JUDICIAL REVIEW OF ORDERS CONCERNING BIOLOGICAL PRODUCTS TUESDAY, JULY 9, 1963 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON PUBLIC HEALTH AND SAFETY OF THE COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE, Washington, D.C. The subcommittee met at 10 a.m., pursuant to call, in room 1334, Longworth Building, Hon. Kenneth A. Roberts (chairman of the subcommittee) presiding. Mr. ROBERTS. The subcommittee will please be in order. The hearing today is on H.R. 3408 introduced by the distinguished gentleman from Illinois, Mr. Libonati. The bill seeks to amend the Public Health Service Act. It would provide judicial review of orders concerning biological products. We are very happy to have you, Mr. Libonati, to appear before our subcommittee. You may proceed with your statement. (H.R. 3408 and departmental reports follow:) [H.R. 3408, 88th Cong., 1st sess.] A BILL To amend the Public Health Service Act to provide judicial review of agency orders concerning biological products Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 351 of the Public Health Service Act, as amended (42 U.S.C. 262), is further amended by adding the following new subsection: "(h) If the Secretary refuses to issue, suspends, or revokes any license for the maintenance of an establishment or for the propagation or manufacture and preparation of products described in subsection (a) of this section, he shall do so only after due notice to the applicant or the party in interest, as the case may be, and after having given him an opportunity for a hearing. "An appeal may be taken by the applicant or party in interest from an order of the Secretary refusing to issue, suspending, or revoking any license covered by subsection (a) of this section. Such appeal shall be taken by filing in the United States Court of Appeals pursuant to section 2112 of title 28, United States Code, a written petition praying that the order of the Secretary be set aside. A copy of such petition shall, upon filing, be forthwith transmitted to the Secretary by the clerk of the court and the Secretary shall thereupon file in the court the record, if any, upon which the order complained of was entered, in accordance with section 2112 of title 28, United States Code. Upon the filing of the petition, the court shall have jurisdiction, which upon filing of the record with it shall be exclusive, to affirm or set aside the order complained of in whole or in part. Until the filing of the record, the Secretary may modify or set aside his order. The findings of the Secretary with respect to questions of fact shall be sustained if supported by substantial evidence when considered on the record as a whole. "If application is made to the court for leave to adduce additional evidence and the court is satisfied that such additional evidence is material and that there were reasonable grounds for the failure to adduce such evidence in the proceed ings below, the court may order such additional evidence to be taken by the Sec retary or his delegate in such manner and upon such conditions as the court may direct. The Secretary may modify his findings by reason of the additional evidence taken and he shall file with the court such modified findings as well as any changes he may make with regard to the original order. The court may order such additional evidence to be made a part of the record and if supported by substantial evidence, the findings of the Secretary shall be conclusive. "The judgment of the court affirming or setting aside, in whole or in part, any order under this section shall be final, subject to review by the Supreme Court of the United States upon certiorari or certification as provided in section 1254 of title 28, United States Code." Hon. OREN HARRIS, DEPARTMENT OF HEALTH, EDUCATION, AND Welfare, Chairman, Committee on Interstate and Foreign Commerce, July 3, 1963. DEAR MR. CHAIRMAN: This letter is in response to your request of February 22, 1963, for a report on H.R. 3408, a bill to amend the Public Health Service Act to provide judicial review of agency orders concerning biological products. This bill would amend section 351 of the Public Health Service Act (58 Stat. 702) as amended (42 U.S.C. 262), to provide that an applicant or party in interest may be given due notice and an opportunity for hearing if the Secretary refuses to issue, suspends, or revokes any license for the maintenance of an establishment for the propagation or manufacture and preparation of biological products as described in section 351. The proposed amendment would also provide review in the U.S. court of appeals of an order of the Secretary refusing to issue, suspending, or revoking a license. This Department recognizes the appropriateness of adequate legal safeguards to protect the rights of applicants and licensees affected by the provisions of section 351 of the Public Health Service Act, which requires the Surgeon General to prescribe standards designed to insure the continued safety, purity, and potency of the products subject to license. Accordingly, Public Health Service regulations (pt. 73) provide, in addition to other safeguards, an opportunity for hearing by a special review board to any manufacturer whose application has been denied. It is also provided that (except where there is a danger to health) a licensee shall be advised in writing of the facts or conduct which may warrant the suspension or revocation of his license, and shall be accorded an opportunity to demonstrate or achieve compliance. In the event that noncompliance is continued, the licensee will be afforded notice and an opportunity for hearing prior to the decision of the Surgeon General as to whether he will recommend that the Secretary suspend or revoke the license. Moreover, the validity of a denial, revocation, or suspension is undoubtedly reviewable by the courts in an appropriate proceeding. Since the enactment of the biologics control programs in 1902, the provisions of which later became section 351 of the Public Health Service Act, there has, so far as we are aware, been no instance in which an administrative hearing has been requested, or judicial review of a determination sought, of any action taken under this program. Nevertheless, we would have no objection to the inclusion of appropriate specific provisions, in the statute, for opportunity for hearing and for judicial review, if the committee should feel the insertion of such provisions to be desirable, notwithstanding the remoteness of any occasion for their actual use in the light of past history. However, while the basic pattern of the bill is in the main soundly conceived, we believe that the following amendments are required: First, provision should be made for the summary suspension by the Secretary of a license pending hearing, when the distribution or sale of a licensed product pending hearing constitutes a danger to health. This would be in line with the summary-suspension provision enacted as an amendment to the newdrug section (i.e., sec. 505) of the Federal Food, Drug, and Cosmetic Act by last year's Harris-Kefauver amendments (Drug Amendments of 1962). Such provision, moreover, is now made administratively for biological drugs in section 73.11 of the above-mentioned Public Health Service regulations. Obviously, the provisions of H.R. 3408 requiring due notice and opportunity for hearing would be too time-consuming to provide adequate protection for the public health in certain health emergencies. Second, we believe that the notice required to be given under the bill, the opportunity for hearing, and the right to appeal should be limited to applicants and licensees under section 351 of the Public Health Service Act. Inasmuch as such applicants and licensees constitute the only interested parties for the purposes of notice, opportunity for hearings, and judicial review, the bill's extension of these provisions to "the party in interest" is unnecessary and, because of its vagueness, likely to encourage claims for redress by those without legal interest in the subject matter of such claims. Third, we concur in the suggestions, made in the Justice Department's report, that the bill be amended to (a) delete the word “or” at the beginning of line 8 on page 1; (b) specify the venue and the time limit for appeal, e.g., 60 days; and (c) make clear that an appeal shall not, unless specifically ordered by the court to the contrary, operate as a stay of the order of the Secretary. (Cf. sec. 409 (g) (5) of the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 348.) We are, therefore, constrained to object to the bill in its present form but would have no objection to enactment of the bill if it is amended in the respects above stated. We are advised by the Bureau of the Budget that there is no objection to the presentation of this report from the standpoint of the administration's pro Chairman, Committee on Interstate and Foreign Commerce, DEAR MR. CHAIRMAN: This is in response to your request for the views of the Bureau of the Budget on H.R. 3408, a bill to amend the Public Health Service Act to provide judicial review of agency orders concerning biological products. The bill would amend section 351 of the Public Health Service Act (42 U.S.C. 262), which prohibits interstate traffic in certain biological products unless they were propagated or manufactured and prepared at an establishment licensed by the Secretary of Health, Education, and Welfare. A new subsection (h) would be added to provide that the Secretary shall suspend, revoke, or refuse to issue a license only after due notice and an opportunity for hearing to the applicant or party in interest. The Secretary's order in such a case would be appealable to the U.S. court of appeals which would have jurisdiction to affirm or set aside the order in whole or in part. Findings of the Secretary concerning questions of fact would have to be sustained if supported by substantial evidence when considered on the record as a whole. Subject to revisions in the bill indicated in the reports of the Departments of Justice and Health, Education, and Welfare, there would be no objection from the standpoint of the administration's program to enactment of H.R. 3408. Sincerely yours, PHILLIP S. HUGHES, Assistant Director for Legislative Reference. Hon. OREN HARRIS, U.S. DEPARTMENT OF JUSTICE, OFFICE OF THE DEPUTY ATTORNEY GENERAL, Chairman, Committee on Interstate and Foreign Commerce, DEAR MR. CHAIRMAN: This is in response to your request for the views of the Department of Justice concerning H.R. 3408, a bill to amend the Public Health Service Act to provide judicial review of agency orders concerning biological products. The bill would amend section 351 of the Public Health Service Act (42 U.S.C. 262), which prohibits interstate traffic in certain biological products unless they were propagated or manufactured and prepared at an establishment licensed by the Secretary of Health, Education, and Welfare. A new subsection (h) would be added to provide that the Secretary shall suspend, revoke, or refuse to issue a license only after giving due notice and an opportunity for hearing to the applicant or party in interest. The Secretary's order in such a case would be appealable to the U.S. court of appeals which would have jurisdiction to affirm or set aside the order in whole or in part. Findings of the Secretary concerning questions of fact would have to be sustained if supported by substantial evidence when considered on the record as a whole. The Department of Justice makes no recommendation as to whether judicial review of the Secretary's orders in such cases should be provided. However, the committee's attention is directed to several aspects of this measure. We assume that the term "party in interest," used in the bill, is intended to refer to a person whose license is suspended or revoked by the Secretary. However, in order to eliminate any possible ambiguity as to who is meant to be included within this term, thereby precluding demand for judicial review by persons not directly affected by the Secretary's order, it is suggested that the word "licensee" be substituted. The bill fails to specify the particular court of appeals to which an appeal from the Secretary's order shall be taken. Accordingly, the committee may wish to include a provision establishing venue in the court of appeals for the circuit in which the applicant or licensee resides or has his principal place of business or in the U.S. Court of Appeals for the District of Columbia. This would be in keeping with statutes similarly providing for direct review of administrative action in the courts of appeals. In addition, the measure fails to specify a time limit within which an appeal from the Secretary's order may be taken. Other statutes providing for direct appeal from administrative orders require that any appeal be filed within a designated number of days, usually 60, from the date of the order. Since the national health and welfare are so vitally involved in matters arising under this section of the Public Health Service Act, it is desirable to make it clear that the initiation of an appeal does not operate as a stay of the Secretary's order. Further, there is no provision in the bill for summary suspension of a license by the Secretary although such immediate action could be required for the protection of the national health and welfare. We suggest that provision for such a contingency be made in this measure. Finally, in the event of an appeal, the Secretary would be required to file in the court of appeals the "record, if any." If jurisdiction over these appeals is to be vested in the courts of appeals, the bill should require that a record be filed. By way of a technical suggestion, the word "or" at the beginning of line 8, page 1, would appear to be incorrect and should be deleted. The Bureau of the Budget has advised that there is no objection to the submission of this report from the standpoint of the administration's program. Sincerely yours, JOSEPH F. DOLAN, Assistant Deputy Attorney General. STATEMENT OF HON. ROLAND V. LIBONATI, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS Mr. LIBONATI. Mr. Chairman, I am proud to come before this subcommittee. I realize that time is of the essence and you have been solicitous and cooperative to give me this time to speak on this bill. It is a short bill and it has for its purpose the addition of subsection H which provides for a judicial review upon the refusal of the Department of Health, Education, and Welfare, Food and Drug Administration, to issue, suspend, or revoke any license for the maintenance of the establishment or for the propagation or manufacture and preparation of a drug. |