2014 US Code
Title 21 - Food and Drugs (Sections 1 - 2252)
Chapter 9 - Federal Food, Drug, and Cosmetic Act (Sections 301 - 399f)
Subchapter III - Prohibited Acts and Penalties (Sections 331 - 337a)
Sec. 335a - Debarment, temporary denial of approval, and suspension

If the Secretary finds that a person other than an individual has been convicted, after May 13, 1992, of a felony under Federal law for conduct relating to the development or approval, including the process for development or approval, of any abbreviated drug application, the Secretary shall debar such person from submitting, or assisting in the submission of, any such application.

If the Secretary finds that an individual has been convicted of a felony under Federal law for conduct—

(A) relating to the development or approval, including the process for development or approval, of any drug product, or

(B) otherwise relating to the regulation of any drug product under this chapter,

the Secretary shall debar such individual from providing services in any capacity to a person that has an approved or pending drug product application.

The Secretary, on the Secretary's own initiative or in response to a petition, may, in accordance with paragraph (2), debar—

(A) a person other than an individual from submitting or assisting in the submission of any abbreviated drug application,

(B) an individual from providing services in any capacity to a person that has an approved or pending drug product application, or

(C) a person from importing an article of food or offering such an article for import into the United States.

The following persons are subject to debarment under subparagraph (A) or (B) of paragraph (1):

Any person other than an individual that the Secretary finds has been convicted—

(i) for conduct that—

(I) relates to the development or approval, including the process for the development or approval, of any abbreviated drug application; and

(II) is a felony under Federal law (if the person was convicted before May 13, 1992), a misdemeanor under Federal law, or a felony under State law, or

(ii) of a conspiracy to commit, or aiding or abetting, a criminal offense described in clause (i) or a felony described in subsection (a)(1) of this section,

if the Secretary finds that the type of conduct which served as the basis for such conviction undermines the process for the regulation of drugs.

(i) Any individual whom the Secretary finds has been convicted of—

(I) a misdemeanor under Federal law or a felony under State law for conduct relating to the development or approval, including the process for development or approval, of any drug product or otherwise relating to the regulation of drug products under this chapter, or

(II) a conspiracy to commit, or aiding or abetting, such criminal offense or a felony described in subsection (a)(2) of this section,

if the Secretary finds that the type of conduct which served as the basis for such conviction undermines the process for the regulation of drugs.

(ii) Any individual whom the Secretary finds has been convicted of—

(I) a felony which is not described in subsection (a)(2) of this section or clause (i) of this subparagraph and which involves bribery, payment of illegal gratuities, fraud, perjury, false statement, racketeering, blackmail, extortion, falsification or destruction of records, or interference with, obstruction of an investigation into, or prosecution of, any criminal offense, or

(II) a conspiracy to commit, or aiding or abetting, such felony,

if the Secretary finds, on the basis of the conviction of such individual and other information, that such individual has demonstrated a pattern of conduct sufficient to find that there is reason to believe that such individual may violate requirements under this chapter relating to drug products.

(iii) Any individual whom the Secretary finds materially participated in acts that were the basis for a conviction for an offense described in subsection (a) of this section or in clause (i) or (ii) for which a conviction was obtained, if the Secretary finds, on the basis of such participation and other information, that such individual has demonstrated a pattern of conduct sufficient to find that there is reason to believe that such individual may violate requirements under this chapter relating to drug products.

(iv) Any high managerial agent whom the Secretary finds—

(I) worked for, or worked as a consultant for, the same person as another individual during the period in which such other individual took actions for which a felony conviction was obtained and which resulted in the debarment under subsection (a)(2) of this section, or clause (i), of such other individual,

(II) had actual knowledge of the actions described in subclause (I) of such other individual, or took action to avoid such actual knowledge, or failed to take action for the purpose of avoiding such actual knowledge,

(III) knew that the actions described in subclause (I) were violative of law, and

(IV) did not report such actions, or did not cause such actions to be reported, to an officer, employee, or agent of the Department or to an appropriate law enforcement officer, or failed to take other appropriate action that would have ensured that the process for the regulation of drugs was not undermined, within a reasonable time after such agent first knew of such actions,

if the Secretary finds that the type of conduct which served as the basis for such other individual's conviction undermines the process for the regulation of drugs.

A person is subject to debarment under paragraph (1)(C) if—

(A) the person has been convicted of a felony for conduct relating to the importation into the United States of any food; or

(B) the person has engaged in a pattern of importing or offering for import adulterated food that presents a threat of serious adverse health consequences or death to humans or animals.

An order of the Secretary under clause (iii) or (iv) of paragraph (2)(B) shall not take effect until 30 days after the order has been issued.

The Secretary—

(A) shall not accept or review (other than in connection with an audit under this section) any abbreviated drug application submitted by or with the assistance of a person debarred under subsection (a)(1) or (b)(2)(A) of this section during the period such person is debarred,

(B) shall, during the period of a debarment under subsection (a)(2) or (b)(2)(B) of this section, debar an individual from providing services in any capacity to a person that has an approved or pending drug product application and shall not accept or review (other than in connection with an audit under this section) an abbreviated drug application from such individual, and

(C) shall, if the Secretary makes the finding described in paragraph (6) or (7) of section 335b(a) of this title, assess a civil penalty in accordance with section 335b of this title.

The Secretary shall debar a person under subsection (a) or (b) of this section for the following periods:

(i) The period of debarment of a person (other than an individual) under subsection (a)(1) of this section shall not be less than 1 year or more than 10 years, but if an act leading to a subsequent debarment under subsection (a) of this section occurs within 10 years after such person has been debarred under subsection (a)(1) of this section, the period of debarment shall be permanent.

(ii) The debarment of an individual under subsection (a)(2) of this section shall be permanent.

(iii) The period of debarment of any person under paragraph (2) or (3) of subsection (b) of this section shall not be more than 5 years.

The Secretary may determine whether debarment periods shall run concurrently or consecutively in the case of a person debarred for multiple offenses.

Upon a conviction for an offense described in subsection (a) or (b) of this section or upon execution of an agreement with the United States to plead guilty to such an offense, the person involved may notify the Secretary that the person acquiesces to debarment and such person's debarment shall commence upon such notification.

In determining the appropriateness and the period of a debarment of a person under subsection (b) of this section and any period of debarment beyond the minimum specified in subparagraph (A)(i) of paragraph (2), the Secretary shall consider where applicable—

(A) the nature and seriousness of any offense involved,

(B) the nature and extent of management participation in any offense involved, whether corporate policies and practices encouraged the offense, including whether inadequate institutional controls contributed to the offense,

(C) the nature and extent of voluntary steps to mitigate the impact on the public of any offense involved, including the recall or the discontinuation of the distribution of suspect drugs, full cooperation with any investigations (including the extent of disclosure to appropriate authorities of all wrongdoing), the relinquishing of profits on drug approvals fraudulently obtained, and any other actions taken to substantially limit potential or actual adverse effects on the public health,

(D) whether the extent to which changes in ownership, management, or operations have corrected the causes of any offense involved and provide reasonable assurances that the offense will not occur in the future,

(E) whether the person to be debarred is able to present adequate evidence that current production of drugs subject to abbreviated drug applications and all pending abbreviated drug applications are free of fraud or material false statements, and

(F) prior convictions under this chapter or under other Acts involving matters within the jurisdiction of the Food and Drug Administration.

Any person that is debarred under subsection (a) of this section (other than a person permanently debarred) or any person that is debarred under subsection (b) of this section may apply to the Secretary for termination of the debarment under this subsection. Any information submitted to the Secretary under this paragraph does not constitute an amendment or supplement to pending or approved abbreviated drug applications.

The Secretary shall grant or deny any application respecting a debarment which is submitted under paragraph (1) within 180 days of the date the application is submitted.

If the conviction which served as the basis for the debarment of a person under subsection (a)(1) of this section or paragraph (2)(A) or (3) of subsection (b) of this section is reversed, the Secretary shall withdraw the order of debarment.

Upon application submitted under paragraph (1), the Secretary shall terminate the debarment of a person if the Secretary finds that—

(I) changes in ownership, management, or operations have fully corrected the causes of the offense involved and provide reasonable assurances that the offense will not occur in the future, and

(II) in applicable cases, sufficient audits, conducted by the Food and Drug Administration or by independent experts acceptable to the Food and Drug Administration, demonstrate that pending applications and the development of drugs being tested before the submission of an application are free of fraud or material false statements.

 In the case of persons debarred under subsection (a)(1) of this section, such termination shall take effect no earlier than the expiration of one year from the date of the debarment.

If the conviction which served as the basis for the debarment of an individual under subsection (a)(2) of this section or clause (i), (ii), (iii), or (iv) of subsection (b)(2)(B) or subsection (b)(3) of this section is reversed, the Secretary shall withdraw the order of debarment.

Upon application submitted under paragraph (1), the Secretary shall terminate the debarment of an individual who has been debarred under subsection (b)(2)(B) or subsection (b)(3) of this section if such termination serves the interests of justice and adequately protects the integrity of the drug approval process or the food importation process, as the case may be.

Any person that is debarred under subsection (a)(1) of this section (other than a person permanently debarred under subsection (c)(2)(A)(i) of this section) or any individual who is debarred under subsection (a)(2) of this section may apply to the Secretary for special termination of debarment under this subsection. Any information submitted to the Secretary under this subparagraph does not constitute an amendment or supplement to pending or approved abbreviated drug applications.

Upon an application submitted under subparagraph (A), the Secretary may take the action described in subparagraph (D) if the Secretary, after an informal hearing, finds that—

(i) the person making the application under subparagraph (A) has demonstrated that the felony conviction which was the basis for such person's debarment involved the commission of an offense which was not authorized, requested, commanded, performed, or recklessly tolerated by the board of directors or by a high managerial agent acting on behalf of the person within the scope of the board's or agent's office or employment,

(ii) all individuals who were involved in the commission of the offense or who knew or should have known of the offense have been removed from employment involving the development or approval of any drug subject to sections ¹ 355 of this title,

(iii) the person fully cooperated with all investigations and promptly disclosed all wrongdoing to the appropriate authorities, and

(iv) the person acted to mitigate any impact on the public of any offense involved, including the recall, or the discontinuation of the distribution, of any drug with respect to which the Secretary requested a recall or discontinuation of distribution due to concerns about the safety or efficacy of the drug.

Upon an application submitted under subparagraph (A), the Secretary may take the action described in subparagraph (D) if the Secretary, after an informal hearing, finds that such individual has provided substantial assistance in the investigations or prosecutions of offenses which are described in subsection (a) or (b) of this section or which relate to any matter under the jurisdiction of the Food and Drug Administration.

The action referred to in subparagraphs (B) and (C) is—

(i) in the case of a person other than an individual—

(I) terminating the debarment immediately, or

(II) limiting the period of debarment to less than one year, and

(ii) in the case of an individual, limiting the period of debarment to less than permanent but to no less than 1 year,

whichever best serves the interest of justice and protects the integrity of the drug approval process.

The Secretary shall publish in the Federal Register the name of any person debarred under subsection (a) or (b) of this section, the effective date of the debarment, and the period of the debarment. The Secretary shall also maintain and make available to the public a list, updated no less often than quarterly, of such persons, of the effective dates and minimum periods of such debarments, and of the termination of debarments.

The Secretary, on the Secretary's own initiative or in response to a petition, may, in accordance with paragraph (3), refuse by order, for the period prescribed by paragraph (2), to approve any abbreviated drug application submitted by any person—

(A) if such person is under an active Federal criminal investigation in connection with an action described in subparagraph (B),

(B) if the Secretary finds that such person—

(i) has bribed or attempted to bribe, has paid or attempted to pay an illegal gratuity, or has induced or attempted to induce another person to bribe or pay an illegal gratuity to any officer, employee, or agent of the Department of Health and Human Services or to any other Federal, State, or local official in connection with any abbreviated drug application, or has conspired to commit, or aided or abetted, such actions, or

(ii) has knowingly made or caused to be made a pattern or practice of false statements or misrepresentations with respect to material facts relating to any abbreviated drug application, or the production of any drug subject to an abbreviated drug application, to any officer, employee, or agent of the Department of Health and Human Services, or has conspired to commit, or aided or abetted, such actions, and

(C) if a significant question has been raised regarding—

(i) the integrity of the approval process with respect to such abbreviated drug application, or

(ii) the reliability of data in or concerning such person's abbreviated drug application.

Such an order may be modified or terminated at any time.

Except as provided in subparagraph (B), a denial of approval of an application of a person under paragraph (1) shall be in effect for a period determined by the Secretary but not to exceed 18 months beginning on the date the Secretary finds that the conditions described in subparagraphs (A), (B), and (C) of paragraph (1) exist. The Secretary shall terminate such denial—

(i) if the investigation with respect to which the finding was made does not result in a criminal charge against such person, if criminal charges have been brought and the charges have been dismissed, or if a judgment of acquittal has been entered, or

(ii) if the Secretary determines that such finding was in error.

If, at the end of the period described in subparagraph (A), the Secretary determines that a person has been criminally charged for an action described in subparagraph (B) of paragraph (1), the Secretary may extend the period of denial of approval of an application for a period not to exceed 18 months. The Secretary shall terminate such extension if the charges have been dismissed, if a judgment of acquittal has been entered, or if the Secretary determines that the finding described in subparagraph (A) was in error.

Within 10 days of the date an order is issued under paragraph (1), the Secretary shall provide such person with an opportunity for an informal hearing, to be held within such 10 days, on the decision of the Secretary to refuse approval of an abbreviated drug application. Within 60 days of the date on which such hearing is held, the Secretary shall notify the person given such hearing whether the Secretary's refusal of approval will be continued, terminated, or otherwise modified. Such notification shall be final agency action.

If—

(A) the Secretary finds—

(i) that a person has engaged in conduct described in subparagraph (B) of subsection (f)(1) of this section in connection with 2 or more drugs under abbreviated drug applications, or

(ii) that a person has engaged in flagrant and repeated, material violations of good manufacturing practice or good laboratory practice in connection with the development, manufacturing, or distribution of one or more drugs approved under an abbreviated drug application during a 2-year period, and—

(I) such violations may undermine the safety and efficacy of such drugs, and

(II) the causes of such violations have not been corrected within a reasonable period of time following notice of such violations by the Secretary, and

(B) such person is under an active investigation by a Federal authority in connection with a civil or criminal action involving conduct described in subparagraph (A),

the Secretary shall issue an order suspending the distribution of all drugs the development or approval of which was related to such conduct described in subparagraph (A) or suspending the distribution of all drugs approved under abbreviated drug applications of such person if the Secretary finds that such conduct may have affected the development or approval of a significant number of drugs which the Secretary is unable to identify. The Secretary shall exclude a drug from such order if the Secretary determines that such conduct was not likely to have influenced the safety or efficacy of such drug.

The Secretary shall, on the Secretary's own initiative or in response to a petition, waive the suspension under paragraph (1) (involving an action described in paragraph (1)(A)(i)) with respect to any drug if the Secretary finds that such waiver is necessary to protect the public health because sufficient quantities of the drug would not otherwise be available. The Secretary shall act on any petition seeking action under this paragraph within 180 days of the date the petition is submitted to the Secretary.

The Secretary shall withdraw an order of suspension of the distribution of a drug under subsection (g) of this section if the person with respect to whom the order was issued demonstrates in a petition to the Secretary—

(1)(A) on the basis of an audit by the Food and Drug Administration or by experts acceptable to the Food and Drug Administration, or on the basis of other information, that the development, approval, manufacturing, and distribution of such drug is in substantial compliance with the applicable requirements of this chapter, and

(B) changes in ownership, management, or operations—

(i) fully remedy the patterns or practices with respect to which the order was issued, and

(ii) provide reasonable assurances that such actions will not occur in the future, or

(2) the initial determination was in error.

The Secretary shall act on a submission of a petition under this subsection within 180 days of the date of its submission and the Secretary may consider the petition concurrently with the suspension proceeding. Any information submitted to the Secretary under this subsection does not constitute an amendment or supplement to a pending or approved abbreviated drug application.

The Secretary may not take any action under subsection (a), (b), (c), (d)(3), (g), or (h) of this section with respect to any person unless the Secretary has issued an order for such action made on the record after opportunity for an agency hearing on disputed issues of material fact. In the course of any investigation or hearing under this subsection, the Secretary may administer oaths and affirmations, examine witnesses, receive evidence, and issue subpoenas requiring the attendance and testimony of witnesses and the production of evidence that relates to the matter under investigation.

Except as provided in paragraph (2), any person that is the subject of an adverse decision under subsection (a), (b), (c), (d), (f), (g), or (h) of this section may obtain a review of such decision by the United States Court of Appeals for the District of Columbia or for the circuit in which the person resides, by filing in such court (within 60 days following the date the person is notified of the Secretary's decision) a petition requesting that the decision be modified or set aside.

Any person that is the subject of an adverse decision under clause (iii) or (iv) of subsection (b)(2)(B) of this section may obtain a review of such decision by the United States District Court for the District of Columbia or a district court of the United States for the district in which the person resides, by filing in such court (within 30 days following the date the person is notified of the Secretary's decision) a complaint requesting that the decision be modified or set aside. In such an action, the court shall determine the matter de novo.

Any application for approval of a drug product shall include—

(1) a certification that the applicant did not and will not use in any capacity the services of any person debarred under subsection (a) or (b) of this section, in connection with such application, and

(2) if such application is an abbreviated drug application, a list of all convictions, described in subsections (a) and (b) of this section which occurred within the previous 5 years, of the applicant and affiliated persons responsible for the development or submission of such application.

For purposes of this section, a person is considered to have been convicted of a criminal offense—

(A) when a judgment of conviction has been entered against the person by a Federal or State court, regardless of whether there is an appeal pending,

(B) when a plea of guilty or nolo contendere by the person has been accepted by a Federal or State court, or

(C) when the person has entered into participation in a first offender, deferred adjudication, or other similar arrangement or program where judgment of conviction has been withheld.

Subsection (a) of this section, subparagraph (A) of subsection (b)(2) of this section, clauses (i) and (ii) of subsection (b)(2)(B) of this section, and subsection (b)(3)(A) of this section shall not apply to a conviction which occurred more than 5 years before the initiation of an agency action proposed to be taken under subsection (a) or (b) of this section. Clauses (iii) and (iv) of subsection (b)(2)(B) of this section, subsection (b)(3)(B) of this section, and subsections (f) and (g) of this section shall not apply to an act or action which occurred more than 5 years before the initiation of an agency action proposed to be taken under subsection (b), (f), or (g) of this section. Clause (iv) of subsection (b)(2)(B) of this section shall not apply to an action which occurred before June 1, 1992. Subsection (k) of this section shall not apply to applications submitted to the Secretary before June 1, 1992.

If the Secretary finds that a person has been convicted of a felony under section 331(gg) of this title, the Secretary shall debar such person from being accredited under section 360m(b) or 374(g)(2) of this title and from carrying out activities under an agreement described in section 383(b) of this title.

The Secretary shall debar a person under paragraph (1) for the following periods:

(A) The period of debarment of a person (other than an individual) shall not be less than 1 year or more than 10 years, but if an act leading to a subsequent debarment under such paragraph occurs within 10 years after such person has been debarred under such paragraph, the period of debarment shall be permanent.

(B) The debarment of an individual shall be permanent.

Subsections (c)(3), (d), (e), (i), (j), and (l)(1) of this section apply with respect to a person (other than an individual) or an individual who is debarred under paragraph (1) to the same extent and in the same manner as such subsections apply with respect to a person who is debarred under subsection (a)(1) of this section, or an individual who is debarred under subsection (a)(2) of this section, respectively.

(June 25, 1938, ch. 675, §306, as added Pub. L. 102–282, §2, May 13, 1992, 106 Stat. 150; amended Pub. L. 105–115, title I, §125(b)(2)(C), Nov. 21, 1997, 111 Stat. 2325; Pub. L. 107–188, title III, §304(a)–(c), June 12, 2002, 116 Stat. 665, 666; Pub. L. 107–250, title II, §203, Oct. 26, 2002, 116 Stat. 1610.)

A prior section 306 of act June 25, 1938, was renumbered section 309 and is classified to section 336 of this title.

2002—Subsec. (a). Pub. L. 107–188, §304(b)(1), substituted "Mandatory debarment; certain drug applications" for "Mandatory debarment" in heading.

Subsec. (b). Pub. L. 107–188, §304(b)(2)(A), substituted "Permissive debarment; certain drug applications; food imports" for "Permissive debarment" in heading.

Subsec. (b)(1)(C). Pub. L. 107–188, §304(a)(1), added subpar. (C).

Subsec. (b)(2). Pub. L. 107–188, §304(b)(2)(B), substituted "permissive debarment; certain drug applications" for "permissive debarment" in heading.

Pub. L. 107–188, §304(a)(2)(A), inserted "subparagraph (A) or (B) of" before "paragraph (1)" in introductory provisions.

Subsec. (b)(3), (4). Pub. L. 107–188, §304(a)(2)(B), (C), added par. (3) and redesignated former par. (3) as (4).

Subsec. (c)(2)(A)(iii). Pub. L. 107–188, §304(b)(3), substituted "paragraph (2) or (3) of subsection (b)" for "subsection (b)(2)".

Subsec. (d)(3)(A)(i). Pub. L. 107–188, §304(b)(4)(A), substituted "subsection (a)(1) of this section or paragraph (2)(A) or (3) of subsection (b)" for "subsection (a)(1) or (b)(2)(A)".

Subsec. (d)(3)(A)(ii)(II). Pub. L. 107–188, §304(b)(4)(B), inserted "in applicable cases," before "sufficient audits".

Subsec. (d)(3)(B)(i). Pub. L. 107–188, §304(b)(4)(C), inserted "or subsection (b)(3)" after "subsection (b)(2)(B)".

Subsec. (d)(3)(B)(ii). Pub. L. 107–188, §304(b)(4)(C), (D), inserted "or subsection (b)(3)" after "subsection (b)(2)(B)" and "or the food importation process, as the case may be" before period.

Subsec. (l)(2). Pub. L. 107–188, §304(c), in first sentence struck out "and" after "subsection (b)(2) of this section," and inserted ", and subsection (b)(3)(A) of this section" after "subsection (b)(2)(B) of this section" and in second sentence inserted ", subsection (b)(3)(B) of this section," after "subsection (b)(2)(B) of this section".

Subsec. (m). Pub. L. 107–250 added subsec. (m).

1997—Subsec. (d)(4)(B)(ii). Pub. L. 105–115 struck out "or 357" after "355".

Pub. L. 102–282, §7, May 13, 1992, 106 Stat. 162, provided that: "No amendment made by this Act [enacting this section and sections 335b and 335c of this title and amending sections 321, 336, 337, and 355 of this title] shall preclude any other civil, criminal, or administrative remedy provided under Federal or State law, including any private right of action against any person for the same action subject to any action or civil penalty under an amendment made by this Act."

Pub. L. 102–282, §1(c), May 13, 1992, 106 Stat. 149, provided that: "The Congress finds that—

"(1) there is substantial evidence that significant corruption occurred in the Food and Drug Administration's process of approving drugs under abbreviated drug applications,

"(2) there is a need to establish procedures designed to restore and to ensure the integrity of the abbreviated drug application approval process and to protect the public health, and

"(3) there is a need to establish procedures to bar individuals who have been convicted of crimes pertaining to the regulation of drug products from working for companies that manufacture or distribute such products."

¹ So in original. Probably should be "section".