to ensure that 
they get the quality drugs that they deserve.
    Mr. Stearns. With the NECC incident, is it your position 
today that this could have been prevented by the Massachusetts 
Department of Public Health? Yes or no?
    Ms. Hamburg. I believe that we need a stronger regulation 
framework----
    Mr. Stearns. No, could they have, in your opinion----
    Ms. Hamburg [continuing]. But I believe that different 
actions might have been taken with NECC that could have----
    Mr. Stearns. See, the problem is that you are saying----
    Ms. Hamburg [continuing]. Prevented it, and I wish that 
that were so, but I think we just have to look at the record, 
that there has been----
    Mr. Stearns. Did somebody tell you to filibuster us? Is 
that why you are handling the questions----
    Ms. Hamburg. I apologize but, you know----
    Mr. Stearns. No, the question is----
    Ms. Hamburg [continuing]. This is an important issue, and I 
care about it.
    Mr. Stearns. You are saying you did not have the authority 
to stop this, is what you keep saying today; you don't have the 
authority to do it. Do you think that Dr. Smith's agency should 
have stopped it? Just yes or no. If you don't know, just say 
you don't know.
    Ms. Hamburg. Well, I think that clearly, Massachusetts was 
working very hard.
    Mr. Stearns. So you think they could have stopped it, and 
you didn't have to stop it.
    Ms. Hamburg. They were unsuccessful, and it is, you know, 
was tragic. We worked hard with them to limit the----
    Mr. Stearns. OK. OK. I understand.
    Ms. Hamburg [continuing]. Outbreak, and we want to work 
with you.
    Mr. Stearns. I have two more questions for you here. Is it 
your position today that the NECC was not a manufacturing 
pharmacy and that you had no jurisdiction over its business 
activities? Is that your position today?
    Ms. Hamburg. NECC is----
    Mr. Stearns. Yes or no.
    Ms. Hamburg [continuing]. Registered as a compounding 
pharmacy.
    Mr. Stearns. No, I am talking about NECC. Did they, in your 
opinion, in your opinion, this is the crux of the hearing now, 
it is your position today that the NECC was not a manufacturing 
pharmacy, and you had no jurisdiction over its business 
activity? Is that your position today? Yes or no?
    Ms. Hamburg. No, that is a subject of an ongoing 
investigation.
    Mr. Stearns. No, but you have been telling us all day 
today----
    Ms. Hamburg. I cannot characterize.
    Mr. Stearns [continuing]. That you had no jurisdiction, it 
is murky?
    Ms. Hamburg. I cannot characterize that while there is a 
criminal investigation that is underway.
    Mr. Stearns. Let me get more pointed. Is it your position 
today that the FDA could not have prevented this tragedy 
because you did not have jurisdiction, is that what you are 
telling me today?
    Ms. Hamburg. I, you know----
    Mr. Stearns. Yes or no?
    Ms. Hamburg. I am sorry, we can speculate----
    Mr. Stearns. You are in charge of the FDA. You are the 
chief honcho. You are the great poobah of the FDA, and I am 
asking you, basically, could you have prevented this tragedy, 
and you are saying you can't because you didn't have 
jurisdiction.
    Ms. Hamburg. It is very hard to know if any one action that 
we might have taken could have stopped this terrible tragedy. I 
wish that I could identify what that would be. What I can't----
    Mr. Stearns. FDA did nothing wrong, in your opinion?
    Ms. Hamburg. No, what I am--I am not saying that.
    Mr. Stearns. In 2002, when they inspected and found all of 
the problems, and 2006, when they wrote the letter and said, we 
are going to shut you down; I mean, all of that is just too 
murky for you, and you don't think the FDA has any 
responsibility?
    Ms. Hamburg. No, this is--this is not a forum, 
unfortunately, that enables us to speak to the----
    Mr. Stearns. Well, you can speak it pretty well. We have 
given you lots of time.
    Ms. Hamburg. I think that, you know, what we really want to 
do together is make sure that this kind of event----
    Mr. Stearns. Oh, that is axiomatic. We all understand that, 
but the question is, we are trying to say that--we are trying 
to understand how this could be prevented, and you are saying 
you don't know how it could have been prevented by the FDA.
    Ms. Hamburg. I think that----
    Mr. Stearns. You are not even--you haven't fired anybody. 
You haven't suspended anybody. It is not even clear that you 
have actually initiated anything, so I think we are leaving 
with the impression that thank goodness that Dr. Smith stepped 
up to the plate and did something, and we are just a little 
unsure what you are going to do. In fact, according to the 
staff, we are waiting, as Mr. Dingell said, we are waiting for 
all of this information from your agency, and we didn't even 
get assurance when you were asked by the chairman and by Mr. 
Dingell that we are going to get all this information. I am 
telling you, there is so much out there that your agency has 
not given us, in all deference to you, Madam. I mean, you have 
only been there a short time, I appreciate that. We need your 
assurance that you will provide it.
    Ms. Hamburg. We will provide the information that you have 
requested.
    Mr. Stearns. OK, my time is expired.
    Mr. Stearns. Go ahead, Ms. DeGette.
    Ms. DeGette. I am pulling myself together. I am going to 
ask some questions.
    Dr. Hamburg, I think you can agree with me that, between 
2002 and 2006, the FDA made some attempts to investigate this, 
and they were pretty inconclusive, correct, yes or no? Yes or 
no?
    Ms. Hamburg. I apologize----
    Ms. DeGette. OK, you are not going to answer that. Let's 
just keep going on. OK, now, in April of 2002, the FDA began an 
inspection of the New England Compounding Center, correct? Yes 
or no?
    Ms. Hamburg. Yes.
    Ms. DeGette. And that inspection continued throughout the 
fall and winter of 2002 and 2003, correct?
    Ms. Hamburg. Correct.
    Ms. DeGette. Now, eventually, now, you weren't there. This 
was not your--it was not your job to defend what they did. But 
in 2002, the FDA investigators concluded, after a lot of 
investigation, that they--that there were jurisdictional 
issues, is that correct, yes or no?
    Ms. Hamburg. That is correct.
    Ms. DeGette. They then turned this investigation--there 
still was some FDA involvement, but for the most part, they 
turned this investigation over to Massachusetts, yes or no?
    Ms. Hamburg. Yes.
    Ms. DeGette. And so what happened at that point was then 
the FDA did have some involvement, but it was primarily 
Massachusetts, is that right? Yes or no?
    Ms. Hamburg. That is correct.
    Ms. DeGette. Now, in the meantime, you know, I will say we 
are just trying to get answers here because we do need to 
figure out how to prevent this. And if we can't prevent this 
kind of a thing, then shame on us, because this is a company 
that had black specks floating in the vials. It had cleanliness 
that wouldn't even be accepted anywhere in the world. And we 
are all sitting here wringing our hands. So we have to figure 
out how to give you the jurisdiction to do what you need to do, 
and we have to figure out how to give Dr. Smith and all of the 
other State regulators, like Colorado, the ability to work with 
you to do that. OK?
    Ms. Hamburg. Agreed.
    Ms. DeGette. And these inconclusive answers are not helping 
us. Now, the act, Section 503 of the act has all of these 
requirements regarding the compounders, correct?
    Ms. Hamburg. Correct.
    Ms. DeGette. And what it says is, a compounded drug is 
exempt from a variety of requirements of the Federal Food, Drug 
and Cosmetic Act relating to drugs to get FDA pre-approval if 
the drug is compounded for an individual patient based on the 
unsolicited receipt of a valid prescription, correct?
    Ms. Hamburg. Correct.
    Ms. DeGette. And it says, the drug is compounded by a 
licensed compounding pharmacy, correct?
    Ms. Hamburg. Correct.
    Ms. DeGette. So what has happened over all of these years 
is these drug compounders have started these great big 
manufacturing facilities, and then they have the illusion that 
they are keeping these scripts for the individual patients, but 
they are really not doing that. Is that correct?
    Ms. Hamburg. That is correct.
    Ms. DeGette. And that is part of the problem, right?
    Ms. Hamburg. That is.
    Ms. DeGette. OK, now, just hold off. So the other thing 
that has happened then, Section 503(a) says, and this goes to 
what Mr. Griffith was saying, is Section 503(a) says that the 
FDA can take jurisdiction if these compounding pharmacies are 
exporting more than 5 percent of their drugs to other States, 
correct? It says that, right?
    Ms. Hamburg. 503(a), yes.
    Ms. DeGette. So what Mr. Griffith is saying then, is why 
doesn't the FDA just enforce that? But here is the problem, Mr. 
Griffith, and this is what Commissioner Hamburg is trying to 
say. Is the Ninth Circuit has thrown out all of Section 503, 
and it says, it doesn't even apply. And the Fifth Circuit has 
said Section 503(a) only applies to advertising, and that is 
what that map is about.
    And so what Dr. Hamburg is trying to say is, you know, we 
can point fingers and we can be upset, and everything, and we 
should be, about what happened 10 years ago, and why this 
operation wasn't shut down, but what we really need to think 
about is what are we going to do going forward to make sure 
that the jurisdiction is clarified?
    And I would bet you if we could all sit down and talk about 
it, we could agree on the same principles. We don't want the 
FDA having jurisdiction over the doctor and the little mom-and-
pop pharmacy who is trying to make the ointment for the kid. 
But if it really is a big manufacturing operation, even though 
it is a compounding pharmacy, we need to, if the law isn't 
clarified now, if there is litigation, if there is a separation 
of court decisions in the cases, we need to fix that. And that 
is our job as Congress.
    So I guess I would say, Dr. Hamburg, you know, I understand 
what you are saying, but within the--within the purview of the 
law as it is written now, the FDA needs to do everything it can 
to make sure it prevents this kind of activity. And 
furthermore, we have a job, we have a job to all of these 
victims as Congress to not try to move the lounge chairs around 
on the Titanic.
    We have a job to clarify the law if there is not clarity in 
the law, and we can easily do it. So thank you, Mr. Chairman, 
and I yield back.
    Mr. Stearns. I think we have a little time here. We could--
you and I could have a colloquy here, and Mr. Griffith, you can 
participate in this colloquy. You are an attorney, Ms. DeGette, 
and I appreciate what you are saying, but I think the 
interpretation of what you did on the Supreme Court is not 
wholly explained, as you said. I am asking staff, did the 
Supreme Court throw out the entire was it 503(a). I don't think 
they threw it out. They threw out only that portion that dealt 
with marketing. And so for you to say they threw out the whole 
thing so that the commissioner and the FDA had no 
interpretation----
    Ms. DeGette. No, no that is not what I said, Mr. Chairman.
    Mr. Stearns. Well, that is what you sort of implied, and 
the legal problem is that the Supreme Court only did a very 
small portion of that and left intact the idea that the company 
that is manufacturing still can be determined if they are a 
small pharmaceutical or they are a manufacturer, so I would 
submit----
    Ms. DeGette. Mr. Chairman, if you would like to have a 
colloquy, I will tell you what I said.
    Mr. Stearns. I think you appreciate what I said.
    Ms. DeGette. What I said was that the Fifth Circuit threw 
out the 503(a) provision only on advertising, and left the rest 
of it intact.
    Mr. Stearns. Right.
    Ms. DeGette. The Ninth Circuit threw out all of 503, and 
then the Supreme Court took cert on the Fifth Circuit--Ninth 
Circuit case, but they only talked about the advertising. So 
now it is really a big mess.
    Mr. Stearns. And I agree, because of the Fifth, and Ninth 
Circuit, and the Supreme Court. But I don't think, and this is 
what you are implying, that it creates such a position that the 
FDA had their hands tied, and they couldn't determine what is a 
manufacturing and what is a small pharmaceutical. I think you 
still have----
    Ms. DeGette. Again, you are misinterpreting what I said.
    Mr. Stearns. OK.
    Ms. DeGette. What I said is that there is a lack of clarity 
in the law and what that means is that evil-doers like this 
compounding pharmacy, don't feel like they have to listen to 
the FDA. They don't feel like they have to produce the 
documents when they are requested, and they sue whenever there 
is anything that happens. And that is the problem, is it ties 
the FDA's hands when they are trying to take enforcement 
actions against these folks even if they want to.
    Mr. Stearns. OK, you are welcome to step in here, but I 
think I would----
    Mr. Waxman. Point of order, Mr. Chairman. Whose time is it 
now?
    Mr. Stearns. Right now, it is hers. I gave her the time, 
and she yielded back, and I asked her if I could have a 
colloquy with her, which she agreed to, and you are welcome to 
join in. I think this is a legal interpretation, which I think 
you are welcome to join in.
    Mr. Waxman. Mr. Chairman, I wouldn't want to interrupt your 
discussion, but we do have members on both sides of the aisle 
waiting for their opportunity to get to the round of questions.
    Mr. Stearns. Oh, sure, well, you weren't here at the time, 
and I would be glad to recognize you.
    Mr. Waxman. It goes to your side next.
    Mr. Stearns. Oh, that is right. You are right. I am going 
to take 15 seconds and just say the purview of the chairman is 
I think what Ms. DeGette is talking about between the Fifth and 
the Ninth Circuit Court, and the Supreme Court----
    Ms. DeGette. Don't interpret what I am saying.
    Mr. Stearns. I know, but I am the chairman, and what I 
think is that there was still left the integrity of the law so 
that the FDA could determine who is manufacturing and who they 
have jurisdiction over.
    Mr. Waxman. Regular order, Mr. Chairman.
    Mr. Stearns. With that, I will recognize the gentlelady 
from Tennessee.
    Mrs. Blackburn. Thank you, Mr. Chairman, and I have just a 
couple of questions.
    You all have stayed with us, and I do appreciate this.
    A point of clarification, Dr. Hamburg. You mentioned 
earlier there are 7,500 advanced compounding pharmacists and 
3,000 sterile.
    Ms. Hamburg. That is information that was given to us by 
the International Association of Compounding Pharmacies.
    Mrs. Blackburn. OK, well, that is what I want to know if 
that was----
    Ms. Hamburg. We don't know the numbers because they are not 
required to actually report to us, so we don't know numbers 
from our own assessments.
    Mrs. Blackburn. OK, but you can source that for us? Would 
you provide that sourcing so that we have that?
    Ms. Hamburg. OK, certainly.
    Mrs. Blackburn. OK, thank you, I appreciate that. Let me, I 
want to go back to this issue that you all had because you had 
the Colorado complaint against NECC in May of 2011, is that 
correct?
    Ms. Hamburg. That is correct.
    Mrs. Blackburn. OK. And that complaint came into you well 
in advance to any of these contaminated lots being shipped, is 
that also correct?
    Ms. Hamburg. Well, as I understand it, it was a request for 
information from us about whether they were registered as a 
manufacturer, a drug manufacturer, and they--NECC is listed as 
a compounder.
    Mrs. Blackburn. Well, I think Colorado notified the same 
FDA compliance officers who had inspected NECC in the past, is 
that correct?
    Ms. Hamburg. I believe.
    Mrs. Blackburn. And that these inspectors were aware of 
NECC's past violations, isn't that correct?
    Ms. Hamburg. I believe that the email from Colorado was 
shared within the FDA because of the history with NECC.
    Mrs. Blackburn. OK, and then, in that email, did they not 
say that NECC was again shipping volumes of drugs without a 
prescription?
    Ms. Hamburg. What they indicated to us was that they were 
concerned that NECC was operating in violation of Colorado 
State Board of Pharmacy licensure and registration laws, and 
they included attachments----
    Mrs. Blackburn. OK. Doctor.
    Ms. Hamburg [continuing]. About the volume of product that 
was being shipped.
    Mrs. Blackburn. But it was clear that it was a repeat 
violation, isn't that correct?
    Ms. Hamburg. What was clear was there were not specific 
safety and quality concerns, but they were noting that there 
were not valid prescriptions for the materials that were being 
sent to Colorado.
    Mrs. Blackburn. OK, let me ask you this. Did the FDA do 
anything at all with that complaint?
    Ms. Hamburg. Well, we suggested that they follow up with 
the Massachusetts Board of Pharmacy because----
    Mrs. Blackburn. You suggested? You suggested; you didn't 
require. Did you even pick up the telephone and call the 
Massachusetts Board of Pharmacy and say, ``We think we have a 
repeat offender''?
    Ms. Hamburg. I understand, you know, what you are getting 
at there, but it----
    Mrs. Blackburn. Yes or no. Did you pick up the phone and 
call? Did anybody pick up the phone and call?
    Ms. Hamburg. Email was being used, but it was communicated 
through the Colorado Board of Pharmacy.
    Mrs. Blackburn. Would you like to supply all of those 
emails to us for the record?
    Ms. Hamburg. I believe you have them.
    Mrs. Blackburn. OK, we have got all of those in total. When 
did you personally become aware of the situation? I mean, at 
what point in the process did you individually, not your staff, 
but you? When did you hear of it.
    Ms. Hamburg. When the first cluster of meningitis cases and 
the possible link to NECC was identified. It was in late 
September.
    Mrs. Blackburn. OK, Dr. Smith, let me come to you with my 
last minute. Did the FDA ever contact you?
    Ms. Smith. Are you--just so I can understand, do you mean 
in the past or around this current outbreak?
    Mrs. Blackburn. No, let's go back to the Colorado 
complaint. Did they ever contact you? Did you ever--did you 
ever get a phone call or an email from anybody that said, we 
think we have a repeat offender out here?
    Ms. Smith. Well, I can't speak to the phone calls, but 
review of the emails does not suggest that we got any 
information then.
    Mrs. Blackburn. So they knew they had a repeat offender, 
but they did not call you.
    With the boards of pharmacy, like with Colorado, back to 
you, is there any direct contact there? You know, so many of 
our State boards, who do a great job of regulating areas, 
contact and work with other State boards who have like 
supervision in their States.
    Ms. Smith. Well, we did receive information from Colorado 
about the action, but it wasn't until July of 2012, and we 
weren't, or I wasn't aware of that until we discovered that in 
the process of producing the documents for this committee.
    Mrs. Blackburn. OK, and let me ask you this: Personnel 
actions in response to this, the NECC, have you taken any 
actions there?
    Ms. Smith. Yes, the executive director at the time has been 
let go from the department, and the board counsel has been put 
on administrative leave as was the division director for that 
area.
    Mrs. Blackburn. And are you reviewing your processes and 
best practices?
    Ms. Smith. Regarding personnel actions?
    Mrs. Blackburn. Yes.
    Ms. Smith. Yes, as we reviewed the information, again, that 
we presented for this committee, we have identified lapses in 
judgment, which have resulted in these personnel actions.
    Mrs. Blackburn. Thank you. I yield back.
    Mr. Stearns. The gentleman from California, Mr. Waxman, is 
recognized for 5 minutes.
    Mr. Waxman. Thank you, Mr. Chairman.
    I find this hearing amazing.
    Mr. Stearns. Amazing.
    Mr. Waxman. Because what we need to do is to work together 
to solve a problem and make sure it will never happen again. 
Instead what I hear from my Republican colleagues is they want 
to prosecute the director of the Food and Drug Administration. 
Did she know this? What action did she take?
    It sounds like Massachusetts has a lot to be apologetic 
about. Isn't that a fair statement, Dr. Smith.
    Ms. Smith. Yes, you are right.
    Mr. Waxman. And the question is, did FDA fail to do things 
they should have done? Well, it sounds like you could have done 
more. The FDA as an institution could have done more. The first 
time they wrote a letter was in 2006, saying that this thing 
seemed to be--this company seemed to be out of control. And 
then they didn't do anything after that.
    Now, I have a feeling, Dr. Hamburg, you are being picked on 
because you are part of the Obama administration, and 
Republicans have been picking on Obama for 4 years, and usually 
their mantra goes, job-destroying regulation, let industry 
police itself, we don't want government involvement.
    Now, they are saying, we want more government involvement, 
and I think they are right. We want appropriate government 
involvement to stop these things from happening.
    So you would think that our obligation would be to figure 
out, do you have the authority? I respect the chairman greatly, 
but I have never understood him to be a great legal scholar. It 
seems to me there is some ambiguity. If there is an ambiguity 
it is our job to clear it up. You think there is an ambiguity 
because the law that we drafted in 1997 said one thing and the 
court came in and said something else. You don't know whether 
you can act, whether you can't act. If we want to make sure you 
act in the future, other than just beat you up for not acting, 
we ought to make sure that you have all of the authority 
appropriate to act. The courts have thrown out part of that 
1997 law. The courts are themselves divided on whether Section 
503(a) continues to have any legal force. In the Western 
States, 503(a) is not effective; while in Texas, Louisiana, and 
Mississippi, it is. And as the map is put together by the 
compounding industry itself shows, there is a very large gray 
area in-between.
    So why are we looking for anybody to blame other than the 
company and making sure that the regulators have all of the 
power that they need. That involves, my colleagues, regulatory 
power to act. It also involves, I tell you regulators, to do 
your action, to take action to stop these bad actors from doing 
what they want.
    And I wasn't in the room, but I understand the chairman of 
the Oversight Committee said, they are not going to do any 
legislation. Well, I would rather we do it now before he 
leaves. Because he is so involved and steeped in this whole 
question, he should want to work with us to solve this problem. 
It doesn't sound like that difficult a problem. We need to say 
the FDA has the authority to do this, to do this, to do that.
    Commissioner Hamburg, can I ask you for a commitment to 
make your staff available to us this week if we started a 
process to----
    Ms. Hamburg. Absolutely, tomorrow. We are so eager to work 
with you because we feel there are significant gaps in our 
authorities that limit and undermine our ability to do all that 
we want to do to protect the health and safety of the American 
people. You know, I think that the fact that we have a 
situation like that map reveals, suggests that we don't have a 
comprehensive, integrated legal framework for action, and we 
think that we can work with you to identify critical areas from 
registration, so we know who is out there, and what they are 
doing, to developing Federal standards that should be adhered 
to to ensure safe and high-quality products, to the ability to 
do full inspections.
    Mr. Waxman. I don't want to get you off the hook 
completely. I think you need the law to be clarified, but if I 
were sitting in your shoes--that is a mixed metaphor--if I were 
sitting in your seat and I was the head of the FDA and I heard 
that Colorado was concerned about this situation, and you heard 
other reports, I would have assumed I had jurisdiction. I would 
have assumed the jurisdiction. I would have acted on it.
    And I have to say to the State, you know, people want to 
make partisan comments, and I think what some of what is going 
on is a little partisan. When FDA first sent the letter, the 
chairman said when you sent a letter, was the FDA under the 
Bush administration? When the State of Massachusetts had a weak 
consent agreement, it was under Governor Romney's 
administration. You are now here under Governor Deval Patrick 
and here under President Obama. Let's put partisanship aside. 
Let's make sure you have the authority and the resources to do 
the job. We want you to do the job because we ought to be 
mindful of the comments that Mrs. Lovelace made and all of the 
other people who are waiting to see if they are going to die 
from this contaminated drug.
    We don't want excuses. We don't want to leave this law 
ambiguous because you are sued if you act. And if you act, 
assuming you have authority when you don't, you are usually 
called before committees to say, how could you act as if you 
have authority when Congress didn't give it to you?
    I think we ought to put our partisanship aside. The 
election is over. Figure out a clear law for the Federal 
Government to be able to act because, because with all due 
respect, this is not a State issue if a drug is being shipped 
around in the country. It is an interstate issue.
    Thank you, Mr. Chairman.
    Mr. Stearns. Sure, and I will be the first to recognize-- 
to recommend you as you as chairman of the FDA.
    Ms. DeGette. Can we finish this hearing, please?
    Ms. Hamburg. Might not want that job.
    Mr. Stearns. All right, Dr. Burgess is recognized.
    Mr. Burgess. Thank you, Mr. Chairman.
    And something that is very important, I don't want it to 
get lost in the translation. Representative Blackburn asked 
about emails between the FDA regional office, and the 
Massachusetts Board of Pharmacy.
    And Mr. Chairman, may I suggest that those emails are a 
critical part of our investigation and that we must receive 
those, even if it is necessary to exercise subpoena authority. 
We need access to that critical part of the----
    Mr. Stearns. If the gentleman will yield for one second. We 
have tried. We have got no emails from the FDA. The crux of 
this hearing is to get to the bottom of what happened. We can't 
get to the bottom if we don't have the information. So you are 
exactly right. The FDA has got to cooperate and give us the 
emails, because we have gotten zero.
    Mr. Burgess. Well, and of course, the FDA has a lot of 
material, and the access to the opinion of your experts would 
be important to us in this investigation. So the intransigence 
that Chairman Upton referenced in his opening statement is 
something that really must be overcome. Now, I am of the 
opinion that you had all of the authority that you needed, and 
yes, it was a previous commissioner, and it was a previous 
administration. So, once again, I would also ask that if there 
is a memo from a general counsel at FDA to the then 
commissioner about, you don't have the authority to do what you 
said you were going to do in this enforcement letter, I think 
the committee really should see that as well. And again, I 
think we should exercise every power that we have in order to 
get that. And the reason it is important is if new legislation 
is indeed passed and passed hurriedly, as has been recommended, 
before the end of the year, and yet you are not going to act on 
that authority, then we are going to be right back here in the 
same soup with the same problem at some point in the future, 
and it may be a different commissioner from the FDA and they 
will say, well, there was an ambiguity. Look, there is no 
ambiguity. You have got a criminal investigation going on 
against NECC, is that not correct?
    Ms. Hamburg. There is a criminal investigation, yes.
    Mr. Burgess. So where is the ambiguity? If you have a 
criminal investigation, if you had all of the guys in FDA 
jackets seizing computers out of the compounder, where is the 
ambiguity?
    Ms. Hamburg. First, let me say, we are working to get you 
the emails that you want. We have been trying to develop 
documents and get them to you as swiftly as we can in light of 
everything that is going on. You know, I know it is not the 
answer that you want to hear, but I do think that there is 
clearly ambiguity and a lack of----
    Mr. Burgess. A criminal investigation, guys in FDA jackets 
seized the computers, did it on TV so everybody can see. That 
doesn't look ambiguous----
    Ms. Hamburg. No, but--the need for legislation. You know, I 
want to do everything to work with you and get you the 
information that you need, but I think we also do need to look 
forward and look at where are the gaps in authority.
    I cannot speak to what was going on in the FDA during that 
period because, as has been noted, I wasn't there.
    As I understand it, there were very intense discussions and 
conflicts about what were our authorities, what--there was 
ongoing litigation; what basis would we use for different 
regulatory actions that might be taken.
    Mr. Burgess. So help us here. If we are going to craft 
legislation rapidly before the end of the year, as has been 
suggested several times on the other side of the dais, how do 
we keep from making the same mistake again? Look, do you have 
the authority to conduct an investigation as to whether or not 
you have jurisdiction to conduct an investigation because that 
is what I have been hearing all day?
    Ms. Hamburg. We have authorities that have been 
consistently contested, have resulted in split court decisions, 
in a patchwork of regulatory legal oversight, and you know, 
that is part of what I think we can and should address 
together.
    Mr. Burgess. Yes. Look, people are dead. Doctors have 
administered medication that they thought was safe, and their 
patients have suffered. They have got to live with those 
consequences. The case we heard about today where the doctors 
in the intensive care unit at Vanderbilt Hospital didn't have a 
clue as to what was really the culprit in that gentlemen's 
illness. There is a lot of stuff here that, if there is a 
problem with the existing statute, it needs to be corrected. 
Then you owe us the ability to look at those internal documents 
and see what the discussion----
    Ms. Hamburg. And we will get that to you.
    Mr. Burgess. Well, it has been said time again, we have to 
do this before the end of the year, give us the stuff. Mr. 
Chairman, I am going to ask that we subpoena the stuff that we 
need, and do that forthwith. I mean, yes, I know it is holiday 
season and nobody wants to be working on this stuff, but we 
have got to do it. And if we rapidly produce legislation so 
that we can just say we have done something before the end of 
the year so we can all feel good about ourselves, again, we are 
going to be back here in the same mess, 2 years, 3 years, 4 
years fill in the blank. If all you need for the cloak of 
invisibility is to say you have a compounding pharmacist, I 
mean, what is to stop Pfizer tomorrow from saying, oh, I am a 
compounding pharmacist. All of this stuff goes out the door and 
you can't stop me. You can't touch me because the Fifth Circuit 
or the Ninth Circuit or someone said, you can't touch me. That 
is nonsense. No one believes that that is the way it should be, 
and surely, you don't either.
    Ms. Hamburg. I do not. And that is why I really do feel 
this is an extraordinary opportunity for us to fix some of 
those problems that have really been present for now at least 
15 years and have tragically resulted in incidents involving 
deaths, loss of vision, other injuries and harm from drugs that 
the patients thought would help them, not harm them. So I think 
we can strengthen----
    Mr. Burgess. Look, you owe us the information you have.
    Ms. Hamburg. And we will get that to you.
    Mr. Burgess. You have emails. You have experts under your 
control. If this is something that has been discussed 
internally, and there has been a conflict internally, let us be 
privy of that information so that when we try to craft the 
legislative fix, it is not an imperfect product. And you have 
got all of the authority you need today to shut this place 
down, lock them up, and send them away for however long that 
anyone would care to think, for whatever reason, it didn't 
happen in 2002, 2004, 2006, 2008.
    Mr. Stearns. The gentleman's time has expired.
    Mr. Burgess. I yield back.
    Mr. Stearns. Mr. Dingell, before I recognize Mr. Dingell, 
Dr. Hamburg, we have gotten thousands and thousands of emails 
from Dr. Smith's agency, so the fact that you have got none--
she has less resources than you do, yet they complied and have 
given us all of the information. So I just really urge you and 
your staff to comply.
    Ms. Hamburg. We will get that to you.
    Mr. Stearns. All right, Mr. Dingell is recognized for 5 
minutes.
    Mr. Dingell. Mr. Chairman, thank you.
    Dr. Smith, and commissioner, it is possible for the two of 
you to execute Memorandums of Understanding defining your 
respective jurisdiction, is it not?
    Ms. Hamburg. Yes.
    Mr. Dingell. Is there any reason why you could not or would 
not begin to devote your attention to achieving such a 
Memorandum of Understanding so that you could define where the 
authorities of Food and Drug lie, and the authorities of the 
agency in the State of Massachusetts lie? Are you willing to 
undertake that, ladies?
    Ms. Smith. Well, I certainly think that there are multiple 
opportunities for us to do better in terms of communication and 
that sort of thing as a beginning.
    Mr. Dingell. We are going to try, I think you can sense 
from the committee and its questions to proceed towards a 
legislative solution, and it may very well be that we have to 
do so, and I think we are determined to do so.
    What I am hoping is that while we are doing that, that you 
will commence doing what you have the capacity to doing, i.e. A 
Memorandum of Understanding, where the two of you define your 
respective responsibilities so that we can get ahead of this 
curve. And if we cannot complete our business by year end 
because of the Senate or other things, that we are able, 
therefore, because of your labors, to commence the process of 
moving along on a parallel track. Are you willing to do that?
    Ms. Hamburg. We are certainly willing to do that, and we 
are pulling together all of the 50 States in order to really 
begin----
    Mr. Dingell. Well, I don't want to put out difficulty for 
you, but I want to look at how to resolve the problem.
    Ms. Hamburg. But I just have to underscore that it still 
won't address what the courts say, different regulatory 
requirements.
    Mr. Dingell. Doctor, the clock runs, and it is most 
uncharitable.
    I will look for you to give me an answer on what you can do 
to get a Memorandum of Understanding done between your two 
agencies and/or other agencies.
    Now, it is possible to define a compounder as a person who 
makes certain amounts and to define a manufacturer as a person 
who makes certain amounts of pharmaceuticals, is it not? Yes or 
no?
    Ms. Hamburg. You could decide to put that in legislation. 
Currently, that does not exist in the legislation.
    Mr. Dingell. You are telling me you don't have the 
authority to do that? You do or don't have that authority?
    Ms. Hamburg. Volume in and of itself is not dispositive. It 
could be put into legislation as a statutory factor in our 
determination.
    Mr. Dingell. It appears that the New England Compounding 
Center and other like-hearted rascals have engaged in the 
practice of figuring themselves a fine loophole in which, 
through lobbying and other efforts, they have been able to 
assure that they are able to engage in practices that impose 
substantial dangers on the American people.
    Now, having said that, I would like to have you tell me one 
more thing here, if you please, Doctor.
    You have one of the required treatments for this particular 
fungicidal meningitis that takes place is to have availability 
of a substance called oral voriconazole, which is a therapy 
used in treating spinal meningitis. There is a great concern on 
the part of a hospital in my district St. Joseph Mercy in Ann 
Arbor, and they are troubled that there is going to be a 
shortage of this particular pharmaceutical available to them to 
provide the necessary treatments for their patients who have 
been hurt by this particular--the particular injectable that we 
are talking about today.
    What is there that we can do to assure that there is an 
adequate, current, and future supply chain for oral 
voriconazole?
    Ms. Hamburg. Well, voriconazole has been used in the 
treatment intravenously, and from the very beginning, we have 
been looking at the possibility of shortages. When last I 
discussed that with----
    Mr. Dingell. What are we going to do about that?
    Ms. Hamburg [continuing]. They did not feel it was in 
shortage. I have not heard anything further. I will get back to 
you if there are concerns, but I do not believe that it is at 
risk for shortage at the present time.
    Mr. Dingell. This is a matter of urgent concern, and I 
would suspect that my people at St. Joe's are concerned that 
you all have hospitals and practitioners elsewhere in the 
country who all have the same concern. So I would appreciate if 
you can look----
    Ms. Hamburg. Yes, we will be examining that.
    Mr. Dingell [continuing]. Into that.
    Mr. Chairman, I thank you for your courtesy.
    Mr. Stearns. The gentleman from Virginia is recognized for 
5 minutes, Mr. Griffith.
    Mr. Griffith. Mr. Chairman, this is probably a first for me 
in the time that I have served on this committee, but I agree 
with Mr. Waxman when he said that he would have made the 
assumption, particularly in those areas that are gray, that you 
had the authority. And so I just point that out to you.
    Now, maybe it is because I was a criminal defense attorney 
in my prior life, you know, the threats that somebody might sue 
me just aren't something that would stop me from trying to do 
my job. And if I thought I was right, I would have gone 
forward. And that is why we want to see the emails, and we want 
to see the memorandums. You have heard all of these questions, 
and I thought Ms. DeGette did a nice summation. And I wish you 
would have been as clear in your answers as she was in trying 
to interpret your position.
    But having been a criminal defense attorney and having 
heard you all day say that, you know, you didn't have authority 
or your authority was vague, or you needed clarification of 
authority, I have to ask the question, what is your legal basis 
for the FDA going in and doing a criminal investigation in this 
case?
    Ms. Hamburg. Well, of course, that is being done with the 
Department of Justice, but the Food, Drug, and Cosmetics Act, 
obviously, is the basis for so much of our regulatory actions, 
but the problem here is that a component of 503(a) has been 
questioned in the courts, and it applies in some areas and it 
doesn't apply in other areas. And we have, around compounding 
pharmacies, we have guidance that we have put out that would be 
applying in some areas, but that doesn't have the force of law. 
So, you know, it is a challenging arena for regulatory----
    Mr. Griffith. Well, here is the problem, and I fear that in 
your comments today, you may have made the argument for the 
defense that they are going to escape criminal sanctions 
because you have said the law is ambiguous and that you don't 
have the authority to go forward. And I think that is a mistake 
because, look, you know, I think, as I said before, they are a 
manufacturer, particularly when we have 1,415 patients in my 
area alone. I think they are a manufacturer. And just because 
they call themselves a compounder doesn't make it so. I could 
call myself the Duke of Earl and claim diplomatic immunity. 
That does not make it so. In a trier of fact, if you all had 
been aggressive on this, I believe a trier of fact would have 
found they were weren't a compounder a long time ago, which is 
why, as you move forward, you didn't answer the question 
earlier, so I am assuming that you don't routinely contact 
medical professionals and ask them where they are getting their 
drugs from so that you couldn't identify. I think that is what 
you should have been doing, but hindsight is 20/20, as we all 
know.
    But I think you ought to be looking at doing something like 
that in the future so that you can protect the American public. 
I think, like Mr. Waxman said, you should have assumed you had 
the authority when you had a bad actor. And I think as you go 
forward, you have to look at that. And Dr. Smith, I would hope 
that you all would look--I believe they may have undermined 
their criminal case today. So since they said it was a State's 
responsibility, perhaps there is a State law that you could 
look into and ask your attorney generals to look and see if 
there is any criminal prosecution that could be brought under 
State law, because if FDA doesn't have the authority to deal 
with them from a regulatory standpoint, I am not sure they have 
the authority to go in and seize the computers and do what they 
are doing.
    That being said, I would now yield my time to the 
gentlewoman, Congresswoman Blackburn.
    Mrs. Blackburn. Thank you. I appreciate that, and Dr. 
Hamburg, I want to go back to this issue with the emails that 
pertain to NECC. The first violation came up in 2002, and 
please understand that it was unclear in your answer to me 
about the emails. You seemed to indicate you thought we had 
your emails. We do not. So let me be very clear: We want to see 
this entire file going back to 2002. We want all of those 
emails, and we want the conversation that took place via email 
with the Massachusetts Board of Pharmacy.
    I have 81 Tennesseeans and 13 deaths. We are very concerned 
about this. We are concerned about everyone that has been 
adversely impacted. Our sympathies and thoughts are with them, 
and we are incredibly concerned about the ineffectiveness of 
the bureaucracy, and it doesn't matter which administration. It 
is the lack of attention by this agency to a situation that has 
gotten out of hand.
    So just to be certain that you understand what we are 
asking, all of the emails, we are not in possession of this. We 
are--and we have asked for this. So we do ask that you comply 
quickly, so that we can see the full extent to your 
participation and the manner in which you all communicated 
with, responded both on an intra-agency, and then also with the 
Massachusetts Board of Pharmacy.
    And with that, I will yield back the balance of my time.
    Mr. Stearns. The gentlelady's time--gives up her time, and 
the gentleman from Massachusetts is recognized for 5 minutes.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    Dr. Hamburg, isn't it true that the legal definition of 
drug manufacturer in Section 510 of the Food, Drug, and 
Cosmetics Act exempts pharmacies?
    Ms. Hamburg. You know, I am not a lawyer, but my 
understanding is yes.
    Mr. Markey. Yes. So that creates a problem right up front 
from a legal perspective.
    Ms. Hamburg. Yes.
    Mr. Markey. That clear statement that exempts pharmacies 
from FDA jurisdiction, and when it comes to drug manufacturers, 
that in the actual definition itself, it kind of talks about 
what would be equivalent of Merck, Bayer, or Pfizer as a 
manufacturer, and then it explicitly says pharmacies aren't 
covered, you know, in that definition. So that is just loaded 
with potential for lawsuits, you know, for questions that can 
be raised about your authority, and do you need that clarified 
so that you absolutely have the ability to regulate compounding 
pharmacies in a way that protects the public health and safety?
    Ms. Hamburg. I think that 510 exempts from registration, 
not any kind of jurisdiction, but I think the problem is that--
I am not saying we have no authority. I am saying that our 
authority over drug manufacturers is very different, and it 
requires a set of clear actions on the part of the 
manufacturers and the part of FDA.
    In this area, it is simply much more murky, and it is 
contested in the courts, and we have a split court decision. We 
have different legal frameworks that govern different States, 
yet we have an industry that operates across State boundaries.
    We don't have the kind of authorities that we need, and we 
don't have the kind of clarity of the legislation that we need 
as well, you know. I am deeply troubled by what has happened in 
this case and with NECC, and if there were actions that could 
have been taken at an earlier time to prevent it, I would wish 
that that were so.
    But you know, what I am speaking to now is, we have this 
opportunity. It is a clarion call to action, I think. And if we 
don't want to see that kind of event repeated, and it is not an 
event that has occurred in isolation, you know. There have been 
events in so many Members' districts in the past over a period 
of many years, that I think we have an obligation to work 
together to create new legislation that defines this in a way 
that is clear and understood and that gives FDA new 
authorities.
    Mr. Griffith mentioned, you know, why aren't we writing to 
compounders, or why aren't you writing to patients telling them 
that they might be getting drugs from compounders? Well, we 
don't even know the universe of compounders and what they are 
making. So we clearly need additional authorities in order to 
achieve some of this goals that we have been talking about.
    Mr. Markey. And, Doctor, that is why I listed the 
individual component parts of my legislation, just so it could 
be clear that you would welcome that authority. And then we 
could ensure that you can be the true cop on the beat.
    But I do believe that it is troublesome that in the legal 
definition of ``drug manufacturer,'' the legal definition in 
the FDA statute, it actually exempts pharmacies in that 
definition.
    So the whole area is just rife with ambiguity. And in that 
atmosphere of ambiguity, we have wound up with a mess on our 
hands. And we just have to make sure that that never happens 
again.
    Mr. Chairman, I thank you so much.
    Mr. Stearns. Thank you.
    And I would say to the panel, we have completed our 
questions here. And, as the chairman, I have usually the 
ability to say the last few words. And in defense of Mr. 
Markey, who had made the case, in his words, as murky, I go 
back to what Mr. Waxman said, that if he was chairman of the 
FDA, he would not have been cautious; he would have been siding 
on safety and gone through and exercised, regardless of what 
the situation. I agree with him, and that is why I think he 
probably should consider being the commission chairman.
    And, also, I would say to you, if Pfizer or Merck or any 
large pharmaceutical company suddenly call themselves a 
compounding company, you are implying that you wouldn't have 
jurisdiction over them, when we know that is not true. In fact, 
you know, when you look historically, you see lots of criminals 
that are being indicted; they make the case that, ``I was doing 
work for the FBI under cover.'' And, lo and behold, that was 
just a front so that they could defend themselves when, 
actually, they were committing fraud and criminal activity.
    And, lastly, I would just conclude, Mr. Griffith and Dr. 
Burgess both mentioned the FDA appears to have the legal 
authority to walk in and take computers with their jackets, we 
have seen on television. And, certainly, if you had the ability 
to go in and prosecute and take the computers from NECC, then 
surely you had the jurisdiction to shut them down, because you 
had the jurisdiction to go in and take their equipment.
    And, certainly, I think many of us in this committee are 
disappointed that you are not providing the emails and 
information we need so we can get to the bottom of this. And 
that was the intention of this whole hearing, is to see what 
really happened.
    So, with that, the subcommittee is adjourned.
    [Whereupon, at 2:00 p.m., the subcommittee was adjourned.]
    [Material submitted for inclusion in the record follows:]


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