Lower Costs, More Cures Act of 2019
This bill establishes and modifies several requirements to address prescription drug prices under Medicare, Medicaid, and other programs.
The bill generally
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 19 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 19
To provide for certain reforms with respect to the Medicare program
under title XVIII of the Social Security Act, the Medicaid program
under title XIX of such Act, the Food and Drug Administration, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
December 9, 2019
Mr. Walden (for himself, Mr. Brady, Ms. Foxx of North Carolina, Mr.
Collins of Georgia, Mr. Burgess, Mr. Nunes, Mr. Walberg, Mr.
Sensenbrenner, Mr. Scalise, Ms. Cheney, Mr. Upton, Mr. Shimkus, Mr.
Latta, Mr. Guthrie, Mrs. Rodgers of Washington, Mr. Olson, Mr.
McKinley, Mr. Kinzinger, Mr. Griffith, Mr. Bilirakis, Mr. Johnson of
Ohio, Mr. Long, Mr. Bucshon, Mr. Flores, Mrs. Brooks of Indiana, Mr.
Mullin, Mr. Hudson, Mr. Carter of Georgia, Mr. Gianforte, Mr. Palmer,
Mr. Cole, Mr. Williams, Mr. Abraham, Mr. Keller, Mr. Rutherford, Mr.
Ferguson, Mr. Kustoff of Tennessee, Mr. Riggleman, Mr. Westerman, Mr.
Graves of Louisiana, Mr. LaMalfa, Mr. Baird, Mr. Huizenga, Mr. Murphy
of North Carolina, Mr. Conaway, Mr. Allen, Mr. Weber of Texas, Mr.
Newhouse, Mr. Babin, Mr. Hagedorn, Mr. Rouzer, Mr. Rice of South
Carolina, Mr. Wilson of South Carolina, Mr. Pence, Mr. Hill of
Arkansas, Mr. Marshall, Mr. Balderson, Mr. Aderholt, Mr. Rodney Davis
of Illinois, Mr. Mitchell, Mr. Crenshaw, Mr. Joyce of Pennsylvania, Mr.
Johnson of South Dakota, Mr. Green of Tennessee, Mrs. Miller, Ms.
Stefanik, Mr. Banks, Mr. Comer, Mr. McCaul, Mr. Diaz-Balart, Mr.
Amodei, Mr. Norman, Mr. David P. Roe of Tennessee, Mr. Budd, Mr. Cook,
Mr. Kevin Hern of Oklahoma, Mr. Chabot, Mr. Steube, Mr. Curtis, Mr.
Grothman, Mr. Steil, Mr. Joyce of Ohio, Mr. Smith of New Jersey, Mr.
Gonzalez of Ohio, Mr. Stauber, Mr. Buchanan, Mr. Smith of Nebraska, Mr.
Arrington, Mr. Marchant, Mrs. Walorski, Mr. Kelly of Pennsylvania, Mr.
Smith of Missouri, Mr. LaHood, Mr. Holding, Mr. Estes, Mr. Reed, Mr.
Schweikert, Mr. Wenstrup, Mrs. Roby, Mr. Reschenthaler, Mr. Hurd of
Texas, Mr. Watkins, Mr. Luetkemeyer, Mr. Turner, Mr. Thompson of
Pennsylvania, Ms. Herrera Beutler, Mr. Guest, Mrs. Hartzler, Mrs.
Wagner, Mr. Waltz, Mr. Wright, and Mr. Gibbs) introduced the following
bill; which was referred to the Committee on Energy and Commerce, and
in addition to the Committees on Ways and Means, and the Judiciary, 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 provide for certain reforms with respect to the Medicare program
under title XVIII of the Social Security Act, the Medicaid program
under title XIX of such Act, the Food and Drug Administration, 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 ``Lower Costs, More Cures Act of
2019''.
SEC. 2. TABLE OF CONTENTS.
The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
TITLE I--MEDICARE PARTS B AND D
Subtitle A--Medicare Part B Provisions
Sec. 101. Improvements to Medicare site-of-service transparency.
Sec. 102. Requiring manufacturers of certain single-dose container or
single-use package drugs payable under part
B of the Medicare program to provide
refunds with respect to discarded amounts
of such drugs.
Sec. 103. Providing for variation in payment for certain drugs covered
under part B of the Medicare program.
Sec. 104. Establishment of maximum add-on payment for drugs and
biologicals.
Sec. 105. Treatment of drug administration services furnished by
certain excepted off-campus outpatient
departments of a provider.
Subtitle B--Drug Price Transparency
Sec. 111. Reporting on explanation for drug price increases.
Sec. 112. Public disclosure of drug discounts.
Sec. 113. Study of pharmaceutical supply chain intermediaries and
merger activity.
Sec. 114. Requiring certain manufacturers to report drug pricing
information with respect to drugs under the
Medicare program.
Sec. 115. Making prescription drug marketing sample information
reported by manufacturers available to
certain individuals and entities.
Sec. 116. Requiring prescription drug plan sponsors to include real-
time benefit information as part of such
sponsor's electronic prescription program
under the Medicare program.
Sec. 117. Sense of Congress regarding the need to expand commercially
available drug pricing comparison
platforms.
Sec. 118. Technical corrections.
Subtitle C--Medicare Part D Benefit Redesign
Sec. 121. Medicare part D benefit redesign.
Subtitle D--Other Medicare Part D Provisions
Sec. 131. Transitional coverage and retroactive Medicare part D
coverage for certain low-income
beneficiaries.
Sec. 132. Allowing the offering of additional prescription drug plans
under Medicare part D.
Sec. 133. Allowing certain enrollees of prescription drugs plans and
MA-PD plans under Medicare program to
spread out cost-sharing under certain
circumstances.
Sec. 134. Establishing a monthly cap on beneficiary incurred costs for
insulin products and supplies under a
prescription drug plan or MA-PD plan.
Sec. 135. Growth rate of Medicare part D out-of-pocket cost threshold.
Subtitle E--MedPAC
Sec. 141. Providing the Medicare Payment Advisory Commission and
Medicaid and CHIP Payment and Access
Commission with access to certain drug
payment information, including certain
rebate information.
TITLE II--MEDICAID
Sec. 201. Sunset of limit on maximum rebate amount for single source
drugs and innovator multiple source drugs.
Sec. 202. Medicaid pharmacy and therapeutics committee improvements.
Sec. 203. GAO report on conflicts of interest in State Medicaid program
drug use review boards and pharmacy and
therapeutics (P&T) committees.
Sec. 204. Ensuring the accuracy of manufacturer price and drug product
information under the Medicaid drug rebate
program.
Sec. 205. Improving transparency and preventing the use of abusive
spread pricing and related practices in
Medicaid.
Sec. 206. T-MSIS drug data analytics reports.
Sec. 207. Risk-sharing value-based payment agreements for covered
outpatient drugs under Medicaid.
Sec. 208. Applying Medicaid drug rebate requirement to drugs provided
as part of outpatient hospital services.
TITLE III--FOOD AND DRUG ADMINISTRATION
Subtitle A--CREATES Act
Sec. 301. Actions for delays of generic drugs and biosimilar biological
products.
Sec. 302. REMS approval process for subsequent filers.
Sec. 303. Rule of construction.
Subtitle B--Pay-for-Delay
Sec. 311. Unlawful agreements.
Sec. 312. Notice and certification of agreements.
Sec. 313. Forfeiture of 180-day exclusivity period.
Sec. 314. Commission litigation authority.
Sec. 315. Statute of limitations.
Subtitle C--BLOCKING Act
Sec. 321. Change conditions of first generic exclusivity to spur access
and competition.
Subtitle D--Purple Book
Sec. 331. Public listing.
Sec. 332. Review and report on types of information to be listed.
Subtitle E--Orange Book
Sec. 341. Orange Book.
Sec. 342. GAO report to Congress.
Subtitle F--Advancing Education on Biosimilars
Sec. 351. Education on biological products.
Subtitle G--Streamlining Transition of Biological Products
Sec. 361. Streamlining the transition of biological products.
Subtitle H--Over-the-Counter Monograph Safety, Innovation, and Reform
Sec. 370. Short title; references in subtitle.
Part 1--OTC Drug Review
Sec. 371. Regulation of certain nonprescription drugs that are marketed
without an approved drug application.
Sec. 372. Misbranding.
Sec. 373. Drugs excluded from the over-the-counter drug review.
Sec. 374. Treatment of Sunscreen Innovation Act.
Sec. 375. Annual update to Congress on appropriate pediatric indication
for certain OTC cough and cold drugs.
Sec. 376. Technical corrections.
Part 2--User Fees
Sec. 381. Short title; finding.
Sec. 382. Fees relating to over-the-counter drugs.
Subtitle I--Other Provisions
Sec. 391. Protecting access to biological products.
Sec. 392. Orphan drug clarification.
Sec. 393. Conditions of use for biosimilar biological products.
Sec. 394. Clarifying the meaning of new chemical entity.
TITLE IV--REVENUE PROVISIONS
Sec. 401. Permanent extension of reduction in medical expense deduction
floor.
Sec. 402. Safe harbor for high deductible health plans without
deductible for insulin.
Sec. 403. Inclusion of certain over-the-counter medical products as
qualified medical expenses.
TITLE V--MISCELLANEOUS
Sec. 501. Payment for biosimilar biological products during initial
period.
Sec. 502. GAO study and report on average sales price.
Sec. 503. Requiring prescription drug plans and MA-PD plans to report
potential fraud, waste, and abuse to the
Secretary of HHS.
Sec. 504. Establishment of pharmacy quality measures under Medicare
part D.
Sec. 505. Improving coordination between the Food and Drug
Administration and the Centers for Medicare
& Medicaid Services.
Sec. 506. Patient consultation in Medicare national and local coverage
determinations in order to mitigate
barriers to inclusion of such perspectives.
Sec. 507. MedPAC report on shifting coverage of certain Medicare part B
drugs to Medicare part D.
Sec. 508. Requirement that direct-to-consumer advertisements for
prescription drugs and biological products
include truthful and non-misleading pricing
information.
Sec. 509. Chief Pharmaceutical Negotiator at the Office of the United
States Trade Representative.
Sec. 510. Waiving Medicare coinsurance for colorectal cancer screening
tests.
TITLE I--MEDICARE PARTS B AND D
Subtitle A--Medicare Part B Provisions
SEC. 101. IMPROVEMENTS TO MEDICARE SITE-OF-SERVICE TRANSPARENCY.
Section 1834(t) of the Social Security Act (42 U.S.C. 1395m(t)) is
amended--
(1) in paragraph (1)--
(A) in the heading, by striking ``In general'' and
inserting ``Site payment'';
(B) in the matter preceding subparagraph (A)--
(i) by striking ``or to'' and inserting ``,
to'';
(ii) by inserting ``, or to a physician for
services furnished in a physician's office''
after ``surgical center''; and
(iii) by inserting ``(or 2021 with respect
to a physician for services furnished in a
physician's office)'' after ``2018''; and
(C) in subparagraph (A)--
(i) by striking ``and the'' and inserting
``, the''; and
(ii) by inserting ``, and the physician fee
schedule under section 1848 (with respect to
the practice expense component of such payment
amount)'' after ``such section'';
(2) by redesignating paragraphs (2) through (4) as
paragraphs (3) through (5), respectively; and
(3) by inserting after paragraph (1) the following new
paragraph:
``(2) Physician payment.--Beginning in 2021, the Secretary
shall expand the information included on the Internet website
described in paragraph (1) to include--
``(A) the amount paid to a physician under section
1848 for an item or service for the settings described
in paragraph (1); and
``(B) the estimated amount of beneficiary liability
applicable to the item or service.''.
SEC. 102. REQUIRING MANUFACTURERS OF CERTAIN SINGLE-DOSE CONTAINER OR
SINGLE-USE PACKAGE DRUGS PAYABLE UNDER PART B OF THE
MEDICARE PROGRAM TO PROVIDE REFUNDS WITH RESPECT TO
DISCARDED AMOUNTS OF SUCH DRUGS.
Section 1847A of the Social Security Act (42 U.S.C. 1395-3a) is
amended by adding at the end the following new subsection:
``(h) Refund for Certain Discarded Single-Dose Container or Single-
Use Package Drugs.--
``(1) Secretarial provision of information.--
``(A) In general.--For each calendar quarter
beginning on or after July 1, 2021, the Secretary
shall, with respect to a refundable single-dose
container or single-use package drug (as defined in
paragraph (8)), report to each manufacturer (as defined
in subsection (c)(6)(A)) of such refundable single-dose
container or single-use package drug the following for
the calendar quarter:
``(i) Subject to subparagraph (C),
information on the total number of units of the
billing and payment code of such drug, if any,
that were discarded during such quarter, as
determined using a mechanism such as the JW
modifier used as of the date of enactment of
this subsection (or any such successor modifier
that includes such data as determined
appropriate by the Secretary).
``(ii) The refund amount that the
manufacturer is liable for pursuant to
paragraph (3).
``(B) Determination of discarded amounts.--For
purposes of subparagraph (A)(i), with respect to a
refundable single-dose container or single-use package
drug furnished during a quarter, the amount of such
drug that was discarded shall be determined based on
the amount of such drug that was unused and discarded
for each drug on the date of service.
``(C) Exclusion of units of packaged drugs.--The
total number of units of the billing and payment code
of a refundable single-dose container or single-use
package drug of a manufacturer furnished during a
calendar quarter for purposes of subparagraph (A)(i),
and the determination of the estimated total allowed
charges for the drug in the quarter for purposes of
paragraph (3)(A)(ii), shall not include such units that
are packaged into the payment amount for an item or
service and are not separately payable.
``(2) Manufacturer requirement.--For each calendar quarter
beginning on or after July 1, 2021, the manufacturer of a
refundable single-dose container or single-use package drug
shall, for such drug, provide to the Secretary a refund that is
equal to the amount specified in paragraph (3) for such drug
for such quarter.
``(3) Refund amount.--
``(A) In general.--The amount of the refund
specified in this paragraph is, with respect to a
refundable single-dose container or single-use package
drug of a manufacturer assigned to a billing and
payment code for a calendar quarter beginning on or
after July 1, 2021, an amount equal to the estimated
amount (if any) by which--
``(i) the product of--
``(I) the total number of units of
the billing and payment code for such
drug that were discarded during such
quarter (as determined under paragraph
(1)); and
``(II)(aa) in the case of a
refundable single-dose container or
single-use package drug that is a
single source drug or biological, the
amount determined for such drug under
subsection (b)(4); or
``(bb) in the case of a refundable
single-dose container or single-use
package drug that is a biosimilar
biological product, the average sales
price determined under subsection
(b)(8)(A); exceeds
``(ii) an amount equal to the applicable
percentage (as defined in subparagraph (B)) of
the estimated total allowed charges for such
drug during the quarter.
``(B) Applicable percentage defined.--
``(i) In general.--For purposes of
subparagraph (A)(ii), the term `applicable
percentage' means--
``(I) subject to subclause (II), 10
percent; and
``(II) if applicable, in the case
of a refundable single-dose container
or single-use package drug described in
clause (ii), a percentage specified by
the Secretary pursuant to such clause.
``(ii) Treatment of drugs that have unique
circumstances.--In the case of a refundable
single-dose container or single-use package
drug that has unique circumstances involving
similar loss of product as that described in
paragraph (8)(B), the Secretary, through notice
and comment rulemaking, may increase the
applicable percentage otherwise applicable
under clause (i)(I) as determined appropriate
by the Secretary.
``(4) Frequency.--Amounts required to be refunded pursuant
to paragraph (2) shall be paid in regular intervals (as
determined appropriate by the Secretary).
``(5) Refund deposits.--Amounts paid as refunds pursuant to
paragraph (2) shall be deposited into the Federal Supplementary
Medical Insurance Trust Fund established under section 1841.
``(6) Enforcement.--
``(A) Audits.--
``(i) Manufacturer audits.--Each
manufacturer of a refundable single-dose
container or single-use package drug that is
required to provide a refund under this
subsection shall be subject to periodic audit
with respect to such drug and such refunds by
the Secretary.
``(ii) Provider audits.--The Secretary
shall conduct periodic audits of claims
submitted under this part with respect to
refundable single-dose container or single-use
package drugs in accordance with the authority
under section 1833(e) to ensure compliance with
the requirements applicable under this
subsection.
``(B) Civil money penalty.--
``(i) In general.--The Secretary shall
impose a civil money penalty on a manufacturer
of a refundable single-dose container or
single-use package drug who has failed to
comply with the requirement under paragraph (2)
for such drug for a calendar quarter in an
amount equal to the sum of--
``(I) the amount that the
manufacturer would have paid under such
paragraph with respect to such drug for
such quarter; and
``(II) 25 percent of such amount.
``(ii) Application.--The provisions of
section 1128A (other than subsections (a) and
(b)) shall apply to a civil money penalty under
this subparagraph in the same manner as such
provisions apply to a penalty or proceeding
under section 1128A(a).
``(7) Implementation.--The Secretary shall implement this
subsection through notice and comment rulemaking.
``(8) Definition of refundable single-dose container or
single-use package drug.--
``(A) In general.--Except as provided in
subparagraph (B), in this subsection, the term
`refundable single-dose container or single-use package
drug' means a single source drug or biological (as
defined in section 1847A(c)(6)(D)) or a biosimilar
biological product (as defined in section
1847A(c)(6)(H)) for which payment is established under
this part and that is furnished from a single-dose
container or single-use package.
``(B) Exclusions.--The term `refundable single-dose
container or single-use package drug' does not
include--
``(i) a drug or biological that is either a
radiopharmaceutical or an imaging agent;
``(ii) a drug or biological for which
dosage and administration instructions approved
by the Commissioner of Food and Drugs require
filtration during the drug preparation process,
prior to dilution and administration, and
require that any unused portion of such drug
after the filtration process be discarded after
the completion of such filtration process; or
``(iii) a drug or biological approved by
the Food and Drug Administration on or after
the date of enactment of this subsection and
with respect to which payment has been made
under this part for less than 18 months.''.
SEC. 103. PROVIDING FOR VARIATION IN PAYMENT FOR CERTAIN DRUGS COVERED
UNDER PART B OF THE MEDICARE PROGRAM.
(a) In General.--Section 1847A(b) of the Social Security Act (42
U.S.C. 1395w-3a(b)) is amended--
(1) in paragraph (1)--
(A) in subparagraph (A), by inserting after ``or
106 percent'' the following: ``(or, for a multiple
source drug (other than autologous cellular
immunotherapy) furnished on or after January 1, 2021,
the applicable percent specified in paragraph (9)(A)
for the drug and quarter involved)''; and
(B) in subparagraph (B) of paragraph (1), by
inserting after ``106 percent'' the following: ``(or,
for a single source drug or biological (other than
autologous cellular immunotherapy) furnished on or
after January 1, 2021, the applicable percent specified
in paragraph (9)(A) for the drug or biological and
quarter involved)''; and
(2) by adding at the end the following new paragraph:
``(9) Application of variable percentages based on
percentile ranking of per beneficiary allowed charges.--
``(A) Applicable percent to be applied.--
``(i) In general.--Subject to clauses (ii),
with respect to a drug or biological furnished
in a calendar quarter beginning on or after
January 1, 2021, if the Secretary determines
that the percentile rank of a drug or
biological under subparagraph (B)(i)(III), with
respect to per beneficiary allowed charges for
all such drugs or biologicals, is--
``(I) at least equal to the 85th
percentile, the applicable percent for
the drug for such quarter under this
subparagraph is 104 percent;
``(II) at least equal to the 70th
percentile, but less than the 85th
percentile, such applicable percent is
106 percent;
``(III) at least equal to the 50th
percentile, but less than the 70th
percentile, such applicable percent is
108 percent; or
``(IV) less than the 50th
percentile, such applicable percent is
110 percent.
``(ii) Cases where data not sufficiently
available to compute per beneficiary allowed
charges.--Subject to clause (iii), in the case
of a drug or biological furnished for which the
amount of payment is determined under
subparagraph (A) or (B) of paragraph (1) and
not under subsection (c)(4), for calendar
quarters during a period in which data are not
sufficiently available to compute a per
beneficiary allowed charges for the drug or
biological, the applicable percent is 106
percent.
``(B) Determination of percentile rank of per
beneficiary allowed charges of drugs.--
``(i) In general.--With respect to a
calendar quarter beginning on or after January
1, 2021, for drugs and biologicals for which
the amount of payment is determined under
subparagraph (A) or (B) of paragraph (1),
except for drugs or biologicals for which data
are not sufficiently available, the Secretary
shall--
``(I) compute the per beneficiary
allowed charges (as defined in
subparagraph (C)) for each such drug or
biological;
``(II) adjust such per beneficiary
allowed charges for the quarter, to the
extent provided under subparagraph (D);
and
``(III) array such adjusted per
beneficiary allowed charges for all
such drugs or biologicals from high to
low and rank such drugs or biologicals
by percentile of such arrayed per
beneficiary allowed charges.
``(ii) Frequency.--The Secretary shall make
the computations under clause (i)(I) every 6
months (or, if necessary, as determined by the
Secretary, every 9 or 12 months) and such
computations shall apply to succeeding calendar
quarters until a new computation has been made.
``(iii) Applicable data period.--For
purposes of this paragraph, the term
`applicable data period' means the most recent
period for which the data necessary for making
the computations under clause (i) are
available, as determined by the Secretary.
``(C) Per beneficiary allowed charges defined.--In
this paragraph, the term `per beneficiary allowed
charges' means, with respect to a drug or biological
for which the amount of payment is determined under
subparagraph (A) or (B) of paragraph (1)--
``(i) the allowed charges for the drug or
biological for which payment is so made for the
applicable data period, as estimated by the
Secretary; divided by
``(ii) the number of individuals for whom
any payment for the drug or biological was made
under paragraph (1) for the applicable data
period, as estimated by the Secretary.
``(D) Adjustment to reflect changes in average
sales price.--In applying this paragraph for a
particular calendar quarter, the Secretary shall adjust
the per beneficiary allowed charges for a drug or
biological by multiplying such per beneficiary allowed
charges under subparagraph (C) for the applicable data
period by the ratio of--
``(i) the average sales price for the drug
or biological for the most recent calendar
quarter used under subsection (c)(5)(B); to
``(ii) the average sales price for the drug
or biological for the calendar quarter (or the
weighted average for the quarters involved)
included in the applicable data period.''.
(b) Application of Judicial Review Provisions.--Section 1847A(g) of
the Social Security Act is amended--
(1) by striking ``and'' at the end of paragraph (4);
(2) by striking the period at the end of paragraph (5) and
inserting ``; and''; and
(3) by adding at the end the following new paragraph:
``(6) the determination of per beneficiary allowed charges
of drugs or biologicals and ranking of such charges under
subsection (b)(9).''.
SEC. 104. ESTABLISHMENT OF MAXIMUM ADD-ON PAYMENT FOR DRUGS AND
BIOLOGICALS.
(a) In General.--Section 1847A of the Social Security Act (42
U.S.C. 1395w-3a), as amended by section 103, is further amended--
(1) in subsection (b)--
(A) in paragraph (1), in the matter preceding
subparagraph (A), by striking ``paragraph (7)'' and
inserting ``paragraphs (7) and (10)''; and
(B) by adding at the end the following new
paragraph:
``(10) Maximum add-on payment amount.--
``(A) In general.--In determining the payment
amount under the provisions of subparagraph (A), (B),
or (C) of paragraph (1) of this subsection, subsection
(c)(4)(A)(ii), or subsection (d)(3)(C) for a drug or
biological furnished on or after January 1, 2021, if
the applicable add-on payment (as defined in
subparagraph (B)) for each drug or biological on a
claim for a date of service exceeds the maximum add-on
payment amount specified under subparagraph (C) for the
drug or biological, then the payment amount otherwise
determined for the drug or biological under those
provisions, as applicable, shall be reduced by the
amount of such excess.
``(B) Applicable add-on payment defined.--In this
paragraph, the term `applicable add-on payment' means
the following amounts, determined without regard to the
application of subparagraph (A):
``(i) In the case of a multiple source
drug, an amount equal to the difference
between--
``(I) the amount that would
otherwise be applied under paragraph
(1)(A); and
``(II) the amount that would be
applied under such paragraph if `100
percent' were substituted for the
applicable percent (as defined in
paragraph (9)) for such drug.
``(ii) In the case of a single source drug
or biological, an amount equal to the
difference between--
``(I) the amount that would
otherwise be applied under paragraph
(1)(B); and
``(II) the amount that would be
applied under such paragraph if `100
percent' were substituted for the
applicable percent (as defined in
paragraph (9)) for such drug or
biological.
``(iii) In the case of a biosimilar
biological product, the amount otherwise
determined under paragraph (8)(B).
``(iv) In the case of a drug or biological
during the initial period described in
subsection (c)(4)(A), an amount equal to the
difference between--
``(I) the amount that would
otherwise be applied under subsection
(c)(4)(A)(ii); and
``(II) the amount that would be
applied under such subsection if `100
percent' were substituted, as
applicable, for--
``(aa) `103 percent' in
subclause (I) of such
subsection; or
``(bb) any percent in
excess of 100 percent applied
under subclause (II) of such
subsection.
``(v) In the case of a drug or biological
to which subsection (d)(3)(C) applies, an
amount equal to the difference between--
``(I) the amount that would
otherwise be applied under such
subsection; and
``(II) the amount that would be
applied under such subsection if `100
percent' were substituted, as
applicable, for--
``(aa) any percent in
excess of 100 percent applied
under clause (i) of such
subsection; or
``(bb) `103 percent' in
clause (ii) of such subsection.
``(C) Maximum add-on payment amount specified.--For
purposes of subparagraph (A), the maximum add-on
payment amount specified in this subparagraph is--
``(i) with respect to a drug or biological
(other than autologous cellular
immunotherapy)--
``(I) for each of 2021 through
2028, $1,000; and
``(II) for a subsequent year, the
amount specified in this subparagraph
for the preceding year increased by the
percentage increase in the consumer
price index for all urban consumers
(all items; United States city average)
for the 12-month period ending with
June of the previous year; or
``(ii) with respect to a drug or biological
consisting of autologous cellular
immunotherapy--
``(I) for each of 2021 through
2028, $2,000; and
``(II) for a subsequent year, the
amount specified in this subparagraph
for the preceding year increased by the
percentage increase in the consumer
price index for all urban consumers
(all items; United States city average)
for the 12-month period ending with
June of the previous year.
Any amount determined under this subparagraph that is
not a multiple of $10 shall be rounded to the nearest
multiple of $10.''; and
(2) in subsection (c)(4)(A)(ii), by striking ``in the
case'' and inserting ``subject to subsection (b)(10), in the
case''.
(b) Conforming Amendments Relating to Separately Payable Drugs.--
(1) OPPS.--Section 1833(t)(14) of the Social Security Act
(42 U.S.C. 1395l(t)(14)) is amended--
(A) in subparagraph (A)(iii)(II), by inserting ``,
subject to subparagraph (I)'' after ``are not
available''; and
(B) by adding at the end the following new
subparagraph:
``(I) Application of maximum add-on payment for
separately payable drugs and biologicals.--In
establishing the amount of payment under subparagraph
(A) for a specified covered outpatient drug that is
furnished as part of a covered OPD service (or group of
services) on or after January 1, 2021, if such payment
is determined based on the average price for the year
established under section 1847A pursuant to clause
(iii)(II) of such subparagraph, the provisions of
subsection (b)(10) of section 1847A shall apply to the
amount of payment so established in the same manner as
such provisions apply to the amount of payment under
section 1847A.''.
(2) ASC.--Section 1833(i)(2)(D) of the Social Security Act
(42 U.S.C. 1395l(i)(2)(D)) is amended--
(A) by moving clause (v) 6 ems to the left;
(B) by redesignating clause (vi) as clause (vii);
and
(C) by inserting after clause (v) the following new
clause:
``(vi) If there is a separate payment under
the system described in clause (i) for a drug
or biological furnished on or after January 1,
2021, the provisions of subsection (t)(14)(I)
shall apply to the establishment of the amount
of payment for the drug or biological under
such system in the same manner in which such
provisions apply to the establishment of the
amount of payment under subsection
(t)(14)(A).''.
SEC. 105. TREATMENT OF DRUG ADMINISTRATION SERVICES FURNISHED BY
CERTAIN EXCEPTED OFF-CAMPUS OUTPATIENT DEPARTMENTS OF A
PROVIDER.
Section 1833(t)(16) of the Social Security Act (42 12 U.S.C.
1395l(t)(16)) is amended by adding at the end the following new
subparagraph:
``(G) Special payment rule for drug administration
services furnished by an excepted department of a
provider.--
``(i) In general.--In the case of a covered
OPD service that is a drug administration
service (as defined by the Secretary) furnished
by a department of a provider described in
clause (ii) or (iv) of paragraph (21)(B), the
payment amount for such service furnished on or
after January 1, 2021, shall be the same
payment amount (as determined in paragraph
(21)(C)) that would apply if the drug
administration service was furnished by an off-
campus outpatient department of a provider (as
defined in paragraph (21)(B)).
``(ii) Application without regard to budget
neutrality.--The reductions made under this
subparagraph--
``(I) shall not be considered an
adjustment under paragraph (2)(E); and
``(II) shall not be implemented in
a budget neutral manner.''.
Subtitle B--Drug Price Transparency
SEC. 111. REPORTING ON EXPLANATION FOR DRUG PRICE INCREASES.
(a) In General.--Title III of the Public Health Service Act (42
U.S.C. 241 et seq.) is amended by adding at the end the following:
``PART W--DRUG PRICE REPORTING; DRUG VALUE FUND
``SEC. 399OO. REPORTING ON EXPLANATION FOR DRUG PRICE INCREASES.
``(a) Definitions.--In this section:
``(1) Manufacturer.--The term `manufacturer' means the
person--
``(A) that holds the application for a drug
approved under section 505 of the Federal Food, Drug,
and Cosmetic Act or licensed under section 351 of this
Act; or
``(B) who is responsible for setting the wholesale
acquisition cost for the drug.
``(2) Qualifying drug.--The term `qualifying drug' means
any drug that is approved under subsection (c) or (j) of
section 505 of the Federal Food, Drug, and Cosmetic Act or
licensed under subsection (a) or (k) of section 351 of this
Act--
``(A) that has a wholesale acquisition cost of $100
or more, adjusted for inflation occurring after the
date of enactment of this section, for a month's supply
or a typical course of treatment that lasts less than a
month, and is--
``(i) subject to section 503(b)(1) of the
Federal Food, Drug, and Cosmetic Act;
``(ii) administered or otherwise dispensed
to treat a disease or condition affecting more
than 200,000 persons in the United States; and
``(iii) not a vaccine; and
``(B) for which, during the previous calendar year,
at least 1 dollar of the total amount of sales were for
individuals enrolled under the Medicare program under
title XVIII of the Social Security Act (42 U.S.C. 1395
et seq.) or under a State Medicaid plan under title XIX
of such Act (42 U.S.C. 1396 et seq.) or under a waiver
of such plan.
``(3) Wholesale acquisition cost.--The term `wholesale
acquisition cost' has the meaning given that term in section
1847A(c)(6)(B) of the Social Security Act (42 U.S.C. 1395w-
3a(c)(6)(B)).
``(b) Report.--
``(1) Report required.--The manufacturer of a qualifying
drug shall submit a report to the Secretary--
``(A) for each increase in the price of a
qualifying drug that results in an increase in the
wholesale acquisition cost of that drug that is equal
to--
``(i) 10 percent or more within a single
calendar year beginning on or after January 1,
2019; or
``(ii) 25 percent or more within three
consecutive calendar years for which the first
such calendar year begins on or after January
1, 2019; and
``(B) in the case that the qualifying drug is first
covered under title XVIII with respect to an applicable
year, if the estimated cost or spending under such
title per individual or per user of such drug (as
estimated by the Secretary) for such applicable year
(or per course of treatment in such applicable year, as
defined by the Secretary) is at least $26,000.
``(2) Report deadline.--Each report described in paragraph
(1) shall be submitted to the Secretary--
``(A) in the case of a report with respect to an
increase in the price of a qualifying drug that occurs
during the period beginning on January 1, 2019, and
ending on the day that is 60 days after the date of
enactment of this section, not later than 90 days after
such date of enactment;
``(B) in the case of a report with respect to an
increase in the price of a qualifying drug that occurs
after the period described in subparagraph (A), not
later than 30 days prior to the planned effective date
of such price increase for such qualifying drug; and
``(C) in the case of a report with respect to a
qualifying drug that meets the criteria described in
paragraph (1)(B), not later than 30 days after such
drug meets such criteria.
``(c) Contents.--A report under subsection (b), consistent with the
standard for disclosures described in section 213.3(d) of title 12,
Code of Federal Regulations (as in effect on the date of enactment of
this section), shall, at a minimum, include--
``(1) with respect to the qualifying drug--
``(A) the percentage by which the manufacturer will
raise the wholesale acquisition cost of the drug within
the calendar year or three consecutive calendar years
as described in subsection (b)(1)(A) or (b)(1)(B), if
applicable, and the effective date of such price
increase;
``(B) an explanation for, and description of, each
price increase for such drug that will occur during the
calendar year period described in subsection (b)(1)(A)
or the three consecutive calendar year period described
in subsection (b)(1)(B), as applicable;
``(C) if known and different from the manufacturer
of the qualifying drug, the identity of--
``(i) the sponsor or sponsors of any
investigational new drug applications under
section 505(i) of the Federal Food, Drug, and
Cosmetic Act for clinical investigations with
respect to such drug, for which the full
reports are submitted as part of the
application--
``(I) for approval of the drug
under section 505 of such Act; or
``(II) for licensure of the drug
under section 351 of this Act; and
``(ii) the sponsor of an application for
the drug approved under such section 505 of the
Federal Food, Drug, and Cosmetic Act or
licensed under section 351 of this Act;
``(D) a description of the history of the
manufacturer's price increases for the drug since the
approval of the application for the drug under section
505 of the Federal Food, Drug, and Cosmetic Act or the
issuance of the license for the drug under section 351
of this Act, or since the manufacturer acquired such
approved application or license, if applicable;
``(E) the current wholesale acquisition cost of the
drug;
``(F) the total expenditures of the manufacturer
on--
``(i) materials and manufacturing for such
drug; and
``(ii) acquiring patents and licensing for
such drug;
``(G) the percentage of total expenditures of the
manufacturer on research and development for such drug
that was derived from Federal funds;
``(H) the total expenditures of the manufacturer on
research and development for such drug that is
necessary to demonstrate that it meets applicable
statutory standards for approval under section 505 of
the Federal Food, Drug, and Cosmetic Act or licensure
under section 351 of this Act, as applicable;
``(I) the total expenditures of the manufacturer on
pursuing new or expanded indications or dosage changes
for such drug under section 505 of the Federal Food,
Drug, and Cosmetic Act or section 351 of this Act;
``(J) the total expenditures of the manufacturer on
carrying out postmarket requirements related to such
drug, including under section 505(o)(3) of the Federal
Food, Drug, and Cosmetic Act;
``(K) the total revenue and the net profit
generated from the qualifying drug for each calendar
year since the approval of the application for the drug
under section 505 of the Federal Food, Drug, and
Cosmetic Act or the issuance of the license for the
drug under section 351, or since the manufacturer
acquired such approved application or license; and
``(L) the total costs associated with marketing and
advertising for the qualifying drug;
``(2) with respect to the manufacturer--
``(A) the total revenue and the net profit of the
manufacturer for each of the 1-year period described in
subsection (b)(1)(A) or the 3-year period described in
subsection (b)(1)(B), as applicable;
``(B) all stock-based performance metrics used by
the manufacturer to determine executive compensation
for each of the 1-year period described in subsection
(b)(1)(A) or the 3-year period described in subsection
(b)(1)(B), as applicable; and
``(C) any additional information the manufacturer
chooses to provide related to drug pricing decisions,
such as total expenditures on--
``(i) drug research and development; or
``(ii) clinical trials, including on drugs
that failed to receive approval by the Food and
Drug Administration; and
``(3) such other related information as the Secretary
considers appropriate and as specified by the Secretary through
notice-and-comment rulemaking.
``(d) Information Provided.--The manufacturer of a qualifying drug
that is required to submit a report under subsection (b), shall ensure
that such report and any explanation for, and description of, each
price increase described in subsection (c)(1)(B) shall be truthful, not
misleading, and accurate.
``(e) Civil Monetary Penalty.--Any manufacturer of a qualifying
drug that fails to submit a report for the drug as required by this
section, following notification by the Secretary to the manufacturer
that the manufacturer is not in compliance with this section, shall be
subject to a civil monetary penalty of $75,000 for each day on which
the violation continues.
``(f) False Information.--Any manufacturer that submits a report
for a drug as required by this section that knowingly provides false
information in such report is subject to a civil monetary penalty in an
amount not to exceed $75,000 for each item of false information.
``(g) Public Posting.--
``(1) In general.--Subject to paragraph (3), the Secretary
shall post each report submitted under subsection (b) on the
public website of the Department of Health and Human Services
the day the price increase of a qualifying drug is scheduled to
go into effect.
``(2) Format.--In developing the format in which reports
will be publicly posted under paragraph (1), the Secretary
shall consult with stakeholders, including beneficiary groups,
and shall seek feedback from consumer advocates and readability
experts on the format and presentation of the content of such
reports to ensure that such reports are--
``(A) user-friendly to the public; and
``(B) written in plain language that consumers can
readily understand.
``(3) Protected information.--Nothing in this section shall
be construed to authorize the public disclosure of information
submitted by a manufacturer that is prohibited from disclosure
by applicable laws concerning the protection of trade secrets,
commercial information, and other information covered under
such laws.
``SEC. 399OO-1. ANNUAL REPORT TO CONGRESS.
``(a) In General.--Subject to subsection (b), the Secretary shall
submit to Congress, and post on the public website of the Department of
Health and Human Services in a way that is user-friendly to the public
and written in plain language that consumers can readily understand, an
annual report--
``(1) summarizing the information reported pursuant to
section 399OO;
``(2) including copies of the reports and supporting
detailed economic analyses submitted pursuant to such section;
``(3) detailing the costs and expenditures incurred by the
Department of Health and Human Services in carrying out section
399OO; and
``(4) explaining how the Department of Health and Human
Services is improving consumer and provider information about
drug value and drug price transparency.
``(b) Protected Information.--Nothing in this section shall be
construed to authorize the public disclosure of information submitted
by a manufacturer that is prohibited from disclosure by applicable laws
concerning the protection of trade secrets, commercial information, and
other information covered under such laws.''.
(b) Effective Date.--The amendment made by subsection (a) takes
effect on the date of enactment of this Act.
SEC. 112. PUBLIC DISCLOSURE OF DRUG DISCOUNTS.
Section 1150A of the Social Security Act (42 U.S.C. 1320b-23) is
amended--
(1) in subsection (c), in the matter preceding paragraph
(1), by inserting ``(other than as permitted under subsection
(e))'' after ``disclosed by the Secretary''; and
(2) by adding at the end the following new subsection:
``(e) Public Availability of Certain Information.--
``(1) In general.--In order to allow the comparison of
PBMs' ability to negotiate rebates, discounts, direct and
indirect remuneration fees, administrative fees, and price
concessions and the amount of such rebates, discounts, direct
and indirect remuneration fees, administrative fees, and price
concessions that are passed through to plan sponsors, beginning
January 1, 2020, the Secretary shall make available on the
Internet website of the Department of Health and Human Services
the information with respect to the second preceding calendar
year provided to the Secretary on generic dispensing rates (as
described in paragraph (1) of subsection (b)) and information
provided to the Secretary under paragraphs (2) and (3) of such
subsection that, as determined by the Secretary, is with
respect to each PBM.
``(2) Availability of data.--In carrying out paragraph (1),
the Secretary shall ensure the following:
``(A) Confidentiality.--The information described
in such paragraph is displayed in a manner that
prevents the disclosure of information, with respect to
an individual drug or an individual plan, on rebates,
discounts, direct and indirect remuneration fees,
administrative fees, and price concessions.
``(B) Class of drug.--The information described in
such paragraph is made available by class of drug,
using an existing classification system, but only if
the class contains such number of drugs, as specified
by the Secretary (but not fewer than three drugs), to
ensure confidentiality of proprietary information or
other information that is prevented to be disclosed
under subparagraph (A).''.
SEC. 113. STUDY OF PHARMACEUTICAL SUPPLY CHAIN INTERMEDIARIES AND
MERGER ACTIVITY.
(a) Initial Report.--Not later than 1 year after the date of
enactment of this Act, the Commission shall submit to the appropriate
committees of Congress a report that--
(1) addresses at minimum--
(A) whether pharmacy benefit managers--
(i) charge payers a higher price than the
reimbursement rate at which the pharmacy
benefit managers reimburse competing
pharmacies;
(ii) steer patients for anticompetitive
purposes to any pharmacies, including retail,
mail-order, or any other type of pharmacy, in
which the pharmacy benefit manager has an
ownership interest;
(iii) audit or review proprietary data,
including acquisition costs, patient
information, or dispensing information, of
competing pharmacies that can be used for
anticompetitive purposes; or
(iv) use formulary designs to increase the
market share of higher cost prescription drugs
and depress the market share of lower cost
prescription drugs (each net of rebates and
discounts);
(B) how companies and payers assess the benefits,
costs, and risks of contracting with intermediaries,
including pharmacy services administrative
organizations, and whether more information about the
roles of intermediaries should be available to
consumers and payers; and
(C) whether there are any specific legal or
regulatory obstacles the Commission currently faces in
ensuring a competitive and transparent marketplace in
the pharmaceutical supply chain, including the pharmacy
benefit manager marketplace and pharmacy services
administrative organizations; and
(2) provides--
(A) observations or conclusions drawn from the
November 2017 roundtable entitled ``Understanding
Competition in Prescription Drug Markets: Entry and
Supply Chain Dynamics'', and any similar efforts;
(B) specific actions the Commission intends to take
as a result of the November 2017 roundtable, and any
similar efforts, including a detailed description of
relevant forthcoming actions, additional research or
roundtable discussions, consumer education efforts, or
enforcement actions; and
(C) policy or legislative recommendations to--
(i) improve transparency and competition in
the pharmaceutical supply chain;
(ii) prevent and deter anticompetitive
behavior in the pharmaceutical supply chain;
and
(iii) best ensure that consumers benefit
from any cost savings or efficiencies that may
result from mergers and consolidations.
(b) Interim Report.--Not later than 180 days after the date of
enactment of this Act, the Commission shall submit to the appropriate
committees of Congress an interim report on the progress of the report
required by subsection (a), along with preliminary findings and
conclusions based on information collected to that date.
(c) Definitions.--In this section:
(1) Appropriate committees of congress.--The term
``appropriate committees of Congress'' means--
(A) the Committee on Energy and Commerce of the
House of Representatives;
(B) the Committee on the Judiciary of the Senate;
and
(C) the Committee on the Judiciary of the House of
Representatives.
(2) Commission.--The term ``Commission'' means the Federal
Trade Commission.
SEC. 114. REQUIRING CERTAIN MANUFACTURERS TO REPORT DRUG PRICING
INFORMATION WITH RESPECT TO DRUGS UNDER THE MEDICARE
PROGRAM.
(a) In General.--Section 1847A of the Social Security Act (42
U.S.C. 1395w-3a) is amended--
(1) in subsection (b)--
(A) in paragraph (2)(A), by inserting ``or
subsection (f)(2), as applicable'' before the period at
the end;
(B) in paragraph (3), in the matter preceding
subparagraph (A), by inserting ``or subsection (f)(2),
as applicable,'' before ``determined by''; and
(C) in paragraph (6)(A), in the matter preceding
clause (i), by inserting ``or subsection (f)(2), as
applicable,'' before ``determined by''; and
(2) in subsection (f)--
(A) by striking ``For requirements'' and inserting
the following:
``(1) In general.--For requirements''; and
(B) by adding at the end the following new
paragraph:
``(2) Manufacturers without a rebate agreement under title
xix.--
``(A) In general.--If the manufacturer of a drug or
biological described in subparagraph (C), (E), or (G)
of section 1842(o)(1) or in section 1881(b)(14)(B) that
is payable under this part has not entered into and
does not have in effect a rebate agreement described in
subsection (b) of section 1927, for calendar quarters
beginning on or after January 1, 2020, such
manufacturer shall report to the Secretary the
information described in subsection (b)(3)(A)(iii) of
such section 1927 with respect to such drug or
biological in a time and manner specified by the
Secretary. For purposes of applying this paragraph, a
drug or biological described in the previous sentence
includes items, services, supplies, and products that
are payable under this part as a drug or biological.
``(B) Audit.--Information reported under
subparagraph (A) is subject to audit by the Inspector
General of the Department of Health and Human Services.
``(C) Verification.--The Secretary may survey
wholesalers and manufacturers that directly distribute
drugs described in subparagraph (A), when necessary, to
verify manufacturer prices and manufacturer's average
sales prices (including wholesale acquisition cost) if
required to make payment reported under subparagraph
(A). The Secretary may impose a civil monetary penalty
in an amount not to exceed $100,000 on a wholesaler,
manufacturer, or direct seller, if the wholesaler,
manufacturer, or direct seller of such a drug refuses a
request for information about charges or prices by the
Secretary in connection with a survey under this
subparagraph or knowingly provides false information.
The provisions of section 1128A (other than subsections
(a) (with respect to amounts of penalties or additional
assessments) and (b)) shall apply to a civil money
penalty under this subparagraph in the same manner as
such provisions apply to a penalty or proceeding under
section 1128A(a).
``(D) Confidentiality.--Notwithstanding any other
provision of law, information disclosed by
manufacturers or wholesalers under this paragraph
(other than the wholesale acquisition cost for purposes
of carrying out this section) is confidential and shall
not be disclosed by the Secretary in a form which
discloses the identity of a specific manufacturer or
wholesaler or prices charged for drugs by such
manufacturer or wholesaler, except--
``(i) as the Secretary determines to be
necessary to carry out this section (including
the determination and implementation of the
payment amount), or to carry out section 1847B;
``(ii) to permit the Comptroller General of
the United States to review the information
provided; and
``(iii) to permit the Director of the
Congressional Budget Office to review the
information provided.''.
(b) Enforcement.--Section 1847A of such Act (42 U.S.C. 1395w-3a) is
further amended--
(1) in subsection (d)(4)--
(A) in subparagraph (A), by striking ``In general''
and inserting ``Misrepresentation'';
(B) in subparagraph (B), by striking ``subparagraph
(B)'' and inserting ``subparagraph (A), (B), or (C)'';
(C) by redesignating subparagraph (B) as
subparagraph (D); and
(D) by inserting after subparagraph (A) the
following new subparagraphs:
``(B) Failure to provide timely information.--If
the Secretary determines that a manufacturer described
in subsection (f)(2) has failed to report on
information described in section 1927(b)(3)(A)(iii)
with respect to a drug or biological in accordance with
such subsection, the Secretary shall apply a civil
money penalty in an amount of $10,000 for each day the
manufacturer has failed to report such information and
such amount shall be paid to the Treasury.
``(C) False information.--Any manufacturer required
to submit information under subsection (f)(2) that
knowingly provides false information is subject to a
civil money penalty in an amount not to exceed $100,000
for each item of false information. Such civil money
penalties are in addition to other penalties as may be
prescribed by law.''; and
(2) in subsection (c)(6)(A), by striking the period at the
end and inserting ``, except that, for purposes of subsection
(f)(2), the Secretary may, if the Secretary determines
appropriate, exclude repackagers of a drug or biological from
such term.''.
(c) Manufacturers With a Rebate Agreement.--
(1) In general.--Section 1927(b)(3)(A) of the Social
Security Act (42 U.S.C. 1396r-8(b)(3)(A)) is amended by adding
at the end the following new sentence: ``For purposes of
applying clause (iii), a drug or biological described in the
flush matter following such clause includes items, services,
supplies, and products that are payable under this part as a
drug or biological.''.
(2) Technical amendment.--Section 1927(b)(3)(A)(iii) of the
Social Security Act (42 U.S.C. 1396r-8(b)(3)(A)(iii)) is
amended by striking ``section 1881(b)(13)(A)(ii)'' and
inserting ``section 1881(b)(14)(B)''.
(d) Report.--Not later than January 1, 2021, the Inspector General
of the Department of Health and Human Services shall assess and submit
to Congress a report on the accuracy of average sales price information
submitted by manufacturers under section 1847A of the Social Security
Act (42 U.S.C. 1395w-3a). Such report shall include any recommendations
on how to improve the accuracy of such information.
SEC. 115. MAKING PRESCRIPTION DRUG MARKETING SAMPLE INFORMATION
REPORTED BY MANUFACTURERS AVAILABLE TO CERTAIN
INDIVIDUALS AND ENTITIES.
(a) In General.--Section 1128H of the Social Security Act (42
U.S.C. 1320a-7i) is amended--
(1) by redesignating subsection (b) as subsection (e); and
(2) by inserting after subsection (a) the following new
subsections:
``(b) Data Sharing Agreements.--
``(1) In general.--The Secretary shall enter into
agreements with the specified data sharing individuals and
entities described in paragraph (2) under which--
``(A) upon request of such an individual or entity,
as applicable, the Secretary makes available to such
individual or entity the information submitted under
subsection (a) by manufacturers and authorized
distributors of record; and
``(B) such individual or entity agrees to not
disclose publicly or to another individual or entity
any information that identifies a particular
practitioner or health care facility.
``(2) Specified data sharing individuals and entities.--For
purposes of paragraph (1), the specified data sharing
individuals and entities described in this paragraph are the
following:
``(A) Oversight agencies.--Health oversight
agencies (as defined in section 164.501 of title 45,
Code of Federal Regulations), including the Centers for
Medicare & Medicaid Services, the Office of the
Inspector General of the Department of Health and Human
Services, the Government Accountability Office, the
Congressional Budget Office, the Medicare Payment
Advisory Commission, and the Medicaid and CHIP Payment
and Access Commission.
``(B) Researchers.--Individuals who conduct
scientific research (as defined in section 164.501 of
title 45, Code of Federal Regulations) in relevant
areas as determined by the Secretary.
``(C) Payers.--Private and public health care
payers, including group health plans, health insurance
coverage offered by health insurance issuers, Federal
health programs, and State health programs.
``(3) Exemption from freedom of information act.--Except as
described in paragraph (1), the Secretary may not be compelled
to disclose the information submitted under subsection (a) to
any individual or entity. For purposes of section 552 of title
5, United States Code (commonly referred to as the Freedom of
Information Act), this paragraph shall be considered a statute
described in subsection (b)(3)(B) of such section.
``(c) Penalties.--
``(1) Data sharing agreements.--Subject to paragraph (3),
any specified data sharing individual or entity described in
subsection (b)(2) that violates the terms of a data sharing
agreement the individual or entity has with the Secretary under
subsection (b)(1) shall be subject to a civil money penalty of
not less than $1,000, but not more than $10,000, for each such
violation. Such penalty shall be imposed and collected in the
same manner as civil money penalties under subsection (a) of
section 1128A are imposed and collected under that section.
``(2) Failure to report.--Subject to paragraph (3), any
manufacturer or authorized distributor of record of an
applicable drug under subsection (a) that fails to submit
information required under such subsection in a timely manner
in accordance with rules or regulations promulgated to carry
out such subsection shall be subject to a civil money penalty
of not less than $1,000, but not more than $10,000, for each
such failure. Such penalty shall be imposed and collected in
the same manner as civil money penalties under subsection (a)
of section 1128A are imposed and collected under that section.
``(3) Limitation.--The total amount of civil money
penalties imposed under paragraph (1) or (2) with respect to a
year and an individual or entity described in paragraph (1) or
a manufacturer or distributor described in paragraph (2),
respectively, shall not exceed $150,000.
``(d) Drug Sample Distribution Information.--
``(1) In general.--Not later than January 1 of each year
(beginning with 2021), the Secretary shall maintain a list
containing information related to the distribution of samples
of applicable drugs. Such list shall provide the following
information with respect to the preceding year:
``(A) The name of the manufacturer or authorized
distributor of record of an applicable drug for which
samples were requested or distributed under this
section.
``(B) The quantity and class of drug samples
requested.
``(C) The quantity and class of drug samples
distributed.
``(2) Public availability.--The Secretary shall make the
information in such list available to the public on the
Internet website of the Food and Drug Administration.''.
(b) FDA Maintenance of Information.--The Food and Drug
Administration shall maintain information available to affected
reporting companies to ensure their ability to fully comply with the
requirements of section 1128H of the Social Security Act.
(c) Prohibition on Distribution of Samples of Opioids.--Section
503(d) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 353(d))
is amended--
(1) by moving the margin of paragraph (4) 2 ems to the
left; and
(2) by adding at the end the following:
``(5) No person may distribute a drug sample of a drug that is--
``(A) an applicable drug (as defined in section 1128H(e) of
the Social Security Act);
``(B) a controlled substance (as defined in section 102 of
the Controlled Substances Act) for which the findings required
under section 202(b)(2) of such Act have been made; and
``(C) approved under section 505 for use in the management
or treatment of pain (other than for the management or
treatment of a substance use disorder).''.
(d) MedPAC Report.--Not later than 3 years after the date of the
enactment of this Act, the Medicare Payment Advisory Commission shall
conduct a study on the impact of drug samples on provider prescribing
practices and health care costs and may, as the Commission deems
appropriate, make recommendations on such study.
SEC. 116. REQUIRING PRESCRIPTION DRUG PLAN SPONSORS TO INCLUDE REAL-
TIME BENEFIT INFORMATION AS PART OF SUCH SPONSOR'S
ELECTRONIC PRESCRIPTION PROGRAM UNDER THE MEDICARE
PROGRAM.
Section 1860D-4(e)(2) of the Social Security Act (42 U.S.C. 1395w-
104(e)(2)) is amended--
(1) in subparagraph (D), by striking ``To the extent'' and
inserting ``Except as provided in subparagraph (F), to the
extent''; and
(2) by adding at the end the following new subparagraph:
``(F) Real-time benefit information.--
``(i) In general.--Not later than January
1, 2021, the program shall implement real-time
benefit tools that are capable of integrating
with a prescribing health care professional's
electronic prescribing or electronic health
record system for the transmission of formulary
and benefit information in real time to
prescribing health care professionals. With
respect to a covered part D drug, such tools
shall be capable of transmitting such
information specific to an individual enrolled
in a prescription drug plan. Such information
shall include the following:
``(I) A list of any clinically-
appropriate alternatives to such drug
included in the formulary of such plan.
``(II) Cost-sharing information for
such drug and such alternatives,
including a description of any variance
in cost-sharing based on the pharmacy
dispensing such drug or such
alternatives.
``(III) Information relating to
whether such drug is included in the
formulary of such plan and any prior
authorization or other utilization
management requirements applicable to
such drug and such alternatives so
included.
``(ii) Electronic transmission.--The
provisions of subclauses (I) and (II) of clause
(ii) of subparagraph (E) shall apply to an
electronic transmission described in clause (i)
in the same manner as such provisions apply
with respect to an electronic transmission
described in clause (i) of such subparagraph.
``(iii) Special rule for 2021.--The program
shall be deemed to be in compliance with clause
(i) for 2021 if the program complies with the
provisions of section 423.160(b)(7) of title
42, Code of Federal Regulations (or a successor
regulation), for such year.
``(iv) Rule of construction.--Nothing in
this subparagraph shall be construed as to
allow a real-time benefits tool to steer an
individual, without the consent of the
individual, to a particular pharmacy or
pharmacy setting over their preferred pharmacy
setting nor prohibit the designation of a
preferred pharmacy under such tool.''.
SEC. 117. SENSE OF CONGRESS REGARDING THE NEED TO EXPAND COMMERCIALLY
AVAILABLE DRUG PRICING COMPARISON PLATFORMS.
It is the sense of Congress that--
(1) commercially available drug pricing comparison
platforms can, at no cost, help patients find the lowest price
for their medications at their local pharmacy;
(2) such platforms should be integrated, to the maximum
extent possible, in the health care delivery ecosystem; and
(3) pharmacy benefit managers should work to disclose
generic and brand name drug prices to such platforms to ensure
that--
(A) patients can benefit from the lowest possible
price available to them; and
(B) overall drug prices can be reduced as more
educated purchasing decisions are made based on price
transparency.
SEC. 118. TECHNICAL CORRECTIONS.
(a) In General.--Section 3022(b) of the Public Health Service Act
(42 U.S.C. 300jj-52(b)) is amended by adding at the end the following
new paragraph:
``(4) Application of authorities under inspector general
act of 1978.--In carrying out this subsection, the Inspector
General shall have the same authorities as provided under
section 6 of the Inspector General Act of 1978 (5 U.S.C.
App.).''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect as if included in the enactment of the 21st Century Cures
Act (Public Law 114-255).
Subtitle C--Medicare Part D Benefit Redesign
SEC. 121. MEDICARE PART D BENEFIT REDESIGN.
(a) Benefit Structure Redesign.--Section 1860D-2(b) of the Social
Security Act (42 U.S.C. 1395w- 102(b)) is amended--
(1) in paragraph (2)--
(A) in subparagraph (A)--
(i) in the matter preceding clause (i), by
inserting ``for a year preceding 2022 and for
costs above the annual deductible specified in
paragraph (1) and up to the annual out-of-
pocket threshold specified in paragraph (4)(B)
for 2022 and each subsequent year'' after
``paragraph (3)''; and
(ii) in clause (i), by inserting after ``25
percent'' the following: ``(or, for 2022 and
each subsequent year, 15 percent)'';
(B) in subparagraph (C)--
(i) in clause (i), in the matter preceding
subclause (I), by inserting ``for a year
preceding 2022,'' after ``paragraph (4),''; and
(ii) in clause (ii)(III), by striking ``and
each subsequent year'' and inserting ``and
2021''; and
(C) in subparagraph (D)--
(i) in clause (i)--
(I) in the matter preceding
subclause (I), by inserting ``for a
year preceding 2022,'' after
``paragraph (4),''; and
(II) in subclause (I)(bb), by
striking ``a year after 2018'' and
inserting ``each of years 2018 through
2021''; and
(ii) in clause (ii)(V), by striking ``2019
and each subsequent year'' and inserting ``each
of years 2019 through 2021'';
(2) in paragraph (3)(A)--
(A) in the matter preceding clause (i), by
inserting ``for a year preceding 2022,'' after ``and
(4),''; and
(B) in clause (ii), by striking ``for a subsequent
year'' and inserting ``for each of years 2007 through
2021''; and
(3) in paragraph (4)--
(A) in subparagraph (A)--
(i) in clause (i)--
(I) by redesignating subclauses (I)
and (II) as items (aa) and (bb),
respectively, and indenting
appropriately;
(II) in the matter preceding item
(aa), as redesignated by subclause (I),
by striking ``is equal to the greater
of--'' and inserting ``is equal to--
``(I) for a year preceding 2022,
the greater of--'';
(III) by striking the period at the
end of item (bb), as redesignated by
subclause (I), and inserting ``; and'';
and
(IV) by adding at the end the
following:
``(II) for 2022 and each succeeding
year, $0.''; and
(ii) in clause (ii)--
(I) by striking ``clause (i)(I)''
and inserting ``clause (i)(I)(aa)'';
and
(II) by adding at the end the
following new sentence: ``The Secretary
shall continue to calculate the dollar
amounts specified in clause (i)(I)(aa),
including with the adjustment under
this clause, after 2021 for purposes of
section 1860D-14(a)(1)(D)(iii).'';
(B) in subparagraph (B)--
(i) in clause (i)--
(I) in subclause (V), by striking
``or'' at the end;
(II) in subclause (VI)--
(aa) by striking ``for a
subsequent year'' and inserting
``for 2021''; and
(bb) by striking the period
at the end and inserting a
semicolon; and
(III) by adding at the end the
following new subclauses:
``(VII) for 2022, is equal to
$3,100; or
``(VIII) for a subsequent year, is
equal to the amount specified in this
subparagraph for the previous year,
increased by the annual percentage
increase described in paragraph (6) for
the year involved.''; and
(ii) in clause (ii), by striking ``clause
(i)(II)'' and inserting ``clause (i)'';
(C) in subparagraph (C)(i), by striking ``and for
amounts'' and inserting ``and for a year preceding 2022
for amounts''; and
(D) in subparagraph (E), by striking ``In
applying'' and inserting ``For each of 2011 through
2021, in applying''.
(b) Decreasing Reinsurance Payment Amount.--Section 1860D-15(b)(1)
of the Social Security Act (42 U.S.C. 1395w-115(b)(1)) is amended--
(1) by striking ``equal to 80 percent'' and inserting
``equal to--
``(A) for a year preceding 2022, 80 percent'';
(2) in subparagraph (A), as added by paragraph (1), by
striking the period at the end and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(B) for 2022 and each subsequent year, the sum
of--
``(i) an amount equal to 20 percent of the
allowable reinsurance costs (as specified in
paragraph (2)) attributable to that portion of
gross covered prescription drug costs as
specified in paragraph (3) incurred in the
coverage year after such individual has
incurred costs that exceed the annual out-of-
pocket threshold specified in section 1860D-
2(b)(4)(B) with respect to applicable drugs (as
defined in section 1860D-14B(g)(2)); and
``(ii) an amount equal to 30 percent of the
allowable reinsurance costs (as specified in
paragraph (2)) attributable to that portion of
gross covered prescription drug costs as
specified in paragraph (3) incurred in the
coverage year after such individual has
incurred costs that exceed the annual out-of-
pocket threshold specified in section 1860D-
2(b)(4)(B) with respect to covered part D drugs
that are not applicable drugs (as so
defined).''.
(c) Manufacturer Discount Program.--
(1) In general.--Part D of title XVIII of the Social
Security Act is amended by inserting after section 1860D-14A
(42 U.S.C. 1495w-114) the following new section:
``SEC. 1860D-14B. MANUFACTURER DISCOUNT PROGRAM.
``(a) Establishment.--The Secretary shall establish a manufacturer
discount program (in this section referred to as the `program'). Under
the program, the Secretary shall enter into agreements described in
subsection (b) with manufacturers and provide for the performance of
the duties described in subsection (c). The Secretary shall establish a
model agreement for use under the program by not later than January 1,
2021, in consultation with manufacturers, and allow for comment on such
model agreement.
``(b) Terms of Agreement.--
``(1) In general.--
``(A) Agreement.--An agreement under this section
shall require the manufacturer to provide applicable
beneficiaries access to discounted prices for
applicable drugs of the manufacturer that are dispensed
on or after January 1, 2022.
``(B) Provision of discounted prices at the point-
of-sale.--The discounted prices described in
subparagraph (A) shall be provided to the applicable
beneficiary at the pharmacy or by the mail order
service at the point-of-sale of an applicable drug.
``(2) Provision of appropriate data.--Each manufacturer
with an agreement in effect under this section shall collect
and have available appropriate data, as determined by the
Secretary, to ensure that it can demonstrate to the Secretary
compliance with the requirements under the program.
``(3) Compliance with requirements for administration of
program.--Each manufacturer with an agreement in effect under
this section shall comply with requirements imposed by the
Secretary or a third party with a contract under subsection
(d)(3), as applicable, for purposes of administering the
program, including any determination under subparagraph (A) of
subsection (c)(1) or procedures established under such
subsection (c)(1).
``(4) Length of agreement.--
``(A) In general.--An agreement under this section
shall be effective for an initial period of not less
than 12 months and shall be automatically renewed for a
period of not less than 1 year unless terminated under
subparagraph (B).
``(B) Termination.--
``(i) By the secretary.--The Secretary may
provide for termination of an agreement under
this section for a knowing and willful
violation of the requirements of the agreement
or other good cause shown. Such termination
shall not be effective earlier than 30 days
after the date of notice to the manufacturer of
such termination. The Secretary shall provide,
upon request, a manufacturer with a hearing
concerning such a termination, and such hearing
shall take place prior to the effective date of
the termination with sufficient time for such
effective date to be repealed if the Secretary
determines appropriate.
``(ii) By a manufacturer.--A manufacturer
may terminate an agreement under this section
for any reason. Any such termination shall be
effective, with respect to a plan year--
``(I) if the termination occurs
before January 30 of a plan year, as of
the day after the end of the plan year;
and
``(II) if the termination occurs on
or after January 30 of a plan year, as
of the day after the end of the
succeeding plan year.
``(iii) Effectiveness of termination.--Any
termination under this subparagraph shall not
affect discounts for applicable drugs of the
manufacturer that are due under the agreement
before the effective date of its termination.
``(iv) Notice to third party.--The
Secretary shall provide notice of such
termination to a third party with a contract
under subsection (d)(3) within not less than 30
days before the effective date of such
termination.
``(5) Effective date of agreement.--An agreement under this
section shall take effect on a date determined appropriate by
the Secretary, which may be at the start of a calendar quarter.
``(c) Duties Described.--The duties described in this subsection
are the following:
``(1) Administration of program.--Administering the
program, including--
``(A) the determination of the amount of the
discounted price of an applicable drug of a
manufacturer;
``(B) the establishment of procedures under which
discounted prices are provided to applicable
beneficiaries at pharmacies or by mail order service at
the point-of-sale of an applicable drug;
``(C) the establishment of procedures to ensure
that, not later than the applicable number of calendar
days after the dispensing of an applicable drug by a
pharmacy or mail order service, the pharmacy or mail
order service is reimbursed for an amount equal to the
difference between--
``(i) the negotiated price of the
applicable drug; and
``(ii) the discounted price of the
applicable drug;
``(D) the establishment of procedures to ensure
that the discounted price for an applicable drug under
this section is applied before any coverage or
financial assistance under other health benefit plans
or programs that provide coverage or financial
assistance for the purchase or provision of
prescription drug coverage on behalf of applicable
beneficiaries as the Secretary may specify; and
``(E) providing a reasonable dispute resolution
mechanism to resolve disagreements between
manufacturers, applicable beneficiaries, and the third
party with a contract under subsection (d)(3).
``(2) Monitoring compliance.--
``(A) In general.--The Secretary shall monitor
compliance by a manufacturer with the terms of an
agreement under this section.
``(B) Notification.--If a third party with a
contract under subsection (d)(3) determines that the
manufacturer is not in compliance with such agreement,
the third party shall notify the Secretary of such
noncompliance for appropriate enforcement under
subsection (e).
``(3) Collection of data from prescription drug plans and
ma-pd plans.--The Secretary may collect appropriate data from
prescription drug plans and MA-PD plans in a timeframe that
allows for discounted prices to be provided for applicable
drugs under this section.
``(d) Administration.--
``(1) In general.--Subject to paragraph (2), the Secretary
shall provide for the implementation of this section, including
the performance of the duties described in subsection (c).
``(2) Limitation.--In providing for the implementation of
this section, the Secretary shall not receive or distribute any
funds of a manufacturer under the program.
``(3) Contract with third parties.--The Secretary shall
enter into a contract with 1 or more third parties to
administer the requirements established by the Secretary in
order to carry out this section. At a minimum, the contract
with a third party under the preceding sentence shall require
that the third party--
``(A) receive and transmit information between the
Secretary, manufacturers, and other individuals or
entities the Secretary determines appropriate;
``(B) receive, distribute, or facilitate the
distribution of funds of manufacturers to appropriate
individuals or entities in order to meet the
obligations of manufacturers under agreements under
this section;
``(C) provide adequate and timely information to
manufacturers, consistent with the agreement with the
manufacturer under this section, as necessary for the
manufacturer to fulfill its obligations under this
section; and
``(D) permit manufacturers to conduct periodic
audits, directly or through contracts, of the data and
information used by the third party to determine
discounts for applicable drugs of the manufacturer
under the program.
``(4) Performance requirements.--The Secretary shall
establish performance requirements for a third party with a
contract under paragraph (3) and safeguards to protect the
independence and integrity of the activities carried out by the
third party under the program under this section.
``(5) Administration.--Chapter 35 of title 44, United
States Code, shall not apply to the program under this section.
``(e) Enforcement.--
``(1) Audits.--Each manufacturer with an agreement in
effect under this section shall be subject to periodic audit by
the Secretary.
``(2) Civil money penalty.--
``(A) In general.--The Secretary shall impose a
civil money penalty on a manufacturer that fails to
provide applicable beneficiaries discounts for
applicable drugs of the manufacturer in accordance with
such agreement for each such failure in an amount the
Secretary determines is commensurate with the sum of--
``(i) the amount that the manufacturer
would have paid with respect to such discounts
under the agreement, which will then be used to
pay the discounts which the manufacturer had
failed to provide; and
``(ii) 25 percent of such amount.
``(B) Application.--The provisions of section 1128A
(other than subsections (a) and (b)) shall apply to a
civil money penalty under this paragraph in the same
manner as such provisions apply to a penalty or
proceeding under section 1128A(a).
``(f) Clarification Regarding Availability of Other Covered Part D
Drugs.--Nothing in this section shall prevent an applicable beneficiary
from purchasing a covered part D drug that is not on the formulary of
the prescription drug plan or MA-PD plan that the applicable
beneficiary is enrolled in.
``(g) Definitions.--In this section:
``(1) Applicable beneficiary.--The term `applicable
beneficiary' means an individual who, on the date of dispensing
a covered part D drug--
``(A) is enrolled in a prescription drug plan or an
MA-PD plan;
``(B) is not enrolled in a qualified retiree
prescription drug plan; and
``(C) has incurred costs for covered part D drugs
in the year that are equal to or exceed the annual
deductible specified in section 1860D-2(b)(1) for such
year.
``(2) Applicable drug.--The term `applicable drug' means,
with respect to an applicable beneficiary, a covered part D
drug--
``(A) approved under a new drug application under
section 505(c) of the Federal Food, Drug, and Cosmetic
Act or, in the case of a biologic product, licensed
under section 351 of the Public Health Service Act
(including a product licensed under subsection (k) of
such section); and
``(B)(i) if the PDP sponsor of the prescription
drug plan or the MA organization offering the MA-PD
plan uses a formulary, which is on the formulary of the
prescription drug plan or MA-PD plan that the
applicable beneficiary is enrolled in;
``(ii) if the PDP sponsor of the prescription drug
plan or the MA organization offering the MA-PD plan
does not use a formulary, for which benefits are
available under the prescription drug plan or MA-PD
plan that the applicable beneficiary is enrolled in; or
``(iii) is provided through an exception or appeal.
``(3) Applicable number of calendar days.--The term
`applicable number of calendar days' means--
``(A) with respect to claims for reimbursement
submitted electronically, 14 days; and
``(B) with respect to claims for reimbursement
submitted otherwise, 30 days.
``(4) Discounted price.--
``(A) In general.--The term `discounted price'
means, with respect to an applicable drug of a
manufacturer furnished during a year to an applicable
beneficiary, 90 percent of the negotiated price of such
drug.
``(B) Clarification.--Nothing in this section shall
be construed as affecting the responsibility of an
applicable beneficiary for payment of a dispensing fee
for an applicable drug.
``(C) Special case for claims spanning
deductible.--In the case where the entire amount of the
negotiated price of an individual claim for an
applicable drug with respect to an applicable
beneficiary does not fall at or above the annual
deductible specified in section 1860D-2(b)(1) for the
year, the manufacturer of the applicable drug shall
provide the discounted price under this section on only
the portion of the negotiated price of the applicable
drug that falls at or above such annual deductible.
``(5) Manufacturer.--The term `manufacturer' means any
entity which is engaged in the production, preparation,
propagation, compounding, conversion, or processing of
prescription drug products, either directly or indirectly by
extraction from substances of natural origin, or independently
by means of chemical synthesis, or by a combination of
extraction and chemical synthesis. Such term does not include a
wholesale distributor of drugs or a retail pharmacy licensed
under State law.
``(6) Negotiated price.--The term `negotiated price' has
the meaning given such term in section 1860D-2(d)(1)(B), except
that such negotiated price shall not include any dispensing fee
for an applicable drug.
``(7) Qualified retiree prescription drug plan.--The term
`qualified retiree prescription drug plan' has the meaning
given such term in section 11860D-22(a)(2).''.
(2) Sunset of medicare coverage gap discount program.--
Section 1860D-14A of the Social Security Act (42 U.S.C. 1395-
114a) is amended--
(A) in subsection (a), in the first sentence, by
striking ``The Secretary'' and inserting ``Subject to
subsection (h), the Secretary''; and
(B) by adding at the end the following new
subsection:
``(h) Sunset of Program.--
``(1) In general.--The program shall not apply to
applicable drugs dispensed on or after January 1, 2022, and,
subject to paragraph (2), agreements under this section shall
be terminated as of such date.
``(2) Continued application for applicable drugs dispensed
prior to sunset.--The provisions of this section (including all
responsibilities and duties) shall continue to apply after
January 1, 2022, with respect to applicable drugs dispensed
prior to such date.''.
(3) Inclusion of actuarial value of manufacturer discounts
in bids.--Section 1860D-11 of the Social Security Act (42
U.S.C. 1395w-111) is amended--
(A) in subsection (b)(2)(C)(iii)--
(i) by striking ``assumptions regarding the
reinsurance'' and inserting ``assumptions
regarding--
``(I) the reinsurance''; and
(ii) by adding at the end the following:
``(II) for 2022 and each subsequent
year, the manufacturer discounts
provided under section 1860D- 14B
subtracted from the actuarial value to
produce such bid; and''; and
(B) in subsection (c)(1)(C)--
(i) by striking ``an actuarial valuation of
the reinsurance'' and inserting ``an actuarial
valuation of--
``(i) the reinsurance'';
(ii) in clause (i), as added by clause (i)
of this subparagraph, by adding ``and'' at the
end; and
(iii) by adding at the end the following:
``(ii) for 2022 and each subsequent year,
the manufacturer discounts provided under
section 1860D-14B;''.
(d) Determination of Allowable Reinsurance Costs.--Section 1860D-
15(b) of the Social Security Act (42 U.S.C. 1395w-115(b)) is amended--
(1) in paragraph (2)--
(A) by striking ``Costs.--For purposes'' and
inserting ``Costs.--
``(A) In general.--Subject to subparagraph (B), for
purposes''; and
(B) by adding at the end the following new
subparagraph:
``(B) Inclusion of manufacturer discounts on
applicable drugs.--For purposes of applying
subparagraph (A), the term `allowable reinsurance
costs' shall include the portion of the negotiated
price (as defined in section 1860D-14B(g)(6)) of an
applicable drug (as defined in section 1860D-14(g)(2))
that was paid by a manufacturer under the manufacturer
discount program under section 1860D-14B.''; and
(2) in paragraph (3)--
(A) in the first sentence, by striking ``For
purposes'' and inserting ``Subject to paragraph (2)(B),
for purposes''; and
(B) in the second sentence, by inserting ``or, in
the case of an applicable drug, by a manufacturer''
after ``by the individual or under the plan''.
(e) Updating Risk Adjustment Methodologies To Account for Part D
Modernization Redesign.--Section 1860D-15(c) of the Social Security Act
(42 U.S.C. 1395w-115(c)) is amended by adding at the end the following
new paragraph:
``(3) Updating risk adjustment methodologies to account for
part d modernization redesign.--The Secretary shall update the
risk adjustment model used to adjust bid amounts pursuant to
this subsection as appropriate to take into account changes in
benefits under this part pursuant to the amendments made by
section 121 of the Lower Costs, More Cures Act of 2019.''.
(f) Conditions for Coverage of Drugs Under This Part.--Section
1860D-43 of the Social Security Act (42 U.S.C. 1395w-153) is amended--
(1) in subsection (a)--
(A) in paragraph (2), by striking ``and'' at the
end;
(B) in paragraph (3), by striking the period at the
end and inserting a semicolon; and
(C) by adding at the end the following new
paragraphs:
``(4) participate in the manufacturer discount program
under section 1860D-14B;
``(5) have entered into and have in effect an agreement
described in subsection (b) of such section 1860D-14B with the
Secretary; and
``(6) have entered into and have in effect, under terms and
conditions specified by the Secretary, a contract with a third
party that the Secretary has entered into a contract with under
subsection (d)(3) of such section 1860D-14B.'';
(2) by striking subsection (b) and inserting the following:
``(b) Effective Date.--Paragraphs (1) through (3) of subsection (a)
shall apply to covered part D drugs dispensed under this part on or
after January 1, 2011, and before January 1, 2022, and paragraphs (4)
through (6) of such subsection shall apply to covered part D drugs
dispensed on or after January 1, 2022.''; and
(3) in subsection (c), by striking paragraph (2) and
inserting the following:
``(2) the Secretary determines that in the period beginning
on January 1, 2011, and ending on December 31, 2011 (with
respect to paragraphs (1) through (3) of subsection (a)), or
the period beginning on January 1, 2022, and ending December
31, 2022 (with respect to paragraphs (4) through (6) of such
subsection), there were extenuating circumstances.''.
(g) Conforming Amendments.--
(1) Section 1860D-2 of the Social Security Act (42 U.S.C.
1395w-102) is amended--
(A) in subsection (a)(2)(A)(i)(I), by striking ``,
or an increase in the initial'' and inserting ``or for
a year preceding 2022 an increase in the initial'';
(B) in subsection (c)(1)(C)--
(i) in the subparagraph heading, by
striking ``at initial coverage limit''; and
(ii) by inserting ``for a year preceding
2022 or the annual out-of-pocket threshold
specified in subsection (b)(4)(B) for the year
for 2022 and each subsequent year'' after
``subsection (b)(3) for the year'' each place
it appears; and
(C) in subsection (d)(1)(A), by striking ``or an
initial'' and inserting ``or for a year preceding 2022,
an initial''.
(2) Section 1860D-4(a)(4)(B)(i) of the Social Security Act
(42 U.S.C. 1395w-104(a)(4)(B)(i)) is amended by striking ``the
initial'' and inserting ``for a year preceding 2022, the
initial''.
(3) Section 1860D-14(a) of the Social Security Act (42
U.S.C. 1395w-114(a)) is amended--
(A) in paragraph (1)--
(i) in subparagraph (C), by striking ``The
continuation'' and inserting ``For a year
preceding 2022, the continuation'';
(ii) in subparagraph (D)(iii), by striking
``1860D-2(b)(4)(A)(i)(I)'' and inserting
``1860D-2(b)(4)(A)(i)(I)(aa)''; and
(iii) in subparagraph (E), by striking
``The elimination'' and inserting ``For a year
preceding 2022, the elimination''; and
(B) in paragraph (2)--
(i) in subparagraph (C), by striking ``The
continuation'' and inserting ``For a year
preceding 2022, the continuation''; and
(ii) in subparagraph (E)--
(I) by inserting ``for a year
preceding 2022,'' after ``subsection
(c)''; and
(II) by striking ``1860D-
2(b)(4)(A)(i)(I)'' and inserting
``1860D-2(b)(4)(A)(i)(I)(aa)''.
(4) Section 1860D-21(d)(7) of the Social Security Act (42
U.S.C. 1395w-131(d)(7)) is amended by striking ``section 1860D-
2(b)(4)(B)(i)'' and inserting ``section 1860D-2(b)(4)(C)(i)''.
(5) Section 1860D-22(a)(2)(A) of the Social Security Act
(42 U.S.C. 1395w-132(a)(2)(A)) is amended--
(A) by striking ``the value of any discount'' and
inserting the following: ``the value of--
``(i) for years prior to 2022, any
discount'';
(B) in clause (i), as inserted by subparagraph (A)
of this paragraph, by striking the period at the end
and inserting ``; and''; and
(C) by adding at the end the following new clause:
``(ii) for 2022 and each subsequent year,
any discount provided pursuant to section
1860D-14B.''.
(6) Section 1860D-41(a)(6) of the Social Security Act (42
U.S.C. 1395w-151(a)(6)) is amended--
(A) by inserting ``for a year before 2022'' after
``1860D-2(b)(3)''; and
(B) by inserting ``for such year'' before the
period.
(h) Effective Date.--The amendments made by this section shall
apply to plan year 2022 and subsequent plan years.
Subtitle D--Other Medicare Part D Provisions
SEC. 131. TRANSITIONAL COVERAGE AND RETROACTIVE MEDICARE PART D
COVERAGE FOR CERTAIN LOW-INCOME BENEFICIARIES.
Section 1860D-14 of the Social Security Act (42 U.S.C. 1395w-114)
is amended--
(1) by redesignating subsection (e) as subsection (f); and
(2) by adding after subsection (d) the following new
subsection:
``(e) Limited Income Newly Eligible Transition Program.--
``(1) In general.--Beginning not later than January 1,
2021, the Secretary shall carry out a program to provide
transitional coverage for covered part D drugs for LI NET
eligible individuals in accordance with this subsection.
``(2) LI net eligible individual defined.--For purposes of
this subsection, the term `LI NET eligible individual' means a
part D eligible individual who--
``(A) meets the requirements of clauses (ii) and
(iii) of subsection (a)(3)(A); and
``(B) has not yet enrolled in a prescription drug
plan or an MA-PD plan, or, who has so enrolled, but
with respect to whom coverage under such plan has not
yet taken effect.
``(3) Transitional coverage.--For purposes of this
subsection, the term `transitional coverage' means, with
respect to an LI NET eligible individual--
``(A) immediate access to covered part D drugs at
the point-of-sale during the period that begins on the
first day of the month such individual is determined to
meet the requirements of clauses (ii) and (iii) of
subsection (a)(3)(A) and ends on the date that coverage
under a prescription drug plan or MA-PD plan takes
effect with respect to such individual; and
``(B) in the case of an LI NET eligible individual
who is a full-benefit dual eligible individual (as
defined in section 1935(c)(6)) or a recipient of
supplemental security income benefits under title XVI,
retroactive coverage (in the form of reimbursement of
the amounts that would have been paid under this part
had such individual been enrolled in a prescription
drug plan or MA-PD plan) of covered part D drugs
purchased by such individual during the period that
begins on the date that is the later of--
``(i) the date that such individual was
first eligible for a low-income subsidy under
this part; or
``(ii) the date that is 36 months prior to
the date such individual enrolls in a
prescription drug plan or MA-PD plan, and ends
on the date that coverage under such plan takes
effect.
``(4) Program administration.--
``(A) Single point of contact.--The Secretary
shall, to the extent feasible, administer the program
under this subsection through a contract with a single
program administrator.
``(B) Benefit design.--The Secretary shall ensure
that the transitional coverage provided to LI NET
eligible individuals under this subsection--
``(i) provides access to all covered part D
drugs under an open formulary;
``(ii) permits all pharmacies determined by
the Secretary to be in good standing to process
claims under the program;
``(iii) is consistent with such
requirements as the Secretary considers
necessary to improve patient safety and ensure
appropriate dispensing of medication; and
``(iv) meets such other requirements as the
Secretary may establish.
``(5) Relationship to other provisions of this title;
waiver authority.--
``(A) In general.--The following provisions shall
not apply with respect to the program under this
subsection:
``(i) Paragraphs (1) and (3)(B) of section
1860D-4(a) (relating to dissemination of
general information; availability of
information on changes in formulary through the
internet).
``(ii) Subparagraphs (A) and (B) of section
1860D-4(b)(3) (relating to requirements on
development and application of formularies;
formulary development).
``(iii) Paragraphs (1)(C) and (2) of
section 1860D-4(c) (relating to medication
therapy management program).
``(B) Waiver authority.--The Secretary may waive
such other requirements of title XI and this title as
may be necessary to carry out the purposes of the
program established under this subsection.''.
SEC. 132. ALLOWING THE OFFERING OF ADDITIONAL PRESCRIPTION DRUG PLANS
UNDER MEDICARE PART D.
(a) Rescinding and Issuance of New Guidance.--Not later than one
year after the date of the enactment of this Act, the Secretary of
Health and Human Services (in this section referred to as the
``Secretary'') shall--
(1) rescind sections of any sub-regulatory guidance that
limit the number of prescription drug plans in each PDP region
that may be offered by a PDP sponsor under part D of title
XVIII of the Social Security Act (42 U.S.C. 1395w-101 et seq.);
and
(2) issue new guidance specifying that a PDP sponsor may
offer up to 4 (or a greater number if determined appropriate by
the Secretary) prescription drug plans in each PDP region,
except in cases where the PDP sponsor may offer up to 2
additional plans in a PDP region pursuant to section 1860D-
11(d)(4) of the Social Security Act (42 U.S.C. 1395w-
111(d)(4)), as added by subsection (b).
(b) Offering of Additional Plans.--Section 1860D-11(d) of the
Social Security Act (42 U.S.C. 1395w-111(d)) is amended by adding at
the end the following new paragraph:
``(4) Offering of additional plans.--
``(A) In general.--For plan year 2022 and each
subsequent plan year, a PDP sponsor may offer up to 2
additional prescription drug plans in a PDP region (in
addition to any limit established by the Secretary
under this part) provided that the PDP sponsor complies
with subparagraph (B) with respect to at least one such
prescription drug plan.
``(B) Requirements.--In order to be eligible to
offer up to 2 additional plans in a PDP region pursuant
to subparagraph (A), a PDP sponsor must ensure that,
with respect to at least one such prescription drug
plan, the sponsor or any entity that provides pharmacy
benefits management services under a contract with any
such sponsor or plan does not receive direct or
indirect remuneration, as defined in section 423.308 of
title 42, Code of Federal Regulations (or any successor
regulation), unless at least 25 percent of the
aggregate reductions in price or other remuneration
received by the PDP sponsor or entity from drug
manufacturers with respect to the plan and plan year--
``(i) are reflected at the point-of-sale to
the enrollee; or
``(ii) are used to reduce total beneficiary
cost-sharing estimated by the PDP sponsor for
prescription drug coverage under the plan in
the annual bid submitted by the PDP sponsor
under section 1860D-11(b).
``(C) Definition of reductions in price.--For
purposes of subparagraph (B), the term `reductions in
price' refers only to collectible amounts, as
determined by the Secretary, which excludes amounts
which after adjudication and reconciliation with
pharmacies and manufacturers are duplicate in nature,
contrary to other contractual clauses, or otherwise
ineligible (such as due to beneficiary disenrollment or
coordination of benefits).''.
(c) Rule of Construction.--Nothing in the provisions of, or
amendments made by, this section shall be construed as limiting the
ability of the Secretary to increase any limit otherwise applicable on
the number of prescription drug plans that a PDP sponsor may offer, at
the discretion of the PDP sponsor, in a PDP region under part D of
title XVIII of the Social Security Act (42 U.S.C. 1395w-101 et seq.).
SEC. 133. ALLOWING CERTAIN ENROLLEES OF PRESCRIPTION DRUGS PLANS AND
MA-PD PLANS UNDER MEDICARE PROGRAM TO SPREAD OUT COST-
SHARING UNDER CERTAIN CIRCUMSTANCES.
(a) Standard Prescription Drug Coverage.--Section 1860D-2(b)(2) of
the Social Security Act (42 U.S.C. 1395w-102(b)(2)), as amended by
section 121, is further amended--
(1) in subparagraph (A), by striking ``Subject to
subparagraphs (C) and (D)'' and inserting ``Subject to
subparagraphs (C), (D), and (E)''; and
(2) by adding at the end the following new subparagraph:
``(E) Enrollee option regarding spreading cost-
sharing.--
``(i) In general.--The Secretary shall
establish by regulation a process under which,
with respect to plan year 2022 and subsequent
plan years, a prescription drug plan or an MA-
PD plan shall, in the case of a part D eligible
individual enrolled with such plan for such
plan year with respect to whom the plan
projects that the dispensing of a covered part
D drug to such individual will result in the
individual incurring costs within a 30-day
period that are equal to a significant
percentage (as specified by the Secretary
pursuant to such regulation) of the annual out-
of-pocket threshold specified in paragraph
(4)(B) for such plan year, provide such
individual with the option to make the
coinsurance payment required under subparagraph
(A) for such costs in the form of equal monthly
installments over the remainder of such plan
year.
``(ii) Significant percentage
limitations.--In specifying a significant
percentage pursuant to the regulation
established by the Secretary under clause (i),
the Secretary may not specify a percentage that
is less than 30 percent or greater than 100
percent.''.
(b) Alternative Prescription Drug Coverage.--Section 1860D-2(c) of
the Social Security Act (42 U.S.C. 1395w-102(c)) is amended by adding
at the end the following new paragraph:
``(4) Same enrollee option regarding spreading cost-
sharing.--For plan year 2022 and subsequent plan years, the
coverage provides the enrollee option regarding spreading cost-
sharing described in and required under subsection
(b)(2)(E).''.
SEC. 134. ESTABLISHING A MONTHLY CAP ON BENEFICIARY INCURRED COSTS FOR
INSULIN PRODUCTS AND SUPPLIES UNDER A PRESCRIPTION DRUG
PLAN OR MA-PD PLAN.
(a) In General.--Section 1860D-2 of the Social Security Act (42
U.S.C. 1395w-102), as amended by sections 121 and 133, is further
amended--
(1) in subsection (b)(2)--
(A) in subparagraph (A), by striking ``and (E)''
and inserting ``(E), and (F)'';
(B) in subparagraph (B), by striking ``and (D)''
and inserting ``(D), and (F)''; and
(C) by adding at the end the following new
subparagraph:
``(F) Cap on incurred costs for insulin products
and supplies.--
``(i) In general.--The coverage provides
benefits, for costs above the annual deductible
specified in paragraph (1) and up to the annual
out-of-pocket threshold described in paragraph
(4)(B) and with respect to a month (beginning
with January of 2022), with cost sharing that
is equal to $0 for a specified covered part D
drug (as defined in clause (iii)) furnished to
an individual who has incurred costs during
such month with respect to specified covered
part D drugs equal to--
``(I) for months occurring in 2022,
$50; or
``(II) for months occurring in a
subsequent year, the amount applicable
under this clause for months occurring
in the year preceding such subsequent
year, increased by the annual
percentage increase specified in
paragraph (6) for such subsequent year
and rounded to the nearest dollar.
``(ii) Application.--The provisions of
clauses (i) through (iii) of paragraph (4)(C)
shall apply with respect to the determination
of the incurred costs for specified covered
part D drugs for purposes of clause (i) in the
same manner as such provisions apply with
respect to the determination of incurred costs
for covered part D drugs for purposes of
paragraph (4)(A).
``(iii) Specified covered part d drug.--For
purposes of this subparagraph, the term
`specified covered part D drug' means a covered
part D drug that is--
``(I) insulin; or
``(II) a medical supply associated
with the injection of insulin (as
defined in regulations of the Secretary
promulgated pursuant to subsection
(e)(1)(B)).''; and
(2) in subsection (c), by adding at the end the following
new paragraph:
``(5) Same protection with respect to expenditures for
insulin and certain medical supplies.--The coverage provides
the coverage required under subsection (b)(2)(F).''.
(b) Conforming Amendments.--
(1) In general.--Section 1860D-14(a)(1)(D) of the Social
Security Act (42 U.S.C. 1395w-114(a)(1)(D)), as amended by
section 121, is further amended--
(A) in clause (ii), by striking ``section 1860D-
2(b)(2)'' and inserting ``section 1860D-2(b)(2)(A)'';
and
(B) in clause (iii), by striking ``section 1860D-
2(b)(2)'' and inserting ``section 1860D-2(b)(2)(A)''.
(2) Effective date.--The amendments made by paragraph (1)
shall apply with respect to plan year 2022 and each subsequent
plan year.
SEC. 135. GROWTH RATE OF MEDICARE PART D OUT-OF-POCKET COST THRESHOLD.
(a) Providing Medicare Part D Beneficiaries With Certain 2020
Offset Payments.--Section 1860D-2(b)(4) of the Social Security Act (42
U.S.C. 1395w-102(b)(4)) is amended by adding at the end the following
new subparagraph:
``(F) 2020 offset payments.--
``(i) In general.--Subject to clause (iv),
the Secretary shall provide for payment from
the Medicare Prescription Drug Account as
follows:
``(I) In the case of a specified
individual (as defined in clause
(ii)(I)) who as of the last day of a
calendar quarter in 2020 has incurred
costs for covered part D drugs so that
the individual has exceeded the annual
out-of-pocket threshold applied under
subparagraph (B)(i)(V) for 2020,
payment to the individual by not later
than 15th day of the third month
following the end of such quarter of
the amount by which such threshold so
applied exceeded the target threshold
for 2020.
``(II) In the case of a specified
individual who is not described in
subclause (I) and who as of the last
day of 2020 has incurred costs for
covered part D drugs so that the
individual has exceeded the target
threshold for 2020, payment to the
individual by not later than December
31, 2021, of the amount by which such
incurred costs exceeded the target
threshold for 2020.
``(ii) Definitions.--For purposes of this
subparagraph:
``(I) Specified individual.--The
term `specified individual' means an
individual who--
``(aa) is enrolled in a
prescription drug plan or an
MA- PD plan;
``(bb) is not enrolled in a
qualified retiree prescription
drug plan; and
``(cc) is not entitled to
an income-related subsidy under
section 1860D-14(a).
``(II) Target threshold for 2020.--
the term `target threshold for 2020'
means the annual out-of-pocket
threshold that would have been applied
under subparagraph (B)(i) for 2020 if
such threshold had been determined in
accordance with subclause (IV) of such
subparagraph instead of subclause (V)
of such subparagraph.
``(iii) Notification.--In the case of any
specified individual who during 2020 has
incurred costs for covered part D drugs so that
the individual has exceeded the target
threshold for 2020, the Secretary shall, not
later than September 30, 2021, provide to such
individual a notification informing such
individual of such individual's right to a
payment described in clause (i) and the
estimated timing of such payment.
``(iv) Clarification.--The Secretary shall
provide only 1 payment under this subparagraph
with respect to any individual.
``(v) Implementation.--The Secretary may
implement this subparagraph by program
instruction or otherwise.''.
(b) Reduced Growth Rate for 2021 of Medicare Part D Out-of-Pocket
Cost Threshold.--Section 1860D-2(b)(4)(B)(i) of the Social Security Act
(42 U.S.C. 1395w-102(b)(4)(B)(i)) is amended--
(1) in subclause (V), by striking at the end ``or'';
(2) by redesignating subclause (VI) as subclause (VIII);
and
(3) by inserting after subclause (V) the following new
subclauses:
``(VI) for 2021, is equal to the
amount that would have been applied
under this subparagraph for 2020 if
such amount had been determined in
accordance with subclause (IV) instead
of subclause (V), increased by the
lesser of--
``(aa) the annual
percentage increase described
in paragraph (7) for 2021, plus
2 percentage points; or
``(bb) the annual
percentage increase described
in paragraph (6) for 2021;
``(VII) for 2022, is equal to the
amount that would have been applied
under this subparagraph for 2022 if the
amendments made by section 1101(d)(1)
of the Health Care and Education
Reconciliation Act of 2010 and by
section 135 of the Lower Costs, More
Cures Act of 2019 had not been enacted;
or''.
Subtitle E--MedPAC
SEC. 141. PROVIDING THE MEDICARE PAYMENT ADVISORY COMMISSION AND
MEDICAID AND CHIP PAYMENT AND ACCESS COMMISSION WITH
ACCESS TO CERTAIN DRUG PAYMENT INFORMATION, INCLUDING
CERTAIN REBATE INFORMATION.
(a) Access to Certain Part D Payment Data.--Section 1860D-15(f) of
the Social Security Act (42 U.S.C. 1395w-115(f)) is amended--
(1) in paragraph (2)--
(A) in subparagraph (A)(ii), by striking ``and'' at
the end;
(B) in subparagraph (B), by striking the period at
the end and inserting ``; and''; and
(C) by inserting at the end the following new
subparagraph:
``(C) by the Executive Director of the Medicare
Payment Advisory Commission for purposes of monitoring,
making recommendations, and analysis of the program
under this title and by the Executive Director of the
Medicaid and CHIP Payment and Access Commission for
purposes of monitoring, making recommendations, and
analysis of the Medicaid program established under
title XIX and the Children's Health Insurance Program
under title XXI.''; and
(2) by adding at the end the following new paragraph:
``(3) Additional restrictions on disclosure of
information.--The Executive Directors described in paragraph
(2)(C) shall not disclose any of the following information
disclosed to such Executive Directors or obtained by such
Executive Directors pursuant to such paragraph, with respect to
a prescription drug plan offered by a PDP sponsor:
``(A) The specific amounts or the identity of the
source of any rebates, price concessions, or other
forms of direct or indirect remuneration under such
prescription drug plan.
``(B) Information submitted with the bid submitted
under section 1860D-11 by such PDP sponsor.
``(C) In the case of such information from
prescription drug event records, in a form that would
not be permitted under section 423.505(m) of title 42,
Code of Federal Regulations, or any successor
regulation, if made by the Centers for Medicare &
Medicaid Services.''.
(b) Access to Certain Rebate and Payment Data Under Medicare and
Medicaid.--Section 1927(b)(3)(D) of the Social Security Act (42 U.S.C.
1396r-8(b)(3)(D)) is amended--
(1) in the matter before clause (i), by striking
``subsection (a)(6)(A)(ii)'' and inserting ``subsection
(a)(6)(A)'';
(2) in clause (v), by striking ``and'' at the end;
(3) in clause (vi), by striking the period at the end and
inserting ``, and'';
(4) by inserting after clause (vi) the following new
clause:
``(vii) to permit the Executive Director of
the Medicare Payment Advisory Commission and
the Executive Director of the Medicaid and CHIP
Payment and Access Commission to review the
information provided.'';
(5) in the matter at the end, by striking ``1860D-
4(c)(2)(E)'' and inserting ``1860D-4(c)(2)(G)''; and
(6) by adding at the end the following new sentence: ``Any
information disclosed to the Executive Director of the Medicare
Payment Advisory Commission or the Executive Director of the
Medicaid and CHIP Payment and Access Commission pursuant to
this subparagraph shall not be disclosed by either such
Executive Director in a form which discloses the identity of a
specific manufacturer or wholesaler or prices charged for drugs
by such manufacturer or wholesaler.''.
TITLE II--MEDICAID
SEC. 201. SUNSET OF LIMIT ON MAXIMUM REBATE AMOUNT FOR SINGLE SOURCE
DRUGS AND INNOVATOR MULTIPLE SOURCE DRUGS.
Section 1927(c)(2)(D) of the Social Security Act (42 U.S.C. 1396r-
8(c)(2)(D)) is amended by inserting after ``December 31, 2009,'' the
following: ``and before January 1, 2023,''.
SEC. 202. MEDICAID PHARMACY AND THERAPEUTICS COMMITTEE IMPROVEMENTS.
(a) In General.--Subparagraph (A) of section 1927(d)(4) of the
Social Security Act (42 U.S.C. 1396r-8(d)(4)) is amended to read as
follows:
``(A)(i) The formulary is developed and reviewed by
a pharmacy and therapeutics committee consisting of
physicians, pharmacists, and other appropriate
individuals appointed by the Governor of the State.
``(ii) Subject to clause (vi), the State
establishes and implements a conflict of interest
policy for the pharmacy and therapeutics committee
that--
``(I) is publicly accessible;
``(II) requires all committee members to
complete, on at least an annual basis, a
disclosure of relationships, associations, and
financial dealings that may affect their
independence of judgement in committee matters;
and
``(III) contains clear processes, such as
recusal from voting or discussion, for those
members who report a conflict of interest,
along with appropriate processes to address any
instance where a member fails to report a
conflict of interest.
``(iii) The membership of the pharmacy and
therapeutics committee--
``(I) includes at least 1 actively
practicing physician and at least 1 actively
practicing pharmacist, each of whom--
``(aa) is independent and free of
conflict with respect to manufacturers
and Medicaid participating plans or
subcontractors, including pharmacy
benefit managers; and
``(bb) has expertise in the care of
1 or more Medicaid-specific populations
such as elderly or disabled
individuals, children with complex
medical needs, or low-income
individuals with chronic illnesses; and
``(II) is made publicly available.
``(iv) At the option of the State, the State's drug
use review board established under subsection (g)(3)
may serve as the pharmacy and therapeutics committee
provided the State ensures that such board meets the
requirements of clauses (ii) and (iii).
``(v) The State reviews and has final approval of
the formulary established by the pharmacy and
therapeutics committee.
``(vi) If the Secretary determines it appropriate
or necessary based on the findings and recommendations
of the Comptroller General of the United States in the
report submitted to Congress under section 203 of the
Lower Costs, More Cures Act of 2019, the Secretary
shall issue guidance that States must follow for
establishing conflict of interest policies for the
pharmacy and therapeutics committee in accordance with
the requirements of clause (ii), including appropriate
standards and requirements for identifying, addressing,
and reporting on conflicts of interest.''.
(b) Application to Medicaid Managed Care Organizations.--Clause
(xiii) of section 1903(m)(2)(A) of the Social Security Act (42 U.S.C.
1396b(m)(2)(A)) is amended--
(1) by striking ``and (III)'' and inserting ``(III)'';
(2) by striking the period at the end and inserting ``, and
(IV) any formulary used by the entity for covered outpatient
drugs dispensed to individuals eligible for medical assistance
who are enrolled with the entity is developed and reviewed by a
pharmacy and therapeutics committee that meets the requirements
of clauses (ii) and (iii) of section 1927(d)(4)(A).''; and
(3) by moving the left margin 2 ems to the left.
(c) Effective Date.--The amendments made by this section shall take
effect on the date that is 1 year after the date of enactment of this
Act.
SEC. 203. GAO REPORT ON CONFLICTS OF INTEREST IN STATE MEDICAID PROGRAM
DRUG USE REVIEW BOARDS AND PHARMACY AND THERAPEUTICS
(P&T) COMMITTEES.
(a) Investigation.--The Comptroller General of the United States
shall conduct an investigation of potential or existing conflicts of
interest among members of State Medicaid program State drug use review
boards (in this section referred to as ``DUR Boards'') and pharmacy and
therapeutics committees (in this section referred to as ``P&T
Committees'').
(b) Report.--Not later than 24 months after the date of enactment
of this Act, the Comptroller General shall submit to Congress a report
on the investigation conducted under subsection (a) that includes the
following:
(1) A description outlining how DUR Boards and P&T
Committees operate in States, including details with respect
to--
(A) the structure and operation of DUR Boards and
statewide P&T Committees;
(B) States that operate separate P&T Committees for
their fee-for-service Medicaid program and their
Medicaid managed care organizations or other Medicaid
managed care arrangements (collectively referred to in
this section as ``Medicaid MCOs)''; and
(C) States that allow Medicaid MCOs to have their
own P&T Committees and the extent to which pharmacy
benefit managers administer or participate in such P&T
Committees.
(2) A description outlining the differences between DUR
Boards established in accordance with section 1927(g)(3) of the
Social Security Act (42 U.S.C. 1396r(g)(3)) and P&T Committees.
(3) A description outlining the tools P&T Committees may
use to determine Medicaid drug coverage and utilization
management policies.
(4) An analysis of whether and how States or P&T Committees
establish participation and independence requirements for DUR
Boards and P&T Committees, including with respect to entities
with connections with drug manufacturers, State Medicaid
programs, managed care organizations, and other entities or
individuals in the pharmaceutical industry.
(5) A description outlining how States, DUR Boards, or P&T
Committees define conflicts of interest.
(6) A description of how DUR Boards and P&T Committees
address conflicts of interest, including who is responsible for
implementing such policies.
(7) A description of the tools, if any, States use to
ensure that there are no conflicts of interest on DUR Boards
and P&T Committees.
(8) An analysis of the effectiveness of tools States use to
ensure that there are no conflicts of interest on DUR Boards
and P&T Committees and, if applicable, recommendations as to
how such tools could be improved.
(9) A review of strategies States may use to guard against
conflicts of interest on DUR Boards and P&T Committees and to
ensure compliance with the requirements of titles XI and XIX of
the Social Security Act (42 U.S.C. 1301 et seq., 1396 et seq.)
and access to effective, clinically appropriate, and medically
necessary drug treatments for Medicaid beneficiaries, including
recommendations for such legislative and administrative actions
as the Comptroller General determines appropriate.
SEC. 204. ENSURING THE ACCURACY OF MANUFACTURER PRICE AND DRUG PRODUCT
INFORMATION UNDER THE MEDICAID DRUG REBATE PROGRAM.
(a) Audit of Manufacturer Price and Drug Product Information.--
(1) In general.--Subparagraph (B) of section 1927(b)(3) of
the Social Security Act (42 U.S.C. 1396r-8(b)(3)) is amended to
read as follows:
``(B) Audits and surveys of manufacturer price and
drug product information.--
``(i) Audits.--The Secretary shall conduct
ongoing audits of the price and drug product
information reported by manufacturers under
subparagraph (A) for the most recently ended
rebate period to ensure the accuracy and
timeliness of such information. In conducting
such audits, the Secretary may employ
evaluations, surveys, statistical sampling,
predictive analytics and other relevant tools
and methods.
``(ii) Verifications surveys of average
manufacturer price and manufacturer's average
sales price.--In addition to the audits
required under clause (i), the Secretary may
survey wholesalers and manufacturers (including
manufacturers that directly distribute their
covered outpatient drugs (in this subparagraph
referred to as `direct sellers')), when
necessary, to verify manufacturer prices and
manufacturer's average sales prices (including
wholesale acquisition cost) to make payment
reported under subparagraph (A).
``(iii) Penalties.--In addition to other
penalties as may be prescribed by law,
including under subparagraph (C) of this
paragraph, the Secretary may impose a civil
monetary penalty in an amount not to exceed
$185,000 on an annual basis on a wholesaler,
manufacturer, or direct seller, if the
wholesaler, manufacturer, or direct seller of a
covered outpatient drug refuses a request for
information about charges or prices by the
Secretary in connection with an audit or survey
under this subparagraph or knowingly provides
false information. The provisions of section
1128A (other than subsections (a) (with respect
to amounts of penalties or additional
assessments) and (b)) shall apply to a civil
money penalty under this clause in the same
manner as such provisions apply to a penalty or
proceeding under section 1128A(a).
``(iv) Reports.--
``(I) Report to congress.--The
Secretary shall, not later than 18
months after date of enactment of this
subparagraph, submit a report to the
Committee on Energy and Commerce of the
House of Representatives and the
Committee on Finance of the Senate
regarding additional regulatory or
statutory changes that may be required
in order to ensure accurate and timely
reporting and oversight of manufacturer
price and drug product information,
including whether changes should be
made to reasonable assumption
requirements to ensure such assumptions
are reasonable and accurate or whether
another methodology for ensuring
accurate and timely reporting of price
and drug product information should be
considered to ensure the integrity of
the drug rebate program under this
section.
``(II) Annual reports.--The
Secretary shall, on at least an annual
basis, submit a report to the Committee
on Energy and Commerce of the House of
Representatives and the Committee on
Finance of the Senate summarizing the
results of the audits and surveys
conducted under this subparagraph
during the period that is the subject
of the report.
``(III) Content.--Each report
submitted under subclause (II) shall,
with respect to the period that is the
subject of the report, include
summaries of--
``(aa) error rates in the
price, drug product, and other
relevant information supplied
by manufacturers under
subparagraph (A);
``(bb) the timeliness with
which manufacturers,
wholesalers, and direct sellers
provide information required
under subparagraph (A) or under
clause (i) or (ii) of this
subparagraph;
``(cc) the number of
manufacturers, wholesalers, and
direct sellers and drug
products audited under this
subparagraph;
``(dd) the types of price
and drug product information
reviewed under the audits
conducted under this
subparagraph;
``(ee) the tools and
methodologies employed in such
audits;
``(ff) the findings of such
audits, including which
manufacturers, if any, were
penalized under this
subparagraph; and
``(gg) such other relevant
information as the Secretary
shall deem appropriate.
``(IV) Protection of information.--
In preparing a report required under
subclause (II), the Secretary shall
redact such proprietary information as
the Secretary determines appropriate to
prevent disclosure of, and to
safeguard, such information.
``(v) Appropriations.--Out of any funds in
the Treasury not otherwise appropriated, there
is appropriated to the Secretary $2,000,000 for
fiscal year 2020 and each fiscal year
thereafter to carry out this subparagraph.''.
(2) Effective date.--The amendments made by this subsection
shall take effect on the first day of the first fiscal quarter
that begins after the date of enactment of this Act.
(b) Increased Penalties for Noncompliance With Reporting
Requirements.--
(1) Increased penalty for late reporting of information.--
Section 1927(b)(3)(C)(i) of the Social Security Act (42 U.S.C.
1396r-8(b)(3)(C)(i)) is amended by striking ``increased by
$10,000 for each day in which such information has not been
provided and such amount shall be paid to the Treasury'' and
inserting ``, for each covered outpatient drug with respect to
which such information is not provided, $50,000 for the first
day that such information is not provided on a timely basis and
$19,000 for each subsequent day that such information is not
provided''.
(2) Increased penalty for knowingly reporting false
information.--Section 1927(b)(3)(C)(ii) of the Social Security
Act (42 U.S.C. 1396r-8(b)(3)(C)(ii)) is amended by striking
``$100,000'' and inserting ``$500,000''.
(3) Effective date.--The amendments made by this subsection
shall take effect on the first day of the first fiscal quarter
that begins after the date of enactment of this Act.
SEC. 205. IMPROVING TRANSPARENCY AND PREVENTING THE USE OF ABUSIVE
SPREAD PRICING AND RELATED PRACTICES IN MEDICAID.
(a) Pass-Through Pricing Required.--
(1) In general.--Section 1927(e) of the Social Security Act
(42 U.S.C. 1396r-8(e)) is amended by adding at the end the
following:
``(6) Pass-through pricing required.--A contract between
the State and a pharmacy benefit manager (referred to in this
paragraph as a `PBM'), or a contract between the State and a
managed care entity or other specified entity (as such terms
are defined in section 1903(m)(9)(D)) that includes provisions
making the entity responsible for coverage of covered
outpatient drugs dispensed to individuals enrolled with the
entity, shall require that payment for such drugs and related
administrative services (as applicable), including payments
made by a PBM on behalf of the State or entity, is based on a
pass-through pricing model under which--
``(A) any payment made by the entity of the PBM (as
applicable) for such a drug--
``(i) is limited to--
``(I) ingredient cost; and
``(II) a professional dispensing
fee that is not less than the
professional dispensing fee that the
State plan or waiver would pay if the
plan or waiver was making the payment
directly;
``(ii) is passed through in its entirety by
the entity or PBM to the pharmacy that
dispenses the drug; and
``(iii) is made in a manner that is
consistent with section 1902(a)(30)(A) and
sections 447.512, 447.514, and 447.518 of title
42, Code of Federal Regulations (or any
successor regulation), as if such requirements
applied directly to the entity or the PBM;
``(B) payment to the entity or the PBM (as
applicable) for administrative services performed by
the entity or PBM is limited to a reasonable
administrative fee that covers the reasonable cost of
providing such services;
``(C) the entity or the PBM (as applicable) shall
make available to the State, and the Secretary upon
request, all costs and payments related to covered
outpatient drugs and accompanying administrative
services incurred, received, or made by the entity or
the PBM, including ingredient costs, professional
dispensing fees, administrative fees, post-sale and
post-in-voice fees. Discounts, or related adjustments
such as direct and indirect remuneration fees, and any
and all remuneration; and
``(D) any form of spread pricing whereby any amount
charged or claimed by the entity or the PBM (as
applicable) is in excess of the amount paid to the
pharmacies on behalf of the entity, including any post-
sale or post-invoice fees, discounts, or related
adjustments such as direct and indirect remuneration
fees or assessments (after allowing for a reasonable
administrative fee as described in subparagraph (B)) is
not allowable for purposes of claiming Federal matching
payments under this title.''.
(2) Conforming amendment.--Clause (xiii) of section
1903(m)(2)(A) of such Act (42 U.S.C. 1396b(m)(2)(A)), as
amended by section 202, is further amended--
(A) by striking ``and (IV)'' and inserting
``(IV)''; and
(B) by inserting before the period at the end the
following: ``, and (V) pharmacy benefit management
services provided by the entity, or provided by a
pharmacy benefit manager on behalf of the entity under
a contract or other arrangement between the entity and
the pharmacy benefit manager, shall comply with the
requirements of section 1927(e)(6)''.
(3) Effective date.--The amendments made by this subsection
apply to contracts between States and managed care entities,
other specified entities, or pharmacy benefits managers that
are entered into or renewed on or after the date that is 18
months after the date of enactment of this Act.
(b) Survey of Retail Prices.--
(1) In general.--Section 1927(f) of the Social Security Act
(42 U.S.C. 1396r-8(f)) is amended--
(A) by striking ``and'' after the semicolon at the
end of paragraph (1)(A)(i) and all that precedes it
through ``(1)'' and inserting the following:
``(1) Survey of retail prices.--The Secretary shall conduct
a survey of retail community drug prices, to include at least
the national average drug acquisition cost, as follows:
``(A) Use of vendor.--The Secretary may contract
services for--
``(i) with respect to retail community
pharmacies, the determination on a monthly
basis of retail survey prices of the national
average drug acquisition cost for covered
outpatient drugs for such pharmacies, net of
all discounts and rebates (to the extent any
information with respect to such discounts and
rebates is available), the average
reimbursement received for such drugs by such
pharmacies from all sources of payment,
including third parties, and, to the extent
available, the usual and customary charges to
consumers for such drugs; and'';
(B) by adding at the end of paragraph (1) the
following:
``(F) Survey reporting.--In order to meet the
requirement of section 1902(a)(54), a State shall
require that any retail community pharmacy in the State
that receives any payment, administrative fee,
discount, or rebate related to the dispensing of
covered outpatient drugs to individuals receiving
benefits under this title, regardless of whether such
payment, fee, discount, or rebate is received from the
State or a managed care entity directly or from a
pharmacy benefit manager or another entity that has a
contract with the State or a managed care entity, shall
respond to surveys of retail prices conducted under
this subsection.
``(G) Survey information.--Information on retail
community prices obtained under this paragraph shall be
made publicly available and shall include at least the
following:
``(i) The monthly response rate of the
survey including a list of pharmacies not in
compliance with subparagraph (F).
``(ii) The sampling frame and number of
pharmacies sampled monthly.
``(iii) Characteristics of reporting
pharmacies, including type (such as independent
or chain), geographic or regional location, and
dispensing volume.
``(iv) Reporting of a separate national
average drug acquisition cost for each drug for
independent retail pharmacies and chain
operated pharmacies.
``(v) Information on price concessions
including on and off invoice discounts,
rebates, and other price concessions.
``(vi) Information on average professional
dispensing fees paid.
``(H) Penalties.--
``(i) Failure to provide timely
information.--A retail community pharmacy that
fails to respond to a survey conducted under
this subsection on a timely basis may be
subject to a civil monetary penalty in the
amount of $10,000 for each day in which such
information has not been provided.
``(ii) False information.--A retail
community pharmacy that knowingly provides
false information in response to a survey
conducted under this subsection may be subject
to a civil money penalty in an amount not to
exceed $100,000 for each item of false
information.
``(iii) Other penalties.--Any civil money
penalties imposed under this subparagraph shall
be in addition to other penalties as may be
prescribed by law. The provisions of section
1128A (other than subsections (a) and (b))
shall apply to a civil money penalty under this
subparagraph in the same manner as such
provisions apply to a penalty or proceedings
under section 1128A(a).
``(I) Report on specialty pharmacies.--
``(i) In general.--Not later than 1 year
after the effective date of this subparagraph,
the Secretary shall submit a report to Congress
examining specialty drug coverage and
reimbursement under this title.
``(ii) Content of report.--Such report
shall include a description of how State
Medicaid programs define specialty drugs, how
much State Medicaid programs pay for specialty
drugs, how States and managed care plans
determine payment for specialty drugs, the
settings in which specialty drugs are dispensed
(such as retail community pharmacies or
specialty pharmacies), whether acquisition
costs for specialty drugs are captured in the
national average drug acquisition cost survey,
and recommendations as to whether specialty
pharmacies should be included in the survey of
retail prices to ensure national average drug
acquisition costs capture drugs sold at
specialty pharmacies and how such specialty
pharmacies should be defined.'';
(C) in paragraph (2)--
(i) in subparagraph (A), by inserting ``,
including payments rates under Medicaid managed
care plans,'' after ``under this title''; and
(ii) in subparagraph (B), by inserting
``and the basis for such dispensing fees''
before the semicolon; and
(D) in paragraph (4), by inserting ``, and
$5,000,000 for fiscal year 2020 and each fiscal year
thereafter,'' after ``2010''.
(2) Effective date.--The amendments made by this subsection
take effect on the 1st day of the 1st quarter that begins on or
after the date that is 18 months after the date of enactment of
this Act.
(c) Manufacturer Reporting of Wholesale Acquisition Cost.--Section
1927(b)(3) of such Act (42 U.S.C. 1396r-8(b)(3)), as amended by section
141, is further amended--
(1) in subparagraph (A)(i)--
(A) in subclause (I), by striking ``and'' after the
semicolon;
(B) in subclause (II), by adding ``and'' after the
semicolon;
(C) by moving the left margins of subclauses (I)
and (II) 2 ems to the right; and
(D) by adding at the end the following:
``(III) in the case of rebate
periods that begin on or after the date
of enactment of this subclause, on the
wholesale acquisition cost (as defined
in section 1847A(c)(6)(B)) for covered
outpatient drugs for the rebate period
under the agreement (including for all
such drugs that are sold under a new
drug application approved under section
505(c) of the Federal Food, Drug, and
Cosmetic Act);''; and
(2) in subparagraph (D)--
(A) in the matter preceding clause (i), by
inserting ``and clause (vii) of this subparagraph''
after ``1847A'';
(B) in clause (vi), by striking ``and'' after the
comma;
(C) in clause (vii), by striking the period and
inserting ``, and''; and
(D) by inserting after clause (vii) the following:
``(viii) to the Secretary to disclose
(through a website accessible to the public)
the most recently reported wholesale
acquisition cost (as defined in section
1847A(c)(6)(B)) for each covered outpatient
drug (including for all such drugs that are
sold under a new drug application approved
under section 505(c) of the Federal Food, Drug,
and Cosmetic Act), as reported under
subparagraph (A)(i)(III).''.
SEC. 206. T-MSIS DRUG DATA ANALYTICS REPORTS.
(a) In General.--Not later than May 1 of each calendar year
beginning with calendar year 2021, the Secretary of Health and Human
Services (in this section referred to as the ``Secretary'') shall
publish on a website of the Centers for Medicare & Medicaid Services
that is accessible to the public a report of the most recently
available data on provider prescribing patterns under the Medicaid
program.
(b) Content of Report.--
(1) Required content.--Each report required under
subsection (a) for a calendar year shall include the following
information with respect to each State (and, to the extent
available, with respect to Puerto Rico, the United States
Virgin Islands, Guam, the Northern Mariana Islands, and
American Samoa):
(A) A comparison of covered outpatient drug (as
defined in section 1927(k)(2) of the Social Security
Act (42 U.S.C. 1396r-8(k)(2))) prescribing patterns
under the State Medicaid plan or waiver of such plan
(including drugs prescribed on a fee-for-service basis
and drugs prescribed under managed care arrangements
under such plan or waiver)--
(i) across all forms or models of
reimbursement used under the plan or waiver;
(ii) within specialties and subspecialties,
as defined by the Secretary;
(iii) by episodes of care for--
(I) each chronic disease category,
as defined by the Secretary, that is
represented in the 10 conditions that
accounted for the greatest share of
total spending under the plan or waiver
during the year that is the subject of
the report;
(II) procedural groupings; and
(III) rare disease diagnosis codes;
(iv) by patient demographic
characteristics, including race (to the extent
that the Secretary determines that there is
sufficient data available with respect to such
characteristic in a majority of States),
gender, and age;
(v) by patient high-utilizer or risk
status; and
(vi) by high and low resource settings by
facility and place of service categories, as
determined by the Secretary.
(B) In the case of medical assistance for covered
outpatient drugs (as so defined) provided under a State
Medicaid plan or waiver of such plan in a managed care
setting, an analysis of the differences in managed care
prescribing patterns when a covered outpatient drug is
prescribed in a managed care setting as compared to
when the drug is prescribed in a fee-for-service
setting.
(2) Additional content.--A report required under subsection
(a) for a calendar year may include State-specific information
about prescription utilization management tools under State
Medicaid plans or waivers of such plans, including--
(A) a description of prescription utilization
management tools under State programs to provide long-
term services and supports under a State Medicaid plan
or a waiver of such plan;
(B) a comparison of prescription utilization
management tools applicable to populations covered
under a State Medicaid plan waiver under section 1115
of the Social Security Act (42 U.S.C. 1315) and the
models applicable to populations that are not covered
under the waiver;
(C) a comparison of the prescription utilization
management tools employed by different Medicaid managed
care organizations, pharmacy benefit managers, and
related entities within the State;
(D) a comparison of the prescription utilization
management tools applicable to each enrollment category
under a State Medicaid plan or waiver; and
(E) a comparison of the prescription utilization
management tools applicable under the State Medicaid
plan or waiver by patient high-utilizer or risk status.
(3) Additional analysis.--To the extent practicable, the
Secretary shall include in each report published under
subsection (a)--
(A) analyses of national, State, and local patterns
of Medicaid population-based prescribing behaviors; and
(B) recommendations for administrative or
legislative action to improve the effectiveness of, and
reduce costs for, covered outpatient drugs under
Medicaid while ensuring timely beneficiary access to
medically necessary covered outpatient drugs.
(c) Use of T-MSIS Data.--Each report required under subsection (a)
shall--
(1) be prepared using data and definitions from the
Transformed Medicaid Statistical Information System (T-MSIS)
data set (or a successor data set) that is not more than 24
months old on the date that the report is published; and
(2) as appropriate, include a description with respect to
each State of the quality and completeness of the data, as well
as any necessary caveats describing the limitations of the data
reported to the Secretary by the State that are sufficient to
communicate the appropriate uses for the information.
(d) Preparation of Report.--Each report required under subsection
(a) shall be prepared by the Administrator for the Centers for Medicare
& Medicaid Services.
(e) Appropriation.--For fiscal year 2020 and each fiscal year
thereafter, there is appropriated to the Secretary $2,000,000 to carry
out this section.
SEC. 207. RISK-SHARING VALUE-BASED PAYMENT AGREEMENTS FOR COVERED
OUTPATIENT DRUGS UNDER MEDICAID.
(a) In General.--Section 1927 of the Social Security Act (42 U.S.C.
1396r-8) is amended by adding at the end the following new subsection:
``(l) State Option To Pay for Covered Outpatient Drugs Through
Risk-Sharing Value-Based Agreements.--
``(1) In general.--Beginning January 1, 2022, a State shall
have the option to pay (whether on a fee-for-service or managed
care basis) for covered outpatient drugs that are potentially
curative treatments intended for one-time use that are
administered to individuals under this title by entering into a
risk-sharing value-based payment agreement with the
manufacturer of the drug in accordance with the requirements of
this subsection.
``(2) Secretarial approval.--
``(A) In general.--A State shall submit a request
to the Secretary to enter into a risk-sharing value
based payment agreement, and the Secretary shall not
approve a proposed risk-sharing value-based payment
agreement between a State and a manufacturer for
payment for a covered outpatient drug of the
manufacturer unless the following requirements are met:
``(i) Manufacturer is party to rebate
agreement and in compliance with
requirements.--The manufacturer has a rebate
agreement in effect as required under
subsections (a) and (b) of this section and is
in compliance with all applicable requirements
under this title.
``(ii) No increase to projected net federal
spending.--
``(I) In general.--The Chief
Actuary certifies that the projected
payments for each covered outpatient
drug under such proposed agreement
would not result in greater estimated
Federal spending under this title than
the net Federal spending that would
result in the absence of the agreement.
``(II) Net federal spending
defined.--For purposes of this
subsection, the term `net Federal
spending' means the amount of Federal
payments the Chief Actuary estimates
would be made under this title for
administering a covered outpatient drug
to an individual eligible for medical
assistance under a State plan or a
waiver of such plan, reduced by the
amount of all rebates the Chief Actuary
estimates would be paid with respect to
the administering of such drug,
including all rebates under this title
and any supplemental or other
additional rebates, in the absence of
such an agreement.
``(III) Information.--The Chief
Actuary shall make the certifications
required under this clause based on the
most recently available and reliable
drug pricing and product information.
The State and manufacturer shall
provide the Secretary and the Chief
Actuary with all necessary information
required to make the estimates needed
for such certifications.
``(iii) Launch and list price
justifications.--The manufacturer submits all
relevant information and supporting
documentation necessary for pricing decisions
as deemed appropriate by the Secretary, which
shall be truthful and non-misleading, including
manufacturer information and supporting
documentation for launch price or list price
increases, and any applicable justification
required under section 1128L.
``(iv) Confidentiality of information;
penalties.--The provisions of subparagraphs (C)
and (D) of subsection (b)(3) shall apply to a
manufacturer that fails to submit the
information and documentation required under
clauses (ii) and (iii) on a timely basis, or
that knowingly provides false or misleading
information, in the same manner as such
provisions apply to a manufacturer with a
rebate agreement under this section.
``(B) Consideration of state request for
approval.--
``(i) In general.--The Secretary shall
treat a State request for approval of a risk-
sharing value-based payment agreement in the
same manner that the Secretary treats a State
plan amendment, and subpart B of part 430 of
title 42, Code of Federal Regulations,
including, subject to clause (ii), the timing
requirements of section 430.16 of such title
(as in effect on the date of enactment of this
subsection), shall apply to a request for
approval of a risk-sharing value-based payment
agreement in the same manner as such subpart
applies to a State plan amendment.
``(ii) Timing.--The Secretary shall consult
with the Commissioner of Food and Drugs as
required under subparagraph (C) and make a
determination on whether to approve a request
from a State for approval of a proposed risk-
sharing value-based payment agreement (or
request additional information necessary to
allow the Secretary to make a determination
with respect to such request for approval)
within the time period, to the extent
practicable, specified in section 430.16 of
title 42, Code of Federal Regulations (as in
effect on the date of enactment of this
subsection), but in no case shall the Secretary
take more than 180 days after the receipt of
such request for approval or response to such
request for additional information to make such
a determination (or request additional
information).
``(C) Consultation with the commissioner of food
and drugs.--In considering whether to approve a risk-
sharing value-based payment agreement, the Secretary,
to the extent necessary, shall consult with the
Commissioner of Food and Drugs to determine whether the
relevant clinical parameters specified in such
agreement are appropriate.
``(3) Installment-based payment structure.--
``(A) In general.--A risk-sharing value-based
payment agreement shall provide for a payment structure
under which, for every installment year of the
agreement (subject to subparagraph (B)), the State
shall pay the total installment year amount in equal
installments to be paid at regular intervals over a
period of time that shall be specified in the
agreement.
``(B) Requirements for installment payments.--
``(i) Timing of first payment.--The State
shall make the first of the installment
payments described in subparagraph (A) for an
installment year not later than 30 days after
the end of such year.
``(ii) Length of installment period.--The
period of time over which the State shall make
the installment payments described in
subparagraph (A) for an installment year shall
not be longer than 5 years.
``(iii) Nonpayment or reduced payment of
installments following a failure to meet
clinical parameter.--If, prior to the payment
date (as specified in the agreement) of any
installment payment described in subparagraph
(A) or any other alternative date or time frame
(as otherwise specified in the agreement), the
covered outpatient drug which is subject to the
agreement fails to meet a relevant clinical
parameter of the agreement, the agreement shall
provide that--
``(I) the installment payment shall
not be made; or
``(II) the installment payment
shall be reduced by a percentage
specified in the agreement that is
based on the outcome achieved by the
drug relative to the relevant clinical
parameter.
``(4) Notice of intent.--
``(A) In general.--Subject to subparagraph (B), a
manufacturer of a covered outpatient drug shall not be
eligible to enter into a risk-sharing value-based
payment agreement under this subsection with respect to
such drug unless the manufacturer notifies the
Secretary that the manufacturer is interested in
entering into such an agreement with respect to such
drug. The decision to submit and timing of a request to
enter into a proposed risk-sharing value-based payment
agreement shall remain solely within the discretion of
the State and shall only be effective upon Secretarial
approval as required under this subsection.
``(B) Treatment of subsequently approved drugs.--
``(i) In general.--In the case of a
manufacturer of a covered outpatient drug
approved under section 505 of the Federal Food,
Drug, and Cosmetic Act or licensed under
section 351 of the Public Health Service Act
after the date of enactment of this subsection,
not more than 90 days after meeting with the
Food and Drug Administration following phase II
clinical trials for such drug (or, in the case
of a drug described in clause (ii), not later
than March 31, 2022), the manufacturer must
notify the Secretary of the manufacturer's
intent to enter into a risk-sharing value-based
payment agreement under this subsection with
respect to such drug. If no such meeting has
occurred, the Secretary may use discretion as
to whether a potentially curative treatment
intended for one-time use may qualify for a
risk-sharing value-based payment agreement
under this section. A manufacturer notification
of interest shall not have any influence on a
decision for approval by the Food and Drug
Administration.
``(ii) Application to certain subsequently
approved drugs.--A drug described in this
clause is a covered outpatient drug of a
manufacturer--
``(I) that is approved under
section 505 of the Federal Food, Drug,
and Cosmetic Act or licensed under
section 351 of the Public Health
Service Act after the date of enactment
of this subsection; and
``(II) with respect to which, as of
January 1, 2022, more than 90 days have
passed after the manufacturer's meeting
with the Food and Drug Administration
following phase II clinical trials for
such drug.
``(iii) Parallel approval.--The Secretary,
in coordination with the Administrator of the
Centers for Medicare & Medicaid Services and
the Commissioner of Food and Drugs, shall, to
the extent practicable, approve a State's
request to enter into a proposed risk-sharing
value-based payment agreement that otherwise
meets the requirements of this subsection at
the time that such a drug is approved by the
Food and Drug Administration to help provide
that no State that wishes to enter into such an
agreement is required to pay for the drug in
full at one time if the State is seeking to pay
over a period of time as outlined in the
proposed agreement.
``(iv) Rule of construction.--Nothing in
this paragraph shall be applied or construed to
modify or affect the timeframes or factors
involved in the Secretary's determination of
whether to approve or license a drug under
section 505 of the Federal Food, Drug, and
Cosmetic Act or section 351 of the Public
Health Service Act.
``(5) Special payment rules.--
``(A) In general.--Except as otherwise provided in
this paragraph, with respect to an individual who is
administered a unit of a covered outpatient drug that
is purchased under a State plan by a State Medicaid
agency under a risk-sharing value-based payment
agreement in an installment year, the State shall
remain liable to the manufacturer of such drug for
payment for such unit without regard to whether the
individual remains enrolled in the State plan under
this title (or a waiver of such plan) for each
installment year for which the State is to make
installment payments for covered outpatient drugs
purchased under the agreement in such year.
``(B) Death.--In the case of an individual
described in subparagraph (A) who dies during the
period described in such subparagraph, the State plan
shall not be liable for any remaining payment for the
unit of the covered outpatient drug administered to the
individual which is owed under the agreement described
in such subparagraph.
``(C) Withdrawal of approval.--In the case of a
covered outpatient drug that is the subject of a risk-
sharing value-based agreement between a State and a
manufacturer under this subsection, including a drug
approved in accordance with section 506(c) of the
Federal Food, Drug, and Cosmetic Act, and such drug is
the subject of an application that has been withdrawn
by the Secretary, the State plan shall not be liable
for any remaining payment that is owed under the
agreement.
``(D) Alternative arrangement under agreement.--
Subject to approval by the Secretary, the terms of a
proposed risk-sharing value-based payment agreement
submitted for approval by a State may provide that
subparagraph (A) shall not apply.
``(E) Guidance.--Not later than January 1, 2022,
the Secretary shall issue guidance to States
establishing a process for States to notify the
Secretary when an individual who is administered a unit
of a covered outpatient drug that is purchased by a
State plan under a risk-sharing value-based payment
agreement ceases to be enrolled under the State plan
under this title (or a waiver of such plan) or dies
before the end of the installment period applicable to
such unit under the agreement.
``(6) Treatment of payments under risk-sharing value-based
agreements for purposes of average manufacturer price; best
price.--The Secretary shall treat any payments made to the
manufacturer of a covered outpatient drug under a risk-sharing
value-based payment agreement under this subsection during a
rebate period in the same manner that the Secretary treats
payments made under a State supplemental rebate agreement under
sections 447.504(c)(19) and 447.505(c)(7) of title 42, Code of
Federal Regulations (or any successor regulations), for
purposes of determining average manufacturer price and best
price under this section with respect to the covered outpatient
drug and a rebate period and for purposes of offsets required
under subsection (b)(1)(B).
``(7) Assessments and report to congress.--
``(A) Assessments.--
``(i) In general.--Not later than 180 days
after the end of each assessment period of any
risk-sharing value-based payment agreement for
a State approved under this subsection, the
Secretary shall conduct an evaluation of such
agreement which shall include an evaluation by
the Chief Actuary to determine whether program
spending under the risk-sharing value-based
payment agreement aligned with the projections
for the agreement made under paragraph
(2)(A)(ii), including an assessment of whether
actual Federal spending under this title under
the agreement was less or more than net Federal
spending would have been in the absence of the
agreement.
``(ii) Assessment period.--For purposes of
clause (i)--
``(I) the first assessment period
for a risk-sharing value-based payment
agreement shall be the period of time
over which payments are scheduled to be
made under the agreement for the first
10 individuals who are administered
covered outpatient drugs under the
agreement except that such period shall
not exceed the 5-year period after the
date on which the Secretary approves
the agreement; and
``(II) each subsequent assessment
period for a risk-sharing value-based
payment agreement shall be the 5-year
period following the end of the
previous assessment period.
``(B) Results of assessments.--
``(i) Termination option.--If the Secretary
determines as a result of the assessment by the
Chief Actuary under subparagraph (A) that the
actual Federal spending under this title for
any covered outpatient drug that was the
subject of the State's risk-sharing value-based
payment agreement was greater than the net
Federal spending that would have resulted in
the absence of the agreement, the Secretary may
terminate approval of such agreement and shall
immediately conduct an assessment under this
paragraph of any other ongoing risk-sharing
value-based payment agreement to which the same
manufacturer is a party.
``(ii) Repayment required.--
``(I) In general.--If the Secretary
determines as a result of the
assessment by the Chief Actuary under
subparagraph (A) that the Federal
spending under the risk-sharing value-
based agreement for a covered
outpatient drug that was subject to
such agreement was greater than the net
Federal spending that would have
resulted in the absence of the
agreement, the manufacturer shall repay
the difference to the State and Federal
governments in a timely manner as
determined by the Secretary.
``(II) Termination for failure to
pay.--The failure of a manufacturer to
make repayments required under
subclause (I) in a timely manner shall
result in immediate termination of all
risk-sharing value-based agreements to
which the manufacturer is a party.
``(III) Additional penalties.--In
the case of a manufacturer that fails
to make repayments required under
subclause (I), the Secretary may treat
such manufacturer in the same manner as
a manufacturer that fails to pay
required rebates under this section,
and the Secretary may--
``(aa) suspend or terminate
the manufacturer's rebate
agreement under this section;
and
``(bb) pursue any other
remedy that would be available
if the manufacturer had failed
to pay required rebates under
this section.
``(C) Report to congress.--Not later than 5 years
after the first risk-sharing value-based payment
agreement is approved under this subsection, the
Secretary shall submit to Congress and make available
to the public a report that includes--
``(i) an assessment of the impact of risk-
sharing value-based payment agreements on
access for individuals who are eligible for
benefits under a State plan or waiver under
this title to medically necessary covered
outpatient drugs and related treatments;
``(ii) an analysis of the impact of such
agreements on overall State and Federal
spending under this title;
``(iii) an assessment of the impact of such
agreements on drug prices, including launch
price and price increases; and
``(iv) such recommendations to Congress as
the Secretary deems appropriate.
``(8) Guidance and regulations.--
``(A) In general.--Not later than January 1, 2022,
the Secretary shall issue guidance to States seeking to
enter into risk-sharing value-based payment agreements
under this subsection that includes a model template
for such agreements. The Secretary may issue any
additional guidance or promulgate regulations as
necessary to implement and enforce the provisions of
this subsection.
``(B) Model agreements.--
``(i) In general.--If a State expresses an
interest in pursuing a risk-sharing value-based
payment agreement under this subsection with a
manufacturer for the purchase of a covered
outpatient drug, the Secretary may share with
such State any risk-sharing value-based
agreement between a State and the manufacturer
for the purchase of such drug that has been
approved under this subsection. While such
shared agreement may serve as a template for a
State that wishes to propose, the use of a
previously approved agreement shall not affect
the submission and approval process for
approval of a proposed risk-sharing value-based
payment agreement under this subsection,
including the requirements under paragraph
(2)(A).
``(ii) Confidentiality.--In the case of a
risk-sharing value-based payment agreement that
is disclosed to a State by the Secretary under
this subparagraph and that is only in effect
with respect to a single State, the
confidentiality of information provisions
described in subsection (b)(3)(D) shall apply
to such information.
``(C) OIG consultation.--
``(i) In general.--The Secretary shall
consult with the Office of the Inspector
General of the Department of Health and Human
Services to determine whether there are
potential program integrity concerns with
agreement approvals or templates and address
accordingly.
``(ii) OIG policy updates as necessary.--
The Inspector General of the Department of
Health and Human Services shall review and
update, as necessary, any policies or
guidelines of the Office of the Inspector
General of the Department of Human Services
(including policies related to the enforcement
of section 1128B) to accommodate the use of
risk-sharing value-based payment agreements in
accordance with this section.
``(9) Rules of construction.--
``(A) Modifications.--Nothing in this subsection or
any regulations promulgated under this subsection shall
prohibit a State from requesting a modification from
the Secretary to the terms of a risk-sharing value-
based payment agreement. A modification that is
expected to result in any increase to projected net
State or Federal spending under the agreement shall be
subject to recertification by the Chief Actuary as
described in paragraph (2)(A)(ii) before the
modification may be approved.
``(B) Rebate agreements.--Nothing in this
subsection shall be construed as requiring a State to
enter into a risk-sharing value-based payment agreement
or as limiting or superseding the ability of a State to
enter into a supplemental rebate agreement for a
covered outpatient drug.
``(C) FFP for payments under risk-sharing value-
based payment agreements.--Federal financial
participation shall be available under this title for
any payment made by a State to a manufacturer for a
covered outpatient drug under a risk-sharing value-
based payment agreement in accordance with this
subsection, except that no Federal financial
participation shall be available for any payment made
by a State to a manufacturer under such an agreement on
and after the effective date of a disapproval of such
agreement by the Secretary.
``(D) Continued application of other provisions.--
Except as expressly provided in this subsection,
nothing in this subsection or in any regulations
promulgated under this subsection shall affect the
application of any other provision of this Act.
``(10) Appropriations.--For fiscal year 2020 and each
fiscal year thereafter, there are appropriated to the Secretary
$5,000,000 for the purpose of carrying out this subsection.
``(11) Definitions.--In this subsection:
``(A) Chief actuary.--The term `Chief Actuary'
means the Chief Actuary of the Centers for Medicare &
Medicaid Services.
``(B) Installment year.--The term `installment
year' means, with respect to a risk-sharing value-based
payment agreement, a 12-month period during which a
covered outpatient drug is administered under the
agreement.
``(C) Potentially curative treatment intended for
one-time use.--The term `potentially curative treatment
intended for one-time use' means a treatment that
consists of the administration of a covered outpatient
drug that--
``(i) is a form of gene therapy for a rare
disease, as defined by the Commissioner of Food
and Drugs, designated under section 526 of the
Federal Food, Drug, and Cosmetics Act, and
approved under section 505 of such Act or
licensed under subsection (a) or (k) of section
351 of the Public Health Service Act to treat a
serious or life-threatening disease or
condition;
``(ii) if administered in accordance with
the labeling of such drug, is expected to
result in either--
``(I) the cure of such disease or
condition; or
``(II) a reduction in the symptoms
of such disease or condition to the
extent that such disease or condition
is not expected to lead to early
mortality; and
``(iii) is expected to achieve a result
described in clause (ii), which may be achieved
over an extended period of time, after not more
than 3 administrations.
``(D) Relevant clinical parameter.--The term
`relevant clinical parameter' means, with respect to a
covered outpatient drug that is the subject of a risk-
sharing value-based payment agreement--
``(i) a clinical endpoint specified in the
drug's labeling or supported by one or more of
the compendia described in section
1861(t)(2)(B)(ii)(I) that--
``(I) is able to be measured or
evaluated on an annual basis for each
year of the agreement on an independent
basis by a provider or other entity;
and
``(II) is required to be achieved
(based on observed metrics in patient
populations) under the terms of the
agreement; or
``(ii) a surrogate endpoint (as defined in
section 507(e)(9) of the Federal Food, Drug,
and Cosmetic Act), including those developed by
patient-focused drug development tools, that--
``(I) is able to be measured or
evaluated on an annual basis for each
year of the agreement on an independent
basis by a provider or other entity;
and
``(II) has been qualified by the
Food and Drug Administration.
``(E) Risk-sharing value-based payment agreement.--
The term `risk-sharing value-based payment agreement'
means an agreement between a State plan and a
manufacturer--
``(i) for the purchase of a covered
outpatient drug of the manufacturer that is a
potentially curative treatment intended for
one-time use;
``(ii) under which payment for such drug
shall be made pursuant to an installment-based
payment structure that meets the requirements
of paragraph (3);
``(iii) which conditions payment on the
achievement of at least 2 relevant clinical
parameters (as defined in subparagraph (C));
``(iv) which provides that--
``(I) the State plan will directly
reimburse the manufacturer for the
drug; or
``(II) a third party will reimburse
the manufacture in a manner approved by
the Secretary; and
``(v) is approved by the Secretary in
accordance with paragraph (2).
``(F) Total installment year amount.--The term
`total installment year amount' means, with respect to
a risk-sharing value-based payment agreement for the
purchase of a covered outpatient drug and an
installment year, an amount equal to the product of--
``(i) the unit price of the drug charged
under the agreement; and
``(ii) the number of units of such drug
administered under the agreement during such
installment year.''.
(b) Conforming Amendments.--
(1) Section 1903(i)(10)(A) of the Social Security Act (42
U.S.C. 1396b(i)(10)(A)) is amended by striking ``or unless
section 1927(a)(3) applies'' and inserting ``, section
1927(a)(3) applies with respect to such drugs, or such drugs
are the subject of a risk-sharing value-based payment agreement
under section 1927(l)''.
(2) Section 1927(b) of the Social Security Act (42 U.S.C.
1396r-8(b)) is amended--
(A) in paragraph (1)(A), by inserting ``(except for
drugs for which payment is made by a State under a
risk-sharing value-based payment agreement under
subsection (l))'' after ``under the State plan for such
period''; and
(B) in paragraph (3)--
(i) in subparagraph (C)(i), by inserting
``or subsection (l)(2)(A)'' after
``subparagraph (A)''; and
(ii) in subparagraph (D), in the matter
preceding clause (i), by inserting ``, under
subsection (l)(2)(A),'' after ``under this
paragraph''.
SEC. 208. APPLYING MEDICAID DRUG REBATE REQUIREMENT TO DRUGS PROVIDED
AS PART OF OUTPATIENT HOSPITAL SERVICES.
(a) In General.--Section 1927(k)(3) of the Social Security Act (42
U.S.C. 1396r-8(k)(3)) is amended to read as follows:
``(3) Limiting definition.--
``(A) In general.--The term `covered outpatient
drug' does not include any drug, biological product, or
insulin provided as part of, or as incident to and in
the same setting as, any of the following (and for
which payment may be made under this title as part of
payment for the following and not as direct
reimbursement for the drug):
``(i) Inpatient hospital services.
``(ii) Hospice services.
``(iii) Dental services, except that drugs
for which the State plan authorizes direct
reimbursement to the dispensing dentist are
covered outpatient drugs.
``(iv) Physicians' services.
``(v) Outpatient hospital services.
``(vi) Nursing facility services and
services provided by an intermediate care
facility for the mentally retarded.
``(vii) Other laboratory and x-ray
services.
``(viii) Renal dialysis.
``(B) Other exclusions.--Such term also does not
include any such drug or product for which a National
Drug Code number is not required by the Food and Drug
Administration or a drug or biological used for a
medical indication which is not a medically accepted
indication.
``(C) State option.--At the option of a State, such
term may include any drug, biological product, or
insulin for which the State is the primary payer under
this title or a demonstration project concerning this
title, and that is provided on an outpatient basis as
part of, or as incident to and in the same setting as,
described in clause (iv) or (v) of subparagraph (A) and
for which payment is made as part of payment for such
services.
``(D) No effect on best price.--Any drug,
biological product, or insulin excluded from the
definition of such term as a result of this paragraph
shall be treated as a covered outpatient drug for
purposes of determining the best price (as defined in
subsection (c)(1)(C)) for such drug, biological
product, or insulin.''.
(b) Effective Date; Implementation Guidance.--
(1) In general.--The amendment made by subsection (a) shall
take effect on the date that is 1 year after the date of
enactment of this Act.
(2) Implementation and guidance.--Not later than 1 year
after the date of enactment of this Act, the Secretary of
Health and Human Services shall issue guidance and relevant
informational bulletins for States, manufacturers (as defined
in section 1927(k)(5) of the Social Security Act (42 U.S.C.
1396r-8(k)(5))), and other relevant stakeholders, including
health care providers, regarding implementation of the
amendment made by subsection (a).
TITLE III--FOOD AND DRUG ADMINISTRATION
Subtitle A--CREATES Act
SEC. 301. ACTIONS FOR DELAYS OF GENERIC DRUGS AND BIOSIMILAR BIOLOGICAL
PRODUCTS.
(a) Definitions.--In this section--
(1) the term ``commercially reasonable, market-based
terms'' means--
(A) a nondiscriminatory price for the sale of the
covered product at or below, but not greater than, the
most recent wholesale acquisition cost for the drug, as
defined in section 1847A(c)(6)(B) of the Social
Security Act (42 U.S.C. 1395w-3a(c)(6)(B));
(B) a schedule for delivery that results in the
transfer of the covered product to the eligible product
developer consistent with the timing under subsection
(b)(2)(A)(iv); and
(C) no additional conditions are imposed on the
sale of the covered product;
(2) the term ``covered product''--
(A) means--
(i) any drug approved under subsection (c)
or (j) of section 505 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355) or
biological product licensed under subsection
(a) or (k) of section 351 of the Public Health
Service Act (42 U.S.C. 262);
(ii) any combination of a drug or
biological product described in clause (i); or
(iii) when reasonably necessary to support
approval of an application under section 505 of
the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355), or section 351 of the Public
Health Service Act (42 U.S.C. 262), as
applicable, or otherwise meet the requirements
for approval under either such section, any
product, including any device, that is marketed
or intended for use with such a drug or
biological product; and
(B) does not include any drug or biological product
that appears on the drug shortage list in effect under
section 506E of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 356e), unless--
(i) the drug or biological product has been
on the drug shortage list in effect under such
section 506E continuously for more than 6
months; or
(ii) the Secretary determines that
inclusion of the drug or biological product as
a covered product is likely to contribute to
alleviating or preventing a shortage;
(3) the term ``device'' has the meaning given the term in
section 201 of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 321);
(4) the term ``eligible product developer'' means a person
that seeks to develop a product for approval pursuant to an
application for approval under subsection (b)(2) or (j) of
section 505 of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355) or for licensing pursuant to an application under
section 351(k) of the Public Health Service Act (42 U.S.C.
262(k));
(5) the term ``license holder'' means the holder of an
application approved under subsection (c) or (j) of section 505
of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or
the holder of a license under subsection (a) or (k) of section
351 of the Public Health Service Act (42 U.S.C. 262) for a
covered product;
(6) the term ``REMS'' means a risk evaluation and
mitigation strategy under section 505-1 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355-1);
(7) the term ``REMS with ETASU'' means a REMS that contains
elements to assure safe use under section 505-1(f) of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355-1(f));
(8) the term ``Secretary'' means the Secretary of Health
and Human Services;
(9) the term ``single, shared system of elements to assure
safe use'' means a single, shared system of elements to assure
safe use under section 505-1(f) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355-1(f)); and
(10) the term ``sufficient quantities'' means an amount of
a covered product that the eligible product developer
determines allows it to--
(A) conduct testing to support an application
under--
(i) subsection (b)(2) or (j) of section 505
of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355); or
(ii) section 351(k) of the Public Health
Service Act (42 U.S.C. 262(k)); and
(B) fulfill any regulatory requirements relating to
approval of such an application.
(b) Civil Action for Failure To Provide Sufficient Quantities of a
Covered Product.--
(1) In general.--An eligible product developer may bring a
civil action against the license holder for a covered product
seeking relief under this subsection in an appropriate district
court of the United States alleging that the license holder has
declined to provide sufficient quantities of the covered
product to the eligible product developer on commercially
reasonable, market-based terms.
(2) Elements.--
(A) In general.--To prevail in a civil action
brought under paragraph (1), an eligible product
developer shall prove, by a preponderance of the
evidence--
(i) that--
(I) the covered product is not
subject to a REMS with ETASU; or
(II) if the covered product is
subject to a REMS with ETASU--
(aa) the eligible product
developer has obtained a
covered product authorization
from the Secretary in
accordance with subparagraph
(B); and
(bb) the eligible product
developer has provided a copy
of the covered product
authorization to the license
holder;
(ii) that, as of the date on which the
civil action is filed, the product developer
has not obtained sufficient quantities of the
covered product on commercially reasonable,
market-based terms;
(iii) that the eligible product developer
has submitted a written request to purchase
sufficient quantities of the covered product to
the license holder and such request--
(I) was sent to a named corporate
officer of the license holder;
(II) was made by certified or
registered mail with return receipt
requested;
(III) specified an individual as
the point of contact for the license
holder to direct communications related
to the sale of the covered product to
the eligible product developer and a
means for electronic and written
communications with that individual;
and
(IV) specified an address to which
the covered product was to be shipped
upon reaching an agreement to transfer
the covered product; and
(iv) that the license holder has not
delivered to the eligible product developer
sufficient quantities of the covered product on
commercially reasonable, market-based terms--
(I) for a covered product that is
not subject to a REMS with ETASU, by
the date that is 31 days after the date
on which the license holder received
the request for the covered product;
and
(II) for a covered product that is
subject to a REMS with ETASU, by 31
days after the later of--
(aa) the date on which the
license holder received the
request for the covered
product; or
(bb) the date on which the
license holder received a copy
of the covered product
authorization issued by the
Secretary in accordance with
subparagraph (B).
(B) Authorization for covered product subject to a
rems with etasu.--
(i) Request.--An eligible product developer
may submit to the Secretary a written request
for the eligible product developer to be
authorized to obtain sufficient quantities of
an individual covered product subject to a REMS
with ETASU.
(ii) Authorization.--Not later than 120
days after the date on which a request under
clause (i) is received, the Secretary shall, by
written notice, authorize the eligible product
developer to obtain sufficient quantities of an
individual covered product subject to a REMS
with ETASU for purposes of--
(I) development and testing that
does not involve human clinical trials,
if the eligible product developer has
agreed to comply with any conditions
the Secretary determines necessary; or
(II) development and testing that
involves human clinical trials, if the
eligible product developer has--
(aa)(AA) submitted
protocols, informed consent
documents, and informational
materials for testing that
include protections that
provide safety protections
comparable to those provided by
the REMS for the covered
product; or
(BB) otherwise satisfied
the Secretary that such
protections will be provided;
and
(bb) met any other
requirements the Secretary may
establish.
(iii) Notice.--A covered product
authorization issued under this subparagraph
shall state that the provision of the covered
product by the license holder under the terms
of the authorization will not be a violation of
the REMS for the covered product.
(3) Affirmative defense.--In a civil action brought under
paragraph (1), it shall be an affirmative defense, on which the
defendant has the burden of persuasion by a preponderance of
the evidence--
(A) that, on the date on which the eligible product
developer requested to purchase sufficient quantities
of the covered product from the license holder--
(i) neither the license holder nor any of
its agents, wholesalers, or distributors was
engaged in the manufacturing or commercial
marketing of the covered product; and
(ii) neither the license holder nor any of
its agents, wholesalers, or distributors
otherwise had access to inventory of the
covered product to supply to the eligible
product developer on commercially reasonable,
market-based terms;
(B) that--
(i) the license holder sells the covered
product through agents, distributors, or
wholesalers;
(ii) the license holder has placed no
restrictions, explicit or implicit, on its
agents, distributors, or wholesalers to sell
covered products to eligible product
developers; and
(iii) the covered product can be purchased
by the eligible product developer in sufficient
quantities on commercially reasonable, market-
based terms from the agents, distributors, or
wholesalers of the license holder; or
(C) that the license holder made an offer to the
individual specified pursuant to paragraph
(2)(A)(iii)(III), by a means of communication
(electronic, written, or both) specified pursuant to
such paragraph, to sell sufficient quantities of the
covered product to the eligible product developer at
commercially reasonable market-based terms--
(i) for a covered product that is not
subject to a REMS with ETASU, by the date that
is 14 days after the date on which the license
holder received the request for the covered
product, and the eligible product developer did
not accept such offer by the date that is 7
days after the date on which the eligible
product developer received such offer from the
license holder; or
(ii) for a covered product that is subject
to a REMS with ETASU, by the date that is 20
days after the date on which the license holder
received the request for the covered product,
and the eligible product developer did not
accept such offer by the date that is 10 days
after the date on which the eligible product
developer received such offer from the license
holder.
(4) Remedies.--
(A) In general.--If an eligible product developer
prevails in a civil action brought under paragraph (1),
the court shall--
(i) order the license holder to provide to
the eligible product developer without delay
sufficient quantities of the covered product on
commercially reasonable, market-based terms;
(ii) award to the eligible product
developer reasonable attorney's fees and costs
of the civil action; and
(iii) award to the eligible product
developer a monetary amount sufficient to deter
the license holder from failing to provide
eligible product developers with sufficient
quantities of a covered product on commercially
reasonable, market-based terms, if the court
finds, by a preponderance of the evidence--
(I) that the license holder delayed
providing sufficient quantities of the
covered product to the eligible product
developer without a legitimate business
justification; or
(II) that the license holder failed
to comply with an order issued under
clause (i).
(B) Maximum monetary amount.--A monetary amount
awarded under subparagraph (A)(iii) shall not be
greater than the revenue that the license holder earned
on the covered product during the period--
(i) beginning on--
(I) for a covered product that is
not subject to a REMS with ETASU, the
date that is 31 days after the date on
which the license holder received the
request; or
(II) for a covered product that is
subject to a REMS with ETASU, the date
that is 31 days after the later of--
(aa) the date on which the
license holder received the
request; or
(bb) the date on which the
license holder received a copy
of the covered product
authorization issued by the
Secretary in accordance with
paragraph (2)(B); and
(ii) ending on the date on which the
eligible product developer received sufficient
quantities of the covered product.
(C) Avoidance of delay.--The court may issue an
order under subparagraph (A)(i) before conducting
further proceedings that may be necessary to determine
whether the eligible product developer is entitled to
an award under clause (ii) or (iii) of subparagraph
(A), or the amount of any such award.
(c) Limitation of Liability.--A license holder for a covered
product shall not be liable for any claim under Federal, State, or
local law arising out of the failure of an eligible product developer
to follow adequate safeguards to assure safe use of the covered product
during development or testing activities described in this section,
including transportation, handling, use, or disposal of the covered
product by the eligible product developer.
(d) No Violation of REMS.--Section 505-1 of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 355-1) is amended by adding at the end the
following new subsection:
``(l) Provision of Samples Not a Violation of Strategy.--The
provision of samples of a covered product to an eligible product
developer (as those terms are defined in section 301(a) of the Lower
Costs, More Cures Act of 2019) shall not be considered a violation of
the requirements of any risk evaluation and mitigation strategy that
may be in place under this section for such drug.''.
(e) Rule of Construction.--
(1) Definition.--In this subsection, the term ``antitrust
laws''--
(A) has the meaning given the term in subsection
(a) of the first section of the Clayton Act (15 U.S.C.
12); and
(B) includes section 5 of the Federal Trade
Commission Act (15 U.S.C. 45) to the extent that such
section applies to unfair methods of competition.
(2) Antitrust laws.--Nothing in this section shall be
construed to limit the operation of any provision of the
antitrust laws.
SEC. 302. REMS APPROVAL PROCESS FOR SUBSEQUENT FILERS.
Section 505-1 of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355-1), as amended by section 301, is further amended--
(1) in subsection (g)(4)(B)--
(A) in clause (i) by striking ``or'' after the
semicolon;
(B) in clause (ii) by striking the period at the
end and inserting ``; or''; and
(C) by adding at the end the following:
``(iii) accommodate different, comparable
aspects of the elements to assure safe use for
a drug that is the subject of an application
under section 505(j), and the applicable listed
drug.'';
(2) in subsection (i)(1), by striking subparagraph (C) and
inserting the following:
``(C)(i) Elements to assure safe use, if required
under subsection (f) for the listed drug, which,
subject to clause (ii), for a drug that is the subject
of an application under section 505(j) may use--
``(I) a single, shared system with the
listed drug under subsection (f); or
``(II) a different, comparable aspect of
the elements to assure safe use under
subsection (f).
``(ii) The Secretary may require a drug that is the
subject of an application under section 505(j) and the
listed drug to use a single, shared system under
subsection (f), if the Secretary determines that no
different, comparable aspect of the elements to assure
safe use could satisfy the requirements of subsection
(f).'';
(3) in subsection (i), by adding at the end the following:
``(3) Shared rems.--If the Secretary approves, in
accordance with paragraph (1)(C)(i)(II), a different,
comparable aspect of the elements to assure safe use under
subsection (f) for a drug that is the subject of an abbreviated
new drug application under section 505(j), the Secretary may
require that such different comparable aspect of the elements
to assure safe use can be used with respect to any other drug
that is the subject of an application under section 505(j) or
505(b) that references the same listed drug.''; and
(4) by adding at the end the following:
``(m) Separate REMS.--When used in this section, the terms
`different, comparable aspect of the elements to assure safe use' or
`different, comparable approved risk evaluation and mitigation
strategies' means a risk evaluation and mitigation strategy for a drug
that is the subject of an application under section 505(j) that uses
different methods or operational means than the strategy required under
subsection (a) for the applicable listed drug, or other application
under section 505(j) with the same such listed drug, but achieves the
same level of safety as such strategy.''.
SEC. 303. RULE OF CONSTRUCTION.
(a) In General.--Nothing in this subtitle, the amendments made by
this subtitle, or in section 505-1 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355-1), shall be construed as--
(1) prohibiting a license holder from providing an eligible
product developer access to a covered product in the absence of
an authorization under this subtitle; or
(2) in any way negating the applicability of a REMS with
ETASU, as otherwise required under such section 505-1, with
respect to such covered product.
(b) Definitions.--In this section, the terms ``covered product'',
``eligible product developer'', ``license holder'', and ``REMS with
ETASU'' have the meanings given such terms in section 301(a).
Subtitle B--Pay-for-Delay
SEC. 311. UNLAWFUL AGREEMENTS.
(a) Agreements Prohibited.--Subject to subsections (b) and (c), it
shall be unlawful for an NDA or BLA holder and a subsequent filer (or
for two subsequent filers) to enter into, or carry out, an agreement
resolving or settling a covered patent infringement claim on a final or
interim basis if under such agreement--
(1) a subsequent filer directly or indirectly receives from
such holder (or in the case of such an agreement between two
subsequent filers, the other subsequent filer) anything of
value, including a license; and
(2) the subsequent filer agrees to limit or forego research
on, or development, manufacturing, marketing, or sales, for any
period of time, of the covered product that is the subject of
the application described in subparagraph (A) or (B) of
subsection (g)(8).
(b) Exclusion.--It shall not be unlawful under subsection (a) if a
party to an agreement described in such subsection demonstrates by
clear and convincing evidence that the value described in subsection
(a)(1) is compensation solely for other goods or services that the
subsequent filer has promised to provide.
(c) Limitation.--Nothing in this section shall prohibit an
agreement resolving or settling a covered patent infringement claim in
which the consideration granted by the NDA or BLA holder to the
subsequent filer (or from one subsequent filer to another) as part of
the resolution or settlement includes only one or more of the
following:
(1) The right to market the covered product that is the
subject of the application described in subparagraph (A) or (B)
of subsection (g)(8) in the United States before the expiration
of--
(A) any patent that is the basis of the covered
patent infringement claim; or
(B) any patent right or other statutory exclusivity
that would prevent the marketing of such covered
product.
(2) A payment for reasonable litigation expenses not to
exceed $7,500,000 in the aggregate.
(3) A covenant not to sue on any claim that such covered
product infringes a patent.
(d) Enforcement by Federal Trade Commission.--
(1) General application.--The requirements of this section
apply, according to their terms, to an NDA or BLA holder or
subsequent filer that is--
(A) a person, partnership, or corporation over
which the Commission has authority pursuant to section
5(a)(2) of the Federal Trade Commission Act (15 U.S.C.
45(a)(2)); or
(B) a person, partnership, or corporation over
which the Commission would have authority pursuant to
such section but for the fact that such person,
partnership, or corporation is not organized to carry
on business for its own profit or that of its members.
(2) Unfair or deceptive acts or practices enforcement
authority.--
(A) In general.--A violation of this section shall
be treated as an unfair or deceptive act or practice in
violation of section 5(a)(1) of the Federal Trade
Commission Act (15 U.S.C. 45(a)(1)).
(B) Powers of commission.--Except as provided in
subparagraph (C) and paragraphs (1)(B) and (3)--
(i) the Commission shall enforce this
section in the same manner, by the same means,
and with the same jurisdiction, powers, and
duties as though all applicable terms and
provisions of the Federal Trade Commission Act
(15 U.S.C. 41 et seq.) were incorporated into
and made a part of this section; and
(ii) any NDA or BLA holder or subsequent
filer that violates this section shall be
subject to the penalties and entitled to the
privileges and immunities provided in the
Federal Trade Commission Act.
(C) Judicial review.--In the case of a cease and
desist order issued by the Commission under section 5
of the Federal Trade Commission Act (15 U.S.C. 45) for
violation of this section, a party to such order may
obtain judicial review of such order as provided in
such section 5, except that--
(i) such review may only be obtained in--
(I) the United States Court of
Appeals for the District of Columbia
Circuit;
(II) the United States Court of
Appeals for the circuit in which the
ultimate parent entity, as defined in
section 801.1(a)(3) of title 16, Code
of Federal Regulations, or any
successor thereto, of the NDA or BLA
holder (if any such holder is a party
to such order) is incorporated as of
the date that the application described
in subparagraph (A) or (B) of
subsection (g)(8) or an approved
application that is deemed to be a
license for a biological product under
section 351(k) of the Public Health
Service Act (42 U.S.C. 262(k)) pursuant
to section 7002(e)(4) of the Biologics
Price Competition and Innovation Act of
2009 (Public Law 111-148; 124 Stat.
817) is submitted to the Commissioner
of Food and Drugs; or
(III) the United States Court of
Appeals for the circuit in which the
ultimate parent entity, as so defined,
of any subsequent filer that is a party
to such order is incorporated as of the
date that the application described in
subparagraph (A) or (B) of subsection
(g)(8) is submitted to the Commissioner
of Food and Drugs; and
(ii) the petition for review shall be filed
in the court not later than 30 days after such
order is served on the party seeking review.
(3) Additional enforcement authority.--
(A) Civil penalty.--The Commission may commence a
civil action to recover a civil penalty in a district
court of the United States against any NDA or BLA
holder or subsequent filer that violates this section.
(B) Special rule for recovery of penalty if cease
and desist order issued.--
(i) In general.--If the Commission has
issued a cease and desist order in a proceeding
under section 5 of the Federal Trade Commission
Act (15 U.S.C. 45) for violation of this
section--
(I) the Commission may commence a
civil action under subparagraph (A) to
recover a civil penalty against any
party to such order at any time before
the expiration of the 1-year period
beginning on the date on which such
order becomes final under section 5(g)
of such Act (15 U.S.C. 45(g)); and
(II) in such civil action, the
findings of the Commission as to the
material facts in such proceeding shall
be conclusive, unless--
(aa) the terms of such
order expressly provide that
the Commission's findings shall
not be conclusive; or
(bb) such order became
final by reason of section
5(g)(1) of such Act (15 U.S.C.
45(g)(1)), in which case such
findings shall be conclusive if
supported by evidence.
(ii) Relationship to penalty for violation
of an order.--The penalty provided in clause
(i) for violation of this section is separate
from and in addition to any penalty that may be
incurred for violation of an order of the
Commission under section 5(l) of the Federal
Trade Commission Act (15 U.S.C. 45(l)).
(C) Amount of penalty.--
(i) In general.--The amount of a civil
penalty imposed in a civil action under
subparagraph (A) on a party to an agreement
described in subsection (a) shall be sufficient
to deter violations of this section, but in no
event greater than--
(I) if such party is the NDA or BLA
holder (or, in the case of an agreement
between two subsequent filers, the
subsequent filer who gave the value
described in subsection (a)(1)), the
greater of--
(aa) 3 times the value
received by such NDA or BLA
holder (or by such subsequent
filer) that is reasonably
attributable to the violation
of this section; or
(bb) 3 times the value
given to the subsequent filer
(or to the other subsequent
filer) reasonably attributable
to the violation of this
section; and
(II) if such party is the
subsequent filer (or, in the case of an
agreement between two subsequent
filers, the subsequent filer who
received the value described in
subsection (a)(1)), 3 times the value
received by such subsequent filer that
is reasonably attributable to the
violation of this section.
(ii) Factors for consideration.--In
determining such amount, the court shall take
into account--
(I) the nature, circumstances,
extent, and gravity of the violation;
(II) with respect to the violator,
the degree of culpability, any history
of violations, the ability to pay, any
effect on the ability to continue doing
business, profits earned by the NDA or
BLA holder (or, in the case of an
agreement between two subsequent
filers, the subsequent filer who gave
the value described in subsection
(a)(1)), compensation received by the
subsequent filer (or, in the case of an
agreement between two subsequent
filers, the subsequent filer who
received the value described in
subsection (a)(1)), and the amount of
commerce affected; and
(III) other matters that justice
requires.
(D) Injunctions and other equitable relief.--In a
civil action under subparagraph (A), the United States
district courts are empowered to grant mandatory
injunctions and such other and further equitable relief
as they deem appropriate.
(4) Remedies in addition.--Remedies provided in this
subsection are in addition to, and not in lieu of, any other
remedy provided by Federal law.
(5) Preservation of authority of commission.--Nothing in
this section shall be construed to affect any authority of the
Commission under any other provision of law.
(e) Federal Trade Commission Rulemaking.--The Commission may, in
its discretion, by rule promulgated under section 553 of title 5,
United States Code, exempt from this section certain agreements
described in subsection (a) if the Commission finds such agreements to
be in furtherance of market competition and for the benefit of
consumers.
(f) Antitrust Laws.--Nothing in this section shall modify, impair,
limit, or supersede the applicability of the antitrust laws as defined
in subsection (a) of the first section of the Clayton Act (15 U.S.C.
12(a)), and of section 5 of the Federal Trade Commission Act (15 U.S.C.
45) to the extent that such section 5 applies to unfair methods of
competition. Nothing in this section shall modify, impair, limit, or
supersede the right of a subsequent filer to assert claims or
counterclaims against any person, under the antitrust laws or other
laws relating to unfair competition.
(g) Definitions.--In this section:
(1) Agreement resolving or settling a covered patent
infringement claim.--The term ``agreement resolving or settling
a covered patent infringement claim'' means any agreement
that--
(A) resolves or settles a covered patent
infringement claim; or
(B) is contingent upon, provides for a contingent
condition for, or is otherwise related to the
resolution or settlement of a covered patent
infringement claim.
(2) Commission.--The term ``Commission'' means the Federal
Trade Commission.
(3) Covered patent infringement claim.--The term ``covered
patent infringement claim'' means an allegation made by the NDA
or BLA holder to a subsequent filer (or, in the case of an
agreement between two subsequent filers, by one subsequent
filer to another), whether or not included in a complaint filed
with a court of law, that--
(A) the submission of the application described in
subparagraph (A) or (B) of paragraph (9), or the
manufacture, use, offering for sale, sale, or
importation into the United States of a covered product
that is the subject of such an application--
(i) in the case of an agreement between an
NDA or BLA holder and a subsequent filer,
infringes any patent owned by, or exclusively
licensed to, the NDA or BLA holder of the
covered product; or
(ii) in the case of an agreement between
two subsequent filers, infringes any patent
owned by the subsequent filer; or
(B) in the case of an agreement between an NDA or
BLA holder and a subsequent filer, the covered product
to be manufactured under such application uses a
covered product as claimed in a published patent
application.
(4) Covered product.--The term ``covered product'' means a
drug (as defined in section 201(g) of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 321(g))), including a biological
product (as defined in section 351(i) of the Public Health
Service Act (42 U.S.C. 262(i))).
(5) NDA or bla holder.--The term ``NDA or BLA holder''
means--
(A) the holder of--
(i) an approved new drug application filed
under section 505(b)(1) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355(b)(1))
for a covered product; or
(ii) a biologics license application filed
under section 351(a) of the Public Health
Service Act (42 U.S.C. 262(a)) with respect to
a biological product;
(B) a person owning or controlling enforcement of
the patent on--
(i) the list published under section
505(j)(7) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355(j)(7)) in
connection with the application described in
subparagraph (A)(i); or
(ii) any list published under section 351
of the Public Health Service Act (42 U.S.C.
262) comprised of patents associated with
biologics license applications filed under
section 351(a) of such Act (42 U.S.C. 262(a));
or
(C) the predecessors, subsidiaries, divisions,
groups, and affiliates controlled by, controlling, or
under common control with any entity described in
subparagraph (A) or (B) (such control to be presumed by
direct or indirect share ownership of 50 percent or
greater), as well as the licensees, licensors,
successors, and assigns of each of the entities.
(6) Patent.--The term ``patent'' means a patent issued by
the United States Patent and Trademark Office.
(7) Statutory exclusivity.--The term ``statutory
exclusivity'' means those prohibitions on the submission or
approval of drug applications under clauses (ii) through (iv)
of section 505(c)(3)(E) (5- and 3-year exclusivity), clauses
(ii) through (iv) of section 505(j)(5)(F) (5-year and 3-year
exclusivity), section 505(j)(5)(B)(iv) (180-day exclusivity),
section 527 (orphan drug exclusivity), section 505A (pediatric
exclusivity), or section 505E (qualified infectious disease
product exclusivity) of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 355(c)(3)(E), 355(j)(5)(B)(iv), 355(j)(5)(F),
360cc, 355a, 355f), or prohibitions on the submission or
licensing of biologics license applications under section
351(k)(6) (interchangeable biological product exclusivity) or
section 351(k)(7) (biological product reference product
exclusivity) of the Public Health Service Act (42 U.S.C.
262(k)(6), (7)).
(8) Subsequent filer.--The term ``subsequent filer''
means--
(A) in the case of a drug, a party that owns or
controls an abbreviated new drug application submitted
pursuant to section 505(j) of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 355(j)) or a new drug
application submitted pursuant to section 505(b)(2) of
the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
355(b)(2)) and filed under section 505(b)(1) of such
Act (21 U.S.C. 355(b)(1)) or has the exclusive rights
to distribute the covered product that is the subject
of such application; or
(B) in the case of a biological product, a party
that owns or controls an application filed with the
Food and Drug Administration under section 351(k) of
the Public Health Service Act (42 U.S.C. 262(k)) or has
the exclusive rights to distribute the biological
product that is the subject of such application.
(h) Effective Date.--This section applies with respect to
agreements described in subsection (a) entered into on or after the
date of the enactment of this Act.
SEC. 312. NOTICE AND CERTIFICATION OF AGREEMENTS.
(a) Notice of All Agreements.--Section 1111(7) of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003 (21
U.S.C. 355 note) is amended by inserting ``or the owner of a patent for
which a claim of infringement could reasonably be asserted against any
person for making, using, offering to sell, selling, or importing into
the United States a biological product that is the subject of a
biosimilar biological product application'' before the period at the
end.
(b) Certification of Agreements.--Section 1112 of such Act (21
U.S.C. 355 note) is amended by adding at the end the following:
``(d) Certification.--The Chief Executive Officer or the company
official responsible for negotiating any agreement under subsection (a)
or (b) that is required to be filed under subsection (c) shall, within
30 days of such filing, execute and file with the Assistant Attorney
General and the Commission a certification as follows: `I declare that
the following is true, correct, and complete to the best of my
knowledge: The materials filed with the Federal Trade Commission and
the Department of Justice under section 1112 of the Medicare
Prescription Drug, Improvement, and Modernization Act of 2003, with
respect to the agreement referenced in this certification--
```(1) represent the complete, final, and exclusive
agreement between the parties;
```(2) include any ancillary agreements that are contingent
upon, provide a contingent condition for, were entered into
within 30 days of, or are otherwise related to, the referenced
agreement; and
```(3) include written descriptions of any oral agreements,
representations, commitments, or promises between the parties
that are responsive to subsection (a) or (b) of such section
1112 and have not been reduced to writing.'.''.
SEC. 313. FORFEITURE OF 180-DAY EXCLUSIVITY PERIOD.
Section 505(j)(5)(D)(i)(V) of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 355(j)(5)(D)(i)(V)) is amended by inserting ``section
311 of the Lower Costs, More Cures Act of 2019 or'' after ``that the
agreement has violated''.
SEC. 314. COMMISSION LITIGATION AUTHORITY.
Section 16(a)(2) of the Federal Trade Commission Act (15 U.S.C.
56(a)(2)) is amended--
(1) in subparagraph (D), by striking ``or'' after the
semicolon;
(2) in subparagraph (E), by inserting ``or'' after the
semicolon; and
(3) by inserting after subparagraph (E) the following:
``(F) under section 311(d)(3)(A) of the Lower
Costs, More Cures Act of 2019;''.
SEC. 315. STATUTE OF LIMITATIONS.
(a) In General.--Except as provided in subsection (b), the
Commission shall commence any administrative proceeding or civil action
to enforce section 311 of this Act not later than 6 years after the
date on which the parties to the agreement file the Notice of Agreement
as provided by section 1112(c)(2) and (d) of the Medicare Prescription
Drug, Improvement, and Modernization Act of 2003 (21 U.S.C. 355 note).
(b) Civil Action After Issuance of Cease and Desist Order.--If the
Commission has issued a cease and desist order under section 5 of the
Federal Trade Commission Act (15 U.S.C. 45) for violation of section
311 of this Act and the proceeding for the issuance of such order was
commenced within the period required by subsection (a) of this section,
such subsection does not prohibit the commencement, after such period,
of a civil action under section 311(d)(3)(A) against a party to such
order or a civil action under subsection (l) of such section 5 for
violation of such order.
Subtitle C--BLOCKING Act
SEC. 321. CHANGE CONDITIONS OF FIRST GENERIC EXCLUSIVITY TO SPUR ACCESS
AND COMPETITION.
(a) In General.--Section 505(j)(5)(B)(iv) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355(j)(5)(B)(iv)) is amended--
(1) in subclause (I), by striking ``180 days after'' and
all that follows through the period at the end and inserting
the following: ``180 days after the earlier of--
``(aa) the date of the first
commercial marketing of the drug
(including the commercial marketing of
the listed drug) by any first
applicant; or
``(bb) the applicable date
specified in subclause (III).''; and
(2) by adding at the end the following new subclause:
``(III) Applicable date.--The applicable
date specified in this subclause, with respect
to an application for a drug described in
subclause (I), is the date on which each of the
following conditions is first met:
``(aa) The approval of such an
application could be made effective,
but for the eligibility of a first
applicant for 180-day exclusivity under
this clause.
``(bb) At least 30 months have
passed since the date of submission of
an application for the drug by at least
one first applicant.
``(cc) Approval of an application
for the drug submitted by at least one
first applicant is not precluded under
clause (iii).
``(dd) No application for the drug
submitted by any first applicant is
approved at the time the conditions
under items (aa), (bb), and (cc) are
all met, regardless of whether such an
application is subsequently
approved.''.
(b) Information.--The Secretary of Health and Human Services
shall--
(1) not later than 120 days after the date of enactment of
this Act, publish, as appropriate and available, information
sufficient to allow applicants to assess whether the conditions
described in section 505(j)(5)(B)(iv)(III) of the Federal Food,
Drug, and Cosmetic Act (as added by subsection (a)) are
satisfied for all applications where the exclusivity period
under clause (iv)(I) of section 505(j)(5)(B) of the Federal
Food, Drug, and Cosmetic Act (as amended by such subsection)
has not expired; and
(2) publish updates to such information to reflect the most
recent information available to the Secretary.
Subtitle D--Purple Book
SEC. 331. PUBLIC LISTING.
Section 351(k) of the Public Health Service Act (42 U.S.C. 262(k))
is amended by adding at the end the following:
``(9) Public listing.--
``(A) In general.--
``(i) Initial publication.--Not later than
180 days after the date of enactment of the
Lower Costs, More Cures Act of 2019, the
Secretary shall publish and make available to
the public in a searchable, electronic format--
``(I) a list in alphabetical order
of the nonproprietary or proper name of
each biological product for which a
biologics license under subsection (a)
or this subsection is in effect, or
that has been deemed to be licensed
under this section pursuant to section
7002(e)(4) of the Biologics Price
Competition and Innovation Act of 2009,
as of such date of enactment;
``(II) the date of approval of the
marketing application and the
application number; and
``(III) the marketing or licensure
status of the biological product for
which a biologics license under
subsection (a) or this subsection is in
effect or that has been deemed to be
licensed under this section pursuant to
section 7002(e)(4) of the Biologics
Price Competition and Innovation Act of
2009.
``(ii) Revisions.--Every 30 days after the
publication of the first list under clause (i),
the Secretary shall revise the list to include
each biological product which has been licensed
under subsection (a) or this subsection during
the 30-day period.
``(iii) Patent information.--Not later than
30 days after a list of patents under
subsection (l)(3)(A), or a supplement to such
list under subsection (l)(7), has been provided
by the reference product sponsor to the
subsection (k) applicant respecting a
biological product included on the list
published under this subparagraph, the
reference product sponsor shall provide such
list of patents (or supplement thereto) and
their corresponding expiry dates to the
Secretary, and the Secretary shall, in
revisions made under clause (ii), include such
information for such biological product. Within
30 days of providing any subsequent or
supplemental list of patents to any subsequent
subsection (k) applicant under subsection
(l)(3)(A) or (l)(7), the reference product
sponsor shall update the information provided
to the Secretary under this clause with any
additional patents from such subsequent or
supplemental list and their corresponding
expiry dates.
``(iv) Listing of exclusivities.--For each
biological product included on the list
published under this subparagraph, the
Secretary shall specify each exclusivity period
that is applicable and has not concluded under
paragraph (6) or paragraph (7).
``(B) Withdrawal or suspension of licensure.--If
the licensing of a biological product was withdrawn or
suspended for safety, purity, or potency reasons, it
may not be published in the list under subparagraph
(A). If the withdrawal or suspension occurred after its
publication in such list, the reference product sponsor
shall notify the Secretary that--
``(i) the biological product shall be
immediately removed from such list--
``(I) for the same period as the
withdrawal or suspension; or
``(II) if the biological product
has been withdrawn from sale, for the
period of withdrawal from sale or, if
earlier, the period ending on the date
the Secretary determines that the
withdrawal from sale is not for safety,
purity, or potency reasons; and
``(ii) a notice of the removal shall be
published in the Federal Register.''.
SEC. 332. REVIEW AND REPORT ON TYPES OF INFORMATION TO BE LISTED.
Not later than 3 years after the date of enactment of this Act, the
Secretary of Health and Human Services shall--
(1) solicit public comment regarding the type of
information, if any, that should be added to or removed from
the list required by paragraph (9) of section 351(k) of the
Public Health Service Act (42 U.S.C. 262(k)), as added by
section 331; and
(2) transmit to Congress an evaluation of such comments,
including any recommendations about the types of information
that should be added to or removed from the list.
Subtitle E--Orange Book
SEC. 341. ORANGE BOOK.
(a) Submission of Patent Information for Brand Name Drugs.--
Paragraph (1) of section 505(b) of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 355(b)) is amended to read as follows:
``(b)(1) Any person may file with the Secretary an application with
respect to any drug subject to the provisions of subsection (a). Such
persons shall submit to the Secretary as part of the application--
``(A) full reports of investigations which have been made
to show whether or not such drug is safe for use and whether
such drug is effective in use;
``(B) a full list of the articles used as components of
such drug;
``(C) a full statement of the composition of such drug;
``(D) a full description of the methods used in, and the
facilities and controls used for, the manufacture, processing,
and packing of such drug;
``(E) such samples of such drug and of the articles used as
components thereof as the Secretary may require;
``(F) specimens of the labeling proposed to be used for
such drug;
``(G) any assessments required under section 505B; and
``(H) patent information, with respect to each patent for
which a claim of patent infringement could reasonably be
asserted if a person not licensed by the owner engaged in the
manufacture, use, or sale of the drug, and consistent with the
following requirements:
``(i) The applicant shall file with the application
the patent number and the expiration date of--
``(I) any patent which claims the drug for
which the applicant submitted the application
and is a drug substance (including active
ingredient) patent or a drug product (including
formulation and composition) patent; and
``(II) any patent which claims the method
of using such drug.
``(ii) If an application is filed under this
subsection for a drug and a patent of the type
described in clause (i) which claims such drug or a
method of using such drug is issued after the filing
date but before approval of the application, the
applicant shall amend the application to include such
patent information.
Upon approval of the application, the Secretary shall publish the
information submitted under subparagraph (H). The Secretary shall, in
consultation with the Director of the National Institutes of Health and
with representatives of the drug manufacturing industry, review and
develop guidance, as appropriate, on the inclusion of women and
minorities in clinical trials required by subparagraph (A).''.
(b) Conforming Changes to Requirements for Subsequent Submission of
Patent Information.--Section 505(c)(2) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355(j)(7)) is amended--
(1) by inserting after ``the patent number and the
expiration date of any patent which'' the following: ``fulfills
the criteria in subsection (b) and'';
(2) by inserting after the first sentence the following:
``Patent information that is not the type of patent information
required by subsection (b) shall not be submitted.''; and
(3) by inserting after ``could not file patent information
under subsection (b) because no patent'' the following: ``of
the type required to be submitted in subsection (b)''.
(c) Listing of Exclusivities.--Subparagraph (A) of section
505(j)(7) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
355(j)(7)) is amended by adding at the end the following:
``(iv) For each drug included on the list, the Secretary shall
specify each exclusivity period that is applicable and has not
concluded under--
``(I) clause (ii), (iii), or (iv) of subsection (c)(3)(E)
of this section;
``(II) clause (iv) or (v) of paragraph (5)(B) of this
subsection;
``(III) clause (ii), (iii), or (iv) of paragraph (5)(F) of
this subsection;
``(IV) section 505A;
``(V) section 505E; or
``(VI) section 527(a).''.
(d) Removal of Invalid Patents.--
(1) In general.--Section 505(j)(7) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355(j)(7)) is amended by
adding at the end the following:
``(D)(i) The holder of an application approved under subsection (c)
for a drug on the list shall notify within 14 days the Secretary in
writing if either of the following occurs:
``(I) The Patent Trial and Appeals Board issues a decision
from which no appeal has been or can be taken that a patent for
such drug is invalid.
``(II) A court issues a decision from which no appeal has
been or can be taken that a patent for such drug is invalid.
``(ii) The holder of an approved application shall include in any
notification under clause (i) a copy of the decision described in
subclause (I) or (II) of clause (i).
``(iii) The Secretary shall remove from the list any patent that is
determined to be invalid in a decision described in subclause (I) or
(II) of clause (i)--
``(I) promptly; but
``(II) not before the expiration of any 180-day exclusivity
period under paragraph (5)(B)(iv) that relies on a
certification described in paragraph (2)(A)(vii)(IV) that such
patent was invalid.''.
(2) Applicability.--Subparagraph (D) of section 505(j)(7)
of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
355(j)(7)), as added by paragraph (1), applies only with
respect to a decision described in such subparagraph that is
issued on or after the date of enactment of this Act.
(e) Review and Report.--Not later than one year after the date of
enactment of this Act, the Secretary of Health and Human Services,
acting through the Commissioner of Food and Drugs, shall--
(1) solicit public comment regarding the types of patent
information that should be included on the list under section
507(j)(7) of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355(j)(7)); and
(2) transmit to the Congress an evaluation of such
comments, including any recommendations about the types of
patent information that should be included on or removed from
such list.
SEC. 342. GAO REPORT TO CONGRESS.
(a) In General.--Not later than one year after the date of
enactment of this Act, the Comptroller General of the United States
(referred to in this section as the ``Comptroller General'') shall
submit to the Committee on Energy and Commerce of the House of
Representatives a report on the patents included in the list published
under section 505(j)(7) of the Federal Food, Drug and Cosmetic Act (21
U.S.C. 355(j)(7)), including an analysis and evaluation of the types of
patents included in such list and the claims such patents make about
the products they claim.
(b) Contents.--The Comptroller General shall include in the report
under subsection (a)--
(1) data on the number of--
(A) patents included in the list published under
paragraph (7) of section 505(j) of the Federal Food,
Drug and Cosmetic Act (21 U.S.C. 355(j)), that claim
the active ingredient or formulation of a drug in
combination with a device that is used for delivery of
the drug, together comprising the finished dosage form
of the drug; and
(B) claims in each patent that claim a device that
is used for the delivery of the drug, but do not claim
such device in combination with an active ingredient or
formulation of a drug;
(2) data on the date of inclusion in the list under
paragraph (7) of such section 505(j) for all patents under such
list, as compared to patents that claim a method of using the
drug in combination with a device;
(3) an analysis regarding the impact of including on the
list under paragraph (7) of such section 505(j) certain types
of patent information for drug product applicants and approved
application holders, including an analysis of whether--
(A) the listing of the patents described in
paragraph (1)(A) delayed the market entry of one or
more drugs approved under such section 505(j); and
(B) not listing the patents described in paragraph
(1)(A) would delay the market entry of one or more such
drugs; and
(4) recommendations about which kinds of patents relating
to devices described in paragraph (1)(A) should be submitted to
the Secretary of Health and Human Services for inclusion on the
list under paragraph (7) of such section 505(j) and which
patents should not be required to be so submitted.
Subtitle F--Advancing Education on Biosimilars
SEC. 351. EDUCATION ON BIOLOGICAL PRODUCTS.
(a) Website; Continuing Education.--Subpart 1 of part F of title
III of the Public Health Service Act (42 U.S.C. 262 et seq.) is amended
by adding at the end the following:
``SEC. 352A. EDUCATION ON BIOLOGICAL PRODUCTS.
``(a) Internet Website.--
``(1) In general.--The Secretary shall maintain and operate
an internet website to provide educational materials for health
care providers, patients, and caregivers, regarding the meaning
of the terms, and the standards for review and licensing of,
biological products, including biosimilar biological products
and interchangeable biosimilar biological products.
``(2) Content.--Educational materials provided under
paragraph (1) may include--
``(A) explanations of key statutory and regulatory
terms, including `biosimilar' and `interchangeable',
and clarification regarding the use of interchangeable
biosimilar biological products;
``(B) information related to development programs
for biological products, including biosimilar
biological products and interchangeable biosimilar
biological products and relevant clinical
considerations for prescribers, which may include, as
appropriate and applicable, information related to the
comparability of such biological products;
``(C) an explanation of the process for reporting
adverse events for biological products, including
biosimilar biological products and interchangeable
biosimilar biological products; and
``(D) an explanation of the relationship between
biosimilar biological products and interchangeable
biosimilar biological products licensed under section
351(k) and reference products (as defined in section
351(i)), including the standards for review and
licensing of each such type of biological product.
``(3) Format.--The educational materials provided under
paragraph (1) may be--
``(A) in formats such as webinars, continuing
medical education modules, videos, fact sheets,
infographics, stakeholder toolkits, or other formats as
appropriate and applicable; and
``(B) tailored for the unique needs of health care
providers, patients, caregivers, and other audiences,
as the Secretary determines appropriate.
``(4) Other information.--In addition to the information
described in paragraph (2), the Secretary shall continue to
publish the following information:
``(A) The action package of each biological product
licensed under subsection (a) or (k).
``(B) The summary review of each biological product
licensed under subsection (a) or (k).
``(5) Confidential and trade secret information.--This
subsection does not authorize the disclosure of any trade
secret, confidential commercial or financial information, or
other matter described in section 552(b) of title 5.
``(b) Continuing Education.--The Secretary shall advance education
and awareness among health care providers regarding biological
products, including biosimilar biological products and interchangeable
biosimilar biological products, as appropriate, including by developing
or improving continuing education programs that advance the education
of such providers on the prescribing of, and relevant clinical
considerations with respect to, biological products, including
biosimilar biological products and interchangeable biosimilar
biological products.''.
(b) Application Under the Medicare Merit-Based Incentive Payment
System.--Section 1848(q)(5)(C) of the Social Security Act (42 U.S.C.
1395w-4(q)(5)(C)) is amended by adding at the end the following new
clause:
``(iv) Clinical medical education program
on biosimilar biological products.--Completion
of a clinical medical education program
developed or improved under section 352A(b) of
the Public Health Service Act by a MIPS
eligible professional during a performance
period shall earn such eligible professional
one-half of the highest potential score for the
performance category described in paragraph
(2)(A)(iii) for such performance period. A MIPS
eligible professional may only count the
completion of such a program for purposes of
such category one time during the eligible
professional's lifetime.''.
Subtitle G--Streamlining Transition of Biological Products
SEC. 361. STREAMLINING THE TRANSITION OF BIOLOGICAL PRODUCTS.
Section 7002(e)(4) of the Biologics Price Competition and
Innovation Act of 2009 (Public Law 111-148) is amended--
(1) by striking ``An approved application'' and inserting
the following:
``(A) In general.--An approved application'';
(2) by adding at the end the following:
``(B) Treatment of certain applications.--
``(i) In general.--With respect to an
application for a biological product submitted
under subsection (b) or (j) of section 505 of
the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355) that is filed not later than March
23, 2019, the Secretary shall continue to
review such application under such section 505,
even if such review continues after March 23,
2020.
``(ii) Effect on listed drugs.--Only for
purposes of carrying out clause (i), with
respect to any applicable listed drug with
respect to such application, the following
shall apply:
``(I) Any drug that is a biological
product that has been deemed licensed
under section 351 of the Public Health
Service Act (42 U.S.C. 262) pursuant to
subparagraph (A) and that is referenced
in an application described in clause
(i), shall continue to be identified as
a listed drug on the list published
pursuant to section 505(j)(7) of the
Federal Food, Drug, and Cosmetic Act,
and the information for such drug on
such list shall not be revised after
March 20, 2020, until--
``(aa) such drug is removed
from such list in accordance
with subclause (III) or
subparagraph (C) of such
section 505(j)(7); or
``(bb) this subparagraph no
longer has force or effect.
``(II) Any drug that is a
biological product that has been deemed
licensed under section 351 of the
Public Health Service Act (42 U.S.C.
262) pursuant to subparagraph (A) and
that is referenced in an application
described in clause (i) shall be
subject only to requirements applicable
to biological products licensed under
such section.
``(III) Upon approval under
subsection (c) or (j) of section 505 of
the Federal Food, Drug, and Cosmetic
Act of an application described in
clause (i), the Secretary shall remove
from the list published pursuant to
section 505(j)(7) of the Federal Food,
Drug, and Cosmetic Act any listed drug
that is a biological product that has
been deemed licensed under section 351
of the Public Health Service Act
pursuant to subparagraph (A) and that
is referenced in such approved
application, unless such listed drug is
referenced in one or more additional
applications described in clause (i).
``(iii) Deemed licensure.--Upon approval of
an application described in clause (i), such
approved application shall be deemed to be a
license for the biological product under
section 351 of the Public Health Service Act,
pursuant to subparagraph (A), and any period of
exclusivity, as applicable, shall be determined
in accordance with such section.
``(iv) Rule of construction.--
``(I) Application of certain
provisions.--
``(aa) Patent certification
or statement.--An application
described in clause (i) shall
contain a patent certification
or statement described in, as
applicable, section 505(b)(2)
of the Federal Food, Drug, and
Cosmetic Act or clauses (vii)
and (viii) of section
505(j)(2)(A) of such Act and,
with respect to any listed drug
referenced in such application,
comply with related
requirements concerning any
timely filed patent information
listed pursuant to section
505(j)(7).
``(bb) Date of approval.--
The earliest possible date on
which any pending application
described in clause (i) may be
approved shall be determined
based on--
``(AA) the last
expiration date of any
applicable period of
exclusivity that would
prevent such approval
and that is described
in section
505(c)(3)(E),
505(j)(5)(B)(iv),
505(j)(5)(F), 505A,
505E, or 527 of the
Federal Food, Drug, and
Cosmetic Act; and
``(BB) if the
application was
submitted under section
505(b)(2) of the
Federal Food, Drug, and
Cosmetic Act and
references any listed
drug, the last
applicable date
determined under
subparagraph (A), (B),
or (C) of section
505(c)(3) of such Act,
or, if the application
was submitted under
section 505(j) of such
Act, the last
applicable date
determined under clause
(i), (ii), or (iii) of
section 505(j)(5)(B).
``(II) Rule of construction with
respect to exclusivity.--Nothing in
this subparagraph shall be construed to
affect section 351(k)(7)(D) of the
Public Health Service Act.
``(v) Authorized disclosure.--The Secretary
may continue to review an application after
March 23, 2020, pursuant to clause (i), and
continue to identify any applicable listed drug
pursuant to clause (ii) on the list published
pursuant to section 505(j)(7) of the Federal
Food, Drug, and Cosmetic Act, even if such
review or listing may reveal the existence of
such application and the identity of any listed
drug for which the investigations described in
section 505(b)(1)(A) of the Federal Food, Drug,
and Cosmetic Act are relied upon by the
applicant for approval of the pending
application. Nothing in this subparagraph shall
be construed as authorizing the Secretary to
disclose any other information that is a trade
secret or confidential information described in
section 552(b)(4) of title 5, United States
Code.
``(vi) Sunset.--Beginning on October 1,
2022, this subparagraph shall have no force or
effect and any applications described in clause
(i) that have not been approved shall be deemed
withdrawn.''.
Subtitle H--Over-the-Counter Monograph Safety, Innovation, and Reform
SEC. 370. SHORT TITLE; REFERENCES IN SUBTITLE.
(a) Short Title.--This subtitle may be cited as the ``Over-the-
Counter Monograph Safety, Innovation, and Reform Act of 2019''.
(b) References.--Except as otherwise specified, any reference to
``this Act'' contained in this subtitle shall be treated as referring
only to the provisions of this subtitle.
PART 1--OTC DRUG REVIEW
SEC. 371. REGULATION OF CERTAIN NONPRESCRIPTION DRUGS THAT ARE MARKETED
WITHOUT AN APPROVED DRUG APPLICATION.
(a) In General.--Chapter V of the Federal Food, Drug, and Cosmetic
Act is amended by inserting after section 505F of such Act (21 U.S.C.
355g) the following:
``SEC. 505G. REGULATION OF CERTAIN NONPRESCRIPTION DRUGS THAT ARE
MARKETED WITHOUT AN APPROVED DRUG APPLICATION.
``(a) Nonprescription Drugs Marketed Without an Approved
Application.--Nonprescription drugs marketed without an approved drug
application under section 505, as of the date of the enactment of this
section, shall be treated in accordance with this subsection.
``(1) Drugs subject to a final monograph; category i drugs
subject to a tentative final monograph.--A drug is deemed to be
generally recognized as safe and effective under section
201(p)(1), not a new drug under section 201(p), and not subject
to section 503(b)(1), if--
``(A) the drug is--
``(i) in conformity with the requirements
for nonprescription use of a final monograph
issued under part 330 of title 21, Code of
Federal Regulations (except as provided in
paragraph (2)), the general requirements for
nonprescription drugs, and conditions or
requirements under subsections (b), (c), and
(k); and
``(ii) except as permitted by an order
issued under subsection (b) or, in the case of
a minor change in the drug, in conformity with
an order issued under subsection (c), in a
dosage form that, immediately prior to the date
of the enactment of this section, has been used
to a material extent and for a material time
under section 201(p)(2); or
``(B) the drug is--
``(i) classified in category I for safety
and effectiveness under a tentative final
monograph that is the most recently applicable
proposal or determination issued under part 330
of title 21, Code of Federal Regulations;
``(ii) in conformity with the proposed
requirements for nonprescription use of such
tentative final monograph, any applicable
subsequent determination by the Secretary, the
general requirements for nonprescription drugs,
and conditions or requirements under
subsections (b), (c), and (k); and
``(iii) except as permitted by an order
issued under subsection (b) or, in the case of
a minor change in the drug, in conformity with
an order issued under subsection (c), in a
dosage form that, immediately prior to the date
of the enactment of this section, has been used
to a material extent and for a material time
under section 201(p)(2).
``(2) Treatment of sunscreen drugs.--With respect to
sunscreen drugs subject to this section, the applicable
requirements in terms of conformity with a final monograph, for
purposes of paragraph (1)(A)(i), shall be the requirements
specified in part 352 of title 21, Code of Federal Regulations,
as published on May 21, 1999, beginning on page 27687 of volume
64 of the Federal Register, except that the applicable
requirements governing effectiveness and labeling shall be
those specified in section 201.327 of title 21, Code of Federal
Regulations.
``(3) Category iii drugs subject to a tentative final
monograph; category i drugs subject to proposed monograph or
advance notice of proposed rulemaking.--A drug that is not
described in paragraph (1), (2), or (4) is not required to be
the subject of an application approved under section 505, and
is not subject to section 503(b)(1), if--
``(A) the drug is--
``(i) classified in category III for safety
or effectiveness in the preamble of a proposed
rule establishing a tentative final monograph
that is the most recently applicable proposal
or determination for such drug issued under
part 330 of title 21, Code of Federal
Regulations;
``(ii) in conformity with--
``(I) the conditions of use,
including indication and dosage
strength, if any, described for such
category III drug in such preamble or
in an applicable subsequent proposed
rule;
``(II) the proposed requirements
for drugs classified in such tentative
final monograph in category I in the
most recently proposed rule
establishing requirements related to
such tentative final monograph and in
any final rule establishing
requirements that are applicable to the
drug; and
``(III) the general requirements
for nonprescription drugs and
conditions or requirements under
subsection (b) or (k); and
``(iii) in a dosage form that, immediately
prior to the date of the enactment of this
section, had been used to a material extent and
for a material time under section 201(p)(2); or
``(B) the drug is--
``(i) classified in category I for safety
and effectiveness under a proposed monograph or
advance notice of proposed rulemaking that is
the most recently applicable proposal or
determination for such drug issued under part
330 of title 21, Code of Federal Regulations;
``(ii) in conformity with the requirements
for nonprescription use of such proposed
monograph or advance notice of proposed
rulemaking, any applicable subsequent
determination by the Secretary, the general
requirements for nonprescription drugs, and
conditions or requirements under subsection (b)
or (k); and
``(iii) in a dosage form that, immediately
prior to the date of the enactment of this
section, has been used to a material extent and
for a material time under section 201(p)(2).
``(4) Category ii drugs deemed new drugs.--A drug that is
classified in category II for safety or effectiveness under a
tentative final monograph or that is subject to a determination
to be not generally recognized as safe and effective in a
proposed rule that is the most recently applicable proposal
issued under part 330 of title 21, Code of Federal Regulations,
shall be deemed to be a new drug under section 201(p),
misbranded under section 502(ee), and subject to the
requirement for an approved new drug application under section
505 beginning on the day that is 180 calendar days after the
date of the enactment of this section, unless, before such day,
the Secretary determines that it is in the interest of public
health to extend the period during which the drug may be
marketed without such an approved new drug application.
``(5) Drugs not grase deemed new drugs.--A drug that the
Secretary has determined not to be generally recognized as safe
and effective under section 201(p)(1) under a final
determination issued under part 330 of title 21, Code of
Federal Regulations, shall be deemed to be a new drug under
section 201(p), misbranded under section 502(ee), and subject
to the requirement for an approved new drug application under
section 505.
``(6) Other drugs deemed new drugs.--Except as provided in
subsection (m), a drug is deemed to be a new drug under section
201(p) and misbranded under section 502(ee) if the drug--
``(A) is not subject to section 503(b)(1); and
``(B) is not described in paragraph (1), (2), (3),
(4), or (5), or subsection (b)(1)(B).
``(b) Administrative Orders.--
``(1) In general.--
``(A) Determination.--The Secretary may, on the
initiative of the Secretary or at the request of one or
more requestors, issue an administrative order
determining whether there are conditions under which a
specific drug, a class of drugs, or a combination of
drugs, is determined to be--
``(i) not subject to section 503(b)(1); and
``(ii) generally recognized as safe and
effective under section 201(p)(1).
``(B) Effect.--A drug or combination of drugs shall
be deemed to not require approval under section 505 if
such drug or combination of drugs--
``(i) is determined by the Secretary to
meet the conditions specified in clauses (i)
and (ii) of subparagraph (A);
``(ii) is marketed in conformity with an
administrative order under this subsection;
``(iii) meets the general requirements for
nonprescription drugs; and
``(iv) meets the requirements under
subsections (c) and (k).
``(C) Standard.--The Secretary shall find that a
drug is not generally recognized as safe and effective
under section 201(p)(1) if--
``(i) the evidence shows that the drug is
not generally recognized as safe and effective
under section 201(p)(1); or
``(ii) the evidence is inadequate to show
that the drug is generally recognized as safe
and effective under section 201(p)(1).
``(2) Administrative orders initiated by the secretary.--
``(A) In general.--In issuing an administrative
order under paragraph (1) upon the Secretary's
initiative, the Secretary shall--
``(i) make reasonable efforts to notify
informally, not later than 2 business days
before the issuance of the proposed order, the
sponsors of drugs who have a listing in effect
under section 510(j) for the drugs or
combination of drugs that will be subject to
the administrative order;
``(ii) after any such reasonable efforts of
notification--
``(I) issue a proposed
administrative order by publishing it
on the website of the Food and Drug
Administration and include in such
order the reasons for the issuance of
such order; and
``(II) publish a notice of
availability of such proposed order in
the Federal Register;
``(iii) except as provided in subparagraph
(B), provide for a public comment period with
respect to such proposed order of not less than
45 calendar days; and
``(iv) if, after completion of the
proceedings specified in clauses (i) through
(iii), the Secretary determines that it is
appropriate to issue a final administrative
order--
``(I) issue the final
administrative order, together with a
detailed statement of reasons, which
order shall not take effect until the
time for requesting judicial review
under paragraph (3)(D)(ii) has expired;
``(II) publish a notice of such
final administrative order in the
Federal Register;
``(III) afford requestors of drugs
that will be subject to such order the
opportunity for formal dispute
resolution up to the level of the
Director of the Center for Drug
Evaluation and Research, which
initially must be requested within 45
calendar days of the issuance of the
order, and, for subsequent levels of
appeal, within 30 calendar days of the
prior decision; and
``(IV) except with respect to drugs
described in paragraph (3)(B), upon
completion of the formal dispute
resolution procedure, inform the
persons which sought such dispute
resolution of their right to request a
hearing.
``(B) Exceptions.--When issuing an administrative
order under paragraph (1) on the Secretary's initiative
proposing to determine that a drug described in
subsection (a)(3) is not generally recognized as safe
and effective under section 201(p)(1), the Secretary
shall follow the procedures in subparagraph (A), except
that--
``(i) the proposed order shall include
notice of--
``(I) the general categories of
data the Secretary has determined
necessary to establish that the drug is
generally recognized as safe and
effective under section 201(p)(1); and
``(II) the format for submissions
by interested persons;
``(ii) the Secretary shall provide for a
public comment period of no less than 180
calendar days with respect to such proposed
order, except when the Secretary determines,
for good cause, that a shorter period is in the
interest of public health; and
``(iii) any person who submits data in such
comment period shall include a certification
that the person has submitted all evidence
created, obtained, or received by that person
that is both within the categories of data
identified in the proposed order and relevant
to a determination as to whether the drug is
generally recognized as safe and effective
under section 201(p)(1).
``(3) Hearings; judicial review.--
``(A) In general.--Only a person who participated
in each stage of formal dispute resolution under
subclause (III) of paragraph (2)(A)(iv) of an
administrative order with respect to a drug may request
a hearing concerning a final administrative order
issued under such paragraph with respect to such drug.
If a hearing is sought, such person must submit a
request for a hearing, which shall be based solely on
information in the administrative record, to the
Secretary not later than 30 calendar days after
receiving notice of the final decision of the formal
dispute resolution procedure.
``(B) No hearing required with respect to orders
relating to certain drugs.--
``(i) In general.--The Secretary shall not
be required to provide notice and an
opportunity for a hearing pursuant to paragraph
(2)(A)(iv) if the final administrative order
involved relates to a drug--
``(I) that is described in
subsection (a)(3)(A); and
``(II) with respect to which no
human or non-human data studies
relevant to the safety or effectiveness
of such drug have been submitted to the
administrative record since the
issuance of the most recent tentative
final monograph relating to such drug.
``(ii) Human data studies and non-human
data defined.--In this subparagraph:
``(I) The term `human data studies'
means clinical trials of safety or
effectiveness (including actual use
studies), pharmacokinetics studies, or
bioavailability studies.
``(II) The term `non-human data'
means data from testing other than with
human subjects which provides
information concerning safety or
effectiveness.
``(C) Hearing procedures.--
``(i) Denial of request for hearing.--If
the Secretary determines that information
submitted in a request for a hearing under
subparagraph (A) with respect to a final
administrative order issued under paragraph
(2)(A)(iv) does not identify the existence of a
genuine and substantial question of material
fact, the Secretary may deny such request. In
making such a determination, the Secretary may
consider only information and data that are
based on relevant and reliable scientific
principles and methodologies.
``(ii) Single hearing for multiple related
requests.--If more than one request for a
hearing is submitted with respect to the same
administrative order under subparagraph (A),
the Secretary may direct that a single hearing
be conducted in which all persons whose hearing
requests were granted may participate.
``(iii) Presiding officer.--The presiding
officer of a hearing requested under
subparagraph (A) shall--
``(I) be designated by the
Secretary;
``(II) not be an employee of the
Center for Drug Evaluation and
Research; and
``(III) not have been previously
involved in the development of the
administrative order involved or
proceedings relating to that
administrative order.
``(iv) Rights of parties to hearing.--The
parties to a hearing requested under
subparagraph (A) shall have the right to
present testimony, including testimony of
expert witnesses, and to cross-examine
witnesses presented by other parties. Where
appropriate, the presiding officer may require
that cross-examination by parties representing
substantially the same interests be
consolidated to promote efficiency and avoid
duplication.
``(v) Final decision.--
``(I) At the conclusion of a
hearing requested under subparagraph
(A), the presiding officer of the
hearing shall issue a decision
containing findings of fact and
conclusions of law. The decision of the
presiding officer shall be final.
``(II) The final decision may not
take effect until the period under
subparagraph (D)(ii) for submitting a
request for judicial review of such
decision expires.
``(D) Judicial review of final administrative
order.--
``(i) In general.--The procedures described
in section 505(h) shall apply with respect to
judicial review of final administrative orders
issued under this subsection in the same manner
and to the same extent as such section applies
to an order described in such section except
that the judicial review shall be taken by
filing in an appropriate district court of the
United States in lieu of the appellate courts
specified in such section.
``(ii) Period to submit a request for
judicial review.--A person eligible to request
a hearing under this paragraph and seeking
judicial review of a final administrative order
issued under this subsection shall file such
request for judicial review not later than 60
calendar days after the latest of--
``(I) the date on which notice of
such order is published;
``(II) the date on which a hearing
with respect to such order is denied
under subparagraph (B) or (C)(i);
``(III) the date on which a final
decision is made following a hearing
under subparagraph (C)(v); or
``(IV) if no hearing is requested,
the date on which the time for
requesting a hearing expires.
``(4) Expedited procedure with respect to administrative
orders initiated by the secretary.--
``(A) Imminent hazard to the public health.--
``(i) In general.--In the case of a
determination by the Secretary that a drug,
class of drugs, or combination of drugs subject
to this section poses an imminent hazard to the
public health, the Secretary, after first
making reasonable efforts to notify, not later
than 48 hours before issuance of such order
under this subparagraph, sponsors who have a
listing in effect under section 510(j) for such
drug or combination of drugs--
``(I) may issue an interim final
administrative order for such drug,
class of drugs, or combination of drugs
under paragraph (1), together with a
detailed statement of the reasons for
such order;
``(II) shall publish in the Federal
Register a notice of availability of
any such order; and
``(III) shall provide for a public
comment period of at least 45 calendar
days with respect to such interim final
order.
``(ii) Nondelegation.--The Secretary may
not delegate the authority to issue an interim
final administrative order under this
subparagraph.
``(B) Safety labeling changes.--
``(i) In general.--In the case of a
determination by the Secretary that a change in
the labeling of a drug, class of drugs, or
combination of drugs subject to this section is
reasonably expected to mitigate a significant
or unreasonable risk of a serious adverse event
associated with use of the drug, the Secretary
may--
``(I) make reasonable efforts to
notify informally, not later than 48
hours before the issuance of the
interim final order, the sponsors of
drugs who have a listing in effect
under section 510(j) for such drug or
combination of drugs;
``(II) after reasonable efforts of
notification, issue an interim final
administrative order in accordance with
paragraph (1) to require such change,
together with a detailed statement of
the reasons for such order;
``(III) publish in the Federal
Register a notice of availability of
such order; and
``(IV) provide for a public comment
period of at least 45 calendar days
with respect to such interim final
order.
``(ii) Content of order.--An interim final
order issued under this subparagraph with
respect to the labeling of a drug may provide
for new warnings and other information required
for safe use of the drug.
``(C) Effective date.--An order under subparagraph
(A) or (B) shall take effect on a date specified by the
Secretary.
``(D) Final order.--After the completion of the
proceedings in subparagraph (A) or (B), the Secretary
shall--
``(i) issue a final order in accordance
with paragraph (1);
``(ii) publish a notice of availability of
such final administrative order in the Federal
Register; and
``(iii) afford sponsors of such drugs that
will be subject to such an order the
opportunity for formal dispute resolution up to
the level of the Director of the Center for
Drug Evaluation and Research, which must
initially be within 45 calendar days of the
issuance of the order, and for subsequent
levels of appeal, within 30 calendar days of
the prior decision.
``(E) Hearings.--A sponsor of a drug subject to a
final order issued under subparagraph (D) and that
participated in each stage of formal dispute resolution
under clause (iii) of such subparagraph may request a
hearing on such order. The provisions of subparagraphs
(A), (B), and (C) of paragraph (3), other than
paragraph (3)(C)(v)(II), shall apply with respect to a
hearing on such order in the same manner and to the
same extent as such provisions apply with respect to a
hearing on an administrative order issued under
paragraph (2)(A)(iv).
``(F) Timing.--
``(i) Final order and hearing.--The
Secretary shall--
``(I) not later than 6 months after
the date on which the comment period
closes under subparagraph (A) or (B),
issue a final order in accordance with
paragraph (1); and
``(II) not later than 12 months
after the date on which such final
order is issued, complete any hearing
under subparagraph (E).
``(ii) Dispute resolution request.--The
Secretary shall specify in an interim final
order issued under subparagraph (A) or (B) such
shorter periods for requesting dispute
resolution under subparagraph (D)(iii) as are
necessary to meet the requirements of this
subparagraph.
``(G) Judicial review.--A final order issued
pursuant to subparagraph (F) shall be subject to
judicial review in accordance with paragraph (3)(D).
``(5) Administrative order initiated at the request of a
requestor.--
``(A) In general.--In issuing an administrative
order under paragraph (1) at the request of a requestor
with respect to certain drugs, classes of drugs, or
combinations of drugs--
``(i) the Secretary shall, after receiving
a request under this subparagraph, determine
whether the request is sufficiently complete
and formatted to permit a substantive review;
``(ii) if the Secretary determines that the
request is sufficiently complete and formatted
to permit a substantive review, the Secretary
shall--
``(I) file the request; and
``(II) initiate proceedings with
respect to issuing an administrative
order in accordance with paragraphs (2)
and (3); and
``(iii) except as provided in paragraph
(6), if the Secretary determines that a request
does not meet the requirements for filing or is
not sufficiently complete and formatted to
permit a substantive review, the requestor may
demand that the request be filed over protest,
and the Secretary shall initiate proceedings to
review the request in accordance with paragraph
(2)(A).
``(B) Request to initiate proceedings.--
``(i) In general.--A requestor seeking an
administrative order under paragraph (1) with
respect to certain drugs, classes of drugs, or
combinations of drugs, shall submit to the
Secretary a request to initiate proceedings for
such order in the form and manner as specified
by the Secretary. Such requestor may submit a
request under this subparagraph for the
issuance of an administrative order--
``(I) determining whether a drug is
generally recognized as safe and
effective under section 201(p)(1),
exempt from section 503(b)(1), and not
required to be the subject of an
approved application under section 505;
or
``(II) determining whether a change
to a condition of use of a drug is
generally recognized as safe and
effective under section 201(p)(1),
exempt from section 503(b)(1), and not
required to be the subject of an
approved application under section 505,
if, absent such a changed condition of
use, such drug is--
``(aa) generally recognized
as safe and effective under
section 201(p)(1) in accordance
with subsection (a)(1), (a)(2),
or an order under this
subsection; or
``(bb) subject to
subsection (a)(3), but only if
such requestor initiates such
request in conjunction with a
request for the Secretary to
determine whether such drug is
generally recognized as safe
and effective under section
201(p)(1), which is filed by
the Secretary under
subparagraph (A)(ii).
``(ii) Exception.--The Secretary is not
required to complete review of a request for a
change described in clause (i)(II) if the
Secretary determines that there is an
inadequate basis to find the drug is generally
recognized as safe and effective under section
201(p)(1) under paragraph (1) and issues a
final order announcing that determination.
``(iii) Withdrawal.--The requestor may
withdraw a request under this paragraph,
according to the procedures set forth pursuant
to subsection (d)(2)(B). Notwithstanding any
other provision of this section, if such
request is withdrawn, the Secretary may cease
proceedings under this subparagraph.
``(C) Exclusivity.--
``(i) In general.--A final administrative
order issued in response to a request under
this section shall have the effect of
authorizing solely the order requestor (or the
licensees, assignees, or successors in interest
of such requestor with respect to the subject
of such order), for a period of 18 months
following the effective date of such final
order and beginning on the date the requestor
may lawfully market such drugs pursuant to the
order, to market drugs--
``(I) incorporating changes
described in clause (ii); and
``(II) subject to the limitations
under clause (iv).
``(ii) Changes described.--A change
described in this clause is a change subject to
an order specified in clause (i), which--
``(I) provides for a drug to
contain an active ingredient (including
any ester or salt of the active
ingredient) not previously incorporated
in a drug described in clause (iii); or
``(II) provides for a change in the
conditions of use of a drug, for which
new human data studies conducted or
sponsored by the requestor (or for
which the requestor has an exclusive
right of reference) were essential to
the issuance of such order.
``(iii) Drugs described.--The drugs
described in this clause are drugs--
``(I) specified in subsection
(a)(1), (a)(2), or (a)(3);
``(II) subject to a final order
issued under this section;
``(III) subject to a final
sunscreen order (as defined in section
586(2)(A)); or
``(IV) described in subsection
(m)(1), other than drugs subject to an
active enforcement action under chapter
III of this Act.
``(iv) Limitations on exclusivity.--
``(I) In general.--Only one 18-
month period under this subparagraph
shall be granted, under each order
described in clause (i), with respect
to changes (to the drug subject to such
order) which are either--
``(aa) changes described in
clause (ii)(I), relating to
active ingredients; or
``(bb) changes described in
clause (ii)(II), relating to
conditions of use.
``(II) No exclusivity allowed.--No
exclusivity shall apply to changes to a
drug which are--
``(aa) the subject of a
Tier 2 OTC monograph order
request (as defined in section
744L);
``(bb) safety-related
changes, as defined by the
Secretary, or any other changes
the Secretary considers
necessary to assure safe use;
or
``(cc) changes related to
methods of testing safety or
efficacy.
``(v) New human data studies defined.--In
this subparagraph, the term `new human data
studies' means clinical trials of safety or
effectiveness (including actual use studies),
pharmacokinetics studies, or bioavailability
studies, the results of which--
``(I) have not been relied on by
the Secretary to support--
``(aa) a proposed or final
determination that a drug
described in subclause (I),
(II), or (III) of clause (iii)
is generally recognized as safe
and effective under section
201(p)(1); or
``(bb) approval of a drug
that was approved under section
505; and
``(II) do not duplicate the results
of another study that was relied on by
the Secretary to support--
``(aa) a proposed or final
determination that a drug
described in subclause (I),
(II), or (III) of clause (iii)
is generally recognized as safe
and effective under section
201(p)(1); or
``(bb) approval of a drug
that was approved under section
505.
``(6) Information regarding safe nonprescription marketing
and use as condition for filing a generally recognized as safe
and effective request.--
``(A) In general.--In response to a request under
this section that a drug described in subparagraph (B)
be generally recognized as safe and effective, the
Secretary--
``(i) may file such request, if the request
includes information specified under
subparagraph (C) with respect to safe
nonprescription marketing and use of such drug;
or
``(ii) if the request fails to include
information specified under subparagraph (C),
shall refuse to file such request and require
that nonprescription marketing of the drug be
pursuant to a new drug application as described
in subparagraph (D).
``(B) Drug described.--A drug described in this
subparagraph is a nonprescription drug which contains
an active ingredient not previously incorporated in a
drug--
``(i) specified in subsection (a)(1),
(a)(2), or (a)(3);
``(ii) subject to a final order under this
section; or
``(iii) subject to a final sunscreen order
(as defined in section 586(2)(A)).
``(C) Information demonstrating prima facie safe
nonprescription marketing and use.--Information
specified in this subparagraph, with respect to a
request described in subparagraph (A)(i), is--
``(i) information sufficient for a prima
facie demonstration that the drug subject to
such request has a verifiable history of being
marketed and safely used by consumers in the
United States as a nonprescription drug under
comparable conditions of use;
``(ii) if the drug has not been previously
marketed in the United States as a
nonprescription drug, information sufficient
for a prima facie demonstration that the drug
was marketed and safely used under comparable
conditions of marketing and use in a country
listed in section 802(b)(1)(A) or designated by
the Secretary in accordance with section
802(b)(1)(B)--
``(I) for such period as needed to
provide reasonable assurances
concerning the safe nonprescription use
of the drug; and
``(II) during such time was subject
to sufficient monitoring by a
regulatory body considered acceptable
by the Secretary for such monitoring
purposes, including for adverse events
associated with nonprescription use of
the drug; or
``(iii) if the Secretary determines that
information described in clause (i) or (ii) is
not needed to provide a prima facie
demonstration that the drug can be safely
marketed and used as a nonprescription drug,
such other information the Secretary determines
is sufficient for such purposes.
``(D) Marketing pursuant to new drug application.--
In the case of a request described in subparagraph
(A)(ii), the drug subject to such request may be
resubmitted for filing only if--
``(i) the drug is marketed as a
nonprescription drug, under conditions of use
comparable to the conditions specified in the
request, for such period as the Secretary
determines appropriate (not to exceed 5
consecutive years) pursuant to an application
approved under section 505; and
``(ii) during such period, 1,000,000 retail
packages of the drug, or an equivalent quantity
as determined by the Secretary, were
distributed for retail sale, as determined in
such manner as the Secretary finds appropriate.
``(E) Rule of application.--Except in the case of a
request involving a drug described in section 586(9),
as in effect on January 1, 2017, if the Secretary
refuses to file a request under this paragraph, the
requestor may not file such request over protest under
paragraph (5)(A)(iii).
``(7) Packaging.--An administrative order issued under
paragraph (2), (4)(A), or (5) may include requirements for the
packaging of a drug to encourage use in accordance with
labeling. Such requirements may include unit dose packaging,
requirements for products intended for use by pediatric
populations, requirements to reduce risk of harm from
unsupervised ingestion, and other appropriate requirements.
This paragraph does not authorize the Food and Drug
Administration to require standards or testing procedures as
described in part 1700 of title 16, Code of Federal
Regulations.
``(8) Final and tentative final monographs for category i
drugs deemed final administrative orders.--
``(A) In general.--A final monograph or tentative
final monograph described in subparagraph (B) shall be
deemed to be a final administrative order under this
subsection and may be amended, revoked, or otherwise
modified in accordance with the procedures of this
subsection.
``(B) Monographs described.--For purposes of
subparagraph (A), a final monograph or tentative final
monograph is described in this subparagraph if it--
``(i) establishes conditions of use for a
drug described in paragraph (1) or (2) of
subsection (a); and
``(ii) represents the most recently
promulgated version of such conditions,
including as modified, in whole or in part, by
any proposed or final rule.
``(C) Deemed orders include harmonizing technical
amendments.--The deemed establishment of a final
administrative order under subparagraph (A) shall be
construed to include any technical amendments to such
order as the Secretary determines necessary to ensure
that such order is appropriately harmonized, in terms
of terminology or cross-references, with the applicable
provisions of this Act (and regulations thereunder) and
any other orders issued under this section.
``(c) Procedure for Minor Changes.--
``(1) In general.--Minor changes in the dosage form of a
drug that is described in paragraph (1) or (2) of subsection
(a) or the subject of an order issued under subsection (b) may
be made by a requestor without the issuance of an order under
subsection (b) if--
``(A) the requestor maintains such information as
is necessary to demonstrate that the change--
``(i) will not affect the safety or
effectiveness of the drug; and
``(ii) will not materially affect the
extent of absorption or other exposure to the
active ingredient in comparison to a suitable
reference product; and
``(B) the change is in conformity with the
requirements of an applicable administrative order
issued by the Secretary under paragraph (3).
``(2) Additional information.--
``(A) Access to records.--A sponsor shall submit
records requested by the Secretary relating to such a
minor change under section 704(a)(4), within 15
business days of receiving such a request, or such
longer period as the Secretary may provide.
``(B) Insufficient information.--If the Secretary
determines that the information contained in such
records is not sufficient to demonstrate that the
change does not affect the safety or effectiveness of
the drug or materially affect the extent of absorption
or other exposure to the active ingredient, the
Secretary--
``(i) may so inform the sponsor of the drug
in writing; and
``(ii) if the Secretary so informs the
sponsor, shall provide the sponsor of the drug
with a reasonable opportunity to provide
additional information.
``(C) Failure to submit sufficient information.--If
the sponsor fails to provide such additional
information within a time prescribed by the Secretary,
or if the Secretary determines that such additional
information does not demonstrate that the change does
not--
``(i) affect the safety or effectiveness of
the drug; or
``(ii) materially affect the extent of
absorption or other exposure to the active
ingredient in comparison to a suitable
reference product,
the drug as modified is a new drug under section 201(p)
and shall be deemed to be misbranded under section
502(ee).
``(3) Determining whether a change will affect safety or
effectiveness.--
``(A) In general.--The Secretary shall issue one or
more administrative orders specifying requirements for
determining whether a minor change made by a sponsor
pursuant to this subsection will affect the safety or
effectiveness of a drug or materially affect the extent
of absorption or other exposure to an active ingredient
in the drug in comparison to a suitable reference
product, together with guidance for applying those
orders to specific dosage forms.
``(B) Standard practices.--The orders and guidance
issued by the Secretary under subparagraph (A) shall
take into account relevant public standards and
standard practices for evaluating the quality of drugs,
and may take into account the special needs of
populations, including children.
``(d) Confidentiality of Information Submitted to the Secretary.--
``(1) In general.--Subject to paragraph (2), any
information, including reports of testing conducted on the drug
or drugs involved, that is submitted by a requestor in
connection with proceedings on an order under this section
(including any minor change under subsection (c)) and is a
trade secret or confidential information subject to section
552(b)(4) of title 5, United States Code, or section 1905 of
title 18, United States Code, shall not be disclosed to the
public unless the requestor consents to that disclosure.
``(2) Public availability.--
``(A) In general.--Except as provided in
subparagraph (B), the Secretary shall--
``(i) make any information submitted by a
requestor in support of a request under
subsection (b)(5)(A) available to the public
not later than the date on which the proposed
order is issued; and
``(ii) make any information submitted by
any other person with respect to an order
requested (or initiated by the Secretary) under
subsection (b), available to the public upon
such submission.
``(B) Limitations on public availability.--
Information described in subparagraph (A) shall not be
made public if--
``(i) the information pertains to
pharmaceutical quality information, unless such
information is necessary to establish standards
under which a drug is generally recognized as
safe and effective under section 201(p)(1);
``(ii) the information is submitted in a
requestor-initiated request, but the requestor
withdraws such request, in accordance with
withdrawal procedures established by the
Secretary, before the Secretary issues the
proposed order;
``(iii) the Secretary requests and obtains
the information under subsection (c) and such
information is not submitted in relation to an
order under subsection (b); or
``(iv) the information is of the type
contained in raw datasets.
``(e) Updates to Drug Listing Information.--A sponsor who makes a
change to a drug subject to this section shall submit updated drug
listing information for the drug in accordance with section 510(j)
within 30 calendar days of the date when the drug is first commercially
marketed, except that a sponsor who was the order requestor with
respect to an order subject to subsection (b)(5)(C) (or a licensee,
assignee, or successor in interest of such requestor) shall submit
updated drug listing information on or before the date when the drug is
first commercially marketed.
``(f) Approvals Under Section 505.--The provisions of this section
shall not be construed to preclude a person from seeking or maintaining
the approval of an application for a drug under sections 505(b)(1),
505(b)(2), and 505(j). A determination under this section that a drug
is not subject to section 503(b)(1), is generally recognized as safe
and effective under section 201(p)(1), and is not a new drug under
section 201(p) shall constitute a finding that the drug is safe and
effective that may be relied upon for purposes of an application under
section 505(b)(2), so that the applicant shall be required to submit
for purposes of such application only information needed to support any
modification of the drug that is not covered by such determination
under this section.
``(g) Public Availability of Administrative Orders.--The Secretary
shall establish, maintain, update (as determined necessary by the
Secretary but no less frequently than annually), and make publicly
available, with respect to orders issued under this section--
``(1) a repository of each final order and interim final
order in effect, including the complete text of the order; and
``(2) a listing of all orders proposed and under
development under subsection (b)(2), including--
``(A) a brief description of each such order; and
``(B) the Secretary's expectations, if resources
permit, for issuance of proposed orders over a 3-year
period.
``(h) Development Advice to Sponsors or Requestors.--The Secretary
shall establish procedures under which sponsors or requestors may meet
with appropriate officials of the Food and Drug Administration to
obtain advice on the studies and other information necessary to support
submissions under this section and other matters relevant to the
regulation of nonprescription drugs and the development of new
nonprescription drugs under this section.
``(i) Participation of Multiple Sponsors or Requestors.--The
Secretary shall establish procedures to facilitate efficient
participation by multiple sponsors or requestors in proceedings under
this section, including provision for joint meetings with multiple
sponsors or requestors or with organizations nominated by sponsors or
requestors to represent their interests in a proceeding.
``(j) Electronic Format.--All submissions under this section shall
be in electronic format.
``(k) Effect on Existing Regulations Governing Nonprescription
Drugs.--
``(1) Regulations of general applicability to
nonprescription drugs.--Except as provided in this subsection,
nothing in this section supersedes regulations establishing
general requirements for nonprescription drugs, including
regulations of general applicability contained in parts 201,
250, and 330 of title 21, Code of Federal Regulations, or any
successor regulations. The Secretary shall establish or modify
such regulations by means of rulemaking in accordance with
section 553 of title 5, United States Code.
``(2) Regulations establishing requirements for specific
nonprescription drugs.--
``(A) The provisions of section 310.545 of title
21, Code of Federal Regulations, as in effect on the
day before the date of the enactment of this section,
shall be deemed to be a final order under subsection
(b).
``(B) Regulations in effect on the day before the
date of the enactment of this section, establishing
requirements for specific nonprescription drugs
marketed pursuant to this section (including such
requirements in parts 201 and 250 of title 21, Code of
Federal Regulations), shall be deemed to be final
orders under subsection (b), only as they apply to
drugs--
``(i) subject to paragraph (1), (2), (3),
or (4) of subsection (a); or
``(ii) otherwise subject to an order under
this section.
``(3) Withdrawal of regulations.--The Secretary shall
withdraw regulations establishing final monographs and the
procedures governing the over-the-counter drug review under
part 330 and other relevant parts of title 21, Code of Federal
Regulations (as in effect on the day before the date of the
enactment of this section), or make technical changes to such
regulations to ensure conformity with appropriate terminology
and cross references. Notwithstanding subchapter II of chapter
5 of title 5, United States Code, any such withdrawal or
technical changes shall be made without public notice and
comment and shall be effective upon publication through notice
in the Federal Register (or upon such date as specified in such
notice).
``(l) Guidance.--The Secretary shall issue guidance that
specifies--
``(1) the procedures and principles for formal meetings
between the Secretary and sponsors or requestors for drugs
subject to this section;
``(2) the format and content of data submissions to the
Secretary under this section;
``(3) the format of electronic submissions to the Secretary
under this section;
``(4) consolidated proceedings for appeal and the
procedures for such proceedings where appropriate; and
``(5) for minor changes in drugs, recommendations on how to
comply with the requirements in orders issued under subsection
(c)(3).
``(m) Rule of Construction.--
``(1) In general.--This section shall not affect the
treatment or status of a nonprescription drug--
``(A) that is marketed without an application
approved under section 505 as of the date of the
enactment of this section;
``(B) that is not subject to an order issued under
this section; and
``(C) to which paragraphs (1), (2), (3), (4), or
(5) of subsection (a) do not apply.
``(2) Treatment of products previously found to be subject
to time and extent requirements.--
``(A) Notwithstanding subsection (a), a drug
described in subparagraph (B) may only be lawfully
marketed, without an application approved under section
505, pursuant to an order issued under this section.
``(B) A drug described in this subparagraph is a
drug which, prior to the date of the enactment of this
section, the Secretary determined in a proposed or
final rule to be ineligible for review under the OTC
drug review (as such phrase `OTC drug review' was used
in section 330.14 of title 21, Code of Federal
Regulations, as in effect on the day before the date of
the enactment of this section).
``(3) Preservation of authority.--
``(A) Nothing in paragraph (1) shall be construed
to preclude or limit the applicability of any provision
of this Act other than this section.
``(B) Nothing in subsection (a) shall be construed
to prohibit the Secretary from issuing an order under
this section finding a drug to be not generally
recognized as safe and effective under section
201(p)(1), as the Secretary determines appropriate.
``(n) Investigational New Drugs.--A drug is not subject to this
section if an exemption for investigational use under section 505(i) is
in effect for such drug.
``(o) Inapplicability of Paperwork Reduction Act.--Chapter 35 of
title 44, United States Code, shall not apply to collections of
information made under this section.
``(p) Inapplicability of Notice and Comment Rulemaking and Other
Requirements.--The requirements of subsection (b) shall apply with
respect to orders issued under this section instead of the requirements
of subchapter II of chapter 5 of title 5, United States Code.
``(q) Definitions.--In this section:
``(1) The term `nonprescription drug' refers to a drug not
subject to the requirements of section 503(b)(1).
``(2) The term `sponsor' refers to any person marketing,
manufacturing, or processing a drug that--
``(A) is listed pursuant to section 510(j); and
``(B) is or will be subject to an administrative
order under this section of the Food and Drug
Administration.
``(3) The term `requestor' refers to any person or group of
persons marketing, manufacturing, processing, or developing a
drug.''.
(b) GAO Study.--Not later than 4 years after the date of enactment
of this Act, the Comptroller General of the United States shall submit
a study to the Committee on Energy and Commerce of the House of
Representatives and the Committee on Health, Education, Labor, and
Pensions of the Senate addressing the effectiveness and overall impact
of exclusivity under section 505G of the Federal Food, Drug, and
Cosmetic Act, as added by subsection (a), and section 586C of such Act
(21 U.S.C. 360fff-3), including the impact of such exclusivity on
consumer access. Such study shall include--
(1) an analysis of the impact of exclusivity under such
section 505G for nonprescription drug products, including--
(A) the number of nonprescription drug products
that were granted exclusivity and the indication for
which the nonprescription drug products were determined
to be generally recognized as safe and effective;
(B) whether the exclusivity for such drug products
was granted for--
(i) a new active ingredient (including any
ester or salt of the active ingredient); or
(ii) changes in the conditions of use of a
drug, for which new human data studies
conducted or sponsored by the requestor were
essential;
(C) whether, and to what extent, the exclusivity
impacted the requestor's or sponsor's decision to
develop the drug product;
(D) an analysis of the implementation of the
exclusivity provision in such section 505G, including--
(i) the resources used by the Food and Drug
Administration;
(ii) the impact of such provision on
innovation, as well as research and development
in the nonprescription drug market;
(iii) the impact of such provision on
competition in the nonprescription drug market;
(iv) the impact of such provision on
consumer access to nonprescription drug
products;
(v) the impact of such provision on the
prices of nonprescription drug products; and
(vi) whether the administrative orders
initiated by requestors under such section 505G
have been sufficient to encourage the
development of nonprescription drug products
that would likely not be otherwise developed,
or developed in as timely a manner; and
(E) whether the administrative orders initiated by
requestors under such section 505G have been sufficient
incentive to encourage innovation in the
nonprescription drug market; and
(2) an analysis of the impact of exclusivity under such
section 586C for sunscreen ingredients, including--
(A) the number of sunscreen ingredients that were
granted exclusivity and the specific ingredient that
was determined to be generally recognized as safe and
effective;
(B) whether, and to what extent, the exclusivity
impacted the requestor's or sponsor's decision to
develop the sunscreen ingredient;
(C) whether, and to what extent, the sunscreen
ingredient granted exclusivity had previously been
available outside of the United States;
(D) an analysis of the implementation of the
exclusivity provision in such section 586C, including--
(i) the resources used by the Food and Drug
Administration;
(ii) the impact of such provision on
innovation, as well as research and development
in the sunscreen market;
(iii) the impact of such provision on
competition in the sunscreen market;
(iv) the impact of such provision on
consumer access to sunscreen products;
(v) the impact of such provision on the
prices of sunscreen products; and
(vi) whether the administrative orders
initiated by requestors under such section 505G
have been utilized by sunscreen ingredient
sponsors and whether such process has been
sufficient to encourage the development of
sunscreen ingredients that would likely not be
otherwise developed, or developed in as timely
a manner; and
(E) whether the administrative orders initiated by
requestors under such section 586C have been sufficient
incentive to encourage innovation in the sunscreen
market.
(c) Conforming Amendment.--Section 751(d)(1) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 379r(d)(1)) is amended--
(1) in the matter preceding subparagraph (A)--
(A) by striking ``final regulation promulgated''
and inserting ``final order under section 505G''; and
(B) by striking ``and not misbranded''; and
(2) in subparagraph (A), by striking ``regulation in
effect'' and inserting ``regulation or order in effect''.
SEC. 372. MISBRANDING.
Section 502 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
352) is amended by adding at the end the following:
``(ee) If it is a nonprescription drug that is subject to section
505G, is not the subject of an application approved under section 505,
and does not comply with the requirements under section 505G.
``(ff) If it is a drug and it was manufactured, prepared,
propagated, compounded, or processed in a facility for which fees have
not been paid as required by section 744M.''.
SEC. 373. DRUGS EXCLUDED FROM THE OVER-THE-COUNTER DRUG REVIEW.
(a) In General.--Nothing in this Act (or the amendments made by
this Act) shall apply to any nonprescription drug (as defined in
section 505G(q) of the Federal Food, Drug, and Cosmetic Act, as added
by section 1001 of this Act) which was excluded by the Food and Drug
Administration from the Over-the-Counter Drug Review in accordance with
the paragraph numbered 25 on page 9466 of volume 37 of the Federal
Register, published on May 11, 1972.
(b) Rule of Construction.--Nothing in this section shall be
construed to preclude or limit the applicability of any other provision
of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.).
SEC. 374. TREATMENT OF SUNSCREEN INNOVATION ACT.
(a) Review of Nonprescription Sunscreen Active Ingredients.--
(1) Applicability of section 505g for pending
submissions.--
(A) In general.--A sponsor of a nonprescription
sunscreen active ingredient or combination of
nonprescription sunscreen active ingredients that, as
of the date of enactment of this Act, is subject to a
proposed sunscreen order under section 586C of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360fff-
3) may elect, by means of giving written notification
to the Secretary of Health and Human Services within
180 calendar days of the enactment of this Act, to
transition into the review of such ingredient or
combination of ingredients pursuant to the process set
out in section 505G of the Federal Food, Drug, and
Cosmetic Act, as added by section 1001 of this Act.
(B) Election exercised.--Upon receipt by the
Secretary of Health and Human Services of a timely
notification under subparagraph (A)--
(i) the proposed sunscreen order involved
is deemed to be a request for an order under
subsection (b) of section 505G of the Federal
Food, Drug, and Cosmetic Act, as added by
section 1001 of this Act; and
(ii) such order is deemed to have been
accepted for filing under subsection
(b)(6)(A)(i) of such section 505G.
(C) Election not exercised.--If a notification
under subparagraph (A) is not received by the Secretary
of Health and Human Services within 180 calendar days
of the date of enactment of this Act, the review of the
proposed sunscreen order described in subparagraph
(A)--
(i) shall continue under section 586C of
the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 360fff-3); and
(ii) shall not be eligible for review under
section 505G, added by section 1001 of this
Act.
(2) Definitions.--In this subsection, the terms
``sponsor'', ``nonprescription'', ``sunscreen active
ingredient'', and ``proposed sunscreen order'' have the
meanings given to those terms in section 586 of the Federal
Food, Drug, and Cosmetic Act (21 U.S.C. 360fff).
(b) Amendments to Sunscreen Provisions.--
(1) Final sunscreen orders.--Paragraph (3) of section
586C(e) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
360fff-3(e)) is amended to read as follows:
``(3) Relationship to orders under section 505g.--A final
sunscreen order shall be deemed to be a final order under
section 505G.''.
(2) Meetings.--Paragraph (7) of section 586C(b) of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360fff-3(b)) is
amended--
(A) by striking ``A sponsor may request'' and
inserting the following:
``(A) In general.--A sponsor may request''; and
(B) by adding at the end the following:
``(B) Confidential meetings.--A sponsor may request
one or more confidential meetings with respect to a
proposed sunscreen order, including a letter deemed to
be a proposed sunscreen order under paragraph (3), to
discuss matters relating to data requirements to
support a general recognition of safety and
effectiveness involving confidential information and
public information related to such proposed sunscreen
order, as appropriate. The Secretary shall convene a
confidential meeting with such sponsor in a reasonable
time period. If a sponsor requests more than one
confidential meeting for the same proposed sunscreen
order, the Secretary may refuse to grant an additional
confidential meeting request if the Secretary
determines that such additional confidential meeting is
not reasonably necessary for the sponsor to advance its
proposed sunscreen order, or if the request for a
confidential meeting fails to include sufficient
information upon which to base a substantive
discussion. The Secretary shall publish a post-meeting
summary of each confidential meeting under this
subparagraph that does not disclose confidential
commercial information or trade secrets. This
subparagraph does not authorize the disclosure of
confidential commercial information or trade secrets
subject to 552(b)(4) of title 5, United States Code, or
section 1905 of title 18, United States Code.''.
(3) Exclusivity.--Section 586C of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 360fff-3) is amended by adding at
the end the following:
``(f) Exclusivity.--
``(1) In general.--A final sunscreen order shall have the
effect of authorizing solely the order requestor (or the
licensees, assignees, or successors in interest of such
requestor with respect to the subject of such request and
listed under paragraph (5)) for a period of 18 months, to
market a sunscreen ingredient under this section incorporating
changes described in paragraph (2) subject to the limitations
under paragraph (4), beginning on the date the requestor (or
any licensees, assignees, or successors in interest of such
requestor with respect to the subject of such request and
listed under paragraph (5)) may lawfully market such sunscreen
ingredient pursuant to the order.
``(2) Changes described.--A change described in this
paragraph is a change subject to an order specified in
paragraph (1) that permits a sunscreen to contain an active
sunscreen ingredient not previously incorporated in a marketed
sunscreen listed in paragraph (3).
``(3) Marketed sunscreen.--The marketed sunscreen
ingredients described in this paragraph are sunscreen
ingredients--
``(A) marketed in accordance with a final monograph
for sunscreen drug products set forth at part 352 of
title 21, Code of Federal Regulations (as published at
64 Fed. Reg. 27687); or
``(B) marketed in accordance with a final order
issued under this section.
``(4) Limitations on exclusivity.--Only one 18-month period
may be granted per ingredient under paragraph (1).
``(5) Listing of licensees, assignees, or successors in
interest.--Requestors shall submit to the Secretary at the time
when a drug subject to such request is introduced or delivered
for introduction into interstate commerce, a list of licensees,
assignees, or successors in interest under paragraph (1).''.
(4) Sunset provision.--Subchapter I of chapter V of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360fff et seq.)
is amended by adding at the end the following:
``SEC. 586H. SUNSET.
``This subchapter shall cease to be effective at the end of fiscal
year 2022.''.
(5) Treatment of final sunscreen order.--The Federal Food,
Drug, and Cosmetic Act is amended by striking section 586E of
such Act (21 U.S.C. 360fff-5).
(c) Treatment of Authority Regarding Finalization of Sunscreen
Monograph.--
(1) In general.--
(A) Revision of final sunscreen order.--Not later
than November 26, 2019, the Secretary of Health and
Human Services (referred to in this subsection as the
``Secretary'') shall amend and revise the final
administrative order concerning nonprescription
sunscreen (referred to in this subsection as the
``sunscreen order'') for which the content, prior to
the date of enactment of this Act, was represented by
the final monograph for sunscreen drug products set
forth in part 352 of title 21, Code of Federal
Regulations (as in effect on May 21, 1999).
(B) Issuance of revised sunscreen order; effective
date.--A revised sunscreen order described in
subparagraph (A) shall be--
(i) issued in accordance with the
procedures described in section 505G(c)(2) of
the Federal Food, Drug, and Cosmetic Act;
(ii) issued in proposed form not later than
May 28, 2019;
(iii) effective not later than November 26,
2020; and
(iv) issued by the Secretary at least 1
year prior to the effective date of the revised
order.
(2) Reports.--If a revised sunscreen order issued under
paragraph (1) does not include provisions related to the
effectiveness of various sun protection factor levels, and does
not address all dosage forms known to the Secretary to be used
in sunscreens marketed in the United States without a new drug
application approved under section 505 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355), the Secretary shall
submit a report to the Committee on Energy and Commerce of the
House of Representatives and the Committee on Health,
Education, Labor, and Pensions of the Senate on the rationale
for omission of such provisions from such order, and a plan and
timeline to compile any information necessary to address such
provisions through such order.
(d) Treatment of Non-Sunscreen Time and Extent Applications.--
(1) In general.--Any application described in section 586F
of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360fff-
6) that was submitted to the Secretary pursuant to section
330.14 of title 21, Code of Federal Regulations, as such
provisions were in effect immediately prior to the date of
enactment date of this Act, shall be extinguished as of such
date of enactment, subject to paragraph (2).
(2) Order request.--Nothing in paragraph (1) precludes the
submission of an order request under section 505G(b) of the
Federal Food, Drug, and Cosmetic Act, as added by section 1001
of this Act, with respect to a drug that was the subject of an
application extinguished under paragraph (1).
SEC. 375. ANNUAL UPDATE TO CONGRESS ON APPROPRIATE PEDIATRIC INDICATION
FOR CERTAIN OTC COUGH AND COLD DRUGS.
(a) In General.--Subject to subsection (c), the Secretary of Health
and Human Services shall, beginning not later than 1 year after the
date of enactment of this Act, annually submit to the Committee on
Energy and Commerce of the House of Representatives and the Committee
on Health, Education, Labor, and Pensions of the Senate a letter
describing the progress of the Food and Drug Administration--
(1) in evaluating the cough and cold monograph described in
subsection (b) with respect to children under age 6; and
(2) as appropriate, revising such cough and cold monograph
to address such children through the order process under
section 505G(b) of the Federal Food, Drug, and Cosmetic Act, as
added by section 1001 of this Act.
(b) Cough and Cold Monograph Described.--The cough and cold
monograph described in this subsection consists of the conditions under
which nonprescription drugs containing antitussive, expectorant, nasal
decongestant, or antihistamine active ingredients (or combinations
thereof) are generally recognized as safe and effective, as specified
in part 341 of title 21, Code of Federal Regulations (as in effect
immediately prior to the date of enactment of this Act), and included
in an order deemed to be established under section 505G(b) of the
Federal Food, Drug, and Cosmetic Act, as added by section 1001 of this
Act.
(c) Duration of Authority.--The requirement under subsection (a)
shall terminate as of the date of a letter submitted by the Secretary
of Health and Human Services pursuant to such subsection in which the
Secretary indicates that the Food and Drug Administration has completed
its evaluation and revised, in a final order, as applicable, the cough
and cold monograph as described in subsection (a)(2).
SEC. 376. TECHNICAL CORRECTIONS.
(a) Imports and Exports.--Section 801(e)(4)(E)(iii) of the Federal
Food, Drug, and Cosmetic Act (21 U.S.C. 381(e)(4)(E)(iii)) is amended
by striking ``subparagraph'' each place such term appears and inserting
``paragraph''.
(b) FDA Reauthorization Act of 2017.--
(1) In general.--Section 905(b)(4) of the FDA
Reauthorization Act of 2017 (Public Law 115-52) is amended by
striking ``Section 744H(e)(2)(B)'' and inserting ``Section
744H(f)(2)(B)''.
(2) Effective date.--The amendment made by paragraph (1)
shall take effect as of the enactment of the FDA
Reauthorization Act of 2017 (Public Law 115-52).
PART 2--USER FEES
SEC. 381. SHORT TITLE; FINDING.
(a) Short Title.--This part may be cited as the ``Over-the-Counter
Monograph User Fee Act of 2019''.
(b) Finding.--The Congress finds that the fees authorized by the
amendments made in this part will be dedicated to OTC monograph drug
activities, as set forth in the goals identified for purposes of part
10 of subchapter C of chapter VII of the Federal Food, Drug, and
Cosmetic Act, in the letters from the Secretary of Health and Human
Services to the Chairman of the Committee on Health, Education, Labor,
and Pensions of the Senate and the Chairman of the Committee on Energy
and Commerce of the House of Representatives, as set forth in the
Congressional Record.
SEC. 382. FEES RELATING TO OVER-THE-COUNTER DRUGS.
Subchapter C of chapter VII of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 379f et seq.) is amended by inserting after part 9 the
following:
``PART 10--FEES RELATING TO OVER-THE-COUNTER DRUGS
``SEC. 744L. DEFINITIONS.
``In this part:
``(1) The term `affiliate' means a business entity that has
a relationship with a second business entity if, directly or
indirectly--
``(A) one business entity controls, or has the
power to control, the other business entity; or
``(B) a third party controls, or has power to
control, both of the business entities.
``(2) The term `contract manufacturing organization
facility' means an OTC monograph drug facility where neither
the owner of such manufacturing facility nor any affiliate of
such owner or facility sells the OTC monograph drug produced at
such facility directly to wholesalers, retailers, or consumers
in the United States.
``(3) The term `costs of resources allocated for OTC
monograph drug activities' means the expenses in connection
with OTC monograph drug activities for--
``(A) officers and employees of the Food and Drug
Administration, contractors of the Food and Drug
Administration, advisory committees, and costs related
to such officers, employees, and committees and costs
related to contracts with such contractors;
``(B) management of information, and the
acquisition, maintenance, and repair of computer
resources;
``(C) leasing, maintenance, renovation, and repair
of facilities and acquisition, maintenance, and repair
of fixtures, furniture, scientific equipment, and other
necessary materials and supplies; and
``(D) collecting fees under section 744M and
accounting for resources allocated for OTC monograph
drug activities.
``(4) The term `FDA establishment identifier' is the unique
number automatically generated by Food and Drug
Administration's Field Accomplishments and Compliance Tracking
System (FACTS) (or any successor system).
``(5) The term `OTC monograph drug' means a nonprescription
drug without an approved new drug application which is governed
by the provisions of section 505G.
``(6) The term `OTC monograph drug activities' means
activities of the Secretary associated with OTC monograph drugs
and inspection of facilities associated with such products,
including the following activities:
``(A) The activities necessary for review and
evaluation of OTC monographs and OTC monograph order
requests, including--
``(i) orders proposing or finalizing
applicable conditions of use for OTC monograph
drugs;
``(ii) orders affecting status regarding
general recognition of safety and effectiveness
of an OTC monograph ingredient or combination
of ingredients under specified conditions of
use;
``(iii) all OTC monograph drug development
and review activities, including intra-agency
collaboration;
``(iv) regulation and policy development
activities related to OTC monograph drugs;
``(v) development of product standards for
products subject to review and evaluation;
``(vi) meetings referred to in section
505G(i);
``(vii) review of labeling prior to
issuance of orders related to OTC monograph
drugs or conditions of use; and
``(viii) regulatory science activities
related to OTC monograph drugs.
``(B) Inspections related to OTC monograph drugs.
``(C) Monitoring of clinical and other research
conducted in connection with OTC monograph drugs.
``(D) Safety activities with respect to OTC
monograph drugs, including--
``(i) collecting, developing, and reviewing
safety information on OTC monograph drugs,
including adverse event reports;
``(ii) developing and using improved
adverse event data-collection systems,
including information technology systems; and
``(iii) developing and using improved
analytical tools to assess potential safety
risks, including access to external databases.
``(E) Other activities necessary for implementation
of section 505G.
``(7) The term `OTC monograph order request' means a
request for an order submitted under section 505G(b)(5).
``(8) The term `Tier 1 OTC monograph order request' means
any OTC monograph order request not determined to be a Tier 2
OTC monograph order request.
``(9)(A) The term `Tier 2 OTC monograph order request'
means, subject to subparagraph (B), an OTC monograph order
request for--
``(i) the reordering of existing information in the
drug facts label of an OTC monograph drug;
``(ii) the addition of information to the other
information section of the drug facts label of an OTC
monograph drug, as limited by section 201.66(c)(7) of
title 21, Code of Federal Regulations (or any successor
regulations);
``(iii) modification to the directions for use
section of the drug facts label of an OTC monograph
drug, if such changes conform to changes made pursuant
to section 505G(c)(3)(A);
``(iv) the standardization of the concentration or
dose of a specific finalized ingredient within a
particular finalized monograph;
``(v) a change to ingredient nomenclature to align
with nomenclature of a standards-setting organization;
or
``(vi) addition of an interchangeable term in
accordance with section 330.1 of title 21, Code of
Federal Regulations (or any successor regulations).
``(B) The Secretary may, based on program implementation
experience or other factors found appropriate by the Secretary,
characterize any OTC monograph order request as a Tier 2 OTC
monograph order request (including recharacterizing a request
from Tier 1 to Tier 2) and publish such determination in a
proposed order issued pursuant to section 505G.
``(10)(A) The term `OTC monograph drug facility' means a
foreign or domestic business or other entity that--
``(i) is--
``(I) under one management, either direct
or indirect; and
``(II) at one geographic location or
address engaged in manufacturing or processing
the finished dosage form of an OTC monograph
drug;
``(ii) includes a finished dosage form manufacturer
facility in a contractual relationship with the sponsor
of one or more OTC monograph drugs to manufacture or
process such drugs; and
``(iii) does not include a business or other entity
whose only manufacturing or processing activities are
one or more of the following: production of clinical
research supplies, testing, or placement of outer
packaging on packages containing multiple products, for
such purposes as creating multipacks, when each
monograph drug product contained within the
overpackaging is already in a final packaged form prior
to placement in the outer overpackaging.
``(B) For purposes of subparagraph (A)(i)(II), separate
buildings or locations within close proximity are considered to
be at one geographic location or address if the activities
conducted in such buildings or locations are--
``(i) closely related to the same business
enterprise;
``(ii) under the supervision of the same local
management; and
``(iii) under a single FDA establishment identifier
and capable of being inspected by the Food and Drug
Administration during a single inspection.
``(C) If a business or other entity would meet criteria
specified in subparagraph (A), but for being under multiple
management, the business or other entity is deemed to
constitute multiple facilities, one per management entity, for
purposes of this paragraph.
``(11) The term `OTC monograph drug meeting' means any
meeting regarding the content of a proposed OTC monograph order
request.
``(12) The term `person' includes an affiliate of a person.
``(13) The terms `requestor' and `sponsor' have the
meanings given such terms in section 505G.
``SEC. 744M. AUTHORITY TO ASSESS AND USE OTC MONOGRAPH FEES.
``(a) Types of Fees.--Beginning with fiscal year 2019, the
Secretary shall assess and collect fees in accordance with this section
as follows:
``(1) Facility fee.--
``(A) In general.--Each person that owns a facility
identified as an OTC monograph drug facility on
December 31 of the fiscal year or at any time during
the preceding 12-month period shall be assessed an
annual fee for each such facility as determined under
subsection (c).
``(B) Exceptions.--
``(i) A fee shall not be assessed under
subparagraph (A) if the identified OTC
monograph drug facility--
``(I) has ceased all activities
related to OTC monograph drugs prior to
January 31, 2019, for the first program
year, and December 31 of the fiscal
year for subsequent fiscal years; and
``(II) has updated its registration
to reflect such change under the
requirements for drug establishment
registration set forth in section 510.
``(ii) The amount of the fee for a contract
manufacturing organization facility shall be
equal to two-thirds of the amount of the fee
for an OTC monograph drug facility that is not
a contract manufacturing organization facility.
``(C) Amount.--The amount of fees established under
subparagraph (A) shall be established under subsection
(c).
``(D) Due date.--
``(i) For first program year.--For fiscal
year 2019, the facility fees required under
subparagraph (A) shall be due 45 calendar days
after publication of the Federal Register
notice provided for under subsection (c)(4)(A).
``(ii) Subsequent fiscal years.--For each
fiscal year after fiscal year 2019, the
facility fees required under subparagraph (A)
shall be due on the later of--
``(I) the first business day of
June of such year; or
``(II) the first business day after
the enactment of an appropriations Act
providing for the collection and
obligation of fees under this section
for such year.
``(2) OTC monograph order request fee.--
``(A) In general.--Each person that submits an OTC
monograph order request shall be subject to a fee for
an OTC monograph order request. The amount of such fee
shall be--
``(i) for a Tier 1 OTC monograph order
request, $500,000, adjusted for inflation for
the fiscal year (as determined under subsection
(c)(1)(B)); and
``(ii) for a Tier 2 OTC monograph order
request, $100,000 adjusted for inflation for
the fiscal year (as determined under subsection
(c)(1)(B)).
``(B) Due date.--The OTC monograph order request
fees required under subparagraph (A) shall be due on
the date of submission of the OTC monograph order
request.
``(C) Exception for certain safety changes.--A
person who is named as the requestor in an OTC
monograph order shall not be subject to a fee under
subparagraph (A) if the Secretary finds that the OTC
monograph order request seeks to change the drug facts
labeling of an OTC monograph drug in a way that would
add to or strengthen--
``(i) a contraindication, warning, or
precaution;
``(ii) a statement about risk associated
with misuse or abuse; or
``(iii) an instruction about dosage and
administration that is intended to increase the
safe use of the OTC monograph drug.
``(D) Refund of fee if order request is
recategorized as a tier 2 otc monograph order
request.--If the Secretary determines that an OTC
monograph request initially characterized as Tier 1
shall be re-characterized as a Tier 2 OTC monograph
order request, and the requestor has paid a Tier 1 fee
in accordance with subparagraph (A)(i), the Secretary
shall refund the requestor the difference between the
Tier 1 and Tier 2 fees determined under subparagraphs
(A)(i) and (A)(ii), respectively.
``(E) Refund of fee if order request refused for
filing or withdrawn before filing.--The Secretary shall
refund 75 percent of the fee paid under subparagraph
(B) for any order request which is refused for filing
or was withdrawn before being accepted or refused for
filing.
``(F) Fees for order requests previously refused
for filing or withdrawn before filing.--An OTC
monograph order request that was submitted but was
refused for filing, or was withdrawn before being
accepted or refused for filing, shall be subject to the
full fee under subparagraph (A) upon being resubmitted
or filed over protest.
``(G) Refund of fee if order request withdrawn.--If
an order request is withdrawn after the order request
was filed, the Secretary may refund the fee or a
portion of the fee if no substantial work was performed
on the order request after the application was filed.
The Secretary shall have the sole discretion to refund
a fee or a portion of the fee under this subparagraph.
A determination by the Secretary concerning a refund
under this subparagraph shall not be reviewable.
``(3) Refunds.--
``(A) In general.--Other than refunds provided
pursuant to any of subparagraphs (D) through (G) of
paragraph (2), the Secretary shall not refund any fee
paid under paragraph (1) except as provided in
subparagraph (B).
``(B) Disputes concerning fees.--To qualify for the
return of a fee claimed to have been paid in error
under paragraph (1) or (2), a person shall submit to
the Secretary a written request justifying such return
within 180 calendar days after such fee was paid.
``(4) Notice.--Within the timeframe specified in subsection
(c), the Secretary shall publish in the Federal Register the
amount of the fees under paragraph (1) for such fiscal year.
``(b) Fee Revenue Amounts.--
``(1) Fiscal year 2019.--For fiscal year 2019, fees under
subsection (a)(1) shall be established to generate a total
facility fee revenue amount equal to the sum of--
``(A) the annual base revenue for fiscal year 2019
(as determined under paragraph (3));
``(B) the dollar amount equal to the operating
reserve adjustment for the fiscal year, if applicable
(as determined under subsection (c)(2)); and
``(C) additional direct cost adjustments (as
determined under subsection (c)(3)).
``(2) Subsequent fiscal years.--For each of the fiscal
years 2020 through 2023, fees under subsection (a)(1) shall be
established to generate a total facility fee revenue amount
equal to the sum of--
``(A) the annual base revenue for the fiscal year
(as determined under paragraph (3));
``(B) the dollar amount equal to the inflation
adjustment for the fiscal year (as determined under
subsection (c)(1));
``(C) the dollar amount equal to the operating
reserve adjustment for the fiscal year, if applicable
(as determined under subsection (c)(2));
``(D) additional direct cost adjustments (as
determined under subsection (c)(3)); and
``(E) additional dollar amounts for each fiscal
year as follows:
``(i) $7,000,000 for fiscal year 2020.
``(ii) $6,000,000 for fiscal year 2021.
``(iii) $7,000,000 for fiscal year 2022.
``(iv) $3,000,000 for fiscal year 2023.
``(3) Annual base revenue.--For purposes of paragraphs
(1)(A) and (2)(A), the dollar amount of the annual base revenue
for a fiscal year shall be--
``(A) for fiscal year 2019, $8,000,000; and
``(B) for fiscal years 2020 through 2023, the
dollar amount of the total revenue amount established
under this subsection for the previous fiscal year, not
including any adjustments made under subsection (c)(2)
or (c)(3).
``(c) Adjustments; Annual Fee Setting.--
``(1) Inflation adjustment.--
``(A) In general.--For purposes of subsection
(b)(2)(B), the dollar amount of the inflation
adjustment to the annual base revenue for fiscal year
2020 and each subsequent fiscal year shall be equal to
the product of--
``(i) such annual base revenue for the
fiscal year under subsection (b)(2); and
``(ii) the inflation adjustment percentage
under subparagraph (C).
``(B) OTC monograph order request fees.--For
purposes of subsection (a)(2), the dollar amount of the
inflation adjustment to the fee for OTC monograph order
requests for fiscal year 2020 and each subsequent
fiscal year shall be equal to the product of--
``(i) the applicable fee under subsection
(a)(2) for the preceding fiscal year; and
``(ii) the inflation adjustment percentage
under subparagraph (C).
``(C) Inflation adjustment percentage.--The
inflation adjustment percentage under this subparagraph
for a fiscal year is equal to--
``(i) for each of fiscal years 2020 and
2021, the average annual percent change that
occurred in the Consumer Price Index for urban
consumers (Washington-Baltimore, DC-MD-VA-WV;
Not Seasonally Adjusted; All items; Annual
Index) for the first 3 years of the preceding 4
years of available data; and
``(ii) for each of fiscal years 2022 and
2023, the sum of--
``(I) the average annual percent
change in the cost, per full-time
equivalent position of the Food and
Drug Administration, of all personnel
compensation and benefits paid with
respect to such positions for the first
3 years of the preceding 4 fiscal
years, multiplied by the proportion of
personnel compensation and benefits
costs to total costs of OTC monograph
drug activities for the first 3 years
of the preceding 4 fiscal years; and
``(II) the average annual percent
change that occurred in the Consumer
Price Index for urban consumers
(Washington-Baltimore, DC-MD-VA-WV; Not
Seasonally Adjusted; All items; Annual
Index) for the first 3 years of the
preceding 4 years of available data
multiplied by the proportion of all
costs other than personnel compensation
and benefits costs to total costs of
OTC monograph drug activities for the
first 3 years of the preceding 4 fiscal
years.
``(2) Operating reserve adjustment.--
``(A) In general.--For fiscal year 2019 and
subsequent fiscal years, for purposes of subsections
(b)(1)(B) and (b)(2)(C), the Secretary may, in addition
to adjustments under paragraph (1), further increase
the fee revenue and fees if such an adjustment is
necessary to provide operating reserves of carryover
user fees for OTC monograph drug activities for not
more than the number of weeks specified in subparagraph
(B).
``(B) Number of weeks.--The number of weeks
specified in this subparagraph is--
``(i) 3 weeks for fiscal year 2019;
``(ii) 7 weeks for fiscal year 2020;
``(iii) 10 weeks for fiscal year 2021;
``(iv) 10 weeks for fiscal year 2022; and
``(v) 10 weeks for fiscal year 2023.
``(C) Decrease.--If the Secretary has carryover
balances for such process in excess of 10 weeks of the
operating reserves referred to in subparagraph (A), the
Secretary shall decrease the fee revenue and fees
referred to in such subparagraph to provide for not
more than 10 weeks of such operating reserves.
``(D) Rationale for adjustment.--If an adjustment
under this paragraph is made, the rationale for the
amount of the increase or decrease (as applicable) in
fee revenue and fees shall be contained in the annual
Federal Register notice under paragraph (4)
establishing fee revenue and fees for the fiscal year
involved.
``(3) Additional direct cost adjustment.--The Secretary
shall, in addition to adjustments under paragraphs (1) and (2),
further increase the fee revenue and fees for purposes of
subsection (b)(2)(D) by an amount equal to--
``(A) $14,000,000 for fiscal year 2019;
``(B) $7,000,000 for fiscal year 2020;
``(C) $4,000,000 for fiscal year 2021;
``(D) $3,000,000 for fiscal year 2022; and
``(E) $3,000,000 for fiscal year 2023.
``(4) Annual fee setting.--
``(A) Fiscal year 2019.--The Secretary shall, not
later than the second Monday in March of 2019--
``(i) establish OTC monograph drug facility
fees for fiscal year 2019 under subsection (a),
based on the revenue amount for such year under
subsection (b) and the adjustments provided
under this subsection; and
``(ii) publish fee revenue, facility fees,
and OTC monograph order requests in the Federal
Register.
``(B) Subsequent fiscal years.--The Secretary
shall, not later than the second Monday in March of
each fiscal year that begins after September 30, 2019--
``(i) establish for each such fiscal year,
based on the revenue amounts under subsection
(b) and the adjustments provided under this
subsection--
``(I) OTC monograph drug facility
fees under subsection (a)(1); and
``(II) OTC monograph order request
fees under subsection (a)(2); and
``(ii) publish such fee revenue amounts,
facility fees, and OTC monograph order request
fees in the Federal Register.
``(d) Identification of Facilities.--Each person that owns an OTC
monograph drug facility shall submit to the Secretary the information
required under this subsection each year. Such information shall, for
each fiscal year--
``(1) be submitted as part of the requirements for drug
establishment registration set forth in section 510; and
``(2) include for each such facility, at a minimum,
identification of the facility's business operation as that of
an OTC monograph drug facility.
``(e) Effect of Failure To Pay Fees.--
``(1) OTC monograph drug facility fee.--
``(A) In general.--Failure to pay the fee under
subsection (a)(1) within 20 calendar days of the due
date as specified in subparagraph (D) of such
subsection shall result in the following:
``(i) The Secretary shall place the
facility on a publicly available arrears list.
``(ii) All OTC monograph drugs manufactured
in such a facility or containing an ingredient
manufactured in such a facility shall be deemed
misbranded under section 502(ff).
``(B) Application of penalties.--The penalties
under this paragraph shall apply until the fee
established by subsection (a)(1) is paid.
``(2) Order requests.--An OTC monograph order request
submitted by a person subject to fees under subsection (a)
shall be considered incomplete and shall not be accepted for
filing by the Secretary until all fees owed by such person
under this section have been paid.
``(3) Meetings.--A person subject to fees under this
section shall be considered ineligible for OTC monograph drug
meetings until all such fees owed by such person have been
paid.
``(f) Crediting and Availability of Fees.--
``(1) In general.--Fees authorized under subsection (a)
shall be collected and available for obligation only to the
extent and in the amount provided in advance in appropriations
Acts. Such fees are authorized to remain available until
expended. Such sums as may be necessary may be transferred from
the Food and Drug Administration salaries and expenses
appropriation account without fiscal year limitation to such
appropriation account for salaries and expenses with such
fiscal year limitation. The sums transferred shall be available
solely for OTC monograph drug activities.
``(2) Collections and appropriation acts.--
``(A) In general.--Subject to subparagraph (C), the
fees authorized by this section shall be collected and
available in each fiscal year in an amount not to
exceed the amount specified in appropriation Acts, or
otherwise made available for obligation, for such
fiscal year.
``(B) Use of fees and limitation.--The fees
authorized by this section shall be available to defray
increases in the costs of the resources allocated for
OTC monograph drug activities (including increases in
such costs for an additional number of full-time
equivalent positions in the Department of Health and
Human Services to be engaged in such activities), only
if the Secretary allocates for such purpose an amount
for such fiscal year (excluding amounts from fees
collected under this section) no less than $12,000,000,
multiplied by the adjustment factor applicable to the
fiscal year involved under subsection (c)(1).
``(C) Compliance.--The Secretary shall be
considered to have met the requirements of subparagraph
(B) in any fiscal year if the costs funded by
appropriations and allocated for OTC monograph drug
activities are not more than 15 percent below the level
specified in such subparagraph.
``(D) Provision for early payments in subsequent
years.--Payment of fees authorized under this section
for a fiscal year (after fiscal year 2019), prior to
the due date for such fees, may be accepted by the
Secretary in accordance with authority provided in
advance in a prior year appropriations Act.
``(3) Authorization of appropriations.--For each of the
fiscal years 2019 through 2023, there is authorized to be
appropriated for fees under this section an amount equal to the
total amount of fees assessed for such fiscal year under this
section.
``(g) Collection of Unpaid Fees.--In any case where the Secretary
does not receive payment of a fee assessed under subsection (a) within
30 calendar days after it is due, such fee shall be treated as a claim
of the United States Government subject to subchapter II of chapter 37
of title 31, United States Code.
``(h) Construction.--This section may not be construed to require
that the number of full-time equivalent positions in the Department of
Health and Human Services, for officers, employers, and advisory
committees not engaged in OTC monograph drug activities, be reduced to
offset the number of officers, employees, and advisory committees so
engaged.
``SEC. 744N. REAUTHORIZATION; REPORTING REQUIREMENTS.
``(a) Performance Report.--Beginning with fiscal year 2019, and not
later than 120 calendar days after the end of each fiscal year
thereafter for which fees are collected under this part, the Secretary
shall prepare and submit to the Committee on Energy and Commerce of the
House of Representatives and the Committee on Health, Education, Labor,
and Pensions of the Senate a report concerning the progress of the Food
and Drug Administration in achieving the goals identified in the
letters described in section 2001(b) of the Over-the-Counter Monograph
Safety, Innovation, and Reform Act of 2019 during such fiscal year and
the future plans of the Food and Drug Administration for meeting such
goals.
``(b) Fiscal Report.--Not later than 120 calendar days after the
end of fiscal year 2019 and each subsequent fiscal year for which fees
are collected under this part, the Secretary shall prepare and submit
to the Committee on Energy and Commerce of the House of Representatives
and the Committee on Health, Education, Labor, and Pensions of the
Senate a report on the implementation of the authority for such fees
during such fiscal year and the use, by the Food and Drug
Administration, of the fees collected for such fiscal year.
``(c) Public Availability.--The Secretary shall make the reports
required under subsections (a) and (b) available to the public on the
internet website of the Food and Drug Administration.
``(d) Reauthorization.--
``(1) Consultation.--In developing recommendations to
present to the Congress with respect to the goals described in
subsection (a), and plans for meeting the goals, for OTC
monograph drug activities for the first 5 fiscal years after
fiscal year 2023, and for the reauthorization of this part for
such fiscal years, the Secretary shall consult with--
``(A) the Committee on Energy and Commerce of the
House of Representatives;
``(B) the Committee on Health, Education, Labor,
and Pensions of the Senate;
``(C) scientific and academic experts;
``(D) health care professionals;
``(E) representatives of patient and consumer
advocacy groups; and
``(F) the regulated industry.
``(2) Public review of recommendations.--After negotiations
with the regulated industry, the Secretary shall--
``(A) present the recommendations developed under
paragraph (1) to the congressional committees specified
in such paragraph;
``(B) publish such recommendations in the Federal
Register;
``(C) provide for a period of 30 calendar days for
the public to provide written comments on such
recommendations;
``(D) hold a meeting at which the public may
present its views on such recommendations; and
``(E) after consideration of such public views and
comments, revise such recommendations as necessary.
``(3) Transmittal of recommendations.--Not later than
January 15, 2023, the Secretary shall transmit to the Congress
the revised recommendations under paragraph (2), a summary of
the views and comments received under such paragraph, and any
changes made to the recommendations in response to such views
and comments.''.
Subtitle I--Other Provisions
SEC. 391. PROTECTING ACCESS TO BIOLOGICAL PRODUCTS.
Section 351(k)(7) of the Public Health Service Act (42 U.S.C.
262(k)(7)) is amended by adding at the end the following:
``(D) Deemed licenses.--
``(i) No additional exclusivity through
deeming.--An approved application that is
deemed to be a license for a biological product
under this section pursuant to section
7002(e)(4) of the Biologics Price Competition
and Innovation Act of 2009 shall not be treated
as having been first licensed under subsection
(a) for purposes of subparagraphs (A) and (B).
``(ii) Application of limitations on
exclusivity.--Subparagraph (C) shall apply with
respect to a reference product referred to in
such subparagraph that was the subject of an
approved application that was deemed to be a
license pursuant to section 7002(e)(4) of the
Biologics Price Competition and Innovation Act
of 2009.
``(iii) Applicability.--The exclusivity
periods described in section 527, section
505A(b)(1)(A)(ii), and section
505A(c)(1)(A)(ii) of the Federal Food, Drug,
and Cosmetic Act shall continue to apply to a
biological product after an approved
application for the biological product is
deemed to be a license for the biological
product under subsection (a) pursuant to
section 7002(e)(4) of the Biologics Price
Competition and Innovation Act of 2009.''.
SEC. 392. ORPHAN DRUG CLARIFICATION.
Section 527(c) of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 360cc(c)) is amended by adding at the end the following:
``(3) Applicability.--This subsection applies to any drug
designated under section 526 for which an application was
approved under section 505 of this Act or licensed under
section 351 of the Public Health Service Act after the date of
enactment of the FDA Reauthorization Act of 2017, regardless of
the date on which such drug was designated under section
526.''.
SEC. 393. CONDITIONS OF USE FOR BIOSIMILAR BIOLOGICAL PRODUCTS.
Section 351(k)(2)(A)(iii) of the Public Health Service Act (42
U.S.C. 262(k)(2)(A)(iii)) is amended--
(1) in subclause (I), by striking ``; and'' and inserting a
semicolon;
(2) in subclause (II), by striking the period and inserting
``; and''; and
(3) by adding at the end the following:
``(III) may include information to
show that the conditions of use
prescribed, recommended, or suggested
in the labeling proposed for the
biological product have been previously
approved for the reference product.''.
SEC. 394. CLARIFYING THE MEANING OF NEW CHEMICAL ENTITY.
Chapter V of the Federal Food, Drug, and Cosmetic Act is amended--
(1) in section 505 (21 U.S.C. 355)--
(A) in subsection (c)(3)(E)--
(i) in clause (ii), by striking ``active
ingredient (including any ester or salt of the
active ingredient)'' and inserting ``active
moiety (as defined by the Secretary in section
314.3 of title 21, Code of Federal Regulations
(or any successor regulations))''; and
(ii) in clause (iii), by striking ``active
ingredient (including any ester or salt of the
active ingredient)'' and inserting ``active
moiety (as defined by the Secretary in section
314.3 of title 21, Code of Federal Regulations
(or any successor regulations))'';
(B) in subsection (j)(5)(F)--
(i) in clause (ii), by striking ``active
ingredient (including any ester or salt of the
active ingredient)'' and inserting ``active
moiety (as defined by the Secretary in section
314.3 of title 21, Code of Federal Regulations
(or any successor regulations))''; and
(ii) in clause (iii), by striking ``active
ingredient (including any ester or salt of the
active ingredient)'' and inserting ``active
moiety (as defined by the Secretary in section
314.3 of title 21, Code of Federal Regulations
(or any successor regulations))'';
(C) in subsection (l)(2)(A)(i), by striking
``active ingredient (including any ester or salt of the
active ingredient)'' and inserting ``active moiety (as
defined by the Secretary in section 314.3 of title 21,
Code of Federal Regulations (or any successor
regulations))'';
(D) in subsection (s), in the matter preceding
paragraph (1), by striking ``active ingredient
(including any ester or salt of the active
ingredient)'' and inserting ``active moiety (as defined
by the Secretary in section 314.3 of title 21, Code of
Federal Regulations (or any successor regulations))'';
and
(E) in subsection (u)(1), in the matter preceding
subparagraph (A)--
(i) by striking ``active ingredient
(including any ester or salt of the active
ingredient)'' and inserting ``active moiety (as
defined by the Secretary in section 314.3 of
title 21, Code of Federal Regulations (or any
successor regulations))''; and
(ii) by striking ``same active ingredient''
and inserting ``same active moiety'';
(2) in section 512(c)(2)(F) (21 U.S.C. 360b(c)(2)(F))--
(A) in clause (i), by striking ``active ingredient
(including any ester or salt of the active
ingredient)'' and inserting ``active moiety (as defined
by the Secretary in section 314.3 of title 21, Code of
Federal Regulations (or any successor regulations))'';
(B) in clause (ii), by striking ``active ingredient
(including any ester or salt of the active
ingredient)'' and inserting ``active moiety (as defined
by the Secretary in section 314.3 of title 21, Code of
Federal Regulations (or any successor regulations))'';
and
(C) in clause (v), by striking ``active ingredient
(including any ester or salt of the active
ingredient)'' and inserting ``active moiety (as defined
by the Secretary in section 314.3 of title 21, Code of
Federal Regulations (or any successor regulations))'';
(3) in section 524(a)(4)(C) (21 U.S.C. 360n(a)(4)(C)), by
striking ``active ingredient (including any ester or salt of
the active ingredient)'' and inserting ``active moiety (as
defined by the Secretary in section 314.3 of title 21, Code of
Federal Regulations (or any successor regulations))'';
(4) in section 529(a)(4)(A)(ii) (21 U.S.C.
360ff(a)(4)(A)(ii)), by striking ``active ingredient (including
any ester or salt of the active ingredient)'' and inserting
``active moiety (as defined by the Secretary in section 314.3
of title 21, Code of Federal Regulations (or any successor
regulations))''; and
(5) in section 565A(a)(4)(D) (21 U.S.C. 360bbb-
4a(a)(4)(D)), by striking ``active ingredient (including any
ester or salt of the active ingredient)'' and inserting
``active moiety (as defined by the Secretary in section 314.3
of title 21, Code of Federal Regulations (or any successor
regulations))''.
TITLE IV--REVENUE PROVISIONS
SEC. 401. PERMANENT EXTENSION OF REDUCTION IN MEDICAL EXPENSE DEDUCTION
FLOOR.
(a) In General.--Section 213(a) of the Internal Revenue Code of
1986 is amended by striking ``10 percent'' and inserting ``7.5
percent''.
(b) Conforming Amendments.--
(1) Section 213 of such Code is amended by striking
subsection (f).
(2) Section 56(b)(1) of such Code is amended by striking
subparagraph (B) and by redesignating subparagraphs (C), (D),
(E), and (F), as subparagraphs (B), (C), (D), and (E),
respectively.
(c) Effective Date.--The amendment made by this section shall apply
to taxable years ending after December 31, 2019.
SEC. 402. SAFE HARBOR FOR HIGH DEDUCTIBLE HEALTH PLANS WITHOUT
DEDUCTIBLE FOR INSULIN.
(a) In General.--Section 223(c)(2)(C) of the Internal Revenue Code
of 1986 is amended by inserting ``or for insulin or any device for the
delivery of insulin'' before the period at the end.
(b) Effective Date.--The amendment made by this section shall apply
to months beginning after the date of the enactment of this Act.
SEC. 403. INCLUSION OF CERTAIN OVER-THE-COUNTER MEDICAL PRODUCTS AS
QUALIFIED MEDICAL EXPENSES.
(a) HSAs.--Section 223(d)(2) of the Internal Revenue Code of 1986
is amended--
(1) by striking the last sentence of subparagraph (A) and
inserting the following: ``For purposes of this subparagraph,
amounts paid for menstrual care products shall be treated as
paid for medical care.''; and
(2) by adding at the end the following new subparagraph:
``(D) Menstrual care product.--For purposes of this
paragraph, the term `menstrual care product' means a
tampon, pad, liner, cup, sponge, or similar product
used by individuals with respect to menstruation or
other genital-tract secretions.''.
(b) Archer MSAs.--Section 220(d)(2)(A) of such Code is amended by
striking the last sentence and inserting the following: ``For purposes
of this subparagraph, amounts paid for menstrual care products (as
defined in section 223(d)(2)(D)) shall be treated as paid for medical
care.''.
(c) Health Flexible Spending Arrangements and Health Reimbursement
Arrangements.--Section 106 of such Code is amended by striking
subsection (f) and inserting the following new subsection:
``(f) Reimbursements for Menstrual Care Products.--For purposes of
this section and section 105, expenses incurred for menstrual care
products (as defined in section 223(d)(2)(D)) shall be treated as
incurred for medical care.''.
(d) Effective Dates.--
(1) Distributions from savings accounts.--The amendment
made by subsections (a) and (b) shall apply to amounts paid
after December 31, 2019.
(2) Reimbursements.--The amendment made by subsection (c)
shall apply to expenses incurred after December 31, 2019.
TITLE V--MISCELLANEOUS
SEC. 501. PAYMENT FOR BIOSIMILAR BIOLOGICAL PRODUCTS DURING INITIAL
PERIOD.
Section 1847A(c)(4) of the Social Security Act (42 U.S.C. 1395w-
3a(c)(4)) is amended--
(1) in each of subparagraphs (A) and (B), by redesignating
clauses (i) and (ii) as subclauses (I) and (II), respectively,
and moving such subclauses 2 ems to the right;
(2) by redesignating subparagraphs (A) and (B) as clauses
(i) and (ii) and moving such clauses 2 ems to the right;
(3) by striking ``unavailable.--In the case'' and inserting
``unavailable.--
``(A) In general.--Subject to subparagraph (B), in
the case''; and
(4) by adding at the end the following new subparagraph:
``(B) Limitation on payment amount for biosimilar
biological products during initial period.--In the case
of a biosimilar biological product furnished on or
after July 1, 2020, in lieu of applying subparagraph
(A) during the initial period described in such
subparagraph with respect to the biosimilar biological
product, the amount payable under this section for the
biosimilar biological product is the lesser of the
following:
``(i) The amount determined under clause
(ii) of such subparagraph for the biosimilar
biological product.
``(ii) The amount determined under
subsection (b)(1)(B) for the reference
biological product.''.
SEC. 502. GAO STUDY AND REPORT ON AVERAGE SALES PRICE.
(a) Study.--
(1) In general.--The Comptroller General of the United
States (in this section referred to as the ``Comptroller
General'') shall conduct a study on spending for applicable
drugs under part B of title XVIII of the Social Security Act.
(2) Applicable drugs defined.--In this section, the term
``applicable drugs'' means drugs and biologicals--
(A) for which reimbursement under such part B is
based on the average sales price of the drug or
biological; and
(B) that account for the largest percentage of
total spending on drugs and biologicals under such part
B (as determined by the Comptroller General, but in no
case less than 25 drugs or biologicals).
(3) Requirements.--The study under paragraph (1) shall
include an analysis of the following:
(A) The extent to which each applicable drug is
paid for--
(i) under such part B for Medicare
beneficiaries; or
(ii) by private payers in the commercial
market.
(B) Any change in Medicare spending or Medicare
beneficiary cost-sharing that would occur if the
average sales price of an applicable drug was based
solely on payments by private payers in the commercial
market.
(C) The extent to which drug manufacturers provide
rebates, discounts, or other price concessions to
private payers in the commercial market for applicable
drugs, which the manufacturer includes in its average
sales price calculation, for--
(i) formulary placement;
(ii) utilization management considerations;
or
(iii) other purposes.
(D) Barriers to drug manufacturers providing such
price concessions for applicable drugs.
(E) Other areas determined appropriate by the
Comptroller General.
(b) Report.--Not later than 2 years after the date of the enactment
of this Act, the Comptroller General shall submit to Congress a report
on the study conducted under subsection (a), together with
recommendations for such legislation and administrative action as the
Secretary determines appropriate.
SEC. 503. REQUIRING PRESCRIPTION DRUG PLANS AND MA-PD PLANS TO REPORT
POTENTIAL FRAUD, WASTE, AND ABUSE TO THE SECRETARY OF
HHS.
Section 1860D-4 of the Social Security Act (42 U.S.C. 1395w-104) is
amended by adding at the end the following new subsection:
``(p) Reporting Potential Fraud, Waste, and Abuse.--Beginning
January 1, 2021, the PDP sponsor of a prescription drug plan shall
report to the Secretary, as specified by the Secretary--
``(1) any substantiated or suspicious activities (as
defined by the Secretary) with respect to the program under
this part as it relates to fraud, waste, and abuse; and
``(2) any steps made by the PDP sponsor after identifying
such activities to take corrective actions.''.
SEC. 504. ESTABLISHMENT OF PHARMACY QUALITY MEASURES UNDER MEDICARE
PART D.
Section 1860D-4(c) of the Social Security Act (42 U.S.C. 1395w-
104(c)) is amended by adding at the end the following new paragraph:
``(8) Application of pharmacy quality measures.--
``(A) In general.--A PDP sponsor that implements
incentive payments to a pharmacy or price concessions
paid by a pharmacy based on quality measures shall use
measures established or approved by the Secretary under
subparagraph (B) with respect to payment for covered
part D drugs dispensed by such pharmacy.
``(B) Standard pharmacy quality measures.--The
Secretary shall establish or approve standard quality
measures from a consensus and evidence-based
organization for payments described in subparagraph
(A). Such measures shall focus on patient health
outcomes and be based on proven criteria measuring
pharmacy performance.
``(C) Effective date.--The requirement under
subparagraph (A) shall take effect for plan years
beginning on or after January 1, 2023, or such earlier
date specified by the Secretary if the Secretary
determines there are sufficient measures established or
approved under subparagraph (B) to meet the requirement
under subparagraph (A).''.
SEC. 505. IMPROVING COORDINATION BETWEEN THE FOOD AND DRUG
ADMINISTRATION AND THE CENTERS FOR MEDICARE & MEDICAID
SERVICES.
(a) In General.--
(1) Public meeting.--
(A) In general.--Not later than 12 months after the
date of the enactment of this Act, the Secretary of
Health and Human Services (referred to in this section
as the ``Secretary'') shall convene a public meeting
for the purposes of discussing and providing input on
improvements to coordination between the Food and Drug
Administration and the Centers for Medicare & Medicaid
Services in preparing for the availability of novel
medical products described in subsection (c) on the
market in the United States.
(B) Attendees.--The public meeting shall include--
(i) representatives of relevant Federal
agencies, including representatives from each
of the medical product centers within the Food
and Drug Administration and representatives
from the coding, coverage, and payment offices
within the Centers for Medicare & Medicaid
Services;
(ii) stakeholders with expertise in the
research and development of novel medical
products, including manufacturers of such
products;
(iii) representatives of commercial health
insurance payers;
(iv) stakeholders with expertise in the
administration and use of novel medical
products, including physicians; and
(v) stakeholders representing patients and
with expertise in the utilization of patient
experience data in medical product development.
(C) Topics.--The public meeting shall include a
discussion of--
(i) the status of the drug and medical
device development pipeline related to the
availability of novel medical products;
(ii) the anticipated expertise necessary to
review the safety and effectiveness of such
products at the Food and Drug Administration
and current gaps in such expertise, if any;
(iii) the expertise necessary to make
coding, coverage, and payment decisions with
respect to such products within the Centers for
Medicare & Medicaid Services, and current gaps
in such expertise, if any;
(iv) trends in the differences in the data
necessary to determine the safety and
effectiveness of a novel medical product and
the data necessary to determine whether a novel
medical product meets the reasonable and
necessary requirements for coverage and payment
under title XVIII of the Social Security Act
pursuant to section 1862(a)(1)(A) of such Act
(42 U.S.C. 1395y(a)(1)(A));
(v) the availability of information for
sponsors of such novel medical products to meet
each of those requirements; and
(vi) the coordination of information
related to significant clinical improvement
over existing therapies for patients between
the Food and Drug Administration and the
Centers for Medicare & Medicaid Services with
respect to novel medical products.
(D) Trade secrets and confidential information.--No
information discussed as a part of the public meeting
under this paragraph shall be construed as authorizing
the Secretary to disclose any information that is a
trade secret or confidential information subject to
section 552(b)(4) of title 5, United States Code.
(2) Improving transparency of criteria for medicare
coverage.--
(A) Draft guidance.--Not later than 18 months after
the public meeting under paragraph (1), the Secretary
shall update the final guidance titled ``National
Coverage Determinations with Data Collection as a
Condition of Coverage: Coverage with Evidence
Development'' to address any opportunities to improve
the availability and coordination of information as
described in clauses (iv) through (vi) of paragraph
(1)(C).
(B) Final guidance.--Not later than 12 months after
issuing draft guidance under subparagraph (A), the
Secretary shall finalize the updated guidance to
address any such opportunities.
(b) Report on Coding, Coverage, and Payment Processes Under
Medicare for Novel Medical Products.--Not later than 12 months after
the date of the enactment of this Act, the Secretary shall publish a
report on the Internet website of the Department of Health and Human
Services regarding processes under the Medicare program under title
XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) with respect
to the coding, coverage, and payment of novel medical products
described in subsection (c). Such report shall include the following:
(1) A description of challenges in the coding, coverage,
and payment processes under the Medicare program for novel
medical products.
(2) Recommendations to--
(A) incorporate patient experience data (such as
the impact of a disease or condition on the lives of
patients and patient treatment preferences) into the
coverage and payment processes within the Centers for
Medicare & Medicaid Services;
(B) decrease the length of time to make national
and local coverage determinations under the Medicare
program (as those terms are defined in subparagraph (A)
and (B), respectively, of section 1862(l)(6) of the
Social Security Act (42 U.S.C. 1395y(l)(6)));
(C) streamline the coverage process under the
Medicare program and incorporate input from relevant
stakeholders into such coverage determinations; and
(D) identify potential mechanisms to incorporate
novel payment designs similar to those in development
in commercial insurance plans and State plans under
title XIX of such Act (42 U.S.C. 1396 et seq.) into the
Medicare program.
(c) Novel Medical Products Described.--For purposes of this
section, a novel medical product described in this subsection is a
medical product, including a drug, biological (including gene and cell
therapy), or medical device, that has been designated as a breakthrough
therapy under section 506(a) of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 356(a)), a breakthrough device under section 515B of
such Act (21 U.S.C. 360e-3), or a regenerative advanced therapy under
section 506(g) of such Act (21 U.S.C. 356(g)).
SEC. 506. PATIENT CONSULTATION IN MEDICARE NATIONAL AND LOCAL COVERAGE
DETERMINATIONS IN ORDER TO MITIGATE BARRIERS TO INCLUSION
OF SUCH PERSPECTIVES.
Section 1862(l) of the Social Security Act (42 U.S.C. 1395y(l)) is
amended by adding at the end the following new paragraph:
``(7) Patient consultation in national and local coverage
determinations.--The Secretary may consult with patients and
organizations representing patients in making national and
local coverage determinations.''.
SEC. 507. MEDPAC REPORT ON SHIFTING COVERAGE OF CERTAIN MEDICARE PART B
DRUGS TO MEDICARE PART D.
(a) Study.--The Medicare Payment Advisory Commission (in this
section referred to as the ``Commission'') shall conduct a study on
shifting coverage of certain drugs and biologicals for which payment is
currently made under part B of title XVIII of the Social Security Act
(42 U.S.C. 1395j et seq.) to part D of such title (42 U.S.C. 1395w-21
et seq.). Such study shall include an analysis of--
(1) differences in program structures and payment methods
for drugs and biologicals covered under such parts B and D,
including effects of such a shift on program spending,
beneficiary cost-sharing liability, and utilization management
techniques for such drugs and biologicals; and
(2) the feasibility and policy implications of shifting
coverage of drugs and biologicals for which payment is
currently made under such part B to such part D.
(b) Report.--
(1) In general.--Not later than June 30, 2021, the
Commission shall submit to Congress a report containing the
results of the study conducted under subsection (a).
(2) Contents.--The report under paragraph (1) shall include
information, and recommendations as the Commission deems
appropriate, regarding--
(A) formulary design under such part D;
(B) the ability of the benefit structure under such
part D to control total spending on drugs and
biologicals for which payment is currently made under
such part B;
(C) changes to the bid process under such part D,
if any, that may be necessary to integrate coverage of
such drugs and biologicals into such part D;
(D) any other changes to the program that Congress
should consider in determining whether to shift
coverage of such drugs and biologicals from such part B
to such part D; and
(E) the feasibility and policy implications of
creating a methodology to preserve the healthcare
provider's ability to take title of the drug, including
a methodology under which--
(i) prescription drug plans negotiate
reimbursement rates and other arrangements with
drug manufacturers on behalf of a wholesaler;
(ii) wholesalers purchase the drugs from
the manufacturers at the negotiated rate and
ship them through distributors to physicians to
administer to patients;
(iii) physicians and hospitals purchase the
drug from the wholesaler via the distributor;
(iv) after administering the drug, the
physician submits a claim to the MAC for their
drug administration fee;
(v) to be reimbursed for the purchase of
the drug from the distributor, the physician
furnishes the claim for the drug itself to the
wholesaler and the wholesaler would refund the
cost of the drug to the physician; and
(vi) the wholesaler passes this claim to
the PDP to receive reimbursement.
SEC. 508. REQUIREMENT THAT DIRECT-TO-CONSUMER ADVERTISEMENTS FOR
PRESCRIPTION DRUGS AND BIOLOGICAL PRODUCTS INCLUDE
TRUTHFUL AND NON-MISLEADING PRICING INFORMATION.
Part A of title XI of the Social Security Act is amended by adding
at the end the following new section:
``SEC. 1150C. REQUIREMENT THAT DIRECT-TO-CONSUMER ADVERTISEMENTS FOR
PRESCRIPTION DRUGS AND BIOLOGICAL PRODUCTS INCLUDE
TRUTHFUL AND NON-MISLEADING PRICING INFORMATION.
``(a) In General.--The Secretary shall require that each direct-to-
consumer advertisement for a prescription drug or biological product
for which payment is available under title XVIII or XIX includes an
appropriate disclosure of truthful and non-misleading pricing
information with respect to the drug or product.
``(b) Determination by CMS.--The Secretary, acting through the
Administrator of the Centers for Medicare & Medicaid Services, shall
determine the components of the requirement under subsection (a), such
as the forms of advertising, the manner of disclosure, the price point
listing, and the price information for disclosure.''.
SEC. 509. CHIEF PHARMACEUTICAL NEGOTIATOR AT THE OFFICE OF THE UNITED
STATES TRADE REPRESENTATIVE.
(a) In General.--Section 141 of the Trade Act of 1974 (19 U.S.C.
2171) is amended--
(1) in subsection (b)(2)--
(A) by striking ``and one Chief Innovation and
Intellectual Property Negotiator'' and inserting ``one
Chief Innovation and Intellectual Property Negotiator,
and one Chief Pharmaceutical Negotiator'';
(B) by striking ``or the Chief Innovation and
Intellectual Property Negotiator'' and inserting ``the
Chief Innovation and Intellectual Property Negotiator,
or the Chief Pharmaceutical Negotiator''; and
(C) by striking ``and the Chief Innovation and
Intellectual Property Negotiator'' and inserting ``the
Chief Innovation and Intellectual Property Negotiator,
and the Chief Pharmaceutical Negotiator''; and
(2) in subsection (c), by adding at the end the following
new paragraph:
``(7) The principal function of the Chief Pharmaceutical
Negotiator shall be to conduct trade negotiations and to
enforce trade agreements relating to United States
pharmaceutical products and services. The Chief Pharmaceutical
Negotiator shall be a vigorous advocate on behalf of United
States pharmaceutical interests. The Chief Pharmaceutical
Negotiator shall perform such other functions as the United
States Trade Representative may direct.''.
(b) Compensation.--Section 5314 of title 5, United States Code, is
amended by striking ``Chief Innovation and Intellectual Property
Negotiator, Office of the United States Trade Representative.'' and
inserting the following:
``Chief Innovation and Intellectual Property Negotiator,
Office of the United States Trade Representative.
``Chief Pharmaceutical Negotiator, Office of the United
States Trade Representative.''.
(c) Report Required.--Not later than the date that is one year
after the appointment of the first Chief Pharmaceutical Negotiator
pursuant to paragraph (2) of section 141(b) of the Trade Act of 1974,
as amended by subsection (a), and annually thereafter, the United
States Trade Representative shall submit to the Committee on Finance of
the Senate and the Committee on Ways and Means of the House of
Representatives a report describing in detail--
(1) enforcement actions taken by the United States Trade
Representative during the one-year period preceding the
submission of the report to ensure the protection of United
States pharmaceutical products and services; and
(2) other actions taken by the United States Trade
Representative to advance United States pharmaceutical products
and services.
SEC. 510. WAIVING MEDICARE COINSURANCE FOR COLORECTAL CANCER SCREENING
TESTS.
Section 1833(a) of the Social Security Act (42 U.S.C. 1395l(a)) is
amended--
(1) by moving the flush text following paragraph (9) 2 ems
to the left; and
(2) by adding at the end of such flush text the following
new sentence: ``For items and services furnished on or after
January 1, 2021, paragraph (1)(Y) shall apply with respect to a
colorectal cancer screening test regardless of the code that is
billed for the establishment of a diagnosis as a result of the
test, or for the removal of tissue or other matter or other
procedure that is furnished in connection with, as a result of,
and in the same clinical encounter as the screening test.''.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, and the Judiciary, 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 Energy and Commerce, and in addition to the Committees on Ways and Means, and the Judiciary, 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 Energy and Commerce, and in addition to the Committees on Ways and Means, and the Judiciary, 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 Subcommittee on Health.
Referred to the Subcommittee on Antitrust, Commercial, and Administrative Law.
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