[Congressional Record Volume 158, Number 97 (Tuesday, June 26, 2012)]
[House]
[Pages H3991-H3994]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STRENGTHENING AND FOCUSING ENFORCEMENT TO DETER ORGANIZED STEALING AND
ENHANCE SAFETY ACT OF 2012
Mr. SMITH of Texas. Madam Speaker, I move to suspend the rules and
pass the bill (H.R. 4223) to amend title 18, United States Code, to
prohibit theft of medical products, and for other purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 4223
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 ``Strengthening and Focusing
Enforcement to Deter Organized Stealing and Enhance Safety
Act of 2012'' or the ``SAFE DOSES Act''.
SEC. 2. THEFT OF MEDICAL PRODUCTS.
(a) Prohibited Conduct and Penalties.--Chapter 31 of title
18, United States Code, is amended by adding at the end the
following:
``Sec. 670. Theft of medical products
``(a) Prohibited Conduct.--Whoever, in, or using any means
or facility of, interstate or foreign commerce--
``(1) embezzles, steals, or by fraud or deception obtains,
or knowingly and unlawfully takes, carries away, or conceals
a pre-retail medical product;
``(2) knowingly and falsely makes, alters, forges, or
counterfeits the labeling or documentation (including
documentation relating to origination or shipping) of a pre-
retail medical product;
``(3) knowingly possesses, transports, or traffics in a
pre-retail medical product that was involved in a violation
of paragraph (1) or (2);
``(4) with intent to defraud, buys, or otherwise obtains, a
pre-retail medical product that has expired or been stolen;
``(5) with intent to defraud, sells, or distributes, a pre-
retail medical product that is expired or stolen; or
``(6) attempts or conspires to violate any of paragraphs
(1) through (5);
shall be punished as provided in subsection (c) and subject
to the other sanctions provided in this section.
``(b) Aggravated Offenses.--An offense under this section
is an aggravated offense if--
``(1) the defendant is employed by, or is an agent of, an
organization in the supply chain for the pre-retail medical
product; or
``(2) the violation--
``(A) involves the use of violence, force, or a threat of
violence or force;
``(B) involves the use of a deadly weapon;
``(C) results in serious bodily injury or death, including
serious bodily injury or death resulting from the use of the
medical product involved; or
``(D) is subsequent to a prior conviction for an offense
under this section.
``(c) Criminal Penalties.--Whoever violates subsection
(a)--
``(1) if the offense is an aggravated offense under
subsection (b)(2)(C), shall be fined under this title or
imprisoned not more than 30 years, or both;
``(2) if the value of the medical products involved in the
offense is $5,000 or greater, shall be fined under this
title, imprisoned for not more than 15 years, or both, but if
the offense is an aggravated offense other than one under
subsection (b)(2)(C), the maximum term of imprisonment is 20
years; and
``(3) in any other case, shall be fined under this title,
imprisoned for not more than 3 years, or both, but if the
offense is an aggravated offense other than one under
subsection (b)(2)(C), the maximum term of imprisonment is 5
years.
``(d) Civil Penalties.--Whoever violates subsection (a) is
subject to a civil penalty in an amount not more than the
greater of--
``(1) three times the economic loss attributable to the
violation; or
``(2) $1,000,000.
``(e) Definitions.--In this section--
``(1) the term `pre-retail medical product' means a medical
product that has not yet been made available for retail
purchase by a consumer;
``(2) the term `medical product' means a drug, biological
product, device, medical food, or infant formula;
``(3) the terms `device', `drug', `infant formula', and
`labeling' have, respectively, the meanings given those terms
in section 201 of the Federal Food, Drug, and Cosmetic Act;
``(4) the term `biological product' has the meaning given
the term in section 351 of the Public Health Service Act;
``(5) the term `medical food' has the meaning given the
term in section 5(b) of the Orphan Drug Act; and
``(6) the term `supply chain' includes manufacturer,
wholesaler, repacker, own-labeled distributor, private-label
distributor, jobber, broker, drug trader, transportation
company, hospital, pharmacy, or security company.''.
(b) Clerical Amendment.--The table of sections at the
beginning of chapter 31 of title 18, United States Code, is
amended by adding after the item relating to section 669 the
following:
``670. Theft of medical products.''.
SEC. 3. CIVIL FORFEITURE.
Section 981(a)(1)(C) of title 18, United States Code, is
amended by inserting ``670,'' after ``657,''.
SEC. 4. PENALTIES FOR THEFT-RELATED OFFENSES.
(a) Interstate or Foreign Shipments by Carrier.--Section
659 of title 18, United States Code, is amended by adding at
the end of the fifth undesignated paragraph the following:
``If the offense involves a pre-retail medical product (as
defined in section 670), it shall be punished under section
670 unless the penalties provided for under this section are
greater.''.
(b) Racketeering.--
(1) Travel act violations.--Section 1952 of title 18,
United States Code, is amended by adding at the end the
following:
``(d) If the offense under this section involves an act
described in paragraph (1) or (3) of subsection (a) and also
involves a pre-retail medical product (as defined in section
670), the punishment for the offense shall be the same as the
punishment for an offense under section 670 unless the
punishment under subsection (a) is greater.''.
(2) Money laundering.--Section 1957(b)(1) of title 18,
United States Code, is amended by adding at the end the
following: ``If the offense involves a pre-retail medical
product (as defined in section 670) the punishment for the
offense shall be the same as the punishment for an offense
under section 670 unless the punishment under this subsection
is greater.''
(c) Breaking or Entering Carrier Facilities.--Section 2117
of title 18, United States Code, is amended by adding at the
end of the first undesignated paragraph the following: ``If
the offense involves a pre-retail medical product (as defined
in section 670) the punishment for the offense shall be the
same as the punishment for an offense under section 670
unless the punishment under this section is greater.''.
(d) Stolen Property.--
(1) Transportation of stolen goods and related offenses.--
Section 2314 of title 18, United States Code, is amended by
adding at the end of the sixth undesignated paragraph the
following: ``If the offense involves a pre-retail medical
product (as defined in section 670) the punishment for the
offense shall be the same as the punishment for an offense
under section 670 unless the punishment under this section is
greater.''.
(2) Sale or receipt of stolen goods and related offenses.--
Section 2315 of title 18, United States Code, is amended by
adding at the end of the fourth undesignated paragraph the
following: ``If the offense involves a pre-retail medical
product (as defined in section 670) the punishment for the
offense shall be the same as the punishment for an offense
under section 670 unless the punishment under this section is
greater.''.
(e) Priority Given to Certain Investigations and
Prosecutions.--The Attorney General shall give increased
priority to efforts to investigate and prosecute offenses
under section
[[Page H3992]]
670 of title 18, United States Code, that involve pre-retail
medical products.
SEC. 5. AMENDMENT TO EXTEND WIRETAPPING AUTHORITY TO NEW
OFFENSE.
Section 2516(1) of title 18, United States Code, is
amended--
(1) by redesignating paragraph (s) as paragraph (t);
(2) by striking ``or'' at the end of paragraph (r); and
(3) by inserting after paragraph (r) the following:
``(s) any violation of section 670 (relating to theft of
medical products); or''.
SEC. 6. REQUIRED RESTITUTION.
Section 3663A(c)(1)(A) of title 18, United States Code, is
amended--
(1) in clause (ii), by striking ``or'' at the end;
(2) in clause (iii), by striking ``and'' at the end and
inserting ``or''; and
(3) by adding at the end the following:
``(iv) an offense under section 670 (relating to theft of
medical products); and''.
SEC. 7. DIRECTIVE TO UNITED STATES SENTENCING COMMISSION.
(a) In General.--Pursuant to its authority under section
994 of title 28, United States Code, and in accordance with
this section, the United States Sentencing Commission shall
review and, if appropriate, amend the Federal sentencing
guidelines and policy statements applicable to persons
convicted of offenses under section 670 of title 18, United
States Code, as added by this Act, section 2118 of title 18,
United States Code, or any another section of title 18,
United States Code, amended by this Act, to reflect the
intent of Congress that penalties for such offenses be
sufficient to deter and punish such offenses, and
appropriately account for the actual harm to the public from
these offenses.
(b) Requirements.--In carrying out this section, the United
States Sentencing Commission shall--
(1) consider the extent to which the Federal sentencing
guidelines and policy statements appropriately reflect--
(A) the serious nature of such offenses;
(B) the incidence of such offenses; and
(C) the need for an effective deterrent and appropriate
punishment to prevent such offenses;
(2) consider establishing a minimum offense level under the
Federal sentencing guidelines and policy statements for
offenses covered by this Act;
(3) account for any additional aggravating or mitigating
circumstances that might justify exceptions to the generally
applicable sentencing ranges;
(4) ensure reasonable consistency with other relevant
directives, Federal sentencing guidelines and policy
statements;
(5) make any necessary conforming changes to the Federal
sentencing guidelines and policy statements; and
(6) ensure that the Federal sentencing guidelines and
policy statements adequately meet the purposes of sentencing
set forth in section 3553(a)(2) of title 18, United States
Code.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Texas (Mr. Smith) and the gentleman from Georgia (Mr. Johnson) each
will control 20 minutes.
The Chair recognizes the gentleman from Texas.
General Leave
Mr. SMITH of Texas. Madam Speaker, I ask unanimous consent that all
Members may have 5 legislative days within which to revise and extend
their remarks and include extraneous materials on H.R. 4223, as
amended, currently under consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
Mr. SMITH of Texas. Madam Speaker, I yield myself such time as I may
consume.
Large-scale medical product theft is a significant problem in today's
society. Medical products require special care and maintenance. When
medical products are stolen, thieves resell them. When these drugs are
not stored or handled properly, they can lose their effectiveness and
cause further injury to medical patients.
Current law does not recognize the added importance of medical
products. These products are often essential to a person's health and
can be lifesaving.
Under federal law, those who steal a truck full of insulin intended
for diabetics would be sentenced to the same extent as those who steal
a truck full of car tires.
In 2009, an organized ring of criminals stole 129,000 vials of
insulin worth approximately $11 million in North Carolina. A few months
later, the FDA received a report that some of the vials had been
reintroduced into the supply chain when a diabetic patient reported to
a medical center in Houston, Texas, with an adverse reaction after use
of insulin from the stolen lot.
The FDA issued a warning that the insulin had likely not been kept
refrigerated correctly and could still be in the market. The spoiled
product was ultimately found in pharmacies in 17 states. At least 2
additional patients experienced adverse reactions. While some arrests
have been made, over 125,000 vials of insulin still remain unaccounted
for.
Shipments of drugs that treat kidney failure, ADHD, schizophrenia,
rheumatoid arthritis and ovarian cancer were stolen in three separate
incidents between 2008 and 2009.
The prescription drugs, worth over $3 million, were taken during a
distribution center break-in and in two separate trailer break-ins. The
FBI made an arrest in only one of the three incidents, and the criminal
was convicted.
H.R. 4223, the SAFE DOSES Act, modernizes and strengthens the
criminal code in order to deter and punish those who steal pre-retail
medical products. Enhanced penalties not only make people think twice
before they steal medical shipments, but also provide law enforcement
agencies with the tools they need to obtain cooperation to bring down
criminal organizations.
The SAFE DOSES Act enables authorities to better target the multi-
dimensional criminal enterprises that carry out these thefts and
recognizes the health risks created by the improper care and handling
of sensitive medical products.
This bipartisan bill helps to ensure that life-saving drugs remain in
the hands of those trained to handle them, and do not continue to pose
a threat to public safety. I commend Crime Subcommittee Chairman
Sensenbrenner for his work on this legislation and urge my colleagues
to join me in support of this bill.
Mr. SMITH of Texas. Madam Speaker, I yield such time as he may
consume to the gentleman from Wisconsin (Mr. Sensenbrenner), who is the
chairman of the Crime Subcommittee of the Judiciary Committee and a
former chairman of the Judiciary Committee, and also the sponsor of
this legislation.
Mr. SENSENBRENNER. I thank the gentleman from Texas for yielding me
this time.
I introduced H.R. 4223, the SAFE DOSES Act, to address the problem of
medical cargo theft across the United States. Medical cargo theft poses
significant health risks to patients who have no reason to know that
their medicines have been stolen and improperly cared for before being
sold back into the legitimate supply chain.
Stolen medical cargo can kill or injure those patients that need
reliable, safe medicines.
{time} 1510
Sophisticated and enterprising criminal organizations are stealing
large quantities of medical products and selling them via the wholesale
market into legitimate pharmacies and hospitals. They are putting
patient safety at risk because improperly cared-for medical products
can be ineffective or harmful, and such damaged products are often
impossible for health care professionals to identify.
High-value pharmaceuticals, including treatments for serious
diseases, are frequent targets. Unfortunately, these high-value items
are the very type of sensitive products that need the most careful
handling and temperature control. Many medical products can become
ineffective if stored at the wrong temperature, even for a brief time.
Yet, under current law, the theft of lifesaving medical supplies is
treated the same as the theft of perfume or stereo equipment.
The criminal organizations hijack tractor-trailers at truck stops,
break into warehouses and evade alarm systems, forge shipping
documents, produce high-quality counterfeit labels with altered
expiration dates and lot numbers, and otherwise thwart the intense
security measures used by the industry. Some employ sophisticated
surveillance equipment and techniques in order to learn exactly when
and where they can steal the particular shipments they want.
For example, in March 2010, over $75 million of prescription drugs,
including treatments for cancer, heart disease, and neurological
disorders such as depression, ADHD, and schizophrenia, were stolen from
a warehouse in Enfield, Connecticut. The burglary was one of the
largest pharmaceutical heists in history. The criminals broke into the
secure facility on the weekend by cutting a hole in the roof, then
rappelling into the storage area. They disabled the alarm system and
loaded dozens of crates onto a tractor-trailer.
Experts have said that this heist shared many traits with warehouse
thefts of pharmaceuticals last year in Richmond, Virginia; Memphis,
Tennessee; and Olive Branch, Mississippi. Those thieves also cut
through ceilings and sometimes used trapeze-style rigging to get inside
and to disable the main and backup alarms. In some cases, they sprayed
dark paint on the
[[Page H3993]]
lenses of security cameras; in others, they removed disks from the
security recording devices.
This bill increases sentences for theft, transportation, and storage
of medical product cargo; enhances penalties for the ``fences'' who
knowingly obtain stolen medical products for resale into the supply
chain; increases sentences when injury or death results from the
ingestion of a stolen substance or when the defendant is employed by an
organization in the supply chain; provides law enforcement with such
tools as wiretaps; and provides restitution to victims injured by
stolen medical products.
The legislation is supported by the Coalition for Patient Safety and
Medicine Integrity, a group of pharmaceutical, medical device, and
medical products companies whose purpose is to protect patients from
the risks posed by stolen and improperly handled medical products
reentering the legitimate supply chain. Members of the Coalition
include Abbott and Eli Lilly, GlaxoSmithKline, Johnson & Johnson,
Novartis, Novo Nordisk, Sanofi, and PhRMA. The bill is also supported
by the Association of Community Cancer Centers, the Healthcare
Distribution Management Association, the National Council for Community
Behavioral Healthcare, and the National Fraternal Order of Police.
The companion bill in the other body, Senate 1002, was reported by
voice vote from the Senate Judiciary Committee in March.
I urge my colleagues to support this commonsense, bipartisan
legislation to give law enforcement agencies and prosecutors the
additional tools they need to confront this growing problem.
Mr. JOHNSON of Georgia. Madam Speaker, I yield myself such time as I
may consume.
H.R. 4223 is intended to address the problem of large-scale medical
product theft. I think we will all agree that this crime poses
substantial risks to the public.
For instance, in North Carolina, in 2009, over 120,000 vials of
insulin were stolen and subsequently reintroduced back into the supply
chain to be used by unsuspecting patients.
Patients should be able to rely on their medications to be safe,
effective, and unadulterated, and we certainly need to treat it as a
significant crime when criminals steal shipments of drugs. Large-scale
medical product theft is a serious problem that merits a serious
solution.
I commend my colleagues on the House Judiciary Committee for making
important changes to this bill. The manager's amendment adopted at
markup clarified that the mens rea applies only to conduct in which the
perpetrator knows that the product involved is a medical product that
is stolen, expired, or not yet released to the public.
I also believe that the correct reading of this bill, consistent with
the general presumption that the mens rea element in a statute applies
to all other nonjurisdictional elements, is that a defendant would have
to know that the product is a pre-retail medical product in order to be
convicted.
While I note these important issues, I want to raise a note of
concern about the approach of increasing penalties as a way of
addressing crime. Stealing cargo from a warehouse is already illegal,
of course. The penalty is a fine and up to 10 years in prison.
H.R. 4223 creates a new crime for theft of preretail medical products
and a new code section, 18 U.S.C. Section 670. Section 670 would
increase the penalties to up to 30 years in prison in some cases if the
stolen goods are preretail medical products.
However, I'm heartened that this bill does not include mandatory
minimum sentences, and there will be an intelligent, deliberative
process to set sentencing guidelines by the U.S. Sentencing Commission.
As the House moves to adopt this bill today, I want to emphasize that
it is also important that we do what we know works best to deter crime,
and that is to increase the likelihood that perpetrators will be caught
and convicted.
We heard from a witness at the hearing on this bill that increased
investigation and enforcement would have a greater deterrent effect
than increased penalties. I agree, and this bill was amended at markup
to include a provision directing the Attorney General to give increased
priority to efforts to investigate and prosecute preretail medical
theft offenses.
Finally, we want to encourage the industry to exhaust all reasonable
means of preventing these thefts from their properties and other
facilities along the transit route.
The April 2011 edition of Fortune Magazine included an article
entitled, ``Drug Theft Goes Big.'' The article reports that the thieves
who committed the largest prescription drug theft in history did so by
cutting through the tar roof of Eli Lilly's Connecticut warehouse and
sliding down ropes. Security was so lax that the thieves were able to
pull their own tractor-trailer up to the loading dock and spend a
couple of hours loading the stolen goods.
In a similar event several months ago, thieves broke into a
GlaxoSmithKline warehouse by coming through the roof. While none of
this in any way shields or excuses the perpetrators of these crimes,
clearly, these examples point to the need for more security.
Government and industry should work together at all points along the
factory-to-retail chain to prevent and detect such thefts. I'm aware
that industry and government regulatory authorities are working toward
these ends, and I would hope that work will continue so that we will
have a comprehensive effort to address this type of crime.
Madam Speaker, I yield back the balance of my time.
{time} 1520
Mr. SMITH of Texas. Madam Speaker, I yield back the balance of my
time.
Ms. JACKSON LEE of Texas. Madam Speaker, I rise today in support of
H.R. 4223, the ``Safe Doses Act of 2012'' which amends Title 18, United
States Code, to prohibit theft of medical products, and for other
purposes.
More specifically, this bill will prohibit theft of pre-retail
products such as drugs, medical devices and infant formula. Likewise,
it forbids one from alternating labels of pre-retail medical products,
transporting stolen or counterfeit medical products and purchasing or
distributing expired medical products with the intent to deceive others
and passing such products off as authentic.
Due to the increased activity in counterfeit drugs it is critical
that Congress lay down harsher parameters so that potential criminals
are faced with more deterrents should they consider participating in
such behavior.
As a Representative from Houston, Texas, it is of grave concern that
consumers and law enforcement officials are protected given the
proximity of Texas to the Mexican border. It is not inconceivable that
crime syndicates operating on both sides could cause significant
problems by stealing drugs and selling them in Mexico.
The theft of large scale medical products has become a growing
concern; thus, this legislation aims to toughen the penalties for
individuals who place thousands of lives in danger by stealing large
quantities of medical products and re-introducing such products in the
legitimate supply chain including pharmacies and hospitals.
This bill is encouraged by pharmaceutical companies after instances
of fraud appeared within the industry. According to an FDA affidavit,
in 2009, a truck containing over 120,000 vials of insulin was stolen in
North Carolina. After being improperly stored the product was illegally
resold into distribution by wholesalers reaching medical centers in
many other states including my state of Texas.
While some diabetic patients reported the drugs after usage and
noticing poor blood sugar control, the actual amount of innocent people
who received the spoiled product in pharmacies in 17 states is unknown.
It was determined that the insulin was purchased from a national
distribution company only one day after the medication was reported
stolen. While some arrests were made in relation to this incident, over
125,000 vials of insulin were never located.
Incidents such as these are ones which this bill is intended to
prevent. Serious public health and safety implications arise based on
the improper care of medical products which may be both ineffective and
harmful to unsuspecting patients.
Currently, Title 18 of the United States Code sets forth penalties of
a fine and/or imprisonment of no more than 10 years for involvement in
such crimes. While I am not quick to increase sentences, keeping one
imprisoned after they have served their time, I am of the belief that
consumers purchasing medicine should be able to do so with the
confidence that what they are paying for is real and safe. Thus those
criminals that take actions to threaten the life of another by engaging
in the
[[Page H3994]]
transportation of counterfeit drugs should be locked up.
Despite the lack of evidence supporting the contention that offenders
are less likely to engage in such deviant behavior once they are aware
of federal laws increasing fines and longer penalties, I support this
bipartisan measure to help ensure that our everyday Americans in need
of medication are not falling prey to criminals intending to defraud
them of necessary medical products.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Texas (Mr. Smith) that the House suspend the rules and
pass the bill, H.R. 4223, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
____________________