Amends the Internal Revenue Code to allow a business research tax credit (not applicable to grant funds) for minor use clinical research spending.
[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4780 Introduced in House (IH)]
106th CONGRESS
2d Session
H. R. 4780
To amend the Federal Food, Drug, and Cosmetic Act and the Internal
Revenue Code of 1986 with respect to drugs for minor animal species,
and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 28, 2000
Mr. Pickering (for himself, Mr. Hall of Texas, Mr. Combest, Mr.
Stenholm, and Mr. Pombo) introduced the following bill; which was
referred to the Committee on Commerce, and in addition to the Committee
on Ways and Means, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Federal Food, Drug, and Cosmetic Act and the Internal
Revenue Code of 1986 with respect to drugs for minor animal species,
and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Minor Animal Species Health and
Welfare Act of 2000''.
SEC. 2. FINDINGS.
The Congress finds as follows:
(1) There is a severe shortage of approved animal drugs for
use in minor species.
(2) There is a severe shortage of approved drugs for
treating animal diseases and conditions that occur infrequently
or in limited geographic areas.
(3) Because of the small market shares, low-profit margins
involved, and capital investment required, it is generally not
economically feasible for animal drug manufacturers to pursue
approvals for these species, diseases, and conditions.
(4) Because the populations for which such drugs are
intended are small and conditions of animal management may vary
widely, it is often difficult or impossible to design and
conduct studies to establish drug safety and effectiveness
under traditional animal drug approval processes.
(5) It is in the public interest and in the interest of
animal welfare to provide for special procedures to sanction
the lawful use and marketing of animal drugs for minor species
and minor uses that take into account these special
circumstances and that ensure that such drugs do not endanger
the public health.
(6) Exclusive marketing rights and tax credits for clinical
testing expenses have helped encourage the development of
orphan drugs for human use, and comparable incentives will help
encourage the development and sanctioning for lawful marketing
of animal drugs for minor species and minor uses.
SEC. 3. AMENDMENTS AFFECTING THE FOOD AND DRUG ADMINISTRATION.
(a) Definitions.--Section 201 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 321) is amended by adding the following new
subsections at the end:
``(kk) The term `minor species' means animals other than cattle,
horses, swine, chickens, turkeys, dogs, and cats, except that the
Secretary may amend this definition by regulation.
``(ll) The term `minor use' means the use of a drug--
``(1) in a minor species, or
``(2) in an animal species other than a minor species for a
disease or condition that occurs infrequently or in limited
geographic areas, except that the Secretary may amend this
definition by regulation.
``(mm) The term `species with no human food safety concern' means
an animal species, or life stage of an animal species, that is not
customarily used for food for man and does not endanger the public
health.''.
(b) Minor Use Animal Drugs.--Chapter V of the Federal Food, Drug,
and Cosmetic Act is amended by adding at the end the following new
subchapter:
``SUBCHAPTER F--ANIMAL DRUGS FOR MINOR USES
``designation of drugs for minor uses
``Sec. 571. (a) The manufacturer or the sponsor of a drug may
request the Secretary to designate the drug as a drug for a minor use.
A request for designation of a drug shall be made before the submission
of an application under section 512(b) for the drug. If the Secretary
finds that a drug for which a request is submitted under this
subsection is being or will be investigated for a minor use and if an
application for such drug is approved under section 512, the approval
would be for such minor use, the Secretary shall designate the drug as
a drug for such minor use. A request for a designation of a drug under
this subsection shall contain the consent of the applicant to notice
being given by the Secretary under subsection (c) respecting the
designation of the drug.
``(b) A designation of a drug under subsection (a) shall be subject
to the condition that--
``(1) if an application was approved for the drug under
section 512(c), the manufacturer of the drug will notify the
Secretary of any discontinuance of the production of the drug
at least one year before discontinuance; and
``(2) if an application has not been approved for the drug
under section 512(c) and if preclinical investigations or
investigations under section 512(j) are being conducted with
the drug, the manufacturer or sponsor of the drug will notify
the Secretary of any decision to discontinue active pursuit of
approval of an application under section 512(b).
``(c) Notice respecting the designation of a drug under subsection
(a) shall be made available to the public.
``protection for drugs for minor uses
``Sec. 572. (a) Except as provided in subsection (b):
``(1) If the Secretary approves an application filed
pursuant to section 512 for a drug designated under section 571
for minor uses, no active ingredient (including any salt or
ester of the active ingredient) of which has been approved in
any other application under section 512, the Secretary may not
approve or conditionally approve another application submitted
under section 512 or section 573 for such drug for such minor
use for a person who is not the holder of such approved application
until the expiration of ten years from the date of the approval of the
application.
``(2) If the Secretary approves an application filed
pursuant to section 512 for a drug designated under section 571
for minor uses, which includes an active ingredient (including
an ester or salt of the active ingredient) that has been
approved in any other application under section 512, the
Secretary may not approve or conditionally approve another
application submitted under section 512 or section 573 for such
drug for such minor use for a person who is not the holder of
such approved application until the expiration of seven years
from the date of approval of the application.
``(b) If an application filed pursuant to section 512 is approved
for a drug designated under section 571, the Secretary may, during the
ten-year or seven-year period beginning on the date of the application
approval, approve or conditionally approve another application under
section 512 or section 573 for such drug for such minor use for a
person who is not the holder of such approved application if--
``(1) the Secretary finds, after providing the holder
notice and opportunity for the submission of views, that in
such period the holder of the approved application cannot
assure the availability of sufficient quantities of the drug to
meet the needs for which the drug was designated; or
``(2) such holder provides the Secretary in writing the
consent of such holder for the approval or conditional approval
of other applications before the expiration of such ten-year or
seven-year period.
``conditional approval for minor use new animal drugs
``Sec. 573. (a)(1) Except as provided in paragraph (2), any person
may file with the Secretary an application for conditional approval of
a new animal drug for minor use. Such person shall submit to the
Secretary as part of an application--
``(A) reports of investigations which have been made to
show whether or not such drug is safe for use;
``(B) information to show that there is a reasonable
expectation that the drug is effective for its intended use,
such as data from a pilot investigation, data from an
investigation in a related species; data from a single
investigation, data from an investigation using surrogate
endpoints, data based on pharmacokinetic extrapolations, data
from a short-term investigation, or data from the investigation
of closely-related diseases;
``(C) the quantity of drug expected to be manufactured and
distributed on an annual basis;
``(D) a commitment that the applicant will conduct
additional investigations to support approval of an application
under section 512 within the time frame set forth in subsection
(d)(1)(A);
``(E) reasonable data for establishing a conditional dose;
and
``(F) the information required by section 512(b)(1)(B)-(H).
``(2) A person may not file an application under paragraph (1) if
the person has filed a previous application under paragraph (1) for the
same drug and conditions for use that was conditionally approved by the
Secretary under subsection (b).
``(b)(1) Within 180 days after the filing of an application
pursuant to subsection (a), or such additional period as may be agreed
upon by the Secretary and the applicant, the Secretary shall either (A)
issue an order conditionally approving the application if the Secretary
then finds that none of the grounds for denying conditional approval
specified in subsection (c) applies, or (B) give the applicant notice
of an opportunity for an expedited informal hearing on the question
whether such application is conditionally approvable.
``(2) A drug manufactured in a pilot or other small facility may be
used to demonstrate the safety and effectiveness of the drug and to
obtain conditional approval for the drug prior to manufacture of the
drug in a larger facility, unless the Secretary makes a determination
that a full scale production facility is necessary to ensure the safety
or effectiveness of the drug.
``(c)(1) If the Secretary finds, after due notice to the applicant
and giving the applicant an opportunity for an expedited informal
hearing, that--
``(A) the investigations, reports of which are required to
be submitted to the Secretary pursuant to subsection (a), do
not include adequate tests by all methods reasonably applicable
to show whether or not such drug is safe for use under the
conditions prescribed, recommended, or suggested in the
proposed labeling thereof;
``(B) the results of such tests show that such drug is
unsafe for use under such conditions or do not show that such
drug is safe for use under such conditions;
``(C) the methods used in, and the facilities and controls
used for, the manufacture, processing, and packing of such drug
are inadequate to preserve its identity, strength, quality, and
purity;
``(D) upon the basis of the information submitted to the
Secretary as part of the application, or upon the basis of any
other information before the Secretary with respect to such
drug, the Secretary has insufficient information to determine
whether such drug is safe for use under such conditions;
``(E) evaluated on the basis of the information submitted
to the Secretary as part of the application and any other
information before the Secretary with respect to such drug,
there is insufficient information to show that there is a
reasonable expectation that the drug will have the effect it
purports or is represented to have under the conditions of use
prescribed, recommended, or suggested in the proposed labeling
thereof;
``(F) upon the basis of information submitted to the
Secretary as part of the application or any other information
before the Secretary with respect to such drug, any use
prescribed, recommended, or suggested in labeling proposed for
such drug will result in a residue of such drug in excess of a
tolerance found by the Secretary to be safe for such drug;
``(G) based on a fair evaluation of all material facts,
such labeling is false or misleading in any particular; or
``(H) such drug induces cancer when ingested by man or
animal or, after tests which are appropriate for the evaluation
of the safety of such drug, induces cancer in man or animal,
except that the foregoing provisions of this subparagraph shall
not apply with respect to such drug if the Secretary finds
that, under the conditions for use specified in proposed
labeling and reasonably certain to be followed in practice (i)
such drug will not adversely affect the animals for which it is
intended, and (ii) no residue of such drug will be found (by
methods of examination prescribed or approved by the Secretary
by regulations, which regulations shall not be subject to
subsections (c)), in any edible portion of such animals after
slaughter or in any food yielded by or derived from the living
animals; or
``(I) another person has received approval under section
512 for a drug with the same active ingredient or ingredients
and the same conditions of use, and that person is able to
assure the availability of sufficient quantities of the drug to
meet the needs for which the drug is intended;
the Secretary shall issue an order refusing to conditionally approve
the application. If, after such notice and opportunity for hearing, the
Secretary finds that subparagraphs (A) through (I) do not apply, the
Secretary shall issue an order conditionally approving the application.
``(2) In determining whether such drug is safe for use under the
conditions prescribed, recommended, or suggested in the proposed
labeling thereof, the Secretary shall consider, among other relevant
factors, (A) the probable consumption of such drug and of any substance
formed in or on food because of the use of such drug, (B) the
cumulative effect on man or animal of such drug, taking into account
any chemically or pharmacologically related substance, (C) safety
factors which in the opinion of experts, qualified by scientific
training and experience to evaluate the safety of such drugs, are
appropriate for the use of animal experimentation data, and (D) whether
the conditions of use prescribed, recommended, or suggested in the
proposed labeling are reasonably certain to be followed in practice.
Any order issued under this subsection refusing to approve an
application shall state the findings upon which it is based.
``(d)(1) A conditional approval granted by the Secretary under this
section shall be effective for a one-year period. The Secretary shall,
upon request, renew a conditional approval for up to four additional
one-year terms, unless the Secretary by order makes a finding that--
``(A) the applicant is not making appropriate progress
toward meeting approval requirements under section 512, and is
unlikely to be able to fulfill those requirements and obtain an
approval under section 512 before the expiration of the five
year maximum term of the conditional approval;
``(B) excessive quantities of the drug have been produced,
without adequate explanation; or
``(C) another drug with the same active ingredient or
ingredients for the same conditions of use has received
approval under section 512, and the holder of the approved
application is able to assure the availability of sufficient
quantities of the drug to meet the needs for which the drug is
intended.
``(2) If the Secretary does not renew a conditional approval, the
Secretary shall provide due notice and an opportunity for an expedited
informal hearing to the applicant.
``(e)(1) The Secretary shall, after due notice and opportunity for
an expedited informal hearing to the applicant, issue an order
withdrawing conditional approval of an application filed pursuant to
subsection (a) if the Secretary finds--
``(A) that experience or scientific data show that such
drug is unsafe for use under the conditions of use upon the
basis of which the application was conditionally approved;
``(B) that new evidence not contained in such application
or not available to the Secretary until after such application
was conditionally approved, or tests by new methods, or tests
by methods not deemed reasonably applicable when such
application was conditionally approved, evaluated together with
the evidence available to the Secretary when the application
was conditionally approved, shows that such drug is not shown
to be safe for use under the conditions of use upon the basis
of which the application was conditionally approved;
``(C) on the basis of new information before the Secretary
with respect to such drug, evaluated together with the evidence
available to the Secretary when the application was
conditionally approved, that there is not a reasonable
expectation that such drug will have the effect it purports or
is represented to have under the conditions of use prescribed,
recommended, or suggested in the labeling thereof;
``(D) that the application contains any untrue statement of
a material fact; or
``(E) that the applicant has made any changes from the
standpoint of safety or effectiveness beyond the variations
provided for in the application unless the applicant has
supplemented the application by filing with the Secretary
adequate information respecting all such changes and unless
there is in effect a conditional approval of the supplemental
application, which supplemental application shall be treated in
the same manner as the original application.
If the Secretary finds that there is an imminent hazard to the health
of man or of the animals for which such drug is intended, the Secretary
may suspend the conditional approval of such application immediately,
and give the applicant prompt notice of the Secretary's action and
afford the applicant the opportunity for an expedited informal hearing,
but the authority conferred by this sentence to suspend the conditional
approval of an application shall not be delegated below the
Commissioner of Food and Drugs.
``(2) The Secretary may also, after due notice and opportunity for
an expedited informal hearing to the applicant, issue an order
withdrawing the conditional approval of an application with respect to
any new animal drug under this section if the Secretary finds--
``(A) that the applicant has failed to establish a system
for maintaining required records, or has repeatedly or
deliberately failed to maintain such records or to make
required reports in accordance with a regulation or order under
subsection (h), or the applicant has refused to permit access
to, or copying or verification of, such records as required by
paragraph (2) of such subsection;
``(B) that on the basis of new information before the
Secretary, evaluated together with the evidence before the
Secretary when the application was conditionally approved, the
methods used in, or the facilities and controls used for, the
manufacture, processing, and packing of such drug are
inadequate to assure and preserve its identity, strength,
quality, and purity and were not made adequate within a
reasonable time after receipt of written notice from the
Secretary specifying the matter complained of; or
``(C) that on the basis of new information before the
Secretary, evaluated together with the evidence before the
Secretary when the application was conditionally approved, the
labeling of such drug, based on a fair evaluation of all
material facts, is false or misleading in any particular and
was not corrected within a reasonable time after receipt of
written notice from the Secretary specifying the matter
complained of.
``(3) Any order under this subsection shall state the findings upon
which it is based.
``(f) The decision of the Secretary under subsections (c), (d), or
(e) shall constitute a final agency decision for purposes of judicial
review.
``(g) When an application filed pursuant to subsection (a) is
conditionally approved, the Secretary shall by notice publish in the
Federal Register the name and address of the applicant and the
conditions and indications of use of the new animal drug covered by
such application, including any tolerance and withdrawal period or
other use restriction and, if such new animal drug is intended for use
in animal feed, appropriate purposes and conditions of use (including
special labeling requirements and any requirement that an animal feed
bearing or containing the new animal drug be limited to use under the
professional supervision of a licensed veterinarian) applicable to any
animal feed for use in which such drug is conditionally approved, the
expiration date of the conditional approval, and such other
information, upon the basis of which such application was conditionally
approved, as the Secretary deems necessary to assure the safe and
effective use of such drug. Upon withdrawal of conditional approval of
such new animal drug application or upon its suspension, the Secretary
shall publish a notice in the Federal Register.
``(h)(1) In the case of any new animal drug for which a conditional
approval of an application filed pursuant to subsection (a) is in
effect, the applicant shall establish and maintain such records, and
make such reports to the Secretary, of data relating to experience, and
other data or information, received or otherwise obtained by such
applicant with respect to such drug, or with respect to animal feeds
bearing or containing such drug, as the Secretary may by general
regulation, or by order with respect to such application, prescribe on
the basis of a finding that such records and reports are necessary in
order to enable the Secretary to determine, or facilitate a
determination, whether there is or may be ground for refusing to renew
the conditional approval under subsection (d) or for invoking
subsection (e). Such regulation or order shall provide, where the
Secretary deems it to be appropriate, for the examination, upon
request, by the persons to whom such regulation or order is applicable,
of similar information received or otherwise obtained by the Secretary.
``(2) Every person required under this subsection to maintain
records, and every person in charge or custody thereof, shall, upon
request of an officer or employee designated by the Secretary, permit
such officer or employee at all reasonable times to have access to and
copy and verify such records.
``(i)(1) The label and labeling of a drug with a conditional
approval under this section shall state that fact prominently and
conspicuously.
``(2) Conditions of use that are the subject of an conditional
approval under this section shall not be combined in product labeling
with any conditions of use approved under section 512.
``(j)(1) Safety and effectiveness data and information which has
been submitted in an application filed under subsection (a) for a drug
and which has not previously been disclosed to the public shall be made
available to the public, upon request, unless extraordinary
circumstances are shown--
``(A) if no work is being or will be undertaken to have the
application conditionally approved,
``(B) if the Secretary has determined that the application
is not conditionally approvable and all legal appeals have been
exhausted,
``(C) if conditional approval of the application under
subsection (c) is withdrawn and all legal appeals have been
exhausted, or
``(D) if the Secretary has determined that such drug is not
a new animal drug.
``(2) Any request for data and information pursuant to paragraph
(1) shall include a verified statement by the person making the request
that any data or information received under such paragraph shall not be
disclosed by such person to any other person--
``(A) for the purpose of, or as part of a plan, scheme, or
device for, obtaining the right to make, use, or market, or
making, using, or marketing, outside the United States, the
drug identified in the application filed under subsection (a),
and
``(B) without obtaining from any person to whom the data
and information are disclosed an identical verified statement,
a copy of which is to be provided by such person to the
Secretary, which meets the requirements of this paragraph.
``(k) To the extent consistent with the public health, the
Secretary shall promulgate regulations for exempting from the operation
of this section new animal drugs, and animal feeds bearing or
containing new animal drugs, intended solely for investigational use by
experts qualified by scientific training and experience to investigate
the safety and effectiveness of animal drugs. Such regulations may, in
the discretion of the Secretary, among other conditions relating to the
protection of the public health, provide for conditioning such
exemption upon the establishment and maintenance of such records, and
the making of such reports to the Secretary, by the manufacturer or the
sponsor of the investigation of such article, of data (including but
not limited to analytical reports by investigators) obtained as a
result of such investigational use of such article, as the Secretary
finds will enable the Secretary to evaluate the safety and
effectiveness of such article in the event of the filing of an
application pursuant to this section. Such regulations, among other
things, shall set forth the conditions (if any) upon which animals
treated with such articles, and any products of such animals (before or
after slaughter), may be marketed for food use.
``index of legally marketed unapproved minor use animal drugs for minor
species with no human food safety concern
``Sec. 574. (a) The Secretary shall establish an index of
unapproved minor use new animal drugs that may be lawfully marketed for
use in minor species with no human food safety concern. The index is
intended to benefit primarily zoo and wildlife species, aquarium and
bait fish, reptiles and amphibians, caged birds, and small pet mammals
as well as some commercially produced species such as cricket,
earthworms and possibly nonfood life stages of some minor species used
for human food such as oysters and shellfish. The index shall conform
to the requirements in subsection (d).
``(b)(1) Any person may submit a request to the Secretary for a
preliminary determination that a drug may be eligible for inclusion in
the index. Such a request shall include--
``(A) information regarding the proposed species,
conditions of use, and anticipated annual production;
``(B) information regarding product formulation and
manufacturing; and
``(C) information sufficient for the Secretary to determine
that there does not appear to be human food safety,
environmental safety, occupational safety, or bioavailability
concerns with the proposed use of the drug.
``(2) Within 90 days after the submission of a request for a
preliminary determination under paragraph (1), the Secretary shall
grant or deny the request, and notify the submitter of the Secretary's
conclusion. The Secretary shall grant the request if it appears that--
``(A) the request addresses the need for a minor use animal
drug for which there is no approved or conditionally approved
drug, and
``(B) the proposed drug use does not appear to raise human
food safety, environmental safety, occupational safety, or
bioavailability concerns.
If the Secretary denies the request, the Secretary shall provide due
notice and an opportunity for an expedited informal hearing. If the
Secretary does not grant or deny the request within 90 days, the
Secretary shall provide the Committee on Commerce of the House of
Representatives and the Committee on Health, Education, Labor, and
Pensions of the Senate with the reasons action on the request did not
occur within such 90 days. The decision of the Secretary under this
paragraph shall constitute a final agency decision for purposes of
judicial review.
``(c)(1) With respect to a drug for which the Secretary has made a
preliminary determination of eligibility under subsection (b), the
submitter of that request may request that the Secretary add the drug
to the index established by subsection (a). Such a request shall
include--
``(A) a copy of the Secretary's preliminary determination
of eligibility issued under subsection (b);
``(B) a qualified expert panel report that meets the
requirements in paragraph (2);
``(C) a proposed index entry;
``(D) proposed labeling;
``(E) anticipated annual production of the drug; and
``(F) a commitment to manufacture, label, and distribute
the drug in accordance with the index entry and any additional
requirements that the Secretary may prescribe by general
regulation or specific order.
``(2) For purposes of paragraph (1), a `qualified expert panel
report' is a written report that--
``(A) is authored by a panel of individuals qualified by
scientific training and experience to evaluate the safety and
effectiveness of animal drugs for the intended uses and species
in question and operating external to the Food and Drug
Administration;
``(B) addresses all available target animal safety and
effectiveness information, including anecdotal information
where necessary;
``(C) addresses proposed labeling;
``(D) addresses whether the drug should be limited to use
under the professional supervision of a licensed veterinarian;
and
``(E) addresses whether, in the expert panel's opinion, the
benefits of using the drug outweigh its risks, taking into
account the harm being caused by the absence of an approved or
conditionally approved new animal drug for the minor use in
question.
``(3) Within 180 days after the receipt of a request for listing a
drug in the index, the Secretary shall grant or deny the request. The
Secretary shall grant the request if the Secretary finds, on the basis
of the expert panel report and other information available to the
Secretary, that the benefits of using the drug outweigh its risks,
taking into account the harm caused by the absence of an approved or
conditionally approved new animal drug for the minor use in question.
If the Secretary denies the request, the Secretary shall provide due
notice and the opportunity for an expedited informal hearing. If the
Secretary does not grant or deny the request within 180 days, the
Secretary shall provide the Committee on Commerce of the House of
Representatives and the Committee on Health, Education, Labor, and
Pensions of the Senate with the reasons action on the request did not
occur within such 180 days. The decision of the Secretary under this
paragraph shall constitute a final agency decision for purposes of
judicial review.
``(d)(1) The index established by subsection (a) shall include the
following information for each listed drug:
``(A) The name and address of the sponsor of the index
listing.
``(B) The name of the drug, its dosage form, and its
strength.
``(C) Labeling.
``(D) Production limits or other conditions the Secretary
deems necessary to prevent misuse of the drug.
``(E) Requirements that the Secretary deems necessary for
the safe and effective use of the drug.
``(2) The Secretary shall publish the index, and revise it monthly.
``(e)(1) If the Secretary finds, after due notice to the sponsor
and an opportunity for an expedited informal hearing, that--
``(A) on the basis of new information before the Secretary,
evaluated together with the evidence available to the Secretary
when the drug was listed in the index, the benefits of using
the drug do not outweigh its risks; or
``(B) the conditions and limitations of use in the index
listing have not been followed, the Secretary shall remove the
drug from the index. The decision of the Secretary shall constitute
final agency decision for purposes of judicial review.
``(2) If the Secretary finds that there is an imminent hazard to
the health of man or of the animals for which such drug is intended,
the Secretary may suspend the listing of such drug immediately, and
give the sponsor prompt notice of the Secretary's action and afford the
sponsor the opportunity for an expedited informal hearing, but the
authority conferred by this sentence to suspend the listing of a drug
shall not be delegated below the Commissioner of Food and Drugs.
``(f)(1) In the case of any new animal drug for which an index
listing pursuant to subsection (a) is in effect, the sponsor shall
establish and maintain such records, and make such reports to the
Secretary, of data relating to experience, and other data or
information, received or otherwise obtained by such sponsor with
respect to such drug, or with respect to animal feeds bearing or
containing such drug, as the Secretary may by general regulation, or by
order with respect to such listing, prescribe on the basis of a finding
that such records and reports are necessary in order to enable the
Secretary to determine, or facilitate a determination, whether there is
or may be ground for invoking subsection (e). Such regulation or order
shall provide, where the Secretary deems it to be appropriate, for the
examination, upon request, by the persons to whom such regulation or
order is applicable, of similar information received or otherwise
obtained by the Secretary.
``(2) Every person required under this subsection to maintain
records, and every person in charge or custody thereof, shall, upon
request of an officer or employee designated by the Secretary, permit
such officer or employee at all reasonable times to have access to and
copy and verify such records.
``(g) The labeling of a drug that is the subject of an index
listing shall state, prominently and conspicuously, that the drug is
legally marketed but not approved.
``(h) The Secretary shall promulgate regulations to implement this
section. Such regulations shall address, among other subjects, the
composition of the expert panel, sponsorship of the expert panel under
the auspices of a recognized professional organization, conflict of
interest criteria for panel members, and the use of advisory committees
convened by the Food and Drug Administration.
``(i) To the extent consistent with the public health, the
Secretary shall promulgate regulations for exempting from the operation
of this section new animal drugs intended solely for investigational
use by experts qualified by scientific training and experience to
investigate the safety and effectiveness of animal drugs. Such
regulations may, in the discretion of the Secretary, among other
conditions relating to the protection of the public health, provide for
conditioning such exemption upon the establishment and maintenance of
such records, and the making of such reports to the Secretary, by the
manufacturer or the sponsor of the investigation of such article, of
data (including but not limited to analytical reports by investigators)
obtained as a result of such investigational use of such article, as
the Secretary finds will enable the Secretary to evaluate the safety
and effectiveness of such article in the event of the filing of a
request for an index listing pursuant to this section. Such
regulations, among other things, shall set forth the conditions (if
any) upon which animals treated with such articles, and any products of
such animals (before or after slaughter), may be marketed for food use.
``grants and contracts for development of animal drugs for minor uses
``Sec. 575. (a) The Secretary may make grants to and enter into
contracts with public and private entities and individuals to assist in
defraying the costs of qualified testing expenses and manufacturing
expenses incurred in connection with the development of drugs for minor
uses.
``(b) For purposes of subsection (a) of this section:
``(1) The term `qualified testing' means--
``(A) clinical testing--
``(i) which is carried out under an
exemption for a drug for minor uses under
section 512(j), 573(k), or 574(i); and
``(ii) which occurs after the date such
drug is designated under section 571 and before
the date on which an application with respect
to such drug is submitted under section 512;
and
``(B) preclinical testing involving a drug for
minor use which occurs after the date such drug is
designated under section 571 and before the date on
which an application with respect to such drug is
submitted under section 512.
``(2) The term `manufacturing expenses' means expenses
incurred in developing processes and procedures intended to
meet current good manufacturing practice requirements which
occur after such drug is designated under section 571 and
before the date on which an application with respect to such
drug is submitted under section 512.
``(c) For grants and contracts under subsection (a), there are
authorized to be appropriated $1,000,000 for fiscal year 2001,
$1,500,000 for fiscal year 2002, and $2,000,000 for fiscal year
2003.''.
(c) Three-Year Exclusivity for Minor Use Approvals.--Section
512(c)(2)(F)(ii), (iii), and (v) of the Federal Food, Drug, and
Cosmetic Act is amended by striking ``(other than bioequivalence or
residue studies)'' and inserting the following: ``(other than
bioequivalence studies or, except in the case of a new animal drug for
minor uses, residue studies)''.
(d) Scope of Review for Minor Use Applications.--Section 512(d) of
the Federal Food, Drug, and Cosmetic Act is amended by adding the
following new paragraph at the end:
``(5) In reviewing a supplement to an approved application that
seeks a minor use approval, the Secretary shall not reconsider
information in the approved application to determine whether it meets
current standards for approval.''.
(e) Presumption of New Animal Drug Status.--Section 709 of the
Federal Food, Drug, and Cosmetic Act is amended by designating the
existing text as subsection (a), and by adding the following new
subsection (b):
``(b) In any action to enforce the requirements of this Act
respecting a drug for minor use that is not the subject of an approval
under section 512, a conditional approval under section 573, or an
index listing under section 574, it shall be presumed that the drug is
a new animal drug.''.
(f) Conforming Amendments.--
(1) Section 512(a)(1) of the Federal Food, Drug, and
Cosmetic Act is amended by striking subparagraphs (A) and (B)
and inserting the following:
``(A) there is in effect an approval of an
application filed pursuant to subsection (b) with
respect to such use or intended use of such drug, and
such drug, its labeling, and such use conform to such
approved application;
``(B) there is in effect a conditional approval of
an application filed pursuant to section 573 with
respect to such use or intended use of such drug, and
such drug, its labeling, and such use conform to such
conditionally approved application; or
``(C) there is in effect an index listing pursuant
to section 574 with respect to such use or intended use
of such drug, and such drug, its labeling, and such use
conform to such index listing.''.
(2) Section 512(a)(4) of the Federal Food, Drug, and
Cosmetic Act is amended by adding after ``if an approval of an
application filed under subsection (b)'' the following: ``or a
conditional approval of an application filed under section
573''.
(3) Section 503(f) of the Federal Food, Drug, and Cosmetic
Act is amended as follows:
(A) In paragraph (1)(A)(ii) by striking ``512'' and
inserting the following: ``512, a conditionally
approved application under subsection (b) of section
573, or an index listing under subsection (a) of
section 574.''.
(B) In paragraph (3) by striking ``section 512''
and inserting the following: ``sections 512, 573, or
574.''.
(4) Section 504(a)(1) of the Federal Food, Drug, and
Cosmetic Act is amended by striking ``512(b)'' and inserting
the following: ``512(b), a conditionally approved application
filed pursuant to section 573, or an index listing pursuant to
section 574.''.
(5) Section 504(a)(2)(B) and (b) of the Federal Food, Drug,
and Cosmetic Act are amended by striking ``512(i)'' and
inserting the following: ``512(i) or section 573(g), or the
index listing pursuant to section 574.''.
(6) Section 403(a) of the Food and Drug Administration
Modernization Act (Public Law 105-115) is amended by adding the
following sentence at the end: ``For purposes of this section,
an approved article includes a new animal drug that is the
subject of a conditional approval or an index listing under
sections 573 and 574 of the Federal Food, Drug, and Cosmetic
Act, respectively.''.
(g) Regulations.--The Secretary of Health and Human Services shall
publish proposed regulations to implement amendments to the Federal
Food, Drug, and Cosmetic Act made by this Act within 6 months of the
date of enactment, and final regulations within 24 months of the date
of enactment.
(h) Office of Minor Use Animal Drug Development.--
(1) The Secretary shall establish within the Food and Drug
Administration, Center of Veterinary Medicine, an Office of
Minor Use Animal Drug Development that reports directly to the
Director of the Center for Veterinary Medicine. This office
shall be responsible for designating minor use animal drugs
under section 571 of the Federal Food, Drug, and Cosmetic Act,
for administering grants and contracts for the development of
animal drugs for minor uses under section 575 of the Federal
Food, Drug, and Cosmetic Act, and for serving as liaison with
any party interested in minor use animal drug development.
(2) For this office, there are authorized to be
appropriated $1,200,000 for each of the fiscal years 2001
through 2003.
SEC. 4. CREDIT FOR CLINICAL TESTING EXPENSES FOR CERTAIN ANIMAL DRUGS
FOR MINOR USES.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 45C the following new section:
``SEC. 45D. CLINICAL TESTING EXPENSES FOR CERTAIN ANIMAL DRUGS FOR
MINOR USES.
``(a) General Rule.--For purposes of section 38, the minor use
animal drug credit determined under this section for the taxable year
is an amount equal to 50 percent of the qualified animal clinical
testing expenses for the taxable year.
``(b) Qualified Animal Clinical Testing Expenses.--For purposes of
this section--
``(1) Qualified animal clinical testing expenses.--
``(A) In general.--Except as otherwise provided in
this paragraph, the term `qualified animal clinical
testing expenses' means the amounts which are paid or
incurred by the taxpayer during the taxable year which
would be described in subsection (b) of section 41 if
such subsection were applied with the modifications set
forth in subparagraph (B).
``(B) Modifications.--For purposes of subparagraph
(A), subsection (b) of section 41 shall be applied--
``(i) by substituting `animal clinical
testing' for `qualified research' each place it
appears in paragraphs (2) and (3) of such
subsection, and
``(ii) by substituting `100 percent' for
`65 percent' in paragraph (3)(A) of such
subsection.
``(C) Exclusion for amounts funded by grants,
etc.--The term `qualified animal clinical testing
expenses' shall not include any amount to the extent
such amount is funded by any grant, contract, or
otherwise by another person (or any governmental
entity).
``(D) Special rule.--For purposes of this
paragraph:
``(i) section 41 shall be deemed to remain
in effect for periods after June 30, 2000; and
``(ii) the trade or business requirement of
section 41(b)(1) shall be deemed to be
satisfied in the case of a taxpayer that owns
animals and that conducts clinical testing on
such animals.
``(2) Animal clinical testing.--
``(A) In general.--The term `animal clinical
testing' means any clinical testing--
``(i) which is carried out under an
exemption for a drug being tested for minor use
under section 512(j), 573(k), or 574(i) of the
Federal Food, Drug, and Cosmetic Act (or
regulations issued under such sections),
``(ii) which occurs--
``(I) after the date such drug is
designated under section 571 of such
Act, and
``(II) before the date on which an
application with respect to such drug
is approved under section 512(c) of
such Act, and
``(iii) which is conducted by or on behalf
of--
``(I) the taxpayer to whom the
designation under such section 571
applies, or
``(II) the owner of the animals
that are the subject of clinical
testing.
``(B) Testing must be for minor use.--Animal
clinical testing shall be taken into account under
subparagraph (A) only to the extent such testing is
related to the use of a drug for the minor use for
which it was designated under section 571 of the
Federal Food, Drug, and Cosmetic Act.
``(c) Coordination With Credit for Increasing Research
Expenditures.--
``(1) In general.--Except as provided in paragraph (2), any
qualified animal clinical testing expenses for a taxable year
to which an election under this section applies shall not be
taken into account for purposes of determining the credit
allowable under section 41 for such taxable year.
``(2) Expenses included in determining base period research
expenses.--Any qualified animal clinical testing expenses for
any taxable year which are qualified research expenses (within
the meaning of section 41(b)) shall be taken into account in
determining base period research expenses for purposes of
applying section 41 to subsequent taxable years.
``(d) Definition and Special Rules.--
``(1) Minor use.--For purposes of this section, the term
`minor use' has the meaning given such term by section 201(ll)
of the Federal Food, Drug, and Cosmetic Act. Determinations
under the preceding sentence with respect to any drug shall be
made on the basis of the facts and circumstances as of the date
such drug is designated under section 571 of the Federal Food,
Drug, and Cosmetic Act.
``(2) Denial of credit for testing conducted by
corporations to which section 936 applies.--No credit shall be
allowed under this section with respect to any animal clinical
testing conducted by a corporation to which an election under
section 936 applies.
``(3) Certain rules made applicable.--Rules similar to the
rules of paragraphs (1) and (2) of section 41(f) shall apply
for purposes of this section.
``(4) Election.--This section shall apply to any taxpayer
for any taxable year only if such taxpayer elects (at such time
and in such manner as the Secretary may by regulations
prescribe) to have this section apply for such taxable year.''.
(b) Conforming Amendments.--
(1) Section 38(b) of such Code is amended--
(A) by striking ``plus'' at end of paragraph (11),
(B) by striking the period at the end of paragraph
(12) and inserting ``, plus'', and
(C) by adding at the end the following new
paragraph:
``(13) the minor use animal drug credit determined under
section 45D(a).''.
(2) Section 280C(b) of such Code is amended--
(A) in paragraph (1), by striking ``section
45C(b)'' and inserting ``section 45C(b) or 45D(b)'',
and
(B) in paragraphs (1) and (2), by striking
``section 45C'' each place it appears and inserting
``section 45C or 45D''.
(c) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of such Code is amended by
inserting after the item relating to section 45C the following new
item:
``Sec. 45D. Clinical testing expenses for
certain animal drugs for minor
uses.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
(e) Regulations.--The Secretary of the Treasury shall publish
proposed regulations to implement amendments to the Internal Revenue
Code of 1986 made by this Act within 6 months after the date of the
enactment of this Act, and final regulations within 24 months after
such date.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Sponsor introductory remarks on measure. (CR E1146-1147)
Referred to the Subcommittee on Health and Environment.
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