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New Pharmaceutical Drug Pricing Legislation
- To: tap-drugs@tap.org
- Subject: New Pharmaceutical Drug Pricing Legislation
- From: James Love <love@tap.org>
- Date: Wed, 9 Oct 1996 22:54:18 -0400 (EDT)
This is the text of the new and much more comprehensive Sanders
bill. We'll have an analysis later... but there is a lot
of good stuff here.
jamie
FILE h4270.ih
HR 4270 IH
104th CONGRESS
2d Session
To require reporting on research and development expenditures for
drugs approved for marketing, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
September 27, 1996
Mr. SANDERS introduced the following bill; which was referred to
the Committee on Commerce
A BILL
To require reporting on research and development expenditures for
drugs approved for marketing, and for other purposes.
[Italic->] Be it enacted by the Senate and House of
Representatives of the United States of America in Congress
assembled, [<-Italic]
SECTION 1. SHORT TITLE.
This Act may be cited as the `Health Care Research and
Development and Consumer Protection Act'.
SEC. 2. FINDINGS.
The Congress makes the following findings:
(1) Public health needs are advanced by the development and
distribution of new drug therapies
(2) The public interest in the development of new drug
therapies is parallel to the public interest in controlling
public and private health care costs.
(3) The Federal Government needs mechanisms to ensure that
portions of revenues from the sale of drugs to consumers are
reinvested in the research and development of new technologies.
(4) The Federal Government is the single largest supporter of
biomedical research in the world, spending $33 billion in 1994
alone for biomedical and related health research.
(5) The Federal Government provides 80 percent of the monies
spent each year for fundamental biomedical research at
universities, medical schools, and other non-profit institutions.
(6) Of all the cancer drugs developed since the founding of
the National Cancer Institute's new drug program in 1955 and
approved for marketing by the Food and Drug Administration
through 1992, 34 of 37 cancer drugs, or 92 percent, were
developed with taxpayer funds.
(7) The public should not have to pay twice for health care
inventions, first as taxpayers and second as consumers.
(8) The Department of Health and Human Services has the
responsibility for funding basic biomedical research, for
funding medical treatment through the programs under titles
XVIII and XIX of the Social Security Act, for providing direct
medical care, and, more generally, for protecting the health
and safety of the public, it is incumbent upon the Secretary of
Health and Human Services to require a reasonable relationship
between the pricing of drugs, the public investment in those
drugs, and the health and safety needs of the public.
(9) The Department of Health and Human Services, academic
researchers, and the general public have the right to know, but
lack the necessary information about, information about the
actual costs for drug development, the general revenues
generated from the sale of pharmaceutical drugs, and the
taxpayer's investment in new drug development.
(10) The Department of Health and Human Services lacks the
necessary information to make appropriate decisions about the
reasonableness of drug
prices or the impact of its policies on research and development of
new medical technologies.
SEC. 3. REPORT ON RESEARCH OF THE FEDERAL GOVERNMENT.
(a) INVOLVEMENT OF THE FEDERAL GOVERNMENT- For each drug for
which an application under section 505, 507, or 512 of the Federal
Food, Drug, and Cosmetic Act has been approved the following shall
be reported to the Secretary of Health and Human Services:
(1) Each patent, cooperative research and development
agreement under section 12 of the Stevenson-Wydler Technology
Innovation Act of 1980, or other contractual agreement with the
Federal Government which contributed to the development of the
drug. The dollar amount of Federal funds expended, the agency
of the Federal Government which provided such funds, the dates
of any contractual agreements, and the nature of the research
and development activity shall be included in the report.
(2) Each grant, contract, or other funding mechanism of the
Federal Government which was used to support research or
development activities with respect to the drug, including any
grant or contract by the Federal Government to an institution
of higher education or other non profit institution or other
funds expended by the Federal Government on research and
development which directly contributed to the development of
the drug. The dollar amount of Federal funds expended, the
agency of the Federal Government which provided such funds, the
dates of any contractual agreements, and the nature of the
research and development activity shall be included in the
report.
The Secretary shall make such report available to the public.
(b) RESEARCH AND DEVELOPMENT-
(1) IN GENERAL- For each drug for which an application under
section 505, 507, or 512 of the Federal Food, Drug, and
Cosmetic Act has been approved the total amount expended for
each type of research and development of the drug in each
calendar year, including pre-clinical research and phase I, II,
and III clinical trials, the entity which made the
expenditures, and the amount provided by the Federal Government
shall be reported to the Secretary of Health and Human Services.
(2) PUBLIC DISCLOSURE OF DATA- If a drug is protected under
section 527(a) of the Federal Food, Drug, and Cosmetic Act or
under a patent, the material reported under paragraph (1) for
such drug shall be made available by the Secretary to the
public. If a drug is not protected under such section or a
patent, the Secretary shall make the report available to the
public in a form which does not identify individual entities.
SEC. 4. REASONABLE PRICE AGREEMENT.
(a) IN GENERAL- If any Federal agency or any non-profit entity
undertakes federally funded health care research and development
and is to convey or provide a patent or other exclusive right to
use such research and development for a drug or other health care
technology, such agency or entity shall not make such conveyance or
provide such patent or other right until the person who will
receive such patent or other right first agrees to a reasonable
pricing agreement with the Secretary of Health and Human Services
or the Secretary makes a determination that the public interest is
served by a waiver of the reasonable pricing agreement provided in
accordance with subsection (b).
(b) WAIVER- No waiver shall take effect under subsection (a)
before the public is given notice of the proposed waiver and
provided a reasonable opportunity to comment on the proposed
waiver. A decision to grant a waiver shall set out the Secretary's
finding that such a waiver is in the public interest.
SEC. 5. PURCHASE OF DRUGS DEVELOPED WITH TAXPAYER SUPPORT.
For any drug approved for marketing by the Food and Drug
Administration which was developed with significant Federal
support, the Secretary of Health and Human Services shall review
the price of the drug for purposes of determining a reasonable
price for Federal reimbursements under the programs under titles
XVIII and XIX of the Social Security Act and other Federal programs
that elect to participate in the Secretary's reasonable pricing
program, In determining a reasonable price for a drug, the
Secretary shall consider--
(1) the public interest in continued health care research and
development,
(2) the contribution of the person marketing such drug to the
drug research and development expenses, including the amount,
timing, and risk of investment in such research and development,
(3) the contribution of the Federal Government to the
research and development of such drug, including the amount,
timing, and risk of investment in such research and development,
(4) the therapeutic value of such drug,
(5) the number of patients who are expected to purchase such
drug,
(6) the cost of producing and marketing of such drug,
(7) the cost of therapies which are similar to the therapy
using such drug, and
(8) other relevant factors.
SEC. 6. MATERIAL TRANSFER AGREEMENT.
If in connection with research and development for health care
technologies, the Secretary of Health and Human Services determines
that the public interest will be advanced by the ability of the
Secretary to conduct research on biological substances or other
materials, the Secretary shall have the authority to compel the
owner of such substances or materials to provide the Secretary with
such substances or materials in accordance with a materials
transfer agreement. The agreement shall--
(1) provide the owner of such substances or materials
compensation for the costs incurred in making the transfer to
the Secretary;
(2) define the terms and conditions under which the Secretary
may use the materials;
(3) not grant rights in intellectual property or rights for
commercial purposes; and
(4) require that the material be used for research purposes
only.
SEC. 7. PROMOTION OF RESEARCH AND DEVELOPMENT.
(a) ACCOUNT- Any person engaged in the manufacture of drugs for
introduction into interstate commerce shall, in accordance with
subsection (b), establish for each drug an account for funds to be
reinvested in research and development for health care technologies.
(b) REINVESTMENT IN RESEARCH AND DEVELOPMENT- To insure that
adequate funds are being made available for research and
development of new health care technologies, the Secretary of
Health and Human Services shall establish for persons engaged in
the manufacture of drugs for introduction into interstate commerce
the minimum amount such person should make available for research
and development of its new health care technologies based upon a
percentage of sales revenue for that drug. The Secretary may
require different percentages for minimum reinvestment for
different classes of drugs based upon patient protection, orphan
drug status, or magnitude of sales.
(c) ADDITIONAL RULES- The Secretary shall adopt regulations
concerning qualifying research and development expenditures and the
reporting requirements for persons who are subject to subsections
(a) and (b).
SEC. 8. REPORTS ON SALES.
Any person engaged in the manufacture and sale of drugs approved
under section 505, 507, or 512 of the Federal Food, Drug, and
Cosmetic Act shall report to the Health Care Financing
Administration the total number of each drug it has sold and the
total revenue it has received from such sales, including sales made
outside the United States.
SEC. 9. GOVERNMENT EXPENDITURE ON PRESCRIPTION DRUGS.
The Secretary of Health and Human Services shall report to the
Congress annually on the estimate of the amount of money the
Federal government expends, directly or through reimbursement, for
the purchase of prescription drugs, including an estimate of the
amount of money expended each year on drugs which were developed
with significant Federal support.
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James Love / love@tap.org / P.O. Box 19367, Washington, DC 20036
Voice: 202/387-8030; Fax 202/234-5176
Center for Study of Responsive Law
Consumer Project on Technology; http://www.essential.org/cpt
Taxpayer Assets Project; http://www.tap.org
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