E8-13912. Importer of Controlled Substances; Notice of Registration

By Notice dated April 17, 2006 and published in the Federal Register on April 21, 2006, (71 FR 20729), and as corrected by Notice dated May 15, 2006, and published in the Federal Register on May 22, 2006, (71 FR 29354), Rhodes Technologies, 498 Washington Street, Coventry, Rhode Island 02816, made application to the Drug Enforcement Administration (DEA) to be registered as an importer of the basic classes of controlled substances in schedule II:

Drug	Schedule
Raw Opium (9600)	II
Concentrate of Poppy Straw (9670)	II

The company plans to import the basic classes of controlled substances to manufacture bulk active pharmaceutical ingredients. The company is registered with DEA as a manufacturer of several controlled substances that are manufactured from raw opium and concentrate of poppy straw.

Comments, objections, and requests for a hearing were received. However, after a thorough review of this matter DEA has concluded that, per 21 CFR 1301.34(a), the objectors are not entitled to a hearing. As explained in the Correction to Notice of Application dated January 18, 2007, pertaining to Rhodes Technologies et al., (72 FR 3417, January 25, 2007), comments and requests for hearings on applications to import narcotic raw material are not appropriate.

DEA has considered the factors in 21 U.S.C. 823(a) and 952(a) and determined that the registration of Rhodes Technologies to import the basic classes of controlled substances is consistent with the public interest and with United States obligations under international treaties, conventions, or protocols in effect on May 1, 1971. DEA investigated Rhodes Technologies to ensure that the company's registration would be consistent with the public interest. The investigation included inspection and testing of the company's physical security systems, verification of the company's compliance with state and local laws, and a review of the company's background and history. After investigating these and other matters, I have concluded that registering Rhodes Technologies to import raw opium and concentrate of poppy straw is consistent with the factors set forth in 21 U.S.C. 823(a)(2)-(6), as incorporated in 21 U.S.C. 958(a).

The DEA also considered whether the registration of Rhodes Technologies would be consistent with 21 U.S.C. 823(a)(1) that requires the DEA to limit the importation of certain controlled substances (including raw opium and concentrate of poppy straw) “to a number of establishments which can produce an adequate and uninterrupted supply of these substances under adequately competitive conditions * * *.” I find that the establishments currently registered with DEA to import raw opium and concentrate of poppy straw provide an adequate and uninterrupted supply of those substances. The DEA found no evidence that the supply of such substances was inadequate or interrupted in supplying the needs of the United States for legitimate medical, scientific, research, and industrial purposes.

However, I find that the adequate and uninterrupted supply of these substances did not occur under adequately competitive conditions. Specifically, I find that Rhodes Technologies has demonstrated that the current importers of raw opium and concentrate of poppy straw have, in some cases, refused to sell these substances to Rhodes Technologies. Some of the current importers also use their position to demand restrictive contractual terms when selling narcotic raw material to Rhodes Technologies. Many of the current importers also manufacture active pharmaceutical ingredients or have corporate ties to firms that manufacture active pharmaceutical ingredients from raw opium and concentrate of poppy straw. These importers have a direct financial interest in refusing to sell narcotic raw material to Rhodes Technologies or in demanding significant contractual restrictions when selling narcotic raw material to Rhodes Technologies.

Based on the information in the investigative file that is summarized herein, I find that the current importation of raw opium and concentrate of poppy straw is not being conducted under adequately competitive conditions. Therefore, under 21 U.S.C. 823(a)(1), DEA may grant the application of Rhodes Technologies to import raw opium and concentrate of poppy straw. Having already found that registering Rhodes Technologies to import raw opium and concentrate of poppy straw is consistent with the factors set forth in 21 U.S.C. 823(a)(2)-(6), I find that the statutory factor set forth in 21 U.S.C. 823(a)(1) also weighs in favor of granting the application.

Therefore, pursuant to 21 U.S.C. 952(a) and 958(a), and in accordance with 21 CFR 1301.34, the above named company is granted registration as an importer of the basic classes of controlled substances listed.

Dated: June 16, 2008.

Joseph T. Rannazzisi,

Deputy Assistant Administrator, Office of Diversion Control, Drug Enforcement Administration.