[Senate Report 105-43]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 105
105th Congress                                                   Report
                                 SENATE

 1st Session                                                     105-43
_______________________________________________________________________


 
  FOOD AND DRUG ADMINISTRATION MODERNIZATION AND ACCOUNTABILITY ACT OF 
                                 1997

                                _______
                                

                  July 1, 1997.--Ordered to be printed

   Filed, under authority of the order of the Senate of June 27, 1997

_______________________________________________________________________


    Mr. Jeffords, from the Committee on Labor and Human Resources, 
                        submitted the following

                              R E P O R T

                             together with

                     ADDITIONAL AND MINORITY VIEWS

                         [To accompany S. 830]

    The Committee on Labor and Human Resources, to which was 
referred the bill (S. 830) to amend the Federal Food, Drug, and 
Cosmetic Act and the Public Health Service Act to improve the 
regulation of food, drugs, and biological products, and for 
other purposes, having considered the same, reports favorably 
thereon with an amendment in the nature of a substitute and 
recommends that the bill (as amended) do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and summary..............................................2
 II. Background and need for the legislation..........................6
III. Legislative history and votes in committee......................11
 IV. Explanation of the legislation and committee views..............15
  V. Cost estimate...................................................69
 VI. Regulatory impact statement.....................................74
VII. Section-by-section analysis.....................................75
VIII.Additional views...............................................101

 IX. Minority views.................................................107
  X. Changes in existing law........................................113

                         I. Purpose and Summary

    Under the Federal Food, Drug, and Cosmetic Act (FFDCA), the 
Food and Drug Administration (FDA) has two important functions: 
(1) the review and approval of important new products that can 
improve the public health, such as lifesaving drugs, biological 
products, and medical devices; and (2) the prevention of harm 
to the public from marketed products that are unsafe or 
ineffective. Since 1938, the Federal Food, Drug, and Cosmetic 
Act has been amended numerous times to strengthen the FDA's 
function of ensuring that unsafe or ineffective products are 
not marketed but has been changed only once, by the 
Prescription Drug User Fee Act of 1992 (PDUFA), to strengthen 
the FDA's function of reviewing and approving important new 
products that can improve the public health.
    The Food and Drug Administration Modernization and 
Accountability Act of 1997, S. 830, is designed to ensure the 
timely availability of safe and effective new products that 
will benefit the public and to ensure that our Nation continues 
to lead the world in new product innovation and development. 
The legislation accomplishes three major objectives: it builds 
upon recent administrative reforms that both streamline FDA's 
procedures and strengthen the agency's ability to accomplish 
its mandate in an era of limited Federal resources; it requires 
a greater degree of accountability from the agency in how it 
pursues its mandate; and it provides for the reauthorization of 
PDUFA.
    The FDA acknowledges that its mandate requires it to 
regulate over one-third of our Nation's products. Within its 
purview the FDA regulates nearly all of the food and all of the 
cosmetics, medical devices and drugs made available to our 
citizens. This legislation identifies areas where improvements 
can be made that will strengthen the agency's ability to 
approve safe and effective products more expeditiously. It 
builds upon the numerous investigations by Congress, the FDA, 
the General Accounting Office (GAO), and other organizations 
that have identified problems with the current FDA product 
approval system and have recommended reasonable reforms to 
streamline and strengthen that system. It includes the 
following major provisions:

1. the legislation establishes a clearly defined, balanced mission for 
                                the fda

    Congress has never established a mission statement for the 
FDA. The FDA in March of 1993 adopted a formal statement 
declaring that the agency ``is a team of dedicated 
professionals working to protect and promote the health of the 
American people.'' Although this statement defines the agency's 
mission in terms of ensuring that the products it regulates 
comply with the law, there is no reference to the importance of 
approving new products that benefit the public. The legislation 
amends the Food Drug and Cosmetic Act by adding an agency 
mission statement focused on: (1) protecting the public health 
by ensuring that the products it regulates meet the appropriate 
FDA regulatory standards, (2) promptly and efficiently 
reviewing clinical research and taking appropriate action on 
the marketing of regulated products in a manner which does not 
unduly impede innovation or product availability, and, (3) 
participating with other countries to reduce regulatory 
burdens, harmonize regulatory requirements, and achieve 
appropriate reciprocal arrangements with other countries.

  2. the legislation improves patient access to needed therapies and 
       provides expedited humanitarian access to medical devices

    The FDA has no crosscutting program that ensures access by 
patients with serious or life-threatening diseases to drugs or 
devices in clinical trials--even when that unapproved therapy 
may be the only way to save the patient's life. The legislation 
would create new law whereby manufacturers may provide, under 
strictly controlled circumstances and in response to a patients 
request, an investigational product for those patients needing 
treatment for a serious or life-threatening disease. The 
legislation also improves the existing program for the 
humanitarian use of medical devices for patient populations of 
fewer than 4,000.

   3. the legislation creates new incentives for determining better 
                      pharmaceuticals for children

    Children have for years been wrongly considered ``small 
adults'' when estimating the effect of prescription drugs on 
their overall health. Currently there is no systematic means 
for testing the safety and efficacy of drugs on the pediatric 
population. The legislation gives the Secretary authority to 
request pediatric clinical trials for new drug applications and 
provides 6 extra months of market exclusivity to drugs when the 
manufacturer voluntarily meet certain conditions under the 
program. The Secretary must determine in writing that 
information relating to the use of a drug in the pediatric 
population is needed. In addition, the FDA may establish time 
frames for completing such pediatric studies before additional 
exclusivity is granted.

4. the legislation gives patients access to new therapies more quickly 
           through a new ``fast-track'' drug approval process

    For several years the FDA has allowed the expedited review 
and approval of drugs but such review has been largely confined 
to treatments for HIV/AIDS or cancer. This provision 
facilitates development and expedites approval of new drugs for 
the treatment of any serious or life-threatening diseases.

     5. the legislation increases access to information by health 
                       professionals and patients

    For years, sophisticated users of health related economic 
information, like health maintenance organizations, have been 
constrained from access to important information that could 
help them reduce health-care costs. The legislation would apply 
the Federal Trade Commission's ``competent and reliable 
scientific evidence'' standard for FDA review of health care 
economic statements distributed by manufacturers to 
sophisticated purchasers. In the past, only a few patient 
groups have had access to information about ongoing clinical 
trials for lifesaving therapies. The legislation expands 
patient access to information by requiring the creation of 
databases on ongoing research related to the treatment, 
detection, and prevention of serious or life-threatening 
diseases.

 6. the legislation increases agency access to expertise and resources

    Current law contains no provisions to assure that the FDA 
can access expertise housed at the National Institutes of 
Health (NIH) and other science-based Federal agencies to 
enhance the scientific and technical expertise available to 
FDA's product reviewers. The legislation requires FDA to 
develop programs and policies to foster such collaboration. The 
legislation also authorizes the agency to contract with outside 
experts to review all or parts of applications when it will add 
to the timeliness or quality of a product review, and provides 
for the use of accredited outside organizations for the review 
of medical devices.

     7. the legislation improves the certainty and clarity of rules

    The legislation makes a series of changes related to the 
classification, review and approval of FDA regulated products 
designed to ensure that sponsors of new products face 
consistent and equitable regulatory requirements. In addition, 
the legislation gives FDA 2 years to evaluate the success of 
its recently issued ``Good Guidance Practices'' guidance after 
which FDA is required to implement this policy as a regulation, 
making any modifications necessary to reflect experience during 
the 2-year trial period.
    The legislation provides medical device manufacturers with 
the ability to make recommendations to the FDA respecting 
initial product classifications. It facilitates the 
reclassification and/or approval of device applications by 
allowing FDA to consider historical data in making its 
determinations, and the legislation more clearly states the 
relationship of labeling claims to approval and clearance of 
medical devices. It increases the certainty of review time 
frames by providing a definition of a day with respect to the 
agency's ``review time clock'' and by requiring the agency to 
approve or disapprove a device application within 180 days.
    The legislation also prohibits FDA from withholding the 
initial classification of a device because of a failure to 
comply with any provision of the unrelated to making a 
determination of substantial equivalence, and it clarifies that 
FDA has discretion in determining the number of clinical trials 
required for the approval of a drug or device. FDA would retain 
total discretion to require a sufficient number of trials to 
show safety and efficacy. The provision introduces the concept 
that two trials are not always necessary, establishes the 
primacy of quality data over quantity of data, and requires the 
FDA to consider the number and type of trials on a product-by-
product basis.

  8. the legislation improves agency accountability and provides for 
            better resource allocation by setting priorities

    Except as required under PDUFA, the FFDCA provides no form 
of public accountability by the FDA for its performance of its 
statutory obligations. The legislation requires FDA to develop 
a plan designed to: (1) minimize deaths and injuries suffered 
by persons who may use products regulated by the FDA; (2) 
maximize the clarity and availability of information about the 
product review process; (3) implement all inspection and post-
market monitoring provisions of the Act by 1999; (4) ensure 
access to the scientific and technical expertise necessary to 
properly review products; (5) establish a schedule to bring the 
FDA into compliance by 1999 with the product review times in 
the Act for products submitted after the date of enactment of 
this section; and (6) eliminate the backlog of products 
awaiting final action by the year 2000. The legislation also 
requires FDA to submit an annual report to assist Congress in 
assessing the agency's performance in accomplishing the 
objectives laid out in the agency plan.
    The legislation streamlines several FDA functions with 
respect to certain review and inspection processes thus 
allowing the agency to focus its limited resources on areas of 
greatest need. The legislation provides FDA with the discretion 
to approve drugs and biologics on the basis of products 
manufactured in pilot and small-scale facilities. FDA is also 
directed to establish policies to facilitate the approval of 
supplemental applications for new uses for an approved product. 
Further, the legislation establishes procedures and policies to 
foster a collaborative review process between the agency and 
the sponsors of medical device applications. Finally, the 
legislation streamlines the review of minor modifications to 
medical devices.

 9. the legislation simplifies the approval process for indirect food 
  contact substances and provides a more reasonable standard for some 
                             health claims

    Current law requires the agency to preapprove food contact 
substances, most of which pose little if any risk to human 
health. The legislation replaces the preapproval process for 
these substances (primarily packaging materials) with a simple 
notification requirement. The legislation also provides for 
health claims for foods, with premarket notification, when the 
claims are based on authoritative recommendations by an 
authoritative scientific body of the U.S. Government such as 
the National Institutes of Health, the Centers for Disease 
Control and Prevention, or the National Academy of Sciences.

   10. the legislation reauthorizes the pdufa program thus ensuring 
            additional resource availability for the agency

    PDUFA is reauthorized for 5 years. Performance goals beyond 
those set for the 1992 Act will be identified in side letters 
between the FDA and the Senate Committee on Labor and Human 
Resources. The bill assumes that FDA will receive for fiscal 
year 1998 the 1997 level of appropriated funds for the agency. 
For fiscal years 1999 through 2002, the bill assumes an annual 
inflation adjustment.

              II. Background and Need for the Legislation

                             a. background

    Over the years, Congress has dramatically expanded the 
reach and responsibilities of the FDA. The Federal Food and 
Drugs Act of 1906, the first national statute enacted by 
Congress to regulate the American food and drug supply, gave 
the Agency the authority to police the market and remove 
adulterated or misbranded foods and drugs.
    In 1938, Congress passed the Federal Food, Drug, and 
Cosmetic Act, which expanded the agency's reach to the 
regulation of cosmetics and medical devices and, for the first 
time, provided the agency with the authority to review and 
assure the safety of a product--new drugs--prior to the 
marketing of that product. The 1938 statute required sponsors 
of new drugs to file a new drug application notifying the FDA 
prior to marketing a new human or animal drug. The new drug 
application became effective after 60 days (which could be 
extended to 180 days), unless the Agency found that it had 
insufficient information to determine whether the drug was safe 
for its intended use.
    In the ensuing years, Congress enacted a series of statutes 
further expanding the FDA's regulatory reach. These included 
the 1944 Pitts Act, which gave the FDA the authority to 
regulate biological products, and the Miller Pesticide 
Amendments of 1954, which required FDA premarket approval for 
pesticides in or on raw or processed foods. The Food Additive 
Amendment of 1958 required premarket approval of food 
additives, and the Color Additive Amendments of 1960 required 
premarket approval of color additives in food, drugs, and 
cosmetics. The Drug Amendments of 1968 consolidated the 
premarket approval requirements for new animal drugs and feed 
additives. The Medical Device Amendments of 1976 created a 
device ranging from the most simple to the most complex and 
premarket approval for new medical devices, and the Safe 
Medical Devices Act of 1990 codified FDA's premarket 
notification program and increased the agency's postmarket 
enforcement capabilities.
    From 1906 to the present, then, the FDA's role has expanded 
from one of removing adulterated or misbranded products from 
the market to one of preapproving the testing and marketing of 
products.

                      b. need for the legislation

    Over the years, and particularly with the enactment of 
requirements that the FDA determine that drugs and devices are 
effective as well as safe, the FDA's requirements for clinical 
testing and its premarket reviews of new products have grown 
increasingly complex, time-consuming, and costly. From the 
1960's to the 1990's, for example, the time required to 
complete clinical trials for new drugs has grown from 2.5 to 
nearly 6 years. Applications for the approval of new drugs 
typically run to hundreds of thousands of pages in length. 
According to a recently published study, from the beginning of 
the process to the end, it takes an average of 15 years and 
costs in the range of $500 million dollars to bring a new drug 
to market. [DiMasi, Trends in Drug Development, Costs, Times, 
and Risks, 29 Drug Information Journal 375, 382, April-June 
1995.]
    By law, the FDA is required to review and act on 
applications for the approval of new drugs and devices within 
180 days. According to the FDA's own budget justification for 
fiscal year 1998, it takes the agency an average of 12 months 
longer than the statute allows for the agency to review new 
drugs and three and one-half months longer than the statute 
allows for premarket approval (PMA) devices. And the agency in 
its budget submission to Congress for FY 1998 projects that the 
backlog for devices is projected to increase by 17 percent from 
this year to next.
    These increases in the time, complexity, and cost of 
bringing new products to market are borne directly by the 
public, in delayed access to important new products--including 
life-saving medical therapies--and in higher costs. They are a 
growing disincentive to continued investment in the development 
of innovative new products and a growing incentive for American 
companies to move research, development, and production abroad, 
threatening our Nation's continued world leadership in new 
product development, costing American jobs, and further 
delaying the public's access to important new products.
    Over the past 20 years, a bipartisan consensus has emerged 
on the need for reforms of the FDA premarket approval process 
to strike a better balance between the need to ensure that 
products are safe and effective, on the one hand, and to 
facilitate the timely availability of new products, on the 
other.
    During 1978 and 1979, Congress considered a wholesale 
revision of the new drug approval process. This committee led 
that effort, reporting legislation introduced by Senator 
Kennedy, the Drug Regulation Reform Act of 1979. That 
legislation was subsequently approved by the Senate but was not 
considered by the House of Representatives. A number of the 
provisions in that legislation are reflected in S. 830, 
including provisions to permit new drug sponsors to obtain 
advice from the agency regarding their investigational plans; 
to require the FDA to issue written guidelines regarding 
protocols and methods for conducting drug investigations; and 
to require the FDA to take measures to ensure that reviews are 
conducted efficiently and expeditiously.
    Many of these same changes were recommended by the 
Commission on the Federal Drug Approval Process, convened at 
the request of then-Representative Albert Gore, Jr., chairman 
of the House Subcommittee on Investigations and Oversight and 
then-Representative James Scheuer, chairman of the House 
Subcommittee on Natural Resources, Agricultural Research and 
Environment. The Commission's 1982 report recommended such 
changes as simplification of the investigational new drug 
requirements; recognition that drug effectiveness could be 
demonstrated by one study in appropriate cases; greater 
utilization of outside expert advice; improving interactions 
with industry; tracking the review process to ensure 
timeliness; simplified procedures for the use of 
investigational drugs for therapeutic purposes; greater 
reliance upon expert judgment in determining the safety and 
effectiveness of drugs; concurrent review of portions of new 
drug applications by FDA; and greater reliance on foreign 
studies. Some of the Commission's recommendations are 
incorporated in S. 830.
    In 1988, concern about the slow process for the development 
and approval of AIDS and cancer drugs led to the establishment, 
under the auspices of the President's Cancer Panel, of a 
National Committee to Review Current Procedures for Approval of 
New Drugs for Cancer and AIDS. The committee's final report, 
issued in 1990, recommended a national policy to foster the 
development of new drugs for AIDS and cancer; expediting 
approval of important new drugs; greater use of scientific 
judgment of qualified experts in determining the effectiveness 
of new drugs; the use of surrogate end points to establish drug 
effectiveness; a more open relationship between the FDA and the 
regulated industry in order to foster a spirit of mutual 
cooperation; responsiveness to the needs of patient advocacy 
groups; a fundamental restructuring of the FDA advisory 
committee system; more flexible use of investigational drugs 
for treatment; the right of patients to obtain investigational 
drugs under expanded access conditions; greater use by the FDA 
of outside review of new drug applications; and automatic 
approval of supplemental new drug applications for minor 
technical changes such as manufacturing modifications. Again, 
many of these recommendations are incorporated in S. 830.
    In 1989, in response to serious questions that were being 
raised about the ability of the FDA to perform its job, 
Secretary of Health and Human Services, Dr. Louis Sullivan, 
chartered the Advisory Committee on the Food and Drug 
Administration. The committee was chaired by Dr. Charles 
Edwards, a former FDA commissioner. Dr. David Kessler served on 
the committee until his appointment as FDA commissioner. The 
charter directed the committee to examine the mission, 
responsibilities, and structure of the FDA and to make 
recommendations for improving the agency's operations.
    One of the major findings of the committee was the need for 
the FDA to set forth a clear statement of its mission and goals 
and a plan for achieving the goals. In formulating a statement 
of purpose and program goals, the committee found that--

          * * * the agency should be guided by the principle 
        that expeditious approval of useful and safe new 
        products enhances the health of the American people. 
        Approving such products can be as important as 
        preventing the marketing of harmful or ineffective 
        products. This is especially true for people with life-
        threatening illnesses and for diseases for which 
        alternative therapies have not been approved.

This key recommendation underlies the legislation's Mission 
Statement and many of the provisions found in S. 830.
    In 1991, The Council on Competitiveness, chaired by Vice 
President Dan Quayle, announced an important administration 
initiative to improve the FDA's drug approval process. The 
initiative was designed to achieve three overarching goals by 
1994--a substantial reduction in the average development and 
approval time for all new drugs; a reduction in FDA approval 
time for important new drugs to 6 months; and a reduction in 
FDA approval time to 12 months for all other drugs.
    The Council on Competitiveness also recommended a number of 
specific reforms, including expanded use of outside reviews; 
expanded use of advisory committees; flexible interpretation of 
the efficacy standard; accelerated approval through a reduction 
in the number of clinical studies required prior to approval 
and the amount of time FDA requires to grant approval, 
including reliance on surrogate endpoints; enhanced 
computerization to track applications and expedite review; and 
enhanced internal management, including the measurement of 
progress in application review against statutory deadlines. 
Many of these recommendations are incorporated in S. 830.
    Most recently, Vice President Gore has pressed for reform 
of the FDA product approval system as part of President 
Clinton's Reinventing Government initiative. The President and 
Vice President have issued six reports, covering drugs and 
medical devices, drugs made from biotechnology, food, and 
cancer drugs, animal drugs, and human tissue. The 
administrative reforms and recommendations in these reports are 
designed to improve the product approval system, eliminate 
outmoded regulations, and update the Federal Food, Drug, and 
Cosmetic Act to reflect advances in the science of new product 
development and testing. Many of the recommendations in these 
reports are incorporated in S. 830.
    During the 104th Congress, the committee held four hearings 
on reforming the FDA. The witnesses--several of whom had served 
on these advisory panels--testified about the same problems 
that have been described in the reports summarized above and 
recommended many of the same solutions. As a result of those 
hearings the committee last year reported legislation with 
strong bipartisan support, S. 1477, that would have 
incorporated many of the recommendations discussed above. In 
addition, during the 104th Congress, action was taken to better 
acknowledge the global marketplace and facilitate United States 
manufacturer's ability to get medical products to doctors and 
patients overseas through passage of the Food and Drug Export 
Reforms contained in P.L. 104-134.
    Most recently, this committee has continued the effort to 
modernize and bring greater accountability to the FDA. The 
committee held two hearings in early 1997. During the first the 
committee received testimony from the lead FDA Deputy 
Commissioner, Dr. Michael Friedman, and all of the FDA Center 
Directors. The second hearing included representatives from 
patient and consumer coalitions and from the food, drug, and 
medical device sectors regulated by the FDA.
    The committee learned from the administrative reforms and 
the progress it has already undertaken, areas that remain a 
challenge, and those areas that require legislative authority 
to change.
    The committee listened to consumers' concerns about 
provisions that were considered last year that they felt would 
weaken the FDA's ability to protect the public health. Finally, 
the committee learned of the ongoing and needless delays and 
frustrations facing the health care and consumer product 
sectors of our economy in working with the FDA. The committee 
learned of the frustrated attempts to work through the 
bureaucratic maze of needless regulatory delays--delays that 
prohibited people from getting access to vitally needed, life 
saving medical treatments, drugs and devices.
    Every administration in the past 20 years has recognized 
the need for modernizing the FDA's product approval system to 
bring into better balance the need to ensure the safety and 
effectiveness of products and the need to facilitate the 
development, testing, and timely approval of safe and effective 
products that benefit the public. Until recently, the FDA has 
been very slow to respond, or has not responded at all, to 
recommendations for reform made by the distinguished advisory 
panels that have been convened over the years.
    America's pharmaceutical, biotech, medical device, and food 
industries are among our most innovative, dynamic, and 
productive. They contribute significantly to our Nation's high 
standard of health care and to our unparalleled supply of 
wholesome, abundant, and affordable food. They hold the promise 
of further breakthroughs in life-saving and enhancing therapies 
to combat the diseases and disabling conditions afflicting us 
today and those which may emerge in the future. They hold the 
promise of new food technologies that will enhance diets and 
improve health, provide natural resistance to pests, droughts, 
and other plagues, and help meet the nutritional needs of a 
growing world population. They are job-creating industries that 
contribute positively to our balance of trade.
    Formidable challenges must be met, however, if these 
opportunities are to be realized and America is to continue to 
lead the world in product innovation. Domestically, our health 
care system is rapidly reorganizing, consolidating, and moving 
into managed care, with potentially profound effects on the 
market for products and the revenues necessary for continued 
research and product development. International markets are 
becoming increasingly competitive, particularly as the European 
Union moves to adopt a uniform drug and device approval system.
    If we are to confront these challenges and realized the 
opportunities on today's and tomorrow's horizons, we cannot 
afford an overly complex, bureaucratic, time-consuming, and 
expensive regulatory system. Nor can we afford an adversarial 
relationship between the FDA and the industries it regulates or 
an agency pursuing so many agendas that it lacks a clear-cut 
mission and sphere of responsibility. We must update our food 
and drug laws and our regulatory practices to reflect the 
scientific and technological advances that have occurred in the 
development and testing of new products and to ensure that the 
FDA is an agency committed to fostering innovation and ensuring 
timely public access to beneficial new products.
    It is no easy task that Americans ask FDA to perform. 
Americans want it to hold the gate to the market tightly shut 
against unsafe or ineffective products while opening it wide 
for the next generation of innovation--with all of its 
potential promise, but not without its risks. Clear statutory 
guidance is needed to assist the Agency to find this delicate 
balance and to bring our food and drug laws and regulatory 
systems into the next century. The FDA Modernization and 
Accountability Act of 1997, S. 830, embodies many of the 
bipartisan conclusions and recommendations reached by the 
expert panels for accomplishing this difficult task of 
balancing risk and promise.

            III. Legislative History and Votes in Committee

    ``The Food and Drug Administration Modernization and 
Accountability Act of 1997,'' S. 830, was introduced by Senator 
Jeffords on June 5, 1997. Prior to the drafting of the 
legislation, the committee held 2 days of hearings: on March 19 
and April 11, 1997, entitled ``Addressing the FDA's 
Performance, Efficiency, and Use of Resources.'' These hearings 
examined the challenges and opportunities facing our Nation's 
pharmaceutical, biotech, medical device, and food industries 
and ways that the FDA's regulation of these industries might 
need to be reformed to ensure that these challenges are met and 
opportunities realized.
    On June 11 and 18, 1997, the committee held executive 
sessions to consider S. 830. Senator Jeffords offered an 
amendment in the nature of a substitute that was considered as 
original text for purposes of further amendment. Thirteen 
additional amendments were considered in the executive sessions 
and the substitute as amended was adopted on a roll call vote 
of 14 yeas to 4 nays. S. 830, as amended, was approved by voice 
vote.

   A. Amendments and Motions Adopted by Voice Vote During Executive 
                                Sessions

    Six amendments were adopted in the executive sessions by 
voice vote and one amendment was adopted by unanimous consent.
    1. Senator Kennedy offered an amendment to section 609 to 
clarify key definitions of radiopharmaceuticals. The bill 
provided that the Secretary shall, within 18 months after 
enactment of this Act, promulgate regulations that shall 
provide that the determination of the safety and effectiveness 
of a radiopharmaceutical shall include, but not be limited to, 
consideration of the proposed use of the radiopharmaceutical in 
the practice of medicine, the pharmacological and toxicological 
activity of the pharmaceutical (including any carrier or ligand 
component of the radiopharmaceutical), and the estimated 
absorbed radiation dose of the radiopharmaceutical. These 
standards were further clarified by Senator Kennedy's 
amendment.
    2. Senator Kennedy offered an amendment to section 613 
which provides for the expedited approval of certain drugs 
intended for the treatment of serious or life-threatening 
conditions. The amendment provides that approval of drugs under 
this ``fast track'' process may be subject to a requirement 
that the sponsor submit copies of all promotional materials 
related to the fast track drug during the preapproval review 
period and, following approval, at least 30 days prior to 
dissemination of the materials for such period of time as the 
Secretary deems appropriate. In addition, the amendment 
clarifies the conditions under which incomplete applications 
may be accepted for filing review, establishes expedited 
procedures for the withdrawal of approval of a fast track drug, 
and, provides that within 1 year after enactment of this Act 
the Secretary shall issue guidance describing the policies and 
procedures related to fast track drugs.
    3. Senator Dodd offered an amendment to the Public Health 
Service Act that would establish, under a new section 807, a 
one-stop shopping information service for individuals with 
serious or life-threatening diseases.
    4. Senator Jeffords offered an amendment to modify a series 
of amendments that had been filed June 11 for which further 
agreement had been reached.
    5. Senator Kennedy offered an amendment to strike section 
611 of S. 830 relating to supplemental applications for the 
approval of new uses of approved drugs and devices and replace 
that section with alternative provisions to improve the FDA's 
supplemental application review process.
    6. Senator Hutchinson offered an amendment to authorize and 
clarify provisions related to the pharmacy compounding of 
drugs.
    7. Senator Gregg offered an amendment related to health 
claims for food products that was accepted by unanimous consent 
as a modification of the health claims language included in S. 
830. The provision extends from 90 to 120 the number of days a 
person would be required to submit to the Secretary a notice of 
the health claim prior to first introduction of the health 
claim into interstate commerce. The amendment also clarifies 
that false and misleading claims are prohibited under section 
403(a) of the Act, and that ``significant scientific 
agreement'' is required as the basis for a health claim, as 
required by section 403(r)(3)(B) of the Act. In addition, the 
amendment clarifies that the Secretary may undertake rulemaking 
to stop the use of a claim, or go to court in an enforcement 
proceeding, at any point in time.

         B. RollCall Votes Taken During The Executive Sessions

    Six rollcall votes on amendments were taken during the 
executive session:
    1. Senator Kennedy offered an amendment to strike the 
provisions related to health claims for food products. The 
amendment was defeated by a rollcall vote of 5 yeas to 13 nays.
        Yeas                          Nays
Kennedy
Bingaman
Wellstone
Murray
Reed                                Jeffords
                                    Coats
                                    Gregg
                                    Frist
                                    DeWine
                                    Enzi
                                    Hutchinson
                                    Collins
                                    Warner
                                    McConnell
                                    Dodd
                                    Harkin
                                    Mikulski
    2. Senator Gregg offered an amendment to prohibit State and 
local governments from establishing or continuing any 
requirement relating to the regulation of nonprescription drugs 
or cosmetics which is different from, or in addition to, or 
otherwise not identical with Federal requirements. The 
amendment permits States to apply to the Secretary for an 
exemption from the prohibition and propose a requirement which 
is justified by protecting an important public interest that 
would otherwise be unprotected, that would not cause the 
nonprescription drug or cosmetic to be in violation of any 
applicable requirement or prohibition under Federal law, and 
that would not unduly burden interstate commerce. The amendment 
was adopted on a rollcall vote of 15 yeas to 3 nays.
        Yeas                          Nays
Jeffords
Coats
Gregg
Frist
Enzi
Hutchinson
Collins
Warner
McConnell
Dodd
Harkin
Mikulski
Bingaman
Wellstone
Reed                                DeWine
                                    Kennedy
                                    Murray
    3. Senator Kennedy offered an amendment to provide the FDA 
with authority to level civil monetary penalties for failure of 
a company to perform post-approval research. The amendment was 
defeated by a rollcall vote of 6 yeas to 12 nays.
        Yeas                          Nays
Kennedy
Wellstone
Bingaman
Murray
Reed                                Jeffords
                                    Coats
                                    Gregg
                                    Frist
                                    DeWine
                                    Enzi
                                    Hutchinson
                                    Collins
                                    Warner
                                    McConnell
                                    Dodd
                                    Harkin
                                    Mikulski
    4. Senator Harkin offered an amendment to the provision 
pertaining to the review of medical device applications by 
organizations accredited by the FDA. Senator Harkin's amendment 
would have required the Secretary to check for conflicts of 
interest and review the terms of compensation between the 
accredited party reviewer and the manufacturer of the product 
to be reviewed. Prior to the roll call vote, Senator Harkin 
modified his amendment by clarifying that the Secretary would 
have the authority to review the terms of the compensation, but 
not be required to do so. The amendment was defeated on a 
rollcall vote of 8 yeas to 10 nays.
        Yeas                          Nays
Kennedy
Dodd
Harkin
Mikulski
Bingaman
Wellstone
Murray
Reed                                Jeffords
                                    Coats
                                    Gregg
                                    Frist
                                    DeWine
                                    Enzi
                                    Hutchinson
                                    Collins
                                    Warner
                                    McConnell
    5. Senator Harkin offered an amendment to: (1) limit scope 
of reviews of medical devices by organizations accredited by 
the FDA to devices for which the agency has not required 
clinical data, (2) limit the scope to devices for which the 
agency has prepared vertical standards or guidance documents, 
and (3) reduce by half the number of devices required to be 
eligible for the pilot. The amendment was defeated by a 
rollcall vote of 6 yeas to 12 nays.
        Yeas                          Nays
Kennedy
Harkin
Bingaman
Wellstone
Murray
Reed                                Jeffords
                                    Coats
                                    Gregg
                                    Frist
                                    DeWine
                                    Enzi
                                    Hutchinson
                                    Collins
                                    Warner
                                    McConnell
                                    Dodd
                                    Mikulski
    6. Senator Jeffords offered the substitute as amended by 
the committee and it was passed on a rollcall vote of 14 yeas 
to 4 nays.
        Yeas                          Nays
Jeffords
Coats
Gregg
Frist
DeWine
Enzi
Hutchinson
Collins
Warner
McConnell
Dodd
Mikulski
Wellstone
Murray                              Kennedy
                                    Harkin
                                    Bingaman
                                    Reed

         C. FOUR AMENDMENTS OFFERED AND SUBSEQUENTLY WITHDRAWN

    1. Senator McConnell offered and then withdrew two 
amendments related to food labeling.
    2. Senator Gregg offered and then withdrew an amendment to 
modify the drug fees provision.
    3. Senator Harkin offered and then withdrew an amendment to 
permit an individual to be treated by a health care 
practitioner with any method of medical treatment such an 
individual requests.

         IV. Explanation of the Legislation and Committee Views

                   TITLE I--IMPROVING PATIENT ACCESS

Mission

    The first title of S. 830 establishes in statute that the 
mission of the FDA is to protect the public health by ensuring 
that foods are safe, wholesome, and sanitary; human and 
veterinary drugs are safe and effective; there is a reasonable 
assurance of safety and effectiveness of devices intended for 
human use; cosmetics are safe and properly labeled; and the 
public health and safety are protected from electronic product 
radiation. In addition, the FDA shall promptly and efficiently 
review clinical research and take appropriate action on the 
marketing of regulated products in a manner that does not 
unduly impede innovation or product availability. The FDA shall 
participate with other countries to reduce the burden of 
regulation, to harmonize regulatory requirements, and to 
achieve appropriate reciprocal arrangements.
    The committee concurs with the view of the Advisory 
Committee on Food and Drug Administration (discussed above) 
that ``the agency should be guided by the principle that 
expeditious approval of useful and safe new products enhances 
the health of the American people. Approving such products can 
be as important as preventing the marketing of harmful or 
ineffective products.''
    From the 1906 Food and Drugs Act through the 1990 Safe 
Medical Devices Act, food and drug law has emphasized that the 
duty of the FDA is to protect the public against unsafe or 
ineffective products. The purpose of this legislation, as 
reflected in the mission statement, is to continue protection 
of the public against unsafe or ineffective products while 
providing a better balance in the law by ensuring timely access 
to safe and effective products.

Expanded access to investigational therapies

    For many years, the need for patients to have access to 
unapproved therapies went unrecognized under the Federal Food, 
Drug and Cosmetic Act. The FDA established informal policies 
relating to compassionate use of investigational products 
shortly affer enactment of the 1938 Act, but these policies 
remained informal and outside FDA regulations.
    Recently the FDA has established programs some of which are 
embodied in regulation, to make investigational drugs and 
devices available to patient with serious and life-threatening 
conditions and to patients in emergency situations. Most (but 
not all) such programs have resulted in access to promising new 
investigational and experimental therapies for HIV/AIDS and 
cancer. The committee commends the FDA for adopting these 
needed programs but the committee wishes to provide statutory 
direction to expanded access programs and emphasize that 
opportunities to participate in expanded access programs are 
available to every individual with a life-threatening or 
seriously debilitating illness for which there is not an 
effective, approved therapy.
    The legislation establishes in statute that any person, 
acting through a licensed physician, may request access to an 
unapproved investigational drug or device, and that any 
manufacturer or distributor may provide that unapproved 
product, if it is for the diagnosis, monitoring, or treatment 
of a serious disease or condition, an immediately life-
threatening or seriously debilitating disease or condition, or 
any other disease or condition designated by the FDA as 
appropriate for expanded access. The Secretary is given 
oversight over key aspects of this process to ensure that there 
is sufficient evidence of safety and efficacy to support the 
use of the investigational drug or device outside of a clinical 
trial. Further, the Secretary must determine that expanded 
access will not interfere with the adequate enrollment of 
patients into clinical trials for the testing of the drug or 
device.
    The physician must determine that a patient has no 
comparable or satisfactory alternative and that the risk from 
the investigational product is not greater than the risk from 
the disease. An exemption for the investigational drug or 
device must be in effect under the FFDCA. The manufacturer must 
be pursuing marketing approval with due diligence. A 
manufacturer or distributor may decline to make an 
investigational product available under such a program.
    Consistent with the desire of the committee to help ensure 
that patients with serious conditions and no realistic 
alternative treatment shave available to them investigational 
products that may offer some promise of help, the legislation 
requires the Commissioner to inform the medical profession and 
such groups as voluntary health associations about the 
availability of investigational products for expanded access 
use. Too often, patients and their physicians are unaware that 
new drugs and devices are under investigation and are available 
for expanded use pending review by the FDA. This provision will 
help to ensure that all patients will have equal knowledge of 
and access to investigational products.
    The committee emphasizes that it has purposely used broad 
language in this section relating to ``serious'' conditions, 
without attempting to define them, in order to permit wide 
flexibility in implementation. Illnesses that do not cause 
death can nonetheless destroy the lives of both patients and 
their families. The committee therefore intends that the 
seriousness of an illness be given broad consideration, to take 
into account all of the circumstances involved.

Expanded humanitarian use of devices

    The Safe Medical Devices Act of 1990 included a new 
provision authorizing the use of devices for humanitarian 
purposes for small populations of targeted patients for whom 
products are not generally available to treat or cure a 
condition or disease. This provision permits device approval 
based on specified safety criteria and exempts effectiveness 
showings from approval requirements. The provision required the 
Secretary to issue implementing regulations within 1 year. 
However, final regulations were not promulgated until June of 
1996 and only became effective in October of that year--almost 
7 years after the provision became law.
    The regulations currently provide for a 45-day designation 
period and a 180-day review period to show safety (compared 
with the 30-day period now required to show safety under an 
investigational device exemption (IDE) and the 180-day period 
required under a PMA to show safety and effectiveness). The 
legislation would provide for a 60-day period to review the 
safety showing. This period is greater than that required for a 
response to an investigational device exemption application, 
which requires a finding that a device is sufficiently safe for 
use in humans, but less than the 180-day period required for a 
showing of safety and effectiveness under a premarket approval 
application.
    The statute currently requires an institutional review 
board (IRB) to approve use of the product before the product 
may be used. However, because some IRB's typically meet 
infrequently a patient is at risk of harm or death if the IRB 
is unable to consider a physician's request. This proposal 
would permit a physician to approve use of the product where 
the patient would suffer harm or death waiting for the approval 
if the physician in good faith is unable to secure IRB 
consideration but later notifies the IRB.
    Finally, current law requires the company to reprove its 
exemption every 18 months even if there is no basis for 
doubting the status of the exemption. Further, the program 
automatically expires after 5 years. This proposal would 
require the company to reprove its exemption when the Secretary 
has cause for requiring such showing; and no longer requires a 
sunset of the program.

         Title II--Increasing Access to Expertise and Resources

Interagency collaboration and FDA facility consolidation

    The legislation requires the Secretary to implement 
programs and policies that will foster collaboration between 
the FDA, the National Institutes of Health, and other science-
based Federal agencies to enhance the scientific expertise 
available to the Commissioner for the evaluation of emerging 
medical therapies, including complementary therapies, and 
advances in nutrition and food science.
    The committee includes this provision to help ensure that 
the FDA has available to it the expertise and assistance it may 
need to enhance its own capacity for the efficient evaluation 
of applications for the approval of products that pose 
substantial new scientific or technical issues.
    The committee strongly supports the consolidation of FDA 
facilities at White Oak, MD, as proposed by the FDA in 
consultation with the General Services Administration (GSA). 
The consolidation of FDA's facilities into state-of-the-art 
laboratory space and supporting office space has great 
significance not only to the FDA, but to the Nation as a whole.
    FDA laboratories and facilities are now scattered among 50 
buildings at 20 locations in the Washington, DC, metropolitan 
area. Many of these facilities are old, poorly maintained, and 
do not meet accepted standards for laboratory research. These 
antiquated facilities and fragmentation of agency programs have 
proven burdensome in many ways. The cost of leasing space for 
FDA and the difficulty in managing programs that are so widely 
scattered in the Washington area is a tremendous burden for the 
FDA. The FDA cannot do its job if it does not have the tools it 
needs to accomplish its mission. The committee believes that 
providing the FDA with consolidated, modern, state-of-the-art 
facilities will enable the FDA to do its job faster and more 
efficiently, benefiting the taxpayer and the consumer.

Sense of the committee regarding mutual recognition agreements and 
        global harmonization efforts

    The U.S. Government has long been involved in negotiation--
an effort being spearheaded by the U.S. Trade Representative 
(USTR)--with representatives of the European Union (EU) 
Commission to achieve a mutual recognition agreement (MRA). The 
overall MRA, being directed by Under Secretary for 
International Trade Stuart Eizenstat and USTR Deputy Trade 
Representative Jeffrey Lang, has been estimated by the 
Department of Commerce as a possible savings to United States 
businesses of $100 million annually. The Commerce Department 
has also stated that this MRA will expedite $40 billion in 
transatlantic trade each year between the United States and the 
15-nation EU by eliminating trade barriers. The Department of 
Commerce and the USTR expect this agreement to provide 
especially strong benefits to the U.S. telecommunications 
industry, the U.S. medical device industry, and the U.S. 
pharmaceutical industry.
    Only recently have we gotten good news that an important 
portion of the MRA which involves the mutual recognition of 
inspection reports for good manufacturing practices (GMP) for 
medical device and pharmaceutical products, and medical device 
review standards may be close to an agreement. It is important 
to recognize these efforts for what they are: these agreements 
would not make GMP inspection or product review necessarily 
uniform but would allow equivalent regulatory bodies to conduct 
a single review or inspection that would satisfy all of the 
criteria for all of the countries concerned, instead of 
conducting multiple inspections, often at great costs. The 
committee intends and specifically instructs the FDA to promote 
and protect the health of the American public in implementing 
the MRA. The MRA should not place U.S. consumers of drugs and 
devices at risk, nor adversely affect the quality, quantity, or 
variety of drugs available to the American public.
    This MRA also will lay a flagstone in the path being built 
toward harmonization activities on things like increased 
reliance on international standards, an effort the Food and 
Drug Administration and professional groups are already engaged 
in with their foreign counterparts. This is an especially 
important effort in light of the extent to which our 
marketplace has become globalized.
    There was agreement by President Clinton and his European 
counterparts at last December's U.S.-EU Summit meeting that 
this MRA represents a critical point that has taken a number of 
yearsto reach. The United States was recently urged by 
President Santer of the European Commission to achieve a successful 
conclusion of these negotiations, and the committee is pleased to see 
that the excellent effort coordinated by USTR is close to having 
positive results.
    The committee looks forward to seeing more global 
partnership in the form of a quality mutual recognition 
agreement that compliments both our high public health and 
safety standards in the United States and appropriate 
international regulatory controls. As noted by Commerce 
Secretary Richard Daley, ``Under this landmark agreement U.S. 
regulatory agencies for the first time have entered into a 
cooperative international agreement that strives to reduce 
regulatory costs while at the same time seeks to expand market 
access and protect the health and safety of consumers on both 
sides of the Atlantic.''

Contracts for expert review

    For many years, the FDA has contracted with outside 
individuals and organizations to review part or all of product 
applications or Agency decisions respecting the safety and 
effectiveness of marketed products. The FDA contracted with the 
National Academy of Sciences (NAS) to review the effectiveness 
of all new drugs for which new drug applications were made 
effective during 1938-62 and with the Federation of American 
Societies for Experimental Biology (FASEB) to review the safety 
of all food substances that the Agency had earlier determined 
to be generally recognized as safe for their intended use in 
food. The FDA has contracted with individual experts to review 
aspects of new drug applications and recently contracted with 
the Mitre Corporation (now incorporated as Mitretek 
Corporation) to review supplements to new drug applications. 
Finally, the FDA has developed a pilot program for third-party 
review of class I and class II medical device submissions, a 
step beyond traditional Agency contracting out activities.
    There are sound reasons for using outside individuals and 
organizations to review, evaluate, and make conclusions and 
recommendations to the FDA with respect to applications 
submitted to the FDA. In some instances, individuals outside 
the FDA have unique expertise not available to the agency. In 
other instances, the FDA's internal resources are inadequate to 
handle surges in the workload. In still other instances, 
internal FDA resources must be focused on priority matters and 
cannot be diverted to more routine matters that become 
backlogged. The FDA has in the past used outside individuals 
and organizations for these reasons.
    The legislation explicitly authorizes the FDA to contract 
with outside individuals and organizations with expertise in 
relevant disciplines to review, evaluate, and make conclusions 
and recommendations to the FDA on any form of submission made 
to the agency. Under this legislation, the FDA retains full 
authority to make any determinations with respect to the 
classification, approval, or disapproval of any product. Thus, 
although outside experts will assist and advise the FDA, they 
cannot commit or make any final decision for the agency. Final 
action must be a function solely within the power of the FDA. 
However, the FDA is advised not to arbitrarily or 
systematically disregard the recommendations of the reviewers 
it has accredited and qualified or to redo without cause the 
work completed by such reviewers.
    The legislation requires the FDA to use its authority to 
use outside experts under contract (on a basis other than a 
``pilot'' or ``demonstration'' basis) whenever the Secretary 
determines that doing so will improve the timeliness or quality 
of the review of an application or submission. It is the intent 
of the committee that improvements to application or submission 
review may include providing the Secretary with increased 
scientific or technical expertise necessary to review or 
evaluate new therapies or technologies. It is not the intent of 
the committee that the FDA be compelled to use an outside 
expert when the timeliness of a review would be improved yet 
the quality of that review would unduly suffer or vice versa. 
Rater, the FDA should wisely and rationally use this authority 
as a tool to manage an increasing workload in an era of flat or 
declining resources available to the Federal government, and 
bring to bear outside expertise when it is helpful.

Accredited party reviews

    In recent years, the FDA has consumed substantially more 
and more time for the review of medical devices than in past 
years. For example, FDA's average review time for premarket 
notificationclassifications has increased in the years 1990 to 
1996 by well over 100 percent (from 82 days to 178 days for a total 
review time; from 66 days to 137 days for time in the FDA's hands) 
while the number of applications has generally held steady. In 
addition, premarket approval times have increased (from 348 to 773 
total days, 247 to 606 days in FDA's hands) on average, while 
submissions in the same 6 year period dropped from 84 to 43 (almost in 
half). By statute, premarket notification classifications are expected 
within 90 days and premarket approvals must be granted or denied within 
180 days.
    Although the agency represents that review times for 
devices have dropped recently, the agency's current budget 
justification confirms continued cause for concern. Even given 
a net resource increase of almost 4 percent, the agency 
anticipates a 17 percent increase in the backlog of pending PMA 
applications and a decline in timeliness of final actions on 
510(k) premarket notification submissions--from 59 percent 
within 90 days to only 40 percent. Again, this is in the 
context of declining numbers of 510(k) submissions and 
virtually steady PMA applications.
    This delay is in part a consequence of the agency's 
difficulty in maintaining the technological expertise and 
capability necessary to review applications within the 
statutory timeframe. Also contributing to this delay is the 
FDA's management of its resources. The FDA has regularly made 
this committee and others aware of its desire to have more 
resources in order to address its inability to review products 
within the statutory time frame. In past years, Congress has 
responded with increasing appropriations. However, as resources 
available to the Federal Government have tightened, the agency 
and Congress have been pressed to find alternative sources of 
revenue.
    In August 1996, the agency responded by establishing a 
``third party'' pilot program to review a very limited number 
of device submissions. For reasons discussed below, that pilot 
has not been useful in providing alternative revenue sources or 
in gauging the effectiveness of ``third party'' review. As a 
result, the committee decided to expand the agency's pilot 
program to better supplement FDA resources with fees paid by a 
product sponsor directly to FDA-accredited reviewers and to 
supplement FDA expertise with that of other public and private 
parties. Ultimately, the committee believes that this expansion 
will reduce delays in medical device reviews and improve the 
technical sophistication of those reviews.
    The legislation provides that accredited individuals and 
organizations with relevant expertise will, at the option of a 
product sponsor, be used to provide recommendations to the FDA 
regarding premarket notifications and premarket approval 
applications. The FDA will then review those recommendations 
and make a final decision with respect to classification or 
approval or disapproval of the premarket approval application.
    The provision maintains a strong, continued role for the 
FDA in the device approval process. For example, the FDA alone 
accredits the pool of qualified private parties to conduct the 
reviews and selects from that pool two or more accredited 
parties from whom the product sponsor may select. Although a 
product sponsor has the option to select an accredited party, 
it does so only from a list pre-selected and accredited by the 
FDA, thus limiting if not eliminating potential ``forum 
shopping'' as it does in its current pilot. The FDA also 
establishes rules protecting the confidentiality and the 
proprietary nature of information contained in the review. The 
FDA promulgates the rules to prevent conflict of interest. The 
FDA has authority to ensure compliance by the accrediting party 
and has the ability to withdraw or suspend accreditation of 
parties not in compliance. In short, the FDA will have all 
necessary control over the individuals and organizations 
eligible for selection.
    The FDA's role is not limited to accredited-party 
selection. In addition, the Agency retains all of the authority 
it has under current law to make final product review 
decisions. This legislation does not authorize any other person 
or organization outside the agency to make such a final 
decision. The FDA will have no less than 30 days (of the 90 
days allotted under the statute) to review a submission under 
section 510(k) and 60 days (of 180 days under statute) to 
review a premarket approval application. Again, the agency is 
not bound by an accredited party's determination--there is no 
presumption given to the accredited party's recommendation of 
approvability or classification of a product.
    The provision expands the types of device submissions that 
may be considered under the current agency pilot program. 
Thecurrent program is open to nonexempt class I devices and a limited 
number (approximately 30 at this time) of class II devices. However, 
because of the limited scope of the pilot fewer than 10 submissions 
have been considered under the pilot in the initial 10 months of its 
planned 24-month existence. S. 830 would permit any 510(k) device into 
the program with several exceptions: specifically, devices that are 
life-supporting, life-sustaining, or intended for implantation for a 
period of over 1 year. However, the agency retains discretion to allow 
these devices to be reviewed by a third party.
    As a supplement to the resources available to the FDA, the 
product sponsor will directly contract with and pay the 
accredited party at the sponsor's own expense. This mechanism 
is similar to that proposed by the FDA in its own pilot project 
at the Center for Devices and Radiological Health. As with the 
current pilot, the agency retains the ability to review 
invoices and fee schedules, and, if the agency has cause to 
believe that a party is engaged in forum shopping or if the 
submission presents some form of conflict of interest, the 
agency may review the terms of compensation prior to a 
particular review. The committee is aware that the Agency does 
not consider it a worthwhile or reasonable use of resources 
generally to preapprove or prereview compensation agreements.
    The agency's current pilot is clearly not sufficient to 
permit meaningfully evaluation of a program incorporating 
accredited-party reviewers. In large part, this is a result of 
the agency's insistence that no product be reviewed without a 
vertical standard or guidance document. While for some reviews 
this may be useful, for most reviews the committee believes 
that the agency has unwisely consumed resources in developing 
documents that its own employees have not been required to use 
for their own product reviews. In addition, the agency has 
accredited parties that it has certified as capable of 
preforming reviews, yet only allows them to do little more than 
follow a cookbook recipe for approval; and again, the agency 
does not subject its own reviewers to these constraints. 
Ultimately, through this policy, the agency has unreasonably 
constrained the scope of the pilot and rendered the pilot 
virtually without utility. Accordingly, the committee directs 
the agency, under the expanded pilot program, not to continue 
this practice except in the limited cases where it is essential 
to protect the public health. The expansion established under 
this provision will be subject to independent study within 5 
years of the agency's establishing an expanded pilot program 
with sufficient eligible products or within 4 years of the 
agency's expanding the program so that 35 percent of products 
are actually reviewed under the program. A full analysis of the 
strengths and weaknesses of the program will be conducted and 
provided to Congress and the public, enabling Congress to 
extend, modify, or discontinue the program at that time.

Device performance standards

    Long before the enactment of the Medical Device Amendments 
of 1976, voluntary standards-setting organization in the United 
States and abroad have established performance standards for 
categories and characteristics related to medical device 
products. These organizations include the American National 
Standards Institute (ANSI), the International Standards 
Organization (ISO), and the International Electrotechnical 
Commission (IEC), as well as others. Although standards from 
these organizations are recognized as authoritative, and are 
therefore followed throughout the world, the FDA has failed to 
establish any policy regarding their recognition and use under 
the Federal Food, Drug, and Cosmetic Act in this country. This 
legislation remedies that problem
    The legislation gives the FDA authority to recognize all or 
portions of appropriate medical device performance standards 
developed by organizations such as ANSI, ISO, IEC, and any 
other standards-setting organization. It is the intent of the 
committee that FDA can reduce the amount of effort required on 
its part to assess product applications and submissions which 
show conformity with a standard, recognized by FDA, as the 
basis for all or part of a product application or submission.
    The legislation establishes procedures for recognition by 
the agency of these standards, grants express authority to FDA 
to subsequently withdraw a recognized standard, and clearly 
establishes the FDA's authority to assure that devices that 
purport or are represented to be in conformance with a standard 
in fact meet the requirements of the standard identified with 
the device.
    It is important that all medical device performance 
standards recognized by the FDA under this new procedure be 
publicly listed, so that any interested person will know the 
regulatory status of the standard. Accordingly, the legislation 
requires FDA to public in the Federal Register the name of all 
standards to which recognition has been given. Any standard not 
on the published list would not be accepted as recognized by 
the FDA under this provision.
    Other provisions in the Federal Food, Drug, and Cosmetic 
Act authorize FDA to promulgate performance standards for 
medical devices using the procedures set forth in the law. This 
legislation does not in any way change the authority of FDA to 
promulgate such standards, which may differ from the standards 
established by certified organizations and recognized under 
this new provision.
    The FDA may not require conformity with any recognized 
standard as a condition for approving or classifying any type 
of medical device premarket submission if the submitter 
demonstrates with information other than that required by a 
recognized standard that the device is substantially equivalent 
to a legally marketed predicate device or otherwise provides 
reasonable assurance of safety and effectiveness.
    Importantly, reliance on a recognized standard in a 
premarket notification, a section 604 classification, or a 
premarket approval application, will not create a continuing 
compliance requirement such that legal modifications to devices 
may not be made. For example, a device classified into class II 
under section 604, subject to a special control performance 
standard, may be legally modified without maintaining 
compliance with the recognized standard, and without filing a 
510(k) submission, if the modification insignificantly affects 
safety or effectiveness. On the other hand, if the 510(k) were 
required, the person submitting the premarket notification 
could choose to rely on the standard or demonstrate substantial 
equivalence in another way.
    The committee notes that the amendment to section 501(e) is 
intended to ensure that statements or actions directed to the 
consuming public indicating conformance to a recognized 
standard must be correct. If they are not, the device will be 
considered adulterated. Additionally, section 301 is amended to 
create as prohibited acts false declarations of conformity to a 
recognized standard or the withholding of information required 
to be provided to the Secretary under this provision.
    Although most national and international standards 
development organizations use a consensus based approach that 
allows interested parties to participate in the development of 
performance standards, the committee recognizes the importance 
of public participation in agency decision making. Therefore, 
the committee is recommending that the FDA provide the public 
an opportunity to comment on agency decisions to recognize 
standards on a case-by-case basis when a particular standard 
may warrant or benefit from further public comment. The 
committee is not recommending that the Agency use notice and 
comment rulemaking to recognize these standards because their 
use by industry is voluntary. Instead, the committee is 
recommending that the agency, as appropriate, provide the 
public a reasonable opportunity to comment in a way that is 
consistent with the agency's recently issued Good Guidance 
Practices.

         Title III--Improving Collaboration and Communications

Collaborative determinations of device data requirements

    The committee is aware that persons who submit premarket 
approval applications and the FDA not infrequently disagree on 
what constitutes an appropriate showing of device 
effectiveness. Significantly, and unfortunately, this conflict 
at times emerges well into the review process, when it may be 
too late to remedy. Although the agency has been willing to 
meet with persons who intend to submit investigational device 
exemption applications, the committee believes that a special 
meeting to determine the scientific showing for device 
effectiveness is necessary and will prove to be an investment 
against the significant costs to companies and the FDA related 
to review process conflicts over device effectiveness showings. 
The vehicle for obtaining a meeting to determine the type of 
valid scientific evidence necessary to demonstrate 
effectiveness will be a written request which sets forth a full 
device description, a detailed description of the conditions of 
use and, when available, information about the device's 
expected performance. Within 30 days of the meeting, FDA will 
provide its written response identifying the types of evidence 
that will demonstrate effectiveness for a specified device for 
a particular use.
    The committee intends that FDA will be found by its 
determination of device effectiveness requirements, unless 
holding the agency to its determination is contrary to the 
public health or, based on new information, the determination 
is scientifically inappropriate. Importantly, ``new 
information'' may not include a re-examination of the 
information before the FDA when the agency made its 
determination of types of scientific evidence needed to show 
effectiveness. In other words, when public health protection 
requires a change in direction, the committee intends that such 
change will occur. However, this provision is intended to 
establish an institutional commitment within the FDA to stand 
by its advice regarding appropriate scientific showings and to 
thoroughly consider the implications of such advice, when 
given.
    The intent of this provision is to be a starting point for 
designing an investigational plan; it should only result in a 
specification of the types of valid scientific evidence that 
will demonstrate effectiveness. The provision is not intended 
to address the development of a complete device investigational 
plan.
    This amendment of section 513(a)(3) is also intended to 
carry through the philosophy of the ``Medical Device Amendments 
of 1976.'' Those amendments were committed to avoiding 
overregulation of devices. Section 301 achieves this laudable 
goal by requiring that the FDA's specification of the types of 
evidence to demonstrate a reasonable assurance of effectiveness 
``result [from] a determination by the [Agency] that such data 
are necessary to establish device effectiveness and that no 
other less burdensome means of evaluation device effectiveness 
is available which would have a reasonable likelihood of 
resulting in an approval.'' Simply put, the FDA may not ask for 
the ultimate study to prove effectiveness. It must ask for the 
least burdensome type of valid scientific evidence that will 
meet Congress' criteria for effectiveness. It is Congress' 
formulation for proving effectiveness that counts. FDA has 
never had freedom to require evidentiary showings that exceed 
what is required under the law for an approval. This provision 
reinforces that fact.

Collaborative review process

    Consistent with a purpose behind section 310, the committee 
intends that section 302 facilitate communications between FDA 
and persons who submit premarket approval applications to 
improve the efficiency of the device review process. Because 
the committee is aware that the FDA has failed to timely review 
PMA's, this bill includes a provision requiring a 180-day 
review that cannot be extended or modified by the agency's 
request for an amendment of the PMA. Instead, when the agency 
desires additional information, the regulatory review clock 
will stop until the applicant responds to the agency's request, 
including a response that the applicant will rest on its 
application as is. The committee intends that the 100 day 
meeting required by section 302 will occur a bit after the 
midpoint in the 180-day review process and will reinforce the 
180 day review deadline by requiring the FDA to identify the 
deficiencies that would preclude an approval of the PMA.
    This requirement will force the agency to critically 
consider the PMA up front in the review circle and not wait 
until late in the review process, which has all too often been 
the agency's pattern. Additionally, the section will require 
FDA to describe the information necessary to bring the PMA into 
an approval form, a form in which the FDA would be prepared to 
approve the pending PMA if certain tasks, excluding clinical 
investigations, were outstanding and reasonably capable of 
being accomplished within a reasonably short period of time. 
Both the statement of deficiencies and advice to improve the 
PMA are to be in writing and made available to the applicant 
prior to the meeting. Importantly, any deficiency discovered by 
the agency after the 100-day meeting, must be reduced to 
writing by the Agency and immediately provided to the 
applicant. For purposes of this provision ``immediately'' shall 
mean within 48 hours of an agency employee becoming aware of 
the deficiency.

           Title IV--Improving Certainty and Clarity of Rules

Policy statements

    In the past decade, the FDA has relied less on developing 
its policies and procedures through formal, public, or binding 
mechanisms such as promulgating regulations and more on the use 
of informal policy statements, including guidelines, points to 
consider, and memoranda, generally without the benefit of 
public comment. This has had the advantage of consuming fewer 
agency resources than the cumbersome process of promulgating 
substantive regulations and permits the agency to respond more 
quickly and efficiently to requests for policy guidance.
    However, the FDA's increasing reliance on policy statements 
has also produced several problems. First, until recently, the 
FDA has maintained no compilation of these documents. The 
regulated industries and the public were often not aware that 
they existed or did not know how they could be found. Second, 
until recently, there was no systematic process for their 
adoption or amendment. There may or may not have been an 
opportunity for interested outside individuals and 
organizations to have any input into their formulation or 
amendment. Third, there was inconsistency among FDA personnel 
in the use of these documents. Some FDA employees insisted that 
industry strictly follow them, and others did not.
    In February 1997, FDA published in the Federal Register (62 
Fed. Reg. 8961) the Good Guidance Practices document 
identifying policies for the development, issuance, and use of 
guidance documents. The committee recognizes that this new 
policy on guidance has only been effective for a short time and 
that it is premature for the Congress to require FDA to 
promulgate this new policy as a regulation without adequate 
time to assess the success of this policy and consider 
modifications, if any, that should be made to the policy. 
However, it is the committee's intent that ultimately, the 
policies governing guidance documents and informal policies be 
in regulation. Therefore, the legislation requires that FDA 
promulgate a regulation specifying the policies and procedures 
of the FDA for the development, issuance, and use of guidance 
documents by February 27, 1999.

Product classification

    It is often difficult for an applicant to determine the 
proper classification of a product as a drug, biological 
product, or device. Even where the classification of the 
product is known, the proper organizational center in the FDA 
where the application will be handled can be uncertain. The 
legislation therefore provides that, within 60 days of receipt 
of a written request, the FDA must provide an applicant with a 
written determination regarding the classification of the 
product or the component of FDA within which it will be 
handled, or both. This determination is binding. If the FDA 
fails to meet this requirement, the applicant's designation 
shall be final and binding. However, the FDA is given authority 
to modify these otherwise binding determinations and 
designations for public health reasons.

Use of data relating to premarket approval

    The committee recognizes that in some instances minor 
differences between separate versions of the same device can 
result in significant divergent performance characteristics and 
clinical results. Therefore, the FDA may find under Section 403 
of S. 830 that on occasion it may not be scientifically 
appropriate to utilize data from a single (or even a multiple) 
application to approve another device, determine whether a 
product development protocol has been completed for another 
device, or establish a performance standard or special control 
for another device.

Labeling claims for medical devices

    With the ``Medical Device Amendments of 1976,'' Congress 
intended that device classification and approval decisions be 
made based on the intended use of devices as described in 
labeling. Over the years, FDA has made premarket regulatory 
decisions based on uses for devices that are unrelated to the 
intended uses set forth in labeling. This section includes two 
provisions that express the committee's specific intention to 
limit FDA's review of premarket submissions to the proposed 
labeling before the agency. Considerations like cost 
effectiveness, relative effectiveness, or whether the product 
effects some improvement in a patient's ``quality of life,'' 
are irrelevant to a premarket review unless such claims are 
includedin proposed labeling. Simply put, the committee does 
not want FDA to exceed its jurisdictional responsibilities by 
incorporating into the review process claims not before the agency for 
review consideration.
    For premarket notification submissions, the labeling 
proposed in the submission will be controlling of a device's 
intended use. If the intended use is the same or sufficiently 
similar to the intended use of a predicate device, then the 
device may be found to be substantially equivalent to the 
predicate. No considerations outside of the proposed labeling 
for the 510(k) device should bear on the question of whether or 
not the proposed labeling of the newer device is compatible 
with the labeling of the predicate device.
    For premarket approval applications, the determination of 
whether or not there is a reasonable assurance of device safety 
and effectiveness must be based on claims in proposed labeling 
if such labeling is neither false nor misleading. The FDA may 
fairly consider all facts which are pertinent to proposed 
labeling in PMS's in determining whether or not the labeling is 
false or misleading. Facts which are ``pertinent'' to proposed 
labeling are those which directly relate to claims in such 
labeling. For example, proposed labeling stating that a device 
is for use in treating atherosclerosis cannot be false or 
misleading because another device is more effective for that 
purpose. Nor can the proposed labeling be false or misleading 
because another device provides the same treatment benefits but 
is less expensive to purchase and operate. However, the failure 
to state a material fact about the device itself will make 
labeling in a pending PMA false or misleading.

Definition of a day

    The committee has included in this legislation the 
codification of FDA's method of calculating a day, as that term 
is used in various places in the Act in which specified times 
for the FDA to complete statutory product review requirements 
are identified. The committee believes it is important to have 
a consistent understanding of a day both as a means for persons 
who make submissions to FDA to determine where in the review 
cycle their submission resides and to make FDA more accountable 
for the timeliness of its reviews. Concern has been expressed 
that FDA performance data are difficult to review because often 
it is difficult to determine what is being presented by the FDA 
for analysis. The committee hopes defining a day for product 
reviews will help lessen the difficulty experienced in 
evaluating FDA performance data.
    For purposes of determining the length of review of various 
specified product submissions, a ``day'' will be a calendar day 
in which the agency has responsibility to review a submission. 
The regulatory clock will not commence until the date a 
complete submission is received by the FDA. When the agency 
reviews a submission and requests additional information, the 
regulatory clock will stop on the date that such a request by 
FDA is made. The clock will re-commence when the additional 
information is received by the FDA or when the regulated person 
requests that the review continue.

Certainty of review timeframes

    In section 406, the committee set a timeframe for reviewing 
premarket notifications required under section 510(k). Also, a 
strict limit was placed on the 180 day requirement for PMA 
reviews.
    Historically, FDA has operated as if premarket notification 
classification determinations were required to be made in 90 
days. Indeed, the internal yardstick for success in reviewing 
these submission was the 90-day timeframe. The committee 
believes that to ensure accountability, and avoid the long 
review times seen from 1993 through 1996 for a majority of 
devices, it is important to codify this informal agency 
yardstick. This change in the Act should not create any 
disadvantage or hardship for the FDA because it does no more 
than put into law FDA's longstanding practice. Finally, with 
regard to the review time for PMA's, the legislation clearly 
states the committee's intent that FDA should approve or 
disapprove a PMA application within the 180-day timeframe set 
in the Act. The committee recognizes that this may result in 
the disapproval of PMA's that FDA today might continue to work 
on beyond the 180-day period in the well-intentioned effort of 
ultimately approving the PMA.

Limitations on initial classification determinations

    The committee included section 407 in S. 830 because of a 
concern that FDA was inappropriately using the device premarket 
notification process for compliance purposes and not solely for 
its intended purpose of classifying devices intended for 
introduction into interstate commerce after May 28, 1976, the 
enactment date of the ``Medical Device Amendments of 1976.'' 
Over the past five years, the FDA has withheld device 
classification determinations of substantial equivalence 
because of its belief that firms were not in compliance with 
good manufacturing practices. Such firms were placed on a 
``reference list'' and were not removed from the list until FDA 
was satisfied that such firms' facilities complied with GMPs. 
Once a reference list form satisfied FDA with its GMP program, 
the agency would complete a pending premarket notification 
review and device classifications would then occur.
    This process was unfair and denied device manufacturers an 
opportunity to dispute effectively FDA's allegations that firms 
were not in GMP compliance. FDA set itself up as judge and jury 
and, in essence, administratively enjoined the classification 
of devices until manufacturers satisfied the agency's view, 
notwithstanding a regulated person's disagreement with FDA.
    Clearly, FDA has substantial authority to enforce the Act 
against illegal devices and the persons who market them. It is 
unacceptable that the agency misuse premarket notification to 
avoid enforcing the Act. FDA can find a device substantially 
equivalent to a predicate device and still inform the device 
manufacturer that although the device is substantially 
equivalent it should not be marketed because of the agency's 
view that the device does not comply with the law in some 
specified respect. Then, if a person markets the device after 
such notice, FDA can enforce the Act. This approach was used by 
FDA for years before the advent of the reference list.
    Although the FDA announced some time ago that it had 
discontinued its reference list program, the committee is aware 
that the agency still has withheld premarket notification 
determinations for devices because of the agency's unilateral 
determination of a lack of GMP compliance. Accordingly, the 
committee believes this provision is essential to once and for 
all eliminate all reference-list-like programs. Simply put, 
initial classification determinations may not be withheld for 
any compliance-related reason under the Act, including any 
purported violation of GMPs.

Clarification with respect to a general use and specific use of a 
        device

    Section 408 of the bill represents the committee's interest 
in clarifying when devices with general intended use labeling 
may be predicates for substantially equivalence determinations 
for newer devices with more specific intended use statements. 
This clarification is important because FDA has not established 
a consistent pattern upon which persons who submit premarket 
notification may rely.
    To be substantially equivalent to a legally marketed 
device, a person intending to market a device must show, among 
other things, that a newer device has the same, or nearly the 
same, intended use as a legally marketed device. Some legally 
marketed devices, which are labeled for general uses, have been 
used as predicate devices for substantial equivalence 
determinations regarding newer devices with more specific 
claims, e.g., condoms labeled for prevention of sexually 
transmitted diseases were predicates for condoms labeled for 
HIV prevention. Here, FDA found that the condom labeled for a 
general use could be a predicate for a condom labeled for 
prevention of a specific sexually transmitted virus, HIV.
    This determination made perfect public health sense, 
despite the fact that the general use labeling pre-dated the 
``Medical Device Amendments of 1976'' and HIV was unknown at 
that time. Consequently, the specific use for HIV prevention 
could not have been included within the general use labeling 
for condoms. The committee's concern is that although the 
agency can make good determinations like the one just 
discussed, no policy exists regarding the availability of 
general use predicates for regulated persons to rely upon.
    The committee believes that FDA should state its policy 
regarding reliance on general use predicates in the context of 
a regulation. The regulation should state when reliance on a 
general use predicate is appropriate. FDA should permit 
premarket notification submitters to provide information 
showing that specific uses for a device are reasonably included 
within apredicate's general use. For example, if the medical 
literature shows that a newer device is used for several specific uses 
within a predicate's general use, then FDA should permit the general 
use predicate to be the basis for a substantial equivalence finding for 
the newer device. The FDA's regulation should seek to describe rules 
that the agency and industry can follow.

Clarification of the number of required clinical investigations for 
        approval

    The drug amendments of 1962 added to the Federal Food, Drug 
and Cosmetic Act the requirement that the effectiveness of a 
drug be established by ``substantial evidence,'' which is 
defined as adequate and well-controlled investigations, 
including clinical investigations, by qualified experts on the 
basis of which such experts could fairly and responsibly 
conclude that the drug will have the labeled effect.
    The committee believes that the science and practice of 
drug development and clinical evaluation have evolved 
significantly in the past 35 years, and this evolution has 
implications for the amount and type of data needed to support 
effectiveness in certain cases. Modern clinical trial design 
often utilizes multiple investigators, multiple study sites, 
randomization, large enrollment numbers, statistical power, 
controls, clinical endpoints and other mechanisms that can 
demonstrate the reproducibility underlying FDA's request for 
two or more separate studies for each new drug and/or 
indication. Therefore, it is the committee's understanding that 
independent substantiation is the scientific basis underlying 
FDA's substantial evidence requirements.
    The FDA usually interprets the requirement to demonstrate 
substantial evidence of effectiveness to require two adequate 
and well-controlled clinical studies, but has shown flexibility 
and approved some drugs on the basis of one adequate and well-
controlled clinical study. Given scientific advancement in the 
past 35 years and the promise of further advancement, it is the 
committee's belief that the structure of a particular clinical 
protocol and the quality of the data underlying a new drug 
application should guide FDA's substantiation requirements. 
Therefore, the legislation confirms the current FDA 
interpretation that substantial evidence may, as appropriate, 
when the Secretary determines, based on relevant science, 
consist of data from one adequate and well-controlled clinical 
investigation and confirmatory evidence (obtained either before 
or after the investigation).
    The statutory standard for proof of effectiveness of a 
medical device was purposely chosen in the Medical Device 
Amendments of 1976 to be different from that for new drugs. 
Different language was used for the express purpose of 
emphasizing this difference. As the Cooper Committee emphasized 
in its 1969 report, drugs and devices are different in nature 
and present different issues when considering safety and 
effectiveness. For medical devices, for example, the skill of 
the person using the device is often of paramount importance, 
in contrast with the use of new drugs.
    The committee amended section 513(a)(3)(A) of the Act to 
permit effectiveness to be demonstrated with ``one or more 
well-controlled clinical investigations.'' This requirement 
replaces the one in current law which literally requires more 
than one well-controlled clinical investigation to demonstrate 
a reasonable assurance of device effectiveness. The committee 
changed the law because FDA has typically required only one 
well-controlled clinical investigation to demonstrate device 
effectiveness and it makes little sense to continue a law in a 
manner inconsistent with its interpretation by an expert, 
scientific agency.

                   Title V--Improving Accountability

    The committee recognizes the ongoing effort at FDA to 
improve its performance in meeting the statutory deadlines and 
other responsibilities imposed upon the FDA under the Federal 
Food, Drug and Cosmetic Act. The Prescription Drug User Fee Act 
has assisted the FDA in coming closer to meeting the statutory 
review times established in the Act. The recent efforts by the 
Center for Devices and Radiological Health to reduce the 510(k) 
backlog, more prompt review of Investigational Device 
Exemptions, and the pending Center for Devices and Radiological 
Health (CDRH) re-engineering effort are all promising signs of 
a new attitude and responsiveness at the FDA. Nonetheless, the 
committee remains concerned that there are no effective 
measures available to ensure FDA compliance with statutorily 
required performance goals.
    The legislation requires FDA to develop an agency plan to 
come into compliance with the Act and provide an annual report 
providing detailed information regarding implementation of the 
agency plan, including statistical information which will 
assist the committee in fulfilling its oversight 
responsibilities.
    Notwithstanding the efforts by the agency noted above, the 
committee remains concerned that review times for many products 
are substantially in excess of those required in the FFDCA. 
Further, the agency is in many cases behind in its reporting 
requirements and is incompletely implementing other 
requirements. An example of the latter are the regulations 
promulgated by the Health Care Financing Administration 
following enactment of the Clinical Laboratory Improvement 
Amendments of 1988 (CLIA).
    Under CLIA, the FDA was provided the responsibility to 
categorize the complexity of new in vitro diagnostic (IVD) 
devices. However, the FDA failed to undertake this task and the 
responsibility for regulating the complexity of these IVD 
products was assumed by the Centers for Disease Control and 
Prevention (CDC). At the same time, FDA continues to conduct 
extensive evaluations of these IVD devices before clearing them 
for market under the FDCA, including reviewing their 
instructions for use.
    The committee is concerned that this dual responsibility 
has resulted in a process that causes confusion and unnecessary 
conflict for IVD device manufacturers. In many cases, this 
overlap has delayed the delivery of potentially lifesaving 
devices to market. Additionally, CDC's focus on the same safety 
and effectiveness issues as FDA highlights the wastefulness of 
this duplicative review. Therefore, the committee believes that 
FDA should reassert its exclusive role in the implementation of 
the complexity evaluations under the CLIA regulations.

      Title VI--Better Allocation of Resources Setting Priorities

Minor modifications

    In section 601, the committee addressed changes made in 
investigational devices and modifications of approved PMA 
devices. First, the committee requires the FDA to promulgate a 
regulation modifying its current investigational device 
exemption regulation by including a provision that permits 
developmental changes to investigational devices that are based 
on information learned during an investigation without 
submitting a supplement to an approved investigational device 
exemption application. Specifically, if a study sponsor 
determines, based on credible information, that the change does 
not affect the scientific soundness of the investigational plan 
or patient rights, and the change does not constitute a 
significant design change or a change in basic operating 
principles, then no supplement of original IDE application will 
be necessary. For purposes of this provision, ``credible 
information'' shall mean information upon which a reasonable 
person in a manufacturer's position would rely upon in making a 
decision to change or modify an investigational device.
    The committee also altered section 515 of the Act to 
accommodate this amendment of the FDA's investigational device 
exemption regulations. In addition to permitting the use in 
PMA's of data from devices altered during an investigation, the 
agency will be required to consider data from approved device 
investigations for devices already subject to PMA approvals, 
when the data are relevant to the design and intended use of 
the device subject to the pending PMA. In other words, if PMA 
data for a device are available for use by an applicant, that 
data could be used to approve a newer version of an already 
approved device if other data address any differences between 
the approved device and the one pending before the agency.
    The committee looked at two forms of change to an approved 
PMA device: Manufacturing changes and incremental device design 
changes. In lieu of a supplement for a manufacturing change, 
the bill requires that manufacturers proposing such a change 
provide the FDA a 14-day notice prior to commercial 
distribution of a device manufactured under the changed 
conditions. The notice must provide a detailed description of 
the change, data or information supporting the change, and an 
assertion that the change was made under Good Manufacturing 
Practices (GMP's). The committee believes that the agency's new 
GMP regulation, including its design validation provisions 
which address all changes that could affect device performance, 
provides adequate protection for the public health in lieu of 
supplements to the approved application. This is particularly 
true in light of the fact that the agency approves 
manufacturing facilities as part of PMA product approvals. 
Avoiding delays in implementing manufacturing changes cuts 
costs and typically results in improved products. Importantly, 
with the notice required under this section, FDA could dispatch 
inspectors to review the changes that require attention. 
Moreover, if a change appeared suspect based on the notice, 
administratively FDA could stop shipments of devices made under 
the changed conditions. All in all the purpose of this 
provision is to avoid delay and reduce the use of FDA resources 
on issues that should not merit the agency's attention.
    The committee addressed incremental design changes to 
approved PMA devices that affect safety or effectiveness by 
requiring the FDA to approve a supplement if bench data 
demonstrate that the design modification achieved its purpose 
and clinical data from the approved application and supplements 
thereto demonstrate a reasonable assurance of safety and 
effectiveness for the modified device. However, if the 
Secretary believes that additional clinical data are necessary, 
the Secretary may require such data but only insofar as the 
data relate to the design modification.
    This change reflects the committee's understanding that 
devices develop incrementally, often through very small 
modifications. To avoid over regulation and wasteful 
expenditure of agency review resources, the committee wants the 
Agency to determine when new clinical data are necessary as 
opposed to presuming such data are always necessary.

Environmental impact review

    The National Environmental Policy Act requires that all 
Federal action be subject to environmental consideration. Some 
State laws also require a similar analysis. In only one 
instance, however, has the FDA ever determined that action on 
anew drug application might potentially have a significant 
environmental impact. Even in that instance, the importance of the drug 
involved to human health outweighed the environmental impact and the 
drug was therefore approved. In the meantime, new product sponsors are 
generally required to file environmental assessments with new product 
approval applications, adding substantially to the cost of new product 
development, adding time to the development and approval process, and 
consuming valuable FDA review resources.
    The legislation ends the automatic requirement for filing 
environmental assessments, environmental impact statements, or 
other environmental considerations. New product sponsors would 
be required to conduct such assessments only if the FDA in 
writing and specifying the basis therefore, determines that 
there is a reasonable probability that the environmental impact 
of the action is sufficiently substantial and within the 
factors that the FDA is authorized to consider under the 
Federal Food, Drug, and Cosmetic Act and that consideration of 
that impact will directly affect the decision on the matter. 
This assures that, whenever environmental considerations are in 
fact significant, they will be fully analyzed and taken into 
account and that industry and agency resources will be focused 
on considering issues related to the safety and effectiveness 
of products.

Exemption of certain class devices from premarket notification 
        requirements

    Under the medical device provisions of the law that were 
enacted as part of the Medical Device Amendments of 1976 and 
amended under the Safe Medical Devices Act of 1990, 
approximately 97 percent of all devices were cleared for 
marketing through FDA's premarket notification program. When a 
device is found to be substantially equivalent to a legally 
marketed device, it may be marketed after the FDA issues an 
order making that finding.
    After the enactment of the Safe Medical Devices Act of 
1990, severe backlogs of premarket notifications and premarket 
approval applications developed at the FDA. Recognizing that 
part of the problem was the sheer number of notifications the 
agency was receiving for class I or II products that posed 
little risk, President Clinton announced a reinventing 
government initiative to eliminate the notification requirement 
for some devices posing a minimal risk, and the FDA has now 
acted to exempt a substantial number of such devices. By 
eliminating premarket notification reviews for some low-risk 
devices, agency resources could instead be used on more 
critical devices, including those subject to premarket approval 
applications.
    Building on the President's initiative, the legislation 
exempts all class I devices from premarket notification 
requirements, except those the intended use of which is of 
substantial importance in preventing impairment of human 
health, or presents a potential unreasonable risk of illness or 
injury. In addition, the FDA is required to review all class II 
products to determine those that should and should not be 
exempt from the section 510(k) process. The FDA is provided 30 
days to complete the class II exemption process.
    Because the agency on its own initiative has already had 
this matter under review for several years, and because the 
committee put the agency on notice through multiple requests 
over the last year for a list of any such devices which do not 
require premarket notification to protect the public health, 
this is a reasonable time within which to complete the job.
    Further, at any time, on the Secretary's own initiative or 
in response to the petition of an interested person, the FDA 
may exempt a type of class II device from the section 510(k) 
process. By eliminating low-risk devices from the FDA's 
premarket review responsibility, FDA personnel will be better 
able to handle within statutory deadlines the remaining section 
510(k) notifications and premarket approval applications for 
devices that may pose a risk to public health and safety or 
provide health benefits to patients.

Evaluation of automatic class III designation

    Section 604 includes a process that permits the Secretary 
to classify devices based on the Act's risk-based 
classification criteria when a device is found to be not 
substantially equivalent to a predicate device. Specifically, 
thirty days after receipt of a not substantially equivalent 
determination, the person receiving the Secretary's 
classification order may request that the Secretary make a risk 
based classification determination for the person's device, if 
the type of device hadnot been previously classified. The 
manufacturer should provide information to assist the Secretary in 
making the risk-based classification. The Secretary will then determine 
the device's classification based on the classification definitions in 
section 513(a)(1). These definitions have been used by the Secretary to 
classify or reclassify over a thousand types of devices.
    Within 60 days of the above request, the Secretary must 
make a classification determination, placing the device into 
one of three statutory device classes. If the device is placed 
into classes I or II, it may be commercially distributed 
immediately. Of course, like any device, devices classified 
into class I or II under section 604 will be subject to all 
provisions of the Act. However, if the device is placed in 
class III, its status will remain unchanged from its not 
substantially equivalent designation; that is, the device will 
be classified into class III and will require an approved 
premarket application under section 515 before marketing.
    A device may be placed into class II conditioned upon 
complying with ``special controls.'' Devices placed into class 
II under section 604 must comply with those controls to 
maintain a class II status. A failure to comply with special 
controls will result in the device reverting to its not 
substantially equivalent, class III designation. Marketing of a 
class III device under these circumstances will result in the 
device being adulterated within the meaning of 501(f)(1)(B), 
assuming it has not been distributed under an investigational 
device exemption, because the device will be an unapproved 
class III device classified under section 513(f)(1).
    Once a device is classified into class I or II under 
section 604, it becomes a predicate for future premarket 
notification submissions. Persons who file reports under 
section 510(k) may demonstrate the substantial equivalence of 
newer devices to these predicates. Substantial equivalence may 
be demonstrated by complying with the specified special 
controls used to establish the classification of the predicate 
device and other information, when necessary, or it may be 
demonstrated in another manner. As with current law, the person 
making a premarket notification submission will have the option 
of determining how to demonstrate the substantial equivalence 
of a device to a predicate device, and the agency will have the 
responsibility to make substantial equivalence determinations.
    The committee realizes that ``special controls'' can be 
controls or a variety of controls that will assist in providing 
a reasonable assurance of device safety and effectiveness. When 
conducting a classification review under this section, the 
Secretary may classify a device into class II even when special 
controls to not yet exist. Under these circumstances, the 
Secretary should inform the person seeking a risk based 
classification of the Secretary's intention to rely on a 
special control in the future and specify the nature of the 
special control.
    Importantly, the fact that a device is subject to a special 
control under this section does not mean that enforcement 
authority over in other parts of the Act become ineffective. 
For example, postmarket surveillance and labeling can be 
special controls. Nonetheless, postmarket surveillance is still 
enforceable as a misbranding under section 502(t) and specified 
labeling instructions remain enforceable under either section 
502(a) or 502(f)(1) as misbrandings, depending on the labeling 
control at issue.
    The committee included section 604 to avoid the needless 
expenditure of the Secretary's resources that would occur if 
lower risk devices were subjected to premarket approval reviews 
under section 515 because such devices were unique and found to 
be not substantially equivalent to a predicate device. The 
Committee also believes that section 604 may permit the 
Secretary to avoid time and resources consuming substantial 
equivalence determinations that rely on remote predicates. The 
Committee did not include this section in its bill to increase 
significantly the number of not substantially equivalent 
determinations, and specifically it did not intend that section 
604 would otherwise alter the Act's substantial equivalence 
provisions or the Secretary's longstanding approach to the 
510(k) classification process.
    Concern has been expressed that the Secretary will attempt 
to use this provision as a means of creating mandatory [. . . 
requirements] out of voluntary ones, thus subjecting regulated 
persons to enforcement consequences without process. That is 
not the Committee's intent. For example, once a deviceis 
classified into class II under a risk based assessment, compliance with 
applicable special controls will be unnecessary to demonstrate 
substantial equivalence between a newer device and the section 604 
predicate device, unless the special control is a part of the device's 
intended use. The Committee's intent behind section 604 is simple: 
Section 604 will permit the Secretary to avoid over-regulation of 
devices that should not be subject to premarket approval requirements. 
In other words, the Committee does not intend section 604 to supplant 
or otherwise change the ``510(k) classification process.''

Tracking

    The Safe Medical Devices Act of 1990 added a new provision 
to require device tracking for every device the failure of 
which would be reasonably likely to have serious adverse health 
consequences and which is a permanently implanted device or a 
life-sustaining device that is used outside a device user 
facility, as well as any other device designated by the FDA.
    This statutory mandate has proven to be uncertain with 
regard to which devices require mandatory tracking. The FDA's 
regulation for tracking identifies an illustrative list of 
devices subject to mandatory tracking, suggesting that the list 
is comprehensive, yet not complete.
    To address these problems, the legislation requires FDA to 
affirmatively list those devices which it intends to be subject 
to tracking. Devices not so listed are presumed exempt from 
tracking requirements until such time as FDA chooses to 
affirmatively require tracking. The legislation does not modify 
the existing mandatory or discretionary tracking authority. The 
Committee notes the intent of the tracking provisions in the 
Safe Medical Devices Act of 1990 was to track medical devices 
to facilitate recalls.

Postmarket surveillance

    The Safe Medical Devices Act of 1990 also included a 
provision requiring a manufacturer to conduct postmarket 
surveillance for any device first marketed after January 1, 
1991, that is a permanent implant the failure of which may 
cause serious adverse health consequences or death, is intended 
for use in supporting or sustaining human life, or potentially 
presents a serious risk to human health. In addition to this 
mandatory surveillance, FDA was authorized to require 
postmarket surveillance for any device when the agency 
determined that surveillance is necessary to protect the public 
health or to provide safety or effectiveness data. All 
manufacturers subject to mandatory postmarket surveillance were 
required to submit protocols for FDA approval within 30 days of 
first marketing the device. The FDA was required to determine 
the adequacy of the principal investigator and the protocol and 
to approve the protocol after review by an appropriately 
qualified advisory committee.
    In practice, the provision for mandatory surveillance, like 
the one for mandatory tracking, is so broadly worded that it is 
causing a good deal of uncertainty about those devices which 
are subject to this requirement. Further, the committee is 
concerned that FDA not interpret the postmarket surveillance 
authority as power to require longitudinal studies for FDA 
approved products. The committee legislation repeals mandatory 
surveillance and provides the Secretary with broad discretion 
to implement postmarket surveillance. Under current law, 
required surveillance is limited to devices first introduced 
into commerce after January 1, 1991. Under the legislation, 
subject to the Secretary's discretion, any device may be 
subject to surveillance.
    The legislation sets the initial period of surveillance at 
24 months. After an informal hearing to consider the need for 
further surveillance, FDA may require that the surveillance 
continue for such time as is necessary.
    Since 1976, and reinforced in 1990, the Federal Food, Drug, 
and Cosmetic Act has required medical device reporting by 
distributors as well as manufacturers. The Safe Medical Devices 
Act of 1990 added this requirement for device user facilities. 
As a result, there has been a substantial increase in reporting 
for medical devices, including, as documented by the GAO, much 
duplication and some inaccurate filings. Further, the FDA, 
after request by the committee, has been unable to confirm that 
it either tracks distributor reports or acts on the basis of 
suchreports. To avoid duplication and the costs associated with 
it, the legislation continues to require manufacturers and user 
facilities to report adverse events to the FDA but eliminates 
distributor reporting. Because user facilities and manufacturers submit 
medical device reports to the FDA, there is no need for additional 
reporting by distributors. Further, the registration requirement for 
distributors is deleted. Finally, the record keeping requirements for 
distributors are retained. Because the agency has represented it is 
aggressively pursuing reforms to address the concerns raised in the GAO 
report with respect to user reporting, namely, letting a contract to 
explore a sentinel, statistically significant user reporting system, 
the committee has not proposed a statutory remedy in that area at this 
time.

Pilot and small-scale manufacture

    An important part of applications for new drugs and 
biological products consists of the information on chemistry, 
manufacturing, and controls (CMC). During the investigation of 
a new product, only a relatively small amount of the drug is 
needed to support the preclinical and clinical trials. It is 
only after marketing approval is obtained from the FDA that 
large-scale manufacturing is justified.
    For some drugs, where the evidence of effectiveness is 
overwhelming, companies are prepared to scale up to large 
manufacturing facilities even before FDA approval is obtained. 
For small companies with modest capitalization, however, it is 
common practice to wait for FDA approval of the premarket 
approval application before scaling up to larger processes. 
This is particularly characteristic of startup biotechnology 
companies.
    In the past, the FDA has for some drugs required CMC data 
relating to large-scale manufacture before approval will be 
granted. This penalizes small companies and especially the 
biotechnology industry. The legislation therefore states the 
general rule that the FDA review and approve new drugs and 
biological products on the basis of pilot and small-scale 
manufacturing, and permit the company to scale up to a larger 
facility after the product has been approved. Scaling up can 
readily be undertaken on the basis of process validation, 
without additional clinical trials. Only in the very rare case 
where full-scale production is necessary to ensure the safety 
or effectiveness of the new drug or biological product prior to 
approval is the FDA given the authority to require such 
manufacture as a condition of approval. This is the approach 
that has been announced in the Reinventing Government 
initiative relating to drug and medical device regulations. The 
need for supplemental approval of the manufacturing changes 
needed to scale up to larger facilities is subject to the new 
requirements in section 614 of the legislation.

Requirements for radiopharmaceuticals

    The purpose of section 610 is to acknowledge the special 
characteristics of radiopharmaceuticals used for diagnostic and 
monitoring purposes that should be taken into account in 
evaluating their safety and efficacy. Radiopharmaceutical 
diagnostic and imaging agents are not normally used 
chronically. They are administered on an occasional and 
intermittent basis. Because of the contribution of the 
radioactive isotope, only small quantities of the carrier or 
ligand drug are needed to produce the desired effect. Section 
609 recognizes that the determination of the safety and 
effectiveness of such a radiopharmaceutical diagnostic or 
monitoring agent should include consideration of these unique 
characteristics and directs the FDA to develop regulations 
governing the approval of radiopharmaceuticals used for 
diagnostic and monitoring purposes. The provision states that 
the determination of safety and effectiveness should include 
consideration of the proposed use of the radiopharmaceutical in 
the practice of medicine, the pharmacological and toxicological 
activity of the radiopharmaceutical (including any carrier or 
ligand component), and the estimated absorbed radiation dose of 
the radiopharmaceutical. However, this provision is not 
intended to change the standards, or limit the data 
requirements, under section 505 of the Federal Food, Drug and 
Cosmetic Act or section 351 of the Public Health Service Act, 
by which the safety and effectiveness of such 
radiopharmaceuticals are determined.
    In addition, section 610 acknowledges that the indications 
for which radiopharmaceuticals are used may, in appropriate 
cases, refer to manifestations of disease (such as biochemical, 
physiological, anatomic, or pathological processes) common to 
or present in 1 or more disease states. This refers to the 
factthat radiopharmaceutical diagnostic and monitoring agents may, 
under appropriate circumstances, be approved for use on the basis of 
their effectiveness in showing how a disease or process has developed, 
is developing, or is progressing.
    This section is limited to radiopharmaceuticals used for 
diagnosis and monitoring and does not address 
radiopharmaceuticals used for therapeutic purposes. Thus, 
radiopharmaceutical is defined for purposes of this section 
only as (1) an article (A) that is intended for use in the 
diagnosis or monitoring of a disease or a manifestation of a 
disease in humans; and (B) which exhibits spontaneous 
disintegration of unstable nuclei with the emission of nuclear 
particles or photons; or (2) any nonradioactive reagent kit or 
nuclide generator which is intended to be used in the 
preparation of any such article.

Modernization of regulation of biological products

    The provisions of section 351 of the Public Health Service 
Act that govern the FDA regulation of biological products were 
initially enacted by Congress in 1902 and were recodified in 
1944. Responsibility for implementing these provisions was 
initially in other parts of the Public Health Service until it 
was transferred to the FDA in 1972. The basic concept of the 
statutory requirements has not been revised in more than 90 
years.
    When FDA assumed responsibility for regulating biological 
products in 1972, it made two important policy decisions. 
First, it retained a separate organizational structure and 
regulatory focus for biological products, rather than combining 
these products with new drugs. (Even when the two 
organizational structures were temporarily combined in the 
1980's, a separate regulatory focus was maintained). Second, 
because biological products are also drugs, more recent 
regulatory concepts that were applied to new drugs, (e.g., 
compliance with drug GMP regulations) were incorporated into 
the older system for biological products. In the past 25 years, 
the two regulatory systems have become similar, although each 
retains its separate identify.
    The legislation takes this logical progression one step 
further. It substantially revises section 351 of the Public 
Health Service Act to make it much closer to the current 
approach for approval of new drugs. The most important revision 
repeals existing requirements for a facilities license. Since 
1902, the law has been interpreted to require that the 
applicant for a new biological product ordinarily obtain both a 
product license and an establishment license. In contrast, the 
applicant for approval of anew drug is required to submit only 
a single application, which covers both the product and the 
manufacturing processes in the establishment. The legislation 
adopts the same approach for pioneer biological products as for 
new drugs. Thus, the current statutory requirement for licenses 
for biological products is clarified to require only one 
license--covering both the product and the facility in which 
the product is manufactured.
    To ensure consistency in regulation of new drugs and 
biological products, the bill requires the FDA to take measures 
to minimize the differences in review and approval of products 
required to have biologics license applications under the 
revised section 351 of the Public Health Service Act and full 
new drug applications under section 505(b)(1) of the FFDCA. 
This requirement for harmonization does not apply in the case 
of generic products, however, since the authority for 
abbreviated new drug applications under section 505(j) is not 
applicable to biological products.
    The FDA is required to establish, by regulations, the 
requirements that an applicant must meet in order to obtain 
approval of a biological product license application. The 
biological product must be demonstrated to be ``safe, pure and 
potent''. Potent is intended to mean ``effectiveness'' as FDA 
has historically interpreted the term. The applicant must also 
demonstrate compliance with GMP requirements. Preapproval 
inspection for compliance with GMP is included.
    Among the most important biological products subject to FDA 
regulation are blood and products derived from blood. There are 
two basic categories of these products: (1) blood and blood 
components, and (2) products that are derived from blood and 
blood components. For currently licensed blood and its 
components, the FDA has established appropriate standards 
designed to assure safety, purity, and potency. The 
legislationis not intended to change FDA's ability to approve blood and 
its components that meet these standards. Blood and its components must 
also be obtained, held, processed, and utilized in accordance with GMP 
regulations. The safety determination for blood, blood components, and 
blood derivative products, as for other biological products, includes 
assessment of benefits and risks. There is always some degree of risk 
associated with blood and products made from blood.
    Establishments that collect, process, and use blood and its 
components are uniquely located at the local community level. 
There are more than a thousand of these blood establishments, 
located throughout the country, in contrast with the usual 
situation with other pharmaceutical establishments. The 
committee intends that regulatory requirements be streamlined 
and made efficient. For example, a single license application 
could cover all facilities under one management to utilize 
particular types of products or methods of processing when the 
application makes clear that all facilities and products meet 
applicable requirements and standards for their use. Requiring 
separate license applications for each separate facility and 
product can be wasteful of both industry and government 
resources and achieves no useful public health purpose.
    It is important that, when a problem is found at a 
particular facility, the FDA has adequate power to revoke 
whatever licenses are applicable with respect to that specific 
location. If ten facilities are under one management and the 
FDA discovers that two fail to meet GMP requirements, or two 
are not properly using products or processes for which all of 
the facilities are licensed, FDA may suspend and revoke the 
applicable license with respect to those two facilities and 
their products.
    Even before the FDA was delegated responsibility for the 
regulation of biological products, the FDA regulations 
governing investigational new drugs were used as the applicable 
requirements for the investigation of biological products as 
well. This practice is not changed under the legislation.
    To simplify the statutory language, the legislation 
incorporates a definition of ``biological product'' to 
encompass all of the products that are presently included 
within the Public Health Service Act provisions governing this 
category of products. That defined term is then used throughout 
the new provision as well as in sections of the Food, Drug, and 
Cosmetic Act that apply to both biological products and non-
biological new drugs.

Supplemental new drug applications

    A new use of an approved drug can be added to the product 
label if the sponsor files a supplemental new drug application 
with FDA and FDA approves that application. Although the review 
times for these supplemental applications have improved over 
the past few years (in part due to the Prescription Drug User 
Fee Act of 1992), there are still many drug labels that do not 
reflect up-to-date information on new uses for approved 
products. Without adequate information about new uses on the 
drug label, there are risks of unsafe or inappropriate uses.
    In an ideal world, common medical practice should be 
reflected on the FDA approved label for the product. In 
addition, the process for updating the label for an approved 
product should be sufficiently expeditious to justify the time 
and expense associated with the conduct of new clinical trials 
and submission of a supplemental approval application. In fact, 
however, there are many reasons why supplemental applications 
are not submitted, including:
          Excessively high costs of a supplemental NDA 
        (including the necessary clinical work) relative to the 
        market for the new use, indication, or dosage;
          Delays in the approval of supplements, which are 
        currently running at one year from submission (as a 
        median and a mean); and,
          Patent or market exclusivity may expire.
    In many cases products are prescribed for use, indications, 
or in doses that are not within the label approved by the FDA. 
In fact, many older, off-patent drugs are prescribed in this 
manner. According to the US General Accounting Office, one-
third of all cancer drugs are used for uses other than that for 
which they were approved, 44 of 46 approved cancer drugs are 
used forat least one additional, non-approved use, and 56% of 
all cancer patients use at least one drug prescribed for a use other 
than that for which they were approved. This type of prescribing is 
also common with AIDS drugs--78% of all AIDS patients receive a drug in 
this manner. Overall, 80% of all prescription drugs are prescribed in a 
manner which differs in some respect from the approved labeling.
    The legislation takes steps toward addressing this problem 
in several ways. First, it directs FDA to establish performance 
standards for the review of supplemental applications for 
approved products.
    Second, FDA must issue final guidance documents that 
clarify the requirements for, and facilitate the submission of, 
data to support approval of such supplemental requirements. The 
guidance will clarify the circumstance in which published 
studies may be the basis for approval, specify data 
requirements that will avoid duplication of previously 
submitted data, and define supplemental applications that are 
eligible for priority review. FDA has already issued draft 
guidance documents that address most of these issues.
    Third, the legislation requires FDA to designate an 
individual in each center (except the Center for Food Safety 
and Applied Nutrition) who will have responsibility for 
encouraging prompt review of supplemental applications and 
working with sponsors to facilitate the development and 
submission of data to support such supplemental applications.
    Finally, FDA is directed to implement programs and policies 
to foster collaboration between FDA, the National Institutes of 
Health and others to identify published and unpublished studies 
to support supplemental applications and to encourage sponsors 
to make applications or conduct further research in support of 
an application based on such studies.

Health care economic information

    The committee believes that the FDA should allow companies 
to share health economic information about approved ``on 
label'' uses for products under the same standard applied to 
over-the-counter drugs and other products. The agency currently 
requires these claims--which differ from efficacy claims--to be 
subjected to two clinical trials. The agency on several 
occasions conceded that this standard is inappropriate for such 
claims and agreed that it should be modified to a more 
appropriate standard.
    Health economic information about approved ``on label'' 
uses is needed by managed care experts and other health care 
providers responsible for evaluating the benefits, other 
consequences, and costs of competing therapies. Health care 
providers also rely on companies to conduct studies in the 
providers' own or comparable representative populations to help 
the providers predict the specific benefits and costs of FDA-
approved products for their particular organizations. Companies 
typically have the best and most comprehensive information 
about the cost, effectiveness, and safety of their products. 
The FDA should not unduly impede the flow of that information 
to experts who need it for patient and health plan decisions. 
Undue restrictions on the ability of companies to make 
competent and reliable claims on the basis of cost, 
effectiveness, or safety of approved uses of products interfere 
with the public health by encouraging the sale and use of 
needlessly expensive products.
    This provision differentiates between clinical claims and 
economic claims. Clinical claims would continue to be governed 
by the evidence standard in the Act. Economic claims would be 
governed by the ``competent and reliable scientific evidence 
standard used by the Federal Trade Commission, drawing from 
available evidence in the relevant economic fields of science. 
Economic claims could only be distributed to drug formulary 
committees, managed care entities, or similar entities with 
responsibility for drug selection decisions. Economic claims 
are defined as those that identify, measure, or compare the 
costs (direct, indirect, or intangible) and health care 
consequences of a drug to another drug or to another health 
care intervention for the same indication, or to no 
intervention, where the primary endpoint is an economic outcome 
of the research or analysis on which the statement is based.

Expediting approval and of fast-track drugs

    The FDA currently has a number of mechanisms aimed 
atstreamlining the development and approval process for new therapies 
for serious and life-threatening conditions. The committee believes 
that a formal statutory mechanism for identifying breakthrough drugs 
early in product development that provides sponsors of such drugs a 
reasonable opportunity for early interaction with the agency may help 
to further streamline the development and approval processes for such 
drugs.
    This legislation is intended to clarify and coordinate some 
of FDA's mechanisms for new drugs and biological products that 
are intended for the treatment of serious and life threatening 
conditions and that demonstrate the potential to address unmet 
medical needs for such conditions. It defines and clarifies the 
processes pursuant to which sponsors of these drugs may 
interact with the FDA and includes provisions that will ensure 
that these processes are well known and well understood.
    Pursuant to the legislation, drugs for serious and life 
threatening conditions that demonstrate the potential to 
address unmet medical needs will be eligible for a ``fast 
track'' designation. Sponsors may seek fast track designation 
concurrently with (or after) the submission of an application 
for the investigation of the drug. If the FDA determines that 
the drug should be designated as fast track, it will take 
appropriate action to expedite the development and review of 
the drug. For example, if preliminary evaluation of clinical 
efficacy data show evidence of effectiveness, FDA will evaluate 
for filing incomplete portions of the application and if the 
portion is filed, FDA may commence review of that portion. A 
sponsor will be eligible for this ``rolling review,'' however, 
only if it has provided a schedule for submission of 
information necessary to make the application complete and any 
fee required under the Prescription Drug User Free Act.
    The FDA may approve an application for approval of a fast 
track drug under section 505(b) or under section 351(a) of the 
Public Health Service Act upon a determination that the drug 
has an effect on a surrogate endpoint that is reasonably likely 
to predict clinical benefit. This provision is not intended to 
change the standards under section 505 or section 351 of the 
Public Health Service Act, pursuant to which the safety and 
effectiveness of such drugs are determined. All fast track 
drugs must meet the evidentiary standards in section 505(d) or 
section 351(a) of the Public Health Service Act. Moreover, the 
Secretary may require the sponsor to conduct a post-approval 
study to validate the surrogate endpoint or otherwise confirm 
the clinical benefit of the drug. The Secretary also may 
require the sponsor to submit promotional materials during the 
pre-approval review period and following approval. The 
Secretary may withdraw approval of a fast track drug using 
expedited procedures if the sponsor fails to conduct required 
postmarketing studies, the post-approval study fails to verify 
clinical benefit, other evidence demonstrates that the drug is 
not safe or effective, or the sponsor disseminates promotional 
materials that are false or misleading. These expedite 
procedures include an opportunity for an informal hearing, as 
currently provided in FDA's accelerated approval regulation, 
rather than for a formal evidentiary hearing as provided in 
certain other circumstances.
    In cases where there exists a surrogate endpoint which can 
be measured more rapidly than clinical endpoints and where a 
drug's effect on that surrogate endpoint is reasonably likely 
to predict clinical benefit, the acceptance of effects on 
surrogate endpoints as evidence of efficacy can lead to more 
rapid availability of safe and effective drugs for Americans 
with serious or life threatening illnesses. In order to reap 
that benefit, it is essential that potentially useful surrogate 
endpoints be identified and evaluated for their likelihood of 
predicting clinical benefit. To that end, it is the intent of 
Congress that the FDA participate with other public health 
agencies, patient groups, industry, academic, and medical 
groups and other interested parties in efforts to improve the 
utilization of surrogate endpoints. The committee is not 
directing the FDA to develop such surrogate endpoints, but 
rather is directing the agency to support the efforts of others 
to develop and validate surrogate endpoints.
    This provision is not intended to modify any agreement 
reached under the Prescription Drug User Fee Act. The review 
periods agreed to under PDUFA will not begin to run until a 
complete application for a fast-track drug has been submitted 
to the agency.
    To ensure that the processes and policies set forth in the 
fast-track provision are well known and well understood, this 
provision directs the Secretary to provide physicians, 
patientorganizations, industry, and other appropriate persons a 
comprehensive description of the fast track provisions established 
under this legislation and within 1 year to issue guidance that 
describes the policies and procedures pertaining to fast-track drugs.
    Finally, the committee recognizes that his opportunity for 
drugs to be approved on an urgent basis with what may be fewer 
data than are customary may require increasing reliance on 
post-approval studies to gather confirmatory or additional 
information. The committee urges the industry to cooperate 
fully in the gathering of such post-approval studies in order 
to assure that drugs approved on a fast track are, indeed, safe 
and effective and to assure that patients and their providers 
are given information about the appropriate use of these drugs.

Manufacturing changes

    The manufacturing processes and facilities used to produce 
a new drug or biological product undergo changes throughout the 
investigation of the product and after marketing approval is 
obtained from the FDA. Innovations are sought to reduce 
impurities, increase yield, reduce the complexity and time 
required for manufacture, eliminate equipment, automate 
procedures, increase stability, and otherwise to improve the 
drug and reduce its cost. The benefits of these innovations are 
passed on to the consumer in the form of improved products and 
lower prices.
    In the past, the FDA has imposed very stringent limitations 
on the ability of the pharmaceutical and biotechnology 
industries to adopt new manufacturing procedures. For most 
manufacturing changes, FDA approval of the supplemental 
application is required. For only a few has the FDA permitted 
the change to be made immediately and simply reported to the 
FDA by a simultaneous supplement or in the annual report 
submitted to the FDA for the drug. For biological products, FDA 
has been even more stringent, requiring clinical trials to 
support new manufacturing processes in many situations. 
Supplemental applications for manufacturing changes have, 
moreover, traditionally been given a very low priority within 
the FDA. As a result, it can be years before a new 
manufacturing process can be used, even if it results in a 
substantial improvement in the drug.
    The impact of past FDA policy in this area on the 
pharmaceutical and biotechnology industries has been 
substantial. First, many companies have established 
manufacturing facilities abroad, where they can use a modern 
process to supply a drug to the rest of the world long before 
they can use the same process to supply the United States. 
Second, some companies do not make important drug manufacturing 
improvements because of the cost and lengthy process required 
for approval. The development of new technology, the public 
health and pocketbook have all suffered.
    To address these problems, the legislation considered by 
the committee included a new approach to manufacturing changes 
for new drugs and biological products. Current law governing 
manufacturing changes shall remain in effect until 24 months of 
the date of enactment of this legislation or the effective date 
of regulations promulgated by the FDA implementing the new 
policy, whichever is sooner. The policy focuses on the 
specifications of the drug or biological product found in the 
license application and sorts manufacturing changes into three 
categories. Major manufacturing changes, which are of a type 
determined by the FDA to have a substantial potential to 
adversely affect the identity, strength, quality, purity, and 
potency of a drug, as those characteristics relate to safety 
and efficacy, shall require prior approval of a supplemental 
application. The FDA will identify other types of manufacturing 
changes which can be made at will with only a requirement to 
note the change in an annual report to the FDA. Other changes 
may be made, if FDA has not notified the company within 30 days 
after the submission of a supplement that a prior approval is 
required. FDA shall also designate changes for which 
distribution of the products may begin at the time the 
supplement is submitted. All supplements will continue to be 
approved or disapproved. If FDA later determines that the 
supplemental NDA is not immediately approvable, the agency will 
work with the applicant to resolve all issues and to assure the 
continued availability of the drug.

Food contact substances

    This provisions adds to the FFDCA a premarket notification 
system that is intended to be the primary method by which FDA 
regulates food contact substances. The food additive petition 
process in its present form will continue to exist in the law, 
but will be invoked for food contact substances only in 
thosecases where FDA determines that a petition is necessary to provide 
adequate assurance of safety or where a company and FDA agree that a 
petition may be submitted.
    In creating the PMN system, this bill leaves in full force 
and effect the current food additive regulations covering food 
contact substances. It is not the intent of this legislation to 
require PMNs for materials that FDA already has received and 
found to be safe for their intended use.
    This legislation also maintains the existing definition of 
``food additive'' in Section 201(s) of the FFDCA (21 U.S.C. 
321(s)). Therefore, a PMN will be required only for a food 
contact substance that is a ``food additive'' within the 
meaning of section 201(s). Similarly, a food contact substances 
that is a food additive but is not the subject of either a food 
additive regulation or an effective notification would be in 
violation of the food adulteration provision in section 
401(a)(2)(C) of the FFDCA. Although the notification is 
effective for the purchaser of the substance manufactured by 
the notifier, the notification is not effective for other 
manufacturers of the same substance.
    The legislation creates a premarket notification (PMN) 
system for clearance by the FDA of substances to be used in 
contact with food (i.e., food contact substances). Food contact 
substances include a variety of materials (e.g., plastics and 
paper), and their components, that are used to package, 
transport, hold, and manufacture food, which substances come in 
contact with food but are not intended to affect the food. 
Under the PMN system, any manufacturer or supplier may file 
with FDA a notification providing complete information 
supporting the safe use of a food contact substance. The 
notifying party may lawfully market and use the food contact 
substance 120 days after the date such a filing is received, 
unless FDA determines that the notifier has not provided 
information showing that the substance is safe, and informs the 
notifier of this determination and the basis for such 
determination.
    The legislation provides an alternate system for the 
clearance of food contact substances that, in most cases, will 
replace for such substances the current food additive petition 
process established under the Food Additives Amendment of 1958. 
The legislation expressly provides that the petition process 
will remain available for certain food contact substances. 
Section 617 will encourage and expedite the development and 
introduction of new food contact substances and new uses of 
existing substances without sacrificing the protection afforded 
consumers against unsafe substances in the food supply.
    The need for this legislation arises from the fact that the 
Food Additives Amendment of 1958 requires FDA to regulate two 
different types of products in the same way, without due regard 
for their different public health and safety implications. 
These two categories of products are ``direct food additives,'' 
which are intended to have a specific technical effect in the 
food and are intended to be ingested as part of the food 
supply, and ``food contact substances'' (often described as 
``indirect food additives'' under the current regulatory 
system), which are intended to contact food but are not 
intended to have a technical effect in the food and whose 
ingestion is incidental to their use.
    Under the Food Additives Amendment of 1958, both categories 
of substances are subject to the same regulatory procedures and 
requirements in that both must go through the full food 
additive petition process. Furthermore, (with the exception of 
substances regulated under 21 CFR Sec. 170.39), lawful use of 
either a direct food additive or a food contact substance 
requires, following FDA safety review, publication of a 
regulation in the Federal Register specifying the conditions 
under which the substance can be safely used.
    FDA regulation of these two different classes of products 
in the same way results in a significant expenditure of 
resources by the agency and by the industry on the premarket 
clearance of food contact substances that in many cases is out 
of proportion to any resulting increase in public health 
protection. Petitions for regulation of food contact substances 
outnumber those for direct additives by a substantial margin. 
At present, FDA does not have the resources to complete the 
review of all food additive petitions for food contact 
substances within the current statutory time frame of 180 days 
and also carry out its other important public health 
responsibilities, including review of direct additives.
    The committee is aware that reports indicate that the many 
companies in the United States which now market globally are 
experiencing even more severe delays in securing product 
clearances in those parts of the world that are adopted 
regulatory approaches for food contact materials similar to 
that used here since 1958. Adoption of the PMN concept may 
provide a useful model for changes in the rest of the world and 
could, thereby, advance the goal of international harmonization 
of regulatory systems.
    Most food contact substances pose relatively little 
potential risk to consumers because their use results in only 
very low potential exposure to the substances in the diet. 
Indeed, the Agency in recent years has implemented initiatives 
to expedite and review of low-risk food contact substances. 
These initiatives include implementation of a Threshold of 
Regulation (TOR) rule, under which FDA has exempted from the 
need for a food additive regulation food additives that are 
used at a level that results in a dietary concentration below 
the threshold set in the rule. The TOR approach to regulating 
food additives is a thoroughly developed public policy, which 
has been widely and publicly debated.
    The premarket notification program builds upon FDA's almost 
40 years of experience in reviewing and regulating food contact 
substances, and upon its more recent experience with the TOR 
approach to the review of low-risk additives. Such a program 
will continue to ensure the safe use of these additives, 
without requiring agency premarket review of food additive 
petitions and publication of orders in the Federal Register. 
Because of considerations such as level of consumption or 
potential toxicity, the committee recognizes that some uses of 
food contact substances may require premarket review and 
approval under Sec. 409 in order to ensure their safe use. The 
legislation is thus drafted to permit the agency to exclude 
those uses of food contact substances from eligibility for 
premarket notification, based on its experience with the safety 
review of these food additives. A premarket notification system 
for food contact substances would improve allocation of scarce 
agency resources by allowing the agency to reduce the resources 
spent on reviewing low-risk food additives, including most food 
contact substances. This more efficient use of resources will 
allow the Agency to focus on premaket review of those additives 
with the greatest potential for risk to consumers.
    A PMN is intended to be specific to the manufacturer or 
supplier that files it and the particular product that is the 
subject of the notification. This approach differs from food 
additive regulations, which are generic regulations that permit 
anyone, not just the petitioner, to manufacture the food 
additive (subject to any patent restrictions). For the 
regulated industry, there will still be costs associated with 
preparing and filing a PMN that provides much of the same 
information currently required for a food additive petition. 
However, because of the shorter turnaround time, increased 
predictability, and proprietary nature of the PMN, these costs 
will be recouped much more quickly.
    FDA also will benefit from the PMN system. The demands on 
the agency's resources to address food contact substances will 
be brought into line with the low potential risk associated 
with most of these products. As a result, the PMN system for 
food contact substances should free resources for dedication to 
more pressing issues.
    FDA also is likely to receive more information on the use 
of all food contact substances in the American food supply 
since more manufacturers and suppliers are likely to submit 
PMN's than currently submit food additive petitions. In 
addition, the increased predictability will increase the 
incentive for companies to make FDA aware of new uses of food 
contact substances. As a result, the agency should have an 
improved data base to assess total exposure to food contact 
materials. These additional data will ultimately benefit the 
public health by providing FDA with more information on the 
identity and levels of food contact substances in use. FDA will 
then be able to more effectively monitor these substances and 
respond to any public health problems that may arise.

Health claims of food products

    This legislation makes amendments to section 403(r) of the 
Federal Food, Drug, and Cosmetic Act to authorize truthful, 
nonmisleading health claims that are based on the published 
authoritative statements of scientific bodies of the U.S. 
Government with official responsibility for public health 
protection or research directly relating to human nutrition.
    It has been the concern of the Congress from the start of 
the nutrition labeling reform process begun nearly a decade ago 
that health claims be authorized when they are supported by 
appropriate scientific evidence and are stated in a truthful, 
nonmisleading manner. Such claims serve the public health by 
helping to disseminate important health information to the 
public promptly, and at the point of purchase where they can 
help shape healthful consumer food choices.
    Under existing section 403(r)(3), health claims can be made 
for food only after FDA issues a regulation authorizing the 
specific claim. This same preclearance requirement applies to 
all health claims--from the novel claim, to the claim that 
would be supported by the authoritative statement of an 
official public health agency of the Federal Government. This 
procedure is inefficient and fails adequately to benefit from 
the deliberative processes in which authoritative scientific 
bodies engage in issuing statements on matters of public 
health. Important Federal public health organizations, as part 
of their official responsibilities, routinely review the 
scientific evidence pertinent to diet and disease 
relationships, and publish statements developed through such 
reviews. The Surgeon General and National Academy of Sciences 
have published authoritative reports on such relationships. The 
National Cancer Institute has issued pamphlets recommending 
food choices to reduce the risk of cancer. The National Heart, 
Lung, and Blood Institute has issued a range of authoritative 
publications aimed at reducing the risk of hypertension and 
heart disease in the United States population.
    The failure of the current system to give adequate weight 
to the statements of such authoritative bodies, coupled with 
the prohibitive economic burden that permits only the largest 
food companies and trade organizations to file a health claim 
petition to gain approval of a new health claim, has deprived 
the public of the full disease prevention benefits health 
claims were intended to provide.
    This legislation maintains the rigorous scientific standard 
health claims must meet under existing law but streamlines the 
procedure for making health claims when the scientific basis 
fora claim has been developed by an authoritative scientific 
body outside FDA. This procedure targets regulatory resources more 
effectively, and promises to benefit public health substantially more 
than the current system.
    The history of the folic acid and neural tube defects 
health claim dramatizes the critical need for this legislation. 
In 1992, the Centers for Disease Control and Prevention (CDC) 
issued the following recommendation to women of childbearing 
age, aimed at reducing the risk of pregnancies affected by 
neural tube birth defects:

          All women of childbearing age in the United States 
        who are capable of becoming pregnant should consume 0.4 
        mg of folic acid per day for the purpose of reducing 
        their risk of having a pregnancy affected with spina 
        bifida or [other neural tube defects].

Centers for Disease Control, 41 Morbidity and Mortality Weekly 
Report (September 11, 1992). The CDC estimated that this 
recommendation could reduce the number of cases of spina bifida 
and other neural tube defects in the United States by 50 
percent.
    Despite the significant scientific agreement among 
qualified experts concerning the evidence supporting the 
recommendation, manufacturers of foods containing folic acid 
were prohibited from making claims about the benefit of folic 
acid in reducing the risk of neural tube defects until FDA 
approved the claim through a notice and comment rulemaking 
procedure.
    Without appropriately accounting for the CDC 
recommendation, FDA promulgated a rule in January 1993, 
prohibiting claims concerning the relationship. In the wake of 
controversy concerning FDA's action, and despite the absence of 
any change in the scientific evidence, the Agency reversed 
course, proposing to authorize such claims in October, 1993. 
Final regulations authorizing the claim were promulgated in 
March 1996. Undoubtedly, many children suffered from 
preventable neural tube defects as a result of FDA's delay in 
authorizing health claims based on the 1992 CDC recommendation.
    The amendments this legislation makes to section 403(r)(3) 
of the Federal Food Drug and Cosmetic Act would prevent a 
recurrence of the kind of problem presented by the folic acid/
neural tube defect claim. While the legislation makes no change 
to the existing standards governing the health claim approval 
process, it establishes an alternative procedure by which 
health claims supported by an authoritative statement of an 
appropriate scientific body of the U.S. Government are 
authorized. Such claims could be made after premarket 
notification to FDA, without the delay that accompanies the 
rulemaking process. The legislation would require manufacturers 
intending to make such a health claim to submit a premarket 
notice to FDA concisely describing the claim and the 
authoritative statement relied upon. The notice would be 
submitted at least 120 days before the first introduction of a 
food bearing the claim into interstate commerce.
    Although the legislation would eliminate the requirement 
for FDA approval of such claims, it would continue to require 
foods to conform to the ``disqualifying nutrient levels'' 
established by FDA under section 403(r)(3)(A)(ii) and require 
all health claims to be presented in a truthful, nonmisleading 
manner in conformance with sections 403(a) and 201(n) of the 
Federal Food Drug and Cosmetic Act. For example, a food bearing 
a truthful health claim based on an authoritative statement 
would need to make a material dietary contribution of the 
substance to which the claim refers to meet the requirements of 
sections 403(a) and 201(n). The legislation specifically 
mandates that a health claim accurately represent the 
authoritative statement on which it is based, and be presented 
in a manner enabling the public to comprehend the significance 
of the claim in the context of a total diet.
    The agency retains full authority to take enforcement 
action against a health claim that mischaracterizes the 
authoritative statement upon which it is based, or that is 
otherwise misleading. The 120 day premarket notice requirement 
would enable FDA to identify misleading claims and take action 
to prevent their use before products bearing such claims are 
introduced to the market. In response to notifications filed by 
dietary supplement manufacturers concerning claims made under 
section 403(r)(6) of the Act, a provision adopted as part of 
the Dietary Supplement Health and Education Act of 1994, FDA 
issues ``courtesy letters'' promptly alerting manufacturers 
when claims submitted in their notification present a risk of 
enforcementaction. Such an approach is an efficient and 
effective means of deterring manufacturers from making violative 
claims.
    Under this legislation, the agency retains the full range 
of enforcement powers it has possessed historically to remedy 
misleading claims, including the powers of product seizure, 
injunction, and criminal penalties. In addition, new section 
403(r)(3)(D) assures that FDA retains full authority to 
regulate health claims based on the statements of authoritative 
bodies through rulemaking. Once FDA regulations governing 
health claims concerning a particular diet/disease relationship 
(e.g., calcium and osteoporosis) have become effective, no 
claim concerning that diet/disease relationship based on the 
statement of an authoritative scientific body could be made 
unless it is consistent with the FDA regulation. The 
legislation specifically provides that FDA may prohibit or 
modify such health claims through rulemaking. In any such 
proceeding, the standards and criteria for health claims 
prescribed in section 403(r)(3) and implementing regulations, 
including the significance scientific agreement standard, would 
be fully applicable.

Pediatric studies of drugs

    When it comes to pharmaceuticals, our Nation's children are 
``therapeutic orphans.'' Currently, less than 20 percent of the 
prescription medications on the United States market are 
approved for use in the pediatric population and labeled for 
pediatric use. Pediatricians using drugs developed with adults 
in mind but which may also be effective or be the only option 
for treating the same illnesses and diseases in children must 
estimate dosages from dosages found to be safe and effective in 
adults. Such estimates are uncertain because children, and 
particularly those under 2 years of age, often metabolize drugs 
differently than do adults. Further, some drugs have different 
side effects and/or toxicities in children than in adults even 
when appropriate doses are used.
    For these reasons, pediatricians have long had an active 
interest in promoting clinical studies of drugs in pediatric 
populations so that the drugs may be labeled for pediatric use. 
However, there is little incentive for drug sponsors to perform 
studies for medications which they intend to market primarily 
for adults and whose use in children is expected to generate 
little additional revenue. Pediatric studies pose ethical and 
moral issues relating to using new unapproved drugs in young 
patients. Second, there are substantial product liability and 
medical malpractice issues. Third, pediatric patients are more 
difficult to attract into studies. Fourth, for some drugs, 
pediatric use represents more difficult issues of drug 
administration and patient compliance than adult use.
    The FDA has sought to address this problem by using its 
authority to approve labeling based upon the known 
pharmacokinetics of the drug, as opposed to requiring pediatric 
clinical trials for efficacy. The FDA has also issued 
regulations that embody this policy in an attempt to encourage 
pediatric labeling. These are clearly steps in the right 
direction, and the committee commends the FDA's initiatives in 
this area.
    The legislation takes a modest further step toward a better 
resolution of this problem by providing an additional 6 months 
of market exclusivity when a drug manufacturer, at the request 
of the FDA, conducts pediatric studies to support pediatric 
labeling for a drug, either before the new drug approval 
application is submitted or later.

Positron emission tomography

    The committee intends in section 619 to provide a new 
framework for the regulation of radiotracers used in positron 
emission tomography (PET) scans based on standards set by the 
United States Pharmacopoeia (USP) and enforced by the FDA and 
state boards of pharmacy and medicine.
    The committee intends to require that PET radiotracers meet 
the standards set by the USP for safety, efficacy and 
compounding, and that the FDA or state agencies will enforce 
the standards set by the USP. The Committee does not intend 
that the FDA set its own standards for compounding of PET 
drugs. Makers and users of PET radiotracers will continue to be 
subject to the requirements of the various state boards of 
medicine and pharmacy which they are currently required to 
meet.
    USP standards are recognized in the FFDCA in the 
adulteration and misbranding sections of the Act (Secs. 
501(b)and 502 respectively). USP establishes standards for all marketed 
drugs in the U.S. It first provided standards for PET pharmaceuticals 
in 1988. During these years, USP standards have served to standardize 
and help assure the quality of these items and protect the public 
health. USP establishes standards for drugs through a rigorous peer 
reviewed process, and the FDA provides input and comment to USP as part 
of this process.
    Section 619(a) amends the FFDCA to add a definition of a 
``compounded positron emission tomography drug'' to mean a PET 
drug (and associated software and hardware) which has been 
compounded in accordance with State law by or on the order of a 
practitioner licensed in that State or in a Federal facility in 
accordance with the law of the State in which it is located.
    Section 619(b) amends the FFDCA to provide that a 
compounded PET drug is adulterated, and thus subject to 
regulatory and/or legal action by FDA, if it is compounded, 
processed, packed, or held other than in accordance with the 
PET compounding standards and the official monographs of the 
USP.
    Section 619(c) amends the FFDCA to provide that neither a 
New Drug Application (NDA) nor an Abbreviated New Drug 
Application (ANDA) is required by a licensed practitioner to 
produce a compounded PET drug produced in accordance with USP 
standards.
    Section 619(d) requires the revocation of certain Federal 
Register notices which announced a rule inconsistent with this 
legislation.
    PET is an imaging technique that produces a computerized 
image (scan) using small quantities of a radioactive tracer to 
measure biochemical activity in the body. It has been 
demonstrated to be an extremely effective method of separating 
benign from malignant lesions, staging the degree of 
metastasis, determining therapeutic effectiveness and 
identifying early recurrence of disease in several types of 
cancer, including lung, breast, colorectal, head and neck. In 
addition, PET has a high degree of accuracy in identifying 
early signs of coronary artery disease and in assessing whether 
cardiac tissue is alive following a heart attack. In more than 
one million uses of PET tracers in Europe and one million in 
the United States, the Committee is unaware of any reported 
instance of an adverse reaction to PET radiotracers. PET 
radiopharmaceuticals have been used in patients in the United 
States for over 30 years. Recent research and advances in 
imaging technology have enhanced the clinical importance of 
PET.
    PET radiotracers are unique among radiopharmaceuticals 
because of their short half-lives, ranging from 30 seconds to 
110 minutes. Therefore, most PET radiotracers are made using a 
cyclotron which is at or near the PET site, and most are made 
up on an individual dose basis upon the prescription of a 
licensed physician. At present, there are 70 PET centers in the 
United States, almost all of which are part of academic medical 
centers. PET technology and its applications were developed in 
large part with almost $2 billion in federal research funds. 
Yet, while PET is widely used in Europe, its benefits have not 
been widely available to American patients, mainly because of 
lack of reimbursement and inappropriate and costly regulations 
promulgated by FDA.
    Under current FDA regulations, PET centers which compound 
PET radiopharmaceuticals on an individual dose basis would be 
required to meet FDA's CGMP and to file NDA's and ANDA's for 
each type of PET tracer and for each indication for which the 
tracer might be used. This is the same type of regulation which 
the FDA applies to large pharmaceutical manufacturers.
    Academic medical centers are facing unprecedented cost 
pressures. Without regulatory relief and expanded 
reimbursement, particularly from the Medicare program, many PET 
centers are likely to close, and the benefits of PET will be 
unavailable to the taxpayers who funded their development. For 
example, the University of California at Los Angeles estimated 
that FDA's new PET regulations would cost the University at 
least $300,000 for a single application for a single use of a 
PET radiotracer.
    The committee intends that adoption of this section will 
establish a regulatory framework for PET drugs that will enable 
PET centers to continue to make this valuable technology 
available to patients at reasonable cost and assure that the 
public health will be protected.

                   Title VII--Fees Relating to Drugs

    The legislation reauthorizes the Prescription Drug User Fee 
Act of 1992 (PDUFA I) to allow the continued collection of user 
fees from prescription drug manufacturers for five additional 
years. PDUFA I represented a consensus among the FDA, the 
prescription drug industry, and Congress that the industry 
would pay user fees to augment the resources of the FDA devoted 
to the review of human drug applications. PDUFA I has succeeded 
in substantially reducing review times for human drug 
applications.
    The PDUFA I legislation was accompanied by side letters 
signed by the Commissioner of Food and Drugs and the Chairs and 
Ranking Minority Members of the House Energy and Commerce 
Committee and the Senate Labor and Human Resources Committee. 
The side letters committed FDA to achieving certain performance 
measures including:
          Review and act on priority new drug and biologic 
        applications within 6 months:
          Review and act on standard new drug and biologic 
        applications with 12 months;
          Review and act on priority supplements and amendments 
        within 6 months;
          Review and act on standard supplements and amendments 
        that do not require clinical data within 6 months;
          Review and act on standard supplements and amendments 
        with clinical data within 12 months; and
          Review and act on resubmitted applications within 6 
        months.
    Title VII of S. 830 (PDUFA II) would build on PDUFA I by 
including new commitments from FDA to implement more ambitious 
and comprehensive improvements in its regulatory process. PDUFA 
I focused on reducing the length of time taken by FDA in 
reviewing an application. The committee commends FDA for 
successfully meeting and at times exceeding the performance 
goals established in PDUFA I. However, while review times for 
submitted applications have improved, the period of time taken 
to get a drug through the drug development phase has increased 
from 2 years to seven years. Appropriately, PDUFA II will focus 
on shortening overall development time and streamlining 
interaction with FDA required of a drug innovator during the 
highly regulated drug development phase and establish new 
performance measures and procedures for FDA designed to reduce 
the amount of time needed to take a drug from clinical testing 
phase to the point where an application may be submitted for 
review.
    The legislation provides that the FDA's fiscal year 1997 
appropriations will become the new PDUFA baseline 
appropriation, adjusted for inflation after fiscal year 1998, 
over the next five years. The bill assumes that for Fiscal year 
1998, FDA will receive at least the Fiscal year 1997 level of 
appropriated funds for salaries and expenses. It specifies 
exactly what the application and supplemental fees will be per 
product for the next five years, subject to adjustment for 
inflation. In addition, it defines small businesses as those 
with fewer than 500 employees, and allows a waiver for such 
businesses fee payments on their first human drug applications. 
FDA would continue to be required to send Congress annually a 
financial report on how it spent PDUFA fees and report on 
whether and how FDA met the new performance goals which focus 
on expediting the drug development process and the review of 
human drug applications.
    The differences between PDUFA I and PDUFA II can be divided 
into two categories. The first category of changes pertains to 
financial provisions and performance goals. Among other things, 
these changes include the increase in fees from PDUFA I to 
accommodate enhanced performance by FDA and the adjustment of 
total fees each year to reflect a changing FDA workload. As 
with PDUFA I, revised performance goals will be set forth in 
letters from the Secretary of the Department of Health and 
Human Services official to the Chairman and Ranking Minority 
Members of the House Commerce Committee and Senate Committee on 
Labor and Human Resources. This letter is incorporated by 
reference in the Findings section of Title VII of the bill. The 
committee intends that the provisions be fully binding on the 
agency and should be considered as minimum not maximum 
commitments.
    The second category of changes includes technical changes 
and other improvements which primarily relate to fee collection 
and exemptions from fees, including language providing the 
Secretary flexibility to take into account special 
circumstances associated with user fee waiver applications. 
These special circumstances may include the ability to 
stimulate innovation inbiomedical research by providing special 
waivers or discounts to applicants participating in innovative research 
development projects located in Federal empowerment and enterprise 
zones. A detailed review of the performance goals and other measures 
covered by PDUFA II, referenced in Section 702 of the bill, are 
reflected in the exchange of letters that follow below.
    These performance measures, agreed to by FDA officials and 
the boards of the Biotechnology Industry Organization and the 
Pharmaceutical Research and Manufacturers of America, are 
contingent upon the level of appropriated funds for the FDA set 
forth in the legislation. The committee observes that PDUFA I 
was successful in large part because the underlying assumption 
regarding steadily increasing appropriations levels available 
to FDA was in fact borne out. The committee cautions that this 
key assumption can not be taken for granted over the next five 
years in light of the overriding imperative to reduce the 
Federal budget deficit and the complicating factors contributed 
by the President's proposed budget cut for the FDA in fiscal 
year 1998.
    Finally, the committee notes that the Food, Drug, and 
Cosmetic Act gives the Secretary of HHS discretion to grant a 
waiver from, or a reduction of 1 or more user fees where the 
Secretary finds ``the assessment of the fee would present a 
significant barrier to innovation because of limited resources 
available to such person or other circumstances.'' This 
language is intended to provide the Secretary flexibility to 
take into account special circumstances associated with user 
fee waiver applications including the ability to stimulate 
innovation in biomedical research by providing special waivers 
or discounts to applicants participating in innovative research 
development projects in federal empowerment and enterprise 
zones.

           proposed pdufa ii performance goals and procedures

    The proposed performance goals and procedures of the FDA 
Center for Drug Evaluation and Research (CDER) and the Center 
for Biologics Evaluation and Research (CBER), contingent upon 
resolution of Agency and program budget issues, are summarized 
as follows:

                 a. five-year review performance goals

Fiscal year 1998

    1. Review and act on 90 percent of standard original New 
Drug Application (NDA's) and Product License Applications 
(PLA's)/Biologic License Applications (BLA's) filed during 
fiscal year 1998 within 12 months of receipt.
    2. Review and act on 90 percent of priority original NDA 
and PLA/BLA submissions filed during fiscal year 1998 within 6 
months of receipt.
    3. Review and act on 90 percent of standard efficacy 
supplements filed during fiscal year 1998 within 12 months of 
receipt.
    4. Review and act on 90 percent of priority efficacy 
supplements filed during fiscal year 1998 within 6 months of 
receipt.
    5. Review and act on 90 percent of manufacturing 
supplements filed during fiscal year 1998 within 6 months of 
receipt.
    6. Review and act on 90 percent of all resubmitted original 
applications filed during fiscal year 1998 within 6 months of 
receipt, and review and act on 30 percent of class 1 
resubmitted original applications within 2 months of receipt.

Fiscal year 1999

    1. Review and act on 90 percent of standard original NDA 
and PLA/BLA submissions filed during fiscal year 1999 within 12 
months of receipt and review and act on 30 percent within 10 
months of receipt.
    2. Review and act on 90 percent of priority original NDA 
and PLA/BLA submissions filed during fiscal year 1999 within 6 
months of receipt.
    3. Review and act on 90 percent of standard efficacy 
supplements filed during fiscal year 1999 within 12 months of 
receipt and review and act on 30 percent within 10 months of 
receipt.
    4. Review and act on 90 percent of priority efficacy 
supplements filed during fiscal year 1999 within 6 months of 
receipt.
    5. Review and act on 90 percent of manufacturing 
supplements filed during fiscal year 1999 within 6 months of 
receipt and review and act on 30 percent of manufacturing 
supplements requiring prior approval within 4 months of 
receipt.
    6. Review and act on 90 percent of class 1 resubmitted 
original applications filed during fiscal year 1999 within 4 
months of receipt and review and act on 50 percent within 2 
months of receipt.
    7. Review and act on 90 percent of class 2 resubmitted 
original applications filed during fiscal year 1999 within 6 
months of receipt.

Fiscal year 2000

    1. Review and act on 90 percent of standard original NDA 
and PLA/BLA submissions filed during fiscal year 2000 within 12 
months of receipt and review and act on 50 percent within 10 
months of receipt.
    2. Review and act on 90 percent of priority original NDA 
and PLA/BLA submissions filed during fiscal year 2000 within 6 
months of receipt.
    3. Review and act on 90 percent of standard efficacy 
supplements filed during fiscal year 2000 within 12 months of 
receipt and review and act on 50 percent within 10 months of 
receipt.
    4. Review and act on 90 percent of priority efficacy 
supplements filed during fiscal year 2000 within 6 months of 
receipt.
    5. Review and act on 90 percent of manufacturing 
supplements filed during fiscal year 2000 within 6 months of 
receipt and review and act on 50 percent of manufacturing 
supplements requiring prior approval within 4 months of 
receipt.
    6. Review and act on 90 percent of class 1 resubmitted 
original applications filed during fiscal year 2000 within 4 
months and review and act on 50 percent within 2 months of 
receipt.
    7. Review and act on 90 percent of class 2 resubmitted 
original applications filed during fiscal year 2000 within 6 
months of receipt.

Fiscal year 2001

    1. Review and act on 90 percent of standard original NDA 
and PLA/BLA submissions filed during fiscal year 2001 within 12 
months of receipt and review and act on 70 percent within 10 
months of receipt.
    2. Review and act on 90 percent of priority original NDA 
and PLA/BLA submissions filed during fiscal year 2001 within 6 
months of receipt.
    3. Review and act on 90 percent of standard efficacy 
supplements filed during fiscal year 2001 within 12 months of 
receipt and review and act on 50 percent within 10 months of 
receipt.
    4. Review and act on 90 percent of priority efficacy 
supplements filed during fiscal year 2001 within 6 months of 
receipt.
    5. Review and act on 90 percent of manufacturing 
supplements filed during fiscal year 2001 within 6 months of 
receipt and review and act on 70 percent of manufacturing 
supplements requiring prior approval within 4 months of 
receipt.
    6. Review and act on 90 percent of class 1 resubmitted 
original applications filed during fiscal year 2001 within 4 
months and review and act on 70 percent within 2 months of 
receipt.
    7. Review and act on 90 percent of class 2 resubmitted 
original applications within 6 months of receipt.

Fiscal year 2002

    1. Review and act on 90 percent of standard original NDA 
and PLA/BLA submissions filed during fiscal year 2001 within 12 
months of receipt.
    2. Review and act on 90 percent of priority original NDA 
and PLA/BLA submissions filed during fiscal year 2001 within 6 
months of receipt.
    3. Review and act on 90 percent of standard efficacy 
supplements filed during fiscal year 2001 within 10 months of 
receipt.
    4. Review and act on 90 percent of priority efficacy 
supplements filed during fiscal year 2001 within 6 months of 
receipt.
    5. Review and act on 90 percent of manufacturing 
supplements filed during fiscal year 2001 within 6 months of 
receipt and review and act on 90 percent of manufacturing 
supplements requiring prior approval within 4 months of 
receipt.
    6. Review and act on 90 percent of class 1 resubmitted 
original applications within 6 months of receipt.
    7. Review and act on 90 percent of class 2 resubmitted 
original applications within 6 months of receipt.
    These review goals are summarized in the following tables:
    Original NDA's/BLA's/PLA's and Efficacy Supplements:

------------------------------------------------------------------------
       Submission cohort              Standard            Priority      
------------------------------------------------------------------------
Fiscal year 1998...............  90 percent in 12   90 percent in 6 mo. 
                                  mo.                                   
Fiscal year 1999...............  30 percent in 10   90 percent in 6 mo. 
                                  mo.                                   
                                 90 percent in 12                       
                                  mo                                    
Fiscal year 2000...............  50 percent in 10   90 percent in 6 mo. 
                                  mo.                                   
                                 90 percent in 12                       
                                  mo                                    
Fiscal year 2001...............  70 percent in 10   90 percent in 6 mo. 
                                  mo.                                   
                                 90 percent in 12                       
                                  mo                                    
Fiscal year 2002...............  90 percent in 10   90 percent in 6 mo. 
                                  mo.                                   
------------------------------------------------------------------------

    Manufacturing supplements:

------------------------------------------------------------------------
                                   Manufacturing                        
                                  supplements that                      
                                   do not require       Manufacturing   
                                   prior approval    supplements that do
       Submission cohort          (``changes being      require prior   
                                   effected'' or          approval      
                                      ``30-day                          
                                   supplements''                        
------------------------------------------------------------------------
Fiscal year 1998...............  90 percent in 6    90 percent in 6 mo. 
                                  mo.                                   
Fiscal year 1999...............  90 percent in 6    30 percent in 4 mo. 
                                  mo.               90 percent in 6 mo. 
Fiscal year 2000...............  90 percent in 6    50 percent in 4 mo. 
                                  mo.               90 percent in 6 mo. 
Fiscal year 2001...............  90 percent in 6    70 percent in 4 mo. 
                                  mo.               90 percent in 6 mo. 
Fiscal year 2002...............  90 percent in 6    90 percent in 4 mo. 
                                  mo.                                   
------------------------------------------------------------------------

    Resubmission of original NDA's/BLA's/PLA's:

------------------------------------------------------------------------
       Submission cohort              Class 1              Class 2      
------------------------------------------------------------------------
Fiscal year 1998...............  90 percent in 6    90 percent in 6 mo. 
                                  mo.                                   
                                 30 percent in 2                        
                                  mo                                    
Fiscal year 1999...............  90 percent in 4    90 percent in 6 mo. 
                                  mo.                                   
                                 50 percent in 2                        
                                  mo                                    
Fiscal year 2000...............  90 percent in 4    90 percent in 6 mo. 
                                  mo.                                   
                                 70 percent in 2                        
                                  mo                                    
Fiscal year 2001...............  90 percent in 2    90 percent in 6 mo. 
                                  mo.                                   
Fiscal year 2002...............  90 percent in 2    90 percent in 6 mo. 
                                  mo.                                   
------------------------------------------------------------------------

            b. new molecular entity (nme) performance goals

    The performance goals for standard and priority original 
NME's in each submission cohort will be the same as for all of 
the original NDA's (including NME's) in each submission cohort 
but shall be reported separately.
    For biological products, for purposes of this performance 
goal, all original BLAs/PLAs will be considered to be NMEs.

                      c. meeting management goals

1. Responses to meeting requests

    a. Procedure: Within 14 calendar days of the agency's 
receipt of a request from industry for a formal meeting (i.e., 
a scheduled face-to-face, teleconference, or videoconference) 
CBER and CDER should notify the requester in writing (letter or 
fax) of the date, time, and place for the meeting, as well as 
expected Center participants.
    b. Performance Goal: FDA will provide this notification 
within 14 days for 70 percent of requests (based on request 
receipt cohort year) starting in FY99; 80 percent in FY00; and 
90 percent in subsequent fiscal years.

2. Scheduling meetings

    a. Procedure: The meeting date should reflect the next 
available date on which all applicable Center personnel are 
available to attend, consistent with the component's other 
business; however, the meeting should be scheduled consistent 
with the type of meeting requested. If the requested date for 
any of these types of meetings is greater than 30, 60, or 75 
calendar days (as appropriate) from the date the request is 
received by the agency, the meeting date should be within 14 
calendar days of the date requested.
    Type A meetings should occur within 30 calendar days of the 
agency receipt of the meeting request.
    Type B meetings should occur within 60 calendar days of the 
agency receipt of the meeting request.
    Type C meetings should occur within 75 calendar days of the 
agency receipt of the meeting request.
    b. Performance goal: 70 percent of meetings are held within 
the timeframe (based on cohort year of request) starting in 
FY99; 80 percent in FY00; and 90 percent in subsequent fiscal 
years.

3. Meeting minutes

    a. Procedure: The agency will prepare minutes which will be 
available to the sponsor 30 calendar days after the meeting. 
The minutes will clearly outline the important agreements, 
disagreements, issues for further discussions, and action items 
from the meeting in bulleted form and need not be in great 
detail.
    b. Performance goal: 70 percent of minutes are issued 
within 30 calendar days of date of meeting (based on cohort 
year of meeting) starting in FY99; 80 percent in FY00; and 90 
percent in subsequent fiscal years.

4. Conditions

    For a meeting to qualify for these performance goals:
          a. A written request (letter or fax) should be 
        submitted to the review division; and
          b. The letter should provide:
                  i. A brief statement of the purpose of the 
                meeting;
                  ii. A listing of the specific objectives/
                outcomes the requester expects from the 
                meeting;
                  iii. A proposed agenda, including estimated 
                times needed for each agenda item;
                  iv. A listing of planned external attendees;
                  v. A listing of requested participants/
                disciplines representative(s) from the Center;
                  vi. The approximate time that supporting 
                documentation (i.e., the ``backgrounder'') for 
                the meeting will be sent to the Center (i.e., 
                ``x'' weeks prior to the meeting, but should be 
                received by the Center at least 2 weeks in 
                advance of the scheduled meeting for Type or C 
                meetings and at least 1 month in advance of the 
                scheduled meeting for Type B meetings; and
          c. The agency concurs that the meeting will serve a 
        useful purpose (i.e., it is not premature or clearly 
        unnecessary). However, requests for a ``Type B'' 
        meeting will be honored except in the most unusual 
        circumstances.

                           D. CLINICAL HOLDS

    1. Procedure: The Center should respond to a sponsor's 
complete response to a clinical hold within 30 days of the 
agency's receipt of the submission of such sponsor response.
    2. Performance goal: 75 percent of such responses are 
provided within 30 calendar days of the Agency's receipt of the 
sponsor's response starting in FY98 (cohort of date of receipt) 
and 90 percent in subsequent fiscal years.

                      E. Major dispute resolution

    1. Procedure: For procedural or scientific matters 
involving the review of human drug products (as defined in 
PDUFA) that cannot be resolved at the divisional level 
(including a request for reconsideration by the Division after 
reviewing any materials that are planned to be forwarded with 
an appeal to the next level), the response to appeals of 
decisions will occur within 30 calendar days of the Center's 
receipt of the written appeal.
    2. Performance goal: 70 percent of such answers are 
provided within 30 calendar days of the Center's receipt of the 
written appeal starting in FY99; 80 percent in FY00; and 90 
percent in subsequent fiscal years.
    3. Conditions.
    a. Sponsors should first try to resolve the procedural or 
scientific issue at the Division level. If it cannot be 
resolved at that level, it should be appealed to the Office 
Director level (with a copy to the Division Director) and then, 
if necessary, to the Deputy Center Director or Center Director 
(with a copy to the Office Director).
    b. Responses should be either verbal (followed by a written 
confirmation within 14 calendar days of the verbal 
notification) or written and should ordinarily be to either 
deny or grant the appeal.
    c. If the decision is to deny the appeal, the response 
should include reasons for the denial and any actions the 
sponsor might take in order to persuade the agency to reveres 
its decision.
    d. In some cases, further data or further input from others 
might be needed to reach a decision on the appeal. In these 
cases, the ``response'' should be the plan for obtaining that 
information (e.g., requesting further information from the 
sponsor, scheduling a meeting with the sponsor, scheduling the 
issue for discussion at the next scheduled available advisory 
committee).
    e. In these cases, once the required information is 
received by the agency (including any advice from an advisory 
committee), the person to whom the appeal was made, again has 
30 calendar days from the receipt of the required information 
in which to either deny or grant the appeal.
    f. Again, if the decision is to deny the appeal, the 
response should include the reasons for the denial and any 
actions the sponsor might take in order to persuade the agency 
to reverse its decision.
    g. N.B.: If the agency decides to present the issue to an 
advisory committee and there are not 30 days before the next 
scheduled advisory committee, the issue will be presented at 
the following scheduled committee meeting in order to allow 
conformance with advisory committee administrative procedures.

         F. SPECIAL PROTOCOL QUESTION ASSESSMENT AND AGREEMENT

    1. Procedure: Upon specific request by a sponsor (including 
specific questions that the sponsor desiresto be answered), the 
agency will evaluate certain protocols and issues to assess whether the 
design is adequate to meet scientific and regulatory requirements 
identified by the sponsor.
    a. The sponsor should submit a limited number of specific 
questions about the protocol design and scientific and 
regulatory requirements for which the sponsor seeks agreement 
(e.g., is the dose range in the carcinogenicity study adequate, 
considering the intended clinical dosage; are the clinical 
endpoints adequate to support a specific such an.
    b. Within 45 days of agency receipt of the protocol and 
specific questions, the agency will provide a written response 
to the sponsor that includes a succinct assessment of the 
protocol and answers to the questions posed by the sponsor. If 
the agency does not agree that the protocol design, execution 
plans, and data analyses are adequate to achieve the goals of 
the sponsor, the reasons for the disagreement will be explained 
in the response.
    c. Protocols that qualify for this program include: 
carcinogenicity protocols, stability protocols, and Phase 3 
protocols for clinical trials that will form the primary basis 
of an efficacy claim. (For such Phase 3 protocols to qualify 
for this comprehensive protocol assessment, the sponsor must 
have had an end of Phase 2/pre-Phase 3 meeting with the review 
division so that the division is aware of the developmental 
context in which the protocol is being reviewed and the 
questions being answered.)
    d. N.B.: For products that will be using Subpart E or 
Subpart H development schemes, the Phase 3 protocols mentioned 
in this paragraph should be construed to mean those protocols 
for trials that will form the primary basis of an efficacy 
claim no matter what phase of drug development in which they 
happen to be conducted.
    e. If a protocol is reviewed under the process outlined 
above and agreement with the agency is reached on design, 
execution, and analyses and if the results of the trial 
conducted under the protocol substantiate the hypothesis of the 
protocol, the agency agrees that the data from the protocol can 
be used as part of the primary basis for approval of the 
product. The fundamental agreement here is that having agreed 
to the design, execution, and analyses proposed in protocols 
reviewed under this process, the agency will not later alter 
its perspective on the issues of design, execution, or analyses 
unless public health concerns unrecognized at the time of 
protocol assessment under this process are evident.
    2. Performance goal: 60 percent of special protocols 
assessments and agreement requests completed and returned to 
sponsor within timeframes (based on cohort year of request) 
starting in FY 99; 70 percent in FY00; 80 percent in Fiscal 
year 01; and 90 percent in FY02.

               g. electronic applications and submissions

    The agency shall develop and update its information 
management infrastructure to allow, by fiscal year 2002, the 
paperless receipt and processing of INDs and human drug 
applications, as defined in PDUFA, and related submissions.

                        h. additional procedures

    1. Simplification of Action Letters.
    To simplify regulatory procedures, the CBER and the CDER 
intend to amend their regulations and processes to provide for 
the issuance of either an ``approval'' (AP) or a ``complete 
response'' (CR) action letter at the completion of a review 
cycle for a marketing application.
    2. Timing of Sponsor Notification of Deficiencies in 
Applications.
    To help expedite the development of drug and biologic 
products, CBER and CDER intend to submit deficiencies to 
sponsors in the form of an ``information request'' (IR) letter 
when each discipline has finished its initial review of its 
section of the pending application.

                i. definitions and explanation of terms

    1. The term ``review and act on'' is understood to mean the 
issuance of a complete action letter after the complete review 
of a filed complete application. The action letter, if it is 
not an approval, will set forth in detail the specific 
deficiencies and, where appropriate, the actions necessary to 
place the application in condition for approval.
    2. A major amendment to an original application submitted 
within 3 months of the goal date extends the goal date by 3 
months.
    3. A resubmitted original application is a complete 
response to an action letter addressing all identified 
deficiencies.
    4. Class 1 resubmitted applications are applications 
resubmitted after a complete response letter (or a not 
approvable or approvable letter) that include the following 
items only (or combinations of these items):
    a. Final printed labeling.
    b. Draft labeling.
    c. Safety updates submitted in the same format, including 
tabulations, as the original safety submission with new data 
and changes highlighted (except when large amounts of new 
information including important new adverse experiences not 
previously reported with the product are presented in the 
resubmission).
    d. Stability updates to support provisional or final dating 
periods.
    e. Commitments to perform Phase 4 studies, including 
proposals for such studies.
    f. Assay validation data.
    g. Final release testing on the last 1-2 lots used to 
support approval.
    h. A minor reanalysis of data previously submitted to the 
application (determined by the agency as fitting the class 1 
category).
    i. Other minor clarifying information (determined by the 
agency as fitting the class 1 category).
    j. Other specific items may be added later as the Agency 
gains experience with the scheme and will be communicated via 
guidance documents to industry.
    5. Class 2 resubmissions are resubmissions that include any 
other items, including any item that would require presentation 
to an advisory committee.
    6. A Type A meeting is a meeting which is necessary for an 
otherwise stalled drug development program to proceed (a 
``critical path'' meeting).
    7. A Type B meeting is a (1) pre-IND, (2) end of Phase 1 
(for Subpart E or Subpart H or similar products) or end of 
Phase 2/pre-Phase 3, or (3) a pre-NDA/PLA/BLA meeting. Each 
requestor should usually only request 1 each of these Type B 
meetings for each potential application (NDA/PLA/BLA) (or 
combination of closely related products, i.e., same active 
ingredient but different dosage forms being developed 
concurrently).
    8. A Type C meeting is any other type of meeting.

                       Title VIII--Miscellaneous

Clarification of seizure authority

    There are two situations under which FDA-regulated products 
are imported into the United States and enter domestic 
commerce. The first occurs when the product passes FDA and 
Customs scrutiny at the border and is permitted entry into the 
country. The second is under section 801(d)(3), as added by the 
FDA Export Reform and Enhancement Act of 1996, which permits 
products to be imported into the United States solely for 
processing with the requirement that the finished product 
subsequently be exported. Section 803 amends the seizure 
provisions in section 304(d)(1) of the act to clarify that any 
person who seeks to export an article that has been imported 
under either of these conditions, pursuant to the export 
provisions in section 801(e) of the Act, must demonstrate that 
the article was intended for export at the time that it entered 
commerce. The clarification of section 304(d) applies only to 
seized and condemned imported articles and does not affect 
articles proffered for import that are refused entry under 
section 801(a) and properly exported within 90 days of refusal.

National uniformity for nonprescription drugs and cosmetics

    The economic strength and vitality for consumer products in 
the United States rests upon the tradition of one vast 
nationwide marketplace, regulated by strong Federal and State 
agencies committed to protecting the public health. An 
essential element of a nationwide marketplace is a national 
uniform system of regulation. It is intended that the FDA 
provide national leadership in assuring the safety, 
effectiveness, and proper labeling and packaging for 
nonprescription drugs and cosmetics marketed throughout the 
country, under the Federal Food, Drug, and Cosmetic Act, the 
Poison Prevention Packaging Act, and the Fair Packaging and 
Labeling Act.
    Under our Federal system, it is important that State and 
local officials enforce the same regulatory requirements for 
products as do our Federal officials. Different or additional 
requirements as the State or local level can work against our 
national marketplace, confuse consumers, raise prices, 
undermine public confidence in our regulatory system and in 
products important to the public health, and result in 
divergent public health protection throughout the country.
    Federal law currently provides strong public health 
protection for nonprescription drugs and cosmetics and their 
constituents. Nonprescription drugs are subject to careful and 
comprehensive regulation by the FDA. The conditions under which 
nonprescription drugs are considered safe and effective, for 
use by the lay consumer, are specified by FDA in 
nonprescription drug monographs or by new drug and antibiotic 
drug applications. FDA also ensures that the labeling of 
nonprescription drugs provides adequate directions for use, and 
adequate warnings against unsafe use, through these monographs 
and drug marketing applications, as well as through a number of 
general and specific labeling regulations. The FDA also has 
strong legal authority to regulate cosmetics. A cosmetic is 
considered adulterated if it contains a substance that may be 
injurious to users. The FDA has required that every cosmetic 
ingredient and every finished cosmetic product be substantiated 
for safety before it can be marketed. A cosmetic is misbranded 
if the safety of the product or an ingredient has not been 
established prior to marketing and that fact is not disclosed 
in a label warning. FDA also requires all ingredients to be 
declared on the label of cosmetics. For both nonprescription 
drugs and cosmetics, the FDA has clear statutory authority to 
require warnings or to ban unsafe ingredients. Use of any 
unsafe ingredient, or any false or misleading labeling, for a 
nonprescription drug or a cosmetic is unlawful and subject to 
regulatory action. The FDA authority in this area extends from 
manufacture through retail sale of these products.
    Section 808 of the legislation therefore established a new 
section 761 of the Federal Food, Drug, and Cosmetic Act that 
adopts, as a general rule, the requirement of national 
uniformity in the regulation of nonprescription drugs and 
cosmetics and their constituents. No State or local government 
is permitted to impose different or additional requirements 
that relate to the subject matter covered by the three Federal 
laws as they apply to nonprescription drugs and cosmetics. 
These include requirements imposed on product manufacture or 
composition, labeling, advertising, or any other form of public 
notification or communication.
    Under the legislation, all States may vigorously enforce 
requirements for nonprescription drugs and cosmetics that are 
identical to the Federal requirements, including the Federal 
prohibition against the adulteration or misbranding of these 
products. Most States have enacted laws regulating 
nonprescription drugs and cosmetics, based on the Federal laws, 
that prohibit the adulteration or misbranding of these products 
in the same terms as the Federal laws. These identical State 
requirements may be enforced by State officials, without first 
notifying the FDA or obtaining any Federal approval, using 
compliance powers that are different from or in addition to the 
Federal compliance mechanisms, e.g., the power of a State to 
order an embargo or recall of a violative product or to impose 
civil penalties. States may also continue to use such 
traditional revenue measures as registration fees. Accordingly, 
one consistent national regulatory system will be implemented, 
relying upon both Federal and State enforcement, providing 
strengthened public health protection throughout the country.
    There may occasionally be situations where a local problem 
could justify a different or additional regulatory requirement 
for nonprescription drugs or cosmetics in a particular State. 
The legislation therefore specifically authorizes States to 
petition for an exemption from the general rule of national 
uniformity under these circumstances. The FDA may grant an 
exemption if the State demonstrates that its proposed local 
requirement protects an important public interest that is not 
protected under the Federal laws, the local requirement would 
not cause any nonprescription drug or cosmetic to be in 
violation of any Federal law, and the local requirement would 
not unduly burden interstate commerce. State exemption 
petitions should be given a high priority by the FDA, and 
should be handled promptly upon receipt. Where the problem 
identified by a State could represent a national problem, on 
the other hand, the proper way for a State to proceed would be 
by petitioning the FDA to change the national requirements, 
using established agency procedures.
    The legislation allows State officials to place a 
nonprescription drug on prescription only, to solve a local 
problem such as a localized outbreak of abuse of a product. 
Once the problem has abated, the drug can then be switched back 
to nonprescription status. Similarly, State laws will continue 
to apply to the practice of pharmacy, i.e., to the licensing, 
discipline, and professional duties of pharmacists. 
Accordingly, the legislation clearly recognizes and reflects 
the paramount need to protect the public health, both locally 
and nationally.
    A State, locality, or person may continue to take advantage 
of their right to petition the FDA, where it has not issued a 
regulation, to make a certain requirement a national 
requirement, under the right supplied to them in 21 CFR 10.30, 
the citizen petition provision of the Code of Federal 
Regulations.
    The FDA jurisdiction relating to dissemination of 
information about nonprescription drugs and cosmetics and their 
constituents applies to the label and labeling for these 
products. It is important that any State or local requirements 
imposed on industry relating to the advertising of 
nonprescription drugs or cosmetics, or to any other form of 
public notification or communication relating to these products 
and their constituents, be identical with the FDA requirements 
for the label and labeling of these products. Accordingly, the 
legislation extends national uniformity to the requirements for 
all forms of public information and public communication, not 
just to the label and labeling. The legislation, however, would 
not preclude State officials from issuing their own State 
warnings in accordance with local law. Similarly, voluntary 
programs such as the ``Mr. Yuk'' initiative sponsored by local 
Poison Control Centers will not be affected.
    Under the legislation, national uniformity is provided for 
all of the types of requirements for nonprescription drugs and 
cosmetics and their constituents under State laws that are 
related to requirements included in the Federal laws, e.g., 
requirements to prevent adulteration or misbranding or other 
illegal marketing or to issue public notice about the safety of 
constituents. All forms of State requirements that affect these 
products are included within the general rule of national 
uniformity, whether they are specifically denominated as 
applying to nonprescription drugs and cosmetics or more broadly 
apply to unfair competition or to all chemicals, ingredients, 
orcontaminants to which consumers and other members of the 
public are exposed. To the extent that any type of State law imposes a 
requirement for a warning or other type of public notification with 
respect to nonprescription drugs or cosmetics or any constituent, that 
requirement is prohibited unless such a requirement is prescribed under 
one of the three identified Federal laws and the State requirement is 
identical to the Federal requirement.
    Finally, the legislation explicitly provides that it shall 
not be construed to modify or otherwise affect the traditional 
product liability law of any State. Tort liability rules and 
requirements would remain unchanged and unaffected.
    The committee further notes the importance of 
nonprescription drugs in the nation's health care system. While 
consumers spend less than 2 cents of their health care dollar 
on nonprescription drugs, such drugs produce substantial 
savings to the individual and the health care system in 
reductions in physician visits, prescription drug costs, 
insurance costs, lost time from work, and travel. The committee 
notes that products switched from prescription to 
nonprescription status contribute significantly to these 
savings. For example, according to a study conducted by Kline & 
Company, consumer health care savings attributable to self-care 
with nonprescription medicines reached $20.6 billion in 1996. 
Kline calculated that medicines transferred from prescription 
to nonprescription status were responsible for $12.9 billion of 
the $20.6 billion savings. The savings are determined by 
calculating what consumers would be likely to spend if, instead 
of using nonprescription medicines, they were to see a doctor, 
purchase a prescription medicine and lose time from work.
    The committee therefore expects that the FDA, as part of 
its mission set forth in section 101 of this legislation (i.e., 
``shall promptly and efficiently review clinical research and 
take appropriate action on the marketing of regulated products 
in a manner that does not unduly impede innovation or product 
availability'') will establish appropriate procedures and 
policies, including performance standards, to expedite the 
review of applications to switch prescription drugs to 
nonprescription status. The committee encourages the FDA to 
give strong consideration to establishing a separate office for 
nonprescription drugs and conferring on that office primary 
review and sign-off authority for applications to switch drugs 
from prescription to nonprescription status. At a minimum, the 
committee recommends that an individual or individuals within 
the Center for Drug Evaluation and Research be designated to 
ensure timely and efficient agency review and action on such 
applications and that the agency consider using the explicit 
authority granted to it to contract for outside expert review 
when such contracts would achieve more timely and efficient 
reviews.''

Information program on clinical trials for serious or life-threatening 
        diseases

    Sec. 808 amends section 402 of the Public Health Services 
Act to establish a registry of clinical trials, both publicly 
or privately funded, of experimental drugs and biologicals for 
serious or life-threatening medical conditions. Registry 
information must be understandable to the general public and 
include the purpose of the experimental protocol, trial 
eligibility criteria, and sites and contact points for people 
wishing to enroll in a trial. Patients, health care providers, 
researchers and the public would access the registry through 
toll-free telephone communications and other information 
systems. Sec. 808 also requires the Secretary of HHS, within 2 
years after enactment, to investigate and report on whether it 
is necessary or feasible to include medical device trials in 
the registry. The purpose of the registry is to simplify the 
process through which individuals with serious or life-
threatening medical conditions obtain information about 
opportunities to participate in clinical trials of experimental 
therapies.

Pharmacy compounding

    Section 809 of S. 830 is intended to clarify the 
application of the Federal Food, Drug and Cosmetic Act to the 
professional practice of pharmacist compounding of drug 
products. States currently have the authority to license 
pharmacists and regulate pharmacies, including the scope of 
pharmacy practice. All Statesinclude compounding as a core 
component of the profession of pharmacy. While the Food, Drug and 
Cosmetic Act specifically exempts pharmacies from inspection and 
registration provisions of the Act, it has been the contention of the 
Food and Drug Administration that compounded products are not exempt 
from the Act's new drug provisions. The committee has found that 
clarification is necessary to address current concerns and uncertainty 
about the Food and Drug Administration's regulatory authority over 
pharmacy compounding.
    The committee has worked extensively with the Food and Drug 
Administration and other interested parties to reach consensus 
on how to ensure continued availability of compounded drug 
products as a component of individualized therapy, while 
limiting the scope of compounding so as to prevent small-scale 
manufacturing under the guise of compounding. Section 809 
establishes parameters under which compounding is appropriate 
and lawful. This section is not intended to subvert the 
requirements that apply to investigational new drugs or to 
result in experimentation without appropriate human subject 
protections, including proper informed consent.
    The views of the Committee with respect to certain 
subsections of Section 809 are outlined below:
          The exemptions in section (h)(1) are limited to 
        compounding for an individual patient based on the 
        medical need of such patient for the particular drug 
        compounded. To qualify for the exemptions, the 
        pharmacist or physician must be able to cite a 
        legitimate medical need for the compounded product that 
        would explain why a commercially available drug product 
        would not be appropriate. Although recording the 
        medical need directly on each prescription order would 
        not be required, this technique would be one of many 
        acceptable ways of documenting the medical need for 
        each compounded drug product. This medical need would 
        not include compounding drugs that are essentially 
        copies of commercially available drug products for 
        largely economic reasons. The pharmacist may rely on 
        appropriately documented input from the physician as to 
        whether a commercially available drug product is not 
        appropriate for the identified individual patient.
          Implementation of subsection (h)(1)(B)(I)(I)(bb), 
        regarding bulk drug substances, is expected to coincide 
        with the implementation of subsection (h)(3), except 
        that compliance with the standards of an applicable 
        United States Pharmacopeia monograph is not dependent 
        on any further implementation under subsection (h)(3).
          Among other requirements, a bulk drug substance used 
        for compounding must have been manufactured in an 
        establishment that has registered under section 510 of 
        the Act. In addition to applying to domestic 
        manufacturing establishments, this requirement shall 
        also apply to foreign establishments, once the 
        requirement in section 801 of this Act, which requires 
        foreign establishments to register and list under 
        section 510 of the Act, becomes effective.
          In compliance with subsection (h)(1)(B)(I)(III), 
        pharmacists may retain each certificate of analysis 
        until the supply of such bulk drug substance has been 
        exhausted, and must record in the compounding record 
        the manufacturer, repackager (if any), and the lot 
        number of the bulk drug substance.
          The list published pursuant to subsection 
        (h)(1)(B)(iv) includes drug products that have been 
        withdrawn or removed from the market because the 
        finished drug product and/or a component thereof has 
        been found to be unsafe or not effective. The Federal 
        Register document that includes the list should briefly 
        describe the basis for the withdrawal or removal and 
        provide interested parties with an opportunity to 
        comment. The list should not include products that have 
        been withdrawn or removed solely because of 
        manufacturing issues.
          Interested parties should be allowed to petition, 
        under 21 CFR Sec. 10.30, to change the listing of a 
        particular drug product under subsection (h)(1)(B)(v) 
        should research and technology yield advances which 
        correct the compounding difficulties.
          Regarding subsection (h)(2)(B), until the State 
        agency of jurisdiction in which the pharmacy is located 
        enters into a memorandum of understanding (MOU) with 
        the Secretary or 180 days after the development of the 
        standard MOU, whichever comes first, the exemption 
        shall not apply if inordinate quantities of compounded 
        products are distributed outside of the State in which 
        the compounding pharmacy or physician is located. 
        ``Inordinate'' quantities means amounts typically 
        associated with ordinary commercial drug manufacturing.
          As required under subsection (h)(3), the Secretary 
        will be required to promulgate regulations limiting 
        compounding to drug substances that are components of 
        drug products approved by the Secretary and to other 
        drug substances as the Secretary may identify. It is 
        expected that the Secretary's regulations would allow 
        compounding with drug products, or the components of 
        drug products, that are lawfully distributed, including 
        drug products that are not new drugs under 21 U.S.C. 
        Sec. 321(p) and drug substances that authorized for use 
        under an effective Investigational New Drug application 
        (IND) protocol under 21 U.S.C. Sec. 355(I) and 21 CFR 
        Part 312. The FDA may, in development of the list for 
        other substances approved for compounding, consult with 
        pharmacy organizations and other interested parties, 
        beyond the United States Pharmacopeia.

                            V. Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, June 27, 1997.
Hon. James M. Jeffords,
Chairman, Committee on Labor and Human Resources, United States Senate, 
        Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 830, the Food and 
Drug Administration Modernization and Accountability Act of 
1997.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Anne Hunt.
            Sincerely,
                                         June E. O'Neill, Director.

S. 830--Food and Drug Administration Modernization and Accountability 
        Act of 1997

    Summary: S. 830 would reauthorize the Prescription Drug 
User Fee Act (PDUFA) of 1992, which empowers the Food and Drug 
Administration (FDA) to collect user fees from the 
pharmaceutical industry. The user fee program would be 
reauthorized, with some modifications, for an additional five 
years. The bill would also amend the Food, Drug and Cosmetic 
Act (FD&CA) and the Public Health Service Act to reform the 
FDA's regulatory and approval processes for drugs, biological 
products, devices, foods and animal drugs. One provision would 
grant a six-month extension of market exclusivity for 
pharmaceutical manufacturers who conduct pediatric studies on 
select prescription drugs.
    CBO estimates that enacting S. 830 would result in net 
additional discretionary spending of $63 million in 1998 and 
$445 million over the 1998-2002 period, assuming appropriation 
of the authorized amounts. Reauthorizing the user fee program 
would yield $601 million in offsetting collections over five 
years; these amounts would also be authorized to be spent, 
subject to appropriation. Extending market exclusivity for 
certain drugs would increase direct spending by $65 million 
over the 1998-2002 period.
    By preempting state and local laws that regulate 
nonprescription drugs differently than federal law, S. 830 
would impose an intergovernmental mandate as defined in the 
Unfunded Mandates Reform Act (UMRA). CBO estimates that 
compliance with this mandate would result in no significant 
costs for state and local governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 830 is shown in the following table. For 
the purposes of this estimate, CBO assumes that all amounts 
authorized in the bill would be appropriated by the start of 
each fiscal year and that outlays would follow the historical 
spending patterns for the FDA. The costs of this legislation 
fall within budget function 550 (Health).

                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                              1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION                                       
                                                                                                                
                                           Spending Under Current Law                                           
Estimated Authorizations:                                                                                       
    Authorization Level...................................      887      919      949      982    1,016    1,050
    Estimated Outlays.....................................      895      914      937      971    1,005    1,038
Collection of User Fees:                                                                                        
    Authorization Level...................................     -101        0        0        0        0        0
    Estimated Outlays.....................................     -101        0        0        0        0        0
Spending of User Fees:                                                                                          
    Authorization Level...................................      101        0        0        0        0        0
    Estimated Outlays.....................................      100       26        5        0        0        0
                                                                                                                
                                                Proposed Changes                                                
Estimated Authorizations:                                                                                       
    Authorization Level...................................        0       63       93      102       90       97
    Estimated Outlays.....................................        0       38       61       80       83       93
Collection of User Fees:                                                                                        
    Authorization Level...................................        0     -110     -116     -119     -128     -128
    Estimated Outlays.....................................        0     -110     -116     -119     -128     -128
Spending of User Fees:                                                                                          
    Authorization Level...................................        0      110      116      119      128      128
    Estimated Outlays.....................................        0      104      114      118      126      128
                                                                                                                
                                        SPENDING SUBJECT TO APPROPRIATION                                       
                                                                                                                
                                              Spending Under S. 830                                             
Estimated Authorizations:                                                                                       
    Authorization Level \1\...............................      887      982    1,042    1,084    1,106    1,147
    Estimated Outlays.....................................      895      952      998    1,051    1,088    1,131
Collection of User Fees:                                                                                        
    Authorization Level \1\...............................     -101     -110     -116     -119     -128     -128
    Estimated Outlays.....................................     -101     -110     -116     -119     -128     -128
Spending of User Fees:                                                                                          
    Authorization Level \1\...............................      101      110      116      119      128      128
    Estimated Outlays.....................................      100      130      119      118      126      128
                                                                                                                
                                                 DIRECT SPENDING                                                
Direct Spending:                                                                                                
    Estimated Budget Authority............................        0        0        7       18       28       11
    Estimated Outlays.....................................        0        0        7       18       28       11
----------------------------------------------------------------------------------------------------------------
\1\ The 1997 level is the amount appropriated for that year.                                                    

                           BASIS OF ESTIMATE

    Estimated authorizations: In addition to reauthorizing the 
user fee program, the bill would reform the FDA's approval and 
regulatory processes with the intent of accelerating product 
approvals and alleviating regulatory requirements. It would 
require the FDA to comply with statutory deadlines for 
reviewing new products. S. 830 would require the FDA, in 
coordination with the National Institutes of Health (NIH) and 
the Centers for Disease Control (CDC), to establish a program 
to provide information on treatment, detection, and prevention 
of serious diseases and onclinical trials currently studying 
these conditions. Other provisions would result in small budgetary 
savings.
    Enforced Deadlines for FDA Action on Submissions. The bill 
would require the Secretary to develop and publish in the 
Federal Register a plan bringing the FDA into compliance with 
the obligations and deadlines contained in the FD&CA and other 
relevant statutes. Among other objectives, the plan must bring 
the FDA into full compliance with the statutory review 
deadlines in the FD&CA by July 1, 1999. The plan must also 
ensure that the FDA eliminate any backlog of submissions by 
January 1, 2000. The agency would also be required to implement 
the FD&CA inspection and postmarket monitoring requirements by 
July 1, 1999.
    Assuming that the volume and quality standards for reviews 
were to remain constant, the FDA would require additional staff 
and resources to reduce review times significantly and 
eliminate the backlog of product submissions. Because S. 830 
would somewhat relax current FDA regulations, the number of 
product applications could increase, placing further demands on 
the agency's resources. CBO estimates that the additional 
personnel and resources necessary to meet the proposed 
deadlines would exceed any savings realized through regulatory 
relief offered by S. 830. This provision would cost the federal 
government an estimated $50 million in 1998 and $267 million 
over five years.
    Information Program on Clinical Trials. S. 830 would 
require the Director of the National Institutes of Health in 
coordination with the FDA and the Centers for Disease Control 
to establish a program to provide information on treatment, 
detection, and prevention of serious diseases and on clinical 
trials currently studying these conditions. This program would 
include establishing a database of all federally and privately 
funded clinical trials and a toll-free telephone information 
line available to health care providers, researchers, 
individuals with serious diseases, and all other members of the 
public.
    The NIH already has such a program for clinical trials that 
it funds for cancer, AIDS, and rare diseases. Privately funded 
clinical trials are also included in these databases on a 
voluntary basis. The FDA would be able to disclose information 
on clinical trials, and NIH would be required to expand its 
current database significantly to accommodate the increase in 
volume of trials and information. After the system was set up, 
additional maintenance costs would be incurred to keep up with 
the status and results of clinical trials, and with new 
protocols on treatment and prevention of serious diseases and 
conditions. Costs would also arise to operate a telephone 
information line staffed by health professionals.
    CBO based its estimate on the cost of maintaining the 
current data banks and information networks, the estimated 
portion of clinical trials currently contained in NIH's 
databases, and conversations with professionals experienced in 
this area. CBO assumes that it would take two years to create a 
system that would meet the minimum requirements specified in 
the bill, at a cost of $20 million in 1998 and $45 million in 
1999. For each year thereafter, CBO estimated a cost of $50 
million for maintenance and quality improvement. Costs would 
total $215 million over the 1998-2002 period.
    Third-Party Review of Applications. The FDA would be 
required to accredit independent entities and individuals to 
review and make initial classification recommendations on 
section 510(k) device submissions. Devices that are life-
sustaining or supporting, intended for implantation for more 
than one year, or designated as class III devices under section 
515 would be exempted from this provision, except at the 
agency's discretion. The FDA would also have the discretion to 
allow accredited entities and individuals review premarket 
approval (PMA) applications for class III devices. Compensation 
arrangements for these reviews would be made between the 
sponsor and the reviewer. CBO estimates that this proposal 
would save approximately $1 million over five years.
    Reclassification of Class III Devices. S. 830 would amend 
the FDA's current practice of automatically designating as 
class III products new devices that are not substantially 
equivalent to a legally marketed predicate device. Sponsors of 
devices designated as class III could request the FDA to 
classify their device as a class I or II device, and could make 
a recommendation about the classification. The FDA would have 
60 days to make a final determination on a sponsor's 
recommendation. This provision would reduce the number of 
premarket applications reviewed by the FDA, saving $1 million 
in 1998 and $12 million over five years.
    Reporting Product Changes to the FDA. The bill would waive 
the requirement that manufacturers file an additional 
application for an investigational device exemption for minor 
changes in the intended use or design of an investigational 
device. Minor changes are those that would not affect the 
efficacy or safety of the device. CBO estimates that this 
provision would save approximately $11 million over five years.

User fees

    The bill would reauthorize current prescription drug user 
fees through September 30, 2002. The current authorization 
expires at the end of fiscal year 1997. The bill would also 
authorize new fees to be levied on manufacturers and suppliers 
of food contact substances. Proceeds from these fees would be 
available for spending, subject to appropriation.
    Reauthorization of the Prescription Drug User Fee Act of 
1992. As with current law, the reauthorized program would levy 
three types of user fees on pharmaceutical manufacturers: 
application and supplement fees, establishment fees, and 
product fees. Aggregate amountsof such fees are specified in 
the bill for each of fiscal years 1998-2002; these amounts would be 
adjusted to reflect cumulative inflation since 1997. CBO's estimate 
assumes that the inflation adjustment would apply to the specified 
authorization, not to the prior year's actual authorization. Under the 
proposal, the FDA would make annual adjustments so that the total 
revenues collected for establishment and product fees would equal those 
for application and supplement fees. The amounts collected are 
authorized to be spent, subject to appropriation. CBO estimates that 
the FDA would collect $110 million in 1998 and $601 million over five 
years.
    Any fees collected in excess of the amount specified in the 
appropriations act for a given year would be credited to the 
FDA appropriations account and subtracted from the amount of 
fees authorized for the following year. The FDA could not 
assess the user fees unless appropriations for FDA salaries and 
expenses, excluding any user fees, were at least equal to 
appropriations for 1997, adjusted for inflation.
    Fees for Food Contact Substances. The bill would include 
food contact substances among the items regulated under the 
FD&CA. Food contact substance could be used only if the FDA 
issued, and the food contact substance met, standards for the 
use of such additives. Alternatively, manufacturers or 
suppliers could give the FDA advance notification that the 
intended use of their food contact substance was safe according 
to agency regulations. Unless the FDA determined that the food 
contact substance was unsafe within 120 days of this notice, 
the notification would become effective.
    The Secretary could authorize a fee, based on the resources 
needed to process these notifications, to be collected from 
individuals submitting notifications. The fee would be 
available to the FDA until expended, without fiscal year 
limitation. Although CBO cannot determine the amount of such 
fees, the provision would have no net budgetary impact, because 
the fees would be set to cover the agency's costs for reviewing 
and processing food contact substance notifications.

Direct spending

    The bill would grant an additional six months of market 
exclusivity to pharmaceutical manufacturers that conduct 
pediatric studies on select drugs. This provision would affect 
direct spending because it would increase costs for the 
Medicaid rebate program and the Federal Employees Health 
Benefit Program (FEHBP). This provision would apply to 
pediatric studies commenced before January 1, 2004.
    The Secretary of Health and Human Services, through the 
Commissioner of the FDA, would issue a list of drugs for which 
additional pediatric information might yield a health benefit.
    If manufacturers of targeted drugs submitted pediatric 
studies to the FDA, their product would receive an additional 
six months of market exclusivity. This benefit would accrue to 
both approved drugs and those awaiting approval. Manufacturers 
of an approved drug that received an extension under this 
provision could, if eligible, receive an additional six months 
of exclusivity for a supplemental application.
    By extending the market exclusivity of certain drugs, this 
proposal would increase prescription drug costs for Medicaid, 
FEHBP, Veterans Affairs (VA) facilities, the Department of 
Defense, and the Public Health Service for the six months of 
the extension. In the absence of this provision, these programs 
may have had access to less expensive generic products. In the 
case of Medicaid and FEHBP, the additional costs of this 
provision would represent direct spending. At this time, the 
costs to FEHBP, the VA, the Department of Defense, and the 
Public Health Service cannot be determined. CBO estimates that 
this provision would have no net budgetary effect in 1998 but 
would increase federal outlays for Medicaid by $65 million over 
the 1998-2002 period.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act of 1985 set up pay-as-you-go 
procedures for legislation affecting direct spending or 
receipts through 1998. CBO estimates that enactment of S. 830 
would have no significant effect on direct spending or receipts 
in 1998.

                    VI. Regulatory Impact Statement

    Estimated impact on State, local, and tribal governments: 
By preempting state and local laws that regulate 
nonprescription drugs differently than federal law, S. 830 
would impose an intergovernmental mandate as defined in UMRA. 
CBO estimates that compliance with this mandate would result in 
no significant costs for state and local governments. 
Consequently, the threshold established in UMRA ($50 million in 
1996, adjusted annually for inflation) would not be exceeded. 
This mandate would not affect tribal governments.
    By granting certain drug manufacturers a six-month 
extension of market exclusivity for their products, the bill 
would make prescription drugs provided under Medicaid more 
expensive. CBO estimates that states' share of these costs 
would total about $28 million over the next five years. This 
provision would not constitute a mandate under UMRA because 
prescription drugs under Medicaid are provided at a state's 
option.
    Estimated impact on the private sector: S. 830 would impose 
some new private-sector mandates and would replace some 
existing mandates with new, less burdensome requirements. In 
addition, the bill would reauthorize application fees and 
certain other fees paid by pharmaceutical companies. However, 
since these fees do not become effective until Congress 
appropriates them, they do not constitute a private-sector 
mandate. Thus, the direct cost of all private-sector mandates 
in this bill are minimal, and the total effect could be a net 
reduction in mandated costs imposed on the private sector.
    Sections 803 and 808 would impose new mandates on the 
private sector. Section 803 would change the definition of when 
a food, drug, device, or cosmetic intended for export is not 
deemed to be adulterated or misbranded in situations in which 
exportation is made to the original foreign supplier. This 
section also would impose a new mandate on persons seeking to 
export a condemned imported article by imposing a new 
certification requirement. Section 808 would direct the 
Secretary to establish ``a data bank of information on clinical 
trials for drugs, and biologicals, for serious or life-
threatening diseases and conditions.'' This provision would 
impose a new mandate on sponsors of such clinical trials by 
requiring them to forward to the data bank information about 
eligibility criteria for participation in the trial, the 
location of the trial, and a point of contact within 21 days 
after the clinical trial is approved by FDA. CBO estimates that 
the costs of these mandates would be minimal.
    Several new mandates would cost no more and perhaps less 
than the current regulatory requirements that they would 
replace. Section 601 would require manufacturers of medical 
devices to submit a written notice, rather than a supplemental 
application as currently required, for certain types of 
manufacturing changes. Section 619 would set new quality 
standards specifically for positron emission tomography drugs, 
but relieve them of the new drug application process (required 
under section 505 of the Food Drug and Cosmetic Act) and 
certain other regulations. Section 610 would establish a single 
licensing requirement for biological products that would 
replace current licensing requirements.
    Estimate prepared by: Federal cost: Anne Hunt (FDA) and 
Cyndi Dudzinski (NIH); impact on State, local, and tribal 
governments: John Patterson; and impact on the private sector: 
Anna Cook.
    Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                    VII. Section-by-Section Analysis

Sec. 1. Short Title.

    Section 1 provides that the act be cited as the ``Food and 
Drug Administration Modernization and Accountability Act of 
1997.''

Sec. 2. Table of Contents.

    Section 2 contains the table of contents.

Sec. 3. References.

    Section 3 states that whenever this Act provides for 
amendment to, or repeal of, a section or other provision, the 
referenced section or provision is of the Federal Food, Drug, 
and Cosmetic Act (FFDCA; 21 U.S.C. 321 et seq.)

                   title i--improving patient access

Sec. 101. Mission of the Food and Drug Administration.

    Section 101 amends FFDCA section 903 (21 U.S.C. 393) by 
redesignating subsections (b) and (c) as subsections (c) and 
(d) and adding IN GENERAL that the Administration shall protect 
the public health by ensuring that foods are safe, wholesome, 
and sanitary; human and veterinary drugs are safe and 
effective; there is a reasonable assurance of safety and 
effectiveness of devices intended for human use; cosmetics are 
safe and properly labeled; and the public health and safety are 
protected from electronic product radiation, and (2) SPECIAL 
RULES that require the Administration promptly and efficiently 
review clinical research and take appropriate action on the 
marketing of regulated products in a manner that does not 
unduly impede innovation or product availability. Further, the 
Administration shall participate with other countries to reduce 
the burden of regulation, to harmonize regulatory requirements, 
and to achieve appropriate reciprocal arrangements.

Sec. 102. Expedited Access to Investigative Therapies.

    Section 102 amends Chapter V (21 U.S.C. 351 et seq.) to add 
a new subchapter.

           subchapter d--unapproved therapies and diagnostics

Sec. 551. Expanded Access to Unapproved Therapies and Diagnostics.

    Section 102 of this Act creates a new section 551 of the 
FFDCA. Section 551(a) allows any person, acting through a state 
licensed physician, to request from manufacturers a product 
that is under investigation for the Food and Drug 
Administration's (FDA) approval for the diagnosis, monitoring, 
or treatment of a serious disease or condition or any other 
disease or condition designated by the Secretary as appropriate 
for access to such products. Expanded access is conditional on 
whether (1) a licensed physician determines that the person has 
no comparable or satisfactory alternative therapy; (2) the 
licensed physician determines that the risk to the patient from 
the investigational product is not greater than that of the 
risk from the disease or condition; (3) the Secretary 
determines that an investigational drug (IND) or 
investigational device (IDE) application complies with 
regulations governing these applications; (4) the Secretary 
determines that the manufacturer is diligently pursuing an 
approval; and (5) the Secretary decides that expanded access to 
an investigational product will not prevent adequate patient 
enrollment for ongoing clinical trials for the unapproved 
product. There is also to be a determination by FDA that there 
is sufficient evidence of safety and effectiveness such that 
the investigational product can be used in his manner.
    Section 551(b) allows a sponsor to submit one or more 
protocols for expanded access for an investigational product. 
The protocols may include any use of the drug or device outside 
a clinical investigation prior to approval for marketing, 
including treatment use, single patient use, emergency use, and 
uncontrolled trials. The Secretary may waive certain 
requirements for expanded access to investigational new 
products for use by a single patient only in an emergency when 
times does not permit an application to be filed for an 
exemption. The Secretary can authorize shipment and use of the 
product in advance of any submission.
    Section 551(c) allows the Secretary to inform national, 
state, and local medical associations and societies, and other 
appropriate organizations and persons about the availability of 
the investigational drugs or devices under expanded access 
protocols. However, this does not apply to protocols for single 
patient use. Sec. 551(d) allows the Secretary at any time to 
stop expanded access if the drugsor devices do not meet the 
requirements set forth in this section.

Sec. 103. Expanded Humanitarian Use of Devices.

    Section 103 amends section 520(m) (21 U.S.C 360j(m)) 
(Humanitarian Device Exemption section) formalizing requests 
for exemption from device efficacy studies intended for patient 
populations of less than 4,000. Requests would now be in the 
form of an application that the Secretary must approve or deny 
within 60 days. This section amends section 520(m)(4)(B) to 
allow a physician, if he had not received a timely response 
from a hospital institutional review committee (IRC) to which 
the physician had applied for an exemption, to use the device 
if the patient would suffer harm or death waiting for IRC 
approval. The physician will then be required to inform the 
chairperson of the IRC of such a use on a particular patient, 
the date used, and why it was necessary. New section 520(m)(5) 
allows the Secretary to require a recipient of an exemption to 
demonstrate continued compliance with requirements if the 
Secretary deems this necessary to protect the public health or 
believes that the criteria for the exemption are no longer met.

         title ii--increasing access to expertise and resources

Sec. 201. Interagency Collaboration.

    Section 201 amends section 903(b) (21 U.S.C 393(b)) of the 
FFDCA to require that the Secretary create programs to foster 
collaboration among science-based federal agencies such as the 
National Institutes of Health (NIH) and others to enhance the 
scientific and technical expertise available to product 
reviewers. This expertise will be available for review 
activities for medical therapies such as the development, 
clinical investigation, evaluation, and postmarket monitoring 
of emerging therapies. It will also cover complementary 
therapies and advances in nutrition and food science.

Sec. 202. Sense of the Committee Regarding Mutual Recognition 
        Agreements and Global Harmonization Efforts.

    Section 202 gives the sense of the Senate Committee on 
Labor and Human Resources that the Secretary should consult 
with the Secretary of Commerce and support the Office of the 
U.S. Trade Representative in moving toward acceptance of mutual 
recognition agreements (MRAs) with the European Union. These 
MRAs will cover the regulation of drugs, biological products, 
devices, foods, food additives, and color additives as well as 
good manufacturing practices. The Secretary should regularly 
participate in meetings with other foreign governments to 
harmonize regulatory requirements. The Committee also would 
like to ensure that the Department of Health and Human 
Services, Office of International Relations (established in 
section 803 of the FFDCA) continuously works towards 
harmonizing international regulatory requirements.

Sec. 203. Contracts for Expert Review.

    Section 203 amends Chapter IX (21 U.S.C 391 et seq.) by 
adding a new section on contracts for expert review. Under new 
section 906, the Secretary will be authorized to enter into 
contracts with qualified nongovernmental individuals or 
organizations to make recommendations to the Secretary on any 
applications or submissions for approval or classification 
under FFDCA or under section 351(a) of the Public Health 
Service Act (42 U.S.C 262(a)) for biological products. All such 
contracts will be subject to requirements under section 708 of 
the FFDCA relating to confidentiality of information.
    The Secretary shall use this authority to enter into 
contracts with individuals or organizations to review 
applications or submissions whenever the Secretary determines 
that such reviews will improve the timeliness or quality of the 
application under review. The official at the FDA who is 
responsible for the matter that the contractor is reviewing 
must make final decisions on the contractors' recommendations 
within 60 days. The Secretary shall retain authority to approve 
or disapprove submissions for a product, or to classify an 
article as a device under section 513(f)(1).

Sec. 204. Accredited-Party Participation.

    Section 204 amends Subchapter A of Chapter V (21 U.S.C. 351 
et seq.) of the FFDCA to establish new section 523--Accredited-
Party Participation. This section requires the Secretary to 
accredit nongovernmental individuals or entities to make 
recommendations for initial classification of and to review 
premarket notification for medical devices. Devices that are 
long-term implantable, life-sustaining, or life-supporting will 
be excluded from accredited-party review.
    Under subsection 523 of the new law, the Secretary will 
have discretion to accredit nongovernmental groups or parties 
to (a) review premarket notification reports for devices (under 
section 510(k)) and make recommendations for their initial 
classification, or (b) to review premarket approval 
applications (under section 515) and make recommendations for 
their approval or disapproval.
    Within 180 days of enactment, the Secretary must establish 
the accreditation process for third-party medical device 
review. The accreditation process must be published in the 
Federal Register. If an accredited party fails to comply with 
duties published by the Secretary, such as avoidance of 
conflicts of interest or protection of confidential 
information, the Secretary may, after giving notice and 
opportunity for a hearing, suspend or withdraw program 
accreditation from that party.
    Device sponsors who are considering filing a premarket 
notification or a premarket approval application, as described 
in subsection (2), will be given the option of selecting an 
accredited entity. Upon request, the Secretary must provide the 
device sponsor with a minimum of two accredited parties from 
which to choose. Compensation must be arranged between the 
sponsor and the accredited party.
    The Secretary must require accredited parties to submit 
their recommendations and supporting rationale in writing. For 
initial classification of a device, the Secretary must make a 
final decision within 30 days of receiving the recommendation. 
For premarket approval applications, the Secretary will have 
authority to change recommendations that an accredited party 
proposes, and must provide the party submitting the application 
or report with a written explanation of the reasons for the 
change.
    The program for third-party accreditation is authorized to 
operate for a period of either five years following the date on 
which at least two accredited parties are available to review 
devices ``in each of at least 70 percent of generic types of 
devices required for review under subsection (a)''; or, four 
years after the date on which the Secretary notifies Congress 
that the Secretary has acted upon at least 35 percent of the 
devices under subsection (a) for classification or review, 
whichever occurs first.
    Within one year of enactment, the Secretary must contract 
with an independent research organization to prepare and submit 
a written report examining the use of accredited-parties to 
review notifications of and applications for medical devices. 
The Secretary must submit the report to Congress no later than 
six months from the date when the accredited program concludes. 
The report must contain a description of the benefits or 
detriments to public health of using accredited parties to 
conduct those reviews. The report must contain a summary of all 
relevant data, including review times, compensation, and 
recommendations made by the accredited party and the Secretary.

Sec. 205. Device Performance Standards.

    Section 205 amends section 514 (21 U.S.C. 360(d)) of the 
FFDCA by adding a new section for ``Recognition of a 
Standard.'' Section 205 authorizes the Secretary to recognize 
in the Federal Register nationally or internationally 
recognized standards. Such standards may be used to meet 
requirements for premarket submissions or other requirements of 
the Act. If a regulated person uses a recognized standard then 
that person must provide the Secretary with a declaration of 
conformity certifying that the device conforms with the 
recognized standard. When the recognized standard is no longer 
appropriate for satisfying requirements under the Act, the 
Secretary may withdraw recognition of that standard.
    The Secretary must accept self-declarations from sponsors 
that a device conforms with a recognized standard unless the 
Secretary finds that (a) the data submitted to support 
conformity is not consistent with the standard identified in 
the self-declaration of conformity, or (b) the standard 
identified in the declaration of conformity does not apply to 
the device under review. The Secretary may request a device 
sponsor to submit the data that was relied on to make a self-
declaration of conformity. Device sponsors who make self-
declarations of conformity for a recognized standard must 
maintain data and information that supports conformity of the 
device to the standard for a period of two years after the date 
of classification or approval of the device, or for a period 
equal to the life expectancy of the device, whichever is 
longer.
    Section 301 (21 U.S.C. 331) will be amended to prohibit the 
falsification of a declaration of conformity or the failure or 
refusal to provide data or information that the Secretary may 
request under new section 514(c)(3).
    Section 501 (21 U.S.C. 351(c)) will be amended to reflect a 
new condition under which a device is adulterated. A device 
would be adulterated if it is falsely declared to be in 
conformity with recognized performance standards under section 
514(c).

         title iii--improving collaboration and communications

Sec. 301. Collaborative Determination of Device Data Requirements.

    Section 301 amends section 513(a)(3) (21 U.S.C. 360c(a)(3)) 
of the FFDCA. Upon written request from a device sponsor, the 
Secretary will be required to meet to determine the type of 
scientific evidence that is necessary to demonstrate the 
effectiveness of a device. It is proposed that such meetings 
between the Secretary and device sponsors take place before 
clinical trials begin or before an investigation device 
exemption is filed. Within 30 days after the meeting, the 
Secretary must specify the type of scientific evidence the 
sponsor will need to support the proposed use of the device. 
For any clinical data that the Secretary may require, the 
Secretary must provide a written specification to the device 
sponsor that reflects the Secretary's view that such data are 
necessary to establish the effectiveness of the device, and 
that a less burdensome means is not available. The Secretary's 
specification for scientific evidence will be binding upon the 
Secretary, unless he finds that (a) it is not in the interest 
of the public health to modify the specification, or (b) 
scientific evidence obtained during consideration of an 
investigational device exemption makes the specification 
inappropriate.

Sec. 302. Collaborative Review Process.

    Section 302 amends section 515(d) (21 U.S.C. 360e(d)) of 
the FFDCA. Within 100 days of receiving a complete premarket 
approval application (PMA), the Secretary will be required to 
meet the device sponsor to discuss the status of review, if so 
requested in writing. If the PMA does not appear in a form that 
will require an approval, the Secretary must indicate in 
writing before the meeting any deficiencies that the device 
sponsor must correct and information the device sponsor must 
provide to bring the application to an approvable form. The 
Secretary and the device sponsor may mutually agree on a 
different meeting schedule.

           title iv--improving certainty and clarity of rules

Sec. 401. Policy Statements.

    Section 401 amends current section 701 (General Authority) 
(21 U.S.C. 371(a)). After a two year evaluation period, the 
Secretary, by February 27, 1999, a recently issued guidance 
document for ``Good Guidance Practices'' (62 Federal Register 
8961) into a regulation.

Sec. 402. Product Classification.

    Section 402 amends chapter VII (21 U.S.C. 371 et seq.) of 
the Act to add a new ``Subchapter D--Review of Applications and 
Environmental Impact Reviews.'' Under new section 741, a 
product sponsor for a drug, biological product, or device may 
submit certain recommendations to the Secretary along with an 
application for premarket review. Those recommendations may 
call for a classification determination as well as a center-
specific review. The Secretary will have a total of 60 days to 
(a) classify the product, or (b) assign it to a center for 
review, and (c) inform the sponsor of the reasons for the 
Secretary's decisions. The Secretary will be bound by these 
decisions except for public health reasons or with the written 
consent of the sponsor. If the Secretary does not make a 
decision within 60 days, the sponsor's recommendations for 
classification or assignment will be final.

Sec. 403. Use of Data Relating to Premarket Approval.

    Section 403 amends current section 520(h)(4) (21 U.S.C. 
360j(h)(4)). The Secretary is authorized to use data from a 
premarket approval application six years after an application 
is approved for the purpose of facilitating reclassification 
and/or approval of applications submitted by other device 
sponsors for the same kind of device. The publicly available 
detailed safety and effectiveness summaries required to be 
submitted for premarket approval shall be available for use by 
the Secretary as the evidentiary basis for any action based on 
the data.

Sec. 404. Consideration of Labeling Claims for Product Review.

    Section 404 amends section 515(d)(1)(a) (21 U.S.C. 
360e(d)(1)(A)) and section 513(i)(1) for labeling claims for 
premarket approval applications under premarket notifications. 
In making determinations to approve or deny an application, the 
Secretary will be required to limit the evaluation of safety 
and effectiveness to those uses proposed in the product label 
if it is determined that the labeling is neither false nor 
misleading. For products claiming substantial equivalence with 
others having different technological characteristics, the 
Secretary will be required to request only that information 
that is necessary and corresponds to the least burdensome means 
of demonstration. The Secretary must also base this finding 
only on the intended uses in the proposed labeling in a report 
submitted under section 510(k).

Sec. 405. Definition of a Day for Purposes of Product Review.

    Section 405 amends section 201 (21 U.S.C. 321). A calendar 
day is described as one in which the Secretary has 
responsibility to review a new product. Any day during which a 
product sponsor for a drug, device, biological product, new 
animal drug, color additive, or food additive is responding to 
Secretary requests for information from the Secretary will be 
excluded. A reference to a date relating to the receipt of 
filing of such an application means the date when the Secretary 
receives or files, as appropriate, a complete application.

Sec. 406. Certainty of Review Timeframes.

    Section 406 amends section 510(k) (21 U.S.C. 360) to state 
that the Secretary must review premarket notifications within 
90 days. This new requirement will conform with current 
practice in reporting on review timeframes for 510(k) 
submissions. This section will also amend section 515(d) (21 
U.S.C. 360e(d)) to ensure that the Secretary must review 
applications within 180 days even if the application is 
amended.

Sec. 407. Limitations on Initial Classification Determinations.

    Section 407 amends section 510 (21 U.S.C. 360). The 
Secretary will be prohibited from the current practice of 
withholding the initial classification of a device because of a 
failure of a manufacturer to comply with any provision of the 
FFDCA unrelated to making a determination of substantial 
equivalence, including good manufacturing practice regulations.

Sec. 408. Clarification of General and Specific Uses of A Device For 
        Purposes of Substantial Equivalence.

    Section 408 will require issuance of a new regulation. 
Within 270 days of enactment, the Secretary must promulgate 
final regulations establishing criteria that will be considered 
when evaluating claims for substantial equivalence under 
section 513(f)(1) (21 U.S.C. 360(f)(1)). The Secretary must 
develop criteria to determine when the specific intended use of 
a device is not reasonably included within its general use.

Sec. 409. Clarification of the Number of Required Clinical 
        Investigations.

    Section 409 amends current sections 505(d) (21 U.S.C. 
355(d)) and 513(a)(3)(A) (21 U.S.C. 360c(a)(3)(A)) adding a new 
sentence to 505(d) giving the Secretary discretion to approve 
drugs under certain conditions on the basis of one adequate and 
well-controlled investigation with confirmatory evidence, and 
by changing ``clinical investigations'' in 513(3)(a) to ``1 or 
more clinical investigations.''

Sec. 410. Prohibited Acts.

    Section 410 will repeal section 310(1) (21 U.S.C. 331(l)) 
of current law. The section of the FFDCA that prohibits 
manufacturers from making truthful statement of facts about 
Secretary-approved products will be repealed.

                   title v--improving accountability

Sec. 501. Agency Plan for Statutory Compliance and Annual Report.

    Section 501 amends Section 903(b) (21 U.S.C. 393(b)) of the 
FFDCA to create two new subsections 903(b)(4) Agency Plan for 
Statutory Compliance and 903(b)(5) Annual Report. The Committee 
does not intend to duplicate any requirement of current law 
that applies under the Government Performance and Results Act 
(GPRA) [P.L. 103-62].
    New section 903(b)(4) will require that the Secretary, not 
later than 180 days after enactment, develop a plan to bring 
the Secretary into compliance with each of the FFDCA's 
obligations. The plan will be developed after consultation with 
experts, health care professionals, representatives of patients 
and consumer advocacy groups, and regulated industries. The 
plan must be published in the Federal Register and will be 
reviewed biannually by the Secretary for revisions as 
necessary. The plan's objectives will be to (i) minimize deaths 
and injuries suffered by persons who may use products regulated 
under the FFDCA; (ii) maximize the clarity and availability of 
information about the product review process and new products 
for potential consumers and patients; (iii) implement all 
inspection and post-market monitoring provisions of the Act by 
July 1, 1999; (iv) ensure access to the scientific and 
technical expertise necessary to properly review products; (v) 
establish a schedule to bring the ``Administration'' into 
compliance by July 1, 1999 with the product review times in the 
Act for products submitted after the date of enactment of this 
section; and (vi) eliminate the backlog of products awaiting 
final action by January 1, 2000.
    New section 930(b)(5)(A) will require that the Secretary 
solicit public comment by publishing in the Federal Register an 
annual report that would: (i) contain statistical information 
on the performance of the Secretary to assist Congress in 
assessing his performance; (ii) compare the Secretary's 
performance in that year to the plan and Secretary's statutory 
obligations; (iii) analyze any failure to achieve any element 
of the agency plan; (iv) identify any regulatory policy that 
has a significant impact on compliance with any objective of 
the agency plan or any statutory obligation; and (v) set forth 
any proposed revision to any such regulatory policy, or 
objective of the plan, that has not been met.
    New section 903(b)(5)(B) will require that the information 
given annually will include statistics on all applications and 
submissions made under the FFDCA and approved or subject to 
final action by the Secretary during that year. The statistical 
information will consider the date of: (1) the submission of 
any investigational application; (ii) the application of any 
clinical hold; (iii) the number of applications submitted for 
approval or clearance; (iv) the acceptance for filing of any 
application; (v) the occurrence of any unapprovable action; 
(vi) the occurrence of any approvable action; and (vii) the 
approval or clearance of any application or submission 
described in (iii).

     title vi--better allocation of resources by setting priorities

Sec. 601. Minor Modifications.

    Section 601 amends Section 520(g) (21 U.S.C. 360j(g)) of 
the FFDCA to require the Secretary, within 120 days of 
enactment, to issue new regulations modifying parts 812 and 813 
of Title 21, Code of Federal Regulations, updating procedures 
and conditions for granting exemptions, and governing, when the 
manufacturer of a device, which is the subject of an approved 
investigational device exemption, may make minor modifications 
to that device without restarting the clinical trial or 
submitting a supplement to the investigational device exemption 
in effect for the clinical trial.
    The new regulations must permit developmental changes in 
devices (including manufacturing changes) in response to 
information collected during the investigation, without 
requiring an additional investigational device exemption 
approval or the approval of a supplement, as long as the 
sponsor determines, prior to making the changes, that they will 
not affect the soundness of the investigational plan or the 
rights, safety, or welfare of the human subjects involved. 
Also, the changes must not constitute a significant change in 
the design or basic operational principles of the device. In 
reviewing an application, FDA is required to accept and review 
data or information to determine whether there is a reasonable 
assurance of safety and effectiveness of the device if: (I) the 
data or information are derived from investigations of a 
previously approved device, the device has been modified during 
or after the investigations, and the modification does not 
constitute a significant change in the device's design or basic 
operational principles; or(II) the data or information relating 
to the device are available for use under the Act, and are relevant to 
the design and intended use of the device subject to the pending 
application.
    Supplemental applications will be required for any changes 
to a marketed device that affect safety and efficacy. This will 
not be required if the change is a modification in a 
manufacturing method or procedure and the holder of the 
application submits a written notice describing the change in 
detail, summarizing the data or information supporting the 
change, and informing the Secretary that, despite the change, 
the manufacturer is still in compliance with the FDA's good 
manufacturing practices (GMP) regulations. Holders of approved 
applications who submit manufacturing change notifications may 
not distribute their products until 14 days after the Secretary 
has been notified.
    When reviewing a supplement to an approved application for 
an incremental change to the design of a device that affects 
safety or effectiveness, the Secretary must approve the 
supplement if non-clinical data show that the modification 
creates the intended additional capacity, function, or 
performance of the device, and the clinical data from the 
approved application, and any of its supplements, provide a 
reasonable assurance of safety and efficacy.

Sec. 602. Environmental Impact Review.

    Section 602 amends Chapter VII (21 U.S.C. 371) of the 
FFDCA, adding new section 742 dealing with environmental impact 
reviews. The section establishes that no action taken by the 
Secretary under this law shall be subject to an environmental 
impact assessment, an environmental impact statement, or other 
environmental consideration unless the Secretary demonstrates, 
in writing, that (1) there is a reasonable probability that the 
environmental impact of the action is substantial and within 
the factors the Secretary is authorized to consider, and (2) 
that consideration of the impact will directly affect the 
decision on the action.

Sec. 603. Exemption of Certain Class Devices From Premarket 
        Notification Requirement.

    Section 603 amends Section 510(k) (21 U.S.C. 360(k)) of the 
FFDCA, establishing that all Class I devices, except those that 
are intended for a use that is of substantial importance in 
preventing impairment of human health, or present a potential 
unreasonable risk of illness or injury, are exempted from pre-
market review. The FDA's enforcement powers and good 
manufacturing practices will still apply to these devices. In 
addition, the Secretary must, no later than 30 days after 
enactment, publish a list of each type of Class II device that 
does not require pre-market review. One day after the list is 
published, a class II device, based on the Secretary's 
initiative or upon the petition of an interested person, may be 
exempted from the pre-market notification requirement. The 
petition, or the Secretary's intent to exempt such a device, 
must be published in the Federal Register and allow for a 30 
day public comment period. Within 120 days of the Federal 
Register notice, an order must be published setting forth the 
Secretary's final determination about the device's exemption.

Sec. 604. Evaluation of Automatic Class III Designation.

    Section 604 amends Section 513(f) (21 U.S.C. 360c(f)) of 
the FFDCA to establish that any device manufacturer who submits 
a report under section 510(k) for review of a type of device 
that has not been previously classified under the Act, and 
which is classified into Class III, may request, within 30 days 
of receiving the notification, that the Secretary classify the 
device into either Class I or II. In the request, the 
manufacturer may recommend to the Secretary the device's 
classification. The request must include a description of the 
device, and detailed information and reasons for its 
reclassification.
    Not later than 60 days after a classification request, the 
Secretary, by written order, must classify the device. This 
classification will be the initial classification of the 
device, and any device classified into Class I or II shall be a 
predicate device for determining substantial equivalence. Any 
device that remains in class III will be deemed adulterated 
until it is either approved under section 515 or exempted from 
such approval under section 520(g). Once an order classifying a 
device is issued, the Secretary must, within 30 days, publish 
its announcement in the Federal Register.

Sec. 605. Discretion To Track Devices.

    Section 605 amends Section 519(e) (21 U.S.C. 360i(c)) of 
the FFDCA, establishing that any patient who receives a device, 
subject to tracking under this section, may refuse to release, 
or refuse permission to release, their name, address, social 
security number, or other identifying information used for 
tracking purposes. Within 180 days of enactment, the Secretary 
must develop and publish in theFederal Register a list 
identifying devices that require tracking under the Act. Devices not 
identified by the Secretary will be considered exempt from mandatory 
tracking. The Secretary will have the authority to modify the list of 
devices exempt from the mandatory tracking.

Sec. 606. Secretary's Discretion To Require Postmarket Surveillance.

    Section 606 amends Section 522 (21 U.S.C. 3601) of the 
FFDCA, establishing certain limitations on FDA's post-market 
surveillance authority for devices. This section stipulates 
that each device manufacturer, required to conduct post-market 
surveillance must, within 30 days of receiving a notice that 
surveillance is required, submit a surveillance plan for the 
Secretary's approval. Within 60 days of receipt of the plan, 
the Secretary must determine if the person who is to conduct 
the surveillance is qualified and experienced and whether the 
plan will result in the collection of useful data that can 
reveal unforeseen adverse events necessary to protect the 
public health and provide additional safety and effectiveness 
information.
    The Secretary may not approve the plan until it has been 
reviewed by a scientifically qualified review committee, which 
the Secretary is authorized to select. Manufacturers will be 
required to conduct surveillance for no more than 24 months. 
However, if the Secretary determines that additional 
surveillance is necessary to further explore unforeseen adverse 
events documented during the initial surveillance, the time 
period may be extended, and the person conducting the 
surveillance will be given an opportunity for an informal 
hearing to determine whether the additional surveillance time 
is appropriate.

Sec. 607. Reporting.

    Section 607 amends Section 519 (21 U.S.C. 360i) of the 
FFDCA, repealing certain reporting requirements for device 
distributors. However, it establishes that regulations shall 
require distributors, including importers, to keep records and 
make them available to the Secretary upon request. In addition, 
the provision adds new language to section 510 of the FFDCA 
(Registration of producers of Drugs and Devices) that will 
exempt wholesale distributors of devices, who do not 
manufacturer, repackage, process, or relabel, from the Act's 
registration requirements.

Sec. 608. Pilot and Small-Scale Manufacture.

    Section 608 amends Section 505(c) (21 U.S.C. 355(c)) of the 
FFDCA to establish that a new drug manufactured in a pilot or 
small facility may be used to demonstrate the drug's safety and 
effectiveness and to obtain its approval prior to scaling up to 
a larger facility. The Secretary retains the authority to 
determine whether a full scale production facility is necessary 
to ensure the drug's safety and effectiveness.

Sec. 609. Requirements For Radiopharmaceuticals.

    Section 609 requires the Secretary, within 180 days of 
enactment, and after consultation with patient advocacy groups, 
associations, physicians licensed to use radiopharmaceuticals, 
and the regulated industry, to issue proposed regulations 
governing the approval of radiopharmaceuticals designed for 
diagnosis and monitoring of diseases and conditions. The 
regulations must provide that the product's safety and 
effectiveness, governed under section 505 of the FFDCA and 
section 351 of the Public Health Service Act, must include (but 
not be limited to) consideration of the product's proposed use 
in the practice of medicine, the product's pharmacological and 
toxicological activity (including any carrier or ligand of the 
radiopharmaceutical), and the product's estimated absorbed 
radiation dose.
    Within 18 months of enactment, the Secretary must issue 
final regulations governing the approval of 
radiopharmaceuticals. This section establishes a ``SPECIAL 
RULE'' stating that in the case of a radiopharmaceutical 
intended to be used for diagnostic or monitoring purposes, its 
approved marketing indications may, in appropriate situations, 
refer to manifestations of disease (such as biochemical, 
physiological, anatomic, or pathological processes) common to 
or present in one or more disease states. The term 
``radiopharmaceutical'' is defined to mean an article: (A) 
intended for use in the diagnosis or monitoring of a disease or 
a manifestation of a disease in humans; and (B) which exhibits 
spontaneous disintegration of unstable nuclei with the emission 
of nuclear particles or photons; or any nonradioactive reagent 
kit or nuclide generator which is intended to be used in its 
preparation.

Sec. 610. Modernization of Regulation of Biological Products.

    Section 610 amends section 351(a) of the Public Health 
Service Act (PHSA) (42 U.S.C. 262(a)), to codify the regulation 
of biological products. It states that a biological product may 
not be introduced into interstate commerce unless (A) the 
product has a biologics license; and (B) the package is marked 
with the product's name, the manufacturer's name, address, and 
license number, and the product's expiration date. By 
regulation, the Secretary must establish requirements for the 
approval, suspension, and revocation of biologics licenses. A 
license will be approved based on a demonstration that the 
biological product is safe, pure, and potent, and that the 
facility where the product is manufactured, processed, packed, 
or held meets standards to assure its continued safety, purity, 
and potency. Also, the application will be approved only on the 
condition that the licensee agrees to permit inspection of its 
production facility. The Secretary must prescribe certain 
licensing and labeling exemptions for products undergoing 
investigation.
    The section amends section 351 of the PHSA eliminating the 
requirement that biologics manufacturers obtain establishment 
licenses, and redefines biological product to mean: ``a virus, 
therapeutic serum, toxin, antitoxin, vaccine, blood, blood 
component or derivative, allergenic product, analogous product, 
or arsphenamine or its derivatives (or any other trivalent 
organic arsenic compound) applicable to the prevention, 
treatment, or cure of diseases or conditions of human beings.''
    In addition, the section establishes a ``SPECIAL RULE'' 
directing the Secretary to take steps necessary to minimize 
differences in the review and approval of products required to 
have both a biologic license application under section 351 of 
the PHSA and a new drug application (NDA) under section 
505(b)(1) of the FFDCA.

Sec. 611. Approval of Supplemental Applications for Approved Products.

    This section states that within 180 days of enactment, the 
Secretary must publish in the Federal Register performance 
standards for the prompt review of supplemental applications 
for drugs previously approved under the Act. Within this same 
timeframe, the Secretary must also issue final guidance to 
clarify the requirements and facilitate the submission of data 
to support the approval of the supplemental application. The 
guidance must: (1) clarify the circumstances that will permit 
published material to qualify as the basis for approval; (2) 
specify data requirements that will avoid duplication by 
recognizing the availability of data previously submitted; and 
(3) define supplemental applications that are eligible for 
priority review.
    The Secretary must designate someone in each FDA Center 
(except the Center for Food Safety and Applied Nutrition) who 
will be responsible for encouraging prompt review of 
supplemental applications, and who will work with sponsors to 
facilitate the development of and data to support supplemental 
applications. In addition, the Secretary must implement 
programs and policies that will foster collaboration between 
FDA, NIH, professional medical and scientific societies, and 
others to identify published and unpublished studies that could 
support a supplemental application. Moreover, the Secretary 
must encourage sponsors to submit supplemental applications or 
conduct further research based on these studies.

Sec. 612. Health Care Economic Information.

    Section 612 amends Section 502 (21 U.S.C. 352) of the 
FFDCA, which specifies the circumstances whereby drugs and 
devices may be deemed ``misbranded,'' by adding language to 
deal with pharmacoeconomic health care claims. It establishes 
that a drug or device, about which a health care economic 
statement may be included in its labeling or advertising 
submitted to a formulary committee, managed care organization, 
or similar entity with drug selection responsibilities, will be 
considered misbranded if the economic statement is not based on 
``competent and reliable'' scientific evidence.
    The bill states that any such economic statements will be 
subject to section 502 only, and defines ``health care economic 
statement'' as ``any statement that identifies, measures, or 
compares the costs (direct, indirect, or intangible) and health 
care consequences of a drug to another drug or to another 
health care intervention for the same indication, or to no 
intervention, where the primary endpoint is an economic 
outcome.''

Sec. 613. Expediting Study and Approval of Fast Track Drugs.

    Section 613 amends Chapter V (21 U.S.C. 351) of the FFDCA, 
establishing a new Section 561 under new Subchapter E--Fast 
Track Drugs. The bill states that the Secretary will facilitate 
development and expedite approval of new drugs and biological 
products, to be known as ``fast track drugs,'' that are 
intended for treating serious and life-threatening conditions 
and show potential to address unmet medical needs. Drug 
sponsors may request that the Secretary designate drugs for 
fast track consideration, and the designation may be made 
concurrently with, or at any time after, the submission of the 
investigation application. Within 30 days of the request, the 
Secretary will determine if the drug meets the fast track 
criteria, and if so, will designate the drug and take action to 
expedite its development and review.
    The Secretary may approve a fast track drug based on a 
determination that the drug has an effect on a surrogate 
endpoint that is reasonably likely to predict clinical benefit. 
Such an approval may obligate the manufacturer to (i) conduct 
post-approval studies to validate the surrogate endpoint and 
confirm its clinical benefit; and (ii) submit copies of all 
promotional materials related to the fast tack drug during the 
preapproval review period and, following approval, at least 30 
days prior to the dissemination of the materials for such a 
time as the Secretary finds appropriate.
    The approval of a fast track drug may be withdrawn using 
expedited procedures, including an opportunity for informal 
hearing, if the sponsor fails to diligently conduct the post-
approval studies; a post-approval study fails to verify a 
clinical benefit; other evidence demonstrates that the drug is 
not safe or effective under its conditions of use; or the 
manufacturer disseminates false for misleading promotional 
materials.
    This provision also provides for the review of incomplete 
applications for the approval of fast track drugs. If early 
evaluation of clinical data for a fast track drug shows 
evidence of effectiveness, the Secretary will evaluate for 
filing and may commence review of portions of an application if 
the sponsor provides a schedule for submitting the information 
necessary for a complete application and any required user fee. 
In situations where the fast track drug's application is 
incomplete, the time periods for review of human drug 
applications agreed to in section 736 [drug user fee authority] 
will not apply until a completed application is submitted.
    The Secretary must develop and widely distribute to 
physicians, patient organizations, pharmaceutical and 
biotechnology companies, a comprehensive description of the 
provisions applicable to fast track drugs, and establish an 
ongoing program to encourage the development of surrogate 
endpoints that are reasonably likely to predict clinical 
benefit. Within 1 year of enactment the Secretary must issue 
guidance that describes the EPA's policies and procedures 
required to implement this provision.

Sec. 614. Manufacturing Changes For Drugs and Biologics.

    Section 614 amends Chapter VII (21 U.S.C. 371) of the 
FFDCA, establishing new Section 751 under new Subchapter E--
Manufacturing Changes. It describes the types of manufacturing 
changes the manufacturer of a new drug or biologic may make 
under the Act.
    Before distributing a new drug or biologic made after a 
change in the manufacturing process established in its original 
application, the sponsor must validate the effect of the change 
on the product's identity, strength, quality, purity, and 
potency--as they may relate to its safety and effectiveness. 
Changes needing validation must be reported to the Secretary, 
and the manufacturer may distribute the drug after a change is 
made as follows: (A) Major manufacturing changes, determined by 
the Secretary to have a substantial potential to adversely 
affect identity, strength, quality, purity, and potency as they 
may relate to safety and effectiveness, must be submitted in a 
supplemental application. Drugs made after these changes may 
not be distributed until the Secretary approves the supplement. 
Major manufacturing changes means: (1) changes in the 
qualificative or quantitive formulation or specifications; (2) 
changes the Secretary determines require an appropriate human 
study; and (3) changes which the Secretary determines have a 
substantial potential to have an adverse effect on the drug's 
safety or effectiveness; (B) As determined by the Secretary, 
manufacturing changes other than major changes, can be made at 
any time and must be reported annually with supporting data, or 
be reported in a supplemental application. Drugs having 
undergone a minor manufacturing change may be distributed 30 
days after the Secretary receives a supplemental application, 
unless the applicant is notified that prior approval of the 
supplement is required. After notification to the applicant, 
the Secretary must approve or disapprove each supplement. The 
bill proposes a ``SPECIAL RULE'' that allows the Secretary to 
determine the types of manufacturing changes after which 
distribution of the drug may begin whenthe supplement is 
submitted. A period for transition from prior requirements is defined.

Sec. 615. Data Requirements for Drugs and Biologics.

    Section 615 requires the Secretary through the Commissioner 
of FDA, within 1 year of enactment, to issue guidance that 
describes when manufacturers will be permitted to submit 
certain abbreviated study reports instead of traditional full 
reports with their new drug applications (NDAs). The guidance 
must describe when abbreviated reports are appropriate and what 
their format should be.

Sec. 616. Food Contact Substances.

    Section 617(a) amends Section 409(a) of the FFDCA (21 
U.S.C. 348(a)) by providing that a food additive that is a food 
contact substance is unsafe unless it is used in conformity 
with an applicable food additive regulation or an effective 
premarket notification. This section further amends Section 
409(a) to state that a food is not adulterated by virtue of 
containing or bearing a food additive that is a food contact 
substance used in accordance with an applicable regulation or 
effective notification. Section 617(a) establishes a new 
process, premarket notification, by which food contact 
substances can lawfully enter the marketplace.
    Section 617(b) creates a new Section 409(h) of the FFDCA. A 
new Section (h)(1) establishes the process, terms, and 
conditions of the PMN approach for food contact substances. 
Receipt by FDA of the PMN is required at least 120 days prior 
to introduction of the substance into interstate commerce or 
its delivery for such introduction. The notification must 
provide notice of the identity and intended use of the 
substance and other information that forms the basis of the 
notifier's determination that the intended use of the food 
contact substance is safe. The standard for safety for food 
contact substances incorporates the standard under current law, 
specifically Section 409(c)(3)(A) of the FFDCA (21 U.S.C. 
348(c)(3)(A)). Section (h)(1) also authorizes FDA to issue 
regulations specifying the information required in a PMN. The 
types and amount of information required will be comparable to 
that currently required for food additive petitions for 
``indirect additives.''
    A new Section (h)(2) created by Section 617(b) of this bill 
specifies that a PMN becomes effective automatically 120 days 
after receipt by FDA, unless FDA objects. FDA is not required 
to publish a notice of filing in the Federal Register as it 
currently does in response to food additive petitions. Thus, 
the time period for consideration of a PMN runs from the fier 
has not demonstrated in the PMN that the food contact substance 
is safe. FDA is required to notify the submitter of this 
determination, and it is expected that this notice will specify 
the basis for the determination insufficient detail to 
establish that the Agency has not been arbitrary or capricious. 
Section (h)(2) also establishes that FDA's decision to object 
to a PMN is final agency action subject to immediate judicial 
review. Finally, the Section specifies that a notification is 
only effective with respect to the specific substance listed in 
the notification, and does not extend to similar or identical 
substances manufactured by a person other than the manufacturer 
listed in the notification.
    Section (h)(3) created by Section 617(b) of the bill 
mandates that the PMN process be utilized for authorizing the 
marketing of a food contact substance unless FDA determines 
that a food additive petition is necessary to provide adequate 
assurance of safety, or unless FDA and a company agree that a 
petition may be submitted. FDA is authorized to issue 
regulations to identify the circumstances under which petitions 
will be required, and the Committee fully expects that such 
regulations will be based on sound scientific considerations 
reasonably related to public health and safety, such as 
probable consumption levels and potential toxicity. It is 
intended that the PMN process will be the primary method for 
authorizing the marketing of food contact substances.
    Section (h)(4) created by Section 617(b) requires FDA to 
keep all information in the PMN confidential for the duration 
of the 120 day review period. Following this period, the 
contents of the PMN would be available for disclosure to the 
public as are safety and functionality data filed in a food 
additive petition, consistent with the Freedom of Information 
Act (FOIA) and other related disclosure statutes.
    Section reasonable fees from those who file a PMN in order 
to assure that FDA has the resources needed to review thePMN 
within 120 days. These fees must be based on the resources necessary to 
process the PMNs, including reasonable administrative costs. FDA is 
directed by the bill to conduct a study of the costs of administering 
the PMN program, and, on the basis of this study, issue regulations 
within 18 months of enactment establishing the amount of the fee for a 
PMN. The fees must only reflect the actual costs of processing the 
PMNs, and must be set at a level that is not unduly burdensome on 
industry. These fees will be credited to the FDA, and will be used by 
the Agency solely to defray the costs of administering the PMN program.
    Section (h)(6) provides the new definition of ``food 
contact substance'' to be added to the FFDCA. The definition of 
food contact substance includes any substance intended for use 
as a material or a component of materials used in 
manufacturing, packing, packaging, transporting, or holding 
food if such use is not intended to have any technical effect 
in such food. This definition includes some substances that do 
not meet the definition of a food additive because, for 
example, such substances are generally recognized as safe or 
prior sanctioned for their uses, or they are not reasonably 
expected to become a component of food. ``Not reasonably 
expected to become a component of food'' has been interpreted 
by FDA to include food contact substances separated from food 
by a barrier to migration and those processing aids (e.g., 
solvents and catalysts) that by virtue of the conditions of 
manufacture are removed from the final food contact substance. 
A premarket notification is permitted for food contact 
substances that are not food additives, but is required only 
for those food contact substances that also meet the definition 
of a food additive.
    Section 617(b)(3) of this bill adds authorization for FDA 
to issue regulations establision demonstrates that just as 
Congress recognized the need for a process for revoking a 
regulation for a food additive, the situation is no different 
for food contact substances being marketed subject to a PMN.
    Section 617(c) specifies that this legislation shall be 
effective following 18 months from the date of its enactment. 
PMNs may be filed after this period (and become effective 120 
days after their receipt by FDA) without regard to whether FDA 
has issued regulations implementing this legislation.

Sec. 617. Health Claims for Food Products.

    Section 617 amends section 403(r)(3) (21 U.S.C. 343(r)(3)) 
of the FFDCA. It provides an alternative to the current 
standard and review process by allowing health claims to be 
made based on information published by authoritative U.S. 
government scientific bodies. The new provision will allow a 
health claim in food labeling without FDA authorization, if it 
consists of or will otherwise summarize or reflect information 
contained in a publication of a Federal Government scientific 
organization or some component of the National Academy of 
Sciences. If any such health claim is made, it must be 
submitted to FDA, along with the published information on which 
it is based, at least 120 days prior to its appearance in the 
marketplace. A claim meeting the requirements may be made until 
a final regulation, prohibiting or modifying the claim, becomes 
effective, or a U.S. District Court determines that the 
nutritional claims requirements have not been met.

Sec. 618. Pediatric Studies Marketing Exclusivity.

    Section 618 amends Chapter V (21 U.S.C. 351 et seq.) of the 
FFDCA by creating new section 515A--Pediatric Studies of Drugs. 
If, prior to the approval of a new drug, the Secretary 
determines that information about the drug will produce health 
benefits in a pediatric population, and makes a written request 
for pediatric studies, and the studies are completed and 
accepted, then the sponsor or manufacturer can qualify for up 
to 6 months of extra market exclusivity. If the Secretary makes 
a written request for pediatric studies of an already marketed 
drug, and those studies are completed, then the manufacturer 
can be granted up to 6 months of increased market exclusivity 
as well.
    Within 180 days of enactment, the Secretary, after 
consultation with experts, must develop and publish an initial 
list of approved drugs for which additional pediatric 
information may produce health benefits. When the Secretary has 
formally requested pediatric studies those studies must be 
conducted by a written protocol agreed to by the sponsor, 
patent holder, and the Secretary. Less than 60 days after the 
pediatric studies have been submitted, the Secretary must 
determine whether the studies were done properly and notify the 
sponsor or holder. In addition, theprovision contains a section 
describing other means by which the study protocol requirements can be 
met.
    This section contains a sunset provision that states that 
no market exclusivity will be granted based on pediatric 
studies begun after January 1, 2004. In addition, the Secretary 
must complete a study and report to Congress no later than 
January 1, 2003, the agency's experience under the program. The 
report must address the program's effectiveness, the adequacy 
of its incentives, the program's economic impact, and any 
suggestions for the program's modification.

Sec. 619. Positron Emission Tomography

    Section 619 amends the FFDCA to include the regulation of 
compounded positron emission tomography (PET) drugs. The 
provision defines compounded PET drugs to mean drugs that 
exhibit spontaneous disintegration of unstable nuclei; includes 
nonradioactive reagents, nuclide generators, accelerators, 
electronic synthesizers, or associated software used to prepare 
any such drug; and, which have been compounded in accordance 
with State law by or on the order of a practitioner licensed in 
that State or in a federal facility in accordance with the laws 
of the State in which it is located. The Act is amended to 
stipulate that a compounded PET drug is adulterated, and thus 
subject to regulatory and/or legal action by FDA if it is not 
compounded, processed, packed, or held in accordance with the 
PET compounding standards and official monographs of the United 
States Pharmacopoeia (USP).
    The act is further amended to provide that neither a New 
Drug Application (NDA) nor an Abbreviated New Drug Application 
(ANDA) is required by a licensed practitioner to produce a 
compounded PET product in accordance with USP standards. Within 
30 days of enactment, the Secretary must publish in the Federal 
Register a notice revoking all previously published efforts by 
FDA to provide industry guidance and regulatory standards for 
PET products.

                   TITLE VII--FEES RELATING TO DRUGS

Sec. 701. Short Title.

    Section 701 provides that this title be cited as the 
``Prescription Drug Users Fee Reauthorization Act of 1997.''

Sec. 702. Findings.

    Section 702 sets forth four congressional findings: (1) the 
prompt approval of safe and effective new drugs and other 
therapies is critical to improve public health; (2) additional 
resources augmenting the Food and Drug Administration's (FDA) 
review of human drug applications serve the public health; (3) 
the successful Prescription Drug User Fee Act of 1992 (PDUFA) 
program reduced drug review times; therefore it should be 
reauthorized for an additional 5 years and should be carried 
out by FDA with more ambitious and comprehensive regulatory 
goals; (4) fees authorized by amendments will be used to 
expedite the drug development and application review process 
through goals identified in letters [date unspecified] from the 
Secretary to the Chairman of the House Committee on Commerce 
and Chairman of the Senate Committee on Labor and Human 
Resources, as set forth in the Congressional Record [date 
unspecified].

Sec. 703. Definitions.

    Section 703 augments several definitions in section 735 (21 
U.S.C. 379(g)). New section 735 will not allow PDUFA funds to 
pay for review or processing of biological license applications 
for further manufacturing only nor cover a product that is not 
sod commercially and whose application or supplement is 
submitted by a State or Federal government entity. PDUFA would 
cover review of licenses for large volume biological products 
used for single dose intravenous injection or infusion. Section 
703(3) amends section 735(4) to ensure that the term ``final 
dosage form'' of a prescription drug does not need any further 
``substantial'' modification. Section 735(7) is amended to 
allow expenses of contractors of FDA to be paid with PDUFA 
funds. The ``adjustment factor'' would now be the lower of 
either the Consumer Price Index for all urban consumers (with 
August 1992 replaced with April 1997) or one plus the total 
percentage increase for a fiscal year since 1997 in the general 
schedule of base pay for federal employees after adjustments 
have been made for employees stationed in the District of 
Columbia. The term ``business affiliate'' means a business 
relationship in which one business, directly or indirectly, 
controls or has the power to control, the other businesses, or 
a third party controls, or has the power to control both 
businesses.

Sec. 704. Authority to Assess and Use Drug Fees.

    Section 704(a) amends Section 736(a) (21 U.S.C. 379h(a)) 
establishing types of fees. PDUFA re-authorization will begin 
in fiscal year (FY) 1998. It will require payment offees 
whenever an application or supplement is submitted to the agency. 
Section 736(a)(1)(D) is amended to allow 75 percent of the fee to be 
refunded if FDA refuses to file an application.
    Section 704(2) also adds three exceptions to the payment of 
fees. Section 736(a)(1) exempts in new subsection (E) an 
application or supplement for designated orphan drugs or 
indications submitted under section 526 to treat a rare disease 
or condition. To get an exemption, the application or 
supplement cannot include any uses other than for rare diseases 
or conditions. Section 736(a)(1) is amended to add a new 
subsection (F) wherein a person submitting an application for a 
pediatric drug will be assessed a fee only if the application 
is for the initial approval for use in a pediatric population 
or for use by pediatric and non-pediatric populations. Section 
736(a)(1) is amended to add subsection (G) to refund a fee if 
the application is withdrawn. It allows the Secretary sole 
discretion to waive and refund a fee if no substantial work was 
performed on the application or supplement before it was 
withdrawn.
    Section 704(3) also amends section 736(a)(2), the 
prescription drug establishment fee, to ensure that generic 
drug manufacturing establishments, whether they produce drugs 
that were approved before or after 1984 will not pay a fee nor 
will establishments that manufacture generic antibiotics.
    Section 704(4) amends section 736(a)(3), the prescription 
drug product fee, to expand the definition of those who must 
pay the fee. It will require all applicants be included whose 
product has been submitted for listing with the Secretary. It 
also amends the schedule for payment so that a fee will be paid 
for the fiscal year in which the product is first submitted for 
listing under section 510 of the FFDCA (Registration of 
Producers of Drugs and Devices) or for relisting if the product 
had been withdrawn. After the fee is paid for the fiscal year, 
the fee must be paid on or before January 31 of each year 
thereafter. Innovator antibiotic drug products (antibiotic 
drugs whose initial certification or approval was under section 
507) are subject to product fees; however, generic antibiotic 
drug products with approval granted prior to the Drug Price 
Competition and Patent Term Restoration Act of 1984.
    Section 704(b) amends section 736(b) relating to fee 
amounts (21 U.S.C. 379h(b)) to eliminate the word ``schedule'' 
and set the fee to be assessed as follows: (1)(A) FULL FEES. 
The application fee shall be $250,704 in FY 1998, $256,338 in 
FY 1999 and 2000, $267,606 in FY 2001, and $258,451 in FY 2002. 
(1)(B) PARTIAL FEES. The supplement fee shall be $125,352 in FY 
1998, $128,169 in FY 1999 and 2000, $133,803 in FY 2001, and 
$129,226 in FY 2002.
    Section 736(b)(2) will also amend fee revenue amounts to be 
collected from establishment fees. Total fee revenues collected 
as establishment fees shall be $35.6 million in FY 1998, $36.4 
million in FY 1999 and 2000, $38 million in FY 2001, and $36.7 
million in FY 2002.
    Section 736(b)(3) will also amend fee revenue amounts to be 
collected from product fees. Total revenues collected from 
product fees for a fiscal year shall equal total establishment 
fees each year.
    Section 736(c) is amended to create a section entitled 
``Adjustments,'' with a new subsection title ``(1) Inflation 
Adjustment.'' The Secretary could change the adjustment made 
each fiscal year to the fees collected by adding, on a 
compounded basis, the sum of all adjustments made each fiscal 
year after FY 1997. The annual fee adjustment should begin on 
September 30, 1997, and the establishment and product fees 
should be adjusted so that their revenue shall be set to equal 
the revenues collected from application and supplement fees.
    Section 736(d) on fee waiver and reduction (21 U.S.C. 
379h(d)) restructures the paragraphs and adds to the assessment 
provision that if the applicant is a small business and submits 
its first new drug application to the Secretary for review, it 
can receive a waiver or reduction in fees. Section 
736g(d)(3)(A) defines the term ``small business'' to mean an 
entity that has fewer than 500 employees, including employees 
of affiliates. Section 736g(d)(3)(B) allows the Secretary to 
waive the fee if the small business or affiliate is submitting 
for the first time an application for approval of a human drug. 
After this first time waiver is granted, the small business or 
affiliate must pay fees on all subsequent applications or 
supplements. The Secretary may also use ``standard costs'' in 
making the finding that the waiver or fee reduction is 
necessary to protect the public health.
    Section 704(e) amends section 736(f)(1) (21 U.S.C. 
379g(f)(1)) to update to FY 1997. Section 704(f) amends section 
736(g) (21 USC 379g(g)) to allow the transfer of appropriated 
funds from the account for salaries and expenses of one fiscal 
year to another fiscal year accountif the funds are available 
solely for reviewing human drug applications. It also amends the 
statute to allow funds to be collected in each fiscal year in an amount 
specified in appropriation Acts or otherwise be made available for 
obligation. It also specifies that fees shall only be collected and be 
available to defray increases in the costs of the resources allocated 
for the review process for human drugs over such costs, excluding costs 
paid for fees collected under this section, for FY 1997; and multiplied 
by the adjustment factor.
    Section 704(f) amends section 736(g)(3) and authorizes to 
be appropriated for fees: (A) $106,800,000 for FY 1998; (B) and 
(C) $109,200,000 for FY 1999 and 2000; (D) $114,000,000 for FY 
2001; and (E) $110,100,000 for FY 2002. These amounts reflect 
adjustments in the total fee revenues made under this section 
and changes in the total funds collected by the four fees: 
application, supplement, establishment, and product fees.
    Section 704(f)(3) amends section 736(g) to add a new 
section: (f)(4) OFFSET. This subsection allows any collected 
fees over the authorized amount to be credited to an 
appropriation account of the FDA and be subtracted from the 
subsequent fiscal year authorization to collect fees.
    Section 704(g) amends section 736 (21 U.S.C. 379h) to 
create a subsection (i) and provides that, to qualify for 
consideration of a waiver or fee reduction or refund, a person 
must submit a written request to the Secretary for this action 
within 180 days after the fee is due.
    Section 704(h) amends section 736 (21 U.S.C. 379h) to 
create a subsection (h) providing for a special rule for 
waiver, refunds, and exceptions. It allows that any requests 
for waivers, refunds, or exceptions for fees paid prior to the 
date of enactment could be submitted in writing to the 
Secretary within one year after enactment of this Act.

Sec. 705. Annual Report.

    Section 705 requires two reports to be prepared by the 
Secretary of Health and Human Resources and submitted to the 
House Committee on Commerce and the Senate Committee on Labor 
and Human Resources. The first will report, within 60 days 
after the end of the fiscal year, on the progress FDA achieved 
in meeting the performance goals identified in the letters 
described in section 702(4). The second will report within 120 
days on the implementation of the authority for such fees 
during the fiscal year and FDA's use of the fees.

                       title viii. miscellaneous

Sec. 801. Registration of Foreign Establishments.

    Section 801 amends section 510(i) of the FFDCA to require 
that any establishment within any foreign country engaged in 
the manufacture, preparation, propagation, compounding, or 
processing of a drug or a device that is imported or offered 
for import into the United States must register with the 
Secretary the name and place of business of the establishment 
and its United States' agent. The establishment must provide 
the information required under section 510(j) of the FFDCA. 
Section 801 authorizes the Secretary to enter into cooperative 
agreements with foreign countries to ensure that adequate and 
effective means are available to determine whether drugs or 
devices manufactured, prepared, propagated, compounded, or 
processed by a foreign establishment, if imported or offered 
for import into the U.S., should be refused admission on 
grounds set forth in section 801(a) of the FFDCA, i.e., imports 
and exports.

Sec. 802. Elimination of Certain Labeling Requirements.

    Section 802 amends section 503(b)(4) of the FFDCA and 
provides that a drug subject to section 503(b)(1) is misbranded 
if at any time prior to dispensing the label of the drug does 
not bear, at a minimum, the symbol ``Rx only.'' A drug that 
does not fall under (b)(1) is deemed to be misbranded if at any 
time prior to dispensing the label of the drug bears the symbol 
``Rx only.'' Also, section 502(d) of the FFDCA is repealed, 
i.e., labeling on habit forming narcotic or hypnotic drugs.

Sec. 803. Clarification of Seizure Authority.

    Section 803 amends section 304(d)(1) of the FFDCA by 
removing the reference to paragraphs (1) and (2) of section 
801(e)(1) of the FFDCA and inserting a reference to only 
subparagraphs (A) and (B) of section 801(e)(1) of the FFDCA. 
While the current provision appears to make inapplicable all of 
paragraphs (1) and (2) to the situation where a condemned 
article is exported to the original foreign supplier, the 
amending language makes inapplicable only two requirements 
found in subparagraphs (A) and (B). Additionally, this section 
adds the new sentence which provides that any person seeking to 
export an imported article under section 304(d) of theFFDCA 
must establish that the article was intended for export at the time the 
article entered commerce.

Sec. 804. Intramural Research Training Award Program.

    Section 804 amends Chapter IX of the FFDCA [Miscellaneous], 
by adding the new section 907 [sic] which establishes the 
``Research Training Award Program.'' New subsection (a) 
authorizes the Secretary, acting through the Commissioner, 
directly or through grants, contracts, or cooperative 
agreements, to conduct and support research training in 
regulatory scientific programs by pre- and postdoctoral 
scientists and physicians. This may include support through the 
use of fellowships. New subsection (b) provides that the 
recipient of a fellowship may not be an employee of the Federal 
government. And, under new subsection (c), the Secretary is 
authorized, acting through the Commissioner, to support the 
provision of assistance for fellowships through a Cooperative 
Research and Development Agreement.

Sec. 805. Device Samples.

    Section 805(a)(1) amends section 518(e)(2) of the FFDCA 
[Recall authority for devices] adding the new subsection 
(e)(2)(C) which provides that if the Secretary issues an 
amended order under subparagraph (A), he may require the person 
subject to the order to submit such samples of the device and 
its components as the Secretary may reasonably require. If the 
submission of the samples is impracticable or unduly 
burdensome, this requirement may be met by submitting complete 
information concerning the location of one or more such devices 
readily available for examination and testing. Section 
805(a)(2) of the bill amends section 518(e)(2)(A) of the FFDCA 
by providing a technical amendment which strikes an apparently 
erroneous reference to subparagraph (C) in (e)(2)(A).
    Section 805(b) [Records and reports on devices] amends 
section 519(a) of the FFDCA, as amended by section 607(a) of 
the bill, and adds new paragraph (a)(9) which provides that 
regulations issued under the first sentence of subsection (a) 
may reasonably require a manufacturer, importer, or distributor 
to submit samples of a device or its components that may have 
caused or contributed to a death or serious injury. This 
submission is not required if it is impracticable or unduly 
burdensome. The requirement may be met by the submission of 
complete information concerning the location of one or more 
such devices readily available for examination and testing.

Sec. 806. Interstate Commerce.

    Section 806 amends section 709 of the FEDCA by providing 
that in any action to enforce the FFDCA respecting a device, 
food, drug, or cosmetic, the connection with interstate 
commerce required for jurisdiction shall be presumed to exist.

Sec. 807. National Uniformity for Nonprescription Drugs and Cosmetics.

    (Amendment offered by Senator Gregg.) (This section was 
number 808 in amendments to the bill.)
    Section 807 amends Chapter VII [General Authority] of the 
FFDCA, as amended by section 615 of the bill, by adding a new 
subchapter F entitled ``National Uniformity for Nonprescription 
Drugs for Human Use and Cosmetics.'' New section 761(a) 
provides that, except in certain subsections, no State or 
political subdivision of a State may establish or continue to 
effect any requirement (1) that relates to the regulation of a 
drug intended for human use that is not subject to the 
requirements of section 503(b)(1) or a cosmetic and (2) that is 
different from or in addition to a requirement of this Act, the 
Poison Prevention Packaging Act, or the Fair Packaging and 
Labeling Act.
    However, upon application by the State, the Secretary may, 
by regulation, after notice and opportunity for written and 
oral views, exempt a State requirement that protects an 
important public interest that will otherwise be unprotected; 
will not cause any drug or cosmetic to be in violation of any 
applicable requirement or prohibition under Federal law; and, 
will not unduly burden interstate commerce. This provision 
shall not include any requirement that relates to the practice 
of pharmacy or any requirement that a drug be dispensed only 
upon the prescription of a practitioner licensed by law to 
administer the drug. Furthermore, with regard to scope, this 
provision shall include any requirement relating to public 
information or any public communication relating to the safety 
and effectiveness of a drug or cosmetic. Any, nothing in this 
section shall be construed to modify or otherwise affect any 
action or the liability of any person under the product 
liability law of any State.

Sec. 808. Information Program on Clinical Trials for Serious or Life-
        Threatening Diseases.

    (Amendment offered by Senator Dodd) (This section was 
number 808 in amendments.)
    Section 808 amends section 402 of the Public Health Service 
Act (42 U.S.C. Sec. 282; Director of National Institutes of 
Health) by inserting a new subsection 282(j), after 
redesignating subsection (j) as (k) and subsection (k) as (l). 
The new subsection provides that the Secretary, acting through 
the Director of NIH and subject to available appropriations, 
shall establish, maintain, and operate a program with respect 
to information on research relating to the treatment, 
detection, and prevention of serious or life-threatening 
diseases and conditions. The program shall, with respect to the 
agencies of HHS, be integrated and coordinated and, to the 
extent practicable, coordinated with other information banks.
    After consulting with the Commissioner, the directors of 
the institutes of NIH, including the National Library of 
Medicine, and the Director of the CDC, the Secretary shall 
establish a data bank of information on clinical trials for 
drugs, and biologicals, for serious or life-threatening 
diseases and conditions. The Secretary shall collect, catalog, 
store and disseminate this information through information 
systems, which must include toll-free telephone communications 
and be available to persons with serious or life-threatening 
diseases and conditions, the public, health care providers an 
researchers.
    The Data Bank must include: (A) a registry of clinical 
trials of experimental treatments for serious or life-
threatening diseases or condition that describes the purpose of 
each experimental drug or biological protocol, either with the 
consent of the sponsor or when a trial to test efficacy begins. 
The information shall consist of eligibility criteria, location 
of trial sites, point of contact, in a form readily understood 
by the public, and must be forwarded to the data bank by the 
sponsor of the trail not later than 21 days after the approval 
by the FDA; (B) information pertaining to treatments that may 
be available under a treatment investigational new drug 
application that has been submitted to the FDA under pertinent 
regulations or as a Group C cancer drug. The Bank may include 
information relating to the results of clinical trials, with 
the consent of the sponsor, including potential toxicities or 
adverse effects. It shall not include information relating to 
an investigation if the sponsor has certified to the Secretary 
that disclosure will substantially interfere with the timely 
enrollment ofsubjects in the investigation. To carry out the 
program, the bill authorizes to be appropriated such sums as may be 
necessary, and fees collected under section 736 of the Act shall not be 
used or appropriated for this.
    Section 808(b) provides that the Secretary, the Director of 
NIH, and the Commissioner shall collaborate to determine the 
feasibility of including device investigations within the 
registry. Within two years of enactment, the Secretary must 
prepare and submit to the Senate Committee on Labor and Human 
Resources and the House Committee on Commerce a report that 
considers, among other things, the public health need for 
including devices and the adverse impact, if any, on device 
innovation and research if information on devices is publicly 
disclosed.

Sec. 809. Application of Federal Law to the Practice of Pharmacy 
        Compounding.

    Section 809 amends section 503 of the FFDCA by adding the 
new subsection (h). New subsection (h)(1) provides that 
sections 501(a)(2)(B) [Adulterated drug], 502(f)(1) [Misbranded 
drug], 502(1) [Antibiotic drug], 505 [New drugs], and 507 
[Certification of antibiotics] shall not apply to a drug 
product that is compounded for an identified patient based on a 
medical need for a compounded product (1) by a licensed 
pharmacist in a State licensed pharmacy or Federal facility or 
licensed physician on the prescription order of a physician or 
other licensed practitioner authorized by State law to 
prescribe drugs; (2) by a licensed pharmacist or licensed 
physician in limited quantities, before receiving a valid 
prescription order for an identified individual if the 
compounding of the drug is based on a history of receiving 
valid orders that have been generated solely within an 
established relationship between the pharmacist and the 
individual patient or the physician or other licensed 
practitioner who will write the prescription order.
    The above noted sections of the FFDCE shall not apply to a 
drug product if the pharmacist or physician (1) compounds a 
drug product using bulk drug substances that meet the 
requirements of this section; (2) compounds a drug product 
using ingredients other than bulk drug substances that comply 
with an applicable U.S. Pharmacopeia monograph and the U.S. 
Pharmacopeia chapter on pharmacy compounding; (3) does no more 
than advertise or promote the compounding service and does not 
advertise or promote the compounding of a particular drug, 
class of drug or type of drug; (4) does not compound a drug 
product that appears on a list published by the Secretary of 
drug products that have been withdrawn or removed from market 
because it is unsafe or not effective; (5) does not compound a 
particular drug product that is identified by the Secretary in 
regulation as having demonstrable difficulties in being 
compounded that reasonably demonstrate an adverse affect on the 
safety and effectiveness of that drug product; and (6) does not 
distribute compounded drugs outside the State in which the 
pharmacy is located, unless the State agency of jurisdiction 
has entered into a memorandum of understanding (MOU) with the 
Secretary based on adequate regulation of compounding performed 
in the State, which provides for appropriate investigation of 
complaints by the State agency relating to compounded products 
distributed outside the State.
    In cooperation with the National Association of Boards of 
Pharmacy, the Secretary is required to develop a standard MOU 
for use by States in complying with the subsection relating to 
distribution outside the State. Until 180 days after the 
standard MOU is developed or the date entered in the MOU, 
whichever is first, the subsection relating to distribution 
outside the State [new section 503(h)(2)(vi)] does not apply to 
a pharmacist or physician who does not distribute inordinate 
amounts of compounded drugs out of State.
    Section 809(b) requires the Secretary, after consultation 
with the U.S. Pharmacopeia, to develop regulations limiting 
compounding to drug substances that are components of drug 
products approved by the Secretary and other substances 
identified by the Secretary. Sections 809 (c) and (d) state 
that new section 503(h)(1) shall not apply to compounded 
positron emission tomography drugs, as defined in section 
202(jj), or radiopharmaceuticals.
                         VIII. Additional Views

                              ----------                              


            ADDITIONAL VIEWS OF SENATORS GREGG AND McCONNELL

    During the course of the Committee's consideration of S. 
830, Senator Gregg offered, and subsequently withdrew, an 
amendment to modify the PDUFA ``maintenance of effort'' 
requirement as proposed for authorization by this legislation. 
This amendment would have created critical protections for the 
FDA budget while instituting a realistic budgetary foundation 
for the PDUFA reauthorization provisions contained in S. 830.
    The goal of the amendment was to ensure that the FDA budget 
may not take a reduction in the Agency's base appropriation 
level at a percentage greater than the percentage by which the 
602(b) allocation of the Agriculture Subcommittee of 
Appropriations was reduced in order for the ``trigger''--FDA's 
ability to collect and spend industry-paid user fees--to be 
activated. The mutual agreement of the FDA and the 
pharmaceutical industry holds promising benefits for the health 
and welfare of American patients. We are concerned, however, 
that the absence of thorough discussions on the relationship 
between the reauthorization of PDUFA and Congress' efforts to 
attain a balanced budget may undermine these objectives.
    During the course of the Committee consideration, the 
Members of the Committee were never provided with information 
to clarify the level of total agency appropriations necessary 
in each of the next five fiscal years to ``trigger'' the 
collection of user fees for new human drugs. According to the 
FDA, in written response to questions asked by Members of the 
Senate, the base year funding required in FY 1997--the last 
year of the current PDUFA program--the FDA must dedicate 
$125.794 million in appropriated funds to human prescription 
drugs reviews. In FY 1998, under current law requirements, the 
FDA would have to dedicate over $128.833 million to these 
activities. However, it is apparent that the FDA does not even 
have a clearly defined system of checks and balances agency-
wide; while they are able to produce accounting reports 
associated with PDUFA, they are unable to provide Congress with 
reports of equivalent quality for the total agency 
appropriation. In addition, it is unclear as to whether the FDA 
is dedicating a disproportionate amount of funds to these 
activities at the expense of other accounts, such as those 
funds that are intended to be expended on the review of medical 
devices, foods, or generic drugs, which are not covered by user 
fee agreements.
    Further, the Administration requested 8% reduction, $68 
million, for the FDA's FY 1998 appropriations. To ``replace'' 
these funds, the OMB assumed $131 million in unauthorized user 
fees with no indication of the likelihood for industry or 
Congressional approval and little information on the validity 
of OMB's assumption regarding these requested funds. This, 
coupled with the assumption that FDA will not see any changes 
in its mandated mission--for example, a transfer of a 
regulatory and fiscal obligation such as ensuring seafood 
safety from FDA to USDA--puts Congress in the uncomfortable 
position of trying to maintain funding for activities that may 
or may not remain relevant during the five year period of this 
reauthorization.
    Clearly, PDUFA's continued role as a source of 
supplemental, not replacement, fund is important to the 
prescription drug industry and the consumers it serves. We feel 
that the direction of this amendment provides a reasonable 
middle ground between the mutual objectives of industry and the 
FDA and the Administration's balanced budget mode. This 
amendment recognizes the importance of the FDA as a national 
public health agency and that it should not be a site for 
``found money'' within the Agricultural account, while it 
acknowledges that 602(b) allocations conceivably may experience 
reduction in future years.
    We believe that the Secretary of Health and Human Services 
sent the Committee a clear signal of concurrence in a letter 
addressed to the Chairman, dated June 11, 1997, when she wrote:

          We would support a user fee proposal that is 
        consistent with our FY 1998 Budget proposal, but we are 
        concerned that the proposal to collect user fees in 
        this legislation imposes additional pressure on the 
        fixed level of discretionary resources agreed to under 
        the Bipartisan Budget Agreement.

    While we believe that cooperative discussions with the 
Appropriations Committee and the Administration can best 
address this issue, it is of utmost importance that the Members 
of this Committee recognize the seriousness of this matter to 
PDUFA's future. We are confident that this Committee does not 
intend to reauthorize PDUFA in a manner that could potentially 
prohibit the Agency's ability to collect the agreed upon fees, 
nor to force the Appropriations Committee to act independently 
of the reauthorization provisions in order to make PDUFA work.
    We hope that the broader involvement of Members of the 
Appropriations Committee and the Administration will provide 
the fiscal framework necessary to the successful resolution of 
this important matter for American patients and pharmaceutical 
providers.
                                   Judd Gregg.
                                   Mitch McConnell.
                   ADDITIONAL VIEWS OF SENATOR HARKIN

    While I strongly support meaningful reform of the Food Drug 
and Cosmetics Act, I voted against S. 830 because I believe 
that critical improvements must be made to the provision 
relating to accredited review of medical devices. In addition, 
I do not believe the bill goes far enough to improve the post-
market surveillance of high risk, potentially life-threatening 
devices.
    The provision relating to accredited party review is 
described as a ``pilot'' to test whether the use of third party 
reviewers would reduce delays in medical device approvals. But 
the provision is overly broad in scope and it is my hope that 
the ``pilot'' can be altered to address the concerns outlined 
below.
    The ``pilot'' in S. 830 does not limit in any way the 
number and types of products that may go through a third party 
reviewer. I believe a test of third party review should be 
limited to less complex devices that pose a smaller potential 
risk to patients should this new review process prove 
ineffective. This is simply common sense. If we plan to test an 
unproven process, let's do so in a manner that regardless of 
outcome, poses the least amount of risk to public health and 
safety.
    There are provisions in S. 830 giving FDA final product 
review authority, but I am concerned that a 30 or 60 day time 
limit for FDA action will be extremely difficult, or 
impossible, for the Agency to meet.
    In addition, under S. 830 the manufacturer of the device 
selects the reviewer and also directly pays the reviewer. 
Direct payment by the manufacturer of the reviewer, without 
approval or even review by FDA, creates obvious conflicts of 
interest. Under FDA's current third party review regulations, 
the Agency has the authority to review compensation agreements 
between the manufacturer and the reviewer. However, the bill 
does not provide FDA full and clear authority in this area. I 
believe the FDA should have the authority in the statue to 
review payment agreements and check for conflict of interest.
    I am also concerned that this bill fails to provide 
adequate performance criteria for the post market surveillance 
of sophisticated, potentially life-threatening medical devices. 
If this bill requires the Agency to be more efficient during 
the approval process, I believe we need to make extra sure the 
FDA strengthens its efforts to track and monitor products that 
would present a danger to the public health should they be 
found to be unsafe or ineffective.
                                                        Tom Harkin.
                   ADDITIONAL VIEWS OF SENATOR MURRAY

    I strongly endorse FDA modernization and reform which is 
why I voted to report S. 830 out of committee. But, I believe 
that several points need to be made to clarify my position on 
this legislation. First, I would like to make a few comments on 
the process and express my concerns regarding this pending 
bill. First, I do want to recognize the work that you and your 
staff have done in developing this measure. I appreciate your 
efforts to work to correct some of my concerns and your 
willingness to craft acceptable language when appropriate.
    Having said that, I do need to express some concerns with 
this process. As a new member of this committee I did not have 
the benefit of being here for last year's mark-up where many of 
these issues were discussed and debated at length. I realize 
that we did have two hearings on FDA reform, but one primarily 
focused on PDUFA. As we all know, these issues are far from 
simple and in most cases are extremely complicated. In 
addition, the implications of what we do or don't do are 
significant.
    There has been limited time to review your draft and the 
many amendments under consideration. In light of the important 
public health issues involved I believe that the prudent course 
would have been to schedule a hearing on your draft in order to 
hear testimony from expert witnesses as to the ramifications of 
each section.
    My objective all along has been to reform FDA, to 
revitalize a public health agency that faces life or death 
decisions every day. One of the reasons I worked to secure a 
position on this committee is because I wanted to play a direct 
role in health care policy--FDA is one of the most critical 
health care policy issues this committee will consider in the 
105th Congress. We have an opportunity to improve access to 
health care products for million of Americans. Effective reform 
of the FDA can be a life saver.
    I do want to make it clear that there are some real reform 
proposals included in the bill that will serve to improve the 
overall performance of the FDA. I want to thank the Chairman 
for including some of these items.
    I am here today because I made the decision several years 
ago, to be an advocate for children. I got directly involved in 
the political process because I was concerned that the voices 
of children were not being heard. I have always considered 
children's issues my top priorities. Because of this, I am 
pleased that included in the legislation is the Dodd/Dewine 
Pediatric Studies Marketing Exclusivity title. I believe that 
the FDA has not done enough to encourage greater pediatric 
clinical trials. For too long children have simply been 
ignored. Providing patent exclusivity incentivesto companies to 
include children in clinical trails may be the push that the industry 
needs. I realize that there are some questions and concerns about this 
approach, but unfortunately, this is the only solution I have seen that 
will work. I am hopeful that we can address some of the concerns of the 
generic drug manufacturers. No one wants to increase the cost of health 
care, but if children are denied life saving treatments or are unable 
to benefit from break through drugs that can reduce the severity of 
their illness, we have saved in the long run. I am willing to work on 
some type of transitional language or criteria for the Secretary's 
selection process, but honestly believe we have an obligation to expand 
clinical trial to include children.
    I would also like to point out that the improvements made 
in the expansion of the humanitarian use of devices will 
provide life saving alternatives to physicians and patients.
    I am also pleased that the Chairman has worked to improve 
collaboration and communication between the FDA and industry. 
The language in the bill does require more collaboration 
between the FDA and industry throughout the approval process, 
but this should be seen as a positive step, not a burden on the 
agency. Success is much easier to obtain if the FDA and the 
industry work more as a team with clear expectations and open 
lines of communications.
    It is unfortunate that due to many of the more 
controversial issues, we have not talked much about Title VII--
PDUFA reauthorization. This is one of the most positive aspects 
of the bill and illustrates the success we can achieve when we 
all share the same objectives and priorities. Title VII 
establishes new performance standards for the FDA that will 
only improve the process. I want to commend the FDA for putting 
forth this reauthorization language and working with, not 
against industry and the patients.
    Despite the many positive improvements, the current draft 
of the pending legislation has some serious flaws and I am 
concerned that in an effort to reform and revitalize the FDA, 
we weaken their role as a public health agency. Despite 
modifications, I am still concerned about some of the proposed 
changes on substantial evidenc--we simply cannot and should not 
act to limit the ability of the FDA to require comprehensive 
clinical trials. I believe that the current Guidance Document 
that governs FDA practices does offer each investigator the 
``guidance'' necessary to determine the number of clinical 
trails necessary--I am still not convinced that the proposal 
before use today will actually clarify, but rather limit the 
ability of FDA to require two trials in order to replicate 
science.
    One of the most significant problems facing FDA is 
theapproval, tracking and surveillance of medical devices. Because of a 
lack of targeted resources, the FDA has been unable to ensure timely 
approval for many, life saving devices. I would acknowledge that the 
agency has made some improvements in this process, but I still believe 
that we need some reform and innovative solutions. There are several 
proposed solutions to the device approval delays. One approach that I 
do believe has some merit is a third party review process. But, if the 
objective to by-pass the FDA, privitize the FDA, as opposed to 
enhancing the activities of the FDA, than I would recommend we seek 
other solutions. From the language in the Chairman's current bill, it 
appears that the structure of the third party review, the types of 
devices that could be approved by a third party and the inherent 
conflict of interest questions could jeopardize the public health. I 
have still not seen any assurance that the public's health and safety 
would not be jeopardized and that the current language would truly 
enhance the FDA's role as the lead agency for device approval. I am 
still not convinced that adding another layer of ``bureaucracy'' will 
improve the approval process--beyond the improvements already achieved 
by FDA. I have several other concerns regarding the device tracking and 
surveillance provisions in the bill and am some what disappointed that 
so much controversy has surrounded one of the most pressing FDA reform 
issues--that is improving and streamlining the device approval, 
surveillance and tracking processes.
    I also believe it is essential that the Gregg amendment 
which preempts a State's ability to enact labeling restriction 
or requirements on over the counter drugs needs to be revised. 
This amendment could effectively prohibit a State from 
requiring warning labels on harmful medications unless they 
first petitioned the FDA for this ability. A State should not 
have to petition FDA in order to require warning labels, such 
as Mr. Yuk, which is an important tool in protecting children. 
While Mr. Yuk may be a voluntary, education campaign, States 
should have the ability to require this kind of labeling. 
Seeking FDA approval is clearly an unfunded mandate on the 
States. While uniformity may be the objective of the Gregg 
amendment, I am concerned that the unintended consequence could 
be harmful for children.
    There are several other areas that I believe need greater 
clarification and do not want to delay this process any 
further, except to say that I am concerned that many of these 
provisions could jeopardize FDA reform and revitalization 
efforts. In addition, the timely reauthorization of PDUFA is 
threatened by much of what we do here today. This in itself 
deeply troubles me.
    I am planning on voting to report this measure out of the 
committee because of the urgency in moving this legislation to 
the floor. I do so with some hesitation, but I sincerely 
believe that moving this process along is a positive step and 
essential for meeting my goal of a public debate on the issues. 
However, the current bill still has many flaws that must be 
adequately addressed before this bill can be sent to the 
President. I am hopeful that I can continue to work with the 
Chairman to improve the legislation without threatening the 
many positive provisions. Without substantial changes and 
revisions I would have a difficult time supporting this 
legislation on the floor. I hope that we can all work to 
achieve real reform that improves the regulatory process, but 
does not weaken an agency that many of us simply take for 
granted. What may have been lost in all of this is the fact 
that the FDA's number one priority is and should always be, 
guarding the public's health and safety.
    Thank you, Mr. Chairman.
                                                      Patty Murray.
       IX. MINORITY VIEWS OF SENATORS KENNEDY, BINGAMAN, AND REED

    As stated in S. 830 the mission of the Food and Drug 
Administration is to protect public health including ensuring 
that drugs and devices are safe and effective and that food is 
wholesome. S. 830 presents a sweeping package of changes that 
will impact every family that fills a prescription, depends 
upon a medical device, or relies on food labels to choose the 
healthiest products for their dinner table.
    Many of the provisions included in this bill are consensus 
items with broad, bipartisan support. If we were to report 
legislation today that includes only the items on which 
consensus has been achieved, we would have crafted the broadest 
FDA reform legislation in decades--reforms that could pass the 
Senate unanimously.
    Unfortunately, despite the progress that has been made, 
this legislation also includes controversial provisions that 
threaten public health. These provisions do not improve the 
FDA--they weaken it. Given these concerns, we oppose the bill 
as currently drafted. If controversial provisions are not 
modified or eliminated from the bill, it will be difficult to 
achieve timely reauthorization of the Prescription Drug User 
Fee Act. We believe Senator Jeffords is committed to trying to 
work out a consensus on these issues before the legislation 
goes to the floor--and we are committed to working with him.

         prescription drug user fee act (pdufa) reauthorization

    The most important of the consensus items in this bill is 
the reauthorization of the Prescription Drug User Fee Act. This 
committee authored the Prescription Drug User Fee Act in 1992. 
This legislation is one of the most effective regulatory reform 
programs ever enacted. The bill established a new partnership 
between the industry and the agency. The industry agreed to 
provide additional, resources; the agency agreed to measurable 
performance standards to speed the review of products. Every 
goal set by that legislation for the FDA has not only been met, 
it has been exceeded.
    Today, the FDA is unequalled in the world in its record of 
getting new drugs quickly to market without sacrificing patient 
protection. In fact, last year, average review times in the 
United States were twice as fast as in Europe. Fifteen new 
drugs were approved in both the European Union and the United 
States--and in 80 percent of the cases, the United States 
approved the new drugs either first or at the same time as the 
European Union. More companies chose the United States for the 
introduction of breakthrough drugs than any other country.
    The Prescription Drug User Fee Act reauthorization, as 
negotiated between the FDA and industry and contained in this 
bill, will maintain and enhance the progress that has been 
achieved. Especially important is the promotion of early 
cooperation between the FDA and industry in order to reduce 
total drug development time, not just FDA review time. This 
legislation is vital, and speedy action is essential. If this 
legislation is not passed by August 1, the FDA will have to 
begin sending lay-off notices to the 600 employees who are 
supported through user fees and who are vital to the timely 
review of drugs and biologics. We are committed to ensuring the 
timely passage of PDUFA in combination with consensus reforms.

                            drug provisions

    Other important consensus provisions in this bill clarify 
that FDA may approve drugs and biologics on the basis of 
products manufactured in pilot and small scale facilities; 
direct FDA to propose regulations governing the approval of 
diagnostic and monitoring radiopharmaceuticals; codify agency 
policies regarding modernization of biologics approvals; 
establish a mechanism for the FDA to review manufacturing 
changes for drugs; require the Agency to issue guidance 
streamlining data submissions for drugs and biologics; and 
provide incentives to encourage drug manufacturers to conduct 
studies on pediatric uses of specified drugs. The bill also 
establishes a ``fast track'' mechanism to facilitate the 
development and expedited approval of new drugs intended for 
the treatment of serious and life-threatening conditions.
    These provisions address a number of industry concerns and 
improve the predictability and efficiency of drug approval and 
manufacturing. In recent years, in partnership with Congress 
and the Administration, the FDA has responded to criticism and 
alleged delays in approving newproducts by taking impressive 
steps to improve its performance. Provisions in this bill will codify 
some of the important practices that the FDA has established to reduce 
unnecessary regulatory burdens on industry and to modernize its 
regulatory processes. These steps have added up to a quiet revolution 
in the way the FDA fulfills its critical missions.

                concerns related to drugs and biologics

    Included in this bill is a provision to allow distribution 
of health economic claims to formularly committees and managed 
care organizations. Health economics is a developing area with 
standards and guidelines that even the experts do not agree 
upon. While this is an important area that should eventually be 
addressed, there has not been time to adequately reflect on the 
complex questions presented. The language included in the bill 
has not been considered in public hearings nor have patient 
groups had an opportunity to provide input on this issue.
    The FDA is developing a policy on regulation of 
pharmacoeconomic data which deals with the fundamental 
questions related to data to support claims of cost-
effectiveness. These fundamental questions should be dealt with 
before enactment of any statutory changes. A more reasonable 
provision would require the agency to develop a policy on 
regulation of pharmacoeconomics. Such a policy would lay the 
groundwork for consideration of distribution of 
pharmacoeconomic claims to formularies and managed care 
organizations. Without this groundwork, there is a danger that 
policies related to dissemination of health economic 
information will become an avenue for off-label promotion of 
unsubstantiated clinical efficacy claims. It is not clear why a 
controversial provision related to health economics that has 
not had adequate public consideration should be attached to 
this bill.
    Issues not included in the current bill must also be 
addressed before a balanced reform package for drugs and 
biologics can be achieved. This is particularly important in 
the area of enforcement. The citizens of this country expect 
the FDA to protect them from unsafe or ineffective drugs and 
biologics. We must provide FDA with the tools needed to carry 
out this mission.
    This is particularly important under circumstances where 
FDA has been given the authority to approve drugs and biologics 
in an accelerated mode. In the early 1990's, new regulations 
made it possible for the FDA to grant marketing approval under 
accelerated reviews to drugs used to treat serious and life-
threatening illnesses. Under these programs, and under the 
proposed fast track program, surrogate endpoints may be used to 
provide early indications of potential clinical benefit. While 
these endpoints are useful for getting drugs to patients 
faster, it is essential that adequate phase IV, post-marketing 
studies be performed to determine the ultimate safety and 
efficacy of the drug.
    A 1996 report by the Department of Health and Human 
Services Inspector General on postmarketing studies of new 
molecular entities indicated that 77 percent of phase IV 
studies requested between 1987 and 1993 were in progress or 
have been submitted to the agency. Of the 23 percent that were 
not in progress or submitted, approximately 6 percent of these 
studies will not be conducted because the FDA released the 
company from their commitment. Of the remaining studies that 
were not in progress or submitted, 11 percent or over 40 
studies had not been completed for reasons that were unknown or 
because the company had simply failed to fulfill its 
responsibility. In some of these cases, over 6 years have 
elapsed and the companies still insist that their studies will 
begin sometime in the future.
    The FDA should have the authority to enforce a request for 
post-market or confirmatory clinical trials especially when 
this data is pursuant to an accelerated approval of a new drug. 
If a company fails to complete a requested trial, currently the 
only remedy available to the Secretary is to remove the drug 
from the market. Even if the process of withdrawal is 
expedited, this remains a cumbersome process which punishes 
patients who depend upon the drug in question. The Patient 
Coalition regards enforcement procedures for phase IV studies 
as a high priority. If we are truly trying to enhance patient 
access to important medicines by providing accelerated 
approvals, we should be prepared to assure that these drugs are 
truly safe and effective.
    The FDA should be given the authority to impose 
intermediate sanctions of civil money penalties for failure to 
perform post-approval research. When phase IV studies are 
needed, theyprovide critically important data to assure safety 
and effectiveness of new drugs. Failure to enforce these requirements 
is unfair to those companies who do fulfill their obligations. We must 
devise fair procedures that will assure that all companies complete 
required studies in a timely manner.

                           device provisions

    We have worked hard to balance the need for changes to 
device approval processes with protection of public health. 
Although a number of consensus device reform provisions have 
been agreed upon, we are concerned that, on balance, this bill 
weakens patient protections from unsafe medical devices. It is 
important to note that the Safe Medical Devices Act of 1990 was 
enacted because medical device oversight in this country was 
deemed inadequate and placed patients at risk. It is also 
important to note that the FDA has made significant 
improvements in the area of device approval.
    Even without additional resources in the device area, the 
FDA's recent achievements have been impressive. So-called 
510(k) applications--devices which are reviewed by the FDA to 
determine their substantial equivalence to a device already on 
the market--account for 98 percent of all device submissions. 
The FDA has now essentially eliminated its backlog. Last year, 
it reviewed 94 percent of these devices within the statutory 
time frame--compared to only 40 percent just 4 years ago.
    In the area of Class III devices, where most problems 
remain, the FDA has improved its performance substantially. 
According to a study by the General Accounting Office, median 
review times dropped 60 percent between 1991 and 1996. A recent 
survey of device industry executives reported that the business 
climate for the industry is the best in the 5 year history of 
the survey. The sponsor of the survey attributes this favorable 
response, in large measure, to improvements at FDA, and 
concludes, ``The agency has not only reduced the produce 
approval delays that slowed new product introductions, but, 
perhaps more importantly, has also greatly reduced both 
executives' and investors' uncertainty about the timeliness of 
future product introductions.''
    We support many of the device reform provisions included in 
the bill. We agree that FDA should be granted the authority to 
recognize performance standards established by nationally or 
internationally recognized standard setting entities. We 
encourage implementation of a system that will provide for 
appropriate industry and public input concerning which 
standards should be accepted.
    We also support provisions that would require FDA to exempt 
certain class devices from premarket notification requirements; 
allow use of data from a premarket approval 6 years after 
approval of the first device of a type; require the FDA to 
issue a regulation establishing criteria to be used in 
determining when a specific intended use of a device is not 
included in a general use; and provide mechanisms for 
preventing inappropriate classification of low or moderate risk 
devices into Class III.

                      concerns related to devices

    We remain very concerned with provisions in the bill that 
turn over reviews of critical medical devices to private 
companies selected and paid by the very industry they are 
supposed to regulate. The FDA currently has a pilot project to 
explore this concept with low risk devices. Some expansion of 
this pilot is warranted. But to test this concept by turning 
over the regulation of the most sensitive and potentially 
dangerous devices to private companies chosen and paid by the 
manufacturer is an unacceptable experiment with the public's 
health. No manufacturer will choose a reviewing company that it 
thinks is going to be too rigorous. Every reviewing company 
knows that its prospects for future business--and even the 
generosity of its fees--are likely to depend on decisions that 
are favorable to the manufacturer.
    Americans today have a high degree of protection against 
unsafe and ineffective devices, because these devices have been 
reviewed by the professional, capable, objective public 
officials at the FDA, who owe allegiance to no interest except 
the public interest.
    The American people deserve protection from unsafe heart 
valves and pacemakers, inaccurate imaging machines used to 
detect breast cancer or brain tumors, faulty drug infusion 
pumps, and other unsafe and ineffective medical technologies. 
They should not have to rely for that protection on untested 
private companies hired and paid by the very firms producing 
thepotentially faulty products.
    In addition the bill also allows device manufacturers to 
manipulate the product label to avoid careful FDA scrutiny and 
to make basic changes in the manufacturing process without 
effective FDA oversight, even if those changes threaten the 
sterility, the safety, or the effectiveness of the product. The 
bill establishes a mechanism for automatic reclassification of 
class III devices without a clear standard for subsequent 
review of the product. Post-market surveillance is arbitrarily 
limited to an initial 24-month period even on products where 
longer surveillance will clearly be required. The cumulative 
effect of these and several other provisions, is to weaken the 
FDA's ability to assure safety and effectiveness of medical 
devices.

                            Food Provisions

    We support the inclusion of a consensus provision on food 
contact substances that has been endorsed by both the FDA and 
the food industry.
    We cannot support the inclusion of a provision that would 
weaken the FDA's oversight of food health claims. The Nutrition 
Labelling and Education Act of 1990 established landmark 
requirements for food labelling that give consumers the right 
to the information they need in order to choose healthy 
products for the family dinner table. This legislation would 
undermine that important right by allowing manufacturers to 
make health claims that could be misleading and even 
inaccurate. This faulty provision in the bill is strongly 
opposed by 20 leading health and consumer organizations, 
including the American Cancer Society, the American Heart 
Association, the National Council on the Aging, and the 
Consumer Federation of America.
    Weakening FDA oversight of health claims would allow food 
companies to use scientific statements about nutrition and 
health made by other government agencies as a basis for health 
claims--even if such statements are not supported by 
``significant scientific agreement''. For example, in 1980 the 
Food and Nutrition Board, an arm of the National Academy of 
Sciences, published a report stating that Americans need not 
cut back on cholesterol in order to reduce their risk of heart 
disease. The report's findings were disputed by the American 
Medical Association, the American Heart Association, and many 
other public health and medical organizations. This and other 
cases underscore the need to assign the job of pre-clearing 
health claims to a single regulatory agency that can sort 
through the data and determine if a claim is supported by 
``significant scientific agreement''.

            Cumulative Agency Burdens Without New Resources

    At a time when agency resources are scarce and demands for 
rapid product review are increasing, this bill will impose a 
number of new bureaucratic burdens. Eighteen new statutory 
deadlines are mandated and twenty Federal Register documents 
must be produced, including 12 regulations by February 1999. 
Excluding new statutory deadlines and required Federal Register 
documents, an additional 28 new statutory tasks will be 
required. A disproportionate share of new bureaucratic 
requirements fall on the Center for Devices and Radiological 
Health (CDRH).
    There are few more important agencies of the federal 
government than the Food an Drug Administration. The FDA is 
responsible for assuring the Nation's food supply is pure and 
health. The FDA provides a guarantee that the drugs and devices 
we rely on to cure or treat diseases are safe and effective. If 
it does its job well, the FDA can speed medical miracles from 
the laboratory bench to the patient's bedside. If the agency 
does its job poorly, it can expose millions of Americans to 
unsafe or ineffective medical products and jeopardize the 
safety of our food.
    Given the importance of the FDA to the American public, any 
reform of this agency should have the broadcast bipartisan 
support. We must work together to reach agreement on provisions 
in this bill that will allow the FDA to do its job well and 
build on the successes of the Prescription Drug User Fee Act.
                                   Edward M. Kennedy.
                                   Jeff Bingaman.
                                   Jack Reed.
                       X. Changes in Existing Law

    In compliance with rule XXVI paragraph 12 of the Standing 
Rules of the Senate, the following provides a print of the 
statute or the part or section thereof to be amended or 
replaced (existing law proposed to be omitted is enclosed in 
black brackets, new matter is printed in italic, existing law 
in which no change is proposed is shown in roman):

                  federal food, drug, and cosmetic act

          * * * * * * *

                        chapter ii--definitions

    Sec. 201. [321] for the purposes of this Act--(a)(1) * * *
          * * * * * * *
    (hh) * * *
          * * * * * * *
    (ii) In any provision relating to a review of any 
application or submission (including a petition, notification, 
and any other similar form of request), made under this Act 
with respect to an article that is a new drug, device, 
biological product, new animal drug, and animal feed bearing or 
containing a new animal drug, color additive, or food additive, 
that is submitted to the Secretary to obtain marketing 
approval, to obtain classification of a device under section 
513(f)(1), or to establish or clarify the regulatory status of 
the article--
          (1) the term ``day'' means a calendar day in which 
        the Secretary has responsibility to review such an 
        application or submission; and
          (2) a reference to a date relating to receipt of such 
        an application or submission by the Secretary shall be 
        deemed to be a reference to the date on which the 
        Secretary receives a complete application or submission 
        within the meaning of this Act and the regulations 
        promulgated under this Act.
    (jj) The term ``compounded position emission tomography 
drug'' means a drug that--
          (1) exhibits spontaneous disintegration of unstable 
        nuclei, including the emission of positrons;
          (2) includes any nonradioactive reagent, reagent kit, 
        ingredient, nuclide generator, accelerator, target 
        material, electronic synthesizer, or other apparatus or 
        computer program to be used in the preparation of any 
        such drug; and
          (3)(A) has been compounded in a State in accordance 
        with State law for a patient or for research, teaching, 
        or quality control by or on the order of a practitioner 
        licensed by that State to compound or order such a 
        drug; or
          (B) has been compounded in a Federal facility in a 
        State in accordance with the law of the State in which 
        the facility is located.
          * * * * * * *

               Chapter III--Prohibited Acts and Penalties

                            prohibited acts

    Sec. 301. * * *
          * * * * * * *

                                seizure

    Sec. 304. [334] (a)(1) * * *
          * * * * * * *
    (d)(1) Any food, drug, device, or cosmetic condemned under 
this section shall, after entry of the decree, be disposed of 
by destruction or sale as the court may, in accordance with the 
provisions of this section, direct and the proceeds thereof, if 
sold, less the legal costs and charges, shall be paid into the 
Treasury of the United States; but such article shall not be 
sold under such decree contrary to the provisions of this Act 
or the laws of the jurisdiction in which sold. After entry of 
the decree and upon the payment of the costs of such 
proceedings and the execution of a good and sufficient bond 
conditioned that such article shall not be sold or disposed of 
contrary to the provisions of this Act or the laws of any State 
or Territory in which sold, the court may by order direct that 
such article be delivered to the owner thereof to be destroyed 
or brought into compliance with the provisions of this Act 
under the supervision of an officer or employee duly designated 
by the Secretary, and the expenses of such supervision shall be 
paid by the person obtaining release of the article under bond. 
If the article was imported into the United States and the 
person seeking its release establishes (A) that the 
adulteration, misbranding, or violation did not occur after the 
article was imported, and (B) that he had no cause for 
believing that it was adulterated, misbranded, or in violation 
before it was released from customs custody, the court may 
permit the article to be delivered to the owner for exportation 
in lieu of destruction upon a showing by the owner that all of 
the conditions of section 801(e) can and will be met. The 
provisions of this sentence shall not apply where condemnation 
is based upon violation of section 402(a) (1), (2), or (6), 
section 501(a)(3), section 502(j), or section 601 (a) or (d). 
Where such exportation is made to the original foreign 
supplier, then [paragraphs (1) and (2) of section 801(e)] 
subparagraphs (A) and (B) of section 801(e)(1) and the 
preceding sentence shall not be applicable; and in all cases of 
exportation the bond shall be conditioned that the article 
shall not be sold or disposed of until the applicable 
conditions of section 801(e) have been met. Any person seeking 
to export an imported article pursuant to any of the provisions 
of this subsection shall establish that the article was 
intended for export at the time the article entered commerce. 
Any article condemned by reason of its being an article which 
may not, under section 404 or 505, be introduced into 
interstate commerce, shall be disposed of by destruction.
          * * * * * * *
    (l) The using, on the labeling of any drug or device or in 
any advertising relating to such drug or device, of any 
representation or suggestion that approval of an application 
with respect to such drug or device is in effect under section 
505, 515, or 520(g), as the case may be, or that such drug or 
device complies with the provisions of such section.
          * * * * * * *
    (w) * * *
          * * * * * * *
    (x) The falsification of a declaration of conformity 
submitted under subsection (c) of section 514 or the failure or 
refusal to provide data or information requested by the 
Secretary under section 514(c)(3).
          * * * * * * *

                            MISBRANDED FOOD

    Sec. 403. * *  *
          * * * * * * *
    (r)(1) * * *
          * * * * * * *
    (3)(A) * * *
          * * * * * * *
    (C) Notwithstanding the provisions of clauses (A)(i) and 
(B), a claim of the type described in subparagraph (1)(B) that 
is not authorized by the Secretary in a regulation promulgated 
in accordance with clause (B) shall be authorized and may be 
made if--
          (i) an authoritative scientific body of the Federal 
        Government with official responsibility for public 
        health protection or research directly relating to 
        human nutrition (such as the National Institutes of 
        Health or the Centers for Disease Control and 
        Prevention), the National Academy of Sciences, or a 
        subdivision of the scientific body or the National 
        Academy of Sciences, has published an authoritative 
        statement, which is currently in effect, about the 
        relationship betweena nutrient and a disease or health-
related condition to which the claim refers;
          (ii) a person has submitted to the Secretary at least 
        90 days before the first introduction of a food into 
        interstate commerce a notice of the claim, including a 
        concise description of the basis upon which such person 
        relied for determining that the requirements of 
        subclause (i) have been satisfied;
          (iii) the claim and the food for which the claim is 
        made are in compliance with clause (A)(ii), and are 
        otherwise in compliance with paragraph (a) and section 
        201(n); and
          (iv) the claim is stated in a manner so that the 
        claim is an accurate representation of the 
        authoritative statement referred to in subclause (i) 
        and so that the claim enables the public to comprehend 
        the information provided in the claim and to understand 
        the relative significance of such information in the 
        context of a total daily diet.

For purposes of this paragraph, a statement shall be regarded 
as an authoritative statement of such a scientific body 
described in subclause (i) only if the statement is published 
by the scientific body and shall not include a statement of an 
employee of the scientific body made in the individual capacity 
of the employee.
    (D) A claim meeting the requirements of clause (C) may be 
made until--
          (i) such time as the Secretary issues a final 
        regulation under clause (B) prohibiting or modifying 
        the claim, and the regulations has become effective; or
          (ii) a district court of the United States in an 
        enforcement proceeding under chapter III has determined 
        that the requirements of clause (C) have not been met.
          * * * * * * *

                             food additives

                         Unsafe Food Additives

    Sec. 409. (a) A food additive shall, with respect to any 
particular use or intended use of such additives, be deemed to 
be unsafe for the purposes of the application of clause (2)(C) 
of section 402(a), unless--
          (1) it and its use or intended use conform to the 
        terms of an exemption which is in effect pursuant to 
        [subsection (i)] of this section; [or]
          (2) there is in effect, and it and its use or 
        intended use are in conformity with, a regulation 
        issued under this section prescribing the conditions 
        under which such additive may be safely used[.]; or
          (3) in the case of a food additive as defined in this 
        Act that is a food contact substance, there is--
                  (A) in effect, and such substance and the use 
                of such substance are in conformity with, a 
                regulation issued under this section 
                prescribing the conditions under which such 
                additive may be safely used; or
                  (B) a notification submitted under subsection 
                (h) that is effective.
[While such a regulation relating to a food additive is in 
effect, a food shall not, reason of bearing or containing such 
an additive in accordance with the regulation, be considered 
adulterated within the meaning of clause (1) of section 
402(a).]
While such a regulation relating to a food additive, or such a 
notification under subsection (h) relating to a food additive 
that is a food contact substance, is in effect, and has not 
been revoked pursuant to subsection (i), a food shall not, by 
reason of bearing or containing such a food additive in 
accordance with the regulation or notification, be considered 
adulterated under section 402(a)(1).

           Notification Relating to a Food Contact Substance

    (h)(1) Subject to such regulations as may be promulgated 
under paragraph (3), a manufacturer or supplier of a food 
contact substance may, at least 120 days prior to the 
introduction or delivery for introduction into interstate 
commerce of the food contact substance, notify the Secretary of 
the identity and intended use of the food contact substance, 
and of the determination of the manufacturer or supplier that 
the intended use of such food contact substance is safe under 
the standard described in subsection (c)(3)(A). The 
notification shall contain the information that forms the basis 
of the determination, the fee required under paragraph (5), and 
all information required to be submitted by regulations 
promulgated by the Secretary.
    (2)(A) A notification submitted under paragraph (1) shall 
become effective 120 days after the date of receipt by the 
Secretary and the food contact substance may be introduced or 
delivered for introduction into interstate commerce, unless the 
Secretary makes a determination within the 120-day period that, 
based on the data and information before the Secretary, such 
use of the food contact substance has not been shown to be safe 
under the standard described in subsection (c)(3)(A), and 
informs the manufacturer or supplier of such determination.
    (B) A decision by the Secretary to object to a notification 
shall constitute final agency action subject to judicial 
review.
    (C) In this paragraph, the term ``food contact substance'' 
means the substance that is the subject of a notification 
submitted under paragraph (1), and does not include a similar 
or identical substance manufactured or prepared by a person 
other than the manufacturer identified in the notification.
    (3)(A) The process in this subsection shall be utilized for 
authorizing the marketing of a food contact substance except 
where the Secretary determines that submission and review of a 
petition under subsection (b) is necessary to provide adequate 
assurance of safety, or where the Secretary and any 
manufacturer or supplier agree that such manufacturer or 
supplier may submit a petition under subsection (b).
    (B) The Secretary is authorized to promulgate regulations 
to identify the circumstances in which a petition shall be 
filed under subsection (b), and shall consider criteria such as 
the probable consumption of such food contact substance and 
potential toxicity of the food contact substance in determining 
the circumstances in which a petition shall be filed under 
subsection (b).
    (4) The Secretary shall keep confidential any information 
provided in a notification under paragraph (1) for 120 days 
after receipt by the Secretary of the notification. After the 
expiration of such 120 days, the information shall be available 
to any interested party except for any matter in the 
notification that is a trade secret or confidential commercial 
information.
    (5)(A) Each person that submits a notification regarding a 
food contact substance under this section shall be subject to 
the payment of a reasonable fee. The fee shall be based on the 
resources required to process the notification including 
reasonable administrative costs for such processing.
    (B) The Secretary shall conduct a study of the costs of 
administering the notification program established under this 
section and, on the basis of the results of such study, shall, 
within 18 months after the date of enactment of the Food ad 
Drug Administration Modernization and Accountability Act of 
1997, promulgate regulations establishing the fee required by 
subparagraph (A).
    (C) A notification submitted without the appropriate fee is 
not complete and shall not become effective for the purposes of 
subsection (a)(3) until the appropriate fee is paid.
    (D) Fees collected pursuant to this subsection--
          (i) shall not be deposited as an offsetting 
        collection to the appropriations for the Department of 
        Health and Human Services;
          (ii) shall be credited to the appropriate account of 
        the Food and Drug Administration; and
          (iii) shall be available in accordance with 
        appropriation Acts until expended, without fiscal year 
        limitation.
    (6) In this section, the term ``food contact substance'' 
means any substance intended for use as a component of 
materials used in manufacturing, packing, packaging, 
transporting, or holding food if such use is not intended to 
have any technical effect in such food.

                   Amendment or Repeal of Regulations

    [h] (i) The Secretary shall by regulation prescribe the 
procedure by which regulations under the foregoing provisions 
of this section may be amended or repealed, and such procedure 
shall conform to the procedure provided in this section for the 
promulgation of such regulations.

                   Exemptions for Investigational Use

    [i] (j) Without regard to [subsections (b) to (h)] 
subsections (b) to (i), inclusive, of this section, the 
Secretary shall be regulation provide for exempting from the 
requirements of this section any food additive, and any food 
bearing or containing such additive, intended solely for 
investigational use by qualified experts when in his opinion 
such exemption is consistent with the public health.
          * * * * * * *

                      CHAPTER V--DRUGS AND DEVICES

                    Subchapter A--Drugs and Devices

                     adulterated drugs and devices

    Sec. 501. A drug or device shall be deemed to be 
adulterated--
    (a)(1) If it consists in whole or in part of any filthy, 
putrid, or decomposed substance; or (2)(A) if it has been 
prepared, packed, or held under insanitary conditions whereby 
it may have been contaminated with filth, or whereby it may 
have been rendered injurious to health; or (B) if it is a drug 
and the methods used in, or the facilities or controls used 
for, its manufacture, processing, packing, or holding do not 
conform to or are not operated or administered in conformity 
with current good manufacturing practice to assure that such 
drug meets the requirements of this Act as to safety and has 
the identity and strength, and meets the quality and purity 
characteristics, which it purports or is represented to 
possess[; or (3)]; or (C) if it is a compounded positron 
emission tomography drug and the methods used in, or the 
facilities and controls used for, its compounding, processing, 
packing, or holding do not conform to or are not operated or 
administered in conformity with the positron emission 
tomography compounding standards and the official monographs of 
the United States Pharmacopoeia to assure that such drug meets 
the requirements of this Act as to safety and has the identity 
and strength, and meets the quality and purity characteristics, 
which it purports or is represented to possess; or (3) if its 
container is composed, in whole or in part, of any poisonous or 
deleterious substance which may render the contents injurious 
to health; or (4) if (A) it bears or contains, for purposes of 
coloring only, a color additive which is unsafe within the 
meaning of section 721(a), or (B) it is a color additive the 
intended use of which in or on drugs or devices is for purposes 
of coloring only and is unsafe within the meaning of section 
721(a); or (5) if it is a new animal drug which is unsafe 
within the meaning of section 512; or (6) if it is an animal 
feed bearing or containing a new animal drug, and such animal 
feed is unsafe within the meaning of section 512.
          * * * * * * *
    [(e)] (e)(1) If it is, or purports to be or is represented 
as, a device which is subject to a performance standard 
established under section 514, unless such device is in all 
respects in conformity with such standard.
    (2) If it is, declared to be, purports to be, or is 
represented as, a device that is in conformity with any 
performance standard recognized under section 514(c) unless 
such device is in all respects in conformity with such 
standard.
          * * * * * * *

                      misbranded drugs and devices

    Sec. 502. * * *
          * * * * * * *
    (u) In the case of a health care economic statement that is 
included in labeling or advertising provided to formulary 
committee, managed care organization, or similar entity with 
responsibility for drug selection decisions (other than the 
label or approved physician package insert) relating to an 
indication approved under section 505 or 351 of the Public 
Health Service Act (42 U.S.C. 262), if the health care economic 
statement is not based on competent and reliable scientific 
evidence. The only requirement applicable to any such statement 
under this Act shall be the requirements of this paragraph. In 
this paragraph, the term ``health care economic statement'' 
means any statement that identifies, measures, or compares the 
costs (direct, indirect, and intangible) and health care 
consequences of a drug to another drug, to another health care 
intervention for the same indication, or to no intervention, 
where the primary endpoint is an economic outcome.

     exemptions and considerations for certain drugs, devices, and 
                          biological products

    Sec 503. * * *
          * * * * * * *
    (b)(1) A drug intended for use by man which--
          * * * * * * *
          [(A) is a habit-forming drug to which section 502(d) 
        applies; or]
          [(B)] (A) because of its toxicity or other 
        potentiality for harmful effect, or the method of its 
        use, or the collateral measures necessary to its use, 
        is not safe for use except under the supervision of a 
        practitioner licensed by law to administer such drug; 
        or
          [(C)] (B) is limited by an approved application under 
        section 505 to use under the professional supervision 
        of a practitioner licensed by law to administer such 
        drug;
          * * * * * * *
    (3) The Secretary may by regulation remove drugs subject to 
[section 502(d) and] section 505 from the requirements of 
paragraph (1) of this subsection when such requirements are not 
necessary for the protection of the public health.
    [(4) A drug which is subject to paragraph (1) of this 
subsection shall be deemed to be misbranded if at any time 
prior to dispensing its label fails to bear the statement 
``Caution: Federal law prohibits dispensing without 
prescription.'' A drug to which paragraph (1) of this 
subsection does not apply shall be deemed to be misbranded if 
at any time prior to dispensing its label bears the caution 
statement quoted in the preceding sentence.]
    (4)(A) A drug that is subject to paragraph (1) shall be 
deemed to be misbranded if at any time prior to dispensing the 
label of the drug fails to bear, at a minimum, the symbol ``Rx 
only''.
    (B) A drug to which paragraph (1) does not apply shall be 
deemed to be misbranded if at any time prior to dispensing the 
label of the drug bears the symbol described in subparagraph 
(A).
          * * * * * * *
    (g)(1) * * *
          * * * * * * *
    (4) As used in this subection:
          (A) The term ``biological product'' has the meaning 
        given the term in [section 351(a)] section 351(i) [of 
        the Public Health Service Act (42 U.S.C. [262(a)] 
        262(i)).
          (B) The term ``market clearance'' includes--
                  (i) approval of an application under section 
                505, 507, 515, or 520(g),
                  (ii) a finding of substantial equivalence 
                under this subchapter, and
                  (iii) approval of a [product or establishment 
                license under subsection (a) or (d)] biologics 
                license application under subsection (a) of 
                section 351 of the Public Health Service Act 
                (42 U.S.C. 262).
           * * * * * * *
    (h)(1) Sections 502(a)(2)(B), 502(f)(1), 502(l), 505, and 
507 shall not apply to a drug product if--
          (A) the drug produce is compounded for an identified 
        individual patient based on a medical need for 
        compounded product--
                  (i) by a licensed pharmacist in a State 
                licensed pharmacy or a Federal facility, or a 
                licensed physician on the prescription order of 
                a licensed physician or other licensed 
                practitioner authorized by State law to 
                prescribe drugs; or
                  (ii) by a licensed pharmacist or licensed 
                physician in limited quantities, prior to the 
                receipt of a valid prescription order for the 
                identified individual patient, and is 
                compounded based on a history of the licensed 
                pharmacist or licensed physician receiving 
                valid prescription orders for the compounding 
                of the drug product that have been generated 
                solely within an established relationship 
                between the licensed pharmacist, or licensed 
                physician, and--
                          (I) the individual patient for whom 
                        the prescription order will be 
                        provided; or
                          (II) the physician or other licensed 
                        practitioner who will write such 
                        prescription order; and
          (B) the licensed pharmacist or licensed physician--
                  (i) compounds the drug product using bulk 
                drug substances--
                          (I) that--
                                  (aa) comply with the 
                                standards of an applicable 
                                United States Pharmacopeia 
                                monograph; or
                                  (bb) in a case in which such 
                                a monograph does not exist, or 
                                drug substances that are 
                                covered by regulations issued 
                                by the Secretary under 
                                paragraph (3);
                          (II) that are manufactured by an 
                        establishment that is registered under 
                        section 510 (including a foreign 
                        establishment that is registered under 
                        section 510(i)); and
                          (III) that are accompanied by valid 
                        certificates of analysis for each bulk 
                        drug substance;
                  (ii) compounds the drug product using 
                ingredients (other than bulk drug substances) 
                that comply with the standards of an applicable 
                United States Pharmacopeia monograph and the 
                United States Pharmacopeia chapter on pharmacy 
                compounding;
                  (iii) only advertises or promotes the 
                compounding service provided by the licensed 
                pharmacist or licensed physician and does not 
                advertise or promote the compounding of any 
                particular drug, class of drug, or type of 
                drug;
                  (iv) does not compound a drug product that 
                appears on a list published by the Secretary in 
                the Federal Register of drug products that have 
                been withdrawn or removed from the market 
                because such drug products or components of 
                such drug products have been found to be unsafe 
                or not effective;
                  (v) does not compound a drug product that is 
                identified by the Secretary in regulation as 
                presenting demonstrable difficulties for 
                compounding that reasonably demonstrate an 
                adverse effect on the safety or effectiveness 
                of that drug product; and
                  (vi) does not distribute compounded drugs 
                outside of the State in which the drugs are 
                compounded, unless the principal State agency 
                of jurisdiction that regulates the practice of 
                pharmacy in such State has entered into a 
                memorandum of understanding with the Secretary 
                (based on the adequate regulation of 
                compounding performed in the State) that 
                provides for appropriate investigation by the 
                State agency of complaints relating to 
                compounded products distributed outside of the 
                State.
    (2)(A) The Secretary shall, after consultation with the 
National Association of Boards of Pharmacy, develop a standard 
memorandum of understanding for use by States in complying with 
paragraph (1)(B)(vi).
    (B) Paragraph (1)(B)(vi) shall not apply to a licensed 
pharmacist or licensed physician, who does not distribute 
inordinate amounts of compounded products outside of the State, 
until--
          (i) the date that is 180 days after the development 
        of the standard memorandum of understanding; or
          (ii) the date on which the State agency enters into a 
        memorandum of understanding under paragraph (1)(B)(vi), 
        whichever occurs first.
    (3) The Secretary, after consultation with the United 
States pharmacopeia Convention Incorporated, shall promulgate 
regulations limiting compounding under paragraph 
(1)(B)(i)(I)(bb) to drug substances that are components of drug 
products approved by the Secretary and to other drug substances 
as the Secretary may identify.
    (4) The provisions of paragraph (1) shall not apply--
          (A) to compounded positron emission tomography drugs 
        as defined in section 202(jj); or
          (B) to radiopharmaceuticals.
          * * * * * * *

                               new drugs

    Sec. 505. [355] (a) * * *
           * * * * * * *
    (4) A new drug manufactured in a pilot or other small 
facility may be used to demonstrate the safety and 
effectiveness of the new drug and to obtain approval of the new 
drug prior to scaling up to a larger facility, unless the 
Secretary determines that a full scale production facility is 
necessary to ensure the safety or effectiveness of the new 
drug.
           * * * * * * *
    (d) If the Secretary finds, after due notice to the 
applicant in accordance with subsection (c) and giving him an 
opportunity for a hearing, in accordance with said subsection, 
that (1) the investigations, reports of which are required to 
be submitted to the Secretary pursuant to subsection (b), do 
not include adequate tests by all methods reasonably applicable 
to show whether or not such drug is safe for use under the 
conditions prescribed, recommended or suggested in the proposed 
labeling thereof; (2) the results of such tests show that such 
drug is unsafe for use under such conditions or do not show 
that such drug is safe for use under such conditions; (3) the 
methods used in, and the facilities and controls used for, the 
manufacture, processing, and packing of such drug are 
inadequate to preserve its identity, strength, quality, and 
purity; (4) upon the basis of the information submitted to him 
as part of the application, or upon the basis of any other 
information before him with respect to such drug, he has 
insufficient information to determine whether such drug is safe 
for use under such conditions; or (5) evaluated on the basis of 
the information submitted to him as part of the application and 
any other information before him with respect to such drug, 
there is a lack of substantial evidence that the drug will have 
the effect it purports or is represented to have under the 
conditions of use prescribed, recommended, or suggested in the 
proposed labeling thereof; or (6) the application failed to 
contain the patent information prescribed by subsection (b); or 
(7) bad on a fair evaluation of all material facts, such 
labeling is false or misleading in any particular; he shall 
issue an order refusing to approve he application. If, after 
such notice and opportunity for hearing, the Secretary finds 
that clauses (1) through (6) do not apply, he shall issue an 
order approving the application. As used in this subsection and 
subsection (e), the term ``substantial evidence'' means 
evidence consisting of adequate and well-controlled 
investigations, including clinical investigations, by experts 
qualified by scientific training and experience to evaluate the 
effectiveness of the drug involved, on the basis of which it 
could fairly and responsibly be concluded by such experts that 
the drug will have the effect it purports or is represented to 
have under the conditions of used prescribed, recommended, or 
suggested in the labeling or proposed labeling thereof. 
Substantial evidence may, as appropriate, consist of data from 
1 adequate and well-controlled clinical investigation and 
confirmatory evidence (obtained prior to or after such 
investigation), if the Secretary determines, based on relevant 
science, that such data and evidence are sufficient to 
establish effectiveness.
           * * * * * * *
    (n) The provisions of subsections (a) and (j) shall not 
apply to the preparation of a compounded positron emission 
tomography drug.

SEC. 505A. PEDIATRIC STUDIES OF DRUGS.

    (a) Market Exclusivity for New Drugs.--If, prior to 
approval of an application that is submitted under section 
505(b)(1) the Secretary determines that information relating to 
the use of a drug in the pediatric population may produce 
health benefits in that population, the Secretary makes a 
written request for pediatric studies (which may include a 
timeframe for completing such studies), and such studies are 
completed within any such timeframe and the reports thereof 
submitted in accordance with subsection (d)(2) or completed 
within any such timeframe and the reports thereof are accepted 
in accordance with subsection (d)(3)--
          (1)(A) the period during which an application may not 
        be submitted under subsections (c)(3)(D)(ii) and 
        (i)(4)(D)(ii) of section 505 shall be five years and 
        six months rather than five years, and the references 
        in subsections (c)(3)(D)(ii) and (j)(4)(D)(ii) of 
        section 505 to four years, to forty-eight months, and 
        to seven and one-half years shall be deemed to be four 
        and one-half years, fifty-four months, and eight years, 
        respectively; or
          (B) the period of market exclusivity under 
        subsections (c)(3)(D) (iii) and (iv) and (j)(4)(D) 
        (iii) and (iv) of section 505 shall be three years and 
        six months rather than three years; and
          (2)(A) if the drug is the subject of--
                  (i) a listed patent for which a certification 
                has been submitted under section 
                505(b)(2)(A)(ii) or section (j)(2)(A)(vii)(II) 
                and for which pediatric studies were submitted 
                prior to the expiration of the patent 
                (including any patent extensions); or
                  (ii) a listed patent for which a 
                certification has been submitted undersection 
505(b)(2)(A(iii) or section 505(j)(2)(A)(vii)(III),
        the period during which an application may not be 
        approved under section 505(c)(3) or section 
        505(j)(4)(B) shall be extended by a period of six 
        months after the date the patent expires (including any 
        patent extensions); or
          (B) if the drug is the subject of a listed patent for 
        which a certification has been submitted under section 
        505(b)(2)(A)(iv) or section 505(j)(2)(A)(vii)(IV), and 
        in the patent infringement litigation resulting from 
        the certification the court determines that the patent 
        is valid and would be infringed, the period during 
        which an application may not be approved under section 
        505(c)(3) or section 505(j)(4)(B) shall be extended by 
        a period of six months after the date the patent 
        expires (including any patent extensions).
    (b) Secretary To Develop List of Drugs for Which Additional 
Pediatric Information May Be Beneficial.--Not later than 180 
days after the date of enactment of this section, the 
Secretary, after consultation with experts in pediatric 
research (such as the American Academy of Pediatrics, the 
Pediatric Pharmacology Research Unit Network, and the United 
States Pharmacopoeia) shall develop, prioritize, and publish an 
initial list of approved drugs for which additional pediatric 
information may produce health benefits in the pediatric 
population. The Secretary shall annually update the list.
    (c) Market Exclusivity for Already-Marketed Drugs.--If the 
Secretary makes a written request for pediatric studies (which 
may include a timeframe for completing such studies) concerning 
a drug identified in the list described in subsection (b) to 
the holder of an approved application under section 505(b)(1) 
for the drug, the holder agrees to the request, and the studies 
are completed within any such timeframe and the reports thereof 
submitted in accordance with subsection (d)(2) or completed 
within any such timeframe and the reports thereof accepted in 
accordance with subsection with subsection (d)(3)--
          (1)(A) the period during which an application may not 
        be submitted under subsections (c)(3)(D)(ii) and 
        (j)(4)(D)(ii) of section 505 shall be five years and 
        six months rather than five years, and the references 
        in subsections (c)(3)(D)(ii) and (j)(4)(D)(ii) of 
        section 505 to four years, to forty-eight months, and 
        to seven and one-half years shall be deemed to be four 
        and one-half years, fifty-four months, and eight years, 
        respectively; or
          (B) the period of market exclusively under 
        subsections (c)(3)(D) (iii) and (iv) and (j)(4)(D) 
        (iii) and (iv) of section 505 shall be three years and 
        six months rather than three years; and
          (2)(A) if the drug is the subject of--
                  (i) listed patent for which a certification 
                has been submitted under section 
                505(b)(2)(A)(ii) or (j)(2)(A)(vii)(II) and for 
                which pediatric studies were submitted prior to 
                the expiration of the patent (including any 
                patent extensions); or
                  (ii) a listed patent for which a 
                certification has been submitted under section 
                505(b)(2)(A)(iii) or section 
                505(j)(2)(A)(vii)(III),
        the period during which an application may not be 
        approved under section 505(c)(3) or section 
        505(j)(4)(B) shall be extended by a period of six 
        months after the date the patent expires (including any 
        patent extensions); or
          (B) if the drug is the subject of a listed patent for 
        which a certification has been submitted under section 
        505(b)(2)(A)(iv) or section 505(j)(2)(A)(vii)(IV), and 
        in the patent infringement litigation resulting from 
        the certification the court determines that the patent 
        is valid and would be infringed, the period during 
        which an application may not be approved under section 
        505(c)(3) or section 505(j)(4)(B) shall be extended by 
        a period of six months after the date the patent 
        expires (including any patent extensions).
    (d) Conduct of Pediatric Studies.--
          (1) Agreement for studies.--The Secretary may, 
        pursuant to a written request for studies, after 
        consultation with--
                  (A) the sponsor of an application for an 
                investigational new drug under section 505(i);
                  (B) the sponsor of an application for a drug 
                under section 505(b)(1); or
                  (C) the holder of an approved application for 
                a drug under section 505(b)(1),
          agree with the sponsor or holder for the conduct of 
        pediatric studies for such drug.
          (2) Written protocols to meet the studies 
        requirement.--If the sponsor or holder and the 
        Secretary agree upon written protocols for the studies, 
        the studies requirement of subsection (a) or (c) is 
        satisfied upon the completion of the studies and 
        submission of the reports thereof in accordance with 
        the original written request and the written agreement 
        referred to in paragraph (1). Not later than 60 days 
        after the submission of the report of the studies, the 
        Secretary shall determine if such studies were or were 
        not conducted in accordance with the original written 
        request and the written agreement and reported in 
        accordance with the requirements of the Secretary for 
        filing and so notify the sponsor or holder.
          (3) Other methods to meet the studies requirement.--
        If the sponsor or holder and the Secretary have not 
        agreed in writing on the protocols for the studies, the 
        studies requirement of subsection (a) or (c) is 
        satisfied when such studies have been completed and the 
        reports accepted by the Secretary. Not later than 90 
        days after the submission of the reports of the 
        studies, the Secretary shall accept or reject such 
        reports and so notify the sponsor or holder. The 
        Secretary's only responsibility in accepting or 
        rejecting the reports shall be to determine, within the 
        90 days, whether the studies fairly respond to the 
        written request, whether such studies have been 
        conducted in accordance with commonly accepted 
        scientific principles and protocols, and whether such 
        studies have been reported in accordance with the 
        requirements of the Secretary for filing.
    (e) Delay of Effective Date for Certain Applications; 
Period of Market Exclusivity.--If the Secretary determines that 
the acceptance or approval of an application under section 
505(b)(2) or 505(j) for a drug may occur after submission of 
reports of pediatric studies under this section, which were 
submitted prior to the expiration of the patent (including any 
patent extension) or market exclusivity protection, but before 
the Secretary has determined whether the requirements of 
subsection (d) have been satisfied, the Secretary shall delay 
the acceptance or approval under section 505(b)(2) or 505(j), 
respectively, until the determination under subsection (d) is 
made, but such delay shall not exceed 90 days. In the event 
that requirements of this section are satisfied, the applicable 
period of market exclusivity referred to in subsection (a) or 
(c) shall be deemed to have been running during the period of 
delay.
    (f) Notice of Determination on Studies Requirements.--The 
Secretary shall publish a notice of any determination that the 
requirements of subsection (d) have been met and that 
submissions and approvals under section 505(b)(2) or (j) for a 
drug will be subject to the provisions of this section.
    (g) Definitions.--As used in this section, the term 
``pediatric studies'' or ``studies'' means at least 1 clinical 
investigation (that, at the Secretary's discretion, may include 
pharmacokinetic studies) in pediatric age-groups in which a 
drug is anticipated to be used.
    (h) Limitation.--The holder of an approved application for 
a new drug that has already received six months of market 
exclusivity under subsection (a) or (c) may, if otherwise 
eligible, obtain six months of market exclusivity under 
subsection (c)(1)(B) for a supplemental application, except 
that the holder is not eligible for exclusivity under 
subsection(c)(2).
    (i) Sunset.--No period of market exclusivity shall be 
granted under this section based on studies commenced after 
January 1, 2004. The Secretary shall conduct at study and 
report to Congress not later than January 1, 2003 based on the 
experience under the program. The study and report shall 
examine all relevant issues, including--
          (1) the effectiveness of the program in improving 
        information about important pediatric uses for approved 
        drugs;
          (2) the adequacy of the incentive provided under this 
        section;
          (3) the economic impact of the program; and
          (4) any suggestions for modification that the 
        Secretary deems appropriate.
          * * * * * * *

             registration of producers of drugs and devices

    Sec. 510. [360] (a) As used in this section--
          * * * * * * *
          (4) any distributor who acts as a wholesale 
        distributor of devices, and who does not manufacture, 
        repackage, process, or relabel a device; or
          [4)] (5) such other classes of persons as the 
        Secretary may be regulation exempt from the application 
        of this section upon a finding that registration by 
        such classes of persons in accordance with this section 
        is not necessary for the protection of the public 
        health.
In this subsection, the term ``wholesale distributor'' means 
any person who distributes a device from the original place of 
manufacture to the person who makes the final delivery or sale 
of the device to the ultimate consumer or user.
          * * * * * * *
    [(i) Any establishment within any foreign country engaged 
in the manufacture, preparation, propagation, compounding, or 
processing of a drug or drugs or a device or devices, shall be 
permitted to register under this section pursuant to 
regulations promulgated by the Secretary. Such regulations 
shall require such establishment to provide the information 
required by section (j) and shall require such establishment to 
provide information required by subsection (j) in the case of a 
device or devices and shall include provisions for registration 
of any such establishment upon condition that adequate and 
effective means are available, by arrangement with the 
government of such foreign country or otherwise, to enable the 
Secretary to determine from time to time whether drugs or 
devices manufactured, prepared, propagated, compounded, or 
processed in such establishment, if imported or offered for 
import into the United States, shall be refused admission on 
any of the grounds set forth in section 801(a) of this Act.]
    (i)(1) Any establishment within any foreign country engaged 
in the manufacture, preparation, propagation, compounding, or 
processing of a drug or a device that is imported or offered 
for import into the United States shall register with the 
Secretary the name and place of business of the establishment 
and the name of the United States agent for the establishment.
    (2) The establishment shall also provide the information 
required by subsection (j).
    (3) The Secretary is authorized to enter into cooperative 
arrangements with foreign countries to ensure that adequate and 
effective means are available for purposes of determining, from 
time to time, whether drugs or devices manufactured, prepared, 
propagated, compounded, or processed by an establishment 
described in paragraph (1), if imported or offered for import 
into the United States, shall be refused admission on any of 
the grounds set forth in section 801(a).
          * * * * * * *
    (k) Each person who is required to register under this 
section and who proposes to begin the introduction or delivery 
for introduction into interstate commerce for commercial 
distribution of a device [intended for human use] intended for 
human use (except a device that is classified into class I 
under section 513 or 520 unless the Secretary determines such 
device is intended for a use which is of substantial importance 
in preventing impairment of human health, or presents a 
potential unreasonable risk of illness or injury, or a device 
that is classified into class II under section 513 or 520 and 
is exempt from the requirements of this subsection under 
subsection (l)) shall, at least ninety days before making such 
introduction or delivery, report to the Secretary (in such form 
and manner as the Secretary shall by regulation prescribe--
          * * * * * * *
The Secretary shall review the notification required by this 
subsection and make a determination under section 513(f)(1) not 
later than 90 days after receiving the notification.
    (l)(1) Not later than 30 days after the date of enactment 
of this subsection, the Secretary shall publish in the Federal 
Register a list of each type of class II device that does not 
require a notification under subsection (k) to provide 
reasonable assurance of safety and effectiveness. Each type of 
class II device identified by the Secretary not to require the 
notification shall be exempt from the requirement to provide 
notification under subsection (k) as of the date of the 
publication of the list in the Federal Register.
    (2) Beginning on the date that is 1 day after the date of 
the publication of a list under this subsection, the Secretary 
may exempt a class II device from the notification requirement 
subsection (k), upon the Secretary's own initiative or a 
petition of an interested person, if the Secretary determines 
that such notification is not necessary to assure the safety 
and effectiveness of the device. The Secretary shall publish in 
the Federal Register notice of the intent of the Secretary to 
exempt the device, or of the petition, and provide a 30-day 
comment period for public comment. Within 120 days after the 
issuance of the notice in the Federal Register, the Secretary 
shall publish an order in the Federal Register that sets forth 
the final determination of the Secretary regarding the 
exemption of the device that was the subject of the notice.
    (m)(l) The Secretary may not withhold a determination of 
the initial classification of a device under section 513(f)(1) 
because of a failure to comply with any provision of this Act 
that is unrelated to a substantial equivalence decision, 
including a failure to comply with the requirements relating to 
good manufacturing practices under section 520(f).
           * * * * * * *

            classification of devices intended for human use

                             Device Classes

    Sec. 513 [360c] (a)(1) * * *
          * * * * * * *
    (3)(A) Except as authorized by subparagraph (B), the 
effectiveness of a device is, for purposes of this section and 
sections 514 and 515, to be determined, in accordance with 
regulations promulgated by the Secretary, on the basis of well-
controlled investigations, including [clinical investigations] 
1 or more clinical investigations where appropriate, by experts 
qualified by training and experience to evaluate the 
effectiveness of the device, from which investigations it can 
fairly and responsibly be concluded by qualified experts that 
the device will have the effect it purports or is represented 
to have under the conditions of use prescribed, recommended, or 
suggested in the labeling of the device.
          * * * * * * *
    (C)(i)(I) The Secretary, upon the written request of any 
person intending to submit an application under section 515, 
shall meet with such person to determine the type of valid 
scientific evidence (within the meaning of subparagraphs (A) 
and (B)) that will be necessary to demonstrate the 
effectiveness of a device for the conditions of use proposed by 
such person, to support an approval of an application. The 
written request shall include a detailed description of the 
device, a detail description of the proposed conditions of use 
of the device, and, if available, information regarding the 
expected performance from the device. Within 30 days after such 
meeting, the Secretary shall specify in writing the type of 
valid scientific evidence that will provide a reasonable 
assurance that a device is effective under the conditions of 
use proposed by such person.
    (II) Any clinical data, including 1 or more well-controlled 
investigations, specified in writing by the Secretary for 
demonstrating a reasonable assurance of device effectiveness 
shall be specified as a result of a determination by the 
Secretary--
          (aa) that such data are necessary to establish device 
        effectiveness; and
          (bb) that no other less burdensome means of 
        evaluating device effectiveness is available that would 
        have a reasonable likelihood of resulting in an 
        approval.
    (ii) The determination of the Secretary with respect to the 
specification of valid scientific evidence under clause (i) 
shall be binding upon the Secretary, unless--
          (I) such determination by the Secretary would be 
        contrary to the public health; or
          (II) based on new information (other than the 
        information reviewed by the Secretary in making such 
        determination) obtained by the Secretary prior to the 
        approval of an application for an investigational 
        device exemption under section 520(g), the Secretary 
        finds that such determination is scientifically 
        inappropriate.
          * * * * * * *
    (f)(1) * * *
          * * * * * * *
          (B) the Secretary in response to a petition submitted 
        under [paragraph (2)] paragraph (3) has classified such 
        device in class I or II.
A device classified in class III under this paragraph shall be 
classified in that class until the effective date of an order 
of the Secretary under [paragraph (2)] paragraph (2) or (3) 
classifying the device in class I or II.
    (2)(A) Any person who submits a report under section 510(k) 
for a type of device that has not been previously classified 
under this Act, and that is classified into class III under 
paragraph (1), may request, within 30 days after receiving 
written notice of such a classification, the Secretary to 
classify the device into class I or II under the criteria set 
forth in subparagraphs (A) through (C) subsection (a)(1). The 
person may, in the request, recommend to the Secretary a 
classification for the device. The request shall describe the 
device and provide detailed information and reasons for the 
recommended classification.
    (B)(i) Not later than 60 days after the date of the 
submission of the request under subparagraph (A) for 
classification of a device under the criteria set forth in 
subparagraphs (A) through (C) of subsection (a)(1), the 
Secretary shall by written order classify the device. Such 
classification shall be the initial classification of the 
device for purposes of paragraph (1) and any device classified 
under this paragraph into class I or II shall be a predicate 
device for determining substantial equivalence under paragraph 
(1).
    (ii) A device that remains in class III under this 
subparagraph shall be deemed to be adulterated with the meaning 
of section 501(f)(B) until approved under section 515 or 
exempted from such approval under section 520(g).
    (C) Within 30 days after the issuance of an order 
classifying a device under this paragraph, the Secretary shall 
publish a notice in the Federal Register announcing such 
classification.
    [(2)] (3)(A) The Secretary may initiate the 
reclassification of a device classified into class III under 
paragraph (1) of this subsection or the manufacturer or 
importer of a device classified under paragraph (1) may 
petition the Secretary (in such form and manner as he shall 
prescribe) for the issuance of an order classifying the device 
in class I or class II. Within thirty days of the filing of 
such a petition, the Secretary shall notify the petitioner for 
any deficiencies in the petition which prevent the Secretary 
from making a decision on the petition.
          * * * * * * *
    [(3)] (4) If a manufacturer reports to the Secretary under 
section 510(k) that a device is substantially equivalent to 
another device--
          * * * * * * *
          (C) Whenever the Secretary requests information to 
        demonstrate that the devices with differing 
        technological characteristics are substantially 
        equivalent, the Secretary shall only request 
        information that is necessary to make a substantial 
        equivalence determination. In making such a request, 
        the Secretary shall consider the least burdensome means 
        of demonstrating substantial equivalence and shall 
        request information accordingly.
          (D) The determinations of the Secretary under this 
        section and section 513(f)(1) with respect to the 
        intended use of a device shall be based on the intended 
        use included in proposed labeling of the device 
        submitted in a report under section 510(k).
          * * * * * * *

                         performance standards

                        Provisions of Standards

    Sec. 514. [360d] (a)(1) * * *
           * * * * * * *

                       Recognition of a Standard

    (c)(1)(A) In addition to establishing performance standards 
under this section, the Secretary may, by publication in the 
Federal Register recognize all or part of a performance 
standard established by a nationally or internationally 
recognized standard development organization for which a person 
may submit a declaration of conformity in order to meet 
premarket submission requirements or other requirements under 
this Act to which such standards are applicable.
    (B) If a person elects to use a performance standard 
recognized by the Secretary under subparagraph (A) to meet the 
requirements described in subparagraph (A), the person shall 
provide a declaration of conformity to the Secretary that 
certifies that the device is in conformity with such standard. 
A person may elect to use data, or information, other than data 
required by a standard recognized under subparagraph (A) to 
fulfill or satisfy any requirement under this Act.
    (2) The Secretary may withdraw such recognition of a 
performance standard through publication of a notice in the 
Federal Register that the Secretary will no longer recognize 
the standard, if the Secretary determines that the standard is 
no longer appropriate for meeting the requirements under this 
Act.
    (3)(A) Subject to subparagraph (B), the Secretary shall 
accept a declaration of conformity that a device is in 
conformity with a standard recognized under paragraph (1) 
unless the Secretary finds--
          (i) that the data or information submitted to support 
        such declaration does not demonstrate that the device 
        is in conformity with the standard identified in the 
        declaration of conformity; or
          (ii) that the standard identified in the declaration 
        of conformity is not applicable to the particular 
        device under review.
    (B) The Secretary may request, at any time, the data or 
information relied on by the person to make a declaration of 
conformity with respect to a standard recognized under 
paragraph (1).
    (C) A person relying on a declaration of conformity with 
respect to a standard recognized under paragraph (1) shall 
maintain the data and information demonstrating conformity of 
the device to the standard for a period of 2 years after the 
date of the classification or approval of the device by the 
Secretary or a period equal to the expected design life of the 
device, whichever is longer.
          * * * * * * *

                           premarket approval

                          General Requirement

    Sec. 515. [360e] (a) A class III device--

          * * * * * * *

            Action on an Application for Premarket Approval

    (d)(1)(A) * * *
          * * * * * * *
          (i) issue an order approving the application if he 
        finds that none of the grounds for denying approval 
        specified in [paragraph (2) of this subsection ] 
        paragraph 4 applies; or
          (ii) deny approval of the application if he finds 
        (and sets forth the basis for such finding as part of 
        or accompanying such denial) that one or more grounds 
        for denial specified in [paragraph (2) of this 
        subsection ] paragraph 4 apply.
In making the determination whether to approve or deny an 
application, the Secretary shall rely on the conditions of use 
proposed in the labeling of a device as the basis for 
determining whether or not there is a reasonable assurance of 
safety and effectiveness. If, based on a fair evaluation of all 
material facts, the proposed labeling is neither false nor 
misleading in any particular, the Secretary, in making the 
determination, shall not consider conditions of use not 
included in the proposed labeling.
    (2)(A)(i) The Secretary shall, upon the written request of 
the applicant involved, meet with the applicant not later than 
100 days after the receipt of an application, from the 
applicant, that has been filed as complete under subsection 
(c), to discuss the review status of the application.
    (ii) If the application does not appear in a form that 
would require an approval under this subsection, the Secretary 
shall in writing, and prior to the meeting, provide to the 
applicant a description of any deficiencies in the application 
identified by the Secretary and identify the information (other 
than information the Secretary needs to make a finding under 
paragraph (4)(C)) that is required to bring the application 
into an approvable form.
    (iii) The Secretary and the applicant may, by mutual 
consent, establish a different schedule for a meeting required 
under this paragraph.
    (B) The Secretary shall notify the applicant immediately of 
any deficiency identified in the application that was not 
described as a deficiency in the written description provided 
by the Secretary under subparagraph (A).
    (3) Except as provided in paragraph (1), the period for the 
review of an application by the Secretary under this subsection 
shall be not more than 180 days. Such period may not be 
restarted or extended even if the application is amended.
    [(2)] (4) The Secretary shall deny approval of an 
application for a device if, upon the basis of the information 
submitted to the Secretary as part of the application and any 
other information before him with respect to such device, the 
Secretary finds that--
          * * * * * * *
    [(3)] (5) An applicant whose application has been denied 
approval may, by petition filed on or before the thirtieth day 
after the date upon which he receives notice of such denial, 
obtain review thereof in accordance with either paragraph (1) 
or (2) of subsection (g), and any interested person may obtain 
review, in accordance with paragraph (1) or (2) of subsection 
(g), of an order of the Secretary approving an application.
          * * * * * * *
    (iii) The Secretary shall accept and review data and any 
other information from investigations conducted under the 
authority of regulations required by section 520(g), to make a 
determination of whether there is a reasonable assurance of 
safety and effectiveness of a device subject to a pending 
application under this section if--
          (I) the data or information is derived from 
        investigations of an earlier version of the device, the 
        device has been modified during or after the 
        investigations (but prior to submission of an 
        application under subsection (c)) and such a 
        modification of the device does not constitute a 
        significant change in the design or in the basic 
        principles of operation of the device that would 
        invalidate the data or information; or
          (II) the data or information relates to a device 
        approved under this section, is available for use under 
        this Act, and is relevant to the design and intended 
        use of the device for which the application is pending.
          * * * * * * *
    (6)(A)(i) A supplemental application shall be required for 
any change to a device subject to an approved application under 
this subsection that affects safety or effectiveness, unless 
such change is a modification in a manufacturing procedure or 
method of manufacturing and the holder of the approved 
application submits a written notice to the Secretary that 
describes in detail the change, summarizes the data or 
information supporting the change, and informs the Secretary 
that the change has been made under the requirements of section 
520(f).
    (ii) The holder of an approved application who submits a 
notice under clause (i) with respect to a manufacturing change 
of a device shall not distribute the device for a period of 14 
days after the date on which the Secretary receives the notice.
    (B)(i) Subject to clause (ii), in reviewing a supplement to 
an approved application, for an incremental change to the 
design of a device that affects safety or effectiveness, the 
Secretary shall approve such supplement if--
          (I) nonclinical data demonstrate that the design 
        modification creates the intended additional capacity, 
        function, or performance of the device; and
          (II) clinical data from the approved application and 
        any supplement to the approval application provide a 
        reasonable assurance of safety and effectiveness for 
        the changed device.
    (ii) The Secretary may require, when necessary, additional 
clinical data to evaluate the design modification to provide a 
reasonable assurance of safety and effectiveness.
          * * * * * * *

                            judicial review

                         Application of Section

    Sec. 517. [360g] (a) Not later than thirty days after--
           * * * * * * *
          (8) an order pursuant to section 513(i), or
          (9) a regulation under section 515(i)(2) or 
        520(l)(5)(B)[, or],
          [(10) an order under section 520(h)(4)(B),]
           * * * * * * *

                     notfication and other remedies

                              Notification

    Sec. 518. (a) If the Secretary determines that--
           * * * * * * *

                            Recall Authority

    (e)(1) * * *
           * * * * * * *
    (2)(A) If, after providing an opportunity for an informal 
hearing under paragraph (1), the Secretary determines that the 
order should be amended to include a recall of the device with 
respect to which the order was issued, the Secretary shall, 
except as provided in [subparagraphs (B) and (C)] subparagraph 
(B), amend the order to require a recall. The Secretary shall 
specify a timetable in which the device recall will occur and 
shall require periodic reports to the Secretary describing the 
progress of the recall.
           * * * * * * *
    (C) If the Secretary issues an amended order under 
subparagraph (A), the Secretary may require the person subject 
to the order to submit such samples of the device and of 
components of the device as the Secretary may reasonably 
require. If the submission of such samples is impracticable or 
unduly burdensome, the requirement of this subparagraph may be 
met by the submission of complete information concerning the 
location of 1 or more such devices readily available for 
examination and testing.
          * * * * * * *

                     records and reports on devices

                              General Rule

    Sec. 519. [360i] (a) Every person who is a manufacturer, 
importer, or distributor of a device intended for human use 
shall establish and maintain such records, [make such reports, 
and provide such information,] and submit such samples and 
components of devices (as required by paragraph (10)), as the 
Secretary may by regulation reasonably require to assure that 
such device is not adulterated or misbranded and to otherwise 
assure its safety and effectiveness. Every person who is a 
manufacturer or importer of a device intended for human use 
shall make reports, and provide such information, as the 
Secretary may by regulation reasonably require to assure that 
such device is not adulterated or misbranded and to assure the 
safety and effectiveness of such device. Regulations prescribed 
under the preceding [sentence] sentences--
          * * * * * * *
          (8) may not require a manufacturer, importer, or 
        distributor of a class I device to--
                  (A) maintain for such device records 
                respecting information not in the possession of 
                the manufacturer, importer, or distributor, or
                  (B) to submit for such a device to the 
                Secretary any report or information--
                          (i) not in the possession of the 
                        manufacturer, importer, or distributor, 
                        or
                          (ii) on a periodic basis,
        unless such report or information is necessary to 
        determine if the device should be reclassified or if 
        the device is adulterated or misbranded[; and];
          [(9) shall require distributors who submit such 
        reports to submit copies of the reports to the 
        manufacturer of the device for which the report was 
        made.]
          (9) shall require distributors to keep records and 
        make such records available to the Secretary upon 
        request; and
          (10) may reasonably require a manufacturer, importer, 
        or distributor to submit samples of a device and of 
        components of the device that may have caused or 
        contributed to a death or serious injury, except that 
        if the submission of such samples is impracticable or 
        unduly burdensome, the requirement of this paragraph 
        may be met by the submission of complete information 
        concerning the location of 1 or more such devices 
        readily available for examination and testing.

                             [Certification

    [(d) Each manufacturer, importer, and distributor required 
to make reports under subsection (a) shall submit to the 
Secretary annually a statement certifying that--
          [(1) the manufacturer, importer, or distributor did 
        file a certain number of such reports, or
          [(2) the manufacturer, importer, or distributor did 
        not file any report under subsection (a).]
          * * * * * * *

                  Reports of Removals and Corrections

    (f)(1) Except as provided in paragraph (2), the Secretary 
shall by regulation require a manufacturer[, importer, or 
distributor] or importer of a device to report promptly to the 
Secretary any correction or removal of a device undertaken by 
such manufacturer, importer, or distributor if the removal or 
correction was undertaken--
          (A) to reduce the risk to health posed by the device, 
        or
          (B) to remedy a violation of this Act caused by the 
        device which may present a risk to health.
A manfacturer[, importer, or distributor] or importer of a 
device who undertakes a correction or removal of a device which 
is not required to be reported under this paragraph shall keep 
a record of such correction or removal.
          * * * * * * *
    (e) * * *
          * * * * * * *
Any patient receiving a device subject to tracking under this 
section may refuse to release, or refuse permission to release, 
the patient's name, address, social security number, or other 
identifying information for the purpose of tracking.
          * * * * * * *

general provisions respecting control of devices intended for human use

                              General Rule

    Sec. 520. [360j] (a) * * *
          * * * * * * *
          (6)(A) The Secretary shall, not later than 120 days 
        after the date of enactment of this paragraph, by 
        regulation modify parts 812 and 813 of title 21, Code 
        of Federal Regulations to update the procedures and 
        conditions under which a device intended for human use 
        may, upon application by the sponsor of the device, be 
        granted an exemption from the requirements of this Act.
          (B) The regulation shall permit developmental changes 
        in a device (including manufacturing changes) in 
        response to information collected during an 
        investigation without requiring an additional approval 
        of an application for an investigational device 
        exemption or the approval of a supplemental to such 
        application, if the sponsor of the investigation 
        determines, based on credible information, prior to 
        making any such changes, that the changes--
                  (i) do not affect the scientific soundness of 
                an investigational plan submitted under 
                paragraph (3)(A) or the rights, safety, or 
                welfare of the human subjects involved in the 
                investigation; and
                  (i) do not constitute a significant change in 
                design, or a significant change in basis 
                principles of operation, of the device.
          [(4)(A) Any information contained in an application 
        for premarket approval filed with the Secretary 
        pursuant to section 515(c), including clinical and 
        preclinical tests or studies, but excluding 
        descriptions of methods of manufacture and product 
        composition, that demonstrates the safety and 
        effectiveness of a device shall be available 1 year 
        after the original application for the fourth device of 
        a kind has been approved by the Secretary, for use by 
        the Secretary in approving devices, or determining 
        whether a product development protocol has been 
        completed, under section 515, establishing a 
        performance standard under section 514, and 
        reclassifying devices under subsections (e) and (f) of 
        section 513, and subsection (l)(2). The Secretary shall 
        deem devices that incorporate the same technologies, 
        have the same principles of operation, and are intended 
        for the same use or uses to be within a kind of 
        device.]
          (4)(A) Any information contained in an application 
        for premarket approval filed with the Secretary 
        pursuant to section 515(c) (including information from 
        clinical and preclinical tests or studies that 
        demonstrate the safety and effectiveness of a device, 
        but excluding descriptions of methods of manufacture 
        and product composition) shall be available, 6 years 
        after the application has been approved by the 
        Secretary, for use by the Secretary in--
                  (i) approving another device;
                  (ii) determining whether a product 
                development protocol has been completed, under 
                section 515 for another device;
                  (iii) establishing a performance standard or 
                special control under section 514 for another 
                device; and
                  (iv) classifying or reclassifying another 
                device under section 513 and subsection (l)(2).
          (B) The publicly available detailed summaries of 
        information respecting the safety and effectiveness of 
        devices required by paragraph (l)(A) shall be available 
        for use by the Secretary as the evidentiary basis for 
        the agency action described in subparagraph (A).
          * * * * * * *

general provisions respecting control of devices intended for human use

                              General Rule

    Sec. 520. [360j] (a) * * *
          * * * * * * *
    (m)(1) * * *
          * * * * * * *
    The request shall be in the form of an application 
submitted to the Secretary. Not later than 60 days after the 
date of the receipt of the application, the Secretary shall 
issue an order approving or denying the application.
           * * * * * * *
          (4) Devices granted an exemption under paragraph (2) 
        may only be used--
           * * * * * * *
          (B) if, before the use of a device, an institutional 
        review committee approves the use in the treatment or 
        diagnosis of a disease or condition referred to in 
        paragraph (2)(A), unless a physician determines that 
        waiting for such an approval from an institutional 
        review committee will cause harm or death to a patient, 
        and makes a good faith effort to obtain the approval, 
        and does not receive a timely response from an 
        institutional review committee on the request of the 
        physician for approval to use the device for such 
        treatment or diagnosis.
        In a case in which a physician described in 
        subparagraph (B) uses a device without an approval from 
        an institutional review committee, the physician shall, 
        after the use of the device, notify the chairperson of 
        the institutional review committee of such use. Such 
        notification shall include the identification of the 
        patient involved, the date on which the device was 
        used, and the reason for the use.
           * * * * * * *
          [(5) An exemption under paragraph (2) shall be for a 
        term of 18 months and may only be initially granted in 
        the 5-year period beginning on the date regulations 
        under paragraph (6) take effect. The Secretary may 
        extend such an exemption for a period of 18 months if 
        the Secretary is able to make the findings set forth in 
        paragraph (2) and if the applicant supplies information 
        demonstrating compliance with paragraph (3). An 
        exemption may be extended more than once and may be 
        extended after the expiration of such 5-year period.]
          (5) The Secretary may require a person granted an 
        exemption under paragraph (2) to demonstrate continued 
        compliance with the requirements of this subsection if 
        the Secretary believes such demonstration to be 
        necessary to protect the public health or if the 
        Secretary has reason to believe that the criteria for 
        the exemption are no longer met.
          * * * * * * *

                        postmarket surveillance

    [Sec. 522. [3601] (a) In General.--
          (1) Required surveillance.--The Secretary shall 
        require a manufacturee to conduct postmarket 
        surveillance for any device of the manufacturer first 
        introduced or delivered for introduction into 
        interstate commerce after January 1, 1991, that--
                  (A) is a permanent implant the failure of 
                which may cause serious, adverse health 
                consequences or death,
                  (B) is intended for a use in supporting or 
                sustaining human life, or
                  (C) potentially presents a serious risk to 
                human health.
          (2) Discretionary surveillance.--The] Sec. 522. (a) 
        Discretionary Surveillance._The Secretary may require a 
        manufacturer to conduct postmarket surveillance for a 
        device of the manufacturer if the Secretary determines 
        that postmarket surveillance of the device is necessary 
        to protect the public health or to provide safety or 
        effectiveness data for the device.
    [(b) Surveillance Approval.--Each manufacturer required to 
conduct a surveillance of a device under subsection (a)(1) 
shall, within 30 days of the first introduction or delivery for 
introduction of such device into interstate commerce, submit, 
for the approval of the Secretary, a protocol for the required 
surveillance. Each manufacturer required to conduct a 
surveillance of a device under subsection (a)(2) shall within 
30 days after receiving notice that the manufacturer is 
required to conduct such surveillance, submit, for the approval 
of the Secretary, a protocol for the required surveillance. The 
Secretary, within 60 days of the receipt of such protocol, 
shall determine if the principal investigator proposed to be 
used in the surveillance has sufficient qualifications and 
experience to conduct such surveillance and if such protocol 
will result in collection of useful data or other information 
necessary to protect the public health and to provide safety 
and effectiveness information for the device. The Secretary may 
not approve such a protocol until it has been reviewed by an 
appropriately qualified scientific and technical review 
committee established by the Secretary.]
    (b) Surveillance Approval.--
          (1) In general.--Each manufacturer that receives 
        notice from the Secretary that the manufacturer is 
        required to conduct surveillance of a device under 
        subsection (a) shall, not later than 30 days after 
        receiving the notice, submit for the approval of the 
        Secretary, a plan for the required surveillance.
          (2) Determination.--Not later than 60 days after the 
        receipt of the plan, the Secretary shall determine if a 
        person proposed in the plan to conduct the surveillance 
        has sufficient qualifications and experience to conduct 
        the surveillance and if the plan will result in the 
        collection of useful data that can reveal unforeseen 
        adverse events or other information necessary to 
        protect the public health and to provide safety and 
        effectiveness information for the device.
          (3) Limitation on plan approval.--The Secretary may 
        not approve the plan until the plan has been reviewed 
        by a qualified scientific and technical review 
        committee established by the Secretary.
    (c) Duration of Surveillance.--
          (1) In general.--Each manufacturer required to 
        conduct surveillance of a device under subsection (a) 
        shall be required to conduct such surveillance for not 
        longer than 24 months.
          (2) Extension of the period of surveillance.--If the 
        Secretary determines that additional surveillance is 
        needed to identify the incidence of adverse events 
        documented during the initial period of surveillance 
        that were not foreseen at the time of approval or 
        classification of the device, the Secretary may extend 
        the period of surveillance for such time as may be 
        necessary after providing the person required to 
        conduct such surveillance an opportunity for an 
        informal hearing to determine whether or not additional 
        surveillance is appropriate and to determine the 
        appropriate period, if any, for such surveillance.
          * * * * * * *

SEC. 523. ACCREDITED-PARTY PARTICIPATION.

    (a) Accreditation.--
          (1) In general.--Not later than 1 year after the date 
        of enactment of this section, the Secretary shall 
        accredit entities or individuals who are not employees 
        of the Federal Government, to review reports made to 
        the Secretary under section 510(k) for devices and make 
        recommendations to the Secretary regarding the initial 
        classification of such devices under section 513(f)(1), 
        except that this paragraph shall not apply to reports 
        made to the Secretary under section 510(k) for devices 
        that are--
                  (A) life-supporting;
                  (B) life sustaining; or
                  (C) intended for implantation in the human 
                body for a period of over 1 year.
          (2) Special rule.--The Secretary shall have the 
        discretion to accredit entities or individuals who are 
        not employees of the Federal Government--
                  (A) to review reports made to the Secretary 
                under section 510(k) for devices described in 
                subparagraphs (A) through (C) of paragraph (1), 
                and make recommendations of initial 
                classification of such devices; or
                  (B) to review applications for premarket 
                approval for class III devices under section 
                515 and make recommendations with respect to 
                the approval or disapproval of such 
                applications.
    (b) Accreditation.--Within 180 days after the date of 
enactment of this section, the Secretary shall adopt methods of 
accreditation that ensure that entities or individuals who 
conduct reviews and make recommendations under this section are 
qualified, properly trained, knowledgeable about handling 
confidential documents and information, and free of conflicts 
of interest. The Secretary shall publish the methods of 
accreditation in the Federal Register on the adoption of the 
methods.
    (c) Withdrawal of Accreditation.--The Secretary may suspend 
or withdraw the accreditation of any entity or individual 
accredited under this section, after providing notice and an 
opportunity for an informal hearing, if such entity or 
individual acts in a manner that is substantially not in 
compliance with the requirements established by the Secretary 
under subsection (b), including the failure to avoid conflicts 
of interest, the failure to protect confidentiality of 
information, or the failure to competently review premarket 
submissions for devices.
    (d) Selection and Compensation.--Subject to subsection 
(a)(2), a person who intends to make a report described in 
subsection (a), or to submit an application described in 
subsection (a), to the Secretary shall have the option to 
select an accredited entity or individual to review such report 
or application. Upon the request by a person to have a report 
or application reviewed by an accredited entity or individual, 
the Secretary shall identify for the person no less than 2 
accredited entities or individuals from whom the selection may 
be made. Compensation for an accredited entity or individual 
shall be determined by agreement between the accredited entity 
or individual and the person who engages the services of the 
accredited entity or individual and shall be paid by the person 
who engages such services.
    (e) Review by Secretary.--
          (1) In general.--The Secretary shall require an 
        accredited entity or individual, upon making a 
        recommendation under this section with respect to an 
        initial classification of a device or approval or 
        disapproval of an application for premarket approval, 
        to notify the Secretary in writing of the reasons for 
        such recommendation.
          (2) Time period for review.--
                  (A) Initial classification.--Not later than 
                30 days after the date on which the Secretary 
                is notified under paragraph (1) by an 
                accredited entity or individual with respect to 
                a recommendation of an initial classification 
                of a device, the Secretary shall make a 
                determination with respect to the initial 
                classification.
                  (B) Premarket approval.--Not later than 60 
                days after the date on which the Secretary is 
                notified under paragraph (1) by an accredited 
                entity or individual with respect to a 
                recommendation of an approval or disapproval of 
                an application for a device, the Secretary 
                shall make a determination with respect to the 
                approval or disapproval.
          (3) Special rule.--The Secretary may change the 
        initial classification under section 513(f)(1), or the 
        approval or disapproval of the application under 
        section 515(d), that is recommended by the accredited 
        entity or individual under this section, and in such 
        case shall notify in writing the person making the 
        report or application described in subsection (a) of 
        the detailed reasons for the change.
    (f) Duration.--The authority provided by this section 
terminates--
          (1) 5 years after the date on which the Secretary 
        notifies Congress that at least 2 persons accredited 
        under subsection (b) are available to review devices 
        for each of at least 70 percent of the generic types of 
        devices subject to review under subsection (a); or
          (2) 4 years after the date on which the Secretary 
        notifies Congress that at least 35 percent of the 
        devices that are subject to review under subsection 
        (a), and that were the subject of final action by the 
        Secretary in the fiscal year preceding the date of such 
        notification, were reviewed by the Secretary under 
        subsection (e),
whichever occurs first.
    (g) Report.--
          (1) In general.--Not later than 1 year after the date 
        of enactment of this section, the Secretary shall 
        contract with an independent research organization to 
        prepare and submit to the Secretary a written report 
        examining the use of accredited entities and 
        individuals to conduct reviews under this section. The 
        Secretary shall submit the report to Congress not later 
        than 6 months prior to the conclusion of the applicable 
        period described in subsection (f).
          (2) Contents.--The report by the independent research 
        organization described in paragraph (1) shall identify 
        the benefits or detriments to public and patient health 
        of using accredited entities and individuals to conduct 
        such reviews, and shall summarize all relevant data, 
        including data on the review of accredited entities and 
        individuals (including data on the review times, 
        recommendations, and compensation of the entities and 
        individuals), and data on the review of the Secretary 
        (including data on the review times, changes, and 
        reasons for changes of the Secretary).
          * * * * * * *

           Subchapter D--Unapproved Therapies and Diagnostics

SEC. 551. EXPANDED ACCESS TO UNAPPROVED THERAPIES AND DIAGNOSTICS.

    (a) In General.--Any person, acting through a physician 
licensed in accordance with State law, may requestfrom a 
manufacturer or distributor, and any manufacturer or distributor may 
provide to a person after compliance with the provisions of this 
section, an investigational drug (including a biological product) or 
investigational device for the diagnosis, monitoring, or treatment of a 
serious disease or condition, or any other disease or condition 
designated by the Secretary as appropriate for expanded access under 
this section if--
          (1) the licensed physician determines that the person 
        has no comparable or satisfactory alternative therapy 
        available to diagnose, monitor, or treat the disease or 
        condition involved;
          (2) the licensed physician determines that the risk 
        to the person from the investigational drug or 
        investigational device is not greater than the risk 
        from the disease or condition;
          (3) the Secretary determines that an exemption for 
        the investigational drug or investigational device is 
        in effect under a regulation promulgated pursuant to 
        section 505(i) or 520(g) and the sponsor of the drug or 
        device and investigators comply with such regulation;
          (4) the Secretary determines that the manufacturer of 
        the investigational drug or investigational device is 
        actively pursuing marketing approval with due 
        diligence; and
          (5) the Secretary determines that expanded access to 
        the investigational drug or investigational device will 
        not interfere with adequate enrollment of patients by 
        the investigator in the ongoing clinical investigation 
        of the investigational drug or investigational device 
        authorized under section 505(i) or 520(g); and
          (6) the Secretary determines that there is sufficient 
        evidence of safety and effectiveness to support the 
        expanded use of the investigational drug or 
        investigational device in accordance with this section.
    (b) Protocols.--A manufacturer or distributor may submit to 
the Secretary 1 or more expanded access protocols covering 
expanded access use of a drug or device described in subsection 
(a). The protocols shall be subject to the provisions of 
section 505(i) or 520(g) and may include any form of use of the 
drug or device outside a clinical investigation, prior to 
approval of the drug or device for marketing including 
protocols for treatment use, emergency use, or uncontrolled 
trials, and single patient protocols. If the request for 
expanded access to an investigational drug or investigational 
device is intended for a single patient only, the Secretary may 
waive the requirements of paragraphs (3) and (4) of subsection 
(a) and accept a submission under sections 505(i) and 520(g) 
for an exemption for the investigational drug or 
investigational device for the single patient use. In the case 
of an emergency that does not allow sufficient time for a 
submission under section 505(i) or (520)(g), the Secretary may, 
prior to the submission, authorize the shipment of the 
investigational drug or investigational device for a single 
patient use.
    (c) Notification of Availability.--The Secretary shall 
inform national, State, and local medical associations and 
societies, voluntary health associations, and other appropriate 
persons about the availability of an investigational drug or 
investigational device under expanded access protocols 
submitted under this section, except that this subsection shall 
not apply to expanded access protocols for single patient use.
    (d) Termination.--The Secretary may at anytime terminate 
expanded access provided under subsection (a) for an 
investigational drug or investigational device if the 
requirements under this section are no longer met.
          * * * * * * *

                     Subchapter E--Fast Track Drugs

SEC. 561. FAST TRACK DRUGS.

    (a) Designation of Drug as a Fast Track Drug.--
          (1) In general.--The Secretary shall facilitate 
        development, and expedite review and approval of new 
        drugs and biological products that are intended for the 
        treatment of serious or life-threatening conditions and 
        that demonstrate the potential to address unmet medical 
        needs for such conditions. In this Act, such products 
        shall be known as ``Fast track drugs.''
          (2) Request for designation.--The sponsor of a drug 
        (including a biological product) may request the 
        Secretary to designate the drug as a fast track drug. A 
        request for the designation may be made concurrently 
        with, or at any time after, submission of an 
        application for the investigation of the drug under 
        section 505(i) or section 351(a)(4) of the Public 
        Health Service Act.
          (3) Designation.--Within 30 calendar days after the 
        receipt of a request under paragraph (2), the Secretary 
        shall determine whether the drug that is the subject of 
        the request meets the criteria described in paragraph 
        (1). If the Secretary finds that the drug meets the 
        criteria, the Secretary shall designate the drug as a 
        fast track drug and shall take such actions as are 
        appropriate to expedite the development and review of 
        the drug.
    (b) Approval of Application for a Fast Track Drug.--
          (1) In general.--The Secretary may approve an 
        application for approval of a fast track drug under 
        section 505(b) or section 351 of the Public Health 
        Service Act (21 U.S.C. 262) upon a determination that 
        the drug has an effect on a surrogate endpoint that is 
        reasonably likely to predict clinical benefit.
          (2) Limitation.--Approval of a fast track drug under 
        this subsection may be subject to the requirements--
                  (A) that the sponsor conduct appropriate 
                post-approval studies to validate the surrogate 
                endpoint or otherwise confirm the clinical 
                benefit of the drug; and
                  (B) that the sponsor submit copies of all 
                promotional materials related to the fast track 
                drug during the preapproval review period and 
                following approval, at least 30 days prior to 
                dissemination of the materials for such period 
                of time as the Secretary deems appropriate.
          (3) Expedited withdrawal of approval.--The Secretary 
        may withdraw approval of a fast track drug using 
        expedited procedures (as prescribed by the Secretary in 
        regulations) including a procedure that provides an 
        opportunity for an informal hearing, if--
                  (A) the sponsor fails to conduct any required 
                post-approval study of the fast track drug with 
                due diligence;
                  (B) a post-approval study of the fast track 
                drug fails to verify clinical benefit of the 
                fast track drug;
                  (C) other evidence demonstrates that the fast 
                track drug is not safe or effective under 
                conditions of use of the drug; or
                  (D) the sponsor disseminates false or 
                misleading promotional materials with respect 
                to the fast track drug.
    (c) Review of Incomplete Applications for Approval of a 
Fast Track Drug.--
          (1) In general.--If preliminary evaluation by the 
        Secretary of clinical efficacy data for a fast track 
        drug under investigation shows evidence of 
        effectiveness, the Secretary shall evaluate for filing, 
        and may commence review of portions, of an application 
        for the approval of the drug if the applicant provides 
        a schedule for submission of information necessary to 
        make the application complete and any fee that may be 
        required under section 736.
          (2) Exception.--Any time period for review of human 
        drug applications that has been agreed to by the 
        Secretary and that has been set forth in goals 
        identified in letters of the Secretary (relating to the 
        use of fees collected under section 736 to expedite the 
        drug development process and the review of human drug 
        applications) shall not apply to an application 
        submitted under paragraph (1) until the date on which 
        the application is complete.
    (d) Awareness Efforts.--The Secretary shall--
          (1) develop and widely disseminate to physicians, 
        patient organizations, pharmaceutical and biotechnology 
        companies, and other appropriate persons a 
        comprehensive description of the provisions applicable 
        to fast track drugs established under this section; and
          (2) establish an ongoing program to encourage the 
        development of surrogate endpoints that are reasonably 
        likely to predict clinical benefit for serious or life-
        threatening conditions for which there exist 
        significant unmet medical needs.
          * * * * * * *

                     CHAPTER VII--GENERAL AUTHORITY

            Subchapter A--General Administrative Provisions

                        regulations and hearings

    Sec. 701 [371] [(a) The] (a)(1) The authority to promulgate 
regulations for the efficient enforcement of this Act, except 
as otherwise provided in this section, is hereby vested in the 
Secretary.
    (2) Not later than February 27, 1999, the Secretary, after 
evaluating the effectiveness of the Good Guidance Practices 
document published in the Federal Register at 62 Fed. Reg. 
8961, shall promulgate a regulation specifying the policies and 
procedures of the Food and Drug Administration for the 
development, issuance, and use of guidance documents.
          * * * * * * *

                              PRESUMPTION

    Sec. 709. In any action to enforce the requirements of this 
Act respecting [a device] a device, food, drug, or cosmetic. 
The connection with interstate commerce required for 
jurisdiction in such action shall be presumed to exist.

                     PART 2--FEES RELATING TO DRUGS

SEC. 735. DEFINITIONS.

    For purposes of this subchapter:
          (1) The term ``human drug application'' means an 
        application for--
          * * * * * * *
        Such term does not include a supplement to such an 
        application, does not include an application with 
        respect to whole blood or a blood component for 
        transfusion, does not include an application with 
        respect to a bovine blood product for topical 
        application licensed before September 1, 1992, an 
        allergenic extract product, or an in vitro diagnostic 
        biologic product licensed under section 351 of the 
        Public Health [Service Act, and] Service Act, does not 
        include an application with respect to a large volume 
        parenteral drug product approved before [September 1, 
        1992.] September 1, 1992, does not include an 
        application for a licensure of a biological product for 
        further manufacturing use only, and does not include an 
        application or supplement submitted by a State or 
        Federal Government entity for a drug or biological 
        product that is not distributed commercially. Such term 
        does include an application for licensure, as described 
        in subparagraph (D), of a large volume biological 
        product intended for single dose injection for 
        intravenous use or infusion.
          * * * * * * *
        Such term does not include whole blood or a blood 
        component for transfusion, does not include a bovine 
        blood product for topical application licensed before 
        September 1, 1992, an allergenic extract product, or an 
        in vitro diagnostic biologic product licensed under 
        section 351 of the Public Health [Service Act, and] 
        Service Act, does not include a large volume parenteral 
        drug product approved before [September 1, 1992.] 
        September 1, 1992, does not include biological product 
        that is licensed for further manufacturing use only, 
        and does not include a drug or biological product that 
        is not distributed commercially and is the subject of 
        an application or supplement submitted by a State or 
        Federal Government entity. Such term does include a 
        large volume biological product intended for single 
        dose injection for intravenous use or infusion.
          (4) The term ``final dosage form'' means, with 
        respect to a prescription drug product, a finished 
        dosage form which is approved for administration to a 
        patient [without] without substantial further 
        manufacturing.
          * * * * * * *
          (7) The term ``costs of resources allocated for the 
        process for the review of human drug applications'' 
        means the expenses incurred in connection with the 
        process for the review of human drug applications for--
                  (A) officers and employees of the Food and 
                Drug Administration, [employees under contract 
                with the Food and Drug Administration who work 
                in facilities owned or leased for the Food and 
                Drug Administration,] Contractors of the Food 
                and Drug Administration advisory committees, 
                and costs related to such officers, employees, 
                [and committees,] and committees and to 
                contracts with such contractors,
          * * * * * * *
          (8) The term ``adjustment factor'' applicable to a 
        fiscal year is the lower of--
                  (A) the Consumer Price Index for all urban 
                consumers (all items; United States city 
                average) for [August of] April of the preceding 
                fiscal year divided by such Index for [August 
                1992] April 1997, or
                  [(B) the total of discretionary budget 
                authority provided for programs in the domestic 
                category for the immediately preceding fiscal 
                year (as reported in the Office of Management 
                and Budget sequestration preview report, if 
                available, required under section 254(d) of the 
                Balanced Budget and Emergency Deficit Control 
                Act of 1985) divided by such budget authority 
                for fiscal year 1992 (as reported in the Office 
                of Management and Budget final sequentration 
                report submitted after the end of the 102d 
                Congress, 2d Session).]
                  (B) 1 plus the total percentage increase for 
                such fiscal year since fiscal year 1997 in 
                basic pay under the General Schedule in 
                accordance with section 5332 of title 5, United 
                States Code, as adjusted by any locality-based 
                comparability payment pursuant to section 5304 
                of such title for Federal employees stationed 
                in the District of Columbia.
        [The terms ``budget authority'' and ``category'' in 
        subparagraph (B) are as defined the Balanced Budget and 
        Emergency Deficit Control Act of 1985, as in effect as 
        of September 1, 1992.]
          (9) The term affiliate means a business entity that 
        has a relationship with a second business entity if, 
        directly or indirectly--
                  (A) 1 business entity controls, or has the 
                power to control, the other business entity; or
                  (B) a third party controls, or has power to 
                control both of the business entities.
          * * * * * * *

SEC. 736. AUTHORITY TO ASSESS AND USE DRUG FEES.

    (a) Type of Fees.--[Beginning in fiscal year 1993] 
Beginning in fiscal year 1988, the Secretary shall assess and 
collect fees in accordance with this section as follows:
          * * * * * * *
                  (B) Payment schedule.--
                          [(i) First payment.--50 percent of 
                        the fee required by subparagraph (A) 
                        shall be due upon submission of the 
                        application or supplement.
                          [(ii) Final payment.--The remaining 
                        50 percent of the fee required by 
                        subparagraph (A) will be due upon--
                                  [(I) the expiration of 30 
                                days from the date the 
                                Secretary sends to the 
                                applicant a letter designated 
                                by the Secretary as an action 
                                letter described in section 
                                735(6)(B), or
                                [  (II) the withdrawal of the 
                                application or supplement after 
                                it is filed unless the 
                                Secretary waives the fee or a 
                                portion of the fee because no 
                                substantial work was performed 
                                on such application or 
                                supplement after it was filed.
                        The designation under subclause (I) or 
                        the waiver under subclause (II) shall 
                        be solely in the discretion of the 
                        Secretary and shall not be reviewable.]
                  (B) Payment.--The fee required by 
                subparagraph (A) shall be due upon submission 
                of the application or supplement.
          * * * * * * *
                  (D) Refund of fee if application [not 
                accepted] refused for filing.--The Secretary 
                shall refund [50 percent] 75 percent of the fee 
                paid under [subparagraph (B)(i)] subparagraph 
                (B) for any application or supplement which is 
                [not accepted] refused for filing.
                  (E) Exception for designated orphan drug or 
                indication.--A person that submits a human drug 
                application for a prescription drug product 
                that has been designated as a drug for a rare 
                disease or condition pursuant to section 526, 
                or a supplement proposing to include a new 
                indication for a rare disease or condition 
                pursuant to section 526, shall not be assessed 
                a fee under subparagraph (A), unless the human 
                drug application includes indications for other 
                than rare diseases or conditions.
                  (F) Exception for applications and 
                supplements for pediatric indications.--A 
                person that submits a human drug application or 
                supplement that includes an indication for use 
                in pediatric populations shall be assessed a 
                fee under subparagraph (A) only if--
                          (i) the application is for initial 
                        approval for use in a pediatric 
                        population; or
                          (ii) the application or supplement is 
                        for approval for use in pediatric and 
                        nonpediatric populations.
                  (G) Refund of fee if application withdrawn.--
                If an application or supplement is withdrawn 
                after the application or supplement is filed, 
                the Secretary may waive and refund the fee or a 
                portion of the fee if no substantial work was 
                performed on the application or supplement 
                after the application or supplement was filed. 
                The Secretary shall have the sole discretion to 
                waive and refund a fee or a portion of the fee 
                under this subparagraph. A determination by the 
                Secretary concerning a waiver or refund under 
                this paragraph shall not be reviewable.
          (2) Prescription drug establishment fee.--Each person 
        that--
                  (A) owns a prescription drug establishment, 
                at which is manufactured at least 1 
                prescription drug product which is not the, or 
                not the same as a, product approved under an 
                application filed under section 505(b)(2) or 
                [505(j), and] 505(j) or under an abbreviated 
                new drug application pursuant to regulations in 
                effect prior to the implementation of the Drug 
                Price Competition and Patent Term Restoration 
                Act of 1984, or a product approved under an 
                application filed under section 507 that is 
                abbreviated, and
          * * * * * * *
          (3) Prescription drug product fee.--
                  (A) In general.--Except as provided in 
                subparagraph (B), each person--
                          (i) who is named as the applicant in 
                        a human drug application for a 
                        prescription drug product which [is 
                        listed] has been submitted for listing 
                        under section 510, and
                          (ii) who, after September 1, 1992, 
                        had pending before the Secretary a 
                        human drug application or supplement,
                shall pay for each such prescription drug 
                product the annual fee established in 
                subsection (b). [Such fee shall be payable at 
                the time of the first such listing of such 
                product in each calendar year. Such fee shall 
                be paid only once each year for each listed 
                prescription drug product irrespective of the 
                number of times such product is listed under 
                section 510.] Such fee shall be payable for the 
                fiscal year in which the product is first 
                submitted for listing under section 510, or for 
                relisting under section 510 if the product has 
                been withdrawn from listing and relisted. After 
                such fee is paid for that fiscal year, such fee 
                shall be payable on or before January 31 of 
                each year. Such fee shall be paid only once for 
                each product for a fiscal year in which the fee 
                is payable.
                  (B) Exception.--The listing of a prescription 
                drug product under section 510 shall not 
                require the person who listed such product to 
                pay the fee prescribed by subparagraph (A) if 
                such product is the same product as a product 
                approved under an application filed under 
                section 505(b)(2) or [505(j).] 505(j), or under 
                an abbreviated new drug application pursuant to 
                regulations in effect prior to the 
                implementation of the Drug Price Competition 
                and Patent Term Restoration Act of 1984, or is 
                a product approved under an application filed 
                under section 507 that is abbreviated.
    [(b) Fee Amounts.--]
    (b) Fee Amounts.--Except as provided in subsections (c), 
(d), (f), and (g), the fees required under subsection (a) shall 
be determined and assessed as follows:
          (1) Application and supplement fees.--
                  (A) Full fees.--The application fee under 
                subsection (a)(1)(A)(i) shall be $250,704 in 
                fiscal year 1998, $256,338 in each of fiscal 
                years 1999 and 2000, $267,606 in fiscal year 
                2001, and $258,451 in fiscal year 2002.
                  (B) Other fees.--The fee under subsection 
                (a)(1)(A)(ii) shall be $125,352 in fiscal year 
                1998, $128,169 in each of fiscal years 1999 and 
                2000, $133,803 in fiscal year 2001 and $129,226 
                in fiscal year 2002.
          (2) Fee revenues for establishment fees.--The total 
        fee revenues to be collected in establishment fees 
        under subsection (a)(2) shall be $35,600,000 in fiscal 
        year 1998, $36,400,000 in each of fiscal years 1999 and 
        2000, $38,000,000 in fiscal year 2001, and $36,700,000 
        in fiscal year 2002.
          (3) Total fee revenues for product fees.--The total 
        fee revenues to be collected in product fees under 
        subsection (a)(3) in a fiscal year shall be equal to 
        the total fee revenues collected in establishment fees 
        under subsection (a)(2) in that fiscal year.
          * * * * * * *
    (c) [Increases and] Adjustments.--
          [(1) Revenue increase.--The total fee revenues 
        established by the schedule in subsection (b)(1) shall 
        be increased by the Secretary] (1) Inflation 
        adjustment.--The fees and total fee revenues 
        established in subsection (b) shall be adjusted by the 
        Secretary by notice, published in the Federal Register, 
        for a fiscal year to reflect the greater of--
                  (A) the total percentage [increase] change 
                that occurred during the preceding fiscal year 
                in the Consumer Price Index for all urban 
                consumers (all items; U.S. city average), or
                  (B) the total percentage [increase] change 
                for such fiscal year in basic pay under the 
                General Schedule in accordance with section 
                5332 of title 5, United States Code, as 
                adjusted by any locality-based comparability 
                payment pursuant to section 5304 of such title 
                for Federal employees stationed in the District 
                of Columbia.
        The adjustment made each fiscal year by this subsection 
        will be added on a compounded basis to the sum of all 
        adjustments made each fiscal year after fiscal year 
        1997 under this subsection.
          (2) Annual fee adjustment.--Subject to the amount 
        appropriated for a fiscal year under subsection (g), 
        the Secretary shall, within 60 days after the end of 
        each fiscal year beginning after [October 1, 1992, 
        adjust the fees established by the schedule in 
        subsection (b)(1) for the following fiscal year to 
        achieve the total fee revenues, as may be increased 
        under paragraph (1). Such fees shall be adjusted under 
        this paragraph to maintain the proportions established 
        in such schedule.] September 30, 1997, adjust the 
        establishment and product fees described in subsection 
        (b) for the fiscal year in which the adjustment occurs 
        so that the revenues collected from each of the 
        categories of fees described in paragraphs (2) and (3) 
        of subsection (b) shall be set to be equal to the 
        revenues collected during the past fiscal year from the 
        category of application and supplement fees described 
        in paragraph (1) of subsection (b).
          (3) Limit.--The total amount of fees charged, as 
        adjusted under [paragraph (2)] this subsection, for a 
        fiscal year may not exceed the total costs for such 
        fiscal year for the resources allocated for the process 
        for review of human drug applications.
    (d) Fee Waiver or Reduction.--[The Secretary shall grant a 
waiver from or a reduction of 1 or more fees under subsection 
(a) where the Secretary finds that--] (1) In general._The 
Secretary shall grant a waiver from or a reduction of 1 or more 
fees assessed under subsection (a) where the Secretary finds 
that--
          [(1)] (A) such waiver or reduction is necessary to 
        protect the public health,
          [(2)] (B) the assessment of the fee would present a 
        significant barrier to innovation because of limited 
        resources available to such person or other 
        circumstances,
          [(3)] (C) the fees to be paid by such person will 
        exceed the anticipated present and future costs 
        incurred by the Secretary in conducting the process for 
        the review of human drug applications for such person[, 
        or],
          [(4)] (D) assessment of the fee for an application or 
        a supplement filed under section 505(b)(1) pertaining 
        to a drug containing an active ingredient would be 
        inequitable because an application for a product 
        containing the same active ingredient filed by another 
        person under section 505(b)(2) could not be assessed 
        fees under subsection (a)(1)[.], or;
          (E) the applicant is a small business submitting its 
        first human drug applicaiton to the Secretary for 
        review.
[In making the finding in paragraph (3), the Secretary may use 
standard costs.]
    (2) Use of standard costs.--In making the finding in 
paragraph (1)(C), the Secretary may use standard costs.
    (3) Rules relating to small businesses.--
          (A) Definition.--In paragraph (1)(E), the term 
        ``small business'' means an entity that has fewer than 
        500 employees, including employees of affiliates.
          (B) Waiver of application fee.--The Secretary shall 
        waive under paragraph (1)(E) the application fee for 
        the first human drug application that a small business 
        or its affiliate submits to the Secretary for review. 
        After a small business or its affiliate is granted such 
        a waiver, the small business or its affiliate shall 
        pay--
                  (i) application fees for all subsequent human 
                drug applications submitted to the Secretary 
                for review in the same manner as an entity that 
                does not qualify as a small business; and
                  (ii) all supplement fees for all supplements 
                to human drug applications submitted to the 
                Secretary for review in the same manner as an 
                entity that does not qualify as a small 
                business.
          * * * * * * *
    (f) Assessment of Fees.--
          (1) Limitation.--Fees may not be assessed under 
        subsection (a) for a fiscal year beginning after 
        [fiscal year 1993] fiscal year 1997 unless 
        appropriations for salaries and expenses of the Food 
        and Drug Administration for such fiscal year (excluding 
        the amount of fees appropriated for such fiscal year) 
        are equal to or greater than the amount of 
        appropriations for the salaries and expenses of the 
        Food and Drug Administration for the [fiscal year 1992] 
        fiscal year 1997 (excluding the amount of fees 
        appropriated for such fiscal year) multiplied by the 
        adjustment factor applicable to the fiscal year 
        involved.
          * * * * * * *
    (g) Crediting and Availability of Fees.--
          (1) In general.--Fees collected for a fiscal year 
        pursuant to subsection (a) shall be credited to the 
        appropriation account for salaries and expenses of the 
        Food and Drug Administration and shall be available in 
        accordance with appropriation Acts until expended 
        without fiscal year limitation. Such sums as may be 
        necessary may be transferred from the Food and Drug 
        Administration salaries and expenses appropriation 
        account without fiscal year limitation to such 
        appropriation account for salaries and expenses with 
        such fiscal year limitation. The sums transferred shall 
        be available solely for the process for the review of 
        human drug applications within the meaning of section 
        735(6).
          (2) Collections and appropriation acts.--The fees 
        authorized by this section--
                  (A) shall be collected in each fiscal year in 
                an amount equal to the amount specified in 
                appropriation [Acts] Acts, or otherwise made 
                available for obligation for such fiscal year, 
                and
                  (B) shall only be collected and available to 
                defray increases in the costs of the resources 
                allocated for the process for the review of 
                human drug applications (including increases in 
                such costs for an additional number of full-
                time equivalent positions in the Department of 
                Health and Human Services to be engaged in such 
                process) [over such costs for fiscal year 1992] 
                over such costs, excluding costs paid from fees 
                collected under this section, for fiscal year 
                1997 multiplied by the adjustment factor.
          [(3) Authorization of appropriations.--There are 
        authorized to be appropriated for fees under this 
        section--
                  [(A) $36,000,000 for fiscal year 1993,
                  [(B) $54,000,000 for fiscal year 1994,
                  [(C) $75,000,000 for fiscal year 1995,
                  [(D) $78,000,000 for fiscal year 1996, and
                  [(E) $84,000,000 for fiscal year 1997, as 
                adjusted to reflect increases in the total fee 
                revenues made under subsection (c)(1).]
          (3) Authorization of appropriations.--There is 
        authorized to be appropriated for fees under this 
        section--
                  (A) $106,800,000 for fiscal year 1998;
                  (B) $109,200,000 for fiscal year 1999;
                  (C) $109,200,000 for fiscal year 2000;
                  (D) $114,000,000 for fiscal year 2001; and
                  (E) $110,100,000 for fiscal year 2002,
        as adjusted to reflect adjustments in the total fee 
        revenues made under this section and changes in the 
        total amounts collected by application, supplement, 
        establishment, and product fees.
          (4) Offset.--Any amount of fees collected for a 
        fiscal year which exceeds the amount of fees specified 
        in appropriation Acts for such fiscal year, shall be 
        credited to the appropriation account of the Food and 
        Drug Administration as provided in paragraph (1), and 
        shall be subtracted from the amount of fees that would 
        otherwise be authorized to be collected under 
        appropriation Acts for a subsequent fiscal year.
          * * * * * * *
    (i) Written Requests for Waivers, Reductions, and 
Refunds.--To qualify for consideration for a waiver or 
reduction under subsection (d), or for a refund, of any fee 
collected in accordance with subsection (a), a person shall 
submit to the Secretary a written request for such waiver, 
reduction, or refund not later than 180 days after such fee is 
due.
    [(i)] (j) Construction.--This section may not be construed 
to require that the number of full-time equivalent position in 
the Department of Health and Human Services, for officers, 
employers, and advisory committees not engaged in the process 
of the review of human drug applications, be reduced to offset 
the number of officers, employees, and advisory committees so 
engaged.
          * * * * * * *

   Subchapter D--Classification of Product and Environmental Impact 
                                Reviews

SEC. 741. CLASSIFICATION OF PRODUCTS.

    (a) Request.--A person who submits an application or 
submission (including a petition, notification, and any other 
similar form of request) under this Act, may submit a request 
to the Secretary respecting the classification of an article 
(including an article that is a combination product subject to 
section 503(g)) as a drug, biological product, or device, or 
respecting the component of the Food and Drug Administration 
that will regulate the article. In submitting the request, the 
person shall recommend a classification for the article, or a 
component to regulate the article, as appropriate.
    (b) Statement.--Not later than 60 days after the receipt of 
the request described in subsection (a), the Secretary shall 
determine the classification of the article or the component of 
the Food and Drug Administration that will regulate the article 
and shall provide to the person a written statement that 
identifies the classification of the article or the component 
of the Food and Drug Administration that will regulate the 
article and the reasons for such determination. The Secretary 
may not modify such statement except with the written consent 
of the person or for public health reasons.
    (c) Inaction of Secretary.--If the Secretary does not 
provide the statement within the 60-day period described in 
subsection (b), the recommendation made by the person under 
subsection (a) shall be considered to be a final determination 
by the Secretary of the classification of the article or the 
component of the Food and Drug Administration that will 
regulate the article and may not be modified by the Secretary 
except with the written consent of the person or for public 
health reasons.
          * * * * * * *

SEC. 742. ENVIRONMENTAL IMPACT REVIEW.

    Nothwithstanding any other provision of law, no action by 
the Secretary pursuant to this Act shall be subject to an 
environmental assessment, an environmental impact statement, or 
other environmental consideration unless the Secretary 
demonstrates, in writing--
          (1) that there is a reasonable probability that the 
        environmental impact of the action is sufficiently 
        substantial and within the factors that the Secretary 
        is authorized to consider under this Act; and
          (2) that consideration of the environmental impact 
        will directly affect the decision on the action.
          * * * * * * *

                  Subchapter E--Manufacturing Changes

SEC. 751. MANUFACTURING CHANGES.

    (a) In General.--A change in the manufacture of a new drug, 
including a biological product, may be made in accordance with 
this section.
    (b) Changes.--
          (1) Validation.--Before distributing a drug made 
        after a change in the manufacture of the drug from the 
        manufacturing process established in the approved new 
        drug application under section 505, or license 
        application under section 351 of the Public Health 
        Service Act, the applicant shall validate the effect of 
        the change on the identity, strength, quality, purity, 
        and potency of the drug as the identity, strength, 
        quality, purity, and potency may relate to the safety 
        or effectiveness of the drug.
          (2) Reports.--The applicant shall report the change 
        described in paragraph (1) to the Secretary and may 
        distribute a drug made after the change as follows:
                  (A) Major manufacturing changes.
                          (i) In general.--Major manufacturing 
                        changes, which are of a type determined 
                        by the Secretary to have substantial 
                        potential to adversely affect the 
                        identity, strength, quality, purity, or 
                        potency of the drug as the identity, 
                        strength, quality, purity, and potency 
                        may relate to the safety or 
                        effectiveness of a drug, shall be 
                        submitted to the Secretary in a 
                        supplemental application and drugs made 
                        after such changes may not be 
                        distributed until the Secretary 
                        approves the supplemental application.
                          (ii) Definition.--In this 
                        subparagraph, the term ``major 
                        manufacturing changes'' means--
                                  (I) changes in the 
                                qualitative or quantitative 
                                formulation of a drug or the 
                                specifications in the approved 
                                marketing application for the 
                                drug (unless exempted by the 
                                Secretary from the requirements 
                                of this subparagraph);
                                  (II) changes that the 
                                Secretary determines by 
                                regulation or issuance of 
                                guidance require completion of 
                                an appropriate human study 
                                demonstrating equivalence of 
                                the drug to the drug 
                                manufactured before such 
                                changes; and
                                  (III) other changes that the 
                                Secretary determines by 
                                regulation or issuance of 
                                guidance have a substantial 
                                potential to adversely affect 
                                the safety or effectiveness of 
                                the drug.
                  (B) Other manufacturing changes.--
                          (i) In general.--As determined by the 
                        Secretary, manufacturing changes other 
                        than major manufacturing changes 
                        shall--
                                  (I) be made at any time and 
                                reported annually to the 
                                Secretary, with supporting 
                                data; or
                                  (II) be reported to the 
                                Secretary in a supplemental 
                                application.
                          (ii) Distriction of the drug.--In the 
                        case of changes reported in accordance 
                        with clause (i)(II)--
                                  (I) the applicant may 
                                distribute the drug 30 days 
                                after the Secretary receives 
                                the supplemental application 
                                unless the Secretary notifies 
                                the applicant within such 30-
                                day period that prior approval 
                                of such supplemental 
                                application is required; and
                                  (II) the Secretary shall, 
                                after making the notification 
                                to the applicant under 
                                subclause (I), approve or 
                                disapprove each such 
                                supplemental application.
                          (iii) Special rule.--The Secretary 
                        may determine types of manufacturing 
                        changes after which distribution of a 
                        drug may commence at the time of 
                        submission of supplemental application.
           * * * * * * *

 Subchapter F--National Uniformity for Nonprescription Drugs for Human 
                           Use and Cosmetics

SEC. 761. NATIONAL UNIFORMITY FOR NONPRESCRIPTION DRUGS AND COSMETICS.

    (a) In General.--Except as provided in subsection (b), 
(c)(1), or (d), no State or political subdivision of a State 
may establish or continue in effect any requirement--
          (1) that relates to the regulation of a drug intended 
        for human use that is not subject to the requirements 
        of section 503(b)(1) or a cosmetic; and
          (2) that is different from or in addition to, or that 
        is otherwise not identical with, a requirement of this 
        Act, the Poison Prevention Packaging Act of 1970 (15 
        U.S.C. 1471 et seq.), or the Fair Packaging and 
        Labeling Act (15 U.S.C. 1451 et seq.).
    (b) Exemption.--Upon application of a State, the Secretary 
may by regulation, after notice and opportunity for written and 
oral presentation of views, exempt from subsection (a), under 
such condition as may be prescribed in such regulation a State 
requirement that---
          (1) protects an important public interest that would 
        otherwise be unprotected.
          (2) would not cause any drug or cosmetic to be in 
        violation of any applicable requirement or prohibition 
        under Federal law; and
          (3) would not unduly burden interstate commerce.
    (c) Scope.--For purposes of subsection (a), a requirement 
that relates to the regulation of a drug or cometic--
          (1) shall not include any requirement that relates to 
        the practice of pharmacy or any requirement that a drug 
        be dispensed only upon the prescription of a 
        practitioner licensed by law to administer such drug; 
        and
          (2) shall be deemed to include any requirement 
        relating to public information or any other form of 
        public communication relating to the safety or 
        effectiveness of a drug or cosmetic.
    (d) No Effect on Product Liability Law.--Nothing in this 
section shall be construed to modify or otherwise affect any 
action or the liability of any person under the product 
liability law of any State.
          * * * * * * *

SEC. 903. [393] FOOD AND DRUG ADMINISTRATION.

    (a) In General.--* * *
          * * * * * * *
    (b) Mission.--
          (1) In general.--The Administration shall protect the 
        public health by ensuring that--
                  (A) foods are safe, wholesome, sanitary, and 
                properly labeled;
                  (B) human and veterinary drugs are safe and 
                effective;
                  (C) there is reasonable assurance of safety 
                and effectiveness of devices intended for human 
                use;
                  (D) cosmetics are safe; and
                  (E) public health and safety are protected 
                from electronic product radiation.
          (2) Special rules.--The Administration shall promptly 
        and efficiently review clinical research and take 
        appropriate action on the marketing of regulated 
        products in a manner that does not unduly impede 
        innovation or product availability. The Administration 
        shall participate with other countries to reduce the 
        burden of regulation, to harmonize regulatory 
        requirements, and to achieve appropriate reciprocal 
        arrangements with other countries.
          (3) Interagency Collaboration.--The Secretary shall 
        implement programs and policies that will foster 
        collaboration between the Administration, the National 
        Institutes of Health, and other science-based Federal 
        agencies, to enhance the scientific and technical 
        expertise available to the Secretary in the conduct of 
        the duties of the Secretary with respect to the 
        development, clinical investigation, evaluation, and 
        postmarket monitoring of emerging medical therapies, 
        including complementary therapies, and advances in 
        nutrition and food science.
          (4) Agency plan for statutory compliance.--
                  (A) In general.--Not later than 180 days 
                after the date of enactment of this paragraph, 
                the Secretary, after consultation with relevant 
                experts, health care professionals, 
                representatives of patient and consumer 
                advocacy groups, and the regulated industry, 
                shall develop and publish in the Federal 
                Register a plan bringing the Secretary into 
                compliance with each of the obligations of the 
                Secretary under this Act and other relevant 
                statutes. The Secretary shall biannually review 
                the plan and shall revise the plan as 
                necessary, in consultation with such persons.
                  (B) Objectives of agency plan.--The plan 
                required by subparagraph (A) shall 
establishobjectives, and mechanisms to be used by the Secretary, acting 
through the Commissioner, including objectives and mechanisms that--
                          (i) minimize deaths of, and harm to, 
                        persons who use or may use an article 
                        regulated under this Act;
                          (ii) maximize the clarity of, and the 
                        availability of information about, the 
                        process for review of applications and 
                        submissions (including petitions, 
                        notifications, and any other similar 
                        forms of request) made under this Act, 
                        including information for potential 
                        consumers and patients concerning new 
                        products;
                          (iii) implement all inspection and 
                        postmarket monitoring provisions of 
                        this Act by July 1, 1999;
                          (iv) ensure access to the scientific 
                        and technical expertise necessary to 
                        ensure compliance by the Secretary with 
                        the statutory obligations described in 
                        subparagraph (A);
                          (v) establish a schedule to bring the 
                        Administration into full compliance by 
                        July 1, 1999, with the time periods 
                        specified in this Act for the review of 
                        all applications and submissions 
                        described in clause (ii) and submitted 
                        after the date of enactment of this 
                        paragraph; and
                          (vi) reduce backlogs in the review of 
                        all applications and submissions 
                        described in clause (ii) for any 
                        article with the objective of 
                        eliminating all backlogs in the review 
                        of the applications and submissions by 
                        January 1, 2000.
          (5) Annual report.--
                  (A) Contents.--The Secretary shall prepare 
                and publish in the Federal Register and solicit 
                public comment on an annual report that--
                          (i) provides detailed statistical 
                        information on the performance of the 
                        Secretary under the plan described in 
                        paragraph (4);
                          (ii) compares such performance of the 
                        Secretary with the objectives of the 
                        plan and with the statutory obligations 
                        of the Secretary;
                          (iii) analyzes any failure of the 
                        Secretary to achieve any objective of 
                        the plan or to meet any statutory 
                        obligation;
                          (iv) identifies any regulatory policy 
                        that has a significant impact on 
                        compliance with any objective of the 
                        plan or any statutory obligation; and
                          (v) sets forth any proposed revision 
                        to any such regulatory policy, or 
                        objective of the plan that has not been 
                        met.
                  (B) Statistical information.--The statistical 
                information described in subparagraph (A)(i) 
                shall include a full statistical presentation 
                relating to all applications and submissions 
                (including petitions, notifications, and any 
                other similar forms of request) made under this 
                Act and approved or subject to final action by 
                the Secretary during the year covered by the 
                report. In preparing the statistical 
                presentation, the Secretary shall take into 
                account the date of--
                          (i) the submission of any 
                        investigational application;
                          (ii) the application of any clinical 
                        hold;
                          (iii) the submission of any 
                        application or submission (including a 
                        petition, notification, and any other 
                        similar form of request) made under 
                        this Act for approval or clearance;
                          (iv) the acceptance for filing of any 
                        application or submission described in 
                        clause (iii) for approval or clearance;
                          (v) the occurrence of any 
                        anapprovable action;
                          (vi) the occurrence of any approvable 
                        action; and
                          (vii) the approval or clearance of 
                        any application or submission described 
                        in clause (iii).
          * * * * * * *
    [(b)] (c) Commissioner.--
          (1) Appointment.--* * *
          * * * * * * *
    [(c)] (d) Technical and Scientific Review Groups.--The 
Secretary through the Commissioner of Food and Drugs may, 
without regard to the provisions of title 5, United States 
Code, governing appointments in the competitive service and 
without regard to the provisions of chapter 51 and subchapter 
III of chapter 53 of such title relating to classification and 
General Schedule pay rates, establish such technical and 
scientific review groups as are needed to carry out the 
functions of the Administration, including functions under the 
Federal Food, Drug, and Cosmetic Act, and appoint and pay the 
members of such groups, except that officers and employees of 
the United States shall not receive additional compensation for 
service as members of such groups.
          * * * * * * *

SEC. 906. CONTRACTS FOR EXPERT REVIEW.

    (a) In General.--
          (1) Authority.--The Secretary may enter into a 
        contract with any organization or any individual (who 
        is not an employee of the Department) with expertise in 
        a relevant discipline, to review, evaluate, and make 
        recommendations to the Secretary on part or all of any 
        application or submission (including a petition, 
        notification, and any other similar form of request) 
        made under this Act for the approval or classification 
        of an article or made under section 351(a) of the 
        Public Health Service Act (42 U.S.C. 262(a)) with 
        respect to a biological product. Any such contract 
        shall be subject to the requirements of section 708 
        relating to the confidentiality of information.
          (2) Increased efficiency and expertise through 
        contracts.--The Secretary shall use the authority 
        granted in paragraph (1) whenever the Secretary 
        determines that a contract described in paragraph (1) 
        will improve the timeliness or quality of the review of 
        an application or submission described in paragraph 
        (1). Such improvement may include providing the 
        Secretary increased scientific or technicalexpertise 
that is necessary to review or evaluate new therapies and technologies.
    (b) Review of Expert Review.--
          (1) In general.--Subject to paragraph (2), the 
        official of the Food and Drug Administration 
        responsible for any matter for which expert review is 
        used pursuant to subsection (a) shall review the 
        recommendations of the organization or individual who 
        conducted the expert review and shall make a final 
        decision regarding the matter within 60 days after 
        receiving the recommendations.
          (2) Limitation.--A final decision under paragraph (1) 
        shall be made within the applicable prescribed time 
        period for review of the matter as set forth in this 
        Act or in the Public Health Service Act (42 U.S.C. 201 
        et seq.).
          (3) Authority of secretary.--Notwithstanding 
        subsection (a), the Secretary shall retain full 
        authority to make determinations with respect to the 
        approval or disapproval of an article under this Act, 
        the approval or disapproval of a biologics license with 
        respect to a biological product under section 351(a) of 
        the Public Health Service Act, or the classification of 
        an article as a device under section 513(f)(1).
          * * * * * * *

SEC. 907. INTRAMURAL RESEARCH TRAINING AWARD PROGRAM.

    (a) In General.--The Secretary, acting through the 
Commissioner of Food and Drugs, may, directly or through 
grants, contracts, or cooperative agreements, conduct and 
support intramural research training in regulatory scientific 
programs by predoctoral and postdoctoral scientists and 
physicians, including the support through the use of 
fellowships.
    (b) Limitation on Participation.--A recipient of a 
fellowship under subsection (a) may not be an employee of the 
Federal Government.
    (c) Special Rule.--The Secretary, acting through the 
Commissioner of Food and Drugs, may support the provision of 
assistance for fellowships described in subsection (a) through 
a Cooperative Research and Development Agreement.
          * * * * * * *

                       PUBLIC HEALTH SERVICE ACT

          * * * * * * *

    Part F--Licensing--Biological Products and Clinical Laboratories

                     Subpart 1--Biological Products

                   REGULATION OF BIOLOGICAL PRODUCTS

    Sec. 351. [262] [(a) No person shall sell, barter, or 
exchange, or offer for sale, barter, or exchange in the 
District of Columbia, or send, carry, or bring for sale, 
barter, or exchange from any State or possession into any other 
State or possession or into any foreign country, or from any 
foreign country into any State or possession, any virus, 
therapeutic serum, toxin, antitoxin, vaccine, blood, blood 
component or derivative, allergenic product, or analogous 
product, or arsphenamine or its derivatives (or any other 
trivalent organic arsenic compound), applicable to the 
prevention, treatment, or cure of diseases or injuries of man, 
unless (1) such virus, serum, toxin, antitoxin, vaccine, blood, 
blood component or derivative, allergenic product, or other 
product has been propagated or manufactured and prepared at an 
establishment holding an unsuspended and unrevoked license, 
issued by the Secretary as hereinafter authorized, to propagate 
or manufacture, and prepare such virus, serum, toxin, 
antitoxin, vaccine, blood, blood component or derivative, 
allergenic product, or other product for sale in the District 
of Columbia, or for sending, bringing, or carrying from place 
to place afore-said: and (2) each package of such virus, serum, 
toxin, antitoxin, vaccine, blood, blood component or 
derivative, allergenic product, or other product is plainly 
marked with the proper name of the article contained therein, 
the name, address, and license number of the manufacturer, and 
the date beyond which the contents cannot be expected beyond 
reasonable doubt to yield their specific results. The 
suspension or revocation of any license shall not prevent the 
sale, barter, or exchange of any virus, serum, toxin, 
antitoxin, vaccine, blood, blood component or derivative, 
allergenic product, or other product aforesaid which has been 
sold and delivered by the licensee prior to such suspension or 
revocation, unless the owner or custodian of such virus, serum, 
toxin, antitoxin, vaccine, blood, blood component or 
derivative, allergenic product, or other product aforesaid has 
been notified by the Secretary not to sell, barter, or exchange 
the same.] (a)(1) Except as provided in paragraph (4), no 
person shall introduce or deliver for introduction into 
interstate commerce any biological product unless--
          (A) a biologics license is in effect for the 
        biological product; and
          (B) each package of the biological product is plainly 
        marked with--
                  (i) the proper name of the biological product 
                contained in the package;
                  (ii) the name, address, and applicable 
                license number of the manufacturer of the 
                biological product; and
                  (iii) the expiration date of the biological 
                product.
    (2)(A) The Secretary shall establish, by regulation, 
requirements for the approval, suspension, and revocation of 
biologics licenses.
    (B) The Secretary shall approve a biologics license 
application on the basis of a demonstration that--
          (i) the biological product that is the subject of the 
        application is safe, pure, and potent; and
          (ii) the facility in which the biological product is 
        manufactured, processed, packed, or held meets 
        standards designed to assure that the biological 
        product continues to be safe, pure, and potent.
    (3) A biologics license application shall be approved only 
if the applicant (or other appropriate person) consents to the 
inspection of the facility that is the subject of the 
application, in accordance with subsection (c).
    (4) The Secretary shall prescribe requirements under which 
a biological product undergoing investigation shall be exempt 
from the requirements of paragraph (1).
    [(b) No person shall falsely label or mark any package or 
container or any virus, serum, toxin, antitoxin, vaccine, 
blood, blood component or derivative, allergenic product, or 
other product aforesaid; nor alter any label or mark on any 
package or container of any virus, serum, toxin, antitoxin, 
vaccine, blood, blood component or derivative, allergenic 
product, or other product aforesaid so as to falsify such label 
or mark.]
    (b) No person shall falsely label or mark any package or 
container of any biological product or alter any label or mark 
on the package or container of the biological product so as to 
falsify the label or mark.
    (c) Any officer, agent, or employee of the Department of 
Health and Human Services, authorized by the Secretary for the 
purpose, may during all reasonable hours enter and inspect any 
establishment for the propagation or manufacture and 
preparation of any [virus, serum, toxin, antitoxin, vaccine, 
blood, blood component or other product aforesaid for sale 
barter, or exchange in the District of Columbia, or to be sent, 
carried, or brought from any State or possession into any other 
State or possession or into any foreign country, or from any 
foreign country into any State or possession.] biological 
product.
    [(d)(1) Licenses for the maintenance of establishments for 
the propagation or manufacture and preparation of products 
described in subsection (a) of this section may be issued only 
upon a showing that the establishment and the products for 
which a license is desired meet standards, designed to insure 
the continued safety, purity, and potency of such products, 
prescribed in regulations, and licenses for new products may be 
issued only upon a showing that they meet such standards. All 
such licenses shall be issued, suspended, and revoked as 
prescribed by regulations and all licenses issued for the 
maintenance of establishment for the propagation or manufacture 
and preparation, in any foreign country, of any such products 
for sale, barter, or exchange in any State or possession shall 
be issued upon condition that the licensees will permit the 
inspection of their establishment in accordance with subsection 
(c) of this section.]
    [(2)(A) Upon] (d)(1) Upon a determination that a batch, 
lot, or other quantity of a product licensed under this section 
presents an imminent or substantial hazard to the public 
health, the Secretary shall issue an order immediately ordering 
the recall of such batch, lot, or other quantity of such 
product. An order under this paragraph shall be issued in 
accordance with section 554 of title 5, United States Code.
    [(B)] (2) Any violation of [subparagraph (A)] paragraph (1) 
shall subject the violator to a civil penalty of up to $100,000 
per day of violation. The amount of a civil penalty under [this 
subparagraph] this paragraph shall, effective December 1 of 
each year beginning 1 year after the effective date of [this 
subparagraph] this paragraph, be increased by the percent 
change in the Consumer Price Index for the base quarter of such 
year over the Consumer Price Index for the base quarter of the 
preceding year, adjusted to the nearest \1/10\ of 1 percent. 
For purposes of [this subparagraph] this paragraph, the term 
``base quarter'', as used with respect to a year, means the 
calendar quarter ending on September 30 of such year and the 
price index for a base quarter is the arithmetical mean of such 
index for the 3 months comprising such quarter.
          * * * * * * *
    (i) In this section, the term `biological product' means a 
virus, therapeutic serum, toxin, antitoxin, vaccine, blood, 
blood component or derivative, allergenic product, analogous 
product, or arsphenamine or derivative of arsphenamine (or any 
other trivalent organic arsenic compound), applicable to the 
prevention, treatment, or cure of a disease or condition of 
human beings.
          * * * * * * *

                 TITLE IV--NATIONAL RESEARCH INSTITUTES

                 Part A--National Institutes of Health

           organization of the national institutes of health

    Sec. 401. (a) * * *
          * * * * * * *

              appointment and authority of director of nih

    Sec. 402. (a) * * *
          * * * * * * *
    (j)(1) The Secretary, acting through the Director of the 
National Institutes of Health and subject to the availability 
of appropriations, shall establish, maintain, and operate a 
program with respect to information on research relating to the 
treatment, detection, and prevention of serious or life-
threatening diseases and conditions. The program shall, with 
respect to the agencies of the Department of Health and Human 
Services, be integrated and coordinated, and, to the extent 
practicable, coordinated with other data banks containing 
similar information.
    (2)(A) After consultation with the Commissioner of Food and 
Drugs, the directors of the appropriate agencies of the 
National Institutes of Health (including the National Library 
of Medicine), and the Director of the Centers for Disease 
Control and Prevention, the Secretary shall, in carrying out 
paragraph (1), establish a data bank of informationon clinical 
trials for drugs, and biologicals, for serious or life-threatening 
diseases and conditions.
    (B) In carrying out subparagraph (A), the Secretary shall 
collect, catalog, store and disseminate the information 
described in such subparagraph. The Secretary shall disseminate 
such information through information systems, which shall 
include toll-free telephone communications, available to 
individuals with serious or life-threatening diseases and 
conditions, to other members of the public, to health care 
providers, and to researchers.
    (3) The Data Bank shall include the following:
          (A) A registry of clinical trials (whether federally 
        or privately funded) of experimental treatments for 
        serious or life-threatening diseases and conditions 
        under regulations promulgated pursuant to sections 505 
        and 520 of the Federal Food, Drug, and Cosmetic Act 
        that provides a description of the purpose of each 
        experimental drug or biological protocol, either with 
        the consent of the protocol sponsor, or when a trial to 
        test efficacy begins. Information provided shall 
        consist of eligibility criteria, a description of the 
        location of trial sites, and a point of contact for 
        those wanting to enroll in the trial, and shall be in a 
        form that can be readily understood by embers of the 
        public. Such information must be forwarded to the Data 
        Bank by the sponsor of the trial not later than 21 days 
        after the approval by the Food and Drug Administration.
          (B) Information pertaining to experimental treatments 
        for serious or life-threatening diseases and conditions 
        that may be available--
                  (i) under a treatment investigational new 
                drug application that has been submitted to the 
                Food and Drug Administration pursuant to part 
                312 of title 21, Code of Federal Regulations; 
                or
                  (ii) as a Group C cancer drug.
        The Data Bank may also include information pertaining 
        to the results of clinical trials of such treatments, 
        with the consent of the sponsor, including information 
        concerning potential toxicities or adverse effects 
        associated with the use or administration of such 
        experimental treatments.
    (4) The Data Bank shall not include information relating to 
an investigation if the sponsor has certified to the Secretary 
that disclosure of such information would substantially 
interfere with the timely enrollment of subjects in the 
investigation.
    (5) For the purpose of carrying out this subsection, there 
are authorized to be appropriated such sums as may be 
necessary. Fees collected under section 736 of the Federal 
Food, Drug, and Cosmetic (21 U.S. C. 379h) shall not be 
authorized or appropriated for use in carrying out this 
subsection.
    [(j)] (k)(1) The Director of NIH may establish a program to 
provide day care services for the employees of the National 
Institutes of Health similar to those services provided by 
other Federal agencies (including the availability of day care 
service on a 24-hour-a-day basis).
          * * * * * * *
    [(k)] (l) The Director of NIH shall carry out the program 
established in part F of title XII (relating to interagency 
research on trauma).
          * * * * * * *

                       CONTROLLED SUBSTANCES ACT

          * * * * * * *

                   TITLE II--CONTROL AND ENFORCEMENT

       Part A--Short Title; Findings and Declaration; Definitions

                              Short Title

    Sec. 100. * * *
          * * * * * * *

                              Definitions

    Sec. 102. As used in this title
    (1) * * *
          * * * * * * *
    (9) The term ``depressant or stimulant substance'' means
          (A) a drug which contains any quantity of [(i)] 
        barbituric acid or any of the salts of barbituric acid; 
        or [(ii) any derivative of barbituric acid which has 
        been designated by the Secretary as habit forming under 
        section 502(d) of the Federal Food, Drug, and Cosmetic 
        Act (21 U.S.C. 352(d)); or]
          * * * * * * *

                                
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