1. United States Food & Drug Administration Division of Import Operations and Policy Presentation to: National Customs Brokers & Forwarders Association of America January 21, 2010 FDA Filer Evaluations An Overview of Current FDA Procedures John E. Verbeten 301-594-3853john.verbeten@fda.hhs.gov

2. Division of Import Operations and Policy CDR Domenic J. Veneziano, Director CDR Domenic J. Veneziano, Director –Ted Poplawski, Special Assistant –Operations & Policy Branch John E. Verbeten, Director John E. Verbeten, Director –Systems Branch Kelle Fry, Acting Director Kelle Fry, Acting Director

3. FDA Filer Evaluations Current FDA Filer Evaluation Procedure was originally drafted in 1994 Current FDA Filer Evaluation Procedure was originally drafted in 1994 There is a revision under internal review There is a revision under internal review –Today’s presentation deals only with FDA’s current procedure

4. FDA Filer Evaluation Procedure Purpose: To evaluate the filer’s ability to transmit accurate entry data Purpose: To evaluate the filer’s ability to transmit accurate entry data Goal: To ensure FDA receives accurate entry data Goal: To ensure FDA receives accurate entry data

5. Filer Evaluations 2 stages of filer evaluations 2 stages of filer evaluations –Dual Phase –Paperless

6. Filer Evaluations Dual Phase Dual Phase is a constant evaluation phase Dual Phase is a constant evaluation phase While in Dual Phase While in Dual Phase –Electronic Releases don’t count –FDA Release not official until shown on entry docs

7. Filer Evaluations Dual Phase Dual Phase Dual Phase –Filer required to submit entry docs to FDA for ALL entries flagged FD1, FD2, FD3 or FD4 –This includes disclaimed entries

8. Filer Evaluations Dual Phase Dual Phase Dual Phase –Districts evaluate the electronic data against the entry docs for ALL Dual Phase entries for correctness –After 3 weeks and 50 entries, calculate the filer’s error rate –Less than 10% error rate = paperless filer

9. Filer Evaluations Paperless Status Once a filer is in Paperless status Once a filer is in Paperless status –No longer has to submit docs for every entry Evaluate at least every 9 months Evaluate at least every 9 months –Review limited to: System May Proceeds System May Proceeds FDA May Proceeds FDA May Proceeds Disclaims Disclaims

10. Filer Evaluations Alternate Evaluation Schedule Based on FDA-regulated lines/year Based on FDA-regulated lines/year 1-100 lines/year: every 4 years 101-1,000 lines/year: every 2 years 1,001-10,000 lines/year: every year 10,001+ lines/year: twice yearly

11. Filer Evaluations Evaluation Process FDA selects entries for evaluation FDA selects entries for evaluation System May Proceeds System May Proceeds FDA May Proceeds FDA May Proceeds Disclaims Disclaims Number of entries evaluated is a function of FDA entries transmitted Number of entries evaluated is a function of FDA entries transmitted FDA schedules evaluation with the filer FDA schedules evaluation with the filer Filer provides entry documents for selected entries Filer provides entry documents for selected entries

12. Filer Evaluations Remote Filers Entries are evaluated as if filed by the local office. Example: Entries are evaluated as if filed by the local office. Example: –Filer with offices in Chicago, New York, and Philadelphia –Entries through the Port of Chicago: Evaluated by FDA’s Chicago office Evaluated by FDA’s Chicago office Reflect in the filer’s Chicago office error rate Reflect in the filer’s Chicago office error rate Regardless of filer office location Regardless of filer office location

13. Filer Evaluations - Errors Incorrectly Disclaimed Products Incorrectly Disclaimed Products Incorrect Country of Origin Incorrect Country of Origin Incorrect FDA Product Code Incorrect FDA Product Code Incorrect FDA Manufacturer Incorrect FDA Manufacturer Incorrect FDA Shipper Incorrect FDA Shipper Incorrect Affirmation* Incorrect Affirmation* Quantity and Value* Quantity and Value* *If Submitted

14. Filer Evaluations - Errors Disclaims Limited to tariffs with FD1 or FD3 Flag Limited to tariffs with FD1 or FD3 Flag –Is the product regulated by FDA? –If the product is FDA regulated Submit entry information to FDA Submit entry information to FDA –If the product is not FDA regulated The line may be disclaimed The line may be disclaimed

15. Filer Evaluations - Errors Disclaims/FD Flags FD0 – Regulated by FDA: FDA does not want entry information FD1 – May or may not be regulated by FDA: If yes, submit entry information; if no, disclaim FD2 – Regulated by FDA: Submit entry information FD3 – May or not be a food product: If yes, submit PN and entry information; if no, disclaim FD4 – Food product: Submit PN and entry information

16. Filer Evaluations – Errors Country of Origin Country of Origin generally matches the country of declared manufacturer Country of Origin generally matches the country of declared manufacturer In limited cases, they may differ. Ex: In limited cases, they may differ. Ex: –Produce grown in Israel –Packing house in Netherlands Country of origin = Israel Country of origin = Israel Declared manufacturer = Netherlands Declared manufacturer = Netherlands VERY limited circumstances VERY limited circumstances

17. Filer Evaluations – Errors Manufacturer & Shipper Definitions of “FDA Manufacturer” and “FDA Shipper” Definitions of “FDA Manufacturer” and “FDA Shipper” –Manufacturer: site-specific location where the product is manufactured, produced, or grown –Shipper: shipper of the product identified on freight bills or bills of lading http://www.fda.gov/ForIndustry/ImportProgram/AdmissibilityDeterminationsforSh ipmentsofForeign-originOASIS/ucm077797.htm

18. Filer Evaluations – Errors Product Code Use FDA Product Code Builder Use FDA Product Code Builder –http://www.accessdata.fda.gov/SCRIPTS/ ORA/PCB/PCB.HTM http://www.accessdata.fda.gov/SCRIPTS/ ORA/PCB/PCB.HTMhttp://www.accessdata.fda.gov/SCRIPTS/ ORA/PCB/PCB.HTM –Use the tutorial –Ask your local FDA office if you have questions about a product code

19. Filer Evaluations – Errors Affirmations of Compliance Voluntary Submission Voluntary Submission Codes to indicate compliance with specific requirements Codes to indicate compliance with specific requirements If provided, are expected to be correct If provided, are expected to be correct –Failure to provide can slow the FDA entry process

20. Filer Evaluations – Errors Quantity and Value Voluntary Submission Voluntary Submission If provided, are expected to be correct If provided, are expected to be correct –Failure to provide can slow the FDA entry process

21. Filer Evaluations - Outcomes FDA District provides results in writing to the filer: FDA District provides results in writing to the filer: –Filer’s error rate –Entries with errors –Corrections Error Rate: Error Rate: <= 10%: Pass >10% : Fail

22. Filer Evaluations Outcomes Failure: Failure: –Filer put on increased evaluation cycle –More entries are reviewed –Repeated failures can lead to return to Dual Phase –FDA’s can and does work with CBP for Broker Penalties for repeat failures

23. Filer Evaluations Cooperation with CBP –19USC1641(b)(4) -- Exercise responsible supervision and control over Customs business –Also see 19CFR111.28 –Can be and has been linked to filer error rates

24. Filer Evaluations Cooperation with CBP Actions taken against an entry filer will be for a lack of ‘due diligence’ Actions taken against an entry filer will be for a lack of ‘due diligence’ When FDA goes to CBP asking for a penalty against a filer, FDA will show the filer ‘should have known better’ When FDA goes to CBP asking for a penalty against a filer, FDA will show the filer ‘should have known better’

25. Filer Evaluations FDA is limited in what we count as an error for an evaluation FDA is limited in what we count as an error for an evaluationBut If we find other things, we let CBP know about it If we find other things, we let CBP know about it

26. Filer Evaluations Closing The goal is for FDA to receive accurate and reliable entry data: The goal is for FDA to receive accurate and reliable entry data: –Allows FDA to make the best admissibility determination possible –Accurate and reliable data furthers the protection of public health and safety –Accurate and reliable data can make FDA’s admissibility process quicker –Inaccurate and unreliable data can make FDA’s admissibility process take longer

27. Questions?