[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 109 Introduced in Senate (IS)]






109th CONGRESS
  1st Session
                                 S. 109

       Entitled the ``Pharmaceutical Market Access Act of 2005''.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 24, 2005

Mr. Vitter (for himself, Mr. Salazar, Mr. Thune, and Mr. DeMint) 
        introduced the following bill; which was read twice and 
        referred to the Committee on Health, Education, Labor, and 
        PensionsYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYYY

_______________________________________________________________________

                                 A BILL


 
       Entitled the ``Pharmaceutical Market Access Act of 2005''.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Pharmaceutical Market Access Act of 
2005''.

SEC. 2. FINDINGS.

    Congress finds as follows:
            (1) Americans unjustly pay up to 1000 percent more to fill 
        their prescriptions than consumers in other countries.
            (2) The United States is the world's largest market for 
        pharmaceuticals yet consumers still pay the world's highest 
        prices.
            (3) An unaffordable drug is neither safe nor effective. 
        Allowing and structuring the importation of prescription drugs 
        ensures access to affordable drugs, thus providing a level of 
        safety to American consumers they do not currently enjoy.
            (4) According to the Congressional Budget Office, American 
        seniors alone will spend $1,800,000,000,000 on pharmaceuticals 
        over the next 10 years.
            (5) Allowing open pharmaceutical markets could save 
        American consumers at least $635,000,000,000 of their own money 
        each year.

SEC. 3. PURPOSES.

    The purposes of this Act are as follows:
            (1) To give all Americans immediate relief from the 
        outrageously high cost of pharmaceuticals.
            (2) To reverse the perverse economics of the American 
        pharmaceutical market.
            (3) To allow the importation of prescription drugs only if 
        the drugs and facilities where such drugs are manufactured are 
        approved by the Food and Drug Administration, and to exclude 
        pharmaceutical narcotics.
            (4) To require that imported prescription drugs be packaged 
        and shipped using counterfeit-resistant technologies.

SEC. 4. AMENDMENTS TO SECTION 804 OF THE FEDERAL FOOD, DRUG, AND 
              COSMETIC ACT.

    (a) Definitions.--Section 804(a) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 384(a)) is amended to read as follows:
    ``(a) Definitions.--In this section:
            ``(1) Importer.--The term `importer' means a pharmacy, 
        group of pharmacies, pharmacist, or wholesaler.
            ``(2) Permitted country.--The term `permitted country' 
        means a country, union, or economic area that is listed in 
        subparagraph (A) of section 802(b)(1), except that the 
        Secretary--
                    ``(A) may add a country, union, or economic area to 
                such list for purposes of this section if the Secretary 
                determines that the country, union, or economic area 
                has a pharmaceutical infrastructure that is 
                substantially equivalent or superior to the 
                pharmaceutical infrastructure of the United States, 
                taking into consideration pharmacist qualifications, 
                pharmacy storage procedures, the drug distribution 
                system, the drug dispensing system, and market 
                regulation; and
                    ``(B) may remove a country, union, or economic area 
                from such list for purposes of this section if the 
                Secretary determines that the country, union, or 
                economic area does not have such a pharmaceutical 
                infrastructure.
            ``(3) Pharmacist.--The term `pharmacist' means a person 
        licensed by a State to practice pharmacy, including the 
        dispensing and selling of prescription drugs.
            ``(4) Pharmacy.--The term `pharmacy' means a person that is 
        licensed by a State to engage in the business of selling 
        prescription drugs at retail that employs 1 or more 
        pharmacists.
            ``(5) Prescription drug.--The term `prescription drug' 
        means a drug subject to section 503(b), other than--
                    ``(A) a controlled substance (as defined in section 
                102 of the Controlled Substances Act (21 U.S.C. 802));
                    ``(B) a biological product (as defined in section 
                351 of the Public Health Service Act (42 U.S.C. 262));
                    ``(C) an infused drug (including a peritoneal 
                dialysis solution);
                    ``(D) an intravenously injected drug;
                    ``(E) a drug that is inhaled during surgery; or
                    ``(F) a drug which is a parenteral drug, the 
                importation of which pursuant to subsection (b) is 
                determined by the Secretary to pose a threat to the 
                public health, in which case section 801(d)(1) shall 
                continue to apply.
            ``(6) Qualifying drug.--The term `qualifying drug' means a 
        prescription drug that--
                    ``(A) is approved under section 505(b)(1); and
                    ``(B) is not--
                            ``(i) a drug manufactured through 1 or more 
                        biotechnology processes;
                            ``(ii) a drug that is required to be 
                        refrigerated; or
                            ``(iii) a photoreactive drug.
            ``(7) Qualifying internet pharmacy.--The term `qualifying 
        Internet pharmacy' means a registered exporter that dispenses 
        qualifying drugs to individuals over an Internet website.
            ``(8) Qualifying laboratory.--The term `qualifying 
        laboratory' means a laboratory in the United States that has 
        been approved by the Secretary for the purposes of this 
        section.
            ``(9) Registered exporter.--The term `registered exporter' 
        means a person that is in the business of exporting a drug to 
        individuals in the United States (or that seeks to be in such 
        business), for which a registration under this section has been 
        approved and is in effect.
            ``(10) Wholesaler.--
                    ``(A) In general.--The term `wholesaler' means a 
                person licensed as a wholesaler or distributor of 
                prescription drugs in the United States under section 
                503(e)(2)(A).
                    ``(B) Exclusion.--The term `wholesaler' does not 
                include a person authorized to import drugs under 
                section 801(d)(1).''.
    (b) Regulations.--Section 804(b) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 384(b)) is amended to read as follows:
    ``(b) Regulations.--Not later than 180 days after the date of 
enactment of the Pharmaceutical Market Access Act of 2005, the 
Secretary, after consultation with the United States Trade 
Representative and the Commissioner of Customs, shall promulgate 
regulations permitting pharmacists, pharmacies, wholesalers, and 
individuals to import qualifying drugs from permitted countries into 
the United States.''.
    (c) Limitation.--Section 804(c) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 384(c)) is amended by striking ``prescription 
drug'' each place it appears and inserting ``qualifying drug''.
    (d) Information and Records.--Section 804(d)(1) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 384(d)(1)) is amended--
            (1) by striking subparagraph (G) and redesignating 
        subparagraphs (H) through (N) as subparagraphs (G) through (M), 
        respectively;
            (2) in subparagraph (H) (as so redesignated), by striking 
        ``telephone number, and professional license number (if any)'' 
        and inserting ``and telephone number''; and
            (3) in subparagraph (L) (as so redesignated), by striking 
        ``(J) and (L)'' and inserting ``(I) and (K)''.
    (e) Testing.--Section 804(e) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 384(e)) is amended to read as follows:
    ``(e) Testing.--The regulations under subsection (b) shall require 
that the testing described under subparagraphs (I) and (K) of 
subsection (d)(1) be conducted by the importer of the qualifying drug, 
unless the qualifying drug is drug subject to the requirements under 
subsection (l) for counterfeit-resistant technologies.''.
    (f) Registration of Exporters; Inspections.--Section 804(f) of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 384(f)) is amended to 
read as follows:
    ``(f) Registration of Exporters; Inspections.--
            ``(1) In general.--Any person that seeks to be a registered 
        exporter (referred to in this subsection as the `registrant') 
        shall submit to the Secretary a registration that includes the 
        following:
                    ``(A) The name of the registrant and identification 
                of all places of business of the registrant that relate 
                to qualifying drugs, including each warehouse or other 
                facility owned or controlled by, or operated for, the 
                registrant;
                    ``(B) An agreement by the registrant to--
                            ``(i) make its places of business that 
                        relate to qualifying drugs (including 
                        warehouses and other facilities owned or 
                        controlled by, or operated for, the exporter) 
                        and records available to the Secretary for on-
                        site inspections, without prior notice, for the 
                        purpose of determining whether the registrant 
                        is in compliance with this Act's requirements;
                            ``(ii) export only qualifying drugs;
                            ``(iii) export only to persons authorized 
                        to import the drugs;
                            ``(iv) notify the Secretary of a recall or 
                        withdrawal of a qualifying drug distributed in 
                        a permitted country to or from which the 
                        registrant has exported or imported, or intends 
                        to export or import, to the United States;
                            ``(v) monitor compliance with registration 
                        conditions and report any noncompliance 
                        promptly;
                            ``(vi) submit a compliance plan showing how 
                        the registrant will correct violations, if any; 
                        and
                            ``(vii) promptly notify Secretary of 
                        changes in the registration information of the 
                        registrant.
            ``(2) Notice of approval or disapproval.--
                    ``(A) In general.--Not later than 90 days after 
                receiving a completed registration from a registrant, 
                the Secretary shall--
                            ``(i) notify such registrant of receipt of 
                        the registration;
                            ``(ii) assign such registrant a 
                        registration number; and
                            ``(ii) approve or disapprove the 
                        application.
                    ``(B) Disapproval of application.--
                            ``(i) In general.--The Secretary shall 
                        disapprove a registration, and notify the 
                        registrant of such disapproval, if the 
                        Secretary has reason to believe that such 
                        registrant is not in compliance with a 
                        registration condition.
                            ``(ii) Subsequent approval.--The Secretary 
                        may subsequently approve a registration that 
                        was denied under clause (i) if the Secretary 
                        finds that the registrant is in compliance with 
                        all registration conditions.
            ``(3) List.--The Secretary shall--
                    ``(A) maintain an up-to-date list of registered 
                exporters (including qualifying Internet pharmacies 
                that sell qualifying drugs to individuals);
                    ``(B) make such list available to the public on the 
                Internet site of the Food and Drug Administration and 
                via a toll-free telephone number; and
                    ``(C) update such list promptly after the approval 
                of a registration under this subsection.
            ``(4) Education of consumers.--The Secretary shall carry 
        out activities, by use of the Internet website and toll-free 
        telephone number under paragraph (3), that educate consumers 
        with regard to the availability of qualifying drugs for import 
        for personal use under this section, including information on 
        how to verify whether an exporter is registered.
            ``(5) Inspection of importers and registered exporters.--
        The Secretary shall inspect the warehouses, other facilities, 
        and records of importers and registered exporters as often as 
        the Secretary determines necessary to ensure that such 
        importers and registered exporters are in compliance with this 
        section.''.
    (g) Suspension of Importation.--Section 804(g) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 384(g)) is amended by--
            (1) striking ``and the Secretary determines that the public 
        is adequately protected from counterfeit and violative 
        prescription drugs being imported under subsection (b)''; and
            (2) by adding after the period at the end the following: 
        ``The Secretary shall reinstate the importation by a specific 
        importer upon a determination by the Secretary that the 
        violation has been corrected and that the importer has 
        demonstrated that further violations will not occur. This 
        subsection shall not apply to a prescription drug imported by 
        an individual, or to a prescription drug shipped to an 
        individual by a qualifying Internet pharmacy.''.
    (h) Waiver Authority for Individuals.--Section 804(j) of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 384(j)) is amended to 
read as follows:
    ``(j) Importation by Individuals.--
            ``(1) In general.--Not later than 180 days after the 
        enactment of the Pharmaceutical Market Access Act of 2005, the 
        Secretary shall by regulation permit an individual to import a 
        drug from a permitted country to the United States if the drug 
        is--
                    ``(A) a qualifying drug;
                    ``(B) imported from a licensed pharmacy or 
                qualifying Internet pharmacy;
                    ``(C) for personal use by an individual, or family 
                member of the individual, not for resale;
                    ``(D) in a quantity that does not exceed a 90-day 
                supply during any 90-day period; and
                    ``(E) accompanied by a copy of a prescription for 
                the drug, which--
                            ``(i) is valid under applicable Federal and 
                        State laws and;
                            ``(ii) was issued by a practitioner who is 
                        authorized to administer prescription drugs.
            ``(2) Drugs dispensed outside the united states.--An 
        individual may import a drug from a country that is not a 
        permitted country if--
                    ``(A) the drug was dispensed to the individual 
                while the individual was in such country, and the drug 
                was dispensed in accordance with the laws and 
                regulations of such country;
                    ``(B) the individual is entering the United States 
                and the drug accompanies the individual at the time of 
                entry;
                    ``(C) the drug is approved for commercial 
                distribution in the country in which the drug was 
                obtained;
                    ``(D) the drug does not appear to be adulterated; 
                and
                    ``(E) the quantity of the drug does not exceed a 
                14-day supply.''.
    (i) Repeal of Certain Provisions.--Section 804 of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 384) is amended by striking 
subsections (l) and (m).

SEC. 5. REGISTRATION FEES.

    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 
registration fee program under which a registered exporter under 
section 804 shall be required to pay an annual fee to the Secretary in 
accordance with this subsection.
    ``(b) Collection.--
            ``(1) Collection on initial registration.--A fee under this 
        section shall be payable for the fiscal year in which the 
        registered exporter first submits a registration under section 
        804 (or reregisters under that section if that person has 
        withdrawn its registration and subsequently reregisters) in a 
        amount of $10,000, due on the date the exporter first submits a 
        registration to the Secretary under section 804.
            ``(2) Collection in subsequent years.--After the fee is 
        paid for the first fiscal year, the fee described under this 
        subsection 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 registered exporter for a fiscal year in which 
        the fee is payable.
    ``(c) Fee Amount.--
            ``(1) In general.--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 Pharmaceutical Market Access Act of 2005 in the 
        subsequent fiscal year.
            ``(2) Limitation.--
                    ``(A) In general.--The aggregate total of fees 
                collected under this section shall not exceed 1 percent 
                of the total price of drugs exported annually to the 
                United States by registered exporters under this 
                section.
                    ``(B) Reasonable estimate.--Subject to the 
                limitation described in subparagraph (A), a fee under 
                this subsection for an exporter shall be an amount that 
                is a reasonable estimate by the Secretary of the annual 
                share of the exporter of the volume of drugs exported 
                by exporters under this section.
    ``(d) Use of Fees.--The fees collected under this section shall be 
used for the sole purpose of administering this section with respect to 
registered exporters, including the costs associated with--
            ``(1) inspecting the facilities of registered exporters, 
        and of other entities in the chain of custody of a qualifying 
        drug;
            ``(2) developing, implementing, and maintaining a system to 
        determine registered exporters' compliance with the 
        registration conditions under the Pharmaceutical Market Access 
        Act of 2005, including when shipments of qualifying drugs are 
        offered for import into the United States; and
            ``(3) inspecting such shipments, as necessary, when offered 
        for import into the United States to determine if any such 
        shipment should be refused admission.
    ``(e) Annual Fee Setting.--The Secretary shall establish, 60 days 
before the beginning of each fiscal year beginning after September 30, 
2005, 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 exporter subject to 
        a fee under this section fails to pay the fee, the Secretary 
        shall not permit the registered exporter to engage in 
        exportation to the United States or offering for exportation 
        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 the 
        beginning of each fiscal year, the Secretary shall--
                    ``(A) publish registration 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 registration 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. 6. COUNTERFEIT-RESISTANT TECHNOLOGY.

    (a) Misbranding.--Section 502 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 352; deeming drugs and devices to be 
misbranded) is amended by adding at the end the following:
    ``(v) If it is a drug subject to section 503(b), unless the 
packaging of such drug complies with the requirements of section 505C 
for counterfeit-resistant technologies.''.
    (b) Requirements.--Title V of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 351 et seq.) is amended by inserting after section 505B 
the following:

``SEC. 505C. COUNTERFEIT-RESISTANT TECHNOLOGIES.

    ``(a) Incorporation of Counterfeit-Resistant Technologies Into 
Prescription Drug Packaging.--The Secretary shall require that the 
packaging of any drug subject to section 503(b) incorporate--
            ``(1) overt optically variable counterfeit-resistant 
        technologies that are described in subsection (b) and comply 
        with the standards of subsection (c); or
            ``(2) technologies that have an equivalent function of 
        security, as determined by the Secretary.
    ``(b) Eligible Technologies.--Technologies described in this 
subsection--
            ``(1) shall be visible to the naked eye, providing for 
        visual identification of product authenticity without the need 
        for readers, microscopes, lighting devices, or scanners;
            ``(2) shall be similar to that used by the Bureau of 
        Engraving and Printing to secure United States currency;
            ``(3) shall be manufactured and distributed in a highly 
        secure, tightly controlled environment; and
            ``(4) should incorporate additional layers of non-visible 
        covert security features up to and including forensic 
        capability.
    ``(c) Standards for Packaging.--
            ``(1) Multiple elements.--For the purpose of making it more 
        difficult to counterfeit the packaging of drugs subject to 
        section 503(b), manufacturers of the drugs shall incorporate 
        the technologies described in subsection (b) into multiple 
        elements of the physical packaging of the drugs, including 
        blister packs, shrink wrap, package labels, package seals, 
        bottles, and boxes.
            ``(2) Labeling of shipping container.--Shipments of drugs 
        described in subsection (a) shall include a label on the 
        shipping container that incorporates the technologies described 
        in subsection (b), so that officials inspecting the packages 
        will be able to determine the authenticity of the shipment. 
        Chain of custody procedures shall apply to such labels and 
shall include procedures applicable to contractual agreements for the 
use and distribution of the labels, methods to audit the use of the 
labels, and database access for the relevant governmental agencies for 
audit or verification of the use and distribution of the labels.
    ``(d) Effective Date.--This section shall take effect 180 days 
after the date of enactment of the Pharmaceutical Market Access Act of 
2005.''.

SEC. 7. PROHIBITED ACTS.

    Section 301 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
331) is amended by inserting after subsection (k) the following:
    ``(l) The failure to register in accordance with section 804(f) or 
to import or offer to import a prescription drug in violation of a 
suspension order under section 804(g).''.

SEC. 8. PATENTS.

    Section 271 of title 35, United States Code, is amended--
            (1) by redesignating subsections (h) and (i) as subsections 
        (i) and (j), respectively; and
            (2) by inserting after subsection (g) the following:
    ``(h) It shall not be an act of infringement to use, offer to sell, 
or sell within the United States or to import into the United States 
any patented invention under section 804 (21 U.S.C. 384) of the Federal 
Food, Drug, and Cosmetic Act that was first sold abroad by or under 
authority of the owner or licensee of such patent.''.

SEC. 9. OTHER ENFORCEMENT ACTIONS.

    (a) In General.--Section 804 of the Federal Food, Drug, and 
Cosmetic Act (as amended in section 4) is amended by adding at the end 
the following:
    ``(l) Unfair or Discriminatory Acts and Practices.--
            ``(1) In general.--It is unlawful for a manufacturer, 
        directly or indirectly (including by being a party to a 
        licensing or other agreement) to--
                    ``(A) discriminate by charging a higher price for a 
                prescription drug sold to a person in a permitted 
                country that exports a prescription drug to the United 
                States under this section than the price that is 
                charged to another person that is in the same country 
                and that does not export a prescription drug into the 
                United States under this section;
                    ``(B) discriminate by charging a higher price for a 
                prescription drug sold to a person that distributes, 
                sells, or uses a prescription drug imported into the 
                United States under this section than the price that is 
                charged to another person in the United States that 
                does not import a prescription drug under this section, 
                or that does not distribute, sell, or use such a drug;
                    ``(C) discriminate by denying supplies of a 
                prescription drug to a person in a permitted country 
                that exports a prescription drug to the United States 
                under this section or distributes, sells, or uses a 
                prescription drug imported into the United States under 
                this section;
                    ``(D) discriminate by publicly, privately, or 
                otherwise refusing to do business with a person in a 
                permitted country that exports a prescription drug to 
                the United States under this section or distributes, 
                sells, or uses a prescription drug imported into the 
                United States under this section;
                    ``(E) discriminate by specifically restricting or 
                delaying the supply of a prescription drug to a person 
                in a permitted country that exports a prescription drug 
                to the United States under this section or distributes, 
                sells, or uses a prescription drug imported into the 
                United States under this section;
                    ``(F) cause there to be a difference (including a 
                difference in active ingredient, route of 
                administration, dosage form, strength, formulation, 
                manufacturing establishment, manufacturing process, or 
                person that manufactures the drug) between a 
                prescription drug for distribution in the United States 
                and the drug for distribution in a permitted country 
                for the purpose of restricting importation of the drug 
                into the United States under this section;
                    ``(G) refuse to allow an inspection authorized 
                under this section of an establishment that 
                manufactures a prescription drug that may be imported 
                or offered for import under this section;
                    ``(H) fail to conform to the methods used in, or 
                the facilities used for, the manufacturing, processing, 
                packing, or holding of a prescription drug that may be 
                imported or offered for import under this section to 
                good manufacturing practice under this Act;
                    ``(I) become a party to a licensing or other 
                agreement related to a prescription drug that fails to 
                provide for compliance with all requirements of this 
                section with respect to such prescription drug or that 
                has the effect of prohibiting importation of the drug 
                under this section; or
                    ``(J) engage in any other action that the Federal 
                Trade Commission determines to discriminate against a 
                person that engages in, or to impede, delay, or block 
                the process for, the importation of a prescription drug 
                under this section.
            ``(2) Affirmative defense.--It shall be an affirmative 
        defense to a charge that a person has discriminated under 
        subparagraph (A), (B), (C), (D), or (E) of paragraph (1) that 
        the higher price charged for a prescription drug sold to a 
        person, the denial of supplies of a prescription drug to a 
        person, the refusal to do business with a person, or the 
        specific restriction or delay of supplies to a person is not 
        based, in whole or in part, on--
                    ``(A) the person exporting or importing a 
                prescription drug into the United States under this 
                section; or
                    ``(B) the person distributing, selling, or using a 
                prescription drug imported into the United States under 
                this section.
            ``(3) Presumption and affirmative defense.--
                    ``(A) Presumption.--A difference (including a 
                difference in active ingredient, route of 
                administration, dosage form, strength, formulation, 
                manufacturing establishment, manufacturing process, or 
                person that manufactures the drug) created after 
                January 1, 2005, between a prescription drug for 
                distribution in the United States and the drug for 
                distribution in a permitted country shall be presumed 
                under paragraph (1)(H) to be for the purpose of 
                restricting importation of the drug into the United 
                States under this section.
                    ``(B) Affirmative defense.--It shall be an 
                affirmative defense to the presumption under 
                subparagraph (A) that--
                            ``(i) the difference was required by the 
                        country in which the drug is distributed; or
                            ``(ii) the Secretary has determined that 
                        the difference was necessary to improve the 
                        safety or effectiveness of the drug.
            ``(4) Effect of subsection.--
                    ``(A) Sales in other countries.--This subsection 
                applies only to the sale or distribution of a 
                prescription drug in a country if the manufacturer of 
                the drug chooses to sell or distribute the drug in the 
                country. Nothing in this subsection shall be construed 
                to compel the manufacturer of a drug to distribute or 
                sell the drug in a country.
                    ``(B) Discounts to insurers, health plans, pharmacy 
                benefit managers, and covered entities.--Nothing in 
                this subsection shall be construed to--
                            ``(i) prevent or restrict a manufacturer of 
                        a prescription drug from providing discounts to 
                        an insurer, health plan, pharmacy benefit 
                        manager in the United States, or covered entity 
                        in the drug discount program under section 340B 
                        in return for inclusion of the drug on a 
                        formulary;
                            ``(ii) require that such discounts be made 
                        available to other purchasers of the 
                        prescription drug; or
                            ``(iii) prevent or restrict any other 
                        measures taken by an insurer, health plan, or 
                        pharmacy benefit manager to encourage 
                        consumption of such prescription drug.
                    ``(C) Charitable contributions.--Nothing in this 
                subsection shall be construed to--
                            ``(i) prevent a manufacturer from donating 
                        a prescription drug, or supplying a 
                        prescription drug at nominal cost, to a 
                        charitable or humanitarian organization, 
                        including the United Nations and affiliates, or 
                        to a government of a foreign country; or
                            ``(ii) apply to such donations or supplying 
                        of a prescription drug.
            ``(5) Enforcement.--
                    ``(A) Unfair or deceptive act or practice.--A 
                violation of this subsection shall be treated as a 
                violation of a rule defining an unfair or deceptive act 
                or practice prescribed under section 18(a)(1)(B) of the 
                Federal Trade Commission Act.
                    ``(B) Actions by the commission.--The Federal Trade 
                Commission--
                            ``(i) shall enforce this subsection in the 
                        same manner, by the same means, and with the 
                        same jurisdiction, powers, and duties as though 
                        all applicable terms and provisions of the 
                        Federal Trade Commission Act were incorporated 
                        into and made a part of this section; and
                            ``(ii) may seek monetary relief threefold 
                        the damages sustained.
            ``(6) Actions by states.--
                    ``(A) In general.--
                            ``(i) Civil actions.--The attorney general 
                        of a State may bring a civil action on behalf 
                        of the residents of the State, and persons 
                        doing business in the State, in a district 
                        court of the United States of appropriate 
                        jurisdiction for a violation of paragraph (1) 
                        to--
                                    ``(I) enjoin that practice;
                                    ``(II) enforce compliance with this 
                                subsection;
                                    ``(III) obtain damages, 
                                restitution, or other compensation on 
                                behalf of residents of the State and 
                                persons doing business in the State, 
                                including threefold the damages; or
                                    ``(IV) obtain such other relief as 
                                the court may consider to be 
                                appropriate.
                            ``(ii) Notice.--
                                    ``(I) In general.--Before filing an 
                                action under clause (i), the attorney 
                                general of the State involved shall 
                                provide to the Federal Trade 
                                Commission--
                                            ``(aa) written notice of 
                                        that action; and
                                            ``(bb) a copy of the 
                                        complaint for that action.
                                    ``(II) Exemption.--Subclause (I) 
                                shall not apply with respect to the 
                                filing of an action by an attorney 
                                general of a State under this 
                                paragraph, if the attorney general 
                                determines that it is not feasible to 
                                provide the notice described in that 
                                subclause before filing of the action. 
                                In such case, the attorney general of a 
                                State shall provide notice and a copy 
                                of the complaint to the Federal Trade 
                                Commission at the same time as the 
                                attorney general files the action.
                    ``(B) Intervention.--
                            ``(i) In general.--On receiving notice 
                        under subparagraph (A)(ii), the Commission 
                        shall have the right to intervene in the action 
                        that is the subject of the notice.
                            ``(ii) Effect of intervention.--If the 
                        Commission intervenes in an action under 
                        subparagraph (A), it shall have the right--
                                    ``(I) to be heard with respect to 
                                any matter that arises in that action; 
                                and
                                    ``(II) to file a petition for 
                                appeal.
                    ``(C) Construction.--For purposes of bringing any 
                civil action under subparagraph (A), nothing in this 
                subsection shall be construed to prevent an attorney 
                general of a State from exercising the powers conferred 
                on the attorney general by the laws of that State to--
                            ``(i) conduct investigations;
                            ``(ii) administer oaths or affirmations; or
                            ``(iii) compel the attendance of witnesses 
                        or the production of documentary and other 
                        evidence.
                    ``(D) Actions by the commission.--
                            ``(i) In general.--In any case in which an 
                        action is instituted by or on behalf of the 
                        Commission for a violation of paragraph (1), a 
                        State may not, during the pendency of that 
                        action, institute an action under subparagraph 
                        (A) for the same violation against any 
                        defendant named in the complaint in that 
                        action.
                            ``(ii) Intervention.--An attorney general 
                        of a State may intervene, on behalf of the 
                        residents of that State, in an action 
                        instituted by the Commission.
                            ``(iii) Effect of intervention.--If an 
                        attorney general of a State intervenes in an 
                        action instituted by the Commission, such 
                        attorney general shall have the right--
                                    ``(I) to be heard with respect to 
                                any matter that arises in that action; 
                                and
                                    ``(II) to file a petition for 
                                appeal.
                    ``(E) Venue.--Any action brought under subparagraph 
                (A) may be brought in the district court of the United 
                States that meets applicable requirements relating to 
                venue under section 1391 of title 28, United States 
                Code.
                    ``(F) Service of process.--In an action brought 
                under subparagraph (A), process may be served in any 
                district in which the defendant--
                            ``(i) is an inhabitant; or
                            ``(ii) may be found.
                    ``(G) Limitation of actions.--Any action under this 
                paragraph to enforce a cause of action under this 
                subsection by the Federal Trade Commission or the 
                attorney general of a State shall be forever barred 
                unless commenced within 5 years after the Federal Trade 
                Commission, or the attorney general, as the case may 
                be, knew or should have known that the cause of action 
                accrued. No cause of action barred under existing law 
on the effective date of this Act shall be revived by this Act.
                    ``(H) Measurement of damages.--In any action under 
                this paragraph to enforce a cause of action under this 
                subsection in which there has been a determination that 
                a defendant has violated a provision of this 
                subsection, damages may be proved and assessed in the 
                aggregate by statistical or sampling methods, by the 
                computation of illegal overcharges or by such other 
                reasonable system of estimating aggregate damages as 
                the court in its discretion may permit without the 
                necessity of separately proving the individual claim 
                of, or amount of damage to, persons on whose behalf the 
                suit was brought.
                    ``(I) Exclusion on duplicative relief.--The 
                district court shall exclude from the amount of 
                monetary relief awarded in an action under this 
                paragraph brought by the attorney general of a State 
                any amount of monetary relief which duplicates amounts 
                which have been awarded for the same injury.
            ``(7) Effect on antitrust laws.--Nothing in this subsection 
        shall be construed to modify, impair, or supersede the 
        operation of the antitrust laws. For the purpose of this 
        subsection, the term `antitrust laws' has the meaning given it 
        in the first section of the Clayton Act, except that it 
        includes section 5 of the Federal Trade Commission Act to the 
        extent that such section 5 applies to unfair methods of 
        competition.
            ``(8) Manufacturer.--In this subsection, the term 
        `manufacturer' means any entity, including any affiliate or 
        licensee of that entity, that is engaged in--
                    ``(A) the production, preparation, propagation, 
                compounding, conversion, or processing of a 
                prescription drug, either directly or indirectly by 
                extraction from substances of natural origin, or 
                independently by means of chemical synthesis, or by a 
                combination of extraction and chemical synthesis; or
                    ``(B) the packaging, repackaging, labeling, 
                relabeling, or distribution of a prescription drug.''.
    (b) Regulations.--The Federal Trade Commission shall promulgate 
regulations to carry out the enforcement program under section 804(l) 
of the Federal Food, Drug, and Cosmetic Act (as added by subsection 
(a)).
    (c) Suspension and Termination of Exporters.--Section 804(g) of the 
Federal Food, Drug, and Cosmetic Act (as amended by section 4(g)) (21 
U.S.C. 384(g)) is amended by--
            (1) striking ``Suspension of Importation.--The Secretary'' 
        and inserting ``Suspension of Importation.--
            ``(1) The Secretary--''; and
             (2) adding at the end the following:
            ``(2) Suspension and termination of exporters.--
                    ``(A) Suspension.--With respect to the 
                effectiveness of a registration submitted under 
                subsection (f) by a registered exporter:
                            ``(i) Subject to clause (ii), if the 
                        Secretary determines, after notice and 
                        opportunity for a hearing, that the registered 
                        exporter has failed to maintain substantial 
                        compliance with all registration conditions, 
                        the Secretary may suspend the registration.
                            ``(ii) If the Secretary determines that, 
                        under color of the registration, the registered 
                        exporter has exported a drug that is not a 
                        qualifying drug, or a drug that does not meet 
                        the criteria under this section, or has 
                        exported a qualifying drug to an individual in 
                        violation of this section, the Secretary shall 
                        immediately suspend the registration. A 
                        suspension under the preceding sentence is not 
                        subject to the provision by the Secretary of 
                        prior notice, and the Secretary shall provide 
                        to the registered exporter involved an 
                        opportunity for a hearing not later than 10 
                        days after the date on which the registration 
                        is suspended.
                            ``(iii) The Secretary may reinstate the 
                        registration, whether suspended under clause 
                        (i) or (ii), if the Secretary determines that 
                        the registered exporter has demonstrated that 
                        further violations of registration conditions 
                        will not occur.
                    ``(B) Termination.--The Secretary, after notice and 
                opportunity for a hearing, may terminate the 
                registration under subsection (f) of a registered 
                exporter if the Secretary determines that the 
                registered exporter has engaged in a pattern or 
                practice of violating 1 or more registration 
                conditions, or if on 1 or more occasions the Secretary 
                has under subparagraph (A)(ii) suspended the 
                registration of the registered exporter. The Secretary 
                may make the termination permanent, or for a fixed 
                period of not less than 1 year. During the period in 
                which the registration of a registered exporter is 
                terminated, any registration submitted under subsection 
                (f) by such exporter or a person who is a partner in 
                the export enterprise or a principal officer in such 
                enterprise, and any registration prepared with the 
                assistance of such exporter or such a person, has no 
                legal effect under this section.''.

SEC. 10. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated such sums as may be 
necessary to carry out this Act (and the amendments made by this Act).
                                 <all>