The AGM is not the only thing I am looking forward to on October 25. It appears that the FDA's legislated requirement to make effective its final sunscreen monograph by November 26 2019 may be published 30 days in advance by October 25.
A recap: On February 26, FDA published the proposed rule, “Sunscreen Drug Products for Over-the-Counter Human Use,” which describes the conditions under which Over-the-Counter (OTC) sunscreen monograph products are generally recognized as safe and effective (GRASE).
Under the Sunscreen Innovation Act (SIA), 21 USC 360-fff-5, FDA is required by law to finalize and make effective the sunscreens final monograph by November 26, 2019.
Under the Administrative Procedure Act, 5 USC 553(d), a rule generally cannot become effective until at least 30 days after publication, which means that FDA should publish the final rule by October 25.
The proposed rule states that there is still not enough evidence to determine the GRASE status of most of the ingredients from the stayed 1999 final sunscreens rule.
FDA proposes that two sunscreen ingredients are GRASE (Category I) and two are not GRASE (Category II). The ingredients proposed for Category I are zinc oxide and titanium dioxide. The ingredients proposed for Category II, based on safety concerns, are para-aminobenzoic acid (PABA) and trolamine salicylate.
For the remaining twelve ingredients from the stayed 1999 sunscreens rule, FDA is seeking more information (Category III), based in part on concerns about the lack of data characterizing their absorption or, in the case of oxybenzone, concerns about the effect of absorption. The twelve ingredients are: cinoxate, dioxybenzone, esulizone, homosalate, meradimate, octinoxate, octisalate, octocrylene, padimate O, sulisobenzone, oxybenzone, and avobenzone. Many of these ingredients are in sunscreens that are currently marketed in the U.S. The data gaps that FDA has identified for these products are significant and are not likely to be resolved before FDA finalizes this rule as required by the statutory deadline. When FDA publishes the final sunscreen rule the agency will have two choices for each of these Category III ingredients: FDA can either (1) determine that the ingredients are not GRASE, which will require an NDA for continued marketing, or (2) defer rulemaking for these ingredients to allow the necessary research to be conducted, submitted, and evaluated.
The proposed rule states that any requests for the deferral of rulemaking must be submitted within the 90-day comment period (by May 28, 2019). Data submitted in such “timely and complete” deferral requests will be reviewed along with data and information already in the docket. “FDA will determine whether the sum of the data, if timely submitted, is likely to be adequate to provide all the data that are necessary to make a determination of general recognition of safety and effectiveness.” 84 FR 6204, 6249 (Feb. 26, 2019). This language in the proposed rule implies that even if a deferral request is submitted within the deadline, FDA may decide not to grant a deferral for certain ingredients for which FDA believes the data are unlikely to be adequate. Products containing these ingredients would need to be reformulated or come off the market.
If FDA decides not to grant deferrals for all twelve of these ingredients, the U.S. market would be cleared of chemical sunscreens, and only result in two mineral-based options.
In addition, the body of scientific evidence linking UVA exposure to skin cancers and other harms has grown significantly in recent years. To address this concern, FDA is proposing:
• To require that all sunscreens with SPF values of 15 and above satisfy broad spectrum requirements.
• To add a requirement to the current broad spectrum test to ensure that as SPF increases, broad spectrum
protection also increases, and that broad spectrum products provide adequate protection against UVA.
These changes are excellent news for ANO's ZinClear in particular, which exceeds these critical wavelength requirements, unlike potentially other competing products.
And lastly, the one I am most excited about.
Even if FDA does not ban any chemical filters, and chemical companies band together and are able to produce sufficient data to allow GRASE status for several of the chemical ingredients, the FDA is proposing that all active ingredients are to be listed in alphabetical order on the front of all sunscreen packaging.
This means, brands will have the choice of having something 4 long, awful sounding chemical names on the front of their packaging to scare away their customers, or one, mineral ingredient like zinc oxide. I know which I'd want!
All of these regulatory changes provide significant upside for the zinc oxide market, as brand owners will continue to feel nervous about the market risk of using chemical ingredients over mineral zinc oxide.
In addition, consumers will continue to hear via the media about the concerns, and safety testing being undertaken on chemical products and continue to shift to zinc oxide based sunscreens, regardless of how brand owners respond.
There is nothing but significant upside in this business to look forward to. Hold on to your hats.
ANO Price at posting:
$6.40 Sentiment: Buy Disclosure: Held
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