What FSMA Really Tells Us about the Focus of Food Safety
By Sonali Gunawardhana and James N. Czaban
The passage of the Food Safety Modernization Act (FSMA) marked a historic revolution in U.S. food safety laws. Both the law, and the U.S. Food and Drug Administration’s (FDA) recently published proposed regulations, make very clear that the focus of food safety will shift away from federal regulators responding to unpredictable incidences of contamination to a system whereby both domestic and international food producers are required to take specific proactive steps and assume primary responsibility for producing safe food. FDA’s Deputy Commissioner for Foods Michael R. Taylor recently outlined FDA’s strategy to implement FSMA as follows:
Stated in the simplest terms, the recognized solution to the problem of foodborne illness is a comprehensive prevention strategy that involves all participants in the food system, domestic and foreign, doing their part to minimize the likelihood of harmful contamination. And that is the strategy mandated by FSMA. It is not a strategy that assumes we can achieve a zero-risk food supply, but it is a strategy grounded in the conviction that we can better protect consumers and the economic vigor of the food system if everyone involved implements reasonably available measures to reduce risk.
The FSMA strategy recognizes that the food industry has the primary responsibility and capacity to produce safe food, but it calls for a new definition of public and private roles on food safety and a modern new framework for regulatory oversight, integration of government food safety efforts, and public-private collaboration.
FSMA requires FDA to implement many rules and regulations on various effective dates and implementation schedules. FDA’s initial implementation of rules governing expanded records access, reinspection and recall fees, as well as food facility registration guidelines, has now given food manufacturers their first taste of the potentially costly and burdensome new FDA food safety scheme.
We address below the key provisions of FSMA, FDA’s initial interpretations and implementation strategies for those provisions and how they differ from prior requirements under the federal Food, Drug & Cosmetic Act (FD&C), all with an eye toward practical recommendations for food manufacturers and growers.
Growing Underlying Cost — Expanded Record Access
Because the records-access provisions of FSMA became effective on passage, FDA issued an interim final rule in February 2012 that expands the agency’s records access authority well beyond what was accorded the agency prior to FSMA. Previously, FDA was allowed only limited access to company records related to specific articles of food that the agency reasonably believed to be adulterated and to present a threat of serious adverse health consequences or death to humans or animals. Now, under FSMA, FDA may demand access to company records relating to any article of food the agency believes is reasonably likely to be affected in a similar manner. FDA is using this expanded records access authority to impose ever more expansive record-keeping requirements as part of every other proposed FSMA regulation. Indeed, several new record-keeping requirements have already been unveiled in both the Produce Safety and Preventive Controls proposed rules, which are discussed more fully below.
Shifting the Regulatory Cost Burden to Industry — New Reinspection and Recall Fees
In August 2012, FDA announced domestic and foreign facility reinspection, as well as recall and importer reinspection fees, although FDA explicitly indicated that it would not issue invoices for reinspections or recalls until a guidance document is published, outlining a set of guidelines for small businesses. Currently, there is no fee for an initial FDA inspection; however, FSMA authorizes FDA to assess and collect fees related to certain domestic food facility, foreign food facility and importer reinspections. The fee for reinspection is to cover reinspection-related costs when an initial inspection has identified certain food safety problems. The rates for reinspection are $221 an hour per FDA field investigator if no foreign travel is required, and $289 an hour if foreign travel is required. FDA will not estimate the reinspection cost and simply states that it would be determined on a case-by-case basis. FDA also has the authority to assess and collect fees for food recall activities associated with a recall order when a domestic food facility or importer does not comply with such an order. Even though FDA has indicated that it will not issue fee invoices until the small business guidance is published, it has incorporated the following language in numerous warning letters dating back to April 2012, giving notice that it is only a matter of time before FDA begins collecting fees as authorized by FSMA.
Section 743 of the Act (21 U.S.C. § 379j-31) authorizes FDA to assess and collect fees to cover FDA’s costs for certain activities, including costs related to reinspection. A reinspection is one or more inspections conducted subsequent to an inspection that identified non-compliance materially related to a food safety requirement of the Act, specifically to determine whether compliance has been achieved. Reinspection-related costs means all expenses, including administrative expenses, incurred in connection with FDA’s arranging, conducting, and evaluating the results of the reinspection, and assessing and collecting the reinspection fees, 21 U.S.C. § 379j-31(a)(2)(B). For a domestic facility, FDA will assess and collect fees for reinspection-related costs from the responsible party for the domestic facility. The inspection noted in this letter identified non-compliance materially related to a food safety requirement of the Act. Accordingly, FDA may assess fees to cover any costs related to reinspection.
The Possible Hidden Costs — Facility Registration
In October 2012, FDA tackled another FSMA provision, regarding registration, by issuing an updated guidance document entitled “Necessity of the Use of Food Product Categories in Food Facility Registrations and Updates to Food Product Categories.” Under this guidance, a registrant must submit a registration to FDA containing information necessary to notify the agency of the general food category of any food manufactured, processed, packed or held at such facility. FDA also now has the power to suspend a food facility registration, which it recently did to Sunland Inc., based on the company’s massive peanut butter recall. FSMA does not require registered facilities to pay a registration fee; however, in its budget request for fiscal year 2013, FDA incorporated language for a Food Establishment Registration User Fee of approximately $500 per facility, which would generate approximately $220 million in fees. Because FDA does not have the authority to collect this fee, Congress would need to approve the request and grant FDA authority to collect the user fees.
FDA’s Interpretation of FSMA Unveiled
Unlike the FSMA provisions discussed above, other provisions are being rolled out more cautiously. On January 4, 2013, 2 years after FSMA was enacted, FDA proposed two comprehensive rules aimed at preventing the contamination of produce and processed foods. These proposed rules are the core of FSMA and represent a monumental change in the way FDA regulates food. Some of the significant changes outlined in these two proposed rules include requirements for companies to draft and comply with highly specific food safety plans; to adhere to much more extensive record keeping and to implement new safety measures, including, for example, requiring that farmworkers wash their hands, installing portable toilets in crop fields, as well as developing corrective action plans for handling outbreaks of foodborne illness. FSMA gives FDA broad new powers, including the authority to mandate that companies recall products as well as the ability to review internal records at farms and food production plants. For the first time, food processing companies would be required to design and document an exhaustive program of sanitary measures varying from pest control to what factory workers are allowed to wear while on duty.
The Preventive Controls proposed rule will implement Section 103 of FSMA, which requires food facilities to evaluate potential food safety hazards, identify and implement preventive controls, verify that the controls are adequate to control the hazards identified, take corrective action when needed and maintain a written food safety plan. The requirements outlined are similar to the Hazard Analysis and Critical Control Points (HACCP) systems currently in place for juice and seafood, in which facility operators are required to understand the hazards that are reasonably likely to occur and to establish controls to minimize and prevent the hazards.
This proposed rule applies to facilities that manufacture, process, pack or hold human food, which means this generally applies to facilities that are required to register with FDA under Section 415 of the FD&C. The proposed rule exempts certain facilities, but the rule explicitly states that FDA may withdraw certain exemptions if it determines it is necessary to protect the public health. This revocation provision will allow FDA to reassess its enforcement parameters. Facilities such as warehouses that only store packaged foods and that are not exposed to the environment would not be subject to the proposed rule, nor would other activities that are already governed by established HACCP regulations, such as those involving seafood, low-acid canned foods and juice. Dietary supplements would also be exempt, as they must comply with the current Good Manufacturing Practices for supplements.
Furthermore, each covered facility would be required to prepare and implement a written food safety plan by a qualified individual (someone who successfully completes training in accordance with a standard curriculum or is qualified by training and experience). Written plans must include a written Hazard Analysis that identifies and evaluates known or reasonably foreseeable hazards for each type of food manufactured, processed, packed or held at the facility. Each plan must also include preventive controls, including controls for process, food allergens and sanitation, and a recall plan should a hazard be discovered. In addition, facilities will be required to develop monitoring procedures to document and verify that the preventive controls are consistently performed and implemented. For FDA to verify during inspection that these activities have occurred, facilities also will be required to provide the agency with copies of their food safety plans, including the Hazard Analysis, as well as records of the preventive controls, monitoring, corrective actions and verification procedures.
While food producers would have some autonomy in how they comply, they are still required to adhere to all the provisions laid out in the proposed rule and, should they fail, enforcement action may include mandatory recall of the contaminated product or regulatory correspondence requesting swift corrective action.
The Produce Safety rule is based on Section 105 of FSMA, which directs FDA to set science-based standards that, if effectively implemented, should minimize the risk of serious adverse health consequences or death from contaminated produce. FDA defined “produce” in a somewhat peculiar way of which farmers and producers must be aware. Specifically, FDA deems “produce” to include fruits and vegetables grown for human consumption, such as spinach, cantaloupe, tomatoes, sprouts, mushrooms, strawberries and tree nuts, such as walnuts and almonds, just to name a few, but the rule also applies to mixes of intact fruits and vegetables, such as fruit baskets. Somewhat counterintuitively, however, “produce” does not apply to a long list of raw agricultural commodities that are rarely consumed raw, most notably potatoes, corn, squash, Brussels sprouts, asparagus, artichokes, beets and eggplant. Nor does “produce” include products produced for personal or on-farm consumption or products destined for commercial processing such as canning. The rationale for these exclusions is that the food items would be expected to be cooked or processed before consumption, thus reducing or eliminating microorganisms of public health concern.
Under the Produce rule, farmers now face making costly changes to how they conduct business. Potential changes may include building fences to keep out wildlife, waiting a certain period before harvesting crops where domestic animals have grazed to ensure that the crops aren’t contaminated by animal waste and ensuring and documenting that equipment and buildings are sanitized appropriately. In addition, farmers would have to ensure via periodic testing that all agricultural water used on their crops is safe and of adequate sanitary quality.
This rule, like the Preventive Controls rule, allows farmers to find alternative means of compliance; however, alternatives will only be considered acceptable if the alternative is scientifically established to provide the same amount of protection without increasing the risk of adulteration. The rule also allows a state or foreign country that imports products into the U.S. to request a modification from some or all of the provisions of the rule, but the request is not automatically granted. Rather, FDA will take into consideration whether granting the modification is necessary in light of local growing conditions, and whether the practices under the proposed modification provide the same level of public health protection without increasing the risk of adulteration.
Compliance & Cost Concern for Industry
The expected costs of complying with these new rules are a major concern for industry. FDA has estimated that the overall first-year cost to industry for the Preventive Controls rule will be $701 million, with an annualized cost of $472 million. FDA estimates the annualized cost of the Produce rule at $460 million for domestic farms and $170 million for foreign farms, for a grand total of $630 million annually. Many observers believe FDA has underestimated the costs by a significant degree and that many operations may be forced out of business by the costs and burdens imposed. Specific feedback from industry will be particularly important in helping shape the final versions of these rules.
The expected costs to FDA and the impact on the budget deficit are also major concerns. FSMA calls on FDA to increase inspections, particularly at “high-risk” facilities prone to contamination, and to hire about 2,000 new inspectors, of which the estimated cost for the government is $1.4 billion over the first 5 years. FDA will most likely request congressional authorization for user fees from food companies and farms to help pay for the increased oversight costs mandated by FSMA, increasing the costs further for an industry already facing looming compliance expenses associated with the new rules. It is not inconceivable that many of these costs will be passed on to consumers, driving the cost of food even higher and making it harder for American families to adjust.
Next Steps in the Rulemaking Process
FDA expects to be challenged on many of the new mandates outlined in these proposed rules given the staggering costs associated with implementation; therefore, it has scheduled and held a series of Public Meetings to receive feedback from food industry representatives and consumers. FDA initially stated in the proposed rules that it would consider written comments received by May 16, 2013. However, FDA received numerous requests for an extension to provide written comments given the complexity of these rules as well as the fact that they are highly intertwined with three other major rules (foreign supplier verification program, preventive controls designed to reduce the likelihood of contamination in animal food and certification of third-party audits) that have yet to be published. Based on these requests, the agency extended the comment period by another 120 days to give industry and consumers a chance to fully comment on the rules, so now the new date for filing written comments is September 16, 2013.
The final regulations may include changes requested by commenters and will likely have variable, effective compliance dates for different provisions and for different categories or sizes of businesses (small and very small businesses will likely have longer to come into compliance than larger companies). Given the impact FDA’s regulations will have on companies large and small, however, it is crucial for any and all affected companies to understand the proposed rules and to make their views, objections and constructive suggestions known to FDA as part of the rulemaking process.
The issuance of these proposed rules marks the start of what will be a lengthy and challenging rulemaking proceeding. There are many issues within the rules, and industry may want FDA to modify or relax its proposals around them. FDA may be flexible on some issues, but on others, the agency’s views will be difficult or impossible to change.
Sonali Gunawardhana is a member of Wiley Rein’s food and drug law practice group. She worked for nearly 10 years as an attorney at FDA and also served in FDA’s Center for Food Safety and Applied Nutrition. She can be reached at 202.719.7454 or [email protected].
James N. Czaban is a member of Wiley Rein’s food and drug law practice group. He has extensive experience in government regulation of food, pharmaceutical, biotechnology, medical device and healthcare-related companies. He can be reached at 202.719.7411 or [email protected].
1. Taylor, M.R. 2012. Progress on FSMA, Changes within the FDA Foods Program, and on Partnerships. FDA Science Writers Symposium, Silver Spring, MD.
2. FDA Warning Letter issued to Lucky Taco, April 2, 2012.