[Congressional Record Volume 140, Number 82 (Friday, June 24, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: June 24, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. PRYOR (for himself and Mr. Sasser):
  S. 2239. A bill to implement pharmaceutical marketplace reform, and 
for other purposes; to the Committee on Finance.


           the pharmaceutical marketplace reform act of 1994

  Mr. PRYOR. Mr. President, today, along with the distinguished Senator 
from Tennessee [Mr. Sasser], I am introducing comprehensive legislation 
that will ensure that older Americans pay fair prices for vital 
prescription medications. I am introducing the Pharmaceutical 
Marketplace Reform Act of 1994. For the past 5 years as chairman of the 
Special Committee on Aging, I have focused much of my attention on 
prescription drug prices. I have particularly studied the impact of 
rapidly escalating medication prices on older Americans. I have recited 
over and over again these very disturbing statistics for my colleagues:
  For three out of four older Americans, prescription drugs are their 
highest out-of-pocket medical cost;
  In order to meet the costs of prescription drugs, 13 percent of older 
Americans have had to go without food;
  Nearly half of all older Americans completely lack coverage for 
payment of their prescription drugs;
  Drug manufacturers charge citizens of other industrialized nations 
much lower prices for their prescription drugs. In fact, a recent 
General Accounting Office report found that citizens of the United 
Kingdom pay 60 percent less for the same drugs purchased by citizens of 
the United States.
  But now, Mr. President, the time for talk is over, and the time for 
action is upon us. In this very important year of health care reform, 
we can finally ensure that, once and for all, Americans pay fair prices 
for medications. Let me state that I support a market-based approach to 
containing drug costs. And, the key to an efficient marketplace is 
good, up-to-date information.
  Unfortuantely, information about drug costs has been sorely lacking 
in our health care system. Therefore, this bill will ensure that all 
purchasers of prescription drugs--Medicare, Medicaid, HMO's, hospitals, 
community pharmacies, chain pharmacies, and others--are given the 
information that they need to make good purchasing decisions.
  I can predict the reaction of the drug industry to this bill. They 
will call this bill, like they call any other bill that attempts to 
inject fairness into the prescription drug market, movement toward 
price controls. Let me make it clear that this bill does not impose any 
price controls on drugs. In fact, I have said time and time again that 
I do not believe that price controls work.

  When market economics proves effective in containing drug costs, I 
believe the market should be allowed to function on its own. However, 
when the market fails to restore skyrocketing drug prices to a stable 
equilibrium, I believe that we have a responsibility to ensure that 
drugs are priced reasonably and fairly for people who depend on 
medications.
  I have not been convinced that the market can work to contain drug 
costs, and particularly the costs of new, breakthrough drugs. Because 
generic substitutes for these kinds of drugs do not exist, forces of 
competition that typically work to contain prices are ineffective. We 
therefore need another way to ensure that these drugs are priced 
reasonably. This bill will provide information to buyers about these 
new, breakthrough medications so that more informed purchasing 
decisions can be made.
  In addition, the drug industry has refused to negotiate discounts or 
price breaks with large community and chain pharmacy buying groups. 
While a hospital of HMO will pay $1 for an inhaler, a community 
pharmacy might pay $20 for the very same product. This is market 
distortion at its worst, since many of these community pharmacy buying 
groups purchase millions of dollars worth of drugs each year. This bill 
would try to address this type of distortion of the market.
  The legislation also recognizes the expanded role that pharmacists 
should have in any reformed health care system. Pharmacists are the 
most underused health professionals in our Nation. In OBRA 90 we 
recognized the pharmacists' role in educating Medicaid recipients on 
how to use their medications properly. This was a good start. This bill 
would provide that all health care plans--including Medicare--make 
patient counseling and other pharmacy services an integral part of the 
benefits that they offer.
  Mr. President, I know that we have many twists and turns in the long 
road ahead toward health care reform. No one said that it would be 
easy. But I want to work with my colleagues on enacting a major health 
care reform bill this year. I hope that the proposals put forth in this 
legislation provide some food for thought to my colleagues as we move 
through the health reform process and make important decisions about 
pharmaceutical coverage. I encourage my colleagues to review the bill, 
and join me in cosponsoring this important legislation.
  Mr. President, I ask unanimous consent that the text of the bill and 
a summary be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 2239

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

     SECTION 1. SHORT TITLE; REFERENCE TO ACT; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the 
     ``Pharmaceutical Marketplace Reform Act of 1994''.
       (b) Amendments to Social Security Act.--Except as otherwise 
     specifically provided, whenever in this Act an amendment is 
     expressed in terms of an amendment to or repeal of a section 
     or other provision, the reference shall be considered to be 
     made to that section or other provision of the Social 
     Security Act.
       (c) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; reference to Act; table of contents.
Sec. 2. Findings.
Sec. 3. Purposes.

                       TITLE I--MEDICARE PROGRAM

     Subtitle A--Covered Outpatient Prescription Drugs and Rebates

Sec. 101. Covered outpatient prescription drugs.
Sec. 102. Rebates for covered outpatient drugs.

                      Subtitle B--Drug Use Review

Sec. 111. Medicare drug use review.

                       Subtitle C--Effective Date

Sec. 121. Effective date.

                       TITLE II--MEDICAID PROGRAM

Sec. 201. No Federal financial participation with respect to certain 
              innovator multiple source drugs.
Sec. 202. Rebate for certain covered outpatient drugs.
Sec. 203. State regulation of outpatient prescription drug benefits 
              covered by health care plans.

                         TITLE III--COMMISSIONS

Sec. 301. Pharmaceutical Marketplace Information Commission.
Sec. 302. Prescription Drug Payment Review Commission.

              TITLE IV--ADDITIONS TO THE MASTER AGREEMENT

Sec. 401. Equal access to discounts.
Sec. 402. Provision of information to the Pharmaceutical Marketplace 
              Information Commission.
Sec. 403. Conforming amendments.
Sec. 404. Effective date.

     SEC. 2. FINDINGS.

       The Congress finds that--
       (1) any medicare outpatient prescription drug benefit 
     should be structured to take advantage of market forces and 
     should use the same principles as other managed care pharmacy 
     benefit programs;
       (2) there is a lack of information in the health care 
     system about the price and quality of pharmaceutical 
     products, resulting in a significant level of market 
     distortions and a lack of price competition;
       (3) the availability of more information about price and 
     quality of medications would make the pharmaceutical 
     marketplace more competitive, and minimize the need for more 
     regulatory pharmaceutical cost containment mechanisms;
       (4) in the absence of competing new pharmaceutical products 
     in the market, there is a need for the health care system to 
     have information about the price of new pharmaceutical 
     products to assure that the prices are reasonable;
       (5) price concessions and discounting offered by 
     pharmaceutical manufacturers have not been offered on equal 
     terms to all purchasers, resulting in higher prices for 
     pharmaceutical products at the retail level, and ultimately 
     for consumers; and
       (6) under health care reform, all Americans should have 
     access to high quality drug use review and coordinated 
     pharmaceutical care services.

     SEC. 3. PURPOSES.

       The purposes of this Act are--
       (1) to establish the medicare outpatient prescription drug 
     program as a pharmaceutical care benefit using principles of 
     managed care;
       (2) to improve the quality and timeliness of information 
     provided in the health care marketplace about the relative 
     price and value of currently marketed and new pharmaceutical 
     products;
       (3) to assure that prices for new breakthrough 
     pharmaceutical products in the United States are reasonable;
       (4) to provide that all pharmaceutical buyers have access 
     to manufacturer price discounts and concessions on equal 
     terms and conditions; and
       (5) to assure that drug use review and pharmaceutical care 
     becomes an integral part of the delivery of prescription 
     drugs in health care programs.
                       TITLE I--MEDICARE PROGRAM
     Subtitle A--Covered Outpatient Prescription Drugs and Rebates

     SEC. 101. COVERED OUTPATIENT PRESCRIPTION DRUGS.

       (a) Covered Outpatient Drugs as Medical and Other Health 
     Services.--
       (1) In general.--Section 1861(s)(2)(J) (42 U.S.C. 
     1395x(s)(2)(J)) is amended to read as follows:
       ``(J) covered outpatient drugs;''.
       (2) Definition of covered outpatient drugs.--Section 
     1861(t) (42 U.S.C. 1395x(t)), as amended by section 13553(b) 
     of the Omnibus Budget Reconciliation Act of 1993 (hereafter 
     in this subtitle referred to as ``OBRA-1993''), is amended--
       (A) in the heading, by adding at the end the following: ``; 
     Covered Outpatient Drugs'';
       (B) in paragraph (1), by striking ``paragraph (2)'' and 
     inserting ``the succeeding paragraphs of this subsection''; 
     and
       (C) by inserting after paragraph (2) the following new 
     paragraph:
       ``(3) The term `covered outpatient drugs' means--
       ``(A) drugs and biologicals (which cannot, as determined in 
     accordance with regulations, be self-administered) furnished 
     as incident to a physician's professional service, of kinds 
     which are commonly furnished in physicians' offices and are 
     commonly either rendered without charge or included in the 
     physician's bill;
       ``(B) prescription drugs used in immunosuppressive therapy 
     furnished to an individual who receives an organ transplant 
     for which payment is made under this title, but only in the 
     case of drugs furnished--
       ``(i) before 1995, within 12 months after the date of the 
     transplant procedure,
       ``(ii) during 1995, within 18 months after the date of the 
     transplant procedure,
       ``(iii) during 1996, within 24 months after the date of the 
     transplant procedure,
       ``(iv) during 1997, within 30 months after the date of the 
     transplant procedure, and
       ``(v) during any year after 1997, within 36 months after 
     the date of the transplant procedure;
       ``(C) erythropoietin--
       ``(i) for dialysis patients competent to use such drug 
     without medical or other supervision with respect to the 
     administration of such drug, subject to methods and standards 
     established by the Secretary by regulation for the safe and 
     effective use of such drug; and
       ``(ii) administered in a renal dialysis facility.
       ``(D) an oral drug (which is approved by the Federal Food 
     and Drug Administration) prescribed for use as an anticancer 
     chemotherapeutic agent for a given indication, and containing 
     an active ingredient (or ingredients), which is the same 
     indication and active ingredient (or ingredients) as a drug 
     which the carrier determines would be covered pursuant to 
     subparagraph (A) or section 1861(s)(2)(B) if the drug could 
     not be self-administered; and
       ``(E) any other outpatient drug or biological described in 
     section 1927(k) for which payment may be specially 
     allowed.''.
       (3) Conforming amendments.--(A) Section 1861(s)(2) (42 
     U.S.C. 1395x(s)(2)), as amended by section 13553 of OBRA-
     1993, is amended--
       (i) in subparagraph (A), by striking ``(including drugs and 
     biologicals which cannot, as determined in accordance with 
     regulations, be self-administered)'',
       (ii) by adding ``and'' at the end of subparagraph (O),
       (iii) by amending subparagraph (P) to read as follows:
       ``(P) items related to the administration of 
     erythropoietin.'', and
       (iv) by striking subparagraph (Q).
       (B) Section 1881(b)(1)(C) (42 U.S.C. 1395rr(b)(1)(C)), as 
     amended by section 13566(a) of OBRA-1993, is amended by 
     striking ``section 1861(s)(2)(P)'' and inserting ``section 
     1861(t)(3)(C)(i)''.
       (b) Addition of Medicare to Master Plan Requirements.--
     Section 8126(a)(4) of title 38, United States Code, is 
     amended--
       (1) by striking ``or'' at the end of subparagraph (B);
       (2) by striking the period at the end of subparagraph (C) 
     and inserting ``, or''; and
       (3) by adding at the end the following new subparagraph:
       ``(D) the medicare program under title XVIII of the Social 
     Security Act.''.

     SEC. 102. REBATES FOR COVERED OUTPATIENT DRUGS.

       (a) In General.--Part B of title XVIII is amended by adding 
     at the end the following new section:


                 ``rebates for covered outpatient drugs

       ``Sec. 1849. (a) Requirement for Rebate Agreement.--In 
     order for payment to be available under this part for a 
     covered outpatient drug of a manufacturer dispensed on or 
     after January 1, 1995, the manufacturer must have entered 
     into and have in effect a rebate agreement with the Secretary 
     meeting the requirements of subsection (b).
       ``(b) Terms, Implementation, and Enforcement of Rebate 
     Agreement.--
       ``(1) Periodic rebates.--
       ``(A) In general.--A rebate agreement under this section 
     shall require the manufacturer to pay to the Secretary for 
     each calendar quarter, not later than 30 days after the date 
     of receipt of the information described in paragraph (2) for 
     such quarter, a rebate in an amount determined under 
     subsection (c) for all covered outpatient drugs of the 
     manufacturer described in subparagraph (B).
       ``(B) Drugs included in quarterly rebate calculation.--
     Drugs subject to rebate with respect to a calendar quarter 
     are covered outpatient drugs which are dispensed by a 
     pharmacy during such quarter to individuals (other than 
     individuals enrolled with an eligible organization with a 
     contract under section 1876) eligible for benefits under this 
     part, as reported by such pharmacies to the Secretary.
       ``(2) Information furnished to manufacturers.--
       ``(A) In general.--The Secretary shall report to each 
     manufacturer, not later than 60 days after the end of each 
     calendar quarter, information on the total number, for each 
     covered outpatient drug, of units of each dosage form, 
     strength, and package size dispensed under the plan during 
     the quarter, on the basis of the data described in paragraph 
     (1)(B) reported to the Secretary.
       ``(B) Audit.--The Comptroller General may audit the records 
     of the Secretary to the extent necessary to determine the 
     accuracy of reports by the Secretary pursuant to subparagraph 
     (A). Adjustments to rebates shall be made to the extent 
     determined necessary by the audit to reflect actual units of 
     drugs dispensed.
       ``(3) Provision of price information by manufacturer.--
       ``(A) Quarterly pricing information.--Each manufacturer 
     with an agreement in effect under this section shall report 
     to the Secretary, not later than 30 days after the last day 
     of each calendar quarter, on the average manufacturer retail 
     price for each dosage form and strength of each covered 
     outpatient drug for the quarter.
       ``(B) Base quarter prices.--Each manufacturer of a covered 
     outpatient drug with an agreement under this section shall 
     report to the Secretary, by not later than 30 days after the 
     effective date of such agreement (or, if later, 30 days after 
     the end of the base quarter), the average manufacturer retail 
     price, for such base quarter, for each dosage form and 
     strength of each such covered outpatient drug.
       ``(C) Verification of average manufacturer retail price.--
     The Secretary may inspect the records of manufacturers, and 
     survey wholesalers, pharmacies, and institutional purchasers 
     of drugs, as necessary to verify prices reported under 
     subparagraph (A).
       ``(D) Penalties.--
       ``(i) Civil money penalties.--The Secretary may impose a 
     civil money penalty on a manufacturer with an agreement under 
     this section--

       ``(I) for failure to provide information required under 
     subparagraph (A) on a timely basis, in an amount up to 
     $10,000 per day of delay;
       ``(II) for refusal to provide information about charges or 
     prices requested by the Secretary for purposes of 
     verification pursuant to subparagraph (C), in an amount up to 
     $100,000; and
       ``(III) for provision, pursuant to subparagraph (A) or (B), 
     of information that the manufacturer knows or should know is 
     false, in an amount up to $100,000 per item of information.

     Such civil money penalties are in addition to any other 
     penalties prescribed by law. The provisions of section 1128A 
     (other than subsections (a) (with respect to amounts of 
     penalties or additional assessments) and (b)) shall apply to 
     a civil money penalty under this subparagraph in the same 
     manner as such provisions apply to a penalty or proceeding 
     under section 1128A(a).
       ``(ii) Suspension of agreement.--If a manufacturer with an 
     agreement under this section has not provided information 
     required under subparagraph (A) or (B) within 90 days of the 
     deadline imposed, the Secretary may suspend the agreement 
     with respect to covered outpatient drugs dispensed after the 
     end of such 90-day period and until the date such information 
     is reported (but in no case shall a suspension be for less 
     than 30 days).
       ``(4) Length of agreement.--
       ``(A) In general.--A rebate agreement shall be effective 
     for an initial period of not less than one year and shall be 
     automatically renewed for a period of not less than one year 
     unless terminated under subparagraph (B).
       ``(B) Termination.--
       ``(i) By the secretary.--The Secretary may provide for 
     termination of a rebate agreement for violation of the 
     requirements of the agreement or other good cause shown. Such 
     termination shall not be effective earlier than 60 days after 
     the date of notice of such termination. The Secretary shall 
     afford a manufacturer an opportunity for a hearing concerning 
     such termination, but such hearing shall not delay the 
     effective date of the termination.
       ``(ii) By a manufacturer.--A manufacturer may terminate a 
     rebate agreement under this section for any reason. Any such 
     termination shall not be effective until the calendar quarter 
     beginning at least 60 days after the date the manufacturer 
     provides notice to the Secretary.
       ``(iii) Effective date of termination.--Any termination 
     under this subparagraph shall not affect rebates due under 
     the agreement before the effective date of its termination.
       ``(iv) Notice to pharmacies.--In the case of a termination 
     under this subparagraph, the Secretary shall notify 
     pharmacies and physician organizations not less than 30 days 
     before the effective date of such termination.
       ``(c) Amount of Rebate.--
       ``(1) Basic rebate.--Each manufacturer shall remit a basic 
     rebate to the Secretary for each calendar quarter in an 
     amount, with respect to each dosage form and strength of a 
     covered outpatient drug (except as provided under paragraph 
     (5)), equal to the product of--
       ``(A) the total number of units subject to rebate for such 
     quarter, as described in subsection (b)(1)(B); and
       ``(B) the greater of--
       ``(i)(I) in the case of a single source and innovator 
     multiple source drugs (as defined in section 1927(k)(7)), 17 
     percent of the average manufacturer retail price for the 
     calendar quarter;
       ``(II) in the case of a noninnovator multiple source drug 
     (as defined in section 1927(k)(7)) that has an average 
     manufacturer retail price which is greater than 50 percent of 
     the average manufacturer retail price of the corresponding 
     innovator multiple source drug, 11 percent of the average 
     manufacturer retail price for such noninnovator multiple 
     source drug for the calendar quarter;
       ``(ii) the amount determined pursuant to paragraph (2); or
       ``(iii) the amount determined pursuant to paragraph (3).
       ``(2) Negotiated rebate amount for new drugs.--
       ``(A) In general.--The Secretary may negotiate with the 
     manufacturer a per-unit rebate amount, in accordance with 
     this paragraph, for any covered outpatient drug (except as 
     provided under paragraph (5)) first marketed after June 30, 
     1993, if one of the following criteria apply:
       ``(i) The medicare program will be a primary payer for the 
     drug or biological in the outpatient market or will incur 
     significant expenditures for the drug or biological.
       ``(ii) The Drug Use Review Board (established under section 
     1850(b)) determined that the drug (whether or not a new 
     chemical entity) is a significant clinical or therapeutic 
     advance over other drugs on the market to treat a particular 
     medical condition.
       ``(iii) The manufacturer has provided insufficient evidence 
     to the Drug Use Review Board that the drug is cost-effective 
     at the current price charged by the manufacturer.
       ``(iv) The price of the drug is higher in other 
     industrialized nations as compared with the price in the 
     United States.
       ``(v) The Federal Government had a substantial role in the 
     research and development of the drug.
       ``(B) Agreement to negotiate rebate for subsequent new 
     drugs.--Any manufacturer entering into an agreement with the 
     Secretary under this paragraph for any covered outpatient 
     drug shall agree to enter into good-faith negotiations for 
     the rebate amount under this paragraph for any other covered 
     outpatient drug which is first marketed after such drug.
       ``(C) Option to exclude or limit coverage.--If the 
     Secretary is unable to negotiate with the manufacturer an 
     acceptable rebate amount with respect to a covered outpatient 
     drug pursuant to this paragraph, the Secretary may--
       ``(i) exclude such drug from coverage under this part; or
       ``(ii) limit the use of the drug based on treatment or 
     protocol guidelines (as recommended by the Drug Use Review 
     Board).
       ``(D) Effective date of exclusion or limitation from 
     coverage.--An exclusion or limitation of a drug pursuant to 
     subparagraph (C) shall be effective on and after the earlier 
     of--
       ``(i) the date 6 months after the effective date of 
     marketing approval of such drug by the Food and Drug 
     Administration (but in no event earlier than July 1, 1996), 
     or
       ``(ii) the date the manufacturer terminates negotiations 
     with the Secretary concerning the rebate amount.
       ``(3) Higher negotiated rebates.--The Secretary shall have 
     the authority to negotiate with a manufacturer a per-unit 
     rebate amount on an annual basis for any covered outpatient 
     drug (except as provided under paragraph (5)) that is greater 
     than the per unit rebate amount determined under clause (I) 
     or (II) of paragraph (1)(B)(i).
       ``(4) Additional rebate.--Each manufacturer shall remit to 
     the Secretary, for each calendar quarter, an additional 
     rebate for each dosage form and strength of a covered 
     outpatient drug (except as provided under paragraph (5)), in 
     an amount equal to--
       ``(A) the total number of units subject to rebate for such 
     quarter, as described in subsection (b)(1)(B), multiplied by
       ``(B) the amount (if any) by which--
       ``(i) the average manufacturer retail price for the covered 
     drug of the manufacturer, exceeds
       ``(ii) the average manufacturer retail price of the covered 
     drug for the base quarter, increased by the percentage by 
     which the Consumer Price Index for all urban consumers 
     (United States city average) for the month before the month 
     in which the calendar quarter begins exceeds such index for 
     the last month of the base quarter.
       ``(5) No rebate required for certain generic drugs.--
     Paragraphs (1) through (4) shall not apply with respect to a 
     covered outpatient drug that is a noninnovator multiple 
     source drug which is not described in paragraph 
     (1)(B)(i)(II).
       ``(6) Deposit of rebates.--The Secretary shall deposit 
     rebates under this section in the Federal Supplementary 
     Medical Insurance Trust Fund established under section 1841.
       ``(d) Confidentiality of Information.--Notwithstanding any 
     other provision of law, information disclosed by a 
     manufacturer under this section is confidential and shall not 
     be disclosed by the Secretary, except--
       ``(1) as the Secretary determines to be necessary to carry 
     out this section,
       ``(2) to permit the Comptroller General to review the 
     information provided, and
       ``(3) to permit the Director of the Congressional Budget 
     Office to review the information provided.
       ``(e) Generic Dispensing Incentives.--
       ``(1) Establishment of dispensing policy.--The Secretary 
     shall establish a generic-only dispensing policy for any drug 
     described in subparagraph (A), subject to Federal upper limit 
     for each such drug described in subparagraph (B), which shall 
     ensure that expenditures for innovator multiple source drugs 
     (determined after taking into account any rebates with 
     respect to such drugs under this section) account for no more 
     than 10 percent of the total expenditures made under this 
     part for multiple source drugs (determined after taking into 
     account any rebates with respect to such drugs under this 
     section).
       ``(A) Generic-only policy applicable.--A drug described in 
     this paragraph is any covered outpatient drug which is a 
     multiple source drug (as defined in section 1927(k)(7)) for 
     which there are three or more therapeutically and 
     pharmaceutically equivalent brands of the drug sold and 
     marketed in the United States.
       ``(B) Federal upper limit.--The Secretary shall establish a 
     Federal upper limit for each drug described in subparagraph 
     (A) by using the prices of each of the therapeutically and 
     pharmaceutically equivalent brands of such drug that is sold 
     and marketed in the United States.
       ``(2) Description of generics-only policy.--The Secretary 
     shall exclude from payment under section 1862(a)(17) any 
     innovator version of a multiple source drug described in 
     paragraph (1)(A) unless--
       ``(A) a written prescription for the drug contains, in the 
     handwriting of the physician or other person prescribing the 
     drug, the phrase `brand medically necessary' indicating that 
     the particular brand of the innovator drug product must be 
     dispensed; and
       ``(B) at the option of the Secretary, a medical 
     justification is provided for the covered outpatient drug 
     described in subparagraph (A).

     The Secretary may require prior authorization for payment for 
     any innovator version of a multiple source drug described in 
     paragraph (1)(A) unless the net cost of the innovator 
     multiple source drug to the program under this part is less 
     than or equal to the Federal upper limit (as established by 
     the Secretary under paragraph (1)(B)).
       ``(3) Publication of information.--The Secretary shall 
     publish on no less than a semiannual basis a prescription 
     resource guide for physicians and pharmacists for the 
     outpatient prescription drugs most commonly prescribed for 
     medicare beneficiaries. The guide would indicate when 
     generics are available for a particular brand name drug and 
     indicate the net cost to the medicare program for the 
     furnishing of each drug in the therapeutic class of such 
     drug. Such information shall also be available on any 
     electronic claims prescription processing system established 
     by the Secretary.
       ``(f) Prior Authorization Program.--The Secretary may 
     establish, as a condition of coverage or payment for a 
     covered outpatient drug for which payment is available under 
     this part, a system which requires the approval of the drug 
     before its dispensing for any medically accepted indication 
     (as defined in section 1927(k)(6)) but the system providing 
     for such approval must--
       ``(A) provide a response by telephone or other 
     telecommunication device within 24 hours of a request for 
     prior authorization; and
       ``(B) provide for the dispensing of at least a 72-hour 
     supply of a covered outpatient prescription drug in an 
     emergency situation (as defined by the Secretary).
       ``(g) Definitions.--For purposes of this section:
       ``(1) Average manufacturer retail price.--The term `average 
     manufacturer retail price' means, with respect to a covered 
     outpatient drug of a manufacturer for a calendar quarter, the 
     average price (inclusive of discounts for cash payment, 
     prompt payment, volume purchases, and rebates (other than 
     rebates under this section), but exclusive of nominal prices) 
     paid to the manufacturer for the drug in the United States 
     for drugs distributed to the retail pharmacy class of trade.
       ``(2) Base quarter.--The term `base quarter' means, with 
     respect to a covered outpatient drug of a manufacturer, the 
     calendar quarter beginning October 1, 1993, or, if later, the 
     first full calendar quarter during which the drug was 
     marketed in the United States.
       ``(3) Manufacturer.--The term `manufacturer' means, with 
     respect to a covered outpatient drug, the entity holding 
     legal title to or possession of the National Drug Code number 
     for such drug.
       ``(4) Nominal price.--The term `nominal price' means any 
     price which is less than 10 percent of the average 
     manufacturer's retail price for the covered outpatient drug 
     of the manufacturer for the calendar quarter.''.
       (b) Exclusions From Coverage.--Section 1862(a) (42 U.S.C. 
     1395y(a)) is amended--
       (1) by striking ``or'' at the end of paragraph (15),
       (2) by striking the period at the end of paragraph (16) and 
     inserting ``; or'', and
       (3) by inserting after paragraph (16) the following new 
     paragraph:
       ``(17) in the case of a covered outpatient drug (as 
     described in section 1861(t)) which--
       ``(A) is furnished during a year for which the drug's 
     manufacturer does not have in effect a rebate agreement with 
     the Secretary that meets the requirements of section 1849 for 
     the year,
       ``(B) is excluded from coverage during the year by the 
     Secretary pursuant to subparagraphs (C) and (D) of section 
     1849(c)(2) (relating to negotiated rebate amounts for certain 
     new drugs), or
       ``(C) is not furnished in accordance with treatment 
     protocols developed by the Secretary (based on 
     recommendations from the Drug Use Review Board)''.
       (c) Conforming Amendments to Medicaid Program.--Section 
     1927(a) (42 U.S.C. 1396r-8(a)) is amended--
       (1) in the first sentence of paragraph (1), by striking 
     ``and paragraph (6)'' and inserting ``, paragraph (6), and 
     (for calendar quarters beginning on or after January 1, 1995) 
     paragraph (7)''; and
       (2) by adding at the end the following new paragraph:
       ``(7) Requirement relating to rebate agreements for covered 
     outpatient drugs under medicare program.--A manufacturer 
     meets the requirements of this paragraph if the manufacturer 
     has in effect an agreement with the Secretary under section 
     1849 for providing rebates for covered outpatient drugs 
     furnished to individuals under title XVIII during the 
     year.''.
                      Subtitle B--Drug Use Review

     SEC. 111. MEDICARE DRUG USE REVIEW.

       Part B of title XVIII is further amended by adding at the 
     end the following new section:


                       ``medicare drug use review

       ``Sec. 1850. (a) Drug Use Review.--
       ``(1) Establishment.--
       ``(A)  In general.--Except as provided in subparagraph (C), 
     the Secretary shall provide, by not later than January 1, 
     1996, for a drug use review program for covered outpatient 
     drugs which--
       ``(i) meets the requirements of paragraph (2), and
       ``(ii) assures that prescriptions for covered outpatient 
     drugs are appropriate, medically necessary, and not likely to 
     result in adverse medical results.
       ``(B) Drug use review allowance.--Not later than 180 days 
     after the date of the enactment of the Pharmaceutical 
     Marketplace Reform Act of 1994, the Secretary shall establish 
     a methodology to provide payment to pharmacists for 
     prospective drug review and pharmaceutical care activities 
     required under subparagraphs (A) through (H) of paragraph 
     (2).
       ``(C) Treatment of nursing facilities.--The Secretary is 
     not required to provide for drug use review with respect to 
     drugs dispensed to residents of nursing facilities which are 
     in compliance with the requirements of subsections 
     (b)(4)(A)(iii) and (c)(1)(D) of section 1819.
       ``(2) Requirements of program.--
       ``(A) Prospective drug use review.--
       ``(i) In general.--The drug use review program shall 
     provide for a review of drug therapy before each prescription 
     for a covered outpatient drug is filled or delivered to an 
     individual receiving a covered outpatient drug. The review 
     shall be designed to identify potential drug therapy problems 
     due to therapeutic duplication, drug-disease 
     contraindications, drug interactions (including serious 
     interactions with nonprescription or over-the-counter drugs), 
     incorrect drug dosage or duration of drug treatment, drug-
     allergy interactions, and clinical abuse or misuse.
       ``(ii) Standards for counseling by pharmacists.--As part of 
     the prospective drug use review program, the Secretary (in 
     consultation with the Drug Use Review Board) shall establish 
     standards for counseling by pharmacists of individuals 
     receiving covered outpatient drugs. Such standards shall 
     include, at a minimum, the following:

       ``(I) The pharmacist must offer to discuss (in person, 
     face-to-face whenever practicable, or through access to a 
     telephone service which is toll free for long-distance calls) 
     with each individual receiving covered outpatient drugs or 
     caregiver of such individual who presents a prescription, 
     matters which in the exercise of the pharmacist's 
     professional judgment (consistent with any applicable State 
     law respecting the provision of such information), the 
     pharmacist deems significant, which may include the 
     following:

       ``(aa) The name and description of the medication.
       ``(bb) The dosage form, dosage, route of administration, 
     and duration of drug therapy.
       ``(cc) Special directions and precautions for preparation, 
     administration, and use by the patient.
       ``(dd) Common severe side or adverse effects or 
     interactions and therapeutic contraindications that may be 
     encountered, including their avoidance, and the action 
     required if they occur.
       ``(ee) Techniques for self-monitoring drug therapy.
       ``(ff) Proper storage.
       ``(gg) Prescription refill information.
       ``(hh) Action to be taken in the event of a missed dose.

       ``(II) A reasonable effort must be made by the pharmacist 
     to obtain, record, and maintain at least the following 
     information regarding individuals receiving benefits under 
     this title:

       ``(aa) Name, address, telephone number, date of birth (or 
     age) and gender.
       ``(bb) Individual history where significant, including 
     disease state or states, known allergies and drug reactions, 
     and a comprehensive list of medications and relevant devices.
       ``(cc) Pharmacist comments relevant to the individual's 
     drug therapy.
     Nothing in this clause shall be construed as requiring a 
     pharmacist to provide consultation when an individual 
     receiving benefits under this title or caregiver of such 
     individual refuses such consultation.
       ``(B) Retrospective drug use review.--The program shall 
     provide for the ongoing periodic examination of claims data 
     and other records in order to identify patterns of fraud, 
     abuse, gross overuse, or inappropriate or medically 
     unnecessary care, among physicians, pharmacists and 
     individuals receiving benefits under this title, or 
     associated with specific drugs or groups of drugs.
       ``(C) Standards.--
       ``(i) In general.--The program shall, on an ongoing basis, 
     assess data on drug use against explicit standards determined 
     by the Secretary upon the recommendations of the Drug Use 
     Review Board (using the sources described in clause (ii) as 
     the basis for determining the standards for such assessment). 
     Such assessment shall include monitoring for therapeutic 
     appropriateness, overutilization and 
     underutilization, appropriate use of generic products, 
     therapeutic duplication, drug-disease contraindications, 
     drug-drug interactions, incorrect drug dosage or duration of 
     drug treatment, and clinical abuse or misuse, and introduce 
     remedial strategies in order to improve the quality of care 
     and to conserve program funds or personal expenditures.
       ``(ii) Sources.--The sources described in this clause are 
     the American Hospital Formulary Service Drug Information, the 
     United States Pharmacopeia-Drug Information, the American 
     Medical Association Drug Evaluations, peer-reviewed medical 
     literature as approved by the Secretary, and other sources as 
     determined by the Secretary in consultation with the Drug Use 
     Review Board.
       ``(D) Education and intervention.--The program shall 
     provide for, either directly or through contracts with 
     accredited health care educational institutions, medical 
     societies or pharmacists' associations or societies, or other 
     organizations as specified by the Secretary, and using data 
     provided by the Drug Use Review Board on common drug therapy 
     problems--
       ``(i) ongoing educational outreach programs to educate 
     practitioners on common drug therapy problems with the aim of 
     improving prescribing or dispensing practices; and
       ``(ii) ongoing interventions for physicians and pharmacists 
     targeted toward common drug therapy problems or individuals 
     identified in the course of retrospective drug use reviews 
     performed under this subsection, including, in appropriate 
     instances, at least the following:

       ``(I) Written, oral, or electronic reminders containing 
     patient-specific or drug-specific (or both) information and 
     suggested changes in prescribing or dispensing practices, 
     communicated in a manner designed to ensure the privacy of 
     patient-related information.
       ``(II) Use of face-to-face discussions between health care 
     professionals who are experts in rational drug therapy and 
     selected prescribers and pharmacists who have been targeted 
     for educational intervention, including discussion of optimal 
     prescribing, dispensing, or pharmacy care practices, and 
     follow up face-to-face discussions.
       ``(III) Intensified review or monitoring of selected 
     prescribers or dispensers.

       ``(E) High risk individuals.--The program shall provide for 
     case management of drug therapy (under protocols established 
     by the Secretary) for individuals receiving covered drugs who 
     are identified as being at high risk for potential 
     medication-related problems.
       ``(F) Interchangeable pharmaceuticals.--The 
     program shall when appropriate provide for the interchange of 
     therapeutically equivalent pharmaceutical products by a 
     pharmacist after approval of the prescribing physician.
       ``(G) Patient incentive compliance programs.--The program 
     shall provide for the management of patient incentive 
     compliance programs.
       ``(H) Other services.--The program shall contain such other 
     services that the Secretary finds to be standard of pharmacy 
     practice consistent with the provision of pharmaceutical 
     care.
       ``(b) Drug Use Review Board.--
       ``(1) Establishment.--The Secretary shall establish a Drug 
     Use Review Board (hereafter in this subsection referred to as 
     the `DUR Board') without regard to the provisions of title 5, 
     United States Code, governing appointments in the competitive 
     service.
       ``(2) Membership.--
       ``(A) Composition.--The DUR Board shall consist of 9 
     members of whom--
       ``(i) 4 are individuals who are practicing physicians;
       ``(ii) 4 are individuals who are practicing pharmacists; 
     and
       ``(iii) 1 is an individual who receives benefits under this 
     title.
       ``(B) Terms.--Members of the DUR Board shall first be 
     appointed by no later than July 1, 1995, for a term of 3 
     years, except that the Director may provide initially for 
     such shorter terms as will ensure that (on a continuing 
     basis) the terms of no more than 4 members expire in any 1 
     year.
       ``(3) Chair and vice chair.--The DUR Board shall select a 
     Chair and Vice Chair from among its members.
       ``(4) Meetings.--
       ``(A) In general.--The DUR Board shall meet at the call of 
     the Chair.
       ``(B)  Initial meeting.--No later than 30 days after the 
     date on which all members of the DUR Board have been 
     appointed, the DUR Board shall hold its first meeting.
       ``(C) Quorum.--A majority of the members of the DUR Board 
     shall constitute a quorum, but a lesser number of members may 
     hold hearings.
       ``(5) Duties of the dur board.--The DUR Board shall--
       ``(A) recommend policies and procedures to the Secretary 
     for the operation of the outpatient prescription drug program 
     for the purpose of optimizing therapeutic outcomes in 
     individuals who receive benefits under this part;
       ``(B) suggest appropriate model criteria and standards of 
     prescribing and dispensing of covered outpatient prescription 
     drugs (prioritized by medical relevance) through an 
     evaluation of the FDA approved labeling of the covered 
     outpatient drug, the medical literature, other clinical data 
     available from pharmaceutical manufacturers, and expert 
     advice;
       ``(C) categorize covered outpatient drugs by therapeutic 
     class, and evaluate the relative efficacy and cost-
     effectiveness of new and existing pharmaceuticals within 
     established and new therapeutic classes of drugs for the 
     outpatient drug program under this part;
       ``(D) make recommendations, based on the clinical 
     literature, of classes of pharmaceuticals or specific 
     pharmaceuticals that should be added to or deleted from the 
     list of excludable drugs for the medicaid program under 
     section 1927(d);
       ``(E) recommend to the Secretary those covered outpatient 
     drugs which, based on data collected about the potential for 
     the drug's clinical misuse, abuse, or economic impact on the 
     medicare program under this title should be subject to 
     prescribing protocols or treatment guidelines;
       ``(F) assist in the development of pharmaceutical care 
     programs for recipients of outpatient drugs under this part; 
     and
       ``(G) suggest operational and evaluative performance 
     standards for the drug use review program under this section 
     and the State drug use review programs under title XIX.
       ``(6) Reports.--
       ``(A) Annual reports.--Not later than July 1, 1996, and 
     annually thereafter on July 1, the DUR Board shall deliver an 
     annual report to Congress, the Secretary, the States, and 
     other interested parties which shall contain recommendations 
     for appropriate administrative and legislative action that 
     will--
       ``(i) ensure the cost-effectiveness and quality of care of 
     drug therapy provided under this title and title XIX; and
       ``(ii) improve the effectiveness of the drug use review 
     program under this title and the State drug use review 
     programs under title XIX.
       ``(7) Special reports.--The DUR Board shall deliver special 
     reports on any of the matters under paragraph (5) at the 
     request of Congress.
       ``(8) Certain provisions applicable.--Section 1845(c)(1) 
     shall apply to the DUR Board in the same manner as it applies 
     to the Physician Payment Review Commission.
       ``(9) Authorization of appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out the provisions of this subsection.''.
                       Subtitle C--Effective Date

     SEC. 121. EFFECTIVE DATE.

       Except as otherwise provided, the amendments made by this 
     title shall apply to items and services furnished on or after 
     January 1, 1995.
                       TITLE II--MEDICAID PROGRAM

     SEC. 201. NO FEDERAL FINANCIAL PARTICIPATION WITH RESPECT TO 
                   CERTAIN INNOVATOR MULTIPLE SOURCE DRUGS.

       (a) In General.--Section 1903(i) (42 U.S.C. 1396b(i)) is 
     amended--
       (1) in paragraph (14), by striking the period at the end 
     and inserting a semicolon; and
       (2) by adding at the end the following new paragraphs:
       ``(15) with respect to an innovator multiple source drug 
     unless--
       ``(A) a written prescription for the drug contains, in the 
     handwriting of the physician or other person prescribing the 
     drug, the phrase `brand medically necessary' indicating that 
     a particular brand of the innovator drug product must be 
     dispensed; and
       ``(B) the physician or other person prescribing the drug 
     provides a medical justification to the State agency for 
     prescribing such drug; or
       ``(16) with respect to expenditures made by the State for 
     the dispensing of innovator multiple source drugs (determined 
     after taking into account any rebates with respect to such 
     drugs under section 1927) that exceed an amount equal to--
       ``(A) for 1995, 15 percent, and
       ``(B) for 1996 and succeeding years, 10 percent,

     of the expenditures made by the State for the dispensing of 
     all multiple source drugs (determined after taking into 
     account any rebates with respect to such drugs under section 
     1927).''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall be effective for calendar quarters beginning on or 
     after January 1, 1995.

     SEC. 202. REBATE FOR CERTAIN COVERED OUTPATIENT DRUGS.

       (a) In General.--Section 1927(c)(3)(B) (42 U.S.C. 1396r-
     8(c)(3)(B)) is amended to read as follows:
       ``(B) Applicable percentage.--
       ``(i) In general.--Except as provided in clause (ii), for 
     purposes of subparagraph (A)(i), the `applicable percentage' 
     for rebate periods beginning--

       ``(I) before January 1, 1994, is 10 percent, and
       ``(II) after December 31, 1993, is 11 percent.

       ``(ii) Special rule.--For purposes of subparagraph (A)(i), 
     if a covered outpatient drug is a noninnovator multiple 
     source drug and the average manufacturer price of such drug 
     does not exceed 50 percent of the average manufacturer price 
     for the corresponding innovator multiple source drug, the 
     `applicable percentage' for rebate periods beginning--

       ``(I) after December 31, 1994, and before January 1, 1996, 
     is 9 percent,
       ``(II) after December 31, 1995, and before January 1, 1997, 
     is 7 percent, and
       ``(III) after December 31, 1996, is 5 percent.''.

       (b) Effective Date.--The amendments made by subsection (a) 
     shall be effective for rebate periods beginning after 
     December 31, 1994.

     SEC. 203. STATE REGULATION OF OUTPATIENT PRESCRIPTION DRUG 
                   BENEFITS COVERED BY HEALTH CARE PLANS.

       (a) In General.--Title XIX (42 U.S.C. 1396 et seq.) is 
     amended--
       (1) by redesignating section 1931 as section 1932; and
       (2) by inserting after section 1930 the following new 
     section:


``STATE REGULATION OF OUTPATIENT PRESCRIPTION DRUG BENEFITS COVERED BY 
                           HEALTH CARE PLANS

       ``Sec. 1931. No payment shall be made to a State under 
     section 1903 for any calendar quarter in which such State 
     fails to have in effect regulations requiring each health 
     care plan offered in such State that covers outpatient 
     prescription drugs--
       ``(1) to establish a pharmacy and therapeutics committee or 
     drug use review board consisting of physicians and 
     pharmacists which shall make recommendations to the plan in 
     order to assure that outpatient prescription drugs used by 
     individuals enrolled in the plan are medically appropriate 
     and likely to result in positive medical outcomes;
       ``(2) to establish a therapeutic formulary of outpatient 
     prescription drugs which are approved by the pharmacy and 
     therapeutics committee or drug use review board for use by 
     individuals enrolled in the plan;
       ``(3) to establish a pharmaceutical care services program 
     which shall ensure that services provided by a pharmacist 
     licensed to practice in the State result in positive medical 
     and therapeutic outcomes and which shall include--
       ``(A) drug use review including--
       ``(i) prospective review consisting of counseling provided 
     by pharmacists to individuals enrolled in the plan on the 
     appropriate use of outpatient prescription drugs and 
     identification and avoidance of potential adverse medication-
     related outcomes before an outpatient prescription drug is 
     dispensed to an individual enrolled in the plan;
       ``(ii) retrospective review consisting of an organized 
     process to collect and analyze data concerning the drug use 
     patterns of individuals enrolled in the plan and provider 
     prescribing and dispensing patterns under the plan; and
       ``(iii) education of, and interventions for, health care 
     professionals to provide for optimal use of outpatient 
     prescription drugs among individuals enrolled in the plan;
       ``(B) management of drug therapy and case management of 
     patients that are identified as at high risk for potential 
     medication-related problems;
       ``(C) preapproved or protocol-approved interchange of 
     pharmaceutical products;
       ``(D) management of patient compliance incentive programs; 
     and
       ``(E) other services that are consistent with standard 
     pharmacy practice and consistent with providing 
     pharmaceutical care; and
       ``(4) to establish a system under which any pharmacist who 
     provides outpatient prescription drugs to individuals 
     enrolled in the plan is provided payment for services 
     required to comply with any requirements imposed on such 
     pharmacist by this section.''.
       (b) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by subsection (a) shall be effective for 
     calendar quarters beginning on or after January 1, 1996.
       (2) Delay if state legislation required.--In the case of a 
     State which the Secretary determines requires State 
     legislation (other than legislation authorizing or 
     appropriating funds) in order to comply with the amendments 
     made by subsection (a), the State shall not be regarded as 
     failing to comply with such amendments solely on the basis of 
     its failure to meet the requirements of such amendments 
     before the first day of the first calendar quarter beginning 
     after the close of the first regular session of the State 
     legislature that begins after the date of the enactment of 
     this Act. For purposes of the preceding sentence, in the case 
     of a State that has a 2-year legislative session, each year 
     of such session shall be deemed to be a separate regular 
     session of the State legislature.
                         TITLE III--COMMISSIONS

     SEC. 301. PHARMACEUTICAL MARKETPLACE INFORMATION COMMISSION.

       Part A of title XI (42 U.S.C. 1301 et seq.), as amended by 
     section 13581(a) of the Omnibus Budget Reconciliation Act of 
     1993, is amended by adding at the end the following new 
     section:


          ``PHARMACEUTICAL MARKETPLACE INFORMATION COMMISSION

       ``Sec. 1145. (a) In General.--
       ``(1) Establishment.--The Secretary shall provide for the 
     appointment of the Pharmaceutical Marketplace Information 
     Commission (in this section referred to as the `Commission'), 
     without regard to the provisions of title 5, United States 
     Code, governing appointments in the competitive service.
       ``(2) Membership.--The Commission shall consist of 9 
     individuals. The membership of the Commission shall include 
     recognized experts in the fields of pharmacoeconomics, 
     industrial cost accounting, medicine, pharmacy, and science, 
     a consumer, a representative of a patient advocacy group.
       ``(3) Terms.--Members of the Commission shall first be 
     appointed by no later than July 1, 1995, for a term of 3 
     years, except that the Director may provide initially for 
     such shorter terms as will ensure that (on a continuing 
     basis) the terms of no more than 4 members expire in any 1 
     year.
       ``(4) Chair and vice chair.--The Commission shall select a 
     Chair and Vice Chair from among its members.
       ``(5) Meetings.--
       ``(A) In general.--The Commission shall meet at the call of 
     the Chair.
       ``(B)  Initial meeting.--No later than 30 days after the 
     date on which all members of the Commission have been 
     appointed, the Commission shall hold its first meeting.
       ``(C) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum, but a lesser number of members may 
     hold hearings.
       ``(b) Duties of the Commission.--The Commission shall have 
     the following duties:
       ``(1) Domestic pharmaceutical prices.--
       ``(A) Publication of pricing information.--The Commission 
     shall annually publish the weighted average price of each 
     dosage form and strength of each single source drug and 
     innovator multiple source drug sold to all purchasers of such 
     drug in the United States and the average manufacturer's 
     price for each such drug distributed to the retail class of 
     trade.
       ``(B) Information source on price concessions.--The 
     Commission shall--
       ``(i) serve as a source of information for purchasers on 
     the policies and procedures of drug manufacturers concerning 
     the terms under which manufacturers provide rebates, 
     discounts and other price concessions to pharmaceutical 
     purchasers; and
       ``(ii) receive and investigate information (provided by 
     purchasers) relating to instances in which manufacturers are 
     not offering and providing products on similar terms and 
     conditions to all purchasers.
       ``(2) International pharmaceutical prices.--The Commission 
     shall monitor, analyze, and publish price information 
     relating to currently marketed and new pharmaceutical prices 
     for drugs, biologicals, and vaccines in other industrialized 
     nations, including those nations described in section 
     802(b)(4)(A) of the Federal Food, Drug, and Cosmetic Act. 
     Such information shall include the average price in all 
     classes of trade, and the average price sold to the retail 
     class of trade in each country. The Commission shall also 
     monitor mechanisms used by other industrialized nations to 
     contain pharmaceutical expenditures.
       ``(3) Prices of certain pharmaceuticals.--
       ``(A) In general.--The Commission shall review the price of 
     drugs and biologicals and provide information to purchasers 
     to determine whether the price of the drug or biological is 
     reasonable if such drug or biological product--
       ``(i)(I) is a new drug or biological which is a significant 
     clinical advance or breakthrough over pharmaceutical products 
     currently available to treat a particular condition, whether 
     or not the product is a new chemical or biological entity;
       ``(II) a new drug or biological which has received a 
     designation of 1-AA or 1-P by the Food and Drug 
     Administration;
       ``(III) is an orphan drug product;
       ``(IV) is a currently marketed drug for which there are no 
     other therapeutic alternatives on the market; or
       ``(V) the Federal Government had a substantial role in the 
     development of the drug or biological, and such support was 
     essential to the approval of the drug by the Food and Drug 
     Administration; and
       ``(ii) a request is made to review the price of such drug 
     or biological by--

       ``(I) the Secretary;
       ``(II) a member of the Commission;
       ``(III) not less than 3 groups representing consumers or 
     patient advocates, or
       ``(IV) not less than three health plans providing such drug 
     or biological, where such plans present evidence that the 
     price is excessive.

       ``(B) Guidelines for determination.--The Commission shall 
     use the following information to determine whether the price 
     of the drug or biological is reasonable:
       ``(i) Domestic comparison.--The Commission shall compare 
     the price of the drug or biological with the price of drugs 
     or biologicals in the same therapeutic class used to treat 
     similar therapeutic conditions in the United States.
       ``(ii) International comparison.--The Commission shall 
     compare the price of the drug or biological with the price of 
     the drug or biological in section 802(b)(4)(A) of the Federal 
     Food, Drug, and Cosmetic Act.
       ``(iii) Manufacturer information.--The Commission shall 
     consider the following information provided by the 
     manufacturer of the drug or biological:

       ``(I) The manufacturer's costs of manufacturing, 
     researching, and developing the product.
       ``(II) The anticipated revenue from the sales of the 
     product in the United States and international markets.
       ``(III) The manufacturer's anticipated costs of marketing 
     and advertising for the product.
       ``(IV) Anticipated revenue from off-label uses of the 
     product.
       ``(V) Extraordinary circumstances that justify the price 
     charged in the United States market.
       ``(VI) the expected period of patent life or market 
     exclusivity for the product.
       ``(VII) Profit expected by the manufacturer as a result of 
     the sales of the product in the United States and other 
     industrialized nations.
       ``(VIII) Other relevant factors that the manufacturer would 
     like the Commission to consider.

       ``(iv) Investigations paid for by federal government.--
     Funds expended by the Federal Government either directly or 
     indirectly to support investigations that were significant to 
     the application made to the Food and Drug Administration to 
     approve the drug or biological.
       ``(v) Cost-effectiveness.--The cost-effectiveness of the 
     pharmaceutical relative to other medical treatment 
     alternatives, including nonpharmaceutical treatments, such as 
     devices.
       ``(vi) Quality of life improvement.--The improvements in 
     the quality of life offered by the product, including the 
     ability to return to work and other appropriate measures of 
     improvement in the quality of life.
       ``(C) Determination.--
       ``(i) Hearing.--The Commission shall hold a public hearing 
     to collect information and data from groups interested in the 
     price of the drug or biological before making a report 
     described in subparagraph (B).
       ``(ii) Report.--The Commission shall publish a report on 
     the reasonableness of a drug or biological as determined 
     under this paragraph, with all available information and 
     justification for its findings.
       ``(iii) Appeal.--The Commission shall develop a process for 
     an interested party to appeal the report of the Commission.
       ``(iv) No binding effect.--No report of the Commission 
     issued under this subparagraph shall have binding effect upon 
     any manufacturer or purchaser.
       ``(D) Confidentiality of proprietary information provided 
     to the commission.--Any proprietary information provided by a 
     manufacturer to the Commission under this subsection shall be 
     held confidential.
       ``(4) Utilization of generic pharmaceuticals.--The 
     Commission shall--
       ``(A) monitor the rate of dispensing generic drugs in the 
     United States;
       ``(B) publish (at least semiannually) and make available to 
     health care providers information about the availability and 
     relative costs of generic drugs compared to the costs for the 
     equivalent innovator versions of these drugs; and
       ``(C) monitor the pricing patterns of generic drugs, and 
     the extent to which domestic and international trade policies 
     affect the ability of generic pharmaceutical manufacturers to 
     obtain materials for the purpose of manufacturing and selling 
     generic drugs in the United States.
       ``(5) Pharmaceutical patent extensions.--Not less than 90 
     days before the expiration of a pharmaceutical patent for 
     which the holder of the patent has sought an extension of 
     that patent, the Commission shall provide to the Congress and 
     the Office of Patents and Trademarks an analysis of the 
     feasibility and desirability of extending the patent as 
     provided in the terms of the Drug Price Competition and 
     Patent Term Restoration Act of 1984.
       ``(6) Pharmacoeconomic and cost-effectiveness analysis.--
     The Commission shall--
       ``(A) develop a standard methodology for the purpose of 
     conducting pharmacoeconomic and cost-effectiveness 
     analyses of pharmaceutical and biological products; and
       ``(B) collect and disseminate information to purchasers 
     about the relative cost-effectiveness and cost-benefit of 
     various pharmaceutical products as compared to other 
     pharmaceutical products and other medical technologies, 
     including making evaluations of the new savings to the health 
     care system as a result of new pharmaceutical and biological 
     products.
       ``(c) Certain Provisions Applicable.--Section 1845(c)(1) 
     shall apply to the Commission in the same manner as it 
     applies to the Physician Payment Review Commission.
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out the provisions of this section.''.

     SEC. 302. PRESCRIPTION DRUG PAYMENT REVIEW COMMISSION.

       Part A of title XI (42 U.S.C. 1301 et seq.), as amended by 
     section 301, is amended by adding at the end the following 
     new section:


             ``PRESCRIPTION DRUG PAYMENT REVIEW COMMISSION

       ``Sec. 1146. (a) Establishment.--The Director of the 
     Congressional Office of Technology Assessment (in this 
     section referred to as the `Director' and the `Office', 
     respectively) shall provide for the appointment of a 
     Prescription Drug Payment Review Commission (in this section 
     referred to as the `Commission') without regard to the 
     provisions of title 5, United States Code, governing 
     appointments in the competitive service.
       ``(b) Membership.--
       ``(1) Composition.--The Commission shall consist of 11 
     individuals with expertise in the provision and financing of 
     prescription drugs under federally funded health care 
     programs.
       ``(2) Terms.--Members of the Commission shall first be 
     appointed by no later than July 1, 1995 for a term of 3 
     years, except that the Director may provide initially for 
     such shorter terms as will ensure that (on a continuing 
     basis) the terms of no more than 4 members expire in any 1 
     year.
       ``(3) Chair and vice chair.--The Commission shall select a 
     Chair and Vice Chair from among its members.
       ``(c) Meetings.--
       ``(1) In general.--The Commission shall meet at the call of 
     the Chair.
       ``(2)  Initial meeting.--No later than 30 days after the 
     date on which all members of the Commission have been 
     appointed, the Commission shall hold its first meeting.
       ``(3) Quorum.--A majority of the members of the Commission 
     shall constitute a quorum, but a lesser number of members may 
     hold hearings.
       ``(d) Duties of the Commission.--
       ``(1) In general.--The Commission shall--
       ``(A) monitor the scope of coverage, reimbursement, 
     expenditure levels, and financing of prescription drugs under 
     Federal health care programs;
       ``(B) monitor the prices for prescription and 
     nonprescription drugs (on the retail level and manufacturer 
     level) used in Federal health care programs;
       ``(C) recommend modifications and changes in cost 
     containment measures and payment and reimbursement rates 
     under Federal health care programs;
       ``(D) monitor and analyze the extent to which 
     pharmaceuticals and pharmacy services are available to 
     specific populations, including citizens in rural areas of 
     the United States;
       ``(E) evaluate technologies available for efficient 
     administration of Federal health care programs and other 
     third party prescription drug programs; and
       ``(F) determine the annual cost of dispensing a 
     prescription for various classes of pharmacies to assist in 
     the development of reimbursement and payment rates to 
     providers.
       ``(2) Reports.--
       ``(A) Annual reports.--Not later than July 1, 1996, and 
     annually thereafter on July 1, the Commission shall deliver 
     an annual report to Congress which shall contain the findings 
     and conclusions of the Commission, on each of the matters 
     under paragraph (1).
       ``(B) Special reports.--The Commission shall deliver 
     special reports on any of the matters under paragraph (1) at 
     the request of Congress.
       ``(e) Certain Provisions Applicable.--Section 1845(c)(1) 
     shall apply to the Commission in the same manner as it 
     applies to the Physician Payment Review Commission.
       ``(f) Authorization of Appropriations.--There are 
     authorized to be appropriated such sums as may be necessary 
     to carry out the provisions of this section.''.
              TITLE IV--ADDITIONS TO THE MASTER AGREEMENT

     SEC. 401. EQUAL ACCESS TO DISCOUNTS.

       (a) In General.--Section 8126(a) of title 38, United States 
     Code, as amended by section 101(b), is amended--
       (1) by striking ``and'' at the end of paragraph (3);
       (2) by redesignating paragraph (4) as paragraph (5); and
       (3) by inserting after paragraph (3) the following new 
     paragraph:
       ``(4)(A) each manufacturer of single source and innovator 
     multiple source drugs (as described in section 1927(k) of the 
     Social Security Act) shall offer such pharmaceuticals for 
     sale to every purchaser on equal terms and conditions 
     including any rebates, free merchandise, discounts, and other 
     similar adjustments (excluding any terms offered to the 
     Department of Veterans Affairs, the Department of Defense, 
     entities that receive funding under the Public Health 
     Service, any other entity receiving discounts under section 
     340(b) of the Public Health Service Act, and any other 
     Federal or State government agency that directly procures 
     pharmaceuticals);
       ``(B) each manufacturer of single source and innovator 
     multiple source drugs may only offer rebates, free 
     merchandise, discounts, and other similar adjustments, if the 
     manufacturer experiences savings as a result of efficiencies 
     in purchasing, such as volume buying (including programs to 
     increase volume buying through influencing physician 
     prescribing practices or by making an agreement to place 
     drugs on a formulary), prompt delivery, single-site delivery, 
     and prompt payment;
       ``(C) each manufacturer of single source and innovator 
     multiple source drugs shall make information describing the 
     terms and conditions described in subparagraph (A) available 
     to the public and the Pharmaceutical Marketplace Information 
     Commission (established under section 1145 of the Social 
     Security Act); and
       ``(D) each manufacturer that knowingly violates the 
     requirement under the preceding subparagraphs shall be 
     subject to a civil fine of not more than $100,000 per 
     violation; and''.

     SEC. 402. PROVISION OF INFORMATION TO THE PHARMACEUTICAL 
                   MARKETPLACE INFORMATION COMMISSION.

       (a) In General.--Section 8126(a) of title 38, United States 
     Code, as amended by sections 101(b) and 401, is amended--
       (1) by striking ``and'' at the end of paragraph (4);
       (2) by redesignating paragraph (5) as paragraph (6); and
       (3) by inserting after paragraph (4) the following new 
     paragraph:
       ``(5)(A) each manufacturer of a single source and innovator 
     multiple source drug (as defined in section 1927(k) of the 
     Social Security Act) shall report to the Pharmaceutical 
     Marketplace Information Commission (established under section 
     1145 of the Social Security Act) such information as the 
     Commission may require to compile the data necessary to 
     publish the domestic pricing information described in section 
     1145(b)(1)(A) of the Social Security Act and the 
     international pricing information described in section 
     1145(b)(2) of such Act no later than 30 days after the end of 
     each calendar quarter, and
       ``(B) each manufacturer shall make available to the 
     Pharmaceutical Marketplace Information Commission any 
     additional information required by the Commission; and''.

     SEC. 403. CONFORMING AMENDMENTS.

       (a) Additional Requirements for Participation.--Section 
     8126(a)(6) of title 38, United States Code, as redesignated 
     in section 402(a)(2), is amended by striking ``, and (3)'' 
     and inserting ``(3), (4), and (5)''.
       (b) Amendments to Effective Date Provisions.--
       (1) Medicaid.--Section 1927(a) is amended--
       (A) in paragraph (5)--
       (i) in subparagraph (D), by striking ``title VI of the 
     Veterans Health Care Act of 1992'' and inserting ``the 
     Pharmaceutical Marketplace Reform Act of 1994''; and
       (ii) in subparagraph (E), by striking ``immediately after 
     the enactment of this paragraph)'' and inserting 
     ``immediately after the enactment of the Pharmaceutical 
     Marketplace Reform Act of 1994)''; and
       (B) in paragraph (6)--
       (i) in subparagraph (B), by striking ``title VI of the 
     Veterans Health Care Act of 1992'' and inserting ``the 
     Pharmaceutical Marketplace Reform Act of 1994''; and
       (ii) in subparagraph (C), by striking ``immediately after 
     the enactment of this paragraph)'' and inserting 
     ``immediately after the enactment of the Pharmaceutical 
     Marketplace Reform Act of 1994)''.
       (2) Public health service.--Section 340B(d) of the Public 
     Health Service Act is amended by striking ``the Veterans 
     Health Care Act of 1992'' and inserting ``the Pharmaceutical 
     Marketplace Reform Act of 1994''.
       (3) Veterans' affairs.--Section 8126(g) of title 38, United 
     States Code, is amended--
       (A) in paragraph (1), by inserting ``, except that such 
     reference shall include any amendments to the Social Security 
     Act made by the Pharmaceutical Marketplace Reform Act of 
     1994'' before the period at the end; and
       (B) in paragraph (2)--
       (i) by striking ``this section)'' and inserting ``the 
     Pharmaceutical Marketplace Reform Act of 1994)''; and
       (ii) by striking ``date of the enactment of this section'' 
     and inserting ``date of the enactment of the the 
     Pharmaceutical Marketplace Reform Act of 1994''.

     SEC. 404. EFFECTIVE DATE.

       Except as otherwise provided, the amendments made by this 
     title shall apply on and after December 31, 1994.
                                  ____


                         Summary of Provisions


                       Title I--Medicare Program

             Medicare covered outpatient prescription drugs

       This section would incorporate managed care principles into 
     Medicare's mechanism for covering outpatient prescription 
     drugs. It would provide for prudent pharmaceutical cost 
     containment mechanisms and the development of standards for 
     drug use review and pharmaceutical care for Medicare 
     beneficiaries.

               (I) Medicare Drug Program cost containment

       This section would provide Medicare--the largest purchaser 
     of medications in the United States--with the same 
     pharmaceutical cost containment management tools currently 
     used by a wide variety of fee-for-service and managed care 
     plans.
       As a condition of coverage for their products under 
     Medicare, brand name pharmaceutical manufacturers would be 
     required to pay a rebate or a discount to Medicare of 17 
     percent off the average manufacturers retail price (AMRP). 
     Manufacturers could negotiate higher rebates with the 
     Secretary of Health and Human Services (HHS), and physicians 
     would be encouraged to utilize these higher rebated drugs for 
     Medicare beneficiaries when medically appropriate. No rebate 
     would be required for generic drugs except where the price of 
     the generic drug is greater than 50 percent of the price of 
     the innovator's brand of the drug. In such cases the 
     manufacturer of the generic drug would pay an 11-percent 
     rebate.
       The Secretary of HHS would be permitted to negotiate 
     rebates with manufacturers of new drugs that are covered by 
     Medicare. These negotiations would occur if (1) the Medicare 
     program is a primary payer for the new drug, (2) the new drug 
     is not cost effective at the price the manufacturer is 
     charging, (3) the new drug is less expensive in other major 
     industrialized countries, or (4) the federal government had a 
     substantial role in developing the new drug. If a 
     manufacturer will not negotiate in good faith with the 
     Secretary, the Secretary has the option not to cover the new 
     drug or to require prior authorization before the new drug 
     can be used.
       Generic versions of brand name drugs would be dispensed to 
     Medicare beneficiaries when they are available, but only if 
     the Food and Drug Administrtion (FDA) has determined the 
     generic version to be equivalent to its brand name 
     counterpart.
       The brand name version of a drug with generic equivalents 
     would still be available if the physician writes ``brand 
     medically necessary'' on the prescription. The Secretary of 
     HHS has the option to require medical justification from the 
     prescribing physician for requiring use of the brand name 
     drug.
       The Secretary could utilize prescribing protocols or 
     guidelines for any drug covered under Medicare.

       (II) Drug use review and coordination pharmaceutical care

       The legislation develops a program to optimize the user of 
     medications among Medicare beneficiries and to improve 
     therapeutic outcomes.
       Standards are established for drug use review (DUR) and 
     pharmaceutical care programs for Medicare beneficiaries. 
     Under the DUR program, Medicare beneficiaries would be 
     counseled by pharmacists on how to use medications properly. 
     Pharmacists would be required to check prescriptions before 
     dispensing in order to prevent purchasers from experiencing 
     adverse reactions. A program would be established to provide 
     feedback to physicians and pharmacists about the use of drugs 
     by Medicare beneficiaries.
       Under the pharmaceutical care program, pharmacists would be 
     utilized to monitor and manage the drug therapy of certain 
     Medicare beneficiaries that are identified as at high risk 
     for potential medication problems. The Secretary would be 
     required to develop a methodology to compensate pharmacists 
     for these cost-saving services.
       A Medicare DUR Board consisting of physicians and 
     pharmacists would be established. The Board would be 
     responsible for recommending policies and procedures to the 
     Secretary for the operation of the Medicare drug program. The 
     Board's recommendations would work toward the maximization of 
     medication outcomes in Medicare beneficiaries.


                       Title II--Medicaid Program

        Modifications to the Medicaid Prescription Drug Program

       Although the Medicaid program may eventually be 
     incorporated into the overall reformed health care system, 
     the provisions in this legislation would produce Medicaid 
     savings over the next few years by maximizing the use of 
     generic medications.
       This section would allow brand name medications that have 
     generic equivalents to be dispensed only when the physician 
     has indicated in his own handwriting on the prescription that 
     the brand name drug is ``medically necessary'' for the 
     patient, and has provided medical justification to the state 
     Medicaid agency.
       In addition, it would require that the state Medicaid 
     program increase its expenditures on generic pharmaceuticals 
     (as a percentage of all multiple source drug expenditures by 
     the state) to 85 percent in 1995 and 90 percent in 1996 and 
     thereafter. (Currently, the rate of generic dispensing in 
     Medicaid is only about 70 to 75 percent, costing Medicaid 
     millions of dollars each year.) State Medicaid agencies would 
     lose part of their federal matching funds if they exceeded 
     the allowable rate of brand name dispensing.
       If the price of a generic drug is more than 50 percent of 
     the price of the brand name drug, the rebate to Medicaid for 
     the generic drug would be 11 percent. For other generics, the 
     rebate would decrease from 11 percent in 1994 to 9 percent in 
     1995, 7 percent in 1996, and 5 percent in 1997 and 
     thereafter.

  Standards for pharmaceutical care provisions related to outpatient 
                       prescription drug benefits

       As a condition of receiving federal Medicaid matching 
     funds, states must require that all health care plans in the 
     state meet minimum standards for providing pharmaceuticals to 
     their enrollees. These standards would require plans to:
       Use therapeutic drug formularies;
       Establish a Pharmacy and Therapeutics Committee to develop 
     the therapeutic formulary and provide oversight regarding 
     drug use in the plan; and
       Develop a program of pharmaceutical care to optimize the 
     use of prescription medications among plan enrollees. This 
     program would include DUR to ensure that enrollees know how 
     to use their medications properly and to help avert potential 
     adverse reactions.
       Pharmacists would be utilized to monitor and manage the 
     drug therapy of certain Medicare beneficiaries that are 
     identified as high risk for potential medication problems. 
     The plans would compensate pharmacists for performing these 
     cost-saving services.


                         Title III--Commissions

   Establishment of the Pharmaceutical Marketplace Price Information 
                               Commission

       A critical component in helping the pharmaceutical 
     marketplace work more effectively is providing buyers with 
     information about prices. To date, a lack of good, reliable 
     price information in the pharmaceutical marketplace has 
     hindered buyers from making the best possible purchasing 
     decisions. To assist buyers in purchasing pharmaceuticals 
     prudently, a nine-member ``Pharmaceutical Marketplace Price 
     Information Commission'' would be established within HHS.
       The Commission would have the following responsibilities:
       To provide general information about pharmaceutical prices 
     in the United States market;
       To provide general information about pharmaceutical prices 
     in international, industrial-based markets, such as England 
     and Japan;
       To provide information to buyers about whether the prices 
     of new drugs are ``reasonable'' based on: the prices of 
     similar drugs in this country, the prices of the new drug in 
     other countries, information about the costs of making the 
     drugs, the improvements that the use of the drug make in an 
     individual's quality of life, and the cost-effectiveness of 
     the drug;
       To monitor the utilization and prices of generic drugs; and
       To make recommendations to Congress concerning the 
     desirability of extending patents on certain pharmaceutical 
     products.
       The Commission would act purely as an information source. 
     It would not have the authority to regulate or control drug 
     prices.

              Prescription Drug Payment Review Commission

       An 11-member Prescription Drug Payment Review Commission 
     would be established with functions similar to those assigned 
     by Congress to the Prospective Payment Commission (ProPAC), 
     and the Physician Payment Review Commission (PPRC). These 
     Commissions were established to monitor the Medicare Part A 
     program (hospital services) and the Medicare Part B program 
     (physician services), respectively. The Commission would 
     monitor Medicare drug program operations, conduct studies, 
     and make recommendations to Congress on the operation of the 
     Medicare drug program in general.


             Title IV--Additions to the VA Master Agreement

        Equal access to pharmaceutical manufacturers' discounts

       This section would require drug manufacturers to treat all 
     buyers of their products equitably and fairly when 
     negotiating price concessions and price discounts. It would 
     require manufacturers to offer price concessions on the same 
     terms and conditions to all purchasers. Any purchaser meeting 
     the manufacturer-specified terms would have access to the 
     discounted prices. In addition, these terms could be offered 
     only if they result in savings to the manufacturers based on 
     volume purchase, prompt pay, or prompt delivery terms.
       Currently, drug manufacturers tend to negotiate price 
     concessions with buyers based on the ``class of trade'' to 
     which the buyers belong, rather than economic savings that 
     the buyers produce for the manufacturer. Under this proposal, 
     manufacturers could no longer provide preferential pricing or 
     discounts based solely on the ``class of trade'' to which the 
     buyer belongs.
       Discounts could be provided for institutions and purchasers 
     that use drug formularies as long as the formulary results in 
     an increase in volume of drugs bought by the purchaser and 
     the terms under which the manufacturer gives these discounts 
     are provided on an equal basis to all purchasers.

  Mr. SASSER. Mr. President, I rise today in strong support of the 
Pharmaceutical Marketplace Reform Act of 1994. I would like to 
congratulate my good friend from Arkansas, Senator Pryor, on his work 
in bringing this important legislation to the floor of the Senate. I am 
honored to join him today as an original cosponsor of this timely 
measure.
  As most of my colleagues are aware, the distinguished chairman of the 
Senate Special Committee on Aging has worked long and hard to make this 
body and the general public aware of the many pressing issues facing 
senior citizens today. The bill we are introducing in the Senate today, 
in my view, addresses a critical problem which disproportionately 
affects older Americans. That problem is the high and rapidly rising 
cost of prescription drugs.
  I will not repeat the facts and statistics so concisely reviewed by 
my colleague from Arkansas. They speak for themselves. But I want my 
colleagues to know that when I go home to Tennessee and talk about 
prescription drugs, the statistics do not surprise my older 
constituents.
  Senior citizens in my State--and probably across the entire Nation--
know that most of their older friends and loved ones have no insurance 
coverage for prescription drugs. And, of course, Medicare does not 
presently pay for outpatient prescription medicines.
  They know--as Senator Pryor stated--that prescription medicines are 
far and away the highest out-of-pocket medical expense facing older 
Americans.
  Practically to the person, each of them, or an older family member or 
friend, have had to choose between buying food, paying utility bills, 
or purchasing the medications prescribed by their doctor.
  And Mr. President, they become angry and upset when I talk about the 
unfair prices they have to pay.
  They do not understand how we here in Washington can allow drug 
makers to charge Americans 50 or 60 percent more than citizens of 
Britain, Canada, and other countries for the same drugs.
  They don't understand how drug companies can charge their community 
pharmacist 10 times more for a heart drug than they charge the hospital 
down the highway.
  And they don't understand why inflation for prescription drugs at the 
producer level has been 4\1/2\ times the inflation rate of other 
producer prices for the last 14 years.
  Mr. President, the legislation we bring before the Senate today 
provides a moderate and commonsense approach to this urgent problem 
facing older Americans and all of our constituents. What consumers want 
is simple and reasonable. They want fair prices for prescription drugs. 
And they want the information they need to make sound, economical 
decisions.
  Our bill will ensure that all payers--Medicare and Medicaid, 
hospitals, nursing homes, local supermarkets and drug stores--and 
individual buyers of prescription drugs--have the cost information they 
need, but previously have found unavailable.
  Senator Pryor has gone through the specifics of the legislation, so I 
will just focus on two of the provisions that I consider particularly 
important.
  First is the title relating to any future Medicare prescription drug 
benefit. I want to state clearly today that I support the inclusion of 
outpatient prescription drugs for Medicare beneficiaries in the health 
care reform legislation we will consider later this year.
  Today, without drug coverage from either Medicare or private 
insurance, too many seniors either go broke trying to pay for 
medicines, or do without them because they cannot afford the high 
prices. Many seniors have told me they will buy a month's supply of 
pills, and stretch them out to 2 months by taking one a day instead of 
two a day, as presdribed by their doctor. Some will cut tablets in half 
instead of taking a whole tablet, as indicated on their prescription. 
And as we all know, when people don't take their medicines as 
prescribed, their condition may deteriorate. It goes without saying 
that costs for hospitalization and physician services--Medicare 
payments, insurance payments, out-of-pocket payments--all go up when 
people get sicker or don't get well because they can't afford their 
prescription medicines.
  So providing an outpatient Medicare prescription drug benefit is the 
right thing to do, and it makes sense for the program and its 
beneficiaries. But if we are going to provide prescription drugs under 
Medicare, we must make sure the program includes the proper cost-
containment mechanisms needed to ensure this benefit is affordable.
  This bill gives Medicare the same cost-containment tools currently 
used by many private insurance companies and managed care plans. It 
requires brand name drug manufacturers to pay a 17-percent rebate or 
discount to Medicare. Generic drugs would cost Medicare no more than 
half of the price of the comparable brand name drug, or be subject to 
an 11-percent rebate. The Secretary of Health and Human Services would 
be able to negotiate rebates with manufacturers of new drugs that are 
covered by Medicare.
  Importantly, the Medicare Program would ensure the full participation 
of pharmacists in counseling patients, monitoring and managing the drug 
therapy of high risk beneficiaries, and helping establish utilization 
review policies and procedures for the drug program.
  The Medicare provisions included in our legislation will improve 
medical outcomes, and add substantially to the value and cost-
effectiveness of the prescription drug benefit.
  I would note that recent studies have shown that these types of cost-
containment mechanisms will reduce the cost of a Medicare drug benefit 
by more than half.
  The second provision I would like to highlight here today is the 
requirement on drug manufacturers to treat all buyers of their products 
in a fair and equitable manner with regard to pricing practices.
  Presently, drug makers negotiate prices with buyers based on what is 
generally referred to as the class of trade to which they belong, 
rather than on economic savings the purchasers produce for the 
manufacturer. Retail pharmacists--both chain drug stores and 
independent pharmacists--are forced to pay far more than hospitals, 
managed care plans, mail order firms, and other buyers for the same 
volume of products shipped under identical conditions. The result of 
current drug manufacturers' discriminatory pricing policies is a 
distortion of the market. Examples of this problem make the case for 
our provision:
  Community pharmacies are charged $48.31 for 100 60-milligram tablets 
of the common blood pressure medicine, Inderal, made by the Wyeth Co. 
Noncommunity pharmacies receive a discounted price on the same package 
of $4.12. So a neighborhood pharmacy may pay 1,073 percent more for the 
same drug made by the same company bought under the same conditions.
  Searle makes another heart medicine, Calan. The price difference is 
$22.91 for community pharmacies and $3.90 for institutional pharmacies. 
That difference is 487 percent.
  Our measure would require manufacturers to offer price concessions on 
the same terms and conditions to all purchasers. It's that simple. Any 
purchaser that buys the same quantity of a particular product, pays as 
promptly, and takes the same prompt delivery, gets the same discount. 
No longer would drug companies be able to use the class of trade 
distinction as a means to unfairly overcharge community pharmacies for 
drugs. I believe this provision will serve to restore a level playing 
field to the prescription drug market and provide all of our citizens 
with a fair price for the prescription drugs they need.
  So Mr. President, let me conclude by once again commending my 
colleague from Arkansas for his work in this area and in crafting this 
badly needed legislation. I pledge to work with him to ensure that our 
legislation receives full consideration by the Senate and ultimately 
passes into law.
                                 ______

      By Mr. HATCH:
  S. 2240. A bill entitled the ``Rape Victims' Protection Act''; to the 
Committee on the Judiciary.


                      rape victims' protection act

  Mr. HATCH. Mr. President, I rise today to introduce legislation to 
remedy an unacceptable and outrageous development for women across this 
country as reported in the Washington Post this morning.
  This week, the YWCA chapter in Springfield, MA, was ordered by a 
Massachusetts court to turn its rape counseling files over to the 
defense attorney of an accused rapist. The rape counseling center had 
previously refused to turn over the files. The lower court ordered that 
if they did not turn over the files, the then-current board of 
directors, all volunteers, would each have to pay $500 per day until 
they turned over those files. They ultimately had to do because none of 
those citizens who were acting as volunteers on the board had the money 
or the wherewithal to be able to pay the $500 a day to uphold the 
principle that these types of files should not be disclosed to the 
perpetrator of the crime, or at least, in this case, the alleged 
perpetrator of the crime.
  Mr. President, as a result of this decision, women seeking rape 
counseling will do so knowing that everything they say to their 
counselor is, in effect, available ultimately to an alleged attacker.
  By the way, the lower court decision yesterday was upheld by the 
supreme court of the State of Massachusetts. This is one of the more 
liberal States of the Union.
  I am basically shocked by the decision. But I have to add a caveat 
here. The court may not have had any choice because the State of 
Massachusetts may not have provided for a privilege against such action 
by the defense attorney on behalf of the rape crisis counseling center 
and counselors not to have to disclosed the confidential remarks and 
counseling that the victim had with them.
  The impact on women is obvious. Rape counseling services offered by 
the YWCA or other organizations offer an invaluable service to women 
victimized by sexual assaults. There are at least 300 YWCA's across 
this country offering these wonderful services to women who have 
nowhere else to turn. And our own rape crisis center, our own YWCA 
organization out in Salt Lake City, just to single one out--we have 
them in a number of cities--has converted the whole YWCA into helping 
these battered and tortured and abused women, many of whom have 
suffered from rape.
  They provide an invaluable service to women, and in many respects it 
is the only kind of counseling these unfortunate women are going to 
get. These counselors are professionals. They are effective. But there 
can be no question that the removal of any confidentiality between the 
rape victim and her counselor will discourage these women from seeking 
desperately needed help in a time of real need and distress.
  Mr. President, the bill I am introducing today is direct and 
straightforward. It provides that.

       In any criminal or civil action for rape or sexual assault, 
     no court, State or Federal, shall order the disclosure of the 
     records of rape counseling or battered women centers, or 
     shall compel testimony from the agents or employees of such 
     centers with respect to the substance of their counseling, 
     unless the moving party demonstrates a compelling need for 
     such records or testimony.

  It is not a total privilege. But we do provide the highest legal 
standard. They would have to show a compelling need for such records or 
testimony before any court could order this. This would be an 
inestimable protection to women and these centers and these counselors 
as we go into the future.
  As counsel for the Springfield YWCA pointed out in the Washington 
Post article this morning, currently rape counseling records must be 
turned over if the judge finds them relevant. According to the article, 
she advocates that defendants should face a higher standard in order to 
obtain rape crisis files.
  We believe this bill will provide that higher standard. It is 
imperative that we act swiftly in this area as we all understand rape 
and sexual assault are seriously unreported crimes. Victims of such 
crimes deserve to know that they can reach out to a professional for 
badly needed assistance, and they deserve no less.
  Mr. President, I am very concerned about this subject, because I see 
more and more of this type of treatment of women across the country. I 
have seen plenty of it over the years. I have nothing but respect for 
these YWCA's that provide this voluntary counseling for the women who 
have nowhere else to turn, to live, or to go, and in many cases who are 
brutalized by husbands or boyfriends, or whomever. In the case of rape 
victims, I think there is little or no reason to not invoke a privilege 
on the part of, or on behalf of, the rape crisis center, or the 
counseling center, from having to give those types of records to the 
courts; and especially they should not have to give them to the counsel 
for the alleged perpetrator of the crime.
  Mr. President, I ask unanimous consent that the article entitled 
``YWCA, Ordered To Release Rape Counseling Files To Seek New Law,'' by 
Christopher B. Daly, a special to the Washington Post, be printed in 
the Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

               [From the Washington Post, June 24, 1994]

    YWCA, Ordered To Release Rape Counseling Files, To Seek New Law

                        (By Christopher B. Daly)

       Boston.--The YWCA, an organization that has provided rape 
     and domestic violence counseling to millions of American 
     women, said today it now must warn clients their records may 
     not be confidential after the state's highest court ordered 
     it to turn over files in a rape case.
       But the group's national leadership vowed to fight in 
     Congress and state legislatures for laws that would cloak 
     rape counseling files with legal confidentiality.
       ``Women are raped, beaten and murdered every day in this 
     country. If courts will not protect them, the YWCA will,'' 
     said executive director Prema Mathai-Davis. ``To ask for 
     confidential files is sending a dangerous message to girls 
     and women everywhere--that if you are raped, you have no 
     place to turn to.''
       Late Wednesday, the YWCA chapter in Springfield, about 100 
     miles west of Boston, reluctantly surrendered counseling 
     files to the defense attorney representing accused rapist 
     Luis Figueroa. YWCA officials said they had no choice after 
     the state Supreme Court upheld a trial court's contempt order 
     that imposed $500 daily fines.
       Figueroa was indicted in January. Shortly before trial was 
     to begun earlier this month, the defense subpoenaed the 
     alleged victim's file from the local YWCA.
       When the YWCA refused the papers, citing the victim's 
     constitutional right to privacy, Superior Court Judge 
     Constance Sweeney found the group in contempt on June 9 and 
     imposed a $500 daily fine. Effective today, the fine also 
     would have applied to the local YWCA's 12 board members 
     personally.
       The YWCA immediately sought relief from the state Appeals 
     Court, which refused. The state Supreme Judicial Court, 
     acting through a single justice, upheld the contempt ruling 
     Wednesday morning.
       Andrew Klyman, head of the Springfield public defender's 
     office, said his staff, which represents Figueroa, was 
     following a court-ordered procedure for obtaining relevant 
     documents.
       ``What we're looking for is whether the alleged victim is 
     telling the same story to everybody,'' Klyman said. ``If 
     she's telling the truth, she's got nothing to worry about.''
       Mary Reardon Johnson, executive director of the YWCA of 
     Western Massachusetts, said the Springfield chapter had 
     ``used all the resources and means available to us.'' She 
     said any further resistance to the court order could be so 
     costly that it would jeopardize the group's other activities.
       ``We've lost the battle but not the war. We're not done,'' 
     Johnson said, adding that three legislators have agreed to 
     seek a new state confidentiality law.
       The Springfield YWCA's attorney, Wendy Murphy, said the 
     case is important because, while legal advocates have been 
     seeking and winning legal protections for rape counselors in 
     recent years, only a handful of states grant them a legal 
     confidentiality comparable to that of a doctor or priest.
       ``Rape crisis centers can't function without 
     confidentiality,'' Murphy said. She said the YWCA was not 
     seeking an absolute privilege.
       Now, she said, defense attorneys may request the files and 
     judges must order their release if the judge finds them 
     ``relevant.'' Instead, Murphy said, defendants should face a 
     higher standard and be able to obtain rape crisis files only 
     if they can show a ``material need'' to have the documents.
       ``In effect, the rule forces victims to choose between 
     prosecution and healing. If they choose prosecution, they 
     must suffer in silence,'' Murphy said. The lower standard 
     allows defense attorneys to seek ``victory by intimidation,'' 
     she said.
       The attorney also complained that the private, nonprofit 
     YWCA would have faced nearly $250,000 in fines during the 
     year it would take to have the organization's views heard 
     through a formal appeal.
       YWCA officials said more than 1 million girls and women 
     receive counseling for rape and domestic violence at more 
     than 300 YWCAs annually.
                                 ______

      By Mr. MITCHELL:
  S. 2241. A bill to establish a Gulf of Maine Council to promote the 
economic development and ensure the environmental quality of the Gulf 
of Maine, and for other purposes; to the Committee on Environment and 
Public Works.


                     the gulf of maine act of 1994

  Mr. MITCHELL. Mr. President, today I am introducing the Gulf of Maine 
Act of 1994. This legislation is identical to a bill introduced by 
Representatives Andrews and Studds in the House of Representatives.
  The Gulf of Maine is a semienclosed sea bordered by the States of 
Maine, Massachusetts, and New Hampshire, and the Provinces of New 
Brunswick and Nova Scotia.
  My home State of Maine has over 3,000 miles of coastline bordering 
the gulf. Commercial fishing is an important part of Maine's economy 
and way of life. Recreational fishing and wildlife dependent tourism 
activities are becoming increasingly valuable to the region. Here are 
some facts about the Gulf of Maine:
  Commercial fisheries in the gulf are valued at over $800 million each 
year;
  The value of the aquaculture industry in the gulf region is about $60 
million and rapidly increasing;
  Some 75 million people live within 1 day's drive of the gulf;
  Approximately $6 billion is spent by about 10 million tourists 
visiting the region each year;
  The gulf region contains three national parks and one marine 
sanctuary;
  The gulf supports a wide range of species: 100 species of birds, 73 
species of fish, and 26 types of whales, porpoises, and seals, 
including 30 federally listed endangered and threatened species such as 
the humpback whale and the bald eagle.
  All these statistics would lead one to believe that the Gulf of Maine 
is a pristine and healthy ecosystem. In many ways, it is one of the 
most productive marine ecosystems in our Nation. Unfortunately, there 
is growing evidence of environmental contamination, loss of habitat, 
and species decline in the Gulf of Maine. Unusually high levels of 
toxins in the tamale of lobsters, PCB's and heavy metals in the 
sediments gulf-wide, decreased harvests of shellfish in Downeast Maine, 
and increased coastal development all threaten the environmental and 
economic health of the region.
  I have long been concerned about coastal and marine issues. As a 
member of the Environment and Public Works Committee, I held hearings 
on environmental trends in the Gulf of Maine in 1987 and 1988. I have 
sponsored marine reserach and coastal protection legislation. I have 
worked with the fishing community in Maine to ensure that Maine 
families will continue to benefit from the bounty of the Gulf of Maine. 
I have authored wetlands conservation and oilspill prevention 
legislation.
  But although much good work has been done in the gulf by a variety of 
interests, it is becoming clear that a better coordinated strategy for 
the Gulf of Maine is necessary. The legislation I am introducing today 
provides a coordinating mechanism for the various entities in the 
region working toward protecting the environment quality and economic 
resources of the Gulf of Maine.
  The legislation authorizes a Gulf of Maine Council to be comprised of 
representatives appointed by the Governors of the three States and ex-
officio representatives of the two Canadian Provinces. The council will 
develop a Gulf of Maine agreement which will establish general goals 
and priorities to guide efforts to protect and manage the gulf over a 
10-year period.
  The council will facilitate coordination among governments and 
nongovernment organizations regarding management of the gulf in four 
key subject areas:
  Environmental assessment and management.--The legislation establishes 
a program to coordinate environmental assessment and management efforts 
in the gulf.
  Economic assistance.--The legislation creates an Economic Development 
Board to coordinate sustainable economic development activities in the 
Gulf of Maine region. The Board will identify projects and activities 
with the greatest potential of furthering the economic and 
environmental health of the region.
  Fisheries management.--The council will make recommendations to the 
New England Fisheries Management Council and provide the management 
council with relevant information being collected by other entities 
working under the umbrella of the Gulf of Maine Council.
  Marine research.--The council will work with the existing Gulf of 
Maine Regional Marine Research Board to integrate its research efforts 
with related management efforts.
  The legislation also will facilitate environmental education 
activities in the gulf and creates a citizen advisory group to ensure 
broad input into council activities.
  Citizens and governments of the Gulf of Maine region need a mechanism 
through which they can express their diverse opinions and set forth a 
vision for an environmentally and economically healthy Gulf of Maine 
region. I hope that my colleagues, particularly my colleagues from the 
Gulf of Maine region, will join me in supporting this legislation.
  Mr. President, I ask unanimous consent that the bill be printed in 
the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2241

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Gulf of Maine Act of 1994''.

     SEC. 2. FINDINGS.

       (a) Economic Findings.--Congress makes the following 
     findings regarding economic activities in the Gulf of Maine 
     region:
       (1) The Gulf provides significant commercial benefits to 
     the United States and Canada. The commercial fishing industry 
     of the Gulf is valued at more than $800,000,000. 
     Approximately 20,000 United States and Canadian citizens fish 
     the marine resources of the Gulf.
       (2) The Gulf is an important recreational resource because 
     the Gulf--
       (A) is within 1 day's drive of 75,600,000 people;
       (B) contains 3 United States and Canadian national parks 
     and 1 United States national marine sanctuary; and
       (C) attracts approximately 10,000,000 visitors annually.
       (3) The Gulf provides diverse livelihoods ranging from 
     tourism-based employment to seaweed harvesting.
       (b) Ecological Findings.--Congress makes the following 
     findings regarding the ecological status of the Gulf of Maine 
     region:
       (1) The Gulf supports a wide diversity of marine life, 
     including 100 species of birds, 73 species of fish, and 26 
     types of whales, porpoises, and seals, including 30 federally 
     listed endangered species including the bald eagle, sea 
     turtle, humpback whale, and sperm whale.
       (2) The Gulf of Maine region is experiencing environmental 
     problems, including--
       (A) high levels of toxic contaminants in deep basin 
     sediments of the Gulf, as well as in organisms within the 
     Gulf of Maine ecosystem, including the bald eagle and the 
     American lobster;
       (B) concerns about human health that have resulted in the 
     closure of about \1/3\ of Gulf shellfish beds, resulting in 
     economic losses in communities around the Gulf;
       (C) the increasing loss of habitat in the Gulf region, 
     which results in diminished coastal and estuarine habitats 
     important to migratory waterfowl and commercially valuable 
     fish species; and
       (D) the escalating impact of recreational use on the Gulf 
     ecosystem.
       (c) Management Findings.--Congress makes the following 
     findings regarding the management of the Gulf of Maine 
     region:
       (1) The natural resources of the Gulf are interconnected, 
     forming an ecosystem that transcends political boundaries and 
     that is a public resource that needs national attention.
       (2) The efforts of the States of Maine, Massachusetts, and 
     New Hampshire, and of the Canadian Provinces of Nova Scotia 
     and New Brunswick, to form a Gulf of Maine Council on the 
     Marine Environment have laid a foundation for future efforts 
     to protect and conserve the Gulf.
       (3) There is a need to continue and expand the research, 
     monitoring, management, and development activities within the 
     Gulf and to coordinate the activities.

     SEC. 3. DEFINITIONS.

       As used in this Act:
       (1) Administrator.--The term ``Administrator'' means the 
     Administrator of the Environmental Protection Agency.
       (2) Agreement.--The term ``Agreement'' means the Gulf of 
     Maine Agreement developed under section 4(c)(1).
       (3) Commission.--The term ``Commission'' means the St. 
     Croix International Waterway Commission established under 
     chapter 8 of title 38 of the Maine Revised Statutes.
       (4) Gulf of maine council.--The terms ``Gulf of Maine 
     Council'' and ``Council'' mean the Gulf of Maine Council 
     established under section 4.
       (5) Gulf of maine region.--The term ``Gulf of Maine 
     region'' means the Bay of Fundy, the Gulf of Maine, including 
     Georges Bank, and the streams, rivers, lakes, and other 
     bodies of water, and the associated land mass of the bodies 
     of water, within the drainage basin of the Gulf of Maine, 
     together with the ecological community of the Gulf of Maine.
       (6) Management council.--The term ``Management Council'' 
     means the New England Fishery Management Council established 
     under section 302(a)(1) of the Magnuson Fishery Conservation 
     and Management Act (16 U.S.C. 1852(a)(1)).
       (7) Secretary.--The term ``Secretary'' means the Secretary 
     of Commerce.

     SEC. 4. GULF OF MAINE COUNCIL.

       (a) Establishment.--
       (1) In general.--There is authorized to be established a 
     Gulf of Maine Council to promote the environmental and 
     economic health of the Gulf of Maine region.
       (2) Purpose.--The purpose of the Gulf of Maine Council 
     shall be to facilitate the coordination of governmental and 
     nongovernmental activities related to the Gulf of Maine 
     region, including--
       (A) economic development, including the coordination and 
     prioritization of applications for assistance submitted under 
     section 5;
       (B) environmental assessment and management;
       (C) fisheries habitat improvement and management;
       (D) marine research; and
       (E) education and understanding concerning ecological and 
     cultural resources.
       (3) Initial organization.--On receiving a written agreement 
     of the Governors of Maine, Massachusetts, and New Hampshire, 
     and the Premiers of Nova Scotia and New Brunswick, that is 
     jointly signed by each such Governor and Premier, to 
     establish the Gulf of Maine Council in accordance with this 
     section, and the nominations of the Governors and the 
     Premiers to the Gulf of Maine Council, Congress shall 
     consider the Gulf of Maine Council to be established.
       (4) Federal advisory committee act.--The Federal Advisory 
     Committee Act (5 U.S.C. App. 2) shall not apply to any entity 
     established under this Act.
       (b) Membership, Authority, and Funding of Council.--
       (1) Membership and personnel.--
       (A) Membership.--Not later than 180 days after the date of 
     enactment of this Act, the Governors of Maine, Massachusetts, 
     and New Hampshire and the Premiers of Nova Scotia and New 
     Brunswick shall each appoint 3 representatives to the Gulf of 
     Maine Council. The representatives of the Provinces shall be 
     ex officio members of the Council.
       (B) Terms.--The term of each member of the Gulf of Maine 
     Council shall be 3 years, except that, in the case of initial 
     appointments, the Governors and Premiers shall each appoint 1 
     member to a term of 2 years, 1 member to a term of 3 years, 
     and 1 member to a term of 4 years.
       (C) Executive secretary and staff.--The Gulf of Maine 
     Council may employ an executive secretary and such support 
     staff as are necessary to assist the Council, and the Boards 
     and Councils referred to in sections 5 through 8, in carrying 
     out their duties, including the coordination of plans and 
     programs developed under sections 5 through 8.
       (D) Travel expenses.--A member of the Gulf of Maine Council 
     who is not an employee of the Federal Government or a State 
     government, while away from the home or regular place of 
     business of the member in performing a duty of the Council, 
     shall be allowed travel expenses, including per diem in lieu 
     of subsistence, in the same manner as a person employed 
     intermittently in the Government service is allowed expenses 
     under section 5703 of title 5, United States Code.
       (2) Decisionmaking.--The Gulf of Maine Council--
       (A) may establish such bylaws and decisionmaking processes 
     as the Council determines are necessary; and
       (B) shall meet not less often than annually.
       (3) Financial support.--
       (A) In general.--
       (i) Annual budget.--The Gulf of Maine Council shall 
     annually adopt by consensus a budget for the activities of 
     the Council.
       (ii) State support.--Each State represented on the Gulf of 
     Maine Council shall provide to the Council a payment in an 
     amount equal to the quotient obtained by dividing--

       (I) the United States portion of the budget adopted under 
     clause (i); by
       (II) the number of States represented on the Council.

       (iii) Federal contributions.--The Government of the United 
     States may make the payment required of a State under clause 
     (ii).
       (B) Supplemental funding.--The Gulf of Maine Council may 
     accept, from the Government of the United States, the 
     Government of Canada, other agencies, corporations, 
     organizations, and individuals, funds for activities or 
     projects to supplement funds made available to the Council 
     under subparagraph (A).
       (4) Gulf of maine advisory group.--
       (A) In general.--The Gulf of Maine Council shall establish 
     a Gulf of Maine Advisory Group (referred to in this section 
     as the ``Advisory Group'') to advise the Council, the 
     Governors of Maine, Massachusetts, and New Hampshire, and the 
     Premiers of Nova Scotia and New Brunswick on the 
     implementation of this Act.
       (B) Composition.--The members of the Advisory Group shall 
     be appointed by the Governors and Premiers in coordination 
     with the Gulf of Maine Council and shall include not more 
     than 15 members, including representatives of the public, the 
     fishing community, the scientific community, nonprofit 
     organizations, and local governments.
       (c) Gulf of Maine Agreement.--
       (1) In general.--Not later than 2 years after the date of 
     enactment of this Act, the Gulf of Maine Council shall 
     develop and adopt a Gulf of Maine Agreement. The Agreement 
     shall set forth general priorities and guidelines for the 
     protection, assessment, management, and sustainable 
     development of the Gulf of Maine region for the 10 years 
     after the date of adoption of the Agreement. The Gulf of 
     Maine Council shall oversee the implementation of the 
     Agreement.
       (2) Elements of agreement.--The Agreement shall, at a 
     minimum--
       (A) describe long-term goals for environmental protection 
     and sustainable economic development in the Gulf of Maine 
     region;
       (B) identify opportunities for improved coordination of 
     activities relating to--
       (i) economic development;
       (ii) fisheries management;
       (iii) environmental assessment and protection;
       (iv) marine research; and
       (v) education;
       (C) be consistent with all relevant Federal and State laws;
       (D) incorporate, to the maximum extent practicable, ongoing 
     planning efforts being conducted by coastal communities and 
     members of the fishing community;
       (E) establish parameters and criteria to monitor and 
     evaluate the effectiveness of actions taken under this Act 
     and measures to respond to evaluation results; and
       (F) facilitate and coordinate public education and 
     awareness concerning the environment and economy of the Gulf 
     of Maine region.
       (3) Review.--
       (A) Advisory group.--The Gulf of Maine Council shall 
     provide for the participation of the Advisory Group in the 
     development of the Agreement.
       (B) Public review and comment.--The Gulf of Maine Council 
     shall provide for public review and comment on the Agreement 
     prior to adoption, including, at a minimum, a public hearing 
     in each State and Province represented on the Gulf of Maine 
     Council.
       (4) Adoption.--After considering the comments of the 
     Advisory Group and the public, the Gulf of Maine Council 
     shall make appropriate changes to the Agreement and adopt the 
     Agreement with appropriate implementation mechanisms if the 
     Agreement is consistent with this Act.
       (5) Progress report and revision of agreement.--Not later 
     than 5 years after the date of adoption of the Agreement, the 
     Gulf of Maine Council shall prepare a report that assesses 
     the extent of progress in attaining the goals of this Act and 
     make such revisions to the Agreement and the structure of the 
     Council as the Council determines are appropriate. The report 
     shall identify opportunities to enhance mutual cooperation 
     and coordination between the United States and Canada 
     concerning the Gulf of Maine region. The report shall be 
     submitted to Congress, the Secretary, the Secretary of the 
     Interior, the Administrator, and the heads of other 
     appropriate Federal, State, and local agencies and 
     organizations.
       (6) Extent of authority.--
       (A) In general.--Subject to subparagraph (C), the Gulf of 
     Maine Council may review, to the extent consistent with 
     applicable law, the activities of international, Federal, 
     State, and Provincial entities in the Gulf of Maine region 
     and make recommendations to the entities regarding the 
     compatibility of the activities with the Agreement.
       (B) Review of plans.--The Gulf of Maine Council shall 
     review plans prepared by the Boards and Councils referred to 
     in sections 5 through 8 to ensure that the plans are 
     consistent with each other and with the goals and priorities 
     established in the Agreement.
       (C) Limitations.--No action or recommendation authorized 
     under this section--
       (i) binds or obligates any department, agency, officer, or 
     Act of the Federal Government, any State government, any 
     Indian tribe, or any international entity established by 
     treaty with authority relating to the Gulf of Maine region, 
     unless this Act specifically provides otherwise; or
       (ii) limits the authority of the United States to enter 
     into treaties.
       (d) Report.--Not later than 12 years after the date of 
     enactment of this Act, the Gulf of Maine Council shall submit 
     a report to Congress and the President on the activities of 
     the Gulf of Maine Council and the effectiveness of this Act 
     in promoting the economic and environmental health of the 
     Gulf of Maine region. The report shall include 
     recommendations for such administrative and legislative 
     action as the Council considers advisable.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 5. ECONOMIC ASSISTANCE FOR THE GULF OF MAINE REGION.

       (a) Economic Development Board.--
       (1) Establishment.--The Gulf of Maine Council, in 
     cooperation with the Economic Development Administration and 
     the National Oceanic and Atmospheric Administration of the 
     Department of Commerce, shall establish an Economic 
     Development Board (referred to in this subsection as the 
     ``Board'') to develop and implement a long-term plan for 
     coordinating environmentally sound economic assistance for 
     the Gulf of Maine region provided under this section and from 
     other sources.
       (2) Purpose and duties.--The purpose of the Board shall be 
     to identify economic assistance priorities and projects with 
     the greatest potential to aid the restoration of both the 
     economic and ecological health of the Gulf of Maine region. 
     The Board shall provide grantmaking agencies and 
     organizations with the information referred to in the 
     preceding sentence and shall carry out the responsibilities 
     of the Council referred to in section 4(a)(2)(A).
       (3) Members.--The Board shall consist of such individuals 
     as the members of the Gulf of Maine Council determine are 
     appropriate and should include representatives of the 
     Economic Development Administration, the Office of 
     Sustainable Development, and the Small Business 
     Administration of the Department of Commerce, the Department 
     of Labor, and State agencies and private entities involved in 
     economic development activities in the Gulf of Maine region. 
     The individuals who represent Provinces shall be ex officio 
     members of the Board.
       (4) Annual plan.--The Board shall prepare an annual plan 
     that identifies goals and objectives for environmentally 
     sound economic assistance (including high-priority projects), 
     describes the status of any ongoing projects, and reflects 
     the goals and priorities established in the Agreement. The 
     Board shall provide for public review of and comment on the 
     plan. Prior to release of the plan for public review, the 
     Boards and Councils referred to in sections 6 through 8 shall 
     review and comment on the plan.
       (b) Planning Grants.--
       (1) In general.--In accordance with this subsection, the 
     Secretary may provide planning grants to the Gulf of Maine 
     Council for a period of 1 year for 100 percent of the total 
     project cost, as determined by the Secretary. In carrying out 
     this paragraph, the Secretary may enter into a cooperative 
     agreement with the Council.
       (2) Eligible activities.--A cooperative agreement under 
     this subsection shall be made available through the Economic 
     Development Administration of the Department of Commerce for 
     the planning of economic development programs designed 
     specifically to retain or create full-time permanent jobs and 
     income for individuals who are unemployed or underemployed as 
     a result of the implementation of fishery management 
     regulations imposed by the Federal Government that have a 
     severe economic impact on communities in the Gulf of Maine 
     region.
       (c) Technical Assistance.--
       (1) In general.--In accordance with this subsection, the 
     Secretary may provide grants for local technical assistance 
     to the Gulf of Maine Council through the Economic Development 
     Administration of the Department of Commerce in an amount 
     equal to not more than 75 percent of the total project cost, 
     as determined by the Secretary.
       (2) Eligible activities.--Activities eligible for 
     assistance under this subsection include--
       (A) enabling the building and expansion of local 
     organizational capacity;
       (B) technical or market feasibility studies;
       (C) collecting and disseminating information relevant to 
     diversification efforts, including stock projections, market 
     forecasts, international trade opportunities, and technology 
     needs assessment;
       (D) conversion assistance for new nonfishing occupations, 
     including financial support for regional business development 
     efforts, and technology needs assessment;
       (E) restoration of natural resources, such as the building 
     of fish passages and the restoration of wetlands and 
     shellfish harvesting areas, that will enhance economic 
     opportunities for Gulf of Maine communities; and
       (F) otherwise responding to developmental opportunities for 
     individuals unemployed or underemployed as a result of the 
     implementation of fishery management regulations imposed by 
     the Federal Government that have a severe economic impact on 
     communities in the Gulf of Maine region.
       (d) Eligible Applicants.--
       (1) Grants.--The sole eligible applicant to receive grants 
     under this section shall be the Gulf of Maine Council, on 
     behalf of the Gulf of Maine region which shall be deemed to 
     be an economic development district for the purpose of part B 
     of title IV of the Public Works and Economic Development Act 
     of 1965 (42 U.S.C. 3171 et seq.).
       (2) Subgrants.--The Gulf of Maine Council shall use grants 
     received under this section to provide assistance for 
     activities referred to in this section to eligible 
     applicants, including public and private nonprofit national, 
     State, area, district, and local organizations, units of 
     local government, and public and private colleges and 
     universities.
       (e) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 6. FISHERY MANAGEMENT PLANS.

       (a) Coordination with Existing Program.--
       (1) In general.--The Gulf of Maine Council shall cooperate 
     with the New England Fishery Management Council established 
     under title III of the Magnuson Fishery Conservation and 
     Management Act (16 U.S.C. 1851 et seq.).
       (2) Authority.--The Management Council shall continue to 
     exercise the authorities and responsibilities established in 
     title III of such Act (16 U.S.C. 1851 et seq.) and shall also 
     participate, as described in subsection (b)(1)(A), with the 
     Gulf of Maine Council and with other organizations 
     established under this Act in cooperative efforts to promote 
     the environmental and economic health of the Gulf of Maine 
     region.
       (b) Recommendations by the Gulf of Maine Council.--
       (1) Recommendations.--
       (A) To management council.--The Gulf of Maine Council may, 
     after notice and opportunity for public comment, develop 
     recommendations to submit to the Management Council on any 
     fishery management plan being considered by the Management 
     Council, if the Gulf of Maine Council determines that the 
     recommendations are necessary to make the fishery management 
     plan reflect the goals and priorities established in the 
     Agreement. The recommendations shall be submitted during the 
     applicable public comment period established under title III 
     of the Magnuson Fishery Conservation and Management Act (16 
     U.S.C. 1851 et seq.).
       (B) To secretary.--The Gulf of Maine Council may, after 
     notice and opportunity for public comment, develop 
     recommendations, based on the Agreement, to submit to the 
     Secretary regarding any fishery management plan of the 
     Management Council being considered by the Management Council 
     or submitted to the Secretary, including asking the Secretary 
     to convene a negotiated rulemaking provided for under 
     subchapter III of chapter 5 of title 5, United States Code, 
     for the management plan. The recommendations shall be 
     submitted during the applicable public comment period 
     established under section 304 of the Magnuson Fishery 
     Conservation and Management Act (16 U.S.C. 1854).
       (2) Approval by the council.--The Gulf of Maine Council may 
     submit recommendations under paragraph (1) only if the 
     recommendations are approved by a majority of the voting 
     members of the Gulf of Maine Council.
       (3) Review.--If the Secretary receives recommendations 
     prepared by the Gulf of Maine Council, the Secretary shall 
     commence a review of the recommendations to determine whether 
     the recommendations are necessary to make any fishery 
     management plan consistent with the Agreement.
       (4) Consultation.--In undertaking the review required under 
     paragraph (3), the Secretary shall--
       (A) give careful consideration to the comments and 
     recommendations of the Gulf of Maine Council; and
       (B) provide the Gulf of Maine Council, upon request, the 
     opportunity to meet with and present the comments or 
     recommendations of the Council directly to the Secretary 
     during the applicable public comment period established under 
     section 304 of the Magnuson Fishery Conservation and 
     Management Act (16 U.S.C. 1854).
       (5) Nonacceptance by the secretary.--If the Secretary does 
     not accept the recommendations reviewed under paragraph (3), 
     the Secretary shall specify the reasons the recommendations 
     were not accepted.
       (6) Findings.--Notwithstanding any other law, if the 
     Secretary concurs with the recommendations submitted by the 
     Gulf of Maine Council under this subsection, the Secretary 
     shall issue a finding to the Management Council requesting 
     that the Management Council review the fishery management 
     plan in light of the recommendations of the Gulf of Maine 
     Council not later than 180 days after the issuance of the 
     finding. The Secretary shall also inform the Gulf of Maine 
     Council of the finding.

     SEC. 7. ENVIRONMENTAL MANAGEMENT AND ASSESSMENT PROGRAM.

       (a) Establishment.--
       (1) In general.--There is established an Environmental 
     Management and Assessment Program (referred to in this 
     subsection as the ``Program'') for the Gulf of Maine region.
       (2) Management of program.--
       (A) In general.--The Program shall be managed by the Gulf 
     of Maine Council on the Marine Environment Working Group in 
     existence on the date of enactment of this Act (referred to 
     in this section as the ``Working Group'').
       (B) Members.--The Working Group shall consist of such 
     individuals as the members of the Gulf of Maine Council who 
     represent States determine are appropriate. Membership should 
     include representatives of Federal, State, and local 
     governments and nonprofit organizations that have 
     environmental management and assessment programs in the Gulf 
     of Maine region.
       (3) Participation in the program.--The Gulf of Maine 
     Council shall ensure that--
       (A) all Federal and State agencies that have environmental 
     management and assessment programs in the Gulf of Maine 
     region have an opportunity to participate in the Program; and
       (B) the Program includes representation of the 
     environmental management and assessment efforts being carried 
     out by nongovernmental entities in the Gulf of Maine region.
       (b) Environmental Management and Assessment Plan.--
       (1) In general.--Not later than 2 years after the Agreement 
     is adopted, and after providing for public review and 
     comment, the Working Group shall publish a plan for improved 
     environmental management and assessment in the Gulf of Maine 
     region. Prior to release of the plan for public review, the 
     Boards and Councils referred to in sections 5, 6, and 8 shall 
     review and comment on the plan.
       (2) Contents of plan.--The plan required under paragraph 
     (1) shall--
       (A) establish a comprehensive program for the long-term 
     monitoring and assessment of the Gulf of Maine region, based 
     on the Gulf of Maine Monitoring Plan established in 1990 by 
     the Governors of Maine, Massachusetts, and New Hampshire, and 
     the Premiers of Nova Scotia and New Brunswick;
       (B) identify environmental protection and management 
     programs being carried out in the Gulf of Maine region and 
     make recommendations for improving the effectiveness of the 
     programs and coordination among programs;
       (C) identify and monitor priority habitat for the fish and 
     wildlife species in the Gulf of Maine region and recommend 
     measures for habitat conservation, including protection and 
     restoration; and
       (D) reflect the goals and priorities established in the 
     Agreement.
       (3) Planning and implementation grants.--The Administrator, 
     the Secretary of Commerce, and the Secretary of the Interior 
     may provide planning and implementation grants to the Gulf of 
     Maine Council in an amount equal to not more than 75 percent 
     of the total project cost, as determined by the Administrator 
     or the Secretary, respectively, for planning and implementing 
     environmental management and assessment projects under this 
     section. In carrying out this paragraph, the Administrator 
     and each Secretary may enter into a cooperative agreement 
     with the Council.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as are necessary to carry out 
     this section.

     SEC. 8. GULF OF MAINE RESEARCH.

       (a) Coordination With Existing Program.--
       (1) In general.--The Gulf of Maine Council shall cooperate 
     with the Regional Marine Research Board for the Gulf of Maine 
     region established under title IV of the Marine Protection, 
     Research, and Sanctuaries Act of 1972 (16 U.S.C. 1447 et 
     seq.) and the Regional Association for Research on the Gulf 
     of Maine.
       (2) New authority.--The Regional Marine Research Board for 
     the Gulf of Maine region shall continue to exercise the 
     authorities and responsibilities established in title IV of 
     such Act (16 U.S.C. 1447 et seq.) and shall also participate 
     with the Gulf of Maine Council and with other organizations 
     established under this Act in cooperative efforts to promote 
     the environmental and economic health of the Gulf of Maine 
     region.
       (3) Regional marine research plans.--
       (A) Schedules.--The Regional Marine Research Board for the 
     Gulf of Maine region may, in cooperation with the Gulf of 
     Maine Council and with the approval of the Secretary, revise 
     schedules for the development of research plans under section 
     404 of such Act (16 U.S.C. 1447c) as appropriate to ensure 
     the effective coordination of the plans and programs carried 
     out under such Act with the activities and plans carried out 
     under this Act.
       (B) Goals and priorities.--The research plans referred to 
     in subparagraph (A) shall reflect the goals and priorities 
     established in the Agreement. Each research plan shall be 
     reviewed by the Boards and Councils referred to in sections 5 
     through 7 prior to approval of the plan.
       (4) Continuation of program.--Notwithstanding section 
     403(f) of the Marine Protection, Research, and Sanctuaries 
     Act of 1972 (16 U.S.C. 1447b(f)), the Regional Marine 
     Research Board for the Gulf of Maine region shall continue to 
     exist until the termination date specified in section 10.
       (b) Membership.--
       (1) Current structure.--The membership of the Regional 
     Marine Research Board for the Gulf of Maine region shall be 
     as established under section 403 of such Act (16 U.S.C. 
     1447b).
       (2) Research advisory group.--The Gulf of Maine Council may 
     establish a Gulf of Maine Research Advisory Group consisting 
     of such individuals as the members of the Gulf of Maine 
     Council who represent Provinces identify as appropriate to 
     represent the marine research interests, including fisheries 
     science and environmental quality, of the Provinces. The 
     members of the Research Advisory Group shall, to the extent 
     practicable, be selected in a manner consistent with 
     paragraphs (1) and (2) of section 403(b) of such Act (16 
     U.S.C. 1447b(b)).
       (c) Authorization of Appropriations.--Notwithstanding 
     section 407 of such Act (16 U.S.C. 1447f), there are 
     authorized to be appropriated such sums as are necessary to 
     carry out this section.

     SEC. 9. ST. CROIX INTERNATIONAL WATERWAY COMMISSION.

       (a) In General.--The Administrator may award grants to the 
     St. Croix International Waterway Commission to support the 
     activities of the Commission.
       (b) Federal Share.--
       (1) In general.--The Federal share of a grant awarded under 
     this section shall be 50 percent of the amount of the grant 
     award.
       (2) Non-federal share.--The non-Federal share of a grant 
     awarded under this section shall be 50 percent of the amount 
     of the grant award. Any person, including the State of Maine, 
     the Province of New Brunswick, the Government of Canada, or 
     any political subdivision thereof, may pay the non-Federal 
     share.
       (c) Reports.--
       (1) Submission by commission.--As a condition of receiving 
     a grant award under this section, the Commission shall submit 
     to the Administrator, by a date specified by the 
     Administrator, an annual report on the activities of the 
     Commission and the use by the Commission of the grant award.
       (2) Submission by administrator.--As soon as practicable 
     after receipt of the report under paragraph (1), the 
     Administrator shall submit a copy of the report and any 
     written recommendations concerning the report to the 
     Committee on Environment and Public Works of the Senate and 
     the Committee on Public Works and Transportation of the House 
     of Representatives.
       (d) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Environmental Protection Agency to 
     carry out this section $100,000 for each of fiscal years 1995 
     through 2000.

     SEC. 10. TERMINATION OF AUTHORITY.

       The authority provided by this Act (except for section 9) 
     shall terminate on the date that is 13 years after the date 
     of enactment of this Act.
                                 ______

      By Mr. STEVENS (for himself, Mrs. Murray, Mr. Gorton, Mr. 
        Murkowski, and Mr. Packwood):
  S. 2243. A bill to amend the Fishermen's Protective Act of 1967 to 
permit reimbursement of fishermen for fees required by a foreign 
government to be paid in advance in order to navigate in the waters of 
that foreign country whenever the United States considers that fee to 
be inconsistent with international law, and for other purposes; ordered 
held at the desk.


            the fishermen's protective act amendment of 1994

  Mr. STEVENS. Mr. President, today the White House had a briefing for 
those of us from the West Coast on the issue of negotiations on the 
salmon treaty with Canada. I am pleased to report that the Vice 
President has met with the Canadian Ambassador, Ambassador Chretien. I 
quote from a State Department release today which says: ``The Vice 
President and Ambassador Chretien had a frank, candid and constructive 
discussion of the Pacific salmon issue.''
  It was clear to us that there is an attempt to resolve the issue of 
the fees that have been imposed by Canada on American fishermen 
transiting Canadian waters to get to Alaska fishing grounds. We are 
hopeful this will be resolved soon.
  I am pleased the Vice President is giving his direct personal 
attention to this issue, which is of great concern to the residents of 
the West Coast in general, and to my constituents in particular.
  I ask unanimous consent I be permitted to introduce for myself and 
Senator Murray, Senator Gorton, Senator Murkowski, and Senator 
Packwood, a bill to amend the Fishermen's Protective Act of 1967 to 
permit reimbursement of fishermen for fees imposed by Canada on them in 
order to have the privilege of transiting Canadian waters to get to 
Alaska. That, in my opinion as someone who has been involved with 
maritime law for years, is not a valid imposition of fees by Canada. It 
is contrary to the traditions of the uniform maritime laws. And I hope 
we will be able to convince our neighbors--northern neighbors to some, 
southern neighbors to me--that they should desist from the practice of 
imposing these transit fees on our fishermen as they go back and forth 
through Canadian waters after the fishing is over, and in order to get 
to our State to fish in the first place.
  I hope Members who are interested in this issue will join me in 
stating that we will be very persistent in our feeling that the fee 
issue ought to be resolved before we return to the bargaining table on 
the salmon treaty.
  Mr. President, I do wish to thank Eileen Claussen of the National 
Security Council, Kathleen McGinty of the White House Office of 
Environmental Policy, Doug Hall of NOAA, and Greg Burton of the State 
Department for their consideration.
  With regard to the bill that I have introduced, I would ask that the 
clerk not refer that yet. We are trying to work out an arrangement to 
see if we can hold that at the desk. It is a bipartisan bill of great 
urgency to Pacific State Senators.
  This fee issue ought to be resolved and we ought to let our Canadian 
neighbors know that we will not pay tribute to our northern neighbor.
  Mr. President, I ask unanimous consent that the announcement of the 
State Department concerning what happened at the negotiations between 
the Vice President and the Canadian Ambassador be printed in the 
Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

       Question. What happened at the meeting between Vice 
     President Gore and Canadian Ambassador Chretien regarding 
     Pacific salmon?
       Answer. The Vice President and Ambassador Chretien had a 
     frank, candid, and constructive discussion of the Pacific 
     salmon issue. The Vice President reiterated the U.S. position 
     that the Canadian fee on U.S. fishing vessels is 
     unacceptable. The Vice President assured the Ambassador that 
     this matter would continue to receive White House attention, 
     and both agreed that a resolution is required very soon. 
     Ambassador Chretien agreed to convey the Vice President's 
     message immediately to his authorities in Ottawa. Both the 
     Vice President and Ambassador Chretien expressed the view 
     that the negotiations should be resumed and intensified with 
     new resolve and determination to succeed.

 Mr. MURKOWSKI. Mr. President, this bill is a measured, 
appropriate response to actions taken by Canadian officials that are, 
in the words of Canada's Fisheries Minister, ``to Canada's advantage 
and the United States' disadvantage''.
  I am very pleased to join other members of the Senate from the 
Pacific Northwest and Alaska in introducing this measure. It will both 
provide guidance to the administration as it deals with Canada, and 
respond to serious problems arising from Canadian Government action.
  Canada has attempted to influence the United States posture in 
ongoing negotiations under the Pacific Salmon Treaty by establishing a 
transit license for United States fishing vessels passing through the 
Inside Passage to and from Alaska.
  This license, which costs each American vessel approximately $1,100 
each time the captain uses the Inside Passage, is clearly illegal under 
international law, under bilateral fishing treaties on halibut and 
albacore tuna, under the North American Free-Trade Agreement and under 
the General Agreement on Tariffs and Trade.
  In addition, by forcing more small U.S. vessels to consider traveling 
to and from Alaska in the unsheltered outside waters of the ocean, it 
contributes to a very real danger for U.S. citizens.
  Mr. President, let me note that I do not like the idea of anyone 
paying this Canadian charge--whether United States fisherman or United 
States Government. Such a fee is strictly illegal, and I am confident 
that Canada will have to accept this fact and ultimately will reimburse 
those who were forced to pay it.
  However, the important thing right now is to avoid disruptions in 
U.S. fisheries by ensuring that all American fishermen needing to use 
the Inside Passage will be able to do so. This bill will accomplish 
that by amending the Fishermen's Protective Act to allow the State 
Department to reimburse vessel owners for their costs.
  We are also strongly suggesting that the administration review its 
current policy with regard to allowing Canadian fishing vessels 
virtually unrestricted access to anchorages in United States waters in 
Alaska--a privilege not reciprocally offered to United States vessels 
by the Government of Canada.
  We are also asking the administration to ensure that the safety and 
economic opportunities of U.S. citizens are protected along the border, 
in order to guard against any incident that would make a final solution 
to the treaty process even harder to attain.
  Mr. President, Vice President Gore recently met with the Canadian 
Ambassador to the United States to inform him that the United States 
considers the transit license to be illegal and to urge that Canada 
repeal it. I have also spoken with the Vice President, and have 
strongly recommended that no further talks be held with Canada until 
the transit license has been withdrawn. We in the United States are not 
in the habit of negotiating with an opponent who is attempting to 
threaten us. The proper way to resolve these issues is at the 
bargaining table, but it was Canada that walked away, and Canada that 
must return. As soon as the transit license is rescinded, they will be 
welcome.
                                 ______

      By Mr. MOYNIHAN (for himself and Mr. D'Amato):
  S.J. Res. 204. A joint resolution recognizing the American Academy in 
Rome, an American overseas center for independent study and advanced 
research, on the occasion of the 100th anniversary of its founding; to 
the Committee on the Judiciary.


         the 100th anniversary of the american academy in rome.

 Mr. MOYNIHAN. Mr. President, I introduce a joint resolution 
recognizing the American Academy in Rome, on the 100th anniversary of 
its founding, for fostering international cultural relations between 
Italy and the United States and for contributing to the development of 
America's cultural and intellectual life. At its inception, the academy 
became the premier American overseas center for the study of the fine 
arts and the humanities. Over the course of its history, it has 
expanded upon that tradition to now serve over 3,000 people annually 
with programs ranging from fellowships and residencies to concerts and 
symposia, and with its renowned research library.
  Through the awarding of its Rome Prize Fellowship, the academy has 
remained committed to its central purpose of identifying and fostering 
the most gifted and promising American talent. Over 2,500 fellowships 
and residencies have been awarded, providing participants the 
opportunity to develop and refine their talents in the fine arts and 
the humanities through independent projects and through interaction 
with the Italian and European scholarly and artistic communities.
  The academy can claim 4 United States Poets Laureate, 2 Nobel Prize 
winners, 7 National Medal of Arts winners, 9 MacArthur fellows, 30 
Pulitzer Prize winners, and numerous other distinguished alumni.
  The American Academy in Rome can take special pride in its 
accomplishments in Roman archeology, having been committed to this 
lofty and exacting pursuit from the academy's very inception. The 
academy's excavations at Cosa in Etruria vastly expanded our 
understanding of the history of Roman republican architecture and town 
planning.
  Funding for the Academy in Rome comes entirely from its endowment and 
from the financial support of philanthropic individuals, foundations, 
corporations, universities and colleges across the United States, and 
from the National Endowment for the Arts and for the Humanities. The 
academy is committed to ensuring the availability of the Rome Prize 
Fellowships to future generations of Americans as the United States 
approaches the 21st century.
  Mr. President, this is a joint resolution to recognize, on the 100th 
anniversary of its founding, the American Academy in Rome. The academy 
plays a pivotal role in the transference of culture between the United 
States and Italy, fostering international cultural relations between 
the two countries and contributing mightily to the cultural and 
intellectual life of America.

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