HHS: Distilleries won't have to pay FDA fees of more than $14K for making hand sanitizers ...

[mahatmakanejeeves]

WeakAndTiredHat Retweeted

Some good news in the final hours of a terrible year:
@jacobgrier
's
@reason
story about craft distillers who pivoted to hand sanitizer getting slammed with FDA fees seems to have gotten noticed in the right places

Link to tweet

CORONAVIRUS

In a Last-Minute Reversal, HHS Voids FDA Fees on Distillers Who Produced Emergency Hand Sanitizer

Thanks to coverage at Reason and pushback from the industry, the federal government voided $14,000 fees on do-gooder craft distillers just in time for the new year.

JACOB GRIER | 12.31.2020 9:49 PM

It's been a whirlwind 24 hours for American craft distillers, but 2020 is ending with some good news: Thanks to media coverage, including here at Reason, of an unexpected and substantial fee imposed by the Food and Drug Administration (FDA) on distillers who pivoted to produce much-needed hand sanitizer, the federal government has reversed course on what would have been a devastating blow to small businesses.

In the early days of the COVID-19 pandemic, many distillers shifted their production from spirits to hand sanitizer, complying with emergency guidance from the FDA. Much of this sanitizer was donated or sold at a low margin, helping to alleviate a dire shortage. These same distilleries were surprised this week by a notice from the FDA informing them that they were required to pay a fee of more than $14,000 as over-the-counter drug production facilities to cover the costs of FDA regulation.

Late today, however, the Department of Health and Human Services (HHS) reversed the policy. In a statement posted to Twitter, HHS Chief of Staff Brian Harrison said, "Small businesses who stepped up to fight COVID-19 should be applauded by their government, not taxed for doing so. I'm pleased to announce we have directed FDA to cease enforcement of these arbitrary, surprise user fees. Happy New Year, distilleries, and cheers to you for helping keep us safe!"

Link to tweet

In a longer statement, HHS leadership distanced itself from the initial policy: "This action was not cleared by HHS leadership, who only learned of it through media reports late yesterday. HHS leadership convened an emergency meeting late last night to discuss the matter and requested an immediate legal review. The HHS Office of the General Counsel (OGC) has reviewed the matter and determined that the manner in which the fees were announced and issued has the force and effect of a legislative rule. Only the HHS Secretary has the authority to issue legislative rules, and he would never have authorized such an action during a time in which the Department is maximizing its regulatory flexibility to empower Americans to confront and defeat COVID-19."

{snip}

HHS: Distilleries won't have to pay FDA fees of more than $14K for making hand sanitizers amid pandemic

Coral Murphy USA TODAY
Published 2:04 p.m. ET Dec. 31, 2020 | Updated 6:50 p.m. ET Dec. 31, 2020

Distilleries across the U.S. received a surprise fee from the Food and Drug Administration after using their facilities to make hand sanitizer amid the COVID-19 pandemic.

As COVID-19 cases began surging in March, distilleries started making hand sanitizer by switching their alcohol production to antiseptic, undrinkable alcohol and giving away bottles to members of their communities.

The efforts rose after the country faced a shortage in hand sanitizer as shoppers panic bought hand soap, cleaning wipes and other sanitation products.

The CARES Act enacted in March included a non-prescription drug policy, making distilleries producing hand sanitizer "over-the-counter drug monograph facilities." The CARES Act also established these facilities must pay user fees under the over the counter monograph drug user fee program. ... The fees impacting distillers are a $14,060 Monograph Drug Facility Fee and $9,373 Contract Manufacturing Organization Facility Fee due on Feb. 12.

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[bullimiami]

1. This deserves its own small investigation.

[OnDoutside]

2. I really don't think it does, it was more likely someone at a lower level

applying whatever the standard is. The clue is that as soon as the higher ups had it pointed out, they ordered the change. There wasn't resistance to fixing it.