NECC Award Letters Begin to Arrive

By Walter F. Roche Jr.

As promised, some victims of the 2012 fungal meningitis outbreak are beginning to receive notices that their claims have been approved.
The one-page letters from the National Settlement Administrator state the number of points the victim has been awarded and the estimated amount of an initial payment.
For instance, the survivors of a victim who died in the outbreak would be awarded 55 points and the estimated initial payment would be about $71,500.
The letters are going directly to claimants. For those who have an attorney involved in the claim, the lawyer will also get a copy.
The awards will come from a $200 million trust fund created under the bankruptcy of the New England Compounding Center, the Massachusetts firm blamed for the outbreak which sickened some 778 patients across the country, killing 76 of them.
"The initial payment," the letter states, "constitutes interim compensation. You may receive additional compensation after the claims process is completed and all appeals have been resolved."
Fredric Ellis, one of the attorneys on a plaintiffs' steering committee, said recently that the approval letters would be going to 1,350 victims or their survivors. Letters to those whose claims have been denied or reduced will be going out at a later date with an explanation of the appeals process.
As the letter explains, the approval does not mean that checks will be mailed immediately. Negotiations are still ongoing with officials of the Center for Medicare and Medicaid Services. CMS is attempting to recoup the amounts it paid for the medical care provided to  victims.
The letter states that efforts are aimed at obtaining a so-called global settlement. If that effort fails, each claim will have to be handled individually, a process that will take even longer.
The letter notes that some patients will also face liens from private insurance companies.
"If liens are required to be resolved on an individual basis, we will inform you and provide you with the name and contact information of a private lien resolution service who will work to resolve your liens if you so choose," the letter concludes.
Contact: wfrochejr999@gmail.com

NECC Criminal Trial Delayed Five Months

By Walter F. Roche Jr.

Amid a dispute over the review of thousands of internal emails, the trial of owners and employees of the defunct New England Compounding Center has been put off for five months till September of this year.
The delay came Wednesday in a status hearing on the criminal charges brought by a federal grand jury against former owners and employees of NECC, the Framingham, Mass. company blamed for a nationwide fungal meningitis outbreak that took the lives of 76 patients in 20 states.
U.S. District Judge Richard Stearns announced he would issue an order setting the new September date following a hearing in which attorneys for both sides presented arguments about the review of some 600,000 thousand pages of NECC internal emails which were seized in 2012 in a raid on the drug compounding firm's offices.
The trial had been scheduled to begin April 4 in Boston, Mass.
Christina Sterling, a spokeswoman for U.S. Attorney Carmen Ortiz, confirmed Wednesday that Stearns agreed to set an exact date for the trial in a coming order.
Federal prosecutors are appealing a magistrate judge's order that government screening teams quickly complete a review of the emails to determine if they contain privileged information. Defense lawyers also argued the emails could contain exculpatory information that would aid in the defense of their clients.
A federal grand jury handed up indictments of 14 former NECC employees and owners in December of 2014 with charges ranging from racketeering to mail and wire fraud to second degree murder.
State and federal regulators have concluded that NECC caused the 2012 fungal meningitis outbreak by shipping thousands of fungus riddled vials of steroid drugs earmarked for injection into the spines and joints of patients.
Overall some 778 patients were sickened, some suffering fatal strokes.
In separate legal proceedings a $200 million trust fund has been established for victims and some creditors of NECC.
Contact:wfrochejr999@gmail.com

New Notice at NECCSettlement.com

CLAIMS STATUS UPDATE (01/20/2016): Beginning this week, approximately 1350 determination letters will be sent out to Claimants (and their attorneys, if represented) granting approval of their claims in full. These determination letters will inform Claimants of the amount of the Points which have been allowed on their claims and the amount of the Initial Payments which will be made on their claims. It is expected that Claimants will receive a second payment after all claims are processed and any appeals from the Settlement Administrators’ final determinations have been resolved.
We do not yet know the timing of these Initial Payments as many claimants’ medical bills were paid by Medicare or private health insurance and these liens need to be resolved. For several months, the Plaintiffs Steering Committee has been in discussions with Medicare to resolve, on a global basis, all potential Medicare liens. Such a resolution would obviate the need to adhere to the Medicare reporting requirements for personal injury settlements and shorten the delay in making payments on approved claims. To date, no resolution has been achieved with Medicare. If no resolution is reached with Medicare, the Initial Payments will be delayed while Medicare reporting requirements are fulfilled and any resulting lien amounts are resolved on an individual basis. In the absence of a Medicare lien, there may also be a delay in making payments if there are private insurers that have asserted liens. If liens are required to be resolved on an individual basis, we will so notify claimants (and their counsel, if they are represented) and provide them with the name and contact information of a private lien resolution service who will work to resolve the lien(s), if the claimant so chooses.

Denial Letters Headed to Some 275 NECC Claimants

By Walter F. Roche Jr.

While some 1,350 victims of the 2012 fungal meningitis outbreak will be getting approval letters on their claims, some 275 other claimants will be getting notices that their claims have been denied in full.
According to Fredric Ellis, a Boston attorney representing victims, the denial letters are expected to be mailed during the week of Feb. 1. He added that those getting the denials will be given a chance to cure any deficiency or seek review under a separate category.
Those preliminary numbers come at the same time victims of the 2012 fatal outbreak are being told that before any distributions from a $200 million trust fund can be made, agreements must be reached with the U.S. Centers for Medicare and Medicaid Services and major insurance carriers who paid for victims medical care.
After the full denial letters are issued, Ellis said an estimated 450 letters will go out to victims who qualified for the basic distribution but who were denied upward adjustments for special circumstances.
Those claimants will also have an opportunity to appeal and cure any deficiencies.
Just when any funds will be distributed hinges on the negotiations with CMS and early indications for a quick resolution do not appear promising. According to sources familiar with the negotiations, the proposal from CMS could result in some victims losing more from their awards than the actual cost of their medical care.

A separate effort is underway to convince Health and Human Services Secretary Sylvia Burwell to simply waive any recovery payments. A letter from four U.S. Senators has been followed by similar letters from other members of congress.

Overall there were some 3,500 claims filed by patients who contend they were injected with fungus riddled injectable drugs produced by the defunct New England Compounding Center of Framingham, Mass.
The notices are the latest development in the aftermath of the 2012 fungal meningitis outbreak which sickened some 778 patients in more than 20 states, killing 76 of them.
The trust fund was established under a liquidation plan for NECC approved by a federal bankruptcy judge. Contributions to the fund came from NECC's former owners, insurance companies and other firms who provided services to NECC.
Awards to victims are based on the severity of their illnesses. Points, valued at a little under $1,300  apiece, will be allotted based on seven separate severity levels. Initial awards based on that $1,300 figure will be limited to about half of the total points each victim is entitled to. The balance will be paid at a later date.
Contact: wfrochejr999@gmail.com

Prosecutors Appeal Order on NECC Emails

By Walter F. Roche Jr.

Federal prosecutors are appealing a highly critical decision ordering them to complete a review of some 630,000 emails recovered from the defunct drug compounding firm blamed for a nationwide fungal meningitis outbreak.
The appeal, scheduled for a hearing next week, comes in the criminal case of the former owners and employees of the New England Compounding Center, the Framingham, Mass. firm which shipped thousands of fungus laden vials of an injectable steroid to health providers in more than 20 states.
In the six-page ruling now being appealed, Magistrate Judge Jennifer Boal strongly criticized federal prosecutors for failing to complete the review as ordered.
Citing the government's claim that it didn't have time to review the emails, Boal wrote, "this flies in the face of the government's characterization of the importance of this case as well as the number of agencies involved."
She noted that although the documents had been obtained under search warrants in 2012, government lawyers did not disclose until early November of last year that it had not completed the review and did not intend to do so.
Prosecutors had been ordered to review the emails to determine whether they contained any privileged information such as communications with attorneys. Some of those emails were then supposed to be turned over to lawyers for the defendants.
Boal in her decision flatly rejected claims by prosecutors that she lacked the authority to order the reviews be completed by a Dec. 10, 2015 deadline.
And, she added, that had the government wanted additional time it should have asked for it.
Instead, she wrote, "On December 3, 2015, approximately four months before the commencement of trial, the government announced that it was abandoning its longstanding discovery protocol in this case and foregoing review of the approximately 630,000 emails in its possession that were identified."
She noted that if there was any ambiguity in her order, it was effectively eliminated in a subsequent order from U.S. District Judge Richard G. Stearns. Stearns will hear arguments on the appeal Wednesday.
Boal also cited the argument of defense lawyers that they were entitled to the emails to find out if they contained any exculpatory evidence that would aid their clients.
As an example Stephen Weymouth, the attorney for defendant Glenn Chin, said that the emails could contain information showing that the defendants were concerned that outside consultants were not properly testing the drugs. Chin and former NECC owner Barry Cadden are facing the second degree murder charges.
In a brief supporting Boal's order, lawyers for the defendants charged that prosecutors' appeal was untimely and "the government indisputably failed to comply with its obligations."
 The 25-page defense brief also notes that prosecutors raised no objections to Boal's order in the 14-day period following its issuance.
The dispute comes as the scheduled April 4 trial date is fast approaching in the charges, ranging from second degree murder to  mail and wire fraud charges brought against 14 owners and employes of NECC.
State and federal regulators concluded that NECC shipped fungus ridden methylprednisolone acetate to health care providers in 2012. The drugs, which were supposed to be sterile, were injected into the spines and joints of thousands of patients.
The resulting fungal meningitis outbreak sickened 778 patients, killing 76 of them, federal court records show.
Contact: wfrochejr999@gmail.com

First Approval Letters Going to Outbreak Victims

By Walter F. Roche Jr.

Approval letters for some 1,350 victims of the deadly 2012 fungal meningitis outbreak will be going out in the mail this week and the claimants will learn for the first time what they are likely to receive as a preliminary award.
Fredric Ellis, a Boston lawyer representing victims, said the letters will include the number of points being awarded to each victim. He said the dollar value for each point will be slightly under $1,300.
The letters are the latest development in the aftermath of the 2012 fungal meningitis outbreak which sickened some 778 patients across the country, killing 76 of them.
The victims will be sharing in an estimated $200 million which was amassed in the bankruptcy of the New England Compounding Center, the company blamed for the outbreak. NECC shipped fungus laden steroids to health facilities where unsuspecting patients were then injected in spines and joints.
Ellis said just when victims can actually expect payments is not clear although he said it was possible it could happen in 90 days.
Ellis said the initial payments will be approximately one half of the amount victims can ultimately expect.
"We decided not to wait for everything to be resolved," Ellis said, adding that withholding half the money would provide a buffer. "This won't be the final payment."
Under the court approved allotment system (see below), victims will be awarded points based on the severity of their illnesses. For instance, the survivors of a victim who died in the outbreak would be awarded 55 points, while a patient who suffered fungal meningitis would be allotted 30 points.
Ellis said payments were being made in two installments because of a variety of factors, including the fact that some claims that were initially denied, could later be approved on appeal.
Yet another major factor is the ongoing negotiations with the federal government over how much of the awards will be earmarked to repay the Medicare program for the costs it incurred in paying for the medical care of victims.
Four U.S. senators have called on HHS Secretary Sylvia Burwell to waive any Medicare claims. So far there has been no response to their letter.

California Drug Compunder in Recall

Unexpired Sterile Human and Animal Compounded Products by Abbott's Compounding Pharmacy: Recall - Lack of Sterility Assurance

AUDIENCE: Patient, Pharmacy
ISSUE: Abbott's Compounding Pharmacy is voluntarily recalling all unexpired lots of sterile compounded products due to concerns of lack of sterility assurance. All unexpired lots are subject to the recall. These include injectable medications, sterile solutions, eye drops, and eye ointments. All recalled products were distributed to patients, physician offices and clinics, and veterinarians within California.
All recalled products have a label that includes the Abbott's Compounding Pharmacy name and expiration date. If unsure, Customers can call the pharmacy to determine the expiration date. This recall impacts all sterile products distributed between 01/01/2015 and 01/14/2016.
BACKGROUND: The recall was issued after a series of onsite inspections by the FDA. Out of an abundance of caution, Abbott's Compounding Pharmacy is voluntarily recalling all sterile compounded products within expiry. If there is microbial contamination in products intended to be sterile, patients are at risk for serious and potentially life-threatening infections. To date, Abbott's Compounding Pharmacy has not received any reports of any adverse effects or injuries, and the recalled products were distributed exclusively within the state of California directly from its Berkeley, California pharmacy location.
RECOMMENDATION: Customers that have recalled product should immediately stop using it and contact the pharmacy to arrange for the return of unused product. Customers should contact their physician or health care provider if they have experienced any problems that may be related to taking or using these products.
Customers with questions regarding this recall can contact Abbott's Compounding Pharmacy by phone Monday thru Friday, 9:00am to 5:00pm at (510) 548-8777, or email its media representative at tpark@capharmacylaw.com.
Healthcare professionals and patients are encouraged to report adverse events or side effects related to the use of these products to the FDA's MedWatch Safety Information and Adverse Event Reporting Program:
Complete and submit the report Online: www.fda.gov/MedWatc

Questions on Comments

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Additional Trustee's Fee Approved by Bankruptcy Judge

By Walter F. Roche Jr.

A federal bankruptcy judge today approved an additional $1.1 million in fees to the trustee who oversaw the liquidation of the drug company blamed for a fatal 2012 nationwide fungal meningitis outbreak.
In a 26-page decision U.S. Bankruptcy Judge Henry J. Boroff credited trustee Paul D. Moore with achieving the best possible result from the 2012 tragedy blamed on the defunct New England Compounding Center.
Under his decision Moore will collect a total of $2,271,509 million compared to the trimmed down $3.75 million he most recently requested. In his initial request, Moore had sought payment of $5.758 million
In the Friday decision Boroff noted that there was opposition to part of the fee request, but concluded that Moore's overall request was "less than the maximum compensation" allowed by law
In an earlier order Boroff approved payment to Moore of the $1,135,754 base amount that drew no opposition. He also approved in a prior order a $4.3 million payment to Moore's law firm, Duane Morris. Overall Moore and his firm will collect $6.5 million.
Thomas Sobol, who heads a committee representing victims and other creditors, had argued in a hearing late last year that Moore's fee should be limited to that base amount and that under the circumstances of the case, no bonus payment should be allowed.
Sobol said Friday that he was pleased that his arguments had brought about a reduction from Moore's request. He said he would have to confer with other committee members before making further comment.
In his decision Boroff did take pains to credit other parties with helping to contribute to the final liquidation plan which is expected to provide some $200 million to $210 million to victims and a limited number of creditors.
"It is obvious to this court that the efforts in this case truly did require a village," Boroff wrote.
But, he continued Moore's efforts came not only "in uncharted legal waters," but also involved "orchestrating myriad moving parts akin to building a Rube Goldberg machine piecemeal and out of order."
Citing the fact that NECC had only a little over $1 million in cash when the bankruptcy was filed, Boroff wrote, "In short the prospect of any meaningful recovery from NECC for the hundreds of thousands injured was bleak."
Citing the establishment of the trust fund, Boroff concluded that Moore's "work in this case has been exemplary."
The decision included a history of the case and a brief summary of the deadly fungal meningitis outbreak which sickened 778 patients across the country, killing 76 of them.
The trust fund created under the bankruptcy plan included payments from the owners of NECC, affiliated companies, insurance carriers and companies providing services to NECC. Boroff said in his decision that 90 percent of the total will go to victims.
The outbreak has been blamed on thousands of vials of fungus laden methylprednisolone acetate that were shipped by NECC to health providers in more than 20 states.
Contact:wfrochejr999@gmail.com

Judge Issues Mixed Rulings in Meningitis Cases

By Walter F. Roche Jr.

A federal judge Thursday ruled that health providers who injected patients with fungus tainted steroids will be able to use state laws in New Jersey and Tennessee to potentially limit their liability for the injuries, some of them fatal, those patients suffered.
In a nine-page written decision U.S. District Judge Rya Zobel ruled that Tennessee law will apply to hundreds of Tennessee victims and New Jersey law to victims in that state.
The cases stem from the 2012 fungal meningitis outbreak caused by a Massachusetts drug compounding firm which shipped thousands of vials of fungus tainted methylprednisolone acetate to health providers across the country. The outbreak sickened 778 patients, killing 76 of them.
Lawyers for the victims had argued that Massachusetts' liability statutes should apply, in part because the New England Compounding Center and its owners were located there.
But as Zobel's decision pointed out, under Massachsuetts law, the health care providers could be held liable for all of the damages suffered by each patient.
"Massachusetts allows joint and several liability," she wrote, allowing plaintiffs "to collect full damages" from a partially responsible defendant."
"Under Tennessee law," Zobel wrote, the defendants' liability is limited "to the percentage of damage caused by it."
Zobel noted the now defunct drug compounding firm and its owners were not parties in the cases now before her.
"The law of the state where the injuries occurred will apply absent compelling countervailing concerns," the ruling states.
Zobel issued a second ruling favorable to plaintiffs by denying a motion by health care providers to file a direct appeal to an appeals court on her decision to try the current cases in Boston, rather than Tennessee.
In another development Thursday attorneys for patients who were injected with NECC steroids at a Crossville, Tenn. clinic charged that a key document regarding what drugs the clinic was authorized to use, apparently went missing.
"This is a big deal," Gerard Stranch, a Nashville attorney, told U.S. Magistrate Jennifer C. Boal.
He was arguing in favor of a motion to force the Specialty Surgery Center to produce additional records relating to the clinic's drug formulary.
Stranch said further testimony and evidence was needed to determine if even more documents had "disappeared."
Chris Tardio, representing the clinic, told Boal that the testimony on the document was "much more equivocal" and there was no solid evidence it even existed.
"We feel it is unduly burdensome," Tardio said of the demand for further record searching.
Boal took the matter under advisement.
Contact: wfrochejr999@gmail.com

NECC Bankruptcy Judge Disallows Dozens of Claims

By Walter F. Roche Jr.

A federal bankruptcy judge Wednesday formally disallowed claims totaling more than $400 million in the case of the Massachusetts firm blamed for a fatal 2012 fungal meningitis outbreak.
In two separate orders U.S. Judge Henry J. Boroff approved the rejection of dozens of claims primarily from health care providers and insurance firms seeking to offset potential claims against themselves.
The disallowances were recommended by Paul D. Moore, who served as trustee for the bankruptcy and current holds the title of post confirmation officer.
Though the rejection of the claims was not unexpected, the judge's action formally removes them. Moore had reported earlier this week that no objections had been filed by a court approved deadline.
A compromise was reached with the Inspira Health Network and its insurance company.
Among the claims denied was a $240 million claim from the Specialty Surgery Center of Crossville, Tenn., one of the facilities where victims of the outbreak were injected with fungus ridden steroids from NECC.
Also rejected was a claim for $25 million from Donald Jones, a physician previously affiliated with that Tennessee clinic.
Other rejected claims include Blue Cross/Blue Shield affiliates in Michigan and Virginia, Neuromuscular and Rehabilitation Associates of Northern Michigan, the Orlando Center for Outpatient Surgery and Cincinnati Pain Management.
Victims of the outbreak and their survivors are still waiting for word on when they may begin receiving payments from a $200 million trust fund amassed by Moore from former owners of NECC, insurance companies and entities providing services to NECC.
The firm filed for bankruptcy on Dec. 21, 2012, about three months after the outbreak became public. NECC drugs have been blamed for sickening 778 patients across the country, killing 76 of them.

Q and A on Settlement Fund

http://www.neccsettlement.com/Home/FAQ

Major Drug Compounder In Recall

Recall: Firm Press Release

Pharmedium Issues Voluntary Nationwide Recall of 4mg Norepinephrine Bitartrate (16mcg/mL) Added to 0.9% Sodium Chloride in 250mL Viaflex Bag and 8mg Norepinephrine Bitartrate (32mcg/mL) Added to 0.9% Sodium Chloride in 250mL Viaflex Bag for Discoloration.

FDA posts press releases and other notices of recalls and market withdrawals from the firms involved as a service to consumers, the media, and other interested parties. FDA does not endorse either the product or the company.

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For Immediate Release

December 31, 2015

Contact

Consumers

Thomas Rasnic
 847-457-2256

Firm Press Release

Lake Forest, IL PharMEDium Services, LLC is voluntarily recalling 29 lots of 4mg Norepinephrine Bitartrate (16mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag and 3 lots of 8mg Norepinephrine Bitartrate (32mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag distributed to hospital customers. We have received complaints from hospitals for products that have been found to exhibit a slight discoloration in the admixture. The drug manufacturer's prescribing information advises not to use the product if it is discolored.
Discoloration is indicative of degradation and could result in decreased potency due to oxidation of Norepinephrine Bitartrate. Decreased potency may result in a delay of achieving desired therapeutic effect. PharMEDium Services has not received any reports of adverse events to date related to this recall.
The product is used for blood pressure control in certain acute hypotensive states and is packaged in a 250 mL Viaflex Bag. The affected 4mg Norepinephrine Bitartrate (16mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag and 8mg Norepinephrine Bitartrate (32mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag include the following lot numbers and expiration dates:

2K6134
Lot#	Expiration Date
15342084S	2/10/2016
15342191S	2/10/2016
15342223S	2/10/2016
15342224S	2/10/2016
15342225S	2/10/2016
15342226S	2/10/2016
15343025S	2/11/2016
15343026S	2/11/2016
15343129S	2/11/2016
15343131S	2/11/2016
15344157S	2/12/2016
15344160S	2/12/2016
15344209S	2/12/2016
15345036S	2/13/2016
15345104S	2/13/2016
15345106S	2/13/2016
15345142S	2/13/2016
15346015S	2/14/2016
15346016S	2/14/2016
15346017S	2/14/2016
15346018S	2/14/2016
15346019S	2/14/2016
15346020S	2/14/2016
15346022S	2/14/2016
15346023S	2/14/2016
15348152S	2/16/2016
15348197S	2/16/2016
15350046S	2/18/2016
15350154S	2/18/2016

2K6127
Lot#	Expiration Date
15342123S	2/10/2016
15349071S	2/10/2016
15351050S	2/10/2016

The product can be identified by PharMEDium Services Code 2K6134 (NDC Number 61553-134-61) 4mg Norepinephrine Bitartrate (16mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag or 2K6127 (NDC 61553-127-61) 8mg Norepinephrine Bitartrate (32mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag
On December 22, 2015, PharMEDium Services e-mailed notification to all affected customers and requested quarantine and destruction. Replacement of all recalled products is available.
Hospital pharmacies that have the recalled 4mg Norepinephrine Bitartrate (16mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag and 8mg Norepinephrine Bitartrate (32mcg/mL) added to 0.9% Sodium Chloride in 250mL Viaflex Bag in stock should stop using and discard per the hospital destruction policy. Hospitals that may have shared these products with other hospitals should contact those hospitals that received the products.
Hospitals or other healthcare providers with questions regarding this recall can contact PharMEDium Services by calling 847-457-2244 or email at quality1@pharmedium.com Monday through Friday, 8:00 AM to 5:00 PM, Central Standard Time. Patients should contact their physician or healthcare provider if they have experienced any problems that may be related to taking or using this drug product.
Adverse reactions or quality problems experienced with the use of this product may be reported to the FDA's MedWatch Adverse Event Reporting program either online, by regular mail or by fax.
Complete and submit the report Online: www.fda.gov/medwatch/report.htm
Regular Mail or Fax: Download form www.fda.gov/MedWatch/getforms.htm or call 1-800-332-1088 to request a reporting form, then complete and return to the address on the pre-addressed form, or submit by fax to 1-800-FDA-0178.
This recall is being conducted with the knowledge of the U.S. Food and Drug Administration.

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