FDA’s preventive controls rule: hollowed out by OIRA, and less costly than the agency suggests

From frozen meals and spices to nutbutters and cheeses, processed foods have been responsible for an alarming number of outbreaks in recent years.

The FDA’s proposed rule on “preventive controls for human food” would require manufacturers, processors, and warehouses to design a written food safety plan tailored to each facility’s products and operations. (The rule would also apply to mixed-type facilities that conduct processing activities on a farm.) In general, facilities would have to identify the potential hazards in their processes and then implement controls to minimize or prevent them. This system—Hazard Analysis and Risk-Based Preventive Controls, or HARPC—is intended to address microbiological, chemical, physical, and radiological hazards in food processing, as well as undeclared allergens.

CPR Member Scholars Rena Steinzor, Lisa Heinzerling, Sidney Shapiro, Policy Analyst Michael Patoka and I submitted comments to the FDA, urging the agency to issue the final rule as soon as possible and to select the options that are most protective of public health.

FDA Must Restore the Essential Provisions Eliminated by OIRA

During the 13 months the rule spent under review at the White House, the Office of Information and Regulatory Affairs (OIRA) eliminated a number of crucial provisions that the FDA had originally proposed, including requirements for:

(1)    Certain sanitation practices;

(2)    Food-safety training for employees;

(3)    Review of consumer complaints;

(4)    Environmental monitoring for pathogens (testing of locations throughout the facility);

(5)    Finished product testing;

(6)    Supplier approval and verification programs; and

(7)    Review of the records associated with these activities.

In the gutted version that emerged from OIRA’s review, the FDA clarified that it is not proposing any of these measures at this time but is instead just requesting comment on them. Meanwhile, all the information prepared by the agency to explain and justify these requirements was relegated to an appendix at the back of the preamble. 

OIRA’s meddling was more than just a change in form: Industry groups have seized on the technical distinction between “proposing” and “requesting comment,” threatening that the FDA would be violating the Administrative Procedure Act if it includes these requirements in the final rule without providing additional opportunities for comment.  In effect they are insisting that if FDA decides to add one of the provisions that OIRA deleted from the text of the proposed rule, the agency would have to promulgate a second proposed rule, with additional months (or years) of needless delay.  This is, of course, a specious argument, because the industry groups have access to all the FDA’s original draft documents, including the draft proposals containing the language that OIRA excised.  Thus, they can see exactly how these requirements would fit into the final rule, and they have ample opportunity to weigh in on them during this comment period—just like we are.  If FDA decides to restore the excised proposals, and we hope that it does, it should not be cowed by the industry objections into sending the proposal through another rulemaking exercise.

According to the FDA’s own research, the top factors responsible for tainted processed foods are (1) deficient employee training, (2) poor sanitation, (3) a lack of supplier controls, and (4) a lack of environmental monitoring. Yet the requirements that were specifically designed to address each of these areas were among those eliminated by the White House.

Many recent outbreaks may have been prevented if facilities had already adopted these measures. For example, thousands of products have become entangled in outbreaks and recalls because they failed to anticipate or detect contamination in their raw ingredients they obtained from suppliers—most notably in the peanut paste outbreak of 2009, which caused 714 illnesses and 9 deaths and resulted in the recall of nearly 4,000 different products that were made with the ingredient. And as the FDA describes it, undetected pathogens in the plant environment played a key role in Salmonella contamination of cereal, peanut butter, whey protein, and white pepper, and Listeria contamination of queso fresco, chopped celery, and cantaloupes.

The FDA’s economic analysis suggests that the costs of these provisions would be small compared to the immense gains in food safety they would bring. Except for the training requirements, each of them would “break even” with its own cost if it reduced illnesses by less than 1 percent. Because these measures would significantly enhance the rule’s effectiveness—perhaps to a greater extent than any of the vaguer, more malleable HARPC standards that the agency ultimately proposed—these levels of protection are more than plausible.

Cost of the Rule Will Be Much Lower Than Estimated

According to the FDA, the rule will have an annual domestic cost of $475 million (assuming the cutoff for the “very small business” exemption is set at $250,000 in annual sales, the lowest threshold being considered). The FDA also estimates that every year, processed foods cause nearly one million illnesses that cost society about $2 billion, a portion of which would be avoided under the rule.

But when we looked behind those numbers, it became clear that the rule’s benefits will be even more significant, and its costs considerably smaller, than the FDA suggests. (We discuss the rule’s costs here; we address how the FDA underestimates benefits across all the FSMA rules in a separate blog.)

Cost-benefit analyses characteristically overestimate compliance costs, in part because (1) they reflect overly conservative, outdated assumptions about how businesses operate, and (2) they fail to anticipate that the regulation will inspire technological and operational innovations that make it less expensive to comply. FDA’s analysis of the Preventive Controls rule is no different.

The proposed HARPC system relies largely on documentation—of a facility’s food safety plan, its procedures, its monitoring and verification activities, and its corrective actions. The rule’s recordkeeping activities are estimated to cost $296 million per year, or 62 percent of the rule’s total cost. But this estimate is based on a study from ten years ago and reflects the costs of manual recordkeeping tasks.

Food companies are much more likely to use electronic systems now, which would substantially reduce the amount of work-time spent on maintaining records. In fact, the number of facilities using electronic systems has risen rapidly in recent years; one recent survey suggested around 44 percent already use electronic food safety records. The rule itself is expected to push many more facilities toward modernization, which will not only make recordkeeping easier but also improve efficiency and profitability in other ways. As a result, the estimated cost of the rule is unrealistically high.

Finally, the experiences of other industries suggest that the costs will be manageable. In the late 1990s, as similar “HACCP” regulations were going into effect for the seafood industry, seafood processors had the same concerns about cost that processors of other foods are expressing now. But HACCP was not the financial disaster that many feared it would be, and the industry accommodated the new system without much difficulty—in fact, it made the industry stronger and more secure. Key to the successful transition was an alliance between academics, government agencies, and industry that trained and supported processors in their efforts to comply with the rule. The FDA is already coordinating a similar initiative for this rule. Before long, HARPC will be as routine for these facilities as HACCP has become for seafood and juice companies.

FDA should finalize this critically important rule as expeditiously as possible, and the final rule should contain all of the provisions that OIRA unceremoniously removed out of a wholly unwarranted concern for the economic impact on an industry that can easily afford them.

Our comment is availablehere.

© 2014 The Center for Progressive Reform