DEA Raises Registration Fees

By Larry K. Houck –

The Drug Enforcement Administration (“DEA”) has published a Final Rule increasing initial registration and renewal fees for all registrants.  77 Fed. Reg. 15,234 (Mar. 15, 2011).  DEA published the applicable Notice of Proposed Rulemaking (“NPRM”) on July 6, 2011, which was reported here on July 12, 2011.  76 Fed. Reg. 39,318 (July 6, 2011).

DEA has also posted several explanatory documents on the Diversion Control website at: www.deadiversion.usdoj.gov.  Documents posted on the website include a Registration Fees Fact Sheet, Letter to Registrants, Economic Impact Analysis, and New Fee Schedule Fee Calculations.

DEA stated that the increased fees are necessary to recover the full costs of Diversion Control program “so that it may continue to meet the programmatic responsibilities set forth by statute, Congress, and the President.”  Without the fee increases, DEA continued, the Diversion Control Program “will be unable to continue current operations, necessitating dramatic program reductions and possibly weakening the closed system of [controlled substance] distribution.”

The federal Controlled Substances Act (“CSA”) authorizes DEA “to charge reasonable fees relating to the registration and control of the manufacture, distribution, and dispensing of controlled substances and to listed chemicals.”  21 U.S.C. § 821.  DEA is required to set registration fees “at a level that ensures the recovery of the full costs of operating the various aspects of” the Diversion Control Program.  21 U.S.C. § 886a(1)(C).  Thus, DEA must set registration fees that are not only “reasonable” but also cover all costs of the Diversion Control Program.

DEA last increased registration fees in August 2006, setting those fees to cover the “full costs” of the Diversion Control Program for Fiscal Years 2006 through 2008.  DEA noted that total obligations for the Diversion Control Program increased by 49 percent from Fiscal Year 2007 to Fiscal Year 2010.

DEA cited a number of factors justifying the fee increase including:

• Expanding the use of Tactical Diversion Squads comprised of DEA diversion investigators and special agents, state and local law enforcement and regulatory officers conducting criminal investigations;
• Increased scheduled registrant investigations and inspections;
• Increased drug scheduling actions;
• Responding to the expanding number of synthetic substances such as synthetic cannabinoids and synthetic cathinones; and
• Establishing and maintaining information technology systems for registrants.

DEA used a weighted-ratio methodology to determine the reasonable fee for each category of registrant that needed to be collected during Fiscal Year 2012 through Fiscal Year 2014 to cover the costs of the Diversion Control Program then divided by the weighted number of estimated registrants.

DEA received 195 comments to the NPRM and responded to them in the Final Rule.  One registrant recommended that Diversion Control Program funds would be better used to provide for adequate staffing for Program functions involving quota requests, scheduling, and policy and regulatory interpretations to be more responsive to the regulated community.  DEA responded that it monitors and adjusts the number of employees assigned to different Program tasks that include responding to registrant inquiries.  DEA observed that it maintains a continuously updated robust website that is an information source for registrants.  DEA suggested that “[w]hile awaiting a response from” DEA, “registrants are encouraged to review the …website for information and guidance, and to seek assistance from their local DEA offices and state licensing bodies.”  It has been our experience that registrants typically seek guidance and information only after it is unavailable elsewhere.

DEA will begin collecting the increased fees on April 16, 2012.