1.The table of contents of this Act is as follows:
Sec. 1. Table of contents.
Sec. 2. Definitions.
Title I—Insurance reform
Sec. 101. Restoring application of antitrust laws to insurers.
Sec. 102. Premiums and prohibitions on exclusions.
Sec. 103. Guaranteed coverage availability and continuation.
Sec. 104. Increasing the medical loss ratio.
Sec. 105. Limitation of abortion funding.
Sec. 106. Access limited to lawful residents.
Sec. 107. Enforcement and treatment of Medicare, Medicaid, CHIP, and Tricare.
Title II—Medicare and Medicaid Reform
Sec. 201. Medicare Advantage reforms.
Sec. 202. Medicare disparities.
Sec. 203. Establishment of Medicare operated prescription drug plan option.
Sec. 204. Application to pharmacies and pharmacists of the eligible professional exemption from certain Medicare accreditation requirements.
Sec. 205. Providing adequate pharmacy reimbursement.
Title III—Prescription drug importation
Sec. 301. Repeal of certain section regarding importation of prescription drugs.
Sec. 302. Importation of prescription drugs; waiver of certain import restrictions.
Sec. 303. Disposition of certain drugs denied admission into United States.
Sec. 304. Wholesale distribution of drugs; statements regarding prior sale, purchase, or trade.
Sec. 305. Internet sales of prescription drugs.
Sec. 306. Prohibiting payments to unregistered foreign pharmacies.
Sec. 307. Importation exemption under Controlled Substances Import and Export Act.
Sec. 308. Severability.
Title IV—Additional prescription drugs provisions
Sec. 401. Disallowance of deduction for advertising and promotional expenses for prescription pharmaceuticals.
Sec. 402. Integrity for Pharmacy benefit managers.
Sec. 403. Price information under Medicaid.
2.For purposes of titles I and IV:
(1)The term health benefits plan means health insurance coverage and an employment-based health plan and includes the public health insurance option.
(2)Health benefits plan offering entityThe term health benefits plan offering entity means, with respect to a health benefits plan that is—
(A)a group health plan, the plan sponsor in relation to such group health plan, except that, in the case of a plan maintained jointly by 1 or more employers and 1 or more employee organizations and with respect to which an employer is the primary source of financing, such term means such employer;
(B)health insurance coverage, the health insurance issuer offering the coverage;
(C)a non-Federal governmental plan, the State or political subdivision of a State (or agency or instrumentality of such State or subdivision) which establishes or maintains such plan; or
(D)a Federal governmental plan, the appropriate Federal official.
(3)The terms employer, employer, participant, beneficiary, person, plan sponsor, and governmental plan have the meaning given such terms in section 3 of the Employee Retirement Income Security Act of 1974.
(4)The terms group health plan, health insurance coverage, health insurance issuer, group health insurance coverage, applicable State authority, Federal governmental plan, non-Federal governmental plan, State, individual market, large group market, and small group market have the meaning given such terms in section 2971 of the Public Health Service Act.
(5)
(A)The term family means an individual and includes the individual's dependents
(B)The term Secretary means the Secretary of Health and Human Services.
(C)The term dependent has the meaning given such term by the Secretary and includes a spouse.
(D)The term plan year means—
(i)with respect to an employment-based health plan, a plan year as specified under such plan; or
(ii)with respect to a health benefits plan other than an employment-based health plan, a 12-month period as specified by the Secretary.
<enum>I</enum><header>Insurance reform</header>
<section id="H9C32881FADAA44388ABFE173EAB06E70"><enum>101.</enum><header>Restoring application of antitrust laws to insurers</header>
<subsection id="HE088A3084FE9474D952CE7F724ADC734"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Section 3 of the Act of March 9, 1945 (15 U.S.C. 1013), commonly known as the McCarran-Ferguson Act, is amended by adding at the end the following:</text>
<quoted-block display-inline="no-display-inline" id="H41B970DA3FC64C6E8C0C843B7732FC44" style="OLC">
<subsection id="H494BADCDB6B6447DA7FCE273AA8BB35B"><enum>(c)</enum>
<paragraph commented="no" display-inline="yes-display-inline" id="H16B5E05F855048D78CB712B837B52805"><enum>(1)</enum><text>Nothing contained in this Act shall modify, impair, or supersede the operation of any of the antitrust laws with respect to price fixing, market allocation, or monopolization (or attempting to monopolize) by a person engaged in the business of insurance.</text> </paragraph>
<paragraph id="H9B7F180AD1934B978DADFCCFF9939D90" indent="up1"><enum>(2)</enum><text display-inline="yes-display-inline">For purposes of this subsection the term <term>antitrust laws</term> has the meaning given it in subsection (a) of the 1st section of the Clayton Act, except that such term includes section 5 of the Federal Trade Commission Act to the extent that such section 5 applies to unfair methods of competition.</text> </paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="HC161C7FEC92F4098844539B51E2015D0"><enum>(b)</enum><header>Related provision</header><text display-inline="yes-display-inline">For purposes of section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the extent such section applies to unfair methods of competition, section 3(c) of the McCarran-Ferguson Act shall apply with respect to the business of insurance without regard to whether such business is carried on for profit, notwithstanding the definition of <quote>Corporation</quote> contained in section 4 of the Federal Trade Commission Act.</text> </subsection>
<subsection id="HDE9AFA34848C408098262A25846AD061"><enum>(c)</enum><header>Related preservation of antitrust laws</header><text display-inline="yes-display-inline">Except as provided in subsections (a) and (b), nothing in this Act, or in the amendments made by this Act, shall be construed to modify, impair, or supersede the operation of any of the antitrust laws. For purposes of the preceding sentence, the term <term>antitrust laws</term> has the meaning given it in subsection (a) of the 1st 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.</text> </subsection></section>
<section id="HAF9A0973E9F24EFBA2A22C270379C0A0"><enum>102.</enum><header>Premiums and prohibitions on exclusions</header>
<subsection id="H41F8BC060A2B41E6BD8FA0D9176CDA62"><enum>(a)</enum><header>Premium rate variation</header><text>The premium rate charged for a health benefits plan may not vary except as follows:</text>
<paragraph id="H5B05F6F7FED249D885C5F84B66E3876A"><enum>(1)</enum><text>By geographic premium rating area (as permitted by State insurance regulators).</text> </paragraph>
<paragraph id="HA6C4320DFDA14C2597D07E32D6347635"><enum>(2)</enum><text>By family enrollment (such as variations within categories and compositions of families) so long as the ratio of the premium for family enrollment (or enrollments) to the premium for individual enrollment is uniform, as specified under State law.</text> </paragraph></subsection>
<subsection id="H809B840A6CE04CC987347AAA4FEE606E"><enum>(b)</enum><header>Prohibition of preexisting condition exclusions</header><text>A health benefits plan may not impose any preexisting condition exclusion (as defined in section 2701(b)(1)(A) of the Public Health Service Act) or otherwise impose any limit or condition on the coverage under the plan with respect to an individual or dependent based on any of the following: health status, medical condition, claims experience, receipt of health care, medical history, genetic information, evidence of insurability, disability, or source of injury (including conditions arising out of acts of domestic violence) or any similar factors.</text> </subsection></section>
<section id="H8A1C598F72AA408EB26365A5A5C7B9D0"><enum>103.</enum><header>Guaranteed coverage availability and continuation</header>
<subsection id="HD7E9423243784E0D911D994EC7B906ED"><enum>(a)</enum><header>Availability of coverage</header>
<paragraph id="HFD6207FE7460401CACFACFB9BF471A96"><enum>(1)</enum><header>In general</header><text>Subject to paragraph (2), each health benefits plan issuer that offers health insurance coverage in the individual or group market in a State must accept every employer and individual in the State that applies for such coverage.</text> </paragraph>
<paragraph id="H9DE3A658F6ED44F988C0B71B04FC14B5"><enum>(2)</enum><header>Enrollment</header>
<subparagraph id="HFD1A79218BF142218E7664B3645F5F6F"><enum>(A)</enum><header>Restriction</header><text display-inline="yes-display-inline">A health benefits plan issuer described in paragraph (1) may restrict enrollment in coverage described in such subsection to open or special enrollment periods.</text> </subparagraph>
<subparagraph id="H8944C00AC86A4A20873045B7B4801C36"><enum>(B)</enum><header>Establishment</header><text display-inline="yes-display-inline">A health benefits plan issuer described in paragraph (1) shall, in accordance with the regulations promulgated under subparagraph (C), establish special enrollment periods for qualifying events (under section 603 of the Employee Retirement Income Security Act of 1974).</text> </subparagraph>
<subparagraph id="HBA7EB60CE8824E7EA9C27E634E602194"><enum>(C)</enum><header>Regulations</header><text>The Secretary shall promulgate regulations with respect to enrollment periods under subparagraphs (A) and (B).</text> </subparagraph></paragraph></subsection>
<subsection id="HCACD5CE88D9E4B0ABB903D64A8E07DBE"><enum>(b)</enum><header>Guaranteed renewability of coverage</header><text display-inline="yes-display-inline">If a health benefits plan issuer offers health insurance coverage in the individual or group market, the issuer must renew or continue in force such coverage at the option of the plan sponsor or the individual, as applicable.</text> </subsection>
<subsection id="HE634C4DE215840AB9702B1946B9CAF8C"><enum>(c)</enum><header>Prohibition of Rescission</header><text display-inline="yes-display-inline">Rescissions of health insurance coverage offered by a health benefits plan issuer shall be prohibited except in cases of fraud as defined in section 2712(b)(2) of the Public Health Service Act.</text> </subsection></section>
<section id="H5A2CA7539A76401597944DF8CF71C4DD"><enum>104.</enum><header>Increasing the medical loss ratio</header><text display-inline="no-display-inline">Each health benefits plan issuer that offers health insurance coverage in the small or large group market shall provide that for any plan year in which the coverage has a medical loss ratio below 92 percent, the issuer shall provide for rebates to enrollees of the amount by which the issuer’s medical loss ratio is less than the level so specified.</text> </section>
<section commented="no" id="H14B3CFBC168B441AAF145B5213013934"><enum>105.</enum><header>Limitation of abortion funding</header>
<subsection commented="no" id="HEC3B72E2FF11481EAA6F289E9FCB9B8F"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">No Federal funds may be used to pay for any abortion or to cover any part of the costs of any health plan that includes coverage of abortion, except in the case where a woman suffers from a physical disorder, physical injury, or physical illness that would, as certified by a physician, place the woman in danger of death unless an abortion is performed, including a life-endangering physical condition caused by or arising from the pregnancy itself, or unless the pregnancy is the result of an act of rape or incest.</text> </subsection>
<subsection commented="no" id="HF59B1F5AF55D4783BC59E8062B21DF5F"><enum>(b)</enum><header>Option To purchase separate supplemental coverage or plan</header><text>Nothing in this section shall be construed as prohibiting any nonfederal entity (including an individual, a State government, and a local government) from purchasing separate supplemental coverage for abortions for which funding is prohibited under this section, or a plan that includes such abortions, so long as—</text>
<paragraph id="H1EF8E38559494DC098E02C73C7FB36A6"><enum>(1)</enum><text>such coverage or plan is paid for entirely using only nonfederal funds; and</text> </paragraph>
<paragraph id="H3793D0081E5F4BB99E41F7A50EB038E6"><enum>(2)</enum><text>such coverage or plan is not purchased using nonfederal funds that are required to receive a federal payment, including a State’s or locality’s contribution of Medicaid matching funds.</text> </paragraph></subsection>
<subsection commented="no" id="H2BAAB1D63CA241A0857398FEB5A4FB03"><enum>(c)</enum><header>Option To offer separate supplemental coverage or plan</header><text>Nothing in this section shall restrict any nonfederal health benefits plan offering entity from offering separate supplemental coverage for abortions for which funding is prohibited under this section, or a plan that includes such abortions, so long as—</text>
<paragraph id="H4DC4CB2071944848A9049F5F37B93EF7"><enum>(1)</enum><text>premiums for such separate supplemental coverage or plan are paid for entirely with nonfederal funds; and</text> </paragraph>
<paragraph id="HB469797B76B547C3812D4D556CDF2BDE"><enum>(2)</enum><text>administrative costs and all services offered through such supplemental coverage or plan are paid for using only premiums collected for such coverage or plan.</text> </paragraph></subsection></section>
<section id="H38EFB29225AF4871BFCEFD6A110159E6"><enum>106.</enum><header>Access limited to lawful residents</header>
<subsection id="H24CF9E775E6043AF94EB0D299294A5AF"><enum>(a)</enum><header>Sale of insurance</header><text display-inline="yes-display-inline">A health benefits plan issuer may not sell health insurance coverage under a health benefits plan, if, at the time of such sale, a participant or beneficiary of such plan is not, or is not reasonably expected to be for the entire period for which enrollment is sought, a citizen or national of the United States or an alien lawfully present in the United States.</text> </subsection>
<subsection id="H75EA36FBB52348989E98D8B8F9E325FE"><enum>(b)</enum><header>Enrollment</header><text display-inline="yes-display-inline">A health benefits plan issuer may not enroll a participant or beneficiary in a health benefits plan, if, at the time of such enrollment, such participant or beneficiary is not, or is not reasonably expected to be for the entire period for which enrollment is sought, a citizen or national of the United States or an alien lawfully present in the United States.</text> </subsection></section>
<section id="HB2E958ED4C5D4F17882E0A082C88937A"><enum>107.</enum><header>Enforcement and treatment of Medicare, Medicaid, CHIP, and Tricare</header>
<subsection id="H8015B61138764601AB292A81097599C3"><enum>(a)</enum><header>Enforcement</header><text display-inline="yes-display-inline">For purposes of enforcement, the provisions of this title shall be treated as if included such provisions were included in title XXVII of the Public Health Service Act, title VII of the Employee Retirement Income Security Act of 1974, and chapter 89 of title 5, United States Code.</text> </subsection>
<subsection id="H5B9C4DDE8F984D848DB634FA6E71790A"><enum>(b)</enum><header>Treatment of Medicare, Medicaid, CHIP, and Tricare</header><text display-inline="yes-display-inline">The provisions of sections 102, 103, and 104 shall not apply to the Medicare, Medicaid, and CHIP programs under titles XVIII, XIX, and XXI of the Social Security Act, respectively, or to Tricare.</text> </subsection></section>
<enum>II</enum><header>Medicare and Medicaid Reform</header>
<section id="HCAD7E55DA9434A34ABB3F7DD3FFDEEAF"><enum>201.</enum><header>Medicare Advantage reforms</header>
<subsection id="HB72FA52B84284DDF83F4F358B1A38FAB"><enum>(a)</enum><header>Phase-In of payment based on fee-for-Service costs</header><text>Section 1853 of the Social Security Act (42 U.S.C. 1395w–23) is amended—</text>
<paragraph id="H7C636229D3444318B3EB1BC0E99C0222"><enum>(1)</enum><text>in subsection (j)(1)(A)—</text>
<subparagraph id="H57CB68351E994E30897429E0207BE445"><enum>(A)</enum><text>by striking ‘‘beginning with 2007’’ and inserting ‘‘for 2007, 2008, 2009, and 2010’’; and—</text> </subparagraph>
<subparagraph id="H2DD1FB67256A4FF9A30ABB2B5FD3036B"><enum>(B)</enum><text>by inserting after ‘‘(k)(1)’’ the following: ‘‘, or, beginning with 2011, <fraction>1⁄12</fraction> of the blended benchmark amount determined under subsection (n)(1)’’; and</text> </subparagraph></paragraph>
<paragraph id="HB3ED4961D8BC447ABED8CACFBA6F3FD5"><enum>(2)</enum><text>by adding at the end the following new subsection: <italic></italic></text>
<quoted-block display-inline="no-display-inline" id="H276BCAC5C4B845C9BE6701DE1FC8C829" style="OLC">
<subsection id="H4927DDC8BE2347E595DBA4B66C9C5077"><enum>(n)</enum><header>Determination of Blended Benchmark Amount</header>
<paragraph id="H97C322D5CBF4496F95760A9A80EA0150"><enum>(1)</enum><header>In general</header><text>For purposes of subsection (j), subject to paragraphs (3) and (4), the term <term>blended benchmark amount</term> means for an area—</text>
<subparagraph id="H34F94F295E3549CAA855C2DEE6C353B6"><enum>(A)</enum><text>for 2011 the sum of—</text>
<clause id="H8E27E51B0A934E5786CBE0DA95BB403C"><enum>(i)</enum><text><fraction>2/3</fraction> of the applicable amount (as defined in subsection (k)) for the area and year; and</text> </clause>
<clause id="H5B7D6FE72E784A089AAF372380CE407B"><enum>(ii)</enum><text><fraction>1/3</fraction> of the amount specified in paragraph (2) for the area and year;</text> </clause></subparagraph>
<subparagraph id="HBB6A3D36DE81479AAF05DC61D46166BF"><enum>(B)</enum><text>for 2012 the sum of—</text>
<clause id="H076AADA268724E4687C118E6D0786DE8"><enum>(i)</enum><text><fraction>1/3</fraction> of the applicable amount for the area and year; and</text> </clause>
<clause id="H43BF9621A3E94CE2A5DC5154C2083DDE"><enum>(ii)</enum><text><fraction>2/3</fraction> of the amount specified in paragraph (2) for the area and year; and</text> </clause></subparagraph>
<subparagraph id="H598E7E576B3446AAB0DB61E76FAC2844"><enum>(C)</enum><text>for a subsequent year the amount specified in paragraph (2) for the area and year.</text> </subparagraph></paragraph>
<paragraph id="H5D65B15C00994B9FA00133C16579018C"><enum>(2)</enum><header>Specified amount</header><text>The amount specified in this paragraph for an area and year is the amount specified in subsection (c)(1)(D)(i) for the area and year adjusted (in a manner specified by the Secretary) to take into account the phase-out in the indirect costs of medical education from capitation rates described in subsection (k)(4).</text> </paragraph>
<paragraph id="HEDA33BCE8BB948E0BEA937AA7D757B91"><enum>(3)</enum><header>Fee-for-service payment floor</header><text>In no case shall the blended benchmark amount for an area and year be less than the amount specified in paragraph (2).</text> </paragraph>
<paragraph id="H1016881F4F70472A9C5FD139F736F166"><enum>(4)</enum><header>Exception for PACE plans</header><text>This subsection shall not apply to payments to a PACE program under section 1894.</text> </paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></subsection>
<subsection id="H5FA79155D2D94DE7A235D9E0A437BD78"><enum>(b)</enum><header>Elimination of Medicare advantage regional stabilization plan</header>
<paragraph id="HDC3E69B7E0354E75A3F46B3F43B8C444"><enum>(1)</enum><header>In general</header><text display-inline="yes-display-inline">Section 1858 of the Social Security Act (42 U.S.C. 1395w–27a) is amended by striking subsection (e).</text> </paragraph>
<paragraph id="H1B3A9A9C6928495E9AC29918D0561106"><enum>(2)</enum><header>Transition</header><text>Any amount contained in the MA Regional Plan Stabilization Fund as of the date of the enactment of this Act shall be transferred to the Federal Supplementary Medical Insurance Trust Fund.</text> </paragraph></subsection></section>
<section id="H78FB91864E0046ADB855C526817C740B"><enum>202.</enum><header>Medicare disparities</header>
<subsection id="H64F7428F11604B6DA3941572F9D55945"><enum>(a)</enum><header>Floor on the Medicare Hospital Area Wage Index</header>
<paragraph id="HCB48EA072D214857AC7C1481202D3A45"><enum>(1)</enum><header>In general</header><text>Section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended—</text>
<subparagraph id="H0F923D3048D64AB980829CB19C4105D0"><enum>(A)</enum><text>in clause (i), by striking <quote>clause (ii)</quote> and inserting <quote>clause (ii) or (iii)</quote>; and—</text> </subparagraph>
<subparagraph id="H44AE20DED7224CEEAC0A30A5381CCE83"><enum>(B)</enum><text>by adding at the end of the following new clause:</text>
<quoted-block display-inline="no-display-inline" id="H20030DA2750A417BBB6B18DE16CF9796" style="OLC">
<clause id="HFC3E29BDCB70401AA81B6DADD1D941E0"><enum>(iii)</enum><header>Floor on area wage index</header><text display-inline="yes-display-inline">For discharges occurring on or after October 1, 2010, the area wage index applicable under this subparagraph to any hospital may not be less than 1.00.</text> </clause><after-quoted-block>.</after-quoted-block></quoted-block> </subparagraph></paragraph></subsection>
<subsection id="HF8C883EA71DC4F328CDAD8BA247FF089"><enum>(b)</enum><header>Increase the Physician Fee Schedule Practice Expense Geographic Adjustment</header><text display-inline="yes-display-inline">Section 1848(e)(1) is amended by adding after subparagraph (E) the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H1FC87BE775A74E44BC5DB23ED16BD732" style="OLC">
<subparagraph id="H45798912E1244BA08AB9B3CAB602BE9E"><enum>(F)</enum><header>Floor for practice expense geographic index</header><text display-inline="yes-display-inline">After calculating the practice expense geographic index in subparagraph (A)(i), for purposes of payment for services furnished on or after October 1, 2010, the Secretary shall increase the practice expense geographic index to 1.00 for any locality for which such practice expense geographic index is less than 1.00.</text> </subparagraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection></section>
<section commented="no" id="H67D1ED2E321742068C7AC7BE6984945C"><enum>203.</enum><header>Establishment of Medicare operated prescription drug plan option</header>
<subsection commented="no" id="H9B5B428ECDCE465BB83797C1530540F3"><enum>(a)</enum><header>In general</header><text>Subpart 2 of part D of the Social Security Act is amended by inserting after section 1860D–11 (42 U.S.C. 1395w–111) the following new section:</text>
<quoted-block act-name="Social Security Act" id="H4C87AE4ABB7E434B891EC29CBBAB40BA" style="traditional">
<section commented="no" id="HB6E151F93BA045B898EE62B14CFBF0BD"><enum>1860D–11A.</enum><header>Medicare operated prescription drug plan option</header>
<subsection commented="no" display-inline="yes-display-inline" id="H650F47F811FC463B8D3CB97350D404A8"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Notwithstanding any other provision of this part, for each year (beginning with 2011), in addition to any plans offered under section 1860D–11, the Secretary—</text>
<paragraph id="HBD4288DE740643DF8B3EA9256647644E"><enum>(1)</enum><text>shall offer one or more Medicare operated prescription drug plans (as defined in subsection (c)) with a service area that consists of the entire United States; and</text> </paragraph>
<paragraph id="H46DEE801CCF446A4A05002713981C4D2"><enum>(2)</enum><text>shall enter into negotiations, in accordance with subsection (b), with pharmaceutical manufacturers to reduce the purchase cost of covered part D drugs for eligible part D individuals who enroll in such a plan.</text> </paragraph></subsection>
<subsection commented="no" id="HA35EF74B39F14C9483A36F5CFC5ED4C7"><enum>(b)</enum><header>Negotiations</header><text display-inline="yes-display-inline">Notwithstanding section 1860D–11(i), for purposes of offering a medicare operated prescription drug plan under this section, the Secretary shall negotiate with pharmaceutical manufacturers with respect to the purchase price of covered part D drugs for a Medicare operated prescription drug plan and shall encourage the use of more affordable therapeutic equivalents to the extent such practices do not override medical necessity as determined by the prescribing physician. To the extent practicable and consistent with the previous sentence, the Secretary shall implement strategies similar to those used by other Federal purchasers of prescription drugs, and other strategies, including the use of a formulary and formulary incentives in subsection (e), to reduce the purchase cost of covered part D drugs.</text> </subsection>
<subsection commented="no" id="HBC63F5BC1AF0424284B755E45B933164"><enum>(c)</enum><header>Medicare operated prescription drug plan defined</header><text>For purposes of this part, the term <term>medicare operated prescription drug plan</term> means a prescription drug plan that offers qualified prescription drug coverage and access to negotiated prices described in section 1860D–2(a)(1)(A). Such a plan may offer supplemental prescription drug coverage in the same manner as other qualified prescription drug coverage offered by other prescription drug plans.</text> </subsection>
<subsection commented="no" id="H83F299F46F9B4DC18D02C2EB536FC28A"><enum>(d)</enum><header>Monthly beneficiary premium</header>
<paragraph commented="no" id="HC47AEA898EFC471EA1FDE395CCA03696"><enum>(1)</enum><header>Qualified prescription drug coverage</header><text>The monthly beneficiary premium for qualified prescription drug coverage and access to negotiated prices described in section 1860D–2(a)(1)(A) to be charged under a medicare operated prescription drug plan shall be uniform nationally. Such premium for months in 2010 and each succeeding year shall be based on the average monthly per capita actuarial cost of offering the medicare operated prescription drug plan for the year involved, including administrative expenses.</text> </paragraph>
<paragraph commented="no" id="H2CEFE9A9D3F04F82B7779A3E70B80BB9"><enum>(2)</enum><header>Supplemental prescription drug coverage</header><text>Insofar as a medicare operated prescription drug plan offers supplemental prescription drug coverage, the Secretary may adjust the amount of the premium charged under paragraph (1).</text> </paragraph></subsection>
<subsection commented="no" id="HF7868EF3958743D9A82F6D58CE42BAEC"><enum>(e)</enum><header>Use of a formulary and formulary incentives</header>
<paragraph commented="no" id="H1D752D26D703432DA8740F3EAF6B75EB"><enum>(1)</enum><header>In general</header><text display-inline="yes-display-inline">With respect to the operation of a medicare operated prescription drug plan, the Secretary shall establish and apply a formulary (and may include formulary incentives described in paragraph (2)(C)(ii)) in accordance with this subsection in order to—</text>
<subparagraph commented="no" id="H25220A50EA2E4A4DA3B9D513C904F785"><enum>(A)</enum><text>increase patient safety;</text> </subparagraph>
<subparagraph commented="no" id="H6DFACE7C0B62415FA9DE05756519AAFD"><enum>(B)</enum><text display-inline="yes-display-inline">increase appropriate use and reduce inappropriate use of drugs; and</text> </subparagraph>
<subparagraph commented="no" id="HFCFBB6FEA7554FD08D93D9D4EDB0959F"><enum>(C)</enum><text>reward value.</text> </subparagraph></paragraph>
<paragraph commented="no" id="H77976328327746ED9262E676D627AFFE"><enum>(2)</enum><header>Development of initial formulary</header>
<subparagraph commented="no" id="HE3C5DF3704C84463B916797E517AE9BA"><enum>(A)</enum><header>In general</header><text display-inline="yes-display-inline">In selecting covered part D drugs for inclusion in a formulary, the Secretary shall consider clinical benefit and price of such drug.</text> </subparagraph>
<subparagraph commented="no" id="H59EEF082C2E449DA9319375531530495"><enum>(B)</enum><header>Role of AHRQ</header><text display-inline="yes-display-inline">The Director of the Agency for Healthcare Research and Quality shall be responsible for assessing the clinical benefit of covered part D drugs and making recommendations to the Secretary regarding which drugs should be included in the formulary. In conducting such assessments and making such recommendations, the Director shall—</text>
<clause commented="no" id="HE4FF7B0A998C4E84ACF030A7DFDB19A6"><enum>(i)</enum><text>consider safety concerns, including those identified by the Federal Food and Drug Administration;</text> </clause>
<clause commented="no" id="H7F5E465CA3CC46C0BE0AA98F039A28CE"><enum>(ii)</enum><text display-inline="yes-display-inline">use available data and evaluations, with priority given to randomized controlled trials, to examine clinical effectiveness, comparative effectiveness, safety, and enhanced compliance with a drug regimen;</text> </clause>
<clause commented="no" id="HCC71F702B5AE48DBAD1077DBA3B4802A"><enum>(iii)</enum><text>use the same classes of drugs developed by United States Pharmacopeia for this part;</text> </clause>
<clause commented="no" id="HF65F689D64274610BE2E08C7AF31DF7D"><enum>(iv)</enum><text>consider evaluations made by—</text>
<subclause commented="no" id="HEE7839364CDD4EDDA4323E3400F2CB63"><enum>(I)</enum><text>the Director under section 1013 of Medicare Prescription Drug, Improvement, and Modernization Act of 2003;</text> </subclause>
<subclause commented="no" id="H7D93050ADBC64E87819C78A1789BF702"><enum>(II)</enum><text>other Federal entities, such as the Secretary of Veterans Affairs; and</text> </subclause>
<subclause commented="no" id="H5BF89E53EE6C4C258C0ED9CD29B4337E"><enum>(III)</enum><text>other private and public entities, such as the Drug Effectiveness Review Project and Medicaid programs; and</text> </subclause></clause>
<clause commented="no" id="H73F49202EB59424B94A46D2661792F45"><enum>(v)</enum><text>recommend to the Secretary—</text>
<subclause commented="no" id="H89DC0F622AFD4F04A039734BF3DD0363"><enum>(I)</enum><text display-inline="yes-display-inline">those drugs in a class that provide a greater clinical benefit, including fewer safety concerns or less risk of side-effects, than another drug in the same class that should be included in the formulary;</text> </subclause>
<subclause commented="no" id="H57878F5CA0034FA78F5673D9560AB977"><enum>(II)</enum><text display-inline="yes-display-inline">those drugs in a class that provide less clinical benefit, including greater safety concerns or a greater risk of side-effects, than another drug in the same class that should be excluded from the formulary; and</text> </subclause>
<subclause commented="no" id="H510FA57BB6514594B4CFA1A2DB6881BD"><enum>(III)</enum><text>drugs in a class with same or similar clinical benefit for which it would be appropriate for the Secretary to competitively bid (or negotiate) for placement on the formulary.</text> </subclause></clause></subparagraph>
<subparagraph commented="no" id="HDA3B0A7956AE4A998ABCFABCD0F2DC2B"><enum>(C)</enum><header>Consideration of AHRQ recommendations</header>
<clause commented="no" id="H6989CC4FFB5D4BBDA2BC1B50C518D257"><enum>(i)</enum><header>In general</header><text display-inline="yes-display-inline">The Secretary, after taking into consideration the recommendations under subparagraph (B)(v), shall establish a formulary, and formulary incentives, to encourage use of covered part D drugs that—</text>
<subclause commented="no" id="H6572BD76538B4F29A437B8E48050C6C6"><enum>(I)</enum><text display-inline="yes-display-inline">have a lower cost and provide a greater clinical benefit than other drugs;</text> </subclause>
<subclause commented="no" id="H130793AAA2D640B5B67E63F86D985467"><enum>(II)</enum><text display-inline="yes-display-inline">have a lower cost than other drugs with same or similar clinical benefit; and</text> </subclause>
<subclause commented="no" id="H134C35DA48144BB5BFAC0AC5E5CC9CED"><enum>(III)</enum><text display-inline="yes-display-inline">drugs that have the same cost but provide greater clinical benefit than other drugs.</text> </subclause></clause>
<clause commented="no" id="H6889A79BD12046E08C01089094FC11C2"><enum>(ii)</enum><header>Formulary incentives</header><text display-inline="yes-display-inline">The formulary incentives under clause (i) may be in the form of one or more of the following: <italic></italic></text>
<subclause commented="no" id="H0F0A8D1348D54107B4D0612AAEB81359"><enum>(I)</enum><text display-inline="yes-display-inline">Tiered copayments.</text> </subclause>
<subclause commented="no" id="HC9C0DEC6506441FA9A1B7065A544E8FA"><enum>(II)</enum><text>Reference pricing.</text> </subclause>
<subclause commented="no" id="H9EA547BA7A33441B8164E1E408D74D9C"><enum>(III)</enum><text>Prior authorization.</text> </subclause>
<subclause commented="no" id="HEA736FF250C4415FBBB36B5136082CBB"><enum>(IV)</enum><text>Step therapy.</text> </subclause>
<subclause commented="no" id="HF7A896F0F55B4109B48FBCF097239A21"><enum>(V)</enum><text>Medication therapy management.</text> </subclause>
<subclause commented="no" id="HC8CDF2F03E2C49809C82B787984EFCF1"><enum>(VI)</enum><text display-inline="yes-display-inline">Generic drug substitution.</text> </subclause></clause>
<clause commented="no" id="HA379F54544C748FBA6DE7D0B89CFF892"><enum>(iii)</enum><header>Flexibility</header><text display-inline="yes-display-inline">In applying such formulary incentives the Secretary may decide not to impose any cost-sharing for a covered part D drug for which—</text>
<subclause commented="no" id="HA00DDE9A8ED94EB0A99FB4505ACC82E1"><enum>(I)</enum><text>the elimination of cost sharing would be expected to increase compliance with a drug regimen; and</text> </subclause>
<subclause commented="no" id="H36747A079E364056831C41C52853E95D"><enum>(II)</enum><text>compliance would be expected to produce savings under part A or B or both.</text> </subclause></clause></subparagraph></paragraph>
<paragraph commented="no" id="HB3A836FC833742CBA6C5EB28D4CD2C74"><enum>(3)</enum><header>Limitations on formulary</header><text>In any formulary established under this subsection, the formulary may not be changed during a year, except—</text>
<subparagraph commented="no" id="HFA8AD69D80F34EDC9053C31184AE10FC"><enum>(A)</enum><text>to add a generic version of a covered part D drug that entered the market;</text> </subparagraph>
<subparagraph commented="no" id="H368306E310954417985634AE602C79E7"><enum>(B)</enum><text>to remove a drug for which a safety problem is found; and</text> </subparagraph>
<subparagraph commented="no" id="H15788B63A64F46D8A625CD121C6310C7"><enum>(C)</enum><text display-inline="yes-display-inline">to add a drug that the Secretary identifies as a drug which treats a condition for which there has not previously been a treatment option or for which a clear and significant benefit has been demonstrated over other covered part D drugs.</text> </subparagraph></paragraph>
<paragraph commented="no" id="H022383EAA6E844A4A80F841264AA532A"><enum>(4)</enum><header>Adding drugs to the initial formulary</header>
<subparagraph commented="no" id="H18853C1DACF24A86B82F266F053E0EE1"><enum>(A)</enum><header>Use of advisory committee</header><text display-inline="yes-display-inline">The Secretary shall establish and appoint an advisory committee (in this paragraph referred to as the <quote>advisory committee</quote>)—</text>
<clause commented="no" id="HC7522DD8079F4ACFB8CFCAE8CB8F6DD3"><enum>(i)</enum><text display-inline="yes-display-inline">to review petitions from drug manufacturers, health care provider organizations, patient groups, and other entities for inclusion of a drug in, or other changes to, such formulary; and</text> </clause>
<clause commented="no" id="HD05E3B627A894375823DBA4A49505F51"><enum>(ii)</enum><text>to recommend any changes to the formulary established under this subsection.</text> </clause></subparagraph>
<subparagraph commented="no" id="H2A384886497E44868850CC0AF10883FB"><enum>(B)</enum><header>Composition</header><text display-inline="yes-display-inline">The advisory committee shall be composed of 9 members and shall include representatives of physicians, pharmacists, and consumers and others with expertise in evaluating prescription drugs. The Secretary shall select members based on their knowledge of pharmaceuticals and the Medicare population. Members shall be deemed to be special Government employees for purposes of applying the conflict of interest provisions under section 208 of title 18, United States Code, and no waiver of such provisions for such a member shall be permitted.</text> </subparagraph>
<subparagraph commented="no" id="HE6DABC4029784E8CB4580B3748FF5188"><enum>(C)</enum><header>Consultation</header><text>The advisory committee shall consult, as necessary, with physicians who are specialists in treating the disease for which a drug is being considered.</text> </subparagraph>
<subparagraph commented="no" id="H1B2033298699411E8A397B52032EAD2D"><enum>(D)</enum><header>Request for studies</header><text display-inline="yes-display-inline">The advisory committee may request the Agency for Healthcare Research and Quality or an academic or research institution to study and make a report on a petition described in subparagraph (A)(ii) in order to assess—</text>
<clause commented="no" id="HB2BBE64CCD7F4A2BB6767F9C8B3A4285"><enum>(i)</enum><text>clinical effectiveness;</text> </clause>
<clause commented="no" id="H303972E564FC4A6F961F7AAF72C85396"><enum>(ii)</enum><text>comparative effectiveness;</text> </clause>
<clause commented="no" id="H5D33C29E07F94DBAB6BBD359C2E42183"><enum>(iii)</enum><text>safety; and</text> </clause>
<clause commented="no" id="HE444BD07EE324349B6B3F46AE8E80E0C"><enum>(iv)</enum><text>enhanced compliance with a drug regimen.</text> </clause></subparagraph>
<subparagraph commented="no" id="HE5F88F66B882494CA162B7EF059C0972"><enum>(E)</enum><header>Recommendations</header><text>The advisory committee shall make recommendations to the Secretary regarding—</text>
<clause commented="no" id="HABCD6BA5CCC84946BECCA2495CDF5915"><enum>(i)</enum><text display-inline="yes-display-inline">whether a covered part D drug is found to provide a greater clinical benefit, including fewer safety concerns or less risk of side-effects, than another drug in the same class that is currently included in the formulary and should be included in the formulary;</text> </clause>
<clause commented="no" id="HA0100112DD6649F599D5FFE9ADAAE929"><enum>(ii)</enum><text display-inline="yes-display-inline">whether a covered part D drug is found to provide less clinical benefit, including greater safety concerns or a greater risk of side-effects, than another drug in the same class that is currently included in the formulary and should not be included in the formulary; and</text> </clause>
<clause commented="no" id="HE8B08E74274F434087CCA2EC12DFCAC7"><enum>(iii)</enum><text>whether a covered part D drug has the same or similar clinical benefit to a drug in the same class that is currently included in the formulary and whether the drug should be included in the formulary.</text> </clause></subparagraph>
<subparagraph commented="no" id="HD7D32804B39E4E14AECC0A0CA82DEB38"><enum>(F)</enum><header>Limitations on review of manufacturer petitions</header><text display-inline="yes-display-inline">The advisory committee shall not review a petition of a drug manufacturer under subparagraph (A)(ii) with respect to a covered part D drug unless the petition is accompanied by the following:</text>
<clause commented="no" id="H886D87CA8BC24D499565E8D29AE01CE7"><enum>(i)</enum><text display-inline="yes-display-inline">Raw data from clinical trials on the safety and effectiveness of the drug.</text> </clause>
<clause commented="no" id="HB2F7DFC57EA2419DB381C610E272FE9D"><enum>(ii)</enum><text>Any data from clinical trials conducted using active controls on the drug or drugs that are the current standard of care.</text> </clause>
<clause commented="no" id="HAD47B89ED46E4ACB8C96BB460ACC45E3"><enum>(iii)</enum><text>Any available data on comparative effectiveness of the drug.</text> </clause>
<clause commented="no" id="H012E1936C1D14279B12A48B910EA61EE"><enum>(iv)</enum><text>Any other information the Secretary requires for the advisory committee to complete its review.</text> </clause></subparagraph>
<subparagraph commented="no" id="H1637BB4FDC1D4A92AF49394AFEB90E6C"><enum>(G)</enum><header>Response to recommendations</header><text display-inline="yes-display-inline">The Secretary shall review the recommendations of the advisory committee and if the Secretary accepts such recommendations the Secretary shall modify the formulary established under this subsection accordingly. Nothing in this section shall preclude the Secretary from adding to the formulary a drug for which the Director of the Agency for Healthcare Research and Quality or the advisory committee has not made a recommendation.</text> </subparagraph>
<subparagraph commented="no" id="HF05FD48483B440C0B85E196C326F83F3"><enum>(H)</enum><header>Notice of changes</header><text display-inline="yes-display-inline">The Secretary shall provide timely notice to beneficiaries and health professionals about changes to the formulary or formulary incentives.</text> </subparagraph></paragraph></subsection>
<subsection commented="no" id="H13B91596D2754930A50C02FD0BA89ABA"><enum>(f)</enum><header>Informing beneficiaries</header><text display-inline="yes-display-inline">The Secretary shall take steps to inform beneficiaries about the availability of a Medicare operated drug plan or plans including providing information in the annual handbook distributed to all beneficiaries and adding information to the official public Medicare website related to prescription drug coverage available through this part.</text> </subsection>
<subsection commented="no" id="H1B73370A4A1E404681AB70092980A935"><enum>(g)</enum><header>Application of all other requirements for prescription drug plans</header><text>Except as specifically provided in this section, any Medicare operated drug plan shall meet the same requirements as apply to any other prescription drug plan, including the requirements of section 1860D–4(b)(1) relating to assuring pharmacy access).</text> </subsection></section><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection commented="no" id="H7F551D8D0AC14C9487085A2B24533E33"><enum>(b)</enum><header>Conforming amendments</header>
<paragraph commented="no" id="H216993F7C3504DF8AE9A8BF3E6314DBA"><enum>(1)</enum><text>Section 1860D–3(a) of the <act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C. 1395w–103(a)) is amended by adding at the end the following new paragraph:</text>
<quoted-block act-name="Social Security Act" id="HE97397D1D689489ABAED0E5516EF644D">
<paragraph commented="no" id="H99AF8376553340C484C2668D19F7A981"><enum>(4)</enum><header>Availability of the medicare operated prescription drug plan</header><text>A medicare operated prescription drug plan (as defined in section 1860D–11A(c)) shall be offered nationally in accordance with section 1860D–11A.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph>
<paragraph commented="no" display-inline="no-display-inline" id="H2BDFFFBEDCF243EA8CEDF111611AF3EA"><enum>(2)</enum>
<subparagraph commented="no" display-inline="yes-display-inline" id="H910854F836304D6CA267A8ADA14F4A51"><enum>(A)</enum><text>Section 1860D–3 of the Social Security Act (42 U.S.C. 1395w–103) is amended by adding at the end the following new subsection:</text>
<quoted-block id="H343B5A0D5D6741419AF675C05044AAF6" style="OLC">
<subsection commented="no" id="H2CCB3A9CC08B45238F7CE8567010BEAD"><enum>(c)</enum><header>Provisions only applicable in 2006, 2007, 2008, and 2009</header><text>The provisions of this section shall only apply with respect to 2006, 2007, 2008, and 2009.</text> </subsection><after-quoted-block>.</after-quoted-block></quoted-block> </subparagraph>
<subparagraph commented="no" id="H7707D6217E7A43DA802ABDCEB0790487" indent="up1"><enum>(B)</enum><text>Section 1860D–11(g) of such Act (42 U.S.C. 1395w–111(g)) is amended by adding at the end the following new paragraph:</text>
<quoted-block id="H662538181E7F4DC69CFBA8CE8405FC83" style="OLC">
<paragraph commented="no" id="H9D3663F675B8420AA277653C59DF707A"><enum>(8)</enum><header>No authority for fallback plans after 2009</header><text>A fallback prescription drug plan shall not be available after December 31, 2009.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subparagraph></paragraph>
<paragraph commented="no" id="H27522B8D805F42CF9F1C7AA0578D40CB"><enum>(3)</enum><text>Section 1860D–13(c)(3) of such Act (42 U.S.C. 1395w–113(c)(3)) is amended—</text>
<subparagraph commented="no" id="H21D9B9D86E264DE59366628B1D609393"><enum>(A)</enum><text>in the heading, by inserting <quote><header-in-text level="paragraph" style="OLC">and Medicare operated prescription drug plans</header-in-text></quote> after <quote><header-in-text level="paragraph" style="OLC">Fallback plans</header-in-text></quote>; and</text> </subparagraph>
<subparagraph commented="no" id="H5B2C7109F2EE4DCCA833FA1B222301D3"><enum>(B)</enum><text display-inline="yes-display-inline">by inserting <quote>or a medicare operated prescription drug plan</quote> after <quote>a fallback prescription drug plan</quote>.</text> </subparagraph></paragraph>
<paragraph commented="no" id="H54AA43F877AC4E988CEB25A7F57D716B"><enum>(4)</enum><text>Section 1860D–16(b)(1) of such Act (42 U.S.C.1395w–116(b)(1)) is amended—</text>
<subparagraph commented="no" id="HF5393F2AFC8B4BA1A85FFD30109AEA2B"><enum>(A)</enum><text>in subparagraph (C), by striking <quote>and</quote> after the semicolon at the end;</text> </subparagraph>
<subparagraph commented="no" id="H824AEB6885BA45328393DA69B9E2FD47"><enum>(B)</enum><text>in subparagraph (D), by striking the period at the end and inserting <quote>; and</quote>; and</text> </subparagraph>
<subparagraph commented="no" id="HDAEF2E47A0E54436A13B3640D913A070"><enum>(C)</enum><text>by adding at the end the following new subparagraph:</text>
<quoted-block id="H6DFBCFD67F25401A84847A5CD60BC6F4">
<subparagraph commented="no" id="H84B9E5DA632A4E6A9C901424EAE41D0A"><enum>(E)</enum><text>payments for expenses incurred with respect to the operation of medicare operated prescription drug plans under section 1860D–11A.</text> </subparagraph><after-quoted-block>.</after-quoted-block></quoted-block> </subparagraph></paragraph>
<paragraph commented="no" id="HCA408EB7826F4FB1A8E66A6BCAB8C5C1"><enum>(5)</enum><text>Section 1860D–41(a) of such Act (42 U.S.C. 1395w–151(a)) is amended by adding at the end the following new paragraph:</text>
<quoted-block id="HCEDF08E724194271A58E90963503852C">
<paragraph commented="no" id="H810BC514A9F04C899BFC021840D9F6D2"><enum>(19)</enum><header>Medicare operated prescription drug plan</header><text>The term <term>medicare operated prescription drug plan</term> has the meaning given such term in section 1860D–11A(c).</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></subsection>
<subsection commented="no" id="H9D03AD09412F465181909D11E2DA25CA"><enum>(c)</enum><header>Improved appeals process under the medicare operated prescription drug plan</header><text>Section 1860D–4(h) of the Social Security Act (42 U.S.C. 1305w–104(h)) is amended by adding at the end the following new paragraph:</text>
<quoted-block display-inline="no-display-inline" id="H317158D9B9F94024847E1FF23CF42925" style="OLC">
<paragraph commented="no" id="H0F57F9DFA2AD44BD883367C3A8E7B0D5"><enum>(4)</enum><header>Appeals process for medicare operated prescription drug plan</header>
<subparagraph commented="no" id="H11ED6E2CD1654D378ADED35B34124DBF"><enum>(A)</enum><header>In general</header><text display-inline="yes-display-inline">The Secretary shall develop a well-defined process for appeals for denials of benefits under this part under the Medicare operated prescription drug plan. Such process shall be efficient, impose minimal administrative burdens, and ensure the timely procurement of non-formulary drugs or exemption from formulary incentives when medically necessary. Medical necessity shall be based on professional medical judgment, the medical condition of the beneficiary, and other medical evidence. Such appeals process shall include—</text>
<clause commented="no" id="H63B7F0B7F57448E3945AEE3018BA8FFC"><enum>(i)</enum><text>an initial review and determination made by the Secretary; and</text> </clause>
<clause commented="no" id="H1A970F1DFA7D47EF81EE2A54C887E338"><enum>(ii)</enum><text>for appeals denied during the initial review and determination, the option of an external review and determination by an independent entity selected by the Secretary.</text> </clause></subparagraph>
<subparagraph commented="no" id="HF99BCD453B1A440B9B4937BCBF71DA70"><enum>(B)</enum><header>Consultation in development of process</header><text>In developing the appeals process under subparagraph (A), the Secretary shall consult with consumer and patient groups, as well as other key stakeholders to ensure the goals described in subparagraph (A) are achieved.</text> </subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection commented="no" id="HD8C7A3541B6F47E780F758D4F25E765C"><enum>(d)</enum><header>Effective date</header><text>The amendments made by this section shall take effect on January 1, 2011.</text> </subsection></section>
<section id="HF01828B4F09E42AF9455078A9F547A1D" section-type="subsequent-section"><enum>204.</enum><header>Application to pharmacies and pharmacists of the eligible professional exemption from certain Medicare accreditation requirements</header><text display-inline="no-display-inline">Section 1834(a)(20)(F)(ii) of the Social Security Act (42 U.S.C. 1395m(a)(20)(F)(ii)) is amended—</text>
<paragraph id="H5C425F25A7D44E02A5739A65CA563408"><enum>(1)</enum><text>by inserting <quote>pharmacies, and pharmacists,</quote> after <quote>eligible professionals (as defined in section 1848(k)(3)(B)),</quote>; and</text> </paragraph>
<paragraph id="HF715DC54262846EEA1FA33A706C89324"><enum>(2)</enum><text>by inserting <quote>, pharmacies, pharmacists,</quote> after <quote>such professionals</quote> each place it appears.</text> </paragraph></section>
<section display-inline="no-display-inline" id="H89F3CEC15B62452D9B05CE864E6ACE72" section-type="subsequent-section"><enum>205.</enum><header>Providing adequate pharmacy reimbursement</header>
<subsection id="HE4A28EAEACEF444B865B7B6A3404F4B2"><enum>(a)</enum><header>Pharmacy reimbursement limits</header>
<paragraph id="H000F701269A54F419F0E956C7EE091B6"><enum>(1)</enum><header>In general</header><text display-inline="yes-display-inline">Section 1927(e) of the Social Security Act (42 U.S.C. 1396r–8(e)) is amended—</text>
<subparagraph id="H30242497DC4B459B89B3314B018E70EA"><enum>(A)</enum><text>in paragraph (4), by striking ‘‘(or, effective January 1, 2007, two or more)’’; and</text> </subparagraph>
<subparagraph id="HA984AF3C9E0B4A6EB0360DE85C5E1315"><enum>(B)</enum><text>by striking paragraph (5) and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="H960775ACBE0144CD8CAF8557D5BC08BA" style="OLC">
<paragraph id="HAA9E0ABB16374E81927DE4921FF2839B"><enum>(5)</enum><header>Use of AMP in upper payment limits</header><text display-inline="yes-display-inline">The Secretary shall calculate the Federal upper reimbursement limit established under paragraph (4) as no less than 300 percent of the weighted average (determined on the basis of utilization) of the most recently reported monthly average manufacturer prices for pharmaceutically and therapeutically equivalent multiple source drug products that are available for purchase by retail community pharmacies on a nationwide basis. The Secretary shall implement a process using rolling averages to calculate average manufacturer prices. Such process shall be similar to the process used in determining the average sales price of a drug or biological under section 1847A(c)(5)(A).</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subparagraph></paragraph>
<paragraph id="H8FDD6B129DE2415B8CD3921C9EA415B7"><enum>(2)</enum><header>Definition of AMP</header><text display-inline="yes-display-inline">Section 1927(k)(1) of such Act (42 U.S.C. 1396r–8(k)(1)) is amended—</text>
<subparagraph id="HE1EA29DC95214A649604CE52B78611AC"><enum>(A)</enum><text>in subparagraph (A), by striking ‘‘by’’ and all that follows through the period and inserting <quote>by—</quote></text>
<quoted-block display-inline="no-display-inline" id="H1E80EBFA3F414722A19416DE8AB972B4" style="OLC">
<clause id="H76862F9F16D0430DB358308BA1822921"><enum>(i)</enum><text display-inline="yes-display-inline">wholesalers for drugs distributed to retail community pharmacies; and</text> </clause>
<clause id="HB1A4DFA4405647D89435566FC401121F"><enum>(ii)</enum><text>retail community pharmacies that purchase drugs directly from the manufacturer.</text> </clause><after-quoted-block>; </after-quoted-block></quoted-block> </subparagraph>
<subparagraph commented="no" id="H58EF5BEC95A64F059306889E100C5500"><enum>(B)</enum><text>by striking subparagraph (B) and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="H95FE80161C254BFDBBB06401FFA273B6" style="OLC">
<subparagraph commented="no" id="HA8CEDE0C44154C50AA0D0448EB9E58BA"><enum>(B)</enum><header>Exclusion of customary prompt pay discounts and other payments</header>
<clause commented="no" id="HA9F7902AAE69443AAB0983141B40CB1B"><enum>(i)</enum><header>In general</header><text display-inline="yes-display-inline">The average manufacturer price for a covered outpatient drug shall exclude—</text>
<subclause commented="no" id="HB9DC71D31EA74A5BB631556972D0BCDE"><enum>(I)</enum><text>customary prompt pay discounts extended to wholesalers;</text> </subclause>
<subclause commented="no" id="HD8160CE9FB9D4C0A93FE3EA258DE7B2F"><enum>(II)</enum><text>bona fide service fees paid by manufacturers to wholesalers or retail community pharmacies, including (but not limited to) distribution service fees, inventory management fees, product stocking allowances, and fees associated with administrative services agreements and patient care programs (such as medication compliance programs and patient education programs);</text> </subclause>
<subclause commented="no" id="HDC5AAECF41A5404CA112FF432F695D35"><enum>(III)</enum><text>reimbursement by manufacturers for recalled, damaged, expired, or otherwise unsalable returned goods, including (but not limited to) reimbursement for the cost of the goods and any reimbursement of costs associated with return goods handling and processing, reverse logistics, and drug destruction; and</text> </subclause>
<subclause commented="no" id="HD59B0928AD714C158BA59E8178E62A9A"><enum>(IV)</enum><text>payments received from, and rebates or discounts provided to, pharmacy benefit managers, managed care organizations, health maintenance organizations, insurers, hospitals, clinics, mail order pharmacies, long term care providers, manufacturers, or any other entity that does not conduct business as a wholesaler or a retail community pharmacy.</text> </subclause></clause>
<clause commented="no" id="HEE694AD3BA0F4B3FABD37CE4D59DF60F"><enum>(ii)</enum><header>Inclusion of other discounts and payments</header><text>Notwithstanding clause (i), any other discounts, rebates, payments, or other financial transactions that are received by, paid by, or passed through to, retail community pharmacies shall be included in the average manufacturer price for a covered outpatient drug.</text> </clause></subparagraph><after-quoted-block>; and</after-quoted-block></quoted-block> </subparagraph>
<subparagraph id="HC3BD4DA793C846BE9AD9F5EA964E3ACD"><enum>(C)</enum><text>in subparagraph (C), by striking <quote>the retail pharmacy class of trade</quote> and inserting <quote>retail community pharmacies</quote>.</text> </subparagraph></paragraph>
<paragraph id="H6FF8DFDF5BE5449DB5F351D2E53AEBC6"><enum>(3)</enum><header>Definition of a multiple source drug</header><text>Section 1927(k)(7) of such Act (42 U.S.C. 1396r–8(k)(7)) is amended—</text>
<subparagraph id="HBEE0891126184D45880BF1884C157752"><enum>(A)</enum><text>in subparagraph (A)(i)(III), by striking ‘‘the State’’ and inserting ‘‘the United States’’; and</text> </subparagraph>
<subparagraph id="H046538DE16364DCC958F0C409B03DB1D"><enum>(B)</enum><text>in subparagraph (C)—</text>
<clause id="H728B0554F58849E88355B59EFF8803EF"><enum>(i)</enum><text>in clause (i), by inserting ‘‘and’’ after the semicolon;</text> </clause>
<clause id="H8EB9305A7EE14CA689266C87C34A0BC0"><enum>(ii)</enum><text>in clause (ii), by striking ‘‘; and’’ and inserting a period; and</text> </clause>
<clause id="H73CD2EC28AD7440CA6C5A9208139EE44"><enum>(iii)</enum><text>by striking clause (iii).</text> </clause></subparagraph></paragraph>
<paragraph id="H09EAF50A5CBE4221A4981A4A13EB107D"><enum>(4)</enum><header>Definition of retail community pharmacy</header><text>Section 1927(k) of such Act (42 U.S.C. 1396r–8(k)) is amended by adding at the end the following new paragraphs:</text>
<quoted-block display-inline="no-display-inline" id="H72144FDBFEF34F6798C9E4F3B794B6E7" style="OLC">
<paragraph id="H20E0377E248F4038808DA6CF0CCA531C"><enum>(10)</enum><header>Retail community pharmacy</header><text display-inline="yes-display-inline">The term <term>retail community pharmacy</term> means an independent pharmacy, a chain pharmacy, a supermarket pharmacy, or a mass merchandiser pharmacy that is licensed as a pharmacy by the State and that dispenses medications to the general public at retail prices. Such term does not include a pharmacy that dispenses prescription medications to patients primarily through the mail, nursing home pharmacies, long-term care facility pharmacies, hospital pharmacies, clinics, charitable or not-for-profit pharmacies, government pharmacies, or pharmacy benefit managers.</text> </paragraph>
<paragraph id="H2DB667579314497BBFE0F29D9389097F"><enum>(11)</enum><header>Wholesaler</header><text>The term <term>wholesaler</term> means a drug wholesaler that is engaged in wholesale distribution of prescription drugs to retail community pharmacies, including (but not limited to) manufacturers, repackers, distributors, own-label distributors, private-label distributors, jobbers, brokers, warehouses (including manufacturer’s and distributor’s warehouses, chain drug warehouses, and wholesale drug warehouses) independent wholesale drug traders, and retail community pharmacies that conduct wholesale distributions.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></subsection></section>
<enum>III</enum><header>Prescription drug importation</header>
<section id="H11D90DBF4C884DA78988C024659AFCE9"><enum>301.</enum><header>Repeal of certain section regarding importation of prescription drugs</header><text display-inline="no-display-inline">Chapter VIII of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 381 et seq.) is amended by striking section 804.</text> </section>
<section id="HA50336C646674A108A39C7BB9F1D35C8"><enum>302.</enum><header>Importation of prescription drugs; waiver of certain import restrictions</header>
<subsection id="H88646617B46D42B09E496647B0EB6B69"><enum>(a)</enum><header>In general</header><text>Chapter VIII of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 381 et seq.), as amended by section 301, is further amended by inserting after section 803 the following:</text>
<quoted-block act-name="Federal Food, Drug, and Cosmetic Act" id="H06E514A41B5647F4904AB1528EDB029E">
<section id="H1D7FA0735A704C4EAB72EAAFDAD216FB"><enum>804.</enum><header>Commercial and personal importation of prescription drugs</header>
<subsection id="H9222745C42344380853BB23366F624B4"><enum>(a)</enum><header>Importation of prescription drugs</header>
<paragraph id="HBB783782EAC04999A06FF1B0BF1A1D1E"><enum>(1)</enum><header>In general</header><text>In the case of qualifying drugs imported or offered for import into the United States from registered exporters or by registered importers—</text>
<subparagraph id="HD6635F8C28D14788A84206833AB6FC85"><enum>(A)</enum><text>the limitation on importation that is established in section 801(d)(1) is waived; and</text> </subparagraph>
<subparagraph id="H72B5C577A1A14138917E21558ABE2E9B"><enum>(B)</enum><text>the standards referred to in section 801(a) regarding admission of the drugs are subject to subsection (g) of this section (including with respect to qualifying drugs to which section 801(d)(1) does not apply).</text> </subparagraph></paragraph>
<paragraph id="HA08BCB38675A485F96F49B9CB0F5D6A5"><enum>(2)</enum><header>Importers</header><text>A qualifying drug may not be imported under paragraph (1) unless—</text>
<subparagraph id="HF10E1A322A5049D883AE4CF9825AE4DD"><enum>(A)</enum><text>the drug is imported by a pharmacy, group of pharmacies, or a wholesaler that is a registered importer; or</text> </subparagraph>
<subparagraph id="HA56D928F76AA4A1C8021163FB8CE8DD5"><enum>(B)</enum><text>the drug is imported by an individual for personal use or for the use of a family member of the individual (not for resale) from a registered exporter.</text> </subparagraph></paragraph>
<paragraph id="HCBF6E0F7D389475A9F80AC2BB259EF0F"><enum>(3)</enum><header>Rule of construction</header><text>This section shall apply only with respect to a drug that is imported or offered for import into the United States—</text>
<subparagraph id="HC9E6D7FDF36145B6A8CFEB1AC93855B2"><enum>(A)</enum><text>by a registered importer; or</text> </subparagraph>
<subparagraph id="HE418A97CFA4B48F48D48BA626F10AED8"><enum>(B)</enum><text>from a registered exporter to an individual.</text> </subparagraph></paragraph>
<paragraph id="HD8CDBB8036934E529B44E97AE7F9272E"><enum>(4)</enum><header>Definitions</header>
<subparagraph id="HD5DAE89192B74E7AB4D3D312AD62EEC1"><enum>(A)</enum><header>Registered exporter; registered importer</header><text>For purposes of this section:</text>
<clause id="HE23BFE9BE4414DFBA2367A006B32CD8D"><enum>(i)</enum><text>The term <term>registered exporter</term> means an exporter for which a registration under subsection (b) has been approved and is in effect.</text> </clause>
<clause id="H3E33E38BC4434B1BBBADDAB7225848C7"><enum>(ii)</enum><text>The term <term>registered importer</term> means a pharmacy, group of pharmacies, or a wholesaler for which a registration under subsection (b) has been approved and is in effect.</text> </clause>
<clause id="HC916228DF3CE471ABC67647D71B8BD68"><enum>(iii)</enum><text>The term <term>registration condition</term> means a condition that must exist for a registration under subsection (b) to be approved.</text> </clause></subparagraph>
<subparagraph id="HC3CB559D594F4E8D8EDE44440E23FBCA"><enum>(B)</enum><header>Qualifying drug</header><text>For purposes of this section, the term <term>qualifying drug</term> means a drug for which there is a corresponding U.S. label drug.</text> </subparagraph>
<subparagraph id="HA08F637E975D4E828C5A60C20FFF82BD"><enum>(C)</enum><header>U.S. label drug</header><text>For purposes of this section, the term <term>U.S. label drug</term> means a prescription drug that—</text>
<clause id="HC93AADA4AEE749BCA431E7FED56B2223"><enum>(i)</enum><text>with respect to a qualifying drug, has the same active ingredient or ingredients, route of administration, dosage form, and strength as the qualifying drug;</text> </clause>
<clause id="HEF4D861B2C0C44B18875A836E828295D"><enum>(ii)</enum><text>with respect to the qualifying drug, is manufactured by or for the person that manufactures the qualifying drug;</text> </clause>
<clause id="H8B55A2B9AD894E3095C701C3B7BB26A2"><enum>(iii)</enum><text>is approved under section 505(c); and</text> </clause>
<clause id="H6D02EDAB06F14B359638CA0D3311DD09"><enum>(iv)</enum><text>is not—</text>
<subclause id="HA611669A2E2A48E0B5F59B716BB9C26A"><enum>(I)</enum><text>a controlled substance, as defined in section 102 of the <act-name parsable-cite="CSA">Controlled Substances Act</act-name> (21 U.S.C. 802);</text> </subclause>
<subclause id="H025B4AAD59DA46098DBA453C2DF2240F"><enum>(II)</enum><text>a biological product, as defined in section 351 of the <act-name parsable-cite="PHSA">Public Health Service Act</act-name> (42 U.S.C. 262), including—</text>
<item id="H4EFBD9F882E7474C857AB29C23D60BD5"><enum>(aa)</enum><text>a therapeutic DNA plasmid product;</text> </item>
<item id="H1D00D4C56D5B40CAB569CABA89682064"><enum>(bb)</enum><text>a therapeutic synthetic peptide product;</text> </item>
<item id="HCBC30E6CE197403492C77578D3A0EDC8"><enum>(cc)</enum><text>a monoclonal antibody product for in vivo use; and</text> </item>
<item id="HF51F179F44D84A1C9946E3218F46F33B"><enum>(dd)</enum><text>a therapeutic recombinant DNA-derived product;</text> </item></subclause>
<subclause id="HF97FD6AC1955464C806B6453B50FAD5C"><enum>(III)</enum><text>an infused drug, including a peritoneal dialysis solution;</text> </subclause>
<subclause id="H3CDA3F422EFC4EB0B645C6F06E72905F"><enum>(IV)</enum><text>an injected drug;</text> </subclause>
<subclause id="HDD099E6696E3402DA34A64D8FDBDF1AA"><enum>(V)</enum><text>a drug that is inhaled during surgery;</text> </subclause>
<subclause id="HDEBF2539206A4561A31BDFEABED568B5"><enum>(VI)</enum><text>a drug that is the listed drug referred to in 2 or more abbreviated new drug applications under which the drug is commercially marketed; or</text> </subclause>
<subclause id="HFCE1515FF1F946F5A01A46DCED0052D2"><enum>(VII)</enum><text>a sterile opthlamic drug intended for topical use on or in the eye.</text> </subclause></clause></subparagraph>
<subparagraph id="H0512E317DEA249D396810643DA70222E"><enum>(D)</enum><header>Other definitions</header><text>For purposes of this section:</text>
<clause id="HA5888625225941CF9E9807CDAF4359B5"><enum>(i)</enum>
<subclause commented="no" display-inline="yes-display-inline" id="H674C23CA5162400394C1B30CB85DE9B1"><enum>(I)</enum><text>The term <term>exporter</term> means a person that is in the business of exporting a drug to individuals in the United States from Canada or from a permitted country designated by the Secretary under subclause (II), or that, pursuant to submitting a registration under subsection (b), seeks to be in such business.</text> </subclause>
<subclause id="H1E819AD2A8DD4242B1F40008AAB26AFB" indent="up1"><enum>(II)</enum><text>The Secretary shall designate a permitted country under subparagraph (E) (other than Canada) as a country from which an exporter may export a drug to individuals in the United States if the Secretary determines that—</text>
<item id="HE866E057EA8B43729AF80C39C045334B"><enum>(aa)</enum><text>the country has statutory or regulatory standards that are equivalent to the standards in the United States and Canada with respect to—</text>
<subitem id="H424AF6DEA06D45C9A3213266B06A0C9A"><enum>(AA)</enum><text>the training of pharmacists;</text> </subitem>
<subitem id="H495AFF94F72D45F4BAF2E1A687F0ADC8"><enum>(BB)</enum><text>the practice of pharmacy; and</text> </subitem>
<subitem id="H6672FF3E2ABB47D19FEADD19BD374B69"><enum>(CC)</enum><text>the protection of the privacy of personal medical information; and</text> </subitem></item>
<item id="HA677066FB4D84AB087770FD4AD0CADA0"><enum>(bb)</enum><text>the importation of drugs to individuals in the United States from the country will not adversely affect public health.</text> </item></subclause></clause>
<clause id="H444E16B6F083411986FF66B527541E9B"><enum>(ii)</enum><text>The term <term>importer</term> means a pharmacy, a group of pharmacies, or a wholesaler that is in the business of importing a drug into the United States or that, pursuant to submitting a registration under subsection (b), seeks to be in such business.</text> </clause>
<clause id="H34A2E6EB8B7347B187FD6545AD0910E2"><enum>(iii)</enum><text>The term <term>pharmacist</term> means a person licensed by a State to practice pharmacy, including the dispensing and selling of prescription drugs.</text> </clause>
<clause id="H95526C3B7818484EB510DC97D2387D5B"><enum>(iv)</enum><text>The term <term>pharmacy</term> means a person that—</text>
<subclause id="H95581F7699F4488095EF2D073BB8E52D"><enum>(I)</enum><text>is licensed by a State to engage in the business of selling prescription drugs at retail; and</text> </subclause>
<subclause id="H1EE96973A6734225A4DDFEC7E828B022"><enum>(II)</enum><text>employs 1 or more pharmacists.</text> </subclause></clause>
<clause id="H1E6E8CCFB21E4221A68CB5FCDE465E1E"><enum>(v)</enum><text>The term <term>prescription drug</term> means a drug that is described in section 503(b)(1).</text> </clause>
<clause id="HC8337C84423445589943A42C50BB98FA"><enum>(vi)</enum><text>The term <term>wholesaler</term>—</text>
<subclause id="H4634ABBE5F95486FB9387A9990CB1CAD"><enum>(I)</enum><text>means a person licensed as a wholesaler or distributor of prescription drugs in the United States under section 503(e)(2)(A); and</text> </subclause>
<subclause id="HE0BA55FB9F844EE393F7ED13DF6A626E"><enum>(II)</enum><text>does not include a person authorized to import drugs under section 801(d)(1).</text> </subclause></clause></subparagraph>
<subparagraph id="HE12BD8C65CFE403A8FCBE44AA48302BC"><enum>(E)</enum><header>Permitted country</header><text>The term <term>permitted country</term> means—</text>
<clause id="H57305369DBFF4E18942A651BA00B7FCA"><enum>(i)</enum><text>Australia;</text> </clause>
<clause id="H0F4C42389A8D4E24ABD89E30B696DD09"><enum>(ii)</enum><text>Canada;</text> </clause>
<clause id="H7669E7271AD449E490584D1B14FFAEB8"><enum>(iii)</enum><text>a member country of the European Union, but does not include a member country with respect to which—</text>
<subclause id="HABDE681ED1AA4E94884003F908C98D03"><enum>(I)</enum><text>the country’s Annex to the Treaty of Accession to the European Union 2003 includes a transitional measure for the regulation of human pharmaceutical products that has not expired; or</text> </subclause>
<subclause id="H304D9AE4EF424673BC78894A986AE216"><enum>(II)</enum><text>the Secretary determines that the requirements described in subclauses (I) and (II) of clause (vii) will not be met by the date on which such transitional measure for the regulation of human pharmaceutical products expires;</text> </subclause></clause>
<clause id="HEF56FE29568E4E72803868ADC719B1B3"><enum>(iv)</enum><text>Japan;</text> </clause>
<clause id="H9F97C918741548F7A90B868063484B25"><enum>(v)</enum><text>New Zealand;</text> </clause>
<clause id="H551FBCB9DA1D431DA69CCB3FBD03DF60"><enum>(vi)</enum><text>Switzerland; and</text> </clause>
<clause id="H7B72152B8F3C4067B56B17474A16BA51"><enum>(vii)</enum><text>a country in which the Secretary determines the following requirements are met:</text>
<subclause id="HC6F4282863914A4CB1C1867B23258DB7"><enum>(I)</enum><text>The country has statutory or regulatory requirements—</text>
<item id="HBE4215AA26A642D2B8D27769E0758D59"><enum>(aa)</enum><text>that require the review of drugs for safety and effectiveness by an entity of the government of the country;</text> </item>
<item id="H2D5BEAA5B613435590E6DF7D2C60B82E"><enum>(bb)</enum><text>that authorize the approval of only those drugs that have been determined to be safe and effective by experts employed by or acting on behalf of such entity and qualified by scientific training and experience to evaluate the safety and effectiveness of drugs on the basis of adequate and well-controlled investigations, including clinical investigations, conducted by experts qualified by scientific training and experience to evaluate the safety and effectiveness of drugs;</text> </item>
<item id="H4272DB57DEA141A8A572F87C5D597C3B"><enum>(cc)</enum><text>that require the methods used in, and the facilities and controls used for the manufacture, processing, and packing of drugs in the country to be adequate to preserve their identity, quality, purity, and strength;</text> </item>
<item id="HAD06CDDF3B9A4402AA00F9E7BE4BC3C7"><enum>(dd)</enum><text>for the reporting of adverse reactions to drugs and procedures to withdraw approval and remove drugs found not to be safe or effective; and</text> </item>
<item id="H99947ED429654496A5FB99D7BEC0446A"><enum>(ee)</enum><text>that require the labeling and promotion of drugs to be in accordance with the approval of the drug.</text> </item></subclause>
<subclause id="H38D3FD7907824962ACC6AF559A89EDEF"><enum>(II)</enum><text>The valid marketing authorization system in the country is equivalent to the systems in the countries described in clauses (i) through (vi).</text> </subclause>
<subclause id="HB130BAF330BE478CAF3E41273CE0F85F"><enum>(III)</enum><text>The importation of drugs to the United States from the country will not adversely affect public health.</text> </subclause></clause></subparagraph></paragraph></subsection>
<subsection id="H7F9EC1E9991446C384E1F2B35D540093"><enum>(b)</enum><header>Registration of importers and exporters</header>
<paragraph id="H3D0CA35FAF054DF28BD1B6875B7D2FBF"><enum>(1)</enum><header>Registration of importers and exporters</header><text>A registration condition is that the importer or exporter involved (referred to in this subsection as a <quote>registrant</quote>) submits to the Secretary a registration containing the following:</text>
<subparagraph id="H52551E0AA8BC45AB964DF00CF494B4DE"><enum>(A)</enum>
<clause commented="no" display-inline="yes-display-inline" id="H211A0C2A4FC24C07AB1D9D3B4CB70BEC"><enum>(i)</enum><text>In the case of an exporter, the name of the exporter and an identification of all places of business of the exporter that relate to qualifying drugs, including each warehouse or other facility owned or controlled by, or operated for, the exporter.</text> </clause>
<clause id="HFC054FF86C644EC8AD0D420D2B325DB2" indent="up1"><enum>(ii)</enum><text>In the case of an importer, the name of the importer and an identification of the places of business of the importer at which the importer initially receives a qualifying drug after importation (which shall not exceed 3 places of business except by permission of the Secretary).</text> </clause></subparagraph>
<subparagraph id="HFE407D7A906440318A09F8D301D5EA6F"><enum>(B)</enum><text>Such information as the Secretary determines to be necessary to demonstrate that the registrant is in compliance with registration conditions under—</text>
<clause id="HE8A0A017CB8240359EF78D5D5AC4AD7E"><enum>(i)</enum><text>in the case of an importer, subsections (c), (d), (e), (g), and (j) (relating to the sources of imported qualifying drugs; the inspection of facilities of the importer; the payment of fees; compliance with the standards referred to in section 801(a); and maintenance of records and samples); or</text> </clause>
<clause id="H967CA552A4A94A28B3B58FD59ECAD7FA"><enum>(ii)</enum><text>in the case of an exporter, subsections (c), (d), (f), (g), (h), (i), and (j) (relating to the sources of exported qualifying drugs; the inspection of facilities of the exporter and the marking of compliant shipments; the payment of fees; and compliance with the standards referred to in section 801(a); being licensed as a pharmacist; conditions for individual importation; and maintenance of records and samples).</text> </clause></subparagraph>
<subparagraph id="H86263FA715F042CFB9903D5E2A988BD9"><enum>(C)</enum><text>An agreement by the registrant that the registrant will not under subsection (a) import or export any drug that is not a qualifying drug.</text> </subparagraph>
<subparagraph id="HA96918B6D4ED424DB5E4FBC26E790F18"><enum>(D)</enum><text>An agreement by the registrant to—</text>
<clause id="H667A19C466AC490C8853C2DAF533116C"><enum>(i)</enum><text>notify the Secretary of a recall or withdrawal of a qualifying drug distributed in a permitted country that the registrant has exported or imported, or intends to export or import, to the United States under subsection (a);</text> </clause>
<clause id="HC45C632144F24A89AB5DD3ACAB1D8BA8"><enum>(ii)</enum><text>provide for the return to the registrant of such drug; and</text> </clause>
<clause id="H5730B7A0742A432DA326BA465787858A"><enum>(iii)</enum><text>cease, or not begin, the exportation or importation of such drug unless the Secretary has notified the registrant that exportation or importation of such drug may proceed.</text> </clause></subparagraph>
<subparagraph id="HB00C843B11834BEB929BBE4DB975D590"><enum>(E)</enum><text>An agreement by the registrant to ensure and monitor compliance with each registration condition, to promptly correct any noncompliance with such a condition, and to promptly report to the Secretary any such noncompliance.</text> </subparagraph>
<subparagraph id="H949D3A11032041B1A3AEB98B71F05D4F"><enum>(F)</enum><text>A plan describing the manner in which the registrant will comply with the agreement under subparagraph (E).</text> </subparagraph>
<subparagraph id="HB8BE97AF877B46B19143C5BFB7058C4A"><enum>(G)</enum><text>An agreement by the registrant to enforce a contract under subsection (c)(3)(B) against a party in the chain of custody of a qualifying drug with respect to the authority of the Secretary under clauses (ii) and (iii) of that subsection.</text> </subparagraph>
<subparagraph id="H03CA1B327F41409A9C79FA6B997B07EF"><enum>(H)</enum><text>An agreement by the registrant to notify the Secretary not more than 30 days before the registrant intends to make the change, of—</text>
<clause id="H20372308D1284FFBBAB717F65E677D46"><enum>(i)</enum><text>any change that the registrant intends to make regarding information provided under subparagraph (A) or (B); and</text> </clause>
<clause id="H19B276D4018941F1804DF3B0182B31D6"><enum>(ii)</enum><text>any change that the registrant intends to make in the compliance plan under subparagraph (F).</text> </clause></subparagraph>
<subparagraph id="H23559E0598454142A3C4BFF74E081DE5"><enum>(I)</enum><text>In the case of an exporter:</text>
<clause id="H4F9D82C2F0DE4B5BAA0B3886B1EF6D94"><enum>(i)</enum><text>An agreement by the exporter that a qualifying drug will not under subsection (a) be exported to any individual not authorized pursuant to subsection (a)(2)(B) to be an importer of such drug.</text> </clause>
<clause id="H9D18FAE3A730488CA0B8600E6BAE8EC9"><enum>(ii)</enum><text>An agreement to post a bond, payable to the Treasury of the United States that is equal in value to the lesser of—</text>
<subclause id="H0C1450BD74E945888C69B262C08CF41E"><enum>(I)</enum><text>the value of drugs exported by the exporter to the United States in a typical 4-week period over the course of a year under this section; or</text> </subclause>
<subclause id="H222C6D30F5174025A8E9F3440710D102"><enum>(II)</enum><text>$1,000,000.</text> </subclause></clause>
<clause id="H8BB462EE9945497AB0E66BF21493173F"><enum>(iii)</enum><text>An agreement by the exporter to comply with applicable provisions of Canadian law, or the law of the permitted country designated under subsection (a)(4)(D)(i)(II) in which the exporter is located, that protect the privacy of personal information with respect to each individual importing a prescription drug from the exporter under subsection (a)(2)(B).</text> </clause>
<clause id="H58554E08E14F4E1EBD06F75A09742EBC"><enum>(iv)</enum><text>An agreement by the exporter to report to the Secretary—</text>
<subclause id="H6B48792B40B5467D88E4936866F6F593"><enum>(I)</enum><text>not later than August 1 of each fiscal year, the total price and the total volume of drugs exported to the United States by the exporter during the 6-month period from January 1 through June 30 of that year; and</text> </subclause>
<subclause id="HF4F136E92EA24397AFF23BD428523BDB"><enum>(II)</enum><text>not later than January 1 of each fiscal year, the total price and the total volume of drugs exported to the United States by the exporter during the previous fiscal year.</text> </subclause></clause></subparagraph>
<subparagraph id="H6285E16FEC6245B782FDDCB04042421A"><enum>(J)</enum><text>In the case of an importer, an agreement by the importer to report to the Secretary—</text>
<clause id="HC884D41F01FB42B5BC4A70D3435F42AF"><enum>(i)</enum><text>not later than August 1 of each fiscal year, the total price and the total volume of drugs imported to the United States by the importer during the 6-month period from January 1 through June 30 of that fiscal year; and</text> </clause>
<clause id="H12CBF873B0CD44E99D9141DCDBE89460"><enum>(ii)</enum><text>not later than January 1 of each fiscal year, the total price and the total volume of drugs imported to the United States by the importer during the previous fiscal year.</text> </clause></subparagraph>
<subparagraph id="H6C514C6EA3B54E5D9237A6217A0704C7"><enum>(K)</enum><text>Such other provisions as the Secretary may require by regulation to protect the public health while permitting—</text>
<clause id="HA171A7852A79450BA66976E5AEBD5F54"><enum>(i)</enum><text>the importation by pharmacies, groups of pharmacies, and wholesalers as registered importers of qualifying drugs under subsection (a); and</text> </clause>
<clause id="H5E02D535320A4928BC88A85362355161"><enum>(ii)</enum><text>importation by individuals of qualifying drugs under subsection (a).</text> </clause></subparagraph></paragraph>
<paragraph id="HD6273EC815D740FFA1CA6B9C1DAD46CE"><enum>(2)</enum><header>Approval or disapproval of registration</header>
<subparagraph id="HE9FB409C6A144318B58EBD0F7F71474B"><enum>(A)</enum><header>In general</header><text>Not later than 90 days after the date on which a registrant submits to the Secretary a registration under paragraph (1), the Secretary shall notify the registrant whether the registration is approved or is disapproved. The Secretary shall disapprove a registration if there is reason to believe that the registrant is not in compliance with one or more registration conditions, and shall notify the registrant of such reason. In the case of a disapproved registration, the Secretary shall subsequently notify the registrant that the registration is approved if the Secretary determines that the registrant is in compliance with such conditions.</text> </subparagraph>
<subparagraph id="H3EE7A75C69514301AE4163827740D92F"><enum>(B)</enum><header>Changes in registration information</header><text>Not later than 30 days after receiving a notice under paragraph (1)(H) from a registrant, the Secretary shall determine whether the change involved affects the approval of the registration of the registrant under paragraph (1), and shall inform the registrant of the determination.</text> </subparagraph></paragraph>
<paragraph id="H976EFBA95A7A4264AB0E4707DE0A09BC"><enum>(3)</enum><header>Publication of contact information for registered exporters</header><text>Through the Internet website of the Food and Drug Administration and a toll-free telephone number, the Secretary shall make readily available to the public a list of registered exporters, including contact information for the exporters. Promptly after the approval of a registration submitted under paragraph (1), the Secretary shall update the Internet website and the information provided through the toll-free telephone number accordingly.</text> </paragraph>
<paragraph id="H8DA1AD8ED1874720B1437297B9F6FB22"><enum>(4)</enum><header>Suspension and termination</header>
<subparagraph id="H184EC4952859497FBC1B96F0F6A87284"><enum>(A)</enum><header>Suspension</header><text>With respect to the effectiveness of a registration submitted under paragraph (1):</text>
<clause id="HE98ED0D1799C41E2B735B97DECA11803"><enum>(i)</enum><text>Subject to clause (ii), the Secretary may suspend the registration if the Secretary determines, after notice and opportunity for a hearing, that the registrant has failed to maintain substantial compliance with a registration condition.</text> </clause>
<clause id="H2C135AAD16764A1DA9DB22CA5CAEADDC"><enum>(ii)</enum><text>If the Secretary determines that, under color of the registration, the exporter has exported a drug or the importer has imported a drug that is not a qualifying drug, or a drug that does not comply with subsection (g)(2)(A) or (g)(4), or has exported a qualifying drug to an individual in violation of subsection (i)(2)(F), 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 registrant an opportunity for a hearing not later than 10 days after the date on which the registration is suspended.</text> </clause>
<clause id="HBEE8AC39497E4EF3BBDE32C74E2F4823"><enum>(iii)</enum><text>The Secretary may reinstate the registration, whether suspended under clause (i) or (ii), if the Secretary determines that the registrant has demonstrated that further violations of registration conditions will not occur.</text> </clause></subparagraph>
<subparagraph id="HB6403CA35D5544BDBB6E44345D0ECBA7"><enum>(B)</enum><header>Termination</header><text>The Secretary, after notice and opportunity for a hearing, may terminate the registration under paragraph (1) of a registrant if the Secretary determines that the registrant 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 registrant. 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 is terminated, any registration submitted under paragraph (1) by the registrant, or a person that is a partner in the export or import enterprise, or a principal officer in such enterprise, and any registration prepared with the assistance of the registrant or such a person, has no legal effect under this section.</text> </subparagraph></paragraph>
<paragraph id="H001FF6A710734948982529805D415541"><enum>(5)</enum><header>Default of bond</header><text>A bond required to be posted by an exporter under paragraph (1)(I)(ii) shall be defaulted and paid to the Treasury of the United States if, after opportunity for an informal hearing, the Secretary determines that the exporter has—</text>
<subparagraph id="H3E86AAE1F9FB4234AEE125B62A6B9ED5"><enum>(A)</enum><text>exported a drug to the United States that is not a qualifying drug or that is not in compliance with subsection (g)(2)(A), (g)(4), or (i); or</text> </subparagraph>
<subparagraph id="H8DF963D5C0CE4D38829FB1647EF77C2E"><enum>(B)</enum><text>failed to permit the Secretary to conduct an inspection described under subsection (d).</text> </subparagraph></paragraph></subsection>
<subsection id="HAF6DF218B66E449EA36C9D48687392E3"><enum>(c)</enum><header>Sources of qualifying drugs</header><text>A registration condition is that the exporter or importer involved agrees that a qualifying drug will under subsection (a) be exported or imported into the United States only if there is compliance with the following:</text>
<paragraph id="H322717AB3AA14DDC9D616AF04B33DE9C"><enum>(1)</enum><text>The drug was manufactured in an establishment—</text>
<subparagraph id="H4383888ECEDF4D4BA4FBF5D0D0DF0256"><enum>(A)</enum><text>required to register under subsection (h) or (i) of section 510; and</text> </subparagraph>
<subparagraph id="H81786374F4EE4809B6EC5C969F8FDD9D"><enum>(B)</enum>
<clause commented="no" display-inline="yes-display-inline" id="HD2E17B250ADF4C089094B34855A7BE04"><enum>(i)</enum><text>inspected by the Secretary; or</text> </clause>
<clause id="H77CD77766583418F8985027610875579" indent="up1"><enum>(ii)</enum><text>for which the Secretary has elected to rely on a satisfactory report of a good manufacturing practice inspection of the establishment from a permitted country whose regulatory system the Secretary recognizes as equivalent under a mutual recognition agreement, as provided for under section 510(i)(3), section 803, or part 26 of title 21, Code of Federal Regulations (or any corresponding successor rule or regulation).</text> </clause></subparagraph></paragraph>
<paragraph id="H5A58F5B485414A8CBE8D728FB251463D"><enum>(2)</enum><text>The establishment is located in any country, and the establishment manufactured the drug for distribution in the United States or for distribution in 1 or more of the permitted countries (without regard to whether in addition the drug is manufactured for distribution in a foreign country that is not a permitted country).</text> </paragraph>
<paragraph id="H3E1CD29B7E5B4714940AA21E8E9B5F83"><enum>(3)</enum><text>The exporter or importer obtained the drug—</text>
<subparagraph id="HD2F523D405004579BDE646D227A0A29F"><enum>(A)</enum><text>directly from the establishment; or</text> </subparagraph>
<subparagraph id="HD49C76EC53CC4F48B8D61A9ACA6554EC"><enum>(B)</enum><text>directly from an entity that, by contract with the exporter or importer—</text>
<clause id="H78C757BFA4D545E2B5A48632786401A9"><enum>(i)</enum><text>provides to the exporter or importer a statement (in such form and containing such information as the Secretary may require) that, for the chain of custody from the establishment, identifies each prior sale, purchase, or trade of the drug (including the date of the transaction and the names and addresses of all parties to the transaction);</text> </clause>
<clause id="H7CBE26A34ECC44D898ADCBD3E5FD4FD8"><enum>(ii)</enum><text>agrees to permit the Secretary to inspect such statements and related records to determine their accuracy;</text> </clause>
<clause id="HE60F5F636B344EF9B4D5596A13813C3C"><enum>(iii)</enum><text>agrees, with respect to the qualifying drugs involved, to permit the Secretary to inspect warehouses and other facilities, including records, of the entity for purposes of determining whether the facilities are in compliance with any standards under this Act that are applicable to facilities of that type in the United States; and</text> </clause>
<clause id="H11052F236DD04BC7ABD13D3C932B2E26"><enum>(iv)</enum><text>has ensured, through such contractual relationships as may be necessary, that the Secretary has the same authority regarding other parties in the chain of custody from the establishment that the Secretary has under clauses (ii) and (iii) regarding such entity.</text> </clause></subparagraph></paragraph>
<paragraph id="HAC15272E735941E6BBD401FC071D5F03"><enum>(4)</enum>
<subparagraph commented="no" display-inline="yes-display-inline" id="H664182926B80464085B8583E5FB5BB26"><enum>(A)</enum><text>The foreign country from which the importer will import the drug is a permitted country; or</text> </subparagraph>
<subparagraph id="HB7FBABAEE94C47DDB4EE884F71210A39" indent="up1"><enum>(B)</enum><text>The foreign country from which the exporter will export the drug is the permitted country in which the exporter is located.</text> </subparagraph></paragraph>
<paragraph id="HD8A44418E0A8489CAEC116DC12BAD455"><enum>(5)</enum><text>During any period in which the drug was not in the control of the manufacturer of the drug, the drug did not enter any country that is not a permitted country.</text> </paragraph>
<paragraph id="H35B2DEB09178442FBF1A6A6E213D5F11"><enum>(6)</enum><text>The exporter or importer retains a sample of each lot of the drug for testing by the Secretary.</text> </paragraph></subsection>
<subsection id="HF2070A3748F54C9480D4F7D402BB4D2F"><enum>(d)</enum><header>Inspection of facilities; marking of shipments</header>
<paragraph id="HA669488B86D744958B695D75F36989F5"><enum>(1)</enum><header>Inspection of facilities</header><text>A registration condition is that, for the purpose of assisting the Secretary in determining whether the exporter involved is in compliance with all other registration conditions—</text>
<subparagraph id="H00D2A3419987423FB497C9268BCD2251"><enum>(A)</enum><text>the exporter agrees to permit the Secretary—</text>
<clause id="HD7E4838536C748158ADA845084B6A1D8"><enum>(i)</enum><text>to conduct onsite inspections, including monitoring on a day-to-day basis, of places of business of the exporter that relate to qualifying drugs, including each warehouse or other facility owned or controlled by, or operated for, the exporter;</text> </clause>
<clause id="HC772B6DEC146475CAC65304264D8E3B1"><enum>(ii)</enum><text>to have access, including on a day-to-day basis, to—</text>
<subclause id="H475083EEE9C44877BDE0EDB02F43F1E0"><enum>(I)</enum><text>records of the exporter that relate to the export of such drugs, including financial records; and</text> </subclause>
<subclause id="HAD8788E6AE8D496F9D858F7B993D3874"><enum>(II)</enum><text>samples of such drugs;</text> </subclause></clause>
<clause id="HC3C64A77D456400EAD719607B9499744"><enum>(iii)</enum><text>to carry out the duties described in paragraph (3); and</text> </clause>
<clause id="H418E15B3903B4D7A885E56CD0FD2A6BE"><enum>(iv)</enum><text>to carry out any other functions determined by the Secretary to be necessary regarding the compliance of the exporter; and</text> </clause></subparagraph>
<subparagraph id="H4D498F1EEF604111A1D3CE875E76CD2E"><enum>(B)</enum><text>the Secretary has assigned 1 or more employees of the Secretary to carry out the functions described in this subsection for the Secretary randomly, but not less than 12 times annually, on the premises of places of businesses referred to in subparagraph (A)(i), and such an assignment remains in effect on a continuous basis.</text> </subparagraph></paragraph>
<paragraph id="HDFBC54CC26F44C4A872BC6ACB734AAB2"><enum>(2)</enum><header>Marking of compliant shipments</header><text>A registration condition is that the exporter involved agrees to affix to each shipping container of qualifying drugs exported under subsection (a) such markings as the Secretary determines to be necessary to identify the shipment as being in compliance with all registration conditions. Markings under the preceding sentence shall—</text>
<subparagraph id="H1EE651EEAC824ED098126A50BB07B6D3"><enum>(A)</enum><text>be designed to prevent affixation of the markings to any shipping container that is not authorized to bear the markings; and</text> </subparagraph>
<subparagraph id="H8F463338AE704A2F99991E8FF68B55EE"><enum>(B)</enum><text>include anticounterfeiting or track-and-trace technologies, taking into account the economic and technical feasibility of those technologies.</text> </subparagraph></paragraph>
<paragraph id="H3D2EFFCD38274FFDB1D3098BB66ADB34"><enum>(3)</enum><header>Certain duties relating to exporters</header><text>Duties of the Secretary with respect to an exporter include the following:</text>
<subparagraph id="H5117DB1961304CFE944CC3F385474EAE"><enum>(A)</enum><text>Inspecting, randomly, but not less than 12 times annually, the places of business of the exporter at which qualifying drugs are stored and from which qualifying drugs are shipped.</text> </subparagraph>
<subparagraph id="H0075E7C9E617474C914B94E86A87B5AB"><enum>(B)</enum><text>During the inspections under subparagraph (A), verifying the chain of custody of a statistically significant sample of qualifying drugs from the establishment in which the drug was manufactured to the exporter, which shall be accomplished or supplemented by the use of anticounterfeiting or track-and-trace technologies, taking into account the economic and technical feasibility of those technologies, except that a drug that lacks such technologies from the point of manufacture shall not for that reason be excluded from importation by an exporter.</text> </subparagraph>
<subparagraph id="HE21C3868D5DA4660AAF2E9E7240317E0"><enum>(C)</enum><text>Randomly reviewing records of exports to individuals for the purpose of determining whether the drugs are being imported by the individuals in accordance with the conditions under subsection (i). Such reviews shall be conducted in a manner that will result in a statistically significant determination of compliance with all such conditions.</text> </subparagraph>
<subparagraph id="HD8049078B9E14A27846E9AA65F5943A1"><enum>(D)</enum><text>Monitoring the affixing of markings under paragraph (2).</text> </subparagraph>
<subparagraph id="HCC260D1F2D0440DC9A121DCBAAAFC423"><enum>(E)</enum><text>Inspecting as the Secretary determines is necessary the warehouses and other facilities, including records, of other parties in the chain of custody of qualifying drugs.</text> </subparagraph>
<subparagraph id="HBD033C55835D4AEB88976A32230D97FA"><enum>(F)</enum><text>Determining whether the exporter is in compliance with all other registration conditions.</text> </subparagraph></paragraph>
<paragraph id="H6D602B7DEC434571A5FFA86452D1FDFC"><enum>(4)</enum><header>Prior notice of shipments</header><text>A registration condition is that, not less than 8 hours and not more than 5 days in advance of the time of the importation of a shipment of qualifying drugs, the importer involved agrees to submit to the Secretary a notice with respect to the shipment of drugs to be imported or offered for import into the United States under subsection (a). A notice under the preceding sentence shall include—</text>
<subparagraph id="H0D0878599D0F4B70B1C320DBF2B93133"><enum>(A)</enum><text>the name and complete contact information of the person submitting the notice;</text> </subparagraph>
<subparagraph id="HF666DA0DB78747ACACD8F4819D29DE24"><enum>(B)</enum><text>the name and complete contact information of the importer involved;</text> </subparagraph>
<subparagraph id="H93EFA97566F94448AF9B7EC6B46E57B9"><enum>(C)</enum><text>the identity of the drug, including the established name of the drug, the quantity of the drug, and the lot number assigned by the manufacturer;</text> </subparagraph>
<subparagraph id="H28FCCBF7B1CF4442B6AAEA623AF9F079"><enum>(D)</enum><text>the identity of the manufacturer of the drug, including the identity of the establishment at which the drug was manufactured;</text> </subparagraph>
<subparagraph id="H0D09E24407784189BAE36B8AA6F664EB"><enum>(E)</enum><text>the country from which the drug is shipped;</text> </subparagraph>
<subparagraph id="H7B904ACC512C468FACF820A8C74ACBF6"><enum>(F)</enum><text>the name and complete contact information for the shipper of the drug;</text> </subparagraph>
<subparagraph id="H379D5871B079482BA526CBA6765AE0A3"><enum>(G)</enum><text>anticipated arrival information, including the port of arrival and crossing location within that port, and the date and time;</text> </subparagraph>
<subparagraph id="H6CFE1CA533F44784B03C14F01F979E8B"><enum>(H)</enum><text>a summary of the chain of custody of the drug from the establishment in which the drug was manufactured to the importer;</text> </subparagraph>
<subparagraph id="H50C3B7409EC745EF94B492A7F11E77F6"><enum>(I)</enum><text>a declaration as to whether the Secretary has ordered that importation of the drug from the permitted country cease under subsection (g)(2) (C) or (D); and</text> </subparagraph>
<subparagraph id="HFDD629FFB3924225A200E23945CE0F8B"><enum>(J)</enum><text>such other information as the Secretary may require by regulation.</text> </subparagraph></paragraph>
<paragraph id="H5E8D2D54024C4167A23DCEBADAAA3CD4"><enum>(5)</enum><header>Marking of compliant shipments</header><text>A registration condition is that the importer involved agrees, before wholesale distribution (as defined in section 503(e)) of a qualifying drug that has been imported under subsection (a), to affix to each container of such drug such markings or other technology as the Secretary determines necessary to identify the shipment as being in compliance with all registration conditions, except that the markings or other technology shall not be required on a drug that bears comparable, compatible markings or technology from the manufacturer of the drug. Markings or other technology under the preceding sentence shall—</text>
<subparagraph id="HBB2A6405C72A4D688E06D778D4E5CE34"><enum>(A)</enum><text>be designed to prevent affixation of the markings or other technology to any container that is not authorized to bear the markings; and</text> </subparagraph>
<subparagraph id="HF698C58BF80345EA9538B1D6708DE098"><enum>(B)</enum><text>shall include anticounterfeiting or track-and-trace technologies, taking into account the economic and technical feasibility of such technologies.</text> </subparagraph></paragraph>
<paragraph id="H0CAA9C04618F4F8EA5CE343F2484BCAB"><enum>(6)</enum><header>Certain duties relating to importers</header><text>Duties of the Secretary with respect to an importer include the following:</text>
<subparagraph id="H97FAA898E1904B86A235CCE4FAB7F40B"><enum>(A)</enum><text>Inspecting, randomly, but not less than 12 times annually, the places of business of the importer at which a qualifying drug is initially received after importation.</text> </subparagraph>
<subparagraph id="HF3BC60431F04481393AE2840CDC5D27D"><enum>(B)</enum><text>During the inspections under subparagraph (A), verifying the chain of custody of a statistically significant sample of qualifying drugs from the establishment in which the drug was manufactured to the importer, which shall be accomplished or supplemented by the use of anticounterfeiting or track-and-trace technologies, taking into account the economic and technical feasibility of those technologies, except that a drug that lacks such technologies from the point of manufacture shall not for that reason be excluded from importation by an importer.</text> </subparagraph>
<subparagraph id="H0F75B2E049C34F51811A60F504EF998D"><enum>(C)</enum><text>Reviewing notices under paragraph (4).</text> </subparagraph>
<subparagraph id="H2F6040F3960549EB81BADF0BA11DC165"><enum>(D)</enum><text>Inspecting as the Secretary determines is necessary the warehouses and other facilities, including records of other parties in the chain of custody of qualifying drugs.</text> </subparagraph>
<subparagraph id="HC2AB3D9E5ADE4B3F8145CFF7251C972A"><enum>(E)</enum><text>Determining whether the importer is in compliance with all other registration conditions.</text> </subparagraph></paragraph></subsection>
<subsection id="H23395E1F31D64465B6AA9CDE8DFA899B"><enum>(e)</enum><header>Importer fees</header>
<paragraph id="H5CEF3D2C5AA249D39E3EDC7DB45E3DC5"><enum>(1)</enum><header>Registration fee</header><text>A registration condition is that the importer involved pays to the Secretary a fee of $10,000 due on the date on which the importer first submits the registration to the Secretary under subsection (b).</text> </paragraph>
<paragraph id="H56BA969118DA46B79351230C2CD46532"><enum>(2)</enum><header>Inspection fee</header><text>A registration condition is that the importer involved pays a fee to the Secretary in accordance with this subsection. Such fee shall be paid not later than October 1 and April 1 of each fiscal year in the amount provided for under paragraph (3).</text> </paragraph>
<paragraph id="HE4FFC76B8BA34924AF33C3D4D45F61CC"><enum>(3)</enum><header>Amount of inspection fee</header>
<subparagraph id="HCE59C7ECEA5F49A0B1AAF572DBF748D0"><enum>(A)</enum><header>Aggregate total of fees</header><text>Not later than 30 days before the start of each fiscal year, the Secretary, in consultation with the Secretary of Homeland Security and the Secretary of the Treasury, shall establish an aggregate total of fees to be collected under paragraph (2) for importers for that fiscal year that is sufficient, and not more than necessary, to pay the costs for that fiscal year of administering this section with respect to registered importers, including the costs associated with—</text>
<clause id="H8988274A2F544CB5827D2ED337E4A7B8"><enum>(i)</enum><text>inspecting the facilities of registered importers, and of other entities in the chain of custody of a qualifying drug as necessary, under subsection (d)(6);</text> </clause>
<clause id="H3D95D7297BEB487C962E5C4780369A57"><enum>(ii)</enum><text>developing, implementing, and operating under such subsection an electronic system for submission and review of the notices required under subsection (d)(4) with respect to shipments of qualifying drugs under subsection (a) to assess compliance with all registration conditions when such shipments are offered for import into the United States; and</text> </clause>
<clause id="HA04D878758EF496B9C0707CE3D53D06A"><enum>(iii)</enum><text>inspecting such shipments as necessary, when offered for import into the United States to determine if such a shipment should be refused admission under subsection (g)(5).</text> </clause></subparagraph>
<subparagraph id="H9D322446870146AF9A417D938958B9EF"><enum>(B)</enum><header>Limitation</header><text>Subject to subparagraph (C), the aggregate total of fees collected under paragraph (2) for a fiscal year shall not exceed 2.5 percent of the total price of qualifying drugs imported during that fiscal year into the United States by registered importers under subsection (a).</text> </subparagraph>
<subparagraph id="HBC22B9A06A684799BCE4F8E15ED7E165"><enum>(C)</enum><header>Total price of drugs</header>
<clause id="H92123C1C27514F6CB61FD631CB1D6749"><enum>(i)</enum><header>Estimate</header><text>For the purposes of complying with the limitation described in subparagraph (B) when establishing under subparagraph (A) the aggregate total of fees to be collected under paragraph (2) for a fiscal year, the Secretary shall estimate the total price of qualifying drugs imported into the United States by registered importers during that fiscal year by adding the total price of qualifying drugs imported by each registered importer during the 6-month period from January 1 through June 30 of the previous fiscal year, as reported to the Secretary by each registered importer under subsection (b)(1)(J).</text> </clause>
<clause id="H4321B49A9C374C4BB218D252EFD7862E"><enum>(ii)</enum><header>Calculation</header><text>Not later than March 1 of the fiscal year that follows the fiscal year for which the estimate under clause (i) is made, the Secretary shall calculate the total price of qualifying drugs imported into the United States by registered importers during that fiscal year by adding the total price of qualifying drugs imported by each registered importer during that fiscal year, as reported to the Secretary by each registered importer under subsection (b)(1)(J).</text> </clause>
<clause id="H7F8B7A6B631D40FFA0CDBD4A7B9BE333"><enum>(iii)</enum><header>Adjustment</header><text>If the total price of qualifying drugs imported into the United States by registered importers during a fiscal year as calculated under clause (ii) is less than the aggregate total of fees collected under paragraph (2) for that fiscal year, the Secretary shall provide for a pro-rata reduction in the fee due from each registered importer on April 1 of the subsequent fiscal year so that the limitation described in subparagraph (B) is observed.</text> </clause></subparagraph>
<subparagraph id="H26A4BDE137FC48AB92733294111A3471"><enum>(D)</enum><header>Individual importer fee</header><text>Subject to the limitation described in subparagraph (B), the fee under paragraph (2) to be paid on October 1 and April 1 by an importer shall be an amount that is proportional to a reasonable estimate by the Secretary of the semiannual share of the importer of the volume of qualifying drugs imported by importers under subsection (a).</text> </subparagraph></paragraph>
<paragraph id="H14D83CACD59B43E997FE700A0B4BC858"><enum>(4)</enum><header>Use of fees</header>
<subparagraph id="HDBCF671B92964634A729D16A523BCA76"><enum>(A)</enum><header>In general</header><text>Subject to appropriations Acts, fees collected by the Secretary under paragraphs (1) and (2) shall be credited to the appropriation account for salaries and expenses of the Food and Drug Administration until expended (without fiscal year limitation), and the Secretary may, in consultation with the Secretary of Homeland Security and the Secretary of the Treasury, transfer some proportion of such fees to the appropriation account for salaries and expenses of the Bureau of Customs and Border Protection until expended (without fiscal year limitation).</text> </subparagraph>
<subparagraph id="H0273AAAF884F4A21B4A1F85CDDA974F0"><enum>(B)</enum><header>Sole purpose</header><text>Fees collected by the Secretary under paragraphs (1) and (2) are only available to the Secretary and, if transferred, to the Secretary of Homeland Security, and are for the sole purpose of paying the costs referred to in paragraph (3)(A).</text> </subparagraph></paragraph>
<paragraph id="HF8D402789CB94193AE0CBB417594386F"><enum>(5)</enum><header>Collection of fees</header><text>In any case where the Secretary does not receive payment of a fee assessed under paragraph (1) or (2) within 30 days after it is due, such fee shall be treated as a claim of the United States Government subject to subchapter II of chapter 37 of title 31, United States Code.</text> </paragraph></subsection>
<subsection id="H8ED61CBB7C5D49FA8A72CBCE57468738"><enum>(f)</enum><header>Exporter fees</header>
<paragraph id="H9F030D12E9E34FE28E921131E4784C29"><enum>(1)</enum><header>Registration fee</header><text>A registration condition is that the exporter involved pays to the Secretary a fee of $10,000 due on the date on which the exporter first submits that registration to the Secretary under subsection (b).</text> </paragraph>
<paragraph id="H3B32D8912B47481B8DC3E6DCD159027E"><enum>(2)</enum><header>Inspection fee</header><text>A registration condition is that the exporter involved pays a fee to the Secretary in accordance with this subsection. Such fee shall be paid not later than October 1 and April 1 of each fiscal year in the amount provided for under paragraph (3).</text> </paragraph>
<paragraph id="H1F5F4AA053A843CF8E5147F09C983AD4"><enum>(3)</enum><header>Amount of inspection fee</header>
<subparagraph id="H2EE29B733D2449AD9BF56B81BE7C0713"><enum>(A)</enum><header>Aggregate total of fees</header><text>Not later than 30 days before the start of each fiscal year, the Secretary, in consultation with the Secretary of Homeland Security and the Secretary of the Treasury, shall establish an aggregate total of fees to be collected under paragraph (2) for exporters for that fiscal year that is sufficient, and not more than necessary, to pay the costs for that fiscal year of administering this section with respect to registered exporters, including the costs associated with—</text>
<clause id="HDE4E95AEEA9D4E9DB8890D8478095CBE"><enum>(i)</enum><text>inspecting the facilities of registered exporters, and of other entities in the chain of custody of a qualifying drug as necessary, under subsection (d)(3);</text> </clause>
<clause id="H636ADF8DF6A6437983208495E4EE44AE"><enum>(ii)</enum><text>developing, implementing, and operating under such subsection a system to screen marks on shipments of qualifying drugs under subsection (a) that indicate compliance with all registration conditions, when such shipments are offered for import into the United States; and</text> </clause>
<clause id="H44310615C6274C6ABC8C8E71D0CD75AE"><enum>(iii)</enum><text>screening such markings, and inspecting such shipments as necessary, when offered for import into the United States to determine if such a shipment should be refused admission under subsection (g)(5).</text> </clause></subparagraph>
<subparagraph id="H7ECFBD8BBAFF427B8EF222A491A0249D"><enum>(B)</enum><header>Limitation</header><text>Subject to subparagraph (C), the aggregate total of fees collected under paragraph (2) for a fiscal year shall not exceed 2.5 percent of the total price of qualifying drugs imported during that fiscal year into the United States by registered exporters under subsection (a).</text> </subparagraph>
<subparagraph id="HD41F2E1F86E74A45ABD85B64FF1C25E4"><enum>(C)</enum><header>Total price of drugs</header>
<clause id="H3131B11F1A5341C19B1315F0E8638B4E"><enum>(i)</enum><header>Estimate</header><text>For the purposes of complying with the limitation described in subparagraph (B) when establishing under subparagraph (A) the aggregate total of fees to be collected under paragraph (2) for a fiscal year, the Secretary shall estimate the total price of qualifying drugs imported into the United States by registered exporters during that fiscal year by adding the total price of qualifying drugs exported by each registered exporter during the 6-month period from January 1 through June 30 of the previous fiscal year, as reported to the Secretary by each registered exporter under subsection (b)(1)(I)(iv).</text> </clause>
<clause id="H8857F440327C4996A9244AB976D73DEE"><enum>(ii)</enum><header>Calculation</header><text>Not later than March 1 of the fiscal year that follows the fiscal year for which the estimate under clause (i) is made, the Secretary shall calculate the total price of qualifying drugs imported into the United States by registered exporters during that fiscal year by adding the total price of qualifying drugs exported by each registered exporter during that fiscal year, as reported to the Secretary by each registered exporter under subsection (b)(1)(I)(iv).</text> </clause>
<clause id="H78F06C3555424B6D9FA0EB9F6312168A"><enum>(iii)</enum><header>Adjustment</header><text>If the total price of qualifying drugs imported into the United States by registered exporters during a fiscal year as calculated under clause (ii) is less than the aggregate total of fees collected under paragraph (2) for that fiscal year, the Secretary shall provide for a pro-rata reduction in the fee due from each registered exporter on April 1 of the subsequent fiscal year so that the limitation described in subparagraph (B) is observed.</text> </clause></subparagraph>
<subparagraph id="H788E39BE940544FC9DF59FF63147509C"><enum>(D)</enum><header>Individual exporter fee</header><text>Subject to the limitation described in subparagraph (B), the fee under paragraph (2) to be paid on October 1 and April 1 by an exporter shall be an amount that is proportional to a reasonable estimate by the Secretary of the semiannual share of the exporter of the volume of qualifying drugs exported by exporters under subsection (a).</text> </subparagraph></paragraph>
<paragraph id="H8ADBC29E53734CE0A6C5F66AB0201C52"><enum>(4)</enum><header>Use of fees</header>
<subparagraph id="HA45ADF5DF4F94E71B5FC56C01445FBEA"><enum>(A)</enum><header>In general</header><text>Subject to appropriations Acts, fees collected by the Secretary under paragraphs (1) and (2) shall be credited to the appropriation account for salaries and expenses of the Food and Drug Administration until expended (without fiscal year limitation), and the Secretary may, in consultation with the Secretary of Homeland Security and the Secretary of the Treasury, transfer some proportion of such fees to the appropriation account for salaries and expenses of the Bureau of Customs and Border Protection until expended (without fiscal year limitation).</text> </subparagraph>
<subparagraph id="H99B931EAD1994EE2B735BB29A1F60D36"><enum>(B)</enum><header>Sole purpose</header><text>Fees collected by the Secretary under paragraphs (1) and (2) are only available to the Secretary and, if transferred, to the Secretary of Homeland Security, and are for the sole purpose of paying the costs referred to in paragraph (3)(A).</text> </subparagraph></paragraph>
<paragraph id="HDBC0DFE8A3CC4E9ABCB33090AFF93EB5"><enum>(5)</enum><header>Collection of fees</header><text>In any case where the Secretary does not receive payment of a fee assessed under paragraph (1) or (2) within 30 days after it is due, such fee shall be treated as a claim of the United States Government subject to subchapter II of chapter 37 of title 31, United States Code.</text> </paragraph></subsection>
<subsection id="H0AA7C67CE45D4C4FBF749F01B40CD3B0"><enum>(g)</enum><header>Compliance with Section <enum-in-header>801(a)</enum-in-header></header>
<paragraph id="H128E5D3BD8174BA9A19EAE7878DCA7E9"><enum>(1)</enum><header>In general</header><text>A registration condition is that each qualifying drug exported under subsection (a) by the registered exporter involved or imported under subsection (a) by the registered importer involved is in compliance with the standards referred to in section 801(a) regarding admission of the drug into the United States, subject to paragraphs (2), (3), and (4).</text> </paragraph>
<paragraph id="HD86EA5FD87AD48B5BD96A3B884C6CA15"><enum>(2)</enum><header>Section 505; approval status</header>
<subparagraph id="H6B8EBCCE4C0F4D648E724B6BA34FEAA2"><enum>(A)</enum><header>In general</header><text>A qualifying drug that is imported or offered for import under subsection (a) shall comply with the conditions established in the approved application under section 505(b) for the U.S. label drug as described under this subsection.</text> </subparagraph>
<subparagraph id="H7786599CF292401CACD93F690FD8CF75"><enum>(B)</enum><header>Notice by manufacturer; general provisions</header>
<clause id="H15DF1A9FDA6A44A2B836575B637783A9"><enum>(i)</enum><header>In general</header><text>The person that manufactures a qualifying drug that is, or will be, introduced for commercial distribution in a permitted country shall in accordance with this paragraph submit to the Secretary a notice that—</text>
<subclause id="HD6449363340A43B2A956B35815EDFFE1"><enum>(I)</enum><text>includes each difference in the qualifying drug from a condition established in the approved application for the U.S. label drug beyond—</text>
<item id="H6B8D575CB9464D09A14E4CD81BEFCCF4"><enum>(aa)</enum><text>the variations provided for in the application; and</text> </item>
<item id="HB62E074964C6459D89E3A672CF38B6DD"><enum>(bb)</enum><text>any difference in labeling (except ingredient labeling); or</text> </item></subclause>
<subclause id="H320F25E5893E42EEBF57DF94AFF488DE"><enum>(II)</enum><text>states that there is no difference in the qualifying drug from a condition established in the approved application for the U.S. label drug beyond—</text>
<item id="H030A33D5119245E9A0FA5439DC96A25C"><enum>(aa)</enum><text>the variations provided for in the application; and</text> </item>
<item id="HE7E419BEFFB4473A81618218484F750F"><enum>(bb)</enum><text>any difference in labeling (except ingredient labeling).</text> </item></subclause></clause>
<clause id="H181D4968D9924B6C89A1DFE4639A63B7"><enum>(ii)</enum><header>Information in notice</header><text>A notice under clause (i)(I) shall include the information that the Secretary may require under section 506A, any additional information the Secretary may require (which may include data on bioequivalence if such data are not required under section 506A), and, with respect to the permitted country that approved the qualifying drug for commercial distribution, or with respect to which such approval is sought, include the following:</text>
<subclause id="H308A308147AA414399D859E9C780B0D1"><enum>(I)</enum><text>The date on which the qualifying drug with such difference was, or will be, introduced for commercial distribution in the permitted country.</text> </subclause>
<subclause id="H8CFD36B21E9D4DF3B0B9A751E348B781"><enum>(II)</enum><text>Information demonstrating that the person submitting the notice has also notified the government of the permitted country in writing that the person is submitting to the Secretary a notice under clause (i)(I), which notice describes the difference in the qualifying drug from a condition established in the approved application for the U.S. label drug.</text> </subclause>
<subclause id="HE3090B9FF35E4858AD39BF8FBC292968"><enum>(III)</enum><text>The information that the person submitted or will submit to the government of the permitted country for purposes of obtaining approval for commercial distribution of the drug in the country which, if in a language other than English, shall be accompanied by an English translation verified to be complete and accurate, with the name, address, and a brief statement of the qualifications of the person that made the translation.</text> </subclause></clause>
<clause id="HC107ED7A3FB0433284A78990BB2A9FAA"><enum>(iii)</enum><header>Certifications</header><text>The chief executive officer and the chief medical officer of the manufacturer involved shall each certify in the notice under clause (i) that—</text>
<subclause id="H62CDC33782A2498EB917D1871A3A55AD"><enum>(I)</enum><text>the information provided in the notice is complete and true; and</text> </subclause>
<subclause id="H32FA96995B97487FAD60CB1EDBAF0E7B"><enum>(II)</enum><text>a copy of the notice has been provided to the Federal Trade Commission and to the State attorneys general.</text> </subclause></clause>
<clause id="HFAC5B51926BF4DF39505BF1362FA0ED7"><enum>(iv)</enum><header>Fee</header><text>If a notice submitted under clause (i) includes a difference that would, under section 506A, require the submission of a supplemental application if made as a change to the U.S. label drug, the person that submits the notice shall pay to the Secretary a fee in the same amount as would apply if the person were paying a fee pursuant to section 736(a)(1)(A)(ii). Subject to appropriations Acts, fees collected by the Secretary under the preceding sentence are available only to the Secretary and are for the sole purpose of paying the costs of reviewing notices submitted under clause (i).</text> </clause>
<clause id="H83889B049482469ABC571ECD68555FC0"><enum>(v)</enum><header>Timing of submission of notices</header>
<subclause id="H801A87BCE1A5450B9144421B700224CC"><enum>(I)</enum><header>Prior approval notices</header><text>A notice under clause (i) to which subparagraph (C) applies shall be submitted to the Secretary not later than 120 days before the qualifying drug with the difference is introduced for commercial distribution in a permitted country, unless the country requires that distribution of the qualifying drug with the difference begin less than 120 days after the country requires the difference.</text> </subclause>
<subclause id="HEBB979AC7EC64F0EB92B3C249FA17816"><enum>(II)</enum><header>Other approval notices</header><text>A notice under clause (i) to which subparagraph (D) applies shall be submitted to the Secretary not later than the day on which the qualifying drug with the difference is introduced for commercial distribution in a permitted country.</text> </subclause>
<subclause id="HBEC7A1DF1F924D50A7D8BE7828F7A199"><enum>(III)</enum><header>Other notices</header><text>A notice under clause (i) to which subparagraph (E) applies shall be submitted to the Secretary on the date that the qualifying drug is first introduced for commercial distribution in a permitted country and annually thereafter.</text> </subclause></clause>
<clause id="HDF9354920D57411DB8E26E9559D8D834"><enum>(vi)</enum><header>Review by Secretary</header>
<subclause id="H34D996844D824E469EECDF3245AE865E"><enum>(I)</enum><header>In general</header><text>In this paragraph, the difference in a qualifying drug that is submitted in a notice under clause (i) from the U.S. label drug shall be treated by the Secretary as if it were a manufacturing change to the U.S. label drug under section 506A.</text> </subclause>
<subclause id="HB1F1B6E42276435686B89ABE2C753932"><enum>(II)</enum><header>Standard of review</header><text>Except as provided in subclause (III), the Secretary shall review and approve or disapprove the difference in a notice submitted under clause (i), if required under section 506A, using the safe and effective standard for approving or disapproving a manufacturing change under section 506A.</text> </subclause>
<subclause id="HAD073C2FF7C44D669BE30B93A51ED0B2"><enum>(III)</enum><header>Bioequivalence</header><text>If the Secretary would approve the difference in a notice submitted under clause (i) using the safe and effective standard under section 506A and if the Secretary determines that the qualifying drug is not bioequivalent to the U.S. label drug, the Secretary shall—</text>
<item id="H03D0CCC63F7B4EE5B5BD1141B04E9E92"><enum>(aa)</enum><text>include in the labeling provided under paragraph (3) a prominent advisory that the qualifying drug is safe and effective but is not bioequivalent to the U.S. label drug if the Secretary determines that such an advisory is necessary for health care practitioners and patients to use the qualifying drug safely and effectively; or</text> </item>
<item id="H8FC03BD460FB4399B9964D733ABD5439"><enum>(bb)</enum><text>decline to approve the difference if the Secretary determines that the availability of both the qualifying drug and the U.S. label drug would pose a threat to the public health.</text> </item></subclause>
<subclause id="HB70AD1B4D0E0469FBF7C15D9272D4285"><enum>(IV)</enum><header>Review by the Secretary</header><text>The Secretary shall review and approve or disapprove the difference in a notice submitted under clause (i), if required under section 506A, not later than 120 days after the date on which the notice is submitted.</text> </subclause>
<subclause id="H517E3659828140C894BB8C53A1BD9204"><enum>(V)</enum><header>Establishment inspection</header><text>If review of such difference would require an inspection of the establishment in which the qualifying drug is manufactured—</text>
<item id="H8AB6E9E08A7C4A99A92C7A04934E4595"><enum>(aa)</enum><text>such inspection by the Secretary shall be authorized; and</text> </item>
<item id="HFC631039505E4448923627BBA589A269"><enum>(bb)</enum><text>the Secretary may rely on a satisfactory report of a good manufacturing practice inspection of the establishment from a permitted country whose regulatory system the Secretary recognizes as equivalent under a mutual recognition agreement, as provided under section 510(i)(3), section 803, or part 26 of title 21, Code of Federal Regulations (or any corresponding successor rule or regulation).</text> </item></subclause></clause>
<clause id="H81F0A78272EB4C55A7E1ADEEEE0A582C"><enum>(vii)</enum><header>Publication of information on notices</header>
<subclause id="H05A8903B66E3497095CAFED469221426"><enum>(I)</enum><header>In general</header><text>Through the Internet website of the Food and Drug Administration and a toll-free telephone number, the Secretary shall readily make available to the public a list of notices submitted under clause (i).</text> </subclause>
<subclause id="H26DA572B21474A7EADE7AD69AD951B63"><enum>(II)</enum><header>Contents</header><text>The list under subclause (I) shall include the date on which a notice is submitted and whether—</text>
<item id="HFC2DFB176F584AF696B151E041A1532D"><enum>(aa)</enum><text>a notice is under review;</text> </item>
<item id="H502593E2E74B4755B5CB3303C1059F91"><enum>(bb)</enum><text>the Secretary has ordered that importation of the qualifying drug from a permitted country cease; or</text> </item>
<item id="HFEB2AB86557F4E899FCBBC9B49D77359"><enum>(cc)</enum><text>the importation of the drug is permitted under subsection (a).</text> </item></subclause>
<subclause id="H50E39E67E282489FA2ACEFC2B5008870"><enum>(III)</enum><header>Update</header><text>The Secretary shall promptly update the Internet website with any changes to the list.</text> </subclause></clause></subparagraph>
<subparagraph id="H8EC877A9B4C3423B98F14B6C5890EA2E"><enum>(C)</enum><header>Notice; drug difference requiring prior approval</header><text>In the case of a notice under subparagraph (B)(i) that includes a difference that would, under section 506A(c) or (d)(3)(B)(i), require the approval of a supplemental application before the difference could be made to the U.S. label drug the following shall occur:</text>
<clause id="H74D3AC45B5C5491D966A6964B1452662"><enum>(i)</enum><text>Promptly after the notice is submitted, the Secretary shall notify registered exporters, registered importers, the Federal Trade Commission, and the State attorneys general that the notice has been submitted with respect to the qualifying drug involved.</text> </clause>
<clause id="HDD3793B979A5459E90D79F34307CB3EF"><enum>(ii)</enum><text>If the Secretary has not made a determination whether such a supplemental application regarding the U.S. label drug would be approved or disapproved by the date on which the qualifying drug involved is to be introduced for commercial distribution in a permitted country, the Secretary shall—</text>
<subclause id="HEE6F5F0C19174E44B6BBC7145F1A4F9B"><enum>(I)</enum><text>order that the importation of the qualifying drug involved from the permitted country not begin until the Secretary completes review of the notice; and</text> </subclause>
<subclause id="HE0CA8E1D2ACA400AB39BE5838E7DD206"><enum>(II)</enum><text>promptly notify registered exporters, registered importers, the Federal Trade Commission, and the State attorneys general of the order.</text> </subclause></clause>
<clause id="H476134926F1F4ED3A58B75085547C3D5"><enum>(iii)</enum><text>If the Secretary determines that such a supplemental application regarding the U.S. label drug would not be approved, the Secretary shall—</text>
<subclause id="H99E1597C4FA24B47A81C643869B5AB6E"><enum>(I)</enum><text>order that the importation of the qualifying drug involved from the permitted country cease, or provide that an order under clause (ii), if any, remains in effect;</text> </subclause>
<subclause id="H063B8636F57F45DA962D913B56A14435"><enum>(II)</enum><text>notify the permitted country that approved the qualifying drug for commercial distribution of the determination; and</text> </subclause>
<subclause id="H1A0FDB2EBA2843F4B83828AF3FC6CA89"><enum>(III)</enum><text>promptly notify registered exporters, registered importers, the Federal Trade Commission, and the State attorneys general of the determination.</text> </subclause></clause>
<clause id="HDBD2A855B1434FCE9AAE4C0464954DD7"><enum>(iv)</enum><text>If the Secretary determines that such a supplemental application regarding the U.S. label drug would be approved, the Secretary shall—</text>
<subclause id="HCECC30DB270A4252A7DC8347B9647284"><enum>(I)</enum><text>vacate the order under clause (ii), if any;</text> </subclause>
<subclause id="H8C7C4EAA45CF4B8B85B7EE0EB9EB5FD1"><enum>(II)</enum><text>consider the difference to be a variation provided for in the approved application for the U.S. label drug;</text> </subclause>
<subclause id="H334DF4EE782E4C61B49DD763BB52EB73"><enum>(III)</enum><text>permit importation of the qualifying drug under subsection (a); and</text> </subclause>
<subclause id="H8635253BC6F14DCD9951B000405A2BEC"><enum>(IV)</enum><text>promptly notify registered exporters, registered importers, the Federal Trade Commission, and the State attorneys general of the determination.</text> </subclause></clause></subparagraph>
<subparagraph id="H681AA63BDD864A9E8ADC6ADEA0C486A0"><enum>(D)</enum><header>Notice; drug difference not requiring prior approval</header><text>In the case of a notice under subparagraph (B)(i) that includes a difference that would, under section 506A(d)(3)(B)(ii), not require the approval of a supplemental application before the difference could be made to the U.S. label drug the following shall occur:</text>
<clause id="H27537BC0FA9040D180D61F6A50314025"><enum>(i)</enum><text>During the period in which the notice is being reviewed by the Secretary, the authority under this subsection to import the qualifying drug involved continues in effect.</text> </clause>
<clause id="H907200EC36E8486A97F52DBA6E0B1531"><enum>(ii)</enum><text>If the Secretary determines that such a supplemental application regarding the U.S. label drug would not be approved, the Secretary shall—</text>
<subclause id="HBCC90C92E25148D497B6E96F6DC4D72D"><enum>(I)</enum><text>order that the importation of the qualifying drug involved from the permitted country cease;</text> </subclause>
<subclause id="H3BB095C9AD234A25ACD41D182D99DBBB"><enum>(II)</enum><text>notify the permitted country that approved the qualifying drug for commercial distribution of the determination; and</text> </subclause>
<subclause id="HF5DD9326BA414C679BFF41CD38111884"><enum>(III)</enum><text>promptly notify registered exporters, registered importers, the Federal Trade Commission, and the State attorneys general of the determination.</text> </subclause></clause>
<clause id="H4073C3BF5C2947249E943692172F7ADB"><enum>(iii)</enum><text>If the Secretary determines that such a supplemental application regarding the U.S. label drug would be approved, the difference shall be considered to be a variation provided for in the approved application for the U.S. label drug.</text> </clause></subparagraph>
<subparagraph id="HC4C184E4055549E2AA6E6E9DA0193F4B"><enum>(E)</enum><header>Notice; drug difference not requiring approval; no difference</header><text>In the case of a notice under subparagraph (B)(i) that includes a difference for which, under section 506A(d)(1)(A), a supplemental application would not be required for the difference to be made to the U.S. label drug, or that states that there is no difference, the Secretary—</text>
<clause id="H32A965F35E4246FEAC478CE630038799"><enum>(i)</enum><text>shall consider such difference to be a variation provided for in the approved application for the U.S. label drug;</text> </clause>
<clause id="HBE0CDC77322B4B848A4A88E7C539C846"><enum>(ii)</enum><text>may not order that the importation of the qualifying drug involved cease; and</text> </clause>
<clause id="H9A5E2C9FF49D4A62BEF6A7026C770203"><enum>(iii)</enum><text>shall promptly notify registered exporters and registered importers.</text> </clause></subparagraph>
<subparagraph id="HEA092668AAB54FE9B3BD23721252B934"><enum>(F)</enum><header>Differences in active ingredient, route of administration, dosage form, or strength</header>
<clause id="H5637EF91E3F9416096272C303BD26BF6"><enum>(i)</enum><header>In general</header><text>A person who manufactures a drug approved under section 505(b) shall submit an application under section 505(b) for approval of another drug that is manufactured for distribution in a permitted country by or for the person that manufactures the drug approved under section 505(b) if—</text>
<subclause id="H93C61CDDF1C84CC69F1A9D4BA3124AEB"><enum>(I)</enum><text>there is no qualifying drug in commercial distribution in permitted countries whose combined population represents at least 50 percent of the total population of all permitted countries with the same active ingredient or ingredients, route of administration, dosage form, and strength as the drug approved under section 505(b); and</text> </subclause>
<subclause id="H1D2A35445594468AA6CA5E73EA66280C"><enum>(II)</enum><text>each active ingredient of the other drug is related to an active ingredient of the drug approved under section 505(b), as defined in clause (v).</text> </subclause></clause>
<clause id="HA591A21DBF1646E799ED75169127D37B"><enum>(ii)</enum><header>Application under Section <enum-in-header>505(b)</enum-in-header></header><text>The application under section 505(b) required under clause (i) shall—</text>
<subclause id="H498DA0755DD2405381B2ACAE7AC83E5F"><enum>(I)</enum><text>request approval of the other drug for the indication or indications for which the drug approved under section 505(b) is labeled;</text> </subclause>
<subclause id="H742148D9603245F6B632418BA537A004"><enum>(II)</enum><text>include the information that the person submitted to the government of the permitted country for purposes of obtaining approval for commercial distribution of the other drug in that country, which if in a language other than English, shall be accompanied by an English translation verified to be complete and accurate, with the name, address, and a brief statement of the qualifications of the person that made the translation;</text> </subclause>
<subclause id="H41854977DBCA4B5297C2A3BCA5E4BDC0"><enum>(III)</enum><text>include a right of reference to the application for the drug approved under section 505(b); and</text> </subclause>
<subclause id="HA54CEF562775404A836FE8E3F1514C8A"><enum>(IV)</enum><text>include such additional information as the Secretary may require.</text> </subclause></clause>
<clause id="HC1FC77647FCF47739697A7B9E9F25E67"><enum>(iii)</enum><header>Timing of submission of application</header><text>An application under section 505(b) required under clause (i) shall be submitted to the Secretary not later than the day on which the information referred to in clause (ii)(II) is submitted to the government of the permitted country.</text> </clause>
<clause id="HC8C67DD69BC6460CAD9DEF1A1DC26883"><enum>(iv)</enum><header>Notice of decision on application</header><text>The Secretary shall promptly notify registered exporters, registered importers, the Federal Trade Commission, and the State attorneys general of a determination to approve or to disapprove an application under section 505(b) required under clause (i).</text> </clause>
<clause id="HD5BD2FD2B21C41EC881AC5C91F4C2018"><enum>(v)</enum><header>Related active ingredients</header><text>For purposes of clause (i)(II), 2 active ingredients are related if they are—</text>
<subclause id="HE1CF8AB935924C34A237E2B0245A5B05"><enum>(I)</enum><text>the same; or</text> </subclause>
<subclause id="H68714BB30F224F89A94E2BF23D8CC96E"><enum>(II)</enum><text>different salts, esters, or complexes of the same moiety.</text> </subclause></clause></subparagraph></paragraph>
<paragraph id="H9E811D2A5442462797EACDF3D41E0F6E"><enum>(3)</enum><header>Section 502; labeling</header>
<subparagraph id="HD8D93517FBFC48C0BE9151A1EB3C8DF6"><enum>(A)</enum><header>Importation by registered importer</header>
<clause id="H198267C52DD3454FAE14C0AED976C6CC"><enum>(i)</enum><header>In general</header><text>In the case of a qualifying drug that is imported or offered for import by a registered importer, such drug shall be considered to be in compliance with section 502 and the labeling requirements under the approved application for the U.S. label drug if the qualifying drug bears—</text>
<subclause id="H1336D34C06B0498F9FDC87009A342BEA"><enum>(I)</enum><text>a copy of the labeling approved for the U.S. label drug under section 505, without regard to whether the copy bears any trademark involved;</text> </subclause>
<subclause id="HAD559AC9DC1E4C28BA8EBC47CB106431"><enum>(II)</enum><text>the name of the manufacturer and location of the manufacturer;</text> </subclause>
<subclause id="HC68983B1BAC84257AD0249F80FF82A79"><enum>(III)</enum><text>the lot number assigned by the manufacturer;</text> </subclause>
<subclause id="HE509F7BC900A46EAB4D69412AA48CEBF"><enum>(IV)</enum><text>the name, location, and registration number of the importer; and</text> </subclause>
<subclause id="HAA72EAAABFE84899BD048133E653C36E"><enum>(V)</enum><text>the National Drug Code number assigned to the qualifying drug by the Secretary.</text> </subclause></clause>
<clause id="HDC331079FE4F4D72B3AA1196FFF4FDD7"><enum>(ii)</enum><header>Request for copy of the labeling</header><text>The Secretary shall provide such copy to the registered importer involved, upon request of the importer.</text> </clause>
<clause id="H5DC7FDAE56174363AA44B19B4C259F7A"><enum>(iii)</enum><header>Requested labeling</header><text>The labeling provided by the Secretary under clause (ii) shall—</text>
<subclause id="H66C4DE3D113F4452AB0D32FC9DAE8C37"><enum>(I)</enum><text>include the established name, as defined in section 502(e)(3), for each active ingredient in the qualifying drug;</text> </subclause>
<subclause id="HB754472FE8A643ADB453B0A870AE78B4"><enum>(II)</enum><text>not include the proprietary name of the U.S. label drug or any active ingredient thereof;</text> </subclause>
<subclause id="H7F858788ECAB418BA36C2ED8A49F9C5C"><enum>(III)</enum><text>if required under paragraph (2)(B)(vi)(III), a prominent advisory that the qualifying drug is safe and effective but not bioequivalent to the U.S. label drug; and</text> </subclause>
<subclause id="HD66DA6E32B674D6384CC2B6FD818B76C"><enum>(IV)</enum><text>if the inactive ingredients of the qualifying drug are different from the inactive ingredients for the U.S. label drug, include—</text>
<item id="HF52BFADA025F4D68B18AF056D1E99129"><enum>(aa)</enum><text>a prominent notice that the ingredients of the qualifying drug differ from the ingredients of the U.S. label drug and that the qualifying drug must be dispensed with an advisory to people with allergies about this difference and a list of ingredients; and</text> </item>
<item id="H309EDBE800394F5EA4679BA6C0084D0D"><enum>(bb)</enum><text>a list of the ingredients of the qualifying drug as would be required under section 502(e).</text> </item></subclause></clause></subparagraph>
<subparagraph id="HA3607F18667D4A918CBC4F04536BB77F"><enum>(B)</enum><header>Importation by individual</header>
<clause id="HA8C6FC23965A41F5AFAAFE9C130DF279"><enum>(i)</enum><header>In general</header><text>In the case of a qualifying drug that is imported or offered for import by a registered exporter to an individual, such drug shall be considered to be in compliance with section 502 and the labeling requirements under the approved application for the U.S. label drug if the packaging and labeling of the qualifying drug complies with all applicable regulations promulgated under sections 3 and 4 of the Poison Prevention Packaging Act of 1970 (15 U.S.C. 1471 et seq.) and the labeling of the qualifying drug includes—</text>
<subclause id="H538620F587D247B7995C7BC47D8066EC"><enum>(I)</enum><text>directions for use by the consumer;</text> </subclause>
<subclause id="HAFBDA3D5879A48568B00E15B71C8CE7F"><enum>(II)</enum><text>the lot number assigned by the manufacturer;</text> </subclause>
<subclause id="H55E5C8F6055B4669A213DF20D8AAB852"><enum>(III)</enum><text>the name and registration number of the exporter;</text> </subclause>
<subclause id="H2EFCC17A69AA4341864FEE53D3CC0297"><enum>(IV)</enum><text>if required under paragraph (2)(B)(vi)(III), a prominent advisory that the drug is safe and effective but not bioequivalent to the U.S. label drug;</text> </subclause>
<subclause id="H5FDCF314A613422AA2823ED2BED32C63"><enum>(V)</enum><text>if the inactive ingredients of the drug are different from the inactive ingredients for the U.S. label drug—</text>
<item id="H46559D12F5B44E88B4250971ABDF2932"><enum>(aa)</enum><text>a prominent advisory that persons with an allergy should check the ingredient list of the drug because the ingredients of the drug differ from the ingredients of the U.S. label drug; and</text> </item>
<item id="HF359655BEC384E8B8ED59CE0B7272A5B"><enum>(bb)</enum><text>a list of the ingredients of the drug as would be required under section 502(e); and</text> </item></subclause>
<subclause id="HA9FAA99080374408A6615CE9B9F494E8"><enum>(VI)</enum><text>a copy of any special labeling that would be required by the Secretary had the U.S. label drug been dispensed by a pharmacist in the United States, without regard to whether the special labeling bears any trademark involved.</text> </subclause></clause>
<clause id="H2382A5D8C5C948B6B78FDD1298F1093D"><enum>(ii)</enum><header>Packaging</header><text>A qualifying drug offered for import to an individual by an exporter under this section that is packaged in a unit-of-use container (as those items are defined in the United States Pharmacopeia and National Formulary) shall not be repackaged, provided that—</text>
<subclause id="HDB7D136488A24472A43E21712A094904"><enum>(I)</enum><text>the packaging complies with all applicable regulations under sections 3 and 4 of the Poison Prevention Packaging Act of 1970 (15 U.S.C. 1471 et seq.); or</text> </subclause>
<subclause id="H6DE34DA6D8E74F7C9C92F8DDBD3CB11B"><enum>(II)</enum><text>the consumer consents to waive the requirements of such Act, after being informed that the packaging does not comply with such Act and that the exporter will provide the drug in packaging that is compliant at no additional cost.</text> </subclause></clause>
<clause id="H5A91B4F7A2D5416589EB08D77FBC3803"><enum>(iii)</enum><header>Request for copy of special labeling and ingredient list</header><text>The Secretary shall provide to the registered exporter involved a copy of the special labeling, the advisory, and the ingredient list described under clause (i), upon request of the exporter.</text> </clause>
<clause id="H2E7ECEB4657241DB82B8D4F9F42A9876"><enum>(iv)</enum><header>Requested labeling and ingredient list</header><text>The labeling and ingredient list provided by the Secretary under clause (iii) shall—</text>
<subclause id="HA95B429B35874F3AB180C008DBDA671D"><enum>(I)</enum><text>include the established name, as defined in section 502(e)(3), for each active ingredient in the drug; and</text> </subclause>
<subclause id="H1FA41BC8FCCC4423B767110875A7A11E"><enum>(II)</enum><text>not include the proprietary name of the U.S. label drug or any active ingredient thereof.</text> </subclause></clause></subparagraph></paragraph>
<paragraph id="H32558FDA26A14C129608934F8E3A755D"><enum>(4)</enum><header>Section 501; adulteration</header><text>A qualifying drug that is imported or offered for import under subsection (a) shall be considered to be in compliance with section 501 if the drug is in compliance with subsection (c).</text> </paragraph>
<paragraph id="H44345E45019C48018533A916FAF83FB5"><enum>(5)</enum><header>Standards for refusing admission</header><text>A drug exported under subsection (a) from a registered exporter or imported by a registered importer may be refused admission into the United States if 1 or more of the following applies:</text>
<subparagraph id="HA250DB4FDE074591B69838DDA30DC421"><enum>(A)</enum><text>The drug is not a qualifying drug.</text> </subparagraph>
<subparagraph id="H9C90F8E643F44D08BBD306458E196CA5"><enum>(B)</enum><text>A notice for the drug required under paragraph (2)(B) has not been submitted to the Secretary.</text> </subparagraph>
<subparagraph id="H8C9DDA487CD24FDBAD8C7C24977AA09F"><enum>(C)</enum><text>The Secretary has ordered that importation of the drug from the permitted country cease under paragraph (2) (C) or (D).</text> </subparagraph>
<subparagraph id="HA97380AEB5D340BFB0CC3A95A9F857C9"><enum>(D)</enum><text>The drug does not comply with paragraph (3) or (4).</text> </subparagraph>
<subparagraph id="H0C50FD4AE6A742DA8A13998B9BF99EF7"><enum>(E)</enum><text>The shipping container appears damaged in a way that may affect the strength, quality, or purity of the drug.</text> </subparagraph>
<subparagraph id="H2250ABFC719748F4AF1D67C59607BE49"><enum>(F)</enum><text>The Secretary becomes aware that—</text>
<clause id="H353B8C0895DD4742AB0A67C974765E74"><enum>(i)</enum><text>the drug may be counterfeit;</text> </clause>
<clause id="H2E26C0D05E9744ACB57EA64B8EB183CC"><enum>(ii)</enum><text>the drug may have been prepared, packed, or held under insanitary conditions; or</text> </clause>
<clause id="H738F4A0AE7CF49399D81AB66AFF886FF"><enum>(iii)</enum><text>the methods used in, or the facilities or controls used for, the manufacturing, processing, packing, or holding of the drug do not conform to good manufacturing practice.</text> </clause></subparagraph>
<subparagraph id="H0BA211B442E14C64A58453DA79B6E15B"><enum>(G)</enum><text>The Secretary has obtained an injunction under section 302 that prohibits the distribution of the drug in interstate commerce.</text> </subparagraph>
<subparagraph id="H2412E6B8C33F4ED7AB6458C8B1629B62"><enum>(H)</enum><text>The Secretary has under section 505(e) withdrawn approval of the drug.</text> </subparagraph>
<subparagraph id="H454254F4F6FB4AD69325C8A5775E7132"><enum>(I)</enum><text>The manufacturer of the drug has instituted a recall of the drug.</text> </subparagraph>
<subparagraph id="H258D19028DFD4E76925851D3F17F62C0"><enum>(J)</enum><text>If the drug is imported or offered for import by a registered importer without submission of a notice in accordance with subsection (d)(4).</text> </subparagraph>
<subparagraph id="H1791D32D5FD84114ACB7E212DDFCF870"><enum>(K)</enum><text>If the drug is imported or offered for import from a registered exporter to an individual and 1 or more of the following applies:</text>
<clause id="HAF8D071B467C434CAE9B3C054CBE4BDF"><enum>(i)</enum><text>The shipping container for such drug does not bear the markings required under subsection (d)(2).</text> </clause>
<clause id="H46B62E00409B4817B026385006AF05DC"><enum>(ii)</enum><text>The markings on the shipping container appear to be counterfeit.</text> </clause>
<clause id="H30DD96F5715B4AA296F8A475A5E89550"><enum>(iii)</enum><text>The shipping container or markings appear to have been tampered with.</text> </clause></subparagraph></paragraph></subsection>
<subsection id="H4A27F24A425A4267A097E78CF0BFB92D"><enum>(h)</enum><header>Exporter licensure in permitted country</header><text>A registration condition is that the exporter involved agrees that a qualifying drug will be exported to an individual only if the Secretary has verified that—</text>
<paragraph id="HCD3562AF071D4AF2B267DDA82A5F4D4D"><enum>(1)</enum><text>the exporter is authorized under the law of the permitted country in which the exporter is located to dispense prescription drugs; and</text> </paragraph>
<paragraph id="HB7696383F7134383A03023F45C7AC429"><enum>(2)</enum><text>the exporter employs persons that are licensed under the law of the permitted country in which the exporter is located to dispense prescription drugs in sufficient number to dispense safely the drugs exported by the exporter to individuals, and the exporter assigns to those persons responsibility for dispensing such drugs to individuals.</text> </paragraph></subsection>
<subsection id="H518D1CA9163A41E89F2C59281C394FFB"><enum>(i)</enum><header>Individuals; conditions for importation</header>
<paragraph id="H35568772923249ABBF40971F138317CE"><enum>(1)</enum><header>In general</header><text>For purposes of subsection (a)(2)(B), the importation of a qualifying drug by an individual is in accordance with this subsection if the following conditions are met:</text>
<subparagraph id="HFBA84B80499E4051A41EC4720A2DC1BA"><enum>(A)</enum><text>The drug is accompanied by a copy of a prescription for the drug, which prescription—</text>
<clause id="H0EA33575649C4BC0877F44189A381DE2"><enum>(i)</enum><text>is valid under applicable Federal and State laws; and</text> </clause>
<clause id="H3481CAED50AF440A84AD6D41D10B968D"><enum>(ii)</enum><text>was issued by a practitioner who, under the law of a State of which the individual is a resident, or in which the individual receives care from the practitioner who issues the prescription, is authorized to administer prescription drugs.</text> </clause></subparagraph>
<subparagraph id="H130ACD43CB1B4383A37A567D264158A9"><enum>(B)</enum><text>The drug is accompanied by a copy of the documentation that was required under the law or regulations of the permitted country in which the exporter is located, as a condition of dispensing the drug to the individual.</text> </subparagraph>
<subparagraph id="H81BB385812404ADB94BD7B698E940BDD"><enum>(C)</enum><text>The copies referred to in subparagraphs (A)(i) and (B) are marked in a manner sufficient—</text>
<clause id="H5C7C8329968D41D498E73ECC0C946CDF"><enum>(i)</enum><text>to indicate that the prescription, and the equivalent document in the permitted country in which the exporter is located, have been filled; and</text> </clause>
<clause id="HC7A042D4BC544296AE38DFC1874D0DBA"><enum>(ii)</enum><text>to prevent a duplicative filling by another pharmacist.</text> </clause></subparagraph>
<subparagraph id="H8B76841982BA43EC9F70BE5C8A28106C"><enum>(D)</enum><text>The individual has provided to the registered exporter a complete list of all drugs used by the individual for review by the individuals who dispense the drug.</text> </subparagraph>
<subparagraph id="H47F12AA754294004BF7FE56C5C55921F"><enum>(E)</enum><text>The quantity of the drug does not exceed a 90-day supply.</text> </subparagraph>
<subparagraph id="H2CE04E9F1FB7405588BA16EDABE7BD9F"><enum>(F)</enum><text>The drug is not an ineligible subpart H drug. For purposes of this section, a prescription drug is an <quote>ineligible subpart H drug</quote> if the drug was approved by the Secretary under subpart H of part 314 of title 21, Code of Federal Regulations (relating to accelerated approval), with restrictions under section 520 of such part to assure safe use, and the Secretary has published in the Federal Register a notice that the Secretary has determined that good cause exists to prohibit the drug from being imported pursuant to this subsection.</text> </subparagraph></paragraph>
<paragraph id="H46AAED22048F4B8FA563804F9638A64F"><enum>(2)</enum><header>Notice regarding drug refused admission</header><text>If a registered exporter ships a drug to an individual pursuant to subsection (a)(2)(B) and the drug is refused admission to the United States, a written notice shall be sent to the individual and to the exporter that informs the individual and the exporter of such refusal and the reason for the refusal.</text> </paragraph></subsection>
<subsection id="H3C793A1CDDFD4001934B377F399011C4"><enum>(j)</enum><header>Maintenance of records and samples</header>
<paragraph id="HF7B0EC717F3B4AA0A6C4E0EA96DBF9E9"><enum>(1)</enum><header>In general</header><text>A registration condition is that the importer or exporter involved shall—</text>
<subparagraph id="H0FA0487B3AF5468F8F17B19AEDC36C4F"><enum>(A)</enum><text>maintain records required under this section for not less than 2 years; and</text> </subparagraph>
<subparagraph id="H3053BCDA34AE4F80AA1644754E8F927E"><enum>(B)</enum><text>maintain samples of each lot of a qualifying drug required under this section for not more than 2 years.</text> </subparagraph></paragraph>
<paragraph id="H68AE93A2E40B40789046543E8312B2DE"><enum>(2)</enum><header>Place of record maintenance</header><text>The records described under paragraph (1) shall be maintained—</text>
<subparagraph id="HE04E8B39426B42F98E4E957B6D15DEA1"><enum>(A)</enum><text>in the case of an importer, at the place of business of the importer at which the importer initially receives the qualifying drug after importation; or</text> </subparagraph>
<subparagraph id="H674DCF1B3CD94FC9AE5314858BD7FDEC"><enum>(B)</enum><text>in the case of an exporter, at the facility from which the exporter ships the qualifying drug to the United States.</text> </subparagraph></paragraph></subsection>
<subsection id="H398A0F74D8574BCC88BFE1041B0E1C91"><enum>(k)</enum><header>Drug recalls</header>
<paragraph id="HAACBD76908DD4B44B44EC219D01B8058"><enum>(1)</enum><header>Manufacturers</header><text>A person that manufactures a qualifying drug imported from a permitted country under this section shall promptly inform the Secretary—</text>
<subparagraph id="HD2094DCFBF60499C8CA23C1742EA72EF"><enum>(A)</enum><text>if the drug is recalled or withdrawn from the market in a permitted country;</text> </subparagraph>
<subparagraph id="H040D1C89FA7C4F5493BC10566311AD98"><enum>(B)</enum><text>how the drug may be identified, including lot number; and</text> </subparagraph>
<subparagraph id="H08848F4781B0485598D396F1B48F9173"><enum>(C)</enum><text>the reason for the recall or withdrawal.</text> </subparagraph></paragraph>
<paragraph id="HFA004B29A7154786B3BFFF6BA7913FD2"><enum>(2)</enum><header>Secretary</header><text>With respect to each permitted country, the Secretary shall—</text>
<subparagraph id="HDEB31D72EB574874B882E5E463DBAD49"><enum>(A)</enum><text>enter into an agreement with the government of the country to receive information about recalls and withdrawals of qualifying drugs in the country; or</text> </subparagraph>
<subparagraph id="HD83E9357D3BD4532A59002BA48EF2531"><enum>(B)</enum><text>monitor recalls and withdrawals of qualifying drugs in the country using any information that is available to the public in any media.</text> </subparagraph></paragraph>
<paragraph id="HA9A3B6E14A9D4FE5A09BFCF4DA579E07"><enum>(3)</enum><header>Notice</header><text>The Secretary may notify, as appropriate, registered exporters, registered importers, wholesalers, pharmacies, or the public of a recall or withdrawal of a qualifying drug in a permitted country.</text> </paragraph></subsection>
<subsection id="H9ACAB921C6294696B736137F9CF137CC"><enum>(l)</enum><header>Drug labeling and packaging</header>
<paragraph id="H76E0DA88DAE64857AF903EB2FF0AD2DB"><enum>(1)</enum><header>In general</header><text>When a qualifying drug that is imported into the United States by an importer under subsection (a) is dispensed by a pharmacist to an individual, the pharmacist shall provide that the packaging and labeling of the drug complies with all applicable regulations promulgated under sections 3 and 4 of the Poison Prevention Packaging Act of 1970 (15 U.S.C. 1471 et seq.) and shall include with any other labeling provided to the individual the following:</text>
<subparagraph id="H70A95BF9C98B407CB928C45F6E36241E"><enum>(A)</enum><text>The lot number assigned by the manufacturer.</text> </subparagraph>
<subparagraph id="H6690FFA2E4624C19BF07FC9A31D0112B"><enum>(B)</enum><text>The name and registration number of the importer.</text> </subparagraph>
<subparagraph id="H312BBD387E5049F080D58BE6910A1E93"><enum>(C)</enum><text>If required under paragraph (2)(B)(vi)(III) of subsection (g), a prominent advisory that the drug is safe and effective but not bioequivalent to the U.S. label drug.</text> </subparagraph>
<subparagraph id="HA2D25149FCBB49068AB1BA5FAD0C3896"><enum>(D)</enum><text>If the inactive ingredients of the drug are different from the inactive ingredients for the U.S. label drug—</text>
<clause id="HACE291A3CFBC47D9A69277CD5C118075"><enum>(i)</enum><text>a prominent advisory that persons with allergies should check the ingredient list of the drug because the ingredients of the drug differ from the ingredients of the U.S. label drug; and</text> </clause>
<clause id="H6CBBCB5A4C4B4720BC8A8DA5E0A5AE96"><enum>(ii)</enum><text>a list of the ingredients of the drug as would be required under section 502(e).</text> </clause></subparagraph></paragraph>
<paragraph id="HF6AD7E3FA62C455D8D27392205B715B5"><enum>(2)</enum><header>Packaging</header><text>A qualifying drug that is packaged in a unit-of-use container (as those terms are defined in the United States Pharmacopeia and National Formulary) shall not be repackaged, provided that—</text>
<subparagraph id="HDBA164765A084F85B264735A71B29928"><enum>(A)</enum><text>the packaging complies with all applicable regulations under sections 3 and 4 of the Poison Prevention Packaging Act of 1970 (15 U.S.C. 1471 et seq.); or</text> </subparagraph>
<subparagraph id="HBE621818CF7F4BFB889EE6A9862F5392"><enum>(B)</enum><text>the consumer consents to waive the requirements of such Act, after being informed that the packaging does not comply with such Act and that the pharmacist will provide the drug in packaging that is compliant at no additional cost.</text> </subparagraph></paragraph></subsection>
<subsection id="H2FFCB7040AF3485E86D31CCEF85A8310"><enum>(m)</enum><header>Charitable contributions</header><text>Notwithstanding any other provision of this section, this section does not authorize the importation into the United States of a qualifying drug donated or otherwise supplied for free or at nominal cost by the manufacturer of the drug to a charitable or humanitarian organization, including the United Nations and affiliates, or to a government of a foreign country.</text> </subsection>
<subsection id="H87E35C78754D429EB1E2C7C8D3E558F4"><enum>(n)</enum><header>Unfair and discriminatory Acts and practices</header>
<paragraph id="H9185FAA05B454A5F96487C5C5660CE23"><enum>(1)</enum><header>In general</header><text>It is unlawful for a manufacturer, directly or indirectly (including by being a party to a licensing agreement or other agreement), to—</text>
<subparagraph id="HC1C832EA8B0D47738DC07587EAD14FF6"><enum>(A)</enum><text>discriminate by charging a higher price for a prescription drug sold to a registered exporter or other person in a permitted country that exports a qualifying drug to the United States under this section than the price that is charged, inclusive of rebates or other incentives to the permitted country or other person, to another person that is in the same country and that does not export a qualifying drug into the United States under this section;</text> </subparagraph>
<subparagraph id="HFDAE77D3CCE047BBA83D40F028C4E51C"><enum>(B)</enum><text>discriminate by charging a higher price for a prescription drug sold to a registered importer or other person that distributes, sells, or uses a qualifying 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 qualifying drug under this section, or that does not distribute, sell, or use such a drug;</text> </subparagraph>
<subparagraph id="H45913E28A48A49DFBCA1AE99B2F15FE2"><enum>(C)</enum><text>discriminate by denying, restricting, or delaying supplies of a prescription drug to a registered exporter or other person in a permitted country that exports a qualifying drug to the United States under this section or to a registered importer or other person that distributes, sells, or uses a qualifying drug imported into the United States under this section;</text> </subparagraph>
<subparagraph id="HF1DE506DB81A42E7A2FDCD1D007F2232"><enum>(D)</enum><text>discriminate by publicly, privately, or otherwise refusing to do business with a registered exporter or other person in a permitted country that exports a qualifying drug to the United States under this section or with a registered importer or other person that distributes, sells, or uses a qualifying drug imported into the United States under this section;</text> </subparagraph>
<subparagraph id="HDFBE95E2E6EB42E98932006A898460B5"><enum>(E)</enum><text>knowingly fail to submit a notice under subsection (g)(2)(B)(i), knowingly fail to submit such a notice on or before the date specified in subsection (g)(2)(B)(v) or as otherwise required under subsection (e) (3), (4), and (5) of section 4 of the <short-title>Pharmaceutical Market Access and Drug Safety Act of 2009</short-title>, knowingly submit such a notice that makes a materially false, fictitious, or fraudulent statement, or knowingly fail to provide promptly any information requested by the Secretary to review such a notice;</text> </subparagraph>
<subparagraph id="HE897A8BD6A4944E6B9C9DE23B3FF51E5"><enum>(F)</enum><text>knowingly fail to submit an application required under subsection (g)(2)(F), knowingly fail to submit such an application on or before the date specified in subsection (g)(2)(F)(ii), knowingly submit such an application that makes a materially false, fictitious, or fraudulent statement, or knowingly fail to provide promptly any information requested by the Secretary to review such an application;</text> </subparagraph>
<subparagraph id="H7D37456EA3A24872ACADC3131BE6BD98"><enum>(G)</enum><text>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;</text> </subparagraph>
<subparagraph id="H0E1F223DACD04AF7B74C178E07350358"><enum>(H)</enum><text>refuse to allow an inspection authorized under this section of an establishment that manufactures a qualifying drug that is, or will be, introduced for commercial distribution in a permitted country;</text> </subparagraph>
<subparagraph id="HD6668848E0FB41FC9DCA2450EA1C7DE3"><enum>(I)</enum><text>fail to conform to the methods used in, or the facilities used for, the manufacturing, processing, packing, or holding of a qualifying drug that is, or will be, introduced for commercial distribution in a permitted country to good manufacturing practice under this Act;</text> </subparagraph>
<subparagraph id="H1A0F0F86CAFD49788296D14036122B18"><enum>(J)</enum><text>become a party to a licensing agreement or other agreement related to a qualifying drug that fails to provide for compliance with all requirements of this section with respect to such drug;</text> </subparagraph>
<subparagraph id="H014D7219DC0E4C1E88795367FD6658E4"><enum>(K)</enum><text>enter into a contract that restricts, prohibits, or delays the importation of a qualifying drug under this section;</text> </subparagraph>
<subparagraph id="HCDFFF5079EF1408E91F15972965F30D9"><enum>(L)</enum><text>engage in any other action to restrict, prohibit, or delay the importation of a qualifying drug under this section; or</text> </subparagraph>
<subparagraph id="H1ED1622F4AEF407F9022E7773FC13F23"><enum>(M)</enum><text>engage in any other action that the Federal Trade Commission determines to discriminate against a person that engages or attempts to engage in the importation of a qualifying drug under this section.</text> </subparagraph></paragraph>
<paragraph id="H7DC96D3E335E45359CFE60CFBC2CF8D6"><enum>(2)</enum><header>Referral of potential violations</header><text>The Secretary shall promptly refer to the Federal Trade Commission each potential violation of subparagraph (E), (F), (G), (H), or (I) of paragraph (1) that becomes known to the Secretary.</text> </paragraph>
<paragraph id="HC092BA10A6644F9D8680582A9D1778C8"><enum>(3)</enum><header>Affirmative defense</header>
<subparagraph id="HF99040F48E6C44AA8BE33790B7DA2387"><enum>(A)</enum><header>Discrimination</header><text>It shall be an affirmative defense to a charge that a manufacturer has discriminated under subparagraph (A), (B), (C), (D), or (M) of paragraph (1) that the higher price charged for a prescription drug sold to a person, the denial, restriction, or delay of supplies of a prescription drug to a person, the refusal to do business with a person, or other discriminatory activity against a person, is not based, in whole or in part, on—</text>
<clause id="HF428E4E331CE44C088624A818E3DAAD1"><enum>(i)</enum><text>the person exporting or importing a qualifying drug into the United States under this section; or</text> </clause>
<clause id="HED801627F5C04A80B5328555AB9A2DE9"><enum>(ii)</enum><text>the person distributing, selling, or using a qualifying drug imported into the United States under this section.</text> </clause></subparagraph>
<subparagraph id="H645C02BD3EC14770B5D499367457A482"><enum>(B)</enum><header>Drug differences</header><text>It shall be an affirmative defense to a charge that a manufacturer has caused there to be a difference described in subparagraph (G) of paragraph (1) that—</text>
<clause id="H3B84FDECC72F49DFB34BEE9933980444"><enum>(i)</enum><text>the difference was required by the country in which the drug is distributed;</text> </clause>
<clause id="H5A59ED283D154BF58C487F33347D2C0D"><enum>(ii)</enum><text>the Secretary has determined that the difference was necessary to improve the safety or effectiveness of the drug;</text> </clause>
<clause id="H1B8B97778FC743A38285A259F1A941C8"><enum>(iii)</enum><text>the person manufacturing the drug for distribution in the United States has given notice to the Secretary under subsection (g)(2)(B)(i) that the drug for distribution in the United States is not different from a drug for distribution in permitted countries whose combined population represents at least 50 percent of the total population of all permitted countries; or</text> </clause>
<clause id="HB9FD4C4371A94CCE8103A4F96DF9F3B0"><enum>(iv)</enum><text>the difference was not caused, in whole or in part, for the purpose of restricting importation of the drug into the United States under this section.</text> </clause></subparagraph></paragraph>
<paragraph id="H65829362CACC4C82BC65E2549E0E8804"><enum>(4)</enum><header>Effect of subsection</header>
<subparagraph id="H76BB45107DB54F039F804B690B7AA26F"><enum>(A)</enum><header>Sales in other countries</header><text>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.</text> </subparagraph>
<subparagraph id="H9AFFA2C01FB5474F85F92EEDC556407B"><enum>(B)</enum><header>Discounts to insurers, health plans, pharmacy benefit managers, and covered entities</header><text>Nothing in this subsection shall be construed to—</text>
<clause id="H561CFE7FC3514A76A4B756A1B163D102"><enum>(i)</enum><text>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 of the <act-name parsable-cite="PHSA">Public Health Service Act</act-name> (42 U.S.C. 256b) in return for inclusion of the drug on a formulary;</text> </clause>
<clause id="H3C5E4DDC25ED4909AA839BE0BE617725"><enum>(ii)</enum><text>require that such discounts be made available to other purchasers of the prescription drug; or</text> </clause>
<clause id="HC303A68E8F2B4E2A8E2A9292D6A3D3FD"><enum>(iii)</enum><text>prevent or restrict any other measures taken by an insurer, health plan, or pharmacy benefit manager to encourage consumption of such prescription drug.</text> </clause></subparagraph>
<subparagraph id="H929642FB35454CAAB6DFB13DA24FB622"><enum>(C)</enum><header>Charitable contributions</header><text>Nothing in this subsection shall be construed to—</text>
<clause id="H3A9E8952EA2448EB817D6A7AE3A4EDC7"><enum>(i)</enum><text>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</text> </clause>
<clause id="H4E8B9078920A4555AA77210129287753"><enum>(ii)</enum><text>apply to such donations or supplying of a prescription drug.</text> </clause></subparagraph></paragraph>
<paragraph id="H2AA047976ADA48728D3A503D9BEAF8DA"><enum>(5)</enum><header>Enforcement</header>
<subparagraph id="H2AFFBDE53FD64CEBABDED062F21B8493"><enum>(A)</enum><header>Unfair or deceptive Act or practice</header><text>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 <act-name parsable-cite="FTCA">Federal Trade Commission Act</act-name> (15 U.S.C. 57a(a)(1)(B)).</text> </subparagraph>
<subparagraph id="H7A11EABB72704B23A841954BF4376665"><enum>(B)</enum><header>Actions by the commission</header><text>The Federal Trade Commission—</text>
<clause id="H59784D2F5069421D980C5769ED59D5B0"><enum>(i)</enum><text>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 <act-name parsable-cite="FTCA">Federal Trade Commission Act</act-name> (15 U.S.C. 41 et seq.) were incorporated into and made a part of this section; and</text> </clause>
<clause id="H1B65E2189F9A40C5A848BB0B6A5A3D09"><enum>(ii)</enum><text>may seek monetary relief threefold the damages sustained, in addition to any other remedy available to the Federal Trade Commission under the <act-name parsable-cite="FTCA">Federal Trade Commission Act</act-name> (15 U.S.C. 41 et seq.).</text> </clause></subparagraph></paragraph>
<paragraph id="H10F8627EB0A54545A9E9AB2F9D50AA5A"><enum>(6)</enum><header>Actions by States</header>
<subparagraph id="H9022543D333E4B05BFB75EC7990A4152"><enum>(A)</enum><header>In general</header>
<clause id="H663D2142D60F4DADB136FF143063515D"><enum>(i)</enum><header>Civil actions</header><text>In any case in which the attorney general of a State has reason to believe that an interest of the residents of that State have been adversely affected by any manufacturer that violates paragraph (1), 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 to—</text>
<subclause id="HC72D3858F4924F699F62E3F68E5B184F"><enum>(I)</enum><text>enjoin that practice;</text> </subclause>
<subclause id="H731C306C872A4D34BF0C90219D7C7B06"><enum>(II)</enum><text>enforce compliance with this subsection;</text> </subclause>
<subclause id="HCDF351505EF34D8C8CFC2EA871A73D30"><enum>(III)</enum><text>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</text> </subclause>
<subclause id="H787970B786354EF5AA5B2D1AD095EB88"><enum>(IV)</enum><text>obtain such other relief as the court may consider to be appropriate.</text> </subclause></clause>
<clause id="H9468B46DA3C04ACC98C8145725BF5310"><enum>(ii)</enum><header>Notice</header>
<subclause id="H16A5A367DC004B1E97A4156EDFCC2D9E"><enum>(I)</enum><header>In general</header><text>Before filing an action under clause (i), the attorney general of the State involved shall provide to the Federal Trade Commission—</text>
<item id="HF35C46ED16554D5F8BDD7566429E4692"><enum>(aa)</enum><text>written notice of that action; and</text> </item>
<item id="HF88206B3673A45B8A402B0B10D3C26F7"><enum>(bb)</enum><text>a copy of the complaint for that action.</text> </item></subclause>
<subclause id="HF1B7C67AB08D4BE2BC0FA071B372DA54"><enum>(II)</enum><header>Exemption</header><text>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.</text> </subclause></clause></subparagraph>
<subparagraph id="HFBE70724232E4C7F8621FD3861A384B2"><enum>(B)</enum><header>Intervention</header>
<clause id="H464261034EEB437B93630F9DAAF40624"><enum>(i)</enum><header>In general</header><text>On receiving notice under subparagraph (A)(ii), the Federal Trade Commission shall have the right to intervene in the action that is the subject of the notice.</text> </clause>
<clause id="H8E0B121A5359447FAED34AE91F4538DD"><enum>(ii)</enum><header>Effect of intervention</header><text>If the Federal Trade Commission intervenes in an action under subparagraph (A), it shall have the right—</text>
<subclause id="H3A0044F205FB4356890663DBC13B01D1"><enum>(I)</enum><text>to be heard with respect to any matter that arises in that action; and</text> </subclause>
<subclause id="HE1DD6FDF98D3497793D494A3000038F5"><enum>(II)</enum><text>to file a petition for appeal.</text> </subclause></clause></subparagraph>
<subparagraph id="H69CA541180414A58B27CC951592ED090"><enum>(C)</enum><header>Construction</header><text>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—</text>
<clause id="H251C0D25EA5042DF95CCDFBAB29E4AF4"><enum>(i)</enum><text>conduct investigations;</text> </clause>
<clause id="HDCB1C161C9494C9E8D9291BD460940F4"><enum>(ii)</enum><text>administer oaths or affirmations; or</text> </clause>
<clause id="H79E7AF0024F04B5AB86719D855AD37E4"><enum>(iii)</enum><text>compel the attendance of witnesses or the production of documentary and other evidence.</text> </clause></subparagraph>
<subparagraph id="H1D58E5EBB75C4B889D26B1647F8A2889"><enum>(D)</enum><header>Actions by the commission</header><text>In any case in which an action is instituted by or on behalf of the Federal Trade 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.</text> </subparagraph>
<subparagraph id="H20AF6B221DBA4383AF64C487091042E4"><enum>(E)</enum><header>Venue</header><text>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.</text> </subparagraph>
<subparagraph id="H1A65F178BC5D41C983E6594B0826177F"><enum>(F)</enum><header>Service of process</header><text>In an action brought under subparagraph (A), process may be served in any district in which the defendant—</text>
<clause id="H8D50FB82E7364D00BD27BECEA036856B"><enum>(i)</enum><text>is an inhabitant; or</text> </clause>
<clause id="H1699ACB9FACF43A1A9F1AD6A777AE2B7"><enum>(ii)</enum><text>may be found.</text> </clause></subparagraph>
<subparagraph id="HE19F7936B89E4D51B84E345A4B25C5E6"><enum>(G)</enum><header>Measurement of damages</header><text>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.</text> </subparagraph>
<subparagraph id="H6277D1E8E2B949DDB99A9828F1C33A76"><enum>(H)</enum><header>Exclusion on duplicative relief</header><text>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.</text> </subparagraph></paragraph>
<paragraph id="H57F840F34D824B0EAE26530CCB257AEE"><enum>(7)</enum><header>Effect on antitrust laws</header><text>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 <term>antitrust laws</term> has the meaning given it in the first section of the <act-name parsable-cite="CLAY">Clayton Act</act-name>, except that it includes section 5 of the <act-name parsable-cite="FTCA">Federal Trade Commission Act</act-name> to the extent that such section 5 applies to unfair methods of competition.</text> </paragraph>
<paragraph id="H1F503EF587EF40538035F908C316C900"><enum>(8)</enum><header>Manufacturer</header><text>In this subsection, the term <term>manufacturer</term> means any entity, including any affiliate or licensee of that entity, that is engaged in—</text>
<subparagraph id="H2336DA88ECB6429685F9379EA86D3C6C"><enum>(A)</enum><text>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</text> </subparagraph>
<subparagraph id="HF0AD35F9D64C426AA87F24EDFB9F281A"><enum>(B)</enum><text>the packaging, repackaging, labeling, relabeling, or distribution of a prescription drug.</text> </subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="HDC954581B244491BAE51F8999BCEBAC8"><enum>(b)</enum><header>Prohibited Acts</header><text>The <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> is amended—</text>
<paragraph id="H3478C2E23AB4436F97AB797C61A00138"><enum>(1)</enum><text>in section 301 (21 U.S.C. 331), by striking paragraph (aa) and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="HA2DBCEB9589B47A2B618708E938D852C" style="OLC">
<subsection id="HB5319C4A7D154B0E8951CF1DE4641A0E"><enum>(aa)</enum>
<paragraph commented="no" display-inline="yes-display-inline" id="HE5D52C77B80C4E499518A91A74775DD9"><enum>(1)</enum><text>The sale or trade by a pharmacist, or by a business organization of which the pharmacist is a part, of a qualifying drug that under section 804(a)(2)(A) was imported by the pharmacist, other than—</text>
<subparagraph id="HF56B138B391D4460879DDB665945BD09" indent="up1"><enum>(A)</enum><text>a sale at retail made pursuant to dispensing the drug to a customer of the pharmacist or organization; or</text> </subparagraph>
<subparagraph id="H06044290FE764D8E97F988FD22AE87E4" indent="up1"><enum>(B)</enum><text>a sale or trade of the drug to a pharmacy or a wholesaler registered to import drugs under section 804.</text> </subparagraph></paragraph>
<paragraph id="HD67A8B75662C4A84A3E6EA6FD57B1A87" indent="up1"><enum>(2)</enum><text>The sale or trade by an individual of a qualifying drug that under section 804(a)(2)(B) was imported by the individual.</text> </paragraph>
<paragraph id="H5E2EA12047CB46E881F91DC7710998C2" indent="up1"><enum>(3)</enum><text>The making of a materially false, fictitious, or fraudulent statement or representation, or a material omission, in a notice under clause (i) of section 804(g)(2)(B) or in an application required under section 804(g)(2)(F), or the failure to submit such a notice or application.</text> </paragraph>
<paragraph id="H300AA7C4CD2D4686A5B920DFDA997E2D" indent="up1"><enum>(4)</enum><text>The importation of a drug in violation of a registration condition or other requirement under section 804, the falsification of any record required to be maintained, or provided to the Secretary, under such section, or the violation of any registration condition or other requirement under such section.</text> </paragraph></subsection><after-quoted-block>; and</after-quoted-block></quoted-block> </paragraph>
<paragraph id="HCBE80ECE61E0453CB3A8C4B8C1852956"><enum>(2)</enum><text>in section 303(b) (21 U.S.C. 333(b), by striking paragraph (6) and inserting the following: <italic></italic></text>
<quoted-block id="HF07A83CEA1D94601AA2E4C84FC664688">
<paragraph id="HB7E24FEFA47D431995BE8BF033549027" indent="up1"><enum>(6)</enum><text>Notwithstanding subsection (a), any person that knowingly violates section 301(i) (2) or (3) or section 301(aa)(4) shall be imprisoned not more than 10 years, or fined in accordance with title 18, United States Code, or both.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph></subsection>
<subsection id="HD131237BBBD647B0A8A282F0CA1577B4"><enum>(c)</enum><header>Amendment of certain provisions</header>
<paragraph id="H46A800F9D09B41E49DA68D3B11B6461D"><enum>(1)</enum><header>In general</header><text>Section 801 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 381) is amended by striking subsection (g) and inserting the following:</text>
<quoted-block act-name="Federal Food, Drug, and Cosmetic Act" id="HEEDC9A3CA2AD459EAA0A52692F3F62D2">
<subsection id="HD296B8DC718B4C7C92BD11A38D5D523B"><enum>(g)</enum><text>With respect to a prescription drug that is imported or offered for import into the United States by an individual who is not in the business of such importation, that is not shipped by a registered exporter under section 804, and that is refused admission under subsection (a), the Secretary shall notify the individual that—</text>
<paragraph id="H79628FDF26CE4DE997F3C2A4B18FDCFD"><enum>(1)</enum><text>the drug has been refused admission because the drug was not a lawful import under section 804;</text> </paragraph>
<paragraph id="H84E7453763624329BB55105F3DABE710"><enum>(2)</enum><text>the drug is not otherwise subject to a waiver of the requirements of subsection (a);</text> </paragraph>
<paragraph id="H1E851120ECE442C5BDAFB2F16C43B2F2"><enum>(3)</enum><text>the individual may under section 804 lawfully import certain prescription drugs from exporters registered with the Secretary under section 804; and</text> </paragraph>
<paragraph id="H9266EA8711D84AD489F3B6D950A82230"><enum>(4)</enum><text>the individual can find information about such importation, including a list of registered exporters, on the Internet website of the Food and Drug Administration or through a toll-free telephone number required under section 804.</text> </paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block> </paragraph>
<paragraph id="HBA70C1FD471C452081C7BAD2C05EC505"><enum>(2)</enum><header>Establishment registration</header><text>Section 510(i) of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 360(i)) is amended in paragraph (1) by inserting after <quote>import into the United States</quote> the following: <quote>, including a drug that is, or may be, imported or offered for import into the United States under section 804,</quote>.</text> </paragraph>
<paragraph id="H701B3041DF31458590E8FF5A58C26D46"><enum>(3)</enum><header>Effective date</header><text>The amendments made by this subsection shall take effect on the date that is 90 days after the date of enactment of this Act.</text> </paragraph></subsection>
<subsection id="H8E4FA547A3BF4C78A5F0A9AE1CD41746"><enum>(d)</enum><header>Exhaustion</header>
<paragraph id="HC0C1F9E467524ACABCC791280AC0B5E7"><enum>(1)</enum><header>In general</header><text>Section 271 of title 35, United States Code, is amended—</text>
<subparagraph id="H9F224EC147B14CEF93FEF37E7C0B6F7B"><enum>(A)</enum><text>by redesignating subsections (h) and (i) as (i) and (j), respectively; and</text> </subparagraph>
<subparagraph id="H0357057A7E964A999E971F611DAA11AF"><enum>(B)</enum><text>by inserting after subsection (g) the following:</text>
<quoted-block id="H78BF2B90965849D6B1436BEEFB1DD726">
<subsection id="H4D80A3C3CA9649F188CECF91AF2CF442"><enum>(h)</enum><text>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 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> that was first sold abroad by or under authority of the owner or licensee of such patent.</text> </subsection><after-quoted-block>.</after-quoted-block></quoted-block> </subparagraph></paragraph>
<paragraph id="H34222CDA8598408ABD912AFA5B529338"><enum>(2)</enum><header>Rule of construction</header><text display-inline="yes-display-inline">Nothing in the amendment made by paragraph (1) shall be construed to affect the ability of the owner or licensee of a patent to enforce such patent, subject to such amendment.</text> </paragraph></subsection>
<subsection id="HC096AECA55DA457D96BF20A0A8C783E4"><enum>(e)</enum><header>Effect of Section <enum-in-header>804</enum-in-header></header>
<paragraph id="H46A4E684803B4B7FB15067B779311D19"><enum>(1)</enum><header>In general</header><text>Section 804 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name>, as added by subsection (a), shall permit the importation of qualifying drugs (as defined in such section 804) into the United States without regard to the status of the issuance of implementing regulations—</text>
<subparagraph id="H20B97A51E2B84D10B22E19615A8B496C"><enum>(A)</enum><text>from exporters registered under such section 804 on the date that is 90 days after the date of enactment of this Act; and</text> </subparagraph>
<subparagraph id="H0AA3EC726B1646A4ADD458E5AA0E404B"><enum>(B)</enum><text>from permitted countries, as defined in such section 804, by importers registered under such section 804 on the date that is 1 year after the date of enactment of this Act.</text> </subparagraph></paragraph>
<paragraph id="H516644B3E42F45709DD0451414C8BE68"><enum>(2)</enum><header>Review of registration by certain exporters</header>
<subparagraph id="H644FD1C9C7AB4A159C62AF04488DEDB9"><enum>(A)</enum><header>Review priority</header><text>In the review of registrations submitted under subsection (b) of such section 804, registrations submitted by entities in Canada that are significant exporters of prescription drugs to individuals in the United States as of the date of enactment of this Act will have priority during the 90-day period that begins on such date of enactment.</text> </subparagraph>
<subparagraph id="HF8C6E9076B054F7D8DE4037D63E58BB9"><enum>(B)</enum><header>Period for review</header><text>During such 90-day period, the reference in subsection (b)(2)(A) of such section 804 to 90 days (relating to approval or disapproval of registrations) is, as applied to such entities, deemed to be 30 days.</text> </subparagraph>
<subparagraph id="HD29F02E95D7F47E6BD01F7A3DBF5DD21"><enum>(C)</enum><header>Limitation</header><text>That an exporter in Canada exports, or has exported, prescription drugs to individuals in the United States on or before the date that is 90 days after the date of enactment of this Act shall not serve as a basis, in whole or in part, for disapproving a registration under such section 804 from the exporter.</text> </subparagraph>
<subparagraph id="H3BEFE3448FD84604A5E2242608D81D37"><enum>(D)</enum><header>First year limit on number of exporters</header><text>During the 1-year period beginning on the date of enactment of this Act, the Secretary of Health and Human Services (referred to in this section as the <quote>Secretary</quote>) may limit the number of registered exporters under such section 804 to not less than 50, so long as the Secretary gives priority to those exporters with demonstrated ability to process a high volume of shipments of drugs to individuals in the United States.</text> </subparagraph>
<subparagraph id="H902A1D18012746F4AF9C8310547B9383"><enum>(E)</enum><header>Second year limit on number of exporters</header><text>During the 1-year period beginning on the date that is 1 year after the date of enactment of this Act, the Secretary may limit the number of registered exporters under such section 804 to not less than 100, so long as the Secretary gives priority to those exporters with demonstrated ability to process a high volume of shipments of drugs to individuals in the United States.</text> </subparagraph>
<subparagraph id="HC9E7D7052F664E239A0C2562C44FE251"><enum>(F)</enum><header>Further limit on number of exporters</header><text>During any 1-year period beginning on a date that is 2 or more years after the date of enactment of this Act, the Secretary may limit the number of registered exporters under such section 804 to not less than 25 more than the number of such exporters during the previous 1-year period, so long as the Secretary gives priority to those exporters with demonstrated ability to process a high volume of shipments of drugs to individuals in the United States.</text> </subparagraph></paragraph>
<paragraph id="H7FDF71D716B443FCBAA11B33170A655E"><enum>(3)</enum><header>Limits on number of importers</header>
<subparagraph id="H18E394C31C914A5584F95F728D2F5DDB"><enum>(A)</enum><header>First year limit on number of importers</header><text>During the 1-year period beginning on the date that is 1 year after the date of enactment of this Act, the Secretary may limit the number of registered importers under such section 804 to not less than 100 (of which at least a significant number shall be groups of pharmacies, to the extent feasible given the applications submitted by such groups), so long as the Secretary gives priority to those importers with demonstrated ability to process a high volume of shipments of drugs imported into the United States.</text> </subparagraph>
<subparagraph id="HCB801CD9C50B457180FA81B3743D31FA"><enum>(B)</enum><header>Second year limit on number of importers</header><text>During the 1-year period beginning on the date that is 2 years after the date of enactment of this Act, the Secretary may limit the number of registered importers under such section 804 to not less than 200 (of which at least a significant number shall be groups of pharmacies, to the extent feasible given the applications submitted by such groups), so long as the Secretary gives priority to those importers with demonstrated ability to process a high volume of shipments of drugs into the United States.</text> </subparagraph>
<subparagraph id="H742FB8E20E6C4372B8184FA24DC790DC"><enum>(C)</enum><header>Further limit on number of importers</header><text>During any 1-year period beginning on a date that is 3 or more years after the date of enactment of this Act, the Secretary may limit the number of registered importers under such section 804 to not less than 50 more (of which at least a significant number shall be groups of pharmacies, to the extent feasible given the applications submitted by such groups) than the number of such importers during the previous 1-year period, so long as the Secretary gives priority to those importers with demonstrated ability to process a high volume of shipments of drugs to the United States.</text> </subparagraph></paragraph>
<paragraph id="H739CDF4C44574ED9A61D5508A63A5BDB"><enum>(4)</enum><header>Notices for drugs for import from Canada</header><text>The notice with respect to a qualifying drug introduced for commercial distribution in Canada as of the date of enactment of this Act that is required under subsection (g)(2)(B)(i) of such section 804 shall be submitted to the Secretary not later than 30 days after the date of enactment of this Act if—</text>
<subparagraph id="H05B03C544A7A4A69A79F3F050D104455"><enum>(A)</enum><text>the U.S. label drug (as defined in such section 804) for the qualifying drug is 1 of the 100 prescription drugs with the highest dollar volume of sales in the United States based on the 12-calendar-month period most recently completed before the date of enactment of this Act; or</text> </subparagraph>
<subparagraph id="HC816D9B2AA2D464B9ABB569E31D40E29"><enum>(B)</enum><text>the notice is a notice under subsection (g)(2)(B)(i)(II) of such section 804.</text> </subparagraph></paragraph>
<paragraph id="H9D3A7511A67C4C9AAABEFE6D63C5C334"><enum>(5)</enum><header>Notice for drugs for import from other countries</header><text>The notice with respect to a qualifying drug introduced for commercial distribution in a permitted country other than Canada as of the date of enactment of this Act that is required under subsection (g)(2)(B)(i) of such section 804 shall be submitted to the Secretary not later than 180 days after the date of enactment of this Act if—</text>
<subparagraph id="HC7BE1485B2224FA09F91EA2531695366"><enum>(A)</enum><text>the U.S. label drug for the qualifying drug is 1 of the 100 prescription drugs with the highest dollar volume of sales in the United States based on the 12-calendar-month period that is first completed on the date that is 120 days after the date of enactment of this Act; or</text> </subparagraph>
<subparagraph id="HDD2212DF8CA74B2BA529998EFA569E51"><enum>(B)</enum><text>the notice is a notice under subsection (g)(2)(B)(i)(II) of such section 804.</text> </subparagraph></paragraph>
<paragraph id="HE1F5567C88AC4BB392A4BA70BD520E03"><enum>(6)</enum><header>Notice for other drugs for import</header>
<subparagraph id="H11479DAF3A194B1E87A6AF0EC9F05791"><enum>(A)</enum><header>Guidance on submission dates</header><text>The Secretary shall by guidance establish a series of submission dates for the notices under subsection (g)(2)(B)(i) of such section 804 with respect to qualifying drugs introduced for commercial distribution as of the date of enactment of this Act and that are not required to be submitted under paragraph (4) or (5).</text> </subparagraph>
<subparagraph id="H368993A8A72B4021989F5A891B62F010"><enum>(B)</enum><header>Consistent and efficient use of resources</header><text>The Secretary shall establish the dates described under subparagraph (A) so that such notices described under subparagraph (A) are submitted and reviewed at a rate that allows consistent and efficient use of the resources and staff available to the Secretary for such reviews. The Secretary may condition the requirement to submit such a notice, and the review of such a notice, on the submission by a registered exporter or a registered importer to the Secretary of a notice that such exporter or importer intends to import such qualifying drug to the United States under such section 804.</text> </subparagraph>
<subparagraph id="H682D1958A56F4851A95166BABFC1F9B3"><enum>(C)</enum><header>Priority for drugs with higher sales</header><text>The Secretary shall establish the dates described under subparagraph (A) so that the Secretary reviews the notices described under such subparagraph with respect to qualifying drugs with higher dollar volume of sales in the United States before the notices with respect to drugs with lower sales in the United States.</text> </subparagraph></paragraph>
<paragraph id="H3D49BB20C7754A5790F95D6F5335E195"><enum>(7)</enum><header>Notices for drugs approved after effective date</header><text>The notice required under subsection (g)(2)(B)(i) of such section 804 for a qualifying drug first introduced for commercial distribution in a permitted country (as defined in such section 804) after the date of enactment of this Act shall be submitted to and reviewed by the Secretary as provided under subsection (g)(2)(B) of such section 804, without regard to paragraph (4), (5), or (6).</text> </paragraph>
<paragraph id="H498C39B7BEB646BDA80C226686C28C82"><enum>(8)</enum><header>Report</header><text>Beginning with the first full fiscal year after the date of enactment of this Act, not later than 90 days after the end of each fiscal year during which the Secretary reviews a notice referred to in paragraph (4), (5), or (6), the Secretary shall submit a report to Congress concerning the progress of the Food and Drug Administration in reviewing the notices referred to in paragraphs (4), (5), and (6).</text> </paragraph>
<paragraph id="H47900A37437E482FBB3379619499C423"><enum>(9)</enum><header>User fees</header>
<subparagraph id="H42A0650DC5E54B8C9EBE4471214F94A6"><enum>(A)</enum><header>Exporters</header><text>When establishing an aggregate total of fees to be collected from exporters under subsection (f)(2) of such section 804, the Secretary shall, under subsection (f)(3)(C)(i) of such section 804, estimate the total price of drugs imported under subsection (a) of such section 804 into the United States by registered exporters during the first fiscal year in which this Act takes effect to be an amount equal to the amount which bears the same ratio to $1,000,000,000 as the number of days in such fiscal year during which this Act is effective bears to 365.</text> </subparagraph>
<subparagraph id="H4BF8081EB5A94B238D14121A7413A8E6"><enum>(B)</enum><header>Importers</header><text>When establishing an aggregate total of fees to be collected from importers under subsection (e)(2) of such section 804, the Secretary shall, under subsection (e)(3)(C)(i) of such section 804, estimate the total price of drugs imported under subsection (a) of such section 804 into the United States by registered importers during—</text>
<clause id="HB0A93CD98A8646D5A5E74A608CA72CB7"><enum>(i)</enum><text>the first fiscal year in which this Act takes effect to be an amount equal to the amount which bears the same ratio to $1,000,000,000 as the number of days in such fiscal year during which this Act is effective bears to 365; and</text> </clause>
<clause id="HAF61006EDFCD49CAB1F719D0D190FE4C"><enum>(ii)</enum><text>the second fiscal year in which this Act is in effect to be $3,000,000,000.</text> </clause></subparagraph>
<subparagraph id="H1D8EDB97922B438E87B00EE591688C2F"><enum>(C)</enum><header>Second year adjustment</header>
<clause id="HB4CBA19D3E4C47BA8494B02E052889F9"><enum>(i)</enum><header>Reports</header><text>Not later than February 20 of the second fiscal year in which this Act is in effect, registered importers shall report to the Secretary the total price and the total volume of drugs imported to the United States by the importer during the 4-month period from October 1 through January 31 of such fiscal year.</text> </clause>
<clause id="H35B1703E4B5D4609A0FF4913D2322112"><enum>(ii)</enum><header>Reestimate</header><text>Notwithstanding subsection (e)(3)(C)(ii) of such section 804 or subparagraph (B), the Secretary shall reestimate the total price of qualifying drugs imported under subsection (a) of such section 804 into the United States by registered importers during the second fiscal year in which this Act is in effect. Such reestimate shall be equal to—</text>
<subclause id="HC03A74322CB7470387434B868A528467"><enum>(I)</enum><text>the total price of qualifying drugs imported by each importer as reported under clause (i); multiplied by</text> </subclause>
<subclause id="H58396F18595649B6BFAB1902BAEF5E8E"><enum>(II)</enum><text>3.</text> </subclause></clause>
<clause id="H3A20A8D6E13D4CE28CC2ABB8BF6BC780"><enum>(iii)</enum><header>Adjustment</header><text>The Secretary shall adjust the fee due on April 1 of the second fiscal year in which this Act is in effect, from each importer so that the aggregate total of fees collected under subsection (e)(2) for such fiscal year does not exceed the total price of qualifying drugs imported under subsection (a) of such section 804 into the United States by registered importers during such fiscal year as reestimated under clause (ii).</text> </clause></subparagraph>
<subparagraph id="H7F5A2509F8AE4CAB8367D7B4DEE30182"><enum>(D)</enum><header>Failure to pay fees</header><text>Notwithstanding any other provision of this section, the Secretary may prohibit a registered importer or exporter that is required to pay user fees under subsection (e) or (f) of such section 804 and that fails to pay such fees within 30 days after the date on which it is due, from importing or offering for importation a qualifying drug under such section 804 until such fee is paid.</text> </subparagraph>
<subparagraph id="HE352F0820C0A43F7B7DD448234155096"><enum>(E)</enum><header>Annual report</header>
<clause id="HD843937ED86E4745A43C378058FF21D7"><enum>(i)</enum><header>Food and Drug Administration</header><text>Not later than 180 days after the end of each fiscal year during which fees are collected under subsection (e), (f), or (g)(2)(B)(iv) of such section 804, the Secretary shall prepare and submit to the House of Representatives and the Senate a report on the implementation of the authority for such fees during such fiscal year and the use, by the Food and Drug Administration, of the fees collected for the fiscal year for which the report is made and credited to the Food and Drug Administration.</text> </clause>
<clause id="H4289D6AD10134A29964E40741336C0F8"><enum>(ii)</enum><header>Customs and border control</header><text>Not later than 180 days after the end of each fiscal year during which fees are collected under subsection (e) or (f) of such section 804, the Secretary of Homeland Security, in consultation with the Secretary of the Treasury, shall prepare and submit to the House of Representatives and the Senate a report on the use, by the Bureau of Customs and Border Protection, of the fees, if any, transferred by the Secretary to the Bureau of Customs and Border Protection for the fiscal year for which the report is made.</text> </clause></subparagraph></paragraph>
<paragraph id="HDA230C4629534D1082F5D59422BAEFCC"><enum>(10)</enum><header>Special rule regarding importation by individuals</header>
<subparagraph id="H0D2FA1D86E324AF2BD9B1C5D3FF21999"><enum>(A)</enum><header>In general</header><text>Notwithstanding any provision of this Act (or an amendment made by this Act), the Secretary shall expedite the designation of any additional countries from which an individual may import a qualifying drug into the United States under such section 804 if any action implemented by the Government of Canada has the effect of limiting or prohibiting the importation of qualifying drugs into the United States from Canada.</text> </subparagraph>
<subparagraph id="H78A7A8F7ED414AC6A288A446E928D756"><enum>(B)</enum><header>Timing and criteria</header><text>The Secretary shall designate such additional countries under subparagraph (A)—</text>
<clause id="H9FD8F0ABD2504F3EB04CEE81400AEDC2"><enum>(i)</enum><text>not later than 6 months after the date of the action by the Government of Canada described under such subparagraph; and</text> </clause>
<clause id="HBA884C76021641E9972535D96FB59BDE"><enum>(ii)</enum><text>using the criteria described under subsection (a)(4)(D)(i)(II) of such section 804.</text> </clause></subparagraph></paragraph></subsection>
<subsection id="H74E94ECE055B4ECAAE4A8AD1157B630F"><enum>(f)</enum><header>Implementation of Section <enum-in-header>804</enum-in-header></header>
<paragraph id="H91F22F684E0E489DA9AC2B8BEED77888"><enum>(1)</enum><header>Interim rule</header><text>The Secretary may promulgate an interim rule for implementing section 804 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name>, as added by subsection (a) of this section.</text> </paragraph>
<paragraph id="HC4D9A9AE7A3F483D890DB2EA14F18257"><enum>(2)</enum><header>No notice of proposed rulemaking</header><text>The interim rule described under paragraph (1) may be developed and promulgated by the Secretary without providing general notice of proposed rulemaking.</text> </paragraph>
<paragraph id="H044E28A8F0E7452DAE9BCC556BD6BCBE"><enum>(3)</enum><header>Final rule</header><text>Not later than 1 year after the date on which the Secretary promulgates an interim rule under paragraph (1), the Secretary shall, in accordance with procedures under section 553 of title 5, United States Code, promulgate a final rule for implementing such section 804, which may incorporate by reference provisions of the interim rule provided for under paragraph (1), to the extent that such provisions are not modified.</text> </paragraph></subsection>
<subsection id="H10BFF2D020044B2895660AE1D934AD46"><enum>(g)</enum><header>Consumer education</header><text>The Secretary shall carry out activities that educate consumers—</text>
<paragraph id="HDCA6E58FD77D4952B7B4BC4B597A5A38"><enum>(1)</enum><text>with regard to the availability of qualifying drugs for import for personal use from an exporter registered with and approved by the Food and Drug Administration under section 804 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name>, as added by this section, including information on how to verify whether an exporter is registered and approved by use of the Internet website of the Food and Drug Administration and the toll-free telephone number required by this Act;</text> </paragraph>
<paragraph id="HF18910BA1C9944B499EE75652CE75695"><enum>(2)</enum><text>that drugs that consumers attempt to import from an exporter that is not registered with and approved by the Food and Drug Administration can be seized by the United States Customs Service and destroyed, and that such drugs may be counterfeit, unapproved, unsafe, or ineffective;</text> </paragraph>
<paragraph id="H7AB77B4AA2AD461D8AE3265B33C4B896"><enum>(3)</enum><text>with regard to the suspension and termination of any registration of a registered importer or exporter under such section 804; and</text> </paragraph>
<paragraph id="HDC9FD492661C449786D729722FC91A5B"><enum>(4)</enum><text>with regard to the availability at domestic retail pharmacies of qualifying drugs imported under such section 804 by domestic wholesalers and pharmacies registered with and approved by the Food and Drug Administration.</text> </paragraph></subsection>
<subsection id="H1CAA4263D92A4557B6834D7CDE55AAA9"><enum>(h)</enum><header>Effect on administration practices</header><text>Notwithstanding any provision of this Act (and the amendments made by this Act), the practices and policies of the Food and Drug Administration and Bureau of Customs and Border Protection, in effect on January 1, 2004, with respect to the importation of prescription drugs into the United States by an individual, on the person of such individual, for personal use, shall remain in effect.</text> </subsection>
<subsection id="HE7BE7AB603F84DEF9401B07914B545DB"><enum>(i)</enum><header>Report to Congress</header><text>The Federal Trade Commission shall, on an annual basis, submit to Congress a report that describes any action taken during the period for which the report is being prepared to enforce the provisions of section 804(n) of the Federal Food, Drug, and Cosmetic Act (as added by this Act), including any pending investigations or civil actions under such section.</text> </subsection></section>
<section id="HCA6206CEBFC649219A02B0E415848E1B"><enum>303.</enum><header>Disposition of certain drugs denied admission into United States</header>
<subsection id="HB8BDF444B1D24A2AAD0FED7B8318603A"><enum>(a)</enum><header>In general</header><text>Chapter VIII of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 381 et seq.), as amended by section 302, is further amended by adding at the end the following section:</text>
<quoted-block act-name="Federal Food, Drug, and Cosmetic Act" id="H8F402DD5A5804060865524BBA0A65A81">
<section id="HBC184BB082C040C482F2DFCB08B65678"><enum>805.</enum><header>Disposition of certain drugs denied admission</header>
<subsection id="HA4C92C68EBA74927AB90028DC3F76085"><enum>(a)</enum><header>In general</header><text>The Secretary of Homeland Security shall deliver to the Secretary a shipment of drugs that is imported or offered for import into the United States if—</text>
<paragraph id="H26CA4E46D78549C08716ED6232215397"><enum>(1)</enum><text>the shipment has a declared value of less than $10,000; and</text> </paragraph>
<paragraph id="HCC2D591EC2DD4BB484C25811ECFA7276"><enum>(2)</enum>
<subparagraph commented="no" display-inline="yes-display-inline" id="HFED10E1A70824C1E9F22759CE554BFE3"><enum>(A)</enum><text>the shipping container for such drugs does not bear the markings required under section 804(d)(2); or</text> </subparagraph>
<subparagraph id="H0F528A2721EB4574AA8FA690E214C7E1" indent="up1"><enum>(B)</enum><text>the Secretary has requested delivery of such shipment of drugs.</text> </subparagraph></paragraph></subsection>
<subsection id="H889813ED53C543DE9D28841A30228797"><enum>(b)</enum><header>No bond or export</header><text>Section 801(b) does not authorize the delivery to the owner or consignee of drugs delivered to the Secretary under subsection (a) pursuant to the execution of a bond, and such drugs may not be exported.</text> </subsection>
<subsection id="HA7F21E10616747FBB30A340A3224E6E9"><enum>(c)</enum><header>Destruction of violative shipment</header><text>The Secretary shall destroy a shipment of drugs delivered by the Secretary of Homeland Security to the Secretary under subsection (a) if—</text>
<paragraph id="HC6911A290D0C45AF83F13729A12DCE1D"><enum>(1)</enum><text>in the case of drugs that are imported or offered for import from a registered exporter under section 804, the drugs are in violation of any standard described in section 804(g)(5); or</text> </paragraph>
<paragraph id="HCFA32095D5974B64A4D8C64D78093C63"><enum>(2)</enum><text>in the case of drugs that are not imported or offered for import from a registered exporter under section 804, the drugs are in violation of a standard referred to in section 801(a) or 801(d)(1).</text> </paragraph></subsection>
<subsection id="HA4700CA6E4784BE89BB9DB7BD989748B"><enum>(d)</enum><header>Certain procedures</header>
<paragraph id="H0D96A4E0C8574398870D3EAFA916411E"><enum>(1)</enum><header>In general</header><text>The delivery and destruction of drugs under this section may be carried out without notice to the importer, owner, or consignee of the drugs except as required by section 801(g) or section 804(i)(2). The issuance of receipts for the drugs, and recordkeeping activities regarding the drugs, may be carried out on a summary basis.</text> </paragraph>
<paragraph id="H0C04037DB2944C7F9A2A652D60B42BED"><enum>(2)</enum><header>Objective of procedures</header><text>Procedures promulgated under paragraph (1) shall be designed toward the objective of ensuring that, with respect to efficiently utilizing Federal resources available for carrying out this section, a substantial majority of shipments of drugs subject to described in subsection (c) are identified and destroyed.</text> </paragraph></subsection>
<subsection id="H951E697D49774C679EFC8878921DA585"><enum>(e)</enum><header>Evidence exception</header><text>Drugs may not be destroyed under subsection (c) to the extent that the Attorney General of the United States determines that the drugs should be preserved as evidence or potential evidence with respect to an offense against the United States.</text> </subsection>
<subsection id="HBF45DD7D543C42318A0907B58D06F83B"><enum>(f)</enum><header>Rule of construction</header><text>This section may not be construed as having any legal effect on applicable law with respect to a shipment of drugs that is imported or offered for import into the United States and has a declared value equal to or greater than $10,000.</text> </subsection></section><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="HDB429929C03B4EB9AF606A9ACFF3639F"><enum>(b)</enum><header>Procedures</header><text>Procedures for carrying out section 805 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name>, as added by subsection (a), shall be established not later than 90 days after the date of the enactment of this Act.</text> </subsection>
<subsection id="HB85392C28203468C9F43E71A34FF9FF6"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall take effect on the date that is 90 days after the date of enactment of this Act.</text> </subsection></section>
<section id="HB8724C26D029447C8331C6E58A466ECE"><enum>304.</enum><header>Wholesale distribution of drugs; statements regarding prior sale, purchase, or trade</header>
<subsection id="H247A232DE10445D598FDCA6CB784F235"><enum>(a)</enum><header>Striking of exemptions; applicability to registered exporters</header><text>Section 503(e) of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 353(e)) is amended—</text>
<paragraph id="H695B5E12490D45A5B5CDCF631DB25E8C"><enum>(1)</enum><text>in paragraph (1)—</text>
<subparagraph id="H301B0FF6DA364C9D9680FE35DC60E124"><enum>(A)</enum><text>by striking <quote>and who is not the manufacturer or an authorized distributor of record of such drug</quote>;</text> </subparagraph>
<subparagraph id="HBB1FF8A39F7E4DBEA15A9887253132B2"><enum>(B)</enum><text>by striking <quote>to an authorized distributor of record or</quote>; and</text> </subparagraph>
<subparagraph id="H5B9F964E8CE64F028EE4FE40D1D7CACB"><enum>(C)</enum><text>by striking subparagraph (B) and inserting the following:</text>
<quoted-block id="HAF15CA16DC44422D871B8062CD88E69A">
<subparagraph id="H237CAD91F8ED444393CEF7BB27B6C67C" indent="up2"><enum>(B)</enum><text>The fact that a drug subject to subsection (b) is exported from the United States does not with respect to such drug exempt any person that is engaged in the business of the wholesale distribution of the drug from providing the statement described in subparagraph (A) to the person that receives the drug pursuant to the export of the drug.</text> </subparagraph>
<subparagraph id="H2A1BEC91E1E641DA88BFFA1625BD78A9" indent="up2"><enum>(C)</enum>
<clause commented="no" display-inline="yes-display-inline" id="H79E9E740B6754A259196108C078820F8"><enum>(i)</enum><text>The Secretary shall by regulation establish requirements that supersede subparagraph (A) (referred to in this subparagraph as <quote>alternative requirements</quote>) to identify the chain of custody of a drug subject to subsection (b) from the manufacturer of the drug throughout the wholesale distribution of the drug to a pharmacist who intends to sell the drug at retail if the Secretary determines that the alternative requirements, which may include standardized anti-counterfeiting or track-and-trace technologies, will identify such chain of custody or the identity of the discrete package of the drug from which the drug is dispensed with equal or greater certainty to the requirements of subparagraph (A), and that the alternative requirements are economically and technically feasible.</text> </clause>
<clause id="H636D98351A604BEF88E125C8045CA592" indent="up1"><enum>(ii)</enum><text>When the Secretary promulgates a final rule to establish such alternative requirements, the final rule in addition shall, with respect to the registration condition established in clause (i) of section 804(c)(3)(B), establish a condition equivalent to the alternative requirements, and such equivalent condition may be met in lieu of the registration condition established in such clause (i).</text> </clause></subparagraph><after-quoted-block>;</after-quoted-block></quoted-block> </subparagraph></paragraph>
<paragraph id="HF17FAE8010FB468D9C9BE72B9F2BE03A"><enum>(2)</enum><text>in paragraph (2)(A), by adding at the end the following: <quote>The preceding sentence may not be construed as having any applicability with respect to a registered exporter under section 804.</quote>; and</text> </paragraph>
<paragraph id="HB5472A88A9ED43ECB77E13B05D2D61D5"><enum>(3)</enum><text>in paragraph (3), by striking <quote>and subsection (d)—</quote> in the matter preceding subparagraph (A) and all that follows through <quote>the term <term>wholesale distribution</term> means</quote> in subparagraph (B) and inserting the following: <quote>and subsection (d), the term <term>wholesale distribution</term> means</quote>.</text> </paragraph></subsection>
<subsection id="H677E276BEE5E418BB7770DC5DE9A0801"><enum>(b)</enum><header>Conforming amendment</header><text>Section 503(d) of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 353(d)) is amended by adding at the end the following:</text>
<quoted-block act-name="Federal Food, Drug, and Cosmetic Act" id="H5B8F3B507D02492A9760F8996EA6B743">
<paragraph id="HF2C208238016409C8EFBC843A5EE06B1" indent="up1"><enum>(4)</enum><text>Each manufacturer of a drug subject to subsection (b) shall maintain at its corporate offices a current list of the authorized distributors of record of such drug.</text> </paragraph>
<paragraph id="HDBDBAB614A774D99B8D9F62EEC3A0471" indent="up1"><enum>(5)</enum><text>For purposes of this subsection, the term <term>authorized distributors of record</term> means those distributors with whom a manufacturer has established an ongoing relationship to distribute such manufacturer’s products.</text> </paragraph><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="HC14B89A953AE4ADFBF04083D450D6443"><enum>(c)</enum><header>Effective date</header>
<paragraph id="HF36CF4ADB9FF42449B37392FBB322086"><enum>(1)</enum><header>In general</header><text>The amendments made by paragraphs (1) and (3) of subsection (a) and by subsection (b) shall take effect on January 1, 2012.</text> </paragraph>
<paragraph id="HCDFABFE29EC54A4F90FC01564101B7B8"><enum>(2)</enum><header>Drugs imported by registered importers under section 804</header><text>Notwithstanding paragraph (1), the amendments made by paragraphs (1) and (3) of subsection (a) and by subsection (b) shall take effect on the date that is 90 days after the date of enactment of this Act with respect to qualifying drugs imported under section 804 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name>, as added by section 303.</text> </paragraph>
<paragraph id="HD4F8461C93294A1B9C065BA99EF4B376"><enum>(3)</enum><header>Effect with respect to registered exporters</header><text>The amendment made by subsection (a)(2) shall take effect on the date that is 90 days after the date of enactment of this Act.</text> </paragraph>
<paragraph id="H1899C822CDD04D238D694A71DC052C8B"><enum>(4)</enum><header>Alternative requirements</header><text>The Secretary shall issue regulations to establish the alternative requirements, referred to in the amendment made by subsection (a)(1), that take effect not later than January 1, 2012.</text> </paragraph>
<paragraph id="H815A854D2C4D41EB9968D5CBD82837C0"><enum>(5)</enum><header>Intermediate requirements</header><text>The Secretary shall by regulation require the use of standardized anti-counterfeiting or track-and-trace technologies on prescription drugs at the case and pallet level effective not later than 1 year after the date of enactment of this Act.</text> </paragraph>
<paragraph id="H891C1D42F1AD48919E95FA91DA80BF3F"><enum>(6)</enum><header>Additional requirements</header>
<subparagraph id="HCD9D868E682E4C2EBA0410E873AEE983"><enum>(A)</enum><header>In general</header><text>Notwithstanding any other provision of this section, the Secretary shall, not later than 18 months after the date of enactment of this Act, require that the packaging of any prescription drug incorporates—</text>
<clause id="H3265F1EE8E854FF88B187752DEC8DE0B"><enum>(i)</enum><text>a standardized numerical identifier unique to each package of such drug, applied at the point of manufacturing and repackaging (in which case the numerical identifier shall be linked to the numerical identifier applied at the point of manufacturing); and</text> </clause>
<clause id="H79580C92EC414FADAB87FE2D5D76916E"><enum>(ii)</enum>
<subclause commented="no" display-inline="yes-display-inline" id="HB99FD67198D646E888388C6F8B002BC8"><enum>(I)</enum><text>overt optically variable counterfeit-resistant technologies that—</text>
<item id="H56F876B83B1D4C458B56BB74E3A058C1" indent="up1"><enum>(aa)</enum><text>are visible to the naked eye, providing for visual identification of product authenticity without the need for readers, microscopes, lighting devices, or scanners;</text> </item>
<item id="H4F046EA7A5A1497D95F6989D20A2D1A6" indent="up1"><enum>(bb)</enum><text>are similar to that used by the Bureau of Engraving and Printing to secure United States currency;</text> </item>
<item id="H2B83CC2A1B9245D29C3CAC4EF40878DC" indent="up1"><enum>(cc)</enum><text>are manufactured and distributed in a highly secure, tightly controlled environment; and</text> </item>
<item id="H6E07E66A32C24E938BBB906F39D52F94" indent="up1"><enum>(dd)</enum><text>incorporate additional layers of nonvisible convert security features up to and including forensic capability, as described in subparagraph (B); or</text> </item></subclause>
<subclause id="H2A709D188AD74A5EAC91BD83D332AE65" indent="up1"><enum>(II)</enum><text>technologies that have a function of security comparable to that described in subclause (I), as determined by the Secretary.</text> </subclause></clause></subparagraph>
<subparagraph id="HC5393E86CA8A4DD1864E141E4E6F968C"><enum>(B)</enum><header>Standards for packaging</header><text>For the purpose of making it more difficult to counterfeit the packaging of drugs subject to this paragraph, the manufacturers of such drugs shall incorporate the technologies described in subparagraph (A) into at least 1 additional element of the physical packaging of the drugs, including blister packs, shrink wrap, package labels, package seals, bottles, and boxes.</text> </subparagraph></paragraph></subsection></section>
<section id="HA4E2E28ED62F4439BE0EC1F5C02C9811"><enum>305.</enum><header>Internet sales of prescription drugs</header>
<subsection id="H92DA90A36829466E8E8114A0EBCC9F6C"><enum>(a)</enum><header>In general</header><text>Chapter V of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 351 et seq.) is amended by inserting after section 503B the following:</text>
<quoted-block act-name="Federal Food, Drug, and Cosmetic Act" id="H13C1AD037F4746DAB667199B7E6035E1">
<section id="HA9D917F998E540C4AFB71D55148293D6"><enum>503C.</enum><header>Internet sales of prescription drugs</header>
<subsection id="H4EAA0FA6E5C34FC3A6DA635DE5C4834A"><enum>(a)</enum><header>Requirements regarding information on Internet site</header>
<paragraph id="H5F0A06185FF547039748D7C766CBF101"><enum>(1)</enum><header>In general</header><text>A person may not dispense a prescription drug pursuant to a sale of the drug by such person if—</text>
<subparagraph id="HE99E9ECE39DE4B7CA8FC12CC5BC31180"><enum>(A)</enum><text>the purchaser of the drug submitted the purchase order for the drug, or conducted any other part of the sales transaction for the drug, through an Internet site;</text> </subparagraph>
<subparagraph id="HE0A65C8A0F004E839E07737DB7C62884"><enum>(B)</enum><text>the person dispenses the drug to the purchaser by mailing or shipping the drug to the purchaser; and</text> </subparagraph>
<subparagraph id="HFCBCC2859C074CCE91C064668B676BB8"><enum>(C)</enum><text>such site, or any other Internet site used by such person for purposes of sales of a prescription drug, fails to meet each of the requirements specified in paragraph (2), other than a site or pages on a site that—</text>
<clause id="H2FE688D4D81E4933A873A28C304E0403"><enum>(i)</enum><text>are not intended to be accessed by purchasers or prospective purchasers; or</text> </clause>
<clause id="H19F96B9172EB46D0B865CF9F528C8108"><enum>(ii)</enum><text>provide an Internet information location tool within the meaning of section 231(e)(5) of the <act-name parsable-cite="CA34">Communications Act of 1934</act-name> (47 U.S.C. 231(e)(5)).</text> </clause></subparagraph></paragraph>
<paragraph id="HBA8F29A865F54BF9929422F1F90F64CD"><enum>(2)</enum><header>Requirements</header><text>With respect to an Internet site, the requirements referred to in subparagraph (C) of paragraph (1) for a person to whom such paragraph applies are as follows:</text>
<subparagraph id="H5D0B2C01D15E4C58BB15CC5942195BB1"><enum>(A)</enum><text>Each page of the site shall include either the following information or a link to a page that provides the following information:</text>
<clause id="HB9FB6AF894E94AA7A10972B7B1E4A6EB"><enum>(i)</enum><text>The name of such person.</text> </clause>
<clause id="H64A512993DBB4B9B96CF1EA435A20AE0"><enum>(ii)</enum><text>Each State in which the person is authorized by law to dispense prescription drugs.</text> </clause>
<clause id="H370DBB8E98DA4560A02FC56D010D7319"><enum>(iii)</enum><text>The address and telephone number of each place of business of the person with respect to sales of prescription drugs through the Internet, other than a place of business that does not mail or ship prescription drugs to purchasers.</text> </clause>
<clause id="H3B31912AAFBD4B82BA1BFD862B16571C"><enum>(iv)</enum><text>The name of each individual who serves as a pharmacist for prescription drugs that are mailed or shipped pursuant to the site, and each State in which the individual is authorized by law to dispense prescription drugs.</text> </clause>
<clause id="HBF8FFE1C284342809D43D970D9BCCEDC"><enum>(v)</enum><text>If the person provides for medical consultations through the site for purposes of providing prescriptions, the name of each individual who provides such consultations; each State in which the individual is licensed or otherwise authorized by law to provide such consultations or practice medicine; and the type or types of health professions for which the individual holds such licenses or other authorizations.</text> </clause></subparagraph>
<subparagraph id="H95135F8173FE4A3CB8680395DFB6CA0C"><enum>(B)</enum><text>A link to which paragraph (1) applies shall be displayed in a clear and prominent place and manner, and shall include in the caption for the link the words <quote>licensing and contact information</quote>.</text> </subparagraph></paragraph></subsection>
<subsection id="H14E62CB82BA64316B188FE47F2BE5286"><enum>(b)</enum><header>Internet sales without appropriate medical relationships</header>
<paragraph id="H10DD7C8232A44E02A528B972B12365D4"><enum>(1)</enum><header>In general</header><text>Except as provided in paragraph (2), a person may not dispense a prescription drug, or sell such a drug, if—</text>
<subparagraph id="H649935E1026248C7B21D48BF9054CCAE"><enum>(A)</enum><text>for purposes of such dispensing or sale, the purchaser communicated with the person through the Internet;</text> </subparagraph>
<subparagraph id="HD06B9372F14E45F9ACA913AF784D61B1"><enum>(B)</enum><text>the patient for whom the drug was dispensed or purchased did not, when such communications began, have a prescription for the drug that is valid in the United States;</text> </subparagraph>
<subparagraph id="H27517BE9CD894952BE0C515D12594BAD"><enum>(C)</enum><text>pursuant to such communications, the person provided for the involvement of a practitioner, or an individual represented by the person as a practitioner, and the practitioner or such individual issued a prescription for the drug that was purchased;</text> </subparagraph>
<subparagraph id="HF4364E0A043D4B1EAB3D63F88C238058"><enum>(D)</enum><text>the person knew, or had reason to know, that the practitioner or the individual referred to in subparagraph (C) did not, when issuing the prescription, have a qualifying medical relationship with the patient; and</text> </subparagraph>
<subparagraph id="HFE991F59B9DD45B99A497F687351BB4E"><enum>(E)</enum><text>the person received payment for the dispensing or sale of the drug.</text> </subparagraph><continuation-text continuation-text-level="paragraph">For purposes of subparagraph (E), payment is received if money or other valuable consideration is received.</continuation-text></paragraph>
<paragraph id="H519787D220784B0AAE9F89A3939C1F1E"><enum>(2)</enum><header>Exceptions</header><text>Paragraph (1) does not apply to—</text>
<subparagraph id="H39777A8A74FA4E2685F4AFA4E0B38A5A"><enum>(A)</enum><text>the dispensing or selling of a prescription drug pursuant to telemedicine practices sponsored by—</text>
<clause id="HC0A5252E6C7E4F78969B7C588C66DF29"><enum>(i)</enum><text>a hospital that has in effect a provider agreement under title XVIII of the <act-name parsable-cite="SSA">Social Security Act</act-name> (relating to the Medicare program); or</text> </clause>
<clause id="H50456EAE1D9449A082901584286B0C02"><enum>(ii)</enum><text>a group practice that has not fewer than 100 physicians who have in effect provider agreements under such title; or</text> </clause></subparagraph>
<subparagraph id="H6E0919BBBAD64831A84B5E7E096CC7E2"><enum>(B)</enum><text>the dispensing or selling of a prescription drug pursuant to practices that promote the public health, as determined by the Secretary by regulation.</text> </subparagraph></paragraph>
<paragraph id="H1ADE43E32D0044A79FAE7D910EE60EAE"><enum>(3)</enum><header>Qualifying medical relationship</header>
<subparagraph id="H4A4ACEAC150044108A7E70C24073BA87"><enum>(A)</enum><header>In general</header><text>With respect to issuing a prescription for a drug for a patient, a practitioner has a qualifying medical relationship with the patient for purposes of this section if—</text>
<clause id="H629E633C13FC45F7AAFB8F1A2FAEAA88"><enum>(i)</enum><text>at least one in-person medical evaluation of the patient has been conducted by the practitioner; or</text> </clause>
<clause id="HC30F3A11958D408EB28C8E7A9D4F16E7"><enum>(ii)</enum><text>the practitioner conducts a medical evaluation of the patient as a covering practitioner.</text> </clause></subparagraph>
<subparagraph id="H1FA6AAC493594C1AB84F6DF0F7F06C09"><enum>(B)</enum><header>In-person medical evaluation</header><text>A medical evaluation by a practitioner is an in-person medical evaluation for purposes of this section if the practitioner is in the physical presence of the patient as part of conducting the evaluation, without regard to whether portions of the evaluation are conducted by other health professionals.</text> </subparagraph>
<subparagraph id="HE3F76DF6D04147F5987E5D28B6525D59"><enum>(C)</enum><header>Covering practitioner</header><text>With respect to a patient, a practitioner is a covering practitioner for purposes of this section if the practitioner conducts a medical evaluation of the patient at the request of a practitioner who has conducted at least one in-person medical evaluation of the patient and is temporarily unavailable to conduct the evaluation of the patient. A practitioner is a covering practitioner without regard to whether the practitioner has conducted any in-person medical evaluation of the patient involved.</text> </subparagraph></paragraph>
<paragraph id="H297D6F8AA86E411EBE8D967D473D32B5"><enum>(4)</enum><header>Rules of construction</header>
<subparagraph id="HA5B2DC6543494DAF991951EAEC9521D2"><enum>(A)</enum><header>Individuals represented as practitioners</header><text>A person who is not a practitioner (as defined in subsection (e)(1)) lacks legal capacity under this section to have a qualifying medical relationship with any patient.</text> </subparagraph>
<subparagraph id="H0B21D85BC497407486C97EA97731D0FD"><enum>(B)</enum><header>Standard practice of pharmacy</header><text>Paragraph (1) may not be construed as prohibiting any conduct that is a standard practice in the practice of pharmacy.</text> </subparagraph>
<subparagraph id="HCCD45AC1FBD44E4FA9BCFA880FF2C2E9"><enum>(C)</enum><header>Applicability of requirements</header><text>Paragraph (3) may not be construed as having any applicability beyond this section, and does not affect any State law, or interpretation of State law, concerning the practice of medicine.</text> </subparagraph></paragraph></subsection>
<subsection id="HC37FF7ACCC354E238C51C1E4C669A0BE"><enum>(c)</enum><header>Actions by States</header>
<paragraph id="HA35BC5E9E2734C17AA8F71F8E076A5AA"><enum>(1)</enum><header>In general</header><text>Whenever an attorney general of any State has reason to believe that the interests of the residents of that State have been or are being threatened or adversely affected because any person has engaged or is engaging in a pattern or practice that violates section 301(l), the State may bring a civil action on behalf of its residents in an appropriate district court of the United States to enjoin such practice, to enforce compliance with such section (including a nationwide injunction), to obtain damages, restitution, or other compensation on behalf of residents of such State, to obtain reasonable attorneys fees and costs if the State prevails in the civil action, or to obtain such further and other relief as the court may deem appropriate.</text> </paragraph>
<paragraph id="HC0584D43C87F4AFF95705B4AC23D2AAB"><enum>(2)</enum><header>Notice</header><text>The State shall serve prior written notice of any civil action under paragraph (1) or (5)(B) upon the Secretary and provide the Secretary with a copy of its complaint, except that if it is not feasible for the State to provide such prior notice, the State shall serve such notice immediately upon instituting such action. Upon receiving a notice respecting a civil action, the Secretary shall have the right—</text>
<subparagraph id="H0EDE46EC1FA74764ADE5F85EFCAA60D2"><enum>(A)</enum><text>to intervene in such action;</text> </subparagraph>
<subparagraph id="HE7C520FAEA344074BAFEA4EC5FE4E046"><enum>(B)</enum><text>upon so intervening, to be heard on all matters arising therein; and</text> </subparagraph>
<subparagraph id="H31054F7A94EA4535B91E10FF1B20A881"><enum>(C)</enum><text>to file petitions for appeal.</text> </subparagraph></paragraph>
<paragraph id="HBB68E29C93C941678421A91424E65516"><enum>(3)</enum><header>Construction</header><text>For purposes of bringing any civil action under paragraph (1), nothing in this chapter shall prevent an attorney general of a State from exercising the powers conferred on the attorney general by the laws of such State to conduct investigations or to administer oaths or affirmations or to compel the attendance of witnesses or the production of documentary and other evidence.</text> </paragraph>
<paragraph id="H46FE8A0327E8493B8A89ECC196A56FF2"><enum>(4)</enum><header>Venue; service of process</header><text>Any civil action brought under paragraph (1) in a district court of the United States may be brought in the district in which the defendant is found, is an inhabitant, or transacts business or wherever venue is proper under section 1391 of title 28, United States Code. Process in such an action may be served in any district in which the defendant is an inhabitant or in which the defendant may be found.</text> </paragraph>
<paragraph id="HAF7540104C5046678F8268ECCD3D983F"><enum>(5)</enum><header>Actions by other State officials</header>
<subparagraph id="H3B6F67DF78B747F986780D7254E85956"><enum>(A)</enum><text>Nothing contained in this section shall prohibit an authorized State official from proceeding in State court on the basis of an alleged violation of any civil or criminal statute of such State.</text> </subparagraph>
<subparagraph id="HB18190564CBF442FB502A69079E61C57"><enum>(B)</enum><text>In addition to actions brought by an attorney general of a State under paragraph (1), such an action may be brought by officers of such State who are authorized by the State to bring actions in such State on behalf of its residents.</text> </subparagraph></paragraph></subsection>
<subsection id="HB71CE0EF761B45109BA1E005CD1A0489"><enum>(d)</enum><header>Effect of Section</header><text>This section shall not apply to a person that is a registered exporter under section 804.</text> </subsection>
<subsection id="H220DAA6C1FBC4B1FAFE3815224ADD4C8"><enum>(e)</enum><header>General definitions</header><text>For purposes of this section:</text>
<paragraph id="HE4AB8624DB154C1AB9B66B17ECDFDA8E"><enum>(1)</enum><text>The term <term>practitioner</term> means a practitioner referred to in section 503(b)(1) with respect to issuing a written or oral prescription.</text> </paragraph>
<paragraph id="HC1090A1E66CA46668ACC1685D3B10CB7"><enum>(2)</enum><text>The term <term>prescription drug</term> means a drug that is described in section 503(b)(1).</text> </paragraph>
<paragraph id="H0AA43F6A048040A994627B22A14F04C2"><enum>(3)</enum><text>The term <term>qualifying medical relationship</term>, with respect to a practitioner and a patient, has the meaning indicated for such term in subsection (b).</text> </paragraph></subsection>
<subsection id="HC5C1370762004600BE122529071061A3"><enum>(f)</enum><header>Internet-Related definitions</header>
<paragraph id="HAB48BC1FEFDF4F3D9A500E7397773C79"><enum>(1)</enum><header>In general</header><text>For purposes of this section:</text>
<subparagraph id="H48B05ADFB8A743B0A74421E694E3FBEA"><enum>(A)</enum><text>The term <term>Internet</term> means collectively the myriad of computer and telecommunications facilities, including equipment and operating software, which comprise the interconnected world-wide network of networks that employ the transmission control protocol/internet protocol, or any predecessor or successor protocols to such protocol, to communicate information of all kinds by wire or radio.</text> </subparagraph>
<subparagraph id="H7332E7BECC95442F87552F16F907DF17"><enum>(B)</enum><text>The term <term>link</term>, with respect to the Internet, means one or more letters, words, numbers, symbols, or graphic items that appear on a page of an Internet site for the purpose of serving, when activated, as a method for executing an electronic command—</text>
<clause id="HB60C052BC6374705BCAA8FDF7F2143DA"><enum>(i)</enum><text>to move from viewing one portion of a page on such site to another portion of the page;</text> </clause>
<clause id="H4EABF5E8E29B41DA800B11781D002C8C"><enum>(ii)</enum><text>to move from viewing one page on such site to another page on such site; or</text> </clause>
<clause id="HDB27835E1DBB48A39FCBF8E4567D0128"><enum>(iii)</enum><text>to move from viewing a page on one Internet site to a page on another Internet site.</text> </clause></subparagraph>
<subparagraph id="H61D954A875F845FA91931444B884290A"><enum>(C)</enum><text>The term <term>page</term>, with respect to the Internet, means a document or other file accessed at an Internet site.</text> </subparagraph>
<subparagraph id="HB4ABC1CA014244E8A4E294146997AFFD"><enum>(D)</enum>
<clause commented="no" display-inline="yes-display-inline" id="HA5C73CF1A9444C548C77EDC8B6E08CEB"><enum>(i)</enum><text>The terms <term>site</term> and <term>address</term>, with respect to the Internet, mean a specific location on the Internet that is determined by Internet Protocol numbers. Such term includes the domain name, if any.</text> </clause>
<clause id="H29F2F357138C4E92A08D500829CE679E" indent="up1"><enum>(ii)</enum><text>The term <term>domain name</term> means a method of representing an Internet address without direct reference to the Internet Protocol numbers for the address, including methods that use designations such as <quote>.com</quote>, <quote>.edu</quote>, <quote>.gov</quote>, <quote>.net</quote>, or <quote>.org</quote>.</text> </clause>
<clause id="HF5603155BEA34A74A81F7CDD67276F97" indent="up1"><enum>(iii)</enum><text>The term <term>Internet Protocol numbers</term> includes any successor protocol for determining a specific location on the Internet.</text> </clause></subparagraph></paragraph>
<paragraph id="HA19B03C75EFA40F6885374DA53A7E091"><enum>(2)</enum><header>Authority of Secretary</header><text>The Secretary may by regulation modify any definition under paragraph (1) to take into account changes in technology.</text> </paragraph></subsection>
<subsection id="HB650F802504F40DF995CC82490EED0A0"><enum>(g)</enum><header>Interactive computer service; advertising</header><text>No provider of an interactive computer service, as defined in section 230(f)(2) of the <act-name parsable-cite="CA34">Communications Act of 1934</act-name> (47 U.S.C. 230(f)(2)), or of advertising services 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 such drugs, provided that the provider of the interactive computer service or of advertising services does not own or exercise corporate control over such person.</text> </subsection></section><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="HA75C108B381440999690E7E8FC42C7CB"><enum>(b)</enum><header>Inclusion as prohibited Act</header><text>Section 301 of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (21 U.S.C. 331) is amended by inserting after paragraph (k) the following:</text>
<quoted-block act-name="Federal Food, Drug, and Cosmetic Act" id="HCA17C7178E8346C6A32797CE5E313ECC">
<subsection id="H7B71C82C01A14373BD052C7B581380E7"><enum>(l)</enum><text>The dispensing or selling of a prescription drug in violation of section 503C.</text> </subsection><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="H59866F24040C45389BDA5AFBACEB53D8"><enum>(c)</enum><header>Internet sales of prescription drugs; consideration by Secretary of practices and procedures for certification of legitimate businesses</header><text>In carrying out section 503C of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name> (as added by subsection (a) of this section), the Secretary of Health and Human Services shall take into consideration the practices and procedures of public or private entities that certify that businesses selling prescription drugs through Internet sites are legitimate businesses, including practices and procedures regarding disclosure formats and verification programs.</text> </subsection>
<subsection id="HC754756358974D27975050C0ACB172DC"><enum>(d)</enum><header>Reports regarding Internet-Related violations of Federal and State laws on dispensing of drugs</header>
<paragraph id="H758880483EFF4FF494A06D919BFAC6CA"><enum>(1)</enum><header>In general</header><text>The Secretary of Health and Human Services (referred to in this subsection as the <quote>Secretary</quote>) shall, pursuant to the submission of an application meeting the criteria of the Secretary, make an award of a grant or contract to the National Clearinghouse on Internet Prescribing (operated by the Federation of State Medical Boards) for the purpose of—</text>
<subparagraph id="H50EC87B4C0F4410B8C1A59151AF3F6F4"><enum>(A)</enum><text>identifying Internet sites that appear to be in violation of Federal or State laws concerning the dispensing of drugs;</text> </subparagraph>
<subparagraph id="H563EA9B06E5749D697F1849989F591A8"><enum>(B)</enum><text>reporting such sites to State medical licensing boards and State pharmacy licensing boards, and to the Attorney General and the Secretary, for further investigation; and</text> </subparagraph>
<subparagraph id="H552828437BBF4A5EBA379A3B26F0300B"><enum>(C)</enum><text>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 subparagraph (A).</text> </subparagraph></paragraph>
<paragraph id="H22E055F3BC834721BC0001851623A1F5"><enum>(2)</enum><header>Authorization of appropriations</header><text>For the purpose of carrying out paragraph (1), there is authorized to be appropriated $100,000 for each of the first 3 fiscal years in which this section is in effect.</text> </paragraph></subsection>
<subsection id="H2FD729F080784E589D03CF84C0E4E4B7"><enum>(e)</enum><header>Effective date</header><text>The amendments made by subsections (a) and (b) take effect 90 days after the date of enactment of this Act, without regard to whether a final rule to implement such amendments has been promulgated by the Secretary of Health and Human Services under section 701(a) of the <act-name parsable-cite="FFDCA">Federal Food, Drug, and Cosmetic Act</act-name>. The preceding sentence may not be construed as affecting the authority of such Secretary to promulgate such a final rule.</text> </subsection></section>
<section id="H30F967A507EC4E31B95E15EBEEED259E"><enum>306.</enum><header>Prohibiting payments to unregistered foreign pharmacies</header>
<subsection id="H05DBC7263C0745F6B6AB75F006DF5488"><enum>(a)</enum><header>In general</header><text>Section 303 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 333) is amended by adding at the end the following:</text>
<quoted-block display-inline="no-display-inline" id="HF10242E8E445459F883EEEA2F908F984" style="OLC">
<subsection id="H3D907B2037D84185B7C58A0991A75C5C"><enum>(h)</enum><header>Restricted transactions</header>
<paragraph id="HD531C0E524AE40EAB49E587B3634050F"><enum>(1)</enum><header>In general</header><text>The introduction of restricted transactions into a payment system or the completion of restricted transactions using a payment system is prohibited.</text> </paragraph>
<paragraph id="H67FEAE944C0746E4B8D9B2DC8BFF4A6E"><enum>(2)</enum><header>Payment system</header>
<subparagraph id="HACBCA12D74E6473F8E1F014951565FD1"><enum>(A)</enum><header>In general</header><text>The term <term>payment system</term> means a system used by a person described in subparagraph (B) to effect a credit transaction, electronic fund transfer, or money transmitting service that may be used in connection with, or to facilitate, a restricted transaction, and includes—</text>
<clause id="H55F7C6ED160C427594C18E75825E454C"><enum>(i)</enum><text>a credit card system;</text> </clause>
<clause id="H0D37EEE692444ADAB1E2F6C56DBE6775"><enum>(ii)</enum><text>an international, national, regional, or local network used to effect a credit transaction, an electronic fund transfer, or a money transmitting service; and</text> </clause>
<clause id="H559F69E0E9E74711B25EB5C75D5EAC59"><enum>(iii)</enum><text>any other system that is centrally managed and is primarily engaged in the transmission and settlement of credit transactions, electronic fund transfers, or money transmitting services.</text> </clause></subparagraph>
<subparagraph id="H900B1416FF874067B1CF461080E3623B"><enum>(B)</enum><header>Persons described</header><text>A person referred to in subparagraph (A) is—</text>
<clause id="H05BDBD8309964B9EAAB837200CF8FCB1"><enum>(i)</enum><text>a creditor;</text> </clause>
<clause id="H7D984487337340FBB3188BFAAC48B495"><enum>(ii)</enum><text>a credit card issuer;</text> </clause>
<clause id="H6FF95754D5234C019359BB731FAEECC4"><enum>(iii)</enum><text>a financial institution;</text> </clause>
<clause id="HFC36353941654E64A5606BFDA104F9E4"><enum>(iv)</enum><text>an operator of a terminal at which an electronic fund transfer may be initiated;</text> </clause>
<clause id="HE89D61C18B5C4B27B8BCBC47B254C97D"><enum>(v)</enum><text>a money transmitting business; or</text> </clause>
<clause id="HFCBA184541A847C29DA7DEC9978CC450"><enum>(vi)</enum><text>a participant in an international, national, regional, or local network used to effect a credit transaction, electronic fund transfer, or money transmitting service.</text> </clause></subparagraph></paragraph>
<paragraph id="HA52A71B30C4E427D8C239F467C7EF22E"><enum>(3)</enum><header>Restricted transaction</header><text>The term <term>restricted transaction</term> means a transaction or transmittal, on behalf of an individual who places an unlawful drug importation request to any person engaged in the operation of an unregistered foreign pharmacy, of—</text>
<subparagraph id="HF93C932B6D17431CB29FE98DB73EF5B7"><enum>(A)</enum><text>credit, or the proceeds of credit, extended to or on behalf of the individual for the purpose of the unlawful drug importation request (including credit extended through the use of a credit card);</text> </subparagraph>
<subparagraph id="H4ED912792A1D4698A6534A324B4245A1"><enum>(B)</enum><text>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 for the purpose of the unlawful drug importation request;</text> </subparagraph>
<subparagraph id="HADA70879CCD14826ACB4522F042DB6AD"><enum>(C)</enum><text>a check, draft, or similar instrument which is drawn by or on behalf of the individual for the purpose of the unlawful drug importation request and is drawn on or payable at or through any financial institution; or</text> </subparagraph>
<subparagraph id="HBDC51072C677455F901947A08382689F"><enum>(D)</enum><text>the proceeds of any other form of financial transaction (identified by the Board by regulation) that involves a financial institution as a payor or financial intermediary on behalf of or for the benefit of the individual for the purpose of the unlawful drug importation request.</text> </subparagraph></paragraph>
<paragraph id="H404E13819CC148EA9A5732DDC8148406"><enum>(4)</enum><header>Unlawful drug importation request</header><text>The term <term>unlawful drug importation request</term> means the request, or transmittal of a request, made to an unregistered foreign 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.</text> </paragraph>
<paragraph id="H1F6D8BD8D4FC4D6D982161EF49630E15"><enum>(5)</enum><header>Unregistered foreign pharmacy</header><text>The term <term>unregistered foreign pharmacy</term> means a person in a country other than the United States that is not a registered exporter under section 804.</text> </paragraph>
<paragraph id="H26858C7759B54962B2119ED5554274CA"><enum>(6)</enum><header>Other definitions</header>
<subparagraph id="H34D4C16BBE344304B733D90115D9D4F8"><enum>(A)</enum><header>Credit; creditor; credit card</header><text>The terms <term>credit</term>, ‘creditor’, and <quote>credit card</quote> have the meanings given the terms in section 103 of the Truth in Lending Act (15 U.S.C. 1602).</text> </subparagraph>
<subparagraph id="H45D4DF1F2FA3454C8F8915D379463FCC"><enum>(B)</enum><header>Access device; electronic fund transfer</header><text>The terms <term>access device</term> and <term>electronic fund transfer</term>—</text>
<clause id="H7046C6F8884C41F995E8D047CBF61D32"><enum>(i)</enum><text>have the meaning given the term in section 903 of the Electronic Fund Transfer Act (15 U.S.C. 1693a); and</text> </clause>
<clause id="H5DF6B17BBCF64F84AF691C79B2A8CF4A"><enum>(ii)</enum><text>the term <term>electronic fund transfer</term> also includes any fund transfer covered under Article 4A of the Uniform Commercial Code, as in effect in any State.</text> </clause></subparagraph>
<subparagraph id="H2CFFE8CBEEB3474FB804E7BC9B0F1C0F"><enum>(C)</enum><header>Financial institution</header><text>The term <term>financial institution</term>—</text>
<clause id="HD828C09285924C009BD4FE95AED1837A"><enum>(i)</enum><text>has the meaning given the term in section 903 of the Electronic Transfer Fund Act (15 U.S.C. 1693a); and</text> </clause>
<clause id="H5D6D23D2D8F9498A92F80F75593900F9"><enum>(ii)</enum><text>includes a financial institution (as defined in section 509 of the Gramm-Leach-Bliley Act (15 U.S.C. 6809)).</text> </clause></subparagraph>
<subparagraph id="H50A464C6DE0F4A4A8B9E99E1A4EC54C3"><enum>(D)</enum><header>Money transmitting business; money transmitting service</header><text>The terms <term>money transmitting business</term> and <term>money transmitting service</term> have the meaning given the terms in section 5330(d) of title 31, United States Code.</text> </subparagraph>
<subparagraph id="HFDA0FFA36CD64977B06C428D6323E48A"><enum>(E)</enum><header>Board</header><text>The term <term>Board</term> means the Board of Governors of the Federal Reserve System.</text> </subparagraph></paragraph>
<paragraph id="H241746A12493416BA4DB53AAA5CC9575"><enum>(7)</enum><header>Policies and procedures required to prevent restricted transactions</header>
<subparagraph id="H7E6880E865DA40AD862F0DB9587D3141"><enum>(A)</enum><header>Regulations</header><text>The Board shall promulgate regulations requiring—</text>
<clause id="HCE97545F583C4673B2628BA1F6747F6E"><enum>(i)</enum><text>an operator of a credit card system;</text> </clause>
<clause id="H2A0AE75A129B42BB8045076DD13BBE7B"><enum>(ii)</enum><text>an operator of an international, national, regional, or local network used to effect a credit transaction, an electronic fund transfer, or a money transmitting service;</text> </clause>
<clause id="H501D8A5BF77D4454AA5459F6A748F2BC"><enum>(iii)</enum><text>an operator of any other payment system that is centrally managed and is primarily engaged in the transmission and settlement of credit transactions, electronic transfers or money transmitting services where at least one party to the transaction or transfer is an individual; and</text> </clause>
<clause id="HB06BE33690944AA99F5388DB4E39B76B"><enum>(iv)</enum><text>any other person described in paragraph (2)(B) and specified by the Board in such regulations,</text> </clause><continuation-text continuation-text-level="subparagraph">to establish policies and procedures that are reasonably designed to prevent the introduction of a restricted transaction into a payment system or the completion of a restricted transaction using a payment system.</continuation-text></subparagraph>
<subparagraph id="HAF73A0DF5B684021A8EFE5F73BAC07F3"><enum>(B)</enum><header>Requirements for policies and procedures</header><text>In promulgating regulations under subparagraph (A), the Board shall—</text>
<clause id="H75B30D597AC54D00BF533455B557033C"><enum>(i)</enum><text>identify types of policies and procedures, including nonexclusive examples, that shall be considered to be reasonably designed to prevent the introduction of restricted transactions into a payment system or the completion of restricted transactions using a payment system; and</text> </clause>
<clause id="HF225215A57244A28B428E79CA029EA66"><enum>(ii)</enum><text>to the extent practicable, permit any payment system, or person described in paragraph (2)(B), as applicable, to choose among alternative means of preventing the introduction or completion of restricted transactions.</text> </clause></subparagraph>
<subparagraph id="HFA6E77ECA7A848B5A4502E9F8909C462"><enum>(C)</enum><header>No liability for blocking or refusing to honor restricted transaction</header>
<clause id="H581659D75F5045FC8E5F8DC213EEDEF1"><enum>(i)</enum><header>In general</header><text>A payment system, or a person described in paragraph (2)(B) that is subject to a regulation issued under this subsection, and any participant in such payment system that prevents or otherwise refuses to honor transactions in an effort to implement the policies and procedures required under this subsection or to otherwise comply with this subsection shall not be liable to any party for such action.</text> </clause>
<clause id="H72993FCBFFCF4962A7E109FCCF7CA411"><enum>(ii)</enum><header>Compliance</header><text>A person described in paragraph (2)(B) meets the requirements of this subsection if the person relies on and complies with the policies and procedures of a payment system of which the person is a member or in which the person is a participant, and such policies and procedures of the payment system comply with the requirements of the regulations promulgated under subparagraph (A).</text> </clause></subparagraph>
<subparagraph id="H19D702482D0C4C4B8941BF50B2C89D06"><enum>(D)</enum><header>Enforcement</header>
<clause id="H216FF87AA45E4279A5A0279543541172"><enum>(i)</enum><header>In general</header><text>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 (15 U.S.C. 6805(a)).</text> </clause>
<clause id="HC9F69E59148D4DF792575562F67B7E92"><enum>(ii)</enum><header>Factors to be considered</header><text>In considering any enforcement action under this subsection against a payment system or person described in paragraph (2)(B), the Federal functional regulators and the Federal Trade Commission shall consider the following factors:</text>
<subclause id="H1B4B4534DDA24948A0624AB1F8697631"><enum>(I)</enum><text>The extent to which the payment system or person knowingly permits restricted transactions.</text> </subclause>
<subclause id="HD4481A611288443E9663AF2F04A02D4E"><enum>(II)</enum><text>The history of the payment system or person in connection with permitting restricted transactions.</text> </subclause>
<subclause id="HEFE8FBFAACBF418CB7514A4D7FF81D2A"><enum>(III)</enum><text>The extent to which the payment system or person has established and is maintaining policies and procedures in compliance with regulations prescribed under this subsection.</text> </subclause></clause></subparagraph></paragraph>
<paragraph id="H92B07194CF0146419AD931A1DBFB0349"><enum>(8)</enum><header>Transactions permitted</header><text>A payment system, or a person described in paragraph (2)(B) that is subject to a regulation issued under this subsection, is authorized to engage in transactions with foreign pharmacies in connection with investigating violations or potential violations of any rule or requirement adopted by the payment system or person in connection with complying with paragraph (7). A payment system, or such a person, and its agents and employees shall not be found to be in violation of, or liable under, any Federal, State or other law by virtue of engaging in any such transaction.</text> </paragraph>
<paragraph id="H97603BEC75834FB4A7D059D99A13935C"><enum>(9)</enum><header>Relation to State laws</header><text>No requirement, prohibition, or liability may be imposed on a payment system, or a person described in paragraph (2)(B) that is subject to a regulation issued under this subsection, under the laws of any State with respect to any payment transaction by an individual because the payment transaction involves a payment to a foreign pharmacy.</text> </paragraph>
<paragraph id="H78EB868C2DE34EA2842730E54BFD1C1B"><enum>(10)</enum><header>Timing of requirements</header><text>A payment system, or a person described in paragraph (2)(B) that is subject to a regulation issued under this subsection, must adopt policies and procedures reasonably designed to comply with any regulations required under paragraph (7) within 60 days after such regulations are issued in final form.</text> </paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="H02AEBAA4FAF4496E9493A5F93531D2BF"><enum>(b)</enum><header>Effective date</header><text>The amendment made by this section shall take effect on the day that is 90 days after the date of enactment of this Act.</text> </subsection>
<subsection id="H4FADF3803C974F5F91E1D1E6EF981C55"><enum>(c)</enum><header>Implementation</header><text>The Board of Governors of the Federal Reserve System shall promulgate regulations as required by subsection (h)(7) of section 303 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 333), as added by subsection (a), not later than 90 days after the date of enactment of this Act.</text> </subsection></section>
<section commented="no" display-inline="no-display-inline" id="H6EB5571D78E24BC6B9D1499CC9294B88" section-type="subsequent-section"><enum>307.</enum><header>Importation exemption under Controlled Substances Import and Export Act</header><text display-inline="no-display-inline">Section 1006(a)(2) of the Controlled Substances Import and Export Act (21 U.S.C. 956(a)(2)) is amended by striking <quote>not import the controlled substance into the United States in an amount that exceeds 50 dosage units of the controlled substance.</quote> and inserting <quote>import into the United States not more than 10 dosage units combined of all such controlled substances.</quote>.</text> </section>
<section commented="no" display-inline="no-display-inline" id="HB9151DC480F84AA4B7F137DC7FE89B31" section-type="subsequent-section"><enum>308.</enum><header>Severability</header><text display-inline="no-display-inline">If any provision of this Act, an amendment by this Act, or the application of such provision or amendment to any person or circumstance is held to be unconstitutional, the remainder of this Act, the amendments made by this Act, and the application of the provisions of such to any person or circumstance shall not affected thereby.</text> </section>
<enum>IV</enum><header>Additional prescription drugs provisions</header>
<section id="HA24A742CE3714996BB9C7CEC390F00C6" section-type="subsequent-section"><enum>401.</enum><header>Disallowance of deduction for advertising and promotional expenses for prescription pharmaceuticals</header>
<subsection id="HC8A630C7C86146289CFF4F85C65AE92E"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Part IX of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items not deductible) is amended by adding at the end the following new section:</text>
<quoted-block display-inline="no-display-inline" id="H66EBB4A8089A42799FA0FCA1E1BB53AC" style="OLC">
<section id="HA96472EE2FA54687A84F46A0819113DF"><enum>280I.</enum><header>Disallowance of deduction for prescription pharmaceuticals advertising and promotional expenses</header>
<subsection id="H24FF264C5A4F4FD1A99B00C08C9FD501"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">No deduction shall be allowed under this chapter for expenses relating to advertising or promoting the sale and use of prescription pharmaceuticals for any taxable year.</text> </subsection>
<subsection id="H6DC89F378BDC4C46BC1EAE96752BC084"><enum>(b)</enum><header>Advertising or promoting</header><text>For purposes of this section, the term <term>advertising or promoting</term> includes direct to consumer advertising in any media and any activity designed to promote the use of a prescription pharmaceutical directed to providers or others who may make decisions about the use of prescription pharmaceuticals (including the provision of product samples, free trials, and starter kits).</text> </subsection></section><after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="H21C95E8514604D3FA91F26FEF82AB3D9"><enum>(b)</enum><header>Conforming amendment</header><text>The table of sections for such part IX is amended by adding after the item relating to section 280H the following new item:</text>
<quoted-block id="H21DA719B2C064A84B222DA81E7ABBA4A" style="OLC">
<toc>
<toc-entry idref="HA96472EE2FA54687A84F46A0819113DF" level="section">Sec. 280I. Disallowance of deduction for prescription pharmaceuticals advertising and promotional expenses.</toc-entry> </toc> <after-quoted-block>.</after-quoted-block></quoted-block> </subsection>
<subsection id="H90DA2EAF67A94DD4B7024CDEC0E179D5"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act, in taxable years ending after such date.</text> </subsection></section>
<section commented="no" id="H278357560C88485583F33A914A11DB7A"><enum>402.</enum><header>Integrity for Pharmacy benefit managers</header>
<subsection commented="no" id="H902D73D8C49C42BF85D0B3BAA35C8D97"><enum>(a)</enum><header>Standards</header><text display-inline="yes-display-inline">A pharmacy benefit manager with a contract with a health benefits plan (as such term is defined in section 101) shall, with respect to such plan, comply with fiduciary standards established, by regulation, by the Secretary of Health and Human Services, that are consistent with the provisions of this section.</text> </subsection>
<subsection commented="no" id="H042276A59B174CA1B5367D7E8CCAC614"><enum>(b)</enum><header>Disclosure</header><text display-inline="yes-display-inline">Under such standards, a pharmacy benefit manager shall, upon request by the health benefits plan—</text>
<paragraph commented="no" id="HA260657F6B464856BCDF25B44A4AA987"><enum>(1)</enum><text>provide all available financial information to such plan regarding its enrollees; and</text> </paragraph>
<paragraph commented="no" id="H6EE84AE5F86C4E52AE8D9BDD06BCC962"><enum>(2)</enum><text>disclose to the sponsor of such plan all the rebates and other discounts that the pharmacy benefit manager receives from drug manufacturers, with respect to drugs dispensed to enrollees of such plan.</text> </paragraph></subsection>
<subsection commented="no" id="H942E9B549F0B41F38C6785B00B4D7E17"><enum>(c)</enum><header>Non-disclosure</header><text>A pharmacy benefit manager that is owned by, owns, or is otherwise affiliated with a retail pharmacy may not share with such affiliated retail pharmacy data on plan enrollees or other individuals that is obtained from claims submitted by other pharmacies.</text> </subsection>
<subsection commented="no" id="H6B4077C06568458DB8289159C6B3C0E8"><enum>(d)</enum><header>Notice of drug interchanges</header>
<paragraph commented="no" id="H85386FD29C2D486892E3A9DE5701E535"><enum>(1)</enum><header>In general</header><text>Under the standards under subsection (a), pharmacy benefit manager shall provide notice to a plan enrollee if the pharmacy benefit manager is switching the enrollee from a lower cost drug to a higher cost drug.</text> </paragraph>
<paragraph commented="no" id="HC60885218EF6443798E48205BFFAB55F"><enum>(2)</enum><header>Contents</header><text>Such notice shall contain—</text>
<subparagraph commented="no" id="HD3B3DE5F847C428197861C75A9BDB81F"><enum>(A)</enum><text>an explanation of the reason for the switch;</text> </subparagraph>
<subparagraph commented="no" id="HA4AFD9806366490984BD5772EFDD8B4B"><enum>(B)</enum><text>the difference in cost between the 2 drugs; and</text> </subparagraph>
<subparagraph commented="no" id="H74F54E0ED15542A08F7C173AF307DCC7"><enum>(C)</enum><text>whether a lower cost generic is available.</text> </subparagraph></paragraph></subsection>
<subsection commented="no" id="HD5C540ADBA164A8BB3D9A68C5DD4D008"><enum>(e)</enum><header>Additional disclosures</header><text display-inline="yes-display-inline">Under the standards under subsection (a), a pharmacy benefit manager shall disclose to the health benefits plan the actual reimbursement amount that is paid to the pharmacy for a prescription or service by the pharmacy benefit manager that is covered under such plan.</text> </subsection>
<subsection commented="no" id="H88C4FBD8164845B38C1C1B1E43B7BA86"><enum>(f)</enum><header>Equal Reimbursements for Mail order and Retail</header><text display-inline="yes-display-inline">Under the standards under subsection (a), a pharmacy benefit manager shall reimburse mail order and retail pharmacies at the same rates—</text>
<paragraph commented="no" display-inline="no-display-inline" id="HE5773D86DAD34A679D5D00985E4F39D2"><enum>(1)</enum><text>for identical prescription drugs; and</text> </paragraph>
<paragraph commented="no" id="H041EF3D302F64BF38CD415D6FBF4B00E"><enum>(2)</enum><text>for identical services.</text> </paragraph></subsection>
<subsection commented="no" id="HA56B66EFCA4D414196B18A1217641E81"><enum>(g)</enum><header>Elimination of Spread Pricing</header><text display-inline="yes-display-inline">Under the standards under subsection (a), with respect to a prescription drug that is covered by a health benefits plan and dispensed to a plan participant or beneficiary, a pharmacy benefit manager may not pay such pharmacy an amount that is less than the amount that is paid to the pharmacy benefit manager by such plan for such drug and any related dispensing fee.</text> </subsection>
<subsection commented="no" id="H4BC225F4D90F46E3AC735BD6ECA2E760"><enum>(h)</enum><header>Equal Copays</header><text display-inline="yes-display-inline">Under the standards under subsection (a), a pharmacy benefit manager may not require that a participant or beneficiary of a health benefits plan pay a different co-payment amount for a drug dispensed at a retail pharmacy, compared to the co-payment amount that would be charged to such participant or beneficiary for the same amount of that drug at a mail order pharmacy.</text> </subsection>
<subsection commented="no" id="HE21E4D0DA67A49C2B7011064E5B39CE9"><enum>(i)</enum><header>Computation of co-Payment amounts</header><text display-inline="yes-display-inline">Under the standards under subsection (a), a pharmacy benefit manager shall determine the co-payment amount charged a participant or beneficiary of a health benefits plan for a drug covered by the plan based on the amount that the plan or pharmacy benefit manager reimburses the pharmacy for such drug (including any applicable dispensing fee). Such co-payment amount may not be determined based on the amount that the plan pays to the pharmacy benefit manager for such drug.</text> </subsection>
<subsection commented="no" id="H2092206A26684DC5B4F249DB294F72A6"><enum>(j)</enum><header>Enforcement</header><text>In the regulations issued under subsection (a), the Secretary shall specify the sanctions which shall apply to health benefits plans and issuers of health insurance coverage under such plans that contract with pharmacy benefit managers that fail to comply with the standards under subsection (a). Such sanctions shall include the following:</text>
<paragraph commented="no" id="H6A870D142B594424B6D5A3EAA0A6552F"><enum>(1)</enum><header>Restriction on Federal contracting</header><text>The health benefits plan issuer shall not be eligible to contract with a Federal program, including Medicare under title XVIII of the Social Security Act and the Federal Employees Health Benefits Plan under chapter 89 of title 5, United States Code.</text> </paragraph>
<paragraph commented="no" id="H787D12D36A3C436A940C3CD15FDC8458"><enum>(2)</enum><header>Civil Monetary penalties</header><text>A health benefits plan or an issuer of such plan may be subject to a civil monetary penalty not to exceed $1,000.00 for each day that the pharmacy benefit manager is in an contract with the health benefits plan or issuer and such pharmacy benefit manager fails to comply with the standards under subsection (a).</text> </paragraph></subsection>
<subsection commented="no" id="HEAB6D554105F4109BCF61662327BC71F"><enum>(k)</enum><header>Pharmacy benefit manager defined</header><text>The term <term>pharmacy benefit manager</term> means any entity that provides pharmacy benefit management services on behalf of a health benefits plan.</text> </subsection>
<subsection commented="no" id="H1AF9D0E74CB942158B2DB530F4519620"><enum>(l)</enum><header>Effective date</header><text display-inline="yes-display-inline">This section shall take effect on January 1, 2011.</text> </subsection></section>
<section commented="no" id="H346547C8261945369FB1E40ABA2EA644"><enum>403.</enum><header>Price information under Medicaid</header>
<subsection commented="no" id="H6D5DF0A2E28B4D679AFBAA6BCB20F425"><enum>(a)</enum><header>Disclosure of information to the Secretary</header><text display-inline="yes-display-inline">Section 1927(b)(3) of such Act (42 U.S.C. 1396r–8(b)(3)) is amended—</text>
<paragraph commented="no" id="H49945D8C87BB4267AF22676B45B41EBF"><enum>(1)</enum><text>in subparagraph (A)—</text>
<subparagraph commented="no" id="H521776F87D724BE7AB0144D3FA9877E6"><enum>(A)</enum><text>in the first sentence, by inserting after clause (iii) the following clause:</text>
<quoted-block display-inline="no-display-inline" id="H48156A98CC4247F78880B3BF86EDBEF3" style="OLC">
<clause commented="no" id="H184D018F4CD643868F5420045E6076E4"><enum>(iv)</enum><text display-inline="yes-display-inline">not later than 30 days after the last day of each month of a rebate period under the agreement, on the manufacturer’s total number of units that are used to calculate the monthly average manufacturer price for each covered outpatient drug;</text> </clause><after-quoted-block>; and</after-quoted-block></quoted-block> </subparagraph>
<subparagraph commented="no" id="H71F749B254D648818460CB046484E416"><enum>(B)</enum><text>in the second sentence, by inserting ‘‘(relating to the weighted average of the most recently reported monthly average manufacturer prices)’’ after ‘‘(D)(v)’’; and</text> </subparagraph></paragraph>
<paragraph commented="no" id="HFD3DE5964C7B4AD4A94B0B5FABC8CF37"><enum>(2)</enum><text>in subparagraph (D)(v), by striking ‘‘average manufacturer prices’’ and inserting ‘‘the weighted average of the most recently reported monthly average manufacturer prices and the average retail survey price determined for each multiple source drug in accordance with subsection (f)’’.</text> </paragraph></subsection>
<subsection commented="no" id="H94BCB6433F3E4344A14A16F4DCBA0D1B"><enum>(b)</enum><header>Clarification of application of survey of retail prices</header><text>Section 1927(f)(1) of such Act (4222 U.S.C. 1396r–8(b)(1)) is amended—</text>
<paragraph commented="no" id="H9E2122DE026A44789ED89F0609DC440C"><enum>(1)</enum><text>in subparagraph (A)(i), by inserting ‘‘with respect to a retail community pharmacy,’’ before ‘‘the determination’’; and</text> </paragraph>
<paragraph commented="no" id="HCD04C4A3A84B4697AE579ABC5C2C0034"><enum>(2)</enum><text>in subparagraph (C)(ii), by striking ‘‘retail pharmacies’’ and inserting ‘‘retail community pharmacies’’.</text> </paragraph></subsection>
<subsection commented="no" id="HC09FFE942572444D8A862EAFB1B2BB37"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall take effect on the first day of the first calendar year quarter that begins at least 180 days after the date of enactment of this Act, without regard to whether or not final regulations to carry out such amendments have been promulgated by such date.</text> </subsection></section>