Date="10/11/94" Citation="59 FR 51365" Group="legal" Type="RULE" Department="DEPARTMENT OF JUSTICE" Agency="DRUG ENFORCEMENT ADMINISTRATION (DEA), JUSTICE" Subject="Elimination of Threshold for Ephedrine"

------------------------------------------------------------ 21 CFR Parts 1310 and 1313 Elimination of Threshold for Ephedrine AGENCY: Drug Enforcement Administration (DEA), Justice. ACTION: Final rule.

------------------------------------------------------------ 21 CFR Parts 1310 and 1313 Elimination of Threshold for Ephedrine AGENCY: Drug Enforcement Administration (DEA), Justice. ACTION: Final rule. + ------------------------------------------------------------ SUMMARY: This final rule is issued by the Deputy Administrator of the Drug Enforcement Administration (DEA) to eliminate the threshold for ephedrine under provisions of the Controlled Substances Act (CSA) as amended by the Chemical Diversion and Trafficking Act of 1988 (CDTA) and the Domestic Chemical Diversion Control Act of 1993 (DCDCA) in order to reduce the diversion of ephedrine to clandestine laboratory operators. This will subject all transactions involving bulk ephedrine and single entity ephedrine drug products to the applicable provisions of the Controlled Substances Act (CSA). EFFECTIVE DATE: November 10, 1994. FOR FURTHER INFORMATION CONTACT: Howard McClain Jr., Chief, Drug and Chemical Evaluation Section, Office of Diversion Control, Drug Enforcement Administration, Washington, DC 20537 Telephone (202) 307-7183. SUPPLEMENTARY INFORMATION: On March 17, 1994, the Acting Administrator of the DEA published a proposed rule in the Federal Register (59 FR 12562) to eliminate the threshold for ephedrine under provisions of the Controlled Substances Act (CSA) as amended by the Chemical Diversion and Trafficking Act of 1988 (CDTA) and the Domestic Chemical Diversion Control Act of 1993 (DCDCA). Interested parties had until May 2, 1994 to submit comments and objections. Ephedrine is the primary precursor utilized in the clandestine synthesis of methamphetamine and methcathinone, both potent central nervous system (CNS) stimulants controlled under the CSA. The public health risks from the abuse of these drugs are well known and documented. Ephedrine is a listed chemical under the Chemical Diversion and Trafficking Act of 1988 (CDTA) (Pub. L. 100-690). Under provisions of the CDTA (21 U.S.C. 802 (39)(A)), thresholds were originally assigned to each listed chemical. The CDTA imposes reporting, recordkeeping and notification requirements for regulated transactions which meet or exceed these threshold amounts of a listed chemical. The Domestic Chemical Diversion Control Act (DCDCA) of 1993 (Pub. L. 103-200) became effective on April 16, 1994. This Act amends the CSA via modification of 21 U.S.C. 802 (39)(A) by redefining the term "regulated transaction'' as a "distribution, receipt, sale, importation, or exportation, or an international transaction involving shipment of a listed chemical, or if the Attorney General establishes a threshold amount for a specific listed chemical, a threshold amount, including a cumulative threshold amount for multiple transactions'' of a listed chemical. All regulated transactions in a listed chemical, regardless of size, are subject to CSA reporting, recordkeeping and notification requirements if no threshold is established. In addition, the DCDCA further modifies the definition of a "regulated transaction'' by removing the exemption for those transactions involving products which are marketed or distributed lawfully in the U.S. under the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.), if these products contain ephedrine (or its salts, optical isomers, or salts of optical isomers) as the only active medicinal ingredient or contain ephedrine (or its salts, optical isomers, or salts of optical isomers) in combination with therapeutically insignificant quantities of another active medicinal ingredient (21 U.S.C. 802 (39)(A)(iv)). The DCDCA also provides that the Attorney General shall by regulation remove this exemption for drug products that the Attorney General finds are being diverted in order to obtain a listed chemical for use in the illicit production of a controlled substance. The threshold for ephedrine was originally established as 1.0 kilogram for domestic, import and export transactions (54 FR 31657). The threshold of 1.0 kilogram of ephedrine base is equivalent to greater than 48,000 ephedrine 25 mg dosage units. Thresholds are continuously reviewed by DEA to determine if they are satisfactory to prevent diversion. Current evidence shows that the threshold for ephedrine of 1.0 kilogram is not adequate to prevent the diversion of ephedrine to clandestine laboratory operators in the United States. Clandestine laboratory operators are obtaining ephedrine in quantities much less than the current 1.0 kilogram threshold for use in the illicit production of methamphetamine and methcathinone. DEA had determined that in order to ensure the maximum effectiveness of the CSA in curtailing the diversion of ephedrine, there should be no threshold for ephedrine. Subsequently, all regulated transactions of ephedrine would be subject to reporting, recordkeeping and notification requirements of the CSA regardless of size. Comments Seven comments were received in response to the March 17, 1994, Notice of proposed rulemaking. Some comments pertained to provisions of the DCDCA which are not related to the ephedrine threshold. These comments will not be addressed in this Federal Register Notice, but DEA will consider them in preparing the Notice of Proposed Rulemaking pertaining to the DCDCA. A summary of relevant comments received is provided below: A comment submitted by the National Wholesale Druggist Association (NWDA) did not raise any objections to the elimination of the ephedrine threshold. NWDA, however, raised the issue that the March 17, 1994, Notice of Proposed Rulemaking does not change the definition of "regulated transaction'' in Section 1310.01 (f) to be consistent with the DCDCA. This will be remedied when the DEA publishes proposed regulations which implement the DCDCA in the near future. A comment was also received from the National Association of Boards of Pharmacy (NABP). The NABP strongly supports the elimination of the ephedrine threshold. Furthermore, the NABP expresses its support for the more restrictive actions taken by certain state authorities whereby single entity ephedrine products have been placed in controlled substance schedules or placed on prescription-only status. The NABP also states that a nationwide Federal effort is needed to better monitor the distribution of single entity ephedrine products. A comment was submitted on behalf of BDI Pharmaceuticals and raised the following issues: BDI's comment states that the elimination of the threshold is prohibitory and will remove single entity ephedrine products from retail stores. However, the elimination of the threshold only imposes recordkeeping, reporting and notification requirements and will not remove products from the market. BDI states that the increased recordkeeping burden from the elimination of the threshold will decrease the number of retail stores willing to sell ephedrine products. BDI states that 21 CFR 1310.06(d) estimates that it will take approximately ten minutes to fulfill the recordkeeping requirements for each sale. BDI further states that this is an excessive burden which will be a major factor in a merchant's decision to drop the product. However, 21 CFR 1310.06(d) does not provide an estimate of the time required to keep sales records of each regulated chemical transaction and it is estimated that creating and storing a transaction record requires an average of only one minute per record. Conversely, 21 CFR 1310.06(d) pertains to the amount of time needed for the filing of reports of suspicious transactions, unusual losses or domestic regulated transactions in a tableting or encapsulating machine as outlined in 21 CFR 1310.05. These situations, whereby reports should be filed, occur infrequently. BDI's comment makes the point that asthma is a serious condition and elimination of the threshold for ephedrine will have an adverse impact upon asthma patients because the single entity product will become unavailable. DEA recognizes that asthma is a serious condition for which ephedrine has an approved treatment indication. DEA, in an effort to ensure that the elimination of the ephedrine threshold would not adversely effect the availability of medications for the treatment of patients suffering from this condition, has circulated the March 17, 1994, Notice of Proposed Rulemaking to the U.S. Food and Drug Administration (FDA). Within FDA, this Notice of Proposed Rulemaking was circulated to several offices for review and consideration. DEA has received an official response that FDA supports the proposed threshold elimination in order to address the misuse, diversion and trafficking associated with single entity ephedrine products. In addition, FDA's formal response also states that FDA believes that there may be other ephedrine products that may also need to be considered for regulation under the CSA as amended by the CDTA and DCDCA. The comment received from the National Association of Boards of Pharmacy (NABP) which strongly supports the elimination of the ephedrine threshold also states that "NABP agrees that adoption of the proposed rule should have no significant impact on pharmacies, hospitals, or points of distribution that distribute medications containing ephedrine for the treatment of asthma and other conditions.'' The NABP comment also notes that other products are also available for the treatment of asthma. BDI's comment claims that DEA is biased against single entity ephedrine products while many advertised combination products are not considered safe and effective. On the contrary, DEA is not supporting the use of one product over another for the treatment of asthma or any other medical condition. It is not DEA's mandate to make such determinations. It is, however, DEA's responsibility to prevent the diversion of chemicals for the illicit production of controlled substances. The DCDCA removes the exemption for single entity ephedrine products. However, it is important to note that the DCDCA also provides for the removal of an exemption for any drug or group of drugs that are being diverted to obtain the listed chemical for use in the illicit production of a controlled substance. Under such provisions, combination products used in the illicit production of controlled substances can lose their exemptions and thus be subjected to recordkeeping, reporting, notification and registration requirements. DEA plans to closely monitor such activity, and is prepared to pursue the removal of exemptions for those products. BDI's comment implies that the high retail cost of its product line prevents these products from being a cost effective source of ephedrine for clandestine laboratory use. Depending upon the package size, BDI reports that 48,000 ephedrine 25 mg tablets would cost $3,000 to $9,000 at a retail outlet. In contrast, however, based on data available to DEA regarding the national range of street prices for methamphetamine in 1993, these products are a cost effective source of ephedrine for clandestine laboratory use. BDI's comment states that the comment period should be extended. However, BDI's request for extension was denied by the Administrator on the grounds that sufficient information was included in the March 17, 1994, Notice of Proposed Rulemaking and ample time given for comments to be submitted. BDI's comment states that the likely source of ephedrine at clandestine laboratories is bulk ephedrine from Canada. This is not substantiated by DEA information. Ephedrine tablets have been seized at many clandestine laboratories. It is important to note, however, that DEA has emphasized that smuggling from Mexico is also an important source of ephedrine for clandestine laboratory usage. BDI's comment states that Congress did not contemplate the complete elimination of the ephedrine threshold. On the contrary, the language in the DCDCA is specific, i.e. the DCDCA uses the language "or if the Attorney General establishes a threshold amount for a specific listed chemical''. Such language makes it clear that the normal case would be that listed chemicals would not have a threshold unless the Attorney General decides that a threshold is warranted and that the Attorney General may remove the threshold from chemicals already listed. BDI's comment states that DEA has no evidence of retail package diversion. On the contrary, DEA does have evidence of the retail diversion of ephedrine tablets as a source of precursor material for clandestine laboratory use. In addition to the smuggling of ephedrine and purchase via mail order, ephedrine is obtained through the purchase of ephedrine tablets from gas stations, convenience stores and other retail outlets. This includes small 6 count packets of ephedrine and bottles of 24 dosage units. Investigative information shows that individuals have gone from store to store to buy out the stock of ephedrine until they obtain sufficient material for desired batch sizes. T&M Distributing commented that DEA has not demonstrated that the current threshold is insufficient to control diversion, and has failed to consider the burden to public health. These specific issues have been addressed earlier in this Federal Register Notice. A comment submitted by Abbott Laboratories requested that prescription injectable products continue to be exempt under the definition of "regulated transaction''. Abbott further states that there is no evidence of diversion of these products which are sold by prescription only. While the DEA agrees that it is not currently aware of the diversion of these single entity ephedrine injectable products, the CSA does not provide for the exemption of a specific form of single entity ephedrine products. Therefore, recordkeeping, reporting and notification requirements will apply to these prescription injectable products. However, prescription and hospital records kept in the normal course of medical treatment are adequate to meet the recordkeeping requirements of 21 CFR part 1310. An Interim Rule, which modifies 21 CFR part 1310 to clarify this, will be published in the Federal Register. Several comments proposed alternatives to the elimination of the threshold. BDI proposed that there be no monthly cumulative threshold for retail stores which stock only packages of 100 tablets or less and limit sales to 2.5 grams per transaction. A comment submitted by The Hammer Corporation suggested an alternative threshold of 61 tablets per individual transaction and 6000 tablets per month. Mr. G's Manufacturer and Wholesale Distributors suggested that 6 count or 42 count package sizes should be exempt at the retail level. T&M Distributing suggested that a threshold of 12,000 capsules or tablets per month be instituted. DEA has considered all of these comments and suggested alternatives. However, given the small batch sizes encountered at U.S. clandestine methamphetamine and methcathinone laboratories, evidence of the diversion of ephedrine from various types of outlets, and the public health threat imposed by the diversion of these ephedrine products, DEA has determined that none of the suggested alternatives are sufficient to prevent the diversion of ephedrine consistent with the intentions of the Domestic Chemical Diversion Control Act of 1993 (DCDCA). Therefore DEA had determined that the elimination of the ephedrine threshold is necessary. In making this determination, DEA recognizes that additional entities which distribute ephedrine products will not be required to keep records. Many of the entities which distribute ephedrine products are truckstops, convenience stores, gas stations and liquor stores. DEA has determined that (1) the sale of ephedrine is not a principal business activity of these entities and (2) the recordkeeping, reporting and notification requirements resulting from the elimination of the threshold are essential to prevent and detect the diversion of ephedrine products to clandestine laboratories. The Attorney General has delegated authority under the CSA and all subsequent amendments to the CSA to the Administrator of the DEA (28 CFR 0.100) The Administrator, in turn, has redelegated this authority to the Deputy Administrator pursuant to 28 CFR 0.104 (59 FR 23637 (May 6, 1994)). The Deputy Administrator hereby certifies that this proposed rulemaking will have no significant impact upon entities whose interests must be considered under the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. This position is further supported by The National Association of Boards of Pharmacy (NABP) which commented that the elimination of the ephedrine threshold "should have no significant impact on pharmacies, hospitals, or points of distribution that distribute medications containing ephedrine for the treatment of asthma and other conditions''. This final rule is not a significant regulatory action and therefore has not been reviewed by the Office of Management and Budget pursuant to Executive Order 12866. This action has been analyzed in accordance with the principles and criteria in E.O. 12612, and it has been determined that the final rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment. List of Subjects 21 CFR Part 1310 Drug traffic control, Reporting and recordkeeping requirements. 21 CFR Part 1313 Drug traffic control, Chemical importation and exportation requirements. For reasons as set out above, 21 CFR part 1310 is amended as follows: PART 1310-[AMENDED] 1. The authority citation for part 1310 continues to read as follows: Authority: 21 U.S.C. 802, 830, 871(b). 2. Section 1310.04 is amended by revising the introductory text to paragraph (f); removing paragraph (f)(1)(iii); redesignating paragraphs (f)(1)(iv) through (f)(1)(xxiv) as (f)(1)(iii) through (f)(1)(xxiii) respectively; and adding a new paragraph (g) to read as follows: sec 1310.04 Maintenance of records. * * * * * (f) For those listed chemicals for which thresholds have been established, the quantitative threshold or the cumulative amount for multiple transactions within a calendar month, to be utilized in determining whether a receipt, sale, importation or exportation is a regulated transaction is as follows: * * * * * (g) For listed chemicals for which no thresholds have been established, the size of the transaction is not a factor in determining whether the transaction meets the definition of a regulated transaction as set forth in sec 1310.01(f). All such transactions, regardless of size, are subject to recordkeeping and reporting requirements as set forth in this part 1310 and notification provisions as set forth in part 1313 of this chapter. (1) Listed Chemicals For Which No Thresholds Have Been Established: (i) Ephedrine, its salts, optical isomers, and salts of optical isomers (ii) [Reserved] (2) [Reserved] For reasons as set out above, 21 CFR part 1313 is amended as follows: PART 1313-[AMENDED] 1. The authority citation for part 1313 continues to read as follows: Authority: 21 U.S.C. 802, 830, 871(b), 971. 2. Section 1313.12 is amended by revising the introductory text to paragraph (a) to read as follows: sec 1313.12 Requirement of authorization to import. (a) Each regulated person who imports a listed chemical that meets or exceeds the threshold quantities identified in sec 1310.04(f) or is a listed chemical for which no threshold has been established as identified in sec 1310.04(g) of this chapter, shall notify the Administrator of the importation not later than 15 days before the transaction is to take place. * * * * * 3. Section 1313.21 is amended by revising the introductory text to paragraph (a) to read as follows: sec 1313.21 Requirement of authorization to export. (a) No person shall export or cause to be exported from the United States any chemical listed in sec 1310.02 of this chapter, which meets or exceeds the threshold quantities identified in sec 1310.04(f) or is a listed chemical for which no threshold has been established as identified in sec 1310.04(g) of this chapter, until such time as the Administrator has been notified. Notification must be made not later than 15 days before the transaction is to take place. In order to facilitate the export of listed chemicals and implement the purpose of the Act, regulated persons may wish to provide notification to the Administration as far in advance of the 15 days as possible. * * * * * Dated: August 24, 1994. Stephen H. Greene, Deputy Administrator, Drug Enforcement Administration. [FR Doc. 94-25070 Filed 10-7-94; 8:45 am] BILLING CODE 4410-09-M ------------------------------------------------------ The Contents entry for this article reads as follows: Chemical Diversion and Trafficking Act of 1988; implementation: Ephedrine; threshold elimination, 51365