H325604

 HQ H325604 August 31, 2023 OT:RR:CTF:FTM H325604 JER CATEGORY: Classification TARIFF NO.: 2941.30; 2941.90 JoAnne Colonnello, Center Director Pharmaceuticals, Health, and Chemicals Center of Excellence and Expertise U.S. Customs and Border Protection 301 E. Ocean Blvd., Suite 700 Long Beach, California 90802 ATTN: Ms. Cathy Sheridan, Import Specialist RE: Internal Advice; Tariff classification of Chlortetracycline Hydrochloride, Chlortetracycline Feed Grade Concentrate, and Neomycin Sulfate Dear Center Director, This letter is in response to the internal advice request, dated April 13, 2022, initiated by Transmodal Corporation, on behalf of Pharmgate, LLC (“Pharmgate” or “Importer”), concerning the tariff classification of three (3) products used in animal feed under the Harmonized Tariff Schedule of the United States (“HTSUS”). The Importer requested that certain information submitted in connection with this internal advice be treated as confidential. Inasmuch as this request conforms to the requirements of 19 C.F.R. § 177.2(b)(7), the Importer’s request for confidentiality is approved. The information contained within brackets in the internal advice decision will not be released to the public and will be withheld from the published version of this decision. FACTS: The merchandise at issue consists of three (3) products identified as: (1) Chlortetracycline Hydrochloride (“CTC-HCI”); (2) Chlortetracycline Feed Grade Concentrate (“CTC-FG”); and (3) Neomycin Sulfate. These products are intended for use in treating various animal diseases and infections. The requestor describes the products as follows: Chlortetracycline Hydrochloride (CTC-HCI) Chlortetracycline Hydrochloride (“CTC-HCI”) is a broad-spectrum substance for use in the manufacture of veterinary drug products, namely Veterinary Feed Directive (“VFD”) Type A medicated articles and Oral Dosage forms such as Pharmgate’s Pennchlor 64 product. Chlortetracycline Hydrochloride is a yellow powder. It is soluble in water and in alcohol. It dissolves in solutions of alkali hydroxides and carbonates. It is a tetracycline group antimicrobian. CTC-HCI contains up to 90% of Chlortetracycline Hydrochloride as an active ingredient; up to 6% of [***] as a minor component; up to 6% of related substances; up to 2% of water; and up to 0.5% of ethanol as a residual solvent. It has the generic name of chlortetracycline hydrochloride. The manufacturing process consists of fermentation for [***] hours and a recovery process. Chlortetracycline is produced through fermentation, the culturing of the streptomyces aureofaciens microorganism. The strain of the microorganism goes through continual screening to select a strain with the highest chlortetracycline production. It is shipped in 25kg bulk containers. Following importation, CTC-HCI is used to manufacture Pharmgate’s Pennchlor 64 product. The Pennchlor 64 retail labeling states the following: “Chlortetracycline HCI, Soluble Powder Concentrate; Antibiotic for animal use in drinking water. CAUTION: Federal law restricts medicated feed containing this veterinary feed directive (VFD) drug to use by or on the order of a licensed veterinarian.” Chlortetracycline Feed Grade Concentrate (CTC-FG) Chlortetracycline Feed Grade Concentrate (CTC-FG) is a broad-spectrum substance that is used in the manufacture of veterinary drug products, namely Veterinary Feed Directive (VFD) Type A medicated articles such as Pharmgate’s Pennchlor and Deracin products. It is described as a fine brown powder or granular substance with a characteristic smell. CTC-FG is composed of the active ingredient of Chlortetracycline at 22-24%. It also contains minor components of up to [***] and [***]. Impurities include up to 3% of related drug substances and up to 8% of moisture. Up to 57% of Calcium carbonate is present along with 3% of sugar, 2% fat, and 3% protein. The Deracin 50 Meal retail label states the following: “Deracin 50 Meal Type A Medicated Article; Active drug ingredients: Chlortetracycline as Chlortetracycline Calcium Complex equivalent to 50 grams Chlortetracycline Hydrochloride/lb.; Ingredients: Dried Streptomyces aureofaciens fermentation product in a carrier suitable for incorporation in feed.” The Pennchlor 50 is described as “free-flowing meal feed medication.” The retail label on the Pennchlor 50 product states: “Pennchlor 50 Type A Medicated Article; Active drug ingredients: Chlortetracycline as Chlortetracycline Calcium Complex equivalent to 50 grams Chlortetracycline Hydrochloride/lb.; Ingredients: Chlortetracycline, Calcium Carbonate, Roughage Products and Mineral Oil. Additionally, the retail label reads: “CAUTION: Federal law restricts medicated feed containing this veterinary feed directive (VFD) drug to use by or on the order of a licensed veterinarian.” The manufacturing process of CTC-FG is conducted in two parts: fermentation and recovery. The Chlortetracycline is produced through fermentation and the culturing of the Streptomyces aureofaciens microorganism. The strain of the microorganism then goes through continual screening to select for a strain with the highest Chlortetracycline production. The post-importation finished products, Pharmgate’s Deracin 50, Pennchlor 50, and Pennchlor 64, are manufactured from the imported CTC-FG or CTC-HCI. These products claim to treat a number of diseases. For instance, the product claims to treat chickens from diseases such as infectious synovitis, chronic respiratory disease, and E. coli infections. Turkeys are said to be treated from diseases such as infectious synovitis, hexamitiasis, paratyphoid, and bluecomb. Swine are claimed to be treated from diseases such as jowl abscesses, leptospirosis, bacterial enteritis, porcine proliferative, and enteropathies. Finally, cattle are said to be treated from diseases such as anaplasmosis, bacterial enteritis, and bacterial pneumonia. Neomycin Sulfate Neomycin Sulfate is a sulfate salt of a type of neomycin, which is an antibacterial substance produced by the growth of Streptomyces fradiae Waksman (Fam. Streptomycetaceae), or a mixture of two or more such salts with the main component being neomycin B sulfate. It contains the active ingredients Neomycin B (main component) comprising 80%, Neomycin A (minor component) at 2%, and Neomycin C (minor component) comprising 3% to 15%. The manufacturing process for Neomycin Sulfate begins with classical fermentation, which includes five-steps. The steps are: inoculation, seed fermentation, fermentation, purification, and final preparation. The imported Neomycin Sulfate is said to be a broad-spectrum antibiotic drug substance for use in the manufacture of both Dosage forms and Veterinary Feed Directive (VFD) Type A medicated articles such as Pharmgate’s Neo-Oxy products. According to Pharmgate, these three products, CTC-HCI, CTC-FG, and Neomycin Sulfate, are imported into the United States and formulated into finished products at the Pharmgate manufacturing facilities. The finished products (e.g., Pennchlor, Deracin, Oxytetracycline Neomycin) are said to be sold to licensed feed mills, farmers, and manufacturers of medicated feed articles for use in livestock feeds to treat and control various infections and diseases that occur in livestock animals. Pharmgate claims that these animal feed products are FDA compliant and that the medicated feeds (i.e., finished products Pennchlor, Deracin, Oxytetracycline Neomycin) are prescribed by a veterinarian to treat various illnesses in livestock animals. Pharmgate describes Chlortetracycline and Neomycin as antibiotics produced through fermentation. It claims that both of these drug substances go through extensive purification processes to remove all of the fermentation media and microorganisms, and to form water soluble salts (hydrochloride and sulfate, respectively). The balance of the purified drugs is the drug substance, and the remaining components are minor to include fermentation analog and its sa

Merchandise imported into the United States is classified under the Harmonized Tariff Schedule of the Unites States (“HTSUS”). Tariff classification is governed by the principles set forth in the General Rules of Interpretation (“GRIs”) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied. The HTSUS headings under consideration are as follows:2309 Preparations of kind used in animal feeding:2309.10.00 Dog or cat food, put up for retail sale….* * *2309.90 Other:2309.10.10 Mixed feeds or mixed feed ingredients….* * *2941 Antibiotics* * *2941.30 .00.00 Tetracycline and their derivatives; salts thereof…. * * *2941.90 Other:2941.90.10 Natural….2941.90.10.10 Aminoglycoside antibiotics…. * * *The Legal Notes to Chapter 23, HTSUS, provide, in pertinent part, as follows :Note 1. Heading 2309 includes products of a kind used in animal feeding, not elsewhere specified or included, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material, other than vegetable waste, vegetable residues and byproducts of such processing. Additional U.S. Note 1. The term “mixed feeds and mixed-feed ingredients” in subheading 2309.90.10 embraces products of heading 2309 which are admixtures of grains (or products, including byproducts, obtained in milling grains) with molasses, oilcake, oil-cake meal or feedstuffs, and which consist of not less than 6 percent by weight of grain or grain products.The Legal Notes to Chapter 29, HTSUS, provide, in pertinent part, as follows:Note 1. Except where th