[Federal Register Volume 63, Number 188 (Tuesday, September 29, 1998)]
[Rules and Regulations]
[Pages 51825-51827]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-25796]


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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 807

[Docket No. 98N-0520]


Medical Devices; Establishment Registration and Device Listing 
for Manufacturers and Distributors of Devices

AGENCY: Food and Drug Administration, HHS.

ACTION: Direct final rule.

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

SUMMARY: The Food and Drug Administration (FDA) is amending certain 
regulations governing establishment registration and device listing by 
domestic distributors. These amendments are being made to implement 
revisions to the Federal Food, Drug, and Cosmetic Act (the act), as 
amended by the Food and Drug Modernization Act of 1997 (FDAMA). 
Elsewhere in this issue of the Federal Register, FDA is publishing a 
companion proposed rule, under FDA's usual procedures for notice and 
comment, to provide a procedural framework to finalize the rule in the 
event the agency receives any significant adverse comment and withdraws 
the direct final rule.

DATES: The regulation is effective February 11, 1999. Submit written 
comments on or before December 14, 1998. If FDA receives no significant 
adverse comments within the specified comment period, the agency 
intends to publish a document confirming the effective date of the 
final rule in the Federal Register within 30 days after the comment 
period on this direct final rule ends. If FDA receives any significant 
adverse comment, FDA intends to withdraw this final rule by publication 
of a document in the Federal Register within 30 days after the comment 
period ends. These provisions of FDAMA became effective on February 19, 
1998.

ADDRESSES: Submit written comments on the direct final rule to the 
Dockets Management Branch (HFA-305), Food and Drug Administration, 5630 
Fishers Lane, rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Walter W. Morgenstern, Center for 
Devices and Radiological Health (HFZ-305), Food and Drug 
Administration, 2094 Gaither Rd., Rockville, MD 20857, 301-594-4699.

SUPPLEMENTARY INFORMATION:

I. Background

    On November 21, 1997, the President signed FDAMA into law (Pub. L. 
105-115). Section 213(b) of FDAMA made the following changes to section 
510(g) of the act (21 U.S.C. 360(g)) regarding domestic distributor 
registration and device listing:
    1. FDAMA amended section 510(g) of the act to add a new paragraph 
(g)(4) to provide that the registration and listing requirements of 
section 510 of the act do not apply to distributors who act as 
``wholesale distributor,'' and who do not manufacture, repackage, 
process, or relabel a device.
    2. FDAMA also added a definition of ``wholesale distributor'' to 
section 510(g) of the act. A ``wholesale distributor'' is defined as 
``any person (other than the manufacturer or the initial importer) who 
distributes a device from the original place of manufacture to the 
person who makes the final delivery or sale of the device to the 
ultimate consumer or user.''
     Section 213 of FDAMA became effective on February 19, 1998, and 
FDA is implementing the statute as of that date. FDA is issuing this 
direct final rule to amend certain existing regulations to conform to 
amendments made by FDAMA to section 510(g) of the act.

II. Amendment Highlights

    Section 807.3 (21 CFR 807.3) has been amended to incorporate the 
new definitions of distributor and wholesale distributor provided in 
amended section 510(g) of the act.
    FDA is also amending Sec. 807.3(g) to add a definition for 
``initial importer,'' because ``initial importer'' is excluded from the 
definition of wholesale distributor established by FDAMA.
    Sections 807.20 and 807.22 (21 CFR 807.20 and 807.22) have been 
amended to implement the changes made by FDAMA to section 510(g) of the 
act. These amendments to 21 CFR part 807 exempt distributors of 
domestic or imported devices from the requirement of establishment 
registration and device listing. Section 807.20 is further amended to 
clarify that initial importers of devices continue to be subject to 
registration and listing.
    Sections 807.3, 807.20, and 807.22 have been amended to conform the 
activities requiring registration with the changes made by FDAMA. Prior 
to FDAMA, all distributors were required to register and list. Amended 
section 510(g) of the act exempts wholesale distributors from 
registration and listing and defines a ``wholesale distributor'' as any 
person, other than the manufacturer or initial importer, who 
distributes a device from the original place of manufacture to the 
person who makes the final delivery or sale of the device to the 
ultimate consumer or user. The amendments to Secs. 807.3, 807.20, and 
807.22 reflect the changes made by FDAMA.

III. Rulemaking Action

    In the Federal Register of November 21, 1997 (62 FR 62466), FDA 
described when and how it will employ direct final rulemaking. FDA 
believes that this rule is appropriate for direct final rulemaking 
because FDA views this rule as making noncontroversial amendments to an 
existing regulation. The rule incorporates amendments to section 510(g) 
of the act made by FDAMA and FDA anticipates no significant adverse 
comment. Consistent with FDA's procedures on direct final rulemaking, 
FDA is publishing, elsewhere in this issue of the Federal Register, a 
companion proposed rule to amend certain existing regulations governing 
establishment registration and device listing by domestic distributors. 
The companion proposed rule is substantively identical to the direct 
final rule. The companion proposed rule provides a procedural framework 
within which the rule may be finalized in the event the direct final 
rule is withdrawn because of any significant adverse comment. The 
comment period for the direct final rule runs concurrently with the 
comment period of the companion proposed rule. Any comments received 
under the companion proposed rule will be considered as comments 
regarding the direct final rule.
    FDA is providing a comment period on the direct final rule of 
December 14, 1998. If the agency receives any significant adverse 
comment, FDA intends to withdraw this final rule by publication of a 
document in the Federal Register within 30 days after the comment 
period ends. A significant adverse comment is defined as a comment that 
explains why the rule would be inappropriate, including challenges to 
the rule's underlying premise or approach, or would be ineffective or 
unacceptable without change. In determining whether a significant 
adverse comment is sufficient to terminate a direct final rulemaking, 
FDA will consider whether the comment raises an issue serious enough to 
warrant a substantive response in a notice-and-comment

[[Page 51826]]

process. Comments that are frivolous, insubstantial, or outside the 
scope of the rule will not be considered significant or adverse under 
this procedure. For example, a comment recommending an additional 
change to the rule will not be considered a significant adverse 
comment, unless the comment states why the rule would be ineffective 
without the additional change. In addition, if a significant adverse 
comment applies to part of a rule and that part can be severed from the 
remainder of the rule, FDA may adopt as final those parts of the rule 
that are not the subject of a significant adverse comment.
    If FDA withdraws the direct final rule, all comments received will 
be considered under the companion proposed rule in developing a final 
rule under the usual notice-and-comment procedures under the 
Administrative Procedure Act (5 U.S.C. 552 et seq.). If FDA receives no 
significant adverse comment during the specified comment period, FDA 
intends to publish a confirmation document in the Federal Register 
within 30 days after the comment period ends. FDA intends to make the 
direct final rule effective February 11, 1999.

IV. Environmental Impact

    The agency has determined under 21 CFR 25.30(h) that this action is 
of a type that does not individually or cumulatively have a significant 
effect on the human environment. Therefore, neither an environmental 
assessment nor an environmental impact statement is required.

V. Analysis of Impacts

    FDA has examined the impact of this direct final rule under 
Executive Order 12866 and the Regulatory Flexibility Act (5 U.S.C. 601-
612) (as amended by subtitle D of the Small Business Regulatory 
Fairness Act of 1996 (Pub. L. 104-121)), and the Unfunded Mandates 
Reform Act of 1995 (Pub. L. 104-4). Executive Order 12866 directs 
agencies to assess all costs and benefits of available regulatory 
alternatives and, when regulatory action is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity). The agency believes that 
this direct final rule is consistent with the regulatory philosophy and 
principles identified in the Executive Order. In addition, this direct 
final rule is not a significant regulatory action as defined by the 
Executive Order and so is not subject to review under the Executive 
Order.
    The Regulatory Flexibility Act requires agencies to analyze 
regulatory options that would minimize any significant impact of a rule 
on small entities. The rule codifies applicable statutory requirements 
imposed by FDAMA. Because the rule exempts certain distributors from 
registration and device listing, it may permit more small competitors 
to enter the marketplace. The agency certifies that this direct final 
rule will not have a significant economic impact on a substantial 
number of small entities. This direct final rule also does not trigger 
the requirement for a written statement under section 202(a) of the 
Unfunded Mandates Reform Act because it does not impose a mandate that 
results in an expenditure of $100 million or more by State, local, or 
tribal governments in the aggregate, or by the private sector, in any 1 
year.

VI. Paperwork Reduction Act of 1995

    This direct final rule contains no collections of information. 
Therefore, clearance by the Office of Management and Budget under the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) is not required.

 VII. Submission of Comments

    Interested persons may, on or before December 14, 1998, submit to 
the Dockets Management Branch (address above) written comments 
regarding this rule. This comment period runs concurrently with the 
comment period for the companion proposed rule. Two copies of any 
comment are to be submitted, except that individuals may submit one 
copy. Comments are to be identified with the docket number found in the 
brackets in the heading of this document. Received comments may be seen 
in the office above between 9 a.m. and 4 p.m., Monday through Friday. 
All comments received will be considered comments regarding the 
proposed rule and this direct final rule. In the event the direct final 
rule is withdrawn, all comments received regarding the companion 
proposed rule and the direct final rule will be considered comments on 
the proposed rule.

List of Subjects in 21 CFR Part 807

    Confidential business information, Imports, Medical devices, 
Reporting and recordkeeping requirements.
    Therefore, under the Federal Food, Drug, and Cosmetic Act, and 
under authority delegated to the Commissioner of Food and Drugs, 21 CFR 
part 807 is amended as follows:
    1. The part heading for part 807 is revised to read as follows:

PART 807--ESTABLISHMENT REGISTRATION AND DEVICE LISTING FOR 
MANUFACTURERS AND INITIAL IMPORTERS OF DEVICES

    2. The authority citation for 21 CFR part 807 continues to read as 
follows:

    Authority: 21 U.S.C. 331, 351, 352, 360, 360c, 360e, 360i, 360j, 
371, 374.

    3. Section 807.3 is amended by revising paragraphs (d)(2) and (g), 
and by adding paragraph (s) to read as follows:

Sec. 807.3  Definitions.

* * * * *
    (d) * * *
    (2) Initial importation of devices manufactured in foreign 
establishments; or
* * * * *
    (g) Initial importer means any importer who furthers the marketing 
of a device from a foreign manufacturer to the person who makes the 
final delivery or sale of the device to the ultimate consumer or user, 
but does not repackage, or otherwise change the container, wrapper, or 
labeling of the device or device package.
* * * * *
    (s) Wholesale distributor means any person (other than the 
manufacturer or the initial importer) who distributes a device from the 
original place of manufacture to the person who makes the final 
delivery or sale of the device to the ultimate consumer or user.
    4. Section 807.20 is amended by revising paragraph (a)(4), by 
redesignating paragraph (d) as paragraph (c) and paragraph (c) as 
paragraph (d), respectively, and by adding paragraph (c)(3) to read as 
follows:

Sec. 807.20  Who must register and submit a device list.

    (a) * * *
    (4) Acts as an initial importer;
* * * * *
    (c) * * *
    (3) Acts as a wholesale distributor, as defined in Sec. 807.3(s), 
and who does not manufacture, repackage, process, or relabel a device.
* * * * *


Sec. 807.22  [Amended]

    5. Section 807.22 How and where to register establishments and list 
devices is amended in paragraph (c) by removing the words 
``distributor'' and ``distributors'' each time they appear

[[Page 51827]]

and by adding in their place the words ``initial importer'' and 
``initial importers'', respectively.

    Dated: July 15, 1998.
 William B. Schultz,
 Deputy Commissioner for Policy.
[FR Doc. 98-25796 Filed 9-28-98; 8:45 am]
BILLING CODE 4160-01-F