[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5782 Introduced in House (IH)]
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115th CONGRESS
2d Session
H. R. 5782
To hold pharmaceutical companies accountable for illegal marketing and
distribution of opioid products and for their role in creating and
exacerbating the opioid epidemic in the United States.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 11, 2018
Ms. Gabbard (for herself and Mr. Khanna) introduced the following bill;
which was referred to the Committee on Energy and Commerce, and in
addition to the Committees on Education and the Workforce, 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 hold pharmaceutical companies accountable for illegal marketing and
distribution of opioid products and for their role in creating and
exacerbating the opioid epidemic in the United States.
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 ``Opioid Crisis Accountability Act of
2018''.
SEC. 2. PROHIBITION OF ILLEGAL MARKETING AND DISTRIBUTION PRACTICES
WITH RESPECT TO OPIOIDS.
(a) In General.--Section 303 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 333) is amended by adding at the end the
following:
``(h)(1) In this subsection, the term `illegal marketing or
distribution practice with respect to an opioid' means--
``(A) including in any advertisement, promotion, direct-to-
consumer marketing materials, or other marketing material a
representation that an opioid has no addiction-forming or
addiction-sustaining liability or has less of an addiction-
forming or addiction-sustaining liability than 1 or more other
opioids, knowing the representation to be false, as determined
by the Secretary, in consultation with the Commissioner, based
on research, testimonials, and other evidence;
``(B) supplying States or communities with a quantity of
opioids that is not medically reasonable, as determined by the
Secretary, in consultation with the Attorney General using, if
applicable, data from the Automated Reports and Consolidated
Ordering System of the Department of Justice; or
``(C) failing to report to the Secretary any order or
pattern of orders for the distribution of opioids that would
cause a reasonable person to believe the opioids were not being
dispensed in a medically reasonable manner.
``(2) It shall be unlawful for any person who manufactures or
distributes an opioid to engage in an illegal marketing or distribution
practice with respect to an opioid.
``(3)(A) Any person who violates paragraph (2)--
``(i) if a natural person employed by an opioid
manufacturer or distributor, shall be--
``(I) subject to a civil penalty in an amount equal
to the sum of--
``(aa) such person's full amount of salary
for each year during which such person engaged
in illegal marketing or distribution practices
with respect to an opioid product; and
``(bb) the amount by which the stock or
other certificates of ownership interest of the
person that is owned by the individual has
increased in value during the period during
which such person engaged in illegal marketing
or distribution practices of an opioid product,
without regard to whether the individual has
sold any of the stock or certificates from such
opioid manufacturer or distributor; and
``(II) with respect to a violation that occurs on
or after the date of enactment of the Opioid Crisis
Accountability Act of 2018, subject to the period of
imprisonment specified under section 401 of the
Controlled Substances Act that would be applicable for
a violation of subsection (a) of such section that
involved the quantity of opioids that were involved in
the illegal marketing or distribution practices with
respect to an opioid;
``(ii) if not a natural person, shall be subject to a civil
penalty in the amount equal to the sum of--
``(I) $7,800,000,000; plus
``(II) 25 percent of the total profit such person
made on lawful sales of opioids in the United States
during the period in which the person engaged in
illegal marketing or distribution practices.
``(B) If a person that is not a natural person violates
paragraph (2), the court, without regard to the participation
of such individuals in, or knowledge of such individuals of,
the violation, shall--
``(i) impose on the chief executive officer (or
equivalent) of the person a civil penalty in an amount
equal to the sum of--
``(I) the salary of the individual during
the period in which the person engaged in
illegal marketing or distribution practices and
such individual served as chief executive
officer; and
``(II) the amount by which the stock or
other certificates of ownership interest of the
person that is owned by the individual has
increased in value during the period that the
person engaged in illegal marketing or
distribution practices and such individual
served as chief executive officer, without
regard to whether the individual has sold any
of the stock or certificates;
``(ii) impose on any executive other than the chief
executive officer (or equivalent) who led the finance,
research, marketing, or sales department of the person
a civil penalty in the amount equal to the sum of--
``(I) 25 percent of the salary of the
individual during the period that the person
engaged in illegal marketing or distribution
practices and such individual served as such an
executive; and
``(II) 25 percent of the amount by which
the stock or other certificates of ownership
interest of the person that is owned by the
individual has increased in value during the
period that the person engaged in illegal
marketing or distribution practices and such
individual served as such an executive, without
regard to whether the individual has sold any
of the stock or certificates; and
``(iii) impose on any executive, including the
chief executive officer (or equivalent) who led the
finance, research, marketing, or sales department of
the person during the calendar year in which a court
enters a judgment that the person violated paragraph
(2) and who is not subject to a civil penalty under
clause (i) or (ii), a civil penalty in the amount equal
to the sum of--
``(I) 25 percent of the salary of the
individual during the calendar year in which a
court enters such judgment; and
``(II) 25 percent of the amount by which
the stock or other certificates of ownership
interest of the person that is owned by the
individual has increased in value during the
calendar year in which a court enters such
judgment.
``(C) Any person described in clause (i) or (ii) of
subparagraph (A) shall be required to issue a public statement
apologizing for their role in creating, sustaining, and
exacerbating the opioid epidemic in the United States.''.
(b) Investigation; Retroactive Effect.--
(1) Investigation.--Immediately after the date of enactment
of this Act, the Secretary of Health and Human Services, acting
through the Commissioner of Food and Drugs and in consultation
with the Attorney General, acting through the Administrator of
the Drug Enforcement Administration, shall begin investigating
all opioid manufacturers and all executives employed by such
manufacturers to determine whether any such manufacturers or
executives, at any time before or after such date of enactment,
violated subsection (h)(2) of section 303 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 333) (as added by subsection
(a)).
(2) Retroactive effect.--Subsection (h)(2) of section 303
of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 333) (as
added by subsection (a)) shall take effect on January 1, 1985,
and shall have retroactive effect.
(c) Reimbursement of Economic Impact.--
(1) Establishment of fund.--There is established in the
Treasury of the United States a fund, to be known as the
``Opioids Reimbursement Fund'' (referred to in this subsection
as the ``Fund''), to be administered by the Secretary of Health
and Human Services (referred to in this subsection as the
``Secretary''), in consultation with the Commissioner of Food
and Drugs.
(2) Transfers to the fund.--In a manner consistent with
section 3302(b) of title 31, United States Code, there shall be
transferred to the Fund from the General Fund of the Treasury
an amount equal to the amount of the civil penalties collected
under subsection (h)(3) of section 303 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 333) (as added by subsection
(a)), which shall remain available until expended.
(3) Use of funds.--
(A) In general.--The Secretary, in consultation
with the Commissioner of Food and Drugs, may, without
further appropriation, use amounts in the Fund to
combat the abuse of opioids in the United States, which
may include transferring amounts from the Fund to other
agencies to carry out programs, projects, and
activities of the agencies to combat the abuse of
opioids in the United States.
(B) Priority.--In using amounts in the Fund, the
Secretary shall give priority to providing funds for--
(i) programs, projects, and activities of
the Substance Abuse and Mental Health Services
Administration, the Department of Labor, and
the Department of Justice;
(ii) programs, projects, and activities
that provide services to individuals directly
affected by the abuse of opioids (including
family members of such individuals);
(iii) programs, projects, and activities of
the Department of Education related to national
activities for school safety, including such
activities authorized under section 4631 of the
Elementary and Secondary Education Act of 1965
(20 U.S.C. 7281) to help State and local
educational agencies implement evidence-based
opioid-abuse prevention strategies for schools
in communities impacted by the opioid crisis,
and particularly for any applicant who
describes how such applicant would use the
funds to prevent opioid abuse by students and
address the mental health needs of students
affected by opioid abuse with their families or
communities; and
(iv) Head Start programs, including Early
Head Start programs, under the Head Start Act
(42 U.S.C. 9831 et seq.), to provide additional
qualified child care providers trained in
trauma-informed care in States with the largest
number of children and families affected by the
opioid crisis in their communities.
(C) Availability.--Amounts transferred to an agency
under subparagraph (A) shall remain available until
expended.
SEC. 3. REDUCED EXCLUSIVITY.
(a) In General.--If a drug manufacturer violates subsection (h)(2)
of section 303 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
333) (as added by section 2) with respect to a covered opioid,
effective on the date on which such manufacturer is found to have so
violated such section--
(1) any remaining period of market exclusivity with respect
to such covered opioid shall be revoked;
(2) the period of market exclusivity with respect to any
other opioid for which such manufacturer is the holder of an
approved application under section 505 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355) or a license under
section 351 of the Public Health Service Act (42 U.S.C. 262)
shall be reduced to one half of the remaining period of market
exclusivity; and
(3) no new or additional exclusivity shall be awarded to
any opioid for which an application is submitted by such
manufacturer for approval under section 505 of the Federal
Food, Drug, and Cosmetic Act (21 U.S.C. 355) or under section
351 of the Public Health Service Act (42 U.S.C. 262) or
marketed as a result of product hopping.
(b) Definitions.--For purposes of this section:
(1) Covered opioid.--A ``covered opioid'' is a prescription
opioid drug, the sales of which in the United States, beginning
on the date on which the drug was first eligible to be marketed
in the United States and ending on the date on which the
manufacturer was found to be in violation of subsection (h)(2)
of section 303 of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 333), has generated at least $1.
(2) Period of market exclusivity.--The term ``period of
market exclusivity'' with respect to a drug means the total
period of market exclusivity granted under clause (ii), (iii),
or (iv) of section 505(c)(3)(E) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355(c)(3)(E)), section 505(j)(5)(B)(iv)
of such Act, clause (ii), (iii), or (iv) of section
505(j)(5)(F) of such Act, section 527 of such Act, or section
351(k)(7) of the Public Health Service Act (42 U.S.C.
262(k)(7)), and any extension of such a period granted under
section 505A or 505E of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 355a, 355f).
(3) Product hopping.--The term ``product hopping'' means a
reformulation of an approved drug or biological product that
allows a manufacturer to submit a new drug application under
section 505(b) of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355(b)) or new application for a license under section
351(a) of the Public Health Service Act (42 U.S.C. 262(a)) and
that--
(A) is intended for the treatment of the same
medical condition as the drug or biological product
that was originally so approved; and
(B) is undertaken in conjunction with the sponsor's
actions to reduce or eliminate demand for the original
formulation of the drug or biological product.
SEC. 4. PENALTY WITH RESPECT TO OPIOIDS DEVELOPED USING FEDERAL
FUNDING.
If a drug manufacturer or distributor violates subsection (h)(2) of
section 303 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 333)
(as added by section 2) with respect to an opioid that was developed
with the support of Federal funding, in addition to the applicable
penalties under such subsection (h), such manufacturer or distributor
shall be subject to a civil penalty in an amount equal to the sum of--
(1) such Federal funding, regardless of whether the Federal
funding was received by the manufacturer or distributor or
another entity; plus
(2) 25 percent of the total profit such manufacturer or
distributor received in connection with manufacturing or
distributing such opioid.
SEC. 5. TREATMENT OF CERTAIN TAX CREDITS FOR VIOLATORS OF ILLEGAL
MARKETING AND DISTRIBUTION PRACTICES WITH RESPECT TO
OPIOIDS.
(a) In General.--Section 41 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subsection:
``(i) Treatment of Certain Taxpayers Violating Illegal Marketing
and Distribution Practices With Respect to Opioids.--
``(1) In general.--In the case of any taxpayer who has
engaged in an illegal marketing or distribution practice with
respect to an opioid (within the meaning of section 303(h) of
the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 333))--
``(A) no credit shall be allowed under subsection
(a), section 45C(a), or section 3111(f) for any taxable
year in the applicable period, and
``(B) the taxpayer's tax under this chapter for the
taxable year described in paragraph (2)(A) shall be
increased by an amount equal to the amount of credits
allowed to such taxpayer by reason of subsection (a),
section 45C(a), and section 3111(f) for the period
described in paragraph (2)(B).
``(2) Applicable period.--For purposes of this subsection,
the term `applicable period' means the period of taxable years
which--
``(A) begins with the taxable year in which a civil
penalty has been imposed for an illegal marketing or
distribution practice with respect to an opioid under
section 303(h)(3) of the Federal Food, Drug, and
Cosmetic Act, and
``(B) has a duration equal to the number of taxable
years in the period that begins with the first day on
which the illegal marketing or distribution practice
with respect to the opioid occurred and ends on the
earlier of date on which--
``(i) the illegal marketing or distribution
practice with respect to the opioid permanently
ceased, or
``(ii) the date on which the civil penalty
described in subparagraph (A) is imposed.
For purposes of subparagraph (B), any portion of a taxable year
that is less than a whole taxable year shall be treated as a
whole taxable year.''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years ending after the date of the enactment of this
Act.
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