[Federal Register Volume 69, Number 134 (Wednesday, July 14, 2004)]
[Rules and Regulations]
[Pages 42256-42274]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-15881]



[[Page 42255]]

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Part II





Department of Health and Human Services





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Food and Drug Administration



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21 CFR Parts 189 and 700



Use of Materials Derived From Cattle in Human Food and Cosmetics; and 
Recordkeeping Requirements for Human Food and Cosmetics Manufactured 
From, Processed With, or Otherwise Containing, Material From Cattle; 
Final Rule and Proposed Rule

  Federal Register / Vol. 69, No. 134 / Wednesday, July 14, 2004 / 
Rules and Regulations  

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

21 CFR Parts 189 and 700

[Docket No. 2004N-0081]
RIN-0910-AF47


Use of Materials Derived From Cattle in Human Food and Cosmetics

AGENCY: Food and Drug Administration, HHS.

ACTION: Interim final rule.

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SUMMARY: The Food and Drug Administration (FDA) is issuing an interim 
final rule (interim final rule) to prohibit the use of certain cattle 
material, to address the potential risk of bovine spongiform 
encephalopathy (BSE), in human food, including dietary supplements, and 
cosmetics. Prohibited cattle materials include specified risk 
materials, small intestine of all cattle, material from nonambulatory 
disabled cattle, material from cattle not inspected and passed for 
human consumption, and mechanically separated (MS)(Beef). Specified 
risk materials are the brain, skull, eyes, trigeminal ganglia, spinal 
cord, vertebral column (excluding the vertebrae of the tail, the 
transverse processes of the thoracic and lumbar vertebrae, and the 
wings of the sacrum), and dorsal root ganglia of cattle 30 months and 
older; and the tonsils and distal ileum of the small intestine of all 
cattle. Prohibited cattle materials do not include tallow that contains 
no more than 0.15 percent hexane-insoluble impurities and tallow 
derivatives. FDA is taking this action in response to the finding of an 
adult cow, imported from Canada, that tested positive for BSE in the 
State of Washington. This action is consistent with the recent interim 
final rule issued by the U.S. Department of Agriculture (USDA) 
declaring specified risk materials and the carcasses and parts of 
nonambulatory disabled cattle to be inedible, unfit for human food, and 
prohibiting their use as human food and requiring that the entire small 
intestine be removed and disposed of as inedible. This action will 
minimize human exposure to materials that scientific studies have 
demonstrated are highly likely to contain the BSE agent in cattle 
infected with the disease. Scientists believe that the human disease 
variant Creutzfeldt-Jakob disease (vCJD) is likely caused by the 
consumption of products contaminated with the agent that causes BSE. 
Also in this issue of the Federal Register, FDA is proposing to require 
that manufacturers and processors of human food and cosmetics that are 
manufactured from, processed with, or otherwise contain material from 
cattle establish and maintain records sufficient to demonstrate that 
the food and cosmetics are in compliance with this interim final rule.

DATES: The interim final rule is effective on July 14, 2004. Submit 
written or electronic comments by October 12, 2004. The Director of the 
Office of the Federal Register approves the incorporation by reference 
in accordance with 5 U.S.C. 552(a) and 1 CFR part 51 of certain 
publications in 21 CFR 189.5 and 700.27 as of July 14, 2004.

ADDRESSES: You may submit comments, identified by Docket No. 2004N-
0081, by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Agency Web site: http://www.fda.gov/dockets/ecomments. 
Follow the instructions for submitting comments on the agency Web site.
     E-mail: [email protected]. Include Docket No. 2004N-
0081 and or RIN number RIN-0910-AF47 in the subject line of your e-mail 
message.
     FAX: 301-827-6870.
     Mail/Hand delivery/Courier [For paper, disk, or CD-ROM 
submissions]: Division of Dockets Management, 5630 Fishers Lane, rm. 
1061, Rockville, MD 20852.
    Instructions: All submissions received must include the agency name 
and Docket No. or Regulatory Information Number (RIN) for this 
rulemaking. All comments received will be posted without change to 
http://www.fda.gov/dockets/ecomments, including any personal 
information provided. For detailed instructions on submitting comments 
and additional information on the rulemaking process, see section V in 
the SUPPLEMENTARY INFORMATION section of this document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.fda.gov/dockets/ecomments and/or 
the Division of Dockets Management, 5630 Fishers Lane, rm. 1061, 
Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Rebecca Buckner, Center for Food 
Safety and Applied Nutrition (HFS-306), Food and Drug Administration, 
5100 Paint Branch Pkwy., College Park, MD 20740, 301-436-1486.

SUPPLEMENTARY INFORMATION:

I. Background

    On January 26, 2004, the Department of Health and Human Services 
announced new safeguards to strengthen existing firewalls against 
transmission of bovine spongiform encephalopathy (BSE) in the United 
States. This interim final rule, will protect the food and cosmetic 
supply from materials that may carry a risk of transmitting BSE. 
Consumption of products contaminated with agent that causes BSE has 
been linked to a human disease. The United States is currently 
protected from the spread of BSE by import controls, increased 
surveillance for the disease in the cattle population, FDA's 1997 
ruminant feed regulation, and the United States Department of 
Agriculture's (USDA's) ban on specified risk materials and certain 
other cattle material in human food. This interim final rule 
complements USDA's ban for FDA-regulated human food and cosmetics.

A. Transmissible Spongiform Encephalopathies

    Transmissible spongiform encephalopathies (TSEs) are fatal 
neurodegenerative disorders, which have been identified in humans and a 
number of animal species (e.g., cattle, sheep, goats, elk, deer, cats, 
and mink), but primarily in ruminants (cattle, sheep, elk, deer). TSEs 
are characterized by a long incubation period, then a shorter course of 
neurological symptoms, followed by death (Ref. 1). Postmortem 
histopathology of the brain tissue from humans and animals with TSEs is 
characterized by a sponge-like appearance of the brain and deposits of 
abnormal forms of certain cell-associated proteins (normal prion 
proteins) in the brain. In some TSEs, deposits of abnormal prion 
proteins are detected in other nervous and non-nervous tissues, such as 
the spinal cord, peripheral nerves, intestine, spleen, lymph nodes, and 
bone marrow (Refs. 2 to 6).
    TSEs in humans include sporadic CJD, variant Creutzfeldt-Jakob 
disease (vCJD), Gerstmann-Straussler-Scheinker syndrome, kuru, fatal 
familial insomnia, and sporadic fatal insomnia (Ref. 7). Nonhuman TSEs 
include BSE in cattle, scrapie in sheep and goats, transmissible mink 
encephalopathy (TME) in mink, feline spongiform encephalopathy (FSE) in 
cats, and chronic wasting disease (CWD) in deer and elk (Ref. 7). 
Scrapie and CWD occur, and TME has occurred, in the United States. On 
December 23, 2003, USDA diagnosed BSE in an adult cow

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in the United States that had come from Canada.
    The pathogenesis of TSEs is poorly understood. Resistance of TSE 
agents to physical and chemical treatments that would destroy most 
nucleic acids makes conventional micro-organisms, such as bacteria and 
viruses, less likely causes (Ref. 8). The prion theory suggests that 
the infectious agents of TSEs are abnormally folded forms of normal 
prion proteins, and is the most widely accepted explanation (Ref. 9). 
Normal prion protein genes are found widely in nature. In mammals, 
normal prion proteins are primarily expressed in neurons, but also can 
be found in other tissues in lower concentrations, depending on the 
mammalian species (Ref. 10). It is not well understood how the abnormal 
folding of prion proteins occurs, why hosts cannot efficiently dispose 
of or develop immunity to these proteins, and what factors cause some 
TSEs.
    The current lack of an antemortem diagnostic test for TSEs in 
either humans or animals limits surveillance for these diseases, 
studies of disease pathogenesis, and other research efforts. Diagnosis 
is confirmed by special post-mortem examination of brain tissue by 
identification of abnormal prion proteins in advanced stages of the 
disease. At earlier stages of disease development, abnormal prion 
proteins may not yet be present or are undetectable in brain tissue. 
Presently, there are no effective treatments for TSEs, and all are 
invariably fatal (Ref. 1).

B. Bovine Spongiform Encephalopathy

    BSE is a TSE of cattle with a long incubation period (2 to 8 
years), most likely acquired following consumption of an animal product 
containing the infectious BSE agent (Refs. 11 and 12). The British 
Ministry of Agriculture, Fisheries and Food (now known as the 
Department for Environment, Food, and Rural Affairs) first recognized 
BSE as a distinct disease in November 1986. The clinical signs of BSE 
include behavioral, gait, and postural abnormalities. The disease 
usually presents in cattle observed to have increased apprehension, 
increased reaction to sound and touch, and a swaying gait. These signs 
are accompanied by subtle changes in the normal behavior of the cow, 
such as separation from the herd while at pasture, disorientation, 
staring, and excessive licking of the nose or flanks. The disease 
progresses to stumbling and falling, and ends with seizures, coma, and 
death (Ref. 13).
    Epidemiological studies have characterized the outbreak of BSE in 
the United Kingdom as a prolonged epidemic arising at various 
locations, with all occurrences due to a common source, and have 
suggested that feed contaminated by a TSE agent was the cause of the 
disease outbreak (Ref. 14). The subsequent spread of BSE, however, is 
associated with the feeding of meat-and-bone-meal from rendered BSE-
infected cattle to non-infected cattle (Ref. 14). It appears likely 
that the BSE agent was transmitted among cattle at an increasing rate 
by ruminant-to-ruminant feeding until the United Kingdom ban on such 
practices went into effect in 1988 (Ref. 11). The United Kingdom 
instituted a ruminant-to-ruminant feed ban to stop the cycle of 
infection, restrict the geographic spread of the disease, and eliminate 
potential sources of new infections. Since BSE was first identified in 
the United Kingdom, approximately 185,000 cattle have been diagnosed 
with the disease there (Ref. 15). The precautionary slaughter of 
millions of British cows and increasingly stringent prohibitions on 
certain animal feeding practices appear to have slowed, but not 
eradicated, the BSE epidemic in the United Kingdom. In 1992 (the peak 
year of the epidemic), there were over 35,000 cases of BSE in the 
United Kingdom; in 2003, there were approximately 458 cases (Ref. 15).
    The measures used to control and prevent the spread of BSE in the 
United Kingdom were too slowly developed or too poorly enforced to 
prevent the occurrence of BSE in cattle in other countries to which the 
United Kingdom had shipped BSE-infected cattle or cattle feed (Ref. 
11). In addition to the United Kingdom, BSE has been detected in non-
imported cattle in Austria, Belgium, Canada, the Czech Republic, 
Denmark, Finland, France, Germany, Greece, Israel, Italy, Japan, 
Liechtenstein, Luxembourg, the Netherlands, Poland, Portugal, the 
Republic of Ireland, Slovakia, Slovenia, Spain, and Switzerland (Ref. 
15). On December 23, 2003, USDA diagnosed a positive case of BSE in an 
adult Holstein cow, born in Canada, in the State of Washington.

C. Creutzfeldt-Jakob Disease and Variant Creutzfeldt-Jakob Disease

    CJD is a sporadic disease of humans that exists throughout the 
world with an annual incidence of approximately one case per million 
population (Ref. 9). The highest death rates in the United States and 
the United Kingdom occur in individuals between the ages of 60 and 70 
(Ref. 16). Death generally occurs after less than a year of progressive 
neurological deterioration (Ref. 9). Early symptoms typically include 
changes in sleeping and eating patterns, followed by inappropriate 
behavior and eventual dementia, lack of coordination, and myoclonic 
spasms. CJD is always fatal (Ref. 16). The cause of sporadic CJD is not 
fully understood, but genetic susceptibility may play a role (Ref. 9). 
CJD has been inadvertently transmitted between humans during medical 
treatment or diagnostic procedures via contaminated neurosurgical 
instruments, transplants of dura mater and corneas, injection of 
pituitary extract, and cross-contamination from medical personnel who 
handled tissues from patients with CJD (Ref. 9).
    In April 1996, British scientists reported a previously undetected 
new variant of CJD (vCJD) in young patients, with symptoms somewhat 
different from sporadic CJD (Refs. 17 and 18). All cases of vCJD had 
histopathologic evidence of spongiform changes in the brain, but also 
showed formation of ``florid'' plaques (a core of amyloid protein with 
surrounding halos of vacuoles) not typically seen in other forms of CJD 
(Ref. 9). Clinically, vCJD usually begins with a psychiatric 
presentation, such as depression, anxiety, nightmares or 
hallucinations. These symptoms are followed by memory impairment, then 
dementia in the late stages. The clinical course may last up to 2 years 
before death occurs (Ref. 19).
    Because scientific evidence suggests that the presence and 
infectivity of abnormal prion proteins in vCJD share some 
characteristics with those abnormal prion proteins found in cattle with 
BSE, scientists have concluded that exposure to the BSE agent is the 
most plausible explanation for the occurrence of vCJD (Refs. 20 to 23). 
Monkeys (genetically the closest animal model to humans) inoculated 
with samples of brain from BSE-infected cattle have been found to 
develop a TSE that is histopathologically similar to vCJD (Ref. 24), as 
have mice inoculated or fed with BSE-infected tissue (Ref. 25). Studies 
have shown that abnormal prion proteins from vCJD patients are 
molecularly similar to abnormal prion proteins from BSE-infected 
cattle, but different from abnormal prion proteins from patients with 
CJD (Ref. 19). Although the exact route of exposure is not known, most 
scientists believe that vCJD in humans is caused by consumption of 
cattle products contaminated with the agent that causes BSE (Refs. 16, 
26, and 27).
    Since 1996, approximately 150 probable and confirmed cases of vCJD 
have been reported in the United Kingdom. In addition, one case of vCJD 
each has been reported in Ireland and

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Canada, both of which are believed to be related to BSE exposure in the 
United Kingdom. The one reported case of vCJD in the United States is 
also believed to be related to United Kingdom BSE exposure (Ref. 10). 
In addition, there have been seven vCJD cases in France and one in 
Italy (Ref. 10). Because the incubation period for vCJD in humans may 
range from 5 to 20 years, some epidemiological models have projected 
that many more (600-3000) cases of vCJD caused by consumption of BSE-
contaminated cattle products may occur in the United Kingdom in the 
future (Ref. 28).

D. BSE Risk Assessments

    In 1998, USDA asked the Harvard Center for Risk Analysis (HCRA) and 
the Center for Computational Epidemiology at Tuskegee University to 
evaluate United States measures to prevent the spread of BSE to animals 
and humans if it were to occur in this country. The Harvard-Tuskegee 
risk assessment (referred to below as the Harvard-Tuskegee study) was 
published in November 2001, revised in 2003, and determined that the 
United States was highly resistant to any proliferation of BSE or a 
similar disease (Ref. 29). The risk assessment model also demonstrated 
that certain new control measures could reduce the small risk even 
further.
    The Harvard-Tuskegee study involved a probabilistic simulation 
model to determine the consequences of introducing BSE into the U.S. 
cattle population. This simulation indicated that, in a hypothetical 
situation in which 10 infected cattle were imported into the United 
States, on average only four new cases of BSE would arise, and the 
disease would be eliminated in 20 years. The Harvard-Tuskegee study 
determined that these new cases of BSE would most likely arise in the 
United States from incomplete compliance with FDA's ruminant feed 
regulation (see III.A of this document), and also concluded that an 
epidemic of BSE in this country resulting from scrapie, CWD, or another 
TSE is unlikely.
    The Harvard-Tuskegee study estimated the number of cattle 
infectious doses that might be available for human exposure, but it did 
not estimate the likelihood of human disease from this exposure because 
the relationship between the two is not known. According to the study, 
the estimated total infectivity available for human exposure from the 
importation of 10 infected cattle is 35 cattle infectious doses over 20 
years. The Harvard-Tuskegee study determined that the greatest sources 
of infectivity to consumers are direct consumption of cattle brain and 
spinal cord and also meat from advanced meat recovery systems that 
contains central nervous system tissue. The Harvard-Tuskegee study did 
not address potential human exposure to the BSE agent through food 
containing ingredients of cattle origin, such as gelatin, beef stocks, 
extracts, and flavorings or cosmetics.
    The Harvard-Tuskegee study identified three pathways that could 
lead to cattle or human exposure to the BSE agent: (1) Noncompliance 
with FDA's ruminant feed regulation prohibiting the use of certain 
proteins in feed for cattle and other ruminants; (2) rendering of 
animals that die on the farm, and use (through illegal diversion or 
cross-contamination) of the rendered product in ruminant feed; and (3) 
the inclusion of high-risk tissues from cattle, such as brain and 
spinal cord, in products for human oral consumption. Evaluation of 
potential risk mitigation measures in the study found that a 
prohibition against rendering of animals that die on the farm would 
reduce the potential cases of BSE following hypothetical exposure by 82 
percent. In addition, a ban on specified risk materials (SRMs) 
including brain, spinal cord, and vertebral column from inclusion in 
human and animal food would reduce potential BSE cases in cattle by 88 
percent and potential human exposure to BSE by 95 percent. The Harvard-
Tuskegee study also noted the value of ensuring that low-risk cattle 
tissues are not cross-contaminated with high-risk tissue.
    In 2003, after the discovery of a case of BSE in a cow in Canada, 
the USDA asked HCRA to evaluate the implications of the hypothetical 
previous introduction of BSE in the United States from Canada. The HCRA 
model indicated that the potential for spread of BSE among cattle and 
the potential for human exposure to BSE increase as the time period 
lengthens between the introduction of infected Canadian cattle and 
FDA's issuance of the ruminant feed regulation in 1997 (i.e., there is 
more potential for spread of BSE if the infected cattle were imported 
from Canada in 1990 versus 1996). In the worst case scenario involving 
importation of five infected animals from Canada, BSE would be 
eliminated from the United States with high probability by 2020 (Ref. 
30).

E. Specified Risk Materials

1. List of Infective Tissues
    Data on the distribution of BSE infectivity in tissues are 
incomplete, and there are ongoing experiments with cattle to confirm 
and update earlier data (Refs. 2 to 6 and 31). In a pathogenesis study 
in which cattle tissues were assayed for infectivity following 
intracerebral inoculation of tissues from cattle orally exposed to the 
BSE agent, distal ileum and spinal cord were found to harbor 
infectivity as early as 6 months post-inoculation for distal ileum and 
32 months post-inoculation for spinal cord (Refs. 3 and 4). In one 
experiment, cattle were experimentally infected with BSE through 
consumption of the brains of cattle with BSE. Infectivity in the 
tissues of the cattle consuming the brains was evaluated by mouse 
bioassay. In the mouse bioassay, infectivity was detected in brain, 
spinal cord, dorsal root ganglia (clusters of nerve cells attached to 
the spinal cord that are contained within the bones of the vertebral 
column), trigeminal ganglia (clusters of nerve cells connected to the 
brain that lie close to the exterior of the skull), and distal ileum. 
All of the central nervous system (CNS) tissues were found to be 
infective in animals 32 to 40 months after exposure to the BSE agent, 
which in some cases could be months before anticipated onset of 
clinical signs of illness. This study was done with relatively few 
animals (n=30), and the experimental conditions do not reflect field 
conditions of disease transmission. Therefore, a second phase of the 
experiment was initiated, and will continue for several more years, to 
determine if any of the tissues that initially did not appear to be 
infective actually contain low levels of infection. Preliminary results 
from this study have indicated that tonsil, at 10 months after 
exposure, carries a low level of infectivity (Ref. 31).
    In cattle infected with BSE under field conditions, infectivity has 
been found in the brain, spinal cord, and retina of the eye in animals 
with clinical disease (Ref. 31). The Scientific Steering Committee of 
the European Union (Ref. 27) has reported on the proportion of total 
infectivity in various tissues. They estimate that, in an animal with 
clinical disease, approximately 64 percent of the infectivity is in the 
brain, 26 percent is in the spinal cord, 4 percent is in the dorsal 
root ganglia, 2.5 percent is in the trigeminal ganglia, and 3 percent 
is in the distal ileum. The eyes are estimated to contain less than 1 
percent of the infectivity.
    Based on the information presented previously and consistent with 
the USDA's regulation (69 FR 1862, January 12, 2004; discussed in 
section II of this document), we have determined that the tissues with 
the highest risk of harboring BSE infectivity (the SRMs) are

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the brain, skull, eyes, trigeminal ganglia, spinal cord, vertebral 
column (excluding the vertebrae of the tail, the transverse processes 
of the thoracic and lumbar vertebrae, and the wings of the sacrum), and 
dorsal root ganglia of animals 30 months and older, and tonsil and 
distal ileum of cattle of all ages. Though the skull and the vertebral 
column have not been shown to harbor BSE infectivity, they contain 
tissues that have been shown to be infectious; therefore, we are 
including the skull and the vertebral column in the list of SRMs. We 
are not including the vertebrae of the tail, the transverse processes 
of the thoracic and lumbar vertebrae, and the wings of the sacrum as 
SRMs with the rest of the vertebral column, because they do not contain 
spinal cord or dorsal root ganglia.
2. Animal Age at Which Tissues Become Infective
    As discussed in the previous section, most tissues that harbor BSE 
infectivity have been shown to do so in animals more than 30 months 
after exposure to the agent. The exceptions are tonsils, which have 
been shown to harbor infectivity at low levels at 10 months post-
exposure, and the distal ileum, which has been shown to harbor 
infectivity as early as 6 months post-exposure. In a study of the BSE 
epidemic in the United Kingdom, Dealler and Lacey (Ref. 32) noted that 
only 29 of 5,470 animals younger than 36 months of age developed BSE, 
with the peak number of cases occurring between 48 and 60 months of 
age. At the height of the BSE epidemic in the United Kingdom when 
thousands of animals were being diagnosed with BSE each year, fewer 
than 20 animals younger than 30 months were confirmed with the disease 
(Ref. 33). The youngest animal with a confirmed case of BSE was 20 
months old (Ref. 15).
    Though animals younger than 30 months can develop BSE, it is a very 
rare occurrence, based on epidemiological and experimental evidence. 
Therefore, we have concluded that brain, skull, eyes, trigeminal 
ganglia, spinal cord, vertebral column (excluding the vertebrae of the 
tail, the transverse processes of the thoracic and lumbar vertebrae, 
and the wings of the sacrum), and dorsal root ganglia should be 
considered SRMs only in cattle 30 months and older.
    We are aware that there have been documented cases of BSE in 
animals younger than 30 months, and that some tissues become infectious 
before the animal exhibits clinical signs. As mentioned previously, 
during the height of the BSE epidemic in the United Kingdom, a small 
number of animals younger than 30 months showed signs of the disease. 
More recently, Japan has reported cases of BSE in 21- and 23-month-old 
animals, discovered during testing of animals presented for slaughter. 
As the science and epidemiology on this issue develop, FDA may find it 
necessary to modify the age period for SRM removal through future 
rulemaking.
    Based on experimental evidence, we have concluded that the tonsil 
and distal ileum of the small intestine of all cattle should be 
considered SRMs.

F. Small Intestine

    To ensure effective removal of the distal ileum, USDA is requiring 
that the entire small intestine be removed and disposed of as inedible 
product. FDA is also prohibiting the use of the entire small intestine 
in FDA-regulated food and cosmetics as prohibited cattle material. We 
are doing so because: (1) It is difficult to distinguish one end of the 
small intestine from the other once the organ has been removed from the 
animal, (2) there is no international agreement on how much of the 
small intestine should be removed to ensure that the distal ileum is 
separated from the upper part of the intestine, and (3) there is no way 
for a manufacturer or processor to document that the distal ileum was 
adequately removed since there is no international consensus on the 
issue. USDA has solicited comment on whether processors may be able to 
effectively remove just the distal ileum. FDA requests comment on this 
issue as it affects FDA's rule.

G. Mechanically Separated (MS)(Beef)

    MS(Species) is a standardized food defined by the USDA in 9 CFR 
319.5 (see section IV.A of this document for definition of MS(Beef)). 
The standard does not limit the amount of spinal cord and dorsal root 
ganglia that can contaminate vertebral column used to produce the 
product. Consequently, MS(Beef) may contain concentrated amounts of 
such tissues. Because we have concluded that spinal cord, dorsal root 
ganglia and vertebral column are all SRMs, we are designating MS(Beef) 
as a prohibited cattle material.

H. Nonambulatory Disabled Cattle

    Experience has shown that nonambulatory disabled cattle (see 
section IV.A of this document for definition) are the population at 
greatest risk for harboring BSE. Surveillance data in the European 
Union in 2002 showed that there were 29 positive/10,000 tests for BSE 
among healthy-appearing cattle of all ages and 148 positive/10,000 
tests for BSE among nonambulatory animals of all ages (Ref. 34). In 
Switzerland, sampling of particular populations of cattle revealed that 
BSE-positive animals were 49 to 58 times more likely to be found in the 
nonambulatory population than in the population selected for passive 
slaughter surveillance (Ref. 35). The Harvard-Tuskegee study estimated 
that, following importation of 10 infected cattle, a prohibition 
against rendering animals that die on the farm (these animals are 
usually nonambulatory disabled) would decrease the number of new cases 
of BSE by 82 percent.
    Because typical clinical signs of BSE cannot always be observed in 
nonambulatory disabled cattle, and because evidence has indicated these 
cattle are more likely to have BSE than apparently healthy cattle, FDA 
is designating material from nonambulatory disabled cattle as 
prohibited cattle materials.

I. Cattle Not Inspected and Passed for Human Consumption

    For cattle that are not inspected (see section IV.A of this 
document for definition), there is no information as to their 
suitability for use in human food and cosmetics in general, and as to 
their disease status and potential for harboring BSE in particular. In 
addition, such cattle are likely to have died on the farm or en route 
to slaughter, and these animals are not eligible for inspection by the 
USDA. Therefore, these cattle are at higher risk of harboring 
undetected BSE. For cattle that are inspected but not passed, a 
regulatory authority (USDA or other) has made a determination that they 
are not appropriate for use in human food. Such a determination may be 
based, among other things, on evidence of a neurological disorder 
associated with a higher risk of BSE. Moreover, material from cattle 
not inspected or inspected and not passed for human consumption is 
prohibited from human food by USDA. By requiring that material from 
cattle for use in FDA-regulated human food and cosmetics be inspected 
and passed for human consumption, we are minimizing the risk of 
exposure to the agent that causes BSE, and extending the protections 
offered by the USDA or the appropriate regulatory authority in other 
countries to FDA-regulated human food and cosmetics.

J. BSE Testing for Food Safety Purposes

    No practical antemortem tests for BSE exist. The currently 
available postmortem tests, although useful for disease surveillance 
(i.e., determining the rate of disease in the population of

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cattle), are not appropriate as food safety indicators. This is, in 
part, due to limitations on the existing testing methods, which rely on 
the use of brain tissue. Experimental evidence demonstrates that 
certain potentially infective tissues, such as distal ileum and tonsil, 
are the first tissues to accumulate infectivity in the incubation 
period, and this is prior to any infectivity being demonstrated in 
brain tissue (Refs. 3, 36, and 37). Therefore, tests conducted on brain 
tissue may not reflect accurately the potential infectivity in other 
tissues that develop infectivity earlier, such as distal lieum. 
Development of effective food safety indicators will require improved 
understanding of the pathogenesis of the disease and improved 
laboratory methods.

K. Dietary Supplements

    Some dietary supplements contain cattle-derived materials (e.g., 
liver powder, brain, ovaries, eye tissue, mammary tissue, adrenal 
gland, hypothalamus) or substances derived from these tissues. On March 
13, 2003 (68 FR 12158), FDA proposed current good manufacturing 
practice (CGMP) regulations for dietary ingredients and dietary 
supplements. In the proposal, we recognized that animal-derived 
ingredients in dietary supplements present important public health and 
safety issues and that some dietary supplements contain material from 
cattle that may contain the infective agent that causes BSE. We also 
stated that, in the absence of broadly applicable or validated 
diagnostic tests available to manufacturers to identify BSE-infected 
animals or materials, the agency is considering whether to set forth 
specific requirements designed to prevent the use of materials derived 
from certain animals from regions that may present a risk of BSE. 
Further, in the proposal we sought comment, among other things, on 
whether we should include in the final rule specific requirements for 
manufacturing, packing, or holding all animal-derived dietary 
ingredients, including cattle-derived ingredients, whether or not they 
originate from areas with BSE. FDA will respond to those comments in a 
final dietary supplement CGMP rule and consistent with the provisions 
of this rule, which applies to all human food, including dietary 
supplements.

L. Cosmetics

    Cosmetics may be made from a variety of cattle-derived ingredients. 
Tallow derivatives, particularly fatty acids and glycerin, are the 
predominant bovine ingredient used by the cosmetic industry. 
Additionally, ingredients sometimes include albumin, brain extract, 
brain lipid, cholesterol, fibronectin, sphingolipids, collagen, 
keratin, and tallow. Cattle-derived ingredients serve many functions 
and may be used as skin conditioning agents, emollients, binders, and 
hair and nail conditioning agents.
    There are several routes through which cosmetics contaminated with 
the agent that causes BSE could transmit disease to humans. 
Transmission of the BSE agent to humans through intact skin is not 
likely; however, cosmetics may be ingested or applied to cut or abraded 
skin or to mucosal tissues, particularly in the eye, which could 
provide direct routes for infection.
    Although injection into the eye does not represent normal human 
contact with cosmetics, experimental studies in animals may provide 
relevant information on potential routes of exposure. In mice, 
intraocular injection of scrapie caused infection along the optic 
nerve, which eventually spread into non-neural tissue via the lymphatic 
system (Ref. 38). In addition to intraocular injection, infectivity has 
been transmitted to animals via the conjunctiva of the eye (mucosal 
tissue). Scott et al. (Ref. 39) found that scrapie was induced in 42 
percent of rodents by dropping a high concentration of infectivity onto 
the conjunctiva. Klitzman et al. (Ref. 40) suggested that kuru, a human 
TSE disease found only among the Fore people of New Guinea, might have 
been transmitted by rubbing infected human brain into eyes or cut skin, 
while handling and consuming infected brain during funeral rituals.
    Cut or abraded skin also has been proposed as a route for 
contracting TSE diseases. The transmission of kuru through cut skin has 
been suggested and was mentioned previously (Taylor et al. (Ref. 41) 
and Ingrosso et al. (Ref. 42)) demonstrated increased transmission of 
scrapie via oral mucosal tissue. In one study, 100 percent of mice with 
experimentally damaged oral mucosal tissue developed scrapie through 
ingestion of infected material, while only 71 percent of mice with 
intact mucosa developed the disease (Ref. 41). In addition, Pammer et 
al. (Ref. 43) and Sugaya et al. (Ref. 44) noted that epithelial cells, 
dendritic cells, and keratinocytes (the primary cell types found in the 
epidermis) have been found to contain infectious prion protein, 
indicating that these cells are potential targets for peripheral 
infection with a TSE disease.
    Use of BSE-contaminated cosmetics could provide a means of human 
infection via several routes discussed previously. Many cosmetics are 
typically applied in the area of the eye (mascara, eye brow pencil, 
eyeliner, eye lotion, and eye makeup remover) and almost any cosmetic, 
including shampoo, can get into the eye via eye rubbing or incorrect 
application. Any cosmetic product, but particularly shaving creams and 
gels and lotions, may be applied to cut or abraded skin. Many products 
may come in contact with mucosal tissue via rubbing. Cosmetics that are 
ingested, such as lipstick, dentifrices, mouthwash, and breath 
fresheners, would have the same route of infection as the feeding 
studies mentioned previously, if the cosmetics were contaminated with 
the agent that causes BSE.

M. Tallow and Tallow Derivatives

    Tallow is an animal-derived hard fat that has been heat processed; 
most tallow is derived from cattle. Any risk of BSE transmission from 
tallow is a result of protein that is present as an impurity in the 
tallow. Taylor et al. (Refs. 45 and 46) found in rendering studies with 
abnormal prion protein that the prion protein did not preferentially 
migrate into the fat fraction, but remained with the protein fraction. 
Therefore, there is no reason to believe that tallow is likely to 
contain unusually high amounts of prion protein as a constituent of the 
insoluble impurities fraction that remains in tallow after rendering. 
Taylor et al. (Refs. 45 and 46) also reported that the various 
rendering processes used for tallow production in the United Kingdom 
were sufficient to produce tallow that did not result in infection when 
injected into the brains of mice, even though the starting material was 
highly spiked with the scrapie agent. Wilesmith et al. (Ref. 47) noted 
that the geographical variation in the incidence of BSE in the United 
Kingdom was not consistent with the use of tallow in cattle feed and 
concluded that the most likely source of infection in cattle was BSE-
contaminated meat and bone meal.
    The Office International des Epizooties (OIE), the international 
animal health standard setting body, categorizes tallow with insoluble 
impurities of no more than 0.15 percent as protein-free tallow and 
indicates that tallow that meets this standard can be safely consumed 
by animals regardless of the starting materials (Ref. 48). There is 
thought to be a 10- to 10,000-fold increase in the amount of infectious 
material needed to cause illness in humans as compared with cattle 
because of the species barrier, though the European Commission's 
Scientific Steering Committee cautioned that this

[[Page 42261]]

range is uncertain and in a unlikely, but worst case scenario, the 
species barrier may not exist (Ref. 49). FDA's Transmissible Spongiform 
Encephalopathy Advisory Committee (TSEAC) considered the safety of 
tallow and tallow derivatives in 1998 (Ref. 50). Members of the 
Committee indicated that tallow is a food with negligible or no risk of 
transmitting BSE to humans or animals.
    Based on the research and the opinions noted previously, we are 
permitting tallow to be used in human food and cosmetics if it contains 
no more than 0.15 percent hexane-insoluble impurities or otherwise 
complies with these regulations. We believe we are adequately 
protecting human health by requiring a tallow standard for human food 
and cosmetics that is as protective as the standard recommended by OIE 
to prevent BSE in cattle.
    Tallow derivatives are produced by subjecting tallow to chemical 
processes (hydrolysis, trans-esterification, and saponification) that 
involve high temperature and pressure. The TSEAC considered tallow 
derivatives in 1998 (Ref. 50) and determined that the rigorous 
conditions of manufacture are sufficient to further reduce the BSE risk 
in tallow derivatives. In addition, the OIE also recommends that 
derivatives of protein-free tallow be freely traded among countries 
because they pose insignificant BSE risk to animals (Ref. 48). Because 
we believe that tallow has negligible risk of transmitting BSE, and 
tallow derivatives undergo additional processing, we do not believe 
that tallow derivatives pose a risk of transmitting the agent that 
causes BSE to humans.

II. USDA Interim Final Rule

    On January 12, 2004, in response to the diagnosis of BSE in a cow 
in the United States, USDA published a series of interim final rules 
including ``Prohibition of the Use of Specified Risk Materials for 
Human Food and Requirements for the Disposition of Non-Ambulatory 
Disabled Cattle'' (69 FR 1862). The rule declares that SRMs are 
inedible and unfit for food and prohibits their use as human food. The 
rule designates the following as SRMs: The brain, skull, eyes, 
trigeminal ganglia, spinal cord, vertebral column (excluding the 
vertebrae of the tail, the transverse processes of the thoracic and 
lumbar vertebrae, and the wings of the sacrum), and dorsal root ganglia 
of cattle 30 months of age and older, and the tonsils and distal ileum 
of the small intestine of all cattle. To ensure the distal ileum is 
completely removed, the entire intestine must be removed and disposed 
of as inedible. The rule also declares that MS(Beef) is unfit for food 
and inedible. In addition, the rule requires that all nonambulatory 
disabled cattle presented for slaughter be condemned and not used in 
human food. Furthermore, the rule requires that establishments that 
slaughter cattle or that process the carcasses or parts of carcasses of 
cattle maintain daily records sufficient to document the implementation 
and monitoring of procedures for removal, segregation, and disposition 
of SRMs. Finally, the rule deems all age-associated SRMs (all SRMs 
except tonsil and distal ileum) to be from animals 30 months or older 
unless an establishment can demonstrate that the materials are from an 
animal that was younger than 30 months of age at the time of slaughter.
    In this interim final rule, FDA is extending similar protections to 
FDA-regulated human food and cosmetics. The USDA's interim final rule 
will reduce but will not, by itself, eliminate the availability and use 
of prohibited cattle materials in domestic and imported FDA-regulated 
human food and cosmetics. Domestically, generally human food that 
contains meat only in a relatively small proportion or that 
historically has not been considered by consumers to be products of the 
meat food industry (e.g., soup stock, beef flavors and extracts, 
gelatin), is not produced under USDA inspection (see definition of 
``meat food product'' in 21 U.S.C. 601(j)) and may be physically 
available for use in FDA-regulated human food and cosmetics. Further, 
even when excluded from human food produced in USDA-inspected 
establishments, prohibited cattle materials may leave the 
establishments for inedible rendering or destruction. These materials, 
which previously have not been explicitly prohibited in human food and 
cosmetics by FDA, might then be used in FDA-regulated human food or 
cosmetics. For example, prohibited cattle materials leaving a USDA-
inspected facility might not be denatured sufficiently to preclude 
their use in FDA-regulated human food and cosmetics.
    Under the Food Safety and Inspection Services' (FSIS') rule, SRMs, 
small intestine from all cattle, and material from nonambulatory 
disabled cattle must be designated as inedible. However, certain 
products, such as gelatin and collagen (which are both covered by the 
provisions of this rule) used in FDA-regulated human food and 
cosmetics, have traditionally been produced from cattle material deemed 
inedible by the USDA. Therefore, such a designation by the USDA may not 
be enough to preclude use of prohibited cattle materials in FDA-
regulated products without additional regulation by FDA. Further, some 
cattle are not slaughtered under continuous USDA inspection (e.g., some 
are sent directly to rendering). Cattle material from these animals, 
such as brains or bones which include SRMs, could end up as starting 
material for human food, such as meat extracts or gelatin, 
respectively. Furthermore, if prohibited cattle materials were used in 
FDA-regulated human food or cosmetics, the rule would facilitate FDA's 
ability to use the enforcement mechanisms of the Federal Food, Drug, 
and Cosmetic Act (the act) that apply to adulterated products (e.g., 
seizure) to prevent human exposure to the prohibited cattle materials.
    Imported products also may contain the types of materials 
prohibited by the USDA, but which would not fall within the scope of 
the USDA's import regulations either because of the nature of the 
products or their country of origin. Specifically, although both FSIS 
and Animal and Plant Health Inspection Service (APHIS) impose BSE-
related prohibitions, these prohibitions collectively do not cover all 
FDA-regulated human food and cosmetics. FSIS' restrictions, contained 
in its interim final rule described earlier in this document, do not 
apply to importation of dietary supplements, cosmetics, and FDA-
regulated human food not considered to be ``meat food products'' under 
the Federal Meat Inspection Act (21 U.S.C. 601(j)).
    APHIS' BSE-related restrictions on imports do not cover gelatin for 
human use (beyond requiring a permit) or cosmetics, and apply only to a 
limited number of countries (9 CFR 94.18).

III. FDA Actions on BSE

A. The FDA Ruminant Feed Regulation

    In the Federal Register of June 5, 1997 (62 FR 30936), FDA 
published a regulation that prohibits, with some exceptions, the use of 
protein derived from mammalian tissues in feed for cattle and other 
ruminant animals (21 CFR 589.2000) (ruminant feed regulation). FDA 
published the ruminant feed regulation because of findings that 
ruminants had been fed protein derived from animals in which TSEs were 
found and that consumption of this protein may cause TSEs in ruminants. 
The regulation was intended to prevent the establishment and 
amplification of BSE in the United States and thereby minimize any risk 
to animals and humans. FDA currently is

[[Page 42262]]

considering changes to further strengthen the regulation.

B. FDA Guidance

    During the past decade, we have communicated with the public and 
manufacturers, applicants, importers, and processors of FDA-regulated 
human food and cosmetics about appropriate steps to increase product 
safety and minimize the risk of products being contaminated with the 
BSE agent. Most of our communications have been in the form of letters 
and guidance to industry and import alerts.
     November 1992--We wrote to manufacturers of dietary 
supplements to alert them to the developing concern about TSEs in 
animals and CJD in humans and recommended that they investigate the 
geographic sources of any bovine and ovine material used in their 
products. We suggested that manufacturers develop plans to ensure, with 
a high degree of certainty, that bovine and ovine materials used in 
their products were not from countries where BSE exists (``BSE 
countries'' specified by USDA's APHIS in 9 CFR 94.18) or from sheep 
flocks (foreign or domestic) infected with scrapie.
     August 1994--We published a notice in the Federal Register 
(59 FR 44592, August 29, 1994) entitled ``Bovine-Derived Materials; 
Agency Letters to Manufacturers of FDA-Regulated Products.'' The notice 
published the November 1992 letter previously described and, 
additionally, letters to manufacturers of FDA-regulated drugs, 
biologics, and medical devices (December 1993), products for animals 
(August 17, 1994), and manufacturers and importers of dietary 
supplements and cosmetics (August 17, 1994). The letter to the 
manufacturers and importers of dietary supplements and cosmetics 
included our recommendation that firms manufacturing or importing 
dietary supplements or cosmetics containing specific bovine tissues 
ensure that the tissues do not come from cattle born, raised, or 
slaughtered in BSE countries.
     October 1994--We issued Import Alert 17-04, which allowed 
for the detention, without examination, of bulk shipments of high-risk 
bovine tissues and tissue-derived ingredients from BSE countries. When 
FDA issued Import Alert 17-04 in 1994, the list of BSE countries 
included the United Kingdom, France, Ireland, Oman, Switzerland, and 
Portugal. We have updated this alert whenever APHIS has revised the 
list of countries in 9 CFR 94.18.
     May 1996--We sent a letter to manufacturers and importers 
of dietary supplements and cosmetics stating that FDA strongly believed 
that manufacturers should take immediate and concrete steps to reduce 
the potential risk of human exposure to the BSE infectious agent.
     October 1997--We published a notice of availability (62 FR 
52345, October 7, 1997) of a guidance for industry entitled ``The 
Sourcing and Processing of Gelatin to Reduce the Potential Risk Posed 
by Bovine Spongiform Encephalopathy (BSE) in FDA-Regulated Products for 
Human Use.'' In the guidance FDA recommends, among other things, that 
gelatin processors ensure that slaughterhouses that supply cattle bones 
for gelatin production remove heads, spines, and spinal cords as the 
first procedure following slaughter.

IV. Description of Interim Final Rule and Legal Authority

A. Definitions

    In new Sec. Sec.  189.5(a) and 700.27(a) (21 CFR 189.5(a) and 21 
CFR 700.27(a)) we are defining the following terms for the purposes of 
this regulation:
    1. Prohibited cattle materials means specified risk materials, 
small intestine of all cattle, material from nonambulatory disabled 
cattle, material from cattle not inspected and passed, or MS(Beef). The 
phrase ``prohibited cattle materials'' includes all of the individual 
categories of materials and tissues prohibited by this rulemaking. 
Prohibited cattle materials do not include tallow that contains no more 
than 0.15 percent hexane-insoluble impurities and tallow derivatives.
    2. Inspected and passed means that the product has been inspected 
and passed for human consumption by the appropriate regulatory 
authority, and at the time it was inspected and passed, it was found to 
be not adulterated. This definition is consistent with the USDA's 
definition in 9 CFR 301.2.
    3. Mechanically Separated (MS)(Beef) means a meat food product that 
is finely comminuted, resulting from the mechanical separation and 
removal of most of the bone from attached skeletal muscle of cattle 
carcasses and parts of carcasses, that meets the specifications 
contained in 9 CFR 319.5, the USDA regulation that prescribes the 
standard of identity for MS(Species). This definition of MS(Beef) is 
consistent with the term as used by the USDA in its recent interim 
final rule (69 FR 1862) prohibiting its use in human food.
    4. Nonambulatory disabled cattle means cattle that cannot rise from 
a recumbent position or that cannot walk, including, but not limited 
to, those with broken appendages, severed tendons or ligaments, nerve 
paralysis, fractured vertebral column or metabolic conditions. This 
definition of nonambulatory disabled cattle is consistent with the 
definition of nonambulatory disabled livestock in the USDA's interim 
final rule (69 FR 1862) requiring that nonambulatory disabled cattle be 
condemned and not used as human food.
    5. Specified risk material (SRM) means the brain, skull, eyes, 
trigeminal ganglia, spinal cord, vertebral column (excluding the 
vertebrae of the tail, the transverse processes of the thoracic and 
lumbar vertebrae, and the wings of the sacrum), and dorsal root ganglia 
of cattle 30 months and older, and the tonsils and distal ileum of the 
small intestine of all cattle. This definition of SRMs is the same as 
that used by the USDA in its interim final rule (69 FR 1862) declaring 
SRMs to be inedible and prohibiting their use in human food.
    6. Tallow means the rendered fat of cattle obtained by pressing or 
by applying any other extraction process to tissues derived directly 
from discrete adipose tissue masses or to other carcass parts and 
tissues. Tallow must be free of prohibited cattle material or must 
contain not more than 0.15% hexane-insoluble impurities determined by 
the method for ``hexane-insoluble matter,'' pp. 464-465, the Food 
Chemicals Codex, 5th Ed. (2003), incorporated by reference in 
accordance with 5 U.S.C. 552(a) and 1 CFR part 51, or another method 
equivalent in accuracy, precision, and sensitivity to the method in the 
Food Chemicals Codex. You may obtain copies of the above-referenced 
method from the Division of Dairy and Egg Safety (HFS-306), Center for 
Food Safety and Applied Nutrition, Food and Drug Administration, 5100 
Paint Branch Pkwy., College Park, MD 20740, or you may examine a copy 
at the Center for Food Safety and Applied Nutrition's Library, 5100 
Paint Branch Pkwy., College Park, MD, or at the Office of the Federal 
Register, 800 North Capitol St., NW., Suite 700, Washington, DC.
    7. Tallow derivative means any chemical obtained through initial 
hydrolysis, saponification, or trans-esterification of tallow; chemical 
conversion of material obtained by hydrolysis, saponification, or 
trans-esterification may be applied to obtain the desired product.

B. Requirements for Prohibited Cattle Materials

    USDA recently declared SRMs and MS(Beef) unfit for food and 
inedible and prohibited their use in human food. USDA also required 
that all nonambulatory disabled cattle

[[Page 42263]]

presented for slaughter be condemned and not used in human food and 
that small intestine of all cattle be removed and disposed of as 
inedible. To ensure that the SRMs, small intestine of all cattle, 
MS(Beef), and material from nonambulatory disabled animals are not 
incorporated into FDA-regulated human food and cosmetics, we are 
similarly prohibiting the use of SRMs, small intestine of all cattle, 
MS(Beef) and material from nonambulatory disabled cattle in human food 
and cosmetics. We are also prohibiting material from cattle not 
inspected and passed. We are defining these five categories of material 
as prohibited cattle materials.
    Scientists believe that the human disease vCJD is likely caused by 
the consumption of products contaminated with the agent that causes 
BSE. The relationship between the agent that causes BSE and human cases 
of vCJD has been described in section I.C of this document. 
Contamination of products with infected cattle CNS tissue is believed 
to have led to the development of vCJD in humans (Refs. 16, 26, and 
27).
    Currently, no practical method for testing products for the agent 
that causes BSE is available and, therefore, we do not have a means of 
distinguishing products that contain infectious material from products 
that do not. Consumers also often are not able to determine which 
products contain prohibited cattle materials and which products do not. 
For example, rendered products including brain and spinal cord may 
become ingredients in soups, broths, meat flavors, extracts, dietary 
supplements and cosmetics, where their presence may not be indicated as 
such on the label. Furthermore, consumers have no way to determine 
whether animal material in a human food or cosmetic was sourced from 
nonambulatory disabled cattle or from cattle that were not inspected 
and passed for human consumption.
    In addition to being unable to test for infectious material in 
products, we also do not know the infectious dose for humans. Despite 
widespread exposure in the United Kingdom to BSE-contaminated meat 
products, only a very small percentage of the exposed population has 
been diagnosed with vCJD to date. However, ongoing experiments indicate 
that the infectious dose for cattle is very low. One gram of affected 
cattle brain homogenate is sufficient to cause BSE in more than 50 
percent of calves exposed by mouth. Five years after oral consumption 
of lower doses of brain material, 2 of 15 calves fed 0.1 gram had 
developed BSE, and 1 of 15 fed 0.01 gram had developed the disease. 
This experiment is ongoing (Ref. 51). There is thought to be a 10- to 
10,000-fold increase in the amount of infectious material needed to 
cause illness in humans, as compared with cattle, because of the 
species barrier (Ref. 49).
    We know that consumption of contaminated material has caused 
illness in humans, although we do not know the infectious dose, and we 
cannot test to determine which products contain infectious material. 
Therefore, we have provided in Sec.  189.5(b) that no human food shall 
be manufactured from, processed with, or otherwise contain prohibited 
cattle materials, and in Sec.  700.27(b) that no cosmetic shall be 
manufactured from, processed with, or otherwise contain, prohibited 
cattle materials.
    FDA is applying these requirements for prohibited cattle materials 
to all products or ingredients of products manufactured in the U.S. or 
imported into the U.S. In an advanced notice of proposed rulemaking, 
entitled ``Federal Measures to Mitigate BSE Risks: Considerations for 
Further Actions,'' published by APHIS, FSIS, and FDA in this issue of 
the Federal Register, FSIS is seeking comment on the issue of 
equivalence and BSE requirements. Likewise, FDA requests comment on 
standards to apply when determining another country's BSE status, 
providing an exemption for ``BSE-free'' countries, and how to determine 
that countries meet any standards that might be developed. FDA intends 
to work with USDA in developing a harmonized U.S. position on exempting 
other countries from our respective requirements related to BSE.

C. Tallow and Tallow Derivatives

    Tallow is defined in Sec. Sec.  189.5(a)(6) and 700.27(a)(6) as 
``the rendered fat of cattle obtained by pressing or by applying any 
other extraction process to tissues derived directly from discrete 
adipose tissue masses or to other carcass parts and tissues.'' Tallow 
derivatives are defined in Sec. Sec.  189.5(a)(7) and 700.27(a)(7) as 
``any chemical obtained through initial hydrolysis, saponification, or 
trans-esterification of tallow or the chemical conversion of material 
obtained by hydrolysis, saponification, or trans-esterification.'' For 
the reason described in section I.K of this document, we provide in 
Sec. Sec.  189.5(a)(1) and 700.27(a)(1) that tallow with no more than a 
0.15 percent hexane-insoluble impurities and tallow derivatives are not 
considered prohibited cattle materials under this rule. We are 
requiring in Sec. Sec.  189.5(a)(6) and 700.27(a)(6) that you measure 
the hexane-insoluble impurities in tallow by the method for ``hexane-
insoluble matter'' described in the 5th edition of the Food Chemicals 
Codex (Institute of Medicine, National Academies of Science) and 
incorporated by reference into this rule or by another method that is 
at least equivalent in accuracy, precision and sensitivity to the 
method described in the Food Chemicals Codex, 5th edition. Tallow that 
contains more than 0.15 percent hexane-insoluble impurities may be used 
if it complies with the requirements for cattle materials in Sec.  
189.5 for human food and Sec.  700.27 for cosmetics.
    We note that, regardless of its purity level, tallow to be used in 
human food and cosmetics is subject to the other provisions of the act 
and is adulterated, for example, if it has been prepared, packed or 
held under insanitary conditions whereby it may have become 
contaminated with filth (21 U.S.C. 342(a)(4)).

D. Records Access Requirements

    We are requiring in Sec. Sec.  189.5(c) and 700.27(c) that 
manufacturers and processors of human food and cosmetics that are 
manufactured from, processed with, or otherwise contain, material from 
cattle must make existing records relevant to compliance with this rule 
available to FDA for inspection and copying. We believe that records 
documenting the absence of prohibited cattle materials in human food 
and cosmetics are critical for manufacturers, processors, and FDA to 
ensure compliance with the prohibitions on the use of prohibited cattle 
materials in this interim final rule. Once material is removed from 
cattle, we may not be able to obtain the information necessary to 
determine whether it is prohibited cattle materials. There is currently 
no way to test reliably for the presence of the BSE agent or for the 
presence of prohibited cattle materials. Therefore, manufacturers and 
processors of human food and cosmetics must depend on records from the 
suppliers of cattle material to demonstrate that their supplier's 
cattle material does not contain prohibited cattle materials.
    The agency believes that recordkeeping and records access 
requirements are necessary immediately. The agency, however, recognizes 
that recordkeeping systems cannot be put into place immediately and, 
therefore, to include recordkeeping requirements in this interim final 
rule could result in manufacturers and processors immediately being in 
violation of the adulteration provisions of the act with respect to 
human food and cosmetics because of their failure

[[Page 42264]]

immediately to establish and maintain the necessary records as of the 
effective date of this interim final rule. For that reason, we are 
proposing record establishment and maintenance requirements in a 
separate rulemaking, rather than including them in this interim final 
rule. Accordingly, in this issue of the Federal Register, we are 
proposing to require that those manufacturers and processor establish 
and maintain records to demonstrate compliance with this rule (see 
``Recordkeeping Requirements for Human Food and Cosmetics Manufactured 
From, Processed With, or Otherwise Containing Material from Cattle''). 
Although the agency is pursuing a separate rulemaking on recordkeeping, 
we believe that some records may already be maintained that could 
provide the agency with valuable compliance information before a final 
rule on recordkeeping is issued as a result of the separate rulemaking. 
Therefore, we are requiring in this interim final rule that FDA be able 
to access already existing records that may demonstrate, or be relevant 
to, compliance with this rule.

E. Scope of the Interim Final Rule

    The prohibitions contained in Sec.  189.5 (b) apply to all FDA-
regulated human food, except tallow and tallow derivatives. ``Human 
food'' is ``food'' as that term is defined in section 201(f) of the act 
(21 U.S.C. 321(f)), except for animal food. Specifically, ``human 
food'' is: (1) Articles used for food or drink for man, (2) chewing 
gum, and (3) articles used for components of any such article. ``Human 
food'' includes, but is not limited to, food additives, including 
substances that migrate into food from food packaging and other 
articles that contact food, color additives, dietary supplements and 
dietary ingredients, and infant formula.
    The prohibitions contained in Sec.  700.27 (b) apply to all FDA-
regulated cosmetics. ``Cosmetic'' is defined in section 201(i) of the 
act (21 U.S.C. 321(i)) as
    (1) articles intended to be rubbed, poured, sprinkled or sprayed 
on, introduced into, or otherwise applied to the human body or any 
part thereof for cleansing, beautifying, promoting attractiveness, 
or altering the appearance, and (2) articles intended for use as a 
component of any such articles; except that such term shall not 
include soap.
    In 21 CFR 701.20, FDA explains the criteria articles must meet to 
be considered ``soap'' under section 201(i) of the act.

F. Legal Authority

    FDA is issuing these regulations under the adulteration provisions 
in sections 402(a)(2)(C), (a)(3), (a)(4), (a)(5), 601(c), and under 
section 701(a) of the act (21 U.S.C. 342(a)(2)(C), (a)(3), (a)(4), 
(a)(5), 361(c), and 371(a)). Under section 402(a)(3) of the act, a food 
is deemed adulterated ``if it consists in whole or in part of any 
filthy, putrid, or decomposed substance, or if it is otherwise unfit 
for food.'' ``Otherwise unfit for food'' is an independent clause in 
section 402(a)(3). It does not seem to require that a food be filthy, 
putrid, or decomposed for it to be ``otherwise unfit for food.'' We 
conclude that a food can be ``otherwise unfit for food'' based on 
health risks. We seek comments on this interpretation. Because of the 
discovery of a BSE positive cow in the United States and the 
possibility of disease transmission to humans from exposure to material 
from infected cattle, prohibited cattle materials (SRMs, small 
intestine of all cattle, MS(Beef), material from nonambulatory disabled 
cattle, and material from cattle not inspected and passed) may present 
a risk to human health. Under our interpretation of section 402(a)(3), 
these materials are unfit for food. Under section 402(a)(4) of the act, 
a food is adulterated ``if it has been prepared, packed, or held under 
insanitary conditions whereby it may have become contaminated with 
filth, or whereby it may have been rendered injurious to health.'' The 
failure to ensure that food is prepared, packed, or held under 
conditions in which prohibited cattle materials do not contaminate the 
food constitutes an insanitary condition whereby it may have been 
rendered injurious to health and thus renders the food adulterated 
under section 402(a)(4). Under section 402(a)(5) of the act, food is 
deemed adulterated if ``* * * it is, in whole or in part, the product * 
* * of an animal which has died otherwise than by slaughter.'' Some 
cattle are not inspected and passed because they have died before 
slaughter. Material from these cattle that die otherwise than by 
slaughter is adulterated under section 402(a)(5).
    We are also relying on the food additive provision in section 
402(a)(2)(C) of the act. Any substance whose intended use results or 
may reasonably be expected to result in it becoming a component of food 
is a food additive unless, among other things, it is the subject of a 
prior sanction (explicit approval for a specific use by USDA or FDA 
prior to September 6, 1958), or is generally recognized as safe (GRAS). 
The regulations under 21 CFR 181.1(b) provide that, if scientific data 
or information shows that the use of a prior-sanctioned ingredient may 
be injurious to health and, thus, in violation of section 402 of the 
act, FDA can prohibit use of the ingredient in food. Prior sanctions 
are described in 21 CFR part 181. FDA is not aware of any prior 
sanctions that relate to the present use of prohibited cattle 
materials. However, to the extent any prior sanctions exist for the use 
of prohibited cattle materials in food, they are hereby revoked.
    A determination that a substance added directly or indirectly to a 
food is GRAS for its intended use is generally based on specific 
information regarding the composition of the substance, its use, method 
of preparation, methods for detecting its presence in food, and 
information about its functionality in food as determined by experts 
qualified by scientific training and experience to evaluate the safety 
of such a substance (21 CFR 170.35). A substance added to food becomes 
GRAS as a result of a common understanding about the substance 
throughout the scientific community familiar with the safety of such 
substances. The basis of expert views may be either scientific 
procedures, or, in the case of a substance used in food prior to 
January 1, 1958, experience based on common use in food (Sec.  
170.30(a)) (21 CFR 170.30(a)). Substances that are GRAS based on use 
prior to January 1, 1958, must be currently recognized as safe based on 
their pre-1958 use (See United States v. Naremco, 553 F.2d 1138 (8th 
Cir. 1977); compare United States v. Western Serum, 666 F.2d 335 (9th 
Cir. 1982)).
    General recognition of safety based upon scientific procedures 
requires the same quantity and quality of scientific evidence as is 
required to obtain approval of a food additive regulation for the 
ingredient (Sec.  170.30(b)). (See United States v. Naremco, 553 F.2d 
at 1143). A substance is not GRAS if there is a genuine dispute among 
experts as to its recognition (An Article of Drug * * * Furestrol 
Vaginal Suppositories, 251 F. Supp 1307 (N.D. Ga. 1968), aff'd, 415 
F.2d 390 (5th Cir. 1969)). It is not enough, in attempting to establish 
that a substance is GRAS, to establish that there is an absence of 
scientific studies that demonstrate the substance to be unsafe; there 
must be studies that show the substance to be safe (United States v. An 
Article of Food* * * CoCo Rico, 752 F.2d 11 (1st Cir. 1985)). 
Conversely, a substance may be ineligible for GRAS status if studies 
show that the substance is, or may be, unsafe, or if there is a 
conflict in studies.
    Expert opinion that prohibited cattle materials are GRAS would need 
to be supported by scientific literature, and

[[Page 42265]]

other sources of data and information, establishing that there is a 
reasonable certainty of no harm from the material under the intended 
conditions of use. Expert opinion would need to address topics such as 
whether BSE infectivity can be detected and whether it is reasonably 
certain that the BSE agent will not be transmitted through prohibited 
cattle materials. The burden of establishing that a substance is GRAS 
is on the proponent of the substance. (See CoCo Rico, supra).
    For the reasons discussed in section I of this document, the agency 
is declaring that prohibited cattle materials are not GRAS by qualified 
experts for use in human food and, therefore, are food additives. 
Section 402(a)(2)(C) of the act deems food adulterated ``if it is, or 
it bears or contains, any food additive which is unsafe within the 
meaning of section 409 * * *.'' Under section 409(a) (21 U.S.C. 
348(a)), a food additive is unsafe unless a food additive regulation or 
an exemption is in effect with respect to its use or its intended use. 
As a result, because neither a food additive regulation, nor an 
exemption, is in effect for prohibited cattle materials intended for 
use in human food, such materials, with the exception of dietary 
ingredients in dietary supplements, are adulterated under section 
402(a)(2)(C) of the act, and their presence in food renders the food 
adulterated.
    Dietary supplements are considered food under the act and are 
included in this rule. However, the food additive definition in section 
201(s)(6) of the act exempts from regulation as a food additive ``an 
ingredient described in paragraph (ff) in, or intended for use in, a 
dietary supplement.'' An ingredient described in section 201(ff) is a 
dietary ingredient. Therefore, a dietary ingredient, within the meaning 
of section 201(ff), is not subject to regulation as a food additive. 
FDA notes that, under this rule, ingredients containing prohibited 
cattle materials, and dietary supplements containing such ingredients, 
would be adulterated food under section 402(a)(3) and (a)(4) of the 
act, as unfit for food and as food prepared, packed, or held under 
insanitary conditions whereby it may have been rendered injurious to 
health. Such dietary ingredients would also be adulterated under 
section 402(a)(5) of the act if sourced from an animal that died other 
than by slaughter.
    Under section 601(c) of the act, a cosmetic is adulterated ``if it 
has been prepared, packed, or held under insanitary conditions whereby 
it may have become contaminated with filth, or whereby it may have been 
rendered injurious to health.'' The failure to ensure that a cosmetic 
is prepared, packed, or held under conditions in which prohibited 
cattle materials do not contaminate the cosmetic constitutes an 
insanitary condition whereby it may have been rendered injurious to 
health and, thus, renders the cosmetic adulterated under section 
601(c).
    Under section 701(a) of the act, FDA is authorized to issue 
regulations for the act's efficient enforcement. A regulation that 
requires measures to prevent human food from being unfit for food, from 
being or bearing an unsafe food additive, from being the product of an 
animal that died otherwise than by slaughter, and to prevent human food 
and cosmetics from being held under insanitary conditions, allows for 
efficient enforcement of the act. The regulations require that 
manufacturers and processors of human food and cosmetics that are 
manufactured from, processed with, or otherwise contain, material from 
cattle make existing records available to FDA for inspection and 
copying. Once material is removed from cattle, we may not be able to 
obtain the information necessary to determine whether it is prohibited 
cattle material. For example, we would not know from examination of a 
spinal cord whether the source animal was over 30 months of age at the 
time of slaughter or whether it was inspected and passed. Therefore, 
the records access requirement is necessary for the efficient 
enforcement of this rule. Failure to comply with this rule's records 
access requirement renders the affected food and cosmetics adulterated 
under sections 402(a)(4) and 601(a) respectively.

V. Issuance of an Interim Final Rule, Immediate Effective Date, and 
Opportunity for Public Comment

    We are issuing this rule as an interim final rule, effective 
immediately, with an opportunity for public comment. Section 
553(b)(3)(B) of the Administrative Procedure Act (5 U.S.C. 
553(b)(3)(B)) provides that, when an agency for good cause finds that 
notice and public procedure are impracticable, unnecessary, or contrary 
to public interest, the agency may issue a rule without providing 
notice and public comment. FDA has determined that there is good cause 
under 5 U.S.C. 553(b)(3)(B) and 21 CFR 10.40(d) because the discovery 
of BSE in a cow in the United States requires regulations in place 
immediately to impose restrictions on the use of cattle material in 
human food and cosmetics to further reduce the possibility of 
transmission of vCJD. Further, under 5 U.S.C. 553(d)(3), we find good 
cause to make the rule effective immediately. It is imperative that we 
act quickly to impose these restrictions on the use of cattle material 
in human food and cosmetics to further reduce the possibility of 
transmission of vCJD and ensure that there is consistent protection of 
the U.S. food supply by imposing upon FDA-regulated products the same 
restrictions related to BSE imposed upon USDA-regulated products.
    FDA invites public comment on this interim final rule. The comment 
period on this interim final rule will be 90 days. The agency will 
consider modifications to this interim final rule based on comments 
made during the comment period. Interested persons may submit to the 
Division of Dockets Management (see ADDRESSES) written or electronic 
comments regarding this interim final rule. Submit a single copy of 
electronic comments or two paper copies of any mailed comments, except 
that individuals may submit one paper copy. Comments are to be 
identified with the docket number found in brackets in the heading of 
this document. Received comments may be seen in the Division of Dockets 
Management between 9 a.m. and 4 p.m., Monday through Friday.
    This interim final rule applies to human food and cosmetics 
manufactured from, processed with, or that otherwise contain, material 
from cattle slaughtered on or after its effective date. Human food and 
cosmetics under the act include their components and the rule applies 
to these components. FDA realizes that it may be difficult, in certain 
instances, for manufacturers and processors to comply immediately with 
all of the provisions of this interim final rule. We may consider this 
in enforcing the rule.
    FDA will address comments received and confirm or amend this 
interim final rule in a final rule.

VI. Analysis of Economic Impacts of the Interim Final Rule Use of 
Materials Derived From Cattle in Food and Cosmetics

A. Interim Final Regulatory Impact Analysis

    FDA has examined the economic implications of this interim final 
rule as required by Executive Order 12866. 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;

[[Page 42266]]

distributive impacts; and equity). Executive Order 12866 classifies a 
rule as significant if it meets any one of a number of specified 
conditions, including: Having an annual effect on the economy of $100 
million, adversely affecting a sector of the economy in a material way, 
adversely affecting competition, or adversely affecting jobs. A 
regulation is also considered a significant regulatory action if it 
raises novel legal or policy issues. FDA has determined that this 
interim final rule is not an economically significant regulatory 
action.
1. Need for Regulation
    The FSIS' interim final rule requires that specified risk 
materials, small intestine from all cattle, tissue from nonambulatory 
disabled cattle, and MS(Beef) not be used for human food. Specified 
risk materials include the brain, skull, eyes, trigeminal ganglia, 
spinal cord, vertebral column (excluding the vertebrae of the tail, the 
transverse process of the thoracic and lumbar vertebrae, and the wings 
of the sacrum), and dorsal root ganglia of cattle 30 months and older, 
and the tonsils and distal ileum of the small intestine of all cattle. 
The FSIS interim final rule requires that all of the prohibited 
materials be destroyed or sent to inedible rendering.
    FDA, in response to the finding of an adult cow that tested 
positive for BSE in the State of Washington and to be consistent with 
the USDA in regulating cattle products that could potentially transmit 
BSE, is issuing this interim final rule for FDA-regulated food and 
cosmetics that may contain cattle material of concern. Specifically, 
this interim final rule regulates cattle materials that may be used in 
human foods (e.g., dietary supplements, food additives, color 
additives, infant formula) and cosmetics.
    This interim final rule will not affect the incidence of BSE in 
cattle, which is addressed in other FDA regulations. This interim final 
rule will serve as a safeguard to reduce human exposure to the agent 
that causes BSE that may be present in cattle-derived products from 
domestic and imported sources. If BSE-infected cattle or cattle 
material is prevented from use in human food by the requirements in 
this rule (e.g., the requirement that cattle materials be sourced from 
inspected and passed animals) this interim final rule will reduce human 
risk by reducing human exposure to infectious materials (i.e., 
prohibited cattle materials).
2. Interim Final Rule Coverage
    This interim final rule prohibits the use of ``prohibited cattle 
materials.'' These include SRMs (brain, skull, eyes, trigeminal 
ganglia, spinal cord, vertebral column (excluding the vertebrae of the 
tail, the transverse process of the thoracic and lumbar vertebrae, and 
the wings of the sacrum), and dorsal root ganglia of cattle 30 months 
and older (including rendering of these materials), and the tonsils and 
distal ileum of the small intestine of all cattle), small intestine of 
all cattle, tissue from nonambulatory disabled cattle, tissue from 
cattle not inspected and passed for human consumption, and MS(Beef) in 
all FDA-regulated human food and cosmetics.
    Under this interim final rule, tallow with no more than 0.15 
percent hexane-insoluble impurities or that meets the requirements of 
Sec.  189.5(b) (human food) or Sec.  700.27(b) (cosmetics) may be used 
in food or cosmetics. In addition, tallow derivatives are exempt from 
the requirements of this rulemaking. The provisions for tallow and 
tallow derivatives in this interim final rule are in accordance with 
the best guidance from the OIE and FDA's TSEAC. The interim final rule 
provides in Sec. Sec.  189.5(c) and 700.27(c) that manufacturers and 
processors of human food or cosmetics that are manufactured from, 
processed with, or otherwise contains cattle material must make records 
relevant to compliance with this rule available to FDA for inspection 
and copying.
3. Regulatory Options Considered
    In response to the concern over BSE in food and cosmetics, FDA 
considered three regulatory options:
     No new regulation (baseline).
     Prohibit the use of prohibited cattle materials in human 
food and cosmetics and require access to existing records relevant to 
determine compliance.
     Prohibit the use of prohibited cattle materials in human 
food and cosmetics and require establishment, maintenance, and access 
to records demonstrating that prohibited cattle materials are not used 
in human food and cosmetics.
    Option 1: No new regulation.We use this option as the baseline. By 
definition, no costs and benefits are associated with the baseline.
    Option 2: Prohibit the use of prohibited cattle materials in human 
food and cosmetics and require access to existing records relevant to 
determining compliance.
    This option would prohibit the use of prohibited cattle materials 
in all FDA-regulated food, including dietary supplements, and 
cosmetics, and would require that manufacturers and processors make 
existing records related to compliance with the rule available to FDA 
for inspection and copying.
    The prohibition would cover the same materials prohibited by the 
FSIS interim final rule and also materials from cattle that are not 
inspected and passed for human consumption. Because SRMs, small 
intestine of all cattle, nonambulatory disabled cattle and MS(Beef) are 
subject to the USDA's disposition requirements (e.g., destruction or 
rendering for purposes other than human food), we assume that generally 
these materials are not likely to be widely available for use in the 
manufacture of FDA-regulated human food and cosmetics. The 
manufacturers and processors of products currently using materials that 
are considered SRMs (e.g., the brain, skull, spinal cord) would 
presumably be able to continue to use these ingredients, but 
exclusively from cattle younger than 30 months of age. The 
manufacturers of FDA-regulated human food products that use rendered 
material would continue to use rendered material that is the product of 
edible rendering (e.g., edible tallow). The manufacturers and 
processors of products using the tonsils and the small intestine of all 
cattle, material from nonambulatory disabled cattle, material from 
cattle not inspected and passed for human consumption, and MS(Beef) 
would need to find substitutes for these ingredients. We assume that 
the recent USDA rulemaking has already led many of these manufacturers 
to search for alternative ingredients.
    We do not have adequate information to quantify the cost of 
ingredient switching for human foods and request data on this subject. 
To the extent that this option leads to increased use of alternative 
ingredients, exposure to prohibited cattle materials will be reduced. 
Without a complete records requirement, however, the incentives to 
ensure that alternative ingredients are used are reduced. Access to 
existing records, as required by this option, would not increase the 
costs of this interim final rule, but would be beneficial in ensuring 
that acceptable cattle material is used in the manufacture of food and 
cosmetics.
    Manufacturers of cosmetics that currently use inedible rendered 
materials, including tallow containing more than 0.15 percent hexane-
insoluble impurities, would have to find alternative ingredients. We 
assume that they would switch to edible cattle rendered material, or 
perhaps non-cattle inedible rendering, to continue production. While we 
do not have

[[Page 42267]]

specific price information for all cattle material, edible or inedible, 
used in cosmetics, we were able to determine that prime edible tallow 
from cattle is 4 cents more per pound than inedible tallow from cattle 
($0.1575 per lb. vs. $0.1975 per lb.) (Ref. 52). In comparison, the 
alternative fats white grease and yellow grease are less expensive than 
even inedible tallow ($0.01 to $0.02 per lb. less), while lard is more 
expensive than edible tallow ($0.06 more per lb.).
    Because edible cattle material is more expensive than inedible 
material, the costs for inputs into cosmetic production would increase 
for those producers that currently use inedible cattle material and 
must switch to edible cattle material. FDA does not have information on 
the specific number of ingredient substitutions that will be made in 
cosmetics production as a result of this interim final rule. We assume 
that the increased costs of edible cattle material as an ingredient in 
cosmetic production would, at least in part, be passed along to 
cosmetics' consumers in the form of higher prices for finished 
products. It is unlikely that the price increases for the cosmetic 
inputs or for the finished products would be large enough to 
substantially decrease the amounts of the affected products sold. FDA 
requests comments on this assumption.
    Even though FDA does not have a specific list of cosmetics that 
currently use inedible rendering as an input in production, we do have 
information from the year 2000 on the U.S. consumption of inedible 
tallow and greases used in soap, lubricants, and fatty acids (Ref. 53). 
We expect that these three ingredients represent a good portion of the 
inedible rendering that is used to produce cosmetics.
    Tallow is the generally accepted term for the rendered fat from 
ruminant carcasses, while grease is a more generic term that could be 
used to describe rendered pork fat (white grease), used restaurant 
grease (yellow grease), or lower quality tallow (also called yellow 
grease). To estimate the portion of inedible tallow from cattle in the 
inedible tallow and greases category, we looked at the percentage of 
total production of inedible tallow and greases that represented 
inedible tallow for the year 2000, and found that inedible tallow 
represented 54 percent of the mixture.
    Table 1 of this document shows the usage of inedible tallow and 
greases by category (soap, lubricant, or fatty acid), the consumption 
that represents the cattle portion of the material (inedible tallow) 
and the calculated additional costs--about $18 million--of these 
potential cosmetic inputs. The cost of cosmetic ingredient switching 
shown in table 1 represents an upper bound estimate of costs. Some 
cosmetic products likely use tallow derivatives, exempt from this 
rulemaking, or already use cattle-derived ingredients that are 
considered edible. Because we do not have precise information on how 
many cosmetic products use tallow with more than the maximum level of 
insoluble impurities or other inedible cattle material as ingredients, 
we estimate the costs of cosmetic ingredient switching to be between $0 
and $18 million.

                        Table 1.--Inedible Tallow usage & Price Premium for Edible Tallow
----------------------------------------------------------------------------------------------------------------
   U.S. Consumption of
    Inedible Tallow &                  lbs                Consumption in lbs That      Price Premium for Edible
      Greases, 2000                                        represents Tallow Only         Tallow = $0.04/lb
----------------------------------------------------------------------------------------------------------------
Total inedible Tallow       3,654,200,000               ...........................  ...........................
and greases usage
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------

    Regulatory option 2 would decrease the likelihood of human exposure 
to BSE in several ways. First, by making clear that prohibited cattle 
material cannot be used in FDA-regulated human food and cosmetics, 
option 2 would create an additional regulatory barrier, beyond existing 
regulations, between consumers and food and cosmetics potentially 
contaminated with BSE. Second, by deeming human food and cosmetics 
manufactured from, processed with, or otherwise containing, prohibited 
cattle materials to be adulterated, option 2 would clarify FDA's 
ability to prohibit importation of prohibited cattle materials. 
Imported products, such as gelatin, beef extracts, and dietary 
supplements, may contain the types of materials prohibited by the USDA, 
but may not fall under the scope of the USDA's import restrictions.
    The benefits of this interim final rule are the value of the public 
health benefits. The public health benefit is the reduction in the risk 
of the human illness associated with consumption of the agent that 
causes BSE.
    If we define the baseline risk as the expected annual number of 
cases of vCJD per year, then the annual benefits of prohibiting 
prohibited cattle materials for use in foods and cosmetics would be:
    (baseline annual cases of vCJD - annual cases of vCJD under FDA 
interim final rule) x (value of preventing a case of vCJD).
    An alternative way to characterize benefits is:
    Reduction in annual cases in vCJD under FDA interim final rule x 
(value of preventing a case of vCJD)
    We do not know the baseline expected annual number of cases, but 
based on the epidemiology of vCJD in United Kingdom we anticipate much 
less than one case of vCJD per year in the United States. Because the 
interim final rule will reduce rather than eliminate risk of exposure 
to BSE infectious materials, the reduction in the number of cases will 
be some fraction of the expected number. The value of preventing a case 
of vCJD is the value of a statistical life plus the value of preventing 
a year-long or longer illness that precedes certain death for victims 
of vCJD. In a recent rulemaking regarding labeling of trans fatty acids 
(68 FR 41433, July 11, 2003), we used a range of $5 to $6.5 million for 
the value of a statistical life. The value of preventing a vCJD case 
would be even higher because of the significant medical costs 
associated with the illness (Ref. 54). We estimate that the value of 
preventing a single case of vCJD ranges

[[Page 42268]]

from $5.7 to $7.1 million. This estimate includes direct medical costs, 
reduced ability of the ill person to function at home and at work, and 
the cost of premature death.
    As discussed earlier in this document, the Harvard-Tuskegee study 
has stated that a ban on specified risk materials, including cattle 
brains, spinal cord and vertebral column, from inclusion in human and 
animal food would reduce the very few potential BSE cases in cattle by 
a further 88 percent and potential human exposure to infectivity in 
meat and meat products by a further 95 percent. This interim final 
rule, in conjunction with the USDA's interim final rule, will help 
achieve this reduction in potential human exposure. This interim final 
rule will also reduce potential human exposure to BSE infection in 
human food not covered by the Harvard-Tuskegee study. For example, this 
interim final rule will help ensure that a domestically produced or 
foreign-produced dietary supplement or ingredient contains cattle 
material (e.g., brain) from animals of an appropriate age.

Summary of Costs and Benefits of Interim Final Rule

    The social cost of this interim final rule, which we approximate by 
multiplying the difference in ingredient prices by the pre-regulation 
quantity of ingredients, will be borne by producers and consumers of 
affected products. If demand is inelastic compared with supply, 
consumers will bear most of the social cost. If supply is inelastic 
compared with demand, producers will bear most of the social cost. The 
ready availability of alternatives for the prohibited ingredients, and 
the small number of products currently using them, implies that the 
social costs of this rule will likely be small for foods. The social 
costs for cosmetics will be greater. We estimate that the cost of 
ingredient switching for cosmetics will range from a lower bound of $0 
to an upper bound of $18 million. The benefit of this interim final 
rule is that its requirements will--by reducing exposure to potentially 
infective materials--provide a safeguard against a case of vCJD 
occurring in humans if cattle infected with BSE enter the human food or 
cosmetic supply.
    Option 3: Prohibit the use of prohibited cattle materials in human 
food and cosmetics and require establishment, maintenance, and access 
to records demonstrating that prohibited cattle materials are not used 
in human food and cosmetics.
    Option 3, like option 2, prohibits the use of prohibited cattle 
materials in human food, including dietary supplements, and cosmetics. 
We explained in the discussion of option 2 that the USDA's prohibitions 
are not sufficient, by themselves, to ensure that prohibited cattle 
materials are not used in FDA-regulated food and cosmetics. Therefore, 
FDA must be able to determine whether prohibited cattle materials are 
used in the human food and cosmetics it regulates. Option 3 requires 
manufacturers and processors of FDA-regulated human food and cosmetics 
manufactured from, processed with, or otherwise containing cattle 
material to establish, maintain, and provide access to records 
documenting that prohibited cattle materials are not used in their 
products. Under this option, records would not be not required for 
human food or cosmetics containing tallow derivatives because tallow 
derivatives are not prohibited cattle material. The marginal difference 
between options 2 and 3 presented in this interim final rule is the 
requirements to establish and maintain records for cattle-derived 
materials in Option 3. The requirement of records for cattle-derived 
materials is the subject of an FDA proposed rulemaking published 
elsewhere in this issue of the Federal Register. Thus, Option 3 of this 
interim final rule represents the impacts of the requirements for the 
interim final rule and for the proposed recordkeeping requirement. The 
impact of only the recordkeeping requirement for cattle-derived 
materials used in food and cosmetics is fully explained elsewhere in 
this issue of the Federal Register.
    Without these records, FDA may not be able to determine the age of 
cattle material, such as brain or spinal cord, once it is separated 
from the source animal. In addition, without records, the agency may 
not be able to determine the inspectional status of the source animals. 
This regulatory option would require that the manufacturer or processor 
retain records for 2 years after using cattle material in food or 
cosmetics. Records must be kept at the manufacturing or processing 
establishment or another reasonably accessible location.
    The costs of option 3 are the $0 to $18 million ingredient 
switching costs calculated for option 2, plus the recordkeeping costs. 
We assume that some records must be created for each shipment of 
materials from a slaughterhouse or rendering facility to an FDA-
regulated facility. We also assume that all supporting information is 
known by the slaughter or rendering facility. The USDA's interim final 
rule requires that establishments that slaughter cattle or that process 
the carcasses or parts of carcasses of cattle maintain daily records 
sufficient to document the implementation and monitoring of procedures 
for removal, segregation, and disposition of SRMs.
    Although most FDA-regulated human food does not use a large 
quantity of cattle material, certain products contain substantial 
amounts. Some fats and oils (e.g., oleo margarine and shortening) use 
edible tallow and its derivatives; ice cream, yogurt, candies, 
flavorings, marshmallows, and mayonnaise use gelatin; and some soups, 
mixed entrees, cake mixes and pasta use a range of cattle material 
(Refs. 55 and 56).
    Using establishment data from the FDA Small Business Model (which 
includes information on all establishments in a manufacturing sector 
regardless of size) (Ref. 57), FDA estimated that 132 establishments 
produce fats and oils, 181 establishments produce spreads, 127 
establishments produce flavoring extracts, 40 establishments produce 
canned soups and stews, 625 establishments produce non-chocolate candy, 
88 establishments produce yogurt, and 451 establishments produce ice 
cream. FDA cannot verify that all of these establishments actually use 
cattle materials that fall under the jurisdiction of this interim final 
rule; many may not. It is likely that all of the 132 establishments 
that produce fats and oils currently use tallow derivatives, not 
tallow, so FDA assumes that no records would be required to be kept by 
this establishment group. We assume that only 25 percent of the 
establishments from the remaining production sectors listed previously 
actually produce human food that is manufactured from, processed with, 
or otherwise contains material from cattle and therefore would be 
required to keep records under this option. We include only 25 percent 
of the establishments in our estimates because most of the 
manufacturers likely do not use cattle-derived ingredients in their 
products. FDA requests comments on this assumption.
    FDA research shows that 25 establishments with U.S. addresses 
supply cattle-derived ingredients that are used in cosmetics (Ref. 58). 
These cattle-derived ingredients include albumin, brain extract, brain 
lipids, cholesterol and cholesterol compounds, fibronectin, 
sphingolipids, spleen extract, tallow, and keratin and keratin 
compounds. FDA research also shows that 22 foreign establishments may 
export these cattle-derived ingredients to U.S. cosmetic manufacturers. 
The U.S. cosmetic manufacturers would be required to obtain records 
from the foreign establishments under this

[[Page 42269]]

option. We therefore include these foreign establishments when we 
estimate the recordkeeping costs of the regulatory options in the 
interim final rule. Imported cosmetic products represent about 10 to 20 
percent of the cosmetics products on U.S. store shelves (Refs. 59, 60, 
and 61). The burden of this interim final rule to foreign cosmetics 
input suppliers and manufacturers will be less than the burden on 
domestic cosmetics producers. The burden will be less for foreign 
cosmetics manufacturers because Europe currently imposes some 
requirements similar to this rule.
    FDA does not have enough information on the types of cattle 
material used by the 47 domestic and foreign cosmetics establishments 
to know how often tallow derivatives (exempt from the definition of 
prohibited cattle materials and, therefore, exempt from the 
requirements under this option) are the only cattle-derived ingredient 
used in these products. We estimate that 75 percent (or 35) of the 47 
cosmetics establishments would have to keep records for their cattle-
derived ingredients. We estimate that only 75 percent will keep records 
because many cosmetics use tallow derivatives as their only cattle-
derived material and such materials are exempt from this rulemaking. 
FDA requests comments on this assumption.
    From FDA's dietary supplement database (Ref. 62), we are able to 
tell that there are 162 dietary supplement brand names that use cattle 
material as ingredients in their products. We assume that each brand 
name represents a facility that produces multiple dietary supplement 
products containing cattle-derived ingredients; therefore we assess 
recordkeeping costs for all 162 brand names. We do not have information 
to determine if any of the dietary supplement manufacturers use tallow 
derivatives (exempt from all requirements under this option) as their 
only cattle-derived ingredient.

Recordkeeping Costs

    The USDA's BSE interim final rule requires those establishments 
that slaughter cattle or that process the carcasses or parts of 
carcasses of cattle maintain daily records sufficient to document the 
implementation and monitoring of procedures for removal, segregation, 
and disposition of SRMs. This USDA requirement would reduce the startup 
costs of the recordkeeping required under this option.
    Recordkeeping costs include one-time costs and recurring costs. 
One-time costs include the costs of designing records and training 
personnel in the maintenance of the records. The recurring costs are 
the costs of ensuring that appropriate records document the absence of 
prohibited cattle risk materials in human food and cosmetics. The costs 
of retaining records and planning for an FDA request for records access 
are estimated to be zero. We estimate these costs to be zero becasue 
current business practices already dictate that records for a second 
year is assumed to be greater than the marginal cost of doing so. 
Although there is no specific time period for providing records when 
requested, FDA notes that records requestes costs are zero when FDA 
gives the records submitter 24 hours to comply. These cost estimates 
are consistent with cost estimates used in FDA's proposed recordkeeping 
requirements in ``Establishment and Maintenance of Records Under the 
Public Health Security and Bioterrorism Preparedness and Response Act 
of 2002'' (68 FR 25188, May 9, 2003).
    We assume that the one-time training burden incurred for each 
facility is the equivalent of 1 month's on-the-job training or 
approximately 1/3 of an hour. This time includes both the training 
required for personnel to learn how to verify that shipments contain 
the appropriate records, and also the training required for personnel 
to learn how to file and maintain those records. Given current business 
practices, we know personnel are familiar with recordkeeping. 
Therefore, the requirement to maintain additional records is expected 
to be learned quickly. This training burden for recordkeeping is 
consistent with the recordkeeping training burden in the analysis for 
the proposed recordkeeping rule (68 FR 25188; May 9, 2003) and the 
records maintenance burden used in the analysis of the Juice HACCP rule 
(66 FR 6138; January 19, 2001). Consistent with the analysis conducted 
for the proposed recordkeeping rule (68 FR 25188; May 9, 2003), FDA 
assumes an hourly cost of an administrative worker, $25.10 per hour, 
which has been doubled from $12.55 wage per hour to include overhead 
costs. This cost, $25.10 per hour, applies to all labor costs.
    We use the FDA Labeling Cost Model to estimate the one-time records 
design costs per facility of $1,190 per stockkeeping unit (SKU) (Ref. 
63). It is likely that facilities using cattle-derived ingredients, 
whether the ingredients are for human food or cosmetics, will take 
advantage of their economies of scope and produce more than one product 
with these ingredients. It is probable that each establishment has 
several SKUs associated with products containing cattle-derived 
ingredients that will now require recordkeeping. To account for 
additional products and SKUs we multiply the record design costs per 
facility by 1.5 for a total design cost per facility of $1,785 ($1,095 
in labor costs and $690 in capital costs).
    We multiplied the cost per product per SKU by 1.5 to account for 
the additional records design required for the additional SKUs. The 
record design cost for the first affected product or SKU will be more 
expensive than the marginal cost of adding records for additional SKUs. 
This marginal cost of record design for additional SKUs could be 
negligible or it could come close to doubling the costs; we therefore 
pick 1.5, the midpoint of one and two, to be the cost multiplier.
    Consistent with the analysis conducted for the proposed 
recordkeeping rule implementing the 2002 Bioterrorism Act, this record 
design cost is assumed to be shared between two facilities--the 
upstream facility and the downstream facility--as both will need to be 
involved in record production that meets the needs of both the supplier 
and customer for the cattle-derived ingredient.
    Unlike the Bioterrism Act proposed recordkeeping rule, we do not 
have direct information on all the facilities covered; we do not have 
data on the number of slaughter plants or renderers that supply cattle 
material for human food and cosmetic manufacturers and processors under 
FDA jurisdiction. FDA does, however, have some information on the 
number and type of downstream facilities that receive this material. 
Using information on the number of human food and cosmetic 
manufacturers that may use cattle-derived ingredients subject to this 
interim final rule, we can account for the total shared records costs 
by assuming that each food manufacturer or processor facility listed in 
the table below procures ingredients from one upstream slaughter plant 
or renderer. We assume each manufacturing facility maintains an 
exclusive contractual relationship with one ingredient supplier for 
calculation purposes. Even if multiple input suppliers are utilized by 
the manufacturing facility, the marginal record set-up costs would 
decrease for additional suppliers. Once the facility has learned what 
records are required, it is less costly to keep records on additional 
input suppliers. FDA requests comment on this assumption.
    Information on food producing facilities in Table 2 represent U.S. 
facilities; dietary supplement numbers account for both domestic and 
foreign facilities; cosmetics numbers account

[[Page 42270]]

for both domestic and foreign input suppliers.

                                       Table 2.--First-Year Records Costs
----------------------------------------------------------------------------------------------------------------
                                                                       Costs Per Facility
  Type of Product Using   Number of Facilities   Costs Per Facility     for Training (1/3
     Cattle Material        Estimated to Use        for Designing       hour * $25.10 per     Total Setup Costs
                            Cattle Materials           Records                hour)
----------------------------------------------------------------------------------------------------------------
Canned soups and stews            10                $1,785                    $8.37            $17,934
----------------------------------------------------------------------------------------------------------------
Fats and oils                      0            ....................  ....................  ....................
----------------------------------------------------------------------------------------------------------------
Flavoring extracts                32                $1,785                    $8.37            $57,388
----------------------------------------------------------------------------------------------------------------
Spreads                           45                $1,785                    $8.37            $80,702
----------------------------------------------------------------------------------------------------------------
Candy                            156                $1,785                    $8.37           $279,766
----------------------------------------------------------------------------------------------------------------
Yogurt                            22                $1,785                    $8.37            $39,454
----------------------------------------------------------------------------------------------------------------
Ice cream                        113                $1,785                    $8.37           $202,651
----------------------------------------------------------------------------------------------------------------
Dietary supplements              162                $1,785                    $8.37           $290,526
----------------------------------------------------------------------------------------------------------------
Cosmetics                         35                $1,785                    $8.37            $62,768
----------------------------------------------------------------------------------------------------------------
Color additives                    0            ....................  ....................  ....................
----------------------------------------------------------------------------------------------------------------
Total                            575                $1,785                    $8.37         $1,031,189
----------------------------------------------------------------------------------------------------------------

    The recurring recordkeeping cost is the cost of ensuring that 
appropriate records document the absence of prohibited cattle materials 
in human food and cosmetics.
    The framework for estimating the amount of time required for FDA-
regulated facilities to ensure that the records for each shipment of 
materials is based on the regulatory impact analysis of the proposed 
recordkeeping requirements in ``Establishment and Maintenance of 
Records Under the Public Health Security and Bioterrorism Preparedness 
and Response Act of 2002.'' In that analysis we estimated that 30 
minutes per week would be required to ensure that records on each 
shipment to and from a facility contain adequate information of the 
contents of the package, as well as adequate information on the 
transporter, supplier, and receiver.
    The recordkeeping requirements of this regulatory option will cover 
only a small fraction of all ingredients used in the human food and 
cosmetic manufacturing processes and only require that records of 
cattle-derived ingredient origin from the input supplier be verified 
and maintained by a food or cosmetic manufacturer or processor. Because 
this recordkeeping requirement is less complex than the recordkeeping 
requirements under the Bioterrorism Act and affects fewer ingredients, 
we estimate the per facility burden to be about one-half of the burden 
estimated for the Bioterrorism Act recordkeeping rule (68 FR 25188, May 
9, 2003): 15 minutes per week, or 13 hours per year. FDA assumes that 
this recordkeeping burden will be shared between two entities (i.e., 
the slaughter plant and the manufacturer or processor of finished 
products containing cattle-derived ingredients).
    Table 3 shows the recurring recordkeeping costs for human food and 
cosmetic manufacturers and processors. As stated earlier, information 
on food producing facilities in Table 3 represents U.S. facilities; 
dietary supplement numbers account for both domestic and foreign 
facilities; cosmetics numbers account for both domestic and foreign 
input suppliers.

                                    Table 3.--Recurring Annual Records Costs
----------------------------------------------------------------------------------------------------------------
                                                                        Annual Costs Per
                                                                      Facility of Ensuring
                                                                        That Appropriate
Type of Product (From Raw or Rendered Material  Number of Facilities    Records Accompany      Total Recurring
    That Needs Accompanying Documentation)                                Each Shipment         Annual Costs
                                                                      Received (13 hours *
                                                                          $25.10/hour)
----------------------------------------------------------------------------------------------------------------
Canned soups and stews                                  10                  $326.30             $3,263
----------------------------------------------------------------------------------------------------------------
Fats and oils                                            0            ....................  ....................
----------------------------------------------------------------------------------------------------------------
Flavoring extracts                                      32                  $326.30            $10,442
----------------------------------------------------------------------------------------------------------------
Spreads                                                 45                  $326.30            $14,684
----------------------------------------------------------------------------------------------------------------
Candy                                                  156                  $326.30            $50,903
----------------------------------------------------------------------------------------------------------------
Yogurt                                                  22                  $326.30             $7,179
----------------------------------------------------------------------------------------------------------------

[[Page 42271]]

 
Ice Cream                                              113                  $326.30            $36,872
----------------------------------------------------------------------------------------------------------------
Dietary supplements                                    162                  $326.30            $52,861
----------------------------------------------------------------------------------------------------------------
Cosmetics                                               35                  $326.30            $11,421
----------------------------------------------------------------------------------------------------------------
Color additives                                          0            ....................  ....................
----------------------------------------------------------------------------------------------------------------
Total                                                  575                  $326.30           $187,625
----------------------------------------------------------------------------------------------------------------

    The benefits of this option are the same as the benefits of option 
2--the value of the public health benefits. The public health benefit 
is the reduction in the risk of the human illness associated with 
consumption of the agent that causes BSE. With this option, however, 
requiring the establishment and maintenance of records provides an 
additional safeguard to prevent exposure to potentially infected 
materials.

B. Regulatory Flexibility Analysis

    FDA has examined the economic implications of this interim final 
rule as required by the Regulatory Flexibility Act (5 U.S.C. 601-612). 
If a rule has a significant economic impact on a substantial number of 
small entities, the Regulatory Flexibility Act requires agencies to 
analyze regulatory options that would lessen the economic effect of the 
rule on small entities. FDA does not believe that this interim final 
rule will have a significant economic impact on a substantial number of 
small entities.
    For this interim final rule, the only cost is for those human food 
and cosmetic facilities that will need to switch to alternative 
ingredients. While food facilities may incur search costs as well as 
higher ingredient costs, the ready availability of alternatives for 
prohibited ingredients, and the small number of products currently 
using them, implies that these costs will be negligible for foods.
    Cosmetic facilities are more likely than food facilities to 
experience substantial ingredient switching costs as a result of this 
interim final rule. As shown previously, we estimate that 35 cosmetics 
establishments will be affected by this interim final rule. If 
ingredient switching costs are closer to FDA's estimated upper bound of 
$18 million than to the lower bound of 0, the average cost per 
establishment will be about $500,000. We do not know if any of the 
affected establishments are small businesses. This cost would, however, 
be a significant economic impact for small cosmetics businesses. If the 
actual costs are closer to the lower bound, then the economic impact 
will not be significant.
    Because switching ingredients is the source of the reduction in 
exposure to potentially infective materials, it is necessary to apply 
the rule's provisions to all establishments equally. We have, however, 
allowed small businesses some flexibility by not requiring the 
establishment and maintenance of records in this interim final rule. In 
a companion rulemaking, we propose record establishment and maintenance 
requirements and ask for comments on their effect on small businesses.

C. Unfunded Mandates

    Title II of the Unfunded Mandates Reform Act of 1995 (Public Law 
104-4) requires cost-benefit and other analyses before any rulemaking 
if the rule would include a ``Federal mandate that may result in the 
expenditure by State, local, and tribal governments, in the aggregate, 
or by the private sector, of $100,000,000 or more (adjusted annually 
for inflation) in any 1 year.'' The current inflation-adjusted 
statutory threshold is $115 million. FDA has determined that this 
interim final rule does not constitute a significant rule under the 
Unfunded Mandates Reform Act.

D. SBREFA Major Rule

    The Small Business Regulatory Enforcement Fairness Act of 1996 
(Public Law 104-121) defines a major rule for the purpose of 
congressional review as having caused or being likely to cause one or 
more of the following: An annual effect on the economy of $100 million 
or more; a major increase in costs or prices; significant adverse 
effects on competition, employment, productivity, or innovation; or 
significant adverse effects on the ability of U.S.-based enterprises to 
compete with foreign-based enterprises in domestic or export markets. 
In accordance with the Small Business Regulatory Enforcement Fairness 
Act, the Office of Management and Budget (OMB) has determined that this 
interim final rule is not a major rule for the purpose of congressional 
review.

VII. Paperwork Reduction Act Analysis

    This interim final rule does not contain information collection 
provisions that are subject to review by the OMB under the Paperwork 
Reduction Act of 1995 (44 U.S.C. 3501-3520). Therefore, clearance by 
OMB under the Paperwork Reduction Act of 1995 is not required.

VIII. Environmental Impact Analysis

    FDA has carefully considered the potential environmental effects of 
this interim final rule and of three possible alternative actions. In 
doing so, the agency focused on the environmental impacts of its action 
as a result of disposal of unused cattle byproducts (e.g., dead animals 
and slaughter byproducts) that need to be handled after the rule 
becomes effective.
    The environmental assessment (EA) considered each of the 
alternatives in terms of the need to provide maximum reasonable 
protection of human health without resulting in a significant impact on 
the environment. The EA considered environmental impacts related to 
landfill, incineration, composting, and land burial. The additional 
waste that might result from the selected action would be an extremely 
small amount compared to the total amount of waste generated by the 
cattle industry.
    The agency has concluded that the interim final rule will not have 
a significant impact on the human environment, and that an 
environmental impact statement is not required. FDA's finding of no 
significant impact (FONSI) and the evidence supporting that finding, 
contained in an EA prepared

[[Page 42272]]

under 21 CFR 25.40, may be seen in the Division of Dockets Management 
(see ADDRESSES) between 9 a.m. and 4 p.m., Monday through Friday. FDA 
invites comments and submission of data concerning the EA and FONSI.

IX. Federalism

    We have analyzed this interim final rule in accordance with the 
principles in Executive Order 13132. We have determined that the 
interim final rule does not contain policies that have substantial 
direct effects on the states, on the relationship between the National 
Government and the States, or on the distribution of power and 
responsibilities among the various levels of government. Accordingly, 
we have concluded that the interim final rule does not contain policies 
that have federalism implications as defined in the Executive order 
and, consequently, a federalism summary impact statement has not been 
prepared.

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List of Subjects

21 CFR Part 189

    Food additives, Food packaging, Incorporation by reference.

21 CFR Part 700

    Cosmetics, Packaging and containers, Incorporation by reference.

0
Therefore, under the Federal Food, Drug, and Cosmetic Act, and under 
authority delegated to the Commissioner of Food and Drugs, 21 CFR parts 
189 and 700 are amended as follows:

PART 189--SUBSTANCES PROHIBITED FROM USE IN HUMAN FOOD

0
1. The authority citation for 21 CFR part 189 continues to read as 
follows:

    Authority: 21 U.S.C. 321, 342, 348, 371.

0
2. Part 189 is amended by redesignating subparts B and C as subparts C 
and D, respectively, and by adding a new subpart B to read as follows:
Subpart B--Prohibited Cattle Materials
Sec.
189.5 Prohibited cattle materials.
Subpart B--Prohibited Cattle Materials


Sec.  189.5  Prohibited cattle materials.

    (a) Definitions. The definitions and interpretations of terms 
contained in section 201 of the Federal Food, Drug, and Cosmetic Act 
(the act) apply to such terms when used in this part. The following 
definitions also apply:
    (1) Prohibited cattle materials means specified risk materials, 
small intestine of all cattle, material from nonambulatory disabled 
cattle, material from cattle not inspected and passed, or MS(Beef). 
Prohibited cattle materials do not include tallow that contains no more 
than 0.15 percent hexane-insoluble impurities and tallow derivatives.
    (2) Inspected and passed means that the product has been inspected 
and passed for human consumption by the appropriate regulatory 
authority, and at the time it was inspected and passed, it was found to 
be not adulterated.
    (3) Mechanically Separated (MS)(Beef) means a meat food product 
that is finely comminuted, resulting from the mechanical separation and 
removal of most of the bone from attached skeletal muscle of cattle 
carcasses and parts of carcasses, that meets the specifications 
contained in 9 CFR 319.5, the regulation that prescribes the standard 
of identity for MS (Species).
    (4) Nonambulatory disabled cattle means cattle that cannot rise 
from a recumbent position or that cannot walk, including, but not 
limited to, those with broken appendages, severed tendons or ligaments, 
nerve paralysis, fractured vertebral column or metabolic conditions.
    (5) Specified risk material means the brain, skull, eyes, 
trigeminal ganglia, spinal cord, vertebral column (excluding the 
vertebrae of the tail, the transverse processes of the thoracic and 
lumbar vertebrae, and the wings of the sacrum), and dorsal root ganglia 
of cattle 30 months and older and the tonsils and distal ileum of the 
small intestine of all cattle.
    (6) Tallow means the rendered fat of cattle obtained by pressing or 
by applying any other extraction process to tissues derived directly 
from discrete adipose tissue masses or to other carcass parts and 
tissues. Tallow must be free of prohibited cattle material or must 
contain not more than 0.15 percent hexane-insoluble impurities as 
determined by the method for ``hexane-insoluble matter,'' p. 465, in 
the ``Food Chemicals Codex,'' 5th Ed. (2004), incorporated by reference 
in accordance with 5 U.S.C. 552(a) and 1 CFR part 51, or another method 
equivalent in accuracy, precision, and sensitivity to the method in the 
Food Chemicals Codex. You may obtain copies of the method from the 
National Academy Press, 2101 Constitution Ave. NW., Washington, DC 
20418 (Internet address http://www.nap.edu) and the Division of Dairy 
and Egg Safety (HFS-306), Center for Food Safety and Applied Nutrition, 
Food and Drug Administration, 5100 Paint Branch Pkwy., College Park, MD

[[Page 42274]]

20740. Copies may be examined at the Center for Food Safety and Applied 
Nutrition's Library, 5100 Paint Branch Pkwy., College Park, MD 20740, 
or at the National Archives and Records Administration (NARA). For 
information on the availability of this material at NARA, call 202-741-
6030, or go to: http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (7) Tallow derivative means any chemical obtained through initial 
hydrolysis, saponification, or trans-esterification of tallow; chemical 
conversion of material obtained by hydrolysis, saponification, or 
trans-esterification may be applied to obtain the desired product.
    (b) Requirements. No human food shall be manufactured from, 
processed with, or otherwise contain, prohibited cattle materials.
    (c) Records. Manufacturers and processors of human food that is 
manufactured from, processed with, or otherwise contains, cattle 
material must make existing records relevant to compliance with this 
section available to FDA for inspection and copying.
    (d) Adulteration. (1) Failure of a manufacturer or processor to 
operate in compliance with the requirements of paragraphs (b) or (c) of 
this section renders human food adulterated under section 402(a)(4) of 
the act.
    (2) Human food manufactured from, processed with, or otherwise 
containing, prohibited cattle materials is unfit for human food and 
deemed adulterated under section 402(a)(3) of the act.
    (3)Food additive status. Prohibited cattle materials for use in 
human food are food additives subject to section 409 of the act, except 
when used as dietary ingredients in dietary supplements. The use or 
intended use of any prohibited cattle material in human food causes the 
material and the food to be adulterated under section 402(a)(2)(C) of 
the act if the prohibited cattle material is a food additive, unless it 
is the subject of a food additive regulation or of an investigational 
exemption for a food additive under Sec.  170.17 of this chapter.

PART 700--GENERAL

0
3. The authority citation for 21 CFR part 700 continues to read as 
follows:

    Authority: 21 U. S. C. 321, 331, 352, 355, 361, 362, 371, 374.

0
4. Section 700.27 is added to read as follows:


Sec.  700.27  Use of prohibited cattle materials in cosmetic products.

    (a) Definitions. The definitions and interpretations of terms 
contained in section 201 of the act apply to such terms when used in 
this part. The following definitions also apply:
    (1) Prohibited cattle materials means specified risk materials, 
small intestine of all cattle, material from nonambulatory disabled 
cattle, material from cattle not inspected and passed, or MS(Beef). 
Prohibited cattle materials do not include tallow that contains no more 
than 0.15 percent hexane-insoluble impurities and tallow derivatives.
    (2) Inspected and passed means that the product has been inspected 
and passed for human consumption by the appropriate regulatory 
authority, and at the time it was inspected and passed, it was found to 
be not adulterated.
    (3) Mechanically Separated (MS)(Beef) means a meat food product 
that is finely comminuted, resulting from the mechanical separation and 
removal of most of the bone from attached skeletal muscle of cattle 
carcasses and parts of carcasses that meet the specifications contained 
in 9 CFR 319.5, the regulation that prescribes the standard of identity 
for MS (Species).
    (4) Nonambulatory disabled cattle means cattle that cannot rise 
from a recumbent position or that cannot walk, including, but not 
limited to, those with broken appendages, severed tendons or ligaments, 
nerve paralysis, fractured vertebral column or metabolic conditions.
    (5) Specified risk material means the brain, skull, eyes, 
trigeminal ganglia, spinal cord, vertebral column (excluding the 
vertebrae of the tail, the transverse processes of the thoracic and 
lumbar vertebrae, and the wings of the sacrum), and dorsal root ganglia 
of cattle 30 months and older and the tonsils and distal ileum of the 
small intestine of all cattle.
    (6) Tallow means the rendered fat of cattle obtained by pressing or 
by applying any other extraction process to tissues derived directly 
from discrete adipose tissue masses or to other carcass parts and 
tissues. Tallow must be free of prohibited cattle risk material or must 
contain not more than 0.15 percent hexane-insoluble impurities 
determined by the method for ``hexane-insoluble matter,'' p. 465, in 
the ``Food Chemicals Codex,'' 5th Ed. (2004), incorporated by reference 
in accordance with 5 U.S.C. 552(a) and 1 CFR part 51, or another method 
equivalent in accuracy, precision and sensitivity to the method in the 
Food Chemicals Codex.. You may obtain copies of the method from the 
National Academy Press, 2101 Constitution Ave. NW., Washington, DC 
20418 (Internet address http://www.nap.edu) and the Division of Dairy 
and Egg Safety (HFS-306), Center for Food Safety and Applied Nutrition, 
Food and Drug Administration, 5100 Paint Branch Pkwy., College Park, MD 
20740. Copies may be examined at the Center for Food Safety and Applied 
Nutrition's Library, 5100 Paint Branch Pkwy., College Park, MD 20740, 
or at the National Archives and Records Administration (NARA). For 
information on the availability of this material at NARA, call 202-741-
6030, or go to: http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.
    (7) Tallow derivative means any chemical obtained through initial 
hydrolysis, saponification, or trans-esterification of tallow; chemical 
conversion of material obtained by hydrolysis, saponification, or 
trans-esterification may be applied to obtain the desired product.
    (b) Requirements. No cosmetic shall be manufactured from, processed 
with, or otherwise contain, prohibited cattle materials.
    (c) Records. Manufacturers and processors of cosmetics that are 
manufactured from, processed with, or otherwise contain, cattle 
material must make existing records relevant to compliance with this 
section available to FDA for inspection and copying.
    (d) Adulteration. Failure of a manufacturer or processor to operate 
in compliance with the requirements of paragraph (b) or (c) of this 
section renders a cosmetic adulterated under section 601(c) of the act.

    Dated: July 8, 2004.
Lester M. Crawford,
Acting Commissioner of Food and Drugs,
[FR Doc. 04-15881 Filed 7-9-04; 11:00 am]
BILLING CODE 4160-01-S