HHS finalizes Good Guidance Practice Final Rule

Importantly, to avoid disparities between the rules around guidance that apply to the FDA and other agencies under the HHS, the Final Rule clarifies that the FDA must comply with all requirements implemented in the Final Rule until the Secretary issues a Final Rule amending the FDA’s Good Guidance Practices regulations. Requiring the FDA to comply with the HHS Good Guidance Practices may have substantial impact for two reasons: (1) it potentially broadens the FDA’s existing definition of “guidance documents”; and (2) requires HHS review and approval of certain types of guidance documents on a non-delegable basis. These changes may influence how the FDA interacts with industry through the use of guidance documents.

Background and Overview

Generally, the Administrative Procedures Act (APA) mandates that rules imposing new obligations on regulated parties must go through notice-and-comment rulemaking.² However, agencies can issue interpretive rules and statements of policy without conducting notice-and-comment rulemaking, although such regulatory guidance lacks the force and effect of law, and cannot bind regulated parties.³ 

Executive Order 13891 (“Promoting the Rule of Law Through Improved Agency Guidance Documents”⁴) was issued in 2019, and requires agencies to finalize or amend existing regulations to set forth more transparent processes and procedures for issuing guidance documents. The Final Rule was published under the authority of the Executive Order, with the intent to outline Good Guidance Practices in accordance with APA requirements.

Final Rule Requirements

Definition of “Guidance Document”

The Final Rule defines guidance document broadly to mean “any Department statement of general applicability, intended to have future effect on the behavior of regulated parties and which sets forth a policy on a statutory, regulatory, or technical or scientific issue, or an interpretation of a statute or regulation”⁵ (emphasis added). Importantly, the Final Rule provides that if the Department issues a document that on its face is directed to a particular party, but the content of the document is designed to guide the conduct of other regulated parties, such a document would qualify as guidance⁶ (emphasis added).

Under the Final Rule, “Guidance document” does not include:

• rules promulgated pursuant to notice and comment under 5 U.S.C. 553, or similar statutory provisions;
• rules exempt from rulemaking requirements under 5 U.S.C. 553(a);
• rules of agency organization, procedure, or practice;
• decisions of agency adjudications under 5 U.S.C. 554, or similar statutory provisions;
• internal guidance directed to the Department or other agencies that is not intended to have substantial future effect on the behavior of regulated parties;
• internal executive branch legal advice or legal opinions addressed to executive branch officials;
• legal briefs and other court filings;
• grant solicitations and awards;
• contract solicitations and awards; or
• pre-enforcement rulings, i.e., communications with a person that interpret or apply the law to a specific set of facts, such as letter rulings, advisory opinions, no-action letters, and notices of noncompliance (emphasis added).

Final Rule Requirements

Consistent with the requirements under Executive Order 13891, the Final Rule clarifies HHS’s obligations for issuing guidance documents under the APA and requires the following:

• “Significant guidance documents”⁷ can only be issued after at least a 30-day public notice-and-comment period.⁸
• The HHS must approve, on a non-delegable basis, all non-significant guidances that the Secretary determines will either (1) implicate or impede policy matters of priority; or (2) where one operating division’s proposed non-significant guidance document may create a serious inconsistency (or otherwise interfere) with an action taken or planned by another operating division or the Office of the Secretary.
• The HHS:
  • May not issue any guidance document that establishes a legal obligation that is not reflected in an enacted statute or regulation.
  • Must identify documents as “guidance” and include specific language⁹ unless the guidance is authorized by law to be binding.
  • May not direct parties outside the Federal Government to take or refrain from taking action, except when restating—with citations to statutes, regulations, or binding judicial precedent—clear mandates contained in a statute or regulation.
  • Must include specific information, including the date, activities to which and the persons to whom the document applies, unique agency identifiers, whether the guidance replaces or revises previous guidance (and if so, identify such guidance), relevant citations and provisions, and a short summary of the subject matter.
• The HHS must include all of its guidance documents in a single, searchable guidance repository.¹⁰ Any guidance document not posted to the guidance repository by the effective date of the rule will be considered rescinded.
• The Final Rule creates a mechanism for any interested party to petition to withdraw or modify any guidance document(s).¹¹ These petitions may include requests to determine if a guidance (1) imposes binding obligations beyond the scope of the states/regulations, (2) creates legal obligations beyond what is required; and/or (2) is improperly exempted from the requirements under the Final Rule.

Application to FDA Guidance Documents 

Current FDA Good Guidance Practices

The FDA currently operates under a set of Good Guidance Practices regulations¹² as required by the Federal Food, Drug, and Cosmetic Act (FFDCA),¹³ but no other division within the HHS operates under a similar set of regulations. Under the FDA’s current regulations, “guidance document” means:

• Documents prepared for FDA staff, applicants/sponsors, and the public that describe the agency's interpretation of or policy on a regulatory issue.
• Documents that relate to: the design, production, labeling, promotion, manufacturing, and testing of regulated products; the processing, content, and evaluation or approval of submissions; and inspection and enforcement policies.¹⁴ 

“Guidance documents” do not include documents relating to internal FDA procedures, agency reports, general information documents provided to consumers or health professionals, speeches, journal articles and editorials, media interviews, press materials, warning letters, memoranda of understanding, or other communications directed to individual persons or firms.¹⁵ 

Impact of Final Rule on FDA Good Guidance Practices

The HHS plans to amend the FDA’s Good Guidance Practices regulations to conform to the requirements of Executive Order 13891 (and the Final Rule). To avoid significant disparities between the rules around guidance that apply to the FDA and the rest of the Department, the Final Rule clarifies that the FDA must comply with all requirements implemented in the Final Rule—to the extent not already incorporated in the FDA Good Guidance Practices regulations—until the Secretary issues a Final Rule amending the FDA’s Good Guidance Practices regulations.¹⁶ In other words, this new rule applies to the FDA as of 6 January 2021.

As noted above, the Final Rule defines guidance document broadly and includes “any Department statement of general applicability, intended to have future effect on the behavior of regulated parties and which sets forth a policy on a statutory, regulatory, or technical or scientific issue, or an interpretation of a statute or regulation.” This definition is arguably more expansive than the FDA’s current definition of “guidance document” and could include documents not currently subject to Good Guidance Practices. Further, if the FDA issues a document that on its face is directed to a particular party, but the content of the document is designed to guide the conduct of other regulated parties, such a document would arguably qualify as guidance. Note, however, that a number of FDA Warning Letters would likely fit under the exception in the Final Rule that exempts “pre-enforcement rulings, i.e., communications with a person that interpret or apply the law to a specific set of facts, such as letter rulings, advisory opinions, no-action letters, and notices of noncompliance.”¹⁷ We would expect the FDA to work out its interpretation in practice as to the scope of the Final Rule with the HHS over the coming months.

Further, the Final Rule codifies that all guidance documents must be submitted to—and reviewed by—the HHS because it is required (on a non-delegable basis) to determine whether non-significant guidances implicate or impede priority policy matters or create inconsistencies. Regardless of whether the Secretary determines that it must approve the guidance document, these reviews will increase the time from agency drafting to issuance. Further, if the HHS determines it must approve a guidance, this will further increase the time it takes to issue guidance, as there could be multiple rounds of inter and intra-agency communication regarding the scope, content, and appropriateness of the document.

These two considerations (i.e., potentially expanding the scope of what is considered guidance and the required HHS review and potential approval of said guidance) may substantially impact the FDA engagement with industry and may impact when the FDA decides to issue guidance documents in the future.

We will continue to monitor the HHS proposed and final regulations. Should you have any questions, please do not hesitate to contact us.

References

1    HHS Final Rule, Department of Health and Human Services Good Guidance Practices, 85 Fed. Reg. 78770 (7 Dec. 2020), https://www.govinfo.gov/content/pkg/FR-2020-12-07/pdf/2020-26832.pdf; see also 45 CFR §§ 1.1 – 1.5.

2    5 USC §§ 551 et seq.

3    See, e.g., Shalala v. Guernsey Mem’l Hosp., 514 U.S. 87, 99 (1995).

4    84 Fed. Reg. 55235 (15 Oct. 2019).

5    Id. at 78785.

6    Id.

7    “Significant guidance documents” are defined separately from “guidance documents,” and mean “a guidance document that may reasonably be anticipated to lead to an annual effect on the economy of US$100 million or more, or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights or obligations of recipients thereof; or raise novel legal or policy issues arising out of legal mandates, the President’s priorities, or the principles of Executive Order 12866. The term does not include the categories of documents exempted in writing by the Office of Management and Budget’s (OMB) Office of Information and Regulatory Affairs (OIRA).” Id.

8    The HHS states that it expects there to be relatively few “significant guidance documents” because many issuances satisfying one of the significant guidance document criteria may also impose binding new obligations. As such, these may be considered legislative rules that must go through the APA’s notice-and-comment rulemaking process. Parties who believe that HHS has incorrectly classified a legislative rule as a significant guidance document may utilize the petition process set forth in § 1.5.

9    The language must state “The contents of this document do not have the force and effect of law and are not meant to bind the public in any way, unless specifically incorporated into a contract. This document is intended only to provide clarity to the public regarding existing requirements under the law.”

10    The guidance repository will be located at https://www.hhs.gov/guidance/. 

11    The HHS simultaneously announced the withdrawal of a guidance document that was identified, in response to a Request for Information, as unlawfully purporting to impose binding obligations. See Guidance Document Rescinded For Non-Compliance With Allina and the Administrative Procedure Act. The announcement also encourages interested parties to utilize the petition process.

12    21 CFR § 10.115.

13    21 USC § 371(h). There were originally promulgated in 2000 (65 Fed. Reg. 56468 (19 Sept. 2000)) and later amended in 2018 (83 Fed. Reg. 13415 (29 March 2018).

14    21 CFR §§ 10.115(b)(1-2).

15    21 CFR § 10.115(b)(3).

16    85 Fed. Reg. at 787771.

17    Note, however, that some Warning Letters could be viewed as signaling more general agency guidance by using one company’s situation as an avenue for sharing the FDA expectations more broadly.

Authored by Joseph Levitt, Elizabeth Fawell, and Chris Forgues.