[Federal Register Volume 67, Number 15 (Wednesday, January 23, 2002)]
[Rules and Regulations]
[Pages 3060-3076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-1457]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Part 330

[Docket No. 96N-0277]
RIN 0910-AA01


Additional Criteria and Procedures for Classifying Over-the-
Counter Drugs as Generally Recognized as Safe and Effective and Not 
Misbranded

AGENCY: Food and Drug Administration, HHS.

ACTION: Final rule.

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

SUMMARY: The Food and Drug Administration (FDA) is issuing a final rule 
establishing additional criteria and procedures by which over-the-
counter (OTC) conditions may become eligible for consideration in the 
OTC drug monograph system. The criteria and procedures address how OTC 
drugs initially marketed in the United States after the OTC drug review 
began in 1972, and OTC drugs without any U.S. marketing experience, can 
meet the statutory definition of marketing ``to a material extent'' and 
``for a material time'' and become eligible. If found eligible, the 
condition would be evaluated for general recognition of safety and 
effectiveness in accordance with FDA's OTC drug monograph regulations. 
FDA is also changing the current OTC drug monograph procedures to 
streamline the process and provide additional information in the 
review.

DATES: This final rule is effective February 22, 2002.

FOR FURTHER INFORMATION CONTACT: John D. Lipnicki, Center for Drug 
Evaluation and Research (HFD-560), Food and Drug Administration, 5600 
Fishers Lane, Rockville, MD 20857, 301-827-2222.

SUPPLEMENTARY INFORMATION: The purpose of this final rule is to 
establish criteria and procedures by which OTC conditions may become 
eligible for consideration in the OTC drug monograph system. Currently, 
a sponsor wishing to introduce into the United States an OTC drug 
condition marketed solely in a foreign country must prepare and submit 
a new drug application (NDA). Likewise, companies with OTC drugs 
initially marketed in the United States after the 1972 initiation of 
the OTC drug review must have an NDA. This final rule provides 
procedures for these NDA drugs to become eligible for inclusion in the 
OTC drug monograph system by first submitting a time and extent 
application (TEA) to show marketing ``to a material extent'' and ``for 
a material time.'' Once determined eligible, safety and effectiveness 
data would be submitted and evaluated. This two-step process allows 
sponsors to demonstrate that eligibility criteria are met before having 
to expend resources to prepare safety and effectiveness data.

I. Background

    The OTC drug monograph system was established to evaluate the 
safety and effectiveness of all OTC drug products marketed in the 
United States before May 11, 1972, that were not covered by NDAs and 
all OTC drug products covered by ``safety'' NDAs that were marketed in 
the United States before enactment of the 1962 drug amendments to the 
Federal Food, Drug, and Cosmetic Act (the act). In 1972, FDA began its 
OTC drug review to evaluate OTC drugs by categories or classes (e.g., 
antacids, skin protectants), rather than on a product-by-product basis, 
and to develop ``conditions'' under which classes of OTC drugs are 
generally recognized as safe and effective (GRAS/E) and not misbranded.
    FDA publishes these conditions in the Federal Register in the form 
of OTC drug monographs, which consist primarily of active ingredients, 
labeling, and other general requirements. Final monographs for OTC 
drugs that are GRAS/E and not misbranded are codified in part 330 (21 
CFR part 330). Manufacturers desiring to market an OTC drug covered by 
an OTC drug monograph need not seek FDA clearance before marketing. In 
a future issue of the Federal Register, the agency will be publishing a 
final call for data for OTC drug products marketed in the United States 
before May 11, 1972, to be reviewed as part of the original OTC drug 
review.
    In the Federal Register of October 3, 1996 (61 FR 51625), FDA 
published an advance notice of proposed rulemaking (ANPRM) stating that 
it was considering proposing to amend its regulations to include 
criteria under which certain additional OTC drug conditions may become 
eligible for inclusion in the OTC drug monograph system. Interested 
persons were invited to submit written comments by January 2, 1997. The 
agency received 16 comments, which it discussed in section III of a 
proposed rule that was published in the Federal Register of December 
20, 1999 (64 FR 71062 at 71067) (the proposed rule).
    Under the proposal, eligibility for consideration in the OTC drug 
monograph system would be determined by showing a condition's use ``to 
a material extent'' and ``for a material time'' in compliance with the 
existing statutory requirements of the act. A number of ingredients 
have been marketed in OTC drug products under NDAs approved after May 
11, 1972. The agency provided criteria and procedures in this proposal 
for ingredients such as these to be considered for OTC drug monograph 
status.
    For OTC drug products without any U.S. marketing experience, this 
proposal represented a change in the agency's previous interpretation 
of ``use'' requirements in section 201(p) of the act (21 U.S.C. 
321(p)). Previously, the agency interpreted the use provision to mean 
use in the United States only. The agency proposed this change in 
policy to expand ``use'' to include foreign marketing experience 
because it believed that under certain circumstances use outside the 
United States may appropriately be considered to satisfy the use 
requirements in section 201(p) of the act.
    In the ANPRM, the agency used the term ``condition'' to refer to 
OTC drug active ingredients, indications, dosage forms, dosage 
strengths, routes of administration, and active ingredient 
combinations. In the proposed rule, the agency has used the term 
``condition'' to refer to an active ingredient or botanical drug 
substance (or a combination of active ingredients or botanical drug 
substances), dosage form, dosage strength, or route of administration, 
marketed for a specific OTC use. The agency has included the reference 
to botanical drug substance to recognize that the information needed 
for consideration of a botanical substance for inclusion in the OTC 
drug monograph system may differ from the information needed to 
evaluate other types of active ingredients for this purpose.

II. Description of the Proposed Rule

    The existing OTC drug regulations in part 330 do not define 
eligibility requirements for consideration in the OTC drug monograph 
system or what constitutes marketing to a material

[[Page 3061]]

extent or for a material time. The proposed rule and this final rule 
set forth criteria and procedures for considering additional 
``conditions'' (as discussed in section I of the proposed rule, 64 FR 
71062) in the OTC drug monograph system. The definition of 
``conditions'' appears in Sec. 330.14(a) of the final rule.
    The proposed rule established procedures for a sponsor with a 
condition it considered eligible for consideration to provide the 
agency certain information to establish eligibility. The proposed rule 
presented these procedures in table 1 format as part of a TEA as 
follows: (1) Basic chemical information about the ingredient 
(additional information needed for a botanical ingredient), (2) a list 
of all countries in which the condition has been marketed, (3) how the 
condition has been marketed in each country (e.g., OTC general sales 
direct-to-consumer, sold only in a pharmacy), (4) the number of dosage 
units sold, (5) marketing exposure (e.g., race, gender, ethnicity), (6) 
the use pattern in each country, (7) each country's system for 
identifying adverse drug experiences (ADEs), including method of 
collection, (8) how long the condition has been marketed in each 
country, (9) all labeling used during the marketing period in any 
country, and the time period each labeling was used, (10) all countries 
where the condition is marketed only as a prescription drug and the 
reasons why, and (11) all countries where the condition has been 
withdrawn from marketing or OTC marketing has been denied.
    If FDA determined the condition eligible for consideration in the 
OTC drug monograph system, it would publish a notice of eligibility in 
the Federal Register and place the TEA on public display. The sponsor 
and other interested parties would then submit data to support safety 
and effectiveness. If the agency tentatively determined the condition 
GRAS/E, it would propose to amend the applicable OTC drug monograph or 
propose a new monograph. There is a comment period for interested 
persons to comment on the agency's proposal, during which interim 
marketing would not be permitted. The agency would then publish a final 
rule, at which time marketing could begin.
    Interested persons were invited to submit comments by March 22, 
2000. The agency received comments from four industry trade 
associations, one health coverage association, three suppliers of OTC 
drug ingredients, and three manufacturers of OTC drug products.

III. Comments on the Proposed Rule

A. General Comments

    1. One comment contended that there is no legal basis for the 
agency's proposal. The comment disagreed with FDA's position that for a 
drug to qualify for inclusion in the OTC drug review and not be a new 
drug under section 201(p)(2) of the act the drug must have been used to 
a material extent or for a material time under its conditions of use in 
the United States only (64 FR 71062). The comment added that there is 
no basis in the act to support FDA's interpretation that foreign data 
cannot be used to satisfy the material time or material extent 
requirements of the act. The comment noted FDA's willingness in recent 
years to accept and rely upon foreign data as the basis for approving 
NDAs for prescription and OTC drugs, food additives, and premarket 
applications for medical devices.
    The agency explained in the proposal (64 FR 71062) that it had 
previously interpreted the ``use'' requirements in section 201(p) of 
the act to mean use in the United States only, and that the proposal 
represented a change in the agency's interpretation. The agency 
proposed this change in policy to expand ``use'' to include foreign 
marketing experience because it believed certain circumstances of use 
outside the United States may appropriately be considered to satisfy 
the use requirements in section 201(p) of the act. The agency considers 
this approach consistent with its use of foreign data as the basis for 
approving NDAs for prescription and OTC drugs, food additives, and 
premarket applications for medical devices. The agency continues to 
believe that there is an appropriate legal basis for the additional 
criteria and procedures in this final rule, as described in the 
proposal.
    2. One comment contended that the proposed procedures would 
effectively terminate the OTC drug monograph process as conceived and 
implemented to date, noting that the process has included flexibility 
to consider new conditions and allowed interim marketing for 
nonmonograph products. The comment added that the agency's procedural 
regulations for the OTC drug review were designed to be flexible and to 
establish a standard procedure first for the review of pre-1972 drugs 
and later to determine the status of post-1972 and foreign marketed 
drugs. The comment considered the new procedures inflexible and 
unworkable.
    The agency disagrees that the new procedures are inflexible and 
unworkable and would effectively terminate the OTC drug monograph 
process as conceived and implemented to date. The agency also disagrees 
that the procedural regulations for the OTC drug review were designed 
for review of post-1972 and foreign marketed drugs. The proposal (37 FR 
85, January 5, 1972) and the final rule (37 FR 9464, May 11, 1972) that 
established the OTC drug review only discussed OTC drugs ``now 
marketed.'' Estimates of the number of OTC drug products on the market 
(37 FR 85) only covered the United States. Thus, the original OTC drug 
review procedures were not developed to address post-1972 and foreign 
marketed drugs. Accordingly, the agency proposed (64 FR 71062 at 71067) 
and is modifying the existing procedures in Sec. 330.10 to make them 
consistent with the new scope of the review. Interim marketing is 
discussed in comment 21 of section III. D of this document.
    3. A number of comments contended that the proposed procedures and 
data requirements are too complex and protracted, unduly burdensome 
(more burdensome than the NDA process), unrealistic, prohibitive, and 
unwieldy to be of practical value to industry. The comments stated that 
the TEA is too onerous and broad in scope because it requires 
exhaustive information rather than adequate information to demonstrate 
marketing history. The comments argued that it is excessive to require 
exhaustive data from every country in the world for a threshold 
eligibility consideration. Another comment added that the requirement 
for a worldwide data search would be a disincentive to companies with 
good data from a few countries but without the resources to do a 
worldwide search. One comment added that the safety and effectiveness 
consideration should be based upon the quality of the data, not upon 
arbitrarily selected material times, material extents, or listing of 
countries, and that the scope of certain requirements is quite narrow 
and restrictive (e.g., show that pharmacy-only sale does not indicate 
safety concerns). Several comments requested that the procedures be 
more flexible and less complicated so as to encourage quality products 
to enter the review process rather than deter them from entry. Other 
comments suggested that the agency rescind the proposed rule. Two 
comments recommended that the agency use the same eligibility criteria 
for foreign ingredients as used for domestic ingredients in the 
original OTC drug review.
    The agency does not consider the TEA too onerous or broad in scope. 
The TEA is designed to provide FDA basic

[[Page 3062]]

information about a condition for which it may have little or no 
information. The TEA is also designed to provide sufficient information 
to allow for a one-time assessment of a condition's eligibility for 
consideration in an OTC drug monograph. The agency agrees with the 
comments that it is not necessary to require exhaustive data from every 
country in the world for a threshold eligibility consideration and has 
modified some of the TEA requirements (see comment 12 of section III.B 
of this document). The agency agrees that the safety and effectiveness 
consideration should be based upon the quality of the data. The agency 
does not believe that the procedures will deter quality products from 
entering the review process because products with quality data should 
be able to readily meet the requirements of the process. Excluding 
prescription-to-OTC switches that the panels could consider, the 
primary criterion for eligibility in the original OTC drug review was 
that the ingredient had to be in the U.S. OTC market before May 11, 
1972. It would not be practical to use that date for foreign conditions 
because many conditions that entered the market after that date would 
be excluded. In addition, none of the foreign conditions have been 
marketed in the United States and the United States has no experience 
with these conditions. The agency has developed eligibility criteria, 
as discussed in the preamble of the proposed rule (64 FR 71062 to 
71064), that it considers necessary to provide sufficient information 
for a condition to be considered for inclusion in the OTC drug 
monograph system. The agency finds no basis to rescind the proposed 
rule, and the agency is publishing a final rule so that additional 
conditions may now begin to be considered.
    4. One comment contended that the proposed procedures would 
establish a nontariff trade barrier in violation of the General 
Agreement on Tariffs and Trade (GATT). The comment stated that the 
proposal differentiates between a cosmetic-drug sold in the United 
States prior to 1972, which is eligible for inclusion in the OTC drug 
review without any further information, and a cosmetic-drug sold 
outside the United States prior to 1972, which would be eligible only 
after submitting a comprehensive TEA. The comment added that the 
proposal also discriminates against foreign products by prohibiting 
marketing until publication of a final monograph, while U.S. products 
may generally be marketed after publication of a tentative final 
monograph (TFM).
    The issue of a trade barrier in violation of GATT was also raised 
in the comments on the ANPRM and was discussed in comment 11 of section 
III.B of the proposed rule (64 FR 71062 at 71072). The agency does not 
believe that any provisions of this final rule would violate GATT 
(which is now one of the multilateral agreements annexed to the 
agreement establishing the World Trade Organization). Among other 
reasons, foreign-manufactured products marketed in the United States 
prior to 1972 are treated the same as domestic manufactured products 
marketed in the United States prior to 1972. Similarly, both foreign 
and domestic manufactured products marketed in the United States after 
1972 under NDAs would be eligible for consideration in the OTC drug 
review after submission of the same TEAs demonstrating that the same 
material time and extent criteria have been met. Foreign manufactured 
products previously marketed only in foreign countries would also be 
eligible for consideration in the OTC drug review after submission of 
TEAs that show these same material time and extent criteria have been 
met. Under this rule, drugs produced in the United States and those 
produced abroad would be treated the same way, and both would be 
required to comply with U.S. labeling and manufacturing requirements as 
a condition of marketing in the United States.
    Interim marketing is discussed in comment 21 of section III.D of 
this document. Under Sec. 330.14(h), products previously marketed only 
in foreign countries that are included in a tentative final monograph 
may also, if appropriate, be marketed in the United States before 
completion of the final monograph.
    The provisions of this final rule serve to promote and protect 
human health and safety and do not create trade barriers.
    5. One comment noted that under the proposal a condition is not 
eligible for OTC drug monograph status if marketing in the United 
States is limited to prescription drug use only and requested the 
agency to expand the criteria for monograph status to include drugs 
marketed by prescription in the United States. The comment contended 
that FDA may determine drugs to be eligible as GRAS/E for an OTC drug 
monograph on the basis of various types of evidence, including 
``significant human experience during marketing.'' The comment 
contended that if adequate adverse event information is available for 
foreign OTC drugs that remain prescription drugs in the United States, 
FDA should allow consideration of these active ingredients for possible 
inclusion in an OTC drug monograph. The comment added that certain 
prescription conditions were considered for and added to the OTC drug 
monographs during the original OTC drug review (drugs marketed prior to 
1972). Another comment considered the proposal narrow and restrictive 
because a drug sold OTC in some foreign countries would be ineligible 
for monograph status if it is marketed by prescription in the United 
States.
    The agency agrees with the comments and believes there was an 
inconsistency with the criteria proposed in Sec. 330.14(b). Under the 
proposed criteria, a condition marketed OTC in one or more foreign 
countries that is limited to prescription use in other foreign 
countries would be considered for eligibility in the OTC drug monograph 
system. However, a condition marketed OTC in one or more foreign 
countries that is limited to prescription drug use in the United States 
would not be considered for eligibility. The agency has decided to 
address this inconsistency by removing the criterion in proposed 
Sec. 330.14(b)(2) to allow conditions marketed OTC in foreign countries 
that are limited to prescription drug use in the United States to be 
considered for eligibility in the OTC drug monograph system. If such a 
condition is found to be eligible, the sponsor must then provide the 
necessary information, which would include the U.S. prescription 
marketing experience, as part of the safety and effectiveness 
submission to establish that the condition is appropriate for OTC 
status in the United States and that it can be marketed as GRAS/E under 
the OTC drug monograph system. The agency believes that it can 
adequately address in its monograph review the issues associated with a 
product's prescription use in the United States, and the 
appropriateness of switching the product to OTC use.
    6. One comment contended that there is no need for FDA to make a 
material time/extent determination wholly separate from its 
consideration of safety and effectiveness.
    The agency discussed this subject in comment 13 of section III.C of 
the proposed rule (64 FR 71062 at 71073) and provided three reasons for 
the two-step review approach. The comment did not provide any reasoning 
to support rejecting this approach, and the agency concludes that 
separate evaluations of material time/extent and safety/effectiveness 
are the most efficient way to evaluate these additional conditions

[[Page 3063]]

for inclusion in an OTC drug monograph.

B. Comments on Criteria for Time and Extent of Marketing

    7. One comment contended that the TEA filing reflects a 
misunderstanding that sponsors must show both material time and 
material extent. The comment stated that a product is legally required 
to satisfy the requirement of ``to a material extent'' or ``for a 
material time,'' which was intended to satisfy the requirement that a 
drug be used for sufficient time or have wide enough distribution for 
discovery of any adverse experiences.
    The agency discussed this subject in comment 8 of section III.A of 
the proposed rule (64 FR 71062 at 71069 to 71070). The agency explained 
there why a condition that is considered ``not a new drug'' must 
satisfy both the material extent and the material time criteria in 
section 201(p)(2) of the act. The comment did not provide any 
information to change the agency's position.
    8. One comment agreed with most of the proposed time and extent 
criteria, but contended that specific data on the number of dosage 
units sold in each country (number of units sold by package sizes, 
number of doses per package based on labeled directions for use) is 
difficult to compile, unnecessarily detailed for evaluating time and 
extent of marketing, and unlikely to be maintained by industry with the 
degree of specificity proposed in the rule. The comment concluded that 
specific marketing information related to dosage units should be 
required only to the extent it is reasonably capable of being compiled. 
A second comment stated that there should be no numerical floor for the 
number of units that must have been marketed. Another comment stated 
that the number of dosage units sold should be replaced by the total 
quantity of product sold, with an extrapolation to the number of 
consumer units based on average package size.
    The agency has reconsidered how information should be provided on 
the number of dosage units sold. The agency's primary concern is 
determining consumer exposure to the condition. The agency has 
determined that the number of units sold by package sizes (e.g., 24 
tablets, 120 milliliters (mL)) and the number of doses per package 
based on the labeled directions for use may not be necessary to 
determine a condition's extent of marketing and is removing these 
requirements from proposed Sec. 330.14(c)(2)(ii). Instead, the agency 
is only requiring a list of the various package sizes for each dosage 
form in which the condition is marketed OTC along with an estimate of 
the minimum number of potential consumer exposures to the condition 
using one of the following calculations: (1) Divide the total number of 
dosage units sold by the number of dosage units in the largest package 
size marketed, or (2) divide the total weight of the active ingredient 
sold by the total weight of the active ingredient in the largest 
package size marketed. Information on package size should be readily 
available from marketers of the product, if other than the sponsor, or 
other marketing sources (e.g., wholesalers) and will allow the sponsor 
to estimate the minimum number of potential consumer exposures to the 
condition. In addition, to ensure that consumer exposure is adequate 
for any one dosage form, the agency is changing the proposed criterion 
in Sec. 330.14(c)(2)(ii) to state ``The total number of dosage units 
sold for each dosage form of the condition.'' One comment's request for 
replacing `` the number of dosage units sold'' with ``total quantity of 
product sold'' is discussed in comment 11 of section III.B of this 
document. The agency agrees that there should be no numerical floor for 
the number of dosage units that must be marketed and is not including 
such criteria in this final rule.
    9. One comment requested the agency to reconsider its requirement 
for information regarding geographical and cultural differences (e.g., 
race, gender, ethnicity) between the countries where the product has 
been marketed and the U.S. population. The comment contended that this 
information is difficult to obtain, subjective in nature, and subject 
to inconsistent evaluation. The comment maintained that specific 
marketing information related to geographic and cultural distinctions 
should be required only to the extent it is reasonably capable of being 
compiled. The comment requested that FDA require this information only 
in those situations where it is aware of specific cultural and/or 
geographical differences that would be relevant to the review process. 
Another comment stated that it should be possible to refer to large 
geographical areas (e.g., the population of the European Union) to 
support sufficient variability in terms of culture and gender to show 
adequate population exposure.
    The agency discussed the need for marketing exposure data in 
comment 11 of section III.B of the proposed rule (64 FR 71062 at 71071 
to 71072). Because of the potential breadth of this requirement, the 
agency is modifying the criteria in proposed Sec. 330.14(c)(2)(iii) to 
require, as a means of determining marketing exposure, information on 
the population demographics (percentages of various racial/ethnic 
groups) for each country where the condition has been marketed and the 
source(s) from which this information has been compiled. Examples of 
sources for this information include the following Internet sites: 
http://www.cia.gov/cia/publications/factbook/index.html, and http://www.state.gov/www/background /index.html. The national statistical 
office for the individual country also may provide relevant 
information. The agency believes this information will not be difficult 
to obtain or subjective in nature, and that it can be evaluated 
consistently. Although sponsors may use the categories and definitions 
in the Office of Management and Budget's Federal Register notice, 
entitled ``Revisions to the Standards for the Classification of Federal 
Data on Race and Ethnicity,'' when describing the population 
demographics of each country, the agency is removing the reference to 
this document from Sec. 330.14(c)(2)(iii) because other countries may 
not use all of these categories and definitions.
    10. One comment requested that use pattern information (e.g., how 
often and how long the ingredient is to be used according to its 
labeling) (proposed Sec. 330.14(c)(2)(iv)) be included as part of the 
safety evaluation rather than as part of the time and extent 
information. The comment stated that such information involves an 
evaluation of historical labeling and appears to be related to safety; 
thus, it is more appropriate in the safety submission rather than in 
the TEA.
    The agency discussed the need for providing use pattern information 
as part of the TEA in comment 7 of section III.A of the proposed rule 
(64 FR 71062 at 71069). The agency stated that this information was 
needed at that stage of the condition's review to determine if a 
product's use is different in other countries than it would be in the 
United States. However, the agency is modifying the criterion in 
proposed Sec. 330.14(c)(2)(iv) to require use pattern information only 
when the use pattern varies between countries or when it has changed 
over time in one or more countries. The agency agrees that use pattern 
information is also related to the condition's safety, and also may 
consider it in the safety evaluation.
    11. Two suppliers of active ingredients expressed concern about 
being able to provide accurate information on how their ingredients

[[Page 3064]]

are marketed in final form, the number of final product units sold, and 
the labeling or adverse event reports relevant to finished products. 
One supplier stated that it could provide information about the 
countries in which the active ingredients are sold and the quantities 
sold for OTC use, but that customers would be unlikely to provide their 
sales data. The comments asked FDA to accept sales and related 
information from active ingredient manufacturers as evidence of 
material time and material extent.
    The agency has reconsidered the information requirements for a TEA. 
In addition to the revised requirements discussed in response to other 
comments, sponsors of TEAs who are manufacturers or suppliers of OTC 
active ingredients may provide dosage unit information as total weight 
of active ingredient sold (cumulative total for the specific condition 
being considered) for each country in which the condition is marketed. 
This revision to Sec. 330.14(c)(2)(ii) provides active ingredient 
manufacturers a mechanism to provide pertinent sales data. The agency 
has also reduced the amount of labeling information that must be 
provided (see comment 14 of section III.B of this document). The agency 
discussed the availability of ADE information in the proposal (64 FR 
71062 at 71070 to 71071) and the comment did not provide any basis to 
support changing this requirement.
    12. One comment agreed with the importance of the objectives of the 
data requested in proposed Sec. 330.14(c)(2), i.e., that detailed 
information from a number of countries addresses some of the ethnic, 
cultural, and racial variances that may exist among users in foreign 
markets and the relevance of this information to potential use of the 
product in the United States. However, the comment considered it 
burdensome to provide this information from all countries if the 
product is marketed in a large number of foreign countries. The comment 
suggested an alternate TEA requirement for products that have 5 years 
or more of continuous marketing in 50 or more countries and marketing 
for 20 years or more in one of the ``Tier 1'' countries for purposes of 
the export provisions of section 802(b)(1)(A) of the act (21 U.S.C. 
382). These countries include Australia, Canada, Israel, Japan, New 
Zealand, Switzerland, South Africa, and the European Union (EU) or a 
country in the European Economic Area (the countries in the EU and the 
European Free Trade Association).
    The comments suggested that sponsors meeting the threshold criteria 
would be permitted to select, after consultation with FDA, six 
countries that represent both significant markets for the product and 
cultural diversity. The sponsor would then complete the TEA with 
information applicable to the six countries or, with FDA's agreement, 
obtain information by contacting public health officials and otherwise 
soliciting information on the type of marketing, patterns and 
conditions of use, and adverse drug experiences from product users in 
each selected country. The comment concluded that this approach should 
provide the necessary information for FDA to make its evaluation and 
provide sponsors the opportunity to consult with the agency to develop 
reasonable means to collect the information needed to assure FDA of the 
suitability of foreign-marketed conditions. Another comment stated that 
the information requested in proposed Sec. 330.14(c)(1), (c)(2)(ii), 
(c)(2)(iv), and (c)(3) is very difficult, if not impossible, for a 
manufacturer of the raw material to provide because only the 
manufacturers of finished products would be able to provide this 
information. The comment recommended that for classes of OTC drugs for 
which there are only qualitative instructions for use, such as for 
sunscreen and antidandruff products, the basic information required 
would be based on the number of kilograms of the active ingredient sold 
per year and per country for this intended drug use. In addition, the 
regulatory status of the ingredient in those countries that have 
specific legislation controlling the usage of the ingredient, and the 
maximum amount of the substance allowed to be marketed, would be 
provided. The comment recommended revisions to Sec. 330.14(c)(1), 
(c)(2)(ii), (c)(2)(iv), and (c)(3) and the following new 
Sec. 330.14(c)(2)(vi) to allow certain products to comply with proposed 
Sec. 330.14(c)(2)(ii):
    For sunscreen and antidandruff OTC drugs in which there are no 
quantitative dosage instructions for the use of the products in the 
final monographs, list all countries that the drug is approved for use, 
what maximum concentrations are allowed, any restrictions on usage that 
are enforced, the number of kilograms sold per country (per year and 
cumulative), what known adverse effects have been reported and list the 
other drugs in the same OTC category that it has been combined with. 
This data to be supplied in tabulated form.
    The comment further suggested that these modifications be limited 
to OTC sunscreen drugs that are permitted for use in annex VII of the 
EU Cosmetics Directive and the OTC antidandruff drugs that are 
regulated as preservation materials in annex VI, or are for restricted 
use as indicated in annex III of the EU Cosmetics Directive for this 
purpose. The comment concluded that this approach should assure FDA 
that the active ingredients in these two classes have had a pedigree of 
peer review and/or a history of long usage in the EU. Another comment 
strongly supported annex VII of the EU Cosmetics Directive to 
demonstrate the safety and effectiveness of four sunscreen agents 
marketed in Europe.
    Another comment contended that it should not be necessary to submit 
a TEA for an ingredient that has been sold in the United States [under 
an NDA] for a material time and extent, e.g., including ibuprofen in 
the internal analgesic monograph. The comment added that under the 
proposal the only information exempted is labeling from every country.
    The agency agrees with the first comment that it may not be 
necessary to provide detailed information from each country in which a 
condition is marketed if the condition has extensive marketing in a 
large number of foreign countries. The agency is providing an alternate 
TEA requirement if a condition has been marketed OTC in five or more 
countries with a minimum of 5 continuous years of marketing in at least 
one country. Sponsors who have this extensive marketing experience for 
a condition should select at least five of these countries from which 
to submit information in accord with Sec. 330.14(c)(2)(i) through 
(c)(2)(iv). Countries that are selected must include the country with a 
minimum of 5 continuous years of OTC marketing, countries that have the 
longest duration of marketing, and countries having the most support 
for extent of marketing, i.e., a large volume of sales with cultural 
diversity among users of the product. If the condition meets these 
criteria in countries listed in section 802(b)(l)(A) of the act, some 
of these countries should be included among the five selected. Sponsors 
should provide information from more than five countries if they 
believe that it is needed to support eligibility. Sponsors should 
explain the basis for the countries selected in the TEA. This alternate 
TEA requirement appears in Sec. 330.14(c)(4) of this final rule.
    Even though sunscreen and antidandruff products are regulated 
differently by the EU, both are considered OTC drugs in the United 
States and are so regulated as part of the OTC drug monograph system. 
The agency recognizes that it may be difficult for manufacturers of the 
raw

[[Page 3065]]

material to obtain some of the information on finished products. 
Therefore, the agency is not requiring raw material manufacturers to 
provide the number of dosage units sold in each country (see comment 11 
of section III.B of this document). The total weight of active 
ingredient sold per country (cumulative) for the intended use of the 
condition will be adequate, and the agency has revised proposed 
Sec. 330.14(c)(2)(ii) accordingly in this final rule. The other 
required information in the comment's proposed Sec. 330.14(c)(2)(vi) is 
already included in other parts of the regulation. Therefore, the 
agency sees no need to adopt new Sec. 330.14(c)(2)(vi).
    The agency concludes that it is still necessary to submit a TEA for 
an ingredient already marketed OTC in the United States under an NDA 
because the agency needs to evaluate if the condition has been marketed 
to a material extent and for a material time whether the OTC marketing 
was in the United States or elsewhere. In the proposal (64 FR 71062 at 
71081), the agency stated that information on marketing exposure 
(proposed Sec. 330.14(c)(2)(iii)) and the length of time the condition 
has been marketed in each country accompanied by all labeling used 
during the marketing period (proposed Sec. 330.14(c)(3)) need not be 
provided for OTC drugs that have been marketed for more than 5 years in 
the United States under an NDA. In this final rule, the agency is 
removing the requirements to submit certain information if the 
condition has more than 5 years marketing in the United States under an 
NDA including: (1) How the condition has been marketed 
(Sec. 330.14(c)(2)(i)), (2) a description of each country's system for 
identifying ADEs (Sec. 330.14(c)(2)(v)), and (3) all countries where 
the condition is marketed only as a prescription drug 
(Sec. 330.14(c)(5)). The agency is not requiring this information 
because the information needed to satisfy these requirements is 
obtainable from the NDA.
    13. One comment urged that there not be a rigid and inflexible 5-
year marketing requirement to determine material time prior to 
considering monograph status for an OTC drug active ingredient.
    The agency discussed this subject in comment 6 of section III.A of 
the proposed rule (64 FR 71062 at 71069). The agency noted there that 
in response to the ANPRM a number of comments agreed with the proposed 
5-year minimum requirement to satisfy marketing for a material time. 
The agency considers a minimum of 5 years of OTC marketing experience a 
necessary duration of time to detect infrequent but serious ADEs that 
are occurring and, thus, provide an appropriate margin of safety. The 
comment did not provide any information to change the agency's 
position. However, the agency is modifying the eligibility criteria in 
proposed Sec. 330.14(b)(3) (new Sec. 330.14(b)(2)) by deleting the word 
``countries'' to clarify that the minimum requirement is 5 continuous 
years of marketing in the same country. Although the agency recognizes 
that some conditions may be able to demonstrate marketing to a material 
extent from marketing in only one country, some conditions may not be 
able to do so. Therefore, the agency is adding the following sentence 
to the criteria in new section Sec. 330.14(b)(2): ``Depending on the 
condition's extent of marketing in only one country with 5 continuous 
years of marketing, marketing in more than one country may be 
necessary.''
    14. Two comments contended that marketing history (proposed 
Sec. 330.14(c)(3)) will be difficult to obtain and requested the agency 
to limit information to a review of time and extent of marketing. One 
comment requested that specific marketing information related to 
historical product labeling be required only to the extent it is 
reasonably capable of being compiled.
    The agency has reassessed the historical labeling requirements in 
proposed Sec. 330.14(c)(3) and determined that the requirements can be 
modified. Because additional warning and direction information is most 
likely added over time rather than removed, the agency believes that a 
condition's current labeling will provide the appropriate, needed 
information. Therefore, the agency is revising proposed 
Sec. 330.14(c)(3) to require that sponsors submit a statement of how 
long the condition has been marketed in each country and how long the 
current product labeling has been in use. In addition to providing a 
copy of the current product labeling, the sponsor should state whether 
that labeling has or has not been authorized, accepted, or approved by 
a regulatory body in each country where the condition is marketed.

C. Comments on Administrative Procedures

    15. Two comments stated that timeframes should be established for 
publication of proposed and final rules. Based on considerable delays 
in the rulemaking process, the comments believed that the delay between 
publication of a proposed and final rule will not be minimal. Two 
comments urged the agency to institute specific timeframes for review 
of TEAs (one comment recommended 90 days) and safety and effectiveness 
submissions. The comments stated that the OTC drug review was 
implemented in 1972, and has yet to be completed and that some foreign 
ingredient petitions have languished before the agency for years. One 
comment expressed concern that submissions would continue to languish 
without specific review timeframes. The comment cited the agency's 
rationale in the proposed rule for not including review timeframes. The 
comment argued that it is the applicant's responsibility to ensure that 
submissions are prepared adequately and that it is unlikely that the 
agency will be overrun with applications upon implementation of the 
final rule. The comment stated that review timeframes would be in 
keeping with the goal of the Food and Drug Administration Modernization 
Act (FDAMA) to improve the efficiency of application review and that 
the agency has a public health obligation to ensure that applications 
are reviewed in a timely manner. The comments concluded that it is 
critical that timeframes be established if the agency does not permit 
interim marketing.
    The agency agrees that TEAs and safety and effectiveness 
submissions should be reviewed in a timely manner consistent with the 
goal of improved efficiency. The Division of OTC Drug Products will be 
responsible for evaluating all TEAs and overseeing the progress of 
safety and effectiveness reviews. As differences will invariably occur 
in the quantity and quality of the TEA and GRAS/E submissions received, 
it is not possible to set exact timeframes for completing these 
reviews. The Division will strive to complete TEA evaluations within 90 
to 180 days of receipt and will implement procedures to ensure that 
agency resources are used appropriately and result in timely action on 
safety and effectiveness submissions. The Division will contact the 
sponsor within 180 days about the status of its request.
    The anticipated workload for reviewing these additional conditions 
is difficult to predict. The agency estimated in the proposal (64 FR 
71062 at 71078 to 71079) and in this final rule that the number of TEAs 
submitted annually would be 50, with 30 approved, and with 3 subsequent 
safety and effectiveness submissions for each approved TEA. The agency 
received only one comment on these estimates to

[[Page 3066]]

help with its workload projections. That comment stated that it is 
unlikely that the agency will be overrun with applications upon 
implementation of the final rule. The agency notes that another comment 
from a foreign industry association representing the cosmetics, 
toiletries, perfumes, and detergent industry stated that it represented 
350 member companies who produce cosmetic products for markets all over 
the world and that it has been waiting for this new process for a long 
time (Ref. 1). If a number of this association's members sponsor TEAs, 
the agency's workload estimates could be low. The agency predicts that 
as it gains experience with evaluating the foreign data, the speed of 
its reviews should increase. While the agency is currently unable to 
project the timeframe it will take to publish proposed rules, it 
anticipates that the time between proposed and final rules should be 
short, in many cases because the proposed action will be to add another 
ingredient to an already existing monograph for which the basic OTC 
labeling for the product is already established. When a new monograph 
and OTC drug product labeling is initially established, the agency 
anticipates that the timeframe between proposed and final rules may be 
somewhat longer.
    16. One comment offered suggestions for streamlining the review 
process for TEAs and safety and effectiveness submissions. For TEAs, 
the comment suggested that the agency publish a guidance document to 
help ensure that the content and format of applications are submitted 
in a uniform matter. The comment stated that the agency could then use 
the refuse-to-file concept for applications that do not meet the basic 
requirements. For safety and effectiveness submissions, the comment 
fully supported voluntary use of accredited outside organizations or 
individuals, such as a third-party review program developed by the 
European Sunscreen Manufacturers Association (Ref. 2) or FDA's medical 
devices pilot program for third-party review of selected premarket 
notifications . The comment believed that the agency could implement 
such a program under the authority of FDAMA. Another comment also 
strongly supported third party review to reduce review time.
    The agency may publish a guidance document to assist manufacturers 
to organize TEAs in a uniform manner. However, the agency did not want 
to delay publication of this final rule while developing that guidance 
document. In the meantime, sponsors should organize their TEA in the 
sequence in which information is listed in Sec. 330.14(c). The agency 
will not use a ``refuse-to-file'' concept (a threshold determination) 
for TEAs that do not meet the basic requirements. The agency will do a 
substantive review of all TEAs, and any TEA that does not contain the 
required information will result in the condition being found not 
eligible for consideration.
    The agency used a third party review system (advisory review 
panels) for the original OTC drug review and states that it may use an 
advisory review panel in Sec. 330.14(g) of the new procedures. When a 
third-party reviews the safety and effectiveness data, the agency still 
needs to do its own independent evaluation of the data. Therefore, in 
the new procedures in Sec. 330.14(g), the agency states that it may 
evaluate the data in conjunction with the advisory review panel or on 
its own without using an advisory review panel. Both of these 
procedures are intended to reduce the overall review time. Based on the 
number of conditions submitted for review, the agency may consider 
other alternatives, as necessary, to review submissions in a timely 
manner.
    17. Two comments requested confirmation that the agency would 
maintain the confidentiality of ineligible TEAs. One comment 
recommended that this information be returned to the applicant. The 
comments also requested confirmation that sales data identified by the 
company in an eligible TEA as trade secret or confidential would remain 
confidential under 18 U.S.C. 1905, 5 U.S.C. 552(b), or section 301(j) 
of the act (21 U.S.C. 331(j)). One comment stated that it is unclear 
whether the agency intends to notify the applicant if it does not agree 
with the request for confidential treatment. The comment requested that 
the agency clarify that it will give notice, consistent with 5 U.S.C. 
552(b), so that applicants can determine whether to withdraw the 
information.
    The procedures related to the confidentiality of a TEA are in 
Sec. 330.14(d). FDA processes a TEA as confidential until a decision is 
made on the eligibility of the submitted condition for consideration in 
the OTC drug monograph system. If the condition is not found eligible, 
the agency will not place the TEA on public display. Only a letter from 
the agency to the applicant, stating why the condition was not found 
acceptable, will be placed on public display in the Dockets Management 
Branch. However, the agency cannot return the TEA to the applicant, but 
must retain it as the data upon which the agency made its decision.
    If the condition is found eligible, the agency will place the TEA 
on public display after deletion of any information deemed confidential 
under 18 U.S.C. 1905, 5 U.S.C. 552(b), or 21 U.S.C. 331(j). This is 
similar to the process used for submissions to the advisory review 
panels under Sec. 330.10(a)(2) of the OTC drug review administrative 
procedures. Under those procedures, when the agency published a panel's 
report (ANPRM) in the Federal Register, it stated in the notice that 
all of the information that had been submitted to the panel would be 
put on public display 30 days after the date of publication except to 
the extent that the person submitting it demonstrates that it falls 
within the confidentiality provisions of 18 U.S.C. 1905 or 21 U.S.C. 
331(j). (Section 330.10(a)(2) has been updated to also include 5 U.S.C. 
552(b).) None of the information submitted to the panels was 
specifically designated as confidential. Requests for confidentiality 
were to be submitted to the agency during that 30-day period for the 
agency to evaluate before placing the submissions on public display. 
Under the new procedures in Sec. 330.14(d), a sponsor must identify 
what information in the TEA it considers confidential under the above 
statutory provisions. The agency's general philosophy is that most, if 
not all of the information in a TEA should be considered public 
information. As discussed below, the agency has revised the information 
requirements to take this into account.
    The agency has determined that most of the required information 
would not be considered confidential in making an eligibility 
determination. Total sales figures covering a period of years 
historically have not been considered confidential in the OTC drug 
review process. The agency has determined that yearly sales figures do 
not need to be provided and has revised proposed Sec. 330.14(c)(2)(ii) 
accordingly in this final rule. However, if a sponsor needs to provide 
yearly sales figures to explain something about the marketing of a 
condition, it should do so but should not expect the agency to keep the 
information confidential.
    Section 330.10(a)(2) only requires a sponsor to provide a statement 
of the quantities of active ingredients of the drug product. It does 
not require inactive ingredient information and that information should 
not be provided unless it appears in the product's labeling. 
Information about a color or fragrance in the product is not required 
and should not be included in the TEA. Information about inactive 
ingredients generally is not considered confidential, because such 
information would appear

[[Page 3067]]

in the labeling of the OTC drug or drug-cosmetic product in the United 
States. If a specific manufacturing process is included in a TEA 
because that information is necessary to explain the product and that 
process relates to the ``product'' and not the ``active 
ingredient(s),'' it may be considered confidential, unless it has a 
bearing on the product's safety and effectiveness. Other than this 
limited situation, the agency does not anticipate that other 
information in a TEA will be considered confidential. The agency's view 
is that consideration for OTC drug monograph status is a public process 
and all information provided should be part of the public record if the 
condition is determined to be eligible. If the agency does not agree 
with a sponsor's request for confidential treatment of specific parts 
of a TEA, it intends to discuss the matter with the sponsor before 
placing the TEA on public display, just as it did with parts of the 
submissions made to the panels under the original OTC drug review.
    18. One comment recommended that any advisory committees used to 
make GRAS/E determinations for foreign marketed products be comprised 
of experts with OTC drug experience, including experience outside of 
the United States. The comment stated that this is necessary to 
properly assess and appreciate the full implications of non-U.S. 
marketing and regulatory systems under which these ingredients may have 
been marketed.
    The agency intends to use its Nonprescription Drugs Advisory 
Committee (NDAC) as the primary advisory committee to consider GRAS/E 
determinations for foreign marketed products. NDAC will be supplemented 
by members from other committees as applicable to the subject matter 
being considered. These committee members will have OTC drug 
experience, some of which may include experience outside of the United 
States, depending on the composition of the agency's advisory 
committees, which changes yearly. The agency intends to allow sponsors 
to present information to inform advisory committees that consider 
GRAS/E determinations for foreign marketed products about the 
regulatory systems under which these ingredients may have been 
marketed.
    19. One comment recommended that sponsors be tentatively notified 
if the condition can not be GRAS/E and be provided an opportunity to 
supplement their submission or withdraw it, rather than receiving 
notification from the agency that the condition is not GRAS/E. The 
comment explained that a determination of not GRAS/E may be 
inconsistent with the condition's regulatory status in other countries, 
and the sponsor should have the opportunity to withdraw the submission 
prior to a final agency decision.
    The agency intends to use its established OTC drug review feedback 
procedures to notify sponsors and other interested parties who have 
submitted data and information in response to a notice of eligibility 
if a condition has been determined not to be GRAS/E. Parties can 
respond to a feedback letter and supplement their submissions. The 
agency may request a response within a specified timeframe in order to 
complete its review in a timely manner. A sponsor can also withdraw its 
request for the agency to consider its submission (which would not stop 
the agency from publishing its decision in the Federal Register), but 
the submission is part of a public docket and will not be returned. 
Parties will have another opportunity to respond when the agency 
publishes a notice of proposed rulemaking to include the condition in 
Sec. 310.502 (21 CFR 310.502). (See Sec. 330.14(g)(4) and (g)(5).)
    20. One comment requested that the agency begin to accept TEAs 
pending the completion of the final rule. The comment based this 
request on the delay in issuing the final rule and numerous citizen 
petitions pending before the agency. The comment stated that such 
actions would be consistent with notifications for Generally Recognized 
as Safe (GRAS) status for food substances under the agency's proposed 
rule for GRAS notifications. The comment also requested that the agency 
equitably resolve its back log of citizen petitions by giving priority 
to those petitions which have been pending for more than 10 years.
    The agency decided not to accept TEAs prior to completion of the 
final rule so that all TEAs that are submitted will be in the format 
required by this final rule. Likewise, the agency will be responding to 
the pending citizen petitions (for considering certain foreign 
conditions for OTC drug monographs) by telling the petitioners to 
submit TEAs with the required information in the proper format. A 
petitioner should be able to readily convert their petition to a TEA 
and submit it to the agency to begin the review process. TEAs will 
generally be reviewed in the order they are received. However, if the 
petitioners convert their pending citizen petitions to TEAs and submit 
them within 120 days of the publication date of this final rule, the 
agency will give these TEAs priority review.

D. Comments on Marketing Policy

    21. A number of comments disagreed with the agency's proposed 
marketing policy. The comments requested that the agency allow interim 
marketing at different times: (1) Once the condition has been 
determined eligible for consideration, or (2) once the condition has 
been proposed in the Federal Register as GRAS/E and a United States 
Pharmacopeia (USP) monograph is in place. The comments stated that 
interim marketing has existed for U.S. marketed products under the OTC 
drug review, there is precedent for extension of the practice under the 
new criteria, and most conditions submitted for consideration will pose 
no greater risk than category III ingredients currently marketed or 
marketed over the last 25 years. The comments stated the principles of 
administrative law require the agency to apply practices consistently 
between similar products with similar circumstances. One comment 
concluded that, at a minimum, the agency should consider requests for 
interim marketing as part of the TEA and approve such marketing on a 
case-by-case basis. Another comment added that there is a need for 
access to a broader range of safe and effective OTC sunscreen 
ingredients and the agency should distinguish these ingredients. The 
comment believed interim marketing for sunscreens and other topical 
products should be available if the condition has been cleared for 
safety by an appropriate foreign governmental body such as the 
Scientific Committee on Cosmetics and Non-Food Products (SCCNFP) in 
Europe.
    One comment believed that the prohibition against interim marketing 
would inappropriately bar the marketing of a product that is not a 
``new drug'' and would be inconsistent with the agency's current 
enforcement policy regarding interim marketing of products currently 
under consideration in the OTC drug monograph system. Two comments 
claimed that a condition marketed after it has been proposed in Federal 
Register as GRAS/E does not constitute a ``new drug'' under the 
statutory definition. One comment maintained that a condition is 
legally no longer a new drug once it has been found to be GRAS/E and 
been determined to be marketed to a material extent and for a material 
time. The comments stated that there is no statutory authority for the 
agency to prevent the marketing of a product that is not a new drug, 
and that the agency has no legal basis for taking enforcement action 
against the marketing of such

[[Page 3068]]

products. The comment concluded that once a proposed monograph 
amendment is published in the Federal Register, there is no sound 
policy basis for permitting the marketing of conditions with U.S. 
marketing history and not permitting marketing of conditions with 
foreign marketing history.
    Other comments contended it was not necessary to only allow 
marketing under final OTC drug monographs. One comment contended that 
it is not clear whether foreign marketed OTC products would present any 
greater risk than domestic products at the same stage of review. The 
comment added that to prohibit interim marketing implies that public 
comment on safety and effectiveness is required to validate the 
agency's conclusions. The comment maintained that this position is 
inconsistent with the agency's expert role of safeguarding the public 
health. Two comments disagreed that marketing only under a final OTC 
drug monograph would allow for a thorough public consideration of any 
safety and effectiveness issues that might arise before marketing 
begins. One comment stated that the examples given by the agency of 
topically applied ingredients with prior safety concerns was not 
persuasive. The comment noted that the safety concerns were not so 
significant as to prevent OTC marketing of those ingredients under less 
stringent criteria than currently proposed.
    One comment believed that requiring completion of a USP monograph 
should not be a reason to limit marketing to only under a final 
monograph. The comment acknowledged the importance of establishing USP 
monograph standards for OTC drug active ingredients, but objected to 
the requirement since the agency has not required USP monographs prior 
to the marketing of active ingredients already under consideration in 
the OTC drug review.
    Two comments disagreed with the agency's statement that marketing 
only under a final OTC drug monograph would allow manufacturers to 
avoid expensive relabeling when changes occur between the proposal and 
the final rule. One comment argued that it is not FDA's place to make 
business decisions for industry, which might in fact conclude that the 
marketing potential of the product is worth the risk. The comment added 
that all manufacturers of OTC drug products that are not yet subject to 
a final monograph face the same risk. The comments concluded that it 
should be left up to OTC manufacturers to determine whether the revenue 
and product recognition lost from any proposed restrictions on interim 
marketing would outweigh any potential costs of relabeling.
    The agency agrees that the interim marketing policy should be 
consistent between similar marketed products. Conditions that were 
reviewed by the OTC advisory review panels were allowed to be marketed 
during the course of the review if they had been marketed OTC in the 
United States when the review began. Conditions that were not marketed 
OTC in the United States when the review began could not be marketed 
until a panel's report was published in the Federal Register and the 
agency did not disagree with the panel's recommendations (see 21 CFR 
330.13). When a new condition was submitted for consideration after a 
panel's report was published and before a TFM was published, the agency 
usually addressed the status of that condition in the TFM. The agency 
stated in the TFM that marketing may begin with publication of the TFM 
or not until public comments were received on the TFM and a notice of 
enforcement policy was published in the Federal Register allowing 
marketing to begin. A similar procedure was used if a new condition was 
proposed for inclusion in a monograph after the TFM was published but 
before a final monograph was issued. Interim marketing was usually 
allowed because of the period of time projected before the final rule 
would issue.
    For those OTC drug monographs that are not final yet and where 
finalization is not imminent, after the agency has evaluated the 
comments to a proposed rule to include a new condition in a TFM as 
GRAS/E and the agency has not changed its position as a result of the 
comments, the agency will then publish a notice of enforcement policy 
to allow interim marketing. This enforcement notice will be similar to 
those used in the original OTC drug review and will allow marketing to 
begin pending completion of the final monograph subject to the risk 
that the agency may, prior to or in the final monograph, adopt a 
different position that could require relabeling, recall, or other 
regulatory action. However, interim marketing will not be allowed if 
USP-NF compendial monograph standards for the condition do not exist.
    For those conditions proposed to be included in a final OTC drug 
monograph or where a monograph for the condition does not exist and a 
new monograph is being proposed, interim marketing will not be allowed. 
It will first be necessary to seek public comment on the amendment to a 
final monograph or whether a new monograph should be established. The 
agency will not issue an enforcement notice under these circumstances 
because it takes the same amount of time and agency resources to 
resolve any outstanding issues and to proceed directly to issuance of a 
final rule.
    22. One comment expressed concern that the proposed eligibility 
criteria would require the submission of an NDA or TEA for even a 
slight variation of a monograph product. The comment cited examples 
that could trigger the requirement of an NDA or TEA, such as a simple 
combination of two well established OTC drug ingredients or immaterial 
changes in dosage form or concentration. The comment argued that a 
condition not authorized by a final monograph is not automatically a 
``new drug'' and the agency has the discretion under 21 CFR 310.3(h), 
to recognize that not all new conditions make a product ``new.'' The 
comment concluded that the agency should reaffirm its authority to 
authorize interim marketing for both pre-1972 and post-1972 non-
monograph conditions, consistent with its practice of issuing notices 
of enforcement policy for products that are the same as monograph 
products but for immaterial changes in such characteristics as dosage 
form or concentration.
    Variations from a monograph product or a condition being considered 
may or may not trigger the need for a TEA or NDA. A combination of two 
well established OTC drug ingredients that is not included in an 
existing OTC drug monograph or that has not been marketed in the United 
States would need a TEA. If one of the ingredients is marketed under an 
NDA, the product is considered a new drug and the combination would 
need an NDA. A TEA could be submitted for a change in concentration 
outside that included in an existing OTC drug monograph if that 
concentration has foreign marketing experience that meet the 
eligibility criteria. Information would be needed to support the safety 
and benefit of a higher concentration (as occurred with hydrocortisone 
for external analgesic use in the original OTC drug review) or the 
effectiveness of a lower concentration. If a condition marketed in one 
foreign country at one concentration is found eligible to be reviewed, 
another sponsor using a different concentration in another country may 
wish to submit a TEA and request that both concentrations be evaluated 
simultaneously.
    Most OTC drug monographs for oral products are not dosage form 
specific. Most OTC drug monographs for topical products also are not 
dosage form

[[Page 3069]]

specific and may state that the product is in a dosage form such as a 
cream, gel, lotion, or ointment. Some OTC drug monographs for topical 
products are dosage form specific and state that particular ingredients 
must be in a specific vehicle, e.g., in a suitable water soluble or 
oleaginous ointment base. Even this specific requirement would allow 
some flexibility for minor changes in the dosage form. Depending on the 
OTC drug monograph involved, any interim marketing policy for 
additional conditions in Sec. 330.14(h), will address the dosage form 
concentration, and other information of the condition being allowed 
interim marketing status.

E. Comments on Safety and Effectiveness

    23. One comment believed that the absence of adverse experience 
reporting systems in foreign countries for either drugs or cosmetics 
should not preclude a condition from being considered GRAS/E. The 
comment added that there is nothing in the act or FDA regulations that 
makes the absence of such information determinative of a condition's 
status.
    The agency agrees that the absence of an adverse experience 
reporting system in a foreign country for drugs or cosmetics does not 
necessarily mean that a condition cannot be GRAS/E. The GRAS/E 
determination will be based on the overall quality of the data and 
information presented to substantiate safety and effectiveness.

F. Comments on Specific Active Ingredients

    24. One comment requested that the agency reverse the category II 
status of the sunscreen ingredient 3-(4-methylbenzylidene)-camphor 
(Eusolex 6300) and permit its marketing upon publication of the final 
rule. The comment based this request upon its updated citizen petition 
that addresses the eligibility criteria in the proposed rule and an 
established USP monograph for 3-(4-methylbenzylidene)-camphor. The 
comment asserted that the agency's decision to place Eusolex 6300 in 
category II and the subsequent 20 year delay in addressing the foreign 
marketing data in their citizen petition raise serious legal concerns 
under section 10 of the Administrative Procedure Act.
    This comment is not directly related to this final rule. The agency 
discussed the status of this ingredient and its pending citizen 
petition in both the TMF (58 FR 28194 at 28210 to 28211, May 12, 1993) 
and the final monograph (64 FR 27666 at 27669 to 27670, May 21, 1999) 
for OTC sunscreen drug products, stating that a decision was needed on 
the use of foreign marketing data before this ingredient would be 
considered for inclusion in that monograph. With publication of this 
final rule, the sponsor may now submit a TEA for FDA to determine 
whether the condition is eligible for consideration in the OTC drug 
monograph system.

IV. Legal Authority

    This final rule amending the agency's regulations to include 
criteria for additional conditions and procedures for classifying OTC 
drugs as GRAS/E and not misbranded is authorized by the act. Since 
passage of the act in 1938, submission of an NDA has been required 
before marketing a new drug (21 U.S.C. 355). Section 201(p) of the act 
defines a new drug as:
    (1) Any drug * * * the composition of which is such that such 
drug is not generally recognized, among experts qualified by 
scientific training and experience to evaluate the safety and 
effectiveness of drugs, as safe and effective for use under the 
conditions prescribed, recommended, or suggested in the labeling 
thereof, * * * or (2) Any drug * * * the composition of which is 
such that such drug, as a result of investigations to determine its 
safety and effectiveness for use under such conditions, has become 
so recognized, but which has not, otherwise than in such 
investigations, been used to a material extent or for a material 
time under such conditions.
To market a new drug, an NDA must be submitted to, and approved by, FDA 
before marketing. Only drugs that are not new drugs may be covered by 
an OTC drug monograph. Section 701(a) of the act (21 U.S.C. 371(a)) 
authorizes FDA to issue regulations for the efficient enforcement of 
the act. FDA's regulations under part 330 outline the requirements for 
OTC human drugs that are GRAS/E and not misbranded. New Sec. 330.14 
adds additional requirements.

V. Analysis of Impacts

    FDA has examined the impacts of this final rule under Executive 
Order 12866, the Regulatory Flexibility Act (5 U.S.C. 601-612) (as 
amended by subtitle D of the Small Business Regulatory Fairness Act of 
1996 (Public Law 104-121)), and the Unfunded Mandates Reform Act of 
1995 (Public Law 104-4). Executive Order 12866 directs agencies to 
assess all costs and benefits of available regulatory alternatives and, 
when regulation is necessary, to select regulatory approaches that 
maximize net benefits (including potential economic, environmental, 
public health and safety, and other advantages; and distributive 
impacts; and equity). Under the Regulatory Flexibility Act, if a rule 
has a significant economic impact on a substantial number of small 
entities, an agency must analyze regulatory options that would minimize 
any significant impact of the rule on small entities. Section 202(a) of 
the Unfunded Mandates Reform Act requires that agencies prepare a 
written statement and economic analysis before proposing any rule that 
may result in an expenditure of $100 million (adjusted annually for 
inflation) in any one year by State, local, and tribal governments, in 
the aggregate, or by the private sector.
    The agency believes that this final rule is consistent with the 
regulatory philosophy and principles identified in the Executive order. 
Office of Management and Budget (OMB) has determined that this final 
rule is a significant regulatory action as defined by the Executive 
order and so is subject to review. Although the agency does not believe 
that this rule will have a significant economic impact on a substantial 
number of small entities, there is some uncertainty with respect to the 
estimated future impact. Thus, a regulatory flexibility analysis is 
presented below.

A. Regulatory Benefits

    The purpose of this final rule is to establish criteria and 
procedures by which OTC conditions may become eligible for 
consideration in the OTC drug monograph system. Currently, a sponsor 
wishing to introduce into the United States an OTC drug condition 
marketed solely in a foreign country must prepare and submit an NDA. 
Likewise, companies with OTC drugs initially marketed in the United 
States after the 1972 initiation of the OTC drug review must have an 
NDA. This final rule provides procedures for these NDA drugs to become 
eligible for inclusion in the OTC drug monograph system by first 
submitting a TEA to show marketing ``to a material extent'' and ``for a 
material time.'' Once determined eligible, safety and effectiveness 
data would be submitted and evaluated. This two-step process allows 
sponsors to demonstrate that eligibility criteria are met before having 
to expend resources to prepare safety and effectiveness data.
    The flexibility to market drug products under FDA's OTC drug 
monograph system provides an overall net benefit to the companies 
seeking to use this approach, as well as to the American public. One 
important benefit to sponsoring companies is the saving of NDA user 
fees. The Prescription Drug User Fee Act (21 U.S.C. 379h) requires a 
one-time application fee for each NDA submitted, and yearly product and 
establishment fees, as applicable, for each NDA approved. For FY 2000, 
these

[[Page 3070]]

fees are $285,740 (applications with clinical data), $19,959, and 
$141,971, respectively. Therefore, one-time user fees of $285,740, and 
ongoing fees of up to $161,930 ($19,959 + $141,971) are avoided if the 
company can establish that the condition should be included in an OTC 
drug monograph.
    Also, most manufacturers would experience a paperwork savings when 
seeking OTC drug monograph status instead of an NDA. For example, in 
most instances, the manufacturing controls information needed for 
submitting an NDA is not required for a monograph submission. Ongoing 
reporting requirements associated with periodic and annual reports are 
also avoided. Based on previous estimates of the paperwork hours needed 
to comply with these requirements and assuming a 33 percent reduction 
in paperwork activities, FDA estimates that eliminating manufacturing 
controls information from an application would bring a one-time savings 
of approximately 530 hours and an annual savings of 40 hours per 
submission. Applying the 1999 labor rate of $33.95 per hour for an 
industrial engineer (Ref. 3) (with a 40 percent adjustment for 
benefits), these one-time savings are approximately $17,994 (530 x 
$33.95/hour) per submission. Likewise, using the 1999 professional and 
managerial labor rate of $27.90 per hour (Ref. 3) (including a 40 
percent benefit rate), the ongoing savings from the elimination of 
periodic and annual reports would equal approximately $1,116 (40 x 
$27.90/hour) per product.
    Moreover, once a condition has been included in an OTC drug 
monograph, other companies could achieve similar benefits, as they 
would be permitted to enter the marketplace without submitting an NDA 
or an abbreviated NDA (ANDA), hereafter referred to as an application. 
These companies would also avoid the costs associated with achieving 
the inclusion of a condition in a monograph. In addition, these 
companies, as well as the sponsoring companies, would be permitted to 
market variations of a product, such as different product 
concentrations or dosage forms, if allowed by the monograph, saving the 
cost of an application or supplement when required.
    Consumers would also benefit from this rule. As conditions not 
previously marketed in the United States obtain OTC drug monograph 
status, a greater selection of OTC drug products would become 
available. In addition, competition from these additional products may 
restrain prices for the entire product class.

B. Regulatory Costs

    FDA estimates that the information needed for a TEA to meet the 
eligibility criteria for ``material time'' and ``material extent'' 
would take firms approximately 480 hours to prepare. Using the 1999 
professional and managerial labor rate of $27.90 per hour (Ref. 3) 
(including a 40 percent benefit rate), this cost amounts to 
approximately $13,392 (480 hours x $27.90/hour) per submission. The 
costs associated with requiring publication in an official compendium, 
where applicable, would be minimal as similar information is often 
prepared for publication in a foreign pharmacopeia and most companies 
already have such standards as part of their manufacturing quality 
control procedures.
    Considering the potential one-time cost savings described above of 
$303,734 ($285,740 + $17,994) associated with prescription drug user 
fees and reduced reporting requirements, FDA calculates a one-time net 
cost savings to industry of up to $290,342 ($303,734 - $13,392) per 
submission. Future yearly cost savings could total $21,075 ($19,959 + 
$1,116) per product and $141,971 per establishment if this were the 
establishment's only product. Accordingly, FDA estimates that if it 
receives 25 to 50 TEA submissions a year, the industry would save 
between $7.3 million and $14.5 million in one-time costs alone. The 
agency notes, however, that companies would submit conditions for OTC 
drug monograph status only where it would be profitable for them to do 
so.
    Since 1991, the agency has approved six requests for the inclusion 
of post-1972 U.S. OTC drug conditions in a monograph. Four of these 
requests consisted of a previously unapproved concentration, dosage 
form, dual claim, and product combination without OTC marketing 
experience. Similar conditions are not allowed under the final rule 
without a minimum of 5 continuous years of adequate OTC marketing 
experience. These manufacturers would need to either market their 
product under an application for 5 years in the United States or have 5 
years of sufficient marketing experience abroad to qualify for 
inclusion in a monograph. Accordingly, this rule could result in lost 
sales dollars for those few future applicants who, in the absence of 
this rule, might have successfully petitioned FDA to have a product 
with less than 5 years marketing experience included in a monograph. 
Likewise, other manufacturers would have to wait until either the 
agency includes the condition in a final monograph publication, or the 
agency evaluates the comments to a proposed rule to include a new 
condition in a TFM GRAS/E and then publishes a notice of enforcement 
policy allowing interim marketing, before they could market the product 
or a product variation without an application. Due to the limited 
number of requests approved to date, it is unlikely that many 
manufacturers will be significantly affected by these requirements.

C. Small Business Analysis

    Although the agency believes that this rule is unlikely to have a 
significant economic impact on a substantial number of small entities, 
FDA is uncertain about the extent of the future impact. Therefore, the 
following regulatory flexibility analysis has been prepared.
1. Description and Objective of the Final Rule
    As stated elsewhere in this preamble, the final rule makes it 
easier to market certain OTC drug products in the United States by 
amending current FDA regulations to include additional criteria and 
procedures by which OTC conditions may become eligible for 
consideration in the OTC drug monograph system. The additional criteria 
and procedures specify how OTC drugs initially marketed in the United 
States after the OTC drug review began in 1972 and OTC drugs without 
any U.S. marketing experience can meet the monograph eligibility 
requirements. Once eligibility has been determined for a particular 
condition, safety and effectiveness data are evaluated.
2. Description and Estimate of the Number of Small Entities
    Census data provide aggregate industry statistics on the number of 
manufacturers of pharmaceutical preparations, but do not distinguish 
between manufacturers of prescription and OTC drug products. According 
to the Small Business Administration (SBA), manufacturers of 
pharmaceutical preparations with 750 or fewer employees are considered 
small entities. The U.S. Census does not disclose data on the number of 
drug manufacturing firms by employment size, but between 92 and 96 
percent of drug manufacturing establishments, or approximately 650 
establishments, are small under this definition (Ref. 4). Although the 
number of firms that are small would be less than the number of 
establishments, FDA still concludes that the majority of pharmaceutical

[[Page 3071]]

preparation manufacturing firms are small entities.
    In addition, the agency finds that at least 400 firms manufacture 
U.S.-marketed OTC drug products. Using the SBA size designation, 31 
percent of these firms are large, 46 percent are small, and size data 
are not available for the remaining 23 percent. Therefore, 
approximately 184 to 276 of the affected manufacturing firms may be 
considered small. The agency cannot project how many of these OTC drug 
manufacturers would submit a TEA for consideration of an additional 
condition in the OTC drug monograph system.
3. Description of Reporting, Recordkeeping, and Other Compliance 
Requirements
    To demonstrate eligibility for consideration in the OTC drug 
monograph system, sponsors must submit data in a TEA showing that the 
condition has been marketed ``for a material time'' and ``to a material 
extent.'' All companies who choose to be considered in the OTC drug 
monograph system must submit these data. FDA expects that all 
sponsoring companies employ or have ready access to individuals who 
possess the skills necessary for this data preparation.
4. Identification of Federal Rules that Duplicate, Overlap, or Conflict 
With the Final Rule
    The agency is not aware of any relevant Federal rules that may 
duplicate, overlap, or conflict with the final rule.
5. Impact on Small Entities
    As described above, some manufacturers could be adversely affected 
by the 5-year material extent and material time requirements, causing a 
loss in future sales dollars. The agency cannot quantify this impact. 
However, based on the limited number of post-1972 conditions approved 
to date that would not have met the 5-year material extent and material 
time requirements, FDA believes that few manufacturers will be 
significantly affected.
6. Analysis of Alternatives
    In developing the requirements of this rule, the agency considered 
two alternatives. Initially, FDA contemplated a one-step evaluation 
process, where sponsors would submit safety and effectiveness data 
concurrently with their TEA. However, the agency decided that this 
process would be less efficient because it would require sponsoring 
companies to expend resources to prepare safety and effectiveness data 
before the agency determines whether eligibility criteria have been 
met.
    The agency also considered allowing manufacturers of post-1972 U.S. 
OTC drugs to market prior to inclusion in a final OTC drug monograph, 
as long as the agency had tentatively determined that the condition is 
GRAS/E. However, to allow for thorough public consideration of any 
safety and effectiveness issues that might arise before broad marketing 
of the condition begins under the OTC drug monograph system, the agency 
proposed that interim marketing should not be allowed under the OTC 
drug monograph system either for post-1972 U.S. conditions or for 
conditions with no previous U.S. marketing experience. Under this final 
rule, the agency has determined for those OTC drug monographs that are 
not final yet and where finalization is not imminent, after the agency 
has evaluated the comments to a proposed rule to include a new 
condition in a TFM as GRAS/E and the agency has not changed its 
position as a result of the comments, that it will then publish a 
notice of enforcement policy to allow interim marketing. This 
enforcement notice will be similar to those used in the original OTC 
drug review and will allow marketing to begin pending completion of the 
final monograph subject to the risk that the agency may, prior to or in 
the final monograph, adopt a different position that could require 
relabeling, recall, or other regulatory action. Interim marketing under 
these circumstances will also be dependent upon completion of official 
USP-NF monograph standards, as discussed above. For those conditions 
proposed to be included in a final OTC drug monograph or where a 
monograph for the condition does not exist and a new monograph is being 
proposed, interim marketing will not be allowed. Under these 
circumstances, the agency expects that it would take the same amount of 
time to include the condition in a final monograph as it would to 
publish an enforcement notice.
7. Response to Comments
    In response to public comment, the agency simplified the TEA 
criteria and decided to publish an enforcement notice to permit interim 
marketing when the finalization of the OTC drug monograph is not 
imminent, after the agency has evaluated the comments to a proposed 
rule to include a new condition in a TFM and the agency has not changed 
its position as a result of the comments. Several comments stated that 
the TEA is unduly burdensome because the required information is both 
unnecessarily detailed and difficult to compile. The final rule 
modifies how information should be provided on the number of dosage 
units sold, clarifies the criteria for determining marketing exposure, 
and revises the historical labeling requirements. These changes will 
further define the information that is necessary for the agency to 
determine whether the condition has been marketed to a material extent 
and for a material time. The agency still estimates that it will take 
480 hours to prepare a TEA.
    A number of comments disagreed with the proposed interim marketing 
policy. The comments asserted that interim marketing should be allowed, 
and that it should be left up to individual OTC manufacturers to 
determine whether the revenue and product recognition lost from the 
proposed restrictions on interim marketing would outweigh any potential 
costs of relabeling resulting from the final monograph. Therefore, for 
those OTC drug monographs that are not final yet and where finalization 
is not imminent, after the agency has evaluated the comments to a 
proposed rule to include a new condition in a TFM as GRAS/E, and the 
agency has not changed its position as a result of the comments, the 
agency will publish a notice of enforcement policy to allow interim 
marketing. This notice will allow marketing to begin pending completion 
of the final monograph subject to the risk that the agency may, prior 
to or in the final monograph, adopt a different position that could 
require relabeling, recall, or other regulatory action. Thus, in these 
cases, manufacturers can assess revenues and projected costs versus 
potential costs if relabeling, recall, or other regulatory action 
results from the final monograph. For those conditions proposed to be 
included in a final OTC drug monograph or where a monograph for the 
condition does not exist and a new monograph is being proposed, interim 
marketing still will not be allowed. However, under these 
circumstances, the agency expects that it would take the same amount of 
time to include the condition in a final monograph as it would to 
publish an enforcement notice. Therefore, OTC manufacturers should be 
able to begin marketing their product under a final rule in the same 
amount of time that they would have had to wait for the agency to issue 
an enforcement notice.
    Under the Unfunded Mandates Reform Act, FDA is not required to 
prepare a statement of costs and benefits for this final rule because 
this final rule is not expected to result in any 1-year

[[Page 3072]]

expenditure that would exceed $100 million adjusted for inflation.
    This analysis shows that the agency has considered the burden to 
small entities. Thus, this economic analysis, together with other 
relevant sections of this document, serves as the agency's final 
regulatory flexibility analysis, as required under the Regulatory 
Flexibility Act.

VI. 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.

VII. Paperwork Reduction Act of 1995

    This final rule contains collections of information which are 
subject to review by OMB under the Paperwork Reduction Act of 1995 (44 
U.S.C. 3501-3520). ``Collection of information'' includes any request 
or requirement that persons obtain, maintain, retain, or report 
information to the agency, or disclose information to a third party or 
to the public (44 U.S.C. 3502(3) and 5 CFR 1320.3(c)). The title, 
description, and respondent description of the information collection 
are shown below with an estimate of the annual reporting burden. 
Included in the estimate is the time for reviewing instructions, 
gathering and maintaining the data needed, and completing and reviewing 
the collection of information.
    In the proposal, FDA invited comments on: (1) Whether the proposed 
collection of information is necessary for proper performance of FDA's 
functions, including whether the information will have practical 
utility; (2) the accuracy of FDA's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (4) ways 
to minimize the burden of the collection of information on respondents, 
including the use of automated collection techniques, when appropriate, 
and other forms of information technology. The agency did not receive 
any specific comments on these items.
    Title: Additional Criteria and Procedures for Classifying Over-the-
Counter Drugs as Generally Recognized as Safe and Effective and Not 
Misbranded.
    Description: FDA is finalizing additional criteria and procedures 
by which OTC conditions may become eligible for consideration in the 
OTC drug monograph system. The criteria and procedures address how OTC 
drugs initially marketed in the United States after the OTC drug review 
began in 1972 and OTC drugs without any U.S. marketing experience could 
meet the statutory definition of marketing ``to a material extent'' and 
``for a material time'' and become eligible. If found eligible, the 
condition will be evaluated for general recognition of safety and 
effectiveness in accord with FDA's OTC drug monograph regulations.
    FDA received no comments on the Paperwork Reduction Act section of 
the proposed rule. However, OMB has requested, in its review of FDA's 
request for approval of the proposed information collection resulting 
from this rulemaking, that FDA look into the possibility of applying 
electronic collection techniques to this collection. There is no 
requirement in this rulemaking that sponsors submit TEAs 
electronically. However, the Center for Drug Evaluation and Research 
has issued the following guidances to facilitate the electronic 
submission of marketing applications: ``Guidance for Industry: 
Providing Regulatory Submissions in Electronic Format--General 
Considerations'' and ``Guidance for Industry: Providing Regulatory 
Submissions in Electronic Format--NDA's.'' These guidances were issued 
in January 1999 and are available at http://www.fda.gov/cder/guidance/index.htm. Also available at this Internet site is a document entitled 
``Example of an Electronic New Drug Application Submission.'' These 
guidances provide recommendations for submitting electronic submissions 
in the appropriate format. Sponsors should refer to the formatting 
recommendations in these guidances if they wish to submit a TEA 
electronically.
    Concerning the electronic submission of information to the Dockets 
Management Branch, over the last several months the Dockets Management 
Branch has been accepting comments electronically on specific dockets 
as part of a pilot program. An Internet address and an e-mail address 
have been set up to accept these comments. Parties may submit comments 
to the Dockets Management Branch through the Internet or e-mail at: 
http://www.fda.gov/ohrms/dockets/default.htm. Parties should then 
select ``submit electronic comments'' and follow the directions. Over 
the next several years, FDA expects to be able to accept electronic 
submissions of TEAs and safety and effectiveness data, which would 
eliminate the need for multiple paper copies.
    Current Sec. 330.10(a)(2) sets forth the requirements for the 
submission of data and information that FDA reviews to evaluate a drug 
for general recognition of safety and effectiveness. FDA receives 
approximately three safety and effectiveness submissions each year, and 
FDA estimates that it takes approximately 798 hours to prepare each 
submission.
    FDA anticipates that the number of safety and effectiveness 
submissions would increase to 93 annually as a result of this 
rulemaking. (Although FDA estimates that the number of TEAs submitted 
annually would be 50, the agency anticipates that 30 TEAs would be 
approved, and that this would result in approximately 3 safety and 
effectiveness submissions for each approved TEA.) The time required to 
prepare each safety and effectiveness submission would also increase as 
a result of two amendments to current Sec. 330.10(a)(2) under this 
final rule.
    One amendment revises items IV.A.3, IV.B.3, IV.C.3, V.A.3, V.B.3, 
and V.C.3 of the ``OTC Drug Review Information'' format and content 
requirements to add the words ``Identify common or frequently reported 
side effects'' after ``documented case reports.'' This revision 
clarifies current requirements for submitting documented case reports 
and only requires sponsors to ensure that side-effects information is 
identified in each submission. FDA estimates that it will take sponsors 
approximately 1 hour to comply with this requirement.
    A second amendment to current Sec. 330.10(a)(2) requires sponsors 
to submit an official USP-NF drug monograph for the active 
ingredient(s) or botanical drug substance(s), or a proposed standard 
for inclusion in an article to be recognized in an official USP-NF drug 
monograph for the active ingredient(s) or botanical drug substance(s). 
(This requirement is also stated in Sec. 330.14(f)(1).) FDA believes 
that the burden associated with this requirement will also be minimal 
because similar information may already have been prepared for previous 
publication in a foreign pharmacopeia, or companies will already have 
these standards as part of their quality control procedures for 
manufacturing the product. FDA estimates that the time required to 
photocopy this material will be approximately 1 hour.
    Thus, the time required for preparing each safety and effectiveness 
submission will increase by a total of 2 hours as a result of the 
amendments to Sec. 330.10(a)(2), increasing the approximate hours for 
each submission from 798 to 800 hours.

[[Page 3073]]

    Under Sec. 330.14(c), sponsors must submit a TEA when requesting 
that a condition subject to the regulation be considered for inclusion 
in the OTC drug monograph system. Based on the data provided and 
explained in the ``Analysis of Impacts'' in section V above, FDA 
estimates that approximately 50 TEAs will be submitted to FDA annually 
by approximately 25 sponsors, and the time required for preparing and 
submitting each TEA will be approximately 480 hours.
    Under Sec. 330.14(f)(2), sponsors are required to include in each 
safety and effectiveness submission all serious ADEs from each country 
where the condition has been or is currently marketed as a prescription 
or OTC drug product. Sponsors will be required to provide individual 
ADE reports along with a detailed summary of all serious ADEs and 
expected or frequently reported side effects for the condition. FDA 
believes that the burden associated with this requirement will be 
minimal because individual ADE reports are already required as part of 
the ``documented case reports'' in the ``OTC Drug Review Information'' 
under Sec. 330.10(a)(2). FDA estimates that the time required for 
preparing and submitting a detailed summary of all serious ADEs and 
expected or frequently reported side effects will be approximately 2 
hours.
    Due to the anticipated number of foreign conditions likely to seek 
immediate consideration in the OTC drug monograph system, the annual 
reporting burden estimated in table 1 below is the annual reporting for 
the first 3 years following publication of the final rule. FDA 
anticipates a reduced burden after this time period.
    Description of Respondents: Persons and businesses, including small 
businesses and manufacturers.

                                   Table 1.--Estimated Annual Reporting Burden
----------------------------------------------------------------------------------------------------------------
                                    No. of     Annual Frequency   Total Annual    Hours per
        21 CFR Section           Respondents     per Response      Responses       Response       Total Hours
----------------------------------------------------------------------------------------------------------------
330.10(a)(2) (safety and             93               1               93            800            74,400
 effectiveness submission)
330.14(c) (time and extent           25               2               50            480            24,000
 application)
330.14(f)(2) (adverse drug           90               1               90              2               180
 experience reports)
                                                                                              ------------------
  Total                                                                                            98,580
----------------------------------------------------------------------------------------------------------------

    The information collection provisions of the final rule have been 
submitted to OMB for review. Prior to the effective date of the final 
rule, FDA will publish a document in the Federal Register announcing 
OMB's decision to approve, modify, or disapprove the information 
collection provisions in the final rule. An agency may not conduct or 
sponsor, and a person is not required to respond to, a collection of 
information unless it displays a currently valid OMB control number.

VIII. References

    The following references are on display in the Dockets Management 
Branch (address above) and may be seen by interested persons between 9 
a.m. and 4 p.m., Monday through Friday.
    1. Comment No. C20, Docket No. 96N-0277, Dockets Management 
Branch.
    2. Comment No. C24, Docket No. 96N-0277, Dockets Management 
Branch.
    3. ``1999 Occupational Earnings Data,'' U.S. Department of 
Labor, Bureau of Labor Statistics, ftp://ftp.bls.gov/pub/special.requests/lf/att39.txt, April 26, 2000.
    4. U.S. Department of Commerce, Economics and Statistics 
Administration, Bureau of the Census, ``Industry Series Drugs,'' 
1992 Census of Manufactures, Table 4, p. 28C-12.

List of Subjects in 21 CFR Part 330

    Over-the-counter drugs.

    Therefore, under the Federal Food, Drug, and Cosmetic Act and under 
authority delegated to the Commissioner of Food and Drugs, 21 CFR part 
330 is amended as follows:

PART 330--OVER-THE-COUNTER (OTC) HUMAN DRUGS WHICH ARE GENERALLY 
RECOGNIZED AS SAFE AND EFFECTIVE AND NOT MISBRANDED

    1. The authority citation for 21 CFR part 330 continues to read as 
follows:

    Authority: 21 U.S.C. 321, 351, 352, 353, 355, 360, 371.

    2. Section 330.10 is amended as follows:
    a. In paragraph (a)(2) by adding the words ``or until the 
Commissioner places the panel's recommendations on public display at 
the office of the Dockets Management Branch'' at the end of the second 
sentence;
    b. In paragraph (a)(2) by adding the words ``Identify expected or 
frequently reported side effects.'' after the words ``Documented case 
reports.'' in items IV.A.3, IV.B.3, IV.C.3, V.A.3, V.B.3, and V.C.3 in 
the outline of ``OTC Drug Review Information''; and
    c. In paragraph (a)(2) by adding item VII at the end of the outline 
of ``OTC Drug Review Information'';
    d. In paragraph (a)(5) introductory text by removing the word 
``shall'' and adding in its place the word ``may'';
    e. In paragraphs (a)(5)(ii) and (a)(5)(iii) by removing the word 
``all'' from the first sentence;
    f. In paragraphs (a)(6)(i) and (a)(9) by removing the word ``is'' 
and adding in its place the words ``or a specific or specific OTC drugs 
are'';
    g. In paragraph (a)(6)(iv) by removing the word ``quintuplicate'' 
and by adding in its place ``triplicate'' in the forth full sentence, 
by removing the words ``during regular working hours'' and by adding in 
their place ``between the hours of 9 a.m. and 4 p.m.'' in the sixth 
full sentence, and by adding two sentences at the end.
    h. In paragraph (a)(7)(i) by revising the first and second 
sentences;
    i. In paragraph (a)(7)(ii) by removing the first and second 
sentences and by adding three sentences in their places;
    j. In paragraph (a)(10)(i) and (a)(10)(iii) by adding in the first 
sentence a comma and the phrase ``in response to any other notice 
published in the Federal Register,'' after the phrase ``paragraph 
(a)(2) of this section''; and
    k. In paragraph (a)(12)(i) in the fourth sentence by removing the 
number ``60'' and by adding in its place the number ``90'' and by 
removing the word ``quadruplicate'' and by adding in its place the word 
``triplicate'' to read as follows:


Sec. 330.10  Procedures for classifying OTC drugs as generally 
recognized as safe and effective and not misbranded, and for 
establishing monographs.

    (a)  * * * 
    (2)  * * * 

[[Page 3074]]

OTC DRUG REVIEW INFORMATION

* * * * *
    VII. An official United States Pharmacopeia (USP)-National 
Formulary (NF) drug monograph for the active ingredient(s) or botanical 
drug substance(s), or a proposed standard for inclusion in an article 
to be recognized in an official USP-NF drug monograph for the active 
ingredient(s) or botanical drug substance(s). Include information 
showing that the official or proposed compendial monograph for the 
active ingredient or botanical drug substance is consistent with the 
active ingredient or botanical drug substance used in the studies 
establishing safety and effectiveness and with the active ingredient or 
botanical drug substance marketed in the OTC product(s) to a material 
extent and for a material time. If differences exist, explain why.
* * * * *
    (6)  * * *
    (iv)  * * *  Alternatively, the Commissioner may satisfy this 
requirement by placing the panel's recommendations and the data it 
considered on public display at the office of the Dockets Management 
Branch and publishing a notice of their availability in the Federal 
Register. This notice of availability may be included as part of the 
tentative order in accord with paragraph (a)(7) of this section.
    (7)  * * *
    (i) After reviewing all comments, reply comments, and any new data 
and information or, alternatively, after reviewing a panel's 
recommendations, the Commissioner shall publish in the Federal Register 
a tentative order containing a monograph establishing conditions under 
which a category of OTC drugs or specific OTC drugs are generally 
recognized as safe and effective and not misbranded. Within 90 days, 
any interested person may file with the Dockets Management Branch, Food 
and Drug Administration, written comments or written objections 
specifying with particularity the omissions or additions requested. * * 
*
    (ii) The Commissioner may also publish in the Federal Register a 
separate tentative order containing a statement of those active 
ingredients reviewed and proposed to be excluded from the monograph on 
the basis of the Commissioner's determination that they would result in 
a drug product not being generally recognized as safe and effective or 
would result in misbranding. This order may be published when no 
substantive comments in opposition to the panel report or new data and 
information were received by the Food and Drug Administration under 
paragraph (a)(6)(iv) of this section or when the Commissioner has 
evaluated and concurs with a panel's recommendation that a condition be 
excluded from the monograph. Within 90 days, any interested person may 
file with the Dockets Management Branch, Food and Drug Administration, 
written objections specifying with particularity the provision of the 
tentative order to which objection is made. * * *
* * * * *
    3. Section 330.13 is amended by adding paragraph (e) to read as 
follows:


Sec. 330.13  Conditions for marketing ingredients recommended for over-
the-counter (OTC) use under the OTC drug review.

* * * * *
    (e) This section applies only to conditions under consideration as 
part of the OTC drug review initiated on May 11, 1972, and evaluated 
under the procedures set forth in Sec. 330.10. Section 330.14(h) 
applies to the marketing of all conditions under consideration and 
evaluated using the criteria and procedures set forth in Sec. 330.14.
    4. Section 330.14 is added to subpart B to read as follows:


Sec. 330.14  Additional criteria and procedures for classifying OTC 
drugs as generally recognized as safe and effective and not misbranded.

    (a) Introduction. This section sets forth additional criteria and 
procedures by which over the counter (OTC) drugs initially marketed in 
the United States after the OTC drug review began in 1972 and OTC drugs 
without any U.S. marketing experience can be considered in the OTC drug 
monograph system. This section also addresses conditions regulated as a 
cosmetic or dietary supplement in a foreign country that would be 
regulated as OTC drugs in the United States. For purposes of this 
section, ``condition'' means an active ingredient or botanical drug 
substance (or a combination of active ingredients or botanical drug 
substances), dosage form, dosage strength, or route of administration, 
marketed for a specific OTC use, except as excluded in paragraph (b)(2) 
of this section. For purposes of this part, ``botanical drug 
substance'' means a drug substance derived from one or more plants, 
algae, or macroscopic fungi, but does not include a highly purified or 
chemically modified substance derived from such a source.
    (b) Criteria. To be considered for inclusion in the OTC drug 
monograph system, the condition must meet the following criteria:
    (1) The condition must be marketed for OTC purchase by consumers. 
If the condition is marketed in another country in a class of OTC drug 
products that may be sold only in a pharmacy, with or without the 
personal involvement of a pharmacist, it must be established that this 
marketing restriction does not indicate safety concerns about the 
condition's toxicity or other potentiality for harmful effect, the 
method of its use, or the collateral measures necessary to its use.
    (2) The condition must have been marketed OTC for a minimum of 5 
continuous years in the same country and in sufficient quantity, as 
determined in paragraphs (c)(2)(ii), (c)(2)(iii), and (c)(2)(iv) of 
this section. Depending on the condition's extent of marketing in only 
one country with 5 continuous years of marketing, marketing in more 
than one country may be necessary.
    (c) Time and extent application. Certain information must be 
provided when requesting that a condition subject to this section be 
considered for inclusion in the OTC drug monograph system. The 
following information must be provided in the format of a time and 
extent application (TEA):
    (1) Basic information about the condition that includes a 
description of the active ingredient(s) or botanical drug substance(s), 
pharmacologic class(es), intended OTC use(s), OTC strength(s) and 
dosage form(s), route(s) of administration, directions for use, and the 
applicable existing OTC drug monograph(s) under which the condition 
would be marketed or the request and rationale for creation of a new 
OTC drug monograph(s).
    (i) A detailed chemical description of the active ingredient(s) 
that includes a full description of the drug substance, including its 
physical and chemical characteristics, the method of synthesis (or 
isolation) and purification of the drug substance, and any 
specifications and analytical methods necessary to ensure the identity, 
strength, quality, and purity of the drug substance.
    (ii) For a botanical drug substance(s), a detailed description of 
the botanical ingredient (including proper identification of the plant, 
plant part(s), alga, or macroscopic fungus used; a certificate of 
authenticity; and information on the grower/supplier, growing 
conditions, harvest location and harvest time); a qualitative 
description (including the name, appearance, physical/chemical 
properties, chemical constituents, active constituent(s) (if known), 
and biological activity (if known)); a quantitative description of the 
chemical

[[Page 3075]]

constituents, including the active constituent(s) or other chemical 
marker(s) (if known and measurable); the type of manufacturing process 
(e.g., aqueous extraction, pulverization); and information on any 
further processing of the botanical substance (e.g., addition of 
excipients or blending).
    (iii) Reference to the current edition of the U.S. Pharmacopeia 
(USP)-National Formulary (NF) or foreign compendiums may help satisfy 
the requirements in this section.
    (2) A list of all countries in which the condition has been 
marketed. Include the following information for each country. (For a 
condition that has been marketed OTC in 5 or more countries with a 
minimum of 5 continuous years of marketing in at least one country, the 
sponsor may submit information in accordance with paragraph (c)(4) of 
this section):
    (i) How the condition has been marketed (e.g., OTC general sales 
direct-to-consumer; sold only in a pharmacy, with or without the 
personal involvement of a pharmacist; dietary supplement; or cosmetic). 
If the condition has been marketed as a nonprescription pharmacy-only 
product, establish that this marketing restriction does not indicate 
safety concerns about its toxicity or other potentiality for harmful 
effect, the method of its use, or the collateral measures necessary to 
its use.
    (ii) The cumulative total number of dosage units (e.g., tablets, 
capsules, ounces) sold for each dosage form of the condition. 
Manufacturers or suppliers of OTC active ingredients may provide dosage 
unit information as the total weight of active ingredient sold. List 
the various package sizes for each dosage form in which the condition 
is marketed OTC. Provide an estimate of the minimum number of potential 
consumer exposures to the condition using one of the following 
calculations:
    (A) Divide the total number of dosage units sold by the number of 
dosage units in the largest package size marketed, or
    (B) Divide the total weight of the active ingredient sold by the 
total weight of the active ingredient in the largest package size 
marketed.
    (iii) A description of the population demographics (percentage of 
various racial/ethnic groups) and the source(s) from which this 
information has been compiled, to ensure that the condition's use(s) 
can be reasonably extrapolated to the U.S. population.
    (iv) If the use pattern (i.e., how often it is to be used 
(according to the label) and for how long) varies between countries 
based on the condition's packaging and labeling, or changes in use 
pattern have occurred over time in one or more countries, describe the 
use pattern for each country and explain why there are differences or 
changes.
    (v) A description of the country's system for identifying adverse 
drug experiences, especially those found in OTC marketing experience, 
including method of collection if applicable.
    (3) A statement of how long the condition has been marketed in each 
country and how long the current product labeling has been in use, 
accompanied by a copy of the current product labeling. All labeling 
that is not in English must be translated to English in accordance with 
Sec. 10.20(c)(2) of this chapter. State whether the current product 
labeling has or has not been authorized, accepted, or approved by a 
regulatory body in each country where the condition is marketed.
    (4) For a condition that has been marketed OTC in five or more 
countries with a minimum of 5 continuous years of marketing in at least 
one country, the sponsor may select at least five of these countries 
from which to submit information in accord with paragraphs (c)(2)(i) 
through (c)(2)(iv) of this section. Selected countries must include the 
country with a minimum of 5 continuous years of OTC marketing, 
countries that have the longest duration of marketing, and countries 
having the most support for extent of marketing, i.e., a large volume 
of sales with cultural diversity among users of the product. If the 
condition meets these criteria in countries listed in section 
802(b)(1)(A) of the Federal Food, Drug, and Cosmetic Act, some of these 
countries should be included among the five selected. Sponsors should 
provide information from more than five countries if they believe that 
it is needed to support eligibility. Sponsors should explain the basis 
for the countries selected in the TEA.
    (5) A list of all countries where the condition is marketed only as 
a prescription drug and the reasons why its marketing is restricted to 
prescription in these countries.
    (6) A list of all countries in which the condition has been 
withdrawn from marketing or in which an application for OTC marketing 
approval has been denied. Include the reasons for such withdrawal or 
application denial.
    (7) The information requested in paragraphs (c)(2), (c)(2)(i) 
through (c)(2)(iv), and (c)(3) of this section must be provided in a 
table format. The labeling required by paragraph (c)(3) of this section 
must be attached to the table.
    (8) For OTC drugs that have been marketed for more than 5 years in 
the United States under a new drug application, the information 
requested in paragraphs (c)(2)(i), (c)(2)(iii), (c)(2)(v), (c)(3), and 
(c)(5) of this section need not be provided.
    (d) Submission of information; confidentiality. The sponsor must 
submit three copies of the TEA to the Central Document Room, 5630 
Fishers Lane, rm. 1061, Rockville, MD 20852. The Food and Drug 
Administration will handle the TEA as confidential until such time as a 
decision is made on the eligibility of the condition for consideration 
in the OTC drug monograph system. If the condition is found eligible, 
the TEA will be placed on public display in the Dockets Management 
Branch after deletion of information deemed confidential under 18 
U.S.C. 1905, 5 U.S.C. 552(b), or 21 U.S.C. 331(j). Sponsors must 
identify information that is considered confidential under these 
statutory provisions. If the condition is not found eligible, the TEA 
will not be placed on public display, but a letter from the agency to 
the sponsor stating why the condition was not found acceptable will be 
placed on public display in the Dockets Management Branch.
    (e) Notice of eligibility. If the condition is found eligible, the 
agency will publish a notice of eligibility in the Federal Register and 
provide the sponsor and other interested parties an opportunity to 
submit data to demonstrate safety and effectiveness. When the notice of 
eligibility is published, the agency will place the TEA on public 
display in the Dockets Management Branch.
    (f) Request for data and views. The notice of eligibility shall 
request interested persons to submit published and unpublished data to 
demonstrate the safety and effectiveness of the condition for its 
intended OTC use(s). These data shall be submitted to a docket 
established in the Dockets Management Branch and shall be publicly 
available for viewing at that office, except data deemed confidential 
under 18 U.S.C. 1905, 5 U.S.C. 552(b), or 21 U.S.C. 331(j). Data 
considered confidential under these provisions must be clearly 
identified. Any proposed compendial standards for the condition shall 
not be considered confidential. The safety and effectiveness 
submissions shall include the following:
    (1) All data and information listed in Sec. 330.10(a)(2) under the 
outline ``OTC Drug Review Information,'' items III through VII.
    (2) All serious adverse drug experiences as defined in 
Secs. 310.305 and 314.80 of this chapter, from each

[[Page 3076]]

country where the condition has been or is currently marketed as a 
prescription drug or as an OTC drug or product. Provide individual 
adverse drug experience reports (FDA Form 3500A or equivalent) along 
with a summary of all serious adverse drug experiences and expected or 
frequently reported side effects for the condition. Individual reports 
that are not in English must be translated to English in accordance 
with Sec. 10.20(c)(2) of this chapter.
    (g) Administrative procedures. The agency may use an advisory 
review panel to evaluate the safety and effectiveness data in accord 
with the provisions of Sec. 330.10(a)(3). Alternatively, the agency may 
evaluate the data in conjunction with the advisory review panel or on 
its own without using an advisory review panel. The agency will use the 
safety, effectiveness, and labeling standards in Sec. 330.10(a)(4)(i) 
through (a)(4)(vi) in evaluating the data.
    (1) If the agency uses an advisory review panel to evaluate the 
data, the panel may submit its recommendations in its official minutes 
of meeting(s) or by a report under the provisions of Sec. 330.10(a)(5).
    (2) The agency may act on an advisory review panel's 
recommendations using the procedures in Secs. 330.10(a)(2) and 
330.10(a)(6) through (a)(10).
    (3) If the condition is initially determined to be generally 
recognized as safe and effective for OTC use in the United States, the 
agency will propose to include it in an appropriate OTC drug 
monograph(s), either by amending an existing monograph(s) or 
establishing a new monograph(s), if necessary.
    (4) If the condition is initially determined not to be generally 
recognized as safe and effective for OTC use in the United States, the 
agency will inform the sponsor and other interested parties who have 
submitted data of its determination by letter, a copy of which will be 
placed on public display in the docket established in the Dockets 
Management Branch. The agency will publish a notice of proposed 
rulemaking to include the condition in Sec. 310.502 of this chapter.
    (5) Interested parties will have an opportunity to submit comments 
and new data. The agency will subsequently publish a final rule (or 
reproposal if necessary) in the Federal Register.
    (h) Marketing. A condition submitted under this section for 
consideration in the OTC drug monograph system may be marketed in 
accordance with an applicable final OTC drug monograph(s) only after 
the agency determines that the condition is generally recognized as 
safe and effective and includes it in the appropriate OTC drug final 
monograph(s), and the condition complies with paragraph (i) of this 
section. When an OTC drug monograph has not been finalized and 
finalization is not imminent, after the agency has evaluated the 
comments to a proposed rule to include a new condition in a tentative 
final monograph as generally recognized as safe and effective and the 
agency has not changed its position as a result of the comments, and 
the condition complies with paragraph (i) of this section, the agency 
may publish a notice of enforcement policy that allows marketing to 
begin pending completion of the final monograph subject to the risk 
that the agency may, prior to or in the final monograph, adopt a 
different position that could require relabeling, recall, or other 
regulatory action.
    (i) Compendial monograph. Any active ingredient or botanical drug 
substance included in a final OTC drug monograph or the subject of an 
enforcement notice described in paragraph (h) of this section must be 
recognized in an official USP-NF drug monograph that sets forth its 
standards of identity, strength, quality, and purity. Sponsors must 
include an official or proposed compendial monograph as part of the 
safety and effectiveness data submission listed in Sec. 330.10(a)(2) 
under item VII of the outline entitled ``OTC DRUG REVIEW INFORMATION.''

    Dated: January 11, 2001.
Margaret M. Dotzel,
Associate Commissioner for Policy.
[FR Doc. 02-1457 Filed 1-22-02; 8:45 am]
BILLING CODE 4160-01-S