[Federal Register Volume 71, Number 64 (Tuesday, April 4, 2006)]
[Notices]
[Pages 16779-16783]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-3212]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Comment Request

AGENCY: Federal Trade Commission (``FTC'' or ``Commission'').

ACTION: Notice.

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SUMMARY: The FTC is considering conducting a study to analyze the use 
and likely short- and long-run competitive effects of authorized 
generic drugs in the prescription drug marketplace. Before 
investigating these issues, the FTC is soliciting public comments on 
its proposed information requests to firms in the prescription drug 
industry. These comments will be considered before the FTC submits a 
request for Office of Management and Budget (``OMB'') review under the 
Paperwork Reduction Act (``PRA''), 44 U.S.C. 3501-3520.

DATES: Comments must be received on or before June 5, 2006.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Authorized Generic Drug Study: FTC Project 
No. P062105'' to facilitate the organization of comments. A comment 
filed in paper form should include this reference both in the text and 
on the envelope and should be mailed or delivered, with two complete 
copies, to the following address: Federal Trade Commission/Office of 
the Secretary, Room H-135 (Annex J), 600 Pennsylvania Avenue, NW., 
Washington, DC 20580. Because paper mail in the Washington area and at 
the Commission is subject to delay, please consider submitting your 
comments in electronic form, as prescribed below. However, if the 
comment contains any material for which confidential treatment is 
requested, it must be filed in paper form, and the first page of the 
document must be clearly labeled ``Confidential.'' \1\ The FTC is 
requesting that any comment filed in paper form be sent by courier or 
overnight service, if possible. Alternatively, comments may be filed in 
electronic form (in ASCII format, WordPerfect, or Microsoft Word) as 
part of or as an attachment to email messages directed to the following 
e-mail box: [email protected].
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    \1\ Commission Rule 4.2(d), 16 CFR 4.2(d). The comment must be 
accompanied by an explicit request for confidential treatment, 
including the factual and legal basis for the request, and must 
identify the specific portions of the comment to be withheld from 
the public record. The request will be granted or denied by the 
Commission's General Counsel, consistent with applicable law and the 
public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).
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    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments will be 
considered by the Commission and will be available to the public on the 
FTC Web site, to the extent practicable, at http://www.ftc.gov. As a 
matter of discretion, the FTC makes every effort to remove home contact 
information for individuals from the public comments it receives before 
placing those comments on the FTC Web site. More information, including 
routine uses permitted by the Privacy Act, may be found in the FTC's 
privacy policy at http://www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: Requests for additional information 
should be addressed to Michael S. Wroblewski, Assistant General 
Counsel, Policy Studies, 600 Pennsylvania Avenue, NW., Washington, DC 
20580; telephone (202) 326-2155.

SUPPLEMENTARY INFORMATION: In the United States, the Food and Drug 
Administration (``FDA'') must approve the marketing of any 
pharmaceutical drug, whether brand-name or generic. The Hatch-Waxman 
Act establishes the regulatory framework under which the FDA may 
approve a generic drug to be marketed. Typically, a brand-name drug 
obtains FDA approval through a New Drug Application (``NDA''), and a 
generic drug manufacturer obtains FDA approval through an Abbreviated 
New Drug Application (``ANDA'') in which it may be allowed to rely on 
the clinical data first submitted by the brand-name drug manufacturer.
    To encourage generic entry as soon as is warranted, the Hatch-
Waxman Act allows generic drug manufacturers, in certain circumstances, 
to market a generic drug prior to the expiration of claimed patent 
protection for the corresponding brand-name drug. To be permitted to do 
so, a generic drug manufacturer must first submit a ``paragraph IV'' 
ANDA in which it certifies that (a) its generic drug will not infringe 
patents listed in the FDA's ``Orange Book'' (``Orange Book patents'') 
as claiming the relevant brand-name drug product, and/or (b) the 
relevant Orange Book patents are invalid. If the paragraph IV ANDA 
leads to litigation, then 30 months after the litigation was filed (or 
after final decision in the litigation, if earlier), the FDA may 
authorize the marketing of the generic drug under the ANDA application.
    At that point, the first-filed paragraph IV ANDA applicant becomes 
entitled to a 180-day marketing exclusivity period,

[[Page 16780]]

during which the FDA cannot approve any other, later-filed paragraph IV 
ANDA for a generic drug corresponding to the same brand-name drug 
product.\2\ This protects the first FDA-approved paragraph IV ANDA 
applicant from competition with other generic ANDA applicants during 
this time.
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    \2\ The 2003 Medicare Prescription Drug Improvement and 
Modernization Act of 2003 (Pub. L. 108-173) revised the precise 
conditions under which the FDA can approve a later-filed ANDA. In 
general, the exclusivity period lasts until 180 days after (1) the 
first commercial marketing of the first applicant's generic drug, or 
(2) a decision of an appellate court holding the brand-name 
company's patent(s) invalid or not infringed.
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    The 180-day marketing exclusivity period does not preclude 
competition from NDA-approved ``authorized generics,'' however.\3\ An 
authorized generic is chemically identical to a particular brand-name 
drug, which the brand-name manufacturer authorizes to be marketed in a 
generic version under the NDA-approval that the FDA granted for the 
brand-name drug. The brand-name manufacturer either sells the 
authorized generic itself through a subsidiary or licenses a generic 
firm to sell the authorized generic. The trade dress typically differs 
for the brand-name drug and its authorized generic equivalent, but the 
drug product is exactly the same.
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    \3\ Teva Pharm. Indus. v. FDA, 410 F.3d 51 (DC Cir. 2005).
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    In recent years and with increasing frequency, brand-name drug 
manufacturers have begun to market authorized generic drugs at 
precisely the same time that a paragraph IV generic is beginning its 
period of 180-day marketing exclusivity. The likely effects of this 
practice on generic competition have been subject to some debate. In 
the short run, the entry of an authorized generic drug may benefit 
consumers by creating additional competition that lowers generic prices 
further than if only the paragraph IV generic were marketed. Many 
generic manufacturers assert, however, that in the long run, consumers 
will be harmed because an expectation of competition from authorized 
generics will significantly decrease the incentives of generic 
manufacturers to pursue entry prior to patent expiration. For a generic 
manufacturer, the additional competition from an authorized generic may 
result in significantly less profit during the period of 180-day 
exclusivity than if the generic manufacturer had no authorized-generic 
competition during that time.
    Currently, there is no publicly available, comprehensive economic 
study that assesses the likely short- and long-run effects of entry by 
authorized generics on generic competition.\4\ Given the importance of 
generic drugs in lowering health care costs, Senators Grassley, Leahy, 
and Rockefeller have requested that the Commission conduct a study of 
``the short term and long term effects on competition of the practice 
of ``authorized'' generics.'' \5\ In addition, Representative Waxman, 
one of the co-authors of the Hatch-Waxman Act, has requested that the 
FTC study ``the impact of so-called ``authorized generics'' on 
competition in the prescription drug marketplace.'' \6\
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    \4\ A recent paper by Ernst R. Berndt, et al., funded by Johnson 
& Johnson, discusses the issues involved, but relies solely on data 
for three drug products as the bases for its conclusions that 
authorized generics benefit consumers and are unlikely to harm 
competition. An October 2005 paper by David Reiffen, et al., studies 
the magnitude of the effect of authorized generic entry on generic 
price, but does not measure this effect directly and uses data from 
the late 1980s and early 1990s. The proposed study would include a 
more robust and up-to-date analysis of the competitive effects of 
authorized generics based on actual company data.
    \5\ See Letter to Chairman Deborah Platt Majoras, from Senators 
Grassley, Leahy, and Rockefeller (May 9, 2005).
    \6\ See Letter to Chairman Deborah Platt Majoras from 
Representative Henry A. Waxman (Sept. 13, 2005).
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    The Commission proposes to undertake such a study, as described in 
this notice, to examine both the likely short-term competitive effects 
of authorized generic drug entry and, to the extent possible, the 
likely long-term impact of entry by authorized generic drugs on 
competition by generic manufacturers.\7\ Among other things, the 
proposed study will examine actual wholesale prices (including rebates, 
discounts, etc.) for brand-name and generic drugs, both with and 
without competition from authorized generics; business reasons 
(including profitability assessments) that support authorized generic 
entry; factors (including product development and litigation costs) 
relevant to the decisions of generic firms about whether and under what 
circumstances to seek entry prior to patent expiration; and licensing 
agreements with authorized generics. These data will enable the 
proposed study to make new contributions to the economic literature on 
the effects of generic drug entry on prescription drug prices and, in 
particular, the role of the 180-day period of exclusivity in generic 
competition prior to patent expiration.
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    \7\ In its 2002 study of how generic drug competition prior to 
patent expiration has developed, the Commission found that the 
Hatch-Waxman framework had promoted entry by low-cost generic drugs 
prior to patent expiration. Federal Trade Commission, Generic Drug 
Entry Prior to Patent Expiration: An FTC Study (July 2002), 
available at http://www.ftc.gov/os/2002/07/genericdrugstudy.pdf 
(``Generic Drug Study'').
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    To obtain the relevant data, the Commission proposes to send 
special orders pursuant to Section 6(b) of the FTC Act, 15 U.S.C. 
46(b), to brand-drug companies with products that have first faced 
generic competition since January 1, 1999; \8\ generic drug companies 
that have marketed authorized generic drugs since January 1, 1999 
(``authorized generic companies''); and generic drug companies that 
have filed an ANDA containing paragraph III and IV certifications since 
January 1, 1999 (``independent generic companies''). The Commission has 
entered into an agreement with the FDA to obtain information to 
identify the brand-drug companies and independent generic companies 
that meet these criteria. Information received from the brand-name 
companies in response to the special orders will permit the Commission 
to issue subsequent special orders to authorized generic companies. 
Based on a preliminary analysis, approximately 80 brand-name drug 
manufacturers, 10 authorized generic drug companies, and 100 
independent generic companies meet these criteria.
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    \8\ We have chosen 1999 as the start of the study period because 
in 1998, the FDA changed its regulations governing eligibility for 
the 180-day exclusivity period in response to the decision in Mova 
v. Shalala, 140 F.3d 1060 (DC Cir. 1998). Since then, the FDA has 
granted the 180-day exclusivity to substantially more generic 
applicants than it had previously. Generic Drug Study at 57. This 
proposed study, therefore, will be based on this altered regulatory 
landscape.
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    Under the PRA, Federal agencies must obtain approval from OMB for 
each collection of information they conduct or sponsor. ``Collection of 
information'' means agency requests or requirements that members of the 
public submit reports, keep records, or provide information to a third 
party. 44 U.S.C. 3502(3), 5 CFR 1320.3(c). As required by the PRA, 44 
U.S.C. 3506(c)(2)(A), the FTC is providing this opportunity for public 
comment before requesting that OMB grant clearance for this survey.
    The FTC invites comment on the following: (1) Whether the proposed 
collections of information are necessary for the proper performance of 
the functions of the FTC, including whether the information will have 
practical utility; (2) the accuracy of the FTC's estimate of the burden 
of the proposed collections of information; (3) ways to limit the 
number of companies included in the study without undermining the 
validity and reliability of the study results (e.g., reduce the number 
of drug products studied by only including those products in an oral 
solid form, eliminate those generic companies that

[[Page 16781]]

have filed only one ANDA during the study period, reduce the study time 
period, etc.); (4) ways to enhance the quality, utility, and clarity of 
the information to be collected; and (5) ways to minimize the burden of 
collecting the information on those who are to respond, including 
through the use of collection techniques or other form of information 
technology, e.g., permitting electronic submissions of responses. All 
comments should be filed as prescribed in the ADDRESSES section above, 
and must be received on or before June 5, 2006.

A. Description of the Collection of Information and Proposed Use

    The FTC proposes to send information requests to approximately 80 
brand-name drug manufacturers, 10 authorized generic drug companies, 
and 100 independent generic companies. As described above, the brand-
name companies to which the information requests would be sent include 
those companies with products that have first faced generic drug 
competition since January 1, 1999 or that have received notice of the 
filing of an ANDA, as defined by 21 U.S.C. 355(j)(IV), as to one or 
more of their products since January 1, 1999. The FTC also proposes to 
send special orders to generic drug companies that have marketed 
authorized generic drugs since January 1, 1999. In addition, the FTC 
proposes to send special orders to generic drug companies that filed an 
ANDA since January 1, 1999.
    In addition to routine questions about the name, address, 
organization chart(s), and incorporation date of the responding company 
and its subsidiaries, and the name, business address, and official 
capacity of the official supervising the company's response, the FTC 
will ask the three different company types to provide answers to the 
following questions for a list of specific drug products that the FTC 
will provide:

Brand-Name Companies

    1. For each identified drug product, submit any documents, 
including studies, surveys, analyses, and reports (both internal and 
external), that are dated after January 1, 1998 and were prepared or 
received by or for any senior vice president (or equivalent position) 
with product line responsibility for the specified drug product or any 
officer(s) or director(s) of the company (or, in the case of 
unincorporated entities, individuals exercising similar functions) that 
evaluated, considered, analyzed, or discussed how to respond (including 
through pricing changes) to (a) future or current generic competition, 
(b) the expiration of the patent(s) claiming the identified drug 
product or its use, (c) whether to license or otherwise market the 
identified drug product as an authorized generic drug product, and/or 
(d) whether to refrain from marketing an authorized generic, including 
but not limited to, agreements to do so. This request includes 
documents that discuss future generic entry for either specified 
products or responses to generic entry in general. For each such 
document, indicate (if not contained in the document itself) the date 
of preparation and the name and title of each individual who prepared 
the document, and group the documents by identified drug product. If 
the company licensed or otherwise authorized the marketing of the 
identified drug product as an authorized generic, provide the license 
agreement with the authorized generic company and the supplemental 
application the company filed with the FDA pursuant to 21 U.S.C. 
356a(b) that had the effect of allowing the company to license or 
otherwise market the identified drug product as an authorized generic.
    2. For each identified drug product, provide the following 
information:
    a. A detailed description of the product, including its brand name 
or identification number, its common name, and its biological or 
chemical class; its application status at the FDA for each of its 
indication(s) or end use(s), and intended indication(s) or end use(s), 
including the date the New Drug Application was filed and approved, and 
the date the product was first marketed in the United States, as both a 
brand-name drug and, if applicable, an authorized generic;
    b. A detailed description of every SKU of the product as both a 
brand-name drug and, if applicable, an authorized generic, including 
product form, dosage strength, bottle or box size, route of 
administration, and the date first marketed in the United States;
    c. The identification number of each SKU of each product;
    d. A list of all patents listed in the Orange Book for each drug 
product whether owned, licensed, or controlled by the company, 
including patent or patent application number, title, priority date, 
inventor, date filed, date issued, date of patent expiration, status, 
and a copy of all relevant claims.
    3. For each SKU listed in response to Specification 2c above, state 
for every month from a full calendar year preceding generic entry to 
the present, for sales in the United States (e.g., if generic entry 
occurred in July 2002, the company is to provide the following 
information for every month beginning January 1, 2001):
    a. The company's total sales, net of discounts, rebates, 
promotions, returns and chargebacks, to all customers in units, total 
prescriptions, and dollars;
    b. The company's total sales, net of discounts, rebates, 
promotions, returns and chargebacks, to hospitals, clinics and long-
term care facilities, including but not limited to independent cancer 
care centers and pain centers, in units, total prescriptions, and 
dollars; \9\
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    \9\ Prescription drugs distributed through hospitals, clinics 
and long-term care facilities may have different pricing structures 
than those distributed through retail and mail-order pharmacies.
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    c. The company's standard or actual cost of goods sold in dollars, 
reported by material cost, labor cost, manufacturing cost, distribution 
cost, API cost, overhead cost, other cost, and variances;
    d. The company's prices, including: (1) List price; (2) average 
wholesale price; (3) wholesale acquisition cost; (4) price to Medicare; 
(5) price to Medicaid; (6) the maximum allowable cost; and (7) average 
manufacturer price (``AMP'') as defined by, and reported to, the 
Centers for Medicare and Medicaid Services.
    Authorized Generic Company Questions [If a Brand Drug Company uses 
a subsidiary, division, or affiliated company to distribute the 
authorized generic drug, the ``company'' referred to in these questions 
is that subsidiary, division, or affiliated company.]:
    1. For each identified drug product that is licensed to, or 
otherwise marketed by, the company:
    a. Provide any documents, including studies, surveys, analyses, and 
reports (both internal and external), that are dated after January 1, 
1998 and were prepared or received by or for any senior vice president 
(or equivalent position) with product line responsibility for the 
specified drug product or any officer(s) or director(s) of the company 
(or, in the case of unincorporated entities, individuals exercising 
similar functions) that evaluated, considered, analyzed, or discussed 
whether or how to proceed with generic entry, including discussion 
related to whether to file an ANDA containing a paragraph III or IV 
certification (regardless of whether the company filed such ANDA), 
whether or when to launch commercial marketing, and the impact that 
entry by an authorized generic drug would have on generic entry by an 
ANDA drug product. This request includes documents that discuss future 
generic entry for either specified products or responses to generic 
entry in general. For each such

[[Page 16782]]

document, indicate (if not contained in the document itself) the date 
of preparation and the name and title of each individual who prepared 
each such document;
    b. Provide a copy of the license agreement, or other marketing 
authorization, with the brand-name company.
    2. For each identified drug product that is licensed to, or 
otherwise marketed by, the company, provide the following information:
    a. A detailed description of every SKU of the product, including 
product form, dosage strength, bottle or box size, route of 
administration, and the date first sold in the United States;
    b. The identification number of each SKU of each product.
    3. For each SKU of each relevant product listed in response to 
Specification 2b above, state for every month from the date of first 
commercial marketing to the present, for sales in the United States:
    a. The company's total sales, net of discounts, rebates, 
promotions, returns and chargebacks, to all customers in units, total 
prescriptions, and dollars;
    b. The company's total sales, net of discounts, rebates, 
promotions, returns and chargebacks, to hospitals, clinics and long-
term care facilities, including but not limited to independent cancer 
care centers and pain centers, in units, total prescriptions, and 
dollars;
    c. The company's standard or actual cost of goods sold in dollars, 
reported by material cost, labor cost, manufacturing cost, distribution 
cost, API cost, overhead cost, other cost, and variances;
    d. The company's prices, in each relevant area, including: (1) List 
price; (2) average wholesale price; (3) wholesale acquisition cost; (4) 
price to Medicare; (5) price to Medicaid; (6) the maximum allowable 
cost; and (7) average manufacturer price (``AMP'') as defined by, and 
reported to, the Centers for Medicare and Medicaid Services.

Independent Generic Company Questions

    1. For each identified product, and for any other brand drug 
product for which the company has evaluated, considered, analyzed, or 
discussed whether or how to proceed with generic entry, submit the 
following:
    a. Any documents, including studies, surveys, analyses, and reports 
(both internal and external), that are dated after January 1, 1998 and 
were prepared or received by or for any senior vice president (or 
equivalent position) with product line responsibility for the specified 
drug product or any officer(s) or director(s) of the company (or, in 
the case of unincorporated entities, individuals exercising similar 
functions) that evaluated, considered, analyzed, or discussed whether 
or how to proceed with generic entry, including discussion related to 
(a) whether to file an ANDA containing a paragraph III or IV 
certification (regardless of whether the company filed such ANDA), (b) 
whether or when to launch commercial marketing, and/or (c) the impact 
that entry by an authorized generic drug would have on generic entry by 
the company's ANDA drug product. This request includes documents that 
discuss future generic entry for either specified products or responses 
to generic entry in general. For each such document, indicate (if not 
contained in the document itself) the date of preparation and the name 
and title of each individual who prepared each such document. Submit a 
copy of the ANDA application for each identified drug product;
    b. Any documents sufficient to show the identified product's 
development costs, costs to file ANDA, and patent-related litigation 
costs.
    2. For each identified product, state the following:
    a. A detailed description of the product, including its brand name 
or identification number, its common name, and its therapeutic class; 
its application status at the FDA for each of its indication(s) or end 
use(s), and intended indication(s) or end use(s), including the date 
the application was filed and approved, and the date the product was 
first sold in the United States;
    b. A detailed description of every SKU of the product, including 
product form, dosage strength, bottle or box size, route of 
administration, and the date first sold in the relevant area;
    c. The identification number of each SKU of each product.
    3. For each SKU listed in response to Specification 2c, state for 
every month from the date of first commercial marketing to the present, 
for sales in the United States:
    a. The company's total sales, net of discounts, rebates, 
promotions, returns and chargebacks, to all customers in units, total 
prescriptions, and dollars;
    b. The company's total sales, net of discounts, rebates, 
promotions, returns and chargebacks, to hospitals, clinics and long-
term care facilities, including but not limited to independent cancer 
care centers and pain centers, in units, total prescriptions, and 
dollars;
    c. The company's standard or actual cost of goods sold in dollars, 
reported by material cost, labor cost, manufacturing cost, distribution 
cost, API cost, overhead cost, other cost, and variances;
    d. The company's prices, in each relevant area, including: (1) List 
price; (2) average wholesale price; (3) wholesale acquisition cost; (4) 
price to Medicare; (5) price to Medicaid; (6) the maximum allowable 
cost; and (7) average manufacturer price (``AMP'') as defined by, and 
reported to, the Centers for Medicare and Medicaid Services.

For All Three Company Types

    The FTC will request IMS Health (IMS) data if the company obtains 
such information in the regular course of business, as follows:
    If the company obtains IMS Health (IMS) data in the regular course 
of business, provide for each identified drug product, for every month 
from January 1999 (or date of first commercial marketing, where 
applicable) to the present for sales in the United States:
    a. IMS Retail Perspective data, or the equivalent thereof, by 
product form, by strength, and by diagnosis, for total sales in dollars 
and units, by customer channel, including, but not limited to 
independent pharmacies, chain pharmacies, mass merchandisers, 
proprietary stores, and food stores with pharmacies;
    b. IMS Provider Perspective data, or the equivalent thereof, by 
product form, by strength, and by diagnosis, for total sales in dollars 
and units, by customer channel, including, but not limited to, non-
federal hospitals, federal facilities, mail order, and long-term care 
facilities, clinics, and closed wall HMOs;
    c. IMS National Prescription Audit data, or the equivalent thereof, 
by product form, by strength, and by diagnosis, for newly dispensed 
prescriptions, refill dispensed prescriptions, total dispensed 
prescriptions, total units, and total dollar sales;
    d. IMS Retail Method of Payment Report, or the equivalent thereof, 
by product form, by strength, and by diagnosis, for total sales in 
dollars and units, by customer channel, including, but not limited to, 
private managed care, and public managed care;
    e. IMS Integrated Promotional Services Total Promotion Report, by 
product form, for total dollars spent for: (1) Detailing; (2) physician 
and pharmacist marketing; (3) medical and other journal advertising; 
and (4) any other promotional spending, including, but not limited to, 
direct consumer advertising;
    f. Any other IMS data, or the equivalent thereof, used in the 
ordinary course of business;

[[Page 16783]]

    g. All supporting definitions and materials for any IMS data 
provided.
    The FTC will obtain the information sought by interrogatories and 
document requests under Section 6(b) of the FTC Act, 15 U.S.C. 46(b). 
The FTC will use available information technology (e.g., electronic 
submission of financial information) to ease the collection of the 
requested information.
    It should be noted that subsequent to this notice, any destruction, 
removal, mutilation, alteration, or falsification of documentary 
evidence that may be responsive to this information collection within 
the possession or control of a person, partnership or corporation 
subject to the FTC Act may be subject to criminal prosecution. 15 
U.S.C. 50; see also 18 U.S.C. 1505.
    The information presented in the study will not identify company-
specific data. See 15 U.S.C. 57b-2(d)(1)(B). Rather, the Commission 
anticipates using primarily aggregated totals, on a level sufficient to 
protect individual companies' confidential information, to provide a 
factual summary of the effect of authorized generic entry since 1999. 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), bars the Commission from 
publicly disclosing trade secrets or confidential commercial or 
financial information it receives from persons pursuant to, among other 
methods, special orders authorized by Section 6(b) of the FTC Act. Such 
information also would be exempt from disclosure under the Freedom of 
Information Act. 5 U.S.C. 552(b)(4). Moreover, under Section 21(c) of 
the FTC Act, 15 U.S.C. 57b-2(c), a submitter who designates a 
submission as confidential is entitled to 10 days' advance notice of 
any anticipated public disclosure by the Commission, assuming that the 
Commission has determined that the information does not, in fact, 
constitute 6(f) material. Although materials covered under one or more 
of these various sections are protected by stringent confidentiality 
constraints, the FTC Act and the Commission's rules authorize 
disclosure in limited circumstances (e.g., official requests by 
Congress, requests from other agencies for law enforcement purposes, 
administrative or judicial proceedings). Even in those limited 
contexts, however, the Commission's rules may afford the submitter 
advance notice to seek a protective order. See 15 U.S.C. 57b-2(c); 16 
CFR 4.9-4.11.

B. Estimated Burden Hours

    The FTC proposes to use three different sets of questions for the 
three drug company types: Brand-name companies, authorized generic 
companies, and independent generic companies. The drug products that 
the FTC will study will be identified for each company. Although the 
questions vary, the FTC does not anticipate this will have a 
significant effect on the effort required to respond to them.
    The FTC has estimated three average response times depending upon 
the number of drug products for which the company is required to 
provide a response: Companies with one to five drug products, companies 
with six to 10 drug products, and companies with more than 10 drug 
products. The FTC anticipates that the majority of burden hours will be 
primarily to search, retrieve, and copy relevant documents necessary to 
answer question number 1 for each of the company types, and that the 
hours necessary to obtain the financial information will not vary 
depending upon the number of drug products. The total estimated burden 
to answer the questions and to produce documents based on the number of 
drug products identified for each company is based on the following:

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                 Task                     1-5 Drug products       6-10 Drug  products       > 10 Drug products
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Organize document and information      12 hours...............  24 hours...............  48 hours
 retrieval.
Identify requested documents.........  12.....................  36.....................  80
Retrieve and copy requested documents  40.....................  60.....................  120
Identify requested financial           40.....................  50.....................  60
 information.
Obtain financial information.........  12.....................  16.....................  20
Prepare response.....................  24.....................  40.....................  80
 
    Total............................  140 hours..............  226 hours..............  408 hours.
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    Based on preliminary information, the FTC anticipates that it will 
seek information about 1 to 5 drug products from approximately 130 
companies, for 6 to 10 drug products from 20 companies, and for greater 
than 10 drug products from 40 companies. Thus, the cumulative hours 
burden to produce documents and prepare the response sought will be 
approximately 39,040 hours (140 hours x 130 companies + 226 x 20 
companies + 408 hours x 40 companies).

C. Estimated Cost Burden

    It is not possible to calculate with precision the labor costs 
associated with answering the questions and producing the documents 
requested, as responses will entail participation by management and/or 
support staff at various compensation levels among many different 
companies. Individuals among some or all of those labor categories may 
be involved in the information collection process. Nonetheless, the FTC 
has assumed that mid-management personnel and outside legal counsel 
will handle most of the tasks involved in gathering and producing the 
responsive information, and has applied an average hourly wage of $250/
hour for their labor. Thus, the labor costs per company should range 
between $35,000 (140 hours x $250/hour) and $102,000 (408 hours x $250/
hour).
    The FTC estimates that the capital or other non-labor costs 
associated with the information requests will be minimal. Although the 
information requests may require that respondent retain copies of the 
information provided to the Commission, industry members should already 
have in place the means to store information of the volume requested.

    By direction of the Commission, Commissioner Harbour recused.
Donald S. Clark,
Secretary.
[FR Doc. 06-3212 Filed 4-3-06; 8:45 am]
BILLING CODE 6750-01-P