I wanted to provide you with an update on the latest news and events from Washington regarding the development of policies that could affect the soap and cosmetics industry in the future. On Thursday, April 18, FDA Commissioner Hamburg testified in front of the Senate Appropriations Committee regarding the FDA budget for the next fiscal year (FY 2014).
In the proposed budget submitted earlier this month by the President to the Congress, the Administration, just as they did last year, called for the establishment of new fees to be imposed on the cosmetics industry in order to stand up a more rigorous regulatory regime. It’s important to note that this is just a proposal at this point and has been introduced for the purposes of discussion. We are still a ways off from any new policies being seriously considered by the Congress, let alone enacted into law.
As you know, I, and other stakeholders from a wide spectrum of the cosmetics industry have been meeting with members of Congress and their staffs as well as the FDA to discuss any potential changes to the regulations impacting the industry and to make sure that the small businesses that make up our industry are protected as best they can be from potentially burdensome new rules and costs. While we’ve made a lot of progress, there is still work to do.
The President’s FY14 Budget proposes 21% increase over recently enacted levels to take care of all of the Food, Drug, Medical Device and Cosmetic industry. Of all of proposed new user fees, $19 million would come from a new mandatory and annual cosmetics user fee, to be to be paid by domestic and international cosmetics manufacturers. This is the second consecutive year FDA has proposed a cosmetics user fee. Congress took no action on the proposal last year. Any bill that affects the cosmetics industry should include small business exemptions from fees. That has been our message from the start and remains our clear and consistent message.
Currently, there is one bill in draft form that has not made it out of committee that would affect the cosmetics industry. It does contain small business exemptions. You can read the full draft of the bill here. This bill is still in committee. I will keep you posted if anything changes with the status of the proposed bill.
I know this is a lot of information, but I thought it was better to share more with you about what’s going on rather than have you not hear about it or not get the full story. Again, there’s a big distance between where we are now and any potential changes to regulations going into effect, but as you can see, the discussion is still open and it’s important that we remain vigilant to send the message that small business can and should be protected against any fees or burdensome regulatory paperwork requirements.