[Senate Hearing 113-]
[From the U.S. Government Publishing Office]



 
   AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND 
          RELATED AGENCIES APPROPRIATIONS FOR FISCAL YEAR 2014

                              ----------                              


                        THURSDAY, APRIL 18, 2013

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 10:32 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Mark L. Pryor (chairman) 
presiding.
    Present: Senators Pryor, Tester, Udall, Blunt, and Cochran.

                DEPARTMENT OF HEALTH AND HUMAN SERVICES

                      Food and Drug Administration

STATEMENT OF HON. DR. MARGARET A. HAMBURG, COMMISSIONER
ACCOMPANIED BY:
        NORRIS COCHRAN, DEPUTY ASSISTANT SECRETARY FOR BUDGET, 
            DEPARTMENT OF HEALTH AND HUMAN SERVICES
        JAMES TYLER, CHIEF FINANCIAL OFFICER, FOOD AND DRUG 
            ADMINISTRATION


               opening statement of senator mark l. pryor


    Senator Pryor. We will go ahead and call the meeting to 
order.
    Let me call it to order and say that this is my first 
hearing as chairman of this subcommittee. So let me start by 
thanking my ranking member, Senator Blunt, who has already 
proven to be a very good and effective partner and wise counsel 
in many, many ways. And I look forward to working with Senator 
Blunt and with everybody on the subcommittee staff and the full 
committee, but I really value our working relationship.
    Roy, thank you for all that you have already done.
    I would also like to thank Commissioner Hamburg for being 
here and joining us today. I appreciate the working 
relationship that we have developed over the last few years, 
and I look forward to continuing that work with you. And I know 
that you are very serious about working with the subcommittee 
and the full committee on a full range of issues. So we want to 
thank you for that.
    I also want to take a minute to recognize the history and 
significance of what we are doing here today. The first 
appropriations bill was reported out of the Second Congress in 
1791. A lot has changed since then.
    To illustrate one example of how times have changed, I have 
a copy of that legislation in my office. And the entire bill is 
4 pages. Can you believe that? Four pages. Right now, you 
couldn't even get the table of contents on 4 pages on an 
appropriation bill.
    But nonetheless, one of the things that hasn't changed is 
our responsibilities to carry out the appropriations of this 
country, just like we are mandated in our Constitution. The 
function of this committee is actually mandated by the 
Constitution. I think that is very significant, and it is a 
responsibility that I and I know all the members of the 
subcommittee take very seriously.
    So what I would like to do is get down to business today, 
and that is fiscal year 2014 Food and Drug Administration (FDA) 
budget. The President's overall funding proposal for FDA is 
probably one of the most robust requests included in his 
budget. This is important because the responsibilities of the 
FDA are so vast, regulating consumer products worth 20 cents of 
every $1 spent.
    In Arkansas alone, there is over 1,300 facilities regulated 
by the FDA, as well as the National Center for Toxicological 
Research, which is a unique and important center within the 
agency that employs over 500 people in our State. And it is 
really some of the best and the brightest folks in the State.
    The total request for FDA is nearly $4.7 billion, which 
includes the budget authority that this subcommittee controls, 
to establish user fees, and some user fees FDA is proposing. 
Within that $4.7 billion, the budget request includes $2.558 
billion in budget authority. This is an increase of nearly $48 
million over the funding level provided last year without 
factoring in sequester.
    As we all know, this is a very complicated budget year, and 
we only finished our fiscal year 2013 appropriations bills last 
month. That means the FDA budget for fiscal year 2014 was 
written before you knew what you were getting in fiscal year 
2013.
    Because of this, it appears that you have asked for many of 
the same things this year that we ultimately were able to 
provide in last year's budget. We understand that, and we 
understand that we are going to have to work through that. But 
that includes funding for increased inspections in China, 
medical countermeasure activities, and funds to complete a lab 
at your headquarters.
    So it is very important that we all do work together in the 
coming weeks to ensure that the funds we provide to fiscal year 
2014 reflect the most up-to-date information and make sure the 
taxpayer dollars we are investing are used for the highest 
priority needs at FDA. We certainly don't want to pay for the 
same things twice, and we look forward to working with you 
about these issues.
    In addition, I would also like to discuss the impact that 
the sequester is having on the agency, including your user fee 
program, and I am interested to hear from you regarding the 
status of the new food safety user fees you are proposing.
    So we have a lot to talk about, but what I would like to do 
first is turn it over to Senator Blunt for his opening 
statement.
    Senator Blunt.


                     STATEMENT OF SENATOR ROY BLUNT


    Senator Blunt. Well, thank you, Chairman Pryor.
    I look forward to working with you on this subcommittee. We 
are already able to work together and get some things done on 
the continuing resolution that allowed us to finish the 
business that Chairman Kohl and I started last year, and on 
this and other areas, you and I have been able to work closely 
together. I look forward to your leadership on the subcommittee 
and to working with you.
    I want to thank our witnesses for being here today. 
Certainly, as we look at FDA and the imprint it has on the 
country and on families, it is a significant one. The FDA 
budget request for direct appropriations represents an increase 
of almost $48 million above the fiscal year 2013 enacted level 
and an increase of $174 million above the current operating 
level because of the sequestration order once it is taken into 
consideration.
    As we begin, Mr. Chairman, to formally review the 
administration's budget request, we have to be mindful that our 
fiscal house is not in order. When we held our hearing on this 
budget 1 year ago, the national debt was at $15 trillion. 
Today, it is almost at $17 trillion.
    Americans are concerned about this, and they should be. And 
I think the appropriations process, along with the Budget 
Control Act, is going to begin to reflect those concerns this 
year, as it may not have in previous years.
    Commissioner Hamburg, the agency you head has authority 
over approximately, I am told, 20 cents of every $1 spent in 
America. Americans expect that the food they eat, the drugs 
they take will be safe and effective. Similarly, your private 
sector partners expect transparency and certainty from the FDA.
    The FDA's reach is vast. The agency has authority over more 
than 300,000 foreign establishments, 185,000 domestic 
establishments, ranging from food processing plants to 
facilities that manufacture lifesaving medications. Almost 
2,800 of those facilities are in Missouri, and the others, of 
course, are all over the world.
    As FDA is implementing new requirements created by the Food 
Safety Modernization Act and the menu labeling legislation, the 
agency needs to be mindful that burdensome regulations and 
requirements can stifle innovation and lead to unnecessary 
expenses that limit the ability to create jobs. There is no 
doubt that your job is complicated, has many constituencies, 
and it is an agency that has to be careful to avoid the 
trappings of one-size-fits-all requirements because we all know 
that one size almost never fits anybody, let alone fitting 
everybody.
    Small businesses suffer under the one-size-fits-all 
practice, and too frequently, they have limited capital that 
doesn't allow them to respond to lots of new requirements. For 
example, when implementing menu labeling requirements, FDA 
needs to ensure regulations do not overburden businesses while 
still improving and providing customers with appropriate 
information so they can make decisions.
    In addition, FDA is currently receiving comments on two 
proposed rules required by the Food Safety Modernization Act. 
One of these rules, the produce safety rule, is estimated by 
the agency to cost over $460 million annually, which would be 
on the average of somewhere between $5,000 to $30,000 per farm, 
depending on the size of that operation.
    FDA readily admits the final rules resulting from the 
proposed rule will have a significant economic impact on a 
substantial number of small entities. Recent reports indicate 
that some farmers find the requirements impractical and that 
the agency misses the mark by focusing on products that have 
historically not been the cause of food safety outbreaks. In 
addition, some farmers report that some of the proposed 
requirements may simply price them out of the market, by making 
it impossible for them to compete with imports.
    As you are dealing with the final rules, these concerns 
should be seriously considered. Our economic recovery is 
fragile. 11.7 million Americans remain out of work. The labor 
force is at its lowest participation rate since the 1970s, and 
we need to be sure that we are not doing things that needlessly 
make that problem worse.
    Mr. Chairman, I look forward to the testimony. I am also 
pleased that joining us today we have the former chairman and 
the former ranking member of both this subcommittee and the 
full committee, and he continues to be very interested and 
involved in the work that this subcommittee does, and we are 
glad to have him join us today, I know.
    Thank you, Mr. Chairman.
    Senator Pryor. Thank you.
    Senator Cochran, my understanding you would like to put 
your statement into the record?


                   STATEMENT OF SENATOR THAD COCHRAN


    Senator Cochran. Mr. Chairman, thank you.
    I am pleased to join you and our distinguished friend from 
Missouri at this hearing.
    And thank the Food and Drug Administration officials for 
being here and the hard work they do to carry out their 
responsibilities.
    I ask that the balance of my statement be printed in the 
record.
    [The referenced statement was not available at press time.]
    Senator Pryor. Okay. Thank you, Senator Cochran. Thank you.
    Dr. Hamburg, welcome.


           SUMMARY STATEMENT OF HON. DR. MARGARET A. HAMBURG


    Dr. Hamburg. Well, thank you very much, Chairman Pryor, 
Ranking Member Blunt, and Senator Cochran.
    And congratulations to you, Chairman Pryor, in your new 
important position.
    And I also want to thank the subcommittee for your past 
investments in FDA which have helped to reduce the gap between 
our budget and the demands of our increasingly complex mission.
    I am joined today by Norris Cochran, who is the Deputy 
Assistant Secretary for Budget at the Department of Health and 
Human Services, and Jay Tyler, who is the Chief Financial 
Officer at the FDA.
    Congress has given FDA responsibility for a vast range of 
products that are central to the health, safety, and well-being 
of every American. From spinach and breakfast cereals to 
vaccinations that save millions of children's lives, to new 
medicines that treat major killers like cancer and heart 
disease, Americans rely on products overseen by the FDA every 
single day.
    We also recognize that those who produce our Nation's food 
and medical products are vital components of the U.S. economy, 
as is a strong FDA. History shows that when the public trusts 
FDA's oversight, these industries flourish, and when there are 
problems with products, it can result in severe economic damage 
across the industry involved, not just to the offenders, but to 
non-offenders alike.
    I want to mention some of our measurable accomplishments 
this past year. In 2012, FDA approved 39 novel medicines, the 
highest number in over a decade. The majority of these drugs 
were approved in this country before they were approved 
anywhere else in the world and some in as little as 3\1/2\ 
months.
    The number of drug shortages were cut in half, compared to 
2011. We successfully turned around a decade of lengthening 
medical device reviews and backlogs. Working together with 45 
State and territorial partners, we have conducted more than 
158,000 inspections of tobacco retailers to ensure that they 
are not selling cigarettes or smokeless tobacco to minors. And 
we just published our first two food safety proposed rules, as 
has been noted, as part of the implementation of the historic 
Food Safety Modernization Act. All of this indicates, I think, 
that FDA is a smart investment and a bargain, in fact.
    Consider, as all of you have commented, that the products 
we regulate represent more than 20 cents of every $1 that 
consumers spend on products in this country. But if you look at 
our budget, every American effectively pays only a little more 
than $8 a year for our services.
    And while FDA continues to oversee a multitude of products 
vitally significant to all of us, our job has become 
increasingly demanding. First, we are in the midst of dramatic 
changes in the ways that food, drugs, biologics, and devices 
are produced and reach the American public. We are witnessing 
revolutionary advances in science and technology that hold such 
promise to improve health and prevent disease, yet also bring 
new scientific and regulatory complexities. And we are facing 
the globalization of the food and medical product supplies, 
demonstrated by a quadrupling of FDA-regulated products over 
the past decade. For food, some 50 percent of fresh fruit and 
about 80 percent of seafood that we eat here comes from other 
countries. About 40 percent of finished drugs and 50 percent of 
devices are manufactured elsewhere, but cross our borders to be 
used in this country.
    Second, Congress has continued to expand our 
responsibilities with new laws, including FSMA, the most 
sweeping reform of our food safety laws in about 70 years; the 
Family Smoking Prevention and Tobacco Control Act, the landmark 
legislation giving FDA the responsibility to regulate tobacco 
products; and most recently, the passage of the FDA Safety and 
Innovation Act, or FDASIA, which, among other things, creates 
two new user fees to speed the review of more affordable 
versions of drugs, which are essential to holding down 
healthcare costs and also puts important focus on important 
aspects of advancing medical product innovation.
    As we look at our fiscal year 2014 budget needs, we must 
respond to the demands of complex and increasing 
responsibilities while recognizing the realities of a 
constrained economic environment. Thus, we must focus on a set 
of key mission-critical programs and activities and leverage 
limited resources to the greatest degree possible.
    The President's proposed fiscal year 2014 budget request is 
for a little over $4.6 billion, which includes $2.5 billion in 
budget authority and $2.1 billion in user fees. This represents 
an $821 million increase over fiscal year 2012, $52 million of 
which is budget authority and $769 million in user fees, 
including two new user fee proposals for food safety and 
cosmetics.
    A central component of the budget request supports our 
efforts to implement FSMA and create a modern food safety 
system based on prevention rather than responding after a 
problem occurs. FDA is committed to working with industry and 
our partners at all levels of Government along with the 
industry and produce community to put in place the necessary 
risk-based flexible system that recognizes and respects the 
varying needs of different components of our food enterprise.
    I want to thank you for the $40 million in one-time no-year 
money that was part of the recent continuing resolution, which 
will help us continue our outreach. For fiscal year 2014, our 
budget request is for $43 million in budget authority and $225 
million in proposed user fees for food facility registration 
and inspection and imports.
    In addition, we must respond to and harness modern science 
to advance the pipeline of new medicines and vaccines. We are 
asking for about $18 million to equip a number of already 
constructed buildings, including two labs, so that we can carry 
out the work needed to accelerate the development, review, and 
ongoing assessment of these vital medical products. Without 
these funds, the labs cannot be used and the $300 million cost 
of constructing them will be wasted.
    Also, in our efforts to safeguard a vast and increasingly 
hazardous global supply chain, we are asking for $10 million to 
expand our presence in China, a major and growing exporter that 
has also been the source of contaminated food and medical 
products in the past.


                           PREPARED STATEMENT


    I believe our fiscal year 2014 budget efficiently targets 
our needs, focusing on programs that are essential to providing 
Americans with the safe foods and effective medical products 
they expect and deserve. I look forward to answering your 
questions today and to working with you in the coming year.
    Thank you very much.
    [The statement follows:]

           Prepared Statement of Hon. Dr. Margaret A. Hamburg

    Good morning Chairman Pryor, Ranking Member Blunt, and members of 
the subcommittee. I'd like to extend my congratulations to you, 
Chairman Pryor, in your new role on the subcommittee. I am looking 
forward to working with you and your staff. And I would like to thank 
the subcommittee for its past investments in the Food and Drug 
Administration (FDA), which have helped us meet the demands of our 
broad and increasingly complex mission.

FDA PLAYS A VITAL ROLE IN THE HEALTH OF OUR CITIZENS AND OUR REGULATED 
                               INDUSTRIES

    Congress has given FDA responsibility for a vast range of products 
that are central to the health and well-being of every American. From 
spinach and frozen dinners, to vaccinations that save millions of 
children's lives, to new medicines for the treatment of major killers 
like cancer and heart disease, Americans rely on products overseen by 
FDA every single day. A short list of what FDA oversees includes:
  --the safety of most of America's food supply;
  --the safety and effectiveness of drugs, biologics, vaccines, and 
        medical devices;
  --the safety of the blood supply;
  --the development of medical countermeasures to address chemical, 
        biological, radiological, and nuclear threats, and infectious 
        diseases;
  --the safety of products that emit radiation;
  --the quality of mammography facilities services;
  --the safety of dietary supplements and cosmetics;
  --the nutritional quality of infant formula;
  --the safety of animal food and feed as well as the safety and 
        effectiveness of drugs for use in livestock, pets, and other 
        animals; and
  --Most recently, FDA has been charged with reducing harm from tobacco 
        use.
    The products we oversee are capable of producing great benefits: 
sustaining human life, reducing suffering, treating previously 
untreatable diseases, and extending lives. FDA's recent approval of the 
first drug to treat one of the causes of cystic fibrosis, as well as 
the first bionic eye system for a rare genetic condition, illustrate 
the ability of these products to transform lives. Without proper 
oversight, however, many of these products are also capable of causing 
great harm. We need only look at the recent outbreaks of foodborne 
illnesses from peanut butter or the newest report of counterfeit cancer 
drugs being imported into the United States to understand those risks.
    FDA has a dual responsibility to the public health--to make safe 
and effective products available to Americans as quickly as possible, 
while at the same time protecting our citizens from those products that 
injure or kill. Our citizens' health depends on both.
    We also recognize that the producers of our Nation's food and 
medical products are vital to the health of our economy--and a strong 
FDA is vital to their health as well. Our history shows that when there 
is public trust in FDA's oversight, our industries flourish. 
Conversely, when food and medical products cause serious harm, the 
result is often severe economic damage across the industry involved--to 
offenders and non-offenders alike.

  FDA CARRIES OUT ITS FAR-REACHING RESPONSIBILITIES WITH FEW TAXPAYER 
                                DOLLARS

    FDA is a true bargain among Federal agencies. Added together, the 
products we regulate represent more than 20 cents of every consumer $1 
spent on products in the United States. Americans each pay about $8 a 
year for FDA's appropriations, which is substantially less than the 
amount Americans spend each year on snack chips alone.
    And putting money into FDA is a smart investment. For about 2 cents 
a day, Americans get an extraordinary array of public health benefits, 
including: (1) life-saving medicines approved as fast or faster than 
anywhere in the world; (2) confidence in the medical products they rely 
on daily; and (3) a food supply that is among the safest in the world. 
But maintaining this level of performance for the American public, 
especially related to food safety, demands a fully funded FDA.
    Although FDA continues to be an effective and efficient investment, 
our job has become increasingly demanding. We are in the midst of 
dramatic technological and market-based changes in the way that foods, 
drugs, biologics, and devices are produced--from personalized medicine 
and nanotechnology to the globalization of our food and medical product 
supplies. Congress has also continued to pass new laws and expand our 
responsibilities. While we welcome these new responsibilities, they 
don't always come with added resources. These changes force us to 
stretch our limited resources, while finding ways to ensure the safety 
of a global supply chain. Our scientists must also adapt to, and even 
drive, new science and technology so that we can accelerate medical 
product innovation rather than impede it.
    Let me say a few words about the impact of globalization, which I 
believe to be among our greatest current challenges. Not that long ago, 
FDA's job was to oversee a largely domestic market of food and medical 
product suppliers. Most of the facilities in which these products were 
stored and manufactured were within our borders and relatively easy to 
inspect and oversee. Most of our producers and manufacturers were 
accustomed to operating under the rules of a modern regulatory system 
and most lived up to our high standards.
    We have now entered a brave new world--a world in which, very soon, 
the majority of our food and medical products will come in whole or in 
part from foreign countries. In the last 10 years, the number of 
imported shipments of FDA-regulated products has skyrocketed--in 2012, 
approximately 28 million shipments of imported food and medical 
products crossed our borders. That includes 50 percent of our fresh 
fruits and 20 percent of our fresh vegetables, around 80 percent of our 
seafood, and 40 percent of drugs on our shelves. Eighty percent of the 
manufacturers of active drug ingredients are located outside the United 
States, and more than half of medical devices are imported. Most of the 
increase in imports is coming from China and India, countries with 
limited regulatory oversight. Many other imports are from developing 
nations with even less regulation.
    The vast increase in imported foods raises the risk of 
contamination and illness. Of the imported produce and seafood refused 
entry at the border, 70-85 percent is for potentially dangerous 
violations, including the presence of disease-causing organisms and 
chemical contamination.
    The global marketplace also increases the threat of deliberate 
adulteration, fraud, and counterfeiting. Criminals exploit how hard it 
is to inspect and track products through the global supply chain. 
Chinese suppliers of heparin, a critical drug to prevent blood clots, 
substituted a lower cost, adulterated raw ingredient in their shipments 
to U.S. drug makers, causing deaths and severe allergic reactions. 
Chinese suppliers of wheat gluten substituted melamine, an ingredient 
used in making plastic, which was toxic when it was used in U.S. pet 
food and dairy products. The contaminated food sickened and killed pets 
across the United States and put many people at risk.
    The global supply chain itself is becoming increasingly complex. 
Each product may pass through a number of foreign links in the chain, 
and each additional link increases the risks to American consumers. 
Consider canned tuna. Once primarily canned in the United States, tuna 
processing and canning is now outsourced to foreign facilities, and 
tuna often takes a circuitous journey through processors and canners in 
Southeast Asia, Africa, and/or Latin America, before it is ultimately 
shipped to the United States for distribution to our grocery store 
shelves.
    The world has changed and our historical regulatory approaches and 
tools--such as hoping to intercept products at our borders--are 
outdated and often inadequate. Border inspections will remain important 
but they cannot guarantee the safety of even a small fraction of our 24 
million food and medical imports a year. Globalization demands a major 
change in the way FDA fulfills its mission. If we are to continue to 
promise Americans a safe food and drug supply, FDA must continue to 
transform itself--from a primarily domestic agency to one that uses 
innovative global strategies to secure a vast global supply chain. 
Although challenges lie ahead, we have already made strides toward this 
goal using the resources you have provided.

        FDA IS DELIVERING RESULTS THAT HELP AMERICANS EVERY DAY

Implementing Major New Laws
    We are partners with Congress in implementing the policies in three 
major new laws and several smaller ones that add to FDA's 
responsibilities in advancing the health of Americans.
    The Food and Drug Administration Safety and Innovation Act 
(FDASIA).--With the passage of FDASIA last year, Congress granted us 
important new authorities, reauthorized human drug and device user 
fees, and authorized new user fees for generic human drugs and 
biosimilars. These authorities and fees are intended to increase the 
speed and predictability of medical product reviews, better protect the 
drug supply chain, reduce drug shortages, and speed the review of more 
affordable versions of drugs that are essential in holding down 
healthcare costs. We are working hard to implement FDASIA and achieve 
these important goals.
  --Drug Approvals.--We continue to run a state-of-the-art drug 
        approval process that brings important new drugs to Americans 
        quickly and safely. In 2012, FDA approved 39 novel medicines, 
        and the great majority were approved in the United States 
        before any other country in the world. The drugs included 13 
        treatments for cancer patients, 13 orphan drugs, and the first 
        brain imaging agent to help rule out Alzheimer's disease. 
        Recognizing the need to bring safe, lifesaving drugs to 
        Americans as quickly as possible, FDA approved some of them in 
        as little as 3\1/2\ months.
  --Medical Device Approvals.--Over the past decade, important 
        indicators of the efficiency of the FDA's medical device review 
        program, including the average length of review and the size of 
        the backlog of overdue applications, had steadily worsened. 
        Since 2011, FDA has worked intensively to turn this around. 
        Almost every major indicator has now reversed: review times are 
        getting shorter and backlogs are shrinking. This important 
        turnaround will allow the industry to bring safe and effective 
        devices to market more quickly and at lower cost.
  --Drug Safety.--FDA has also used your investments to improve our 
        oversight of the safety of marketed drugs. The new Mini-
        Sentinel system allows us to quickly assess potential drug 
        safety problems using data from over 130 million patients. FDA 
        used Mini-Sentinel to assess reports that a new blood thinner, 
        Pradaxa, was causing more bleeding than similar drugs. The 
        results gave reassurance that bleeding rates were not higher 
        with Pradaxa than with the other drugs.
  --Drug Shortages.--FDA prevented 282 drug shortages in 2012--87 more 
        than in 2011. Early notification to FDA of potential shortages 
        has made a huge difference in our efforts. In 2012, we cut the 
        number of new shortages by more than half (117 v. 251).
  --Affordable Drugs.--FDA is working to provide Americans with better, 
        quicker access to affordable generic drugs and is also 
        implementing an abbreviated pathway for approval of biological 
        products shown to be ``biosimilar to'' or ``interchangeable'' 
        with an FDA-approved biological product. Biosimilars are 
        products that are similar to approved biologics, and while 
        biologics are among the most important drugs Americans use 
        today, they are also the most complex and expensive. We are 
        developing a science-based process for bringing safe and 
        effective biosimilar and interchangeable products to market, 
        which should increase competition and create substantial 
        savings for patients, healthcare providers, and insurers.
    The FDA Food Safety Modernization Act (FSMA).--Even though the U.S. 
food supply for humans and animals is among the safest in the world, 
the current rate of foodborne illness remains too high--according to 
CDC estimates, roughly one in six Americans (or 48 million people) get 
sick, 128,000 are hospitalized, and 3,000 die of foodborne diseases 
each year, leading researchers to estimate a cost of more than $75 
billion due to medical expenses and lost productivity. This does not 
include costs to the food industry or public health agencies. These are 
preventable human and economic costs, and they reflect an outdated food 
safety system. FSMA, the most sweeping reform of our food safety laws 
in more than 70 years, creates a modern food safety system that shifts 
our traditional focus--responding to contamination after it occurs--to 
preventing it before it happens. This new prevention strategy involves 
all participants in the food system, domestic and foreign, government, 
industry, and consumers, doing their part to minimize the likelihood of 
harmful contamination.
    FDA is working on regulations on the kinds of risk-based measures 
food producers and importers should put in place to reduce the risk of 
contamination. We take pride in our release earlier this year of two 
proposed rules that set science-based standards for the prevention of 
foodborne illnesses--one on safe growing and handling practices for 
produce and another on prevention practices in facilities that process, 
handle, and store food. Before drafting the proposed rules, FDA 
conducted extensive outreach with farmers, manufacturers, consumer 
groups, State and local officials, and the research community. We have 
just completed three public meetings across the country to get 
additional input from stakeholders.
    The proposed rules are built on existing voluntary industry 
guidelines and recognized best practices for food safety. Many 
producers already follow these guidelines, so compliance will be less 
of a burden. For those who need to add new food safety practices to 
their operations, FDA, in collaboration with USDA, will offer technical 
assistance and guidance.
    FDA is committed to working with industry members to provide the 
support they need, especially the smallest businesses. We know that our 
rules and oversight practices must be responsive to the diversity of 
operations covered by FSMA, be risk-based and flexible, and address 
small business concerns. That's why we've included a number of 
exemptions for small businesses, including one for farms. The produce 
rule would also exempt low-risk products, like potatoes that are rarely 
consumed raw, or that will be further processed with a step that kills 
bacteria--like vegetables that will be canned. We've also proposed that 
small farms and other small business be given extra time to come into 
compliance with both rules.
    The Family Smoking Prevention and Tobacco Control Act (Tobacco 
Control Act).--The Tobacco Control Act gives FDA responsibility to 
reduce death and disease caused by tobacco and to lessen tobacco use, 
especially the initiation of smoking, by children and teens. This 
program is entirely supported by tobacco industry user fees. Since 
enactment, FDA has worked to enforce a ban on cigarettes with candy and 
fruit flavors, to make them less appealing to kids; prohibit claims 
like ``light'' or ``mild'' that misleadingly imply products are safer; 
and enforce new smokeless tobacco warnings. FDA has also joined with 
States and Territories to enforce laws against under-age sales. We have 
conducted over 131,000 retail inspections and sent over 6,800 warning 
letters and 420 civil money penalty complaints to retailers.
    Other New Authorities.--FDA is also implementing other recently 
enacted laws. Last month Congress passed the Pandemic and All-Hazards 
Preparedness Reauthorization Act, strengthening FDA's authority to 
prepare for chemical, biological, radiological, and nuclear threats, as 
well as infectious disease emergencies like pandemic flu, and to 
support rapid deployment of medical countermeasures. FDA is also 
carrying out new requirements in the Affordable Care Act, including 
provisions on biosimilars and nutrition information on menus.

Safeguarding the Global Supply Chain
    Using the public's investments, the agency is working to transform 
itself into a public health agency capable of preserving the safety of 
our food and medical products in a complex global marketplace. We are 
developing better enforcement and regulatory tools, encouraging greater 
industry responsibility, increasing transparency and accountability in 
the supply chain, and increasing collaboration with international 
regulatory counterparts and other third parties.
    Foreign Posts.--To enhance our ability to oversee import safety, we 
now have 12 permanent FDA overseas posts in key locations around the 
world: three in China, two in India, three in Latin America, two in 
Europe, one in the Middle East, and one in South Africa.
    Foreign Inspections.--FDA conducted over 2,700 foreign inspections 
in fiscal year 2012, the largest number ever, exceeding last year by 23 
percent. We are on track to surpass that record this year.
    Border Screening.--To make the most of our limited border 
inspection resources, FDA developed PREDICT, a sophisticated computer 
screening system that uses intelligence from many sources--such as 
intrinsic product risks, past inspection results, and information about 
such threats as extreme weather that could spoil a shipment--to flag 
the riskiest imports before they arrive. This allows FDA to focus its 
border resources on those imports that are most likely to pose a 
danger, and at the same time easing entry of low-risk products. PREDICT 
has helped stop many contaminated products at the border. Recently, 
PREDICT flagged a large shipment of cucumbers from the Dominican 
Republic, which were contaminated by salmonella. PREDICT has also 
identified products with illegal pesticides, heavy metal contamination, 
filth, and decomposition, as well as substandard medical devices and 
improperly canned food.
    FDA also developed mobile handheld devices that allow our 
investigators to immediately identify products that may be counterfeit 
or adulterated. The counterfeit detection device uses light waves to 
detect irregularities in the chemical composition or labeling of a 
drug, while the chemical detection (IMS) device identifies 
inappropriate chemical compounds in a product. The IMS recently 
identified an unlawful prescription drug--one taken off the market 
because it can cause heart attacks and strokes--in a large number of 
imported dietary supplements for weight loss. We hope to fund the 
development and use of more such mobile handheld devices.
    Collaboration With Other Nations.--To address the vast number of 
imports successfully, we must build a global public health safety net 
by partnering with other nations. FDA has signed over 120 international 
arrangements with foreign counterparts to create mechanisms for 
information sharing and collaboration. We are actively using 
information from, and conducting joint inspections with, trusted 
foreign counterparts, and engaging in harmonization efforts on foods 
and medical products. For example, we have signed an arrangement with 
Brazil, Canada, and Australia to implement a Medical Device Single 
Audit pilot program under which a medical device inspection done by one 
regulator can be relied on by other regulatory agencies. Such programs 
can cut duplicative requirements for industry and allow us to better 
allocate our resources.

Supporting Biomedical Innovation
    The U.S. food and biomedical industries are among the most 
successful and respected in the world and FDA plays a key role in that. 
FDA is sometimes viewed as a barrier to the economic success and 
innovation of both industries, but that does not take into account the 
benefits FDA regulation brings them. Public confidence in a strong FDA 
fosters consumer trust in the safety, effectiveness and quality of the 
products we regulate. This, in turn, helps producers build their 
markets. For example, as FDA became the model for science-based drug 
approval around the world, its high standards spurred decades of 
medical advances and turned the U.S. pharmaceutical industry into the 
world leader in innovative medicines.
    As you know, I have made it a priority to help U.S. biomedical 
companies maintain their status as world leaders in innovation. It is 
well known that advances in biomedical research are not being 
translated into real world products as swiftly and surely as we all 
would hope. The time and costs of developing new drugs has been 
increasing. Yet despite increases in research and development, the 
pipeline of new, innovative drugs remains disturbingly limited. Serious 
public health needs, such as treatments for autism and Alzheimer's 
disease, are not yet being met, despite years of research and 
investment. And many drugs are not revealed to be unsafe or ineffective 
until the last stages of development, wasting valuable time and 
resources. Through its regulatory science programs, FDA is committed to 
helping to develop new knowledge and tools that can help translate 
basic scientific discoveries and approaches into life-saving medicines, 
and reducing the time, complexity and cost of drug and device 
development.
    Investment in FDA allows our scientists to support innovation 
through a range of activities, including:
  --the Innovation Pathway, which cuts the time and cost of developing 
        and reviewing breakthrough device technologies--the first to 
        benefit from the Pathway was a robotic arm controlled by a 
        microchip in the brains of patients with spinal cord injuries 
        or amputations;
  --greater use of genetic data to advance personalized medicine, 
        especially in cancer therapies;
  --new scientific tools and partnerships to learn earlier in 
        development whether a drug or device will work and be safe, 
        saving time and money now wasted on late-stage product 
        failures;
  --more guidance to industry early in technology development to help 
        bring important new products, like the artificial pancreas, to 
        market more quickly; and
  --more collaboration with companies earlier in development. When 
        companies come to us for help early in the process of testing 
        their products, experience shows that they can shave up to 5 
        years off their development time. That's a dramatic shortening 
        of the path to market.

Stretching Budget Dollars
    We have also made belt-tightening a priority. We have consolidated 
our information technology infrastructure and administrative functions 
across FDA, and put in place controls to cut the cost of travel, 
training and conferences. We are avoiding additional rent costs by 
making better use of existing office space through telework and office-
sharing, and we are reviewing contracts to cut service and product 
duplication.

                        CURRENT BUDGET REQUESTS

    The budget includes $4.7 billion, an $821 million increase from 
fiscal year 2012. Of this requested increase, user fees account for 94 
percent ($770 million). Mindful of the need to reduce spending, we seek 
a reduced budget authority in several areas, including a $15.4 million 
decrease for human drug, biologic, and medical device programs. We are 
also asking for a small number of increases, which are necessary to 
meet our growing duties and preserve the safety of our food and medical 
products:
  --An additional $43 million to carry out our responsibilities under 
        FSMA and to modernize our food safety system. These resources 
        will go to building prevention-based food and animal food and 
        feed safety systems, to reduce the toll of foodborne illnesses.
  --An additional $10 million, above fiscal year 2012, for overseeing 
        the safety of goods from China. This increase will add 16 new 
        inspectors in China, who can conduct more inspections and train 
        Chinese counterparts, strengthening our ability to prevent 
        safety problems before products reach the United States.
  --An additional $3.5 million, above fiscal year 2012, to improve the 
        development timelines and success rates for medical 
        countermeasures intended to protect against chemical, 
        biological, radiological, and nuclear threats and new 
        infectious diseases. The top priorities for these funds include 
        care for U.S. soldiers suffering from traumatic brain injury, 
        treatment of acute radiation syndrome, and supporting rapid 
        deployment of critical medical countermeasures in emergency 
        situations.
  --An additional $17.7 million to permit us to equip and obtain 
        certification for four already-constructed buildings, including 
        two labs, on the White Oak campus, so that they may begin 
        carrying out research to support biomedical advances. Without 
        these funds, the labs cannot be used and the $300 million cost 
        of constructing them will have been wasted. Moreover, we will 
        need to continue to pay rent for the old space occupied by FDA 
        staff.
    Under agreements negotiated with industry, we seek an increase in 
current law user fees of $500 million to support our drug, device, 
animal drug, animal, food and feed, color additive, export, and tobacco 
product programs. We also seek $269 million in proposed user fees, 
including $225 million for food facility registration and inspection, 
and imports, $31 million for animal drug application fees that are up 
for reauthorization this year, $19 million to strengthen our oversight 
of cosmetic safety, and $15 million for reinspection of medical product 
facilities.
    I know that some of you have expressed concern that proposed user 
fees for food producers will impose unexpected burdens, especially on 
small producers. Please be assured that food-related user fees, if 
authorized, will be developed in close cooperation with stakeholders.

                               CONCLUSION

    FDA's oversight of our food and medical products supply is 
indispensable to the health and well-being of every American. We carry 
out our broad public health responsibilities effectively and with few 
taxpayer dollars--even as those responsibilities are expanding as a 
result of new legislation, technological advances, and a globalized 
marketplace. Our fiscal year 2014 budget targets our spending 
efficiently, on programs that are essential to providing Americans with 
the safe foods and effective medical products they expect. I look 
forward to answering your questions today and to working with you in 
the coming year.

    Senator Pryor. And I know you have a couple of colleagues 
there to help if we get too bogged down in the weeds here. So 
we want to welcome them to the subcommittee as well. I know you 
introduced them.

                             BUDGET REQUEST

    Let me start here and just jump right in to your budget 
generally. As we have talked about a few moments ago, you 
prepared this budget before we passed the fiscal year 2013 
budget. That puts you at a real disadvantage, and we understand 
that. We are sensitive to that.
    We are not going to ask you to clarify that today, but I do 
hope that you and your team will work with us and our teams 
here on the subcommittee to try to update your requests and try 
to find the balance we need to find as we go forward. And I 
assume you are perfectly willing to do that and would agree to 
all work together on that?
    Dr. Hamburg. Absolutely. Willing and eager.
    Senator Pryor. Well, thank you very much. And again, we 
appreciate that. We just understand the circumstances, and I 
think everybody understands the circumstances we are in.

                             SEQUESTRATION

    Let me ask about the sequester. This is something obviously 
that has been in the news a whole, whole lot. We know how 
important it is. We also know that there have been news reports 
about the FDA losing the ability to conduct approximately 2,100 
domestic and foreign facility inspections for consumer safety.
    And now that the sequester is here and now that the cuts 
are taking effect, can you please provide us with an update on 
how the sequester is affecting your agency?
    Dr. Hamburg. Okay. Well, of course, the sequester is of 
significant concern to us, and overlaid on the additional issue 
of expanding responsibilities, these cuts will come at a cost. 
The sequester is about $209 million in terms of cut to FDA, 
$126 million in budget authority, and it is important to note 
also $83 million in user fees.
    We, at the present time, are trying to absorb the impact of 
sequester in ways that will have the least impact on the health 
of the public and our ability to move forward with critical 
programs. We are decreasing travel and conferences, training 
programs, cutting back on a range of consulting contracts and 
grants.
    Sad to say, we are already not at our full-time equivalent 
(FTE) caps, and so we won't be able to hire up as much as we 
would like. But we won't have to furlough anyone because we are 
under where we would like to be, where we think we actually 
need to be. But that is another area in which we will absorb 
some of the sequester cut.
    The issue around the user fees I think is an important one 
because we did work carefully with industry and with Congress 
to develop a program for the use of user fees in key areas of 
our medical product programs. And we will not be able to use 
all of those user fees to achieve the performance goals that 
were negotiated with industry, and I think that will be 
reflected in a slowing of some of our ability to build up key 
programs, to advance medical product review programs in 
critical ways. And I do think that this is a set of concerns 
for all of us.

                               USER FEES

    Senator Pryor. You anticipated my next couple of questions 
about the user fee because I think a lot of people would be 
surprised to know that you can't use a user fee, something you 
negotiated with the industry and everybody understands the 
parameters and how they will be used.
    Do you think--have you thought about how that is going to 
affect your negotiations and discussions with the industry 
going forward?
    Dr. Hamburg. Why, of course, I am very concerned about 
that. The process involves us sitting with industry and also 
the engagement of a broader set of stakeholders to really 
identify what are the critical issues and concerns, how can we 
strengthen programs and activities, and what are our key 
performance goals to measure, and then how do we measure 
progress toward those goals?
    Industry clearly expects that the money that they are 
putting forward to the FDA will support these critical goals 
and programs and activities, and I think industry has been 
surprised, as have been many others, that they would be the 
subject of cuts in the same way as budget authority. And I do 
think that it is something to think about the next time we sit 
down across the table to discuss these fees.
    Nonetheless, without these user fees, our programs would be 
seriously compromised in our overall resources to do critical 
tasks.

                          FOOD SAFETY USER FEE

    Senator Pryor. Yes, and I see that also with food safety 
user fees that you are proposing, and I have that concern that 
if--we can't act unless it is authorized by other committees 
here, and I am not sure those will be authorized.
    And I am wondering if you have thought through the 
possibility that they not be authorized, therefore not be 
appropriated. And how can you do the things you need to do on 
the food safety side if those user fees aren't there?
    Dr. Hamburg. Well, as we look at the program for food 
safety and the implementation of the Food Safety Modernization 
Act, clearly the goals of food safety modernization and moving 
toward this preventive model is a shared set of goals for 
industry and for the benefit of the American people, and I do 
think it is appropriate that our budget reflect a combination 
of a budget authority commitment and user fees.
    We have begun discussions with industry in this arena, and 
I think that those will be important discussions as we try to 
achieve what has been proposed in the President's budget and as 
we work with Congress in shaping the fiscal year 2014 budget. 
And the issue of how those user fees are authorized and 
appropriated is, of course, an important one, and there will 
need to be, of course, a legislative pathway for that.
    And I hope we can do it in a way that will maximize the 
benefits for everyone and protect those user fee funds for 
their intended use.
    Senator Pryor. Yes. Well, and I think, just as this 
develops over the course of the year, we just need to keep 
talking, and it is very important for us to know about your 
priorities. And we will work through all the ``what ifs'' as 
they come up.
    But again, thank you.
    I know we have been joined by several colleagues here. So I 
am going to turn it over to Senator Blunt and let you ask 
questions, and then we will move down the line.
    Thank you.
    Senator Blunt. Thank you, Mr. Chairman.

                             BUDGET REQUEST

    On maybe the biggest issue that we will need to work 
together on regarding the budget is getting the request in 
synch with what you need now. Because as the chairman 
mentioned, some of your requests were met in the continuing 
resolution.

                           WHITE OAK FACILITY

    For example, the move into the White Oak facility, I think 
that money is there now. Is that right?
    Dr. Hamburg. Well, we, in the continuing resolution--and we 
appreciate it greatly--there were monies given to us for the 
White Oak consolidation. We do have continuing needs. 
Unfortunately, those were not one-time only needs in terms of 
the White Oak consolidation.
    And as----
    Senator Blunt. But the move-in needs were one-time only, 
and the completion needs were one-time only, right?
    Dr. Hamburg. There are additional needs in order to 
complete the buildings.
    Senator Blunt. We need to talk about what those are.
    Dr. Hamburg. We would be delighted to sit down with you on 
that.
    [The information follows:]

    The additional needs to complete the White Oak Campus are as 
follows:
    FDA has $17.6 million in additional requirements in fiscal year 
2014 over the 2013 appropriation for the Offices and the Life Sciences-
Biodefense Complex, also known as the LSBC. These funds will ensure 
final commissioning and certification of specialized laboratories prior 
to occupancy. This includes installing and testing specialized 
equipment ($1.3 million) for building automation, operation and 
monitoring, conducting high-efficiency particulate air filter, 
pressurization control, and power tests, installing air sensors, 
determining primary bio-containment device effectiveness, and providing 
special containment equipment for the Biosafety Level-3 labs, also 
known as BSL-3 labs. The BSL-3 labs containment equipment and the 
vivarium's pH waste neutralization system are specialized systems that 
will also be maintained with this request.
    The fiscal year 2014 increase also includes decommissioning ($8 
million) the laboratories FDA is vacating at the National Institutes of 
Health and at Nicholson Lane, some of which we have occupied since the 
1960s. Decommissioning activities include complying with environmental 
regulations and mitigating any contamination caused by chemical, 
radiological and biological materials.
    Funds are also needed for critical operational and logistical 
functions on the White Oak Campus, including completion of the 
remaining campus security infrastructure. FDA will experience, as part 
of the LSBC and office move, a 50-percent growth over the current 
campus population as well as a 50-percent increase in building square 
footage that must be supported. Specifically, these funds will be used 
to develop and implement additional safety programs ($3.1 million) to 
support complex laboratories, including high containment specialty 
laboratories, expand the Central Utility Plant to support the new LSBC 
and Office Complex, and increased operational and logistical functions 
($5.2 million), including hazardous materials storage, handling, 
processing, and distribution.
    FDA must make this investment in early fiscal year 2014 to ensure 
that the offices and LSBC are operational and ready for occupancy. 
These buildings must be operational and meet safety requirements to 
serve critical CBER and CDER programs that help combat emerging 
infectious diseases and bioterrorism threats and ensure the safety of 
blood, tissues, stem cell therapies, vaccines and drug products.

                             SEQUESTRATION

    Senator Blunt. All right. We need to talk about what those 
are. And what amount of money did you say was being sequestered 
in fees?
    Dr. Hamburg. It is about $83 million.
    Senator Blunt. Eighty-three million?
    Dr. Hamburg. Million, uh-huh, and that is across a number 
of user fee programs in the medical product arena.
    Senator Blunt. And your overall shortage in these areas 
between now and September 30 would be less than the amount of 
money you think you need to complete the year?
    Dr. Hamburg. Well, we will have cuts through sequester to 
the user fee and the budget authority component of programs----
    Senator Blunt. Right.
    Dr. Hamburg [continuing]. That support our medical product 
review. So, overall, the sequester impact is $209 million.

                               USER FEES

    Senator Blunt. Assuming we went forward with the Budget 
Control Act, would you be supportive of the user fee categories 
being exempt from sequester?
    Dr. Hamburg. I don't know that I am the best person to 
speak to the overall policy, but I would be very eager to see 
the user fee monies protected in terms of their intended use, 
which, as I have mentioned before, were negotiated very, very 
carefully with industry in terms of a set of critical programs 
and activities and performance goals.
    Senator Blunt. And again, for the rest of this year for the 
FDA budget, the user fee sequester is $83 million. So this is a 
big amount of money.
    Dr. Hamburg. It is a big amount of money.

                             MENU LABELING

    Senator Blunt. All right. What about the easy to deal with 
topic of menu labeling? Where are you on that? When do you 
expect the FDA to issue its final rule?
    Dr. Hamburg. Well, we hope to issue that final rule soon. 
As you know, it has been an extended process. We have talked 
before about how I naively thought that menu labeling would be 
one of the easier to implement components of the law, but in 
fact, it has been very challenging.
    But we have had the opportunity for a process of notice and 
comment rulemaking, and we--in response to the proposed rule 
that we put forward, we did receive a very large number of 
comments. We are currently going through all of those and 
trying to finalize a final policy document, and we will be 
getting that out certainly by the end of this year, although, 
knock on wood, and as soon as we possibly can.
    Senator Blunt. By the end of this calendar year or by the 
end of this fiscal year?
    Dr. Hamburg. I was saying calendar year, but it is a high 
priority. We are trying to move forward with it. I can't tell 
you exactly when. And whenever I do make those kinds of 
statements, I always regret it.
    But we are moving into the home stretch, and I know that 
you have had many concerns about aspects of it. And we have 
heard those concerns, and they were reflected in the comments. 
But it has been a complex rulemaking process.
    Senator Blunt. Well, you and I both have learned a lot more 
about this than we would have ever expected to learn.
    Dr. Hamburg. Yes, exactly.
    Senator Blunt. And things like the small chain grocery 
stores, the food they have available in the store, drive-
throughs, locations that are almost exclusively delivery 
locations, how much posting do they need to do at the location, 
all those are things that obviously people are going to look 
very closely at when that rule does come out.

                           COSMETIC USER FEE

    The cosmetics industry, I understand that the FDA has been 
involved in some discussions with the industry looking for a 
science-based framework that would establish a uniform national 
standard. Do you want to comment on that at all?
    Dr. Hamburg. Well, we have had a number of discussions with 
industry about their desire for greater harmonization of 
approaches. There is an international forum for some of those 
discussions that meets regularly with other regulatory 
authorities engaged as well.
    We think it is an important set of activities, although 
different countries do have different legal regulatory 
frameworks for oversight of this area, which will not enable 
total convergence. But we think that these are important 
discussions to be having.
    We also do believe that there are opportunities for us to 
coordinate more closely with the cosmetics industry, and we 
expect to be having some more targeted discussions in the 
context of the proposed user fees.
    Senator Blunt. I think the industry is growing more 
concerned that there might be a lot of conflicting State laws, 
and some Federal definitions that were overriding would be 
helpful there.
    I know this is the second year in a row that you have asked 
for these cosmetics industry user fees. I think this year you 
estimate the fee would cost the industry a little over $19 
million. I am glad to continue to talk about that. I was 
opposed to that at the end of our discussions last year and 
probably will be again this year, but it is a topic that I am 
willing to talk to you about.

                            MEDICAL DEVICES

    On the medical device manufacturers, I understand that a 
number of countries have a country of origin first step. If you 
haven't been approved in the country the device is made, you 
just automatically cannot be approved in a number of countries 
around the world.
    Costa Rica appears to have been a very big beneficiary of 
this. I know there are 14,000 medical device jobs in San Jose 
now. Most of them are pretty new, and mostly because that 
government, more quickly than our Government, will give them 
the country of origin approval.
    Have you got some thoughts on how we deal with the medical 
device process going more quickly than it has been going? And 
they have a fee already that they are willing to pay. Is that 
right?
    Dr. Hamburg. Yes. Well, with respect to the issue of where 
manufacturing occurs, it often is a decision of companies in 
terms of costs of manufacturing, price of labor, and other 
incentives. And as you know, when the country requires that you 
be approved in that country in order to sell in that country, 
that is an important incentive as well.
    Senator Blunt. Yes, but to be sure we are talking about the 
same thing. This is where other countries require as their 
first step that you had to have approval in the country where 
the device was made before you could even apply for approval in 
the country you would like to sell it in.
    Dr. Hamburg. Well, that is a national policy. I do think 
with respect to Costa Rica, it is interesting to note that they 
accept the U.S. approval for devices as an approval within 
their own country because they do look to us in many ways as a 
gold standard for approval of these products.
    But we are working very hard with industry and within our 
own program processes and procedures to try to find ways to 
streamline our device review process as much as possible, to 
make it as clear and predictable as possible. We don't want it 
to be overly cumbersome, but we want it to provide appropriate 
protections to make sure that products are as safe and 
effective as possible for their intended use.
    We want to find ways to encourage manufacturers to remain 
in this country, to do their work in this country. And I think 
that we remain as a Nation a leader in medical device science 
and technology and continue to have strong exports in this 
area. But we want to make sure that our regulatory programs 
support that, but also, of course, address what is our core 
mission, which is the review of safety and efficacy.

                              TISSUE BANKS

    Senator Blunt. Two quick questions I will ask for the 
record unless we have time for a second round. One is, first of 
all, to preface a question on tissue banks, I want to thank you 
for personally taking time to get involved in that. I think 
there were four areas, following up on their meeting with the 
agency, that you all were looking at.
    One was to reissue the jurisdictional update guidance 
document and allow for a formal comment period. Two was to stop 
publishing FDA's descriptions of Tissue Reference Group (TRG) 
decisions that they felt had in the past sometimes been 
misleading. Three, review the FDA's TRG process to ensure that 
it is appropriately addressing current challenges. And four, 
your very generous commitment to see that they were meeting 
with your organization twice a year.
    So just your sense of the time on those four issues----
    Dr. Hamburg. Yes.
    Senator Blunt [continuing]. At some time when you could 
tell me that would be helpful.
    Dr. Hamburg. Okay. Terrific. I think we have had some good 
discussions and very useful to hear their concerns, and I think 
we are addressing them in a coordinated way.
    [The information follows:]

    1. Reissue the Jurisdictional Update guidance document and allow 
for a formal comment period.
    Answer. We have heard that some stakeholders have questions about 
this policy document, and we understand that there is a need for 
improved communication regarding regulatory policy in this area. We are 
currently considering how best to address this concern. We agree to 
look at this issue and report back on how we are addressing stakeholder 
communications regarding the policies described in this document.
    2. Stop publishing FDA's potentially misleading descriptions of 
Tissue Reference Group (TRG) decisions.
    Answer. The TRG was established in 1998. Since then, we annually 
have been publishing on our Web site summaries of TRG recommendations. 
We instituted this practice in recognition of the public interest in a 
transparent TRG process, an interest that was reiterated by Congress in 
the last appropriations report directing us to now publish these 
updates on a twice-yearly basis. Ending this practice would not serve 
important interests in transparency. However, we understand that 
industry has concerns that some readers generalize inappropriately from 
the summaries that we post on the Web site. In order to address that 
risk, we have added the following language to the TRG Web page where 
the updates are posted:
    Please keep in mind that updates to the TRG Annual Reports are 
stated in general terms in order to avoid revealing confidential 
information protected from disclosure. The TRG's recommendations are 
based on specific facts, which may not be provided in the updates. For 
these reasons, it may not be appropriate to generalize broadly from the 
updates. If you have questions about your specific product, please 
contact [email protected].
    3. Review the FDA's TRG process to ensure that it is appropriately 
addressing current challenges.
    Answer. An inter-center working group has analyzed and revised the 
TRG procedures, taking stakeholder comments and concerns into 
consideration. FDA has posted an updated Standard Operating Policy and 
Procedure (SOPP) for the TRG, and it is publicly available on the FDA 
Web site.
    4. Conduct two liaison meetings per year. (We understand the 
Commissioner has agreed to this item.)
    Answer. This request was made in 2012, and CBER/Off ice of 
Cellular, Tissue and Gene Therapy (OCTGT) agreed then to a twice yearly 
schedule for meetings with AATB. The Commissioner confirmed this 
arrangement when she met with AATB in early 2013.

                     FOOD SAFETY MODERNIZATION ACT

    Senator Blunt. And on the Food Safety Modernization Act 
rules, FDA took 2 years to draft the rules, yet they are 
allowing only 120 days for interested parties to comment. A 
number of those parties have requested an extension. I am 
hoping that you are looking at that extension, and I will be 
glad for some follow-up on that as well.
    Dr. Hamburg. Well, we appreciate that these are complex 
rules, the proposed rules, to go through and analyze, and we do 
intend to extend the comment period so that we can hear all of 
the concerns and address them fully. And I think it is a 
reasonable request.
    Senator Blunt. What are you going to extend by, 180 days?
    Dr. Hamburg. I think 120 days.
    Senator Blunt. So you are going to double the comment 
period?
    Dr. Hamburg. Yes.
    Senator Blunt. Okay. Thank you, Mr. Chairman.
    Senator Pryor. Thank you.
    Senator Cochran.

                             MENU LABELING

    Senator Cochran. Mr. Chairman, Madam Commissioner, I 
understand the Food and Drug Administration is having some 
difficulty in complying with or figuring out how to respond to 
the requirement that menus be labeled to show various things 
for the consuming public. Food retailers in my State of 
Mississippi have expressed some concerns, too, about how this 
affects them and how they are supposed to comply.
    What type of establishments do you foresee will be affected 
or governed by these new requirements?
    Dr. Hamburg. Well, the law was quite explicit about chains 
of 20 or more restaurants or vending machines in terms of the 
applicability of FDA regulatory oversight. Defining exactly 
what a--restaurant is fairly straightforward. A restaurant-like 
establishment is a more complex challenge in our modern world, 
with fast food stores and pizza delivery and the different 
kinds of models of in-grocery store cafes, et cetera.
    And that is really where the greatest challenges have come 
and where we have gone through an extended process of putting 
out proposals, asking questions, and seeking public comment. 
And we are trying now to go through all of that and compile the 
issues and concerns and reflect those back in a final rule, 
which we hope will be published very soon.
    Senator Cochran. Thank you.
    One other concern of importance in my State is with the 
catfish industry and the fact that labeling and certification 
of the wholesomeness of foods that are going to wind up being 
sold in stores or restaurants, whether or not these apply to 
foreign fish that come in and are imported into our country.
    To what extent are you involved in trying to sort through 
those challenges? What is the status of that?
    Dr. Hamburg. Well, I think that it is the case that in 
terms of seafood in particular, as you mentioned, there is a 
growing component of seafood in this country that is coming in 
from overseas, and we play a critical role in the oversight of 
all of that. And the import of seafood is one of the areas that 
surprised me in terms of the shifting of more and more imports 
coming from overseas.
    You mentioned catfish. That is a particular area of some 
regulatory complexity because, as I understand it, several 
years ago, Congress actually asked to shift the oversight of 
catfish to USDA from FDA, and that process is still in 
transition.
    And until Food Safety and Inspection Service (FSIS) at FDA 
fully takes it over, we are continuing to provide oversight in 
that area as well. We work with our partners to try to ensure 
the safety and quality of the seafood that Americans eat, 
wherever it comes from.
    Senator Cochran. Well, we hope that that can be resolved at 
an early date. I know it may be complex and challenging, but a 
lot of producers and those who are in business here in the 
United States are worried that it is being unfairly--or it may 
be unfairly applied to domestic producers, as compared with 
foreign importers.
    So, anyway, your personal oversight of that would be 
appreciated.
    Dr. Hamburg. Thank you.
    Senator Cochran. Thank you.
    Senator Pryor. Senator Tester.
    Senator Tester. Thank you, Mr. Chairman.
    And I want to thank Dr. Hamburg for being here and her 
service. And I just want you to know that bringing Thad 
Cochran's son to the subcommittee is not going to sway this 
subcommittee in the questions and answers. I assume that is 
correct, right, Thad?
    At any rate, welcome.

                     FOOD SAFETY MODERNIZATION ACT

    Look, I want to talk about the Food Safety Modernization 
Act a little bit, too. And I appreciate the ability to visit 
with you off the grid, too. I thank you very much for that.
    During the debate over the Food Safety Modernization Act, 
we had a very healthy discussion about where consumer risk 
comes from. One key question was whether the smallest 
companies, operating locally, selling at the farmer's market or 
at a local grocery store, pose the same kind of risk as the big 
national companies do.
    And while there were strong feelings on both sides of this 
debate, and they were strong, one thing that was lacking was 
any epidemiological data to support applying the same rules to 
small producers in isolated markets as we do to the big guys 
whose mistakes could reach every corner of the country in a 
very short order.
    So Congress, in order to avoid putting small producers out 
of business, did not apply those rules to qualified facilities. 
Congress did, however, require a study of the food processing 
sector, including facilities collocated on farms, and this 
report was to be completed before the promulgation of the new 
rules, and the rules were intended to be informed by the study. 
And correct me, if I am wrong on that.
    However, FDA did not release the study until January--
correct?--along with the proposed preventive control rule. Yet 
the study was dated November 2011.
    Can you please speak to why the agency did not release that 
report and seek comment on it before a proposed preventive 
control rule was released? It is about 13 months space.
    Dr. Hamburg. We are, as I said, trying to go forward with 
an open process with input from all stakeholders, and the 
opportunity to bring the best possible science to bear and data 
to bear and experience to bear on our rulemaking. I will have 
to get back to you on the specifics of the review process for 
that report.
    [The information follows:]

    Section 103(a) of the FDA Food Safety Modernization Act (FSMA) 
instructed FDA, in consultation with the Secretary of Agriculture, to 
conduct a study of the food processing sector. Section 103(a) of FSMA 
also instructed FDA to submit to Congress a report describing the 
results of the study not later than 18 months after FSMA's date of 
enactment. However, FSMA also required us to promulgate regulations to 
establish ``science-based minimum standards for conducting a hazard 
analysis, documenting hazards, implementing preventive controls, and 
documenting the implementation of preventive controls'' and to define 
the terms ``small business'' and ``very small business.'' The 
regulations were to be promulgated not later than 18 months after 
FSMA's enactment. Under contract with FDA, RTI International conducted 
the study, consistent with the FSMA requirements. Also consistent with 
FSMA, we have consulted with the U.S. Department of Agriculture (USDA) 
about the study. We also included the Food Processing Sector Study as a 
reference in the recently issued proposed rule for preventive controls 
for human food. The study provides information on the number of 
establishments and average sales per establishment by industry and size 
of operation. We used the study to inform the proposed rule's 
definitions of ``small business'' and ``very small business.''
    Although section 103(a) of FSMA did not require us to do so, we 
released the study for public comment along with the proposed 
preventive controls rule and the proposed definitions of ``small 
business'' and ``very small business.'' We took this action so that we 
could evaluate and address the comments, before we reported to Congress 
on the results of the study.
    In the preamble to the proposed rule, we described our plan as 
follows:

Consistent with section 418(l)(5) of the FD&C Act, FDA has consulted 
with USDA during its study of the food processing sector (Ref. 31). The 
study is available in the docket established for this proposed rule 
(Ref. 32). We request comment on that study. In section X.B.4 of this 
document, we discuss our proposed definitions for small business and 
very small business. We will consider comments regarding the study, as 
well as comments regarding our proposed definitions for small and very 
small business, in any final rule based on this proposed rule.

    78 FR 3646 at 3658. Thus, because the study is part of the 
administrative record for the rulemaking, we will consider comments on 
the study in the same manner as we would consider comments on any other 
reference in the administrative record.

    Senator Tester. I would like to because----
    Dr. Hamburg. Yes.
    Senator Tester [continuing]. In my review, it appears that 
the FDA did not examine any actual epidemiological data, but it 
relied on the process of expert elicitation. And essentially, 
academics in the field of food safety and research were 
surveyed on their experience.
    I think it is--well, point well taken. You will get back to 
me.
    Dr. Hamburg. I think we can have a rich conversation on all 
of the data that has gone into the development of these rules.
    Senator Tester. Super. And I thank you for that.

                     FOOD SAFETY MODERNIZATION ACT

    One question that arose during the consideration of the 
Food Safety Modernization Act was again whether farms that sell 
directly to consumers from farm stands on their own farms 
should be treated the same as farmers who sell directly to 
consumers out of a truck at a farmer's market, and it is 
essentially the same thing.
    Under the existing rules, this question has never been 
clear. A farmer that sells from his or her own property is 
considered a retail food establishment and not a food facility. 
The Food Safety Modernization Act required FDA to adjust the 
definition of a retail food establishment to ensure that a 
farmer selling his or her own food at a market would be treated 
the same way.
    Can you explain why the rules that were proposed last 
January do not address this issue, and do you plan on 
addressing it in the final rule?
    Dr. Hamburg. Well, of course, in the Food Safety 
Modernization Act there was what we finally call the ``Tester 
exemption,'' which speaks to some of these issues. But we have 
also been trying to build in flexibility in terms of the 
proposed rules and how they would be applied, depending on the 
activities that were being undertaken and the level of risk.
    We have really tried to engage in a lot of outreach and 
discussion to understand, noting that there is not a one size 
fits all. This is a complex and diverse enterprise, the food 
enterprise, and the needs of the produce-growing community are 
very different, depending on what you are growing, who you are 
growing it for, the size of the facility, et cetera. And so, I 
think we are really striving to reach the right balance.
    And food safety matters to the American public, whether you 
are big or small. But I think in terms of our regulatory 
oversight role, we do not want to have a one size fits all. We 
recognize the differences. We are trying to achieve a risk-
based approach that really does recognize the differences, and 
we are not striving to be unnecessarily burdensome. We are 
trying to find the right balance to protect health.
    Senator Tester. I very much appreciate particularly the 
statement the one size does not fit all. Because one size 
really doesn't fit all, and it doesn't fit all in most parts of 
Government and especially here.
    And where you have--and that is the whole thing. We want 
our food to be safe, no mistake about that. We are silly if we 
don't. But by the same token, we need to, just as we do in the 
financial area, fit the regulation to the risk.
    And so, I thank you for that. We will continue to follow 
up. My staff will continue to follow up with your staff on ways 
we can make this thing work because I think we both want it to 
work in the end and work well for the consumer without putting 
a bunch of folks who don't pose much of a risk at all out of 
business.
    So thank you for that.
    I talked to you a bit ago about a petition that was in 
front of the FDA that had over 1 million signatures on it that 
dealt with labeling of GMO [genetically modified organism] 
foods.
    Dr. Hamburg. Mm-hmm.

                       GENETICALLY MODIFIED FOODS

    Senator Tester. I am going to back up a little bit. When we 
talk about chemicals that are applied to food, they go through 
a rigorous, and I mean a rigorous, bunch of tests. The GMO 
issue is fairly new, 15 to 20 years, and in my perspective, 
from my opinion as a dry land dirt farmer, I will tell you that 
the amount of testing that is done on genetically modified 
foods is slim to none, and slim just left town.
    And so, my question to you is, is that with this petition 
in hand, it was originally submitted about 1\1/2\ years ago, 
November 2011, what are your plans? And I know in previous 
conversations, you talked about the plant where their corn, 
soybean, cotton, whatever, is really not changed much. But I 
don't know if there is tests to prove that.
    It is certainly a different plant than it was initially 
because there are traits in the environment. So what is your 
opinion on labeling? Is it something FDA is going to do?
    Dr. Hamburg. Well, we certainly understand that there are 
concerns about safety and environmental issues related to 
genetically modified foods in the public at large, and it has 
been the focus of a lot of scientific work and investigation. 
We support a consumer's right to know and voluntary labeling of 
genetically modified foods.
    Senator Tester. The problem is, is that I am not sure 
voluntary labeling is ever going to happen, or it would have 
already happened. Just a point.
    Thank you, Mr. Chairman.
    Senator Pryor. Thank you, Senator Tester.

                               COSMETICS

    I have a few follow-ups, if you don't mind, Dr. Hamburg? 
And that is on cosmetics. You know, we talked about user fees 
in other contexts. I am not sure we mentioned user fees in 
cosmetics.
    I know that you have been in negotiations with the industry 
on these. My understanding is they are concerned about timely 
and fairly rapid reviews of things and make sure that we have 
safe products to find that right balance we need.
    But are you in a position today to talk about your status 
of your negotiations with the cosmetics industry?
    Dr. Hamburg. You know, I think that we are at a very early 
stage in terms of some of the specifics, but we expect now that 
the President's budget has come out and there is a target as 
well, that we will be sitting down with the cosmetics industry 
in a much more focused way. And of course, we will be also 
bringing the fruits of our discussion to Congress as we move 
forward.
    Senator Pryor. Are you talking about setting up a national 
standard for regulation of cosmetics?
    Dr. Hamburg. Well, that, I think what we would be talking 
about with respect to the user fees would be more trying to 
define a shared agenda in terms of what are a couple of 
critical priorities in terms of our oversight of them in areas 
where the cosmetic industries think that they would benefit and 
where we think that through additional resources and 
identification of some key areas of activity, we could 
strengthen our program.

               NATIONAL CENTER FOR TOXICOLOGICAL RESEARCH

    Senator Pryor. Let me also just change the focus here for 
one moment to the National Center for Toxicological Research. I 
know that they do a lot of things in the nanotechnology world, 
which is very important. But this is a facility that also is 
looking at the safety of some high-profile issues like BPA and 
also antibiotics in food processing animals, pediatrics 
anesthetics, even something that is very current this week, 
ricin, trying to find the best inactivating agent for that.
    So, obviously, it does a lot of important work. And they 
certainly benefit your mission and are important to your 
mission. And I also know that you have a memorandum of 
understanding between the State of Arkansas, led by Governor 
Beebe, and also yourselves about trying to make sure that this 
is just a first-rate facility all the way around with a lot of 
collaboration and help going both ways between you and the 
University of Arkansas.

              VIRTUAL CENTER OF EXCELLENCE--NANOTECHNOLOGY

    Could you talk just a little bit about that memorandum of 
understanding (MOU) and the virtual Center of Excellence 
established by the MOU and just an update on that, please?
    Dr. Hamburg. Sure. Well, we are very excited about this 
project and the incredible support that we have gotten from the 
State of Arkansas and its outstanding academic institutions. It 
is an MOU with five academic institutions in the State, as well 
as the Government, and really enables us to move forward in a 
couple of critical ways.
    One is that we have created a training program in 
regulatory science, one of the first formal programs in the 
country, and we will be graduating our first group of 
accredited students in this area. And that really matters today 
and for the future, of course, in terms of really making sure 
that we have the strongest science-based regulatory programs.
    It also enables us to really focus on some critical issues 
like nanotechnology and study them at a very basic science 
level as well as all the way through the set of issues that 
arise, including clinical experience with the assessment of 
safety and efficacy of some of these products. So it really is 
a very unique resource.
    And as you note, the National Center for Toxicology 
Research is a unique entity in the country in terms of its 
focus, the kind of work it does, and its impact on critical 
issues to the American people. So I think this is really an 
outstanding program that we expect will yield a lot of benefits 
going forward.

                             NANOTECHNOLOGY

    Senator Pryor. Well, and I know that nanotechnology is 
really an emerging field, and it is a rapidly developing field. 
Do you feel like the FDA has the resources necessary to stay on 
top of all the changes that are coming with nano materials and 
nanotechnology?
    Dr. Hamburg. Well, of course, we could always use more. But 
we have a strong program. Nanotechnology is a very challenging 
area for us in the sense that nanotechnology is emerging and 
nano-based products are emerging across many domains of our 
activity--drugs, devices, foods, cosmetics. And in these 
different areas, they may raise different concerns.
    So I think it is very, very important that as this field is 
evolving, we are very engaged from the get-go in terms of 
thinking about both some of the safety concerns that are 
important to address, but also how best to harness this new 
technology and approach to benefit the American people.

                        BUILDING AND FACILITIES

    Senator Pryor. Right. I am not going to ask you to go 
through all the details on the answer to this next question. 
But I would ask you to provide us the documentation for your 
building and infrastructure needs. And I know you have been 
doing that, and obviously, it needs to be updated and made 
current.
    But I see the request that you have made, and I think it is 
important for us on the subcommittee to see all of your needs 
and look and see if there are ways that we can help with that, 
and we would like to really kind of do a top-to-bottom review 
of that and work with you on that because that is very 
important. And you can just submit that for the record when it 
is ready.
    Dr. Hamburg. Okay. Terrific.
    [The information follows:]

    The Building and Facilities (B&F) Program provides funding to 
construct, renovate, repair and improve FDA's 86 owned buildings and 
the associated infrastructure for at six sites where operations 
critical to FDA's public health mission are conducted. A total of 
approximately 1,400 staff and contractors are employed at these sites. 
FDA's owned assets include numerous laboratory facilities and a 
substantial amount of site infrastructure. It is critical to ensure a 
safe working environment for FDA employees. Improving the physical 
condition and operational reliability of these assets is also vital to 
supporting FDA's work to protect the Nation's health, security, and 
safety.
    FDA currently has an estimated Backlog of Maintenance and Repair 
(BMAR) of $120 million, which represents a comprehensive list of 
maintenance and repair deficiencies for buildings and site 
infrastructure. In addition, B&F funding is also needed to bring owned 
buildings into compliance with sustainable building standards and to 
accomplish renovations needed by FDA programs to meet regulatory and 
mission requirements.
    The Jefferson Lab Complex (JLC) site provides an excellent example 
of FDA's needs. FDA conducts mission research at its JLC site, which is 
occupied by the National Center for Toxicological Research (NCTR) and 
the Office of Regulatory Affairs' (ORA) Arkansas Regional Lab (ARL). 
This site represents more than 50 percent of FDA's owned square footage 
and BMAR. More specifically, there are at least seven laboratory and 
animal holding facilities that are in urgent need of attention with 
architectural, HVAC, electrical, and plumbing systems that have reached 
the end of their useful life. These buildings are in need of repairs 
and improvements to meet code and make them safe to meet FDA's mission. 
A Master Plan, which will identify required improvements and 
renovations to buildings and site infrastructure, and will propose a 
strategy to implement them over the next 5 to 20 years, is almost 
complete. In addition to addressing some of the above noted needs, the 
Master Plan also addresses critical needs for the construction of a 
Nanotechnology Core Facility and an addition to an existing Imaging 
Core Facility as well as initiating utility infrastructure support for 
a proposed Biotechnology Park (a.k.a., Bioplex) being spearheaded by 
The Economic Development Alliance of Jefferson County Arkansas of which 
FDA is an active member. Such vital improvement, renovation and 
construction projects cannot be completed without adequate B&F funding.
    Investing in FDA-owned facilities provides space for expansion and 
the ability to renovate and retool infrastructure to support the 
complex FDA mission while saving funds. By utilizing its owned space to 
maximum capacity, FDA can reduce the amount of rented space it 
requires. Jefferson Laboratories alone has approximately 40,000 square 
feet of space available for renovation and use, and 490 acres of land 
that could be made available for future construction.
    FDA ensures its mission support capabilities are resourced 
adequately to achieve program success and, in the past, has been able 
to defer its maintenance, repairs, and facilities improvement needs as 
program needs were of higher priority. But the scale has recently 
tipped due to the continuous decreased funding for the B&F Program. FDA 
has determined that years of underfunding this program has resulted in 
a risk to its mission and to the safety of its employees.
    The Agency can no longer defer its maintenance needs as we are 
experiencing system failures in our buildings and infrastructure which 
not only impact reliability and mission-critical research activities 
but also the health and safety of our employees. Funding is needed now 
for critical buildings and infrastructure projects to ensure mission 
accomplishment and a safe working environment for its personnel. FDA 
leadership is also weighing these needs heavily in the formulation of 
our fiscal year 2015 budget request.
    Below is information regarding FDA's six owned sites and the 
critical work conducted at these sites in support of FDA's public 
health mission:
    Jefferson Labs Complex (JLC)--Jefferson, Arkansas.--This site is 
occupied by NCTR and ORA's Arkansas Regional Lab. NCTR conducts 
critical research at this site that focuses on toxicity and risk 
assessment, nanotechnology, biomarker development, non-invasive 
imaging, and studying the extrapolation of data from animal studies to 
humans. ARL conducts testing and analysis in support of post market 
surveillance. ARL also conducts research, collaborative studies, 
regulatory inspections, and scientific consultations to support 
enforcement activities.
    Gulf Coast Seafood Laboratory--Dauphin Island, Alabama.--FDA's Gulf 
Coast Seafood Laboratory site is used by the Center for Food Safety and 
Applied Nutrition (CFSAN) to conduct research programs related to 
seafood safety, especially FDA-regulated seafood harvested from the 
Gulf of Mexico.
    Muirkirk Road Complex (MRC)--Laurel, Maryland.--This is a campus 
shared by CFSAN and the Center for Veterinary Medicine (CVM) to conduct 
research programs related to food and animal drug safety, toxicology, 
microbiology, and molecular biology. In addition, laboratories at this 
site are used as part of the Laboratory and Food Emergency Response 
Networks.
    Winchester Engineering and Analytical Center (WEAC)--Winchester, 
Massachusetts.--WEAC is an ORA specialty laboratory used to test the 
safety and performance of medical devices, microwaves, and 
radiopharmaceuticals; to conduct radionuclide testing with food 
samples; and to ensure seafood freshness.
    San Juan District Office and Laboratory--San Juan, Puerto Rico.--
The San Juan District Office is responsible for compliance with FDA 
regulations in the Commonwealth of Puerto Rico and the U.S. Virgin 
Islands (St. Thomas, St. Croix, and St. John). The San Juan District 
Laboratory is a National Servicing Laboratory that specializes in the 
testing and analysis of human drugs (pharmaceutical analysis) and 
provides support in team inspections as well as conducting independent 
inspections of contract laboratories, domestic and foreign.
    Los Angeles District Office and Pacific Regional Laboratory SW--
Irvine, California.--This location houses the Los Angeles District 
Office, which serves as ORA's inspection and compliance activity in 
Southern California and the State of Arizona. The pacific Regional 
Laboratory SW is a multi-functional laboratory performing predominantly 
import work in the Foods, Drugs, Cosmetics, Veterinary Feeds, and 
Medical Devices program areas. The lab also has specialized 
capabilities in the areas of Entomological basis of Filth and 
Sanitation, Regulatory Mass Spectrometry, and Regulatory Molecular 
Microbiology and Virology.

                            DRUG COMPOUNDING

    Senator Pryor. And the last thing I have really is I 
understand that you recently made an appearance before the 
House of Representatives, and maybe the issue of drug 
compounding came up over there?
    Dr. Hamburg. This is true.
    Senator Pryor. And I, like everyone else in the country, 
certainly on this subcommittee is very, very concerned about 
the fungal meningitis outbreak that we saw linked to the New 
England Compounding Center. And I also notice that in the 
budget, you are requesting, what is it, $3 million, if I am not 
mistaken?
    Dr. Hamburg. In the continuing resolution fiscal year 2013 
budget, we intend, with the agreement of this subcommittee and 
support of this subcommittee, to spend $3 million for issues 
related to expanding activities with respect to oversight of 
compounding pharmacies.
    We are, as you may know, very deeply involved in 
discussions with Congress, particularly on the Senate side, 
with respect to legislation that would give us new authorities 
that we very strongly feel we need to be able to provide better 
protection for some of the highest risk compounding facilities 
that are making sterile products that represent a greater risk, 
making them in advance of or without a prescription and selling 
them across State lines.
    We don't know what that legislation will look like. I am 
very hopeful that we will get it. But we will need to come back 
to you with additional requests over time as we really 
determine the nature and scope of our responsibilities in this 
area and what we will need to have the kind of strong and 
sustainable regulatory regime to address the safety of 
compounding pharmacies.
    Senator Pryor. Compounding pharmacies are a very important 
piece of the puzzle, and certainly we want those drugs to be as 
safe as they can be, just like all drugs. And obviously, a 
problem like we saw at the New England Compounding Center 
raises concern, and we look forward to working with you on 
that.
    Senator Blunt.
    Senator Blunt. Okay. Let us stay with that topic a little 
while. The $3 million that you would expect to commit between 
now and the end of this fiscal year on drug compounding, under 
what authority would you be getting more involved or do you 
need legislation to get involved? What would you spend it on?
    Dr. Hamburg. No, we have authority with respect to 
compounding pharmacies, but it is far more limited than the 
authorities. For example, we have over conventional 
manufacturers. As you probably know, compounding pharmacies 
have historically been regulated on a routine day-to-day basis 
by the States.
    But we are increasingly concerned that there are many large 
compounding pharmacies out there that are making these high-
risk sterile products, and we feel an obligation to be as 
aggressive as possible with our existing authorities to know 
who is out there making what and to make sure that there are 
not serious sterility concerns and other concerns that would 
put the American people at risk.
    We do not feel we have all of the authorities that we need 
to regulate this arena of compounding pharmacies and 
particularly these large compounding pharmacies that are 
behaving essentially as outsourcers to hospital networks and 
providing critical products to the healthcare system and to 
patients. And that is why we are seeking legislation.
    We don't have the authority, for example, to require that 
all of these facilities register with us and tell us what they 
are making. We don't have the authority to go in and fully 
inspect them, get access to their records and take samples. We 
don't have the authority to hold them to a uniform set of 
national standards or the authority to require that these 
compounding pharmacies report adverse events to us when they 
learn about them and about their products.

                      DRUG COMPOUNDING LEGISLATION

    So we think that everyone would benefit by legislation that 
would clarify and strengthen the FDA oversight role.
    Senator Blunt. Now I would think, and I would be pleased to 
have your comments on this, that there is an argument to be 
made on the manufacturing side where a compounder is making a 
significant quantity of a compounded product to then be sold, 
as opposed to the pharmaceutical side where a pharmacist is 
compounding one product for one prescription.
    That obviously would take a whole lot more oversight than 
on specific manufacturing facilities. Am I off base there in 
looking at that that way?
    Dr. Hamburg. Well, we recognize the role of traditional 
compounders, and we do not want to oversee all compounding 
pharmacies in this country. But the industry has been evolving, 
and the healthcare system needs have been evolving. And there 
is this new sort of hybrid of compounding pharmacies that are 
making larger volumes and higher risk products, and we do feel 
that that is a gap in our current regulatory framework.
    If we were, as has been suggested by some, to treat this 
group of compounding pharmacists and pharmacy facilities as 
manufacturers, because they are doing some things that look 
more like manufacturing in many ways in terms of volume and 
some of the kinds of products that they are making, that would 
have very, very serious implications for the healthcare system 
and patient needs.

                APPROACH TO DRUG COMPOUNDING REGULATION

    You spoke earlier about the need for sort of a thoughtful, 
balanced approach to regulation. Our current authorities might 
push us to treating a range of compounding pharmacies like 
conventional manufacturers, and that would almost certainly put 
many of those companies out of business, both the good actors 
and the bad actors.
    We don't want a system that will unnecessarily compromise 
important industry and important manufacture of critical 
medical products, but we also want to make sure that those 
compounding pharmacies are appropriately regulated. We believe 
that we can find a balanced approach that will require those 
pharmacies that are making the high-risk sterile products in 
advance of or without a prescription and shipping to other 
States in a way that fits appropriate safety standards and good 
manufacturing practice for the products they make so we can 
assure quality.
    We want to be able to know who they are and what they are 
making and to routinely inspect them and get access to 
everything that we need. We want to make sure that these 
compounding pharmacies are making safe, high-quality products. 
But we also don't want to apply a sledgehammer if that isn't 
what is needed.
    And that is why we want to work with Congress to achieve 
the kind of regulatory authorities that we need to best serve 
the American people at the end of the day.
    Senator Blunt. Well, I think it is very important how you 
define the role you want to play for the FDA in the future so 
that this doesn't later become: We have the right to go in and 
check on every pharmacist in America and how they filled every 
prescription.
    Dr. Hamburg. Believe me.
    Senator Blunt. You may have some right to do it, but 
clearly, the tools to do that would be, in my view, beyond our 
reach.
    Do you have any idea how many of these kinds of facilities 
there might be? Are we talking about hundreds or dozens?
    Dr. Hamburg. Well, we don't really know the full landscape 
because they aren't required to register with us in terms of 
these higher risk compounding pharmacy facilities. We know 
there are about 28,000 compounding pharmacies across the 
country, or at least these are the estimates that we get from 
industry.
    Of those, there are probably about 7,500 specialty 
compounders, and a subset of those, some 3,000 are making the 
higher risk sterile products that I was just talking about.
    Senator Blunt. Well, my thought on this would be to let us 
draw this line as appropriately and tightly as we can, if you 
really want to get this done, as opposed to broaden the scope 
to the point that so many people are so concerned that nothing 
happens.

                   DRUG COMPOUNDING ISSUE IN MISSOURI

    We had a problem in Missouri with this, as I mentioned to 
you, on some cancer drugs. As I recall about 20 years ago a 
pharmacist was knowingly not giving the right prescriptions and 
saving the cost of those drugs.
    We have very tight laws because of that. I think we are one 
of only two States that give pharmacists a specific license to 
make a specific compounded product and that was a result of 
that problem. And still, if a pharmacist wants to violate the 
law and eventually run the risk of going to prison, they could 
still not do what they are legally obligated to do.
    I don't know what is in a pill or what is in a compounded 
product, either one. I have to trust somebody in that process, 
and I think there may a place that we can define this in a way 
that allows us to do that.

                        DRUG COMPOUNDING FUNDING

    I still don't quite know what you are going to do with the 
$3 million between now and the end of the year. So why don't 
you have somebody prepare that information.
    Dr. Hamburg. Okay. Well, we would be happy to. But we are 
going to use it to continue some of the inspections that we 
have been doing, follow up on the inspections and----
    Senator Blunt. Maybe when I see how you are going to spend 
that money, I will know what you are able to do now, compared 
to the gap that is still out there to be filled. And do you 
have an estimated cost of what it would take to regulate these 
manufacturers of the kinds of products you have described?
    Dr. Hamburg. Well, we are certainly looking at those costs. 
What an overall program would cost depends on ultimately how we 
move forward with legislation and new authorities and defining 
this category of nontraditional compounders that we were just 
discussing. Because as I said before, we understand the 
importance of traditional compounders, and we have no interest 
and clearly don't have the resources to take on the whole 
activity, and it has historically been a State responsibility.
    But we do have real concerns about the safety of the 
American people in light of an evolving industry, and we do 
feel that we do need additional legal regulatory tools and 
authorities and we will, in order to implement that, need 
additional resources as well.

                  GENETICALLY MODIFIED ORGANISM FOODS

    Senator Blunt. Right. And on the topic that Senator Tester 
raised, I heard, I thought, two pretty different views of that. 
One was on the testing of GMO foods, he said the testing was 
somewhere between slim and none, and slim has left town. So I 
guess that means none.
    You said a lot of scientific work and investigation here. 
You do have to decide whether these products can become part of 
a consumable food product. Is that right?
    Dr. Hamburg. We do provide oversight of the safety and 
wholesomeness of foods, whether they are genetically modified 
or not, yes.
    Senator Blunt. And the scientific basis, the science that 
you look at has led you to believe that any of these products 
that are in our current food supply are safe, or they wouldn't 
be there?
    Dr. Hamburg. We do not believe that there are existing 
threats to health from these products.
    Senator Blunt. As I understand it, the Department of 
Agriculture is involved at deciding what products can be 
planted and grown, and then you come in at some point and 
decide what the potential food uses of those might be, as 
opposed to other uses?
    Dr. Hamburg. Well, there are many components to this 
question.
    Senator Blunt. If you want, the one question I will ask 
that maybe narrows that. Where does USDA leave off in a GMO 
product and you take over?
    Dr. Hamburg. Well, we don't proactively review the product 
in the way that we review a drug on a routine basis. We are 
reviewing now GE salmon, which I am sure you are aware of. And 
actually that is being reviewed under our veterinary drug 
program, and it is the first in its class in terms of a 
genetically modified product that is coming before us.
    And that is being reviewed in terms of safety clearly. But 
our overall food program, I mean, not every food that goes into 
the marketplace is reviewed and approved by the FDA for safety, 
but we monitor safety issues, of course.
    Senator Blunt. Then this is one of the topics you would be 
monitoring, along with lots of others?
    Dr. Hamburg. Genetically modified foods? We are responsible 
for overall safety, quality, wholesomeness of the food supply. 
With respect to those areas in the FDA domain, of course, as 
you know, USDA regulates meat, poultry, and processed eggs.
    Senator Blunt. Right. One of the few products we don't grow 
in our State, and I think Arkansas, is sugar beets. We grow no 
sugar beets. But I know there was a sugar beets case a few 
years ago. After the product was approved by USDA, within 5 
years about 95 percent of the crop was this product. If you 
bought sugar beets, you were almost certain to be buying that 
sugar beet because it did whatever apparently the sugar beet 
growers wanted a sugar beet plant to do, and 95 percent of the 
crop was sugar beets.
    And there was a court case that was not about food safety, 
but whether it had been properly tested by USDA on 
environmental standards. A Federal judge said I think they 
ought to test it some more. USDA appealed that. The higher 
judge said, no, you have done all you needed to do to test it.
    But in the interim, there was some question about whether 
all the sugar beets in the country, or 95 percent of them, 
could be harvested and sold that year. But the question was not 
about the food quality or the food safety. It was about whether 
there were other environmental impacts, and higher court 
decided, no, there weren't.
    But I thought that there was a lot of science on this, and 
you apparently think so, too.
    Dr. Hamburg. I do.
    Senator Blunt. I thank you, Chairman.
    Senator Pryor. Thank you.
    Senator Cochran, do you have anything further?
    Senator Cochran. Mr. Chairman, I would like to express our 
appreciation to the panel for being here today and for the job 
you are doing, heading up this very important agency.
    Thank you for cooperating with our subcommittee.
    Dr. Hamburg. Thank you.
    Senator Pryor. And thank you.
    Dr. Hamburg, I would like to thank you again for being here 
and bringing your team here. I look forward to working with 
you. This was a great hearing.
    And Senator Blunt and I and the whole subcommittee here 
look forward to working with you on this year's bill as we go 
through that process.

                     ADDITIONAL COMMITTEE QUESTIONS

    And for members of the subcommittee, if you have any 
additional questions that you would like to ask for the record, 
we would ask that you get those within 1 week. So that is 
Thursday, April 25.
    And Dr. Hamburg, if you could make your responses available 
within 4 weeks of that time, that would be very much 
appreciated.
    [The following questions were not asked at the hearing, but 
were submitted to the Department of response subsequent to the 
hearing:]

              Questions Submitted by Senator Mark L. Pryor

                     PROPOSED FOOD SAFETY USER FEES

    Question. If the new proposed user fees aren't authorized, what 
does that mean for FDA's ability to implement the food safety law?
    Answer. The proposed user fees are critical to ensure that FDA is 
able to fully implement the FDA Food Safety Modernization Act of 2011 
(FSMA). The two major food safety user fee proposals, a Food Import Fee 
and a Food Facility Registration and Inspection Fee, are estimated to 
generate $166 million and $59 million, respectively. Not having this 
$225 million in fees authorized and appropriated will severely limit 
FDA's ability to implement FSMA and to create a modern food and feed 
safety system that is prevention-oriented, science- and risk-based, and 
efficient. In particular, FDA would not have the resources necessary to 
modernize the import system by improving the accuracy and efficiency of 
inspections. Without additional resources, FDA will not have sufficient 
capacity to develop the guidance documents necessary to support 
implementation of the preventive controls and produce safety 
regulations and to conduct outreach and educational activities for 
industry and regulatory partners. FDA will not be able to hire and 
train investigators for import oversight, nor will it be able to 
modernize compliance programs and inspection practices to improve 
efficiency and overall effectiveness of FDA's public health activities. 
FDA will not be able to develop a network of shared State and Federal 
laboratory data and perform planned assessments of States enrolled in 
the Manufactured Food Regulatory Program Standards.
    We hope to continue to work with Congress and industry on this 
important issue.
    Question. Assuming we are working under the same budget restraints 
as you are, please send us information as quickly as possible on what 
the highest priority activities are that would have been funded with 
the user fees.
    Answer. FDA's highest priorities for the fiscal year 2014 food and 
feed safety program are developing and implementing preventive control 
and produce safety standards, increasing the frequency and accuracy of 
domestic and foreign inspections, training of regulatory partners in 
new inspection protocols, building the capacity of FDA State partners, 
and implementing FDA's new import authorities. Of these important 
priorities, FDA's efforts in import safety would be the most adversely 
affected if the new user fee proposals are not authorized and 
appropriated.
    The fiscal year 2014 resources would support comprehensive, 
prevention-focused import food and feed safety programs that will place 
greater responsibility on those in the food supply chain--food and feed 
manufacturers, processors, packers, distributors, transporters, and 
importers--to ensure that imported food and feed are as safe as those 
produced domestically. Without these resources, FDA would not able to 
develop and implement a variety of approaches to ensure the safety of 
imported foods and feeds, including assessments of foreign food safety 
systems and capacity building for foreign industry and regulatory 
partners. FDA would also not be able to use data generated by these 
activities to prioritize FDA food and feed safety monitoring activities 
and thereby enhance the safety of the U.S. food and feed supply. Not 
having these additional resources would hamper FDA's efforts to improve 
consumer protection by allowing FDA to make better informed decisions 
about the admissibility of imported food and feed products.

                     BUILDING INFRASTRUCTURE NEEDS

    Question. Please provide the Committee with the funding that would 
be required to address the current backlog of essential maintenance and 
repairs at all FDA-owned facilities.
    Answer. FDA currently has an estimated Backlog of Maintenance and 
Repair (BMAR) of $122 million, which represents a comprehensive list of 
maintenance and repair deficiencies for buildings and site 
infrastructure. In addition, the Building and Facilities (B&F) Program 
funding is also needed to bring owned buildings into compliance with 
sustainable building standards and to accomplish renovations needed by 
FDA programs to meet regulatory and mission requirements.
    The B&F Program provides funding to construct, renovate, repair and 
improve FDA's 85-owned buildings and the associated infrastructure for 
six sites where operations critical to FDA's public health mission are 
conducted. Approximately 1,212 staff and contractors are employed at 
these sites. FDA's owned assets include numerous laboratory facilities 
and a substantial amount of site infrastructure. It is critical to 
ensure a safe working environment for FDA scientists. Improving the 
physical condition and operational reliability of these assets is also 
vital to supporting FDA's work to protect the Nation's health, 
security, and economy.
    The Agency can no longer defer its maintenance needs as we are 
realizing system failures to our buildings and infrastructure, which 
not only impact reliability and mission-critical research activities 
but also the health and safety of our employees. Funding is needed now 
for critical buildings and infrastructure projects to ensure mission 
accomplishment and a safe working environment for our personnel.
    Question. Please list the amount of maintenance and repairs 
necessary, by location, in order of the Facility Condition Index.
    Answer. The table below provides a breakdown of the BMAR for each 
of the FDA's six owned locations in order of their respective site 
Facility Condition Index scores.

  FOOD AND DRUG ADMINISTRATION OWNED ASSETS--BACKLOG OF MAINTENANCE AND
            REPAIR (BMAR) AND FACILITY CONDITION INDEX (FCI)
------------------------------------------------------------------------
                  Site                      Total BMAR       Site FCI
------------------------------------------------------------------------
Winchester, MA..........................       7,168,893           47.86
Jefferson, AR...........................      92,897,341           72.79
San Juan, PR............................       2,936,248           77.88
Laurel, MD..............................      17,368,120           80.91
Dauphin Island, AL......................         775,482           82.96
Irvine,CA...............................         945,339           97.01
                                         -------------------------------
      Total.............................     122,091,423  ..............
------------------------------------------------------------------------

                       HIGHLY COMPLIANT IMPORTERS

    Question. The Committee included report language in fiscal year 
2012 which strongly encouraged FDA to ``establish a pilot project to 
expedite imports for highly compliant importers.'' In addition, section 
713 of the FDA Safety and Innovation Act directed FDA to establish a 
partnership program for highly compliant importers by January 2014. Can 
you update us on FDA's efforts to implement both of those pieces of 
guidance? Will you meet the January 2014 deadline and if not, why?
    Answer. FDA has implemented the PREDICT program that facilitates 
entry of lower risk products while targeting higher risk projects for 
additional review. Additionally, FDA is in the process of developing 
two programs that should help to facilitate the import entry of 
products from highly compliant importers: the Voluntary Qualified 
Importer Program (VQIP) for Food and Feed and the Secure Supply Chain 
Pilot Program for pharmaceuticals.
    VQIP is a voluntary program under which food and feed importers may 
submit an application for expedited review of entries, based on the 
risk of the food being imported.
    FDA continues to work on the operational design of VQIP authorized 
under FSMA and is close to completion. Currently, IT requirements are 
being addressed and importer user fees are in development.
    The Secure Supply Chain Pilot Program will increase the likelihood 
of expedited entry for pharmaceuticals that meet the criteria for 
selection under the program. The Secure Supply Chain Pilot Program 
should allow FDA to assess the various entities and processes involved 
in a repetitive-type import chain, and if found acceptable and if all 
information is accurately submitted at the time of entry, would allow 
for expedited processing of entries.
    FDA plans to announce the start of a pilot program in order to 
evaluate the Secure Supply Chain Program. FDA also is planning a public 
meeting to gather additional input on all the provisions of section 713 
which is a much broader authority than the development of partnership 
programs. The information provided through the pilot program and the 
public meeting will help inform the regulations that need to be 
developed. FDA is developing a timeline for full implementation that 
ensures we have adequate public input.
    Question. How many importers have expressed their intention to 
enroll in the Secure Supply Chain Pilot, and has pursuing the pilot 
prevented FDA from implementing a partnership program like that 
described in section 713 of FDASIA?
    Answer. As the pilot program has yet to be announced, we do not 
have definite numbers on how many firms would be likely to participate. 
FDA intends to limit participation to 100 qualified applicants during 
the pilot phase.
    Question. Would FDA consider establishing an advisory panel, 
similar to the Commercial Operations Advisory Committee at the Customs 
and Border Protection, on import operations? The goal would be to help 
FDA incorporate or account for best practices of U.S. importers, as 
well as help coordinate import operations among its Centers.
    Answer. FDA would consider establishing an advisory panel.

                      SEQUESTER FOR GENERIC DRUGS

    Question. Specific to the newly enacted Generic Drug User Fee Act, 
how will sequester of the user fee funds affect the progress of FDA's 
implementation of the new program?
    Answer. Sequestration may threaten FDA's ability to fulfill the 5-
year performance commitments made under the Generic Drug User Fee 
Amendments of 2012. Delays in addressing the backlog of generic drug 
applications will slow patient access to new, more affordable generic 
drugs.
    Question. As you know, the program was enacted to address the 
previous backlog of more than 2,700 generic drug applications and to 
provide parity in domestic and overseas facility inspections. It was 
anticipated that approximately 900 new full-time equivalents (FTEs) 
would be added to FDA staff to address this backlog, and that 25 
percent of these FTEs would be added in fiscal year 2013. Could 
sequester of the user fee funds delay hiring of these new FTEs and 
further delay addressing the backlog and providing parity in facility 
inspections?
    Answer. As a result of sequestration, FDA may be unable to fully 
implement the new user fee program. The fiscal year 2013 hiring goal of 
25 percent is expected to be met, but the Agency's commitments to 
improving review timelines for generic drug submissions--including 
reviews of the previous backlog of applications--may not be achievable, 
including achieving risk-adjusted parity between domestic and foreign 
facility inspections. If sequestration continues to impact user fees 
after fiscal year 2013, the hiring goals outlined in the 5-year GDUFA 
agreement with industry may not be achieved.

                        SEQUESTER IMPLEMENTATION

    Question. With the implementation of sequester, including the user 
fees paid by industry, how are you working to continue to meet 
performance goals set under the various user fee acts?
    Answer. As a result of the sequester, FDA will have fewer resources 
than we had assumed when we agreed to the performance goals in our user 
fee program commitment letters. Consequently, FDA may not be able to 
meet some of these performance goals. FDA continues to look for more 
efficient ways to use the resources we receive, and to apply those 
resources to the highest priority activities that will protect and 
promote public health by providing timely access to safe and effective 
medical products. In the short term, we have had to delay some less 
urgent yet still important activities, such as some of the new 
enhancements to our user fee programs, as well as certain training and 
professional development activities that allow our staff to stay 
current with emerging science and technology.
    Question. Are you prioritizing activities not directly related to 
drug and device review in such a manner to ensure that you are making 
the best effort to continue to meet those performance standards?
    Answer. Yes, FDA is setting priorities, using a risk-based 
approach, for both drug and device review goals and goals not related 
to review, to help ensure the health, safety, and well-being of the 
American people while we manage our programs with fewer resources than 
planned. We must balance our efforts to meet drug and device review 
performance goals with our responsibility to monitor the safety of the 
products that are already available, and our need to respond to 
emerging safety problems.

                     DIETARY GUIDELINES FOR SEAFOOD

    Question. FDA has not yet updated its 2004 advice to pregnant women 
on seafood consumption, despite new USDA dietary guidelines and 
multiple commitments from the Agency to Congress to do so. Can you 
commit to issuing this updated advice this summer, and if not, by what 
date will this be issued?
    Answer. FDA first issued fish consumption advice relating to 
methylmercury in 1994. The advice was updated in 2001 and again in 
2004. The 2004 advice was issued jointly by the Food and Drug 
Administration and the Environmental Protection Agency. Its purpose was 
to protect against the possibility of neurodevelopmental harm to the 
fetus and to infants from methylmercury as a result of their mother's 
consumption of fish and to protect young children from the possibility 
of neurodevelopmental harm from methylmercury as a result of their own 
consumption of fish. Since then, studies published in the scientific 
literature indicate that, under certain circumstances, fish consumption 
by pregnant women and young children may actually improve 
neurodevelopment. The Dietary Guidelines for Americans 2010, the 
Government's nutritional recommendations issued every 5 years by the 
Departments of Health and Human Services and Agriculture, have already 
taken this development into account by recommending that pregnant and 
nursing women eat at least 8 and as much as 12 ounces per week of fish 
lower in mercury. The 2004 FDA/EPA advice does not contain this 
consumption target nor does it mention a potential neurodevelopmental 
benefit from fish since the evidence for it did not exist in 2004. We 
are devoting a significant effort to update the fish consumption advice 
and to complete a quantitative assessment of the net effects of fish 
consumption during pregnancy on neurodevelopment in order to have a 
sound analytical underpinning for that advice. These continue to be top 
priorities for FDA. FDA will update the Committee when specific 
information about the timing of the release is available.
                                 ______
                                 
                Questions Submitted by Senator Tom Udall

                         SUNLAND PEANUT COMPANY

    Question. It is my understanding that Sunland worked very closely 
and cooperatively with the FDA to address the issues found at the 
peanut butter plant and that they will be coming back on line with the 
FDA's stamp of approval.
    Could you outline for the Committee how this use of new authority 
worked in New Mexico, and your thoughts on where the new authority was 
helpful in ensuring a safe product in the end?
    Answer. By using our new authority provided by the FDA Food Safety 
Modernization Act to suspend facility registrations, FDA was able to 
ensure the safety of public health by not allowing Sunland to 
distribute its peanut and nut butter products until appropriate action 
was taken to remedy the salmonella contamination in its facilities. The 
new tool allowed FDA to take swift action to prevent continued 
distribution of food that had a reasonable probability of causing 
serious adverse health consequences or death.
    Question. Has the FDA used this same authority to revoke operating 
certificates elsewhere since the process was carried out in New Mexico?
    Answer. FDA has not used this authority elsewhere.
    Question. Has the experience with Sunland led to any improvements 
in how the FDA will carry out this new authority in the future, 
especially as it relates to interaction with companies or businesses 
who are in violation of food safety standards?
    Answer. FDA has continued to refine our internal processes for 
utilizing the new suspension of facility registration authority based 
on the valuable experience acquired during the Sunland activity. This 
acquired knowledge and experience will facilitate further use of this 
new authority for companies or businesses that present a significant 
risk to public health.

                       SMALL PRODUCER/PROCESSORS

    Question. In writing the Food Safety Modernization Act, Congress 
included a number of provisions to ensure that small and very small 
farms and food businesses were not unduly burdened by new regulations. 
I am pleased to see that the agency has included in its proposed rules 
longer compliance periods and modified requirements for certain small 
farms and businesses.
    Could you tell me what kind of feedback the FDA is getting from 
small farms and businesses on the proposed rules?
    Answer. FDA has engaged in extensive outreach efforts to inform 
farmers and businesses of the provisions of the proposed produce safety 
rule and the proposed preventive controls rule for human food. In 
addition to three public meetings held across the country, there have 
been six State-sponsored meetings (Ohio, Michigan, North Carolina, 
California (2), Georgia) about the proposed produce safety rule and 
numerous other outreach sessions via meetings and webinars. These 
efforts have allowed the FDA to answer questions regarding the proposed 
rule and to hear feedback from its various stakeholders. Organizations 
and groups whose stakeholders include small farms and businesses have 
been included in this outreach plan. Some small farms and businesses 
have expressed interest in the agency's compliance and enforcement 
plans for the proposed rules as well as the process of a withdrawal of 
a qualified exemption. Questions have been raised about the potential 
cost of compliance with the rules, particularly certain water testing 
requirements in the proposed produce safety rule. Additionally, small 
farmers have asked questions about the requirements in the proposed 
produce safety rule for application of untreated biological soil 
amendments of animal origin. FDA's outreach efforts have provided a 
platform to provide information regarding these and other questions. 
Generally, this particular stakeholder segment has indicated their 
interest and appreciation for the flexibility that was built into the 
proposed rules, such as the fact that the proposed rules would not 
apply to certain small farms and businesses and the establishment of a 
framework for alternatives to certain requirements of the proposed 
produce safety rule. Small farmers and businesses have also inquired 
about the availability of technical assistance or potential avenues 
that can provide such assistance. It is important to note that the 
comment period for the proposed rules will remain open until September 
16, 2013, and we anticipate receiving further feedback. FDA is 
committed to continuing to work with small farms and businesses, to 
address their concerns and ensure that the final rules are flexible and 
practicable while enhancing public health protection.
    Question. I am concerned about the cost of compliance that FDA 
estimates for small businesses. I understand that FDA estimates that 
the costs to comply with its proposed produce rule for farms with less 
than $250,000 in annual revenue will face over $22,000 in compliance 
costs. These additional costs could make or break a small business.
    Do you expect that these estimates are accurate?
    Answer. Based on the data available and FDA's understanding of the 
current practices of the produce industry, these estimates represent 
the most accurate costs for a farm to comply with the proposed rule. 
The $22,000 estimate cited is actually an average cost for farms 
between $25,000 and $250,000 in annual revenue. This means that the 
cost of compliance may be higher for some farms closer to the high end 
of that distribution and lower for those farms closer to the low end. 
We recognize that the potential costs of the regulation are not trivial 
and that some covered farms, especially those that need to make 
significant changes in their practices to comply with the risk-based 
provisions of the rule, may find it difficult to comply. Therefore, 
when the rule is finalized we intend to offer considerable technical 
assistance to small farms, and to help them comply through later 
compliance dates for small and very small farms, guidance documents, 
and the efforts of the Produce Safety Alliance, a public-private 
partnership dedicated to the development and dissemination of science- 
and risk-based training and education programs.
    Question. Could you discuss what the agency plans to do to assist 
small businesses, including businesses operated by limited resource 
producers and beginning producers, in complying with the proposed rules 
and in easing this cost burden?
    In updating our Nation's food safety laws, Congress also recognized 
that training is an important part of a modern food safety system. 
Unfortunately, the current budget environment has made it difficult to 
provide additional funding for much-needed training for farmers and 
food processors on food safety practices.
    Answer. Regarding the proposed produce safety rule, FDA is 
committed to working with the produce community and with partners in 
the U.S. Department of Agriculture (USDA), State agencies, and foreign 
governments to facilitate compliance through education, technical 
assistance and regulatory guidance. The agency recognizes that the time 
needed to comply will vary and as such, the rule proposes to phase in 
compliance dates based on farm size. FDA has, together with USDA's 
Agricultural Marketing Service, established a jointly funded Produce 
Safety Alliance (PSA), a public-private partnership, housed at Cornell 
University, that will develop and disseminate science- and risk-based 
training and education programs to provide produce growers and packers 
with fundamental food safety knowledge. A first phase of PSA's work is 
intended to assist farms, especially small and very small farms, in 
establishing food safety programs consistent with the Good Agricultural 
Practices Guide and other existing guidances so that they will be 
better positioned to comply when we issue a final produce safety rule 
under section 419 of the Federal Food Drug and Cosmetic Act.
    In addition, FDA has also entered into a memorandum of 
understanding with USDA's National Institute of Food and Agriculture to 
establish a competitive grant program to provide food safety training, 
education, extension, outreach, and technical assistance to: (1) owners 
and operators of farms; (2) small food processors; and (3) small fruit 
and vegetable merchant wholesalers. FDA is currently working with USDA 
to execute the competitive grant program, which will prioritize 
projects that target small and medium-sized farms.
    Regarding the proposed preventive controls rule for human food, FDA 
is committed to working with the food industry, especially small and 
medium-sized businesses, to facilitate compliance. The rule proposes to 
have later compliance dates for small and very small facilities. In 
addition, FDA, in cooperation with the Institute for Food Safety and 
Health, has created the Food Safety Preventive Controls Alliance to 
develop training courses and materials to help industry, particularly 
small- and medium-sized companies, when the rule is finalized.
    Question. Could you discuss how FDA is addressing this need and 
what resources FDA would need to work with other agencies and 
organizations to address the need for training of processors and 
producers?
    Answer. FDA is committed to working with the food industry and with 
partners in the U.S. Department of Agriculture, State agencies, and 
foreign governments to facilitate compliance through education, 
technical assistance and regulatory guidance.
    We plan to work with our stakeholders to develop a network of 
institutions that can provide technical assistance to the food industry 
(including the farming community), especially small and very small 
businesses, as they endeavor to comply with the provisions of the final 
rules.
    FDA intends to further facilitate compliance with the final rules 
through the development and dissemination of guidance, in multiple 
languages.
    Additionally, FDA staff will continue engaging in various outreach 
efforts including listening sessions, webinars, teleconferences, and 
presentations as these provide the agency with an immeasurable 
opportunity to hear feedback from its various stakeholders.
    FDA has requested $27 million and 21 FTEs in the fiscal year 2014 
President's budget for the development of science-based standards and 
guidance documents that support industry adoption of preventive 
controls for food processing and produce safety standards, as well as 
to provide training and outreach to regulatory partners and industry on 
these new FSMA standards.
                                 ______
                                 
                Questions Submitted by Senator Roy Blunt

    Question. Commissioner Hamburg, in addition to providing incentives 
for innovation, the Biologics Price Competition and Innovation Act was 
intended to expand access and lower the cost of life-saving and life-
improving medicines.
    How is the FDA progressing on implementing the pathway?
    Answer. FDA continues to develop rigorous scientific standards to 
ensure that all biosimilar and interchangeable products meet these 
statutory requirements, and thus will be safe and effective. Some of 
this effort is reflected in three draft guidances FDA issued in 2012 
that provide FDA's scientific recommendations on demonstrating 
biosimilarity, and we have begun developing guidance on additional key 
scientific issues as well. FDA is actively engaging with sponsors 
interested in developing biosimilar products to ensure that the 
development programs will provide the necessary scientific evidence to 
meet the statutory requirements for biosimilarity. Healthcare 
professionals and consumers can be assured that FDA will require 
licensed biosimilar biological products to meet the Agency's exacting 
standards of safety and efficacy.
    Question. Have applications been filed or other significant actions 
taken by potential applicants?
    Answer. To date, FDA has not received an application for a proposed 
biosimilar product. The Center for Drug Evaluation and Research (CDER) 
continues to meet with sponsors interested in developing biosimilar 
products. As of May 21, 2013, CDER has received 56 requests for initial 
meetings to discuss development programs involving 12 different 
reference products and has held 38 initial meetings with sponsors. Many 
biosimilar development programs that have had an initial advisory 
meeting with CDER have moved into the development phase and are 
requesting biosimilar product development (BPD) meetings. CDER is 
actively engaging with these sponsors, including holding BPD meetings 
and providing written advice, for ongoing development programs for 
proposed biosimilar products. To date, CDER has received 17 
Investigational New Drugs (INDs) for biosimilar development programs, 
but several additional development programs are proceeding under a pre-
IND.
    Question. As to the naming of biosimilars, it is my understanding 
that the FDA in 2006 issued a statement in support of the international 
naming regime. Is that still the policy position of the FDA? If not, 
please explain what has changed and why?
    Answer. FDA is currently considering the appropriate naming 
convention for biosimilar and interchangeable products licensed under 
the pathway established by the Biologics Price Competition and 
Innovation Act of 2009 (BPCI Act) enacted as part of the Affordable 
Care Act. FDA is carefully reviewing and considering the comments 
submitted to FDA's biosimilar guidance and public hearing dockets. We 
will take into consideration all received comments as we move forward 
in finalizing the guidance documents and developing future policies 
regarding biosimilar products and interchangeable products.
                                 ______
                                 
             Questions Submitted by Senator Mitch McConnell

    Question. In my home State of Kentucky, prescription drug abuse is 
responsible for about 100 drug overdose deaths a month. I have received 
letters from law enforcement and public health officials expressing 
their concern with the effects this epidemic is having throughout my 
State. In light of these grave statistics, I would appreciate answers 
to my questions regarding FDA's recent activity to prevent further 
misuse and abuse of prescription drugs. FDA has informed Members of 
Congress that it has the authority under the Federal Food, Drug, and 
Cosmetic Act to require that generic versions of an innovator drug with 
abuse-deterrent features also include similar features as a condition 
of approval. In addition, FDA has stated it has the authority ``to 
initiate procedures to withdraw non-abuse-deterrent versions already on 
the market.'' When and how will FDA act on this acknowledged authority 
to require non-abuse-deterrent drugs to be withdrawn from market?
    Answer. If FDA concludes that an extended-release opioid drug 
product has abuse-deterrent properties, it has authority under the 
Federal Food, Drug, and Cosmetic Act (FD&C Act) to require generic 
versions of that product to also have abuse-deterrent properties. FDA 
recently approved labeling regarding the abuse-deterrent properties of 
one product, OxyContin (oxycodone hydrochloride) controlled-release 
tablets, and determined that a previous formulation of OxyContin was 
withdrawn for safety and effectiveness reasons, thus precluding 
approval of a generic version of the previous formulation. Because 
there were no approved generic versions of the previous formulation, 
there was no need for a withdrawal. FDA will continue to review other 
purportedly abuse-deterrent opioid drug products on a case-by-case 
basis and will take regulatory action regarding each product as 
appropriate.
    Question. FDA's new drug product exclusivity regulations (21 U.S.C. 
355(c)(3)(E)(iii)) prohibit the approval of an abbreviated new drug 
application (ANDA) for 3 years if certain criteria are met. While 
abuse-deterrent products are an important piece of prescription drug 
abuse prevention, providing access to lower cost, generic abuse-
deterrent drugs is important for legitimate users. Does a new drug 
product applicant need to apply for additional exclusivity, or does FDA 
make the exclusivity determination regardless of the applicant's 
request?
    Answer. FDA determines whether any of the available exclusivity 
periods under the FD&C Act applies to a given drug product at or after 
the time of approval of a new drug application (NDA). An NDA applicant 
is not required to specifically request exclusivity.
    Question. Beyond Fast Track and Priority Review status, how does 
FDA plan to incentivize the development of generic and innovator abuse-
deterrent formulations?
    Answer. FDA is working in variety of ways to incentivize the 
development of abuse-deterrent formulations of drugs with the potential 
for abuse, with a focus on opioids. First, as called for in FDASIA 
section 1139 and in the Office of the National Drug Control Policy 
National Plan on Prescription Drug Abuse, we published a draft guidance 
entitled Abuse-Deterrent Opioids: Evaluation and Labeling, in January 
2013. In it, in addition to laying out the studies and analysis the FDA 
is looking at when we consider new formulations for their effects to 
reduce abuse, we also included FDA's current thinking on how we will 
reflect those data in labeling. The goal of this last activity is to 
incentivize the development of new formulations of opioids that we 
determine to be abuse-deterrent, by including a clear description of 
their effects on abuse in labeling. To further this work, we are 
participating in a public meeting in the Fall to discuss the draft 
Guidance and solicit scientific input on improving it. We know that 
there is broad interest in the development of generic drugs with abuse-
deterrent properties, and we are working internally on the science 
needed to give guidance on how we will evaluate those products. We also 
intend to discuss generics at the meeting in the fall. Finally, the 
FD&C Act also provides for certain periods of marketing exclusivity if 
the applicable criteria are met.
    Question. What process and timeline will FDA use to make 
determinations on other innovator products on the market as to whether 
or not they meet the definition of abuse-deterrent and warrant a label 
change?
    Answer. FDA plans to make determinations regarding other 
potentially abuse-deterrent opioid drug products as promptly as 
possible using our standard review processes. For a labeling change, 
for instance, a sponsor will normally submit an application to request 
approval of labeling describing a product's abuse-deterrent properties 
and FDA would notify them in a letter whether their proposed labeling 
language is approved once our review and decisionmaking is completed.
    Question. How will these guidelines apply to generics seeking to 
come to market with abuse-deterrent features?
    Answer. FDA has not published any guidelines regarding generic 
versions of opioid products with abuse-deterrent features. As stated 
previously, if FDA determines that an extended-release opioid drug 
product has abuse-deterrent properties, it has authority under the FD&C 
Act to require generic versions of that product to also have abuse-
deterrent properties.
    Question. How does FDA plan on monitoring the marketing of new 
abuse-deterrent products to ensure that unintended consequences of 
aggressive marketing tactics do not occur due to a label change?
    Answer. FDA will monitor drug marketing practices with that concern 
in mind. FDA will apply the standards applicable to promotional claims 
concerning any prescription drug; that is, among other things, all such 
claims must be truthful and not misleading. 21 U.S.C. 352(a) and (n).
                                 ______
                                 
            Questions Submitted by Senator Susan M. Collins

    Question. Dr. Hamburg, I am pleased that the FDA issued the final 
guidance in November 2012 for the development of artificial pancreas 
systems. As you know, many of my colleagues and I are very interested 
in seeing that these potentially life-changing systems are made 
available to patients as soon as possible, with proper consideration 
given to safety and effectiveness. In development across the country 
but not yet approved by the FDA, these systems have the potential to 
address the serious problem of blood glucose control that exists for 
many people with type 1 diabetes using current treatments. Artificial 
pancreas systems could also save taxpayer dollars--a recent study found 
that Medicare could save almost $1 billion over 25 years with the use 
of this technology in adults. The FDA's official guidance is an 
important stepping stone in accelerating the development of the 
technology, as it provides the FDA's general expectations for 
conducting human outpatient clinical trials and for marketing approval 
of the devices. Dr. Hamburg, could you tell me how the FDA plans to 
support this momentum when new submissions for clinical trials or 
product approval are brought to you so that these innovative systems 
can be tested without delay and made available to those with type 1 
diabetes in the near future?
    Answer. We believe that the development of an Artificial Pancreas 
(AP) is within technological reach and have assigned significant 
resources to facilitate such development. At the beginning of 2012, we 
streamlined the AP application review structure. This has resulted in 
quicker reviews of investigational protocols and premarket submissions. 
Among those, we have approved several outpatient studies in adults and 
a diabetes camp study in children.
    We co-sponsored a public workshop with the National Institutes of 
Health (NIH) and Juvenile Diabetes Research Foundation (JDRF) in March 
2013. The workshop initiated a multidisciplinary discussion which will 
help to accelerate the development and delivery of an AP. We continue 
to pursue outreach efforts with researchers, clinicians, policymakers, 
manufacturers and patient advocates to help clarify expectations, and 
to help solve challenges as they arise. This collaborative effort is 
helping the FDA to make more rapid decisions on studies and will help 
to ensure that patients will receive these technologies as soon as 
possible. We look forward to working together with the diabetes 
community to advance quickly towards an approved AP.
    Question. I also would like to inquire about the rules recently 
published for public comment by the FDA under the Food Safety 
Modernization Act. The proposed rule governing standards for produce 
safety includes most fruits or vegetables while they are in their raw 
or natural (unprocessed) state. Apple growers in Maine are concerned 
that some of the new requirements might be overly burdensome and 
expensive to implement. They also question the inclusion of apples in 
the rule since apples are not a fruit which has been responsible for 
any significant food-borne disease outbreaks in our country. I realize 
that the comment period for the rule has been extended, Dr. Hamburg, 
and I am interested to hear your comments on this issue.
    Answer. The proposed rule's regulatory approach is aligned with the 
FDA Food Safety Modernization Act, which directs the Secretary to set 
forth procedures, processes, and practices that the Secretary 
determines are reasonably necessary to prevent the introduction of 
known or reasonably foreseeable hazards into produce and to provide 
reasonable assurances that the produce is not adulterated. As explained 
in the proposed rule, we tentatively concluded that an approach that 
considers both the risk associated with the commodity and that 
associated with the agricultural practices applied to the crop under 
the conditions in which it is grown would provide the most appropriate 
balance between public health protection, flexibility, and appropriate 
management of different levels of risk.
    The Produce Safety rule, as proposed, does not cover produce that 
is documented to receive commercial processing that adequately reduces 
the presence of microorganisms of public health significance. An 
example of commercial processing that meets this requirement is 
processing apples into juice in accordance with the Juice HACCP 
regulation (21 C.F.R. Part 120). In addition, the types of produce the 
Agency proposed to cover have one or more pathways through which they 
can become contaminated. FDA is proposing that farmers control only 
pathways that are relevant to their crop. For example, generally, water 
used for drip or furrow irrigation in apple orchards would not be 
subject to the proposed rule's requirements for agricultural water 
because the water is unlikely to contact the harvestable portion of the 
crop.
    We considered covering only those produce commodities or commodity 
groups that had been associated with foodborne illness outbreaks. 
Because only a small percentage of outbreaks are both reported and 
assigned to a food vehicle, outbreak data may not provide a complete 
picture of the commodities upon which we need to focus to minimize 
current and future risk of illness.
    Our data show that the patterns of outbreaks associated with 
produce commodities change over time. Occasionally a produce commodity 
that has not previously been linked to foodborne illness is associated 
with an outbreak. For these and other reasons discussed in detail in 
the proposed rule, our regulatory approach does not rely solely on a 
static list of commodities prepared solely from a history of outbreaks. 
In the Produce Safety proposed rule, we explicitly seek comment on our 
tentative conclusions related to our proposed regulatory approach. FDA 
will reach its final conclusions on this issue after considering 
comments received. The comment period for the proposed rule closes on 
September 16, 2013.
    Question. I would like to ask for your thoughts on a topic that has 
received a great deal of news coverage in recent years and one that is 
of much interest to many of my constituents, which is the issue of 
antimicrobial resistance. I have been working with Senator Gillibrand 
on legislation that, among other things, would call for the FDA to 
conduct a pilot study to better determine relationships between sales 
and use data of food animal drugs, and trends in antimicrobial 
resistance. As you know, each year the FDA's Center for Veterinary 
Medicine publishes sales data on the total volume of antibiotics used 
in the United States in food animals. Section 105 of the Animal Drug 
User Fee Act of 2008 requires antimicrobial drug sponsors to annually 
report not only the amount of antimicrobial active ingredient in the 
drugs they sold or distributed for use in food-producing animals, but 
also requires animal drug sponsors to list the target animal and 
production class specified on the approved labels of the products. The 
summary data that the FDA publishes each year, however, reports only 
total sales volume. Is FDA able to provide more specificity in this 
summary data in future reports, to include target animal species and 
production class, since this data is already required to be reported?
    Answer. On July 27, 2012, FDA published an Advance Notice of 
Proposed Rulemaking (ANPRM) to solicit comments from the public on 
possible enhancements to the existing requirements related to the 
collection of antimicrobial drug sales and distribution data. The ANPRM 
also solicited input on alternative methods for monitoring 
antimicrobial use in food-producing animals.
    Based on comments received, FDA is currently developing 
enhancements to the content and format of its annual summary report on 
the sale and distribution of antimicrobial drugs intended for use in 
food-producing animals. These enhancements would be consistent with 
current requirements. For example, FDA is exploring alternative 
approaches for reporting the data it currently receives. This includes 
approaches suggested in comments submitted in response to the July 2012 
ANPRM, including presenting the data by dosage form, medical 
importance, and marketing status (i.e., over-the-counter drugs, 
prescription drugs, or the Veterinary Feed Directive Guidance). FDA 
expects to use such an enhanced format when it summarizes the data 
reported for 2012.
    FDA also expects to utilize the rulemaking process to enhance 
existing requirements related to the collection of drug sales and 
distribution data. For example, FDA is examining the feasibility of 
establishing requirements for obtaining estimates of sales broken down 
by animal species. Currently, sales data is not required to be reported 
by target animal species.
    To supplement the sales/distribution data that it already receives, 
FDA is also exploring possible mechanisms for collecting additional 
information that would be more reflective of what antimicrobial drugs 
are actually being used in food-producing animals, including 
information that could be used to correlate drug use practices with 
trends in antimicrobial resistance.
    Question. Are you able to provide the Committee an idea of when the 
final version of Guidance for Industry No. 213 might be published?
    Answer. A final version of Guidance for Industry No. 213 is 
currently undergoing review and clearance. Although FDA does not have a 
specific timeline, publication of final Guidance for Industry No. 213 
remains a top Agency priority for 2013.
                                 ______
                                 
             Questions Submitted by Senator Lamar Alexander

    Question. The budget for FDA includes an unprecedented amount of 
funds from industry user fees. Just last year, we established a new 
generic drug user fee program to help get more of these products to 
patients more quickly. However, I have heard from a constituent that 
the generic drug establishment fee would put them out of business, and 
they had no time or idea they needed to plan for the over $170,000 bill 
they received in March.
    How can we work together to make sure that all parties that will be 
affected are involved in the user fee negotiations, and how can we 
ensure that in the first year of new user fee programs that adjustments 
can be made as necessary to protect small businesses from unintended 
consequences?
    Answer. FDA engaged in significant public outreach, including 
convening a number of public meetings with industry and other 
stakeholders, to discuss GDUFA and the progress of negotiations.
    A fee waiver was considered during negotiations and rejected 
because it would have diminished the number of companies required to 
pay the fees which, in turn, would have raised the fees for the fee-
paying companies. Unlike brand manufacturers, the majority of generic 
companies are small businesses.
    Furthermore, an exemption would have added to the administrative 
cost of the program by requiring additional staff to determine which 
companies met the exemption and handle disputes. This would have 
diverted user fee funds away from activities in support of meeting the 
goals contained in the user fee agreement, or would have required 
higher fees to accommodate the increased administrative complexity.
    Small and large generic companies alike are expected to benefit 
significantly from reductions in the review time needed to 
commercialize their products and from the certainty associated with 
GDUFA performance review metrics and program efficiencies.
    FDA does not have the current authority to create a fee waiver or 
reduction provision for small businesses.
    During the next round of generic drug user fee negotiations, FDA 
will again invite industry trade associations to participate in 
negotiations and hold open public meetings to provide a forum for 
industry, and other stakeholder input. All interested parties are 
encouraged to provide input.
    Question. In 2009, Congress passed the President enacted the Family 
Smoking Prevention and Tobacco Control Act, providing FDA broad 
authority to regulate tobacco products. I have a few questions on the 
implementation of this law.
    How did your department adjust and align FDA's new authority with 
the authority of other HHS agencies to reduce duplicative programs and 
target resources?
    Answer. FDA's responsibility with respect to tobacco control 
activities is to protect the public health by regulating the 
manufacture, distribution, and marketing of tobacco products, and 
educating Americans, especially young people, about tobacco products 
and their dangers. FDA works closely with other Federal public health 
agencies to ensure the various tobacco programs are coordinated and are 
not duplicative.
    The Tobacco Control Act authorizes FDA to collect quarterly fees 
from the tobacco industry. These fees are to be available only for the 
purposes of paying the costs of activities that support the regulatory 
mission of FDA-related to tobacco products. Furthermore, the Tobacco 
Control Act specifies that these tobacco user fees are the only funds 
authorized to be made available for FDA's tobacco regulation including 
research, compliance and enforcement, and science-based public 
education campaigns addressing the dangers of tobacco use.
    FDA has put a comprehensive financial stewardship plan in place to 
ensure that tobacco user fees only support its regulatory activities. 
Although many agencies and offices in HHS, including FDA, are working 
together to address the significant public health concerns created by 
the use of tobacco products, FDA does not, for example, provide direct 
cessation services or engage in community-based tobacco prevention 
activities, as some other HHS agencies do.
    Question. It is my understanding that there hasn't been a single 
product approved under this new law. Innovation will be necessary to 
reduce harm and give people who can't quit less risky alternatives. FDA 
focuses a lot on innovation, and how does that focus relate to the 
concept of tobacco-related harm reduction?
    Answer. To date, FDA has not received any new tobacco product 
applications and none of the modified risk tobacco product applications 
it has received have been accepted for filing. However, FDA has 
received over 3,000 ``provisional'' substantial equivalence (SE) 
reports for tobacco products introduced into interstate commerce 
between February 15, 2007, and March 22, 2011, for which a report was 
submitted prior to March 23, 2011. These provisional products can 
remain on the market unless FDA finds that they are ``not substantially 
equivalent.'' FDA has also received more than 500 ``regular'' SE 
reports for new products that manufacturers intend to introduce to 
market.
    FDA reviews all SE reports as expeditiously as possible and will 
continue to do so; however, FDA has observed deficiencies in nearly all 
initial SE reports reviewed to date from different tobacco product 
manufacturers. As the quality of reports improves and FDA gains more 
experience reviewing them, FDA expects both the review times and the 
backlog to decrease.
    With respect to innovation, tobacco companies have recently 
introduced newer forms of tobacco products. FDA is funding research to 
better understand these newer products with regard to their relative 
risks compared to other tobacco products. It is critically important to 
evaluate these products not only in terms of the relative health risks 
to individuals, but also to consider the likelihood that nonusers will 
start using the product, users who would otherwise stop using tobacco 
products will switch to the new product, tobacco users may use the new 
tobacco products in combination with other products, and former users 
will begin using the new product.
    The Modified Risk Tobacco Product provisions of the Tobacco Control 
Act may be valuable tools in the effort to protect public health by 
reducing the morbidity and mortality associated with tobacco use, 
particularly if tobacco product manufacturers can adequately 
demonstrate that product changes will substantially reduce, or even 
eliminate altogether, either the toxicity or addictiveness of tobacco 
products, or both.
    FDA is also funding research on reduced nicotine cigarettes, 
smokeless tobacco products, and the diversity of tobacco products 
including new and emerging tobacco products to inform the advancement 
of harm reduction at both the individual and population level.
                                 ______
                                 
              Questions Submitted by Senator Daniel Coats

    Question. Medical device manufactures, while supportive of unique 
device identifiers (UDIs), remain concerned regarding implementation of 
the Proposed UDI Rule. These concerns include the FDA requirement that 
UDIs be applied to products in their existing inventory, as well as the 
requirement that UDIs be applied directly onto each implantable 
product, otherwise known as Direct Part Marking (DPM). Many medical 
devices have a significant shelf life allowing for products to remain 
in inventory for longer periods of time. Additionally, some segments of 
the medical device industry utilize the consignment model, meaning that 
devices remain under company control and are not sold to the customer 
until they are used or implanted. This method is used to ensure 
patients have the most appropriate options. Should the Proposed UDI 
Rule apply to these products, device manufacturers would be forced to 
recall each device to apply a UDI, potentially interrupting patient 
care. Additionally, because the UDI should already be in the patient 
record at the time of implantation, there doesn't seem to be any 
additional utility to place it directly on an implantable device.
    Please describe what steps the FDA is taking to consider the 
effects this UDI rule may have on patient quality and choice, as well 
as the burden placed upon medical device manufacturers and customers.
    Answer. FDA has reviewed the comments submitted to the UDI proposed 
rule--including a significant number that addressed the existing 
inventory issue and the direct marking requirement for implants. 
Although FDA cannot discuss how it will address these comments while 
the rule remains in clearance, we wish to assure you that we take these 
concerns very seriously and note that FDA's goal is not to require 
device manufacturers to recall or re-label already finished medical 
devices. Requiring manufacturers to mark medical devices with unique 
identifiers will improve postmarket surveillance and patient safety. 
Device tracking will ensure more efficient device recalls by assisting 
manufacturers, providers, hospitals and patients with quicker 
identification and remediation of faulty devices. We believe that the 
final rule appropriately strikes a balance between the needs of 
patients, clinicians, the healthcare system, and FDA--and the concerns 
of the medical device industry.
    In addition, FDA is taking a number of steps to ensure that the UDI 
will support patient safety, quality and choice. FDA's Global Unique 
Device Identification Database (GUDID), which will contain a robust set 
of data for every device marked with a UDI, will be publicly available 
and will allow patients and clinicians to search for the appropriate 
device. In addition to our work with the medical device industry FDA is 
also working with numerous stakeholders, including the Brookings 
Institution, National Coordinator for Health Information Technology 
(ONC), Centers for Medicare and Medicaid Services (CMS), private 
payers, solution providers, hospitals and Integrated Delivery Networks 
(IDNS) on the adoption and implementation of UDI throughout the 
healthcare system and the lifecycle of medical devices.

                          SUBCOMMITTEE RECESS

    Senator Pryor. This subcommittee will meet again on 
Thursday, May 9 at 10 a.m. in this room, where we will have 
testimony from Secretary Vilsack regarding USDA fiscal year 
2014 budget.
    Again, I want to thank everyone for being here, and this 
hearing is recessed.
    Dr. Hamburg. Thank you.
    [Whereupon, at 11:46 a.m., Thursday, April 18, the 
subcommittee was recessed, to reconvene at 10 a.m., Thursday, 
May 9.]
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