Federal
Register Notices > Rules -
2007 >
Removal of Thresholds for the List I Chemicals Pseudoephedrine and
Phenylpropanolamine
FR Doc E7-22560 [Federal Register: November 20, 2007 (Volume 72, Number
223)] [Proposed Rules] [Page 65248-65256] From the Federal Register Online via
GPO Access [wais.access.gpo.gov] [DOCID:fr20no07-15]
DEPARTMENT OF JUSTICE
Drug Enforcement Administration
21 CFR Part 1310
[Docket No. DEA-296P] RIN 1117-AB10
Removal of Thresholds for the List I Chemicals Pseudoephedrine and
Phenylpropanolamine
AGENCY: Drug Enforcement Administration, Department of Justice.
ACTION: Notice of proposed rulemaking.
SUMMARY: The Drug Enforcement Administration (DEA) is proposing to remove
the thresholds for importation, exportation, and domestic distributions of the
List I chemicals pseudoephedrine and phenylpropanolamine. This rulemaking is
being conducted as part of
[[Page 65249]]
DEA's implementation of the Combat Methamphetamine Epidemic Act of 2005 and
is needed to implement the Act's requirements for import and production quotas
and to address the potential diversion of these chemicals. DEA is also
clarifying that all transactions of drug products containing ephedrine,
pseudoephedrine, and phenylpropanolamine, except retail transactions, are
considered to be regulated transactions.
DATES: Written comments must be postmarked, and electronic comments must be
sent, on or before January 22, 2008.
ADDRESSES: To ensure proper handling of comments, please reference "Docket
No. DEA-296'' on all written and electronic correspondence. Written comments
being sent via regular mail should be sent to the Deputy Assistant
Administrator, Office of Diversion Control, Drug Enforcement Administration,
Washington, DC 20537, Attention: DEA Federal Register Representative/ODL.
Written comments sent via express mail should be sent to DEA Headquarters,
Attention: DEA Federal Register Representative/ODL, 8701 Morrissette Drive,
Springfield, VA 22152. Comments may be directly sent to DEA electronically by
sending an electronic message to dea.diversion.policy@usdoj.gov. Comments may
also be sent electronically through http://www.regulations.gov using the
electronic comment form provided on that site. An electronic copy of this
document is also available at the http://www.regulations.gov web site. DEA
will accept attachments to electronic comments in Microsoft Word, WordPerfect,
Adobe PDF, or Excel file formats only. DEA will not accept any file formats
other than those specifically listed here.
Posting of Public Comments: Please note that all comments received are
considered part of the public record and made available for public inspection
online at http://www.regulations.gov and in the Drug Enforcement
Administration's public docket. Such information includes personal identifying
information (such as your name, address, etc.) voluntarily submitted by the
commenter.
If you want to submit personal identifying information (such as your name,
address, etc.) as part of your comment, but do not want it to be posted online
or made available in the public docket, you must include the phrase "PERSONAL
IDENTIFYING INFORMATION'' in the first paragraph of your comment. You must
also place all the personal identifying information you do not want posted
online or made available in the public docket in the first paragraph of your
comment and identify what information you want redacted.
If you want to submit confidential business information as part of your
comment but do not want it to be posted online or made available in the public
docket, you must include the phrase "CONFIDENTIAL BUSINESS INFORMATION'' in
the first paragraph of your comment. You must also prominently identify
confidential business information to be redacted within the comment. If a
comment has so much confidential business information that it cannot be
effectively redacted, all or part of that comment may not be posted online or
made available in the public docket.
Personal identifying information and confidential business information
identified and located as set forth above will be redacted and the comment, in
redacted form, will be posted online and placed in the Drug Enforcement
Administration's public docket file. If you wish to inspect the agency's
public docket file in person by appointment, please see the For Further
Information paragraph.
FOR FURTHER INFORMATION CONTACT: Mark W. Caverly, Chief, Liaison and Policy
Section, Office of Diversion Control, Drug Enforcement Administration,
Washington, DC 20537 at (202) 307-7297.
SUPPLEMENTARY INFORMATION:
DEA's Legal Authority
DEA implements the Comprehensive Drug Abuse Prevention and Control Act of
1970, often referred to as the Controlled Substances Act (CSA) and Controlled
Substances Import and Export Act (21
U.S.C. 801-971), as amended. DEA
publishes the implementing regulations for these statutes in Title 21 of the
Code of Federal Regulations (CFR), parts 1300 to 1399. These regulations are
designed to ensure that there is a sufficient supply of controlled substances
for legitimate medical, scientific, research, and industrial purposes and
deter the diversion of controlled substances to illegal purposes. The CSA
mandates that DEA establish a closed system of control for manufacturing,
distributing, and dispensing controlled substances. Any person who
manufactures, distributes, dispenses, imports, exports, or conducts research
or chemical analysis with controlled substances must register with DEA (unless
exempt) and comply with the applicable requirements for the activity. The CSA,
as amended, also requires DEA to regulate the manufacture, distribution,
retail sale, import, and export of chemicals that may be used to manufacture
controlled substances illegally. Listed chemicals that are classified as List
I chemicals are important to the manufacture of controlled substances. Those
classified as List II chemicals may be used to manufacture controlled
substances.
On March 9, 2006, the President signed the Combat Methamphetamine Epidemic
Act of 2005 (CMEA), which is Title VII of the USA PATRIOT Improvement and
Reauthorization Act of 2005 (Pub. L. 109-177). Among other actions, CMEA
imposed new requirements regarding the retail sale of scheduled listed
chemical products (products containing ephedrine, pseudoephedrine, or
phenylpropanolamine, that may be marketed or distributed lawfully in the
United States under the Federal Food, Drug and Cosmetic Act as nonprescription
products) (21 U.S.C.
802(45)(A)). In a separate rulemaking, "Retail Sales of
Scheduled Listed Chemical Products; Self-Certification of Regulated Sellers of
Scheduled Listed Chemical Products'' [Docket No. DEA-291, RIN 1117-AB05] (71
FR 56008, September 26, 2006; corrected at 71 FR 60609, October 13, 2006), DEA
promulgated regulations implementing these provisions. The CMEA also subjects
material containing ephedrine, pseudoephedrine, and phenylpropanolamine to
manufacturing and import restrictions. Specifically, CMEA amended section 1002
of the Controlled Substances Act (21 U.S.C.
952(a)(1)) by adding the List I
chemicals ephedrine, pseudoephedrine, and phenylpropanolamine to those
narcotic raw materials whose importation into the United States is prohibited
except for such amounts as the Attorney General finds to be necessary to
provide for medical, scientific, or other legitimate purposes. In a separate
rulemaking, "Import and Production Quotas for Certain List I Chemicals''
[Docket No. DEA-293, RIN 1117-AB08] (72 FR 37439, July 10, 2007), DEA
promulgated regulations to implement these provisions. Further, the CMEA
requires that importers of all listed chemicals provide DEA with information
regarding the transferee, (i.e., the downstream customer) of the chemical, as
well as information regarding the quantity of the chemical to be transferred.
Importers are further required to provide DEA with a return declaration
regarding each import after the transaction is completed (CMEA Sec. 716, 21
U.S.C. 971(d) and (g), as
[[Page 65250]]
amended). In a separate rulemaking, "Implementation of the Combat
Methamphetamine Epidemic Act of 2005; Notice of Transfers Following
Importation or Exportation'' [Docket No. DEA-292, RIN 1117-AB06] (72 FR 17401,
April 9, 2007; Temporary Stay of Certain Provisions 72 FR 28601, May 22,
2007), DEA promulgated regulations implementing these provisions. Further, the
CMEA requires that the notice of importation (DEA Form 486) for ephedrine,
pseudoephedrine, and phenylpropanolamine "shall include all information known
to the importer on the chain of distribution of such chemical from the
manufacturer to the importer.'' (CMEA Sec. 721, 21 U.S.C. 971(h) as amended).
In a separate rulemaking, "Information of Foreign Chain of Distribution for
Certain List I Chemicals'' [Docket No. DEA-295, RIN 1117-AB07], DEA is
promulgating regulations to implement this provision.
Ephedrine, Pseudoephedrine, and Phenylpropanolamine
The List I chemicals ephedrine, pseudoephedrine, and phenylpropanolamine
all serve as precursor chemicals for the illicit manufacture of controlled
substances. Ephedrine and pseudoephedrine are the primary precursors used in
the synthesis of the controlled substances methamphetamine, a schedule II
controlled substance, and methcathinone, a schedule I controlled substance.
Phenylpropanolamine is the primary precursor used in the illicit synthesis of
amphetamine, a schedule II controlled substance.
Licit Use
Ephedrine, pseudoephedrine, and phenylpropanolamine all have therapeutic
uses in both over-the-counter and prescription drug products. Ephedrine is
lawfully marketed under the Federal Food, Drug, and Cosmetic Act as an
ingredient in nonprescription ("over-the- counter'' (OTC)) drugs as a
bronchodilator for the treatment of asthma. Ephedrine is also available OTC in
combination with the active ingredient guaifenesin.
As a prescription drug, ephedrine is used in parenteral (injectable) form
in hospitals as part of an anesthesiology kit. Ephedrine has the beneficial
effect of increasing blood pressure very rapidly in the event of hypotensive
crisis (i.e., sudden loss of blood pressure sometimes experienced during
surgery). Parenteral ephedrine is also sometimes used to relieve acute
bronchospasm. Oral dosage forms of ephedrine are also available as
prescription drugs for the treatment of asthma. These prescription drug
products primarily consist of ephedrine in combination with other active
ingredients such as potassium iodide (an expectorant) and/or theophylline (a
bronchospamolytic). Pseudoephedrine is lawfully marketed under the Federal
Food, Drug, and Cosmetic Act provisions for OTC use as a decongestant.
Phenylpropanolamine has historically been marketed in the United States for
OTC use as a decongestant and diet aid and there have been many legend
(prescription) drug products that contain pseudoephedrine or
phenylpropanolamine. In the vast majority of these preparations,
pseudoephedrine or phenylpropanolamine were in combination with other active
ingredients, such as antihistamines, expectorants, and/or antitussives.
In November 2000, the U.S. Food and Drug Administration (FDA) issued a
public health advisory concerning phenylpropanolamine and requested that all
drug companies discontinue marketing products containing phenylpropanolamine
due to risk of hemorrhagic stroke. In response, many companies have
voluntarily reformulated their products to exclude phenylpropanolamine.
Subsequently, on December 22, 2005, the FDA published a Notice of Proposed
Rulemaking (70 FR 75988) proposing to categorize all over-the-counter nasal
decongestants and weight control drug products containing phenylpropanolamine
preparations as Category II, nonmonograph, i.e., not generally recognized as
being safe for human consumption. Most products containing phenylpropanolamine
intended for humans have been withdrawn from the market, but
phenylpropanolamine is still sold by prescription for veterinary uses.
While ephedrine and pseudoephedrine are pharmacologically different (and
have quite different therapeutic uses), they are directly substitutable in the
production of methamphetamine. This is because of the similarity of the
chemical structures of the two drugs.
Discussion of This Rule
In this rule, DEA is addressing two issues related to CMEA implementation.
First, DEA is proposing to eliminate the thresholds for distribution,
importation, and exportation of pseudoephedrine and phenylpropanolamine; the
threshold for distribution, importation, and exportation of ephedrine was
eliminated previously. Limits on retail transactions are set in the CMEA and
were addressed in DEA's Interim Rule regarding the retail provisions of the
CMEA (71 FR 56008, September 26, 2006; corrected at 71 FR 60609, October 13,
2006). Second, DEA is proposing to clarify that all distribution, importation,
and exportation transactions involving drug products containing ephedrine,
pseudoephedrine, or phenylpropanolamine are regulated transactions.
Thresholds
Under the existing regulations (21 CFR
1310.04), the threshold for
non-retail distribution, import, and export of pseudoephedrine is 1 kilogram
and for phenylpropanolamine, 2.5 kilograms. A single transaction or multiple
transactions in a month with a single customer that equal or exceed the
threshold are considered regulated transactions and trigger the reporting and
recordkeeping requirements of 21 CFR part 1310. DEA has not established a
threshold for ephedrine; all non-retail distribution, import, and export
transactions involving ephedrine are already subject to recordkeeping and
reporting requirements.
CMEA mandates that DEA establish the total annual need for ephedrine,
pseudoephedrine, and phenylpropanolamine to be manufactured or imported each
calendar year to provide for the estimated medical, scientific, research, and
industrial needs of the United States, for lawful export requirements, and for
the establishment and maintenance of reserve stocks. These requirements apply
equally to products containing these three List I chemicals as they do to the
List I chemicals themselves. To limit the supply of the chemicals to the
amount needed to meet the national need, CMEA requires DEA to establish import
and production quotas for all three chemicals. DEA published its proposed 2007
assessment of annual needs for ephedrine, pseudoephedrine, and
phenylpropanolamine on October 19, 2006 (71 FR 61801). DEA published
regulations implementing procedures for import and production quotas on July
10, 2007 (72 FR 37439).
To obtain the information needed to assess the national need and set quotas
to limit imports and production to meet that need, DEA identified two
inadequacies regarding its existing regulations. First, persons who
manufacture or import prescription drugs containing the chemicals are not
registered. In another rulemaking, "Registration Requirements for List I
Chemicals'' [Docket No. DEA-294, RIN 1117- AB09], DEA is revising its
registration requirements to cover
[[Page 65251]]
manufacturers and importers of prescription drugs containing these
chemicals and will issue quotas to them although the distribution and export
of prescription drugs containing the chemicals will continue to be exempt from
DEA regulatory control.
The second inadequacy involves the thresholds that apply to pseudoephedrine
and phenylpropanolamine. To determine the annual need and set quotas, DEA must
obtain information on all imports and production involving the chemicals, not
just those that exceed the existing thresholds. The existing thresholds,
although relatively low, would allow a considerable market in the chemicals to
continue unregulated. For example, under the current 1 kilogram (2.2 pound)
threshold for pseudoephedrine, a person could import or distribute more than 2
pounds a month, or approximately 25 pounds a year, of pseudoephedrine without
exceeding the threshold and triggering DEA's controls. Assuming a low 50
percent conversion rate of pseudoephedrine to methamphetamine, a person could
annually manufacture approximately 12.5 pounds of methamphetamine with that
total sum of sub-threshold quantities. DEA analysis for 2006 estimates that
the national range in the street price for one pound of methamphetamine
(powder) is between $2,500 and $48,000. To further implement the Combat
Methamphetamine Epidemic Act of 2005, this rule seeks to curb the availability
of pseudoephedrine at the wholesale level for illicit purposes.
Additionally, under the current 2.5 kilogram (5.5 pound) threshold for
phenylpropanolamine, a person could import or distribute more than 5 pounds a
month, or approximately 66 pounds a year of phenylpropanolamine without
exceeding the threshold and triggering DEA's controls. Assuming a low 50
percent conversion rate of phenylpropanolamine to amphetamine, a person could
annually manufacture approximately 33 pounds of amphetamine with that total
sum of sub- threshold quantities. The resulting amphetamine would have street
value comparable to methamphetamine. To further implement the Combat
Methamphetamine Epidemic Act of 2005, this rule seeks to curb the availability
of phenylpropanolamine at the wholesale level for illicit purposes.
Currently, DEA is notified of all imports and exports of these chemicals
which exceed the established thresholds or for which no threshold is
established. DEA does not, however, receive import and export notifications
for imports and exports of listed chemicals less than established thresholds.
If DEA does not eliminate the threshold for imports and exports of
pseudoephedrine and phenylpropanolamine, DEA will not have complete and
accurate information regarding the quantities of these chemicals imported
into, and exported from, the United States. Further, manufacturers and
distributors are not required to maintain records of distributions of listed
chemicals at or below established thresholds. Without the maintenance of these
records, DEA will not have complete and accurate information regarding the
quantities of these chemicals being distributed domestically.
To establish the controls that Congress mandated and limit imports and
production to that needed for legitimate uses, DEA is proposing to eliminate
the thresholds for all transactions involving the List I chemicals
pseudoephedrine and phenylpropanolamine. As discussed previously, no threshold
currently exists for transactions involving the List I chemical ephedrine;
thus, all transactions are regulated. Any registrant manufacturing,
distributing, importing, or exporting pseudoephedrine or phenylpropanolamine,
in any quantity, either as bulk chemicals or in over-the-counter drug
products, would be subject to the reporting and recordkeeping requirements.
Any manufacturer or importer of prescription drug products containing one of
the chemicals would also be subject to reporting and recordkeeping
requirements. Importation of the chemicals is allowed only if it is within an
import quota that the importer has applied for and been granted by DEA. The
one exception to the import limits provided in CMEA is that an individual may
import not more than 7.5 grams in any 30-day period of a scheduled listed
chemical product (i.e., a product containing ephedrine, pseudoephedrine, or
phenylpropanolamine which may be marketed or distributed lawfully in the
United States under the Federal Food, Drug, and Cosmetic Act as a
nonprescription drug) by means of the U.S. Postal Service or a private or
commercial carrier (21
U.S.C. 844(a)).
The distribution and export of prescription drug products containing the
chemicals are not covered because DEA will be able to obtain the information
it needs for the assessment of annual national needs from importers and
manufacturers of these products. DEA has not determined that prescription drug
products are being diverted.
Regulated Transactions
The definition of "regulated transaction'' as amended by CMEA (21 U.S.C.
802(39)(A)(iv)) excludes:
(iv) Any transaction in a listed chemical that is contained in a drug that
may be marketed or distributed lawfully in the United States under the Federal
Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.), subject to clause (v),
unless--
(I) The Attorney General has determined under section 204 of the Act (21
U.S.C. 814) that the drug or group of drugs is being diverted to obtain the
listed chemical for use in the illicit production of a controlled substance;
and
(II) The quantity of the listed chemical contained in the drug included in
the transaction or multiple transactions equals or exceeds the threshold
established for that chemical by the Attorney General. Section 814 (b) states
that: In removing a drug or group of drugs from exemption * * * the Attorney
General shall consider, with respect to a drug or group of drugs that is
proposed to be removed from exemption--
(1) The scope, duration, and significance of the diversion;
(2) Whether the drug or group of drugs is formulated in such a way that it
cannot be easily used in the illicit production of a controlled substance; and
(3) Whether the listed chemical can be readily recovered from the drug or
group of drugs.
DEA in this rule is clarifying that nonprescription ("over-the- counter'')
drug products containing ephedrine, pseudoephedrine, and phenylpropanolamine
do not qualify for the exemption from the definition of "regulated
transaction'' based on the three factors listed in 21 U.S.C. 814(b).
Evaluation of Statutory Factors for Removal of Exemption From the
Definition of "Regulated Transaction''
Factor 1: Scope, Duration, and Significance of Diversion
Throughout the late 1970s, methamphetamine was illicitly produced primarily
through the use of the precursor phenylacetone ( phenyl-2- propanone (P2P)) by
outlaw motorcycle gangs in the United States. In response to the use of P2P,
DEA controlled P2P as a schedule II controlled substance in 1980, under the
immediate precursor provisions of the CSA, specifically 21
U.S.C. 811(e).
Clandestine laboratory operators responded by developing a variety of
synthetic methods for producing P2P and also migrated to the use of ephedrine
as precursor material.
Trafficking groups widely used a procedure for converting ephedrine to
methamphetamine that employed hydriodic acid and red phosphorus (HI/ Red P).
Use of the HI/Red P technique
[[Page 65252]]
(also known as a "hydriodic acid reduction'' or "ephedrine reduction'')
exploded across the western and southwestern United States through the 1980s,
and by 1990 accounted for 90 percent of all clandestine laboratory seizures
reported to DEA.
With the rapid increase in the use of the HI/Red P technique through the
1980s came increased law enforcement pressure. Purchases of bulk ephedrine
were loosely monitored, and legitimate domestic suppliers of ephedrine began
restricting or denying sales of bulk ephedrine to questionable buyers. In
response, clandestine manufacturers turned to foreign suppliers, and thefts
and diversion of bulk shipments of ephedrine also began to increase across the
United States.
In 1989, DEA control of chemicals was initiated with passage of the
Chemical Diversion and Trafficking Act of 1988 (CDTA) (Subtitle A of Title VI
of Pub. L. 100-690). This law placed recordkeeping and reporting requirements
on a wide variety of precursors and essential chemicals used in every aspect
of clandestine drug manufacture, including bulk powder ephedrine,
pseudoephedrine, and phenylpropanolamine. In response to the regulations,
traffickers moved to the illicit use of single-entity ephedrine OTC tablets as
an unregulated source of precursor material for the production of
methamphetamine.
The extraction of the precursor chemical ephedrine from OTC tablets was an
easy task. The tablets were simply ground using a kitchen blender and
ephedrine extracted with an appropriate solvent. Upon filtration and
evaporation of the solution, the traffickers were able to isolate the
ephedrine bulk powder. Traffickers began widely exploiting what became known
as the "tablet loophole.''
Soon after, DEA began encountering "ephedrine extraction laboratories''
whose primary purpose was to recover ephedrine from OTC tablets and capsules,
either for resale on the black market or for use in associated clandestine
methamphetamine laboratories. Many laboratories combined ephedrine extraction
and methamphetamine production.
Over the next three years, a number of well-publicized seizures of rogue
businesses (and prosecutions of their owners) began to impact the tablet
manufacturing industry, and the loophole allowing the sale of single-entity
ephedrine products was closed in late 1993 with the passage of the Domestic
Chemical Diversion Control Act of 1993 (DCDCA) (Pub. L. 103-200).
In efforts to circumvent the provisions of the DCDCA, OTC tablet
manufacturers began marketing new ephedrine combination products (i.e.,
ephedrine/guaifenesin tablets), which were exempt from DCDCA controls. The
most dramatic shift forced by the CDTA and DCDCA, however, was a rapid
transition from ephedrine to pseudoephedrine as the primary precursor for
illicit methamphetamine manufacture. Although bulk pseudoephedrine was
formally controlled under the CDTA in 1989, OTC products containing
pseudoephedrine remained exempt under both the CDTA and DCDCA. In contrast to
ephedrine, pseudoephedrine was present in a wide variety of pharmaceutical
products, including hundreds of OTC cold and allergy preparations, and formal
monitoring and control was considered (at that time) to be problematic. OTC
pseudoephedrine- containing products, therefore, represented an easy precursor
source for clandestine laboratory operators. By the mid-1990s, illicit
methamphetamine laboratories using pseudoephedrine surpassed those still using
ephedrine.
In 1996, the existing controls on precursor and essential chemicals imposed
by the CDTA and DCDCA were further tightened with the passage of the
Comprehensive Methamphetamine Control Act of 1996 (MCA) (Pub. L. 104-237).
What followed was a series of legislative actions on both the Federal and
State levels to tighten controls on pharmaceutical products that serve as
precursor material for clandestine methamphetamine laboratories. At the
federal level, this effort included passage of the Methamphetamine
Anti-Proliferation Act of 2000 (MAPA) (Title XXXVI of Pub. L. 106-310). Today,
however, ephedrine and pseudoephedrine OTC products continue to serve as the
primary precursor source for the illicit production of methamphetamine, which
has spread across the entire United States in epidemic proportions.
Current Seizures
Methamphetamine remains the primary drug produced in illicit laboratories
within the United States. Data from the El Paso Intelligence Center's (EPIC)
Clandestine Laboratory Database indicates that more than 10,010
methamphetamine laboratories were seized in calendar year 2004 and 5,883
laboratories in calendar year 2005 (as reported to EPIC through 05/08/07).
According to EPIC, from January 2000 through December 2006, there were 7,087
laboratories reportedly using ephedrine and 46,290 reportedly using
pseudoephedrine as precursor material for methamphetamine production.
Additionally EPIC reports the seizure of 52 amphetamine laboratories (using
phenylpropanolamine) during the same period. The vast majority of these
laboratories used pharmaceutical products containing pseudoephedrine,
ephedrine, and phenylpropanolamine as the source of precursor material.
Illicit Uses
Factor 2: whether the drug or group of drugs is formulated in such a way
that it cannot be easily used in the illicit production of a controlled
substance.
Factor 3: whether the listed chemical can be readily recovered from the
drug or group of drugs.
The production of methamphetamine from ephedrine or pseudoephedrine can be
accomplished via a series of reactions using widely available "recipes'' and
can be accomplished with little or no chemistry expertise. A variety of
different methods exist to convert the precursor material to methamphetamine.
If very small batches are made, there is not even a requirement to heat the
reactants. For example, quantities of ephedrine or pseudoephedrine, iodine,
and red phosphorous can be reacted with the addition of water and small
quantities of methamphetamine can be produced. For larger batches the
reactants are combined and heated for several hours. A variety of different
reagents can be used to make the conversion to methamphetamine if the
precursors ephedrine and pseudoephedrine are obtained. These reactants can
also be used to convert phenylpropanolamine to amphetamine. Manufacturing
procedures are readily available on the Internet and even unskilled persons
can obtain a 50-70 percent yield of methamphetamine or amphetamine.
Note: Pseudoephedrine and ephedrine can also serve as precursor material
for the manufacture of the schedule I controlled substance methcathinone. From
January 2000 through December 2006, there were 165 methcathinone laboratory
seizures reported to EPIC.
There is a common misconception in industry and among some in the public
that OTC drug products, particularly pseudoephedrine or ephedrine products in
combination with other medically active ingredients (combo products), are
somehow less likely to be diverted or are less desirable among clandestine
laboratory cooks for the manufacture of methamphetamine. This is not the case.
Most of the clandestine laboratories found in the United States are using
tablets, either single-entity or
[[Page 65253]]
combination. In many of the methamphetamine exhibits analyzed by DEA
analytical laboratories, the presence of antihistamines is detected,
indicating that combination products were used in the reactions.
While the vast majority of clandestine laboratories seized have used
tableted pseudoephedrine and ephedrine products, gel caps and liquid dosage
form products can easily serve as the source of precursor material for the
production of methamphetamine. DEA scientific studies show that liquid, gel
cap, and combination products are easily used as the source of precursor
material and the pseudoephedrine/ephedrine from these products can be easily
extracted with appropriate reagents/ solvents. These reagents/solvents are all
readily available at hardware and auto parts stores in the United States.
The controlled substances produced from these chemicals, methamphetamine
and amphetamine, have a high abuse potential. The public health consequences
of the manufacture, trafficking, and abuse of these two substances are well
known and documented.
Findings
Therefore, based on the above discussion, the Administrator of the Drug
Enforcement Administration, pursuant to the authority delegated by the
Attorney General, finds, pursuant to the criteria specified in 21 U.S.C.
814(b), that drug products containing the List I chemicals ephedrine,
pseudoephedrine, and phenylpropanolamine are being diverted for the illicit
production of controlled substances, namely methamphetamine and amphetamine.
As DEA has discussed, these products have a demonstrated history over the past
20 years of diversion for illicit purposes. These List I chemicals are
diverted regardless of formulation--liquid, nonliquid, gel capsule--and
regardless of dosage strength. Accordingly, the Administrator of the Drug
Enforcement Administration, pursuant to the authority delegated by the
Attorney General, removes drug products containing the List I chemicals
ephedrine, pseudoephedrine, and phenylpropanolamine from exemption from the
definition of "regulated transaction'' under 21 U.S.C.
802(39)(a)(iv). As
such, unless otherwise exempted, such materials would be subject to the
chemical regulatory control provisions of the CSA. DEA is proposing to add a
new section 1310.14 removing these drugs from the exemption.
The CSA has specifically exempted retail transactions involving scheduled
listed chemical products from the definition of regulated transaction (21
U.S.C. 802(39)(a)(v)) and established a separate set of regulations that
control those retail transactions (71 FR 56008, September 26, 2006; corrected
at 71 FR 60609, October 13, 2006).
Technical Correction
While drafting this rulemaking, DEA became aware of an inaccurate citation
in 21 CFR
1310.10, the section paralleling the criteria to be considered in
evaluating the statutory factors for removal of exemption from the definition
of "regulated transaction'' at 21 U.S.C. 814 and discussed above.
Specifically, the definition of "regulated transaction'' cited in 21 CFR
1310.10 is inaccurate. Therefore, to alleviate any confusion, DEA is proposing
to correct this citation.
Regulatory Certifications
Regulatory Flexibility Act
The Deputy Administrator hereby certifies that this rulemaking has been
drafted in accordance with the provisions of the Regulatory Flexibility Act (RFA)
(5 U.S.C. 601-612). Without this rule, DEA will not be able to effectively
implement the quota and import provisions of CMEA.
As DEA has demonstrated throughout this document, traffickers and others in
search of the chemicals necessary for clandestine manufacture of
methamphetamine and amphetamine, are actively looking to exploit any loophole
in chemical controls.
As discussed above, the current thresholds create a loophole that could be
exploited by traffickers who can turn below-existing-threshold quantities of
List I chemicals into valuable, sought-after quantities of methamphetamine
and/or amphetamine. The diversion of below-threshold quantities of these
precursor chemicals could result in the illicit production of significant
quantities of methamphetamine and/or amphetamine. CMEA was enacted to prevent
this illicit production. Congress specifically imposed a 3.6 gram daily sales
limit, and a 9 gram 30-day purchase limit for all transactions involving
scheduled listed chemical products, as well as a 7.5 gram 30-day sales limit
for sales of scheduled listed chemical products made by mobile retail vendors
and mail order distributors. Congress, through the CMEA, also limited the
quantity of scheduled listed chemical products an individual may import into
the United States to not more than 7.5 grams during a 30-day period by means
of shipping through any private or commercial carrier or the Postal Service.
Congress further limited importation of ephedrine, pseudoephedrine, and
phenylpropanolamine, prohibiting all imports except "such quantities * * * as
the Attorney General finds to be necessary to provide for medical, scientific,
or other legitimate purposes,'' (21 U.S.C.
952(a)(1)). It is inconsistent with
Congressional intent to limit retail sales and purchases, and importation, of
scheduled listed chemical products while allowing producers and traffickers to
import or purchase from distributors quantities 100 times greater than retail
sales limits without subjecting those transactions to any controls.
As noted previously, below-threshold transactions are not documented to DEA;
thus, DEA has no knowledge of the movement, including importation and
exportation, of below-threshold quantities of pseudoephedrine and
phenylpropanolamine. Specifically, non-retail distribution, import, and export
transactions involving less than 1 kilogram of pseudoephedrine (approximately
2.2 pounds), or less than 2.5 kilograms of phenylpropanolamine (approximately
5.5 pounds), per month per customer would be exempt from DEA recordkeeping and
reporting requirements. DEA cannot monitor, and does not receive reports on,
these import, export, and distribution transactions. As discussed previously,
the diversion of below-threshold quantities of these precursor chemicals could
result in the illicit production of significant quantities of methamphetamine
and/or amphetamine.
Not removing the thresholds would also create a loophole in the system of
import and production quotas established by the CMEA and implemented in an
Interim Final Rule with Request for Comment (72 FR 37439, July 10, 2007).
Without the reporting of all such transactions involving ephedrine,
pseudoephedrine, and phenylpropanolamine to DEA, it would be more difficult
for DEA to establish an assessment of annual national needs and to administer
individual quotas for these List I chemicals. DEA would have incomplete
information regarding these chemicals on which to base its assessments and
quotas.
Finally, this rule seeks to clarify that ephedrine, pseudoephedrine, and
phenylpropanolamine have been, and continue to be, diverted for the illicit
manufacture of controlled substances. By making this statement, this document
hereby would formally
[[Page 65254]]
include ephedrine, pseudoephedrine, and phenylpropanolamine, and drug
products containing ephedrine, pseudoephedrine, and phenylpropanolamine,
within the scope of the definition of "regulated transaction'' found at 21
U.S.C. 802(39). This rule is necessary to avoid possible confusion in
interpreting and applying the CMEA definition of "regulated transaction.''
DEA notes that the effect of eliminating the thresholds will impose a
minimal burden on regulated entities. Although it is likely that many of the
registrants who handle the two chemicals are small businesses under the Small
Business Administration definition of small entities, the changes impose
virtually no burden on these entities for three reasons. First, most, if not
all, legitimate transactions at the import, export, manufacturing, and
distribution level are in excess of the previous thresholds. DEA does not
expect any new registrations to result from the change. Second, although it is
possible that some registrants may have some transactions that will be newly
regulated, the recordkeeping for these can be met with standard business
records. The only information required in records for regulated transactions
is the name and address of the seller and purchaser (plus their DEA
registration numbers, if applicable); the date of the transaction; the name,
quantity, and form of packaging of the listed chemical; the method of
transfer; and the method of identification used by the customer and any unique
identification number associated with the identification. This information is
normally included on purchase orders or invoices and the shipping papers and
is needed to complete and track the transaction. As long as the purchaser can
extract the records for examination, if necessary, no additional effort is
needed. Because almost all business records for manufacturers, importers, and
distributors are now generated and transmitted electronically, DEA does not
expect that any registrant will need additional recordkeeping.
Third, if any person is importing or exporting in very small quantities,
there may be some additional import/export declarations required, but these
forms require less than half an hour to complete and file. The only other
requirement would be to report suspicious small transactions. These reports
also require less than a half hour to complete and file.
As noted above, DEA does not believe that legitimate importers or exporters
are handling such small quantities. The purpose of this rule is to close a
loophole that could be exploited by those seeking the chemicals for illicit
purposes and to ensure that DEA can accurately assess the legitimate need. DEA,
therefore, certifies that the rule will not have a significant economic impact
on a substantial number of small entities.
Executive Order 12866
The Deputy Administrator further certifies that this rulemaking has been
drafted in accordance with the principles in Executive Order 12866 section
1(b). It has been determined that this is "a significant regulatory action.''
Therefore, this action has been reviewed by the Office of Management and
Budget. This rule supports implementation of provisions of the CMEA. The CMEA
is expansive in its breadth, essentially reclassifying ephedrine,
pseudoephedrine, and phenylpropanolamine as scheduled listed chemicals,
imposes new retail restrictions on these products, and mandates new domestic
and import quotas. Without this rule, traffickers could exploit
below-threshold transactions, which are not reported to DEA and for which
records are not required to be maintained, to divert valuable quantities of
pseudoephedrine and phenylpropanolamine for the clandestine manufacture of
methamphetamine and/or amphetamine. Further, without this rule, DEA would not
have complete information on which to base its assessment of the annual
national needs for the List I chemicals ephedrine, pseudoephedrine, and
phenylpropanolamine as DEA does not receive information regarding
below-threshold transactions. This lack of information would create a loophole
in the quota system, and would prevent DEA from fulfilling its legislative
mandate that imports of pseudoephedrine and phenylpropanolamine be prohibited
except for medical, scientific, or other legitimate purposes. Without this
rule, DEA will not be able to effectively and fully implement the quota and
import provisions of the CMEA.
As discussed above, DEA does not anticipate that this change will impose
more than the minimal costs that would be associated with reporting small
transactions that the registrant thought suspicious and possibly filing forms
for import and export notifications. The benefits of the rule are those
associated with controlling access to chemicals used to manufacture
methamphetamine, and other controlled substances, illicitly. As has been
discussed extensively throughout this document, traffickers and others are
actively looking to exploit any loophole in chemical controls to continue
their operations. As noted previously, the current thresholds could permit a
person to divert approximately 25 pounds of pseudoephedrine and 66 pounds of
phenylpropanolamine annually, without exceeding existing thresholds. This rule
closes a loophole that could result in the undocumented diversion of these
chemicals for illicit production of significant quantities of methamphetamine
and/or amphetamine. As noted previously in this rule, below-threshold
transactions are not documented to DEA; the diversion of below-threshold
quantities of these precursor chemicals could result in the illicit production
of significant quantities of methamphetamine and/or amphetamine.
Executive Order 12988
This regulation meets the applicable standards set forth in sections 3(a)
and 3(b)(2) of Executive Order 12988 Civil Justice Reform.
Executive Order 13132
This rulemaking does not impose enforcement responsibilities on any state;
nor does it diminish the power of any state to enforce its own laws.
Accordingly, this rulemaking does not have federalism implications warranting
the application of Executive Order 13132.
Unfunded Mandates Reform Act of 1995
This rule will not result in the expenditure by state, local, and tribal
governments, in the aggregate, or by the private sector, of $120,000,000 or
more (adjusted for inflation) in any one year, and will not significantly or
uniquely affect small governments. Therefore, no actions were deemed necessary
under the provisions of the Unfunded Mandates Reform Act of 1995.
Congressional Review Act
This rule is not a major rule as defined by section 804 of the Small
Business Regulatory Enforcement Fairness Act of 1996 (Congressional Review
Act). This rule will not result in an annual effect on the economy of
$100,000,000 or more; a major increase in costs or prices; or significant
adverse effects on competition, employment, investment, productivity,
innovation, or on the ability of United States-based companies to compete with
foreign-based companies in domestic and export markets.
[[Page 65255]]
Paperwork Reduction Act
This rule would require that records be maintained regarding distributions
of the List I chemicals pseudoephedrine and phenylpropanolamine. These records
are maintained as a normal course of business.
The rule also proposes to reduce the thresholds for the List I chemicals
pseudoephedrine and phenylpropanolamine from 1 kilogram and 2.5 kilograms,
respectively, to zero, thereby requiring that DEA receive advance notification
of all importations and exportations of these List I chemicals. DEA notes that
it already receives some Import/ Export Declarations if the cumulative amount
of the transactions exceeds the thresholds on a monthly basis. Therefore, DEA
does not believe that this change will significantly increase the burden
associated with this information collection. Specifically, DEA estimates that
53 additional export notifications and 53 additional export return
declarations will be received annually. Further, DEA estimates that 50
additional import declarations and 55 additional import return declarations
will be received annually. DEA assumes 10 percent of all imports will not be
transferred in the first 30 days and will necessitate submission of a
subsequent return declaration. The receipt of these additional forms increases
the hour burden by 34 hours annually. Therefore, DEA is revising its existing
information collection [OMB approval number 1117-0023 "Import/Export
Declaration for List I and List II Chemicals'', DEA Form 486] to reflect the
increased burden associated with receipt of these import/export declarations.
The Department of Justice, Drug Enforcement Administration, has submitted
the following information collection request to the Office of Management and
Budget for review and clearance in accordance with review procedures of the
Paperwork Reduction Act of 1995. The proposed information collections are
published to obtain comments from the public and affected agencies. All
comments and suggestions, or questions regarding additional information, to
include obtaining a copy of the information collection instrument with
instructions, should be directed to Mark W. Caverly, Chief, Liaison and Policy
Section, Office of Diversion Control, Drug Enforcement Administration,
Washington, DC 20537.
Written comments and suggestions from the public and affected agencies
concerning the collection of information are encouraged. Your comments on the
information collection-related aspects of this rule should address one or more
of the following four points:
(1) Evaluate whether the proposed collection of information is necessary
for the proper performance of the functions of the agency, including whether
the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of the burden of the
proposed collection of information, including the validity of the methodology
and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be
collected; and
(4) Minimize the burden of the collection of information on those who are
to respond, including through the use of appropriate automated, electronic,
mechanical, or other technological collection techniques or other forms of
information technology, e.g., permitting electronic submission of responses.
Overview of Information Collection 1117-0023
(1) Type of Information Collection: Revision of a Currently Approved
Collection.
(2) Title of the Form/Collection: Import/Export Declaration for List I and
List II Chemicals.
(3) Agency form number, if any, and the applicable component of the
Department sponsoring the collection: Form number: DEA Form 486. Component:
Office of Diversion Control, Drug Enforcement Administration, U.S. Department
of Justice.
(4) Affected public who will be asked or required to respond, as well as a
brief Abstract: Primary: Business or other for-profit. Other: None. Abstract:
Persons importing, exporting, and conducting international transactions with
List I and List II chemicals must notify DEA of those transactions in advance
of their occurrence, including information regarding the person(s) to whom the
chemical will be transferred and the quantity to be transferred. Persons must
also provide return declarations, confirming the date of the importation,
exportation, or international transaction and transfer, and the amounts of the
chemical transferred. This information is used to prevent shipments not
intended for legitimate purposes.
(5) An estimate of the total number of respondents and the amount of time
estimated for an average respondent to respond: A respondent may submit
multiple responses. The below table presents information regarding the number
of respondents, responses, and associated burden hours.
|
Number of respondents
|
Number of responses
|
Average time per response
|
Total (hours)
|
Form 486 (export)
|
239
|
8,050
|
0.2 hour
(12 minutes)
|
1,610
|
Form 486 (Export Return Declaration)
|
239
|
8,050
|
0.08 hour
(5 minutes)
|
670.9
|
Form 486 (import)
|
230
|
2,450
|
0.25 hour
(15 minutes)
|
612.5
|
Form 486 (import return declaration) *
|
230
|
2,695
|
0.08 hour
(5 minutes)
|
224.6
|
Form 486 (international transaction)
|
9
|
111
|
0.2 hour
(12 minutes)
|
22.2
|
Form 486 (international transaction return declaration)
|
9
|
111
|
0.08 hour
(5 minutes)
|
9.25
|
Quarterly reports for imports of acetone, 2-butanone, and
toluene
|
110
|
440
|
0.5 hour
(30 minutes)
|
220
|
Total
|
239
|
|
|
3,369.45
|
* DEA assumes 10 percent of all imports will not be transferred in the
first 30 days and will necessitate submission of a subsequent return
declaration.
(6) An estimate of the total public burden (in hours) associated with the
collection: 3,370 annual burden hours.
If additional information is required contact: Lynn Bryant, Department
Clearance Officer, United States Department of Justice, Justice Management
Division, Policy and Planning Staff, Patrick Henry Building, Suite 1600, 601 D
Street, NW., Washington, DC 20530.
[[Page 65256]]
List of Subjects in 21 CFR Part 1310
Drug traffic control, Exports, Imports, Reporting and recordkeeping
requirements. For the reasons set forth above, 21 CFR part 1310 is proposed to
be amended as follows:
PART 1310--RECORDS AND REPORTS OF LISTED CHEMICALS AND CERTAIN MACHINES
[AMENDED]
1. The authority citation for part 1310 continues to read as follows:
Authority: 21
U.S.C. 802, 827(h),
830, 871(b),
890.
2. Section 1310.04 is amended by revising paragraphs (f)(1)(i) table and
(ii), (g)(1)(i) through (vii), and adding paragraphs (g)(1)(viii) and (ix)
to read as follows:
Sec. 1310.04 Maintenance of records.
* * * * *
(f) * * *
(1) * * *
(i) * * *
Code
|
Chemical
|
Threshold by base weight
|
8522
|
N-Acetylanthranilic acid, its esters, and its salts
|
40 kilograms
|
8530
|
Anthranilic acid, its esters, and its salts
|
30 kilograms
|
8256
|
Benzaldehyde
|
4 kilograms
|
8735
|
Benzyl cyanide
|
1 kilogram
|
8675
|
Ergonovine and its salts
|
10 grams
|
8676
|
Ergotamine and its salts
|
20 grams
|
8678
|
Ethylamine and its salts
|
1 kilogram
|
6695
|
Hydriodic acid
|
1.7 kilograms
(or 1 liter by volume) |
8704
|
Isosafrole
|
4 kilograms
|
8520
|
Methylamine and its salts
|
1 kilogram
|
8502
|
3, 4-Methylenedioxyphenyl-2-propanone
|
4 kilograms
|
8115
|
N-Methylephedrine, its salts, optical isomers, and salts
of optical isomers
|
1 kilogram
|
8119
|
N-Methylpseudoephedrine, its salts, optical isomers, and
salts of optical isomers
|
1 kilogram
|
6724
|
Nitroethane
|
2.5 kilograms |
8317
|
Norpseudoephedrine, its salts, optical isomers, and salts
of optical isomers
|
2.5 kilograms |
8791
|
Phenylacetic acid, its esters, and its salts
|
1 kilogram
|
2704
|
Piperidine and its salts
|
500 grams
|
8750
|
Piperonal (also called heliotropine)
|
4 kilograms
|
8328
|
Propionic anhydride
|
1 gram
|
8323
|
Safrole
|
4 kilograms
|
(ii) For List I chemicals that are contained in scheduled listed chemical
products as defined in Sec.
1300.02(b)(34)(i), the thresholds established in
paragraph (g) of this section apply only to non-retail distribution, import,
and export. Sales of these products at retail are subject to the requirements
of Part 1314 of this chapter.
* * * * *
(g) * * *
(1) * * *
(i) Ephedrine, its salts, optical isomers, and salts of optical isomers
(ii) Gamma-Butyrolactone (Other names include: GBL; Dihydro-2(3H)-
furanone; 1,2-Butanolide; 1,4-Butanolide; 4-Hydroxybutanoic acid lactone;
gamma-hydroxybutyric acid lactone)
(iii) Hypophosphorous acid and its salts (including ammonium
hypophosphite, calcium hypophosphite, iron hypophosphite, potassium
hypophosphite, manganese hypophosphite, magnesium hypophosphite, and sodium
hypophosphite)
(iv) Iodine
(v) N-phenethyl-4-piperidone (NPP)
(vi) Pseudoephedrine, its salts, optical isomers, and salts of optical
isomers
(vii) Phenylpropanolamine, its salts, optical isomers, and salts of
optical isomers
(viii) Red phosphorus
(ix) White phosphorus (Other names: Yellow Phosphorus)
* * * * *
3. Section 1310.10 is amended by revising paragraph (a) introductory text
to read as follows:
Sec. 1310.10 Removal of the exemption of drugs distributed under the
Food, Drug and Cosmetic Act.
(a) The Administrator may remove from exemption under section
1300.02(b)(28)(i)(D) any drug or group of drugs that the Administrator finds
is being diverted to obtain a listed chemical for use in the illicit
production of a controlled substance. In removing a drug or group of drugs
from the exemption the Administrator shall consider:
* * * * *
4. Section 1310.14 is added to read as follows:
Sec. 1310.14 Removal of exemption from definition of regulated
transaction.
The Administrator finds that the following drugs or groups of drugs are
being diverted to obtain a listed chemical for use in the illicit production
of a controlled substance and removes the drugs or groups of drugs from
exemption under Sec. 1300.02(b)(28)(i)(D) of this chapter pursuant to the
criteria listed in Sec. 1310.10 of this part:
(a) Nonprescription drugs containing ephedrine, its salts, optical
isomers, and salts of optical isomers.
(b) Nonprescription drugs containing pseudoephedrine, its salts, optical
isomers, and salts of optical isomers.
(c) Nonprescription drugs containing phenylpropanolamine, its salts,
optical isomers, and salts of optical isomers.
Dated: November 7, 2007.
Michele M. Leonhart,
Deputy Administrator.
[FR Doc. E7-22560 Filed 11-19-07; 8:45 am]
BILLING CODE 4410-09-P
NOTICE: This is an
unofficial version. An official version of these publications may be obtained
directly from the Government Printing Office (GPO).
|