[Federal Register Volume 88, Number 22 (Thursday, February 2, 2023)]
[Proposed Rules]
[Pages 7033-7044]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-01804]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration

21 CFR Part 1311

[Docket No. DEA-732]
RIN 1117-AB79


Controlled Substances Ordering System (CSOS) Modernization

AGENCY: Drug Enforcement Administration, Department of Justice.

ACTION: Notice of proposed rulemaking.

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SUMMARY: This rule proposes to amend the Drug Enforcement 
Administration's (DEA) regulations to conform to the Controlled 
Substances Ordering System (CSOS) modernization effort by requiring all 
CSOS enrollment applications and supporting materials to be submitted 
through the Diversion Control Division secure online portal. These 
amendments would improve the enrollment process by aligning it with 
DEA's current requirements for other online form submissions. The 
online submission of enrollment applications and supporting material 
through the secure network application portal would increase the 
efficiency of the enrollment, modification, and revocation processes, 
and ensure DEA's receipt of accurate documentation in a more timely and 
organized manner.

DATES: Electronic comments must be submitted, and written comments must 
be postmarked, on or before April 3, 2023. Commenters should be aware 
that the electronic Federal Docket Management System will not accept 
any comments after 11:59 p.m. Eastern Time on the last day of the 
comment period.
    All comments concerning collections of information under the 
Paperwork Reduction Act must be submitted to the Office of Management 
and Budget on or before April 3, 2023.

ADDRESSES: To ensure proper handling of comments, please reference 
``Docket No. DEA-732'' on all correspondence, including any 
attachments.
     Electronic comments: The Drug Enforcement Administration 
(DEA) encourages that all comments be submitted electronically through 
the Federal eRulemaking Portal which provides the ability to type short 
comments directly into the comment field on the web page or attach a 
file for lengthier comments. Please go to http://www.regulations.gov 
and follow the online instructions at that site for submitting 
comments. Upon completion of your submission, you will receive a 
Comment Tracking Number for your comment. Please be aware that 
submitted comments are not instantaneously available for public view on 
Regulations.gov. If you have received a Comment Tracking Number, your 
comment has been successfully submitted and there is no need to 
resubmit the same comment.
     Paper comments: Paper comments that duplicate electronic 
submissions are not necessary. Should you wish to mail a paper comment, 
in lieu of an electronic comment, it should be sent via regular or 
express mail to: Drug Enforcement Administration, Attn: DEA Federal 
Register Representative/DPW, 8701 Morrissette Drive, Springfield, 
Virginia 22152.

FOR FURTHER INFORMATION CONTACT: Scott A. Brinks, Regulatory Drafting 
and Policy Support Section, Diversion Control Division, Drug 
Enforcement Administration; Telephone: (571) 776-2265.

SUPPLEMENTARY INFORMATION:

Posting of Public Comments

    Please note that all comments received are considered part of the 
public record. They will, unless reasonable cause is given, be made 
available by the Drug Enforcement Administration (DEA) for public 
inspection online at http://www.regulations.gov. Such information 
includes personal identifying information (such as your name, address, 
etc.) voluntarily submitted by the commenter. The Freedom of 
Information Act applies to all comments received. If you want to submit 
personal identifying information (such as your name, address, etc.) as 
part of your comment, but do not want it to be made publicly available, 
you must include the phrase ``PERSONAL IDENTIFYING INFORMATION'' in the 
first paragraph of your comment. You must also place all of the 
personal identifying information you do not want made publicly 
available in the first paragraph of your comment and identify what 
information you want redacted.
    If you want to submit confidential business information as part of 
your comment, but do not want it to be made publicly available, you 
must include the phrase ``CONFIDENTIAL BUSINESS INFORMATION'' in the 
first paragraph of your comment. You must also prominently identify the 
confidential business information to be redacted within the comment.
    Comments containing personal identifying information or 
confidential business information identified as directed above will be 
made publicly available in redacted form. If a comment has so much 
confidential business information that it cannot be effectively 
redacted, all or part of that comment may not be made publicly 
available. Comments posted to http://www.regulations.gov may include 
any personal identifying information (such as name, address, and phone 
number) included in the text of your electronic submission that is not 
identified as confidential as directed above.
    An electronic copy of this proposed rule is available at http://www.regulations.gov for easy reference.

Legal Authority

    The Controlled Substances Act (CSA) grants the Attorney General 
authority to promulgate rules and regulations relating to: the 
registration and control of the manufacture, distribution, and 
dispensing of controlled substances and listed chemicals; reporting 
changes to professional or business addresses; and the efficient 
execution of his statutory functions. 21 U.S.C. 821, 822(a), 827(h), 
871(b), 957(a). The Attorney General is further authorized by the CSA 
to promulgate rules and regulations relating to the registration and 
control of importers and exporters of controlled substances and listed 
chemicals.\1\ The Attorney General has delegated this authority to the 
Administrator of DEA.\2\
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    \1\ 21 U.S.C. 958(f).
    \2\ 28 CFR 0.100(b).
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    The CSA defines ``distribute'' as ``to deliver (other than by 
administering or dispensing) a controlled substance or a listed 
chemical'' and ``distributor'' as ``a person who so delivers a 
controlled substance or a listed chemical.'' \3\ The CSA further 
provides that it ``shall be unlawful for any person to distribute a 
controlled substance in schedule I or II to another except in pursuance 
of a written order of the person to whom such substance is distributed, 
made on a form to be issued by the Attorney General in blank in 
accordance with subsection (d) of this section and regulations 
prescribed by him pursuant

[[Page 7034]]

to this section.'' \4\ ``Every person who gives an order required under 
subsection (a) of this section shall, at or before the time of giving 
such order, make or cause to be made a duplicate thereof on a form to 
be issued by the Attorney General in blank in accordance with 
subsection (d) of this section and regulations prescribed by him 
pursuant to this section, and shall, if such order is accepted, 
preserve such duplicate for a period of two years and make it available 
for inspection and copying . . . . '' \5\ ``The Attorney General shall 
issue forms . . . only to persons validly registered under section 823 
of this title (or exempted from registration under section 822(d) of 
this title). Whenever any such form is issued to a person, the Attorney 
General shall, before delivery thereof, insert therein the name of such 
person, and it shall be unlawful for any other person (A) to use such 
form for the purpose of obtaining controlled substances or (B) to 
furnish such form to any person with intent thereby to procure the 
distribution of such substances.'' \6\
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    \3\ 21 U.S.C. 802(11).
    \4\ 21 U.S.C. 828(a).
    \5\ 21 U.S.C. 828(c)(2).
    \6\ 21 U.S.C. 828(d)(1).
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Implementation of the CSA Written Order Form Requirement

Paper DEA Form 222

    In 1971 DEA implemented the CSA's written order form requirement by 
publishing a final rule requiring triplicate paper DEA Form 222s.\7\ In 
2019, DEA amended its regulations to create a new single-sheet format 
for the paper DEA Form 222s.\8\ The rule contained transition 
provisions allowing registrants to continue to use their existing 
stocks of the triplicate paper DEA Form 222s until their supply was 
exhausted, or until October 30, 2021, whichever came sooner.\9\
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    \7\ 36 FR 7776, April 24, 1971.
    \8\ DEA Notice of Proposed Rulemaking titled ``New Single-Sheet 
Format for U.S. Official Order form for Schedule I and II Controlled 
Substances (DEA Form 222),'' published in the Federal Register on 
February 21, 2019, and DEA Final Rule titled ``New Single-Sheet 
Format for U.S. Official Order Form for schedule I and II Controlled 
Substances (DEA Form 222),'' published in the Federal Register on 
September 30, 2019, at 84 FR 51368.
    \9\ 21 CFR 1305.20.
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Electronic DEA Form 222

    In 2005, DEA published a final rule amending its regulations to 
provide an electronic equivalent to the DEA Form 222 (also known as 
CSOS).\10\ The amendments allowed registrants to order schedule I and 
II controlled substances electronically and maintain records of these 
orders electronically. The intent of these amendments was to reduce 
paperwork and transaction times for DEA registrants who sell or buy 
controlled substances.
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    \10\ DEA Notice of Proposed Rulemaking titled ``Electronic 
Orders for Controlled Substances,'' published in the Federal 
Register on June 27, 2003, at 68 FR 38557 and DEA Final Rule titled 
``Electronic Orders for Controlled Substances,'' published in the 
Federal Register on April 1, 2005, at 70 FR 16901.
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Summary of Current CSOS Regulations

    The current CSOS regulations are found in 21 CFR parts 1305 and 
1311. DEA Registrants use CSOS as a secure system to track schedule I 
and II controlled substance orders. The system allows for secure 
electronic controlled substances orders without the need for a paper 
order form (DEA Form 222). Using Public Key Infrastructure (PKI), CSOS 
requires that each individual supplier and purchaser enroll with DEA to 
acquire a CSOS digital certificate. System enhancements will allow 
electronic documentation submission, self-service support options, and 
electronic processing of single and bulk applications, renewals, and 
revocations. Users will be able to electronically search for, revoke, 
report, retrieve, and renew secure digital certificates.

Purpose of Rule

    Current regulations require registrants who wish to participate in 
the CSOS system to enroll using a labor intensive manual process which 
relies on paper applications. The paper application must be notarized 
and the package mailed to DEA, creating delays in the enrollment 
process and putting applications at risk of being lost.\11\ The purpose 
of this rule is to simplify the application process by requiring all 
CSOS enrollment applications to be submitted online. All applicants for 
enrollment will follow the CSOS link on the deadiversion.gov website to 
the CSOS log-in page. From the CSOS log-in page the applicant will be 
redirected to Login.gov for Identification Verification. Upon arrival 
at the site, the applicant will be asked to create a Login.gov account 
by entering a valid email address, selecting a default language, and 
agreeing to Login.gov's Rules of Behavior. A confirmation email will 
then be sent to the applicant's selected email. Once the email has been 
confirmed, the applicant must create a Login.gov password by providing 
a telephone number to which a verification code can be sent. Once the 
code is sent and the applicant enters the given code on the Login.gov 
website, the applicant must agree to the site's security statement. 
Login.gov next requires applicants to upload photographs of one or more 
forms of identification as specified by Login.gov and to enter a Social 
Security Number, after which the applicant is asked to verify the given 
information. The applicant is next asked to re-enter their Login.gov 
password to receive a Personal Key by separate message. The applicant 
is then asked to enter that Personal Key and review their information. 
Upon review of the information, the applicant is then directed back to 
the CSOS website for further processing. Upon return to the CSOS 
website, the applicant is asked to agree to the CSOS User Agreement and 
can apply for one of three system user roles (Registrant, Coordinator, 
or Power of Attorney in order of superiority) with enrollment requests 
approved or rejected by the superior role. After the Registrant role is 
established, all subordinate applications for enrollment for the 
Coordinator role must be approved by the Registrant. Upon establishment 
of a Coordinator, all subordinate applications for enrollment for the 
Power of Attorney role must be approved in the system by the 
responsible Coordinator. This proposed rule would amend DEA regulations 
to require electronic enrollment through a secure web-based system. 
Submission through the secure online system will be a streamlined 
process which will benefit both DEA and CSOS participants.
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    \11\ 21 CFR part 1311 et seq.
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Discussion of Regulatory Changes

Need for Regulatory Changes

    Regulatory changes are needed to conform existing DEA regulations 
regarding the submission of the paper CSOS system enrollment forms to 
DEA's current requirements that other DEA forms be submitted 
online.\12\ The paper enrollment process is prone to errors, creates 
wasteful and unnecessary paper records, requires manual processing,

[[Page 7035]]

and is expensive to process and store. This rule proposes to amend 
existing DEA regulations in one part--Title 21 Chapter II Part 1311. 
DEA is proposing to amend 21 CFR 1311 to require all CSOS enrollment 
applications and supporting materials to be submitted to DEA through 
the CSOS secure network portal. This amendment would improve the 
submission process by aligning it with DEA's current policy of reducing 
and/or eliminating the reliance on wasteful paper applications and 
expediting enrollment by utilizing modern technology. The online 
submission of applications and supporting materials through the secure 
database will ensure DEA's receipt of documentation in a more timely 
and organized manner.
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    \12\ See Reporting of Theft or Significant Loss of Controlled 
Substances, 85 FR 146 (July 29, 2020) (published NPRM proposing to 
require all DEA Form 106's to be submitted electronically); 
Suspicious Orders of Controlled Substances, 85 FR 212 (Nov. 02, 
2020) (published NPRM proposing centralized electronic reporting for 
SORS based on Congressional mandate); Agency Rule List--Spring 2021 
(2021), https://www.reginfo.gov/public/do/eAgendaMain?operation=OPERATION_GET_AGENCY_RULE_LIST&currentPub=true&agencyCode=&showStage=active&agencyCd=1100&csrf_token=F19C7C599C70B80C228EC16B60AEB150F6339AF3C80E56FE003EEB7D3A758895BC8E16A215E8A0466326EBFBA8639F799E09 (Spring 2021 Unified Agenda of Regulatory and 
Deregulatory Actions, Active Regulatory Actions Listed By Agency, 
Agency Rule list noting proposed rule stage for Electronic 
Submission of DEA Form 41 (Registrant Record of Controlled 
Substances Destroyed) -1117-AB59).
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Section by Section Analysis

    DEA is proposing to amend 21 CFR 1311.20, 1311.25, 1311.40, and 
1311.60 by eliminating the ability of registrants to submit paper CSOS 
enrollment application forms. Registrants would thus be required to 
submit all their application materials through the secure online 
portal. Moreover, DEA is proposing to amend these regulations by 
eliminating certain recordkeeping requirements, as those records would 
now be accessible as a digital version in the system. DEA believes 
these amendments would expedite the enrollment process for registrants 
and facilitate the Agency-wide goal of reducing DEA's reliance on paper 
forms.
    DEA is proposing to amend Sec.  1311.20, which describes the role 
and responsibilities of the CSOS Coordinator. Current regulations 
require the CSOS Coordinator to complete the paper application process 
by submitting the notarized enrollment package to DEA Certification 
Authority for processing. This proposed amendment would streamline the 
process by eliminating the paper process and requiring Coordinator 
applicants to enroll using the secure online portal.
    Additionally, DEA is proposing to amend Sec.  1311.25, which 
establishes the requirements for a registrant, or authorized 
representative with a Power of Attorney, to complete the manual 
application process by submitting the notarized enrollment package to 
the DEA Certification Authority for processing. This proposed amendment 
would streamline the process by eliminating the manual paper process 
and require all Registrants, or authorized representative with a Power 
of Attorney to enroll using the secure online portal.
    DEA is also proposing to amend Sec.  1311.40, which establishes the 
criteria for renewal of a CSOS digital certificate by the manual paper 
process. This proposed amendment would streamline the renewal process 
by eliminating the manual paper process and require that all renewal 
applications be submitted using the secure online portal.
    Last, DEA is proposing to amend Sec.  1311.60, which establishes 
recordkeeping requirements on the part of the CSOS Certificate holder 
by requiring that a copy of the subscriber agreement be maintained for 
the life of the certificate. This proposed amendment would remove the 
requirement of the CSOS Certificate holder to maintain a copy of the 
subscriber agreement by enabling registrants to sign and access a 
digital version of the agreement in the online portal.

Regulatory Analyses

Executive Orders 12866 (Regulatory Planning and Review) and 13563 
(Improving Regulation and Regulatory Review)

    This proposed rule was developed in accordance with the principles 
of Executive Orders (E.O.) 12866 and 13563. E.O. 12866 directs agencies 
to assess all costs and benefits of available regulatory alternatives 
and, if regulation is necessary, to select regulatory approaches that 
maximize net benefits (including potential economic, environmental, 
public health, and safety effects; distributive impacts; and equity). 
E.O. 13563 is supplemental to and reaffirms the principles, structures, 
and definitions governing regulatory review established in E.O. 12866.
    E.O. 12866 classifies a ``significant regulatory action,'' 
requiring review by the Office of Management and Budget (OMB), as any 
regulatory action that is likely to result in a rule that may: (1) have 
an annual effect on the economy of $100 million or more or adversely 
affect in a material way the economy, a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local, or tribal governments or communities; (2) 
create a serious inconsistency or otherwise interfere with an action 
taken or planned by another agency; (3) materially alter the budgetary 
impact of entitlements, grants, user fees, or loan programs or the 
rights and obligations of recipients thereof; or (4) raise novel legal 
or policy issues arising out of legal mandates, the President's 
priorities, or the principles set forth in the E.O. OMB has determined 
that this proposed rule is not a ``significant regulatory action'' 
under E.O. 12866, section 3(f).

Analysis of Benefits and Costs

    Current regulations require registrants who wish to participate in 
the CSOS system to enroll using a labor-intensive manual process which 
relies on paper applications. This proposed rule would amend DEA 
regulations to require electronic enrollment through a secure web-based 
system.
    The current regulations related to CSOS enrollment are summarized 
below.
    (1) 21 CFR 1311.20(b)-(c) requires coordinators to enroll in 
writing.
    (2) 21 CFR 1311.25(a)-(b) requires a registrant, or authorized 
representative with a Power of Attorney, to enroll in writing.
    (3) 21 CFR 1311.40(c)-(d) requires submitting a new application in 
writing for every third renewal and for expired certificates.
    (4) 21 CFR 1311.60(c) requires maintaining a copy of the 
subscription agreement for the life of the certificate.
    The proposed rule would change this to:
    (1) 21 CFR 1311.20(b)-(c) would require coordinators to enroll 
online.
    (2) 21 CFR 1311.25(a) (with (b) removed) would require all 
registrants, or authorized representative with a Power of Attorney, to 
enroll online.
    (3) 21 CFR 1311.40(c)-(d) would require, for every third renewal 
and expiration, a new application online.
    (4) 21 CFR 1311.60(c) would be removed, allowing electronic 
subscription agreements to be held online and no longer requiring a 
paper copy be maintained.
    Table 1 summarizes the changes from current regulations to the 
proposed rule.

      Table 1--Summary of Current Regulations and the Proposed Rule
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         21 CFR Location                Current            Proposed
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1311.20(b)-(c)..................  requires            would require
                                   coordinators to     coordinators to
                                   enroll in writing.  enroll online.
1311.25(a)-(b)..................  requires a          would require all
                                   registrant, or      registrants, or
                                   authorized          authorized
                                   representative      representative
                                   with a Power of     with a Power of
                                   Attorney, to        Attorney, to
                                   enroll in writing.  enroll online.

[[Page 7036]]

 
1311.40(c)-(d)..................  requires            would require, for
                                   submitting a new    every third
                                   application in      renewal and
                                   writing, for        expiration, a new
                                   every third         application
                                   renewal and for     online.
                                   expired
                                   certificates.
1311.60(c)......................  requires            (removal) would
                                   maintaining a       allow
                                   copy of the         subscription
                                   subscription        agreements to be
                                   agreement.          held online and
                                                       no longer require
                                                       a copy be
                                                       maintained.
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    DEA has examined the benefits and costs of this proposed rule and 
believes it is of net economic benefit. DEA believes the cost savings 
to registrants, as well as the DEA, heavily outweigh any cost to the 
DEA associated with implementing and maintaining the necessary computer 
systems to allow for online enrollment and renewal to CSOS.

Affected Parties and Number of CSOS Applications

    This proposed rule would affect registrants who wish to participate 
in the CSOS system and DEA. A registrant, designated person, or an 
authorized representative, who wishes to enroll in the CSOS system can 
apply for one of three system user roles: Registrant, Coordinator, or 
Power of Attorney. New and renewal enrollment applications are 
submitted online. DEA processes the applications in addition to 
operating and maintaining the systems used in the enrollment and 
certificate management process. The economic impact of this proposed 
rule is a function of changes in requirement for each CSOS enrollment 
application and the estimated number of applications.
    Each year DEA receives a mix of new and renewal applications for 
enrollment. In 2021, DEA received 31,172 new applications. These 
applications include 11,411; 6,974; and 12,787 new applications for 
Registrant, Coordinator, and Power of Attorney roles, respectively. For 
every third renewal, the CSOS certificate holder must submit a new 
application.\13\ Therefore, for the purposes of this analysis, a third 
renewal is considered as a new application. Based on this renewal 
requirement, DEA estimates that new applications are approximately one-
third of total applications and the number of renewals is approximately 
twice the number of new applications. Therefore, DEA estimates there 
were 62,344 renewal applications for a total of 93,516 (31,172 + 
62,344) total applications in 2021.
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    \13\ 21 CFR 1311.40(c).
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    As pharmacies are the largest registration business activity that 
participate in CSOS, representing approximately 73% of CSOS registered 
locations,\14\ DEA believes the growth in the number of pharmacies 
registered with the DEA represents a good proxy for the growth of CSOS-
participating registrants, and the number of CSOS applications for 
enrollment.
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    \14\ Source: DEA.
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    The number of DEA registered pharmacies has declined from 72,353 in 
2015 to 70,628 in 2019 and has roughly stayed constant, with no growth, 
from 2019 to 2021, with 70,789 and 70,670 pharmacy registration if 2020 
and 2021, respectively. So, DEA believes that zero net growth in CSOS 
applications is a reasonable estimate. Therefore, DEA estimates the 
numbers of applications stay constant at 31,172 new and 62,344 renewal, 
for a total of 93,516 applications over the 10-year analysis period.

Registrant Impact

New Applications
    Below is a description of the estimated impact of the proposed rule 
on new enrollment applications for Registrant, Coordinator, and Power 
of Attorney roles.
    1. Time To Complete New Application: DEA estimates there will be 
labor cost savings from reduced time to complete a new application. DEA 
estimates that the current time to complete a new application is three 
hours, which includes an estimated 1.5 hours to prepare and provided 
the necessary information and 1.5 hours calling the DEA for assistance 
or status of application. Under the proposed rule, while an applicant 
is expected to require the same 1.5 hours to prepare and provide the 
necessary information, the online system will allow self-viewing of 
status, reducing the need or duration of calls to DEA. DEA estimates 
the required time to complete a new application would be 1.75 hours, 
including an estimated 0.25 hours for logging to CSOS system or calls 
to DEA for assistance. Using a loaded hourly rate of $87.65 for 
Pharmacists,\15 16 17\ the labor cost would decrease from $262.95 
($87.65 x 3) to $153.39 ($87.65 x 1.75), resulting in an estimated cost 
savings of $109.56 ($262.95-$153.39) per application.
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    \15\ U.S. Bureau of Labor Statistics (BLS), Occupational 
Employment and Wages, May 2021, 29-1051 Pharmacists. https://www.bls.gov/oes/current/oes291051.htm. (Accessed 4/25/2022.)
    \16\ BLS, ``Employer Costs for Employee Compensation--December 
2021'' (ECEC).
    \17\ As pharmacies represent a large majority of CSOS 
participants and pharmacists are expected to be the most prevalent 
CSOS users, DEA believes pharmacists wages therefore represent a 
good estimate of the wage for all applicants. BLS reports that the 
median wage of pharmacists is $61.81. BLS also reports that average 
benefits for private industry is 29.5 percent of total compensation. 
The 29.5 percent of total compensation equates to 41.8 percent (29.5 
percent/70.5 percent) load on wages and salaries. The load of 41.8 
percent is added to each of the hourly rates to estimate the loaded 
hourly rates. $61.81 x 1.418 = $87.65.
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    2. Postage Cost: Under current regulations paper application forms 
and supporting information need to be shipped to DEA. The proposed rule 
would eliminate the need to ship paper applications. Not having to ship 
the enrollment package is estimated to reduce postage costs by $11.13 
per application.\18\
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    \18\ FedEx Ground rates for a one-pound package using zone five, 
effective January 4, 2021 and downloaded on 4/6/2022.
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    3. Notary Cost: Under current regulations, a new application for a 
Registrant or a Coordinator role requires a notary. The proposed rule 
would eliminate the notary requirement. Not having to get a notary (due 
to online verification methods that are free) is expected to eliminate 
an estimated notary cost of $5.00 per enrollment package. 
19 20 The notary requirement only applies to Registrant and 
Coordinator roles, and as discussed earlier, of the estimated 31,172 
total new applications, 11,411 and 6,974 are for Registrant and 
Coordinator, respectively, making up 59 percent ((11,411 + 6,974)/
31,174) of total registrations. Therefore, 59 percent of $5.00, $2.95 
is the average notary cost savings for all new applications.
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    \19\ National Notary Association, ``2022 Notary Fees by State''. 
https://www.nationalnotary.org/knowledge-center/about-notaries/notary-fees-by-state (accessed 4/6/2022).
    \20\ Notary fees can range from $1 to $25. DEA has decided to 
use $5 as its estimate of notary fees. DEA believes many applicants 
can get documents notarized at low costs, i.e., at banks, employees 
with public notary, etc.
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    4. Agreement Storage Costs: Under current regulations, a CSOS 
certificate holder is required to maintain a copy of

[[Page 7037]]

the subscriber agreement. The proposed rule would eliminate this 
requirement. DEA does not believe there is a material impact from not 
having to store written subscription agreements and having them be 
stored online in CSOS.
    Table 2 summarizes the impact of the proposed rule for new 
applications.

                                   Table 2--Registrant Impact: New Application
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                                                                                                   Cost savings
                                                                   Current  ($)      New  ($)           ($)
----------------------------------------------------------------------------------------------------------------
Labor cost per New app..........................................          262.95          153.39          109.56
Postage cost per New app........................................           11.13  ..............           11.13
Cost of notary per New app......................................            2.95  ..............            2.95
                                                                 -----------------------------------------------
    Total new application.......................................  ..............  ..............          123.64
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Renewal Applications
    Below is a description of the estimated impact of the proposed rule 
on renewal enrollment applications for Registrant, Coordinator, and 
Power of Attorney roles.
    1. Time Spent Requested Renewal: DEA estimates there will be labor 
cost savings from reduced time to complete a renewal application. DEA 
estimates that the time spent requesting a renewal will fall from 1.5 
hours using the phone method to 0.25 hours using the online method. 
Using a loaded hourly rate of $87.65 for Pharmacists,\21\ the labor 
cost would decrease from $131.48 ($87.65 x 1.5) to $21.91 ($87.65 x 
0.25), resulting in an estimated cost savings of $109.56 ($131.48-
$21.91) per application.
    Table 3 summarizes the impact of the proposed rule for renewal 
applications.

                                Table 3--Registrants Impact--Renewal Applications
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                                                                                                   Cost savings
                                                                 Current  ($)       New  ($)           ($)
----------------------------------------------------------------------------------------------------------------
Labor cost per Renewal app...................................          131.48            21.91           109.56
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Total Registrant Impact
    The total registrant cost savings is $10,684,716 per year, 
calculated by multiplying the cost of a new and renewal application by 
the number of new and renewal applications. Table 4 details the 
calculation.

                    Table 4--Total Registrant Impact
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------------------------------------------------------------------------
Number of new applications..............................          31,172
Number of renewal applications..........................          62,344
Number of total applications............................          93,516
Cost savings per new application ($)....................          123.64
                                                         ---------------
    Subtotal, all new applications ($)..................       3,854,152
Cost savings per renewal application ($)................          109.56
                                                         ---------------
    Subtotal, all renewal applications ($)..............       6,830,565
                                                         ---------------
        Total cost savings to registrants ($)...........      10,684,716
------------------------------------------------------------------------

Additional Benefits

    There are additional benefits of the proposed rule. These include:
    (1) Shorter end-to-end process time (submission to certificate): 
Allowing earlier use of CSOS for ordering Schedule II controlled 
substances and realizing the benefits of electronic ordering rather 
than using paper order forms.
    (2) Insight into status and workflows to track the progress of the 
submission: Allowing Coordinators to get status updates online, see how 
the application progresses, and plan for additional CSOS users.
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    \21\ Note 17.
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    (3) No longer needing to wait for the call center to request 
Certificate management action revocations: Allowing Coordinators to 
self-manage and remove user certificates.
    (4) Safer submission process: Allowing secure delivery of 
potentially sensitive information.
    (5) Error checking: Allowing programmatic review for erroneous or 
incomplete information, reducing delays in application processing.

DEA Impact

    DEA's costs are driven by the personnel and technology resources 
required to process the applications. Below is a list of the cost 
activities and anticipated impact.
    1. Certification Authority (CA) Cost: The CA serves as the central 
element responsible for establishing a trust relationship between 
controlled substance manufacturers, distributors, pharmacies, and other 
DEA authorized ordering entities. CA issues user digital certificates 
used to digitally sign electronic transactions. DEA believes that the 
personnel resources and costs to certify enrollment and issue digital 
certificates will not change as a result of this proposed rule. Based 
on current CA resources, DEA estimates the annual CA cost will remain 
at $732,922.\22\
---------------------------------------------------------------------------

    \22\ Source: DEA.

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

[[Page 7038]]

    2. Registration Authority (RA) Cost: The RA is the entity that 
collects and verifies each applicant's identity and information that 
are to be entered into his or her public key certificates. Receiving 
electronic applications would eliminate the need to scan paper 
applications. DEA estimates that the personnel resources and costs to 
process enrollment applications will fall by 30 percent starting with 
the second year of implementation of the rule. However, in the first 
year of implementation, DEA anticipates the decrease in resource 
requirements from elimination of scanning requirement will be offset by 
increase in applicant questions referred to RA. DEA estimates the total 
annual RA cost of $597,688 \23\ will remain the same in year 1 and will 
be $418,382 ($597,688 x 0.7) in year 2 and thereafter.
---------------------------------------------------------------------------

    \23\ Source: DEA.
---------------------------------------------------------------------------

    3. Mail Reception Cost: Currently, DEA requires personnel to 
receive, sort, and deliver paper applications to the RA at an estimated 
annual cost of $34,562.\24\ Under the proposed rule, applications would 
be received online, eliminating this cost.
---------------------------------------------------------------------------

    \24\ Source: DEA.
---------------------------------------------------------------------------

    4. Data Entry Cost: Currently, personnel resources are needed to 
verify the accuracy of the scanned paper applications and make any 
needed corrections. Under the proposed rule, online applications would 
eliminate the need for this task. The estimated total current annual 
cost of $109,138 \25\ would be eliminated if this proposed rule were 
implemented.
---------------------------------------------------------------------------

    \25\ Source: DEA.
---------------------------------------------------------------------------

    5. Call Center Support Cost: DEA operates a CSOS call center to 
service questions, or provide assistance, regarding CSOS enrollment and 
certificate management. The estimated total current annual cost as 
$1,749,946.\26\ While DEA anticipates a reduction in the number of 
calls and duration of each call, DEA anticipates this reduction will 
result in lower wait-times for callers rather than reduced call center 
resources. Therefore, DEA estimates this cost will remain the same at 
$1,749,946.
---------------------------------------------------------------------------

    \26\ Source: DEA.
---------------------------------------------------------------------------

    6. Information Technology (IT) Cost: DEA currently spends 
approximately $255,000 per year on its IT enrollment-related systems 
and software. DEA anticipates IT costs will increase to $2,935,200 per 
year.\27\ IT cost includes, but are not limited to, cloud services, 
workflow management, identity verification, identity management 
functionality, professional services for continuous development, 
integration and deployment, and maintenance and troubleshooting.
---------------------------------------------------------------------------

    \27\ Source: DEA.
---------------------------------------------------------------------------

    All costs are expected to scale with the volume of new 
applications, except IT cost, which does not vary with the volume of 
applications. Table 5 summarizes the DEA's impact.

                                            Table 5--Total DEA Impact
                                          [Initial and remaining years]
----------------------------------------------------------------------------------------------------------------
                                                                      Year 1,                         Year 2,
                                   Current  ($)     Year 1  ($)     change from    Year 2 *  ($)    change from
                                                                   current  ($)                    current  ($)
----------------------------------------------------------------------------------------------------------------
Number of applications..........          31,172          31,172  ..............          31,172  ..............
Certificate Authority...........         732,992         732,992  ..............         418,382        -314,610
Registration Authority **.......         597,688         418,382        -179,306         418,382        -179,306
Mail preparation (received mail)          34,562  ..............         -34,562  ..............         -34,562
Data Entry......................         109,138  ..............        -109,138  ..............        -109,138
Call Center Support.............       1,749,946       1,749,946  ..............       1,749,946  ..............
Information Technology..........         255,000       2,935,200       2,680,200       2,935,200       2,680,200
                                 -------------------------------------------------------------------------------
    Total cost..................       3,479,325       5,836,519       2,357,194       5,521,909       2,042,584
----------------------------------------------------------------------------------------------------------------
* Years 2 through 10 are all assumed to be the same.
** New cost starts on second year.

Additional Benefits

    There are additional benefits to the DEA from the proposed rule. 
These include:
    (1) That the CSOS System will be supported, secure, reliable, and 
scalable: Reducing the risk of lost or stolen data and long-term 
reduction in costs associated with to maintenance, operations, and 
growth.
    (2) The Certificate management process no longer involves a help 
desk call: Call center resources will be freed up to reduce hold-times 
for registrants allowing meeting call management service level 
agreements and improving user satisfaction.
    (3) Possible increase in CSOS adoption due to ease of enrollment 
process: Reducing DEA costs associated with printing and mailing paper 
order forms.
    (4) The ease at which enhancements can be made as needed, for 
example Enterprise Certificates with multiple DEA numbers: Allowing 
efficient future improvements to CSOS.

Registrant and DEA Total Impact

    Using the registrant and DEA impacts from table 5 the estimated net 
cost savings of this proposed rule for the 10-year analysis period is 
listed in Table 8.

                                    Table 6--DEA and Registrant Total Impact
----------------------------------------------------------------------------------------------------------------
                                                                    Total cost       Net cost        Total net
                                                                    savings to    savings to DEA   cost savings,
                              Year                                  registrants      (net cost)    registrant +
                                                                        ($)             ($)          DEA  ($)
----------------------------------------------------------------------------------------------------------------
1...............................................................      10,684,716     (2,536,501)       8,148,216
2...............................................................      10,684,716     (2,357,194)       8,327,522

[[Page 7039]]

 
3...............................................................      10,684,716     (2,357,194)       8,327,522
4...............................................................      10,684,716     (2,357,194)       8,327,522
5...............................................................      10,684,716     (2,357,194)       8,327,522
6...............................................................      10,684,716     (2,357,194)       8,327,522
7...............................................................      10,684,716     (2,357,194)       8,327,522
8...............................................................      10,684,716     (2,357,194)       8,327,522
9...............................................................      10,684,716     (2,357,194)       8,327,522
10..............................................................      10,684,716     (2,357,194)       8,327,522
----------------------------------------------------------------------------------------------------------------

    The present value of the net cost savings over the 10-year analysis 
period is $70,861,367 and $58,321,453 at three and seven percent 
discount rates, respectively. The annualized net benefit is $8,307,114 
and $8,303,663 at three and seven percent, respectively.

Executive Order 12988, Civil Justice Reform

    This proposed rule meets the applicable standards set forth in 
sections 3(a) and 3(b)(2) of E.O. 12988, Civil Justice Reform to 
eliminate ambiguity, minimize litigation, establish clear legal 
standards, and reduce burdens. DEA expects the instant validation of 
online registration applications to reduce ambiguity and reduce the 
number of errors in submissions and reduce burdens on both DEA and 
registrants.

Executive Order 13132, Federalism

    This proposed rule does not have federalism implications warranting 
the application of E.O. 13132. The proposed rule does not 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.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    The proposed rule does not have substantial direct effects on one 
or more Indian tribes, on the relationship between the Federal 
government and Indian tribes, or on the distribution of power and 
responsibilities between the Federal government and Indian tribes.

Regulatory Flexibility Act

    In accordance with the Regulatory Flexibility Act (RFA), the DEA 
has reviewed the economic impact of this proposed rule on small 
entities. DEA's economic impact evaluation indicates that the rule will 
not, if promulgated, have a significant economic impact on a 
substantial number of small entities.
    The RFA requires an agency to analyze options for regulatory relief 
of small entities unless it can certify that the rule will not have a 
significant impact on substantial number of small entities. DEA has 
analyzed the economic impact of each provision of this proposed rule 
and estimates that it will have minimal economic impact on affected 
entities, including small businesses, nonprofit organizations, and 
small governmental jurisdictions.
    This proposed rule will simplify the enrollment process by 
requiring all initial registration and renewal applications be 
submitted online. The rule would affect all enrollment and renewals for 
CSOS, whose users currently use paper applications. However, once a 
registrant is enrolled the DEA already requires them to order using 
CSOS. So, there is no additional cost to obtaining access to CSOS, 
since registrants will already be required to use it eventually.
    There is a total of 94,011 CSOS participating entities, as can be 
seen in Table 7, with approximately 325,000 active certificates. 
Certificates have to be renewed every one or three years, based on the 
registrants' DEA registration renewal cycle. In 2021, the number of new 
applications were 31,172. For every third renewal, the CSOS certificate 
holder must submit a new application.\28\ Therefore, for the purposes 
of this analysis, a third renewal is considered as a new application. 
DEA estimate that the total applications, including renewals, is 
93,516.
---------------------------------------------------------------------------

    \28\ 21 CFR 1311.40(c).

                   Table 7--Percentage and Number of Registered Locations by Business Activity
----------------------------------------------------------------------------------------------------------------
                                                                     Number of                     Renewal cycle
                        Business activity                            entities         Percent         (years)
----------------------------------------------------------------------------------------------------------------
Pharmacy........................................................          62,291           66.26               3
Hospital/Clinic.................................................          11,898           12.66               3
Practitioner/Mid-Level Practitioner (MLP).......................          18,095           19.25               3
Teaching Institution............................................              14            0.01               3
Manufacturer....................................................             103            0.11               1
Distributor/Importer/Exporter...................................             444            0.47               1
Researcher......................................................             247            0.26               1
Analytical Lab..................................................              26            0.03               1
Reverse Distributor.............................................               5            0.01               1
Narcotic Treatment Program (NTP)................................             888            0.94               1
                                                                 -----------------------------------------------
Total...........................................................          94,011          100.00          * 2.97
----------------------------------------------------------------------------------------------------------------
* Weighted average.
(Source: DEA).


[[Page 7040]]

    This proposed rule affects all new and renewal enrollment 
applications for CSOS, as applications will have to take place online, 
and all entities who would submit new and renewal applications. This 
proposed rule would affect small entities in industries associated with 
the above business activities, primarily industries associated with 
pharmacy, hospital/clinic, and practitioner/MLP registrations, as these 
business activities make up 98.17% of the CSOS-participating 
registrations. Table 8 indicates the sectors, as defined by the North 
American Industry Classification System (NAICS), that best correlate 
with business activities affected by the proposed rule.

        Table 8--Industrial Sectors Affected by the Proposed Rule
------------------------------------------------------------------------
        Business activity           NAICS code   NAICS code description
------------------------------------------------------------------------
Pharmacy.........................       445110  Supermarkets and Other
                                                 Grocery (except
                                                 Convenience) Stores.
                                        446110  Pharmacies and Drug
                                                 Stores.
                                        452210  Department Stores.
                                        452311  Warehouse Clubs and
                                                 Supercenters.
NTP, Hospital/Clinic,                   621111  Offices of Physicians
 Practitioner, MLP*.                             (except Mental Health
                                                 Specialists).
                                        621112  Offices of Physicians,
                                                 Mental Health
                                                 Specialists.
                                        621330  Offices of Mental Health
                                                 Practitioners (except
                                                 Physicians).
                                        621420  Outpatient Mental Health
                                                 and Substance Abuse
                                                 Centers.
                                        621491  HMO Medical Centers.
                                        621493  Freestanding Ambulatory
                                                 Surgical and Emergency
                                                 Centers.
                                        622110  General Medical and
                                                 Surgical Hospitals.
                                        622210  Psychiatric and
                                                 Substance Abuse
                                                 Hospitals.
                                        622310  Specialty (except
                                                 Psychiatric and
                                                 Substance Abuse)
                                                 Hospitals.
Teaching Institute...............       611310  Colleges, Universities
                                                 and Professional
                                                 Schools.
Manufacturer.....................       325411  Medicinal and Botanical
                                                 Manufacturing.
                                        325412  Pharmaceutical
                                                 Preparation
                                                 Manufacturing.
Distributor, Importer, Exporter..       424210  Drugs and Druggists'
                                                 Sundries Merchant
                                                 Wholesalers.
Researcher.......................       541715  Research and Development
                                                 in the Physical,
                                                 Engineering, and Life
                                                 Sciences (except
                                                 Nanotechnology and
                                                 Biotechnology).
Analytical Labs..................       541380  Testing Laboratories.
Reverse Distributor..............       562213  Solid Waste Combustors
                                                 and Incinerators.
                                        562219  Other Nonhazardous Waste
                                                 Treatment and Disposal.
------------------------------------------------------------------------
* Practitioners and mid-level practitioners are generally employed in
  one of these industries.

    As shown in Table 8, the proposed rule would affect a wide variety 
of entities across many industry sectors. Some industry sectors are 
expected to consist primarily of DEA CSOS registrants (i.e., 446110--
Pharmacies and Drug Stores, 622110--General Medical and Surgical 
Hospitals, etc.). Therefore, this proposed rule is expected to affect a 
substantial number of small entities in some industries.
    There are no new costs associated with this proposed rule. The 
labor burden to submit an application is estimated to be the same for 
electronic and paper submissions. All CSOS registered location will 
already need to have access to the internet in order to use CSOS. DEA 
acknowledges some applicants prefer paper forms. DEA does not have a 
basis to quantify this preference; however, DEA believes any costs 
associated with eliminating this preference is offset by the cost 
savings discussion below.
    DEA anticipates there will be cost savings associated with 
electronic submissions. Some cost savings are described qualitatively 
and some are quantified. Many paper applications submitted contain 
illegible or erroneous information or omit required information. Many 
such errors or omissions, such as not including a signature or paying 
the wrong amount, require DEA to contact applicants to correct or 
clarify the information in the paper form, consuming DEA's and the 
applicant's time and resources. Electronic submissions are expected to 
virtually eliminate the requirement for DEA to contact applicants for 
clarifications of form data or correction of submission errors, as 
validation features in the system will flag common errors prior to 
transmission. As DEA has not tracked the number of delays or the 
duration of such delays, DEA does not have a basis to quantify the cost 
savings.
    Furthermore, this proposed rule would eliminate the need to print 
paper forms and transmit by mail or courier service, generating an 
estimated cost savings of $11.13 per each paper application not 
submitted.\29\ DEA assumes the cost savings associated with eliminating 
printing costs and envelopes is negligible. This proposed rule would 
also eliminate the need to get a notary for new applications, which 
will save $5.00 each for applications for registrant and coordinator 
roles.\30\ An application for POA role does not require a notary; and 
while there would be no notary cost savings for these applications, $5 
cost savings is included in the analysis to be conservative and because 
applications for registrant and coordinator roles are slightly more 
than half of all applications.
---------------------------------------------------------------------------

    \29\ Note 18.
    \30\ Note 20.
---------------------------------------------------------------------------

    As discussed in the E.O. 12866 section above, DEA estimates that 
the time savings from this proposed rule will save $109.56 per new and 
renewal application.
    Total cost savings for a new application is $125.69 (109.56 + 11.13 
+ 5.00 = 125.69), as can be seen in Table 9.

[[Page 7041]]



                                    Table 9--Cost Savings per New Application
----------------------------------------------------------------------------------------------------------------
                                                                                                   Cost savings
                                                                   Current  ($)      New  ($)           ($)
----------------------------------------------------------------------------------------------------------------
Labor cost per New app..........................................          262.95          153.39          109.56
Postage cost per app............................................           11.13  ..............           11.13
Cost of notary..................................................            5.00  ..............            5.00
                                                                 -----------------------------------------------
    Total.......................................................  ..............  ..............          125.69
----------------------------------------------------------------------------------------------------------------

    As also calculated in the E.O. 12866 section above, total cost 
savings for renewals is $109.56, as can be seen in Table 10.

                                 Table 10--Cost Savings Per Renewal Application
----------------------------------------------------------------------------------------------------------------
                                                                                                   Cost savings
                                                                   Current  ($)      New  ($)           ($)
----------------------------------------------------------------------------------------------------------------
Labor cost per Renewal app......................................          131.48           21.91          109.56
                                                                 -----------------------------------------------
    Total.......................................................  ..............  ..............          109.56
----------------------------------------------------------------------------------------------------------------

    There were 31,172 new applications in 2021. DEA estimates there 
were also 62,344 renewal applications for a total of 93,516 
applications. Given there are 94,011 CSOS participating entities, there 
is less than one application per year per entity on average (93,516/
94,011 = 0.99). Given that there are at approximately 325,000 active 
digital certificates, the vast majority of which are on three-year 
renewal cycles, DEA expects approximately 108,333 certificates to be 
renewed annually (325,000/3 = 108,333). There are then approximately 
1.15 certificates per entity (108,333/94,011 = 1.15). Given that 
smaller firms should have less certificates than larger firms, DEA 
believes using one certificate or one application per entity per year 
is a reasonable assumption for the smallest of small entities.
    To determine whether the proposed rule would have a significant 
economic impact on small entities, DEA conducted a revenue test by 
comparing the estimated annual cost savings to the average annual 
revenue for the smallest of small entities in industries affected by 
the proposed rule. Based on the Statistics of U.S. Businesses data from 
the Census Bureau, table 11 lists the enterprise size, number of 
establishments, and the average annual revenue for the smallest of 
small businesses in each industry sector.\31 32\
---------------------------------------------------------------------------

    \31\ Census Bureau, Statistics of U.S. Businesses Revenue Data 
by Size, 2017. https://www.census.gov/programs-surveys/susb.html. 
(Released 5/28/2021).
    \32\ Census Bureau, Statistics of U.S. Businesses Number of 
Establishment Data by Size, 2019. https://www.census.gov/programs-surveys/susb.html. (Released 2/11/2022).

                         Table 11--Average Annual Revenue of Smallest of Small Entities
----------------------------------------------------------------------------------------------------------------
                                                          Enterprise size                       Average revenue
         NAICS                 NAICS description             (number of         Number of      per establishment
                                                             employees)      establish-ments      ($ thousands)
----------------------------------------------------------------------------------------------------------------
325411................  Medicinal and Botanical                        0-4                239                690
                         Manufacturing.
325412................  Pharmaceutical Preparation                     0-4                390              1,173
                         Manufacturing.
424210................  Drugs and Druggists' Sundries                  0-4              4,076              1,512
                         Merchant Wholesalers.
445110................  Supermarkets and Other Grocery                 0-4             20,741                519
                         (except Convenience) Stores.
446110................  Pharmacies and Drug Stores.....                0-4              7,052              1,328
452210................  Department Stores..............                0-4                  3                467
452311................  Warehouse Clubs and                            0-4                 20                475
                         Supercenters.
541380................  Testing Laboratories...........                0-4              2,427                316
541715................  Research and Development in the                0-4              4,895                449
                         Physical, Engineering, and
                         Life Sciences (except
                         Nanotechnology and
                         Biotechnology).
562213................  Solid Waste Combustors and                     0-4                 15                949
                         Incinerators.
562219................  Other Nonhazardous Waste                       0-4                183                580
                         Treatment and Disposal.
611310................  Colleges, Universities, and                    0-4                458                802
                         Professional Schools.
621111................  Offices of Physicians (except                  0-4             91,892                465
                         Mental Health Specialists).
621112................  Offices of Physicians, Mental                  0-4              9,031                291
                         Health Specialists.
621330................  Offices of Mental Health                       0-4             22,653                165
                         Practitioners (except
                         Physicians).
621420................  Outpatient Mental Health and                   0-4              3,019                248
                         Substance Abuse Centers.
621491................  HMO Medical Centers............                0-4                 27                 98
621493................  Freestanding Ambulatory                        0-4              1,188                666
                         Surgical and Emergency Centers.
622110................  General Medical and Surgical                   0-4                 79             15,559
                         Hospitals.
622210................  Psychiatric and Substance Abuse                0-4                 10              1,024
                         Hospitals.
622310................  Specialty (except Psychiatric                  0-4                  8              1,965
                         and Substance Abuse) Hospitals.
----------------------------------------------------------------------------------------------------------------


[[Page 7042]]

    The estimated cost savings of $125.69 for new applications and 
$109.56 for renewal applications were compared to the average annual 
revenue for each of the NAICS codes in Table 11. For example, taking 
the smallest possible entities, HMO Medical Centers with 0-4 people, 
with an average revenue of $98,000, the benefit, in the form of cost 
savings, from new applications is $125.69 (109.56 + 11.13 + 5 = 
125.69), or 0.13 percent of revenues (125.69/98,000 = 0.0013). The 
benefit from renewals is 0.11 percent of revenues (109.56/98,000 = 
0.0011). Table 12 details the revenue test results for all affected 
NAICS codes.

                              Table 12--Revenue Test of Smallest of Small Entities
----------------------------------------------------------------------------------------------------------------
                                                   Benefit from                    Benefit from
                   NAICS        Average revenue         new         Percent of        renewal       Percent of
    NAICS       description    per establishment   applications    revenue  (%)    applications    revenue  (%)
                                 ($ thousands)          ($)                             ($)
----------------------------------------------------------------------------------------------------------------
325411......  Medicinal and                  690          125.69            0.02          109.56            0.02
               Botanical
               Manufacturing.
325412......  Pharmaceutical               1,173          125.69            0.01          109.56            0.01
               Preparation
               Manufacturing.
424210......  Drugs and                    1,512          125.69            0.01          109.56            0.01
               Druggists'
               Sundries
               Merchant
               Wholesalers.
445110......  Supermarkets                   519          125.69            0.02          109.56            0.02
               and Other
               Grocery
               (except
               Convenience)
               Stores.
446110......  Pharmacies and               1,328          125.69            0.01          109.56            0.01
               Drug Stores.
452210......  Department                     467          125.69            0.03          109.56            0.02
               Stores.
452311......  Warehouse Clubs                475          125.69            0.03          109.56            0.02
               and
               Supercenters.
541380......  Testing                        316          125.69            0.04          109.56            0.03
               Laboratories.
541715......  Research and                   449          125.69            0.03          109.56            0.02
               Development in
               the Physical,
               Engineering,
               and Life
               Sciences
               (except
               Nanotechnology
               and
               Biotechnology).
562213......  Solid Waste                    949          125.69            0.01          109.56            0.01
               Combustors and
               Incinerators.
562219......  Other                          580          125.69            0.02          109.56            0.02
               Nonhazardous
               Waste
               Treatment and
               Disposal.
611310......  Colleges,                      802          125.69            0.02          109.56            0.01
               Universities,
               and
               Professional
               Schools.
621111......  Offices of                     465          125.69            0.03          109.56            0.02
               Physicians
               (except Mental
               Health
               Specialists).
621112......  Offices of                     291          125.69            0.04          109.56            0.04
               Physicians,
               Mental Health
               Specialists.
621330......  Offices of                     165          125.69            0.08          109.56            0.07
               Mental Health
               Practitioners
               (except
               Physicians).
621420......  Outpatient                     248          125.69            0.05          109.56            0.04
               Mental Health
               and Substance
               Abuse Centers.
621491......  HMO Medical                     98          125.69            0.13          109.56            0.11
               Centers.
621493......  Freestanding                   666          125.69            0.02          109.56            0.02
               Ambulatory
               Surgical and
               Emergency
               Centers.
622110......  General Medical             15,559          125.69            0.00          109.56            0.00
               and Surgical
               Hospitals.
622210......  Psychiatric and              1,024          125.69            0.01          109.56            0.01
               Substance
               Abuse
               Hospitals.
622310......  Specialty                    1,965          125.69            0.01          109.56            0.01
               (except
               Psychiatric
               and Substance
               Abuse)
               Hospitals.
----------------------------------------------------------------------------------------------------------------

    As shown in Table 12, the revenue test for the smallest of small 
entities (0-4 employees) ranges from 0.00 percent with rounding for 
NAICS code 622110 to 0.13 percent for NAICS code 621491. Therefore, the 
economic impact of this proposed rule is not significant for the 
smallest of small entities, and the economic impact is estimated to be 
not significant on any small entity.
    In conclusion, while the proposed rule will impact a substantial 
number of small entities in at least some industries, the economic 
impact will not be significant. Therefore, this proposed rule, if 
promulgated, will not have a significant economic impact on a 
substantial number of small entities.

Unfunded Mandates Reform Act of 1995

    In accordance with the Unfunded Mandates Reform Act of 1995 
(UMRA),\33\ DEA has determined that this action would not result in any 
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.'' 
Therefore, neither a Small Government Agency Plan nor any other action 
is required under the UMRA.
---------------------------------------------------------------------------

    \33\ 2 U.S.C. 1501 et seq.
---------------------------------------------------------------------------

Paperwork Reduction Act

    This proposed rule would modify existing collection(s) of 
information requirement under the Paperwork Reduction Act (PRA).\34\ 
The proposed rule will combine all information collection into one on-
line enrollment process eliminating the need for individual forms. 
Pursuant to the PRA,\35\ DEA has identified the collections of 
information below related to this proposed rule. A person is not 
required to respond to a collection of information unless it displays a 
valid OMB control number.\36\
---------------------------------------------------------------------------

    \34\ 44 U.S.C. 3501-3521.
    \35\ 44 U.S.C. 3507(d).
    \36\ Copies of existing information collections approved by OMB 
may be obtained at http://www.reginfo.gov/public/do/PRAMain.
---------------------------------------------------------------------------

A. Collections of Information Associated With the Proposed Rule

    1. Title: CSOS Certificate Application.
    OMB Control Number: 1117-0038.

[[Page 7043]]

    Form Number: DEA-251.
    DEA is proposing to amend its regulations to require that all CSOS 
applications and supporting materials must be submitted to DEA through 
the DEA Diversion Control Division secure network application. This 
amendment would improve the submission process by aligning it with 
DEA's current requirements for other online form submissions. The 
online submission of applications and supporting material through the 
secure database will ensure DEA's receipt of documentation in a more 
timely and organized manner. This combined online form will be used for 
all CSOS user roles: DEA Registrant, Principal Coordinator/Alternate 
Coordinator, and Power of Attorney.
    DEA estimates the following number of respondents and burden 
associated with this collection of information:
     Number of respondents: 94,011.
     Frequency of response: 0.994735 (as needed, 
calculated).\37\
---------------------------------------------------------------------------

    \37\ Calculated by dividing the number of responses (93,516) by 
the number of respondents (94,011).
---------------------------------------------------------------------------

     Number of responses: 93,516.
     Burden per response: 0.75.\38\
---------------------------------------------------------------------------

    \38\ Weighted average of new and renewal applications. There are 
31,172 new applications and they take 1.75 hours. There are 62,344 
renewals and they take 0.25 hours. New applications represent 33 
percent of applications (31,172/93,516 = 0.33) and renewals 
represent 67 percent of applications (62,344/93,516 = 0.67). The 
weighted average is then 0.75 ([0.33 x 1.75] + [0.67 * 0.25] = 
0.75).
---------------------------------------------------------------------------

     Total annual hour burden: 70,137.
    Written comments and suggestions from the public and affected 
entities concerning the proposed collections of information are 
encouraged. Under the PRA, DEA is required to provide a notice 
regarding the proposed collections of information in the FR with the 
notice of proposed rulemaking and solicit public comment. Pursuant to 
the PRA,\39\ DEA solicits comments on the following issues:
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    \39\ 44 U.S.C. 3506(c)(2).
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     Whether the proposed collection of information is 
necessary for the proper performance of the functions of DEA, including 
whether the information will have practical utility.
     The accuracy of DEA's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used.
     Recommendations to enhance the quality, utility, and 
clarity of the information to be collected.
     Recommendations to minimize the burden of the collection 
of information on those who are to respond, including through the use 
of automated collection techniques or other forms of information 
technology.
    All comments concerning collections of information under the PRA 
must be submitted to the Office of Information and Regulatory Affairs, 
OMB, Attention: Desk Officer for the Department of Justice, Washington, 
DC 20503. Please state that your comments refer to RIN 1117-AB79/Docket 
No. DEA-732. All comments must be submitted to OMB on or before April 
3, 2023. The final rule will respond to any OMB or public comments on 
the information collection requirements contained in this proposed 
rule.
    If you need a copy of the proposed information collection 
instrument(s) with instructions or additional information, please 
contact the Regulatory Drafting and Policy Support Section (DPW), 
Diversion Control Division, Drug Enforcement Administration; Mailing 
Address: 8701 Morrissette Drive, Springfield, Virginia 22152; 
Telephone: (571) 362-3261.

List of Subjects in 21 CFR Part 1311

    Administrative practice and procedure, Control substances, Drug 
traffic control, Prescription drugs, Reporting and recordkeeping 
requirements.

    For the reasons stated in the preamble, DEA proposes to amend 21 
CFR part 1311 as follows:

PART 1311--REQUIREMENTS FOR ELECTRONIC ORDERS AND PRESCRIPTIONS

0
1 The authority citation for part 1311 continues to read as follows:

    Authority: 21 U.S.C. 821, 828, 829, 871(b), 958(e), 965, unless 
otherwise noted.

0
2. Amend Sec.  1311.20 by revising paragraphs (b) and (c) to read as 
follows:


Sec.  1311.20   Coordinators for CSOS digital certificate holders.

* * * * *
    (b) If the designated coordinator changes at any time, the 
Certification Authority must immediately be notified of the change and 
the new responsibilities assumed by each of the registrant's 
coordinators, if applicable. New Coordinators must complete the online 
application as provided in Sec.  1311.25.
    (c) The registrant's coordinator must inform the Certification 
Authority of all digital certificate applications, renewals and 
revocations for the registrant's users and approve applicants applying 
for a power of attorney digital certificate for a DEA registrant by 
means instructed by the Certification Authority within the system.
0
3. Revise Sec.  1311.25 to read as follows:


Sec.  1311.25   Requirements for obtaining a CSOS digital certificate.

    (a) To obtain a certificate to use for signing electronic orders 
for controlled substances, a registrant, coordinator, or person with 
power of attorney authorized to obtain a certificate for signing 
electronic orders for controlled substances for a registrant must 
complete the online enrollment process at www.deaecom.gov by:
    (1) Completing the online identification proofing process;
    (2) Providing a current listing of DEA registrations for which the 
individual has authority to sign controlled substances orders.
    (3) Uploading all copies of the power of attorney forms authorized 
by the registrant, when applicable.
    (4) Acknowledging that the applicant has read and understands the 
Subscriber Agreement and agrees to all terms contained in the Statement 
of Subscriber Obligations contained online.
    (b) When the Certification Authority verifies the applicant's 
identity and employment and approves the application, it will send the 
applicant a one-time use reference number and access code, via separate 
channels, and information on how to use them. Using this information, 
the applicant must then electronically submit a request for 
certification of the public digital signature key. After the request is 
approved, the Certification Authority will provide the applicant with 
the signed public key certificate.
    (c) Once the applicant has generated the key pair, the 
Certification Authority must prove that the user has possession of the 
key. For public keys, the corresponding private key must be used to 
sign the certificate request. Verification of the signature using the 
public key in the request will serve as proof of possession of the 
private key.
0
4. Amend Sec.  1311.40 by revising paragraphs (c) and (d) to read as 
follows:


Sec.  1311.40   Renewal of CSOS digital certificates.

* * * * *
    (c) If a CSOS certificate holder applies for a renewal before the 
certificate expires, the certificate holder may renew online at 
www.deaecom.gov twice. For every third renewal, the CSOS certificate 
holder must submit a new application and documentation, as provided in 
Sec.  1311.25.
    (d) If a CSOS certificate expires before the holder applies for a 
renewal, the certificate holder must submit a new application and all 
required documentation, as provided in Sec.  1311.25.

[[Page 7044]]

Sec.  1311.60  [Amended]

0
5. Amend Sec.  1311.60 by removing paragraph (c).

Signing Authority

    This document of the Drug Enforcement Administration was signed on 
January 24, 2023, by Administrator Anne Milgram. That document with the 
original signature and date is maintained by DEA. For administrative 
purposes only, and in compliance with requirements of the Office of the 
Federal Register, the undersigned DEA Federal Register Liaison Officer 
has been authorized to sign and submit the document in electronic 
format for publication, as an official document of DEA. This 
administrative process in no way alters the legal effect of this 
document upon publication in the Federal Register.

Scott Brinks,
Federal Register Liaison Officer, Drug Enforcement Administration.
[FR Doc. 2023-01804 Filed 2-1-23; 8:45 am]
BILLING CODE 4410-09-P