United State? Z:-" •^::':;f:
                    Environmenfel Protection"
                    Agency  "   rs;™ •.•;••>.-(:•••*•:•:.•
Enforcement And
Compliance" Assurance
(2223A)   "t".-/;  '
EPA310-R-97-6p5
September 1997



SECTOR
NOTEBOOKS
                   :EFV\ Qffice Of Compliance Sector Notebook Project

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                 UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
       *                       WASHINGTON, D.C. 20460
                                     NOV f 0  1997
                                                                         THE ADMINISTRATOR
Message from the Administrator

Since EPA's founding over 25 years ago, our nation has made tremendous progress in protecting
public health and our environment while promoting economic prosperity. Businesses as large as
iron and steel plants and those as small as the dry cleaner on the corner have worked with EPA to
find ways to operate cleaner, cheaper and smarter.  As a result, we no longer have rivers catching
fire. Our skies are clearer. American environmental technology and expertise are in demand
around the world.

The Clinton Administration recognizes that to continue this progress, we must move beyond the
pollutant-by-pollutant approaches of the past to comprehensive, facility-wide approaches for the
future. Industry by industry and community by community, we must build a new generation of
environmental protection.

The Environmental Protection Agency has undertaken its Sector Notebook Project to compile,
for major industries, information about environmental problems and solutions, case studies and
tips about complying with regulations. We called on industry leaders, state regulators, and EPA
staff with many years of experience in these industries and with their unique environmental issues.
Together with an extensive series covering other industries, the notebook you hold in your hand is
the result.

These notebooks will help business managers to understand better their regulatory requirements,
and learn more about how others in their industry have achieved regulatory compliance and the
innovative methods some have found to prevent pollution in the first instance. These notebooks
will give useful information to state regulatory agencies moving toward industry-based programs.
Across EPA we will use this manual to better integrate our programs and improve our compliance
assistance efforts.

I encourage you to use this notebook to evaluate and improve the way that we together achieve
our important environmental protection goals.  I am confident that these notebooks will help us to
move forward in ensuring that — in industry after industry, community after community ~
environmental protection and economic prosperity go hap4 in hand.          """"'
                                               _
                                               Carol M. Browner
            RtcycUd/R*cycl*bl» • Printed with Vegetable OH Based Inks on 100% Recycled Paper (40% Postconsumer)

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Sector Notebook Project
Pharmaceutical Industry
                                                              EPA/310-R-97-005
             EPA Office of Compliance Sector Notebook Project:

    Profile of the Pharmaceutical Manufacturing Industry
                                September 1997
                           For sale by the U.S. Government Printing Office
                    Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328
                               ISBN 0-16-049397-8
                              Office of Compliance
                  Office of Enforcement and Compliance Assurance
                       U.S. Environmental Protection Agency
                          401 M St., SW (MC 2221-A)
                             Washington, DC 20460

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Page iv intentionally left blank.

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Sector Notebook Project
Pharmaceutical Industry
                                Table of Contents

List of Tables	vii

List of Figures	 viii

List of Acronyms	 ix

I. INTRODUCTION TO THE SECTOR NOTEBOOK PROJECT	1
      A. Summary of the Sector Notebook Project	1
      B. Additional Information  	2

II. INTRODUCTION TO THE PHARMACEUTICAL INDUSTRY	3
      A. Introduction, Background, and Scope of the Notebook	3
      B. Characterization of the Pharmaceutical Industry	3
             1. Product Characterization  	5
             2. Industry Size 	6
             3. Geographic Distribution	11
             4. Economic Trends and International Competition	13

III. INDUSTRIAL PROCESS DESCRIPTION	17
      A. Industrial Processes in the Pharmaceutical Industry	17
             1.  Research and Development	17
             2.  Production of Bulk Pharmaceutical Substances  	19
             3.  Formulation, Mixing, and Compounding 	32
      B. Raw Material Inputs and Pollutant Outputs	38
             1. Raw Materials 	40
             2. Air Emissions and Control Systems	43
             3. Wastewater  	46
             4. Solid Wastes	50
      C. Management of TRI Chemicals in the Production Process	51

IV. CHEMICAL RELEASE AND TRANSFER PROFILE	53
      A. EPA Toxic Release Inventory for the Pharmaceutical Industry	57
      B. Summary of Selected Chemicals Released	68
      C. Other Data Sources	72
      D. Comparison of Toxic Release Inventory Among Selected Industries 	74

V. POLLUTION PREVENTION OPPORTUNITIES	77
      A. Material Substitutions	79
      B. Process Modifications	83
      C. Good Operating Practices  	87
      D. Recycling, Recovery, and Reuse  	90
      E. Pollution Prevention Research	92
Sector Notebook Project
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Sector Notebook Project	      Pharmaceutical Industry

VI. SUMMARY OF APPLICABLE FEDERAL STATUTES AND REGULATIONS  	93
      A. General Description of Major Statutes	93
      B. Industry Specific Requirements	105
      C. Pending and Proposed Regulatory Requirements	110
      D. Other Federal Regulations Affecting the Pharmaceutical Industry  	Ill
      E. Other Statutes and Regulations Affecting the Pharmaceutical Industry	114

VII, COMPLIANCE AND ENFORCEMENT HISTORY	117
      A. Pharmaceutical Industry Compliance History	121
      B. Comparison of Enforcement Activity Between Selected Industries	123
      C. Review of Major Legal Actions	128
             1. Review of Major Cases	128
             2. Supplementary Environmental Projects (SEPs)	129

VIII. COMPLIANCE ACTIVITIES AND INITIATIVES	131
      A. Sector-related Programs and Activities  	131
      B. EPA Voluntary Programs  	131
      C. Trade Association/Industry Sponsored Activity	138
             1. Environmental Programs	138
             2. Summary of Trade Associations	140

IX. CONTACTS/ACKNOWLEDGMENTS/REFERENCES	143

Appendix A: Instructions for downloading this notebook	A-l
 Sector Notebook Project                   vi                          September 1997

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Sector Notebook Project
                     Pharmaceutical Industry
                                    List of Tables

Table 1: Summary Statistics for the Pharmaceutical Industry	8
Table 2: Pharmaceutical Industry (SIC 283) Facility Size	,	10
Table 3: Employment Size Distribution for Medicinals and Botanicals and Pharmaceutical
       Preparations Establishments	10
Table 4: Top U.S. Pharmaceutical Companies by Sales  	11
Table 5: Examples of Pharmaceutical Products by Bulk Manufacturing Process	20
Table 6: Pharmaceutical Dosage Forms	34
Table 7: Summary of Typical Material  Inputs and Pollution Outputs in the Pharmaceutical
       Industry	39
Table 8: Solvents Used in the Chemical Synthesis Process	41
Table 9: Solvents Used in Biological and Natural Product Extraction	42
Table 10: Solvents Used in Fermentation Processes	 42
Table 11: Chemicals Discharged in Wastewater by the Pharmaceutical Manufacturing Industry 48
Table 12: Wastewater Treatment Technology Trends  	49
Table 13: Source Reduction and Recycling Activity for the Pharmaceuticals Industry  	52
Table 14: 1995 Releases for Pharmaceutical Facilities (SIC 2833 & 2834) in TRI  	58
Table 15: 1995 Transfers for Pharmaceutical Facilities (SICs 2833 & 2834) in TRI	62
Table 16: Top 10 TRI Releasing Pharmaceutical Manufacturing Facilities  	66
Table 17: Top 10 TRI Releasing Facilities Reporting Pharmaceutical
       Manufacturing  SIC Codes to TRI	67
Table 18: Air Pollutant Releases by Industry Sector (tons/year)	73
Table 19: Toxics Release Inventory Data for Selected Industries	76
Table 20: Five-Year Enforcement and Compliance Summary for the Pharmaceutical Industry 121
Table 21: Five-Year Enforcement and Compliance Summary for Selected Industries	124
Table 22: One-Year Enforcement and Compliance Summary for Selected Industries 	125
Table 23: Five-Year Inspection and Enforcement Summary by Statute for Selected Industries 126
Table 24: One-Year Inspection and Enforcement Summary by Statute for Selected Industries 127
Table 25: Pharmaceutical Industry Participation in the 33/50 Program	133
Sector Notebook Project
vu
September 1997

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Sector Notebook Project	Pharmaceutical Industry

                                   List of Figures

Figure 1: Percent of Total Value of Shipments by Sector	8
Figure 2: Employment in-the Pharmaceutical Industry 	9
Figure 3: Geographic Distribution of Pharmaceutical Facilities (SIC 2833 and 2834)	11
Figure 4: World Sales of Pharmaceuticals, 1995	14
Figure 5: Simplified Process Flow Diagram for Chemical  Synthesis	22
Figure 6: Typical Design of a Kettle-Type Batch Reactor	23
Figure 7: Cross-Section of Typical Top-Suspended Centrifugal Filter  	25
Figure 8: Cross-Section of Typical Tumble Dryer  	27
Figure 9: Simplified Process Flow Diagram for Natural/Biological Extraction  	29
Figure 10: Simplified Process Flow Diagram for the Fermentation Process	30
Figure 11: Simplified Process Flow Diagram for Compounding and Formulating	32
Figure 12: Summary of TRI Releases and Transfers by Industry	75
 Sector Notebook Project                   viii                           September 1997

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 Sector Notebook Project
                    Pharmaceutical Industry
                                  List of Acronyms

 AFS -       AIRS Facility Subsystem (CAA database)
 AIRS -      Aerometric Information Retrieval System (CAA database)
 BEFs -      Boilers and Industrial Furnaces (RCRA)
 BOD -      Biochemical Oxygen Demand
 CAA -      Clean Air Act
 CAAA -     Clean Air Act Amendments of 1990
 CDER -     Center for Drug Evaluation and Research
 CERCLA -  Comprehensive Environmental Response, Compensation and Liability Act
 CERCLIS -  CERCLA Information System
 CFCs -      Chlorofluorocarbons
 CO -        Carbon Monoxide
 COD -      Chemical Oxygen Demand
 CSI -       Common Sense Initiative
 CTM -      Clinical Trial Material
 CWA -      Clean Water Act
 D&B -      Dun and Bradstreet Marketing Index
 ELP -       Environmental Leadership Program
 EPA -       United States Environmental Protection Agency
 EPCRA -    Emergency Planning and Community Right-to-Know Act
 FDA -      Food and Drug Administration
 FIFRA -     Federal Insecticide, Fungicide, and Rodenticide Act
 FINDS -     Facility Indexing System
 HAPs -      Hazardous Air Pollutants (CAA)
 HSDB -     Hazardous Substances Data Bank
 IDEA -      Integrated Data for Enforcement Analysis
 IND -       Investigational New Drug
 LDR -      Land Disposal Restrictions (RCRA)
 LEPCs -     Local Emergency Planning Committees
 MACT -     Maximum Achievable Control Technology (CAA)
 MCLGs -    Maximum Contaminant Level Goals
 MCLs -      Maximum Contaminant Levels
 MEK -      Methyl Ethyl Ketone
 MSDSs -    Material  Safety Data Sheets
 NAAQS -   National  Ambient Air Quality Standards (CAA)
 NAFTA -    North American Free Trade Agreement
 NAICS -     North American Industrial Classification System
 NCDB -     National  Compliance Database (for TSCA, FIFRA, EPCRA)
 NCP -       National  Oil and Hazardous Substances Pollution Contingency Plan
NDA -      New Drug Application
NEIC -      National  Enforcement Investigation Center
NESHAP -   National  Emission Standards for Hazardous Air Pollutants
NO2 -       Nitrogen Dioxide
NOV-      Notice of Violation
NOX -       Nitrogen Oxides
Sector Notebook Project
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September 1997

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Sector Notebook Project
                  Pharmaceutical Industry
NPDES -   National Pollution Discharge Elimination System (CWA)
NPL -      National Priorities List
NRC -      National Response Center
NSPS -     New Source Performance Standards (CAA)
OAR-      Office of Air and Radiation
OECA -    Office of Enforcement and Compliance Assurance
OPA -      Oil Pollution Act
OPPTS -   Office of Prevention, Pesticides, and Toxic Substances
OSHA -    Occupational Safety and Health Administration
OSW -     Office of Solid Waste
OSWER -  Office of Solid Waste and Emergency Response
OW -      Office of Water
P2 -       Pollution Prevention
PCS -      Permit Compliance System (CWA Database)
PhRMA -   Pharmaceutical Research and Manufacturers of America
POTW -   Publicly Owned  Treatments Works
RCRA -    Resource Conservation and Recovery Act
RCRIS -   RCRA Information System
SARA -    Superfund Amendments and Reauthorization Act
SDWA -   Safe Drinking Water Act
SEPs -     Supplementary Environmental Projects
SERCs -   State Emergency Response Commissions
SIC -      Standard Industrial Classification
SO2 -      Sulfur Dioxide
SOX -      Sulfur Oxides
TOC -      Total Organic Carbon
TRI -      Toxic Release Inventory
TRIS -     Toxic Release Inventory System
TCRIS -   Toxic Chemical  Release Inventory System
TSCA -    Toxic Substances Control Act
TSS -      Total Suspended Solids
UIC -      Underground Injection Control (SDWA)
UST -      Underground Storage Tanks (RCRA)
VOCs -    Volatile Organic Compounds
 Sector Notebook Project
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September 1997

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Pharmaceutical Industry
Sector Notebook Project
I. INTRODUCTION TO THE SECTOR NOTEBOOK PROJECT

LA. Summary of the Sector Notebook Project

                     Integrated environmental policies based upon comprehensive analysis of air,
                     water and land pollution are a logical supplement to traditional single-media
                     approaches to environmental protection. Environmental regulatory agencies
                     are beginning to embrace comprehensive, multi-statute solutions to facility
                     permitting,  enforcement and compliance assurance, education/  outreach,
                     research, and regulatory development issues. The central concepts driving the
                     new policy direction are that pollutant releases to each environmental medium
                     (air, water and land) affect each other, and that environmental strategies must
                     actively identify and address these inter-relationships by designing policies for
                     the "whole" facility.  One way to achieve a whole facility focus is to design
                     environmental  policies  for  similar  industrial facilities.  By doing  so,
                     environmental concerns that  are common to the manufacturing of similar
                     products can be addressed  in a  comprehensive manner. Recognition of the
                     need to develop the industrial "sector based" approach within the EPA Office
                     of Compliance led to the creation of this document.

                     The Sector Notebook Project was originally initiated by the  Office of
                     Compliance within the Office of Enforcement and Compliance Assurance
                     (OECA) to provide its staff  and managers with summary information for
                     eighteen specific industrial sectors. As other EPA offices, states, the regulated
                     community, environmental  groups, and the public became interested in this
                     project, the scope of the original project was expanded to its current form.
                     The ability to design comprehensive, common sense environmental protection
                     measures for specific industries  is dependent on knowledge of several inter-
                     related topics. For the purposes of this project, the key elements chosen for
                     inclusion are: general industry information (economic and geographic); a
                     description of industrial processes; pollution outputs; pollution prevention
                     opportunities; Federal statutory  and regulatory  framework; compliance
                     history; and  a description of partnerships that have been formed between
                     regulatory agencies, the regulated community and the public.

                     For any given industry, each topic listed above could alone be the subject of
                     a lengthy volume.  However, in order to produce a manageable document, this
                     project focuses  on providing summary information for each topic.  This
                     format provides the reader with a synopsis of each issue, and references if
                     more in-depth information  is  available. The contents of each profile were
                     researched from a variety of sources, and were usually condensed from more
                     detailed sources.  This approach allowed for a wide coverage of activities  that
                     can be further explored based upon the citations and references listed at the
                     end of this profile. As a check on the information included, each notebook
                     went through an external review process.  The Office of Compliance
                     appreciates  the efforts of all those who  participated in this process who
Sector Notebook Project
         September 1997

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Pharmaceutical Industry
Sector Notebook Project
                    enabled us to develop more complete, accurate and up-to-date summaries.
                    Many of those who reviewed this notebook are listed as contacts in Section
                    X and may be sources of additional information. The individuals and groups
                    on this list do not necessarily concur with all statements within this notebook.

I.B. Additional Information
Providing Comments
                    OECA's Office of Compliance plans to periodically review and update the
                    notebooks and will make these updates available both in hard copy and
                    electronically. If you have any comments on the existing notebook, or if you
                    would like to provide additional information,  please send a hard copy and
                    computer disk to the EPA Office of Compliance, Sector Notebook Project,
                    401 M St., SW (2223-A), Washington, DC 20460.  Comments can also be
                    uploaded to the Enviro$en$e World Wide Web for general access to all users
                    of the system. Follow instructions in Appendix A for accessing this system.
                    Once you have logged in, procedures for uploading text are available from the
                    on-line Enviro$en$e Help System.
Adapting Notebooks to Particular Needs
                     The scope of the industry sector described in this notebook approximates the
                     national occurrence of facility types within the sector. In many instances,
                     industries within specific geographic regions or states may have unique
                     characteristics that are not fully captured in these profiles.  The Office of
                     Compliance encourages  state and local environmental agencies and other
                     groups to supplement or re-package the information included in this notebook
                     to include more specific industrial and regulatory information that may be
                     available.   Additionally,  interested states may  want to supplement the
                     "Summary of Applicable Federal Statutes and Regulations" section with state
                     and local requirements.  Compliance or technical assistance providers may
                     also want to develop the "Pollution Prevention" section in more detail. Please
                     contact the appropriate specialist listed on the opening page of this notebook
                     if your office is interested in assisting us in the further development of the
                     information or policies addressed within this volume. If you are interested in
                     assisting in the development of new notebooks for sectors not already
                     covered, please contact the Office of Compliance at 202-564-2395.
 Sector Notebook Project
          September 1997

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Pharmaceutical Industry	Introduction

EL INTRODUCTION TO THE PHARMACEUTICAL INDUSTRY

                    This  section provides background information  on the size, geographic
                    distribution, employment, production, sales, and economic condition of the
                    pharmaceutical industry.  Facilities described within this document are
                    described in terms of their Standard Industrial Classification (SIC) codes.

H.A. Introduction, Background, and Scope of the Notebook

                    The Standard Industrial Classification (SIC) code established by the U.S.
                    Office of Management and Budget (OMB) to track the flow of goods and
                    services within the economy is 283 for the Pharmaceuticals industry.  The
                    industry is further categorized by four 4-digit SIC codes consisting of:

                           Medicinals and Botanicals (SIC 2833)
                           Pharmaceutical Preparations (SIC 2834)
                           In Vivo and in Vitro Diagnostic Substances (SIC 2835)
                           Biological Products, except diagnostics (SIC 2836)

                    OMB is in the process of changing the SIC code system to a system based on
                    similar  production  processes   called  the  North  American  Industrial
                    Classification System (NAICS). In the NAIC system, medicinals  and
                    botanicals are classified as NAIC 325411 and pharmaceutical preparations are
                    classified as NAIC 325412.

                    According to the U.S. Census of Manufacturers, in 1992 the Medicinals and
                    Botanicals and Pharmaceutical Preparations categories accounted for 64
                    percent of establishments and 81 percent of the value of shipments in the
                    industry. In comparison, the In Vitro and In Vivo Diagnostic Products and
                    Biological Products categories are relatively small.  Together they accounted
                    for the remaining 36 percent of establishments and 19% of the value of
                    shipments in the industry. In general, the industrial processes  and subsequent
                    environmental impacts of the In Vitro and In Vivo Diagnostic Products and
                    Biological Products categories are different from those of the Medicinals and
                    Botanicals  and Pharmaceutical Preparations  categories.   This notebook
                    concentrates on the two larger categories (SIC 2833 and 2834) within SIC
                    283.

H.B. Characterization of the Pharmaceutical Industry

                    As defined by its SIC Code, the pharmaceuticals industry (SIC 283) consists
                    of establishments that are primarily involved in  fabricating or processing
                    medicinal chemicals and pharmaceutical products.  The industry also includes
                    establishments that formulate pharmaceutical products and  are involved in
                    grinding,  grading, and  milling  of botanical products. The Census of
                    Manufacturers  defines an establishment as a single physical location or a

Sector Notebook Project                    3                             September 1997

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Pharmaceutical Industry	Introduction

                     facility  where manufacturing  occurs.   If more than one  distinct line of
                     manufacturing occurs at the same location, the Bureau of Census requires
                     separate reports for each activity.

                     Although the industry is part of the two-digit SIC code 28 for Chemicals and
                     Allied Products, it differs significantly from the rest of the chemicals industry
                     in its industrial processes and regulatory requirements. For example, in its
                     industrial processes, the pharmaceuticals industry uses more batch operations
                     than the chemicals industry as a whole. Since some of the bulk manufacturing
                     operations involve extracting relatively small, highly concentrated  quantities
                     of active ingredients from much larger volumes of raw material, the industry's
                     production yield for these operations is correspondingly low.

                      The pharmaceuticals industry also receives extensive regulatory oversight by
                     the U.S. Food and Drug Administration (FDA). In 1996, the Center for Drug
                     Evaluation and Research, FDA approved 131 new drug applications (NDAs),
                     of which 53 were new molecular entities. According to the Congressional
                     Office of Technology Assessment (OTA) in 1993, it costs an average of $359
                     million to develop a new drug and complete the drug approval process.  Total
                     drug development and agency review time averaged  15.3  years for drugs
                     approved from 1990 through 1995. More information on the typical industrial
                     processes and regulatory requirements of this industry is provided in Sections
                     HI and VI, respectively.

                     When a pharmaceutical company  discovers a compound that  may  have
                     medical potential, the company usually applies for a patent. Patents are valid
                     for 20 years from the date of application. Any drug made from the compound
                     may be marketed  only after  approval by  the  federal Food  and Drug
                     Administration (FDA).  The drug development process, beginning with initial
                     toxicology testing, followed by clinical trials for safety and effectiveness, and
                     review  of the application  by the FDA averages fifteen years.   When the
                     company's patent or period of exclusivity has expired, other companies may
                     rely on the original manufacturer's data on safety and effectiveness to obtain
                     approval to market a generic version of the  drug.  Companies wanting to
                     manufacture the same drug once it is off-patent are required to obtain FDA
                     marketing   approval,  based on evidence  that  the  generic  version  is
                     "bioequivalent," i.e., differs in the rate and extent of drug absorption by no
                     more than 25 percent nor  less than the 20 percent from the original drug
                     (FDA,  1996).   While companies that specialize in the development and
                     marketing of brand-name, innovator drugs1 may have subsidiaries  that
1 The term "brand name" is used interchangeably with "pioneer drug" or "innovator's drug product". The terms reflect
the fact that the drug product is the first to contain a particular active ingredient or ingredients to receive FDA approval
for a specified use. The term "generic" drug is used to describe a product that contains the same active ingredients but
not necessarily the same excipients (inactive ingredients) as a so-called "pioneer drug".

Sector Notebook Project                     4                             September 1997

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Pharmaceutical Industry
  Introduction
                     manufacture generic products, most generic drug companies do not conduct
                     research intended to identify and develop innovator drugs (PhRMA, 1997).

                     Because of the high cost and time to approval, effective patent protection is
                     an essential component in the decision to invest in drug development and
                     marketing.  This is especially true for international companies interested in
                     marketing drugs in several countries, each with its own approval procedure
                     and marketing  requirements.   While  the  International  Conference  on
                     Harmonization is  proposing harmonized  rules for drug registration and
                     approval for Europe, Japan and the United States, each  country retains its
                     own approval system.  In other countries, especially developing countries, the
                     issue of adequate  patent protection is a central concern  of pharmaceutical
                     manufacturers (PhRMA, 1997).

                     Discovery of new compounds followed by further research and development
                     (R&D) is one of the primary functions of the industry. The pharmaceutical
                     production process starts with an extensive research stage, which can last
                     several years.  Following the discovery of a new drug that appears to have
                     efficacy in treating or preventing illness, pre-clinical tests and clinical trials are
                     conducted.  Then a New Drug Application (NDA) is submitted to the FDA
                     for approval.  According to  a primary trade association for pharmaceutical
                     companies producing brand name drugs, the Pharmaceutical Research and
                     Manufacturers of America (PhRMA), it takes an average of 15 years to bring
                     a new drug to market, from time of discovery to approval (PhRMA, 1996).
                     It is only after FDA approval has been secured that market distribution in the
                     U.S. can begin.

                     The competition for discovering new drugs and bringing them to market is
                     extremely high.  As a result, a significant proportion of the industry's sales are
                     reinvested into research and development (R&D).  According to PhRMA,
                     total R&D expenditures, both domestically and abroad, by its members, will
                     be close to $19 billion dollars in  1997. PhRMA estimates that over 21% of
                     total sales will be reinvested into R&D by its members (PhRMA,  1997).

       II.B.1. Product Characterization

                     The pharmaceutical industry manufactures bulk substance pharmaceutical
                     intermediates and active ingredients which are further processed into finished
                     products.

       Medicinals and Botanicals (SIC 2833)

                     Companies in the Medicinals and Botanicals industry category are primarily
                     engaged in 1) manufacturing bulk organic and inorganic medicinal chemicals
                     and their derivatives and 2) processing (grading, grinding, and milling) bulk
                     botanical drugs and herbs.  The industry  is made up  of establishments or
Sector Notebook Project
September 1997

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Pharmaceutical Industry	Introduction

                     facilities that manufacture products of natural origin, hormonal products, and
                     basic vitamins, as well as those that isolate active medicinal principals such as
                     alkaloids from botanical drugs and herbs (OMB, 1987).  These substances are
                     used as active ingredients for the Pharmaceutical Preparations  industry
                     category.   Companies often produce both Medicinals and Botanicals and
                     Pharmaceutical Preparations at the same facility.

       Pharmaceutical Preparations (SIC 2834)

                     The Pharmaceutical Preparations industry category is made up of companies
                     that manufacture, fabricate, and process raw materials into pharmaceutical
                     preparations for human and veterinary uses.  Finished products are sold in
                     various dosage forms including,  for example, tablets, capsules, ointments,
                     solutions, suspensions, and powders. These are 1) preparations aimed for use
                     mainly by dental, medical, or veterinary professionals, and 2) those aimed for
                     use by patients and the general public  (OMB, 1987). A more  in depth
                     discussion of these  finished  products is provided in  Section III.A.3.
                     Pharmaceutical products also are often classified in terms of their availability
                     to the general public.

                     Both prescription and over-the-counter (OTC) drugs are available to the
                     public.  Prescription drugs can be purchased only with a prescription from a
                     licensed health care professional authorized to prescribe, while OTC drugs
                     may be purchased without a prescription. The FDA will consider approving
                     the switch of a drug from prescription  to  OTC when the manufacturer
                     presents evidence that consumers can self-diagnose the condition for which
                     the drug is approved, i.e., cold or seasonal allergy, and directions for use can
                     be-written for the consumer (PhRMA, 1997).

       //; Vivo and In Vitro Diagnostic Substances (SIC 2835) and Biological Products (SIC 2836)

                     The In Vivo and In Vitro Diagnostic Substances industry category (SIC 2835)
                     includes facilities that manufacture in vivo (tested inside a living organism)
                     and in vitro (tested outside of a living organism) diagnostic substances.  They
                     produce chemical, biological, and radioactive substances used in diagnosing
                     and monitoring health. The Biological Products industry category (SIC 2836)
                     produces bacterial and virus vaccines, toxoids, serums, plasmas, and  other
                     blood derivatives for human and veterinary use, other than in vitro and in vivo
                     diagnostic substances (OMB, 1987).

       H.B.2. Industry Size

                     According to the U.S.  Census of Manufactures for the pharmaceuticals
                     industry as a whole (SIC 283),  in 1992  there were a  total  of  1,425
                     establishments employing 194,000 people (excluding Puerto Rico).   It is
                     possible that some of the smaller facilities identified by the Census are actually

Sector Notebook Project                      6                             September 1997

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Pharmaceutical Industry
   Introduction
                     sales, marketing or distribution centers in which no manufacturing operations
                     take place. Such possible misclassifications have no significant effect on the
                     census statistics other than on the number of companies and establishments.
                     (U.S. Department of Commerce, 1995) The value of total shipments was
                     over $67 billion (see Table 1). Pharmaceutical Preparations (SIC 2834) was
                     the largest sector in terms of number of facilities (48 percent), employment
                     (63 percent), and value of shipments (75 percent). The remaining facilities,
                     employment,  and value of shipments  were  divided evenly among the
                     remaining sectors within the industry. One exception is the In Vivo and In
                     Vitro Diagnostic Products sector (SIC 2835) which claims a higher portion
                     of employment than SIC codes 2833 and 2836.  Figure 1 displays the value
                     of shipments by sector, and Figure 2 displays employment by sector.

                     A relatively significant number of pharmaceutical establishments are located
                     in Puerto Rico. This is in part the result of the federal government's policy
                     decision to encourage job creation by offering tax incentives to manufacturers
                     to locate new plants in Puerto Rico. A 1996 tax law  phases-out those tax
                     incentives over the next ten years.

                     The  effects of  the tax incentive are illustrated by the concentration of
                     pharmaceutical  plants in Puerto Rico.   According to the  1992 Economic
                     Census of Outlying Areas, which covers statistics for Puerto Rico, there were
                     a total of 88 establishments in Puerto Rico. Of these 88, 74 establishments
                     were in the Pharmaceutical Preparations industry, 8 were in the Medicinals
                     and Botanicals industry, and the remaining six establishments were in the In
                     Vitro and In Vivo Diagnostic Products industry, and the Biological Products,
                     except diagnostic substances industry. The total value of shipments of the 88
                     establishments located in Puerto Rico was about $12 billion.  Pharmaceutical
                     Preparations  accounted for about 92 percent of this.  The pharmaceutical
                     industry  in  Puerto  Rico employed about 25,000   people in  the 88
                     establishments in 1992.
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Pharmaceutical Industry
                                Introduction
Table 1: Summary Statistics for the Pharmaceutical Industry

Industry
SIC 2833
SIC 2834
SIC 2835
SIC 2836
Total
50 STATES
Number of
Establishments
225
691
234
275
1,425
Number of
Companies1
208
585
205
193
1,191
Value of
Shipments
(millions of
dollars)2
6,438
50,418
6,838
3,974
67,668
Employment
(OOO's)
13
123
40
18
194
PUERTO RICO
Number of
Establishments
8
74
5
1
88
Value of
Shipments
(millions of
dollars)2
N/A3
11,097
477
N/A3
11,924
Employment
(OOO's)
N/A3
22
1
N/A3
25
Source: 1992 Census of Manufacturers, Industry Series: Drugs, US Department of Commerce, Bureau of the Census,
1995and1992EconomicCensus of Outlying Areas, Manufacturers: Puerto Rico, US Department of Commerce, Bureau
of the Census, 1994.

'Defined as a business organization consisting of one establishment or more under common ownership or control.
2 Value of all products and services sold by establishments in the pharmaceuticals industry.
'Certain census data  are not available for Puerto Rico. Information is withheld to avoid  disclosing  data for individual
facilities.
           Figure 1: Percent of Total Value of Shipments by Sector
                   75%
                                                                   10%
                      Pharmaceutical Preparations
                      In Vitro and In Vivo Diagnostics
Medicinal sand Botanicals
Biological Products
         Source: 1992 U.S. Census of Manufacturers.
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Pharmaceutical Industry
                    Introduction
                   Figure 2: Employment in the Pharmaceutical Industry
                       140

                       120-

                       100-
                     -s- 80 H
                     o
                     o
                     S. 60 -
                        40
                        20-
                                     Pharm. Preparations
Biological Products
                         Medicinals and Botanicals  In Vitro and In Vivo Diagnostics
                     Source: 1992 U.S. Census of Manufacturers.
                     As shown in Table 2, many facilities within the pharmaceutical industry are
                     small.  Almost 70 percent of the facilities employ fewer than 50 people.
                     However, a relatively small number of large companies account for a large
                     portion of the total value of shipments, as well as employment. For example,
                     according to the 1992 U.S. Census of Manufacturers, only 36 facilities (less
                     than three percent) employed more than 1,000 people in the 50 states (i.e., not
                     including Puerto Rico).  However, these 36 facilities accounted for over 38%
                     of the total value of shipments for the industry.  In comparison, 968 facilities
                     (almost 70 percent) employ fewer than 50 people.  However, these facilities
                     accounted for less than four percent of the industry's value of shipments.
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Pharmaceutical Industry
                                   Introduction
Table 2: Pharmaceutical Industry (SIC 283) Facility Size1
Number of Employees
fewer than 10
10 to 49
50 to 249
250 to 999
1,000 or more
Total
Number of Facilities
479
489
292
129
36
1,425
Percent of Total
Facilities (%)
34
34
20
9.1
2.5
100
Percent of Total Value
of Shipments (%)
0.6
3.2
19
392
382
100
Source: 1992 Census of Manufacturers, Industry Series: Drugs, Bureau of the Census, 1995.
 Does not include Puerto Rico - information withheld to avoid disclosing data for individual facilities.
2 Some information withheld to avoid disclosing individual facility data. Values may be somewhat higher.
        Medicinals and Botanicals (SIC 2833) and Pharmaceutical Preparations (SIC 2834)

                      The establishment size distributions for Pharmaceutical Preparations and
                      Medicinals and Botanicals are similar (see Table 3).  The Pharmaceutical
                      Preparations sector, however, has a somewhat higher proportion of large
                      facilities. As is the case with the pharmaceuticals industry as a whole, a
                      relatively small number of large establishments account for the majority of the
                      total value of shipments for the Pharmaceutical Preparations industry.  Value
                      of shipment data is not available by establishment size for  the Medicinals and
                      Botanicals sector.
Table 3: Employment Size Distribution for Medicinals and Botanicals and
Pharmaceutical Preparations Establishments 1

Number of
Employees

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Pharmaceutical Industry
                                 Introduction
                     Table 4 lists the largest U.S. pharmaceutical companies in terms of U.S.
                     prescription sales.
Table 4: Top U.S. Pharmaceutical Companies by Sales
Rank
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Company
Glaxo Wellcome
Johnson & Johnson
American Home Products
Bristol-Myers Squibb
Merck & Co
Pfizer
Novartis
SmithKline Beecham
Lilly
Abbott
Schering-Plough
Hoechst Marion Roussel
Roche
Amgen
Bayer
1996 Rx Sales
(millions of dollars)
5,803
5,275
5,251
5,160
5,026
4,511
3,786
3,589
3,567
3,423
3,272
2,474
2,316
1,860
1,854
                     Source: IMS America,
       II.B.3. Geographic Distribution
                     The U.S. Pharmaceuticals industry has traditionally been concentrated in New
                     Jersey, California, and New York (see Figure 3). These three states account
                     for about one third of the facilities,  employees, and value of shipments.
                     Historically, the industry concentrated here because these were vocational
                     centers. Other states, such as Massachusetts, North Carolina and Maryland,
                     have  seen  recent growth  in the Pharmaceuticals industry, especially in
                     biotechnology and research and development.
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Pharmaceutical Industry
                                Introduction
     Figure 3; Geographic Distribution of Pharmaceutical Facilities (SIC 2833 and 2834)
   Source: 1992 U.S. Census of Manufacturers.
                    A significant number of pharmaceutical establishments are also located in
                    Puerto Rico. According to the 7992 Economic Census of Outlying Areas,
                    which covers  statistics  for  Puerto  Rico,  there  were a  total  of 88
                    Pharmaceuticals establishments in Puerto Rico accounting for almost $12
                    billion in shipments.   Eighty two of these establishments were  in  the
                    Pharmaceutical Preparations and Medicinals and Botanicals sectors. These
                    establishments accounted for 11 percent of all  employment and 15 percent of
                    the value of shipments for these sectors.   The driving force behind the
                    Pharmaceuticals industry concentrating in Puerto Rico over the years are tax
                    incentives specifically directed at the industry.

                    Many U.S. firms have facilities abroad or own foreign companies in which
                    both R&D and production of Pharmaceuticals are conducted.  According to
                    PhRMA,  in  1996  its member firms  employed close to 165,000 people
                    overseas in the production of prescription pharmaceuticals. Of these, about
                    42% were employed in Western Europe. The next largest region for overseas
                    employment  by PhRMA member  companies is  Latin America and  the
                    Caribbean, with 20  percent  (PhRMA,  1996).   Recently,  a number of
                    pharmaceutical companies are moving production to Ireland. Similarly, many
                    foreign owned pharmaceutical firms operate pharmaceutical research  and
                    development and production facilities in the U.S.
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Pharmaceutical Industry
                                 Introduction
       II.B.4. Economic Trends and International Competition

       Changes in the U.S. Health Care Industry

                    During the early 1990s the United States pharmaceutical industry faced major
                    challenges associated with the changing nature of health care delivery coupled
                    with intense market competition.  In 1995 about 62 percent of prescriptions
                    were paid for by insuring third parties, up from 39 percent in 1990.  Third
                    parties, including managed care organizations and Medicaid, consider cost in
                    choosing which drugs are approved for reimbursement. Techniques such as
                    substituting generic  drugs for branded  drugs are also used.  Low priced
                    generic drugs  rapidly capture  a large share  of prescriptions once the
                    originating drug's patent expires. Likewise, intense R&D rivalries between
                    companies now mean that new products  may have major competition within
                    months after their FDA approval, as was the case for three competing
                    protease inhibitors approved between  December 1995 and April  1996.
                    Companies have  responded to  shorter  product life  cycles and cost
                    containment pressures by forming an increasing number of strategic alliances
                    and merging.  However, a steady stream of new product introductions has
                    contributed to steady industry growth driven by an  increasing volume of
                    prescriptions.  In 1997,  research-based  companies' net sales in the United
                    States are projected to reach $66.1 billion, a 5.5 percent increase over 1996
                    (PhRMA, 1997).

       Consolidation of the Pharmaceuticals Industry

                    Competitive pressures are forcing many companies to restructure and form
                    mergers and strategic alliances. Increasing competition from both domestic
                    and foreign firms, as well as from the generic drug market, has forced  mergers
                    between the larger pharmaceutical companies and mid-sized companies.  In
                    1989,  three  major  mergers  occurred  between  large  and  mid-sized
                    pharmaceutical companies. In 1995, this number increased  to seven. In 1996,
                    there were three mergers.

                    As a result of generic competition, some brand name firms  are becoming
                    involved with companies that manufacture generic  drugs by purchasing
                    existing companies, setting up their own generic drug ventures, or  forming
                    partnerships  (PhRMA,  1996).   Also,  many smaller biotech and  R&D
                    companies are merging  with large pharmaceutical companies.  Strategic
                    alliances often  involve domestic and foreign pharmaceutical  companies,
                    biotech firms, university research centers, government agencies such as the
                    National Institute  of Health, and contract research organizations. Such
                    mergers and alliances allow companies to draw upon  each others' research
                    expertise, bring products to market more rapidly, and more  effectively market
                    products once they are approved by FDA.
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Pharmaceutical Industry
                                Introduction
       Changes in Geographical Concentrations
                    An increasing number of establishments owned by U.S. companies  are
                    locating outside the U.S.  A number offerees are driving these changes,
                    including the growing international market for pharmaceutical products,
                    foreign registration requirements and patent laws, laws allowing sales only if
                    the products are manufactured in the country; and tax incentives.
       International Trade and Competition
                    The U.S. pharmaceuticals industry accounts for about one-third of all
                    Pharmaceuticals marketed worldwide (see Figure 4). The major U.S. trading
                    partners are Europe, Japan, Canada, and Mexico. The largest importer of
                    U.S. pharmaceuticals is the European Community (EC).  In 1993, the EC
                    alone imported nearly 50% of all U.S.  exports (ITA, 1994). Canada and
                    Mexico combined imported 15 percent of all U.S. exports of pharmaceutical
                    products in 1993.  The North American Free Trade Agreement (NAFTA),
                    however, has increased the volume of trade with Canada and Mexico in recent
                    years.

                    Although Japan still remains  one  of the  largest  importers  of  U.S.
                    pharmaceuticals, Japanese pharmaceutical companies  have been  investing
                    heavily in their own R&D, thereby reducing Japan's import share of U.S.
                    exports in recent years.

                    In 1993, European and Japanese pharmaceutical companies accounted for 27
                    percent and 22 percent  of all  pharmaceuticals  marketed worldwide,
                    respectively (PhRMA, 1996).  China and the countries of the former Soviet
                    Union are potentially large markets for U.S. pharmaceuticals. However,
                    China is also increasing its production  of pharmaceuticals and the former
                    countries of the Soviet Union pose some major challenges for U.S. producers
                    in  terms  of testing   and   licensing  regulations  (International  Trade
                    Administration, 1994).

                    Major  issues   affecting  the  international  competitiveness   of   U.S.
                    pharmaceutical  firms include  price controls and  intellectual  property
                    protection abroad. Other trade barriers include foreign pricing systems that
                    favor   locally  produced   pharmaceuticals,   discriminatory  registration
                    requirements,  and requirements that foreign companies  enter into  joint
                    ventures with domestic firms.
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Pharmaceutical Industry
                                 Introduction
                          Figure 4: World Sales of Pharmaceuticals, 1995
                                   Europe
                                    27%
                         Australasia
                             1%
                               United States
                                  30%
                                                                   Japan
                                                                    22%
                          Latin America
                               7%
                          Middle East
                             2%
                       Southeast
                      As ia& China
                 Canada   6%
                   3%
                         Source: Pharmaceutical Research and Manufacturers of America, 1997
                         based on data provided by IMS America, 1996.
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Pharmaceutical Industry
                Industrial Process Description
HI. INDUSTRIAL PROCESS DESCRIPTION
                     This section describes the major industrial processes within the pharmaceutical
                     industry,  including the materials and equipment used, and the processes
                     employed. The section is designed for those interested in gaining a general
                     understanding of the industry, and for those interested in the inter-relationship
                     between the industrial process and the topics described in subsequent sections
                     of this profile ~ pollutant outputs, pollution prevention opportunities, and
                     Federal regulations.  This section does not attempt to replicate published
                     engineering information that is available for this industry. Refer to Section IX
                     for a list of reference documents that are available.

                     This section specifically contains a description of commonly used production
                     processes, associated  raw materials, and the materials either recycled or
                     transferred off-site. This discussion, coupled with schematic drawings of the
                     identified processes, provides a description of where wastes may be produced
                     in the process. A more in-depth description of the major wastes produced by
                     pharmaceutical manufacturing can be found in Section III.B.

                     Additionally, it is important to understand the regulatory framework in which
                     pharmaceutical products are manufactured. To protect the public from unsafe
                     or ineffective pharmaceutical products,  Congress established a stringent
                     regulatory system to control the research and development, manufacture and
                     marketing of pharmaceutical products. The US Food and Drug Administration
                     (FDA) was delegated the responsibility for: (i) evaluating the  safety and
                     efficacy of new drugs; (ii) determining if the benefits of the drug outweigh the
                     risks  and warrant approval  for  sale;  and  (iii) reviewing toxicological
                     performance  of  active  pharmaceutical  ingredients.   For  most new
                     pharmaceutical compounds, FDA oversight begins soon after the discovery
                     of the compound.
HLA. Industrial Processes in the Pharmaceutical Industry
                     The production of pharmaceutical products can be broken down into three
                     main stages: 1) research and development; 2) the conversion of organic and
                     natural substances into bulk pharmaceutical substances or ingredients through
                     fermentation, extraction, and/or chemical synthesis; and 3) the formulation of
                     the final pharmaceutical product.
HLA.1.  Research and Development
                     New drug development involves four principal phases:  Pre-Clinical Research
                     and Development; Clinical Research and Development; Review of New Drug
                     Application; and Post Marketing Surveillance.  Pre-Clinical Research and
                     Development begins after a promising compound has been discovered and
                     isolated in the  laboratory.  In this phase, the compound is subjected to
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Pharmaceutical Industry	Industrial Process Description

                     extensive laboratory and animal tests to determine whether the compound is
                     biologically active and safe.  The average time to complete this phase is six
                     years.

                     After completing the Pre-Clinical Research  and Development  and before
                     testing the drug in humans, an application is filed with FDA known as an
                     Investigational New Drug Application (END).  The application must show the
                     results of the pre-clinical testing and detail the plans for human clinical tests.
                     It must also  contain information  about the  chemical structure  of the
                     compound  and  a general  description  as to  how  the  compound  is
                     manufactured.

                     Clinical Research and Development is typically conducted in three phases,
                     with each phase involving progressively more people.  The first phase, which
                     typically lasts about a year, is aimed at establishing the drug's safety and
                     involves a small number of healthy volunteers.  The second phase, which lasts
                     about two years, helps the scientists determine the drug's effectiveness. In the
                     third phase, the drug is used in clinics and  hospitals, and scientists must
                     confirm the results  of earlier tests and identify any  adverse reactions.
                     Altogether the three phases of Clinical Research and Development take about
                     six years.

                     In the first phase of Clinical Research and Development, a small amount of the
                     compound is manufactured in a pilot plant for use in the clinical trials.  This
                     batch of compound is called Clinical Trial Material (CTM). At this time, the
                     manufacturing  steps  of the compound are also  optimized and improved.
                     During this phase, attention to waste minimization considerations is most
                     effective.

                     After Clinical Research and Development is  completed, the company files,
                     with the FDA,  a New Drug Application (NDA) containing comprehensive
                     data about the compound. The NDA must include data to demonstrate that
                     the drug is safe and effective for use under the conditions described in its
                     labeling. FDA regulations require that the NDA contain specific and detailed
                     information on: the components and composition of the drug; the methods
                     and controls used in the manufacturing; processing and packaging of the drug;
                     and, data from all pre-clinical and clinical investigations. In 1993, the median
                     total approval time for NDAs was 21 months.  This has been significantly
                     reduced and in 1996, the median total approval time  for NDAs was 15
                     months.

                     Each step in the manufacturing process, and the identity and quality of each
                     ingredient used in the process, must be specified in the NDA and approved by
                     the FDA.  Once the NDA is approved,  certain changes cannot be made
                     without the filing and approval by the FDA  of a supplemental application,
                     known as an SNDA.  The level of reporting depends on the type of change

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Pharmaceutical Industry
                Industrial Process Description
                     and may require substantial investment of resources to implement.  FDA
                     approval may take several years to obtain depending on the nature  of the
                     change, and some changes even require new clinical studies.

                     Based on data from a 1995 study by the Center for  the Study of Drug
                     Development  at Tufts  University,  a  pharmaceutical  Research  and
                     Development (R&D) facility discovering and developing a new medicinal
                     agent will evaluate approximately 5,000 to 10,000 compounds. About 250
                     of these substances may hold therapeutic promise and enter preclinical testing.
                     However, only about five will go on to  limited human clinical testing.
                     Subsequently, only one, after 15.3 years of research and development, will be
                     introduced commercially as a new drug (PhRMA, 1997).

                     Basic research is responsible for identifying and isolating or synthesizing each
                     new chemical  entity that  will  be evaluated for  its potential therapeutic
                     effectiveness. Once a lead compound has been identified and characterized,
                     some 1,000  related chemical substances will be synthesized and studied by
                     laboratory assay systems. These assay systems are designed to identity which
                     compounds exhibit the most specific and potent biological effect. For each
                     compound tested, generally some 5-10 separate chemical reactions will be
                     needed to synthesize the compound. The results of biological testing will then
                     guide the direction of subsequent synthetic operations. If the results are
                     unsatisfactory, then the process starts anew.

                     Should a substance show promise in the laboratory assays, limited animal
                     studies are  started.   If there is  no activity in the  animal, other related
                     compounds  will  be evaluated or the program will be discontinued.  Once
                     biologically  active substances  are identified,  they  will undergo further
                     chemical modification to refine their efficacy and safety.

                     Once an active candidate has been identified, it will be proposed for formal
                     development. Pharmaceutical development includes the evaluation of synthetic
                     methods on a larger scale and the assessment of various ways of formulating
                     the drug to provide optimum delivery. Up to this point, only small amounts
                     have been synthesized for evaluation. More will  be needed for the extensive
                     animal testing required by FDA. Even larger amounts will be required for the
                     extensive clinical studies in humans required before federal approval.

ni.A.2. Production of Bulk Pharmaceutical Substances

                     Bulk pharmaceutical substances typically consist of structurally complex
                     organic  chemical compounds  which  are  manufactured via  a series of
                     intermediate steps and reactions under precise conditions. These substances
                     are  used  in the manufacture of the  dosage  form of a formulated
                     pharmaceutical product and are manufactured by: (1) chemical synthesis; (2)
                     fermentation; (3) isolation/recovery from natural sources, or (4) a combination
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Pharmaceutical Industry
                      Industrial Process Description
                     of these processes. Examples of different drugs produced by each of these
                     processes are presented in Table 5.
           Table 5: Examples of Pharmaceutical Products by Bulk Manufacturing Process
           Chemical Synthesis
           Antibiotics
           Antihistamines
           Cardiovascular Agents
           Central Nervous System (CNS)
              Stimulants
           CNS Depressants
           Hormones
           Vitamins
Natural Product Extraction
Antineoplastic Agents
Enzymes and Digestive Aids
CNS Depressants
Hematological Agents
Insulin
Vaccines
Fermentation
Antibiotics
Antineoplastic Agents
Therapeutic Nutrients
Vitamins
Steroids
                     Most pharmaceutical substances are manufactured utilizing "batch" processes.
                     In a batch process, a particular substance or "intermediate"2 is manufactured
                     in a "campaign" for periods ranging from a few days to several months until
                     sufficient material is manufactured to satisfy the projected sales demand. At
                     the end of the manufacturing campaign, another pharmaceutical intermediate
                     or substance is made. The same equipment with  potentially  different
                     configurations and the same operating personnel are often used to make a
                     different intermediate or substance, utilizing different raw materials, executing
                     different processes, and generating different waste streams.

                     When the same equipment is used for manufacturing different intermediates
                     and/or different bulk substances, the equipment is thoroughly  cleaned and
                     validated prior to its reuse.  Where cleaning of a specific type of equipment
                     is difficult or where a sufficient volume  of a certain intermediate or bulk
                     substance is made every year, the equipment may be dedicated to the batch
                     manufacturing of a particular intermediate or  bulk substance.   Where the
                     equipment is dedicated to the production  of successive batches of the same
                     intermediate or bulk substance, the equipment may not be washed and cleaned
                     between batches. Instead, the cleaning schedule will depend on whether there
                     is a potential for carryover of contaminants or degraded materials that could
                     affect the final product.

                     The specific methods  and materials (e.g., water, steam, detergents, and/or
                     organic solvents) used to clean the equipment are based on the ability of the
                     cleaning  process  to  remove residues  of raw materials,  intermediates,
                     precursors, degradation products, and isomers (FDA, 1996).
       An intermediate is a material produced during a manufacturing process that must undergo further molecular
       change or processing before it becomes a bulk pharmaceutical substance.
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Pharmaceutical Industry
                Industrial Process Description
                     Raw materials are checked for their identity and quality before use in the
                     manufacturing processes.  Additionally, in-process testing, as well as quality
                     assurance/quality control (QA/QC) testing in onsite laboratories, is performed
                     during drug product manufacturing. In-process testing may include simple pH
                     measurements or checks  on color, while QA/QC testing typically includes
                     more sophisticated analyses such as chromatography. "Upon completion of
                     the manufacturing operation,  batch-production records  are  checked by
                     competent and responsible personnel for actual yield against theoretical yield
                     of a batch and to ensure that each step has been performed and signed for"
                     (McGraw Hill Encyclopedia of Technology).

       Chemical Synthesis

                     Most of the compounds used today as pharmaceutical products are prepared
                     by chemical  synthesis, generally by  a  batch process (Watthey,  1992).
                     Cardiovascular agents, central nervous system agents, vitamins, antibiotics,
                     and antihistamines are just a  few examples of the bulk pharmaceutical
                     substances made by this process.

                     The manufacture of pharmaceutical compounds using chemical synthesis
                     involves a complex series of processes including many intermediate stages and
                     chemical  reactions performed in a step-by-step fashion. Depending on the
                     process, the operator (or a programmed computer) adds reagents, increases
                     or decreases the flow rate of chilled water  or  steam, and starts and stops
                     pumps to draw the reactor contents into another vessel. At other stages in the
                     process,  solutions may be pumped through filters or centrifuges, recycled
                     within the process, or pumped to recycling or disposal facilities. Co-products,
                     such as salts, may be sold for reuse.  Spent acids, metals, and catalysts may
                     be recovered and reused onsite or sold for reuse.

                     The material from each intermediate step may be isolated and transferred to
                     the next step of the process for continued processing until the final compound
                     is derived. These steps may be all conducted at the same manufacturing site,
                     or if the  intermediate is isolated, it may be transferred to another site for
                     further processing.

                     It is impossible to provide a single process flow diagram for this industry since
                     each bulk pharmaceutical substance is different in its manufacture and several
                     intermediates may be produced in a step-wise fashion prior to the manufacture
                     of the final active ingredient.   However, an example chemical synthesis
                     process has been provided  as Figure 5 to show the equipment used and where
                     wastes or emissions might be generated.
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Pharmaceutical Industry
                 Industrial Process Description
       Figure 5: Simplified Process Flow Diagram for Chemical Synthesis
         Scaled -jacket
       for cooling/heating
           media
 Source: Adapted from Economic Impact and Regulatory Flexibility Analysis of Proposed Effluent Guidelines for the
 Pharmaceutical Manufacturing Industry, 1995.
                     Reactors

                     The most common type of reactor vessel is the kettle-type reactor.  These
                     reactors typically range in capacity from 50 to several thousand gallons. The
                     vessels are made of either stainless steel or glass-lined carbon steel.

                     A diagram of a typical reactor vessel is shown in Figure 6.  "Reactors are
                     equipped to provide a range of capabilities that may be required during the
                     batch reaction step.  This equipment may include: a jacket for heating and
                     cooling, hookups for charging raw materials and for discharging the contents
                     of the reactor, an agitation and recycle line for mixing, control systems for
                     temperature and pressure, a condenser system for controlling vent losses, a
                     return line for refluxing condensables, a steam ejector for vacuum operation,
                     a nitrogen supply for padding and purging the reactor, and a manway for
                     taking samples and adding solid catalysts, reactants, and other solid materials
                     to the reactor" (USEPA 1993).
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Pharmaceutical Industry
                                         Industrial Process Description
             Figure 6: Typical Design of a Kettle-Type Batch Reactor
                                             Steam
                                        Pressure
                                       Relief Valve
                   Condensed    ^.  p-
                   Steam and       J^
                   Organics
                       Solvent,
                     Raw Material,
                     and Reactant
                       Addition
          Steam

    Cooling Water
      or Coolant
  Cooling Water
   or Coolant
!>
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Pharmaceutical Industry
                Industrial Process Description
                     Reactors are often attached to process condensers to recover solvents from
                     process operations. They are also often attached to other air pollution control
                     devices to remove volatile organics or other compounds from vented gases.
                     Depending on the reaction being carried out, a reactor may also be attached
                     to a distillation column for solvent separation and recovery.

                     Separation

                     Several separation mechanisms are employed by the pharmaceutical industry
                     including extraction,  decanting,  centrifugation,   and  filtration.  These
                     mechanisms may be employed jointly or individually, in multiple stages, to
                     separate the intermediate or bulk substance from the reaction solution and to
                     remove  impurities.  Crystallization is another common technique used to
                     separate the desired  active ingredient or intermediate from the reaction
                     mixture. Because crystallization is widely used in conjunction with other
                     separation techniques, it is presented separately from the other separation
                     techniques shown in Figure 5 and discussed below.

                     Extraction. Extraction is used to  separate liquid mixtures by taking advantage
                     of differences in the solubility  of the mixture components. A solvent that
                     preferentially combines with only one of the components is  added to the
                     mixture. "The  resulting mixture consists  of an extract (containing  the
                     preferentially combined material) and a  raffinate (containing the residual
                     phase).  Extraction may take place in an agitated reaction vessel (mixer-
                     settler), in a vertical cylinder (where the solvent flows upward or downward
                     through the liquid mixture), or in a column with internals to mechanically
                     enhance the contact between the two liquid phases" (Crume et al., 1992).

                     Decanting. Decanting is a simple process used to separate mixtures of a liquid
                     and insoluble solid that has settled to the bottom of a reactor or settling
                     vessel. The liquid over the solid is either pumped out of the vessel or poured
                     from the vessel leaving behind  the insoluble solid and a certain amount of
                     liquid.

                     Centrifugation. "Centrifuges are used to remove the intermediate or product
                     solids from a liquid stream" (USEPA 1979). Centrifuges work on the principle
                     of centrifugal force, in which an outward force is exerted on a rotating object.
                     Centrifuges are cylinders with rotating baskets within them.  The sides of the
                     basket are perforated and covered with filter medium such as woven fabric or
                     metal. As the basket rotates, a slurry solution is fed into the centrifuge via an
                     inlet pipe. The centrifugal force pushes the slurry against the rotating basket,
                     forcing the liquid to pass through the perforations, and the solids or filter cake
                     to remain behind, accumulating on the sides  of the basket.  "After all of the
                     slurry has been fed to the chamber, a wash liquid may be introduced to force
                     the remaining slurry liquid through the  cake and filter medium" (USEPA
                     1993). Once the centrifuge is turned off, the solids (i.e., the intermediates or
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Pharmaceutical Industry
                 Industrial Process Description
                     the final bulk substance) are scraped off the sides with an internal scraper or
                     manually scooped out. A diagram of a typical basket centrifuge is shown in
                     Figure 7.

      Figure 7: Cross-Section of Typical Top-Suspended Centrifugal Filter
                                                      Motor
                                                                      Slurry Inlet
       Casing
 Filtrate      ,        ,	
 Discharge    T    Adjuslable Unloader
                    Knife
                                                                  Wash Inlet
                                                                 Solids Cake
                                                                  Perforated Basket
                          Removable Valve Plate
                                                   Solids Discharge
 Source: Adapted from Control of Volatile Organic Compound Emissions from Batch Processes, EPA Guideline Series, 1993.
                     The extremely high speeds and frictional forces involved in  centrifuging,
                     combined with the potential build-up of combustible solvent vapors, create a
                     potential for an explosive environment to develop within the centrifuge. To
                     control this, an inert gas,  usually nitrogen, may be introduced into the unit
                     before the slurry is fed in.  "Centrifuges must be carefully operated to avoid
                     air infiltration by vortex entrainment. Therefore, they usually are operated
                     under nitrogen blanket and kept sealed under operation" (USEPA 1993).
                     VOC emissions may occur when purging the vessel before loading and
                     unloading (USEPA, 1993).

                     Filtration.  Filtration  is the separation of a fluid-solids mixture involving
                     passage of most of the fluid through a porous barrier (the filter medium)
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Pharmaceutical Industry	Industrial Process Description

                     which retains most of the solid particulates contained in the mixture ((Perry's
                     1984). In the pharmaceutical industry, "filtration is used to remove solids
                     from a liquid, whether these solids be product, process intermediates, catalysts
                     or carbon particulates (e.g., from a decoloring step)" (USEPA 1979).   Batch
                     filtration systems widely used by the pharmaceutical industry are the plate-
                     and-frame  filter,  cartridge  filters,  the nutsche filter,  and combination
                     filter/dryers.

                     "The normal filtration procedure is simply to force or draw the mother liquor
                     through  a  filtering  medium.  Following filtration, the retained solids are
                     removed" (USEPA, 1979). The wet cake may then go through a reslurry
                     process where it is washed and filtered again. "This option is usually carried
                     out when a highly specialized product requiring high purity is desired or when
                     solvents were not removed as part of the original slurry filtration (USEP A,
                     1993).

                     Crystallization

                     After the reaction takes place, the intermediate or final bulk substance (which
                     is usually in  solid form) can be separated from the reaction  solution by
                     crystallization.  Crystallization is one of the most common separation
                     techniques and is often used alone or in combination with one or  more of the
                     separation techniques  described above. In crystallization, a supersaturated
                     solution is created in which crystals of the desired compound  are formed.
                     Supersaturation depends on the solubility of the desired compound. If the
                     compound's  solubility increases with  temperature, supersaturatiori can be
                     achieved by  cooling the  solution. If the solubility is independent of or
                     decreases with temperature, then evaporating a portion  of the  solvent will
                     create supersaturation. "If neither cooling  nor evaporation is desirable,
                     supersaturation may be induced by adding a third component. The third
                     component forms a mix with the original  solvent in which the solute is
                     considerably less soluble" (USEPA 1979). If crystallization is done through
                     cooling of a solution there will be relatively little VOC emissions, especially
                     if the equipment is fully enclosed. "However, when crystallization is done by
                     solvent evaporation in a vacuum environment, there is a greater potential for
                     emissions" (USEPA 1993). Further  separation of the  crystals  from the
                     supersaturated solution can be done by centrifuging or filtration.

                     Purification

                     Once the intermediate or the bulk substance has been separated,  it may need
                     to be purified. Depending on the intermediate or the bulk substance produced,
                     there may be several  purification steps involved to produce the desired active
                     ingredient.  In vitamin production, for example, there are at least three to four
                     purification steps.  Purification  typically is achieved through additional
                     separation steps such as those described above. Purification is often achieved

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                Industrial Process Description
                    through recrystallization. Washing with additional solvents and filtration may
                    also be used.

                    Drying

                    The final step in the chemical synthesis process is drying of the intermediate
                    or final bulk substance. Drying is done by evaporating the solvents from the
                    solids. Solvents released from drying operations may be condensed for reuse
                    or disposal (USEPA 1993).

                    There are several different types of dryers used by the pharmaceutical industry
                    including tray dryers, rotary dryers, drum or tumble dryers, or pressure filter
                    dryers. "The  selection  of  the dryer type  depends  primarily on the
                    characteristics of the solid" (USEPA 1993).

                    Prior to 1980, probably the most common type of dryer used by the industry
                    was the vacuum tray dryer.  In a vacuum tray dryer, "the filtered solid is
                    placed on trays which are then manually stacked  on shelves in the dryer.
                    When the  dryer is  closed, the trays are heated to remove any liquids.   A
                    vacuum is applied within the dryer so that drying can  take place at lower
                    temperatures when needed" (USEPA, 1993).

                    More often today, tumble dryers or combination filter/dryers are used. In a
                    combination filter/dryer "the equipment not only acts as  a filter, but can also
                    function as a product dryer after the slurry has been compressed and filtered
                    into cake form. Heat is introduced to the filter/dryer through a hot gaseous
                    medium which is blown up through the cake until the desired level of dryness
                    is achieved" (USEPA 1993).  VOC emissions may occur since the gas will
                    entrain evaporated solvent which must be vented from the drying filter/dryer.

                    Tumble dryers consist of revolving conical shells ranging in capacity from 20
                    to 100 gallons. "The  rotation of the dryer tumbles the product to enhance
                    solvent evaporation and may also perform  a blending function" (USEPA
                    1979).  These dryers may be operated under a vacuum or using hot  air
                    circulation.  When operated under a vacuum, heat is supplied through
                    conduction from heated surfaces. Some air will pass through the equipment
                    due to inward leakage.   Thus, the  vacuum  exhaust  will  contain  VOCs
                    (USEPA, 1993).  A diagram of a simple tumble dryer is shown in Figure 8.
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                 Industrial Process Description
                  Figure 8: Cross-Section of Typical Tumble Dryer
                                                  Cover
                                                                Chain Casing
      Vacuum
      Connection
                                                                                Steam or
                                                                                Hot Water
                                                                                Inlet
                                                                               Concrete
                                                                               or Structural
                                                                               Foundation
    Source: Adapted from Control of Volatile Organic Compound Emissions from Batch Processes, EPA Guideline Series, 1993.
       Natural and Biological Product Extraction

                     Natural product extraction, as the name suggests, involves isolating an active
                     ingredient from natural sources, such as plants, roots, parasitic fungi or animal
                     glands. This process is often used to produce allergy relief medicines, insulin,
                     morphine, anti-cancer drugs, or other pharmaceuticals with unique properties.
                     Blood fractionation,  used to produce plasma,  is also part of the natural
                     product extraction process (USEPA 1995).  A simplified diagram of natural
                     product extraction processes and its associated wastes, is shown in Figure 9.

                     The desired active ingredient, usually present in raw materials at very low
                     concentrations, must be extracted for the final product. Therefore, a defining
                     characteristic of this process is that the volume of finished product is often an
                     order of magnitude smaller than that of the raw materials used. At each step
                     in the extraction process, the volume of material being processed is reduced
                     significantly.  This inherent nature of the process makes it an expensive one
                     to utilize (USEPA 1995).
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                 Industrial Process Description
    Figure 9: Simplified Process Flow Diagram for Natural/Biological Extraction
                          Organic Solvents
                          (mcthelyne chloride,
                          chloroform, alcohol,
                             toluene)
             Solvent vapors  \
            (phenol, chloroform, ';—
             methelyne chlor.)
                                                                To Compounding
                                                                 & Formulation
   Source: Adapted from Economic Impact and Regulatory Flexibility Analysis of Proposed Effluent Guidelines for the
   Pharmaceutical Manufacturing Industry, 1995.
                     Because of the large volume reductions involved, an assembly-line processing
                     method, consisting of several operation stations is used. At each subsequent
                     operation station, a little more of the inert material is removed and the active
                     ingredient is extracted. As the volume of material being processed decreases,
                     the size of the containers carrying the material also decreases, from containers
                     capable of carrying  75-100 gallons to, in some cases,  laboratory  size
                     equipment (USEPA 1995).

                     Active ingredients are recovered by precipitation, purification and solvent
                     extraction methods.  In precipitation, solubility is changed by pH adjustment,
                     salt formation, or addition of an anti-solvent.  Solvents are used as extractive
                     agents to remove the active ingredient from the raw materials, such as plant
                     and animal tissues. Solvents are also used to remove fats and oils, which may
                     contaminate the product (USEPA 1995).  Such solvents remove the fats and
                     oils,  without damaging the essential active ingredient(s) found in the  raw
                     materials.  Ammonia is also used in the extraction stages as a method of
                     controlling  the pH  when extracting  from  animal and  plant  sources.
                     Ammonium salts are used as buffering chemicals, and aqueous or anhydrous
                     ammonia is used as an alkalizing agent.  The high degree of solubility of
                     ammonium salts prevents unwanted precipitation.  Also, ammonium salts have
                     the advantage of not reacting with animal and/or plant tissues (USEPA 1995).
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                        Industrial Process Description
       Fermentation

                      Most steroids, antibiotics, and certain food additives (such as vitamins) are
                      commonly known Pharmaceuticals which are produced by fermentation.  In
                      fermentation,  microorganisms  (e.g., bacteria, yeast or fungi) are typically
                      inoculated in a liquid broth supplemented with nutrients that are acclimated
                      to an environment  (e.g.,  temperature,  pH, oxygen), conducive to rapid
                      growth).  These microorganisms produce the desired product (e.g., antibiotic,
                      steroid, vitamin, etc.) as a by-product of normal metabolism.  Fermentation
                      involves three main steps: 1) inoculum and seed preparation, 2) fermentation,
                      and 3) product recovery. A diagram of a fermentation process and the wastes
                      produced in this process is shown in Figure 10.


   Figure 10: Simplified Process Flow Diagram for the Fermentation Process
                              Gas
            Nutrients
          (sugars, starches) H20
 Solvents or
 Metal Salts
(MiBK, Cu, Zn)~
Organic Solvents
 (acetone, MiBK, _
1,2-dichloroethane)
                              Sludge
                              (sugars,
                          starches, fermentation
                           broths, com steep
                              liquor)
                                                                         .  Active
                                                                         Ingredient
                                                                             To Compounding &
                                                                                Formulation
   Source: Adapted from Economic Impact and Regulatory Flexibility Analysis of Proposed Effluent Guidelines for the
   Pharmaceutical Manufacturing Industry, 1995.
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                Industrial Process Description
                     Seed Preparation

                     The fermentation process begins with the introduction of the microbial strain
                     to a primary seed fermentation, which is commonly performed using shaking-
                     flask culture techniques at the laboratory scale.  Once grown, the suspension
                     is then transferred to further seed stages, which may be additional flask
                     fermentations, stirred tanks or both. The purpose of this "seed-train" is to
                     generate enough inoculum for the production fermentor (typically 1-10% of
                     the production tank volume). Generally, special seed tanks are used for the
                     fermentor inoculum which are miniature versions (1-10% of size) of the
                     production fermentor. If a seed tank becomes contaminated, it is emptied,
                     sterilized, and reinoculated.
                     Fermentation

                     Once the fermentor inoculum is ready, it is charged into a sterilized fermentor.
                     During fermentation, the fermentor is usually agitated and aerated.  The pH,
                     temperature, and dissolved oxygen content of the fermentation broth may be
                     monitored during fermentation. Fermentation may last from hours to weeks,
                     depending on the process. A fermentor "broth" is produced, which is then
                     filtered or centrifuged to separate out the solids (USEPA 1991).

                     Product Recovery

                     Filtration removes any larger residues from the broth, but it does not isolate
                     the active ingredient from the residues.  This must be done by product
                     recovery processes. Product recovery is achievable through three different
                     methods: solvent extraction, direct precipitation  and ion exchange, or
                     adsorption  (USEPA 1995).  Sometimes, the active material is contained
                     within the  cells of the microorganism.   Cell wall breakage by heat or
                     ultrasound,  for example, may be required to recover the material.

                     In solvent extraction the active ingredient is removed from the aqueous broth
                     by contacting it with an organic solvent,  in which the product is more soluble
                     than it is in water.  Removal of the active  agent from the solvent can be
                     achieved by crystallization (USEPA 1995).

                     The direct precipitation method of product recovery involves precipitation of
                     the active ingredient, as a metal salt from the broth using, for example, copper
                     (Cu) and/or zinc (Zn) as precipitating agents.  The actual choice of the
                     precipitating agent depends on the properties of the desired active ingredient.
                     The broth is then filtered and the product is recovered from the solid residues
                     (USEPA 1991).

                     Additionally, ion exchange or adsorption may be used for product recovery.
                     Ion exchange resin (or alternatively, activated carbon) is contacted with the
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                                   Industrial Process Description
                      broth and the product adsorbs onto the resin. The product is recovered from
                      the resin by using a solvent or by washing the resin with an acidic or basic
                      solution. It is then crystallized.

        III.A.3. Formulation, Mixing, and Compounding

                      "The primary objective of mixing, compounding, or formulating operations
                      are to convert the manufactured bulk substances into a final, usable form."
                      (USEPA 1995)   Figure 11 shows a simplified process flow diagram for
                      compounding,  formulation  and packaging.  Common dosage forms  of
                      pharmaceutical   products include tablets, capsules,  liquids,  creams and
                      ointments, as well as aerosols, patches and injectable dosages.  Table 6 lists
                      common pharmaceutical dosage forms and their uses.

   Figure 11: Simplified Process Flow Diagram for Compounding and Formulating
                                                   .-' Tablet
                                                  •    Dust
               Fugitive emissions,
                 vent emissions
           Non-Contact
          Cooling Water
                                           Solvent
                                        Emission - VOCs
                Wastewater
               (waste starches,
                  sugars
               BOD.COD.TSS)
Exeipients &
  Binders
(sugars, starches)
                                                   I	  Aqueous-based Solvents
                                            Tableting &
                                           Encapsulation
  Active Ingredient
      (Drug)
                                                         Tablets and
                                                          Capsules
Source: Adapted from Economic Impact and Regulatory Flexibility Analysis of Proposed Effluent Guidelines for the
Pharmaceutical Manufacturing Industry, 1995.
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                Industrial Process Description
                     As with the bulk manufacturing operations, many final products are produced
                     in batch utilizing a campaign regimen. At the end of the production campaign,
                     another product may be formulated and packaged using the same equipment
                     and the  same personnel.   Additionally,  formulation  and packaging is
                     performed in accordance with "good manufacturing practices" (GMP). GMP
                     is regulated by the FDA and sets forth the minimum methods to be used in,
                     and the facilities and controls to be used for the manufacture,  processing,
                     packing,  or holding of a drug to assure that such drug meets the safety
                     requirements and the quality and purity characteristics that it purports or is
                     represented to possess.

                     Following formulation, the finished product may be packaged at the same  site
                     or it may be transferred to another site. Packaging includes placing the final
                     formulated products into containers,  labeling, and preparing for shipping.
                     "The packaging components of a pharmaceutical product are vital to its safe
                     and effective use.  Besides serving the patient as a convenient unit of use, the
                     composite package (unit container, labeling, and shipping components) must
                     provide appropriate identification and necessary information for proper use
                     including warnings and (pre)cautions and preservation of the product's
                     chemical  and physical integrity" (Kirk-Othmer, 1994).

                     Batch production records are used and describe each manufacturing step in
                     detail.  At various  stages in the formulation and packaging process, quality
                     control checks are utilized. All raw materials are checked prior to use  in a
                     process and the final dosage forms require  a  myriad of tests to  assure
                     therapeutic benefit.  For example, the content uniformity, color, homogeneity,
                     dissolution, stability, identity, and potency of the product must be determined
                     and meet  stated ranges. Representative samples are collected at the end of the
                     formulation stage  and submitted to  the chemical  and/or microbiological
                     laboratories for final assaying.  Representative samples are also  collected
                     during packaging operations. The quality control unit of the pharmaceutical
                     manufacturing company has the responsibility and authority to approve or
                     reject all  raw materials, in-process materials, packaging materials including
                     containers, closures, and labeling materials, as well as the final product.

                     The equipment used to formulate and package the final product is cleaned,
                     maintained, and sanitized at appropriate intervals. Actual maintenance  and
                     cleaning  schedules and results are documented.  As described under bulk
                     manufacturing, the methods, equipment, and materials used (e.g.,  water
                     wash,  steam,  detergents,  organic solvents) to clean the equipment  are
                     specified  on a per product basis.
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                 Industrial Process Description
Dosage
Form

powders, bulk
effervescent
insufflation
lyophilizcd
capsules
troches,
lozenges
compressed
tablets
pellets
coated tablets

syrups
spirits
collodions
parcnteral
solutions
ophthalmic
nasal
mouthwash,
gargles
inhalations


suspensions
emulsions,
lotions

ointments
pastes and
cerates
suppositories
Table 6: Pharmaceutical Dosage Forms
Constituents, properties
Solids
comminuted or blended, dissolved or mixed with water
CO2-releasing base ingredients
insufflator propels medicated powder into body cavity
rcconstitution by pharmacist of unstable products
small-dose bulk powder enclosed in gelatin shell, active ingredient plus diluent
prepared by piping and cutting or disk candy technology; compounded with
glycerogelatin
dissolved or mixed with water, great variety of shapes and formulations
for prolonged action
coating protective, slow release
Liquid Solutions
sweetener, solvent, medicinal agent
alcohol, water, volatile substances
pyroxylin in ether, medicinal agent (castor oil, camphor)
sterile, pyrogen-free, isotonic, pH close to that of blood; oily or aqueous
solution
sterile, isotonic, pH close to that of tears; viscosity builder
aqueous, isotonic, pH close to that of nasal fluids; sprays or drops
aqueous, antiseptic
administered with mechanical devices

Liquid Dispersions
powder suspended in water, alcohol, glycol, or an oil
oil-in-water or water-in-oil
Semisotid and plastic dispersions
hydrocarbon (oily), adsorptive water-washable, or water-soluble bases;
emulsifying agents, glycols, medicating agent
ointments with high dispersed solids and waxes, respectively
thcobroina oil, glyeinerated gelatin, or polyethylene glycol base plus medicinal
agent
Uses

external, internal
oral
body cavities
various uses including
parenteral and oral
internal
slow dissolution in mouth
oral and external
implantation
oral

flavoring agent, medicinal
flavor or medicinal
external for corns and
bunions
intravenous, intramuscular,
subcutaneous injection
eye treatment
nose treatment
refreshment, short term
bacterial control
medication of trachea or
bronchioles

oral dosing, skin application
oral, external or injection

external
external
insertion into body cavity
Source: Adapted from Zanowaik, P., 1995, "Pharmaceuticals " in Kirk-Othmer, Encyclopedia of Chemical Technology,
vol. 18, 4th edition.
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                Industrial Process Description
       Tablets
                     Tablets account for the majority of solid medications taken orally in the
                     United States.  "Tablets can be made to achieve rapid drug release or to
                     produce delayed, repeated or prolonged therapeutic action" (Kirk-Othmer,
                     1994).  Tablets can be compressed or molded, and may be coated.

                     To prepare a tablet, the active pharmaceutical ingredient is combined with a
                     filler, such as sugar or starch, and a binder, such as corn syrup or starch. The
                     filler is added to ensure that the active  ingredient is diluted to the proper
                     concentration. A binder is  needed  to  bind tablet particles together. A
                     lubricant, such as magnesium sterate or polyethylene glycol, may be added to
                     facilitate equipment operation, or to slow disintegration or dissolution of the
                     active ingredient.

                     Tablets are produced by compression of powder blends or granulations. In
                     direct compression, the ingredients are blended and then compressed into the
                     final tablet without modifying the physical nature of the material itself.  "The
                     most widely used and most general method of tablet preparation is the wet-
                     granulation method" (Remington,  1995).   In wet granulation, the active
                     ingredient is powdered and mixed with the filler.  This mixture is then wetted
                     and blended with the binder, forming a solution. Coarse granules form which
                     are mixed with lubricants such as magnesium stearate and then compressed
                     into tablets. Slugging or dry granulation is used when tablet ingredients are
                     sensitive to moisture or temperatures associated with  drying or when the
                     tablet ingredients have sufficient inherent binding or cohesive properties. Dry
                     granulation includes weighing, mixing, slugging, dry screening, lubrication,
                     and compression.  Slugging requires large heavy presses to compress larger
                     tablets, between 20-30 grams in weight. These large tablets are then ground
                     and screened to a desired mesh size then recompressed into final tablets
                     (USEPA, 1991).

                     Coating may be used to offer protection from moisture, oxygen, or light, to
                     mask unpleasant taste or appearance, and to impart  distinctive colors to
                     facilitate patient recognition.  "Enteric coatings are used to delay the release
                     of the active ingredient in the stomach  and prolong therapeutic activity.  The
                     latter are used for drugs that are unstable to gastric pH or enzymes,  cause
                     nausea and vomiting, or irritation to the stomach, or should be present in high
                     concentrations in the intestines" (Kirk-Othmer, 1994).  Coating is done in a
                     rotary drum.  The coating  solution  is poured  onto the  tablets.   In many
                     operations,  aqueous coating solutions are now used instead of solvent based
                     (usually  methylene chloride) solutions.   As the drum rotates, the tablets
                     become coated.  Once coated, they are dried  in the drum and may be sent to
                     another rotary drum for polishing. Polishing works by the friction created
                     when the tablets rotate and rub against each other.  Un-coated tablets may
                     also be polished.
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                 Industrial Process Description
       Capsules
                     Once the tablets pass quality control requirements, they may be held or sent
                     directly to packaging. Coated tablets are stamped with identifying information
                     (e.g., brand name, code number) in a rotary ink press.
                     After tablets,  the most common solid  oral dosage form is the capsule.
                     Capsules come in soft and hard shelled varieties. Hard capsules or "dry-filled"
                     capsules are formed by dipping metal pins into a solution of gelatin of a
                     specific temperature.  The temperature controls the viscosity of the gelatin
                     and hence the thickness of the capsule walls.  When the pins are removed
                     from the solution, a hard coating of gelatin forms on the pins. The  coating is
                     dried and trimmed.  "These capsules are  filled by introducing the powdered
                     material into the longer end or body and the capsule and then slipping on the
                     cap." (Remington, 1995)

                     Soft shelled capsules are formed by placing two continuous gelatin films
                     between rotary die plates. As the plates are brought together, the two gelatin
                     films join and seal, forming the two halves of the capsule.  As the two halves
                     join, the ingredients, which can be a liquid, paste or powder, are injected into
                     the capsules. "Commercially filled soft gelatin capsules come in a wide choice
                     of sizes and shapes: they may be round,  oval, oblong, tube or suppository-
                     shaped" (Remington).
       Liquid Dosage
                     In formulating a liquid product, the ingredients are first weighed and then
                     dissolved in an appropriate liquid. The solutions are mixed in glass-lined or
                     stainless steel vessels, after which they are stored  in tanks before final
                     packaging.  Preservatives may be added to prevent mold and bacterial growth.
                     If the liquid  will be used for injection  or ophthalmic use, sterilization  is
                     required.   In this  case, the container,  which has  also been  previously
                     sterilized/depyrogenated, is filled with liquid which has either been rendered
                     sterile by aseptic filtration in a sterile environment and/or the entire container
                     and its contents are terminally heat sterilized in an autoclave.
       Ointments and Creams
                     Ointments are usually made by blending the bulk active ingredient with a base,
                     such as a petroleum derivative or wax.  The mixture is cooled, rolled out, and
                     poured into tubes by machines and packaged (USEPA, 1991).

                     Creams are semisolid emulsions and are either oil-in-water or water-in-oil,
                     rather than being petroleum based.  "Generally, the ingredients of the two
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                Industrial Process Description
                    phases are heated separately, then are mixed and stirred vigorously to achieve
                    emulsification" (Kirk-Othmer, 1994).

                    As with all other dosage forms, equipment is washed and cleaned based on
                    batch record requirements.  However, because of the greasy  nature of
                    ointment and cream production, cleaning often is done with detergents.
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                Industrial Process Description
Ifl.B. Raw Material Inputs and Pollutant Outputs
                     Pharmaceutical batch processes use numerous raw materials and generate
                     wastes and emissions. In general, the waste and emissions generated depend
                     on the raw materials and  equipment used,  as well as the manufacturing
                     process employed.  In designing bulk manufacturing processes, consideration
                     is given to the availability of the starting materials and their toxicity, as well
                     as the wastes (e.g., mother liquors, filter residues, and other by-products) and
                     the emissions generated.  A description of some of the considerations given
                     is provided in Section V, Pollution Prevention Opportunities.

                     When bulk manufacturing reactions are complete,  the solvents are physically
                     separated from the resulting product. Due to purity concerns, solvents  often
                     are not reused in a pharmaceutical process.   They may be sold for non-
                     pharmaceutical uses, used for fuel blending operations, recycled, or destroyed
                     through incineration.

                     This  section describes the raw materials and associated waste streams and
                     some of the more common technologies used to control these wastes. Much
                     of this information is summarized in Table 7.
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Table 7: Summary of Typical Material Inputs and Pollution Outputs in the Pharmaceutical Industry
Process
Chemical
Synthesis
- Reaction
- Separation
- Purification
- Drying
Natural Product
Extraction
Fermentation
Formulation
Inputs (examples of
some commonly used
chemicals provided)
Solvents, catalysts,
reactants, e.g. benzene,
chloroform, methylene
chloride, toluene,
methanol, ethylene glycol,
methyl isobutyl ketone
(MiBK), xylenes,
hydrochloric acid, etc.
Separation and extraction
solvents, e.g.. methanol,
toluene, hexanes, etc.
Purification solvents e.g..
methanol, toluene,
acetone, hexanes, etc.
Finished active drug(s) or
intermediates
Plants, roots, animal
tissues, extraction
solvents, e.g.. ammonia,
chloroform, phenol,
toluene, etc.
Inoculum, sugars,
starches, nutrients,
phosphates, fermentation
solvents, e.g.. ethanol,
amyl alcohol, methanol,
MiBK, acetone, etc.
Active drug, binders
(starches), sugar, syrups,
etc.
Air Emissions
VOC emissions from
reactor vents, manways,
material loading and
unloading, acid gases
(halogen acids, sulfur
dioxide, nitrous oxides);
fugitive emissions, from
pumps, sample
collections, valves, tanks
VOC emissions from
filtering systems which
aren't contained; and
fugitive emissions from
valves, tanks and
centrifuges
Solvent vapors from
purification tanks; fugitive
emissions
VOC emissions from
manual loading and
unloading of dryers
Solvent vapors & VOC's
from extraction chemicals
Odoriferous gases,
extraction solvent vapors,
particulates
Tablet dusts, other
particulates
Wastewater
Process waste waters with
spent solvents, catalysts,
reactants; pump seal waters,
wet scrubber wastewater;
equipment cleaning
wastewater; wastewater maybe
high in BOD, COD, TSS with
pH of 1-11.
Equipment cleaning wash
waters, spills, leaks, spent
separation solvents
Equipment cleaning wash
waters, spills, leaks, spent
purification solvents
Equipment cleaning wash ,
waters, spills, leaks
Equipment cleaning wash
waters, spent solvents
(ammonia); natural product
extraction wastewater have low
BOD, COD, TSS and pH of 6-
8.
Spent fermentor broth,
fermentation wastewater
containing sugars, starches,
nutrients, etc.; wastewater
tends to have high BOD, COD,
TSS and have pH of 4-8.
Equipment cleaning wash
waters (spent solvents), spills,
leaks; wash waters typically
contain low levels of BOD,
COD, TSS and have pH of 6-8.
Residual
Wastes
Reaction residues
and reactor bottom
wastes



Spent raw
materials (plants,
roots etc.)
Waste filter cake,
fermentation
residues
Particulates, waste
packaging,
rejected tablets,
capsules etc.
 Source: Development Document for Proposed Effluent Limitations Guidelines and Standards for the Pharmaceutical
 Manufacturing Point Source Category, US EPA, Washington, DC., February 1995.
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Pharmaceutical Industry
                 Industrial Process Description
       IH.B.l. Raw Materials
                     "The pharmaceutical manufacturing industry draws upon worldwide sources
                     for the myriad of raw materials it needs to  produce medicinal chemicals.
                     Fermentation operations require many new raw materials falling into general
                     chemical classifications such as  carbohydrates, carbonates, steep liquors,
                     nitrogen, and phosphorus compounds, anti-foam agents, and various acids and
                     bases.  These chemicals are used as carbon  and nutrient sources, as foam
                     control additives, and for pH adjustment in fermentation processes. Various
                     solvents, acids, and bases are also required for extraction and purification
                     processes.

                     Hundreds of raw materials are required for the chemical synthesis processes
                     used by the industry.  These include organic and inorganic compounds and are
                     used in gas, liquid, and solid forms. Plant and animal tissues are also used by
                     the pharmaceutical manufacturing industry to produce various biological and
                     natural extraction products" (EPA, 1995).

                     Each manufacturing or formulation plant is special, differing from other
                     similar pharmaceutical plants in size, types of intermediates, bulk substances,
                     or products produced, amounts and types of solvents used, and thus, in the
                     raw materials  used  and  wastes/emissions   generated.    Most  bulk
                     pharmaceutical reactions  require organic solvents  to  dissolve  chemical
                     intermediates  and reagents.   Because of  the  high reactivity of many
                     pharmaceutical reagents and intermediates, pharmaceutical solvents must be
                     non-reactive, provide an  environment which allows efficient heat transfer
                     during  endothermic or exothermic reactions, and facilitate efficient electron
                     transfer. Often halogenated solvents, such as methylene chloride, provide the
                     optimum choice for pharmaceutical reactions.   The most commonly  used
                     solvent in the pharmaceutical industry is methanol, an oxygenated organic
                     solvent. Other common solvents used are ethanol, acetone, and isopropanol.
                     Tables 8,  9, and 10 show the typical solvents (and whether or not they are
                     priority pollutants or hazardous  air pollutants) used in chemical synthesis,
                     biological and natural extraction, and fermentation processes, respectively.

                     Final bulk substances  from the bulk manufacturing  processes are used in
                     formulation operations, along with other raw materials or ingredients.  The
                     production of these ingredients is described under Section III. A.2.
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Pharmaceutical Industry
                                             Industrial Process Description
Table 8: Solvents Used in the Chemical Synthesis Process
Chemical
Acetone
Acetonitrile
Ammonia (aqueous)
n-Amyl acetate
Amyl Alcohol
Aniline
Benzene
2-Butanone (MEK)
n-Butyl acetate
n-Butyl alcohol
Chlorobenzene
Chloroform
Chloromethane
Cyanide
Cyclohexane
o-Dichlorobenzene (1,2-
Dichlorobenzene)
1 ,2-Dichlorobenzene
Diethylamie
Diethyl Ether
NJ-J-Dimethyl acetamide
Diethylamine
NJN-Dimethylaniline
N,N-Dimethylformamide
Dimethyl sulfoxide
1 ,4-Dioxane
Ethanol
Ethvl acetate
Priority
Pollutant Under
the Clean
Water Act






X



X
X
X
X

X
X










Hazardous
Air Pollutant
under the
Clean Air Act

X



X
X
X


X
X
X








X
X

X


Chemical
Ethylene glycol
Formaldehyde
Formamide
Furfural
n-Heptane
n-Hexane
Isobutyraldehyde
Isopropanol
Isopropyl acetate
Isopropyl ether
Methanol
Methylamine
Methyl cellulose
Methylene chloride
Methyl formate
Methyl isobutyl ketone
(MiBK)
2-Methylpyridine
Petroleum naphtha
Phenol
Polyethylene glycol
600
n-Propanol
Pyridine
Tetrahydrofuran
Toluene
Trichlorofloromethane
Triethylamine

Priority
Pollutant
Under the
Clean Water
Act













X




X




X



Hazardous
Air Pollutant
under the
Clean Air
Act
X
X



X




X


X

X


X




X

X
x
Source: adapted from
Manufacturing Point
Development Document for Proposed Effluent Guidelines and Standards for the Pharmaceutical
Source Category, 1995 and US Environment Laws, 1994.
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Pharmaceutical Industry
                 Industrial Process Description
Table 9: Solvents Used in Biological and Natural Product Extraction
Chemicals
Acetone
Acctonitrilc
Ammonia (aqueous)
n-Amyl acetate
Amyl alcohol
n-Butyl alcohol
Chloroform
1 ,2-Dichlorocthanc
Dicthylaminc
Dicthyl ether
N,N-Dicthylformamide
Dimethyl sulfoxide
1 ,4-Dtoxane
Ethanol
Ethvl acetate
Priority
Pollutants
under the Clean
Water Act






X
X







Hazardous
Air Pollutants
under the
Clean Air Act

X




X



X

X


Chemicals
Ethylene glycol
Formaldehyde
n-Heptane
n-Hexane
Isopropanol
Isopropyl acetate
Isopropyl ether
Methanol
Methylene
chloride
Petroleum
naphtha
Phenol
n-Propanol
Pyridine
Tetrahydrofuran
Toluene
Priority
Pollutants
under the Clean
Water Act








X

X



X
Hazardous
Air Pollutants
under the
Clean Air Act
X
X

X



X
X

X



X
Source: adapted from Development Document for Proposed Effluent Guidelines and Standards for the Pharmaceutical
Manufacturing Point Source Category, 1995 and US Environment Laws, 1994.
Table 10: Solvents Used in Fermentation Processes
Chemicals
Acetone
Acctonitrilc
Ammonia (aqueous)
n-Amyl acetate
Amyl alcohol
n-Butyl acetate
n-Butyl alcohol
Chloroform
N,N-
Diethylformamidc
Ethanol
Ethyl acetate
Formaldehyde
Priority
Pollutants Under
the Clean Water
Act







X




Hazardous
Air Pollutants
under the
Clean Air Act

X





X
X


X
Chemicals
n-Heptane
n-Hexane
Isopropanol
Isopropyl acetate
Methanol
Methyl cellulose
Methylene
chloride
Methyl
isobutane ketone
(MiBK)
Petroleum
naphtha
Phenol
Toluene
Triethvlamine
Priority
Pollutants Under
the Clean Water
Act






X


X
X

Hazardous
Air Pollutants
under the
Clean Air Act

X


X

X
X

X
X
X
Source: adapted from Development Document for Proposed Effluent Guidelines and Standards for the Pharmaceutical
Manufacturing Point Source Category, 1995 and US Environment Laws, 1994.
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Pharmaceutical Industry
                Industrial Process Description
       IH.B.2. Air Emissions and Control Systems

                     Both gaseous organic and inorganic compounds, as well as particulates, may
                     be emitted during pharmaceutical manufacturing and formulation. Some of
                     the volatile organic compounds (VOC) and inorganic gases that are emitted
                     are classified as hazardous air pollutants (HAPs) under the Clean Air Act.

                     The type and amount of emissions generated are dependent on the operations
                     conducted by the facility, as well  as how the product is manufactured or
                     formulated.  "Each (pharmaceutical) plant is unique, differing from other
                     plants in size, types of products manufactured, amounts  and types of VOC
                     used, and air pollution control problems encountered" (EPA, 1979).

       Bulk Manufacturing

                     As previously described, the industry manufactures most bulk pharmaceutical
                     substances and intermediates in campaigns via batch processes. Following the
                     completion of one campaign,  another bulk  substance  or  intermediate  is
                     typically made using the same equipment (e.g., reactors, filters, dryers).   The
                     reactants and solvents used in manufacturing the next  bulk  substance or
                     intermediate may vary greatly from the ones previously used. While some
                     reactions may require the use of halogenated solvents, the next reaction may
                     use another solvent or no solvent at all.

                     This wide variations in bulk manufacturing makes predicting typical or annual
                     average emissions difficult.  This is  because the emission generated are
                     predicated on what bulk substance or intermediate is manufactured and over
                     what length of time, and which equipment and raw materials are used. Some
                     bulk substances and intermediates are made frequently, while others may be
                     made only once every two to three years over a one to two  week period. This
                     has  often prevented the calculation  of  typical  emission  rates for each
                     operation. However, an approximate ranking of emission sources has been
                     established by EPA and is presented below in order of decreasing magnitude.
                     The first four sources generally will account for the majority of emissions
                     from a bulk manufacturing plant.
                                   Dryers
                                   Reactors
                                   Distillation units
                                   Storage and transfer of materials
                                   Filtration
                                   Extraction
                                   Centrifugation
                                   Crystallization
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Pharmaceutical Industry
                 Industrial Process Description
                     Dryers  are  one  of the  largest sources  of VOC emissions  in  bulk
                     manufacturing. In addition to the loss of solvent during drying, manual
                     loading and unloading of dryers can release solvent vapors into ambient air,
                     especially when tray dryers are used. VOCs are also generated from reaction
                     and separation steps via reactor vents and manways.  Centrifuges may be a
                     source of VOC emissions,  especially in top loading types, where solids are
                     manually scooped out.

                     Typical controls for these emission sources, excluding storage and transfer
                     operations, include condensers, scrubbers, carbon absorbers and, on occasion,
                     incinerators.   "Storage  and transfer emissions  can be controlled  by vapor
                     return lines, vent condensers, conservation vents, vent scrubbers, pressure
                     tanks and carbon absorbers.  Floating roofs may be feasible controls for large
                     vertical storage tanks" (EPA, 1979).
       Formulation
                     Both particulates and VOCs may be formed during mixing, compounding,
                     formulation, and packaging steps. Because these compounds may pose a
                     danger to workers, through direct inhalation, they are a principal concern.
                     Depending on the process and the batch record requirements, the particulates
                     (e.g.,  tablet dusts) may be recycled back into the  formulation process.
                     However, sometimes the particulates are collected for destruction or disposal.

                     As in  bulk  manufacturing, the type and quantity  of compounds emitted
                     depends on the operation. For example, formulation facilities may or may not
                     emit VOCs.  Some formulation operations do not require the use of solvents,
                     some  may only use solvents for cleaning,  and some may use  solvents in
                     granulation and coating operations. In some facilities, organic compounds,
                     such as ethanol or isopropyl alcohol, might be used in the formulation of the
                     product and VOCs may  be emitted during mixing,  formulation,  and/or
                     packaging.
       Air Pollution Control Equipment
                    More than one type of air control equipment may be used at any one time in
                    any one facility. A description of the various equipment used by the industry
                    is provided below.

                    Condensers. Condensers are widely used in the pharmaceutical industry to
                    recover solvents from process operations (a process condenser) and as air
                    pollution  control devices  to  remove VOCs from vented gases.  Process
                    condensers differ from condensers used as air pollution control devices as the
                    primary purpose of a process condenser is to recover material as an integral
                    part of a unit operation. The process condenser is the first condenser located
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Pharmaceutical Industry
                Industrial Process Description
                    after the process equipment and supports a vapor-to-liquid phase change for
                    the vapors  produced in the process  equipment.   Examples  of process
                    condensers  include  distillation condensers,  reflux  condensers,  process
                    condensers in line before the vacuum source, and process condensers used in
                    stripping or flashing operations. The primary purpose of a condenser used
                    as an air pollution control device is to remove VOCs prior to venting.

                    Condensation is the process of converting a gas or vapor to liquid.  In this
                    method, gas streams from vents containing VOCs are cooled to below their
                    saturation temperatures, converting the gas into a VOC liquid.  This removes
                    some VOCs from the gas, but some remains. The amount of VOCs remaining
                    in the gas depends on the temperature and vapor-liquid equilibrium of the
                    VOC.   Lowering the temperature  of the condenser generally lowers  the
                    content of VOC in the gas stream.

                    "In the most common type, surface condensers, the coolant does not directly
                    contact condensable vapors, rather heat is transferred across a surface (usually
                    a tube wall) separating vapor and coolant.  In this way the coolant is  not
                    contaminated with condensed VOC and may be directly reused. The type of
                    coolant used depends on the  degree  of cooling needed for a particular
                    situation" (EPA, 1979). Coolants in common use are water, chilled water,
                    brine, and glycol.

                    Scrubbers.  Scrubbers or gas absorbers are used  to remove one or more
                    constituents from a gas stream by treatment with a liquid.  "Absorption is
                    important in the pharmaceutical industry because  many VOCs and other
                    chemicals being used are soluble in water or aqueous solutions. Therefore,
                    water,  caustic or acidic scrubbers can be applied to  a variety of air pollution
                    problems" (USEPA 1979).

                    When using a scrubber as an air pollution control device, the solubility of the
                    constituents in the gas stream in the absorbing liquid must be determined.
                    "The rate of transfer of the soluble  constituents from the gas to the liquid
                    phase is determined by diflusional processes occurring on each side of the gas
                    liquid interface" (Theodore and Bonicore, 1989).

                    The main types of scrubbers used  are packed tower, plate or tray tower,
                    venturi scrubber, and spray tower.  Each type of scrubber is designed to
                    provide intimate  contact between  the  scrubbing  liquid and the  gaseous
                    constituents so that mass transfer between phases is promoted. The degree
                    of control achieved is dependent on the residence time of the gas and liquids,
                    the interfacial area, and the physical and thermodynamic properties of the
                    VOC species involved.
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Pharmaceutical Industry
                Industrial Process Description
                    Combustion or Incineration. Another method used for controlling VOC
                    emissions is combustion or incineration.  "In general, factors that influence
                    the efficiency of combustion are: (1) temperature, (2) degree of mixing, (3)
                    residence time in the combustion chamber, and (4) type of VOC combusted.
                    Since more waste streams contain dilute VOC concentrations, they require
                    that supplemental  fuel maintain the necessary combustion temperatures"
                    (EPA,  1979).  Although combustion  systems  can achieve  high  removal
                    efficiencies, these systems are typically more expensive to install, operate, and
                    maintain, and have secondary emissions associated with their operation.
                    Additionally, a scrubber may be required to control inorganic gases produced
                    as by-products of combustion.

                    "Equipment used to control waste gases by combustion can be divided into
                    three categories:  direct combustion  or flaring (not often used by the
                    pharmaceutical industry), thermal oxidation, and catalytic oxidation.  A direct
                    combustor or flare is a device in which air and all the combustible waste gases
                    react at the burner. In contrast, in thermal oxidation, the combustible waste
                    gases pass over or around a burner flame into a residence chamber where
                    oxidation of the waste gases is completed. Catalytic oxidation is very similar
                    to thermal oxidation.  The main difference is that after passing through the
                    flame area, the gases pass over a catalyst bed which promotes oxidation at a
                    lower temperature than does thermal oxidation" (Theodore and Buonicore,
                    1989).  Efficiency rates of catalytic oxidizers in destroying VOCs can reach
                    close to 98% (Buonicore and Davis, 1992).

                    Adsorption. Adsorption is  another method for  removing VOCs from gas
                    streams.  This method filters out the volatiles by passing them through a
                    packed column of activated carbon, silicates, aluminas, aluminosilicates, or
                    any other surface which is porous and has a microcrystalline structure. As the
                    gas stream passes through the column, the VOCs adsorb to the surface of the
                    media. The adsorption material in the column eventually becomes saturated,
                    and must be either regenerated  or disposed.   Most sorbents  may  be
                    regenerated repeatedly by passing hot gas or steam through the bed. VOCs
                    will desorb into the  gas or steam. The high VOC concentration in the gas or
                    steam can then be removed through condensation. Adsorption can be about
                    98% efficient in removing VOCs in the waste gas stream (Crume and Portzer,
                    1992).

       ffl.B.3. Wastewater

                    Pharmaceutical manufacturers use water for process operations, as well as for
                    other non-process purposes. However, the use and discharge practices and
                    the characteristics  of the wastewater will vary depending on the operations
                    conducted at the facility.  Additionally,  in some cases, water may be formed
                    as part of a chemical reaction.
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Pharmaceutical Industry
                Industrial Process Description
                    Process water includes any water that, during manufacturing or processing,
                    comes into direct contact with or results from the use of any raw material or
                    production of an intermediate, finished product, byproduct, or waste. Process
                    wastewater includes water that was used or formed during the reaction, water
                    used to  clean process equipment and floors,  and pump  seal water.  Non-
                    process wastewater includes noncontact cooling water (e.g., used in heat
                    exchangers), noncontact  ancillary  water (e.g., boiler blowdown,  bottle
                    washing), sanitary wastewater,  and wastewater from other sources (e.g.,
                    storm water runoff).

                    Based on the responses from 244 facilities to a 1990 308 Questionnaire, EPA
                    estimated the average daily wastewater generation by the pharmaceutical
                    manufacturing industry to be 266 million gallons. Additionally, EPA learned
                    that more than half of the responding  facilities have implemented  water
                    conservation  measures. Such measures include: careful monitoring of water
                    use,  installation of automatic monitoring and  alarm systems or in-plant
                    discharges, implementation of alternative production processes, reuse of non-
                    contact water  as process makeup water and treatment of contact cooling
                    water to allow  reuse.

                    Pharmaceutical manufacturers generate process wastewater containing a
                    variety of conventional parameters (e.g., BOD, TSS, and pH) and other
                    chemical constituents.    The  top ten chemicals  discharged by  the
                    pharmaceutical industry are provided in Table 11. Of these compounds, two
                    are "priority pollutants"3.  The top four compounds are oxygenated organic
                    solvents (e.g., methanol, ethanol, acetone, and isopropanol).
       Priority pollutants are the pollutants listed in 40 CFR part 403, Appendix A.
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Pharmaceutical Industry
                Industrial Process Description
Table 11: Chemicals Discharged in Wastewater by the Pharmaceutical
Manufacturing Industry
Constituent Name
Methanol
Ethanol
Acetone
Isopropanol
Acetic acid
Methylene chloride
Formic acid
Ammonium hydroxide
N(N-Dimethylacetamide
Toluene
Quantity
Discharged (Ibs/yr)
15,388,273
6,802,384
4,573,766
4,565,370
4,328,691
3,590,640
2,136,059
1,365,741
1,046,333
783,364
Percent of Total
Loading
28
12
8.4
8.4
7.9
6.6
3.9
2.5
1.9
1.4
# of Facilities Reporting
Constituents
82
97
55
85
44
47
9
32
7
43
Source: adapted from Development Document for Proposed Effluent Guidelines and Standards for the Pharmaceutical
Manufacturing Point Source Category, 1995 and US Environment Laws, 1994.

                     Most process wastewater receives some treatment, either in-plant at the
                     process unit prior to commingling with other facility wastewater or prior to
                     discharge to a permitted outfall.  Table 12 provides a trend analysis prepared
                     by EPA of wastewater treatment technologies used by the pharmaceutical
                     industry. EPA found that "since 1986, the use of neutralization, equalization,
                     activated sludge, primary clarification, multimedia filtration, steam stripping,
                     secondary clarification, granular activated carbon, and  oxidation have all
                     increased, while the use of aerated lagoons, chlorination, waste stabilization
                     ponds, and trickling filters have decreased slightly" (USEPA 1995).

                     More  than half of the  surveyed  facilities provide  pH adjustment  or
                     neutralization to adjust the pH prior to discharge.   Additionally, because
                     wastewater treatment can  be  sensitive to  spikes  of high flow  or  high
                     constituent concentration, many treatment  systems include equalization.
                     Advanced biological treatment is used to treat biochemical oxygen demand
                     (BOD5), chemical oxygen demand (COD), total suspended solids (TSS), as
                     well as various organic constituents.  Biological systems can be divided into
                     two basic types: aerobic (treatment takes place in the presence of oxygen) and
                     anaerobic (treatment takes  places in the absence of oxygen).  Very few
                     pharmaceutical facilities (only two) use anaerobic treatment. However, more
                     than 30 percent use aerobic systems such as activated sludge, aerated lagoons,
                     trickling filter, and rotating biological contactors (RBC).
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Pharmaceutical Industry
                 Industrial Process Description
Table 12: Wastewater Treatment Technology Trends
Treatment Technology
Neutralization
Equalization
Activated sludge
Settleable solids removal
Primary sedimentation
Aerated lagoon
Primary clarification
Chlorination
Polishing ponds
Waste stabilization pond
Trickling filter
Multimedia filtration
Stream stripping
Evaporation
Secondary clarification
Granular activated carbon
Oxidation
Dissolved air flotation
pH adjustment
Phase separation
Percentage of Facilities Using
Technology Prior to 1986
26.0
20.1
16.9
13.3
12.0
7.5
3.9
3.6
3.2
2.9
2.9
2.3
1.9
1.9
1.6
1.3
1.0
1.0
NA
NA
Percentage of Facilities Using
Technology in 1989/1990
44.3
28.6
20.5
NA
NA
4.9
9.8
2.5
NA
2.5
2.0
6.1
5.7
NA
20.9
3.3
2.0
NA
50.0
12.3
        Note: Total percentage is not 100 because facilities may use multiple treatment technologies.
        NA - Not available.

        Source: adapted from Development Document for Proposed Effluent Guidelines and Standards for the
        Pharmaceutical Manufacturing Point Source Category, 1995 and US Environment Laws, 1994.

                      Although the pharmaceutical industry has routinely utilized recovery systems
                      to recover and reuse solvents, only four facilities were identified by EPA as
                      using stream  stripping to  remove  gases and/or organic  chemicals from
                      wastewater streams.  Sixty one facilities were identified that use distillation
                      either to recover a specific solvent from a process stream or to treat one or
                      more process waste streams. However, according to PhRMA, it is likely that
                      these facilities use this method to recover a specific solvent from a specific
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Pharmaceutical Industry
                Industrial Process Description
                     process stream rather than to treat wastewater from numerous operations
                     since the treatment technology is not applicable to the wide range of waste
                     characteristics common in the pharmaceutical industry.

       in.B.4. Solid Wastes

                     Both nonhazardous and  hazardous  wastes are generated  during all three
                     stages of pharmaceutical manufacturing. These wastes can include off-spec
                     or obsolete raw materials or products, spent solvents, reaction residues, used
                     filter media, still bottoms, used chemical reagents, dusts from filtration or air
                     pollution control equipment, raw material packaging  wastes, laboratory
                     wastes, spills, as well as wastes generated during packaging of the formulated
                     product.

                     Filter cakes and spent raw materials (plants, roots, animal tissues etc.) from
                     fermentation and natural product extraction are two of the largest sources of
                     residual wastes in the pharmaceutical industry. Other wastes include reaction
                     residues and filtrates from chemical synthesis processes. These wastes may be
                     stripped of any solvents which remain in them, and then disposed as either
                     hazardous or nonhazardous wastes. Typically, solid wastes are shipped off-
                     site for disposal or incineration.

                     A number of practices are implemented by the industry to  reduce waste
                     generation  and  material  losses.   Typical  practices  include  process
                     optimization, production scheduling, materials tracking and inventory control,
                     special material handling and storage procedures, preventive maintenance
                     programs, and waste stream segregation.
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Pharmaceutical Industry
                Industrial Process Description
IILC. Management of TRI Chemicals in the Production Process

                    The Pollution Prevention Act of 1990 (PPA) requires facilities to report
                    information about  the management of Toxics Release Inventory (TRI)
                    chemicals in waste and efforts made to eliminate or reduce those quantities.
                    These data have been collected annually in Section 8 of the TRI reporting
                    Form R beginning with the 1991 reporting year. The data summarized below
                    cover the years  1994 through  1997 and are meant to  provide a basic
                    understanding of the quantities of waste handled by the industry, the methods
                    typically used to manage this waste, and recent trends in these methods.  TRI
                    waste management data  can be used to assess trends in source reduction
                    within individual industries and facilities, and for specific TRI chemicals.  This
                    information could then be used as a tool in identifying opportunities for
                    pollution prevention compliance assistance activities.

                    While the quantities reported for 1994 and 1995 are estimates of quantities
                    already managed, the quantities reported for 1996 and 1997 are projections
                    only. The PPA requires these projections to encourage facilities to consider
                    future waste generation and source reduction of those quantities as well as
                    movement up the waste management hierarchy. Future-year estimates are not
                    commitments that facilities reporting under TRI are required to meet.

                    Table 13  shows that  the TRI reporting pharmaceutical facilities managed
                    about 382 million pounds of production related wastes (total quantity of TRI
                    chemicals in the waste from routine production operations in Column B) in
                     1995.  From the yearly  data presented in Column B, the total quantity of
                    production related wastes increased between 1994 and 1995.  This is probably
                    in part because the number of chemicals on the TRI list almost doubled
                    between those years. The quantity of wastes generated was  also projected to
                    increase in 1996 and 1997. The effect of production increases on the amount
                    of wastes generated has not been evaluated.

                    Values in Column C are intended to reveal the percentage of TRI chemicals
                    that are either transferred off-site or released to the environment. Column C
                    is calculated by dividing the total TRI transfers and releases (reported in
                     Sections  5 and 6 of the TRI Form R) by the total quantity of production-
                    related waste (reported in Section 8 of Form R). Column C shows a decrease
                    in the portion either transferred off-site or released to the environment from
                     50 percent in  1994 to  46  percent in 1995.  The  waste released to the
                     environment or transferred off-site for disposal decreased slightly in 1995 to
                     about 10 percent of total wastes generated, as shown in Column J.  This
                     decreasing trend is projected to continue through 1997.
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Pharmaceutical Industry
                 Industrial Process Description
                      The overall proportions of wastes managed off-site (Columns D, E, and F)
                      and onsite (Columns G, H, and I) change very little from year to year. About
                      50 percent of the industry's TRI wastes  were managed on-site through
                      recycling, energy recovery, or treatment as shown in columns D, E, and F,
                      respectively.  Almost all  of these on-site managed wastes were recycled or
                      treated on-site. Only about two percent were used in energy recovery.  Waste
                      that is transferred off-site can be divided into portions that are recycled off-
                      site, recovered for energy  off-site, or treated off-site as shown in columns G,
                      H, and I, respectively.  The  remaining portion of the production related
                      wastes, 10 percent, shown in column J, is either released to the environment
                      through direct discharges to air, land, water,  and underground injection, or it
                      is disposed  off-site.
Table 13: Source Reduction and Recycling Activity for the
Pharmaceuticals Industry as Reported within TRI
A
Year
1994
1995
1996
1997
B
Quantity of
Production-
Related
Waste
(lO'lbs.)"
324
382
404
414
C
% Released
and
Transferred1"
50%
46%
NA
NA
On-Site
D
%
Recycled
13.9%
16.8%
18.7%
20.4%
E
% Energy
Recovery
2.0%
1.6%
1.6%
1.6%
F
% Treated
33.5%
34.3%
37.1%
35.9%
Off-Site
G
%
Recycled
5.3%
4.7%
5.1%
5.5%
H
% Energy
Recovery
21.7%
21.6%
18.8%
18.4%
I
% Treated
13.3%
11.7%
10.4%
9.9%
J
%
Released
and
Disposed"
Off-site

10.8%
9.7%
8.4%
8.3%
Source: Toxics Release Inventory Database, 1995.
3 Within this industry sector, non-production related waste < 1% of production related wastes for 1995.
 Total TRI transfers and releases as reported in Section 5 and 6 of Form R as a percentage of production related wastes.
c Percentage of production related waste released to the environment and transferred off-site for disposal.
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Pharmaceutical Industry
                Releases and Transfers Profile
IV. CHEMICAL RELEASE AND TRANSFER PROFILE
                    This section is designed to provide background information on the pollutant
                    releases that are reported by this industry. The best source of comparative
                    pollutant release information is the Toxic Release Inventory (TRI). Pursuant
                    to the Emergency Planning and Community Right-to-Know Act, TRI includes
                    self-reported facility release and transfer data for over 600 toxic chemicals.
                    Facilities within SIC Codes 20 through 39 (manufacturing industries) that
                    have more than 10 employees, and that are above weight-based reporting
                    thresholds are required to report TRI on-site releases and off-site transfers.
                    The information presented  within the sector notebooks is derived from the
                    most recently available (1995) TRI reporting year (which includes over 600
                    chemicals),  and focuses primarily on the on-site releases reported by each
                    sector.  Because TRI requires consistent reporting regardless of sector, it is
                    an excellent tool for drawing comparisons across industries. TRI data provide
                    the type, amount and media receptor of each chemical released or transferred.

                    Although this sector  notebook does  not  present historical information
                    regarding TRI chemical releases over time, please note that in general, toxic
                    chemical releases have been declining.  In fact, according to the 1995 Toxic
                    Release Inventory Public Data Release,  reported onsite releases of toxic
                    chemicals to the environment decreased by 5 percent (85.4 million pounds)
                    between 1994 and 1995 (not including chemicals added and removed from the
                    TRI chemical list during this period).  Reported releases dropped by 46
                    percent between 1988 and 1995. Reported transfers of TRI chemicals to off-
                    site locations increased by 0.4 percent (11.6 million pounds) between 1994
                    and 1995.  More detailed information  can be obtained from EPA's annual
                    Toxics Release Inventory  Public  Data Release book (which is available
                    through the EPCRA Hotline at 800-535-0202), or directly from the Toxic
                    Release Inventory System database (for user support call 202-260-1531).

                    Wherever possible, the sector notebooks present  TRI data as the primary
                    indicator of chemical release  within each industrial  category.  TRI data
                    provide the type, amount and media receptor of each chemical released or
                    transferred.  When other sources of pollutant release data have been obtained,
                    these data have been included to augment the TRI  information.
TRI Data Limitations
                     Certain limitations exist regarding TRI data.  Release and transfer reporting
                     are limited to the approximately 600 chemicals on the TRI list.  Therefore, a
                     large portion of the emissions from industrial facilities are not captured by
                     TRI. Within some  sectors, (e.g. dry cleaning, printing and transportation
                     equipment cleaning) the majority of facilities are not subject to TRI reporting
                     because they are not considered manufacturing industries, or because they are
                     below TRI reporting thresholds. For these sectors, release information from
 Sector Notebook Project
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Pharmaceutical Industry
                Releases and Transfers Profile
                     other sources has been included. In addition, many facilities report more than
                     one SIC code reflecting the multiple operations carried out onsite. Therefore,
                     reported releases  and transfers may or may not all be associated with the
                     industrial operations described in this notebook.

                     The reader should also be aware that TRI "pounds released" data presented
                     within the notebooks is not equivalent to a "risk" ranking for each industry.
                     Weighting each pound of release  equally does not factor in the relative
                     toxicity of each chemical that is released.  The Agency is in the process of
                     developing an approach  to assign  toxicological weights to each chemical
                     released so  that one can differentiate between pollutants  with  significant
                     differences in toxicity. As a preliminary indicator of the environmental impact
                     of the industry's most commonly released chemicals, the notebook briefly
                     summarizes the toxicological properties of the top five chemicals (by weight)
                     reported by each industry.

Definitions Associated with Section IV Data Tables

       General Definitions

                     SIC Code — the Standard Industrial Classification (SIC) is a statistical
                     classification standard used for all establishment-based Federal economic
                     statistics. The SIC  codes facilitate comparisons between facility and industry
                     data.

                     TRI Facilities — are manufacturing facilities that have  10 or more full-time
                     employees and are  above established  chemical  throughput thresholds.
                     Manufacturing  facilities  are  defined as  facilities  in  Standard  Industrial
                     Classification primary codes 20-39. Facilities must submit estimates for all
                     chemicals that are on the TRI  list and are above throughput thresholds.

       Data Table Column Heading Definitions

                     The following definitions are based upon standard  definitions developed by
                     EPA's Toxic Release Inventory Program. The categories below represent the
                     possible pollutant  destinations that can be reported.

                     RELEASES ~  are an on-site discharge of a toxic chemical  to  the
                     environment. This includes emissions to the air,  discharges to bodies of
                     water,  releases at the facility to land,  as  well as contained disposal into
                     underground injection wells.

                     Releases to Air  (Point  and  Fugitive Air Emissions) — Include all  air
                     emissions from industry activity. Point emissions occur through confined air
                     streams as found in stacks, vents, ducts, or pipes.  Fugitive emissions include
Sector Notebook Project
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Pharmaceutical Industry
                Releases and Transfers Profile
                     equipment leaks, evaporative losses from surface impoundments and spills,
                     and releases from building ventilation systems.

                     Releases to Water (Surface Water Discharges) — encompass any releases
                     going directly to streams, rivers, lakes, oceans, or other bodies of water.
                     Releases due to runoff, including storm water runoff, are also reportable to
                     TRI.

                     Releases to Land ~ occur within the boundaries of the reporting facility.
                     Releases to  land include  disposal of toxic chemicals in landfills, land
                     treatment/application farming, surface impoundments, and other land disposal
                     methods (such as spills, leaks, or waste piles).

                     Underground Injection — is a contained release of a fluid into a subsurface
                     well for the purpose of waste disposal. Wastes containing TRI chemicals are
                     injected into either Class I wells or Class V wells.  Class I wells are used to
                     inject liquid  hazardous wastes  or dispose  of industrial  and municipal
                     wastewaters beneath the lowermost underground source of drinking water.
                     Class V wells are generally used to inject non-hazardous fluid into or above
                     an underground source of drinking water. TRI reporting does not currently
                     distinguish between these two types of wells, although there are important
                     differences in environmental impact between these two methods of injection.

                     TRANSFERS— is a transfer of toxic chemicals in wastes to  a facility that is
                     geographically  or physically separate from the facility reporting under TRI.
                     Chemicals reported to TRI as transferred are sent to off-site facilities for the
                     purpose of recycling, energy recovery, treatment, or disposal. The quantities
                     reported represent a  movement  of the chemical away from the reporting
                     facility. Except for off-site transfers for disposal, the reported quantities do
                     not necessarily represent entry of the chemical into the environment.

                     Transfers to POTWs — are wastewater transferred through pipes or sewers
                     to a publicly owned treatments works (POTW).  Treatment or removal of a
                     chemical from the wastewater depend on the nature of the chemical, as well
                     as the treatment methods present at the POTW.  Not all TRI chemicals can
                     be treated or removed by a POTW.  Some chemicals, such as metals, may be
                     removed, but are not destroyed and may be disposed of in landfills or
                     discharged to receiving waters.

                     Transfers to Recycling -- are sent off-site for the purposes of regenerating
                     or recovery by  a variety of recycling methods, including solvent recovery,
                     metals recovery, and acid regeneration.  Once these chemicals have been
                     recycled, they may be returned to the originating facility or sold commercially.
Sector Notebook Project
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Pharmaceutical Industry
                Releases and Transfers Profile
                    Transfers to Energy Recovery — are wastes combusted off-site in industrial
                    furnaces for energy recovery. Treatment of a chemical by incineration is not
                    considered to be energy recovery.

                    Transfers to Treatment — are wastes moved off-site to be treated through
                    a  variety of  methods, including  neutralization,  incineration, biological
                    destruction, or physical separation. In some cases, the chemicals are not
                    destroyed but prepared for further waste management.

                    Transfers to Disposal — are wastes taken to another facility for disposal
                    generally as a release to land or as an injection underground.
Sector Notebook Project
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Pharmaceutical Industry
                Releases and Transfers Profile
IV.A. EPA Toxic Release Inventory for the Pharmaceutical Industry

                     This section summarizes TRI data of pharmaceutical facilities reporting SIC
                     codes 2833 and 2834 as the primary SIC code for the facility.  Of the 916
                     pharmaceutical  establishments  reported   by  the  7992  Census  of
                     Manufacturers, 200 reported to TRI in 1995.

                     According to  1995 TRI data, the reporting facilities released (discharged to
                     the air, water,  or land without treatment) and transferred (shipped off-site) a
                     total of 177 million pounds of pollutants, made up of 104 different chemicals.
                     This represents about 3 percent of the 5.7 billion pounds of TRI chemicals
                     released and transferred by all manufacturers that year. In comparison, the
                     chemical industry (SIC 28) as a whole produced 1.7 billion pounds that year,
                     accounting for about 30 percent of all releases and transfers.

                     Of the pharmaceutical industry's  TRI releases. 57 percent go to the air, 25
                     percent to underground injection, 17 percent to surface waters, and 1 percent
                     to the land. This release profile differs from  other TRI industries which
                     average approximately 59 percent to air, 30 percent to water, and 10 percent
                     to land. Table 14 lists the pharmaceutical industry's TRI reported chemical
                     releases.

                     Of the pharmaceutical industry's transfers, about 55 percent are transferred
                     for energy recovery off-site, 19 percent for treatment off-site, 13 percent are
                     transferred to POTWs, 12 percent for recycling off-site, and about 1 percent
                     for disposal off-site. Table 15 lists the pharmaceutical industry's TRI reported
                     toxic chemical transfers.

                     Of the top ten most frequently reported toxic chemicals on the TRI list, the
                     prevalence of volatile chemicals explains the air intensive  toxic chemical
                     loading of the pharmaceutical industry.  Seven of the ten most commonly
                     reported toxic chemicals are highly volatile.  Six of the ten are volatile organic
                     compounds (methanol, dichloromethane, toluene,  ethylene glycol, N,N-
                     Dimethylformamide, and acetonitrile). These are primarily solvents used to
                     extract active ingredients and for cleaning equipment.  The primary means of
                     release to the environment are from fugitive air and point air sources. Large
                     quantities of methanol, N,N-Dimethylformatnide, and acetonitrile, however,
                     are released via underground injection.  Other commonly reported chemicals
                     released and transferred are acids (hydrochloric, sulfuric,  and phosphoric)
                     which can be used for pH control or as catalysts.
Sector Notebook Project
57
September 1997

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Pharmaceutical Industry
                                                                Releases and Transfers Profile
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                                              58
                                                                                 September 1997

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                              60
                                                September 1997

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Pharmaceutical Industry
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                                                                       September 1997

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Pharmaceutical Industry
                Releases and Transfers Profile




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63
September 1997

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                                      64
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 Sector Notebook Project
65
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Pharmaceutical Industry
                Releases and Transfers Profile
                     The TRI database contains a detailed compilation of self-reported, facility-
                     specific chemical releases. The top reporting facilities for the pharmaceutical
                     industry are listed below in Tables 16.  Facilities that have reported only the
                     SIC codes covered under this notebook as a primary SIC code appear on the
                     first list.  Table 17  contains additional facilities that have reported the SIC
                     code covered within this report, and one or more SIC codes that are not
                     within the scope of this notebook.  Therefore, the second list includes facilities
                     that conduct multiple operations ~ some that are under the scope  of this
                     notebook,  and some that are not. Currently,  the facility-level data do not
                     allow pollutant releases to be broken apart by industrial process.
Table 16: Top 10 TRI Releasing Pharmaceutical Manufacturing Facilities8
Rank
1
2
3
4
5
6
7
8
9
10
Facility
Pharmacia & Upjohn Co., Portage, Michigan
Warner-Lambert Co., Holland, Michigan
Eli Lilly & Co. - Tippecanoe Labs, Shadeland, Indiana
Upjohn Mfg., Co., Barceloneta, Puerto Rico
Pfizer Inc., Groton, Connecticut.
Eli Lilly & Co - Clinton Laboratories, Clinton, Indiana
Abbott Chemicals, Inc., Barceloneta, Puerto Rico
Pfizer Inc., Southport, North Carolina
Schering-Plough Products, Inc., Las Piedras, Puerto Rico
Biokyowa Inc., Cape Girardeau, Missouri
Total TRI Releases in
Pounds
8,307,190
2,594,111
2,504,810
2,001,450
1,761,385
1,282,605
1,193,707
1,164,350
756,089
669,869
Source: US EPA 1995 Toxics Release Inventory Database.
* Being included on this list does not mean that the release is associated with non-compliance with environmental laws.
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Pharmaceutical Industry
                 Releases and Transfers Profile
Table 17: Top 10 TRI Releasing Facilities Reporting Pharmaceutical Manufacturing SIC
Codes to TRP
Rank
1
2
3
4
5
6
7
8
9
10
SIC Codes
Reported in TRI
2834
2819,2834,2842,
2865, 2869, 2873,
2879
2834
2834
2834
2833
2834, 2869, 2969
2833, 2834
2819,2821,2824,
2834, 2865, 2869,
2879, 2979
2833, 2834
Facility
Pharmacia & Upjohn Co., Portage, Michigan
Monsanto Co., Luling, Louisiana
Warner-Lambert Co., Holland, Michigan
Eli Lilly & Co. - Tippecanoe Labs, Shadeland,
Indiana
Upjohn Mfg., Co., Barceloneta, Puerto Rico
Pfizer Inc., Groton, Connecticut.
Ethyl Corp., Orangeburg, South Carolina
Eli Lilly & Co - Clinton Laboratories, Clinton,
Indiana
Dow Chemical Co., Midland, Michigan
Abbott Chemicals, Inc., Barceloneta, Puerto Rico
Total TRI Releases in
Pounds
8,307,190
5,698,031
2,594,111
2,504,810
2,001,450
1,761,385
1,284,456
1,282,605
1,228,629
1,193,707
Source: US EPA Toxics Release Inventory Database, 1995.
  Being included on this list does not mean that the release is associated with non-compliance with environmental laws.
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Pharmaceutical Industry
                 Releases and Transfers Profile
IV.B. Summary of Selected Chemicals Released
                     The following is a synopsis of current scientific toxicity and fate information
                     for the top chemicals (by weight) that facilities within both SIC 2833 and
                     2834 self-reported as released to the environment based upon 1994 TRI data.
                     Because this section is based upon self-reported release data, it does not
                     attempt to provide information on management practices employed by the
                     sector  to  reduce the release  of these  chemicals.   Information regarding
                     pollutant release reductions over time may be available from EPA's TRI and
                     33/50 programs, or directly from the industrial trade  associations that are
                     listed in Section Vm of this document. Since these descriptions are cursory,
                     please consult the sources referenced below for a more detailed description
                     of both the chemicals described in this section, and the chemicals that appear
                     on the full list of TRI chemicals appearing in Section IV. A.

                     The  brief descriptions provided below were taken from the Hazardous
                     Substances Data Bank (HSDB) and the Integrated Risk Information System
                     (IRIS). The discussions of toxicity describe the range of possible adverse
                     health effects that have been found to be associated with exposure to these
                     chemicals.   These adverse effects may or may not occur at the levels released
                     to the environment. Individuals interested in a more detailed picture of the
                     chemical concentrations associated with these adverse effects should consult
                     a toxicologist or the toxicity literature for the chemical to obtain more
                     information.   The effects listed below  must be taken in context of these
                     exposure assumptions that are more fully explained within the full chemical
                     profiles in HSDB.  For more  information on TOXNET" ,  contact the
                     TOXNET help line at 1-800-231-3766.
       Methanol (CAS: 67-56-1)
                      Toxicity.  Methanol is readily absorbed by the gastrointestinal tract and the
                      respiratory tract, and is toxic to humans in moderate to high doses.  In the
                      body, methanol is converted into formaldehyde and formic acid.  Methanol is
                      excreted as formic acid.  Observed toxic effects at high dose levels generally
                      include central nervous system damage and blindness.  Long-term exposure
* TOXNET is a computer system run by the National Library of Medicine that includes a number of toxicological
databases managed by EPA, National Cancer Institute, and the National Institute for Occupational Safety and Health.
For more information on TOXNET, contact the TOXNET help line at 800-231 -3766. Databases included in TOXNET
arc: CCRIS (Chemical Carcinpgenesis Research Information System), DART (Developmental and Reproductive
Toxicity Database), DBBR. (Directory of Biotechnology Information Resources), EMICBACK (Environmental Mutagen
Information Center Backfile), GENE-TOX (Genetic Toxicology), HSDB (Hazardous Substances Data Bank), IRIS
(Integrated Risk Information System), RTECS (Registry of Toxic Effects of Chemical Substances), and TRI (Toxic
Chemical Release Inventory). HSDB contains chemical-specific information on manufacturing and use, chemical and
physical properties, safety and handling, toxicity and biomedical effects, pharmacology, environmental fate and exposure
potential, exposure standards and regulations, monitoring and analysis methods, and additional references.
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Pharmaceutical Industry
                Releases and Transfers Profile
                     to high levels of methanol via inhalation cause liver and blood damage in
                     animals.

                     Ecologically, methanol is expected to have low toxicity to aquatic organisms.
                     Concentrations lethal to half the organisms of a test population are expected
                     to exceed one mg methanol per liter water. Methanol is not likely to persist
                     in water or to bioaccumulate in aquatic organisms.

                     Carcinogenicity. There is currently no evidence to suggest that methanol is
                     carcinogenic.

                     Environmental Fate.  Liquid methanol is likely to evaporate when left
                     exposed. Methanol reacts in air to produce formaldehyde which contributes
                     to the formation of air pollutants. In the atmosphere it can react with other
                     atmospheric chemicals  or be washed out by rain.  Methanol is readily
                     degraded by microorganisms in soils and surface waters.

                     Physical Properties.   Methanol is a colorless,  highly flammable liquid.
                     Methanol is miscible in water and has a boiling point of 147 degrees F.
       Methylene Chloride (Dichloromethane) (CAS: 75-09-2)

                     Toxicity. Short-term exposure to methylene chloride (MC) is associated with
                     central nervous  system effects,  including headaches, giddiness,  stupor,
                     irritability, and numbness, and tingling in the limbs.  More severe neurological
                     effects are reported from longer-term exposure, apparently due to increased
                     carbon monoxide in the blood from the break down of MC.  Contact with MC
                     causes irritation of the eyes, skin, and respiratory tract.

                     Occupational exposure to MC has also been linked to increased incidence of
                     spontaneous abortions in women. Acute damages to the eyes and upper
                     respiratory  tract,  unconsciousness, and  death were reported in workers
                     exposed to high concentrations of MC. Phosgene (a degradation product of
                     MC) poisoning has been reported to occur in several cases where MC was
                     used in the presence of an open fire.

                     Populations at special risk from exposure to MC  include obese people (due
                     to accumulation of MC in fat), and people with impaired cardiovascular
                     systems.

                     Carcinogenity. MC is a probable human carcinogen via both inhalation and
                     oral exposure, based on limited evidence in humans, and sufficient evidence
                     in animals.
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Pharmaceutical Industry
                Releases and Transfers Profile
                     Environmental Fate. When spilled on land, MC is rapidly lost from the soil
                     surface through volatilization.  The remainder leaches through the subsoil into
                     the groundwater.

                     Biodegradation is possible in natural waters but will probably be very slow
                     compared with evaporation. Little is known about bioconcentration in aquatic
                     organisms or adsorption to sediments but these are not likely to be significant
                     processes.    Hydrolysis  is  not  an important    process under normal
                     environmental conditions.

                     MC released into the atmosphere degrades via contact with other gases with
                     a half-life of several months. A small fraction of the chemical diffuses to the
                     stratosphere where it rapidly degrades  through  exposure to ultraviolet
                     radiation and contact with chlorine ions.  Being a  moderately soluble
                     chemical, MC is expected to partially return to earth in rain.

                     Physical Properties. Methylene chloride is a colorless liquid.  It is soluble to
                     2 percent in water and has a boiling point of 104 degrees F.
       Ammonia0 (CAS:.7664-4J-7)

                     Toxicity. Anhydrous ammonia is irritating to the skin, eyes, nose, throat, and
                     upper respiratory system.

                     Ecologically, ammonia is a source of nitrogen (an essential element for aquatic
                     plant growth), and may therefore contribute to eutrophication of standing or
                     slow-moving surface water, particularly in nitrogen-limited waters such as the
                     Chesapeake Bay. In addition, aqueous ammonia is moderately toxic to aquatic
                     organisms.

                     Carcinogenicity. There is currently no evidence to suggest that ammonia is
                     carcinogenic.

                     Environmental Fate.    Ammonia  combines  with  sulfate  ions  in the
                     atmosphere and is washed out by rainfall, resulting in rapid return of ammonia
                     to the soil and surface waters.

                     Ammonia is a central compound in the environmental cycling of nitrogen.
                     Ammonia in lakes, rivers, and streams is converted to nitrate.
a The reporting standards for ammonia were changed in 1995. Ammonium sulfate is deleted from the list and threshold
and release determinations for aqueous ammonia are limited to 10 percent of the total ammonia present in solution. This
change will reduce the amount of ammonia reported to TRI. Complete details of the revisions can be found in 40 CFR
Part 372.
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Pharmaceutical Industry
                 Releases and Transfers Profile
                     Physical Properties.  Ammonia is a colorless gas at atmospheric pressure,
                     but is shipped as a liquefied compressed gas. It is soluble to about 34 percent
                     in water and has a boiling point of-28 degrees F. Ammonia It is corrosive and
                     has a pungent odor.
       Toluene (CAS: 108-88-3)

                     Toxicity. Inhalation or ingestion of toluene can cause headaches, confusion,
                     weakness, and memory loss. Toluene may also affect the way the kidneys and
                     liver function.

                     Reactions of toluene (see environmental fate) in the atmosphere contribute to
                     the  formation of ozone in the lower atmosphere.  Ozone can affect the
                     respiratory system, especially in sensitive individuals such as asthma or allergy
                     sufferers.

                     Some studies have shown that unborn animals were harmed when high levels
                     of toluene were inhaled by their mothers, although the same effects were not
                     seen when the mothers were fed large quantities of toluene. Note that these
                     results may reflect similar difficulties in humans.

                     Carcinogenicity. There is currently no evidence to suggest that toluene is
                     carcinogenic.

                     Environmental Fate. A portion of releases of toluene to land and water will
                     evaporate.  Toluene may also be  degraded  by microorganisms.   Once
                     volatilized, toluene in the lower atmosphere will react with other atmospheric
                     components contributing to the formation of ground-level ozone and other air
                     pollutants.

                     Physical Properties.  Toluene liquid with a sweet, pungent odor. It is soluble
                    to 0.07 percent in water and has a boiling point of 232 degrees F.
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Pharmaceutical Industry
               Releases and Transfers Profile
IV.C. Other Data Sources
                    The toxic chemical release data obtained from TRI captures many of the
                    facilities in the pharmaceutical industry.  It also allows for a comparison
                    across years and industry sectors. Reported chemicals are limited however to
                    the  approximately  600 reported  chemicals.   Most of the hydrocarbon
                    emissions from pharmaceutical facilities are not captured by TRI.  The EPA
                    Office of Air Quality Planning and Standards has compiled air pollutant
                    emission factors for determining the total air emissions of priority pollutants
                    (e.g., total hydrocarbons,  SO2, NQ, CO, particulates, etc.) from many
                    chemical manufacturing sources.

                    The EPA Office of Air's Aerometric Information Retrieval System (AIRS)
                    contains a wide range of information related to stationary  sources of air
                    pollution, including the emissions of a number of air pollutants which may be
                    of concern within a particular industry. With the exception of volatile organic
                    compounds (VOCs), there is little overlap with the TRI chemicals reported
                    above.   Table 18 summarizes annual  releases of carbon monoxide (CO),
                    nitrogen dioxide (NO^, particulate matter of 10 microns or less (PM10), total
                    particulate (PT),  sulfur dioxide (SO2),  and  volatile organic compounds
                    (VOCs).
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Pharmaceutical Industry
               Releases and Transfers Profile
Table 18: Air Pollutant Releases by Industry Sector (tons/year)
Industry Sector
Metal Mining
Nonmetal Mining
Lumber and Wood
Production
Furniture and Fixtures
Pulp and Paper
Printing
Inorganic Chemicals
Organic Chemicals
Petroleum Refining
Rubber and Misc. Plastics
Stone, Clay and Concrete
Iron and Steel
Nonferrous Metals
Fabricated Metals
Electronics and Computers
Motor Vehicles, Bodies,
Parts and Accessories
Dry Cleaning
Ground Transportation
Metal Casting
Pharmaceuticals
Plastic Resins and
Manmade Fibers
Textiles
Power Generation
Shipbuilding and Repair
CO
4,670
25,922
122,061
2,754
566,883
8,755
153,294
112,410
734,630
2,200
105,059
1,386,461
214,243
4,925
356
15,109
102
128,625
116,538
6,586
16,388
8,177
366,208
105
NO2
39,849
22,881
38,042
1,872
358,675
3,542
106,522
187,400
355,852
9,955
340,639
153,607
31,136
11,104
1,501
27,355
184
550,551
11,911
19,088
41,771
34,523
5,986,757
862
PM10
63,541
40,199
20,456
2,502
35,030
405
6,703
14,596
27,497
2,618
192,962
83,938
10,403
1,019
224
1,048
3
2,569
10,995
1,576
2,218
2,028
140,760
638
PT
173,566
128,661
64,650
4,827
111,210
1,198
34,664
' 16,053
36,141
5,182
662,233
87,939
24,654
2,790
385
3,699
27
5,489
20,973
4,425
7,546
9,479
464,542
943
S02
17,690
18,000
9,401
1,538
493,313
1,684
194,153
176,115
619,775
21,720
308,534
232,347
253,538
3,169
741
20,378
155
8,417
6,513
21,311
67,546
43,050
13,827,511
3,051
voc
915
4,002
55,983
67,604
127,809
103,018
65,427
180,350
313,982
132,945
34,337
83,882
11,058
86,472
4,866
96,338
7,441
104,824
19,031
37,214
74,138
27,768
57,384
3,967
Source: U.S. EPA Office of Air and Radiation, AIRS Database, 1997.
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Pharmaceutical Industry
                Releases and Transfers Profile
IV.D. Comparison of Toxic Release Inventory Among Selected Industries

                     The following information is presented as a comparison of pollutant release
                     and transfer data across industrial categories.  It is provided to give a general
                     sense as to the relative scale of releases and transfers within each sector
                     profiled under this project. Please note that the following figure and table do
                     not contain releases and transfers  for industrial categories that  are  not
                     included in this project, and thus  cannot  be used to draw conclusions
                     regarding the total release and transfer amounts that are reported to TRI.
                     Similar information is available within the annual TRI Public Data Release
                     Book.

                     Figure 12 is a graphical representation of a summary of the 1995 TRI data for
                     the pharmaceutical industry  and the other sectors profiled in separate
                     notebooks.  The bar graph presents the total TRI releases and total transfers
                     on the vertical axis. The graph is based on the data in Table 19 and is meant
                     to facilitate comparisons among the relative amounts of releases, transfers,
                     and releases per facility both within and among these sectors.  The reader
                     should note, however, that differences in the proportion of facilities captured
                     by TRI  exist among industry sectors.  This can be a factor of poor  SIC
                     matching and relative differences in the number of facilities reporting to TRI
                     from the various sectors.  In the case of the pharmaceutical industry, the 1995
                     TRI  data presented here covers 200 facilities. Only those facilities listing
                     primary SIC codes falling within SIC 2833 and 2834 were used.

                     Comparisons of the reported pounds released or transferred per facility in
                     Table 19 demonstrate that the pharmaceutical industry is above average in its
                     pollutant releases and transfers per facility when compared  to  other TRI
                     industries. Of the twenty manufacturing SIC codes listed in the TRI database,
                     the mean amount of pollutant release per facility (including pharmaceutical
                     facilities) was approximately 101,000 pounds.   The TRI releases of the
                     average pharmaceutical facility (SIC 2833 and 2834) were 150,000 pounds,
                     making  the industry  1.5 times higher in per facility releases than for other
                     industries. For transfers, the mean of pharmaceutical facilities was about 4.6
                     times as much as that of all TRI manufacturing facilities (161,000 pounds
                     transferred  off-site  per facility   compared  to  736,000  pounds  per
                     pharmaceutical facility).  This comparison is difficult to interpret due to the
                     divergent nature of the industries listed in Table 19 and the differences in the
                     raw  materials and processes used to manufacture the specific industry's
                     products.  The batch nature and large volumes  of raw materials used to
                     produce the relatively small amounts of high purity pharmaceutical products
                     may account for the higher rate released and transferred by the pharmaceutical
                     industry.
Sector Notebook Project
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Pharmaceutical Industry
               Releases and Transfers Profile
       Figure 12: Summary of TRI Releases and Transfers by Industry
       600
                                CM
                                CO
                                CM
                                       SIC Range
                      D Total Releases
             I Total Transfers
Source: US EPA 1995 Toxics Release Inventory Database.
SIC
Range
22
24
25
2611-2631
2711-2789
2812-2819
2821,
2823, 2824
Industry Sector
Textiles
Lumber and Wood
Products
Furniture and Fixtures
Pulp and Paper
Printing
Inorganic Chemical
Manufacturing
Plastic Resins and
Manmade Fibers
SIC
Range
2833,
2834
2861-
2869
2911
30
32
•331
332, 336
Industry Sector
Pharmaceuticals
Organic Chem. Mfg.
Petroleum Refining
Rubber and Misc. Plastics
Stone, Clay, and Concrete
Iron and Steel
Metal Casting
SIC
Range
333,334
34
36
371
3731 ,
Industry Sector
Nonferrous Metals
Fabricated Metals
Electronic Equip, and
Comp.
Motor Vehicles, Bodies,
Parts, and Accessories •
Shipbuilding

Sector Notebook Project
75
September 1997

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Pharmaceutical Industry
Releases and Transfers Profile





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Sector Notebook Project
              September 1997

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Pharmaceutical Industry
            Pollution Prevention Opportunities
V. POLLUTION PREVENTION OPPORTUNITIES
                     The best way to reduce pollution is to prevent it in the first place.  Some
                     companies have creatively implemented pollution prevention techniques that
                     improve efficiency and increase profits while at the same time minimizing
                     environmental impacts.  This can be done in many ways, such as reducing
                     material inputs, re-engineering processes to reuse by-products, improving
                     management practices, and employing substitution of toxic chemicals.  Some
                     smaller facilities are able to actually get below regulatory thresholds just by
                     reducing pollutant releases through  aggressive pollution prevention policies.

                     The Pollution Prevention Act  of 1990  established  a national policy of
                     managing waste through source reduction, which means preventing the
                     generation of waste.  The Pollution Prevention Act also established as national
                     policy a hierarchy of waste management options for situations in which source
                     reduction  cannot be implemented feasibly.   In the waste  management
                     hierarchy, if source reduction is not feasible the next alternative is recycling
                     of wastes, followed by energy recovery,  and waste treatment as  a last
                     alternative.

                     In order to encourage these approaches, this section provides both general
                     and company-specific descriptions of pollution prevention activities that have
                     been implemented within the pharmaceutical industry. While the list is not
                     exhaustive, it does provide core information that can be used as the starting
                     point  for facilities interested in beginning their own pollution prevention
                     projects. When possible, this section provides information from real activities
                     that can be, or are being, implemented by this sector - including a discussion
                     of associated costs, time frames, and expected rates of return.  This section
                     provides  summary information from activities that may be,  or are being
                     implemented by this sector.  Please note that the activities described in this
                     section do not necessarily apply to all facilities that fall  within this sector.
                     Facility-specific conditions  must be  carefully  considered when pollution
                     prevention options are evaluated, and the full impacts of the change must be
                     examined to determine how each option affects air, land and water pollutant
                     releases.

                     The bulk manufacturing processes  of the pharmaceutical  industry are
                     characterized by a low ratio of finished product to raw material. Therefore,
                     large quantities of residual waste are generated, especially in fermentation and
                     natural product extraction.   Chemical synthesis processes generate wastes
                     containing hazardous spent solvents and reactants, combined with residual
                     wastes such as reaction residues. Equipment cleaning water and residue, often
                     containing hazardous chemicals, also are a major waste stream (U.S. EPA,
                     1991).
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Pharmaceutical Industry
           Pollution Prevention Opportunities
                    Source reduction is one method by which the industry aims to reduce these
                    wastes. However, source reduction methods such as process modifications
                    and material  substitutions  may  not be  as  easily implemented in the
                    pharmaceutical industry as in other manufacturing sectors. This is because
                    any significant change to the production process of an existing product, may
                    need approval from the Food and Drug Administration (FDA). If a company
                    wishes to change the method of making a drug or active ingredient that goes
                    into it, the FDA requires the company to prove that the 'new' drug is of the
                    same or better quality as the old drug and that any reformulation will not
                    adversely affect the identity, strength, quality, purity, or bioavailability of the
                    drug.  The process of gathering information to support the change and
                    awaiting  FDA review and approval can be lengthy, time-consuming and
                    expensive.

                    As a result, many pharmaceutical companies are looking at ways to minimize
                    waste in future production processes at the research and development stage.
                    Incorporating pollution prevention at the start of a new drug development
                    process is much more economical, efficient, and environmentally sound (see
                    Section VI. D. for further details). The factors affecting the pharmaceutical
                    industry's pollution prevention efforts were documented by PhRMA members
                    in a 1997 document entitled Pharmaceutical Industry Waste Minimization
                    Initiatives.

                    Many pharmaceutical companies  have already  implemented pollution
                    prevention programs in their manufacturing facilities.  Although pollution
                    prevention may not always be a substitute for control technologies, it is often
                    viable and is  an increasingly popular method for meeting environmental
                    compliance requirements. Some examples  of innovative waste reduction
                    programs that incorporate source reduction as well as recycling and reuse are
                    presented in the case studies that appear in this section.
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Pharmaceutical Industry
            Pollution Prevention Opportunities
       V.A. Material Substitutions
                     Substituting raw materials to lessen the volume and/or toxicity of waste
                     generated is a type of source reduction (U.S. EPA, 1991). One of the most
                     common  opportunities for material substitutions in the Pharmaceuticals
                     industry is found in the tablet coating process. Until recently, many tablet
                     coating operations  involved  the  use of methylene  chloride  and other
                     chlorinated solvents. By switching to aqueous-based coating films, many
                     firms have reduced the hazardous waste content in their air and effluent waste
                     streams, as well as the cost of purchasing chemicals.  Aqueous-based cleaning
                     solutions are also being used more frequently for equipment cleaning instead
                     of solvent-based solutions (U.S. EPA, 1991).
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Pharmaceutical Industry
           Pollution Prevention Opportunities
                    POLLUTION PREVENTION CASE STUDIES

  Material Substitution

  •      Schering-Plough Pharmaceuticals will market a new inhaler for the treatment of
         asthma, which is free of chlorofluorocarbons (CFCs). The CFC-free inhaler was
         developed by 3M Pharmaceuticals.  CFCs are used as a propellant in metered-dose
         inhalers (MDI).  In a new MDI, which was approved by the FDA in August, 1996,
         CFCs have been replaced by hydrofluoroalkane-134a (HFA-134a). Unlike CFCs,
         HFA-134a does not deplete the ozone. The product will be marketed under the
         brand name Proventil® HFA.

  •      Schering-Plough Laboratories is switching to a coated natural kraft (CNK)
         paperboard for its packaging.  CNK is stronger and less expensive than the
         previous packaging material, as well as recyclable and compostable.  The
         paperboard is not bleached with chlorine, but is coated with white clay coating.
         Instead of mineral-based varnishes and inks, water and soy-based materials are
         used. In New Jersey alone, the company is expected to save $225,000 per year
         and could save up to $1.2 million if the program expands to other divisions.

  •      At its West Point, PA, facility,  Merck removed 1,1,1 -Trichloroethane (TCA) from
         its production bperations.  TCA was used in stripping labels off bottles and other
         cleaning operations, printing, and manufacturing.  A citrus-based solvent was
         substituted for cleaning packaging equipment. For cleaning manufacturing
         equipment, a petroleum-based  solvent was substituted, the waste from which is
         used for energy recovery in an  off-site facility.

  •      At the same facility, Merck substituted phenol for thimerosal, a mercury-based
         compound. Thimerosal had been used as a biocide to inactivate bacteria during the
         initial stages of fermentation in the production of a vaccine.  Substituting phenol, a
         less-hazardous, FDA-approved biocide enabled Merck to achieve an 85 percent
         reduction in mercury-based waste.  In addition, the substitution resulted in
         increased product yields, improved microbial kinetics, and cost savings for raw
         materials.

   •      At its Cherokee plant in Riverside, PA, Merck developed an innovative new
         manufacturing chemistry which substitutes toluene for dichloromethane.  The
         change has resulted in a 98 percent reduction in releases and transfers of
         dichloromethane.  In addition, because toluene is less volatile  and more easily
         recovered, the controls and recovery equipment on the new process are able to
         control toluene releases such that they have increased only slightly.
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           Pollution Prevention Opportunities
  Material Substitution (cont)

  •      Riker Laboratories in Northbridge, CA recently replaced several different organic
         solvent coating materials used on medicine tablets with a water-based coating
         material. Differences in the new coating material required that new spray
         equipment be installed. However, the company saves $15,000 per year not
         purchasing these organic solvents and determined that $180,000 in pollution
         control equipment was no longer needed. They estimate that the investment will
         pay for itself in less than one year. The substitution prevents 24 tons per year in
         organic solvent emissions, reduced exposure risks to workers, and has made it
         easier for the company to comply with strict California air emission standards.

  •      In producing the anti-viral drug 6-aminopenicillanic acid, Bristol-Myers Squibb
         used to extract the intermediate, penicillin V from an aqueous fermentation broth.
         The broth was filtered and the intermediate then was extracted in several centrifuge
         steps using the toxic solvent methyl isobutyl ketone (MiBK). The extraction was a
         major source of fugitive emissions.  The broth now is filtered through a membrane
         and the intermediate is extracted using n-butyl acetate, a non-toxic chemical, in
         closed centrifuges, reducing fugitive emissions.  The overall capital investment for
         this project came to almost $10 million.  However, the annual operating cost
         reductions, coupled with a 10 percent increase in throughput, generate $4.9 million
         in additional cash flow.  Based  on this, the project will generate a return on
         investment of 28 percent and a payback period of 2.7 years. In addition the project
         reduced hazardous waste by 20,000 pounds and eliminated over one million pounds
         of MiBK releases to the air and water.

  •      Glaxo-Wellcome, Inc. developed an innovative aqueous coating method that
         eliminated the use of methylene chloride, isopropyl alcohol, methanol, and ethanol
         in their Zantac tablet coating operations performed at their Zebulon, North Carolina
         facility. Glaxo-Wellcome overcame a number of obstacles before using the
         aqueous-based coating material on the Zantac production line. First, the
         pharmaceutical active readily degraded at the extreme heat and moisture
         encountered during aqueous coating.  Also, the pharmaceutical active migrates
         through the aqueous coating causing discolorization and degradation of the tablet
         coating film.  To implement the use of the substitute materials, Glaxo-Wellcome
         had to make extensive changes to the coater spray assemblies, revamped the coater
         air handling system with larger  fans and heating coils, and installed a dehumidifying
         system. The capital investment  for this equipment was $1.5 million. However, the
         company annually saves $286,800 in organic solvent purchases and $322,900 in
         disposal costs of the more than 479 tons of hazardous waste generated by the old
         system every year. The estimated payback period for the modifications is three
         years.  In addition, the new system cut VOC emissions to the air from almost
         15,000 pounds per year to zero.

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Pharmaceutical Industry
           Pollution Prevention Opportunities
   Material Substitution (cont)

   •      The Pharmacia and Upjohn, Inc. Sterile Manufacturing area in Kalamazoo has
         received FDA approval for a Thimerosal-free formulation of one of its products.
         This new formulation will eliminate the use of Thimerosal, a mercury based
         preservative, in the manufacture of the drug Atgam. Atgam will be manufactured
         without any preservative using new closed column chromatography and Restrictive
         Access Barrier technology. Atgam is used to prevent organ transplant rejection
         and in the treatment of aplastic anemia.

   •      The Eli Lilly Cleaning Technology Center in late 1996 initiated a formal screening
         program to identify potential aqueous based cleaners as replacements for the
         various organic and chlorinated solvents currently used in bulk pharmaceutical
         manufacturing equipment cleanings. In one product line, 8,700 liters of acetone per
         cleaning was replaced with an alkaline aqueous based cleaner for an estimated
         annual reduction of 17,400 liters of acetone. An acid aqueous based cleaner
         replaced methanol in another product line, resulting in methanol reductions of
         25,800 liters per year. In cleaning operations associated with another product,  an
         alkaline aqueous based cleaner replaced 117,000 liters of methanol and 600 liters of
         ethylene dichloride per cleaning.  This resulted in an estimated annual reduction of
         368,000 liters of methanol and 1,200 liters of ethylene dichloride.
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 Pharmaceutical Industry
            Pollution Prevention Opportunities
 V.B. Process Modifications
                     Process modifications are alterations to or modernization of existing processes
                     to reduce waste generation. Process modifications can involve re-designing
                     chemical transfer systems to reduce spillage and other material losses.  For
                     example, in batch operations, each loading and unloading of the reactors and
                     other equipment increases the risk of chemical  spills and  solvent vapor
                     releases.  Batch operations often require more frequent reactor clean outs
                     using significant volumes of cleaning solution and solvents. With continuous
                     operations, the reactor is loaded once and solvents and reactants are fed into
                     the reactor continually, thereby reducing the risk  of pollutant releases (US
                     EPA, 1991).

                     Thus switching from batch to continuous operations for certain products may
                     potentially reduce large volumes of wastes.  Switching to a  continuous or
                     partially continuous process may be possible  for a facility that is the primary
                     producer of a product which is in constant demand. For example, Hoffmann
                     La Roche's facility in Nutley, NJ is one of the primary producers of Vitamin
                     E in the country. Consequently, much of their vitamin production equipment
                     is dedicated and run as semi-continuous operations.

                     Process changes that optimize reactions and raw material use can reduce
                     waste and releases  to the environment (US EPA,  1995).  Modifications as
                     simple as careful monitoring of reaction parameters (temperatures, pH, etc.)
                     can dramatically improve manufacturing efficiency. Production in many of the
                     large  pharmaceutical companies  is computerized and highly  automated.
                     Computers equipped with computer aided design (CAD) programs visually
                     simulate the production process on the screen.  The automated  system allows
                     production managers to  turn on the batch process and  control  temperatures,
                     pressure, and other process parameters, from the keyboard.  While, the system
                     runs,  production personnel are free to do other things such  as  check
                     equipment or take product samples. Such careful automated monitoring may
                     insure against the formation of fouling waste at the bottom of reactor vessels,
                     thereby reducing the need for additional cleaning, as well as lessening the risk
                     of damaged batches of product which have to be disposed (US EPA, 1991).
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harmaceutical Industry
          Pollution Prevention Qpportunitie
                   POLLUTION PREVENTION CASE STUDIES

 Process Modifications

 •      As part of their "Environment 2000" program, Bristol-Myers Squibb has started to
        look at Product Life Cycle (PLC) management as a way to implement pollution
        prevention. PLC involves investigating the environmental impacts of a product at
        every stage of production: R&D, manufacturing, and packaging. Pollution
        prevention options are now being investigated at the very beginning of drug
        development. This eliminates the possibility of lengthy Supplementary Drug
        Approval applications with FDA. Using PLC management, Bristol-Myers Squibb
        discovered the use of a filtration membrane for their 6-aminopenicillanic acid
        production (see Section V.A. Case Studies).

 •      At its East Hanover, NJ facility, Sandoz Pharmaceutical Co. changed processes in
        its reactors, to reduce solvent usage.  An inert atmosphere above the reaction
        mixture is used during synthesis to  protect the reaction from exposure to oxygen.
        In the previous process, nitrogen flowed continuously over the mixture, carrying
        away with it a certain amount of solvent vapors. The nitrogen gas blanketing
        process uses a non-flowing nitrogen layer that only bleeds out a very small amount
        of nitrogen and solvent.

  •      In their main drug development lab in Tippecanoe, IN, Eli Lilly and Company has
        implemented a pollution prevention program. Beginning in the R&D phase, the
        company assesses the environmental impacts of every new product and determines
        where wastes can be minimized. As a result, Eli Lilly developed a new process
        which eliminated the use of methylene chloride, aluminum wastes, use of an
        odoriferous raw material, and all distillation steps from production of a drug under
        development for the treatment of osteoporosis.

  •      One of Hoffmann La Roche's major manufacturing processes uses glycol ether as
        an extractive solvent, much of which had  to be disposed of as wastewater. After
        the product is recovered, the glycol ether is distilled and reused. The overhead.
        from the distillation is primarily water with some glycol ether which is disposed as
        wastewater. The process was redesigned to increase per pass recycle of the glycol
         ether in the distillation column by 12%. As a result, use of the chemical was
         reduced by about 60% and solvent releases decreased by 300,000 pounds per year
         and the batch cycle time was reduced by four hours.  Annual savings are $250,000.
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            Pollution Prevention Opportunities
  Process Modifications (cont)

  •       At one of its facilities, Hoffman La Roche was using 110,000 gallons of methanol per
         year for cleaning equipment during product changeovers.  Methanol was being used
         for all cleaning and rinsing stages. To reduce methanol usage and the associated
         waste disposal costs, a new method was developed whereby a two-stage water-based
         cleaning is done before a final methanol rinse.  This reduced the amount of methanol
         used to about 30,000 gallons per year and saves about $49,000 per year.

  •       In one of its manufacturing processes, Hoffman La Roche extracted a synthesized
         pharmaceutical intermediate from toluene into water,  and then from water into
         chloroform. Because toluene was soluble in the extraction, it contaminated the
         chloroform and created a waste stream of the mixed solvents. The company eliminated
         the waste stream by steam-distilling the toluene from the water so that the toluene
         never came in contact with the chloroform. Chloroform use decreased by 76 percent
         which was sufficient to remove this material from the  list of chemicals the facility was
         required to include in its Toxic Release Inventory report. The project saved $22,000
         per year.

  •       At its West Point, PA facility, Merck Co. made a simple change in the sequence of
         process steps used to manufacture a vaccine, which resulted in a substantial reduction
         of mercury-based wastes.  Thimerisol, a mercury-based chemical, was used as a
         preservative during an intermediate process step. Thus any waste stream produced
         during the rest of the process was contaminated with mercury. A process change was
         initiated to add thimerosal  at the end of the process. By climating mercury in waste
         streams generated prior to  the addition of thimerisol, mercury contaminated wastes
         generated during manufacturing were dramatically reduced.

  •       At its Flint River plant in Albany, Georgia, Merck used steam jets to produce a
         vacuum in the process vessel  during the production of an antibiotic.  This  results in
         dichloromethane being mixed with steam  and subsequently evaporating into the air.
         The steam jets were replaced with liquid ring vacuum  pumps which reduced air
         emissions. Dichloromethane emissions were further reduced by maintaining the
        vacuum pump seal fluid at  subzero temperatures which condenses the
        dichloromethane vapor so it can be recycled and reused.

  •      Pharmacia and Upjohn's wastewater treatment process was modified to significantly
        reduce waste disposed by its Underground Injection Control operation.  A
        modification suggested by an employee eliminated about 1 million pounds of solid
        waste. This modification involved substituting a bag filter for a precoat vacuum filter.
        The precoat vacuum filter used a diatomaceous filter medium, which generated large
        volumes of solid waste. The bag filter creates much less waste per volume of liquid
        filtered. The used filter bags are incinerated on site, thereby greatly reducing landfill
        wastes.
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Pharmaceutical Industry
          Pollution Prevention Opportunities
 Process Modifications (cont)

 •      In converting to a new process for bioconversion of a steroid intermediate, Pharmacia
        and Upjohn, Inc. has eliminated approximately 90,000 pounds of dimethylformamide
        waste and approximately 190,000 pounds of filter aid waste per year. In addition,
        solvent handling was reduced from about 6 million pounds to about 600,000 pounds
        and aqueous waste was reduced more than 4 million pounds per year.
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Pharmaceutical Industry
            Pollution Prevention Opportunities
V.C. Good Operating Practices
                     One of the easiest and most economical ways to achieve source reduction is
                     to implement good operating practices.  Pharmaceutical companies already
                     follow a list of Good Manufacturing Practices (GMP) guidelines outlined by
                     the FDA.  In some cases these involve good operating practices that will
                     reduce raw materials use and waste generation.  As a result, many companies
                     have developed environmental policies for all of their facilities, both in the
                     U.S.  and abroad. Typically, policies may be written for employee training,
                     employee health and safety, hazardous chemical spill cleanup procedures,
                     equipment maintenance procedures, leak detection, and emergency response
                     procedures.

                     Management  commitment.  Good operating practices start with on-site
                     commitment and understanding of the need  and methods for pollution
                     prevention, from top management levels to the plant floor.  Without facility-
                     wide efforts to reduce pollution, source reduction may not be successful (US
                     EPA, 1991).

                     Employee training.  An employee training program is essential to the success
                     of a source reduction program. Employees should be trained in safe handling
                     of equipment, chemicals, and wastes.  They should also be informed of any
                     potentially harmful health effects of the hazardous chemicals they handle. As
                     well as being trained in proper operation of equipment and chemical handling,
                     employees should be trained in spill  cleanup  and methods for detecting
                     chemical releases (US EPA, 1991).

                     Maintenance  programs.   Maintenance programs  should  target both
                     preventive and corrective maintenance of equipment.    This means that
                     equipment should be regularly checked and cleaned to insure its proper
                     functioning, and damaged equipment should be repaired quickly.  Routine
                     cleaning, minor adjustments, testing and replacement of parts, should be a part
                     of the maintenance program. Additionally, good record keeping of equipment
                     checks, repairs, cleaning, and equipment failure  will help to reduce the
                     likelihood of future equipment breakdowns and any associated pollution
                     releases (US EPA, 1991).

                     Inventory control. The wide range of chemicals used in the pharmaceutical
                     industry makes it essential to instigate an efficient inventory tracking system,
                     such  as a "first-in, first-out" policy and chemicals must be properly labeled
                     with their name, date of purchase, and date of expiration. This helps to insure
                     that older, un-used chemicals do not have to be needlessly discarded (US
                     EPA, 1991). In addition, having one person responsible for the distribution of
                     chemicals and supplies insures a more efficient tracking system (US EPA,
                     1995). Inventory tracking is a valuable and easy method for  reducing wastes.
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           Pollution Prevention Opportunities
                     Spill prevention and  storage.  Spill and leak prevention are  critical to
                     pollution prevention. Tightly secured storage tanks are a key to avoiding
                     spills.  Containers should have good valves with tight stopping devices to
                     avoid the spilling or dripping of hazardous chemicals. Storage containers
                     should have legible signs indicating the contents of the container, health
                     hazard warnings (where necessary), and spill cleanup procedures in case of
                     emergencies. Large drums can be raised above the ground to avoid corrosion.
                     An organized storage area facilitates fast and easy removal of chemicals, as
                     well as reduction and cleanup of spills (U.S. EPA, 1991).
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Pharmaceutical Industry
           Pollution Prevention Opportunities
                     POLLUTION PREVENTION CASE STUDIES

   Good Operating Practices

   •      At its Kenilworth, NJ facility, Schering-Plough Pharmaceuticals has a central
         warehouse with a computerized inventory system. Raw materials come into the
         warehouse in large volumes. Materials are weighed according to batch
         requirements,  labeled, and then sent to different process areas throughout the
         facility. This eliminates excess  raw material wastes and ensures that only the
         amounts needed are used.

   •      Sandoz Pharmaceuticals has also developed a system to improve scheduling of
         batch operations in their facilities worldwide and domestically. Accurate
         scheduling reduces the chances of excess wastes and costs, which occur when a
         batch changeover takes place.

   •      At its Nutley, NJ plant, Hoffmann La Roche was able to identify and repair more
         than 900 sources of fugitive emissions. In addition, the company installed ultra-low
         temperature condensers to remove solvents from vent streams.  The captured
         solvents are recycled or treated off-site.

   •      The Pharmacia and Upjohn, Inc. Puerto Rico Technical Operations group was the
         first offshore location to implement the company's pollution prevention program.
         The local pollution prevention team helps the plant set pollution prevention goals.
         The team reports progress toward meeting goals annually.  As a result, the Butyl
         Alcohol recovery efficiency at the facility has been increased to 95% and Acetone
         to 96%. The facility has been tracking waste indices (Tons of waste generated vs.
         Kilograms of product produced) and results for several wastes show reductions
         over a four-year period.  The pollution prevention program has been fully
         implemented at all Pharmacia and Upjohn U.S. sites. Under the program individual
         business units set goals and report on progress annually. More than 300 pollution
         prevention projects, many of them in the research and development areas, have
         been recorded since the program started in 1990.

   •      The Chemical and Fermentation operation at Pharmacia and Upjohn, Inc. in
         Kalamazoo has begun using interlocked valve systems on jacketed coolers. The
         new valve systems help prevent the inadvertent discharge of methanol, used as
         refrigerant, to surface waters.  They also  have begun using new drip-less pipe
         couplers to reduce solvent losses and spills from hose connections.
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Pharmaceutical Industry
           Pollution Prevention Opportunities
V.D. Recycling, Recovery, and Reuse
                     "Recovery and recycling include direct reuse of waste material, recovering
                     used materials for a separate use, and removing impurities from waste to
                     obtain relatively pure  substances" (EPA 1991).  Although  "strict quality
                     control requirements of the pharmaceutical industry often  restrict reuse
                     opportunities, some do exist" (EPA 1991) and are considered valuable by the
                     industry since they reduce the volume of raw materials used and the amount
                     of waste generated and disposed.

                     Except for in-process recycling, EPA does not consider recycling, recovery,
                     and reuse to be source reduction techniques.  However, in-process recycling,
                     which includes the reuse or recirculation of a chemical within a process and
                     may  include recovery or  reclamation,  is considered a  source reduction
                     technique. The pharmaceutical industry often uses this form of recycling
                     which is  dedicated to and physically integrated with the pharmaceutical
                     manufacturing process by means of piping or another form of conveyance.

                     Recycling and  recovery  provides the pharmaceutical  industry a great
                     opportunity to  reduce the volume  and  toxicity of  spent  solvents.   As
                     described in Section 3, solvents are used for a wide range of applications,
                     from synthesis, extraction,  and purification of active ingredients to cleaning
                     process equipment. The  types  of solvent recovery employed  include
                     distillation, evaporation, decantation, centrifugation, and filtration. However,
                     limitations exist with both on and off-site recycling and recovery since several
                     types of solvents (including water), reactants, and other contaminants may be
                     present. These materials must be extracted to allow the solvent to be reused"
                     either in a pharmaceutical process or in another process. Additionally, special
                     techniques and equipment must be used to break azeotropes formed during
                     the chemical reactions.

                     In addition to solvents, some residual wastes may also be recovered and
                     reused.  For example,  filter cakes from fermentation processes are usually
                     disposed of in landfills.  An alternative being used in some facilities is to
                     collect the waste filter cakes, recover any valuable by-products, and then sell
                     the cakes to be used as fertilizers or soil additives. To be used as a fertilizer,
                     the nitrogen, phosphorus, and potassium content must be greater than 5%,
                     which sometimes can be achieved by reducing the moisture  content in the
                     filter cake (US EPA, 1991).
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Pharmaceutical Industry
            Pollution Prevention Opportunities
                     POLLUTION PREVENTION CASE STUDIES

   Recycling, Recovery, and Reuse

   •      Nycomed Inc. manufactures bulk pharmaceutical products by batch processing. In
          processing a product for medical diagnostic imaging, the company installed closed
          loop distillation units to recover all of its methanol washes and methanol-containing
          wastewater. The methanol recovery system can distill approximately 2,000 gallons
          per day of 70 percent methanol to more than 99.5 percent methanol, which can be
          reused in the same process. Nycomed Inc. eliminated water discharges of
          methanol, reduced hazardous waste, and saved approximately 680,000 pounds of
          methanol in the first half of 1992, saving $54,438 in the same period.

   •      The Pharmacia and Upjohn, Inc. Chemical and Fermentation operation in
          Kalamazoo reuses more than 195 million pounds of solvent annually.
          Approximately 80% of the site's total solvent requirement and 90% of the site's
          chlorinated solvent requirement is met by reused solvent. The reused solvent
          demand is met through a combination of in process solvent reuse (150 million
          pounds)  and distillation (45 million pounds).  There are now six centralized
          distillation units.  On site solvent reuse and recovery in chemical processes helped
          the company exceed its 33/50 Program goals. The achievement was
          commemorated by a National Performance Review Environmental Champion
          Award given to the company by Vice President Al Gore in 1995.

   •      Pharmacia and Upjohn, Inc. Chemical Process Research and Development
          developed a proprietary distillation process for splitting Tetrahydrofiiran from a
          mixture of alcohol, water, and other wastes.  Without the new process,
          Tetrahydrofliran forms azeotropic mixtures with alcohol which cannot be distilled.
          This process now recovers approximately 1 million pounds of THF per year.

   •      Pharmacia and Upjohn, Inc. is evaluating the possibilities of reusing waste solvent
          condensate produced from their cryogenic air pollution control equipment. They
          have identified one methylene chloride rich stream to recover as a trial. An
          estimated 2.5 million pounds of this waste solvent is generated annually. Recovery
          by an off-site recycler or on site reclamation are being further  evaluated.
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Pharmaceutical Industry
          Pollution Prevention Opportunities
V.E. Pollution Prevention Research
                     Because of comprehensive regulations from both the FDA and the EPA,
                     pharmaceutical companies are continuously researching new and innovative
                     ways to reduce their wastes.  Many companies are starting to look at pollution
                     prevention options  early  in  development and  are collaborating  with
                     universities and other research institutions to develop new technologies that
                     will help reduce or eliminate wastes.  Some of these technologies, still in the
                     research and testing stages, are discussed below.
       Solvent Minimization
                     One potential research area which has been identified is in supercritical
                     solvents.  Supercritical fluids are known to be very effective solvents and can
                     function as an alternative to traditional chlorinated and other toxic solvents
                     used in pharmaceutical separations.  These solvents are in a supercritical state,
                     meaning  that  they are at a very high temperature and/or pressure.   A
                     relatively small change in the temperature and/or pressure in supercritical state
                     can lead to large changes in the solubility of chemicals in the solvent.  This
                     increase in solubility is ideal for separations because the overall volume of
                     solvent needed is reduced (NJIT, 1991).
       Separation Improvements
                     Separation of active ingredients from solvents is one of the most important
                     processes in the pharmaceutical industry. Research has been conducted to
                     find separation methods which generate fewer by-products and less waste.

                     One technology with such a potential is inorganic membrane reactors.  "They
                     are in effect reactors with built-in separators which may have potential for
                     reaction sequences with  much  better  reactor  utilization and  product
                     concentrations"  (NJIT,  1991).  Inorganic membranes enable a  continuous
                     removal of product and a controlled addition of reactant.  This increases the
                     potential for higher yields and greater selectivity by chemicals, which could
                     reduce the volume of solvents required, thereby reducing costs and wastes.
                     Also, because the reaction and separation are combined in a single step, the
                     emissions associated with the traditional transfer step between reaction and
                     separation are eliminated (NJIT, 1991).
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 Pharmaceutical Industry
              Federal Statutes and Regulations
 VI. SUMMARY OF APPLICABLE FEDERAL STATUTES AND REGULATIONS

                     This section discusses the Federal regulations that may apply to this sector.
                     The purpose of this section is to highlight and briefly describe the applicable
                     Federal requirements, and to provide citations for more detailed information.
                     The three following sections are included:

                     Section VI. A contains a general overview of major statutes
                     Section VLB contains a list of regulations specific to this industry
                     Section VI. C contains a list of pending and proposed regulations
                     Section VI.D contains a general overview of other federal statutes applicable
                     to the industry
                     Section VIE. contains a general overview of state regulations affecting the
                     industry.

                     The  descriptions  within  Section  VI  are   intended solely for general
                     information.  Depending upon the nature or scope of the  activities  at a
                     particular facility, these summaries may or may not necessarily describe all
                     applicable environmental requirements.  Moreover, they do not constitute
                     formal interpretations or clarifications of the statutes and regulations.  For
                     further information readers should consult the Code of Federal Regulations
                     and state or local regulatory agencies.  EPA Hotline  contacts  are  also
                     provided  for each major statute.

VI.A. General Description of Major Statutes

       Resource Conservation And Recovery Act (RCRA)

                     RCRA of 1976, which amended the Solid Waste Disposal Act, addresses solid
                     (Subtitle  D) and hazardous (Subtitle C)  waste management activities.  The
                     Hazardous and Solid Waste Amendments (HSWA) of 1984 strengthened
                     RCRA's waste management provisions and added Subtitle I, which governs
                     underground storage tanks (USTs).

                     Regulations promulgated pursuant to Subtitle C of RCRA (40 CFR Parts
                     26.0-299)  establish a "cradle-to-grave" system governing hazardous waste
                     from the point of generation to disposal. RCRA hazardous wastes include the
                     specific materials listed in the regulations (commercial chemical products,
                     designated with  the  code  "P" or  "U"; hazardous wastes from  specific
                     industries/sources, designated with the code "K"; or hazardous wastes from
                     non-specific sources, designated with the code "F") or materials which exhibit
                     a hazardous waste characteristic (ignitability, corrosivity, reactivity, or toxicity
                     and designated with the code "D").

                    Regulated entities  that generate hazardous  waste  are  subject to waste
                    accumulation, manifesting, and record keeping  standards.  Facilities must
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                    obtain a permit either from EPA or from a State agency which EPA has
                    authorized to  implement the permitting program if they store hazardous
                    wastes for more than 90 days before treatment or disposal.  Facilities may
                    treat hazardous waste stored in  less-than-ninety-day tanks or containers
                    without a permit.  Subtitle C permits contain general facility standards such
                    as contingency plans, emergency procedures, record keeping and reporting
                    requirements, financial assurance  mechanisms, and unit-specific standards.
                    RCRA also contains provisions (40 CFR Part 264 Subpart S and §264.10) for
                    conducting corrective actions  which govern the  cleanup of releases of
                    hazardous waste  or constituents from solid waste management units at
                    RCRA-regulated facilities.

                    Although RCRA is a Federal statute, many States implement the RCRA
                    program.  Currently, EPA has delegated its authority to implement various
                    provisions of RCRA to 47 of the 50 States and to  two U.S. territories.
                    Delegation has not been given to Alaska, Hawaii, or Iowa.

                    Most RCRA requirements are not industry specific but apply to any company
                    that generates, transports, treats, stores, or disposes of hazardous waste.
                    Here are some important RCRA regulatory requirements:

                           Identification of Solid and Hazardous Wastes (40 CFR Part 261)
                           lays out the procedure every generator should follow to  determine
                           whether the material in question created is considered a hazardous
                           waste,  solid waste, or is exempted from regulation.

                           Standards for Generators of Hazardous Waste (40 CFR Part 262)
                           establishes the responsibilities of hazardous waste generators including
                           obtaining an EPA ID number, preparing a manifest, ensuring proper
                           packaging and labeling, meeting standards for waste accumulation
                           units, and record keeping and reporting requirements. Generators can
                           accumulate hazardous waste for up to 90 days (or 180 days depending
                           on the amount of waste generated) without obtaining a permit.

                           Land  Disposal Restrictions  (LDRs)  (40  CFR Part 268)  are
                           regulations  prohibiting the disposal of hazardous waste  on  land
                           without prior treatment.  Under the LDRs program, materials must
                           meet LDR treatment standards prior to placement in a RCRA land
                            disposal unit (landfill,  land treatment unit, waste pile, or surface
                            impoundment). Generators of waste subject to the LDRs must provide
                            notification of such to the designated TSD facility to ensure proper
                           treatment prior to disposal.

                            Used  Oil Management Standards (40 CFR  Part 279) impose
                            management requirements affecting the  storage,  transportation,
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                           burning, processing, and re-refining of the used oil. For parties that
                           merely generate used oil, regulations establish storage standards. For
                           a party considered a used oil processor, re-refiner, burner, or marketer
                           (one who generates and sells off-specification used oil), additional
                           tracking and paperwork requirements must be satisfied.

                           RCRA contains unit-specific standards for all units used to  store,
                           treat, or dispose  of  hazardous waste, including Tanks  and
                           Containers.  Tanks and containers used to store hazardous  waste
                           with a  high  volatile organic concentration  must meet emission
                           standards under RCRA. Regulations (40 CFR Part 264-265, Subpart
                           CC) require  generators to  test the  waste  to determine  the
                           concentration of the waste, to satisfy tank and container emissions
                           standards,  and to  inspect and  monitor regulated units.  These
                           regulations apply to all facilities that store such waste, including large
                           quantity generators accumulating waste prior to shipment off-site.

                           Underground Storage Tanks (USTs) containing petroleum and
                           hazardous  substances are regulated under  Subtitle  I  of RCRA.
                           Subtitle I regulations (40 CFR Part 280) contain tank design and
                           release detection requirements, as well as financial responsibility and
                           corrective action standards for USTs.   The UST program also
                           includes upgrade requirements for existing tanks that must be met by
                           December 22,  1998.                                          .

                           Boilers  and  Industrial Furnaces (BIFs) that  use  or burn fuel
                           containing hazardous waste  must comply with  strict design and
                           operating standards.  BIF regulations (40 CFR Part 266, Subpart H)
                           address unit design, provide performance standards, require emissions
                           monitoring, and restrict the type of waste that may be burned.

                    EPA's RCRA/Superfund/UST Hotline, at (800) 424-9346, responds to
                    questions and distributes guidance regarding all RCRA regulations.  The
                    RCRA Hotline operates weekdays from 9:00 a.m. to 6:00 p.m., ET, excluding
                    Federal holidays.

       Comprehensive Environmental Response,  Compensation, And Liability Act (CERCLA)

                    CERCLA,  a 1980 law commonly known as Superfund, authorizes EPA to
                    respond to releases, or threatened releases,  of hazardous substances that may
                    endanger public health, welfare, or the environment. CERCLA also enables
                    EPA to force parties responsible for environmental contamination to clean it
                    up or to reimburse the Superfund for response costs incurred by EPA. The
                    Superfund  Amendments and Reauthorization Act (SARA) of 1986 revised
                    various sections of CERCLA, extended the taxing authority for Superfund,
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                                 and  created a free-standing law,  SARA  Title III, also  known as the
                                 Emergency Planning and Community Right-to-Know Act (EPCRA).

                                 The CERCLA hazardous substance release reporting regulations (40 CFR
                                 Part 302) direct the person in charge of a facility to report to the National
                                 Response Center (NRC) any environmental release of a hazardous substance
                                 which equals or exceeds  a reportable quantity.  Reportable quantities are
                                 defined and listed in 40 CFR §302.4.  A release report may trigger a response
                                 by EPA, or by one or more Federal or State emergency response authorities.

                                 EPA implements hazardous substance responses according to procedures
                                 outlined in the National Oil and Hazardous Substances Pollution Contingency
                                 Plan (NCP) (40 CFR Part 300).  The NCP includes provisions for permanent
                                 cleanups,  known as remedial  actions, and other cleanups referred to as
                                 "removals."  EPA generally takes remedial actions only at sites on the
                                 National Priorities List (NPL), which currently includes approximately 1300
                                 sites.  Both EPA and states can act at other sites; however, EPA provides
                                 responsible parties the opportunity to conduct removal and remedial actions
                                 and encourages community involvement throughout the Superfund response
                                 process.

                                 EPA's RCRA/Superfund and EPCRA Hotline, at (800) 424-9346,  answers
                                 questions and references guidance pertaining to the Superfund program.
                                 The CERCLA Hotline operates weekdays from 9:00 a.m. to 6:00 p.m., ET,
                                 excluding Federal holidays.

                    Emergency Planning And Community Right-To-Know Act (EPCRA)

                                 The Superfund Amendments  and  Reauthorization  Act (SARA)  of 1986
                                 created EPCRA, also known as SARA Title m, a statute designed to improve
                                 community access to information about chemical hazards and to facilitate the
                                 development of chemical emergency response plans by State and local
                                 governments.  EPCRA  required the establishment of State emergency
                                 response  commissions  (SERCs),  responsible for  coordinating  certain
                                 emergency response activities and for appointing local emergency  planning
                                 committees (LEPCs).

                                 EPCRA and the EPCRA regulations (40 CFR Parts 350-372) establish four
                                 types of reporting obligations for facilities which store or manage specified
                                 chemicals:

                                        EPCRA §302 requires facilities to notify the SERC and LEPC of the
                                        presence of any "extremely hazardous  substance" (the list of such
                                        substances is in 40 CFR  Part 355, Appendices A and B) if it has such
                                        substance in excess of the substance's threshold planning quantity, and
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                           directs the facility to appoint an emergency response coordinator.

                           EPCRA §304 requires the facility to notify the SERC and the LEPC
                           in the event of a release equaling or exceeding the reportable quantity
                           of a  CERCLA hazardous substance or  an EPCRA extremely
                           hazardous substance.

                           EPCRA §311 and §312 require a facility at which a hazardous
                           chemical, as defined by the Occupational Safety and Health Act, is
                           present in an amount exceeding a specified threshold to submit to the
                           SERC, LEPC and local fire department material safety data sheets
                           (MSDSs) or lists of MSDS's and hazardous chemical inventory forms
                           (also known as Tier I and II forms).  This information helps the local
                           government respond in the event of a spill or release of the chemical.

                           EPCRA §313 requires manufacturing facilities included in SIC codes
                           20 through  39,  which have ten or more employees,  and which
                           manufacture, process, or use specified chemicals in amounts greater
                           than threshold quantities, to submit an annual toxic chemical release
                           report. This report, commonly known as the Form R, covers releases
                           and transfers of toxic chemicals to various facilities and environmental
                           media, and allows EPA to  compile  the national Toxic Release
                           Inventory (TRI) database.

                    All information submitted pursuant  to EPCRA  regulations  is publicly
                    accessible, unless protected by a trade secret claim.

                    EPA'sRCRA, Superfund and EPCRA  Hotline, at (800) 424-9346, answers
                    questions and distributes guidance regarding the emergency planning and
                    community  right-to-know regulations.  The  EPCRA  Hotline  operates
                    weekdays from 9:00 a.m. to 6:00 p.m., ET, excluding Federal holidays.

       Clean Water Act (CWA)

                    The primary objective of the Federal Water Pollution Control Act, commonly
                    referred to as the CWA, is to restore and maintain the chemical, physical, and
                    biological integrity of the nation's surface waters. Pollutants regulated under
                    the CWA include  "priority"  pollutants  and various  toxic  pollutants;
                    "conventional" pollutants, such as biochemical oxygen demand (BOD), total
                    suspended solids (TSS), fecal coliform, oil and grease, and pH; and "non-
                    conventional" pollutants  which  are  pollutants  not identified  as  either
                    conventional or priority.

                    The CWA regulates both direct and indirect discharges.  The National
                    Pollutant Discharge Elimination System (NPDES) program (CWA §402)
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                     controls direct discharges into navigable waters. Direct discharges or "point
                     source" discharges are from sources such as pipes and sewers.  NPDES
                     permits, issued by either EPA or an authorized State (EPA has authorized 42
                     States to administer the  NPDES program),  contain industry-specific,
                     technology-based and/or water quality-based limits, and establish pollutant
                     monitoring requirements. A facility that intends to discharge into the nation's
                     waters  must obtain a permit  prior to initiating its discharge.   A permit
                     applicant must provide quantitative analytical data identifying the types of
                     pollutants present in the facility's effluent. The permit will then set forth the
                     conditions and effluent limitations under  which  a facility may make a
                     discharge.

                     A NPDES permit may also include discharge limits based on Federal or State
                     water quality criteria or standards that were designed to protect designated
                     uses of surface waters, such as supporting aquatic life or recreation.  These
                     standards, unlike the technological standards, generally do not take into
                     account technological feasibility or costs. Water quality criteria and standards
                     vary from state to state, and site to site, depending on the use classification
                     of the receiving body of water. Most states follow EPA guidelines, which
                     propose aquatic life and human health criteria for many of the  126 priority
                     pollutants.

                     Storm Water Discharges

                     In 1987 the CWA was amended to require EPA to establish a program to
                     address storm water discharges.  In response, EPA promulgated the NPDES
                     storm water permit application regulations. These regulations  require that
                     facilities with the following storm water discharges apply for an NPDES
                     permit:  (1) a discharge associated with industrial activity; (2) a discharge
                     from a large or medium municipal storm sewer system; or (3) a discharge
                     which EPA or the State determines to contribute to a violation of a water
                     quality  standard or is a significant contributor of pollutants to waters of the
                     United  States.

                     The term "storm water discharge associated with industrial activity" means a
                     storm water discharge from one of 11 categories of industrial activity defined
                     at 40 CFR 122.26. Six of the categories are defined by SIC codes while the
                     other five are identified through narrative descriptions of the regulated
                     industrial activity.  If the primary SIC code of the facility is one of those
                     identified in the regulations, the facility is subject to the storm water permit
                     application requirements. If any activity at a facility is covered by one of the
                     five narrative categories, storm water discharges from those areas where the
                     activities occur are subject to storm  water discharge permit application
                     requirements.
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                     Those facilities/activities that are subject to storm water discharge permit
                     application requirements are identified below.  To determine whether  a
                     particular facility falls within one of these categories, the regulation should be
                     consulted.

                            Category i:  Facilities subject to storm water effluent guidelines, new
                            source performance standards, or toxic pollutant effluent standards.

                            Category ii:   Facilities classified as SIC  24-lumber  and wood
                            products (except wood kitchen cabinets); SIC 26-paper and allied
                            products (except paperboard containers  and products);  SIC 28-
                            chemicals and allied products (except drugs and paints); SIC 291-
                            petroleum refining; and SIC 311-leather tanning and finishing, 32
                            (except 323)-stone, clay, glass, and concrete,  33-primary metals,
                            3441-fabricated structural metal, and 3 73-ship and boat building and
                            repairing.

                            Category iii:  Facilities classified as SIC 10-metal  mining; SIC 12-
                            coal mining; SIC 13-oil and gas extraction; and SIC 14-nonmetallic
                            mineral mining.
                            Category iv:
                            facilities.
Hazardous waste treatment, storage,  or disposal
                            Category v: Landfills, land application sites, and open dumps that
                            receive or have received industrial wastes.

                            Category vi:  Facilities classified as SIC 5015-used motor vehicle
                            parts; and SIC 5093-automotive scrap and waste material recycling
                            facilities.

                            Category vii:  Steam electric power generating facilities.

                            Category viii:  Facilities classified as SIC 40-railroad transportation;
                            SIC  41-local passenger transportation;  SIC  42-trucking  and
                            warehousing (except  public warehousing and storage); SIC 43-U.S.
                            Postal Service; SIC 44-water transportation; SIC 45-transportation by
                            air; and SIC 5171-petroleum bulk storage stations and terminals.

                            Category ix: Sewage treatment works.

                            Category x: Construction activities except operations that result in
                            the disturbance of less than five acres of total land area.
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                           Category  xi:  Facilities  classified as SIC  20-food and kindred
                           products; SIC 21-tobacco products; SIC 22-textile mill products; SIC
                           23-apparel related  products;  SIC 2434-wood  kitchen  cabinets
                           manufacturing; SIC 25-furniture and fixtures; SIC 265-paperboard
                           containers  and boxes; SIC 267-converted paper and paperboard
                           products; SIC 27-printing, publishing, and allied industries; SIC 283-
                           drugs;  SIC 285-paints,  varnishes, lacquer,  enamels,  and allied
                           products; SIC 30-rubber and plastics; SIC 31-leather and leather
                           products (except leather and tanning and finishing); SIC 3 23-glass
                           products;  SIC 34-fabricated metal products (except fabricated
                           structural metal); SIC 35-industrial and commercial machinery and
                           computer  equipment;  SIC  36-electronic  and  other  electrical
                           equipment and components; SIC 37-transportation equipment (except
                           ship and boat building and repairing); SIC 38-measuring, analyzing,
                           and controlling instruments; SIC 39-miscellaneous manufacturing
                           industries;  and SIC 4221-4225-public warehousing and storage.

                     Pretreatment Program

                     Another type of discharge that is regulated by the CWA is one that goes to a
                     publicly-owned treatment  works (POTWs). The national pretreatment
                     program (CWA §307(b))  controls the indirect discharge of pollutants to
                     POTWs by "industrial users." Facilities regulated under §307(b) must meet
                     certain pretreatment standards.  The goal of the pretreatment program is to
                     protect municipal wastewater treatment plants from damage that may occur
                     when hazardous, toxic, or other wastes are discharged into a sewer system
                     and to protect the quality of sludge generated by these plants. Discharges to
                     a POTW are regulated primarily by the POTW itself, rather than the State or
                     EPA.

                     EPA has  developed technology-based standards for industrial users of
                     POTWs. Different standards apply to existing and new sources within each
                     category.  "Categorical" pretreatment standards applicable to an industry on
                     a nationwide basis are developed by EPA.  In  addition,  another kind of
                     pretreatment standard, "local limits," are  developed by the POTW in order to
                     assist the POTW in achieving the effluent limitations in its NPDES permit.

                     Regardless of whether a State is authorized to implement either the NPDES
                     or the pretreatment program, if it develops its own program, it may enforce
                     requirements more stringent than Federal standards.

                     Spill Prevention. Control and Countermeasure Plans

                     The  1990 Oil Pollution Act requires that facilities that could reasonably be
                     expected to discharge oil in harmful quantities prepare and implement more
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                     rigorous Spill Prevention Control and Countermeasure (SPCC) Plan required
                     under the CWA (40 CFR §112.7). There are also criminal and civil penalties
                     for deliberate or negligent spills of oil. Regulations covering response to oil
                     discharges and contingency plans (40 CFR Part 300), and Facility Response
                     Plans to oil discharges (40 CFR §112.20) and for PCB transformers and PCB-
                     containing items were revised and finalized in 1995.

                     EPA's Office of Water, at (202) 260-5700, will direct callers with questions
                     about the CWA  to  the appropriate EPA  office.  EPA also maintains a
                     bibliographic database of Office of Water  publications -which can be
                     accessed through the  Ground Water and Drinking Water resource center, at
                     (202) 260-7786.

       Safe Drinking Water Act (SD WA)

                     The SDWA mandates that EPA establish regulations to protect human health
                     from contaminants in drinking water. The law authorizes EPA to develop
                     national  drinking water standards and to create a joint Federal-State system
                     to ensure compliance with these standards.  The SDWA also directs EPA to
                     protect  underground sources of  drinking water  through the  control of
                     underground injection of liquid wastes.

                     EPA has developed primary and secondary drinking water standards under its
                     SDWA authority.  EPA and authorized states enforce the primary drinking
                     water standards, which  are, contaminant-specific concentration limits that
                     apply to certain public  drinking water supplies.  Primary drinking water
                     standards consist of maximum contaminant level goals (MCLGs), which are
                     non-enforceable health-based  goals, and  maximum contaminant  levels
                     (MCLs), which are enforceable limits set as close to MCLGs as possible,
                     considering cost and  feasibility of attainment.

                     The SDWA Underground Injection Control (UIC) program (40 CFR Parts
                     144-148) is a permit program which protects underground sources of drinking
                     water by regulating  five classes of injection  wells.  UIC permits include
                     design, operating, inspection,  and monitoring requirements.   Wells used to
                     inject hazardous wastes must also comply with RCRA corrective action
                     standards in  order to have RCRA permit by rule status,  and must meet
                     applicable RCRA land disposal restrictions standards.  The UIC permit
                     program is primarily  state-enforced, since EPA has authorized all but a few
                     states to  administer the program.

                     The SDWA also provides for a Federally-implemented Sole Source Aquifer
                     program, which prohibits Federal funds from being expended on projects that
                     may contaminate the sole or principal source of drinking water for a given
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                    area, and for a State-implemented Wellhead Protection program, designed to
                    protect drinking water wells and drinking water recharge areas.

                    EPA's Safe Drinking Water Hotline, at (800) 426-4791, answers questions
                    and distributes guidance pertaining to SDWA standards.  The Hotline
                    operates from 9:00a.m. through 5:30 p.m., ET,  excluding Federal holidays.

       Toxic Stibstances Control Act (TSCA)

                    TSCA granted EPA authority to create a regulatory framework to collect data
                    on  chemicals in order to evaluate, assess, mitigate, and control risks which
                    may be posed  by their manufacture, processing, and use.  TSCA provides a
                    variety of control methods to prevent chemicals from  posing unreasonable
                    risk.

                    TSCA standards may apply at any point during a chemical's life cycle. Under
                    TSCA §5, EPA has established an inventory of chemical substances.  If a
                    chemical is not already on the inventory, and has not been excluded by TSCA,
                    a premanufacture notice (PMN)  must  be submitted to  EPA prior to
                    manufacture or import. The PMN must identify the chemical and provide
                    available information on health and environmental effects. If available data
                    are not sufficient to  evaluate the chemicals effects, EPA can  impose
                    restrictions  pending the development  of information on  its  health  and
                    environmental  effects. EPA can also restrict significant new uses of chemicals
                    based upon factors such as the projected volume and use of the chemical.

                    Under TSCA §6, EPA can ban the manufacture or distribution in commerce,
                    limit the use,  require labeling, or place  other restrictions on chemicals that
                    pose unreasonable risks.  Among the chemicals  EPA regulates under §6
                    authority are  asbestos, chlorofluorocarbons (CFCs),  and polychlorinated
                    biphenyls (PCBs).

                    EPA's TSCA Assistance Information Service, at (202) 554-1404, answers
                    questions and distributes guidance pertaining to Toxic Substances Control
                    Act standards.  The Service operates from 8:30 a.m. through 4:30 p.m., ET,
                    excluding Federal holidays.

       Clean Air Act (CAA)

                     The CAA and its amendments, including the Clean Air Act Amendments
                     (CAAA) of 1990, are designed to "protect and  enhance the nation's air
                     resources so as to promote the public health and welfare and the productive
                     capacity of the population."  The CAA consists of six sections, known as
                     Titles, which direct EPA to establish national standards for ambient air quality
                     and  for EPA and the States to implement,  maintain,  and enforce these
                     standards through a variety of mechanisms. Under the CAAA, many facilities
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                      will be  required to obtain permits for the first  time.   State and local
                      governments oversee, manage, and enforce many of the requirements of the
                      CAAA.  CAA regulations appear at 40 CFR Parts 50-99.
                      Pursuant to Title I of the CAA, EPA has established national ambient air
                      quality standards (NAAQSs) to limit levels of "criteria pollutants," including
                      carbon monoxide, lead, nitrogen dioxide, particulate matter, volatile organic
                      compounds (VOCs), ozone, and sulfur dioxide. Geographic areas that meet
                      NAAQSs for a given pollutant are classified as attainment areas; those that do
                      not meet NAAQSs are classified as non-attainment areas. Under § 110 of the
                      CAA, each State must develop a State Implementation Plan (SIP) to identify
                      sources of air pollution and to determine what reductions are required to meet
                      Federal air quality standards.  Revised NAAQSs for particulates and ozone
                      were proposed in 1996 and may go into effect as early as late 1997.

                      Title I also authorizes EPA to establish New Source Performance Standards
                      (NSPSs), which are nationally uniform emission standards for new stationary
                      sources falling within particular industrial categories. NSPSs are based on the
                      pollution control technology available to that category of industrial source.

                      Under Title I, EPA establishes and enforces National Emission Standards for
                      Hazardous Air Pollutants (NESHAPs), nationally uniform standards oriented
                      towards  controlling particular hazardous  air pollutants (HAPs).  Title I,
                      section 112(c) of the CAA further directed EPA to develop a list of sources
                      that emit any of 189 HAPs, and to  develop regulations for these categories of
                      sources. To date, EPA has listed 174 categories and developed a schedule for
                     the establishment of emission standards.  The emission standards will be
                     developed for both new and existing sources based on "maximum achievable
                     control technology (MACT)."   The MACT is defined  as  the  control
                     technology achieving the maximum degree of reduction in the emission of the
                     HAPs,  taking into account cost and other factors.

                     Title II of the CAA pertains to mobile sources, such as cars, trucks, buses,
                     and planes. Reformulated gasoline, automobile pollution control devices, and
                     vapor recovery nozzles on gas pumps are a few of the mechanisms EPA'uses
                     to regulate mobile air emission sources.

                     Title IV of the CAA establishes a sulfur dioxide emissions program designed
                     to reduce the formation of acid rain. Reduction of sulfur dioxide releases will
                     be  obtained by granting to certain sources limited  emissions allowances,
                     which, beginning in 1995, will be set below previous  levels of sulfur dioxide
                     releases.

                     Title V of the CAA of 1990 created a permit program for all "major sources"
                     (and certain other sources) regulated under the CAA.  One purpose of the
                     operating  permit  is to  include in a single document all air emissions
                     requirements that apply to a given facility. States are developing the permit
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                    programs in accordance with guidance and regulations from EPA.  Once a
                    State program is approved by EPA, permits will be issued and monitored by
                    that State.

                    Title VI of the CAA is intended to protect stratospheric ozone by phasing out
                    the manufacture of ozone-depleting chemicals and restrict their use and
                    distribution.  Production of Class I substances, including  15 lands of
                    chlorofluorocarbons (CFCs) and chloroform, were phased out (except for
                    essential uses) in 1996.

                    EPA's Clean Air Technology Center, at (919) 541-0800, provides general
                    assistance and information on CAA standards.  The Stratospheric Ozone
                    Information Hotline, at (800) 296-1996, provides general information about
                    regulations promulgated under Title VI of the  CAA, and EPA's EPCRA
                    Hotline, at (800) 535-0202, answers questions about accidental release
                    prevention under CAA §112(r).  In addition, the Clean Air Technology
                    Center's website includes recent CAA rules, EPA guidance documents, and
                    updates of EPA activities (www.epa.gov/ttn then select Directory and then
                    CATC).
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VLB. Industry Specific Requirements
                     The  pharmaceutical  industry  is  affected  by  several  major  federal
                     environmental statutes. In addition, the industry is subject to numerous laws
                     and regulations from state and local governments designed to protect and
                     improve the nation's health, safety, and environment.  A summary of the
                     major federal regulations affecting the pharmaceutical industry follows.
       Clean Air Act (CAA)
                    The original CAA authorized EPA to  set limits on pharmaceutical plant
                    emissions.  Some of these new source performance standards (NSPS) apply
                    to pharmaceutical manufacturers including those for flares (40 CFR Part 60
                    Subpart A), and storage of volatile organic liquids (40 CFR Part 60 Subpart
                    Kb).  The Clean Air Act Amendments of 1990 set control standards by
                    industrial sources for 41 pollutants to be met by 1995 and for 148 other
                    pollutants to be reached by 2003.  Under the air toxics provisions of the
                    CAAA, more sources are covered including small businesses. The Hazardous
                    Organic National Emissions Standard for Hazardous Air Pollutants, also
                    known as HON, covers hundreds of chemicals and thousands of process units.
                    The pharmaceutical industry is affected by standards for equipment leaks (40
                    CFR Part 63 Subpart H), equipment leaks from pharmaceutical processes
                    using carbon tetrachloride or methylene chloride (40 CFR Part 63 Subpart I),
                    and standards for emissions from halogenated solvent cleaning (40 CFR Part
                    63  Subpart T).  The HON also  includes innovative provisions such as
                    emissions trading, that offer industry flexibility in complying with the rule's
                    emissions goals.

                    Specific industries are regulated under other National Emission Standards for
                    Hazardous Air Pollutants (NESHAP). These standards are being developed
                    for the  pharmaceutical industry (see Section VI. C).  Title V of the CAA
                    introduces a new permit system that will require all major sources to obtain
                    operating permits to cover all applicable control requirements.  States were
                    required to develop and implement the program in 1993 and the first permits
                    were issued in 1994.  In December 1994, Schering-Plough Pharmaceutical's
                    facility in Kenilworth, New Jersey, was the first in the nation to  receive a
                    facility-wide permit under this Title V program.
       Clean Water Act (CWA)
                    The Clean Water Act, first passed in 1972 and amended in 1977 and 1987,
                    gives EPA the authority to regulate effluents from sewage treatment works,
                    chemical plants, and other industrial sources into waters.  The act sets "best
                    available" technology standards for treatment of wastes for both direct and
                    indirect (to a Publicly Owned Treatment Works (POTW)) discharges.  In
                    1983, EPA proposed effluent guidelines for the pharmaceutical manufacturing
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             Federal Statutes and Regulations
                    point source category.  These guidelines are currently undergoing revisions
                    (see Section VI. C).  The implementation of the guidelines is left to the states
                    who issue National Pollutant Discharge Elimination System (NPDES) permits
                    for each facility.

                    The pharmaceutical manufacturing effluent guidelines for  point  source
                    category (40 CFR Part 439) is divided into process specific effluent guidelines
                    as follows:

                    Fermentation - 40 CFR Part 439 Subpart A,
                    Natural product extraction - 40 CFR Part 439 Subpart B,
                    Chemical synthesis - 40 CFR Part 439 Subpart C,
                    Mixing, compounding, formulation - 40 CFR Part 439 Subpart D, and
                    Research - 40 CFR Part 439 Subpart E.

                    Each Subpart  consists of effluent limitations representing the amount of
                    effluent  reduction  possible  by using  either best  practicable  control
                    technologies (BPT), best conventional pollution technologies (BCT), or best
                    available technologies  (BAT).  BPTs are used for discharges from existing
                    point sources to control conventional and non-conventional pollutants as well
                    as some priority pollutants. BCTs are used for discharges from point sources
                    to control conventional  pollutants.  Finally, B ATs are used to control priority
                    pollutants and non-conventional pollutants when directly discharged into the
                    nation's waters.  Standards are provided for cyanide, biologic oxygen demand
                    (BOD), chemical oxygen demand (COD), total suspended solids (TSS) and
                    pH.  Guidelines for BCT and BAT for the research category, new source
                     performance standards (NSPS), and pre-treatment standards for new and
                     existing sources, are being revised and are in the final rule stage (see Section
                     VI. C).

                     The Storm Water Rule (40 CFR §122.26) requires pharmaceutical facilities
                     discharging storm water associated with industrial activities (40 CFR §122.26
                     (b)(14)(xi)) to apply for storm water permits.

       Safe Drinking Water Act Underground Injection Control Program

                     The federal Underground Injection Control (UIC) program was established
                     under the provisions of the SDWA of 1974.  This federal program prescribes
                     minimum requirements for effective state UIC programs.  Since ground water
                     is a major source of drinking water in the United States, the UIC program
                     requirements were designed to prevent contamination  of Underground
                     Sources of Drinking Water (USDW) resulting from the operation of injection
                     wells.  A USDW is defined as an "aquifer or its portion which supplies any
                     public  water system or contains a sufficient quantity of ground water to
                     supply a public water system, or contains less than 10,000 milligrams per liter
                     total dissolved solids and is not an exempted aquifer."
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                     Since the passage of the Safe Drinking Water Act, state and federal regulatory
                     agencies have modified existing programs or developed new strategies to
                     protect ground water by establishing regulations to control the permitting,
                     construction,  operation,  monitoring, and closure of injection wells.   In
                     Michigan,  where all five of the pharmaceutical industry's injection wells are
                     located, the state has not sought authority to implement the federal UIC
                     program but does regulate use of injection wells through state law. The EPA
                     is the responsible regulatory agency for implementing the UIC program in the
                     state.

                     The five wells used by the pharmaceutical companies in Michigan are termed
                     hazardous Class I injection wells since they inject  hazardous  waste into
                     formations below the USDW.  The process of selecting a site for a Class I
                     disposal well involves evaluating many conditions with the most important
                     being the determination that the underground formations  possess the natural
                     ability to contain and isolate the injected waste. A detailed study is conducted
                     to determine the suitability of the underground formation for disposal. The
                     receiving formation must be far below any usable ground waters and be
                     separated  from them by  confining layers  of rock,  which prevent fluid
                     migration  into the ground water.   The injection zone in the receiving
                     formation must be of sufficient size and have sufficient pore space to accept
                     and maintain the injected wastes.

                     Class I injection wells are regulated in 40 CFR Part 146, Subpart G. Subpart
                     G requires facilities with injection wells to submit operating reports and to
                     submit plans for testing and monitoring the wastes, hydrogeologic conditions,
                     condition of the well materials, mechanical integrity of the well, and ambient
                     conditions in adjacent aquifers. Subpart G also sets criteria for siting Class
                     I  hazardous waste injection wells, construction requirements,  corrective
                     action procedures, operating requirements, and closure plans.

       Resource Conservation and Recovery Act (RCRA)

                     The Resource Conservation and Recovery Act (RCRA) was enacted in 1976
                     to  address problems related to hazardous  and  solid waste management.
                     RCRA gives EPA  the authority to establish a list of solid and hazardous
                     wastes and to establish standards and regulations for the treatment, storage,
                     and disposal of these wastes.  Regulations in Subtitle C of RCRA address the
                     identification, generation, transportation, treatment, storage, and disposal of
                     hazardous wastes. These regulations are found in 40 CFR Part 124 and CFR
                     Parts 260-279. Under RCRA, persons who generate waste must determine
                     whether the waste is defined as solid waste or hazardous waste.  Solid wastes
                     are considered hazardous wastes if they are listed by EPA as hazardous or if
                     they exhibit characteristics of a  hazardous waste:  toxicity,  ignitability,
                     corrosivity, or reactivity.
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                    Products, intermediates, and off-specification products potentially generated
                    at pharmaceutical facilities that are considered hazardous wastes are listed in
                    40CFRPart261.33(f). Some of the handling and treatment requirements for
                    RCRA hazardous waste generators are covered under 40 CFR Part 262 and
                    include the following: determining what constitutes a RCRA hazardous waste
                    (Subpart A); manifesting (Subpart B); packaging, labeling, and accumulation
                    time limits (Subpart C); and record keeping and reporting (Subpart D).

                    Many pharmaceutical facilities store some hazardous wastes at the facility for
                    more than 90 days, and are therefore, a storage facility under RCRA. Storage
                    facilities are required to have a RCRA treatment, storage, and disposal facility
                    (TSDF) permit (40 CFR Part 262.34). Some pharmaceutical facilities are
                    considered TSDF  facilities  and are subject to the following regulations
                    covered under 40 CFR Part  264:  contingency  plans  and emergency
                    procedures (40 CFR Part 264 Subpart D); manifesting, record keeping, and
                    reporting (40 CFR Part 264 Subpart E); use and management of containers
                    (40 CFR Part 264 Subpart I); tank systems (40 CFR Part 264 Subpart J);
                    surface impoundments (40 CFR Part 264 Subpart K); land treatment (40 CFR
                    Part 264 Subpart M); corrective action of hazardous waste releases (40 CFR
                    Part 264 Subpart S); air emissions standards for process vents of processes
                    that process or generate hazardous wastes (40 CFR Part 264 Subpart AA);
                    emissions standards for leaks in hazardous waste handling equipment (40 CFR
                    Part 264 Subpart BB); and emissions standards for containers, tanks, and
                    surface impoundments that contain hazardous wastes (40 CFR Part 264
                    Subpart CC).

                    A number of RCRA wastes have been prohibited from land disposal unless
                    treated to meet specific standards under the RCRA Land Disposal Restriction
                    (LDR)  program.  The wastes covered by the RCRA LDRs are listed in 40
                    CFR Part 268 Subpart C and include a number of wastes commonly generated
                    at pharmaceutical  facilities.  Standards for the treatment and storage of
                    restricted wastes are described in Subparts D and E, respectively.

                    Many  pharmaceutical manufacturing facilities  are  also  subject to the
                    underground storage tank (UST)  program (40 CFR Part 280).  The UST
                    regulations  apply  to  facilities that  store either petroleum products or
                    hazardous substances (except hazardous  waste) identified  under the
                    Comprehensive Environmental Response, Compensation, and Liability Act.
                    UST regulations address design standards, leak detection, operating practices,
                    response to  releases, financial  responsibility for releases, and closure
                    standards.
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             Federal Statutes and Regulations
       Comprehensive Environmental Response Compensation and Liability Act (CERCLA)

                    The Comprehensive Environmental Response Compensation and Liability Act
                    of 1980 (CERCLA) and the Superfund Amendments and Reauthorization Act
                    of 1986 (SARA) provide the basic legal  framework for  the  federal
                    "Superfund" program to clean up abandoned hazardous waste sites (40 CFR
                    Part 305). The 1986 SARA legislation extended these taxes for five years and
                    adopted a new broad-based corporate environmental tax, applicable to the
                    allied chemicals (SIC 28) industry, which  includes  the Pharmaceuticals
                    industry.  In 1990, Congress passed a simple reauthorization that did not
                    substantially change the law but extended the program authority until 1994
                    and  the  taxing  authority until the end of 1995.    A  comprehensive
                    reauthorization was considered in 1994, but not passed. Since the expiration
                    of the taxing authority on December 31, 1995, taxes for Superfund have been
                    temporarily suspended. The taxes can only be reinstated by  reauthorization
                    of Superfund  or  an omnibus reconciliation act which could specifically
                    reauthorize taxing authority. The allied chemical industry pays about $300
                    million a year in Superfund chemical feedstock taxes.  Superfund's liability
                    standard is such that Potentially Responsible Parties (PRPs) may pay the
                    entire cost of clean-up at sites, even though they may be responsible for only
                    a fraction of the waste.

                    Title HI of the 1986 SARA amendments (also known as Emergency Response
                    and Community Right-to-Know Act, EPCRA) requires all manufacturing
                    facilities, including pharmaceutical facilities, to report annual information to
                    the public about stored toxic substances as well as release of these substances
                    into the environment (42 U.S.C. 9601). This is known as the Toxic Release
                    Inventory (TRI). EPCRA also establishes requirements for federal, state, and
                    local governments regarding emergency planning.  In 1994, over 300 more
                    chemicals were added to the list of chemicals for which reporting is required.

       Toxic Substances Control Act (TSCA)

                    The  pharmaceutical industry  is specifically excluded from  some of the
                    requirements of TSCA.  Any drugs manufactured, processed, and distributed
                    in commerce  are excluded by definition  from  the Inventory Reporting
                    Regulations (40  CFR Part  710.4(c)) and the Pre-Manufacturing  Notice
                    requirements (40 CFR 720.30(a)) of TSCA.
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VI.C. Pending and Proposed Regulatory Requirements

       Clean Air Act (CAA)
                    Under the Clean Air Act, National Emissions Standards for Hazardous Air
                    Pollutants  (NESHAPS) are  being  developed  for  the  pharmaceutical
                    manufacturing industry.
       Clean Water Act (CWA)
                    As part of the Clean Water Act revision process, the effluent guidelines for
                    the pharmaceutical industry (40 CFR 439) are currently being revised and
                    reviewed.  A major part of the review considers the inclusion of limitations
                    for toxic and non-conventional volatile organic pollutants. Additionally, the
                    1983 New Source Performance Standards (NSPS) for conventional pollutants
                    will also be reevaluated.
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               Federal Statutes and Regulations
 VI.D. Other Federal Regulations Affecting the Pharmaceutical Industry

        Food and Drug Administration (FDA)

                     The Food and Drug Administration (FDA)  is part of the Department of
                     Health and Human Services. FDA has the statutory authority to regulate a
                     wide range of products such as prescription and over-the-counter drugs,
                     foods, biologies (e.g., blood plasma, vaccines), medical devices (e.g., needles'
                     heart valves),  veterinary drugs, cosmetics and consumer goods that emit
                     radiation.  This authority has been granted to FDA by Congress under various
                     laws  including the Federal Food, Drug and  Cosmetic Act and the Public
                     Health Service Act.

                     There are five Centers within FDA that deal with FDA-regulated articles:
                     Center for Drug Evaluation and Research (CDER), Center for Biologies
                     Evaluation and Research (CBER), Center  for Veterinary Medicine (CVM),
                     Center for Devices and Radiological Health (CDRH), and Center for Food
                     Safety and Applied Nutrition  (CFSAN).   The Centers review scientific
                     information provided by persons wishing to place FDA-regulated articles into
                     interstate commerce in order to determine  whether regulatory requirements
                     are met.  FDA has offices throughout the U.S. where testing  of FDA-
                     regulated  articles  is  performed and  where investigators are based.
                     Investigators go to U.S. and foreign manufacturing facilities and other types
                     of facilities involved in FDA-regulated activities to verify that they are in
                     compliance with FDA regulations.

                     FDA's general approach to regulating various articles is similar, however, due
                     to  the diverse  nature of these products, there are regulatory requirements
                     tailored to each type of FDA-regulated article. Below is  a summary of
                     information relating to the type of products  regulated by CDER. Additional
                     information on other FDA-regulated articles may be located in 21 CFR or by
                     contacting FDA directly.

                     The manufacturing facilities that produce drugs for human use are regulated
                     by  CDER. The methods, facilities, and controls used for the manufacture,
                     processing, and  packing of a drug are reviewed by FDA to determine whether
                     they are adequate to ensure and preserve the  drug's identity, strength, quality
                     and purity.  These characteristics are critical  to ensure the safety and efficacy
                     of  a  drug for human use.   CDER conducts a scientific review  of
                     manufacturing methods and process controls  for the drug substance and drug
                     product. Field  investigators conduct on-site reviews to verify the accuracy
                     of the information submitted to CDER and  to determine facility compliance
                     with FDA's Good Manufacturing Practices  (GMPs).

                     FDA's review of a pharmaceutical  facility  does not  include  auditing
                     compliance with regulations pertaining to the protection of the environment.
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                                                        Federal Statutes and Regulations
                    However, in accordance with the National Environmental Policy Act of 1969
                    (NEPA),' which requires all Federal agencies to assess the environmental
                    impacts 'of their actions, CDER has integrated the consideration of the
                    environmental impacts  of approving  drug product applications into  its
                    regulatory process (21 CFR Part 25). When an environmental review under
                    NEPA is required, the review focuses on the environmental impacts of
                    consumer use and disposal of the drug and is based on information submitted
                    by the manufacturers, or on a manufacturer's certification that an application
                    falls  within an  established  category  of applications  excluded  from the
                    requirement to submit information.

                    After the original approval from CDER, an applicant may wish or need to
                    make changes in the method of manufacture, testing, etc. described in their
                    application. An applicant is required to notify FDA about each change in each
                    condition established in an approved application (e.g., ingredients, solvents,
                    processes) beyond the variations already provided for in the application (21
                     CFR §314.70(a)). Depending on the type of change, the applicant notifies
                    FDA about it in (1) a supplement requiring FDA approval before the change
                     is made (§314.70(b)), (2) a supplement for changes that may be made before
                     FDA approval (§314.70(c)), or (3) an annual report (§314.70(d)).   Changes
                     requiring FDA approval before they are made may include changes in the
                     synthesis of the drug product or changes in solvents; the addition or deletion
                     of an ingredient; and changes in the method of manufacture or in-process
                     control of the drug product manufacturing process.  The regulations specify
                     the method of reporting certain changes.  CDER also provides  additional
                     guidance on the method of reporting changes and documentation needed to
                     support changes in guidance for industry (e.g., "Guidance  for Industry,
                     Immediate Release Solid Oral Dosage Forms, Scale-Up and Post Approval
                     Changes:  Chemistry Manufacturing  and Controls, In  Vitro Dissolution
                     Testing and In Vivo Bioequivalence Documentation," November 1995).

                     The changes in  a manufacturing process that a manufacturer  may wish to
                     undertake to prevent or reduce pollution would most likely be reported in a
                     supplement requiring FDA approval before the change could be made (e.g.,
                     §§314.70(b)(l)(iv) and 314.70(b)(2)(v)). Changes such as these often require
                     the manufacturer, before submitting the supplemental application to the FDA,
                     to generate data that demonstrate the  proposed change does not adversely
                     affect the identity, strength, quality or purity of the drug. An applicant may
                     ask FDA to expedite its review if a delay in making the change would impose
                     an extraordinary hardship on the applicant (§314.70(b)).  For changes relating
                     to pollution prevention, "expedited review" is typically reserved for those
                     changes mandated by the Federal, State or  local environmental protection
                     agencies, which must be accomplished within a specified time frame. The
                     granting of an expedited review does not change the type of documentation
                     that needs to be submitted to CDER to support the change.
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              Federal Statutes and Regulations
       Summary of FDA Regulations Applicable to the Pharmaceutical Industry

                    Statutory Authority

                    The Federal Food Drug and Cosmetic Act, principally Sections 201, 301, 501,
                    502, 503, 505, 506, 507, 512, 701, 704.

                    CDER Regulations

                    21 CFR Parts 3 00-499

                    Manufacturing Information Submittal

                    Manufacturing Information  Submitted to CDER in Investigational New Drug
                    Applications  (INDs),  New  Drug   Applications  (NDAs),  Antibiotic
                    Applications,  Abbreviated  New  Drug   Applications  (ANDAs),  and
                    Abbreviated Antibiotic Drug Applications (AADAs)

                    INDs: §312.23(a)(7)(i)

                    Other applications: §§314.50(d)(l)(i) and 314.50(d)(l)(ii)(a)

                    Reporting Changes in Manufacturing Methods and Controls to CDER

                    IND Information amendments: §312.31

                    Supplements and other changes to an approved application: §314.70


                    Good Manufacturing Practices (GMPs)

                    Current Good Manufacturing Practice in Manufacturing, Processing, Packing,
                    or Holding of Drugs; General, Part 210

                    Current Good Manufacturing Practice for Finished Pharmaceuticals: Part 211
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VI.E. Other Statutes and Regulations Affecting the Pharmaceutical Industry

       State Statutes and Regulations

                    Most states have long-established broad-based  environmental regulatory
                    programs. Many of these regulatory schemes were enacted to implement
                    federal programs and have been granted local  primacy by the  USEPA.
                    Generally, the state programs are allowed to be more restrictive than federal
                    requirements and, in some cases, they are.

                    Some states with high concentrations of pharmaceutical  manufacturing
                    facilities, have their own regulations pertaining specifically to the industry.
                    For example, both New York and New Jersey have Reasonably Achievable
                    Control  Technology (RACT) requirements  for process specific volatile
                    organic  compound  (VOC)  emissions.  Other  states  may have similar
                    requirements under their own State Implementation Plans (SIPs).

       International Standards

                    The U.S. Pharmaceutical industry is largely an international industry in which
                    many companies have manufacturing  facilities and sales and  distribution
                    operations in countries other than the U.S. In addition to U.S. federal statutes
                    and regulations there are international laws, regulations, treaties, conventions
                    and  initiatives  which are  drivers  of the  environmental  programs  of
                    pharmaceutical companies. The Basel Convention, ISO 14000 standards, the
                    environmental requirements of NAFTA, and the evolving European Union
                    Directives and Regulations are a few  examples of important international
                    environmental standards and programs which affect this industry.

       Drug Enforcement Administration Regulations

                    Pharmaceutical manufacturing operations may also be regulated  under the
                     Controlled Substances Act. This Act regulates the manufacture,  distribution,
                     and dispensing of  controlled  substances and  is enforced by  the Drug
                     Enforcement Administration (DBA).  Examples of pharmaceutical products
                     regulated under this Act include Demerol, Percodan, Ritalin, Valium, and
                     Darvon. A list of controlled substances can be found in  1308  of 21 CFR.
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                     The statute provides "closed" system  for  virtually every person  who
                     legitimately handles controlled substances, other than the ultimate user. As
                     a means of controlling the distribution of regulated products, DBA sets quotas
                     limiting the  quantities which may be manufactured or produced to that
                     amount which is necessary to meet the legitimate needs of the United States.
                     The regulations  set specific requirements for  how  such compounds are
                     handled and stored at a manufacturing facility. In addition, when disposed of,
                     these substances must be destroyed in the presence of DBA personnel in
                     accordance with the regulations found in 21 CFR, Section 1307.21.
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          Compliance and Enforcement History
 VH. COMPLIANCE AND ENFORCEMENT HISTORY

       Background

                     Until  recently,  EPA has focused much of its  attention on  measuring
                     compliance with specific environmental statutes. This approach allows the
                     Agency to  track  compliance with  the  Clean  Air  Act, the Resource
                     Conservation  and  Recovery  Act,  the  Clean  Water  Act,  and  other
                     environmental statutes.  Within the last several years, the Agency has begun
                     to supplement  single-media compliance indicators with  facility-specific,
                     multimedia indicators of compliance. In doing so, EPA is in a better position
                     to track compliance with all statutes at the facility level, and within specific
                     industrial sectors.

                     A major step in building the capacity to compile multimedia data for industrial
                     sectors was the creation of EPA's Integrated Data for Enforcement Analysis
                     (IDEA) system.  IDEA has the capacity to "read into" the Agency's single-
                     media databases, extract compliance records, and match the records  to
                     individual facilities.  The IDEA  system  can  match  Air, Water, Waste,
                     Toxics/Pesticides/EPCRA, TRI, and Enforcement Docket records for a given
                     facility, and generate a list of historical permit, inspection, and enforcement
                     activity. IDEA also has the capability to analyze data by geographic area and
                     corporate holder.  As the capacity to generate multimedia compliance data
                     improves,  EPA will  make  available more  in-depth  compliance and
                     enforcement information. Additionally, sector-specific measures of success for
                     compliance assistance efforts are under development.

       Compliance and Enforcement Profile Description

                     Using inspection, violation, and enforcement data from the IDEA system, this
                     section  provides  information regarding the  historical  compliance and
                     enforcement activity of this sector.  In order to mirror the facility universe
                     reported in the Toxic Chemical Profile, the data reported within this section
                     consists of records only from the TRI reporting universe.  With this decision,
                     the selection criteria are consistent across sectors with certain exceptions.
                     For the sectors that do not normally report to the TRI program, data have
                     been provided from EPA's Facility Indexing System (FINDS) which tracks
                     facilities in all media databases. Please note, in this section, EPA does not
                     attempt to define the actual number of facilities that fall within each sector.
                     Instead, the section portrays the records of a subset of facilities within the
                     sector that are well defined within EPA databases.

                     As a check on the relative size of the full sector universe, most notebooks
                     contain an estimated number of facilities within the sector according to the
                     Bureau  of Census (See Section  II).   With sectors  dominated by small
                     businesses, such as metal finishers and printers, the reporting universe within
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        Compliance and Enforcement History
                    the EPA databases may be small in comparison to Census data. However, the
                    group selected for inclusion in this data analysis section should be consistent
                    with this sector's general makeup.

                    Following this introduction  is a list defining each data column presented
                    within this  section.  These values  represent a retrospective  summary of
                    inspections and enforcement actions, and solely reflect EPA, State, and local
                    compliance assurance activities that have been entered into EPA databases.
                    To identify any changes in trends, the EPA ran two data queries, one for the
                    five calendar years (April 1,  1992 to March 31, 1997) and the other for the
                    most recent twelve-month period (April 1, 1996 to March 31, 1997).  The
                    five-year analysis  gives an  average  level of activity for that  period for
                    comparison to the more recent activity.

                    Because most inspections focus on single-media requirements, the data
                    queries presented in this section are taken from single media databases.  These
                    databases do not provide data on whether inspections are state/local or EPA-
                    led. However, the table breaking down the universe of violations does give
                    the reader a crude measurement of the EPA's and states' efforts within each
                    media program.  The presented data illustrate the variations across EPA
                    Regions for certain sectors/ This variation may be attributable to state/local
                    data  entry  variations, specific geographic  concentrations, proximity to
                    population centers,  sensitive ecosystems, highly toxic chemicals used in
                    production, or historical noncompliance.  Hence, the exhibited data do not
                    rank regional performance or necessarily reflect which regions may have the
                    most compliance problems.

 Compliance and Enforcement Data Definitions

       General Definitions

                     Facility Indexing System (FINDS) ~ this system assigns a common facility
                     number to  EPA single-media permit records.  The FENDS  identification
                     number allows EPA to compile and  review all  permit,  compliance,
                     enforcement and pollutant release data for any given regulated facility.

                     Integrated Data for Enforcement Analysis (IDEA) -- is a data integration
                     system that  can retrieve information from the major EPA program office
                     databases. IDEA uses the FINDS identification number to link separate data
                     records from EPA's databases.  This allows retrieval of records from across
 a EPA Regions include the following states: I (CT, MA, ME, RI, NH, VT); II (NJ, NY, PR, VI); III (DC, DE, MD, PA,
 VA, WV); IV (AL, FL, GA, KY, MS, NC, SC, TN); V (EL, IN, MI, MN, OH, WI); VI (AR, LA, NM, OK, TX); VII
 (IA, KS, MO, ME); VIII (CO, MT, ND, SD, UT, WY); IX (AZ, CA, HI, NV, Pacific Trust Territories); X (AK, ID, OR,
 WA).
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                     media or statutes for any given facility, thus  creating a "master  list" of
                     records for that facility. Some of the data systems accessible through IDEA
                     are:  AIRS (Air Facility Indexing and Retrieval System, Office of Air and
                     Radiation), PCS  (Permit Compliance System, Office  of Water),  RCRIS
                     (Resource Conservation and Recovery Information System, Office of Solid
                     Waste),  NCDB (National Compliance  Data Base, Office of Prevention,
                     Pesticides, and Toxic Substances), CERCLIS (Comprehensive Environmental
                     and Liability Information System,  Superfund), and TRIS (Toxic Release
                     Inventory System). IDEA also contains information from outside sources
                     such as  Dun and Bradstreet  and the  Occupational  Safety  and  Health
                     Administration (OSHA). Most data queries displayed in notebook sections
                     IV and VII were conducted using IDEA.

       Data Table Column Heading Definitions

                     Facilities in Search ~ are based on the universe of TRI reporters within the
                     listed SIC code range.  For industries  not covered under TRI reporting
                     requirements  (metal mining, nonmetallic mineral mining, electric  power
                     generation, ground transportation, water transportation, and dry cleaning), or
                     industries in which  only a very small fraction of facilities report to TRI (e.g.,
                     printing),  the notebook uses the FINDS universe for executing data queries.
                     The SIC  code range selected for each search is defined by each notebook's
                     selected SIC code coverage described in Section II.

                     Facilities Inspected — indicates the level  of EPA and  state agency
                     inspections for the facilities in this  data search.  These values  show what
                     percentage of the facility universe is  inspected in a one-year or five-year
                     period.

                     Number  of  Inspections - measures  the total number of  inspections
                     conducted in this  sector. An inspection event is counted each time it is
                     entered into a single media database.

                     Average Time Between Inspections - provides an average length of time,
                     expressed in months, between compliance inspections at a facility within the
                     defined universe.

                     Facilities with One or More Enforcement Actions ~ expresses the number
                     of facilities that were the subject of at least one enforcement action within the
                     defined time period. This category is broken down further into federal and
                     state actions. Data are obtained for administrative, civil/judicial, and criminal
                     enforcement actions.  Administrative actions include Notices of Violation
                     (NOVs).  A facility with multiple enforcement actions is only counted once
                     in this column,  e.g.,  a facility with 3 enforcement actions counts as 1 facility.
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                    Total Enforcement Actions -- describes the total number of enforcement
                    actions identified for an industrial sector across all environmental statutes.  A
                    facility with multiple enforcement actions is counted multiple times, e.g., a
                    facility with 3 enforcement actions counts as 3.

                    State Lead Actions ~ shows what percentage of the total enforcement
                    actions are taken by state and local environmental agencies. Varying levels
                    of use by  states of EPA data systems may limit the volume of actions
                    recorded as state  enforcement  activity.   Some states ortensively report
                    enforcement activities into EPA data systems, while other states may use their
                    own data systems.

                    Federal Lead Actions ~ shows what percentage of the total enforcement
                    actions are taken by the United  States Environmental Protection Agency.
                    This value includes referrals from state agencies. Many of these actions result
                    from coordinated or joint state/federal efforts.

                    Enforcement to Inspection Rate - is a  ratio of enforcement actions to
                    inspections, and is presented for comparative purposes only.  This ratio is a
                    rough indicator of the relationship between inspections and enforcement. It
                    relates the number of enforcement actions and the number of inspections that
                    occurred within the one-year or five-year period. This ratio includes the
                    inspections and enforcement actions reported under the Clean Water Act
                    (CWA), the Clean  Air Act (CAA) and  the Resource Conservation and
                    Recovery  Act  (RCRA).  Inspections and actions from the TSCA/FIFRA/
                    EPCRA database are not factored into this ratio because most of the actions
                    taken under these programs are not the result of facility inspections.  Also,
                    this ratio  does not account for enforcement actions  arising from non-
                     inspection  compliance monitoring  activities (e.g.,  self-reported  water
                     discharges) that can result in enforcement action within the CAA, CWA, and
                     RCRA.

                     Facilities with One or More Violations Identified   ~ indicates  the
                     percentage of inspected facilities having a violation identified in one of the
                     following  data categories:  In  Violation or Significant  Violation  Status
                     (CAA);ReportableNoncompliance, Current Year Noncompliance, Significant
                     Noncompliance (CWA);  Noncompliance  and Significant Noncompliance
                     (FIFRA, TSCA, and EPCRA); Unresolved Violation and  Unresolved High
                     Priority Violation (RCRA). The values presented for this column reflect the
                     extent of noncompliance within the measured time frame,  but  do  not
                     distinguish between the severity of the noncompliance. Violation status may
                     be a precursor to an enforcement action, but does not necessarily indicate that
                     an enforcement action will occur.
 Sector Notebook Project.
120
September 1997

-------
 Pharmaceutical Industry
          Compliance and Enforcement History
                     Media Breakdown of Enforcement Actions  and Inspections -  four
                     columns identify the proportion of total inspections and enforcement actions
                     within EPA Air, Water, Waste, and FIFRA/TSCA/EPCRA databases.  Each
                     column is a percentage of either the "Total Inspections," or the  "Total
                     Actions" column.

 VILA. Pharmaceutical Industry Compliance History

                     Table 20 provides an overview of the reported compliance and enforcement
                     data for the pharmaceutical industry over the past five years (April 1992 to
                     April 1997).  These data are also broken out  by EPA Region thereby
                     permitting geographical comparisons. A few points evident from the data are
                     listed below.

                     •      Region n has more than twice the number of pharmaceutical facilities
                           than any other Region and more than half of all inspections nationally
                           were carried out in this Region. The high rate of inspections in
                           relation to the number of facilities is reflected  in the Region's
                           relatively low average time between inspections (6 months)

                     •      Regions VI had only five pharmaceutical facilities (identified by the
                           IDEA system) and a relatively high average  time between inspections.
                           However, in  the past five years four enforcement actions were
                           brought against facilities in the Region, giving it one of the highest
                           enforcement to inspection rates.

                     •      Region X had  only one pharmaceutical facility identified by the IDEA
                           system. In the past five years this facility was inspected twice and had
                           two enforcement action brought against it.
Sector Notebook Project
121
September 1997

-------
Pharmaceutical Industry
                            Compliance and Enforcement History
                    '•
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-------
 Pharmaceutical Industry
          Compliance and Enforcement History
 VH.B. Comparison of Enforcement Activity Between Selected Industries

                     Tables 21 and 22 allow the compliance history of the pharmaceutical industry
                     to be compared with the other industries covered by the industry sector
                     notebooks. Comparisons between Tables 21 and 22 permit the identification
                     of trends in compliance and enforcement records of the industry by comparing
                     data covering the last five years to that of the past year.  Some points evident
                     from the data are listed below.

                     •      The pharmaceutical industry had one of the highest inspection rates
                            as indicated by its relatively low average time between inspections (8
                            months) compared to other industries.

                     •      Compared  to other sectors, the pharmaceutical  industry had  a
                            relatively high enforcement to inspection rate (0.07) and a relatively
                            high percent of facilities inspected with violations (105 percent).

                     Tables  23 and  24 provide a more  in-depth  comparison between  the
                     pharmaceutical industry and other sectors by breaking out the compliance and
                     enforcement data by environmental statute.  As in Tables 21 and 22, the data
                     cover the last five years (Table 23) and the previous year (Table 24) to
                     facilitate the identification of recent trends. A few points evident from the
                     data are listed below.

                     •      Over  the past five years,  about  80 percent of the  industry's
                           inspections were for CAA and RCRA. Over the past year CAA and
                           RCRA inspections accounted for almost 90 percent of inspections.
                           This trend is primarily due to an increase in CAA inspections and a
                           decrease in CWA and FIFRA/TSCA/EPCRA/Other inspections.

                     •      The percentage  of CAA enforcement actions  increased from 49
                           percent over the past five years to 71 percent in the past year.  At the
                           same time the percentage of CWA enforcement actions  decreased
                           from 25 percent to 14 percent.
Sector Notebook Project
123
September 1997

-------
Pharmaceutical Industry
                                      Compliance and Enforcement History
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                               124
September 1997

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 Pharmaceutical Industry
         Compliance and Enforcement History







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Sector Notebook Project
125
September 1997

-------
Pharmaceutical Industry
       Compliance and Enforcement History
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126
September 1997

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Sector Notebook Project
127
September 1997

-------
Pharmaceutical Industry
        Compliance and Enforcement Histoi
VII.C. Review of Major Legal Actions
                    This  section provides summary information about major cases that have
                    affected this sector, and Supplementary Environmental Projects (SEPs).
                    SEPs are compliance agreements that reduce a facility's stipulated penalty in
                    return for an environmental project that exceeds the value of the reduction.
                    Often, these projects fund pollution prevention activities that can significantly
                    reduce the future pollutant loadings of a facility.
       VII.C.1. Review of Major Cases
                     As indicated in EPA's Enforcement Accomplishments Report, FY1995 and
                     FY1996 publications, 5 significant enforcement actions were resolved between
                     1994 and 1996 for the pharmaceutical industry.

                     In the Matter of Ciba-Geigy, Inc.: On November 7, 1994, Region II issued
                     an administrative consent order to Ciba-Geigy, Inc., assessing a penalty of
                     $130,000 for violations of EPCRA at its Toms River, New Jersey, facility.
                     The order was based upon an inspection of Ciba-Geigy's facility that resulted
                     in a sixteen count complaint alleging that Ciba-Geigy failed to report that it
                     used certain of the following: copper compounds; glycol ethers; chromium
                     compounds; cobalt compounds; C.I. Disperse Yellow 3; diethanolamine and
                     ethylene glycol during the calendar years 1988 through 1991.

                     Ciba-Geigy Superfund Site:  On October 18, 1995,  Region II issued an
                     administrative order on consent under  Sections  104,  107,  and 122 of
                     CERCLA to the Ciba-Geigy Corporation.  The order requires Ciba-Geigy to
                     perform, under EPA oversight, a feasibility study for Operable Unit Two to
                     develop and  evaluate remedial alternatives for approximately twenty-one
                     potential source areas of groundwater contamination on  the site.  The
                     estimated cost of the work that Ciba-Geigy will perform is $20 million. In
                     addition, Ciba-Geigy will also pay all of EPA's unreimbursed past response
                     costs, $797,000, plus all of EPA's future response costs, including oversight
                     costs.

                     The site is on the National Priorities List and located in Toms River, Ocean
                     County, New Jersey. Groundwater at the site is contaminated with organic
                     and inorganic compounds, and emanates from surface and subsurface former
                     disposal areas on the site. Pursuant to a settlement with EPA in 1994, Ciba-
                     Geigy is currently remediating the groundwater contamination. EPA recently
                     completed a baseline public health risk assessment or source area surface
                     soils, as well as a remedial investigation to examine the nature and extent of
                     the contamination in the source areas at the site. In performing the feasibility
                     study  for the source areas, Ciba-Geigy has agreed to adopt EPA's risk
                     assessment and remedial investigation report.
 Sector Notebook Project
128
September 1997

-------
 Pharmaceutical Industry
          Compliance and Enforcement History
                     Takeda Chemical Products USA, Inc.  (NC): On August 31, 1995, Region
                     IV entered into a consent agreement/consent order (CACO) resolving claims
                     against Takeda Chemical Products USA, Inc., for violations of RCRA at its
                     vitamin manufacturing plant in Wilmington, North Carolina.  As part of a
                     solvent extraction process, Takeda generated a by-product referred to as
                     DAS-fuel, which Takeda intended to burn for energy recovery.  Prior to
                     receiving any permits to burn the DAS-fuel, Takeda generated DAS-fuel and
                     stored it on-site for a period in excess of 90 days without a permit or interim
                     status, and later shipped it off-site.  EPA determined that the DAS-fuel
                     (essentially spent toluene mixed with DAS water and polymers) was F005
                     hazardous waste.  As a result, on September 24,  1994, Region IV issued a
                     complaint for illegal storage of hazardous waste, failure to make a hazardous
                     waste determination, and failure to manifest the DAS-fuel shipped off-site.
                     The CACO requires Takeda to pay a civil penalty of $99,000,  but allows
                     Takeda to bring DAS-fuel back on-site for reprocessing, provided Takeda
                     manages any waste it produces as a result as a hazardous waste.

                     Abbott Laboratories: A  consent agreement and final order was signed in
                     September 1995, concerning Abbott Laboratories Corporation's violations of
                     RCRA standards applicable to the burning of hazardous waste in boilers and
                     industrial furnaces (BIF) at its North Chicago, Illinois facility. Negotiations
                     with Abbott Laboratories after issuance of the complaint in February 1994
                     resulted in a penalty of $182,654. Abbott also agreed to  conduct  a
                     supplemental environmental project (SEP) that will allow Abbott to recover
                     and recycle the methylene chloride produced in its manufacturing processes
                     and will reduce fugitive methylene chloride emissions. The SEP involves
                     three separate, albeit similar, operations, replacing  "wet"  vacuum  pump
                     systems with "dry" pumps  and high efficiency condensers. The projected cost
                     of the SEP is $480,000.

       Vn.C.2. Supplementary Environmental Projects (SEPs)

                     Supplemental environmental projects (SEPs)  are enforcement options that
                     require the non-compliant  facility to complete specific projects.  Information
                     on SEP cases can be accessed via the internet at EPA's Enviro$en$e website:
                     http ://es.inel.gov/sep.
Sector Notebook Project
129
September 1997

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Page 130 intentionally left blank.

-------
 Pharmaceutical Industry	Activities and Initiatives

 Vm. COMPLIANCE ACTIVITIES AND INITIATIVES

                     This section highlights the activities undertaken by this industry sector and
                     public  agencies  to  voluntarily  improve  the  sector's environmental
                     performance.   These activities  include those independently  initiated by
                     industrial trade associations.  In this section, the notebook also contains a
                     listing and description of national and regional trade.associations.

 VIII.A. Sector-related Programs and Activities

                     The Pharmaceutical Research and Manufacturers of America (PhRMA) and
                     EPA  are  considering  developing  compliance and regulations  guides,
                     concerning the  interactions  of EPA and  FDA  regulations  for  the
                     pharmaceutical industry.

 VIH.B. EPA Voluntary Programs

       33/50 Program

                     The 33/50 Program is a ground breaking program that has  focused  on
                     reducing pollution from seventeen high-priority chemicals through voluntary
                     partnerships with industry. The program's name stems from its goals: a 33%
                     reduction in toxic releases and transfers by 1992, and a 50% reduction by
                     1995,  against a baseline of 1.5 billion pounds of releases and  transfers in
                     1988.  The results have been impressive: 1,300 companies have joined the
                     33/50  Program (representing over 6,000 facilities) and have reached the
                     national targets a year ahead of schedule.  The 33% goal was reached in 1991,
                     and the 50% goal - a reduction of 745 million pounds of toxic wastes — was
                     reached in 1994.  The 33/50 Program can provide case studies on many of the
                     corporate accomplishments in reducing waste.

                     Table  25  lists those  companies participating in the 33/50 program that
                     reported the SIC codes 2833 and 2834 to TRI.  Some of the companies
                     shown also listed facilities that are not producing Pharmaceuticals.  The
                     number of facilities within each company that are participating in the 33/50
                     program and that report pharmaceutical SIC codes is shown.  Where available
                     and quantifiable against 1988 releases and transfers, each company's 33/50
                     goals for 1995  and the actual total releases and transfers and percent
                     reduction between 1988 and 1994 are presented.  At the time of publication
                     of this document (August  1997) 1995  33/50 Program TRI data were not
                     available.

                     Table 20 shows that 34 companies comprised of 160 facilities reporting SIC
                     2833 and 2834 are participated in the 33/50 program.  For those companies
                     shown with more than one pharmaceutical manufacturing facility, all facilities
                     may not be participating in 33/50.  The 33/50 goals shown for companies with

Sector Notebook Project                    131                            September 1997

-------
Pharmaceutical Industry
                     Activities and Initiatives
                     multiple pharmaceutical facilities, however, are company-wide, potentially
                     aggregating  more than  one  facility  and  facilities  not  carrying  out
                     pharmaceutical operations.  In addition to company-wide goals, individual
                     facilities within a company may have their own 33/50 goals  or may be
                     specifically listed as not participating in the 33/50 program.  Since the actual
                     percent reductions shown in the last column apply to all of the companies'
                     pharmaceutical   manufacturing   facilities   and   only  pharmaceutical
                     manufacturing facilities,  direct  comparisons  to those  company goals
                     incorporating non-pharmaceutical facilities or excluding certain facilities may
                     not be possible.  For information on specific facilities participating in 33/50,
                     contact David Sarokin (202-260-6907) at the 33/50 Program Office.
 Sector Notebook Project
132
September 1997

-------
 Pharmaceutical Industry
                      Activities and Initiatives
Table 25: Pharmaceutical Industry Participation in the 33/50 Program
Parent Company
(Headquarters Location)
3M Minnesota Mining &
Mfg.. Company -
St. Paul, MN
Abbott Laboratories -
North Chicago, IL
American Home Products
Corporation -
Madison ,NJ
Anabolic Incorporated -
Irvine, CA
Baxter International Inc. -
Deerfield, IL
Boehringer Ingelheim Corp. -
Ridgefield, CT
Bristol-Myers Squibb Co. -
New York, NY
Burroughs Wellcome Co. -
Durham, NC
Ciba-Geigy Company -
Tarrytown, NY
Coating Place Incorporated -
Verona, WI
Dow Chemical Company -
Midland, M
Eastman Kodak Company -
Rochester, NY
Eli Lilly and Company -
[ndianapolis, IN
Fisons Company -
Rochester, NY
Ganes Chemicals Inc. -
Carlstadt, NJ
Hoechst Celanese Company -
Corpus Christi, TX
r-foffmann-La Roche Inc. -
Nutley, NJ
Johnson & Johnson -
*Jew Brunswick, NJ
Mallinckrodt Group Inc. -
Saint Louis, MO
Merck & Company Inc. -
Whitehouse Station, NJ
Company-Owned
Pharmaceutical
Facilities Reporting
33/50 Chemicals
2
6
19
1
8
2
15
2
14
1
1
1
7
1
2
1
5
2
1
7
Company-wide
% Reduction
Goal1 (1988-
1995)
70
20
50
75
80
50
50
26
50
***
50
50
50
***
***
50
62
65
50
50
1988TRI
Releases and
Transfers of
33/50 Chemicals
(pounds)
885,011
3,017,869
1,828,970
39, 602
921,282
198,500
4, 876, 002
469, 075
2,613,266
149, 000
115,000
87, 350
5, 749, 879
3,395
67,018
0
2, 154,667
258, 090
0
5, 863, 293
1994TRI
Releases and
Transfers of
33/50 Chemicals
(pounds)
194,850
2, 869, 793
930, 992
0
33,312
247, 166
2, 305, 269
193,171
1, 179,471
0
109, 100
15,766
1, 194,760
2,229
19,586
0
1,230,361
234, 444
500
927, 225
Actual %
Reduction for
Pharmaceutical
Facilities (1988 -
1994)
78
5.0
49
100
96
-24.5
53
59
55
100
5
82
79
34
71
~
43
9
-
84
Sector Notebook Project
133
September 1997

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Pharmaceutical Industry
                      Activities and Initiatives
Table 25: Pharmaceutical Industry Participation in the 33/50 Program
Monsanto Company -
Saint Louis, MO
Par Pharmaceutical Inc. -
Spring Valley, NY
Pcrrigo Company -
Allcgan, MI
Pfizer Incorporated -
New York, NY
Sandoz Corporation
New York, NY
Schering-Plough Corp, -
Madison, NJ
Smithklinc Bcccham
Americas -
Philadelphia, PA
Solvay America Inc. -
Houston, TX
Syntex USA Incorporated -
Palo Alto, CA
Tishcon Corporation -
Wcstbury.NY
United Organics Corp. -
Williamston.NC
Upjohn Company -
Kalamazoo, ME
Upsher-Smith Laboratories
Inc.-
Minncapolis, MN
Warner-Lambert Company -
Morris Plains, NJ

3
1
2
10
18
7
6
1
3
2
1
3
1
4
160
25
***
95
50
50
70
81
*
33
**
*
50
100
40

9,200
194,099
638, 235
2,492,314
572,915
3,181,202
2, 882, 573
0
1,093,051
3,900
0
7,128,339
94, 000
197,540
47, 784, 637
3,480
0
0
3, 250, 940
100,439
1,867,558
35, 469
36, 474
393, 493
113,000
5,950
5,654, 150
320, 000
242, 638
23,711,586
62
100
100
-30
82
41
99
—
64
-2797
—
21
-240
-22
50
 Source: US EPA 33/50 Program Office, 1996. 1995 33/50 TRI data was not available at time of publication.
 1 Company-wide Reduction Goals aggregate all company-owned facilities which may include facilities not producing Pharmaceuticals.
 * » Reduction goal not quantifiable against 1988 TRI data.
 ** =• Use reduction goal only.
 *** - No numeric reduction goal.
        Environmental Leadership Program
                      The  Environmental Leadership  Program (ELP)  is  a national  initiative
                      developed by EPA that focuses on improving environmental performance,
                      encouraging voluntary compliance, and building working relationships with
                      stakeholders.  EPA initiated a one year pilot program in 1995 by selecting 12
                      projects at industrial facilities and federal installations that demonstrate the
                      principles of the ELP program.   These principles include:  environmental
                      management  systems,  multimedia  compliance  assurance,   third-party
                      verification of compliance, public measures of accountability,  pollution
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                     prevention, community involvement, and mentor programs. In return for
                     participating, pilot participants received public recognition and were given a
                     period of time to correct any violations discovered during these experimental
                     projects.

                     EPA is making plans to  launch  its full-scale Environmental  Leadership
                     Program in 1997. The full-scale program will be facility-based with a 6-year
                     participation cycle. Facilities that meet certain requirements will be eligible
                     to participate, such as having a community outreach/employee involvement
                     programs  and an environmental management system (EMS) in place for 2
                     years.   (Contact: http://es.inel.gov/elp or  Debby Thomas, ELP Deputy
                     Director, at 202-564-5041)
       Project XL
                     Project XL was initiated in March 1995 as a part of President Clinton's
                     Reinventing Environmental Regulation initiative.  The projects  seek to
                     achieve cost effective environmental benefits by providing participants
                     regulatory flexibility on the condition that they produce greater environmental
                     benefits. EPA and program participants will negotiate and sign a Final Project
                     Agreement, detailing  specific environmental objectives that  the regulated
                     entity shall satisfy. EPA will  provide regulatory flexibility as an incentive for
                     the  participants' superior environmental performance.   Participants  are
                     encouraged  to seek stakeholder support from local governments, businesses,
                     and environmental groups.  EPA hopes to implement fifty pilot projects in
                     four categories, including industrial facilities, communities, and government
                     facilities regulated  by EPA.  Applications are being accepted on a rolling
                     basis.

                     In  1996,   EPA  accepted  a proposal  by  Merck  to  deliver  superior
                     environmental  protection   while  allowing  flexible  operation   at  its
                     pharmaceutical manufacturing facility near Elkton, Virginia. Merck, along
                     with its stakeholders, developed a simplified air permit for the facility that will
                     cap total air emissions of criteria pollutants at less than recent actual levels
                     and allow the  facility  to make changes and additions  to its manufacturing
                     processes as soon as they are needed without prior approval. The upfront
                     environmental benefit which will enable Merck to operate flexibly under the
                     emissions cap  will  come from converting the coal burning powerhouse to
                     natural gas.  This conversion will reduce the site's actual air emissions by over
                     900 tons per year of criteria pollutants, and 50 tons per year of hazardous air
                     pollutants.

                     Under the proposal, EPA and the Virginia  Department of Environmental
                     Quality (VADEQ) will adopt the Prevention of Significant Deterioration
                     (PSD)  permit through  different mechanisms  under  their  respective
                    jurisdictions. EPA plans to promulgate a site-specific rule making in order to
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                    make adjustments to current applicable regulations to allow for the flexible
                    operation of the permit. The Virginia State Air Pollution Control Board will
                    promulgate a variance to make the PSD permit legally enforceable under state
                    laws. These proposed actions and the  draft permit were subject to public
                    comment and it is expected that the permit will be issued to Merck during
                    1997.

                    For additional  information regarding  XL  projects, including application
                    procedures and criteria, see the May  23,  1995 Federal Register Notice.
                    (Contact: Fax-on-Demand Hotline 202-260-8590, Web: http://www.epa.gov/
                    ProjectXL, or Christopher Knopes at EPA's Office of Policy, Planning and
                    Evaluation 202-260-9298)

       Climate Wise Program

                    Climate Wise is helping US industries turn energy efficiency and pollution
                    prevention into a corporate asset.  Supported by the technical assistance,
                    financing information and public  recognition  that Climate Wise offers,
                    participating  companies  are developing  and launching  comprehensive
                    industrial energy efficiency and pollution prevention action plans that save
                    money and protect the environment. The nearly 300 Climate Wise companies
                    expect to save more than $300 million and reduce greenhouse gas emissions
                    by 18 million metric tons of carbon dioxide  equivalent by the year 2000.
                    Some of the actions companies  are undertaking to  achieve these results
                    include:  process improvements, boiler and steam system optimization, air
                    compressor system  improvements, fuel switching, and waste heat recovery
                    measures including cogeneration.  Created as part of the President's Climate
                    Change Action Plan, Climate Wise is jointly operated by the Department of
                    Energy and EPA. Under the Plan many other programs were also launched
                    or upgraded including Green Lights, WasteWi$e and DoE's Motor Challenge
                    Program.  Climate Wise provides an  umbrella for these programs which
                    encourage company participation by providing information on the range of
                    partnership opportunities available. (Contact:  Pamela Herman, EPA, 202-
                    260-4407 or Jan Vernet, DoE, 202-586-4755)

       Energy Star Buildings Program

                    EPA's ENERGY STAR Buildings Program is a voluntary, profit-based program
                    designed to  improve the energy-efficiency in commercial and industrial
                    buildings. Expanding the successful Green Lights Program, ENERGY STAR
                    Buildings was launched in 1995. This program relies on a 5-stage strategy
                    designed to maximize energy savings thereby lowering energy bills, improving
                    occupant comfort,  and preventing pollution — all  at the same  time. If
                    implemented in every commercial and industrial building in the United States,
                    ENERGY STAR Buildings could cut the nation's energy bill by up to $25 billion
                    and prevent up to 35%  of carbon dioxide emissions. (This is equivalent to
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                    taking 60 million cars of the road). ENERGY STAR Buildings participants
                    include corporations; small and medium sized businesses; local, federal and
                    state governments; non-profit groups; schools; universities; and health care
                    facilities. EPA provides technical and  non-technical support  including
                    software, workshops, manuals, communication tools, and an information
                    hotline. EPA's Office of Air and Radiation manages the operation of the
                    ENERGY STAR Buildings Program. (Contact: Green Light/Energy Star Hotline
                    at 1-888-STAR-YES or Maria Tikoff Vargas, EPA Program Director at 202-
                    233-9178  or  visit the  ENERGY STAR  Buildings Program website  at
                    http ://www. epa.gov/appdstar/buildings/)

       Green Lights Program

                    EPA's Green  Lights program was initiated in  1991 and has the goal  of
                    preventing pollution by encouraging U.S. institutions to use energy-efficient
                    lighting technologies.   The  program saves money  for businesses and
                    organizations  and  creates a cleaner environment  by reducing pollutants
                    released into the atmosphere. The program has over 2,345 participants which
                    include major corporations, small and medium sized businesses, federal, state
                    and local governments, non-profit groups, schools, universities, and health
                    care facilities.  Each participant  is required to survey their facilities and
                    upgrade lighting wherever it is profitable. As of March 1997, participants had
                    lowered their electric bills by $289 million annually.  EPA provides technical
                    assistance to the participants through a decision support software package,
                    workshops and manuals, and an information hotline.  EPA's Office of Air and
                    Radiation is responsible for operating the Green Lights Program.  (Contact:
                    Green Light/Energy Star  Hotline  at 1-888-STARYES or Maria Tikoff
                    Vargar, EPA Program Director, at 202-233-9178 the )

       WasteWi$e Program

                    The WasteWiSe Program  was started in 1994 by EPA's Office of Solid Waste
                    and Emergency Response. The program is aimed  at reducing municipal solid
                    wastes by  promoting  waste  prevention,  recycling  collection  and the
                    manufacturing and purchase of recycled products. As of 1997, the program
                    had about 500  companies as members, one third  of whom are Fortune 1000
                    corporations.  Members  agree to identify and implement actions  to reduce
                    their solid wastes  setting waste reduction goals and providing EPA with
                    yearly progress reports.   To member companies, EPA, in turn, provides
                    technical assistance, publications, networking opportunities, and national and
                    regional recognition.  (Contact: WasteWi$e Hotline at 1-800-372-9473 or
                    Joanne Oxley, EPA Program Manager, 703-308-0199)
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       NICE3
                    The U.S. Department of Energy is administering a grant program called The
                    National Industrial Competitiveness through Energy, Environment, and
                    Economics (NICE3). By providing grants of up to 45 percent of the total
                    project cost, the program encourages industry to reduce industrial waste at
                    its source and become more energy-efficient and cost-competitive through
                    waste minimization efforts.  Grants are used by industry to design, test, and
                    demonstrate new processes and/or equipment with the potential to reduce
                    pollution and increase energy  efficiency.   The  program  is open to  all
                    industries; however,  priority is given to proposals from participants in the
                    forest products, chemicals, petroleum refining, steel, aluminum, metal casting
                    and glass manufacturing sectors. (Contact: http//www. oit.doe.gov/access/
                    niceS, Chris Sifri, DOE, 303-275-4723 orEricHass, DOE, 303-275-4728)
       Design for the Environment (DfE)
                     DfE is working with several industries to identify cost-effective pollution
                     prevention strategies that reduce risks to workers and the environment. DfE
                     helps  businesses compare and evaluate the performance,  cost, pollution
                     prevention benefits, and human health and environmental risks associated with
                     existing and alternative technologies.  The goal of these projects is to
                     encourage businesses to consider and use cleaner products, processes, and
                     technologies. For more information about the DfE Program, call (202) 260-
                     1678.  To obtain copies of DfE materials or for general information about
                     DfE, contact EPA's Pollution Prevention Information Clearinghouse at (202)
                     260-1023 or visit the DfE Website at http://es.inel.gov/dfe.
VIQ.C. Trade Association/Industry Sponsored Activity

       Vm.C.l. Environmental Programs
                     The Pharmaceuticals Research and Manufacturers of America (PhRMA)
                     coordinates  the research-based  pharmaceutical  industry's  response to
                     industry-specific environmental issues, such as the pharmaceutical MACT.
                     PhRMA  works  through an environmental  committee,  a series  of
                     subcommittees responsible for regulatory areas such as water and air, and ad
                     hoc work groups to address narrowly-focused issues.

                     The research-based pharmaceutical industry also relies on other broad-based
                     trade  associations for issues  that affect the larger business community.
                     Several of the PhRMA members are also members  of the  Chemical
                     Manufacturers  Association (CMA) and  therefore are part of  CMA's
                     Responsible Care® Initiative.
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                    In addition, many pharmaceutical companies have been implementing their
                    own environmental programs and initiatives to reduce the environmental
                    impacts of their products and manufacturing processes.  These programs are
                    both company-wide and at the facility level.  More information on such
                    programs can be obtained by contacting individual companies and facilities.
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       Vm.C.2. Summary of Trade Associations

             Pharmaceutical Research and Manufacturers
             of America (PhRMA)
             1100 15th Street, NW
             Washington, D.C. 20035
             Phone: (202) 835-3400
             Fax: (202) 835-3414
                      Budget:$20,000,000
                      Staff: 80
                      Members: 40 companies
                      Affiliates: 30 companies
             The Pharmaceutical Research and Manufacturers of America (PhRMA) is a non-profit
             organization which was established in 1958. Its main function is to assist research-
             based pharmaceutical companies in discovery, development, and marketing of new
             drugs for humans.  Comprised of most of the largest pharmaceutical companies in the
             United States, PhRMA members are primarily engaged in research and development
             of new medicines.  To be a member of PhRMA, a company must be heavily involved
             in research and development (R&D) and must also manufacture and market finished
             dosage-form drugs under their own brand name.  PhRMA member companies invest
             nearly $19 billion a year in discovering and developing new drugs.  Additionally,
             PhRMA members account for approximately 90% of total pharmaceutical sales in the
             United States.
              Generic Pharmaceutical Industry
              Association
              16201 Street, NW
              Washington, D.C. 20006-4005
              Phone: (202) 833-9070
              Fax: (202) 833-9612
                 Budget: $1-2,000,000
                 Staff: 6
                 Members: 46 companies
              The Generic  Pharmaceutical Industry  Association (GPIA)  is a  primary  trade
              association for manufacturers and distributors of generic drugs. Its main publication
              is "GPIA News".
              National   Pharmaceutical   Alliance
              (NPA)
              421 King Street, Suite 222,
              Alexandria, VA 22314
              Phone: (703) 836-8816
              Fax: (703) 549-4749
                  Budget: $250-500,000
                  Members: 165 companies
              The National Pharmaceutical Alliance (NPA) is an organization which represents the
              interests of small pharmaceutical companies and allied industries.  Members of NPA
              develop bioequivalent versions of major branded products, create  products of
              alternative combinations, strengths, and/or dosage forms, and market products which
              are not produced by larger companies and which would not be available to the public
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              otherwise. NPA assists in meeting these goals for its member companies. NPA also
              publishes a bi-monthly journal called "NPA & News, Washington Report."
              American Pharmaceutical Association
              (APhA)
              2215 Constitution Ave. NW
              Washington, DC 20037
              Phone: (202) 628-4410
              Fax:(202)783-2351
                  Budget: $12,000,000
                  Members: 44,000
              The American Pharmaceutical Association (APhA) is a professional society that
              includes pharmacists in all practice settings, educators, students, researchers, editors
              and publishers of pharmaceutical literature, pharmaceutical chemists and scientists,
              and food and drug officials. APhA promotes quality health care and comprehensive
              pharmaceutical care through the appropriate use of pharmacy services. APhA works
              to: represent the interests of the profession before governmental bodies; interprets and
              disseminates information on developments in health care; and assure quality pharmacy
              services and patient care.  APhA fosters professional education and training  of
              pharmacists; supports the Academy of Pharmaceutical Research and Science, the
              Academy of Pharmacy Practice and Management, and the Academy of Students of
              Pharmacy.   APhA also publishes a quarterly newsletter, Academy Reporter, and
              monthly journals  including,  American  Pharmacy (Journal of the American
              Pharmaceutical Association) and Journal of Pharmaceutical Sciences.
             United States Pharmacopeial
             Convention (USP)
             12601 Twinbrook Pky.
             Rockville, MD 20852
             Phone: (301)881-0666
             Fax: (301) 816-8247
                  Budget: $20,000,000
                  Members: 395
             The United States Pharmacopeial Convention (USP) is a recognized authority in
             medicine, pharmacy,  and allied sciences.   USP  revises and publishes  legally
             recognized compendia of drug standards including the National Formulary.
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                    Activities and Initiatives
             National Association of Pharmaceutical Manufacturers (NAPM)
             320 Old Country Road - Suite 205
             Garden City, NY 11530
             Phone: (516) 741-3699
             Fax:(516)741-3696
             Nonprescription Drug Manufacturers Association
             1150 Connecticut Avenue, NW
             Washington, DC 20036
             Phone: (202) 429-9260
             Fax: (202) 223-6835
             National Wholesale Druggist's Association
             1821 Michael Faraday Drive
             Suite 400
             Reston, VA 22090
             Phone: (703) 787-0000 ext. 240
             Fax: (703) 787-6930
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 Pharmaceutical Industry
                       Contacts and References
 EX. CONTACTS/ACKNOWLEDGMENTS/REFERENCES
                     For further information on selected topics within the pharmaceutical industry
                     a list of publications and contacts are provided below:
 Contacts3
Name
Emily Chow
Joanne Berman
Frank Hund
Randy McDonald
Umesh Dholakia
Nancy Sager
Daniel Kearns
Charles E. Eirkson,
III
Mervin Parker
Buzz L. Hoffman
Tom White
Organization
EPA/OECA
EPA/OECA
EPA/OW
EPA/OA
EPA Region II
FDA- Center for Drug
Evaluation and
Research
FDA - Center for
Biologies Evaluation
and Research
FDA - Center for
Veterinary Medicine
FDA - Center for
Devices and
Radiological Health
FDA - Center for Food
Safety and Applied
Nutrition
PhRMA
Telephone
(202) 564-7071
(202) 564-7064
(202)260-7182
(919)541-5402
(212) 637-4023
(301)594-5629
(301)827-3031
(301)594-1683
(301)594-2186
(202)418-3005
(202) 835-3546
Subject
Chemical Industry Branch,
Regulatory requirements and
compliance assistance
Chemical Industry Branch,
Regulatory requirements and
compliance assistance
Regulatory Requirements (CWA)
Regulatory Requirements (CAA)
Regulatory Requirements (CAA)
Information on Human Drugs
Information on Biologies
Information on Veterinary
Medicine
Information on medical devices
and radiological health
Information on foods

CWA: Clean Water Act
OECA: Office of Enforcement and Compliance Assurance
OA: Office of Air
OW: Office of Water
FDA: Food and Drug Administration
PhRMA: Pharmaceutical Research and Manufacturers of America
a Many of the contacts listed above have provided valuable background information and comments during development
of this document. EPA appreciates this support and acknowledges that the individuals listed do not necessarily endorse
all statements made within this notebook.
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                    Contacts and References
                                   REFERENCES

Section IT: Introduction to the Pharmaceutical Industry

Opportunities and Challenges for Pharmaceutical Innovation: PhRMA Industry Profile,
       Pharmaceutical Research and Manufacturers of America, Washington, DC., 1996.

Standard Industrial Classification Manual,  1987, Executive Office of the President, Office of
       Management and Budget, Washington, DC., 1987.

Approved Drug Products with Therapeutic Equivalence Evaluations. FDA, Sixteenth Edition, 1996.

United States 1992 Census of Manufacturers for Drugs,  Industry Series, US Department of
       Commerce, Bureau of the Census, Washington, DC., 1992, (MC92-I-28C).

United States Industrial Outlook 1994,  US Department of Commerce, International  Trade
       Administration, Washington, DC., 1994, chapter 43.

Section OT; Industrial Process Description

Encyclopedia of Polymer Science and Engineering, Vol.6, John Wiley and Sons, Inc., New York,
       1986, p.514-515.

Guidelines to Pollution Prevention: The Pharmaceutical Industry, US EPA, Washington, DC.,
       October 1991, (EPA/625/7-91/017).

Development Document for Proposed Effluent Limitations Guidelines and Standards for the
       Pharmaceutical Point Source  Category, US EPA, Washington, DC., February, 1995,
       (EPA/821-R-95-019).

Control of Volatile Organic Compound Emissions from Batch Processes, US EPA Guideline
       Series, Research Triangle Park,  NC., November, 1993, (EPA-453/R-93-017).

Guidance for Industry: Manufacture, Processing or Holding of Active Pharmaceutical Ingredients,
       U.S. Food and Drug Administration, August 1996.

Kirk-Othmer Encyclopedia of Chemical Technology, Fourth Edition, John Wiley and Sons, New
       York, 1994.

Remington:  The Science of Practice of Pharmacy,  19th edition, Mack Publishing Co., Easton,
       Pennsylvania, 1995.

Riegel's Handbook of Industrial Chemistry, Chapter 25: The Pharmaceutical Industry, Jeffrey H.
       Watthey, Van Nostrand Reinhold, New York, 1992.
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                     Contacts and References
Perry's Chemical Engineers' Handbook, Sixth Edition, McGraw-Hill Book Company, 1984.

Personal Communication, Schering-Plough Pharmaceuticals, Kenilworth, New Jersey, October
       1996.

Air Pollution Engineering Manual - Chapter 16: Pharmaceutical Industry, Richard Grume and
       Jeffrey Portzer, eds. Buonicore, A.J., and Davis,  W.T., Air and Waste Management
       Association, Van Nostrand Reinhold, New York, 1992.

Air Pollution Control Equipment, Volume II Gases, Louis Theodore, and Anthony J. Buonicore
       CFC Press, 1998.

Section V; Pollution Prevention Opportunities

Pharmaceutical Industry  Waste Minimization Initiatives (White Paper), Pharmaceutical Research
       and Manufacturers of America, 1997.

Guidelines to Pollution Prevention: The Pharmaceutical Industry, US EPA,  Washington, DC.,
       October 1991, (EPA/625/7-91/017).

Profile of the Inorganic Chemical Industry, US EPA, Washington DC., September, 1995 (EPA,
       310-R-95-004).

Pollution  Prevention Research  Opportunities  in  the  Pharmaceutical Industry,  New Jersey
       Institute of Technology, Emissions Reduction Research Center, New Jersey, April 1991.
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                               APPENDIX A

       INSTRUCTIONS FOR DOWNLOADING THIS NOTEBOOK


          Electronic Access to this Notebook via the World Wide Web (WWW)


This Notebook is available on the Internet through the World Wide Web.  The EnviroSenSe
Communications Network is a free, public, interagency-supported system operated by EPA's Office
of Enforcement and Compliance Assurance and the Office of Research and Development. The
Network allows regulators, the regulated community, technical experts, and the general public to
share information regarding: pollution  prevention and innovative technologies; environmental
enforcement and compliance assistance; laws, executive orders, regulations, and policies; points of
contact for services and equipment; and other related topics. The Network welcomes receipt of
environmental messages, information, and data from any public or private person or organization.

ACCESS THROUGH THE ENVIROSENSE WORLD WIDE WEB

      To access this Notebook through the EnviroSenSe World Wide Web, set your World Wide
      Web Browser to the following address:
      http://es.epa.gov/comply/sector/index.html
      or use


      WWW.epa.gOV/OeCa -  then select the button labeled Industry and Gov't
                                   Sectors and select the appropriate sector from the
                                   menu. The Notebook will be listed.

      Direct technical questions to the Feedback function at the bottom of the web page or to
      Shhonn Taylor at (202) 564-2502
                                  Appendix A

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