[Federal Register Volume 77, Number 138 (Wednesday, July 18, 2012)]
[Proposed Rules]
[Pages 42195-42197]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-17533]


 ========================================================================
 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 77, No. 138 / Wednesday, July 18, 2012 / 
Proposed Rules  

[[Page 42195]]



DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

9 CFR Part 107

[Docket No. APHIS-2011-0048]
RIN 0579-AD66


Viruses, Serums, Toxins, and Analogous Products; Exemptions From 
Preparation Pursuant to an Unsuspended and Unrevoked License

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: We are proposing to amend the Virus-Serum-Toxin Act 
regulations to require that veterinary biologics prepared under the 
veterinary practitioner exemption must be prepared at the same facility 
the veterinarian utilizes in conducting the day-to-day activities 
associated with his or her practice. This exemption applies to 
veterinary biologics prepared by a veterinary practitioner solely for 
administration to animals in the course of a State-licensed 
professional practice of veterinary medicine under a veterinarian-
client-patient relationship. This proposed amendment is necessary to 
ensure that veterinary biologics are not prepared in unlicensed 
establishments in violation of the Virus-Serum-Toxin Act. The effect of 
the proposed amendment would be to clarify the regulations regarding 
the preparation of product by a veterinary practitioner under a 
veterinarian-client-patient relationship.

DATES: We will consider all comments that we receive on or before 
September 17, 2012.

ADDRESSES: You may submit comments by either of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov/#!documentDetail;D=APHIS-2011-0048-0001.
     Postal Mail/Commercial Delivery: Send your comment to 
Docket No. APHIS-2011-0048, Regulatory Analysis and Development, PPD, 
APHIS, Station 3A-03.8, 4700 River Road Unit 118, Riverdale, MD 20737-
1238.
    Supporting documents and any comments we receive on this docket may 
be viewed at http://www.regulations.gov/#!docketDetail;D=APHIS-2011-
0048 or in our reading room, which is located in room 1141 of the USDA 
South Building, 14th Street and Independence Avenue SW., Washington, 
DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through 
Friday, except holidays. To be sure someone is there to help you, 
please call (202) 799-7039 before coming.

FOR FURTHER INFORMATION CONTACT: Dr. Donna Malloy, Operational Support 
Section, Center for Veterinary Biologics, Policy, Evaluation, and 
Licensing, VS, APHIS, 4700 River Road Unit 148, Riverdale, MD 20737-
1231; phone (301) 851-3426, fax (301) 734-4314.

SUPPLEMENTARY INFORMATION:

Background

    The regulations in Title 9, Code of Federal Regulations (9 CFR), 
parts 101-118 (referred to below as the regulations) contain provisions 
implementing the Virus-Serum-Toxin Act (the Act), as amended (21 U.S.C. 
151-159). These regulations are administered by the Animal and Plant 
Health Inspection Service (APHIS) of the U.S. Department of Agriculture 
(USDA). The Act prohibits the preparation, sale, and shipment of 
veterinary biological products in or from the United States unless such 
products have been prepared under and in compliance with USDA 
regulations at an establishment holding an unsuspended and unrevoked 
license issued by USDA.
    In part 102 of the regulations, Sec. Sec.  102.1 and 102.2 require 
that each establishment and every person preparing biological products 
subject to the Act must hold an unexpired, unsuspended, and unrevoked 
U.S. Veterinary Biologics Establishment License issued by the 
Administrator and a U.S. Veterinary Biological Product License for each 
product prepared in such establishment. Part 107 of the regulations 
contains exemptions from the requirement for preparation pursuant to 
unsuspended and unrevoked establishment and product licenses. One of 
those exemptions, found in Sec.  107.1(a), allows for product to be 
prepared by a veterinary practitioner solely for administration to 
animals in the course of his or her State-licensed professional 
practice of veterinary medicine under a veterinarian-client-patient 
relationship. The regulations in Sec.  107.1(a)(1) set forth the 
criteria that must be satisfied in order to establish the existence of 
a veterinarian-client-patient relationship.
    Recently, it has come to APHIS' attention that some veterinary 
practitioners may be entering into contractual agreements whereby 
product would be prepared by a commercial laboratory/manufacturing 
facility (unlicensed vaccine manufacturing establishment) rather than 
by the practitioner at the facility he or she uses to conduct the day-
to-day activities associated with his or her State licensed practice of 
veterinary medicine. Such arrangements in which an unlicensed 
establishment, acting as an agent for the practitioner, prepares the 
product and sells and ships/transports the product directly to the 
animal owner creates a situation in which product is prepared, sold, 
and shipped in violation of the Act. Specifically, the Act states that 
no person, firm, or corporation shall prepare, sell, barter, exchange, 
or ship any virus, serum, toxin, or analogous product manufactured 
within the United States and intended for the treatment of animals, 
unless and until the said virus, serum, toxin, or analogous product 
shall have been prepared, under and in compliance with regulations at 
an establishment holding an unsuspended and unrevoked license issued by 
the Secretary of Agriculture.
    While part 107 of the regulations specifies the licensing exemption 
for product prepared by veterinary practitioners and sets forth the 
requirements for showing that a veterinarian-client-patient 
relationship exists, it appears that, given the instances described in 
the previous paragraph, some clarification is necessary with respect to 
the issue of the relationship between the veterinary practitioner and 
the facility where the product is prepared. The purpose of this 
provision is to allow a veterinarian to prepare veterinary biologics at 
the location where she or he operates a veterinary practice, which 
would not be

[[Page 42196]]

licensed under the Act, and to transport it away from that facility 
when necessary, for administration to an animal or animals under a 
veterinarian-client-patient relationship without violating the Act.
    However, no provision in the Act or the regulations would allow a 
veterinary practitioner to take advantage of the licensing exemption 
while at the same time consigning the actual preparation of the product 
to a commercial laboratory/manufacturing establishment which would then 
exchange or deliver the product to a third party. An arrangement such 
as this is contrary to the statutory requirement that prohibits a 
person, firm, or corporation from preparing, selling, bartering, 
exchanging, or shipping a veterinary biologic intended for use in the 
treatment of animals unless and until such product shall have been 
prepared in compliance with the regulations in a USDA licensed 
establishment (see 21 U.S.C. 151).
    In order to ensure that product subject to the exemption for 
products prepared by veterinarians solely for administration to animals 
in the course of a State licensed professional practice of veterinary 
medicine under a veterinarian-client-patient relationship is prepared 
in accordance with the requirements of the Virus-Serum-Toxin Act, APHIS 
is proposing to amend its regulations by adding clarifying language to 
Sec.  107.1 emphasizing the requirement that the exemption from 
preparation pursuant to unsuspended and unrevoked product and 
establishment licenses applies only to product prepared by the 
veterinary practitioner (or by a supervised veterinary assistant) at 
the facility such veterinarian uses in the day-to-day operation of his/
her State-licensed professional practice of veterinary medicine.
    The proposed amendment would clarify that the preparation of 
product prepared by a veterinarian solely for administration to animals 
in the course of a State-licensed professional practice of veterinary 
medicine under a veterinarian-client-patient relationship shall only be 
done at a facility routinely used in the day-to-day operation of a 
professional practice of veterinary medicine.
    We also propose to make minor changes to Sec.  107.1 to replace the 
term ``establishments'' with ``facilities.'' As discussed above, Sec.  
107.1 exempts product prepared by a veterinary practitioner from 
preparation pursuant to an unsuspended and unrevoked product and 
establishment license. However, Sec.  107.1 refers to the sites of such 
production as ``establishments,'' which is confusing because that term 
is used elsewhere in the regulations to refer only to production sites 
that are not exempt from the license requirement. For example, the 
definitions in Sec.  101.2 define establishment as ``One or more 
premises designated on the establishment license.'' Therefore, in Sec.  
107.1 where we refer to the exemption for the site of day-to-day 
operation of a veterinarian's State-licensed professional practice, we 
would use the term ``facilities'' rather than ``establishments.''

Executive Order 12866 and Regulatory Flexibility Act

    This proposed rule has been determined to be not significant for 
the purposes of Executive Order 12866 and, therefore, has not been 
reviewed by the Office of Management and Budget.
    This proposed rule would amend the regulations in Sec.  107.1 to 
clarify that the preparation of biological products pursuant to the 
exemption in paragraph (a)(1) of that section must take place at the 
same facility that the veterinarian preparing the product utilizes in 
conducting the day-to-day activities associated with his/her State-
licensed professional practice of veterinary medicine.
    As noted previously in this proposed rule, no provision in the Act 
or the regulations allows a veterinary practitioner to take advantage 
of the licensing exemption while at the same time consigning the actual 
preparation of the product to a commercial laboratory or other 
manufacturing establishment which would then exchange or deliver the 
product to a third party. An arrangement such as this is contrary to 
the statutory requirement that prohibits a person, firm, or corporation 
from preparing, selling, bartering, exchanging, or shipping a 
veterinary biologic intended for use in the treatment of animals unless 
and until such product shall have been prepared in compliance with the 
regulations in a USDA licensed establishment.
    Therefore, this proposed amendment to the regulations is simply a 
clarification of an existing and longstanding prohibition. The proposed 
amendment would not change the nature of the exemption, the number of 
veterinary practitioners who are eligible to take advantage of the 
exemption, or the criteria that must be satisfied in order to establish 
the existence of a veterinarian-client-patient relationship, nor would 
it add any reporting or recordkeeping burden. It is possible that there 
may be one or several veterinary practitioners that currently contract 
with an unlicensed commercial laboratory or manufacturing facility to 
produce veterinary biologics in violation of the Act. These entities 
could be affected if they become aware of the violation through 
publication of this proposed rule and discontinue the prohibited 
activity, but that effect could also occur at any time under the 
current regulations if APHIS receives specific evidence of such a 
violation and orders its cessation.
    Under these circumstances, the Administrator of the Animal and 
Plant Health Inspection Service has determined that this action would 
not have a significant economic impact on a substantial number of small 
entities.

Executive Order 12372

    This program/activity is listed in the category of Federal Domestic 
Assistance under No. 10.025 and is subject to Executive Order 12372, 
which requires intergovernmental consultation with State and local 
officials. (See 7 CFR part 3015, subpart V.)

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. It is not intended to have retroactive effect. 
This rule would not preempt any State or local laws, regulations, or 
policies where they are necessary to address local disease conditions 
or eradication programs. However, where safety, efficacy, purity, and 
potency of biological products are concerned, it is the Agency's intent 
to occupy the field. Under the Act, Congress clearly intended that 
there be national uniformity in the regulation of these products, and 
APHIS will continue to take enforcement action as necessary against 
practitioners and production facilities with regard to veterinary 
biologics produced or distributed in contravention of the Act. There 
are no administrative proceedings which must be exhausted prior to a 
judicial challenge to the regulations under this rule.

Paperwork Reduction Act

    This proposed rule contains no new information collection or 
recordkeeping requirements under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501 et seq.).

List of Subjects in 9 CFR Part 107

    Animal biologics, Reporting and recordkeeping requirements.

    Accordingly, we propose to amend 9 CFR part 107 as follows:

[[Page 42197]]

PART 107--EXEMPTIONS FROM PREPARATION PURSUANT TO AN UNSUSPENDED 
AND UNREVOKED LICENSE

    1. The authority citation for part 107 continues to read as 
follows:

    Authority:  21 U.S.C. 151-159; 7 CFR 2.22, 2.80, and 371.4.

    2. Section 107.1 is amended as follows:
    a. In the introductory text and in paragraph (a)(1), by removing 
the word ``establishments'' and adding the word ``facilities'' in its 
place.
    b. By redesignating paragraph (a)(2) as paragraph (a)(3) and adding 
a new paragraph (a)(2) to read as follows:


Sec.  107.1  Veterinary practitioners and animal owners.

* * * * *
    (a) * * *
    (2) All steps in the preparation of product being prepared under 
the exemption in paragraph (a)(1) of this section must be performed at 
the facilities that the veterinarian utilizes for the day-to-day 
activities associated with the treatment of animals in the course of 
his/her State-licensed professional practice of veterinary medicine. A 
veterinary assistant employed by the veterinary practitioner and 
working at the veterinary practice's facility under the veterinarian's 
direct supervision may perform the steps in the preparation of product. 
Such preparation may not be consigned to any other party or sub-
contracted to a commercial laboratory/manufacturing facility.
* * * * *

    Done in Washington, DC, this 12th day of July 2012.
Kevin Shea,
Acting Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 2012-17533 Filed 7-17-12; 8:45 am]
BILLING CODE 3410-34-P