[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2493 Introduced in Senate (IS)]







108th CONGRESS
  2d Session
                                S. 2493

To amend the Federal Food, Drug, and Cosmetic Act to protect the public 
   health from the unsafe importation of prescription drugs and from 
        counterfeit prescription drugs, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              June 2, 2004

   Mr. Gregg (for himself, Mr. Smith, Ms. Collins, Mr. Coleman, Mr. 
Sessions, Mr. Lott, and Mr. Enzi) introduced the following bill; which 
  was read twice and referred to the Committee on Health, Education, 
                          Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
To amend the Federal Food, Drug, and Cosmetic Act to protect the public 
   health from the unsafe importation of prescription drugs and from 
        counterfeit prescription drugs, 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; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Safe Importation 
of Medical Products and Other Rx Therapies Act of 2004'' or the ``Safe 
IMPORT Act of 2004''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Importation.
Sec. 3. Protection against adulterated prescription drugs.
Sec. 4. Internet pharmacies.
Sec. 5. Administrative detention and temporary hold.
Sec. 6. Suspension.
Sec. 7. Debarment for repeated or serious prescription drug importation 
                            violations.
Sec. 8. Registration of prescription drug importation facilities.
Sec. 9. Maintenance and inspection of records for prescription drugs.
Sec. 10. Advance notice of imported prescription drug shipments.
Sec. 11. Authority to mark prescription drugs refused admission into 
                            the United States.
Sec. 12. Prohibition of port shopping.
Sec. 13. Authority to commission other Federal and State officials to 
                            conduct inspections.
Sec. 14. User fees relating to prescription drug importation.
Sec. 15. Anticounterfeiting provisions.
Sec. 16. Conforming amendments.

SEC. 2. IMPORTATION.

    (a) In General.--Chapter VIII of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 381 et seq.) is amended--
            (1) by inserting after the chapter heading the following:

               ``SUBCHAPTER A--GENERAL PROVISIONS''; and

            (2) by adding at the end the following:

           ``SUBCHAPTER B--IMPORTATION OF PRESCRIPTION DRUGS

``SEC. 811. DEFINITIONS.

    ``In this subchapter:
            ``(1) Drug importation facility.--The term `drug 
        importation facility' means a person, other than an individual 
        importing a prescription drug under section 812, located 
        outside the United States (other than a transporter) that 
        engages in the distribution or dispensing of a prescription 
        drug that is imported or offered for importation into the 
        United States.
            ``(2) Internet pharmacy.--The term `Internet pharmacy' 
        means a person, other than an individual importing a 
        prescription drug under section 812, that offers to dispense in 
        the United States a prescription drug through an Internet 
        website in interstate commerce, regardless of whether the 
        physical location of the principal place of business of the 
        Internet pharmacy is in the United States or in another 
        country.
            ``(3) Pharmacy.--The term `pharmacy' means a person, other 
        than an individual importing a prescription drug under section 
        812, licensed by a State to dispense prescription drugs or to 
        provide pharmaceutical care.
            ``(4) Permitted country.--
                    ``(A) In general.--The term `permitted country' 
                means a country that--
                            ``(i) was a member of the European Union as 
                        of December 31, 2003; and
                            ``(ii) is designated by the Secretary as a 
                        permitted country under subparagraph (B).
                    ``(B) Report.--Three years after the date of 
                enactment of this subchapter, the Secretary shall 
                submit to the Committee on Health, Education, Labor, 
                and Pensions of the Senate and to the Committee on 
                Energy and Commerce of the House of Representatives a 
                report that includes--
                            ``(i) a list of countries under 
                        subparagraph (A)(i) designated by the Secretary 
                        from which a prescription drug shall be 
                        permitted to be imported into the United States 
                        under this subchapter, and the basis for the 
                        Secretary's determination that the importation 
                        of a prescription drug from such countries 
                        would not present an increased risk to the 
                        public health;
                            ``(ii) a list of countries under 
                        subparagraph (A)(i) from which a prescription 
                        drug shall not be permitted to be imported into 
                        the United States under this subchapter, and 
                        the basis for Secretary's determination that 
                        the importation of a prescription drug from 
                        such countries would present an increased risk 
                        to the public health;
                            ``(iii) for countries identified in clause 
                        (i), any additional measures that could be 
                        taken to ensure that there will be no increased 
                        risk to the public health; and
                            ``(iv) for countries identified in clause 
                        (ii), any additional measures that could be 
                        taken to a avoid, reduce, or mitigate such 
                        increased risk to the public health.
                    ``(C) Determination.--The Secretary may determine 
                whether to designate a permitted country at any time 
                after submission of the report under subparagraph (B).
            ``(5) Prescription drug.--
                    ``(A) In general.--The term `prescription drug' 
                means a drug described in section 503(b) that is 
                approved by the Secretary under section 505.
                    ``(B) Exclusions.--The term `prescription drug' 
                does not include--
                            ``(i) a controlled substance (as defined in 
                        section 102 of the Controlled Substances Act 
                        (21 U.S.C. 802));
                            ``(ii) a biological product (as defined in 
                        section 351 of the Public Health Service Act 
                        (42 U.S.C. 262));
                            ``(iii) an infused drug (including a 
                        peritoneal dialysis solution);
                            ``(iv) an intravenously injected drug;
                            ``(v) a drug that is inhaled during 
                        surgery;
                            ``(vi) a parenteral drug;
                            ``(vii) a drug manufactured through 1 or 
                        more biotechnology processes, including--
                                    ``(I) a therapeutic DNA plasmid 
                                product;
                                    ``(II) a therapeutic synthetic 
                                peptide product of not more than 40 
                                amino acids;
                                    ``(III) a monoclonal antibody 
                                product for in vivo use; and
                                    ``(IV) a therapeutic recombinant 
                                DNA-derived product;
                            ``(viii) a drug required to be refrigerated 
                        at any time during manufacturing, packing, 
                        processing, or holding; or
                            ``(ix) a photoreactive drug.
            ``(6) Treating provider.--The term `treating provider' 
        means a licensed health care provider that--
                    ``(A)(i) performs a documented patient evaluation 
                (including a patient history and physical examination) 
                of an individual to establish the diagnosis for which a 
                prescription drug is prescribed;
                    ``(ii) discusses with the individual the treatment 
                options of the individual and the risks and benefits of 
                treatment; and
                    ``(iii) maintains contemporaneous medical records 
                concerning the individual; or
                    ``(B) provides care to an individual as part of an 
                on-call or cross-coverage arrangement with a health 
                care provider described in subparagraph (A).
            ``(7) Wholesaler.--
                    ``(A) In general.--The term `wholesaler' means a 
                person licensed as a wholesaler or distributor of 
                prescription drugs in the United States as described in 
                section 503(e)(2).
                    ``(B) Exclusion.--The term `wholesaler' does not 
                include--
                            ``(i) a person authorized to import drugs 
                        under section 801(d)(1); or
                            ``(ii) an individual importing a 
                        prescription drug under section 812.

``SEC. 812. PERSONAL IMPORTATION.

    ``(a) In General.--An individual may import a prescription drug 
from Canada or a permitted country into the United States for personal 
use (not for resale), subject to subsections (b) and (c).
    ``(b) Importation.--An individual may import a prescription drug 
if--
            ``(1) the prescription drug is purchased from a licensed 
        pharmacy in Canada or a licensed pharmacy in a permitted 
        country and dispensed in compliance with the applicable laws of 
        Canada or the permitted country regarding the practice of 
        pharmacy;
            ``(2) the prescription drug is imported for personal use 
        (not for resale) by the individual;
            ``(3) the prescription drug is imported from Canada or a 
        permitted country into the United States;
            ``(4) the prescription drug is imported by the individual 
        on the person of the individual;
            ``(5) the quantity of the prescription drug imported does 
        not exceed a 90-day supply during any 90-day period; and
            ``(6) the prescription drug is accompanied by--
                    ``(A) a copy of a prescription valid in a State and 
                cosigned by a prescribing physician in Canada or the 
                permitted country; or
                    ``(B) if the prescription drug is available in 
                Canada or the permitted country without a prescription, 
                a copy of the valid prescription signed by a pharmacist 
                licensed in Canada or the permitted country.
    ``(c) Compassionate Use.--The Secretary may permit an individual to 
import an up to a 90-day supply of a drug that is not approved by the 
Secretary under section 505 if the importation is for continuation of 
personal use by the individual for treatment, begun in a foreign 
country, of a serious medical condition.

``SEC. 813. PHARMACY AND WHOLESALER IMPORTATION OF PRESCRIPTION DRUGS.

    ``(a) In General.--
            ``(1) Importation.--A drug importation facility, pharmacy, 
        Internet pharmacy, or wholesaler may import a prescription drug 
        from Canada or a permitted country into the United States for 
        dispensing in the United States in accordance with this 
        subchapter.
            ``(2) Limitation to certain ports.--The Secretary may limit 
        the ports of entry in the United States through which a 
        prescription drug may be imported under this section to a 
        reasonable number of ports designated by the Secretary.
    ``(b) Requirements.--Each prescription drug imported under this 
subchapter shall--
            ``(1) be approved under section 505;
            ``(2) comply with sections 501 and 502;
            ``(3) be in a container that bears a label stating, in 
        prominent and conspicuous type--
                    ``(A) the lot number of the prescription drug;
                    ``(B) the name, address and phone number of the 
                drug importation facility;
                    ``(C) the following: `This drug has been imported 
                from _____.', with the name of the permitted country 
                from which the prescription drug is imported in the 
                blank space; and
                    ``(D) a unique identifier code provided by the 
                Secretary that modifies the national drug code of the 
                prescription drug to indicate that the drug has been 
                imported; and
            ``(4) comply with any other applicable requirement of this 
        Act.
    ``(c) Approved Labeling.--
            ``(1) In general.--A drug importation facility that offers 
        for importation a prescription drug under this subchapter shall 
        submit to the Secretary an application for approval that 
        demonstrates that the labeling of the prescription drug to be 
        imported into the United States complies with the requirements 
        of sections 502 and 503.
            ``(2) Procedure.--Not later than 60 days after receipt of a 
        completed application under paragraph (1), the Secretary 
        shall--
                    ``(A) approve or deny the application consistent 
                with the requirements of sections 502 and 503; and
                    ``(B) notify the applicant of the decision of the 
                Secretary and, if the application is denied, the reason 
                for the denial.
            ``(3) Lists.--
                    ``(A) Applications.--The Secretary shall maintain 
                an updated list of applications pending, applications 
                approved, and applications denied under this 
                subsection.
                    ``(B) Ports.--The Secretary shall maintain an 
                updated list of ports through which a prescription drug 
                may be imported under this section and make the list 
                available to the public on an Internet website.
    ``(d) Prohibition of Importation of a Prescription Drug That Enters 
Other Countries.--
            ``(1) In general.--A drug importation facility, pharmacy, 
        Internet pharmacy, or wholesaler shall not import a 
        prescription drug if, during any period in which the 
        prescription drug was not in the control of the manufacturer, 
        the prescription drug entered a country other than--
                    ``(A) Canada; or
                    ``(B) subject to paragraph (2), a country that was 
                a member of the European Union as of December 31, 2003.
            ``(2) Limitation.--The Secretary may exclude 1 or more of 
        the countries under subparagraph (B) of paragraph (1) from the 
        application of that subparagraph if the Secretary determines 
        that allowing a prescription drug to be imported into the 
        United States after having entered that country outside control 
        of a manufacturer would present a risk to the public health.
    ``(e) Prohibition of Commingling.--
            ``(1) In general.--A drug importation facility, pharmacy, 
        Internet pharmacy, or wholesaler shall not commingle a 
        prescription drug imported into the United States under this 
        subchapter with a prescription drug that is not imported from 
        Canada or a permitted country.
            ``(2) Label.--A pharmacy or Internet pharmacy that 
        dispenses a prescription drug imported from Canada or a 
        permitted country shall affix on each dispensed container of 
        the prescription drug the label required under subsection 
        (b)(3) unless such a label is already affixed to the container.
    ``(f) Drug Recalls.--On receipt of notification from the 
manufacturer of a prescription drug imported from Canada or a permitted 
country under this section that the prescription drug has been recalled 
or withdrawn from the market in Canada or a permitted country, a drug 
importation facility shall promptly provide the Secretary and any 
person to whom the prescription drug was distributed a notice that the 
drug has been recalled or withdrawn from the market and that includes--
            ``(1) information (including the lot number) that 
        identifies the prescription drug; and
            ``(2) a statement of the reason for the recall or 
        withdrawal.
    ``(g) Charitable Contributions.--Notwithstanding any other 
provision of this section, section 801(d)(1) continues to apply to a 
prescription drug that is donated or otherwise supplied at no charge or 
a nominal charge by the manufacturer of the prescription drug to a 
charitable or humanitarian organization (including the United Nations 
and affiliates) or to a government of a foreign country.
    ``(h) Jurisdiction.--The district courts of the United States shall 
have jurisdiction in an action brought by the United States against a 
person importing or offering for importation a prescription drug in 
violation of the requirements of this section.
    ``(i) Effect of Section.--Nothing in this section limits the 
authority of the Secretary relating to the importation of prescription 
drugs (including the interdiction of prescription drugs that are 
unapproved, adulterated, or misbranded), other than with respect to 
section 801(d)(1) as provided in subsection (g).''.
    (b) Regulations.--
            (1) Personal importation.--
                    (A) In general.--The Secretary of Health and Human 
                Services may promulgate regulations to carry out 
                section 812 of the Federal Food, Drug, and Cosmetic Act 
                (as added by this section).
                    (B) Effective date.--Section 812 of the Federal 
                Food, Drug, and Cosmetic Act shall take effect on the 
                date of enactment of this Act, without regard to 
                whether the Secretary of Health and Human Services has 
                promulgated regulations under paragraph (1).
            (2) Pharmacy and wholesaler importation of prescription 
        drugs.--
                    (A) In general.--The Secretary of Health and Human 
                Services shall promulgate interim final regulations to 
                carry out section 813 of the Federal Food, Drug, and 
                Cosmetic Act (as added by this section).
                    (B) Effective date.--Section 813 of the Federal 
                Food, Drug, and Cosmetic Act shall take effect on the 
                date that is 1 year after the date of enactment of this 
                Act, without regard to whether the Secretary of Health 
                and Human Services has promulgated regulations under 
                paragraph (1).
    (c) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) is amended by adding at the end the 
following:
    ``(hh) Dispensing or offering to dispense a prescription drug 
imported into the United States in violation of the requirements of 
section 813.''.

SEC. 3. PROTECTION AGAINST ADULTERATED PRESCRIPTION DRUGS.

    Section 801(h) of the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 381(h)) is amended--
            (1) in paragraph (2)--
                    (A) by inserting ``and prescription drugs'' after 
                ``related to foods'';
                    (B) by inserting ``and of prescription drugs'' 
                after ``adulteration of food,''; and
                    (C) by inserting ``and prescription drugs'' after 
                ``importation of food''; and
            (2) in paragraph (3), by inserting ``and for ensuring the 
        safety of imported prescription drugs'' after ``food safety''.

SEC. 4. INTERNET PHARMACIES.

    (a) Internet Pharmacies.--Chapter V of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 351 et seq.) is amended by inserting after 
section 510 the following:

``SEC. 511. INTERNET PHARMACIES.

    ``(a) Definitions.--In this section:
            ``(1) Advertising service provider.--The term `advertising 
        service provider' means an advertising company that contracts 
        with a provider of an interactive computer service (as defined 
        in section 230(f) of the Communications Act of 1934 (47 U.S.C. 
        230(f)) to provide advertising on the Internet.
            ``(2) Designated payment system.--
                    ``(A) In general.--The term `designated payment 
                system' means a system used by a person to effect a 
                credit transaction, electronic transfer, or money 
                transmitting service described in subparagraph (B) that 
                the Federal functional regulators determine, by 
                regulation or order, could be used in connection with, 
                or to facilitate, a restricted transaction.
                    ``(B) Persons described.--A person referred to in 
                subparagraph (A) is--
                            ``(i) a creditor;
                            ``(ii) a credit card issuer;
                            ``(iii) a financial institution;
                            ``(iv) an operator of a terminal at which 
                        an electronic fund transfer may be initiated;
                            ``(v) a money transmitting business; or
                            ``(vi)(I) an international, national, 
                        regional, or local network used to effect a 
                        credit transaction, electronic fund transfer, 
                        or money transmitting service; or
                            ``(II) any participant in a network 
                        described in subclause (I).
            ``(3) Federal functional regulator.--The term `Federal 
        functional regulator' has the meaning given the term in section 
        509 of the Gramm-Leach-Bliley Act (15 U.S.C. 6809).
            ``(4) Prescription drug.--The term `prescription drug' 
        means a drug described in section 503(b) that is approved by 
        the Secretary under section 505.
            ``(5) Internet pharmacy.--The term `Internet pharmacy' 
        means a person that dispenses or offers to dispense a 
        prescription drug through an Internet website in interstate 
        commerce in the United States regardless of whether the 
        physical location of the principal place of business of the 
        Internet pharmacy is in the United States or in another 
        country.
            ``(6) Restricted transaction.--The term `restricted 
        transaction' means a transaction or transmittal, on behalf of a 
        individual who places an unlawful Internet pharmacy request to 
        any person engaged in the operation of an unlicensed Internet 
        pharmacy, of--
                    ``(A) credit, or the proceeds of credit, extended 
                to or on behalf of the individual who placed the 
                unlawful Internet request (including credit extended 
                through the use of a credit card);
                    ``(B) an electronic fund transfer or funds 
                transmitted by or through a money transmitting 
                business, or the proceeds of an electronic fund 
                transfer or money transmitting service, from or on 
                behalf of the individual who placed the unlawful 
                Internet request;
                    ``(C) a check, draft, or similar instrument which 
                is drawn by or on behalf of the individual who placed 
                the unlawful Internet request and is drawn on or 
                payable at or through any financial institution; or
                    ``(D) the proceeds of any other form of financial 
                transaction (identified by the Federal functional 
                regulators by regulation) that involves a financial 
                institution as a payor or financial intermediary on 
                behalf of or for the benefit of the individual who 
                placed the unlawful Internet request.
            ``(7) Unlawful internet pharmacy request.--The term 
        `unlawful Internet pharmacy request' means the request, or 
        transmittal of a request, made to an unlicensed Internet 
        pharmacy for a prescription drug by mail (including a private 
        carrier), facsimile, phone, or electronic mail, or by a means 
        that involves the use, in whole or in part, of the Internet.
            ``(8) Other definitions.--
                    ``(A) Credit; creditor; credit card.--The terms 
                `credit', `creditor'; and `credit card' have the 
                meanings given the terms in section 103 of the Truth in 
                Lending Act (15 U.S.C. 1602).
                    ``(B) Electronic fund transfer.--The term 
                `electronic fund transfer'--
                            ``(i) has the meaning given the term in 
                        section 903 of the Electronic Fund Transfer Act 
                        (15 U.S.C. 1693a); and
                            ``(ii) includes any fund transfer covered 
                        under Article 4A of the Uniform Commercial 
Code, as in effect in any State.
                    ``(C) Financial institution.--The term `financial 
                institution'--
                            ``(i) has the meaning given the term in 
                        section 903 of the Electronic Transfer Fund Act 
                        (15 U.S.C. 1693a); and
                            ``(ii) includes a financial institution (as 
                        defined in section 509 of the Gramm-Leach-
                        Bliley Act (15 U.S.C. 6809)).
                    ``(D) Money transmitting business; money 
                transmitting service.--The terms `money transmitting 
                business' and `money transmitting service' have the 
                meaning given the terms in section 5330(d) of title 31, 
                United States Code.
    ``(b) In General.--An Internet pharmacy may only dispense or offer 
to dispense a prescription drug to a person in the United States in 
accordance with this section.
    ``(c) Licensing of Internet Pharmacies.--
            ``(1) In general.--To be licensed under this section an 
        Internet pharmacy shall--
                    ``(A) have its principal place of business in the 
                United States, Canada, or a permitted country; and
                    ``(B) be licensed by the Secretary in accordance 
                with this section prior to dispensing a prescription 
                drug to an individual.
            ``(2) Conditions for licensing.--
                    ``(A) Application requirements.--An Internet 
                pharmacy shall submit to the Secretary an application 
                that includes--
                            ``(i)(I) in the case of an Internet 
                        pharmacy located in the United States, 
                        verification that, in each State in which the 
                        Internet pharmacy engages in dispensing or 
                        offering to dispense prescription drugs, the 
                        Internet pharmacy, and all employees and agents 
                        of the Internet pharmacy, is in compliance with 
                        applicable Federal and State laws regarding--
                                    ``(aa) the practice of pharmacy, 
                                including licensing laws and inspection 
                                requirements; and
                                    ``(bb) the manufacturing and 
                                distribution of controlled substances, 
                                including with respect to mailing or 
                                shipping controlled substances to 
                                consumers; or
                            ``(II) in the case of an Internet pharmacy 
                        located in Canada or a permitted country, 
                        verification that--
                                    ``(aa) all employees and agents of 
                                the Internet pharmacy are in compliance 
                                with applicable laws of Canada or the 
                                permitted country regarding the 
                                practice of pharmacy, including 
                                licensing laws and inspection 
                                requirements; and
                                    ``(bb) the Internet pharmacy is in 
                                compliance with applicable Federal and 
                                State laws regarding the practice of 
                                pharmacy, including licensing laws and 
                                inspection requirements;
                            ``(ii) verification that the person that 
                        owns the Internet pharmacy has not had a 
                        license for an Internet pharmacy terminated by 
                        the Secretary, and that no other Internet 
                        pharmacy owned by the person has had a license 
                        under this subsection that has been terminated 
                        by the Secretary;
                            ``(iii) verification from the person that 
                        owns the Internet pharmacy that the person will 
                        permit inspection of the facilities and 
                        business practices of the Internet pharmacy by 
                        the Secretary to the extent necessary to 
                        determine whether the Internet pharmacy is in 
                        compliance with this subsection; and
                            ``(iv) in the case of an agreement between 
                        a patient and an Internet pharmacy that 
                        releases the Internet pharmacy, and any 
                        employee or agent of the Internet pharmacy, 
                        from liability for damages arising out of the 
                        negligence of the Internet pharmacy, an 
                        assurance that such a limitation of liability 
                        shall be null and void.
                    ``(B) Identification requirements.--An Internet 
                pharmacy shall provide to any person that accesses the 
                Internet pharmacy website, on each page of the website 
                of the Internet pharmacy or by a link to a separate 
                page, the following information:
                            ``(i) The street address, city, ZIP Code or 
                        comparable mail code, State (or comparable 
                        entity), country, and telephone number of--
                                    ``(I) each place of business of the 
                                Internet pharmacy; and
                                    ``(II) the name of the supervising 
                                pharmacist of the Internet pharmacy and 
                                each individual who serves as a 
                                pharmacist for purposes of the Internet 
                                pharmacy website.
                            ``(ii) The names of all States or 
                        countries, as appropriate, in which the 
                        Internet pharmacy and the pharmacists employed 
                        by the Internet pharmacy are licensed or 
                        otherwise authorized to dispense prescription 
                        drugs.
                            ``(iii) If the Internet pharmacy makes 
                        referrals to, or solicits on behalf of, a 
                        health care practitioner or group of 
                        practitioners in the United States for 
                        prescription services--
                                    ``(I) the name, street address, 
                                city, ZIP Code or comparable mail code, 
                                State, and telephone number of the 
                                practitioner or group; and
                                    ``(II) the name of each State in 
                                which each practitioner is licensed or 
                                otherwise authorized to prescribe 
                                drugs.
                            ``(iv) A statement that the Internet 
                        pharmacy will dispense prescription drugs only 
                        after receipt of a valid prescription.
                    ``(C) Professional services requirements.--An 
                Internet pharmacy shall carry out the following:
                            ``(i) Maintain patient medication profiles 
                        and other related data in a readily accessible 
                        format organized to facilitate consultation 
                        with treating providers, caregivers, and 
                        patients.
                            ``(ii) Conduct prospective drug use reviews 
                        before dispensing medications or medical 
                        devices.
                            ``(iii) Ensure patient confidentiality and 
                        the protection of patient identity and patient-
                        specific information, in accordance with the 
                        regulations promulgated under section 264(c) of 
                        the Health Insurance Portability and 
                        Accountability Act of 1996 (42 U.S.C. 1320d-2 
                        note).
                            ``(iv) Offer interactive and meaningful 
                        consultation by a licensed pharmacist to the 
                        caregiver or patient prior to and subsequent to 
                        the time at which the Internet pharmacy 
                        dispenses the drug.
                            ``(v)(I) Establish a mechanism for patients 
                        to report errors and suspected adverse drug 
                        reactions.
                            ``(II) Document in the reporting mechanism 
                        the response of the Internet pharmacy to those 
                        reports.
                            ``(vi) Develop a system to inform 
                        caregivers and patients about drug recalls.
                            ``(vii) Educate caregivers and patients 
                        about the appropriate means of disposing of 
                        expired, damaged, or unusable medications.
                            ``(viii) Assure that the sale of a 
                        prescription drug is in accordance with a 
                        prescription from the treating provider of the 
                        individual.
                            ``(ix)(I) Verify the validity of the 
                        prescription of an individual by using 1 of the 
                        following methods:
                                    ``(aa) Receiving from the 
                                individual or treating provider of the 
                                individual the prescription of the 
                                individual by mail (including a private 
                                carrier), or receiving from the 
                                treating provider of the individual the 
                                prescription of the individual by 
                                electronic mail.
                                    ``(bb) If the prescription is for a 
                                controlled substance (as defined in 
                                section 102 of the Controlled 
                                Substances Act (21 U.S.C. 802)), 
                                confirming with the treating provider 
                                the information in subclause (II).
                            ``(II) When seeking verification of a 
                        prescription of an individual under subclause 
                        (I)(bb), an Internet pharmacy shall provide to 
                        the treating provider the following 
                        information:
                                    ``(aa) The full name and address of 
                                the individual.
                                    ``(bb) Identification of the 
                                prescription drug.
                                    ``(cc) The quantity of the 
                                prescription drug to be dispensed.
                                    ``(dd) The date on which the 
                                individual presented the prescription 
                                to the Internet pharmacy.
                                    ``(ee) The date and time of the 
                                verification request.
                                    ``(ff) The name of a contact person 
                                at the Internet pharmacy, including a 
                                voice telephone number, electronic mail 
                                address, and facsimile telephone 
                                number.
                            ``(III) A prescription is verified under 
                        subclause (I)(bb) only if 1 of the following 
                        occurs:
                                    ``(aa) The treating provider 
                                confirms, by direct communication with 
                                the Internet pharmacy, that the 
                                prescription is accurate.
                                    ``(bb) The treating provider 
                                informs the Internet pharmacy that the 
                                prescription is inaccurate and provides 
                                the accurate prescription.
                            ``(IV) An Internet pharmacy shall not fill 
                        a prescription if--
                                    ``(aa) a treating provider informs 
                                the Internet pharmacy within 72 hours 
                                after receipt of a communication under 
                                subclause (I)(bb) that the prescription 
                                is inaccurate or expired; or
                                    ``(bb) the treating provider does 
                                not respond within that time.
                            ``(x) Maintain, for such period of time as 
                        the Secretary shall prescribe by regulation, a 
                        record of all direct communications with a 
                        treating provider regarding the dispensing of a 
                        prescription drug, including verification of 
                        the prescription.
            ``(3) Licensure procedure.--
                    ``(A) Action by secretary.--On receipt of a 
                completed licensing application under paragraph (3), 
                the Secretary shall--
                            ``(i) assign an identification number to 
                        each Internet pharmacy;
                            ``(ii) notify the applicant of the receipt 
                        of the licensure application; and
                            ``(iii) not later than 60 days after 
                        receipt of the licensure application, issue a 
                        license if the Internet pharmacy is in 
                        compliance with conditions under paragraph (3).
                    ``(B) Electronic filing.--
                            ``(i) In general.--For the purpose of 
                        reducing paperwork and reporting burdens, the 
                        Secretary shall require the use of electronic 
                        methods of submitting to the Secretary a 
                        licensure application required under this 
                        section and provide for electronic methods of 
                        receiving the applications.
                            ``(ii) Authentication.--In providing for 
                        the electronic submission of such licensure 
                        applications under this section, the Secretary 
                        shall ensure that adequate authentication 
                        protocols are used to allow identification of 
                        the Internet pharmacy and validation of the 
                        data as appropriate.
            ``(4) List.--
                    ``(A) In general.--The Secretary shall compile, 
                maintain, and periodically update a list of licensees.
                    ``(B) Availability.--The Secretary shall make the 
                list described under subparagraph (A) and information 
                submitted by the licensee under paragraph (2)(B) 
                available to the public on an Internet website and 
                through a toll-free telephone number.
            ``(5) Licensing fee.--The Secretary shall establish a 
        licensing fee that an Internet pharmacy licensed by the 
        Secretary under this section shall be required to pay to the 
        Secretary.
                    ``(A) Collection.--
                            ``(i) Collection of initial year licensing 
                        fee.--A licensing fee of $5,000 shall be 
                        payable for the fiscal year in which the 
                        Internet pharmacy first submits a licensing 
                        application under this section.
                            ``(ii) Collection in subsequent years.--
                        After the licensing fee is paid for the first 
                        fiscal year, the fee, as modified under 
                        subparagraph (B), shall be payable on or before 
                        October 1 of each year.
                            ``(iii) One fee per Internet pharmacy.--The 
                        licensing fee shall be paid only once for each 
                        Internet pharmacy for a fiscal year in which 
                        the fee is payable.
                    ``(B) Fee amount.--The amount of the licensing fee 
                shall be determined each year by the Secretary based on 
                the anticipated costs to the Secretary of enforcing the 
                requirements of this section in the subsequent fiscal 
                year.
                    ``(C) Annual fee determination.--
                            ``(i) In general.--Not later than 60 days 
                        before the beginning of each fiscal year 
                        beginning after September 30, 2004, the 
                        Secretary shall determine the licensing fee for 
                        that fiscal year.
                            ``(ii) Publication of fee amount.--Not 
                        later than 60 days before each fiscal year, the 
                        Secretary shall publish the licensing fee under 
                        this section for that fiscal year and provide 
                        for a period of 30 days for the public to 
                        provide written comments on the fee.
                    ``(D) Use of fees.--The licensing fees collected 
                under this section shall be used, without further 
                appropriation, to carry out this section.
                    ``(E) Failure to pay fee.--
                            ``(i) Due date.--A licensing fee payable 
                        under this section shall be paid by the date 
                        that is 30 days after the date on which the fee 
                        is due.
                            ``(ii) Failure to pay.--If an Internet 
                        pharmacy subject to a fee under this section 
                        fails to pay the fee by the date specified 
                        under clause (i), the Secretary shall not 
                        permit the Internet pharmacy to engage in the 
                        dispensing of drugs as described under this 
                        section until all such fees owed by the 
                        Internet pharmacy are paid.
                    ``(F) Reports.--Beginning with fiscal year 2005, 
                not later than 60 days after the end of each fiscal 
                year during which licensing fees are collected under 
                this section, the Secretary shall submit to the 
                Committee on Health, Education, Labor, and Pensions of 
                the Senate and the Committee on Energy and Commerce of 
                the House of Representatives a report that describes--
                            ``(i) implementation of the licensing fee 
                        authority during the fiscal year; and
                            ``(ii) the use by the Secretary of the 
                        licensing fees collected during the fiscal year 
                        for which the report is made.
            ``(6) Termination of license.--The Secretary, upon the 
        initiative of the Secretary, may terminate a license issued 
        under subsection (c), after notice to the Internet pharmacy and 
        an opportunity for a hearing, and if the Secretary determines 
        that an Internet pharmacy--
                    ``(A) has demonstrated a pattern of noncompliance 
                with this section;
                    ``(B) has made an untrue statement of material fact 
                in its license application; or
                    ``(C) is in violation of any applicable Federal or 
                State law relating to the dispensing of a prescription 
                drug.
            ``(7) Renewal evaluation.--
                    ``(A) In general.--Before renewing a license of an 
                Internet pharmacy under this subsection pursuant to the 
                submission of a renewal application, the Secretary 
                shall conduct an evaluation to determine whether the 
                Internet pharmacy is in compliance with this section.
                    ``(B) Evaluation.--At the discretion of the 
                Secretary and as applicable, an evaluation under 
                subparagraph (A) may include testing of the Internet 
                pharmacy website or other systems through which the 
                Internet pharmacy communicates with consumers, and a 
                physical inspection of the records and premises of the 
                pharmacy.
            ``(8) Contract for operation of program.--
                    ``(A) In general.--The Secretary may award a 
                contract under this subsection for the operation of the 
                licensing program.
                    ``(B) Term.--The duration of a contract under 
                subparagraph (A) shall not exceed 5 years and may be 
                renewable.
                    ``(C) Performance review.--The Secretary shall 
                annually review performance under a contract under 
                subparagraph (A).
    ``(d) Providers of Interactive Computer Services or Advertising 
Services.--A provider of interactive computer services (as defined in 
section 230(f) of the Communications Act of 1934 (47 U.S.C. 230(f))) or 
an advertising service provider shall be liable under this section for 
dispensing or selling prescription drugs in violation of this section 
on account of another person's selling or dispensing of a prescription 
drug if the provider of the service--
            ``(1) accepts advertising for a prescription drug from an 
        unlicensed Internet pharmacy; or
            ``(2) accepts advertising stating that an individual does 
        not need a physician's prescription to obtain a prescription 
        drug.
    ``(e) Policies and Procedures Required To Prevent Payments for 
Unlawful Internet Pharmacy Requests.--
            ``(1) Regulations.--Not later than 1 year after the date of 
        enactment of this section, the Federal functional regulators 
        shall promulgate regulations requiring a person described in 
        subsection (a)(2) to prevent restricted transactions by 
        establishing policies and procedures that--
                    ``(A)(i) are reasonably designed to allow the 
                payment system and any person involved in the payment 
                system to identify restricted transactions by means of 
                codes in authorization messages or by other means; and
                    ``(ii) are reasonably designed to block restricted 
                transactions identified as a result of the policies and 
                procedures developed under clause (i); or
                    ``(B) prevent the acceptance of the products or 
                services of the payment system in connection with a 
                restricted transaction.
            ``(2) Requirements for policies and procedures.--In 
        promulgating regulations under paragraph (1), the Federal 
        functional regulators shall--
                    ``(A) identify types of policies and procedures, 
                including nonexclusive examples, that shall be 
                considered to be reasonably designed to identify and 
                reasonably designed to block or to prevent the 
                acceptance of the products or services in connection 
                with each type of restricted transaction, including--
                            ``(i) identifying transactions by a code or 
                        codes in the authorization message; and
                            ``(ii) denying authorization of a credit 
                        card transaction in response to an 
                        authorization message; and
                    ``(B) to the extent practicable, permit any 
                participant in a designated payment system to choose 
                among alternative means of identifying and blocking, or 
                otherwise preventing the acceptance of the products or 
                services of the designated payment system or 
                participant in connection with, restricted 
                transactions.
            ``(3) Compliance with payment system policies and 
        procedures.--A person described in subsection (a)(2)(B) meets 
        the requirement of paragraph (1) if--
                    ``(A) the person relies on and complies with the 
                policies and procedures of a designated payment system 
                of which the person is a member or in which the person 
                is a participant, to--
                            ``(i) identify and block restricted 
                        transactions; or
                            ``(ii) otherwise prevent the acceptance of 
                        the products or services of the payment system, 
                        member, or participant in connection with 
                        restricted transactions; and
                    ``(B) such policies and procedures of the 
                designated payment system comply with the requirements 
                of regulations promulgated under paragraph (1).
            ``(4) No liability for blocking or refusing to honor 
        restricted transaction.--A person that is subject to a 
        regulation or an order issued under this section and blocks or 
        otherwise refuses to honor a restricted transaction (or a 
        transaction that such person reasonably believes to be a 
        restricted transaction) or as a member of a designated payment 
        system, relies on the policies and procedures of the payment 
        system in an effort to comply with regulations promulgated 
        under this section, shall not be liable to any party for such 
        action.
            ``(5) Enforcement.--
                    ``(A) In general.--This section shall be enforced 
                by the Federal functional regulators and the Federal 
                Trade Commission under applicable law in the manner 
                provided in section 505(a) of the Gramm-Leach-Bliley 
                Act (21 U.S.C. 6805(a)).
                    ``(B) Factors to be considered.--In considering any 
                enforcement action under this subsection against a 
                payment system or person described in subsection 
                (a)(2)(B), the Federal functional regulators and the 
                Federal Trade Commission shall consider the following 
                factors:
                            ``(i) The extent to which the person is 
                        extending credit or transmitting funds knowing 
                        the transaction is in connection with an 
                        unlawful Internet pharmacy request.
                            ``(ii) The history of the person in 
                        extending credit or transmitting funds knowing 
                        the transaction is in connection with an 
                        unlawful Internet pharmacy request.
                            ``(iii) The extent to which the person has 
                        established and is maintaining policies and 
                        procedures in compliance with regulations 
                        prescribed under this subsection.
                            ``(iv) The feasibility that any specific 
                        remedy prescribed can be implemented by the 
                        person without substantial deviation from 
                        normal business practice.
                            ``(v) The costs and burdens the specific 
                        remedy will have on the person.
    ``(f) Reports Regarding Internet-Related Violations of Federal and 
State Laws on Dispensing of Drugs.--The Secretary shall, pursuant to 
the submission of an application meeting criteria prescribed by the 
Secretary, make an award of a grant or contract to an entity with 
experience in developing and maintaining systems for the purpose of--
            ``(1) identifying Internet pharmacy websites that are not 
        licensed or that appear to be operating in violation of Federal 
        or State laws concerning the dispensing of drugs;
            ``(2) reporting such Internet pharmacy websites to State 
        medical licensing boards and State pharmacy licensing boards, 
        and to the Attorney General and the Secretary, for further 
        investigation; and
            ``(3) submitting, for each fiscal year for which the award 
        under this subsection is made, a report to the Secretary 
        describing investigations undertaken with respect to violations 
        described in paragraph (1).''.
    (b) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) (as amended by section 2(b)) is amended by 
adding at the end the following:
    ``(ii) The sale of a prescription drug, or the ownership or 
operation of an Internet pharmacy, in violation of section 511.
    ``(jj) The representation by advertisement, sales presentation, 
direct communication (including telephone, facsimile, or electronic 
mail), or otherwise by an Internet pharmacy, that a prescription drug 
may be obtained from the Internet pharmacy without a prescription, in 
violation of section 511.
    ``(kk) The acceptance of an advertisement from an Internet pharmacy 
by the provider of an interactive computer service, unless the provider 
has on file a copy of the license issued to the Internet pharmacy under 
section 511.''.
    (c) Links to Illegal Internet Pharmacies.--Section 302 of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 332) is amended by 
adding at the end the following:
    ``(c)(1) In the case of a violation of section 511 relating to an 
illegal Internet pharmacy, the district courts of the United States and 
the United States courts of the territories shall have jurisdiction to 
order a provider of an interactive computer service to remove, or 
disable access to, a website violating that section that resides on a 
computer server that the provider controls or operates.
    ``(2) Relief under paragraph (1)--
            ``(A) shall be available only after provision to the 
        provider of notice and an opportunity to appear;
            ``(B) shall not impose any obligation on the provider to 
        monitor its service or to affirmatively seek facts indicating 
        activity violating section 511; and
            ``(C) shall specify the provider to which the relief 
        applies.''.
    (d) Regulations.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary of Health and Human 
        Services shall promulgate interim final regulations that are 
        consistent with the Verified Internet Pharmacy Sites 
        certification program developed by the National Association of 
        Boards of Pharmacy to carry out the amendments made by this 
        section.
            (2) Effective date.--The requirement of licensure under 
        section 511 of the Federal Food, Drug, and Cosmetic Act (as 
        added by this section) shall take effect on the date determined 
        by the Secretary of Health and Human Services but in no event 
        later than 90 days after the effective date of the interim 
        final regulations under paragraph (1).
    (e) Return to Sender.--Section 801 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 381) is amended by adding at the end the 
following:
    ``(p) Unlicensed Internet Pharmacy.--If an Internet pharmacy is not 
licensed by the Secretary in accordance with section 511, any shipment 
of a prescription drug from such an Internet pharmacy to an individual 
shall be refused admission into the United States and the Secretary 
shall return the prescription drug, other than a prescription drug that 
is required to be destroyed, to the Internet pharmacy at the expense of 
the Internet pharmacy.
    ``(q) Licensed Internet Pharmacy.--If a shipment of a prescription 
drug from an Internet pharmacy licensed by the Secretary in accordance 
with section 511 to an individual is refused admission into the United 
States, the Secretary shall--
            ``(1) return the prescription drug, other than a 
        prescription drug that is required to be destroyed, to the 
        Internet pharmacy at the expense of the Internet pharmacy; and
            ``(2) provide the individual and the Internet pharmacy with 
        a written notice that informs the individual and the Internet 
        pharmacy of the refusal and of the reason for the refusal.''.

SEC. 5. ADMINISTRATIVE DETENTION AND TEMPORARY HOLD.

    (a) In General.--The Federal Food, Drug, and Cosmetic Act is 
amended by adding after section 815 (as added by section 9) the 
following:

``SEC. 816. ADMINISTRATIVE DETENTION.

    ``(a) Administrative Detention of Prescription Drugs.--
            ``(1) Detention authority.--
                    ``(A) In general.--An officer or qualified employee 
                of the Food and Drug Administration may order the 
                detention, in accordance with this subsection, of any 
                prescription drug that is found during an inspection, 
                examination, or investigation under this Act conducted 
                by the officer or qualified employee, if the officer or 
                qualified employee has credible evidence or information 
                indicating that the prescription drug presents a risk 
                to the public health.
                    ``(B) Approval.--A prescription drug may be 
                detained under subparagraph (A) only if the Secretary 
                or an official designated by the Secretary approves the 
                order of detention.
            ``(2) Period of detention.--A prescription drug may be 
        detained under paragraph (1) for a reasonable period, not to 
        exceed 20 days, unless a greater period, not to exceed 30 days, 
        is necessary, to enable the Secretary to commence an action 
        under this subsection or section 302.
            ``(3) Security of detained article.--
                    ``(A) In general.--An order under paragraph (1) 
                with respect to a prescription drug--
                            ``(i) may require that the prescription 
                        drug be labeled or marked as detained; and
                            ``(ii) shall require that the prescription 
                        drug be removed to a secure facility, as 
                        appropriate.
                    ``(B) No transfer.--A prescription drug subject to 
                an order under paragraph (1) shall not be transferred 
                by any person from the place at which the prescription 
                drug is ordered detained or from the place to which the 
                prescription drug is removed, until released by the 
                Secretary or until the expiration of the detention 
                period applicable under the order, whichever occurs 
                first.
                    ``(C) Effect of paragraph.--This paragraph does not 
                authorize the delivery of a prescription drug pursuant 
                to the execution of a bond while the prescription drug 
                is subject to an order under paragraph (1).
                    ``(D) Effect of bonding provision.--Section 801(b) 
                does not authorize the delivery of a prescription drug 
                pursuant to the execution of a bond while the 
                prescription drug is subject to an order under 
                paragraph (1).
            ``(4) Appeal of detention order.--
                    ``(A) In general.--With respect to a prescription 
                drug detained under paragraph (1), any person that 
                would be entitled to be a claimant for the prescription 
                drug if the prescription drug were seized under 
                paragraph (1) may appeal the order of detention to the 
                Secretary.
                    ``(B) Action by the secretary.--Not later than 5 
                days after an appeal is filed, the Secretary, after 
                providing opportunity for an informal hearing, shall 
                confirm or terminate the order, and confirmation by the 
                Secretary shall be considered to be a final agency 
                action for purposes of section 702 of title 5, United 
                States Code.
                    ``(C) Failure to act.--If, during the 5-day period 
                specified in subparagraph (B), the Secretary fails to 
                provide an opportunity for hearing or to confirm or 
                terminate the order, the order shall be deemed to be 
                terminated.
                    ``(D) Effect of commencement of court action.--The 
                process under this paragraph for the appeal of an order 
                under paragraph (1) with respect to a prescription drug 
                terminates if the Secretary commences an action under 
                subsection (a) or section 302 regarding the 
                prescription drug.
    ``(b) Effect of Section.--Nothing in this section applies to a 
prescription drug imported by an individual under section 812 or to a 
commercial transaction conducted between an Internet pharmacy and an 
individual.''.
    (b) Temporary Hold at Port of Entry.--Section 801 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 381) (as amended by section 
4(e)) is amended by adding at the end the following:
    ``(r) Temporary Hold at Port of Entry.--
            ``(1) In general.--If an officer or qualified employee of 
        the Food and Drug Administration has credible evidence or 
        information indicating that a prescription drug presents a risk 
        to the public health, and the officer or qualified employee is 
        unable to inspect, examine, or investigate the prescription 
        drug upon the prescription drug's being offered for import at a 
        port of entry into the United States, the officer or qualified 
        employee shall request the Secretary of the Treasury to hold 
        the prescription drug at the port of entry for a reasonable 
        period of time, not to exceed 24 hours, for the purpose of 
        enabling the Secretary to inspect, examine, or investigate the 
        prescription drug as appropriate.
            ``(2) Approval.--
                    ``(A) In general.--An officer or qualified employee 
                of the Food and Drug Administration may make a request 
                under paragraph (1) only if the Secretary or an 
                official designated by the Secretary approves the 
                request.
                    ``(B) Designees.--An official may not be designated 
                under subparagraph (A) unless the official is the 
                director of the district under this Act in which the 
                prescription drug is located, or is an official senior 
                to that director.
            ``(3) Notification.--With respect to a prescription drug 
        for which a request under paragraph (1) is made, the Secretary, 
        promptly after the request is made, shall notify the State in 
        which the port of entry involved is located that the request 
        has been made, and as applicable, that the prescription drug, 
        is being held under this subsection.
            ``(4) Removal.--A prescription drug held under paragraph 
        (1) shall be removed to a secure facility, as appropriate.
            ``(5) No transfer.--During the period in which a 
        prescription drug is held under this subsection, the 
        prescription drug shall not be transferred by any person from 
        the port of entry into the United States for the prescription 
        drug or from the secure facility to which the prescription drug 
        has been removed.
            ``(6) Effect of bonding provision.--Subsection (b) does not 
        authorize the delivery of a prescription drug held under this 
        subsection pursuant to the execution of a bond while the 
        prescription drug is held under this subsection.
            ``(7) Effect of subsection.--Nothing in this subsection 
        applies to a prescription drug imported by an individual under 
        section 812 or to a commercial transaction conducted between an 
        Internet pharmacy and an individual.''.
    (c) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) (as amended by section 4(b)) is amended by 
adding at the end the following:
    ``(ll) The transfer of a prescription drug in violation of an order 
under section 816, or the removal or alteration of any mark or label 
required by the order to identify the prescription drug as detained.''.

SEC. 6. SUSPENSION.

    (a) In General.--The Federal Food, Drug, and Cosmetic Act is 
amended by adding after section 816 (as added by section 5) the 
following:

``SEC. 817. SUSPENSION OF IMPORTATION.

    ``(a) Prescription Drug.--If the Secretary determines that the 
importation of a particular prescription drug or particular dosage form 
of a prescription drug into the United States presents a risk to the 
public health, the Secretary may immediately order the suspension of 
the importation of the particular prescription drug or particular 
dosage form of the prescription drug.
    ``(b) Suspension.--If the Secretary determines that a drug 
importation facility, pharmacy, Internet pharmacy, or wholesaler is 
engaged in a pattern of importing or offering for importation a 
prescription drug into the United States in violation of any of the 
requirements of this Act, the Secretary may immediately order the 
suspension of that person from engaging in the importation or offering 
for importation of prescription drugs into the United States.
    ``(c) Canada or Permitted Country.--If the Secretary determines 
that there is a pattern of prescription drugs being imported or offered 
for importation into the United States from Canada or a permitted 
country in violation of any of the requirements of this Act, the 
Secretary may immediately order the suspension of the importation or 
offering for importation into the United States of prescription drugs 
from Canada or that permitted country, as appropriate.
    ``(d) Appeal of Suspension Order.--
            ``(1) In general.--
                    ``(A) Prescription drugs.--With respect to the 
                importation of a prescription drug, the importation of 
                which is suspended under subsection (a), any person 
                that would be entitled to be a claimant for the 
                prescription drug may appeal the suspension order to 
                the Secretary.
                    ``(B) Suspended persons.--With respect to a drug 
                importation facility, pharmacy, Internet pharmacy, or 
                wholesaler subject to a suspension order under 
                subsection (b) or (c), the drug importation facility, 
                pharmacy, Internet pharmacy or wholesaler may appeal 
                the suspension order to the Secretary.
            ``(2) Action by the secretary.--Not later than 30 days 
        after an appeal is filed, the Secretary, after providing 
        opportunity for an informal hearing, shall confirm or terminate 
        the order.
            ``(3) Failure to act.--If, during the 30-day period 
        specified in paragraph (2), the Secretary fails to provide an 
        opportunity for a hearing or to confirm or terminate the order, 
        the order shall be deemed to be terminated.
    ``(e) No Judicial Review.--An order under this section shall not be 
subject to judicial review.
    ``(f) Effect of Section.--Nothing in this section applies to a 
prescription drug imported by an individual under section 812 or to a 
commercial transaction conducted between an Internet pharmacy and an 
individual.''.
    (b) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) (as amended by section 5(c)) is amended by 
adding at the end the following:
    ``(mm) The importation or offering for importation of a 
prescription drug in violation of an order under section 817.''.

SEC. 7. DEBARMENT FOR REPEATED OR SERIOUS PRESCRIPTION DRUG IMPORTATION 
              VIOLATIONS.

    (a) Debarment Authority.--
            (1) Permissive debarment.--Section 306(b)(1) of the Federal 
        Food, Drug, and Cosmetic Act (21 U.S.C. 335a(b)(1)) is 
        amended--
                    (A) in subparagraph (B), by striking ``or'' at the 
                end;
                    (B) in subparagraph (C), by striking the period at 
                the end and inserting ``, or''; and
                    (C) by adding at the end the following:
                    ``(D) a person from importing a prescription drug 
                or offering a prescription drug for importation into 
                the United States.''.
            (2) Amendment regarding debarment grounds.--Section 306(b) 
        of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 335a(b)) 
        is amended--
                    (A) by redesignating paragraph (4) as paragraph 
                (5); and
                    (B) by inserting after paragraph (3) the following:
            ``(4) Persons subject to permissive debarment; prescription 
        drug importation.--
                    ``(A) In general.--A person is subject to debarment 
                under paragraph (1)(D) if--
                            ``(i) the person has been convicted of a 
                        felony for conduct relating to the importation 
                        into the United States of any prescription 
                        drug; or
                            ``(ii) the person has engaged in a pattern 
                        of importing or offering for import a 
                        prescription drug that presents a risk to the 
                        public health.
                    ``(B) Effect of paragraph.--Nothing in this 
                paragraph applies to a prescription drug imported by an 
                individual under section 812 or to a commercial 
                transaction conducted between an Internet pharmacy and 
                an individual.''.
    (b) Conforming Amendments.--Section 306 of the Federal Food, Drug, 
and Cosmetic Act (21 U.S.C. 335a) is amended--
            (1) in subsection (b), by striking the subsection heading 
        and inserting the following:
    ``(b) Permissive Debarment; Certain Drug Applications; Imports.--
'';
            (2) in subsection (c)(2)(A)(iii), by striking ``paragraph 
        (2) or (3) of subsection (b)'' and inserting ``paragraph (2), 
        (3), or (4) of subsection (b)''; and
            (3) in subsection (d)(3)--
                    (A) in subparagraph (A)(i), by striking ``or 
                paragraph (2)(A) or (3) of subsection (b)'' and 
                inserting ``paragraph (2)(A), (3), or (4) of subsection 
                (b)'';
                    (B) in clauses (i) and (ii) of subparagraph (B), by 
                striking ``or subsection (b)(3)'' and inserting 
                ``paragraph (3) or (4) of subsection (b)''; and
                    (C) in subparagraph (B)(ii), by striking ``or the 
                food importation process, as the case may be'' and 
                inserting ``, or the food or prescription drug 
                importation process, as the case may be''.
    (c) Effective Date.--Section 306(l)(2) of the Federal Food, Drug, 
and Cosmetic Act (21 U.S.C. 335a(l)(2)) is amended--
            (1) in the first sentence, by striking ``and subsection 
        (b)(3)(A)'' and inserting ``subsection (b)(3)(A), and 
        subsection (b)(4)(A)''; and
            (2) in the second sentence, by inserting ``, subsection 
        (b)(4)(B),'' after ``subsection (b)(3)(B)''.
    (d) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) (as amended by section 6(b)) is amended by 
adding at the end the following:
    ``(nn) The importing or offering for importation into the United 
States of a prescription drug by, with the assistance of, or at the 
direction of a person debarred under section 306(b)(4).''.
    (e) Importation by Debarred Persons.--Section 801 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 381) (as amended by section 
5(b)) is amended by adding at the end the following:
    ``(s) Importation of Prescription Drugs by Debarred Persons.--
            ``(1) In general.--If a prescription drug is imported or 
        offered for importation into the United States, and the 
        importer, owner, or consignee of the prescription drug is a 
        person that has been debarred under section 306(b)(4), the 
        prescription drug--
                    ``(A) shall be held at the port of entry for the 
                prescription drug; and
                    ``(B) may not be delivered to the person.
            ``(2) Effect of bonding provision.--Subsection (b) does not 
        authorize the delivery of a prescription drug pursuant to the 
        execution of a bond while the prescription drug is held under 
        this subsection.
            ``(3) Removal.--A prescription drug held under this 
        subsection shall be removed to a secure facility, as 
        appropriate.
            ``(4) No transfer.--During a period in which a prescription 
        drug is held under this subsection, the prescription drug shall 
        not be transferred by any person from the port of entry into 
        the United States for the prescription drug or from the secure 
        facility to which the prescription drug has been removed.
            ``(5) Permissible delivery.--A prescription drug held under 
        this subsection may be delivered to a person that is not a 
        debarred person under section 306(b)(4) if the person 
        affirmatively establishes, at the expense of the person, that 
        the prescription drug complies with the requirements of this 
        Act, as determined by the Secretary.''.

SEC. 8. REGISTRATION OF PRESCRIPTION DRUG IMPORTATION FACILITIES.

    (a) Registration of Certain Importers.--The Federal Food, Drug, and 
Cosmetic Act is amended by adding after section 813 (as added by 
section 2) the following:

``SEC. 814. REGISTRATION OF CERTAIN IMPORTERS.

    ``(a) In General.--A drug importation facility, pharmacy, Internet 
pharmacy, or wholesaler engaged in the importation or offering for 
importation of prescription drugs into the United States, or in the 
dispensing of such drugs, shall register with the Secretary in 
accordance with this section.
    ``(b) Registration.--
            ``(1) In general.--To register, the owner, operator, or 
        agent in charge of a drug importation facility, pharmacy, 
        Internet pharmacy, or wholesaler shall submit to the Secretary 
        a registration that discloses--
                    ``(A) the name and address of each drug importation 
                facility, pharmacy, Internet pharmacy, or wholesaler at 
                which, and all trade names under which, the registrant 
                conducts business;
                    ``(B) the name of each prescription drug to be 
                imported into the United States by each drug 
importation facility, pharmacy, Internet pharmacy, or wholesaler; and
                    ``(C) the name and address of an agent for service 
                of process in the United States.
            ``(2) Change in information.--The registrant shall notify 
        the Secretary in a timely manner of any change in the 
        information provided under paragraph (1).
            ``(3) Procedure.--Not later than 60 days after receipt of a 
        completed registration under paragraph (1), the Secretary 
        shall--
                    ``(A) assign a registration number to each 
                registered drug importation facility, pharmacy, 
                Internet pharmacy, and wholesaler; and
                    ``(B) notify the registrant of the receipt of the 
                registration.
            ``(4) List.--
                    ``(A) In general.--The Secretary shall compile, 
                maintain, and periodically update a list of 
                registrants.
                    ``(B) Availability.--The Secretary shall make the 
                list described under subparagraph (A) and information 
                submitted by a registrant under paragraph (1) available 
                to the public on an Internet website and through a 
                toll-free telephone number.
    ``(c) Electronic Filing.--
            ``(1) In general.--For the purpose of reducing paperwork 
        and reporting burdens, the Secretary shall provide for, and 
        require the use of, electronic methods of submitting to the 
        Secretary registrations required under this section and shall 
        provide for electronic methods of receiving the registrations.
            ``(2) Authentication.--In providing for the electronic 
        submission of such registrations under this section, the 
        Secretary shall ensure that adequate authentication protocols 
        are used to allow identification of the registrant and 
        validation of the data as appropriate.
    ``(d) Effect of Section.--
                    ``(1) Authority.--Nothing in this section 
                authorizes the Secretary to require an application, 
                review, or licensing process for a drug importation 
                facility, pharmacy, or wholesaler.
                    ``(2) Importation by individuals.--Nothing in this 
                section applies to a prescription drug imported by an 
                individual under section 812 or to a commercial 
                transaction conducted between an Internet pharmacy and 
                an individual.''.
    (b) Regulations.--
            (1) In general.--Not later than 1 year after the date of 
        enactment of this Act, the Secretary of Health and Human 
        Services shall promulgate regulations to carry out section 814 
        of the Federal Food, Drug, and Cosmetic Act (as added by this 
        section).
            (2) Effective date.--The requirement of registration under 
        section 814 of the Federal Food, Drug, and Cosmetic Act takes 
        effect--
                    (A) on the effective date of the final regulations 
                under paragraph (1); or
                    (B) if the final regulations have not been made 
                effective as of the expiration of that period, on the 
                date that is 1 year after the date of enactment of this 
                Act, subject to compliance with the final regulations 
                when the final regulations are made effective.
    (c) Importation; Failure to Register.--Section 801 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 381) (as amended by section 
7(e)) is amended by adding at the end the following:
    ``(t) Failure to Register.--
            ``(1) In general.--If a drug importation facility, 
        pharmacy, Internet pharmacy, or wholesaler engaged in the 
        importation or offering for importation of prescription drugs 
        into the United States has not submitted a registration to the 
        Secretary in accordance with section 814, a prescription drug 
        that is being imported or offered for importation into the 
        United States shall not be delivered to the importer, owner, or 
        consignee of the prescription drug until the drug importation 
        facility, pharmacy, Internet pharmacy, or wholesaler is 
        registered in accordance with section 814.
            ``(2) Effect of subsection (b).--Subsection (b) does not 
        authorize the delivery of the prescription drug pursuant to the 
        execution of a bond while the prescription drug is held under 
        this subsection.
            ``(3) Removal.--A prescription drug held under this 
        subsection shall be removed to a secure facility, as 
        appropriate.
            ``(4) No transfer.--During the period in which a 
        prescription drug is held under this subsection, the 
        prescription drug shall not be transferred by any person from 
        the port of entry into the United States for the prescription 
        drug or from the secure facility to which the prescription drug 
        has been removed.''.
    (d) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) (as amended by section 7(d)) is amended by 
adding at the end the following:
    ``(oo) The failure of a drug importation facility, pharmacy, 
Internet pharmacy, or wholesaler engaged in the importation or offering 
for importation of prescription drugs into the United States, or in the 
dispensing of such drugs, to register in accordance with section 
814.''.

SEC. 9. MAINTENANCE AND INSPECTION OF RECORDS FOR PRESCRIPTION DRUGS.

    The Federal Food, Drug, and Cosmetic Act is amended by adding after 
section 814 (as added by section 8) the following:

``SEC. 815. MAINTENANCE AND INSPECTION OF RECORDS FOR PRESCRIPTION 
              DRUGS.

    ``(a) In General.--The Secretary may by regulation establish 
requirements relating to the establishment and maintenance, for not 
longer than 2 years, of records by--
            ``(1) a drug importation facility, pharmacy, Internet 
        pharmacy, or wholesaler engaged in the importation of 
        prescription drugs into the United States, or in the dispensing 
        of such drugs; and
            ``(2) any person that processes, packages, distributes, 
        receives, holds, or transports a prescription drug imported 
        under this subchapter.
    ``(b) Inspection.--
            ``(1) In general.--If the Secretary has reason to believe 
        that a prescription drug imported under this subchapter 
        presents a risk to the public health, the drug importation 
        facility, pharmacy, Internet pharmacy, or wholesaler that 
        imports the prescription drug, and each person that processes, 
        packages, distributes, receives, holds, or transports the 
        prescription drug shall, at the request of an officer or 
        employee duly designated by the Secretary, permit the officer 
        or employee, upon presentation of appropriate credentials and a 
        written notice to such pharmacy or person, at reasonable times, 
        within reasonable limits and in a reasonable manner, to have 
        access to and copy all records relating to the prescription 
        drug that are needed to enable the Secretary to determine 
        whether the prescription drug presents a risk to the public 
        health.
            ``(2) Applicability.--Paragraph (1) applies to all records 
        maintained by or on behalf of the drug importation facility, 
        pharmacy, Internet pharmacy, or wholesaler or such other person 
        in any format (including paper and electronic formats) and at 
        any location.
    ``(c) Protection of Sensitive Information.--The Secretary shall 
take appropriate measures to ensure that there are in effect effective 
procedures to prevent the unauthorized disclosure of any trade secret 
or confidential information that is obtained by the Secretary under 
this section or any commercial or financial information that is 
privileged or confidential.
    ``(d) Effect of Section.--Nothing in this section applies to a 
prescription drug imported by an individual under section 812 or to a 
commercial transaction conducted between an Internet pharmacy and an 
individual.''.

SEC. 10. ADVANCE NOTICE OF IMPORTED PRESCRIPTION DRUG SHIPMENTS.

    (a) In General.--Section 801 of the Federal Food, Drug, and 
Cosmetic Act (as amended by section 8(b)) is amended by adding at the 
end the following:
    ``(u) Advance Notice of Imported Prescription Drug Shipments.--
            ``(1) In general.--For purposes of enabling the Secretary 
        to inspect at ports of entry a prescription drug that is being 
        imported or offered for importation into the United States, the 
        person importing or offering for importation the prescription 
        drug shall, in advance, provide to the Secretary a notice that 
        includes--
                    ``(A) the established name (as defined by section 
                502(e)), dosage form, and quantity of the prescription 
                drug;
                    ``(B) the name of the shipper of the prescription 
                drug;
                    ``(C) the name of the country from which the 
                prescription drug originates;
                    ``(D) the country from which the prescription drug 
                is shipped;
                    ``(E) the name of the port of entry of the 
                prescription drug;
                    ``(F) documentation from the drug importation 
                facility located in Canada or a permitted country 
                specifying--
                            ``(i) the original source of the 
                        prescription drug; and
                            ``(ii) the quantity of each lot of the 
                        prescription drug originally received by the 
                        facility from that source;
                    ``(G) the lot or control number assigned to the 
                prescription drug by the manufacturer of the 
                prescription drug;
                    ``(H) the name, address, telephone number, and 
                professional license number of the drug importation 
                facility located in Canada or a permitted country; and
                    ``(I) certification from the drug importation 
                facility located in a foreign country or from the 
                manufacturer of the prescription drug that the 
                prescription drug--
                            ``(i) is approved for marketing in the 
                        United States and is not adulterated or 
                        misbranded; and
                            ``(ii) meets all labeling requirements 
                        under this Act.
            ``(2) Refusal of admission.--A prescription drug imported 
        or offered for importation without submission of a notice under 
        paragraph (1) shall be refused admission into the United 
        States.
            ``(3) Period of advance notice.--The period in which the 
        notice under paragraph (1) is required to be made in advance of 
        the time of the importation of a prescription drug or the 
        offering of a prescription drug for importation shall be not 
        less than 24 hours and not more than 5 days.
            ``(4) Failure to provide notice.--
                    ``(A) In general.--If a prescription drug is being 
                imported or offered for importation into the United 
                States and notice is not provided in advance in 
                accordance with paragraph (1), the prescription drug 
                shall be held at the port of entry for the prescription 
                drug, and may not be delivered to the importer, owner, 
                or consignee of the prescription drug, until the notice 
                is submitted to the Secretary and the Secretary 
                examines the notice and determines that the notice is 
                in accordance with the requirements under paragraph 
                (1).
            ``(5) Effect of bonding provision.--Subsection (b) does not 
        authorize the delivery of a prescription drug pursuant to the 
        execution of a bond while the prescription drug is held under 
        this subsection.
            ``(6) Removal.--A prescription drug held under this 
        subsection shall be removed to a secure facility, as 
        appropriate.
            ``(7) No transfer.--During a period in which a prescription 
        drug is held under this subsection, the prescription drug shall 
        not be transferred by any person from the port of entry into 
        the United States for the article or from the secure facility 
to which the prescription drug has been removed.
            ``(8) Effect of subsection.--
                    ``(A) Authority.--This subsection does not limit 
                the authority of the Secretary to obtain information 
                under any other provision of this Act.
                    ``(B) Importation by individuals.--Nothing in this 
                subsection applies to a prescription drug imported by 
                an individual under section 812 or to a commercial 
                transaction conducted between an Internet pharmacy and 
                an individual.''.
    (b) Prohibited Act.--Section 301 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 331) (as amended by section 8(c)) is amended by 
adding at the end the following:
    ``(pp) The failure to submit prior notice of the importation of a 
prescription drug in violation of section 801(s).''.

SEC. 11. AUTHORITY TO MARK PRESCRIPTION DRUGS REFUSED ADMISSION INTO 
              THE UNITED STATES.

    (a) In General.--Section 801 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 381) (as amended by section 10(a)) is amended 
by adding at the end the following:
    ``(v) Prescription Drugs Refused Admission.--
            ``(1) In general.--If a prescription drug has been refused 
        admission under subsection (a), other than such a prescription 
        drug that is required to be destroyed, the Secretary may 
        require the owner or consignee of the prescription drug to 
        affix to the container of the prescription drug a label that 
        clearly and conspicuously bears the statement: `UNITED STATES: 
        REFUSED ENTRY'.
            ``(2) Expenses.--All expenses in connection with affixing a 
        label under paragraph (1)--
                    ``(A) shall be paid by the owner or consignee of 
                the prescription drug; and
                    ``(B) in default of such payment, shall constitute 
                a lien against future importations made by the owner or 
                consignee.
            ``(3) Effective period.--A requirement under paragraph (1) 
        with respect to a prescription drug remains in effect until the 
        Secretary determines that the prescription drug has been 
        brought into compliance with this Act.
            ``(4) Effect of subsection.--Nothing in this subsection 
        applies to a prescription drug imported by an individual under 
        section 812 or to a commercial transaction conducted between an 
        Internet pharmacy and an individual.''.
    (b) Misbranded Prescription Drugs.--Section 502 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 352) is amended by adding at 
the end the following:
    ``(w) If--
            ``(1) it is a prescription drug refused admission into the 
        United States that fails to bear a label required by the 
        Secretary under section 801(v);
            ``(2) the Secretary finds that the prescription drug 
        presents a risk to the public health; and
            ``(3) on or after notifying the owner or consignee of the 
        prescription drug that the label is required under section 
        801(v), the Secretary informs the owner or consignee that the 
        prescription drug presents such a risk.''.
    (c) Rule of Construction.--With respect to a prescription drug that 
is imported or offered for importation into the United States, nothing 
in this section limits the authority of the Secretary of Health and 
Human Services or the Secretary of the Treasury to require the marking 
of prescription drugs refused admission under any other provision of 
law.

SEC. 12. PROHIBITION OF PORT SHOPPING.

    Section 502 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
352) (as amended by section 11(b)) is amended by adding at the end the 
following:
    ``(x) Port Shopping.--
            ``(1) In general.--If--
                    ``(A) it is a prescription drug imported or offered 
                for importation into the United States; and
                    ``(B) the prescription drug has previously been 
                refused admission under section 801(a);
        unless the person reoffering the prescription drug 
        affirmatively establishes, at the expense of the owner or 
        consignee of the prescription drug, that the prescription drug 
        complies with the applicable requirements of this Act, as 
        determined by the Secretary.
            ``(2) Effect of paragraph.--Nothing in this paragraph 
        applies to importation of a prescription drug under section 812 
        or to a commercial transaction conducted between an Internet 
        pharmacy and an individual.''.

SEC. 13. AUTHORITY TO COMMISSION OTHER FEDERAL AND STATE OFFICIALS TO 
              CONDUCT INSPECTIONS.

    Section 702(a) of the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 372(a)) is amended--
            (1) by redesignating paragraphs (3) and (4) as paragraphs 
        (5) and (6), respectively; and
            (2) inserting after paragraph (2) the following:
            ``(3)(A) The Secretary, pursuant to a memorandum of 
        understanding between the Secretary and the head of another 
        Federal agency, may conduct examinations and investigations for 
        the purposes of enforcing compliance with the amendments made 
        by the Safe IMPORT Act of 2004 through the officers and 
        employees of the other agency.
            ``(B) A memorandum of understanding under subparagraph (A) 
        shall include--
                    ``(i) provisions to ensure adequate training of 
                officers and employees to conduct the examinations and 
                investigations; and
                    ``(ii) provisions regarding reimbursement that may, 
                in the discretion of the head of the other agency, 
                require reimbursement, in whole or in part, from the 
                Secretary for the examinations or investigations 
                performed under this paragraph by the officers or 
                employees of the other agency.
            ``(C) A memorandum of understanding under subparagraph (A) 
        shall be effective only with respect to examinations or 
        inspections at facilities or other locations that are jointly 
regulated by the Secretary and the other agency.
            ``(D) Not later than 60 days after the end of each fiscal 
        year in which the head a Federal agency carries out 1 or more 
        examinations or inspections under a memorandum of understanding 
        under subparagraph (A), the Secretary and the agency head shall 
        submit to the Committee on Health, Education, Labor, and 
        Pensions of the Senate and to the Committee on Energy and 
        Commerce of the House of Representatives, a report that 
        discloses, for that year--
                    ``(i) the number of officers or employees that 
                carried out 1 or more programs, projects, or activities 
                under the memorandum of understanding;
                    ``(ii) the number of additional articles that were 
                inspected or examined as a result of the memorandum of 
                understanding; and
                    ``(iii) the number of additional examinations or 
                investigations that were carried out pursuant to the 
                memorandum of understanding.
            ``(4)(A) The Secretary may enter into a contract with a 
        State to use the State Board of Pharmacy personnel of the State 
        to conduct examinations and inspection for the purpose of 
        carrying out the amendments made by the Safe IMPORT Act of 
        2004.
            ``(B) A contract entered into under subparagraph (A) 
        shall--
                    ``(i) ensure adequate training of officers and 
                employees to conduct the examinations and 
                investigations; and
                    ``(ii) be effective only with respect to 
                examinations or inspections of drug importation 
                facilities, pharmacies, Internet pharmacies, and 
                wholesalers located in the State.''.

SEC. 14. USER FEES RELATING TO PRESCRIPTION DRUG IMPORTATION.

    Subchapter C of chapter VII of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 397f et seq.) is amended by adding at the end the 
following:

        ``PART 5--FEES RELATING TO PRESCRIPTION DRUG IMPORTATION

``SEC. 740A. FEES RELATING TO PRESCRIPTION DRUG IMPORTATION.

    ``(a) Registration Fee.--The Secretary shall establish a user fee 
program under which a drug importation facility, pharmacy, Internet 
pharmacy, or wholesaler registering with the Secretary under section 
814 shall be required to pay a fee to the Secretary.
    ``(b) Collection.--
            ``(1) Collection on initial registration.--A fee under this 
        section shall be payable for the fiscal year in which the drug 
        importation facility, pharmacy, Internet pharmacy, or 
        wholesaler first registers under section 814 (or reregisters 
        under that section if that person has withdrawn its 
        registration and subsequently reregisters).
            ``(2) Collection in subsequent years.--After the fee is 
        paid for that fiscal year, the fee shall be payable on or 
        before October 1 of each year.
            ``(3) One fee per facility.--The fee shall be paid only 
        once for each drug importation facility, pharmacy, Internet 
        pharmacy, or wholesaler registered for a fiscal year in which 
        the fee is payable.
    ``(c) Fee Amount.--The amount of the fee shall be determined each 
year by the Secretary and shall be based on the anticipated costs to 
the Secretary of enforcing the amendments made by the Safe IMPORT Act 
of 2004 in the subsequent fiscal year.
    ``(d) Use of Fees.--The fees collected under this section shall be 
used, without further appropriation, to enforce the amendments made by 
the Safe IMPORT Act of 2004.
    ``(e) Annual Fee Setting.--The Secretary shall establish, 60 days 
before the beginning of each fiscal year beginning after September 30, 
2004, for that fiscal year, registration fees.
    ``(f) Effect of Failure To Pay Fees.--
            ``(1) Due date.--A fee payable under this section shall be 
        paid by the date that is 30 days after the date on which the 
        fee is due.
            ``(2) Failure to pay.--If a registered drug importation 
        facility, pharmacy, Internet pharmacy, or wholesaler subject to 
        a fee under this section fails to pay the fee, the Secretary 
        shall not permit the drug importation facility pharmacy, 
        Internet pharmacy, or wholesaler to engage in importation or 
        offering for importation prescription drugs under this Act 
        until all such fees owed by that person are paid.
    ``(g) Reports.--
            ``(1) Fee establishment.--Not later than 60 days before 
        each fiscal year, the Secretary shall--
                    ``(A) publish user fees under this section for that 
                fiscal year;
                    ``(B) hold a meeting at which the public may 
                comment on the recommendations; and
                    ``(C) provide for a period of 30 days for the 
                public to provide written comments on the 
                recommendations.
            ``(2) Performance and fiscal report.--Beginning with fiscal 
        year 2005, not later than 60 days after the end of each fiscal 
        year during which fees are collected under this section, the 
        Secretary shall submit to the Committee on Health, Education, 
        Labor, and Pensions of the Senate and the Committee on Energy 
        and Commerce of the House of Representatives a report that 
        describes--
                    ``(A) implementation of the user fee authority 
                during the fiscal year; and
                    ``(B) the use by the Secretary of the fees 
                collected during the fiscal year for which the report 
                is made.''.

SEC. 15. ANTICOUNTERFEITING PROVISIONS.

    (a) Required Records.--Section 503(e) of the Federal Food, Drug, 
and Cosmetic Act (21 U.S.C. 353(e)) is amended by striking paragraph 
(1) and inserting the following: ``(1) A distributor of record that is 
engaged in the wholesale distribution of a drug subject to subsection 
(b), shall--
            ``(A) before each wholesale distribution of the drug--
                    ``(i) with respect to each wholesale distribution 
                of a drug subject to subsection (b), provide the person 
                that receives the drug a statement that identifies the 
                immediately previous distributor of record from which 
                the drug was purchased; and
                    ``(ii) with respect to a drug subject to subsection 
                (b) that is imported to the United States, provide the 
                person that receives the drug a statement (in such form 
                and containing such information as the Secretary may 
                require) identifying each prior sale, purchase, or 
                trade of the drug (including the date of transmission 
                and the names and addresses of all parties to the 
                transaction); and
            ``(B) create, maintain for 2 years, and make available to 
        the Secretary for inspection at reasonable time, records that--
                    ``(i) with respect to each wholesale distribution 
                of a drug subject to subsection (b), identifies--
                            ``(I) the immediately previous distributor 
                        of record from which the drug was purchased; 
                        and
                            ``(II) the immediately subsequent 
                        distributor of record to which the drug was 
                        sold or otherwise transferred; and
                    ``(ii) with respect to a drug subject to subsection 
                (b) that is imported to the United States, identifies--
                            ``(I) each previous distributor of record 
                        from which the drug was purchased or otherwise 
                        transferred; and
                            ``(II) each subsequent distributor of 
                        record to which the drug was sold or otherwise 
                        transferred, to the extent feasible.''.
    (b) Electronic Track and Trace Technology.--Not later than December 
31, 2007, the Secretary of Health and Human Services shall require the 
adoption and use of electronic track and trace technology for a 
prescription drug at the case and pallet level that will identify each 
sale, purchase, or trade of that case or pallet (including the date of 
transmission and the names and addresses of all parties to the 
transaction) .
    (c) Distributors of Record.--Section 503(e) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 353(e)) is amended by striking 
paragraph (3) and inserting the following:
    ``(3) For the purposes of this subsection and subsection (d)--
            ``(A) the term `distributor of record'--
                    ``(i) means a person that takes title to or 
                possession of a drug subject to subsection (b) from 
                manufacture to retail sale;
                    ``(ii) includes a person that manufacturers, 
                processes, packs, distributes, receives, holds, 
                imports, or offers for importation a drug subject to 
                subsection (b); and
                    ``(iii) does not include a transporter;
            ``(B) the term `transporter' means the United States Postal 
        Service, or equivalent governmental service of a foreign 
        country, or a private carrier engaged in the business of 
        transporting packages for hire; and
            ``(C) the term `wholesale distribution' means the 
        distribution of a drug subject to subsection (b) to other than 
        the consumer or patient but not including an intracompany sale 
        or distribution of a drug described in subsection (c)(3)(B).''.
    (d) Anticounterfeiting Programs.--Section 503(e) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 353(e)) is amended by adding at 
the end the following:
    ``(4) The Secretary shall--
            ``(A) establish a network to be known as the `Counterfeit 
        Alert Network' for the purpose of providing prompt notification 
        to health professionals and the public of counterfeit drugs 
        subject to subsection (b);
            ``(B)(i) develop and publish an Internet accessible-
        reference document to facilitate the positive identification by 
        health professionals and regulatory agency personnel of 
        prescription drugs marketed in the United States and Canada; 
        and
            ``(ii) update the materials described under clause (i) 
        quarterly and when a new permitted country is designated by the 
        Secretary;
            ``(C) develop and publish educational materials to health 
        professionals and consumers identify and report cases of 
        counterfeit drugs subject to subsection (b);
            ``(D) develop and publish secure business practice 
        guidelines for the sale and distribution of such drugs in 
        cooperation with members of a drug supply chain; and
            ``(E) in cooperation with the National Association of 
        Boards of Pharmacy, develop and publish revised model rules for 
        licensure of drug wholesalers for adoption by the States.''.

SEC. 16. CONFORMING AMENDMENTS.

     (a) Section 1006 of the Controlled Substances Import and Export 
Act (21 U.S.C. 956) is repealed.
    (b) The Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et 
seq.) is amended--
            (1) in section 301(aa)--
                    (A) by striking ``section 804'' and inserting 
                ``subchapter B of chapter VIII''; and
                    (B) by striking ``such section'' each place it 
                appears and inserting ``that subchapter'';
            (2) in section 801(d)(1), by striking ``section 804'' and 
        inserting ``subchapter B''; and
            (3) by striking section 804.
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