CLA-2 RR:CR:GC 966023 AM
Ms. Joni Post
Gambro Renal Products
10810 W. Collins Ave,
Lakewood, CO 80215
Re: Reconsideration of NY I84690; PrismaSate BK0/3 and PrismaSate BK2/0 dialysate solutions
Dear Ms. Post:
This is in reference to your letter of September 6, 2002, on behalf of Gambro Renal Products, to the Director, National Commodity Specialist Division, requesting reconsideration of New York Ruling Letter (NY) I84690, concerning the classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of PrismaSate BK0/3 and PrismaSate BK2/0 dialysate solutions. Your letter was referred to our office for reply.
FACTS:
The merchandise consists of a clear plastic bag, divided into two separate compartments. The upper compartment contains 250 milliliters (ml) of a sterile electrolyte solution and the lower compartment contains 4750 ml of a sterile buffer solution. Subsequent to entry and prior to actual use, the reconstituted solution is prepared by breaking the frangible pin situated between the two compartments, resulting in the mixing of the two solutions. The reconstituted dialysate is then ready for infusion, via a port on the bottom of the plastic bag, into a dialyser.
A dialyser is a specially created filter used in a larger hemodialysis circuit system that performs hemodialysis on a patient. Hemodialysis is the exchange of certain elements between the blood and a dialysate solution (normally urea and low molecular weight toxins go from the patient's blood to the dialysate while bicarbonate and acetate move from the dialysate into the blood) by virtue of the difference in the rates of their diffusion through a semipermeable membrane. Dorland's Illustrated Medical Dictionary, 28th Ed., p. 458, 748 (W.B. Saunders Co., 1994). Dialysate can only be acquired by prescription.
In hemodialysis, the dialysate solution does not touch the patient, although bicarbonate and acetate from the solution move across the dialyser membrane, into the patient’s blood, and is pumped back into the patient’s body. However, in a procedure called peritoneal dialysis, dialysate consisting of electrolytes in a basic solution, similar to the PrismaSate product, is infused into the patient’s peritoneum through a catheter in the patient's side and, after several hours, the fluid is removed by siphoning. Gravity is used to draw the fluid through the catheter and into the body cavity. The empty bag is then placed on the floor, and the fluid flows out of the body cavity and back into the bag. While in the body cavity, a gradient in the fluid pulls out waste through small blood vessels. Once removed or siphoned from the body cavity this fluid is discarded. This procedure gets its name from the membrane lining the walls of the abdominal cavity and enclosing the viscera called the peritoneum. HQ081132 dated August 5, 1988.
ISSUE:
Whether the PrismaSate BK0/3 and PrismaSate BK2/0 dialysate solutions are classified as medicaments, as parts of medical instruments or as a carbonate compound?
LAW AND ANALYSIS:
Merchandise imported into the U.S. is classified under the 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 that requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and mutatis mutandis, to the GRIs.
Additional U.S. Rule of Interpretation 1(a) states that “a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use.”
In interpreting the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89 80, 54 Fed. Reg. 35127 (August 23, 1989).
The following HTSUS provisions are relevant to the classification of this product:
2836 Carbonates; peroxocarbonates (percarbonates); commercial ammonium carbonate containing ammonium carbamate:
* * * * * * * * * * * *
Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses or in forms or packings for retail sale:
* * * * * * * * * * * *
9018 Instruments and appliances used in medical, surgical, dental or veterinary sciences, including scintigraphic apparatus, other electro-medical apparatus and sight-testing instruments; parts and accessories thereof:
Chapter Note 1(a) to chapter 28 states, in pertinent part, "[E]xcept where the context otherwise requires, the headings of this chapter apply only to: (a) [S]eparate chemical elements and separate chemically defined compounds, whether or not containing impurities, . . . ." The Prismasate solutions are a purposeful mixture of electrolytes and sodium bicarbonate intentionally mixed for better control of acidosis, improved hemodynamic and cardiovascular stability and treatment of renal failure patients with concomitant liver failure. As such, these solutions do not constitute a separate chemically defined carbonate compound per note 1(a), Chapter 28. Therefore, heading 2836, HTSUS, does not describe these dialysate solutions.
Heading 3004, HTSUS, is a principal use provision. See HQs 963197, dated December 11, 2000 and 964673, dated February 4, 2002.
When applying a "principal use" provision, the Court must ascertain the class or kind of goods that are involved and decide whether the subject merchandise is a member of that class. See supra Additional US Rule of Interpretation 1 to the HTSUS. In determining the class or kind of goods, the Court examines factors which may include: (1) the general physical characteristics of the merchandise; (2) the expectation of the ultimate purchasers; (3) the channels of trade in which the merchandise moves; (4) the environment of the sale (e.g. the manner in which the merchandise is advertised and displayed); (5) the usage of the merchandise; (6) the economic practicality of so using the import; and (7) the recognition in the trade of this use. United States v. Carborundum Co., 63 C.C.P.A. 98, 102, 536 F.2d 373, 377, cert. denied, 429 U.S. 979, 50 L. Ed. 2d 587, 97 S. Ct. 490 (1976); see also Lenox Coll., 20 C.I.T., Slip Op. 96-30, at page 5. E. M. Chemicals v. United States, 20 C.I.T. 382, 923 F. Supp. 202 (1996 Ct. Intl. Trade).
You state that PrismaSate dialysate solutions cannot be considered medicaments for therapeutic use put up in dosage forms because the solution does not touch or mix with the patient’s blood or body. Although this statement is technically correct, as the solution remains in one compartment of the dialyser while the patient’s blood is in another, the bicarbonate in the dialysate does diffuse across the dialyser membrane into the patient’s blood thereby treating the acidosis common amongst patients with acute renal failure. Furthermore, the PrismaSate solutions belong to the class of goods known as dialysate solutions. Dialysate solutions used in peritoneal dialysis do enter the patient’s body.
Moreover, the instant merchandise meets all of the Carborundum factors listed above. The characteristics of the merchandise are that of a basic electrolyte solution found in the medical arena. The ultimate purchaser expects the solution to treat acute renal failure by removing urea and other toxins, as well as diffusing sodium bicarbonate, in the patient’s bloodstream during the dialysis process. While many medicinal solutions are infused directly into a vein, the mode of administration of the sodium bicarbonate and the treatment of renal failure through the removal of toxins does not effect the tariff classification. Furthermore, the merchandise can only be obtained by prescription. It is used to treat a known medical condition and is approved for such use. Therefore, dialysate solutions belong to the class or kind of goods described as medicaments for therapeutic use put up in measured doses.
You state that the solution is described by heading 9018, HTSUS, as a part of a hemodialysis circuit system, a medical instrument. A hemodialysis circuit system is a machine consisting of pumps, fittings for tubings, hooks for dialysate and drainage bags and a fitting for the dialyser. “Generally, a part of an article ‘must be an internal, constituent or component part, without which the article to which it is joined could not function.’” Headquarters Ruling Letter 957817, dated December 1, 1995, quoting HQ 951857, dated August 14, 1992. In HQ 957817, we found that an intravenous (I.V.) solution administration set could not be considered a “part” of an I.V. infusion pump classified in heading 9018. The set consisted of tubings and a cassette that fits into an I.V. infusion pump used to regulate the flow of the I.V. fluid. We stated that “[t]he pump’s function is to move liquid from a source bag or bottle to a patient. Although the pumps cannot move liquid without the sets and source bag or bottle with liquid attached, it is our opinion that the pumps are a complete machine.” Similarly, in HQ 085088, dated March 12, 1990, we held that an I.V. administration set made specifically for use with a dialysis circuit system cannot be classified as a part of that machine because “the electrical functioning of a dialysis machine does not depend upon the use of an I.V. Administration Set.”
Here, too, the dialysis circuit system is a complete machine. The dialysate suspends from a hook on the machine. It is not an “internal component” of the electrical functioning of the machine. The dialysate is simply one of the fluids that the machine pumps through the dialyser, blood being the other fluid. Hence, the dialysate is no more a “part” of the machine than is the patient’s blood.
HOLDING:
NY I84690 is affirmed. PrismaSate BK0/3 and PrismaSate BK2/0 dialysate solutions are classified in subheading 3004.90.9170, HTSUS, the provision for “[m]edicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses or in forms or packings for retail sale: [o]ther: [o]ther: [o]ther: [p]reparations primarily affecting the electrolytic, caloric or water balance: [o]ther.”
Sincerely,
Myles B. Harmon, Acting Director
Commercial Rulings Division