Locke Lord QuickStudy: New FDA User Fee Bill Contains Rider ‎That Would Permanently Alter FDA’s Regulation ‎of Cosmetics

On May 26, Senators Murray and Burr introduced S. 4348 (pg. 97). The primary focus of the bill was to pass reauthorizations of FDA’s critical user fee programs for drugs, medical devices and biologics, which are scheduled to expire this fall. Appended to this user fee reauthorization bill was a separate Cosmetic Modernization Bill that follows the punitive approach to regulate cosmetics that has been advocated by the NGOs who for years have been broadcasting the inaccurate narrative that cosmetics are unsafe. Cosmetics, however, have an excellent safety record supported by FDA’s own voluntary reporting program. In fact, when FDA went to a risk-based program for resource allocation, FDA specifically found that cosmetics presented by far the lowest risk of all FDA-regulated products. This new bill would forever change FDA’s regulation of cosmetics in a manner inconsistent with prior bills considered by Congress.

Legislative History of Cosmetics Modernization

Over the last 12 years there have been numerous bills that proposed to modernize and change how cosmetics are regulated in the U.S., starting with a bill that was originally proposed by the FDA that was strongly influenced by the NGOs who were silent partners to FDA’s year-long meetings with industry on cosmetic reform. The meetings with FDA broke down primarily because of FDA’s refusal to support a bill with strong federal preemption and failure to reach a consensus on reporting of non-serious adverse events, as FDA was unable to define a non-serious adverse event.

Following the breakdown on discussion of the proposed FDA Bill, numerous cosmetic reform bills have been introduced. These bills broke down into two basic categories. First were the bills that created new and draconian enforcement provisions permitting FDA to proceed against cosmetic companies by administrative proceedings as opposed to the judicial proceeding required under current law. These bills also proposed high user fees, serial review of cosmetic ingredients and non-functional constituents. These bills typically provided no federal preemption or tied preemption to ingredient review.

One of the difficulties presented by these bills was allowing the states to continue ingredient reviews based upon human health and safety risks. This approach can lead to inconsistent state determinations on ingredients that could prohibit the sale of the same product formulation in all 50 states. In fact, the EU issued the cosmetic directive to avoid this very problem by creating a single EU reviewing body to make ingredient safety determinations that would apply to all countries in the EU.

The other approach to modernization was taken by Congressman Sessions in the Sessions Bill that IBA supported. The Sessions bill recognized the need to provide true modernization by requiring mandatory registration for facilities and formulas, the reporting of serious and unexpected adverse events and the issuance of mandatory cosmetic GMPs. The Sessions approach continued the enforcement mechanisms in the current FDCA and recognized the need for industry to have the freedom to make simple structure function claims for cosmetic products without changing the regulatory status of a product from a cosmetic to a drug. Unlike the other approaches the Session Bill provided for strong federal preemption so there would be one set of laws governing cosmetics, not 50. 

S. 4348:  A Punitive Approach to Cosmetic Regulation Modernization

While the S. 4348 is a bipartisan proposal, it appears to have diverged from both prior approaches to cosmetic regulation modernization. For example, the bill appears to have been heavily influenced by the NGOs in a manner unseen in prior bills, as NGOs have explicitly exempted themselves from FDA oversight for cosmetic products, if they choose to sell cosmetics directly to consumers themselves. The NGOs also reserved superior rights to Industry with respect to their role in working with FDA to issue mandatory cosmetics GMPs. The new bill also appears to protect the plaintiffs’ bar by rejecting strong preemption for matters that would fall into the federal duties and matters that fall exclusively into enforcement by the FDA.

Under S. 4348 FDA would be able to

• Cancel your facility and formula registrations which in effect will put marketers and facilities out of business on an assertion of a reasonable probability of a serious adverse event. FDA also may order a mandatory recall and cessation of product distribution without requiring that evidence be provided by the FDA showing there is in fact a reasonable basis for the assertion.
• Cancel a company’s registration in the event of a misbranding violation for false or misleading claims without need for substantive proof of falsity.

S. 4348 will also change the way cosmetics companies do business in the following ways:

• S. 4348 would require companies to keep records for six years of consumer for complaints that suggest a heath effect from product use – which will be open for review to FDA inspectors.
• The bill would establish a heightened standard for safety substantiation from the current standard of not injurious to users under normal conditions of use to a reasonable certainty of safety – which will require larger studies to meet the new standard.
• Cosmetic GMP regulations will also expand the FDA’s inspection authority. 
• FDA rights would be expanded to inspect records of ingredients and products if there is a reasonable belief that an ingredient or product is likely to cause a serious adverse event.
• FDA would be authorized to issue fragrance allergen labeling again with no preemption on states which can still adopt varying fragrance that require warnings.
  

Conclusion

If passed as currently presented, S. 4348 would represent a wholesale overhaul of FDA’s ability to regulate the cosmetics industry with increased enforcement power balanced by few checks.  Industry stakeholders should pay close attention to this proposal and their own internal practices to make sure they will be in compliance should it pass without further revision. Particularly in the area of safety substantiation as the new law provides a heightened standard for safety substantiation.

S. 4348 also fails to provide federal preemption that will support a uniform national program for cosmetics that supports uniform ingredient distribution in all 50 states which can only be achieved by preempting the states from passing or enforcing laws that ban or limit cosmetic ingredients on for human health and safety. As long as the states can continue regulating these ingredients on a state by state basis, the ability of cosmetic companies to market the same formulation in all 50 states will continue to be an impossibility.