Distillers That Came to Rescue by Brewing Hand Sanitizer Got Nasty Surprise from FDA
In the early days of the coronavirus pandemic, the country turned to traditional alcohol distillers to quickly produce and distribute hand sanitizer, as companies that were already producing it couldn’t keep up with the demand.
This past week, those distillers learned about a surprise bill they would have to pay, courtesy of the federal government.
It was certainly no way to say thanks to the more than 800 companies who made themselves a link in a broken supply chain. The bureaucracy, though, is blind, and so the distilleries found out they’d have to fork over thousands of dollars in fees by mid-February.
Thankfully, common sense has prevailed, and those who used their resources, time and money for public service won’t have to pay for being good stewards.
Earlier this week, distilleries learned from the Food and Drug Administration they’d have to pay at least $14,060 each for producing the hand sanitizer. That’s thanks to a provision from the CARES Act which classified distillers who had made the disinfectant as “over-the-counter drug monograph facilities,” Reason reported.
“At issue is a provision of the CARES Act that reformed regulation of non-prescription drugs. Under the revised law, distilleries that produced sanitizer have been classified as ‘over-the-counter drug monograph facilities.’ The CARES Act also enacted user fees on these facilities to fund the FDA’s regulatory activities. For small distillers, that means ending the year with a surprise bill for $14,060,” the outlet noted.
According to the Distilled Spirits Council of the United States, an additional $9,373 Contract Manufacturing Organization Facility Fee would have affected distilleries as well.
The fees made a spectacle of public service and civic duty.
Aaron Bergh, the owner of Calwise Spirits in Paso Robles, California, was among those who reconfigured his entire operation to meet public demand. He told The San Joaquin Valley Sun he quickly registered as a “monograph drug facility” with the FDA. Instead of focusing primarily on the gins, rums vodkas and whiskeys he was used to making, he found himself producing ethanol hand sanitizer.
“At the beginning of the pandemic the FDA and our communities called out for help and distillers enthusiastically stepped up to the plate and provided an essential product to medical workers and first responders,” Bergh told the newspaper Wednesday.
“It’s apparent the FDA has decided they don’t need us anymore and it’s in their best interest to suck us dry when we’re already struggling during the pandemic’s business closures,” he added.
The man’s business has been hit hard by California’s draconian mandates. Then the FDA fee hit him like a ton of bricks, and threatened to take his and other distillers’ profits for the year.
“Even if you created only a few gallons or donated all of it, you’re on the hook for $14,000,” Bergh said.
“No good deed goes unpunished.”
Thankfully, according to the Department of Health and Human Services, the fees will be waived, with HHS Chief of Staff Brian Harrison announcing Thursday the good deeds would not, in fact, be punished.
“Small businesses who stepped up to fight COVID-19 should be applauded by their government, not taxed for doing so,” Harrison said in a statement released by the HHS Office of Public Affairs Twitter account.
“I’m pleased to announce we have directed FDA to cease enforcement of these arbitrary, surprise user fees. Happy New Year, distilleries, and cheers to you for helping keep us safe!” Harrison added.
“I’m pleased to announce we have directed FDA to cease enforcement of these arbitrary, surprise user fees. Happy New Year, distilleries, and cheers to you for helping keep us safe!” (2/2)
— HHS Office of Public Affairs (@SpoxHHS) December 31, 2020
How thoughtful of the federal government to pivot to not punishing private citizens for filling crucial supply chain gaps which were, at the time, of great consequence to Americans who were fearful of a novel virus which nobody knew anything about.
Small businesses are the lifeblood of the American economy. The fact that these heroes even had to sweat over paying for their service is a tragedy in and of itself.
But if there is one silver lining here, it’s that the FDA potentially showed many people who might have been on the fence that big government is and always has been a scourge to avoid.
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