[Congressional Record Volume 151, Number 104 (Wednesday, July 27, 2005)]
[House]
[Pages H6671-H6673]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            CONTROLLED SUBSTANCES EXPORT REFORM ACT OF 2005

  Mr. DEAL of Georgia. Mr. Speaker, I move to suspend the rules and 
pass the Senate bill (S. 1395) to amend the Controlled Substances 
Import and Export Act to provide authority for the Attorney General to 
authorize the export of controlled substances from the United States to 
another country for subsequent export from that country to a second 
country, if certain conditions and safeguards are satisfied.
  The Clerk read as follows:

                                S. 1395

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

     SECTION 1. REEXPORTATION OF CONTROLLED SUBSTANCES.

       (a) Short Title.--This Act may be cited as the ``Controlled 
     Substances Export Reform Act of 2005''.
       (b) In General.--Section 1003 of the Controlled Substances 
     Import and Export Act (21 U.S.C. 953) is amended by adding at 
     the end the following:
       ``(f) Notwithstanding subsections (a)(4) and (c)(3), the 
     Attorney General may authorize any controlled substance that 
     is in schedule I or II, or is a narcotic drug in schedule III 
     or IV, to be exported from the United States to a country for 
     subsequent export from that country to another country, if 
     each of the following conditions is met:
       ``(1) Both the country to which the controlled substance is 
     exported from the United States (referred to in this 
     subsection as the `first country') and the country to which 
     the controlled substance is exported from the first country 
     (referred to in this subsection as the `second country') are 
     parties to the Single Convention on Narcotic Drugs, 1961, and 
     the Convention on Psychotropic Substances, 1971.
       ``(2) The first country and the second country have each 
     instituted and maintain, in conformity with such Conventions, 
     a system of controls of imports of controlled substances 
     which the Attorney General deems adequate.
       ``(3) With respect to the first country, the controlled 
     substance is consigned to a holder of such permits or 
     licenses as may be required under the laws of such country, 
     and a permit or license to import the controlled substance 
     has been issued by the country.
       ``(4) With respect to the second country, substantial 
     evidence is furnished to the Attorney General by the person 
     who will export the controlled substance from the United 
     States that--
       ``(A) the controlled substance is to be consigned to a 
     holder of such permits or licenses as may be required under 
     the laws of such country, and a permit or license to import 
     the controlled substance is to be issued by the country; and
       ``(B) the controlled substance is to be applied exclusively 
     to medical, scientific, or other legitimate uses within the 
     country.
       ``(5) The controlled substance will not be exported from 
     the second country.
       ``(6) Within 30 days after the controlled substance is 
     exported from the first country to the second country, the 
     person who exported the controlled substance from the United 
     States delivers to the Attorney General documentation 
     certifying that such export from the first country has 
     occurred.
       ``(7) A permit to export the controlled substance from the 
     United States has been issued by the Attorney General.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Georgia (Mr. Deal) and the gentleman from Ohio (Mr. Brown) each will 
control 20 minutes.
  The Chair recognizes the gentleman from Georgia (Mr. Deal).


                             General Leave

  Mr. DEAL of Georgia. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks and include extraneous material on S. 1395.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Georgia?
  There was no objection.
  Mr. DEAL of Georgia. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, S. 1395, the Controlled Substances Export Reform Act of 
2005, is simply about allowing companies to better compete in the 
global marketplace.
  Under the Controlled Substances Import and Export Act, a company is 
not allowed to export controlled substances to one country and then 
send it to a third country. Companies that export controlled substances 
must make a large number of long-distance, small shipments to 
individual countries, incurring large shipping costs. Due to this 
restriction, American manufacturers are less competitive than their 
foreign competitors, which results in high-paying U.S. jobs being sent 
overseas.
  S. 1395 will enable U.S. companies to export products more 
efficiently by allowing them to send a large shipment to one nation 
overseas and from there to distribute smaller shipments to other 
countries. All subsequent transfers of controlled substances would 
still be subject to strict oversight by the DEA and will require a 
permit from the Attorney General to prevent any potential abuse.
  Both the Committee on Energy and Commerce and the Committee on the 
Judiciary have reported the House companion legislation to this bill 
earlier this year. I would like to thank the gentleman from 
Pennsylvania (Mr. Pitts), a member of the Committee on Energy and 
Commerce, for his work on this issue.
  I urge my colleagues to support this needed legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BROWN of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, before yielding to my friend from Guam, I would like to 
make a couple of opening comments. The Controlled Substances Import and 
Export Reform Act is commonsense legislation that would lift 
unnecessary barriers to the export of controlled substances.
  I was pleased to join my colleague on the Committee on Energy and 
Commerce, the gentleman from Pennsylvania (Mr. Pitts), as a sponsor of 
this legislation.
  Our bill expands the U.S. role in an important export while 
maintaining safeguards to prevent illegal diversion of controlled 
substances. The key provisions of this bill create a regulatory 
mechanism by which U.S. exporters can ship controlled substances 
efficiently from one country to another,

[[Page H6672]]

enabling those companies to compete on a global scale.
  The Drug Enforcement Administration worked with us on this 
legislation to ensure sufficient protections for consumers and 
safeguards against illegal activity. I thank the gentleman from 
Pennsylvania (Mr. Pitts) and his staff for their work on this bill. I 
am pleased to support its passage.
  Mr. Speaker, I yield such time as she may consume to the gentlewoman 
from Guam (Ms. Bordallo).
  Ms. BORDALLO. Mr. Speaker, I wish to speak very briefly on H.R. 3204.
  The cost of providing health care in the territories is relatively 
high, and corresponding insurance rates are high due to the number of 
factors, including high levels of chronic disease in small populations 
over which to spread risk.
  H.R. 3204 authorizes Federal seed funding and additional grants to 
the 50 States and the District of Columbia for the purposes of 
initiating and operating high-risk pools, but, Mr. Speaker, 
unfortunately, it fails to include the U.S. territories. I want to 
thank my colleague, the gentlewoman from the Virgin Islands (Mrs. 
Christensen), who was here speaking on my behalf earlier. I also want 
to thank the gentleman from Georgia (Mr. Deal) and the gentleman from 
Ohio (Mr. Brown).
  I respectfully request the gentleman's assistance and the attention 
of our colleague, the gentleman from Ohio (Mr. Brown) in working to add 
the territories as eligible recipients of this funding as this bill 
moves through the rest of the legislative process and in any conference 
with the Senate on this reauthorization.

                              {time}  1215

  Mr. BROWN of Ohio. Mr. Speaker, I thank the gentlewoman from Guam, 
and I will work with the gentleman from Georgia (Mr. Deal) and the 
gentlewoman from Guam (Ms. Bordallo) and the congressional 
Representatives from other U.S. territories to secure the inclusion of 
U.S. territories in the conference report on the prior legislation 
reauthorizing the State high-risk pool grant funding; and I thank the 
gentlewoman from Guam and also the gentlewoman from the Virgin Islands 
(Mrs. Christensen) in joining us on the floor.
  Mr. Speaker, I reserve the balance of my time.
  Mr. DEAL of Georgia. Mr. Speaker, I am pleased to yield 2 minutes to 
the gentleman from Pennsylvania (Mr. Pitts), the author of the House 
companion bill to the legislation that we are considering now.
  Mr. PITTS. Mr. Speaker, as a sponsor of this legislation in the 
House, I rise in strong support of S. 1395. This bipartisan legislation 
would reform laws that govern the export of American-made 
pharmaceutical products, which our chairman, the gentleman from Georgia 
(Mr. Deal), has explained.
  This really is a jobs bill that will benefit small businesses, 
particularly small pharmaceutical companies employing between 100 and 
250 highly paid workers. Current law puts U.S. companies, particularly 
these small manufacturers, at significant disadvantage with their 
foreign competitors. Larger manufacturers, with an established foreign 
presence, may choose to manufacture offshore. Foreign firms do not have 
to worry about it. They readily export approved medical products 
between international drug control treaty countries without limit or 
restriction.
  To compete, smaller U.S. companies, or those requiring specialized 
manufacturing plants for niche pharmaceuticals, are forced to choose 
between spending millions of dollars on export costs or spending 
millions of dollars in establishing overseas manufacturing facilities. 
This cost hurts smaller companies like Cephalon, back home in 
Pennsylvania.
  The bottom line is our law ties the hands of American companies, 
forces them to do business elsewhere or not to do business at all. This 
legislation would authorize the Attorney General to permit carefully 
regulated pharmaceutical exports to international drug convention 
partner companies. The DEA would retain full authority over all 
shipments of controlled substances, and the bill establishes strict 
procedures to ensure these products are used solely for legitimate 
medical purposes.
  Mr. Speaker, this legislation keeps jobs and capital right here at 
home, and removes one of the barriers to prevent the success of these 
small companies. I urge support of the bill; and I thank my colleague, 
the gentleman from Ohio (Mr. Brown), for the bipartisan effort, and I 
thank Chairman Deal for his leadership on the issue.
  Mr. Speaker, as the sponsor of this legislation in the House I rise 
in strong support of S. 1395, the Controlled Substances Export Reform 
Act of 2005.
  This bipartisan legislation would reform laws that govern the export 
of American-made pharmaceutical products.
  This is a jobs bill that will benefit small businesses, particularly 
small pharmaceutical companies employing between 100 and 250 highly 
paid workers.
  Current law allows U.S. companies to export most controlled 
substances only to the immediate country where the products will be 
consumed.
  Shipment to central sites for further distribution across national 
boundaries is currently prohibited.
  Current law puts U.S. companies, particularly small manufacturers, at 
a significant disadvantage with their foreign competitors.
  Larger manufacturers with an established foreign presence may choose 
to manufacture off-shore using existing facilities.
  Foreign firms don't have to worry about it.
  They readily export approved medical products between international 
drug control treaty countries without limit or restriction.
  To compete, smaller U.S. companies and those requiring specialized 
manufacturing plants for niche pharmaceuticals are forced to choose 
between spending millions, of dollars on export costs or spending 
millions of dollars in establishing overseas manufacturing facilities.
  This cost harms smaller companies, like Cephalon, back home in 
Pennsylvania.
  The bottom line: Our law ties the hands of American companies and 
forces them to do business elsewhere--or to not do business at all.
  This legislation authorizes the Attorney General to permit carefully 
regulated pharmaceutical exports to international drug convention 
partner countries.
  The Drug Enforcement Administration (DEA) would retain its full 
authority over all shipments of controlled substances.
  It establishes strict procedures to ensure these products are used 
solely for legitimate medical purposes.
  Once enacted it would save small companies nearly 75 percent on 
export costs.
  It would enable them to compete in the long-term in the global 
market. And it would help them keep jobs and capital right here at 
home.
  An informal review of impacted U.S. exporters indicates that current 
law, with the cost of compliance, jeopardizes between 100-250 new U.S. 
jobs each time a covered product is introduced in foreign markets.
  Small businesses create new jobs; they strengthen communities; they 
drive innovation.
  The law should help them thrive, not put them at a disadvantage with 
foreign competitors or large corporations.
  We need to make sure that we treat them fairly and give them every 
opportunity to succeed.
  This bill removes just one of the barriers that prevent their 
success.
  I urge support for this bill.
  And continued support for our Nation's small businesses.
  Mr. BROWN of Ohio. Mr. Speaker, I yield back the balance of my time.
  Mr. DEAL of Georgia. Mr. Speaker, I yield such time as he may consume 
to the gentleman from Georgia (Mr. Norwood) for closing.
  Mr. NORWOOD. Mr. Speaker, I thank the gentleman for yielding me this 
time, and I think it is pretty obvious that all is said that needs to 
be said, so I will be very, very brief.
  I just simply want to rise in support of the Controlled Substances 
Export Reform Act of 2005. This is very commonsense legislation; and I 
thank my good friend, the gentleman from Pennsylvania (Mr. Pitts), for 
spearheading this in the House and would hope that all Members would 
vote for it.
  Mr. CANNON. Mr. Speaker, as America strives to adapt to a world of 
rapidly changing international trade, preserving and expanding U.S. 
manufacturing and production capabilities becomes ever more important. 
This is particularly true in Utah where current restrictions on exports 
of the medicines we produce have discouraged industry growth and 
threatened workers' jobs.
  The Controlled Substances Export Reform Act currently allows U.S. 
pharmaceutical companies to export most controlled substances only to 
the exact country where their product will be used. Shipment of U.S. 
medicines to central sites for further cross-border distribution, even 
when conducted under the watchful

[[Page H6673]]

eyes of the U.S. Drug Enforcement Administration and Department of 
Justice, is prohibited for U.S. exporters. This contrasts with the 
freedom of drug manufacturers throughout the rest of the world to 
readily move their products among and between international drug 
control treaty countries without limit or restriction.
  These limitations put U.S. manufacturers at a disadvantage by 
requiring more frequent and costly shipments to each individual country 
of use. We are effectively discouraging domestic manufacturing while 
encouraging U.S. drug exporters to move production overseas.
  Utah, with a small but growing pharmaceutical manufacturing industry, 
is committed to maintaining a strong domestic base so that U.S. 
businesses can compete on a level playing field with our international 
competitors. But this industry faces an uncertain future unless we do 
something.
  S. 1395, the Controlled Substances Export Reform Act of 2005, is the 
companion legislation to H.R. 184 that Rep. Joe Pitts and I introduced 
in the House, and that passed the House Judiciary and Energy and 
Commerce Committees. This legislation advances that goal by permitting 
the carefully regulated international transshipment of exported U.S. 
pharmaceuticals. The bill retains full DEA control over all drug 
exports and establishes strict permitting requirements to ensure drug 
safety while removing an unnecessary barrier to U.S. production and the 
growth of well-paid jobs.
  Mr. Speaker, on behalf of the 500 Utah workers whose jobs may be 
endangered by current law, and on behalf of the many more workers we 
stand to gain by updating an outdated statute, I am pleased to support 
S. 1395 and I urge the measure's immediate adoption.
  Mr. DEAL of Georgia. Mr. Speaker, I yield back the balance of my 
time.
  The SPEAKER pro tempore (Mr. Culberson). The question is on the 
motion offered by the gentleman from Georgia (Mr. Deal) that the House 
suspend the rules and pass the Senate bill, S. 1395.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the Senate bill was passed.
  A motion to reconsider was laid on the table.

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