The LTO Application Process Is Now Streamlined
On 02 May 2016, the Food and Drug Administration (“FDA”) adopted a new application process and form for a License to operate (“LTO”). The application process is now navigable and accessible through the electronic portal found at the FDA website (www.fda.gov.ph).
The electronic process for LTO application has replaced the current Integrated Application Form (“IAF”) when applying for LTO as indicated in FDA Circular No. 2014-003, or otherwise known as Filing and Receiving of Registration, Licensing, and Other Authorizations Using the Integrated Application Form.
The use of the new application form and the corresponding procedures through the electronic portal (“e-portal”) facilitates application in terms of timelines and case of submission especially for applicants in the provinces or outside of Metro Manila.
Aligning with Republic Act No. 9485, or otherwise known as the Anti-Red Tape Act of 2007, this new process likewise ensures transparency, accountability and greater operational efficiency. The application is made easier and cost-effective.
Before going with the procedures, an establishment seeking to apply for a license to operate must first be able to determine the necessary documents that are required to be submitted.
What are the general documentary requirements for application of LTO as a Cosmetics/Drug /Medical Device / Food Manufacturer, Importer, or Distributor?
The documentary requirements for application of a LTO as a Cosmetics/Drug /Medical Device / Food Manufacturer, Importer, or Distributor are contained in Administrative Order No. 2016-003 (“Guidelines”).
Administrative Order 2016-003 sets the guidelines on a unified, harmonized and streamline licensing requirements of the FDA to hasten its approval process and strengthen its post-marketing surveillance activities. As provided in the Guidelines, the following are the documentary requirements in applying for a License to Operate as a Cosmetics/Drug /Medical Device / Food Manufacturer, Importer, or Distributor.
Accomplished Application Form and Declaration and Undertaking
Among other information, the application form shall contain the following:
- Declaration and undertaking of the responsibilities of the applicant as a condition for the processing and approval of the LTO;
- The location plan and global position system (GPS) coordinates of the establishment;
- The name of the qualified person and his credentials.
In case of medical device establishment, the qualified person is a Pharmacist or any other qualified professional and the relevant credentials are his Professional Regulation Commission (PRC) ID or any Proof of Qualification and Attendance to (medical device) Qualified Persons in Industry Regulatory Affairs (QPIRA). For medical device establishment, the names of the following personnel shall also be listed: Production Manager/Head, Quality Assurance Manager/Head, Quality Control Manager/Head.
In case of cosmetic establishment, the qualified person is a pharmacist or any other qualified professional and the relevant credentials are Professional Regulation Commission (PRC) ID or any Proof of Qualification and Attendance to Qualified Persons in Industry Regulatory Affairs (QPIRA). The names of the following personnel shall also be listed: For cosmetic establishment – Production Manager/Head, Quality Control and/or Assurance Manager/Head.
In case of food establishment, the qualified person is a Food Safety Compliance Officer or Regulatory Officer with the relevant credentials which are Certificate of Attendance to Appropriate FDA Licensing Seminar and Certificate of Attendance to Good Manufacturing Practice (GMP), Hazard Analysis and Critical Control Point (HACCP), or Food Safety Seminar. The names of the following personnel shall also be listed: For food manufacturer – Production Manager/Head, Quality Assurance Manager/Head, Quality Control Manager/Head, Food Safety Officer, and any designated senior tehnical personnel.
Proof of Business Name Registration
The business name/registration must be evidenced by copies of the following:
- For single proprietorship – Certificate of Business Registration issued by the Department of Trade and Industry (DTI);
- For corporation, partnership and other juridical person – Certificate of Registration issued by the Securities and Exchange Commission (SEC) and Articles of Incorporation;
- For cooperative – Certificate of Registration issued by the Cooperative Development Authority and Articles of Incorporation; or
- For government-owned or controlled corporation – the law creating the establishment, if with original charter, or its Certificate of Registration issued by the SEC and Articles of Incorporation, if without original charter.
The document must indicate the exact and complete address, e.g., unit number, floor, building, lot, block, phase, street, barangay, city/municipality, province, where applicable.
Site Master File (for manufacturers of drugs, devices and cosmetics)
As required by the applicable good manufacturing practice (GMP) for the type of establishment, the Site Master File must be submitted. Site Master File refers to a document prepared by the manufacturer, which contains specific information about the quality management policies and activities of the site, the production and/or quality control of manufacturing operations carried out at the named site and any closely integrated operations at adjacent and nearby buildings. It provides clear information on the manufacturer’s GMP related activities that are useful in general supervision and in the efficient planning and undertaking of GMP inspections.
Risk Management Plan (for manufacturers and distributors of drugs and medical devices establishments, and drugstores and Retail Outlet for Non-Prescription Drugs (RONPDs)
A general Risk Management Plan (RMP) for the establishment must be submitted. The RMP shall contain details on how to identify, characterize, prevent, or minimize risk relating to the products that the establishment is engage with. These shall include post-marketing surveillance activities and interventions to manage the risks.
Proof of payments (e.g., official receipt or authorized bank payment slip) must be attached to the application and trasnmitted to the FDA.
How are application fees paid?
Payment of prescribed fees as indicated in the Order of Payment may be done through the FDA Cashier, the bank (i.e., Landbank of the Philippines, Development Bank of the Philippines, Bancnet), or online thru Bancnet on the existing FDA issuance. Incomplete payment will not be accepted and the application will not proceed to the next step pf the process. An application for LTO is deemed filed upon submission of complete requirements including payment of required fees and charges.
The Evaluation Process
The evaluation of all applications for LTO shall be based on the veracity of the submitted documents and compliance with appropriate standards.
In case the applicant falsified, misrepresented material facts or documents, or withheld any material data or information, the application shall be disapproved. In such cases, the applicant may be investigated, appropriate charges may be filed, and penalties may be imposed. Should there be a need for clarification on the application, a notification, either written or thru email, shall be sent to the applicant.
The Inspection Process
Pre-opening inspection shall be mandatory for manufacturers. All covered establishments may be inspected at any time by FDA as part of its post-marketing surveillance activities.
Approval of the LTO
All approved LTO applications shall be sent through courier directly to the establishment’s owner, president, CEO, general manager or equivalent responsible officer as indicated in the application form.
All licensed manufacturers are granted an initial LTO based on the minimum requirements set by FDA in order to operate a manufacturing plant.
All covered establishments must continuously comply with the existing requirements, regulations and standards, otherwise they may be ordered closed or their licenses be suspended or revoked motu proprio, or upon petition by any affected person.
Cancellation of the License to Operate
Cancellation can either be automatic or voluntary. The LTO shall be automatically be cancelled and deleted from the list of licensed establishments by the FDA when existing establishments fail to file an application for renewal after one-hundred twenty (120) days from the date of expiration. This is without prejudice to their re-application. The LTO may be voluntarily cancelled by the owner or authorized person of a licensed establishment by filing a formal notification with the FDA.
When the license is cancelled whether automatically or voluntarily, the FDA shall retain jurisdiction over violations committed by the establishments while it was in operation. All establishments shall settle all their monetary obligations to FDA.
What are the penalties for operating without the required LTO?
The manufacture, importation, exportation, sale, offering for sale, distribution, transfer, or retail of any Cosmetics/Drug /Medical Device / Food by any natural or juridical person without the license to operate from the FDA is prohibited under RA 9711.
Accordingly, where there is finding of prohibited actions and determination of the persons liable thereto, after notice and hearing, the director-general of the FDA is empowered to impose one or more of the following administrative penalties:
1. Cancellation of the LTO which may have been granted by the FDA, or suspension of the validity thereof for such period of time as the director-general may deem reasonable which shall not exceed one (1) year;
2. A fine of not less than Fifty thousand pesos (P50,000.00) but not more than Five hundred thousand pesos (P500,000.00). An additional fine of not more than One thousand pesos (P1,000.00) shall be imposed for each day of continuing violation; and,
3. Destruction and/or appropriate disposition of the subject health product, and/or closure of the establishment for any violation of RA 9711, as determined by the director-general.
About Nicolas and De Vega Law Offices
If you need assistance in registration with the Food and Drug Administration, applications for Licenses to Operate, drug, cosmetic, medical device or food registration, registration of cosmetics, food supplements, licenses to operate or other applications with the Food and Drug Registration, or have issues in corporate law, commercial law, corporate or commercial litigation, or civil or other criminal law-related issues, we can help you. Nicolas and de Vega Law Offices is a full-service law firm in the Philippines. You may visit us at the 16th Flr., Suite 1607 AIC Burgundy Empire Tower, ADB Ave., Ortigas Center, 1605 Pasig City, Metro Manila, Philippines. You may also call us at +632 84706126, +632 84706130, +632 84016392 or e-mail us at [email protected]. Visit our website https://ndvlaw.com.