Kristina Partsinevelos, from FOX Business, reports on how the alcohol industry and small artisanal distilleries are being hit by the coronavirus outbreak and the potential price increase next year.
Distilleries that manufactured hand sanitizer in the midst of a shortage earlier this year were shocked to learn this week that the Food and Drug Administration (FDA) was charging a $ 14,060 fee, but in a reversal on Thursday night, the Department of Health and Human Services has ordered the FDA to cease application of the fees.
“Small businesses that came forward to fight COVID-19 should be applauded by their government, not taxed for it,” said HHS team leader Brian Harrison in a statement. declaration.
“I am pleased to announce that we have instructed the FDA to cease the application of these arbitrary and unexpected fees to the user. Happy New Year, distilleries and a toast to you for helping to keep us safe!”
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Workers bottle hand sanitizer produced by J. Rieger and Co., a distillery in Kansas City, Missouri, March 20. People waited up to two hours to buy the disinfectant, made from overproof gin, in response to the coronavirus pandemic. (AP Photo / Charlie Riedel)
The coronavirus pandemic caused a shortage of hand sanitizer earlier this year, so hundreds of distilleries across the country stepped up and transitioned their production lines to hand sanitizer to fill in the gaps.
But on Tuesday, the FDA announced that these companies must pay a fee of $ 14,060 to make the hand sanitizer according to a recently launched “OTC Drug User Fee Monograph Program”, which was established by the Coronavirus Aid, Relief, and Economic Security (CARE) Take action in March.
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“This unexpected fee serves to punish distilleries that were already struggling and who acted in a time of need to do the right thing,” said Chris Swonger, chairman and CEO of spirits spirits, before the reversal.
An FDA spokesman told Fox News on Thursday that these “user fees will provide additional resources to help the agency conduct our important regulatory activities in a more timely manner and, ultimately, to help provide the public with access to innovative OTC monographic medicines. “
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But distillery owners couldn’t believe the surprise rate after an already difficult year that hurt financial results.
“After all this, do you come to us and say that we owe you money? And is it the same for people who made hundreds of thousands of bottles and for people who made 100? There are small distilleries that haven’t even generated $ 15,000 in revenue this year, “Jason Barrett, owner of Black Button Distilling in New York, told WXXI.
Constance McDonough of Fox News contributed to this report.