[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 974 Reported in Senate (RS)]
<DOC>
Calendar No. 482
115th CONGRESS
2d Session
S. 974
To promote competition in the market for drugs and biological products
by facilitating the timely entry of lower-cost generic and biosimilar
versions of those drugs and biological products.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 27, 2017
Mr. Leahy (for himself, Mr. Grassley, Ms. Klobuchar, Mr. Lee, Mrs.
Feinstein, Mrs. McCaskill, Ms. Collins, Mr. McCain, Mr. Blumenthal, Mr.
Whitehouse, Mr. Cotton, Mr. Durbin, Mr. Cruz, Mr. Paul, Ms. Hassan, Mr.
Kennedy, Ms. Smith, Ms. Murkowski, Ms. Baldwin, Mr. Daines, Mr. King,
Mr. Graham, Mr. Brown, Mr. Young, Ms. Stabenow, Mr. Rounds, Mr. Tester,
Mrs. Ernst, and Mr. Menendez) introduced the following bill; which was
read twice and referred to the Committee on the Judiciary
June 21, 2018
Reported by Mr. Grassley, with an amendment
[Strike out all after the enacting clause and insert the part printed
in italic]
_______________________________________________________________________
A BILL
To promote competition in the market for drugs and biological products
by facilitating the timely entry of lower-cost generic and biosimilar
versions of those drugs and biological products.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
<DELETED>SECTION 1. SHORT TITLE.</DELETED>
<DELETED> This Act may be cited as the ``Creating and Restoring
Equal Access To Equivalent Samples Act of 2017'' or the ``CREATES Act
of 2017''.</DELETED>
<DELETED>SEC. 2. FINDINGS.</DELETED>
<DELETED> Congress finds the following:</DELETED>
<DELETED> (1) It is the policy of the United States to
promote competition in the market for drugs and biological
products by facilitating the timely entry of low-cost generic
and biosimilar versions of those drugs and biological
products.</DELETED>
<DELETED> (2) Since their enactment in 1984 and 2010,
respectively, the Drug Price Competition and Patent Term
Restoration Act of 1984 (Public Law 98-417; 98 Stat. 1585) and
the Biologics Price Competition and Innovation Act of 2009
(Subtitle A of title VII of Public Law 111-148; 124 Stat. 804),
have provided pathways for making lower-cost versions of
previously approved drugs and previously licensed biological
products available to the people of the United States in a
timely manner, thereby lowering overall prescription drug costs
for patients and taxpayers by billions of dollars each
year.</DELETED>
<DELETED> (3) In order for these pathways to function as
intended, developers of generic drugs and biosimilar biological
products (referred to in this section as ``generic product
developers'') must be able to obtain quantities of the
reference listed drug or biological product with which the
generic drug or biosimilar biological product is intended to
compete (referred to in this section as a ``covered product'')
for purposes of supporting an application for approval by the
Food and Drug Administration, including for testing to show
that--</DELETED>
<DELETED> (A) a prospective generic drug is
bioequivalent to the covered product in accordance with
subsection (j) of section 505 of the Federal, Food,
Drug, and Cosmetic Act (21 U.S.C. 355), or meets the
requirements for approval of an application submitted
under subsection (b)(2) of that section; or</DELETED>
<DELETED> (B) a prospective biosimilar biological
product is biosimilar to or interchangeable with its
reference biological product under section 351(k) of
the Public Health Service Act (42 U.S.C. 262(k)), as
applicable.</DELETED>
<DELETED> (4) For drugs and biological products that are
subject to a risk evaluation and mitigation strategy, another
essential component in the creation of low-cost generic and
biosimilar versions of covered products is the ability of
generic product developers to join the manufacturer of the
covered product (referred to in this section as the ``license
holder'') in a single, shared system of elements to assure safe
use and supporting agreements, or secure a variance therefrom,
as required by section 505-1 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355-1).</DELETED>
<DELETED> (5) Contrary to the policy of the United States to
promote competition in the market for drugs and biological
products by facilitating the timely entry of lower-cost generic
and biosimilar versions of those drugs and biological products,
certain license holders are preventing generic product
developers from obtaining quantities of the covered product
necessary for the generic product developer to support an
application for approval by the Food and Drug Administration,
including testing to show bioequivalence, biosimilarity, or
interchangeability to the covered product, in some instances
based on the justification that the covered product is subject
to a risk evaluation and mitigation strategy with elements to
assure safe use under section 505-1 of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 355-1).</DELETED>
<DELETED> (6) The Director of the Center for Drug Evaluation
and Research at the Food and Drug Administration has testified
that some manufacturers of covered products have used REMS and
distribution restrictions adopted by the manufacturer on their
own behalf as reasons to not sell quantities of a covered
product to generic product developers, causing barriers and
delays in getting generic products on the market. The Food and
Drug Administration has reported receiving significant numbers
of inquiries from generic product developers who were unable to
obtain samples of covered products to conduct necessary testing
and otherwise meet requirements for approval of generic
drugs.</DELETED>
<DELETED> (7) The Chairwoman of the Federal Trade Commission
has testified that the Federal Trade Commission continues to be
very concerned about potential abuses by manufacturers of brand
drugs of REMS or other closed distribution systems to impede
generic competition.</DELETED>
<DELETED> (8) Also contrary to the policy of the United
States to promote competition in the market for drugs and
biological products by facilitating the timely entry of lower-
cost generic and biosimilar versions of those drugs and
biological products, certain license holders are impeding the
prompt negotiation and development on commercially reasonable
terms of a single, shared system of elements to assure safe
use, which may be necessary for the generic product developer
to gain approval for its drug or licensing for its biological
product.</DELETED>
<DELETED> (9) While the antitrust laws may address the
refusal by some license holders to provide quantities of a
covered product to a generic product developer, a more tailored
legal pathway would help ensure that generic product developers
can obtain necessary quantities of a covered product in a
timely way for purposes of developing a generic drug or
biosimilar biological product, facilitating competition in the
marketplace for drugs and biological products.</DELETED>
<DELETED> (10) The antitrust laws may address actions by
license holders who impede the prompt negotiation and
development of a single, shared system of elements to assure
safe use, and the Food and Drug Administration has some
authority to waive the requirement of a single, shared system.
Clearer regulatory authority to approve different systems that
meet the statutory requirements to ensure patient safety,
however, would limit the effectiveness of bad faith
negotiations over single, shared systems to delay generic
approval. At the same time, clearer regulatory authority would
ensure all systems protect patient safety.</DELETED>
<DELETED>SEC. 3. ACTIONS FOR DELAYS OF GENERIC DRUGS AND BIOSIMILAR
BIOLOGICAL PRODUCTS.</DELETED>
<DELETED> (a) Definitions.--In this section--</DELETED>
<DELETED> (1) the term ``covered product''--</DELETED>
<DELETED> (A) means--</DELETED>
<DELETED> (i) any drug approved under
subsection (b) 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);</DELETED>
<DELETED> (ii) any combination of a drug or
biological product described in clause (i);
or</DELETED>
<DELETED> (iii) when reasonably necessary to
demonstrate sameness, biosimilarity, or
interchangeability for purposes of 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, any product, including any device,
that is marketed or intended for use with such
drug or biological product; and</DELETED>
<DELETED> (B) does not include any drug or
biological product that the Secretary has determined to
be currently in shortage and 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 the shortage will not be promptly resolved--
</DELETED>
<DELETED> (i) as demonstrated by the fact
that the drug or biological product has been in
shortage for more than 6 months; or</DELETED>
<DELETED> (ii) as otherwise determined by
the Secretary;</DELETED>
<DELETED> (2) 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);</DELETED>
<DELETED> (3) 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));</DELETED>
<DELETED> (4) 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;</DELETED>
<DELETED> (5) 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);</DELETED>
<DELETED> (6) the term ``REMS with ETASU'' means a REMS that
contains elements to assure safe use under section 505-1 of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355-
1);</DELETED>
<DELETED> (7) the term ``Secretary'' means the Secretary of
Health and Human Services;</DELETED>
<DELETED> (8) 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 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355-1); and</DELETED>
<DELETED> (9) the term ``sufficient quantities'' means an
amount of a covered product that allows the eligible product
developer to--</DELETED>
<DELETED> (A) conduct testing to support an
application--</DELETED>
<DELETED> (i) 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</DELETED>
<DELETED> (ii) for licensing under section
351(k) of the Public Health Service Act (42
U.S.C. 262(k)); and</DELETED>
<DELETED> (B) fulfill any regulatory requirements
relating to such an application for approval or
licensing.</DELETED>
<DELETED> (b) Civil Action for Failure To Provide Sufficient
Quantities of a Covered Product.--</DELETED>
<DELETED> (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.</DELETED>
<DELETED> (2) Elements.--</DELETED>
<DELETED> (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--</DELETED>
<DELETED> (i) that--</DELETED>
<DELETED> (I) the covered product is
not subject to a REMS with ETASU;
or</DELETED>
<DELETED> (II) if the covered
product is subject to a REMS with
ETASU--</DELETED>
<DELETED> (aa) the eligible
product developer has obtained
a covered product authorization
from the Secretary in
accordance with subparagraph
(B); and</DELETED>
<DELETED> (bb) the eligible
product developer has provided
a copy of the covered product
authorization to the license
holder;</DELETED>
<DELETED> (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;</DELETED>
<DELETED> (iii) that the eligible product
developer has requested to purchase sufficient
quantities of the covered product from the
license holder; and</DELETED>
<DELETED> (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--
</DELETED>
<DELETED> (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</DELETED>
<DELETED> (II) for a covered product
that is subject to a REMS with ETASU,
by 31 days after the later of--
</DELETED>
<DELETED> (aa) the date on
which the license holder
received the request for the
covered product; or</DELETED>
<DELETED> (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).</DELETED>
<DELETED> (B) Authorization for covered product
subject to a rems with etasu.--</DELETED>
<DELETED> (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.</DELETED>
<DELETED> (ii) Authorization.--Not later
than 90 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--
</DELETED>
<DELETED> (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</DELETED>
<DELETED> (II) development and
testing that involves human clinical
trials, if the eligible product
developer has--</DELETED>
<DELETED> (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</DELETED>
<DELETED> (BB) otherwise
satisfied the Secretary that
such protections will be
provided; and</DELETED>
<DELETED> (bb) met any other
requirements the Secretary may
establish.</DELETED>
<DELETED> (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.</DELETED>
<DELETED> (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--</DELETED>
<DELETED> (A) that, on the date on which the
eligible product developer requested to purchase
sufficient quantities of the covered product from the
license holder--</DELETED>
<DELETED> (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</DELETED>
<DELETED> (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; or</DELETED>
<DELETED> (B) that--</DELETED>
<DELETED> (i) the license holder sells the
covered product through agents, distributors,
or wholesalers;</DELETED>
<DELETED> (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</DELETED>
<DELETED> (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.</DELETED>
<DELETED> (4) Remedies.--</DELETED>
<DELETED> (A) In general.--If an eligible product
developer prevails in a civil action brought under
paragraph (1), the court shall--</DELETED>
<DELETED> (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;</DELETED>
<DELETED> (ii) award to the eligible product
developer reasonable attorney fees and costs of
the civil action; and</DELETED>
<DELETED> (iii) award to the eligible
product developer a monetary amount sufficient
to deter the license holder from failing to
provide other 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--</DELETED>
<DELETED> (I) that the license
holder delayed providing sufficient
quantities of the covered product to
the eligible product developer without
a legitimate business justification;
or</DELETED>
<DELETED> (II) that the license
holder failed to comply with an order
issued under clause (i).</DELETED>
<DELETED> (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--</DELETED>
<DELETED> (i) beginning on--</DELETED>
<DELETED> (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</DELETED>
<DELETED> (II) for a covered product
that is subject to a REMS with ETASU,
the date that is 31 days after the
later of--</DELETED>
<DELETED> (aa) the date on
which the license holder
received the request;
or</DELETED>
<DELETED> (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</DELETED>
<DELETED> (ii) ending on the date on which
the eligible product developer received
sufficient quantities of the covered
product.</DELETED>
<DELETED> (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.</DELETED>
<DELETED> (c) Limitation of Liability.--A license holder for a
covered product shall not be liable for any claim 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.</DELETED>
<DELETED> (d) Rule of Construction.--</DELETED>
<DELETED> (1) Definition.--In this subsection, the term
``antitrust laws''--</DELETED>
<DELETED> (A) has the meaning given the term in
subsection (a) of the first section of the Clayton Act
(15 U.S.C. 12); and</DELETED>
<DELETED> (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.</DELETED>
<DELETED> (2) Antitrust laws.--Nothing in this section shall
be construed to limit the operation of any provision of the
antitrust laws.</DELETED>
<DELETED>SEC. 4. REMS APPROVAL PROCESS FOR SUBSEQUENT FILERS.</DELETED>
<DELETED> Section 505-1 of the Federal Food, Drug, and Cosmetic Act
(21 U.S.C. 355-1) is amended--</DELETED>
<DELETED> (1) in subsection (g)(4)(B)--</DELETED>
<DELETED> (A) in clause (i) by striking ``or'' after
the semicolon;</DELETED>
<DELETED> (B) in clause (ii) by striking the period
at the end and inserting ``; or''; and</DELETED>
<DELETED> (C) by adding at the end the
following:</DELETED>
<DELETED> ``(iii) accommodate different
approved risk evaluation and mitigation
strategies for a reference drug product and a
drug that is the subject of an abbreviated new
drug application.''; and</DELETED>
<DELETED> (2) in subsection (i)(1), by striking subparagraph
(B) and inserting the following:</DELETED>
<DELETED> ``(B) Elements to assure safe use, if
required under subsection (f) for the listed
drug.</DELETED>
<DELETED> ``(i) Subject to clause (ii), a
drug that is the subject of an abbreviated new
drug application may use--</DELETED>
<DELETED> ``(I) a single, shared
system with the listed drug under
subsection (f); or</DELETED>
<DELETED> ``(II) a different,
comparable aspect of the elements to
assure safe use under subsection
(f).</DELETED>
<DELETED> ``(ii) The Secretary may require a
drug that is the subject of an abbreviated new
drug application 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).''.</DELETED>
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Creating and Restoring Equal Access
to Equivalent Samples Act of 2018'' or the ``CREATES Act of 2018''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) It is the policy of the United States to promote
competition in the market for drugs and biological products by
facilitating the timely entry of low-cost generic and
biosimilar versions of those drugs and biological products.
(2) Since their enactment in 1984 and 2010, respectively,
the Drug Price Competition and Patent Term Restoration Act of
1984 (Public Law 98-417; 98 Stat. 1585) and the Biologics Price
Competition and Innovation Act of 2009 (subtitle A of title VII
of Public Law 111-148; 124 Stat. 804), have provided pathways
for making lower-cost versions of previously approved drugs and
previously licensed biological products available to the people
of the United States in a timely manner, thereby lowering
overall prescription drug costs for patients and taxpayers by
billions of dollars each year.
(3) In order for these pathways to function as intended,
developers of generic drugs and biosimilar biological products
(referred to in this section as ``generic product developers'')
must be able to obtain quantities of the reference listed drug
or biological product with which the generic drug or biosimilar
biological product is intended to compete (referred to in this
section as a ``covered product'') for purposes of supporting an
application for approval by the Food and Drug Administration,
including for testing to show that--
(A) a prospective generic drug is bioequivalent to
the covered product in accordance with subsection (j)
of section 505 of the Federal, Food, Drug, and Cosmetic
Act (21 U.S.C. 355), or meets the requirements for
approval of an application submitted under subsection
(b)(2) of that section; or
(B) a prospective biosimilar biological product is
biosimilar to or interchangeable with its reference
biological product under section 351(k) of the Public
Health Service Act (42 U.S.C. 262(k)), as applicable.
(4) For drugs and biological products that are subject to a
risk evaluation and mitigation strategy, another essential
component in the creation of low-cost generic and biosimilar
versions of covered products is the ability of generic product
developers to join the manufacturer of the covered product
(referred to in this section as the ``license holder'') in a
single, shared system of elements to assure safe use and
supporting agreements as required by section 505-1 of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355-1), or
secure a variance therefrom.
(5) Contrary to the policy of the United States to promote
competition in the market for drugs and biological products by
facilitating the timely entry of lower-cost generic and
biosimilar versions of those drugs and biological products,
certain license holders are preventing generic product
developers from obtaining quantities of the covered product
necessary for the generic product developer to support an
application for approval by the Food and Drug Administration,
including testing to show bioequivalence, biosimilarity, or
interchangeability to the covered product, in some instances
based on the justification that the covered product is subject
to a risk evaluation and mitigation strategy with elements to
assure safe use under section 505-1 of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 355-1).
(6) The Director of the Center for Drug Evaluation and
Research at the Food and Drug Administration has testified that
some manufacturers of covered products have used risk
evaluation and mitigation strategies and distribution
restrictions adopted by the manufacturer on their own behalf as
reasons to not sell quantities of a covered product to generic
product developers, causing barriers and delays in getting
generic products on the market. The Food and Drug
Administration has reported receiving significant numbers of
inquiries from generic product developers who were unable to
obtain samples of covered products to conduct necessary testing
and otherwise meet requirements for approval of generic drugs.
(7) The Acting Chairman of the Federal Trade Commission has
testified that the Federal Trade Commission continues to be
very concerned about potential abuses by manufacturers of brand
drugs of risk evaluation and mitigation strategies or other
closed distribution systems to impede generic competition.
(8) Also contrary to the policy of the United States to
promote competition in the market for drugs and biological
products by facilitating the timely entry of lower-cost generic
and biosimilar versions of those drugs and biological products,
certain license holders are impeding the prompt negotiation and
development on commercially reasonable terms of a single,
shared system of elements to assure safe use, which may be
necessary for the generic product developer to gain approval
for its drug or licensing for its biological product.
(9) While the antitrust laws may address the refusal by
some license holders to provide quantities of a covered product
to a generic product developer, a more tailored legal pathway
would help ensure that generic product developers can obtain
necessary quantities of a covered product in a timely way for
purposes of developing a generic drug or biosimilar biological
product, facilitating competition in the marketplace for drugs
and biological products.
(10) The antitrust laws may address actions by license
holders who impede the prompt negotiation and development of a
single, shared system of elements to assure safe use, and the
Food and Drug Administration has some authority to waive the
requirement of a single, shared system. Clearer regulatory
authority to approve different systems that meet the statutory
requirements to ensure patient safety, however, would limit the
effectiveness of bad faith negotiations over single, shared
systems to delay generic approval. At the same time, clearer
regulatory authority would ensure all systems protect patient
safety.
SEC. 3. 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 non-discriminatory 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 (b)
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 the shortage will not be
promptly resolved--
(i) as demonstrated by the fact that the
drug or biological product has been in shortage
for more than 6 months; or
(ii) as otherwise determined by the
Secretary;
(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 allows the eligible product developer
to--
(A) conduct testing to support an application--
(i) 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
(ii) for licensing under section 351(k) of
the Public Health Service Act (42 U.S.C.
262(k)); and
(B) fulfill any regulatory requirements relating to
such an application for approval or licensing.
(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 requested to purchase sufficient quantities
of the covered product from the license holder;
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; or
(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.
(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
other 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.--The provision of samples of a drug
pursuant to an authorization under subsection (b)(2)(B) shall not be
considered a violation of the requirements of any risk evaluation and
mitigation strategy that may be in place under section 505-1 of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355-1) 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. 4. REMS APPROVAL PROCESS FOR SUBSEQUENT FILERS.
Section 505-1 of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 355-1) is 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
approved risk evaluation and mitigation
strategies 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 (B) and
inserting the following:
``(B)(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).''; and
(3) by adding at the end the following:
``(l) 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.''.
Calendar No. 482
115th CONGRESS
2d Session
S. 974
_______________________________________________________________________
A BILL
To promote competition in the market for drugs and biological products
by facilitating the timely entry of lower-cost generic and biosimilar
versions of those drugs and biological products.
_______________________________________________________________________
June 21, 2018
Reported with an amendment