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• STATEMENT BY LOUIS W. SULLIVAN, M.D. SECRETARY OF HEALTH AND HUMAN SERVICES BEFORE THE COMMITTEE ON LABOR AND HUMAN RESOURCES U.S. SENATE • ON THE FINAL REPORT OF THE ADVISORY COMMITTEE ON THE FDA MAY 15, 1991 ~ FOR RELEASE ONLY UPON DELIVERY p ~ G • . -.~ ~,

Mr. Chairman and Members of the Committee: • I am pleased to be here today to discuss the recommendations of the Food and Drug Administration (FDA) Advisory Committee, issues vital to the FDA and the health and welfare of the American people. In March 1990, I convened this Committee and directed review the mission of FDA, its structure, priorities, and budget. This morning the Committee Chairman, it to staf f ing Dr. Charles C. Edwards, presented to me the Final Report of the Committee. Dr. Edwards and the distinguished members of the Committee have carried out their mission diligently over the past year and deserve our gratitude for a job well done. Mr. Chairman, I know that you, Senator Hatch, and the other distinguished Members of the Committee have a strong interest in ~ FDA and are very knowledgeable about the issues and problems facing this Agency. This Committee has been the driving force behind much of the legislation passed by Congress to strengthen the responsibilities of the FD8 and help it better serve the American public. I look forward to working with the Committee on these matters in the future. I welcome this Report and strongly endorse many of its o FR recommendations. In many respects, the deliberations of the ~ ~ Advisory Committee will help guide our efforts to improve FDA for W m CC ~ . 1-~

2 ~ many years to come. • FDA is a critical agency. Walk into any grocery store in America and you will find that virtually any item on the shelf, down any aisle, with the exception of meat and poultry, is regulated by FDA. Similarly, FDA has the responsibility of assuring the consumer that our over-the counter and prescription medications are safe, effective, and honestly labeled in the marketplace. Almost 25 cents of every dollar spent by consumers in this country goes towards products regulated by FDA. So, our mission is vital and immense. Our challenge is to be exceptionally vigilant, always trying to improve. Many bold and ambitious developments have occurred at FDA over the past year. FDA is on the right course and will continue to move forward in the future, because of the changes we are now making and those that w4l come about as a result of the Committee's Report. However, before turning to the Committee's recommendations, I think it's important to review FDA's current direction. Recent FDA Accomrlishments One very significant development, of course, is the appointment of a most talented and capable physician, Dr. David Kessler, as the new Commissioner. I share the confidence the Members of this Committee have in him and believe that along with the Assistant

3 Secretary for Health, Dr. James Mason, we have the right team to keep FDA up to the challenge it faces. • A major role of FDA is to expedite the review of drug, biologic, and medical device products so that the most advanced therapies possible can be made available to patients while preventing the patient exposure to unreasonable or unnecessary risks. Finding ways to make the product application reviews more efficient without adding risk, is one of the basic challenges faced by FDA. We set the world standard for the safety of our drug supply and we are constantly assessing ways to improve the application review process. It is important also to recognize the role of scientific research- at FDA. FDA conducts in its many laboratories and sponsors extramural research to: assess risks associated with FDA- regulated products; set-ptandards for regulating risk levels; to develop new ways to test products and perform analysis of product samples recovered during inspections, and to conduct basic research on toxicology. These activities help FDA to maintain its position at the state-of-the-art in regulatory science and it provides the data and the theoretical justification for the level of regulation FDA exercises over products. When people take over-the-counter medicines or prescription drugs, or patients get the results of a laboratory test done on a

0- 0 4 medical device, they must have the confidence that the drug or the device is going to perform as represented and in a safe and effective manner. The consumer deserves a level playing field and the information necessary to make an informed choice among products to take personal responsibility for their own health. They need to know the whole truth. Our mission over the last year has been to build confidence in the American consumer that FDA can be relied on to regulate the safety and effectiveness of health and food products in a complex market. The ultimate payoff in enforcement is in providing safer and more effective products for the consumer. FDA has a number of enforcement tools at its disposal such as inspections, warning letters, import detentions, and recalls. In addition, FDA often refers matters to the Department of Justice for institution of civil seizures, injunctions and criminal prosecutions. The Agency initiates in the -peighborhood of 7,000 inspections, 2,000 warning letters, 2,000 recalls, ;26,000 import detentions, and about 200 seizures, civil and criminal proceedings each year. During the last year, FDA has made a strong commitment to demonstrate to the American people that it can effectively enforce FDA laws and regulations. Effective enforcement puts a stop to abuses of FDA regulations and laws by violative firms and provides a deterrent so that others who might consider whether to ~ abuse the system may think twice. ® ~ rn ~ c,D ~ ~

• • 5 We have: o Strengthened the field offices, provided more training for investigators, and are in the process of hiring an additional 100 investigators trained to develop criminal cases; o Developed a streamlined referral process to speed up criminal cases and send a clear signal that we have no tolerance for corruption and deceit; and o Supported expanded statutory authority for products regulated by FDA to debar or otherwise sanction those persons or companies who attempt to manipulate, provide false data, or otherwise undermine the various FDA product approval processes. What is the result of these actions? We hope a better protected - and more confident consumer and products which are safe and effective. In one recent case, FDA investigators discovered that a generic drug firm substituted the brand-name product for its own, made false statements in its FDA application, and then tried to cover up the evidence. After FDA referred this matter to the Department of Justice, a settlement was negotiated by the U.S. Attorney's Oftice whereby the company agreed to pay $10 million - - the largest criminal fine ever levied in FDA's history. This kind of hard hitting enforcement is needed to weed out the irresponsible and disreputable firms from those trying to serve the customer and trying to make an honest buck. ~ ~ ~ Cf~ . ~ ~~~

• • 6 We also need to strengthen the FDA's regulatory presence across- the-board. FDA needs to have -- and be perceived as having -- the stature and status to safeguard 25 percent of consumer goods in this country. The Agency's recent action against food manufacturers who misleadingly use the term "fresh" is an excellent case in point. The nation must understand that FDA has the capability -- and the will -- to be a vigilant and effective guardian of our food and drug supply. In my tenure as Secretary, I have made the timely issuance of regulations a top priority throughout the Department. I did so because consumers and industry both need a clear set of rules upon which to rely. Consumers benefit from understandable guidelines. Also, when industry has clear rules, they are better. able to police themselves. Last year, I said that iCt would get the food labeling regulations out on time -- and we have. FDA has done an excellent job in the food labeling rule-making, turning out multi-part and lengthy rules with many complex issues that have been produced on ~ sch.dulo. As a result, the American public will be better served. While clear regulations are important, we also need to make sure ~ that those industries we regulate have access to correct answers. ~ ~ First, a new office was recently established in FDA to answer ~p ca ~ . °O'~

• • 7 questions. Second, if firms have complaints or problems, they need a means to resolve them. Last fall, FDA and Dr. Mason proposed and I appointed an FDA ombudsman whose role is to help resolve disputes between regulated firms and the FDA, and to take industry complaints directly to the Commissioner. These steps will help to ensure that industry will not be held back due to a misunderstanding of FDA procedures and requirements. This kind of government and industry interaction will help to get new technologically advanced products into the hands of consumers that can make a difference in the lives of the American people. Finally, let me say a word about resources for FDA. Dr. Mason and I have strongly supported increased resources for FDA and we will continue to do so. Under my tenure, the FDA budget has increased by 43% The FY 1992 budget request supports a staffing level for FDA of 8,917 employees (FTEs), the highest in FDA's history. Are these resource levels a good start? Yes, I'm certain of it, and the American public will clearly benefit every day. ~ Increased resources for FDA are a good investment in the safety and effectiveness of our health and food products. For example, we are requesting $15 million to increase the inspection of seafood and bolster the confidence of consumers in the safety of the fish they take to the table.

• • 8 Having reviewed where FDA is headed, we can clearly see that this Agency is fulfilling its mission in an intelligent and aggressive manner. We have reason to be proud of what it has accomplished to date. But, the job is not done. We must now consider how the recommendations of the Advisory Committee can make an important difference in where FDA will go in the future. $ecommendations of the FDA Advisory Committee I strongly support many of the recommendations of the Committee. Dr. Edwards and Members of the Committee are among the brightest and most knowledgeable persons in the country on FDA issues. I especially thank them for their persistence in addressing the difficult and comprehensive FDA issues in approximately 20 meetings plus the countless hours of hard work outside of these meetings required to produce this Report. I understand that the Committee Members themselves laboriously drafted each chapter of the Final Report. I pp,rsonally congratulate them for a fine j ob. Mission and Goals First;- in considering the Ageri~ey's mission, the Committee recommended that: FDA clearly define its overall mission and develop a formal statement of purpose; (1-1) At regular intervals, the FDA must develop and make public a o ~ statement of program priorities that reflects a realistic p~ C.O ~ ~ Oo

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9 assessment of.resources; (1-2) and, FDA must apply the mission statement and priorities in its daily operations (1-3). I totally agree. The mission of FDA has grown by leaps and bounds over the last 10 years. It is important for an organization to pause periodically and rethink where they are and where they need to be. We certainly cannot let more time elapse before we take this step. • Manaaement Svstems In the category of management, the Committee recommended that: The Commissioner clarify the roles of the Agency's organizational components and their senior managers, including clear standards of performance and accountability (5-1) . It also recommended: % FDA develop better ways to develop capabilities of its managers including scientists who assume managerial responsibilities (5-2) ~ Again, I endorse these management principles. A proposal to reorganize the senior management of the Agency is currently under consideration. It would reduce the number of officials who report directly to the Commissioner and enable him to get more involved in the diverse policy issues of FDA. A decision on this ~ ~ reorganization proposal will be made soon. Cn a

10 The organizational and management structure will also benefit from the Senior Biomedical Research Service, a measure passed last year by Congress allowing special scientific positions with increased pay schedules to enable FDA and other agencies to recruit and retain the skilled talent necessary to get the job done. S Another recommendation suggests that: FDA develop adequate management information systems (5-3). I recognize and support the need to develop sophisticated computerized data capability at FDA. This need is especially great for the inspectors and investigators in the field who are on the front lines of enforcement for FDA. Resources On the subject of FDA repources, the Committee recommends: FDA begin now to correct the most urgent of its facility needs, particularly for foods and veterinary medicine laboratories and field operations (6-1); and ~ The Commissioner must have full authority and adequate funding to develop better and more consolidated facilities, including ways to utilize innovative lease-purchase ~ O strategies (6-2). ~ C?7 CD C.~ ~ CO 00 . ~ <</

• • 11 I recognize and appreciate the support and leadership of this Committee in this area, especially in moving the FDA Revitalization Act through the last Congress. On recommendations dealing with facilities, I support the consolidated facility concept. However, as the Committee points out, and I agree, we cannot ignore the short-term need to upgrade some laboratories and facilities. I intend to have the Commissioner devise a priority plan for dealing with the repair and upgrading of certain facilities over the next five years, particularly in FDA's field offices around the country. However, I also want to indicate my interest and willingness to work with Congress to develop an innovative and longer term solution to this serious problem. Enforcement With respect to enforcement policy, the Committee recommends: Congress consider ways to streamline, expand, and modernize the range of available enforcement tools (4-1). and ~ FDA must enhance priority setting in its enforcement and identify enforcement areas lacking adequate resources. More effective strategies are needed to improve the efficiency of ZND O compliance programs, including those for low-priority areas. W~A- FDA must develop clear and precise regulatory guidance as an ~ ~ i~

• • 12 essential mechanism for promoting voluntary compliance (4-2) I agree with each of these recommendations. Also, I concur that FDA could benefit from some legislative enhancements in the enforcement area. An FDA investigator needs the same number and range of enforcement tools at his or her disposal as other investigators have. A proposal which would add to FDA's enforcement tools is presently under review in the Administration. In addition, we intend to work with Congress as it considers other legislation relevant to FDA enforcement such as debarment legislation. Leaislative In the legislative arena, the Committee recommends: Congress consider the full resource implications of all new legislation affecting FDA and allow for ways to delay or make discretionary -.~he implementation of lower priority programs (2-1) and, The FDA Commissioner and the Secretary must exert stronger leadership with Congress to address the imbalance between ~ FDA's statutory responsibilities and its appropriated resources (2-2). We simply cannot expect the FDA to operate well if additional ~ resources do not accompany new legislative responsibilities. On O +~ both a staff and agency head level, we are working more closely OS ~ C~:

• • 13 with Congress than ever before. Yet, ultimately Congress will have to be the custodian of this recommendation. In order to improve the balance between FDA responsibilities and available resources, I urge that you as Members of the key Senate authorizing Committee work closely with your colleagues on the Appropriations Committee to authorize FDA user fees as appropriate. Over the long term, user fees are an essential means of improving FDA's ability to fulfill new legislative requirements as well as its basic mission. Conclusion I have discussed a number, but certainly not all, of the 29 recommendations contained in the Advisory Committee Report. Although I have only officially received this Report today, I can, at first glance, agree with many of its recommendations. Other recommendations will require more time for a careful reading. I expect that we will be moving forward on many of these in the near future. There may be a few recommendations, of course, that I would not support at this time or would not support without further information or evidence. in many instances, changes are underway at FDA and within the Public Health Service and the Department in accordance with these recommendations. I have asked Dr. Mason to work closely with Dr. Kessler to ensure that as many of the Report recommendations as possible are implemented as expeditiously as possible. I plan 0

• S 14 to take the blueprint provided in this Report and move the FDA forward. In conclusion, I believe the Report is an excellent document that will guide policy decisions on FDA issues for many years, and I again commend Dr. Edwards and members of the Committee for their superior work and diligence to the mission. This concludes my comments. I will be pleased to respond to any questions you have. 4, lv 0 V .' W 00 . ~`