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January 8, 2024

WARNING LETTER

Re: CMS # 668552

Dear Mr. Kurian,

From August 16 through September 6, 2023, the Food and Drug Administration (FDA) conducted a remote Foreign Supplier Verification Program (FSVP) inspection of Grace Supply Inc., located at 13740 Pike Rd., Missouri City, TX 77489-1015. We also conducted an inspection from February 13 through 16, 2023. These inspections were conducted to determine compliance with the requirements of section 805 of the Federal Food, Drug and Cosmetic Act (FD&C Act) (21 U.S.C. 384a) and the implementing FSVP regulation in 21 CFR part 1 subpart L.

The FSVP regulation requires that importers perform certain risk-based activities to verify that human and/or animal food they import into the United States has been produced in a manner that meets applicable U.S. food safety standards. You may find information relating to the FSVP regulation and your responsibilities to comply with the regulation through links on FDA’s FSVP web page at https://www.fda.gov/food/food-safety-modernization-act-fsma/fsma-final-rule-foreign-supplier-verification-programs-fsvp-importers-food-humans-and-animals.

During the most recent inspection, we found that you are not in compliance with the requirements of 21 CFR part 1, subpart L for the foods you import except for banana chips imported from (b)(4), located in (b)(4). Because of these significant violations, you are not in compliance with section 805 of the FD&C Act.

At the conclusion of the inspection, our investigator provided you with Form FDA 483a, FSVP Observations. During the inspection, you informed our investigator that you would begin working to correct the deficiencies and stated you needed between six months to one year due to the high number of imported products and foreign suppliers. We are unable to evaluate the adequacy of your response because you have not provided any supporting documentation demonstrating your planned or completed corrective actions. Additionally, we have not received your response to the Form FDA 483a issued on September 16, 2023.

Your significant violations of the FSVP regulation are as follows:

1. You did not develop, maintain, and follow an FSVP as required by section 805 of the FD&C Act and 21 CFR part 1.502(a). Specifically, you did not develop an FSVP for any foods that you import, except for the following foods:

• Extra hot snack mix imported from (b)(4), (b)(4)
• Shredded frozen coconut imported from (b)(4), (b)(4)
• Banana chips imported from (b)(4) and (b)(4), (b)(4)

While you provided FSVP documents for extra hot snack mix imported from (b)(4), located in (b)(4) and shredded frozen coconut from (b)(4), located in (b)(4), these documents do not meet the FSVP requirements, as discussed below.

2. Your hazard analysis for the shredded frozen coconut from (b)(4), located in (b)(4), did not identify and evaluate coconut as a potential chemical hazard (food allergen) to determine whether the hazard requires a control per 21 CFR 1.504(a). A hazard analysis must identify known or reasonably foreseeable hazards for each type of food you import to determine whether there are any hazards requiring a control (21 CFR 1.504(a)). The analysis of the known or reasonably foreseeable hazards in each food must include biological hazards, chemical hazards (including pesticide residues), and physical hazards (21 CFR 1.504(b)(1)). Specifically, coconut is a tree nut and is recognized by FDA as a food allergen. Your hazard analysis for shredded frozen coconut and the hazard analysis provided by your foreign supplier did not identify and evaluate coconut as a potential chemical hazard.

3. You did not meet the requirements to conduct and document (or obtain documentation of) one or more of the supplier verification activities listed in 21 CFR 1.506(e)(1)(i) through (iv) for each foreign supplier before importing the food and periodically thereafter, as required by 21 CFR 1.506(e)(1). Your FSVP for the extra hot snack mix imported from (b)(4), located in (b)(4), documented that you determined “a combination of sampling and testing and review of relevant food safety records is the appropriate verification activity” with a frequency of “quarterly until a history is established and annually thereafter.” However, you did not conduct and document (or obtain documentation of) one or more such supplier verification activities for your foreign supplier. Your FSVP included a copy of a self-assessment audit report for the extra hot snack mix imported from (b)(4), however the audit was conducted at your supplier’s parent company, (b)(4), not your supplier (b)(4). Further, you did not document or provide records of any sampling and testing results. Therefore, you did not conduct and document or obtain documentation of one or more supplier verification activities before importing your extra hot snack mix imported from (b)(4) into the United States, as required per 21 CFR 1.506(e)(1).

4. Your supplier verification activities did not provide adequate assurance that the hazards requiring a control in the foods you import have been significantly minimized or prevented, as required by 21 CFR 1.506(c). Specifically, you determined that for your shredded frozen coconut from (b)(4), there is a hazard, specifically Salmonella, that will be controlled by the foreign supplier. Salmonella is a hazard that results in serious adverse health consequences or death to humans or animals (SAHCODHA).¹ In accordance with 21 CFR 1.506(d)(2), when a hazard in a food will be controlled by the foreign supplier and is one for which there is a reasonable probability that exposure to the hazard will result in serious adverse health consequences or death to humans or animals, you must conduct or obtain documentation of an onsite audit of the foreign supplier before initially importing the food and at least annually thereafter, unless you make an adequate written determination that, instead of such initial and annual onsite auditing, other supplier verification activities listed under 21 CFR 1.506(d)(1)(ii) and/or less frequent onsite auditing are appropriate to provide adequate assurances that the foreign supplier is producing the food in accordance with 21 CFR 1.506(c), based on the determination made under § 1.505.

Based on a review of your FSVP documents for shredded frozen coconut from (b)(4), you did not conduct and document or obtain documentation of an onsite audit of the foreign supplier at least annually after importing the food into the United States. Although you provided documentation of an FDA on-site inspection conducted January 31, 2019, of (b)(4), located in (b)(4), it was not conducted before initially importing the food and at least annually thereafter.

Furthermore, your FSVP did not describe adequate written determination that other supplier verification activities are appropriate to provide adequate assurances that the foreign supplier is producing the food in accordance with 21 CFR 1.506(c). In your FSVP section “8. FOREIGN SUPPLIER VERIFICATION ACTIVITIES” you have determined verification activities to be a combination of sampling and testing and review of relevant food safety. However, a review of your foreign supplier’s hazard analysis has shown that there are inadequate controls by your foreign supplier for the Salmonella hazard. There is no kill step in the manufacturing process for shredded frozen coconut to eliminate potential pathogens that may exist in the raw material (whole coconut). Further there are no records of the supplier having a supply-chain program in place to control the hazard (e.g. requiring a COA of incoming raw material) or a process control to eliminate pathogens. Accordingly, finished product testing every (b)(4) months as described in your FSVP is not an appropriate verification activity for a serious hazard (Salmonella), as required by 21 CFR 1.506(d)(2). Therefore, your FSVP does not describe adequate written determination that other supplier verification activities instead of annual onsite auditing, are appropriate, and does not provide adequate assurance that the Salmonella hazard requiring a control in the shredded frozen coconut you import has been significantly minimized or prevented.

The above violations are not intended to be an all-inclusive list of violations of the FSVP requirements. It is your responsibility to ensure that you are in compliance with section 805 of the FD&C Act and the implementing regulation in 21 CFR part 1 subpart L.

This letter notifies you of our concerns and provides you an opportunity to address them. If you do not adequately address this matter, we may take further action. For instance, we may take action under section 801(a)(3) of the FD&C Act (21 U.S.C. 381(a)(3)) to refuse admission of the food you import which appear to be in violation of section 805. We may place these foods you import into the United States on detention without physical examination (DWPE) when you import the products. You can find DWPE information relating to FSVP in Import Alert #99-41 at: http://www.accessdata.fda.gov/cms_ia/ialist.html. In addition, the importation or offering for importation into the United States of an article of food without the importer having an FSVP that meets the requirements of section 805 of the FD&C Act or the FSVP regulation is prohibited under section 301(zz) of the FD&C Act (21 U.S.C. 331(zz)).

In addition to the above violations, we also have the following comments:

• If you are a importing food from a small foreign supplier as specified in 21 CFR 1.512(a)(2) and you choose to comply with the requirements in this section, you must obtain written assurance that your small foreign supplier meets the criteria before first approving the supplier for an applicable calendar year and thereafter on an annual basis by December 31 of each calendar year, per 21 CFR 1.512(b)(1)(ii). The written declaration you provided for your small foreign supplier of banana chips, (b)(4), located in (b)(4), stated that they should be considered a small foreign supplier, however it was not dated, thus it is not clear if you obtained the written assurance prior to importing from your foreign supplier. Furthermore, it is not clear whether your supplier was approved as a small foreign supplier or per standard requirements. For example, your FSVP for banana chips imported from (b)(4) included documents that are not required for a small foreign supplier, such as additional food safety records including a hazard analysis, completed sections for hazard analysis review and assessment, evaluation of foreign supplier’s performance, and foreign supplier verification activities.
• You must sign and date an FSVP record upon initial completion, as required by 21 CFR 1.512(b)(5)(i)(B) and 21 CFR 1.510(a)(2), respectively. However, we noted that for each section that designated a date and signature in your FSVPs provided for the banana chips from (b)(4) and (b)(4), and the extra hot snack mix from (b)(4), other than the section for supplier approval, the date and signature were missing.

You should respond in writing within fifteen (15) working days from your receipt of this letter. Your response should address the specific things you are doing to correct any violations. You should include in your response documentation and information that would assist us in evaluating your corrections, (e.g., documentation of changes you made, such as a copy of your FSVP, records to demonstrate implementation of your FSVP), and any additional information that you wish to supply relevant to your compliance with the FSVP regulation. If you believe that you are not in violation of the FD&C Act, include your reasoning and any supporting information for our consideration. If you cannot complete all corrections within 15 working days, you should explain the reason for your delay and state when you will correct any remaining violations.

Please send your reply to the Food and Drug Administration, Attention: Ernesto Barba, Compliance Officer, Division of Southwest Imports, 9725 Via de la Amistad, Ste 200, San Diego, CA 92154. If you have any questions regarding this letter, you may contact Compliance Officer Ernesto Barba via email at Ernesto.Barba@fda.hhs.gov. Please reference CMS # 668552 on any documents or records you provide to us and/ or within the subject line of any email correspondence you send to us.

Sincerely,
/S/

Todd Cato
Director
Division of Southwest Imports
One Main Place
1201 Main Street, Suite 7200
Dallas, TX 75202

Cc:
Grace Suppy, Inc.
13740 Pike Rd
Missouri City, TX 77489-1015

_____________________

1 See Guidance for Industry and FDA Staff: Questions and Answers Regarding Mandatory Food Recalls https://www.fda.gov/regulatory-information/search-fda-guidance-documents/guidance-industry-and-fda-staff-questions-and-answers-regarding-mandatory-food-recalls (listing Salmonella in ready-to eat food as an example of food that represents a SAHCODHA risk).