The Bioterrorism Act Builds A New Fence Around America

To succeed in the new climate, register your facility, fully understand prior notice requirements, build adequate inventory to avoid disruptions, and reassess relationships with suppliers and importers to best serve customers in the US. Loren Israelsen explains

On June 12, 2002, President Bush signed into law the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterror Act). This statute received quick and broad support within the US Congress as a further response to protecting the security of the US food supply in view of the events of September 11, 2001.

The Bioterror Act contains a wide variety of measures intended to close gaps or areas of potential risk with respect to the manufacturing, distribution, importation and sale of foods, including dietary supplements and related products. Title III of this act specifically focuses on foods, drugs and supplements. There are four specific provisions in which the US Food and Drug Administration (FDA) is now required to issue further regulations to meet both the intent and objectives which Congress intended. They are:

Of these four provisions, two have been given expedited status: Registration of Food Facilities (Section 305) and Prior Notice of Imported Food Shipments (Section 307). Taken together, these two provisions will significantly affect the flow of commerce and foreign goods into the US.

Registration Of Facilities
For the uninformed food or supplement company, this part of the act could cause major disruptions in the flow of supply of goods, loss of business and certainly unhappy and unsatisfied customers. Here is why. Section 305 requires that any facility engaged in manufacturing, processing, packaging or holding food for consumption in the United States must be registered with the Secretary of Health and Human Services (as delegated to FDA).

This registration requirement applies to all US as well as non-US companies that either directly manufacture and ship goods into the US or are an immediate part of the manufacturing, processing or distribution system of goods into the US. Such facilities will be assigned a unique registration number, and the US government will compile and maintain an up-to-date list of all such facilities.

Each registering company must list information, including the names and addresses of each production facility, a 24-hour key contact person and a registered agent in the US capable of receiving correspondence for and on behalf of the company. In addition, every trade name under which the registering company does business must also be revealed to the US government.

Any food imported or offered for import into the US from an unregistered foreign facility will be held at the port of entry until such foreign facility is properly registered. It is therefore clear that hundreds, if not thousands, of foreign companies must, in a correct and timely way, register their facilities or risk refusal of their shipment of goods into the US.

FDA has issued proposed regulations that permit registration of food and supplement facilities as of October 12 and must be completed by December 12, 2003. FDA has made it clear they wish all registrations to be filed electronically unless unusual or mitigating circumstances exist.

It will also be important to keep information current on these forms. So, if there are changes of facilities, key personnel or other required information, FDA must be notified in a timely way so that the registration form is always accurate.

Prior Notice
Many observers believe the prior notice of imported food shipments section, although well intended, will cause major disruption of the flow of foods and supplement ingredients into the US. Essentially, this section requires that foods being imported into the US must submit to FDA (and/or other government agencies) a notice providing the following information for each shipment:

These details must be supplied within a specific time frame prior to the goods arriving at the US port of entry, whether by air, sea or land. The final window of notification has not yet been published, but it will likely cause much difficulty in trying to both anticipate and then meet the delivery windows at the port of entry as specified in the prior notice regulation.

For companies selling natural products, specifically botanical ingredients, the requirement to identify the grower and country of origin for botanicals could become extremely difficult and burdensome. As a result, this may reshape commercial relationships between growers, distributors and brokers in order to clarify the chain of possession and ownership of such goods. It is an unhappy fact that certain regions of the world are of particular concern to the US government, and that shipments of natural products from such regions will likely be given particular scrutiny with resulting delays in goods being received to the US customer.

Reports have already been received from US companies complaining of major delays at the ports, including use of container X-ray systems to scan the entire contents of shipping containers. Any goods that fail to meet the prior notice requirements will be refused admission or will be detained subject to further investigation. All costs associated with such delays will be borne by the importer of the goods.

Commercial And Business Implications
It is clear from this brief overview of the key provisions of the new Bioterror Act that business as we know it will change in significant ways. The effective date of these regulations is December 12. It is expected that tens of thousands of registration forms and prior notice forms will descend on FDA, which will have the new responsibility of quickly evaluating, checking all of the information and making quick judgments as to what goods may proceed and what goods will be held or refused entry into the US market.

This strongly suggests that all non-US companies wishing to do business in the US must work closely with their custom brokers, importers and consultants to assure that all paperwork is submitted in a proper and timely way to avoid the likely delays that will be created by the massive inflow of notices and registration forms to FDA.

It would also seem prudent to build inventory of goods in the US toward the end of 2003 in anticipation of business interruptions. Manufacturers also should begin a review of all suppliers and vendors of botanicals and natural product materials to confirm the authenticity of all required information with respect to the grower of material, and country of origin.

At the heart of this major new initiative is a redefinition of safety that was built into this legislation, which both significantly changes the safety standard as found in DSHEA and which many observers believe will now become the de facto safety standard for virtually all products sold in the US. This new definition is as follows:
"FDA may order the detention of foods found during inspection, examination or investigation where there is credible evidence or information indicating that such article presents a threat of serious adverse health consequences or death to humans or animals."

This new Bioterror Act safety standard clearly grants broad authority and discretion to FDA and related agencies to determine whether an article, in their judgment, now represents a threat of serious adverse health consequences, which could trigger enforcement provisions.

FDA is under extraordinary pressure to finalise all regulations pertinent to the Bioterror Act and to quickly create a significant new process to receive, review and manage thousands of registration forms and many hundreds of thousands of prior notice forms for goods being shipped into the US.

It cannot be known how disruptive the implementation of these new requirements and processes will be to the flow of commerce, but companies are advised to take early steps to register, fully understand these prior notice requirements, build adequate inventory to avoid disruptions, and to reassess relationships with suppliers and importers in order to best serve customers in the US.

Loren Israelsen is president of the LDI Group in Utah, USA. For continuing updates on the bioterror legislation, regulations, policies and field reports, visit www.fda.gov/oc/bioterrorism/bioact.html
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