[Congressional Record (Bound Edition), Volume 156 (2010), Part 15]
[Senate]
[Pages 22075-22078]
[From the U.S. Government Publishing Office, www.gpo.gov]




          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. SPECTER:
  S. 4032. A bill to amend the Controlled Substances Act to more 
effectively regulate anabolic steroids; to the Committee on the 
Judiciary.
  Mr. SPECTER. Mr. President, I have sought recognition to introduce 
the Designer Anabolic Steroid Control Act of 2010. This legislation was 
originally filed as an amendment, number 4693, to the FDA Food Safety 
Modernization Act S. 510, but did not receive a vote. Therefore, before 
the 111th Congress ends, I am introducing it as a stand-alone bill 
which may be taken up in another Congress.

[[Page 22076]]

  Anabolic steroids--masquerading as body building dietary 
supplements--are sold to millions of Americans in shopping malls and 
over the Internet even though these products put at grave risk the 
health and safety of Americans who use them. The harm from these 
steroid-tainted supplements is real. In its July 28, 2009 public health 
advisory, the FDA described the health risk of these types of products 
to include serious liver injury, stroke, kidney failure and pulmonary 
embolism. The FDA also warned:

       [A]anabolic steroids may cause other serious long-term 
     adverse health consequences in men, women, and children. 
     These include shrinkage of the testes and male infertility, 
     masculinization of women, breast enlargement in males, short 
     stature in children, adverse effects on blood lipid levels, 
     and increased risk of heart attack and stroke.

  New anabolic steroids--often called designer steroids--are coming on 
the market every day, and FDA and DEA are unable to keep pace and 
effectively stop these products from reaching consumers.
  At the Senate Judiciary Subcommittee on Crime and Drugs hearing I 
chaired on September 29, 2009, representatives from FDA and DEA, as 
well as the U.S. Anti-Doping Agency, testified that there is a cat and 
mouse game going on between unscrupulous supplement makers and law 
enforcement--with the bad actors engineering more and more new anabolic 
steroids by taking the known chemical formulas of anabolic steroids 
listed as controlled substances in Schedule III and then changing the 
chemical composition just slightly, perhaps by a molecule or two. These 
products are rapidly put on the market--in stores and over the 
Internet--without testing and proving the safety and efficacy of these 
new products. There is no pre-notification to, or pre-market approval 
by, federal agencies occurring here. These bad actors are able to sell 
and make millions in profits from their designer steroids because while 
it takes them only weeks to design a new steroid by tweaking a formula 
for a banned anabolic steroid, it takes literally years for DEA to have 
the new anabolic steroid classified as a controlled substance so DEA 
can police it.
  The FDA witness at the hearing, Mike Levy, Director of the Division 
of New Drugs and Labeling Compliance, acknowledged that this is a 
``challenging area'' for FDA. He testified that for FDA it is 
``difficult to find the violative products and difficult to act on 
these problems.'' The DEA witness, Joseph T. Rannazzisi, Deputy 
Assistant Administrator for DEA, was even blunter. When I questioned 
him at the hearing, Mr. Rannazzisi admitted that ``at the present time 
I don't think we are being effective at controlling these drugs.'' He 
described the process as ``extremely frustrating'' because ``by the 
time we get something to the point where it will be administratively 
scheduled [as a controlled substance], there's two to three [new] 
substances out there.''
  The failure of enforcement is caused by the complexity of the 
regulations, statutes and science. Either the Food Drug and Cosmetic 
Act, which provides jurisdiction for FDA, or the Controlled Substances 
Act, which provides jurisdiction for DEA, or both, can be applicable 
depending on the ingredients of the substance. Under a 1994 amendment 
to the Food Drug and Cosmetic Act, called the Dietary Supplement Health 
and Education Act, DSHEA, dietary supplements, unlike new drug 
applications, are not closely scrutinized and do not require Pre-market 
approval by the FDA before the products can be sold. Pre-market 
notification for dietary supplements is required only if the product 
contains new dietary ingredients, meaning products that were not on the 
U.S. market before DSHEA passed in 1994.
  If the FDA determines that a dietary supplement is a steroid, it has 
several enforcement measures available to use. FDA may treat the 
product as an unapproved new drug, or as an adulterated dietary 
supplement under the Food Drug and Cosmetic Act. Misdemeanor violations 
of the Food Drug and Cosmetic Act may apply, unless there is evidence 
of intent to defraud or mislead, a requirement for a felony charge. 
However, given the large number of dietary supplement products on the 
market, it is far beyond the manpower of the FDA to inspect every 
product to find, and take action against, those that violate the law--
as the FDA itself has acknowledged.
  The better enforcement route is a criminal prosecution under the 
Controlled Substances Act. However, the process to classify a new 
anabolic steroid as a controlled substance under Schedule III is 
difficult, costly and time consuming, requiring years to complete. 
Current law requires that to classify a substance as an anabolic 
steroid, DEA must demonstrate that the substance is both chemically and 
pharmacologically related to testosterone. The chemical analysis is the 
more straightforward procedure, as it requires the agency to conduct an 
analysis to determine the chemical structure of the new substance to 
see if it is related to testosterone. The pharmacological analysis, 
which must be outsourced, is more costly, difficult, and can take years 
to complete. It requires both in vitro and in vivo analyses, the latter 
is an animal study. DEA must then perform a comprehensive review of 
existing peer-reviewed literature.
  Even after DEA has completed the multi-year scientific evaluation 
process, the agency must embark on a lengthy regulatory review and 
public-comment process, which typically delays by another year or two 
the time it takes to bring a newly emerged anabolic steroid under 
control. As part of this latter process, DEA must conduct interagency 
reviews, which means sending the studies and reports to the Department 
of Justice, DOJ, the Office of Management and Budget, OMB, and the 
Department of Health and Human Services, HHS, provide public 
notification of the proposed rule, allow for a period of public 
comment, review and comment on all public comments, write a final rule 
explaining why the agency agreed or did not agree with the public 
comments, send the final rule and agency comments back to DOJ, OMB and 
HHS, and then publish the final rule, all in accordance with the 
Administrative Procedures Act. To date, under these cumbersome 
procedures, DEA has only been able to classify three new anabolic 
steroids as controlled substances and that process--completed only 
after the September 29, 2010 Senate Judiciary subcommittee hearing--
took more than 5 years to finish.
  It is clear that the current complex and cumbersome regulatory system 
has failed to protect consumers from underground chemists who easily 
and rapidly produce designer anabolic steroids by slightly changing the 
chemical composition of the anabolic steroids already included on 
Schedule III as controlled substances. The story of Jareem Gunter, a 
young college athlete who testified at the hearing, illustrates the 
system's failure. To improve his athletic performance four years ago, 
Jareem purchased in a nutrition store a dietary supplement called 
Superdrol, a product he researched extensively on the Internet and 
believed was safe. Unfortunately it was not. Superdrol contained an 
anabolic steroid which to this day is still not included in the list of 
controlled substances. After using Superdrol for just several weeks, 
Jareem came close to dying because this product--which he thought would 
make him stronger and healthier--seriously and permanently injured his 
liver. He spent four weeks in the hospital and has never been able to 
return to complete his college education.
  To close the loopholes in the present laws that allow the creation 
and easy distribution of deadly new anabolic steroids masquerading as 
dietary supplements, I am introducing today The Designer Anabolic 
Steroid Control Act of 2010. The bill simplifies the definition of 
anabolic steroid to more effectively target designer anabolic steroids, 
and permits the Attorney General to issue faster temporary and 
permanent orders adding recently emerged anabolic steroids to the list 
of anabolic steroids in Schedule III of the Controlled Substances Act.
  Under the bill, if a substance is not listed in Schedule III of the 
Controlled Substances Act but has a chemical

[[Page 22077]]

structure substantially similar to one of the already listed and banned 
anabolic steroids, the new substance will be considered to be an 
anabolic steroid if it was intended to affect the structure or function 
of the body like the banned anabolic steroids do. In other words, DEA 
will not have to perform the complex and time consuming pharmacological 
analysis to determine how the substance will affect the structure and 
function of the body, as long as the agency can demonstrate that the 
new steroid was created or manufactured for the purpose of promoting 
muscle growth or causing the same pharmacological effects as 
testosterone.
  Utilizing the same criteria, the bill permits the Attorney General to 
issue a permanent order adding such substances to the list of anabolic 
steroids in Schedule III of the Controlled Substances Act.
  The bill also includes new criminal and civil penalties for falsely 
labeling substances that are actually anabolic steroids. The penalties 
arise where a supplement maker fails to truthfully indicate on the 
label--using internationally accepted and understandable terminology--
that the product contains an anabolic steroid. These penalties are 
intended to be substantial enough to take away the financial incentive 
of unscrupulous manufacturers, distributors, and retailers who might 
otherwise be willing to package these products in a way that hides the 
true contents from law enforcement and consumers.
  Finally, the bill adds 33 new anabolic steroids to Schedule III. 
These 33 anabolic steroids have emerged in the marketplace in the six 
years since Congress passed the Anabolic Steroid Control Act of 2004. 
The bill also instructs the United States Sentencing Commission to 
review and revise the Federal sentencing guidelines to ensure that 
sentences will be based on the total weight of the product when 
anabolic steroids are illegally manufactured or distributed in a 
tablet, capsule, liquid or other form that makes it difficult to 
determine the actual amount of anabolic steroid in the product.
  By making these changes, we can protect the health and lives of 
countless Americans and provide an effective enforcement mechanism to 
hold accountable those individuals and their companies which 
purposefully exploit the current regulatory system for their selfish 
gain. The Department of Justice has provided extensive technical 
assistance in the drafting of this bill over many months. In addition, 
this legislation is fully supported by the United States Olympic 
Committee, the National Football League, the United States Anti-Doping 
Agency, as well as by Supplement Safety Now, a coalition including all 
the major league sports teams, and other sports and medical 
associations. I urge my colleagues to take up this much-needed bill in 
the next Congress.
                                 ______
                                 
      By Mr. SPECTER:
  S. 4033. A bill to provide for the restoration of legal rights for 
claimants under holocaust-era insurance policies; to the Committee on 
the Judiciary.
  Mr. SPECTER. Mr. President, I have sought recognition to urge my 
colleagues to support and take up next Congress the bill I just 
introduced, the Restoration of Legal Rights for Claimants Under 
Holocaust-Era Insurance Policies. The bill would restore the right of 
Holocaust survivors and their descendants--many of them United States 
citizens--to maintain lawsuits in our courts to recover unpaid proceeds 
under Holocaust-era life insurance policies. Recent decisions of the 
federal courts about which I have spoken at length in prior floor 
statements and confirmation hearings have denied survivors and their 
descendants that right.
  The insurance policies at issue were issued to millions of European 
Jews before World War II. During the Nazi era, European insurers 
largely escaped their obligations under the policies--sometimes by 
participating with the Nazis in what one Supreme Court Justice has 
characterized as ``larcenous takings of gigantic proportions.'' [Am. 
Ins. Ass'n v. Garamendi, 539 U.S. 396, 430 (2003) (Ginsburg, J., joined 
by Stevens, Scalia, and Thomas, JJ., dissenting).] In the aftermath of 
World War II, insurers dishonored the policies for one shameful reason 
or another. The most shameful of them was that a claimant could not 
produce a death certificate of a deceased insured who had been murdered 
in a Nazi death camp.
  In the 1990s survivors turned, as a last resort, to the courts of the 
United States. Numerous suits were filed seeking compensation from 
European insurers for dishonoring Holocaust-era insurance policies 
during and especially after the War. Several States, for their part, 
attempted to facilitate recovery under unpaid policies by requiring 
insurers doing business in their States, as most did, to disclose 
information about those policies.
  European insures responded to these developments by agreeing to 
establish a private claims resolution process. Their agreement resulted 
in the establishment of a voluntary organization in 1998--formed by, 
among others, the insurers, the State of Israel, and State insurance 
commissioners in the United States known as the International 
Commission on Holocaust Era Insurance Claims, ICHEIC. ``The job of 
ICHEIC,'' according to the Supreme Court, ``include[d] negotiation with 
European insurers to provide information about unpaid insurance 
policies and the settlement of claims under them.'' [Garamendi, 539 
U.S. at 407.]
  Many survivors and their descendants filed claims through ICHEIC. How 
fairly ICHEIC decided their claims remains a debated question. 
Testimony before Congress at least raises serious questions as to 
whether meritorious claims were denied. I do not wish to enter that 
debate today except to emphasize that ICHEIC was not a neutral, 
governmental adjudicatory body. It was, as then-Judge Michael Mukasey 
said, a ``an ad-hoc non-judicial, private international claims 
tribunal'' created, funded, and to a large extent controlled by the 
insurance companies--in short, again in Judge Mukasey's words, ``a 
company store.'' [In re Assicurazioni Generali, S.p.A Holocaust Ins. 
Litig., 228 F. Supp. 2d 348, 356-57 (S.D.N.Y. 2002).] I also wish to 
emphasize that by filing a claim through ICHEIC, a claimant did not 
waive his right to file suit. Only claimants who received payments 
under insurance policies did so.
  Despite the creation of ICHEIC, litigation continued in American 
courts. Foreign protests over the litigation led the United States to 
negotiate several executive agreements with foreign governments. Of 
these, the most important was the 2000 German Foundation Agreement. It 
obligated Germany to establish the German Foundation, which was funded 
by Germany and German companies, to compensate Jews ``who suffered'' 
various economic harms ``at the hands of the German companies during 
the National Socialist era.'' As for insurance claims in particular, 
the agreement obligated German insurers to address them through ICHEIC. 
Similar agreements between the United States and Austria and France 
followed. No agreement was reached, though, with Nazi German's 
principal ally, Italy.
  In negotiating the 2000 agreement, Germany sought immunity from 
suit--``legal peace'' as Germany calls it--in American courts for 
German companies. The United States refused to provide it, and could 
not have provided it, in my view, in the absence of a Senate-ratified 
treaty or some other such authoritative Congressional action. Instead 
the United States agreed only to the inclusion of a provision 
obligating the United States to file in any suit against a German 
company over a Holocaust-era claim a precatory statement informing the 
court that ``it would be in the foreign policy interests of the United 
States for the Foundation to be the exclusive forum and remedy for the 
resolution of all asserted claims against Germany companies arising 
from their involvement in the National Socialist era and World War 
II.'' The United States also agreed in any such filing to ``recommend 
dismissal on any valid legal ground (which, under the U.S. system of 
jurisprudence, will be for the U.S. courts to determine).'' The 2000 
agreement makes explicit, however, that ``the

[[Page 22078]]

United States does not suggest that its policy interests concerning the 
Foundation in themselves provide an independent legal basis for 
dismissal.''
  But what the 2000 executive agreement expressly denied Germany 
companies--that is, immunity from suit--our federal courts have now 
given them at the urging of the executive branch. I refer first and 
foremost to the Supreme Court's much-criticized, five-to-four decision 
in American Insurance Co. v. Garamendi, 2003. The Court held there that 
the executive branch's foreign policy favoring the resolution of 
Holocaust-era insurance claims through ICHEIC preempted a California 
law requiring the disclosure of information about Holocaust-era 
insurance policies to potential claimants. It did not matter, the Court 
said, that the executive agreement said nothing whatsoever about 
preemption, let alone that no federal statute or treaty actually 
preempted disclosure statute's like California's. It was enough that 
the agreement embodied a general policy--reaffirmed over the years by 
statements by sub-cabinet officials--with which California's disclosure 
state could be said to conflict. Four Justices with very different 
views on executive power--Ginsburg, Scalia, Stevens, and Thomas--
dissented. While conceding the, questionable, argument that the 
President can under some circumstances preempt state law by executive 
agreement, they emphasized the obvious flaw in the Court's position on 
the facts at hand: The 2000 agreement says nothing about preemption. 
Insofar as it says anything on the subject, it actually disclaims any 
preemptive effect.
  On the authority of Garamendi, the Federal district court before 
which lawsuits to recover on policies issued by the Italian insurer 
Generali had been consolidated dismissed those suits as preempted. The 
court rejected the plaintiffs' argument that the suits could not be 
preempted because Italy and the United States had never entered into an 
executive agreement addressing claims against Italian insurers. Appeals 
to the Court of Appeals for the Second Circuit followed. While the 
appeals were pending, a class action settlement was reached and 
approved by the court under which most of the class members received 
nothing. The plaintiffs' lead counsel has said that Garamendi left them 
no choice but to settle. Several plaintiffs who opted out of the 
settlement nonetheless pressed on with the appeals. Early this year the 
Second Circuit affirmed the dismissal of their cases. [In re 
Assicurazioni Generali, S.P.A., 529 F.3d 113 (2d Cir. 2010).]
  The plaintiffs then asked the Supreme Court to hear their case by 
filing a petition for certiorari. They raised two main questions. 
Whether Garamendi preempts the generally applicable state common law 
under which the plaintiffs sought recovery, as opposed to the 
disclosure-specific law California enacted. Whether Garamendi should be 
read to preempt state-law claims in the absence of any executive 
agreement addressing those claims. Recall that Italy and the United 
States never entered into an executive agreement with which claims 
against Generali, an Italian insurer, could be said to conflict. A 
post-Garamendi decision of the Court, Medellin v. Texas, 2008, suggests 
that Garamendi cannot be so broadly read--that an executive-branch 
foreign policy can preempt state law only if it becomes law through the 
means prescribed by the Constitution or, in some limited class of cases 
at least, find expression in an executive agreement entered with 
Congress's acquiescence. Despite the importance of these questions and 
an apparent split among the lower courts in answering them, the Supreme 
Court denied certiorari.
  My legislation would achieve two narrow, but important, objectives: 
First, it would restore Holocaust survivors and their descendants to 
the legal position they occupied before Garamendi and Generali. Second, 
it would allow states to enforce the sort of disclosure laws at issue 
in Garamendi. With limited exceptions tailored to achieve these 
objectives, the legislation would otherwise leave undisturbed any 
defenses that insurers may have to Holocaust-era insurance claims, 
including the defense that they were settled and released through 
ICHEIC.
  Of equal significance, my legislation would vindicate two important 
Constitutional principles--one involving separation of powers, the 
other federalism. The principle of separation of powers is that the 
Constitution vests all lawmaking authority in Congress and none in the 
executive branch. The principle of federalism is that, under the 
Constitution's supremacy clause, Article VI, only the Constitution, 
Congressionally enacted law, and Senate-ratified treaties can preempt 
state law. Some executive agreements, if entered at least with 
Congress's acquiescence, arguably may also do so. But executive-branch 
policies plainly do not.
  One final point: A similar House bill, H.R. 4596, has been objected 
to on the ground that it will disserve aging Holocaust survivors 
because it will create unrealistic expectations of recovery. Claims 
that were not successful before ICHEIC, the House bill's critics claim, 
are almost certain to fail in court. That is a debatable objection. It 
is, in any event, beside the point. Holocaust survivors and their 
descendants should be allowed to decide for themselves whether to file 
suit. Neither the executive branch nor the federal courts should make 
that decision for them.

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