[Federal Register Volume 60, Number 115 (Thursday, June 15, 1995)]
[Notices]
[Pages 31485-31487]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-14587]



[[Page 31485]]

DEPARTMENT OF HEALTH AND HUMAN SERVICES

[Docket No. 94D-0123]


International Memoranda of Understanding; New Compliance Policy 
Guide; Availability

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Food and Drug Administration (FDA) is announcing a new 
Compliance Policy Guide (CPG) 7150.19 entitled ``International 
Memoranda of Understanding.'' The text of the CPG is published in this 
document. The guide sets forth policy for initiating, developing, and 
monitoring agreements such as memoranda of understanding (MOU's) 
between FDA and foreign governments.

ADDRESSES: CPG 7150.19 is available for public examination in the 
Dockets Management Branch (HFA-305), Food and Drug Administration, rm. 
1-23, 12420 Parklawn Dr., Rockville, MD 20857, between 9 a.m. and 4 
p.m., Monday through Friday.

FOR FURTHER INFORMATION CONTACT:  Richard M. Garwood, Office of 
Regulatory Affairs (HFC-10), Food and Drug Administration, 5600 Fishers 
Lane, Rockville, MD 20857, 301-443-2175.

SUPPLEMENTARY INFORMATION: The FDA International Harmonization Task 
Force recommended in December 1992 that guidance be developed that 
describes the agency's objectives, and promotes uniformity, in 
developing MOU's with foreign government agencies or with international 
organizations. MOU's enhance FDA's ability to carry out its mission and 
promote harmonization of laws and regulations, compliance activities, 
and enforcement actions. Harmonization facilitates the efficient and 
effective execution of FDA's programs and promotes international trade.
    It is the policy of FDA to pursue the development of MOU's that 
will further the agency's domestic public health mission. MOU's between 
FDA and an agency of a foreign government or an international 
organization should be designed to:
    (1) Enhance FDA's ability to ensure that regulated products are 
safe, effective, of good quality, and properly labeled;
    (2) Allow FDA to utilize its resources more effectively or 
efficiently, without compromising its ability to carry out its 
responsibilities; and
    (3) Improve communications between FDA and foreign officials 
concerning FDA-regulated products.
    This policy is detailed in the new CPG 7150.19, entitled 
``International Memoranda of Understanding,'' the text of which is 
provided below. FDA MOU's are negotiated in accordance with the 
Department of State's Circular 175 procedures.
    In order to facilitate future reorganization of the CPG manual 
system, the entire contents of CPG 7150.19 will be duplicated, assigned 
a second number, 7156.00, and carried in a second location in the CPG 
manual system. This fact will be cross-referenced and notated in the 
CPG manual system.
    The text of CPG 7150.19 entitled ``International Memoranda of 
Understanding'' follows:

Compliance Policy Guide, Food and Drug Administration, International 
Memoranda of Understanding

SUBJECT:

    This guide sets forth policy for initiating, developing, and 
monitoring agreements such as memoranda of understanding (MOU's) 
between the Food and Drug Administration (FDA) and foreign 
governments. The general principles herein may also be applicable to 
MOU's with international organizations.

BACKGROUND:

    The FDA International Harmonization Task Force recommended in 
December 1992 that guidance be developed that describes the agency's 
objectives and promotes uniformity in developing MOU's with foreign 
government agencies. MOU's promote harmonization of laws, 
regulations, and enforcement activities. Further, MOU's, if 
negotiated and implemented properly, enhance FDA's ability to carry 
out its mission. Attachment A to this Compliance Policy Guide (CPG) 
sets forth the agency's criteria for setting priorities for 
international MOU's.
    The three categories of MOU's described in the following 
paragraphs are merely examples. These categories are not mutually 
exclusive, and the concepts may be altered or combined as necessary. 
Because officials of sovereign nations have different approaches to 
regulation, FDA needs to maintain flexibility in its discussions 
with these officials.

Reciprocal Agreements with Countries Having the Same or Similar 
Systems

    MOU's may provide for the mutual assessment of the comparability 
of specific FDA programs or activities with those of a foreign 
regulatory authority. These MOU's are similar to mutual recognition 
agreements (MRA's), referred to in recent trade agreements, and 
include equivalence agreements. FDA MOU's that provide for the 
mutual assessment of the comparability of a foreign regulatory 
system or measure are suitable when it can be determined that FDA's 
controls and the foreign regulatory authority's controls are 
comparable and are designed to provide the same level of protection. 
Under one form of such agreements, mutual acceptance of data and 
information, such as analytical findings and inspection results, may 
ordinarily be considered adequate for regulatory decisions. The 
MOU's now in place for the exchange of results of good manufacturing 
practices and good laboratory practices inspections are examples. 
Under another form of such agreements, FDA and another country may 
agree that their regulatory systems governing certain products are 
the same or similar and are designed to provide the needed level of 
protection, enabling each country to consider reducing the rate of 
inspection or sampling of imports from the other country that would 
otherwise be necessary.

Certification of Import/Exports

    MOU's may establish certification criteria for products 
regulated by FDA. Historically, these MOU's have concerned products 
exported to the United States with inherent or consistent quality or 
safety problems. However, they may also involve products with a good 
compliance history (see Attachment A of this CPG). They may identify 
controls to be employed by the exporting country to assure the 
validity and reliability of certification. Such agreements should be 
designed with the intent of reducing the FDA rate of inspection or 
sampling that would otherwise be necessary and with the intent of 
providing a basis for assurance that the consumer protection 
objectives of FDA are being met. Certification may be shown by marks 
on the product, container, or entry documents or by other paper or 
electronic communication. An MOU based on the controls to be 
employed and maintained by the exporting country to ensure that 
articles exported comply with FDA laws and regulations may render 
such certifying marks, documents, or other communication 
unnecessary.

Communications

    Formalizing communication links facilitates the exchange of 
technical, scientific, and regulatory information. Technical 
cooperation leads to better understanding of safety and quality 
standards for products traded between the United States and other 
countries and promotes harmonization. Improved communications with 
foreign officials may improve FDA decisionmaking and reduce resource 
expenditures for monitoring foreign made products.

POLICY:

    It is the policy of FDA to pursue the development of MOU's that 
will further the agency's public health mission. FDA intends to 
enter into an MOU only with an agency of a foreign government or an 
international organization. The MOU should be designed to meet the 
following goals:
    (1) To enhance FDA's ability to ensure that regulated products 
are safe, effective, of good quality, and properly labeled;
    (2) To allow FDA to utilize its resources more effectively or 
efficiently, without compromising its ability to carry out its 
responsibilities; and
    (3) To improve communications between FDA and foreign officials 
concerning FDA regulated products. [[Page 31486]] 
    Further, before accepting the procedures and activities, 
including enforcement methods, of foreign governments as equivalent 
to its own, FDA will seek assurance that such activities provide the 
same level of product quality, safety and efficacy that is provided 
under the Federal Food, Drug, and Cosmetic Act (the act); the Fair 
Packaging and Labeling Act; the Public Health Service Act; and any 
other relevant law of the United States. FDA may find it necessary 
to confirm by on-site review or other appropriate means that the 
foreign government agency has the necessary authorities, product 
standards, capabilities, and infrastructure to successfully achieve 
the proposed terms of the MOU, and, therefore, that a determination 
of equivalence can be made. Where appropriate, FDA will publish a 
proposed equivalence determination for comment.
    FDA's criteria for deciding when to initiate consideration of 
developing MOU's are set forth in Attachment A of this CPG. FDA 
intends to review and update these criteria periodically.
    Affected agency units will review the proposal for a new or 
revised MOU for consistency with the agency's international policy 
objectives and priorities before an FDA component begins substantive 
discussions with foreign officials about the MOU.
    FDA auditing may be necessary to assure that the circumstances 
supporting the basis for an agreement continue to exist, whether or 
not the foreign government intends to conduct audits. The liaison 
office identified in the MOU is responsible for preparing a written 
evaluation. Participating FDA components will be queried by the 
responsible liaison office as to the overall effectiveness of the 
agreement, whether provisions should be added or deleted, and 
whether the MOU should be terminated.
    Countersigned agreements are commonly referred to by FDA as 
``Memoranda of Understanding.'' However, some foreign governments 
have requested that such documents be titled as ``Notes Verbale,'' 
``Arrangements,'' or ``Mutual Recognition Agreements.'' Regardless 
of title, such agreements will be filed in chapter 56 of the 
Compliance Policy Guides Manual, and a notice of availability will 
be published in the Federal Register.
    An ``exchange of letters'' should be used in lieu of a formal 
agreement when the actions contemplated require only a limited 
resource expenditure and do not rise to the significance of a formal 
agreement. For example, an exchange of letters could formalize an 
understanding that each agency will provide the other with documents 
that are available upon request to any member of the public. Each 
letter should set out only the actions to be carried out by the 
agency signing the letter and not mutual considerations. Clearance 
of exchange of letters will be by the same process as used for MOU's 
except that, after clearance, the FDA letter may be signed by the 
appropriate Center or Office Director. Copies of the letters 
exchanged should be placed in the cooperative agreements portion of 
the Compliance Policy Guide Manual.
    FDA's practice is to enter into MOU's for a period of 5 years. 
Each existing MOU should be evaluated at least once during the 5 
year period of the agreement to determine whether the MOU should be 
modified, continued, or canceled. As part of the evaluation of an 
MOU, the agency may conduct independent or joint inspections or 
analyze imported products to evaluate the effectiveness of the MOU.

DEVELOPMENT GUIDANCE:

    Developing an MOU with a foreign government requires 
coordination between the sponsoring center or office, the Office of 
Regulatory Affairs (ORA), the International Affairs Staff/Office of 
Health Affairs (IAS/OHA), and the Office of Policy (OP). Generally, 
there are three phases in the process as described below:

Stage I--Exploring Feasibility

    a. The sponsoring Center or Office makes a preliminary 
assessment whether the proposed MOU is in line with FDA policy 
goals. If the sponsoring Center or Office believes that the MOU 
should be pursued, the Center or Office informs ORA (HFC-10) in 
writing and explain why it believes that the MOU should be pursued.
    b. The initiating agency component provides a general 
description of the agreement it wishes to develop, e.g., mutual 
recognition of a quality assurance program, product certification, 
information exchange, etc.
    c. The parties exchange information on laws, standards, and 
other requirements for subject products, inspection and sampling 
abilities, and analytical methodology, as appropriate.
    d. On-site review of facilities, operations, and controls may be 
arranged.
    e. If the foreign government appears not to be, and in FDA's 
opinion is not, capable of developing an adequate infrastructure to 
carry out the intended program, the sponsoring agency component will 
explain FDA's position in writing and suspend further action until 
FDA's concerns are adequately addressed. The letter addressing this 
issue should be reviewed by OP and IAS/OHA.

Stage II--Determining Effectiveness

    a. If discussions are to continue, IAS/OHA should be notified so 
that appropriate notification to the Department of State (DOS) can 
be made.
    b. The parties may consider an informal trial to gain confidence 
in the planned agreement. A draft MOU may be prepared along with a 
protocol that may provide a basis for the trial. Together these 
documents may include:
    (1) A complete description of the trial program.
    (2) Information regarding roles and capabilities of involved 
government and private organizations.
    (3) Certificate issuance and use procedure, if any.
    (4) Audit frequency and measures to be applied.
    (5) Description of training or information needs.
    c. Whether or not there is a trial, FDA may conduct as 
appropriate independent or joint inspections with the foreign 
government, or analyze imported products to evaluate the 
effectiveness of the program.

Stage III--Finalizing an MOU

    a. The MOU should be prepared for clearance after the substance 
of the MOU has been finalized, including after rulemaking, where 
appropriate.
    b. If appropriate, instructions for auditing the agreement 
should be issued to field offices by the sponsoring center or 
office, through ORA.

Attachment A

Food and Drug Administration Criteria for Memoranda of Understanding

    In deciding whether to begin discussions that could lead to the 
development of an MOU, an agency component should consider the 
factors that are listed below.

Health Benefits (Including Risk Reduction) Associated With Products 
or Programs

    FDA should consider the benefits to public health (particularly 
for the United States population) when it sets priorities for its 
international activities.

Products Imported into the United States

    FDA should place a higher priority on international activities 
that are directed toward improving the quality, safety, or efficacy 
of products offered to consumers in the United States. For example, 
FDA should give a low priority to investing resources in developing 
a memorandum of understanding with a foreign country that covers a 
product where there is little likelihood of significant exports to 
the United States or significant risk to the public.

History of Compliance Problems

    FDA should place a higher priority on international activities 
directed toward remedying product defects that have been 
demonstrated to be previous compliance problems or where there is a 
demonstrated scientific basis for increased surveillance.

Comparative Costs of Alternative Programs

    FDA should pursue international programs and activities that 
provide the greatest benefit in relation to the resources required 
to administer them. For example, the costs of developing, 
implementing, and monitoring an agreement should be weighed against 
the costs of higher sampling levels to obtain the same degree of 
confidence in rates of compliance in the absence of an agreement.

Regulatory Burden on Industry

    FDA should consider the regulatory burden on industry that could 
be diminished by harmonization efforts. However, these activities 
need to be compatible with FDA's primary public health mission, the 
act, and other laws and regulations that FDA enforces.

U.S. Foreign Policy Objectives and Priorities of Other U.S. 
Government Agencies

    FDA should be knowledgeable of U.S. foreign policy objectives 
and international programs and policies of other U.S. Government 
agencies and appropriately [[Page 31487]] balance these interests 
with those of FDA's primary mission.
    The statements made herein are not intended to bind the courts, 
the public, or FDA, or to create or confer any rights, privileges, 
immunities, or benefits on or for any private person, but are 
intended merely for internal FDA guidance.

    Dated: June 7, 1995.
William B. Schultz,
Deputy Commissioner for Policy.
[FR Doc. 95-14587 Filed 6-14-95; 8:45 am]
BILLING CODE 4160-01-F