Regulatory Impact Analysis for the Regulation of Microbial Products of Biotechnology Appendix H: Cost Memoranda for Determining EPA Per Submission Reporting Costs and EPA's Review Process

This appendix provides memoranda used to calculate the EPA costs. The six sections are:

The Costs to EPA of Maintaining the BSAC;

Overview of EPA's review process;

Derivation of FTE Estimates for Calculating EPA Costs of the Rule;

Revised estimates by the Exposure Evaluation Division for hours to review biotechnology submissions;

Revised estimates by the Information Management Division for man-hour estimates for various biotech submissions review;

Revised division hour estimates per submission type.

Memorandum on Costs to EPA of Maintaining the BSAC

Memorandum Costs to EPA of Maintaining the BSAC--Continued

EPA's Review Process

EPA's review process is based on the new chemicals program currently in place under Section 5 of TSCA. This analysis assumes that some elements of the review of microorganisms can be expected to take approximately the same time as comparable elements of the chemical review process.

It was more difficult to estimate the time requirements for other elements of the review for microorganism uses such as the development of monitoring protocol for releases by the environmental effects personnel. Aspects of the review that are extensions of what is currently done when reviewing chemical submissions include receiving submissions and placing them into review, and conducting a literature search.

For a MCAN and a TERA the reviews will be similar in many respects. However, TERA reviews are expected to be completed more rapidly. Figure H-1 depicts the stages of EPA's review process. In the initial technical assessment the submission receives a cursory check for completeness. Upon establishing that the submission is complete a literature search is performed for the microorganism. Any information pertaining to the microorganism and its use is collected. An initial review entails an assessment by a chemical engineer of the production process to determine the level of containment in place, and the potential for occupational or consumer exposure.

A health effects and fate review also is initiated immediately upon receipt of the submission. A toxicologist examines data on the microbial product for any potential harm to human health. Environmental scientists work with the release and site information provided by the engineer and in the submission to assess any detrimental effects to the environment for TERA submissions and MCANs. The initial review also serves to identify areas of uncertainty regarding the microorganism and any data deficiencies.

Figure H-1. EPA's Review Process

The initial managerial review that follows the technical assessment provides the individual reviewers guidance across the technical aspects of the case. This initial review also establishes the level of effort that will be necessary to complete the review. For example, at this point EPA will decide if a site visit is necessary or if a BSAC subcommittee's assistance will be needed.

The individual assessors continue their reviews and complete their reports. An economic review begins that identifies benefits to the firm and society, projects the possible market that the microbial product will penetrate, and identifies substitutes for purpose of evaluating relative riskissues. The entire package is then integrated for final management review andapproval. Approval can be granted outright or may be conditional upon EPA's receiving more data, and/or upon a legally binding agreement to undertake specific precautions or procedures.

The above described scheme will be the basic process for most of the submissions the Agency receives. Although the process is similar, there are differences in review time and emphasis for each submission type and microorganism class. The more familiar the Agency is with the microorganism and its use, the less review time needed. Finally, review time per case will differ based on whether or not an extensive environmental fate analysis must be performed. Review time also is likely to decrease, as the Agency gains experience and greater knowledge of microorganisms and their effects.

Division Hour Estimates Year 1

^a The addition of extramural costs of $1,250 for Year 1 and $938 for Year 5 is shown in Table V-3.

^b It is assumed that the review time for Year 5 submissions represents a 25 percent decrease from review time for Year 1 submissions.