II 109th CONGRESS 1st Session S. 1527 IN THE SENATE OF THE UNITED STATES July 28, 2005 Mr. Kennedy (for himself and Mr. Reed) introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions A BILL To amend the Public Health Service Act with respect to immunizations against vaccine-preventable diseases, including influenza, and for other purposes.

1.

Short title

This Act may be cited as the Vaccine Access and Supply Act.

2.

Certain authorities regarding influenza and other vaccines

(a)

In general

Part B of title III of the Public Health Service Act (42 U.S.C. 243 et seq.) is amended— (1)by redesignating section 317A as section 317A–1; and (2)by inserting after section 317 the following section:

317A.

Certain authorities regarding influenza and other vaccines

(a)

Purchase of unsold doses of periodic-Change vaccines

(1)

Producer-specific negotiation on supply for season

In the case of influenza vaccine and each other periodic-change vaccine, the Secretary shall, for each applicable vaccine season, negotiate with each producer of the vaccine to reach an agreement on the number of doses of the vaccine that the producer will manufacture for such season. The Secretary is not required under the preceding sentence to enter into such an agreement with any producer. (2)

Purchase of percentage of unsold doses

With respect to the number of doses of a periodic-change vaccine manufactured for an applicable vaccine season by a producer in accordance with an agreement under paragraph (1), the Secretary shall purchase from the producer 50 percent of such doses that are unsold for the season. (3)

Price per dose

(A)

Average sales price

Subject to subparagraph (B), the price per dose paid by the Secretary in a purchase of periodic-change vaccine under paragraph (2) shall be the average sales price for the vaccine for the applicable vaccine season, as determined by the Secretary. (B)

Audits; adjustments

The Secretary may enter into an agreement under paragraph (1) with a producer regarding a periodic-change vaccine only if the agreement includes a provision that permits the Secretary to conduct audits of sales of such vaccine at wholesale by the producer. The average sales price determined under subparagraph (A) for a dose of the vaccine for an applicable vaccine season shall be adjusted by the Secretary as determined necessary by the Secretary on the basis of such audits and on the basis of any other information available to the Secretary on sales of the vaccine at wholesale. (4)

Definitions

For purposes of this section: (A)The term periodic-change vaccine means a federally recommended vaccine (as defined in subsection (g)) that is designed only for a single applicable vaccine season due to characteristics of the etiologic agent or agents for the disease involved, or due to characteristics of the vaccine, that adversely affect the extent to which the vaccine is safe and effective after such season. Such term includes influenza vaccine. (B)The term producer means a person who— (i)manufactures an approved vaccine (as defined in subsection (g)); or (ii)who intends to manufacture such a vaccine and is determined by the Secretary to have the capacity to meet legal requirements applicable to such manufacturing. (C)(i)The term vaccine season, with respect to a periodic-change vaccine, means a consecutive number of months, not exceeding 24 months, during which the Secretary recommends that the public in general, or particular populations, as the case may be, receive immunizations against the disease involved. (ii)The term applicable vaccine season, with respect to a periodic-change vaccine, means the vaccine season that is applicable to such vaccine. (5)

Direct spending

The requirement under paragraph (2) that the Secretary make purchases of doses of periodic-change vaccine constitutes budget authority in advance of appropriations Acts, and represents the obligation of the United States to make outlays for such purchases in accordance with this subsection. (b)

Immunization program for eligible adults

(1)

In general

The Secretary shall by regulation establish a program for the distribution of qualified adult vaccines through States with approved applications under paragraph (4)(C), under which program— (A)each vaccine-eligible adult, in receiving an immunization with a qualified adult vaccine from a program-registered provider on or after October 1, 2006, is entitled to receive the immunization without charge for the cost of such vaccine; and (B)(i)each program-registered provider who administers such a vaccine to a vaccine-eligible adult on or after such date is entitled to receive such vaccine under the program without charge either for the vaccine or its delivery to the provider; and (ii)no vaccine is distributed under the program to a provider unless the provider is a program-registered provider. (2)

Relationship to program for distribution of pediatric vaccines

The provisions of the program under section 1928 of the Social Security Act (including provisions taking effect on or after the effective date of this section) apply with respect to immunizations for vaccine-eligible adults under the program under paragraph (1) to the same extent and in the same manner as such provisions apply with respect to immunizations for vaccine-eligible children under the program under such section 1928, except to the extent that such a provision conflicts with this subsection. The preceding section may not be construed as having any effect on the program under title XIX of the Social Security Act, or as having the effect that, in the program under paragraph (1), State plans comparable to State plans under section 1902 of such Act are required. (3)

Vaccine-eligible adult

(A)

In general

For purposes of this subsection, the term vaccine-eligible adult means a federally vaccine-eligible adult or a State vaccine-eligible adult. (B)

Federally vaccine-eligible adult

For purposes of this subsection, the term federally vaccine-eligible adult means each of the following: (i)An adult who is not insured. (ii)An adult who— (I)is administered a qualified adult vaccine by a federally-qualified health center (as defined in section 1905(l)(2)(B)) of the Social Security Act), by any other entity that is a covered entity under section 340B(a)(4), or by any public clinic; and (II)is not insured with respect to the vaccine. (iii)An adult who— (I)is administered a qualified adult vaccine while incarcerated in a Federal, State, or local penal or correctional institution, including an adult who is held pending judicial or administrative proceedings; and (II)is not insured with respect to the vaccine. (C)

State vaccine-eligible adult

For purposes of this subsection, the term State vaccine-eligible adult means, with respect to a State and a qualified adult vaccine, an adult who is within a class of adults for which the State is purchasing the vaccine pursuant to provisions that apply pursuant to paragraph (2). (4)

Participation of states

(A)

In general

In the case or each State with an approved application under subparagraph (C), the Secretary shall provide, in accordance with provisions that apply pursuant to paragraph (2), for the purchase and delivery on behalf of the State, without charge to the State, of such quantities of qualified adult vaccines as may be necessary for the administration of such vaccines to all vaccine-eligible adults in the State on or after October 1, 2006. (B)

Program criteria

The Secretary, in accordance with provisions that apply pursuant to paragraph (2), shall establish criteria for State programs under paragraph (1). (C)

State application

A State may participate in the program under paragraph (1) only if the State submits to the Secretary an application for such participation. The Secretary shall approve any such application that— (i)is submitted in such form and such manner as the Secretary may require; and (ii)demonstrates that the State is in compliance with criteria under subparagraph (B). (5)

Additional definitions

For purposes of this subsection: (A)The term adult means an individual who is not a child as defined in section 1928 of the Social Security Act. (B)The term adult vaccine means a federally recommended vaccine for adults. (C)(i)The term insured, with respect to an adult, means that the adult is enrolled under, and entitled to benefits under, a health insurance policy or plan, including a group health plan, a prepaid health plan, or an employee welfare benefit plan under the Employee Retirement Income Security Act of 1974. (ii)An adult is not insured with respect to a qualified adult vaccine if the adult is entitled to benefits under such a health insurance policy or plan, but such benefits are not available with respect to the cost of such vaccine. (D)The term qualified adult vaccine means an adult vaccine with respect to which a contract is in effect pursuant to provisions that apply pursuant to paragraph (2). (6)

Direct spending

The requirement under paragraph (1) that the Secretary carry out a program constitutes budget authority in advance of appropriations Acts, and represents the obligation of the Federal Government to make outlays to provide for immunizations of vaccine-eligible adults in accordance with this subsection, including with respect to program-registered providers and with respect to the purchase and delivery of qualified adult vaccines on behalf of States. (c)

Information on location of supplies of vaccines; emergency authority of secretary

(1)

In general

If the Secretary publishes in the Federal Register a declaration that there is a shortage of an approved vaccine that constitutes a public health emergency, each person who is a manufacturer or distributor of the vaccine shall provide to the Secretary such information as the Secretary may require with respect to the location of supplies of the vaccine, including supplies in the possession of the person, supplies scheduled to be received by the person, and supplies sold by the person. Any such person who fails to comply with an order of the Secretary under the preceding sentence is liable to the United States for a civil penalty not exceeding $1,000 for each day for which the person is in violation of the order. (2)

Availability to states

Upon the request of a State, the Secretary shall provide to the State the information collected by the Secretary under paragraph (1) that relates to the State. (d)

Emergency response plan regarding shortages

The Secretary shall develop and maintain a plan for the response of the Secretary to potential shortages in supplies of vaccines that would constitute public health emergencies. The plan shall include provisions with respect to communication among the relevant entities; distribution of available supplies of the vaccine involved; the designation of populations to be given priority for immunizations; interactions with State and local governments; use of the vaccine stockpile; and special considerations for specific vaccines. The initial plan shall be completed not later than 12 months after the date of the enactment of the Vaccine Access and Supply Act. (e)

Research

For the purpose of carrying out research toward the development of new vaccines for human use, including vaccines to prevent or control pandemic infections, there are authorized to be appropriated $250,000,000 for fiscal year 2006, and such sums as may be necessary for each of the fiscal years 2007 through 2010. Such authorization is in addition to any other authorizations of appropriations for such purpose. (f)

Education program regarding adult immunizations

(1)

In general

The Secretary shall develop and implement a program to promote, among the adult population, immunizations with federally recommended vaccines. (2)

Content of program

The program developed under paragraph (1) shall include the use of a mass media campaign. (3)

Authorization of appropriations

For the purpose of carrying out this subsection, there are authorized to be appropriated such sums as may be necessary for each of the fiscal years 2006 through 2010. (g)

General definitions

For purposes of this section: (1)The term approved vaccine means a vaccine for which a biologics license under section 351 is in effect. (2)(A)The term federally recommended vaccine, with respect to an adult, means an approved vaccine recommended by the Advisory Committee on Immunization Practices (an advisory committee established by the Secretary, acting through the Director of the Centers for Disease Control and Prevention). (B)The term federally recommended vaccine, with respect to a child, means a vaccine on the list referred to in section 1928(e) of the Social Security Act.

. (b)

Immunizations for eligible adults; continued coverage under group health plans

With respect to the program under section 317A(b) of the Public Health Service Act (as added by subsection (a) of this section) (referred to in this subsection as the adult program): (1)Pursuant to paragraph (2) of such section, the provisions of section 1928 of the Social Security Act (referred to in this section as the pediatric program) that apply with respect to the adult program include subsection (f) of the pediatric program (relating to State maintenance of immunization laws). (2)Section 609(d) of the Employee Retirement Income Security Act, and the effective date for such section (under section 4301(d) of Public Law 103–66), apply with respect to the adult program to the same extent and in the same manner as such section and effective date apply with respect to the pediatric program. For purposes of such section 609(d) as applied pursuant to the preceding sentence, the reference in such section to May 1, 1993, shall be considered a reference to July 1, 2005. (3)Section 4980B(f)(1) of the Internal Revenue Code of 1986 (as added by section 13422(a) of Public Law 103–66) applies with respect to adult vaccines (as defined in the adult program) to the same extent and in the same manner as such section applies with respect to pediatric vaccines. For purposes of such section 4980B(f)(1) as applied pursuant to the preceding sentence, the reference in such section to May 1, 1993, shall be considered a reference to July 1, 2005. This paragraph applies with respect to plan years beginning after the date of the enactment of this Act. (4)Section 13631(d) of Public Law 103–66 (relating to title XXII of the Public Health Service Act) applies with respect to the adult program to the same extent and in the same manner as such section applies with respect to the pediatric program. For purposes of such section 13631(d) as applied pursuant to the preceding sentence, the reference in such section to May 1, 1993, shall be considered a reference to July 1, 2005.

3.

Program for distribution of pediatric vaccines

(a)

Inclusion of all public clinics

Section 1928(b)(2)(A)(iii)(I) of the Social Security Act (42 U.S.C. 1396s(b)(2)(A)(iii)(I)) is amended— (1)by striking or a rural health clinic and inserting , a rural health clinic; and (2)by inserting or a public clinic, after 1905(l)(1)),. (b)

Authority to remove certain limitations on payments to manufacturers

Section 1928(d)(3)(B) of the Social Security Act (42 U.S.C. 1396s(d)(3)(B)) is amended by adding at the end the following: In the case of a contract entered into on or after the date of the enactment of the Vaccine Access and Supply Act, the limitation established in the preceding sentence with respect to the price per dose of a pediatric vaccine does not apply if the Secretary determines that the limitation is having a significant adverse effect on the availability of sufficient supplies of the vaccine.. (c)

Sales from 6-Month supply

Section 1928(d)(6) of the Social Security Act (42 U.S.C. 1396s(d)(6)) is amended by inserting before the last sentence the following: The Secretary may sell such quantities of vaccines from such supply as the Secretary determines appropriate. Proceeds received from such sales shall be available to the Secretary only for the purposes of procuring pediatric vaccine stockpiles under this section and shall remain available until expended..

4.

Amendments to program of vaccine-related grants to States

Section 317(j) of the Public Health Service Act (42 U.S.C. 247b(j)) is amended by adding at the end the following paragraph: (3)(A)(i)For fiscal year 2006, the Secretary shall make grants described in paragraphs (1) and (2) (relating to immunizing individuals without charge) in an aggregate amount not exceeding $515,536,000. (ii)Of the amount available under subparagraph (A) for fiscal year 2006, the Secretary shall reserve not less than $80,000,000 for the purpose of providing immunizations for adults who have not, prior to fiscal year 2006, been served by immunization programs carried out with grants made pursuant to paragraph (1) or (2). (B)(i)For fiscal year 2007 and each subsequent fiscal year, the Secretary shall make grants described in paragraphs (1) and (2) in an aggregate amount equal to the sum of the amounts determined under subclauses (I) and (II), as follows: (I)Of the aggregate amount provided in such grants for fiscal year 2006, the Secretary shall determine the portion that was obligated to purchase vaccines. The amount determined under this subclause is such portion as increased to offset the percentage increase in the average sales price for such vaccines for the most recent five-year period for which data are available, taking into account reports under subparagraph (F) (in the case of fiscal year 2007 and subsequent fiscal years). (II)Of the aggregate amount provided in such grants for fiscal year 2006, the Secretary shall determine the portion that was obligated for purposes other than the purchase of vaccines. The amount determined under this subclause is such portion as increased to offset the percentage increase in the Consumer Price Index for all urban consumers (all items; United States city average) for the most recent five-year period for which data are available. (ii)Of the amount available under clause (i) for a fiscal year, the Secretary shall, for the purpose described in subparagraph (A)(ii), reserve not less than the amount specified in such subparagraph as increased in accordance with the same methodology as applies under clause (i). (C)Subject to subparagraphs (D) through (F)), grants made pursuant to this paragraph shall be made in accordance with criteria of the Secretary issued under paragraphs (1) and (2) for immunization programs. The preceding sentence may not be construed as terminating the authority of the Secretary to modify such criteria. (D)The purposes for which grants made pursuant to this paragraph may be expended by a State or political subdivision include the following: (i)Conducting assessments to determine the number of adults in the area involved who need immunizations and the barriers to providing immunizations to such adults. (ii)Developing and implementing strategies to increase the rate of immunizations in populations in which a significant number of individuals have not received immunizations with the federally recommended vaccines (as defined in section 317A(g)) for the populations. (iii)Educating care givers, health care professionals, and the public about the need to be immunized. (iv)Consulting with health care providers with respect to ensuring proper and timely immunizations for their patients. (v)Investigating and responding to outbreaks of vaccine-preventable diseases. (vi)Developing and modifying plans to respond to potential shortages in supplies of vaccines. (vii)Preparing reports under subparagraph (F) and any additional reports that are submitted to the Secretary pursuant to this paragraph. (E)A condition for the receipt by a State of a grant made pursuant to this paragraph for a fiscal year is that the State have (or agree to develop, in the case of a grant for fiscal year 2006) a State plan that— (i)ensures the distribution and administration of vaccines in the event that the Secretary declares a shortage of approved vaccines as a public health emergency; and (ii)includes plans for communication and coordination between— (I)State and local public health departments; (II)community health centers; (III)hospitals; (IV)private physicians licensed within the State; and (V)to the extent practicable, vaccine manufacturers and suppliers. (F)A condition for the receipt of a grant made pursuant to this paragraph for a fiscal year is that the applicant involved agree to submit to the Secretary a report that specifies for such year the quantity of each type of vaccine purchased with the grant and the per-dose cost of the vaccine. (G)The requirements under subparagraphs (A) and (B) that the Secretary make grants constitutes budget authority in advance of appropriations Acts, and represents the obligation of the Federal Government to make outlays to provide for immunizations without charge pursuant to the grants in accordance with this paragraph. .

5.

One-year notice on discontinuing manufacture of vaccine

Subchapter A of chapter V of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 351 et seq.) is amended by inserting after section 506C the following section:

506D.

Discontinuance of vaccine

(a)

In general

(1)

Notice to secretary

A manufacturer of a vaccine approved by the Secretary shall notify the Secretary of a discontinuance of the manufacture of the vaccine at least 12 months prior to the date of the discontinuance. (2)

Director of centers for disease control and prevention

Promptly after receiving a notice under paragraph (1), the Secretary shall inform the Director of the Centers for Disease Control and Prevention of the notice. Promptly after determining that a reduction under subsection (b) applies with respect to such a notice, the Secretary shall inform such Director of the reduction. (3)

Relationship to separate notice program

In the case of a vaccine that is approved by the Secretary and is a drug described in section 506C(a), this section applies to the vaccine in lieu of section 506C. (b)

Reduction in notification period

The notification period required under subsection (a) for a manufacturer may be reduced if the manufacturer certifies to the Secretary that good cause exists for the reduction, such as a situation in which— (1)a public health problem may result from continuation of the manufacturing for the 12-month period; (2)a biomaterials shortage prevents the continuation of the manufacturing for the 12-month period; (3)a liability problem may exist for the manufacturer if the manufacturing is continued for the 12-month period; (4)continuation of the manufacturing for the 12-month period may cause substantial economic hardship for the manufacturer; (5)the manufacturer has filed for bankruptcy under chapter 7 or 11 of title 11, United States Code; or (6)the manufacturer can continue the distribution of the vaccine involved for 12 months. (c)

Distribution

To the maximum extent practicable, the Secretary shall distribute information on the discontinuation of the manufacture of vaccines to appropriate physician and patient organizations.

.

6.

Program for pediatric vaccine stockpile; participation of manufacturers of vaccines

(a)

In general

Not later than 30 days after the date of the enactment of this Act, the Secretary of Health and Human Services, in consultation with the Chairman of the Securities and Exchange Commission, shall submit to the Congress a plan to facilitate the participation of manufacturers of pediatric vaccines in the program operated by the Secretary to maintain a six-month supply of such vaccines (commonly referred to as the pediatric vaccine stockpile). With respect to the purchase of pediatric vaccines for such program, the plan shall include, as necessary, provisions for the accounting-rules treatment of amounts paid by the Secretary to such manufacturers that will permit the manufacturers to treat the amounts as revenue upon receipt of the amounts. (b)

Definition

For purposes of subsection (a), the term pediatric vaccine means a vaccine on the list referred to in section 1928(e) of the Social Security Act.

7.

Prohibition on Medicaid cost-sharing for vaccines recommended by Advisory Committee on Immunization Practices

(a)

In general

Section 1916 of the Social Security Act (42 U.S.C. 1396o) is amended by adding at the end the following: (h)The State plan shall require that no provider participating under the State plan may impose a copayment, cost sharing charge, or similar charge for administering to an adult individual who is eligible for medical assistance under such plan a vaccine that is included on the recommended vaccine schedule for adults that is established (and periodically reviewed and appropriately revised) by the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention and that is otherwise covered under the State plan. . (b)

Effective date

The amendment made by subsection (a) shall take effect on October 1, 2005.