The CARES Act, enacted in March 2020, amended the FD&C Act to provide authority to assess and collect annual facility fees from owners of qualifying OTC monograph drug facilities (in addition to fees for OTC monograph order requests). FDA announced these fees in a December 29, 2020 Federal Register Notice titled “Fee Rates Under the Over-the-Counter Monograph Drug User Fee Program for Fiscal Year 2021”.
The FDA appreciates the concerns raised by non-traditional hand sanitizer manufacturers, who began producing this product in response to the COVID-19 Public Health Emergency, with respect to facility fees under this user fee program. The December 29, 2020 Federal Register Notice has been withdrawn. The Department of Health and Human Services (HHS) has issued a new Notice stating that:
[T]he Department clarifies that persons that were not registered with FDA as drug manufacturers prior to the COVID-19 Public Health Emergency, which then later registered with FDA for the purpose of producing hand sanitizers, are not “identified” as “OTC drug manufacturing facilit[ies]” under section 744M of the FD&C Act, 21 U.S.C. 379j-72, and are thus not subject to the facility fee contained therein. [Docket no. FDA–2020–N–2246]
Accordingly, FDA will not assess facility fees on those companies that first entered the over-the-counter drug market only to produce hand sanitizer during the COVID-19 Public Health Emergency.
Under the HHS Notice, facility fees will apply to firms which “(1) manufacture, distribute, and sell over-the-counter drugs in addition to hand sanitizer or (2) continue to manufacture (as opposed to hold, distribute, or sell existing inventories) hand sanitizer products as of December 31 of the year immediately following the year during which the COVID-19 Public Health Emergency is terminated.”
For background, FDA issued guidance in March 2020 entitled “Temporary Policy for Preparation of Certain Alcohol-Based Hand Sanitizer Products During the Public Health Emergency (COVID-19) Guidance for Industry.” The guidance outlines that the Agency does not intend to take action against manufacturing firms that, consistent with the guidance, prepare alcohol-based hand sanitizers for consumer use and for use as health care personnel hand rubs during the ongoing public health emergency.
FDA remains committed to working with all parties to ensure an adequate supply of this important public health tool to help all Americans practice good hand hygiene. FDA intends to continue implementation of the OTC monograph drug user fee program enacted by Congress in an appropriate and transparent manner, including with respect to facility fees, and in accordance with the HHS Notice.
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