[House Report 108-147]
[From the U.S. Government Publishing Office]



108th Congress                                            Rept. 108-147
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================



 
                     PROJECT BIOSHIELD ACT OF 2003

                                _______
                                

                 June 10, 2003.--Ordered to be printed

                                _______
                                

 Mr. Tauzin, from the Committee on Energy and Commerce, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 2122]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 2122) to enhance research, development, 
procurement, and use of biomedical countermeasures to respond 
to public health threats affecting national security, and for 
other purposes, having considered the same, report favorably 
thereon without amendment and recommend that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     1
Background and Need for Legislation..............................     2
Hearings.........................................................     2
Committee Consideration..........................................     3
Committee Votes..................................................     3
Committee Oversight Findings.....................................     3
Statement of General Performance Goals and Objectives............     3
New Budget Authority, Entitlement Authority, and Tax Expenditures     3
Committee Cost Estimate..........................................     3
Congressional Budget Office Estimate.............................     3
Federal Mandates Statement.......................................    13
Advisory Committee Statement.....................................    13
Constitutional Authority Statement...............................    13
Applicability to Legislative Branch..............................    13
Section-by-Section Analysis of the Legislation...................    13
Committee Correspondence.........................................    20
Changes in Existing Law Made by the Bill, as Reported............    21

                          Purpose and Summary

    The purpose of the Project BioShield Act of 2003 is to 
provide the Secretary of Health and Human Services with greater 
authority and flexibility to facilitate the research and 
development of biomedical countermeasures; to authorize the 
appropriation of funding for the procurement of security 
countermeasures through the creation of a special reserve fund; 
and to authorize the emergency use of unapproved drugs, 
devices, and biologics and the emergency unapproved use of 
approved drugs, devices, and biologics.

                  Background and Need for Legislation

    During times of nation, military, or public health 
emergency, the American people may be placed at risk of 
exposure to biological, chemical, radiological, or nuclear 
agents, and the diseases caused by such agents. Unfortunately, 
there may not be approved or available countermeasures to treat 
diseases or conditions caused by such agents. Currently, 
companies have little incentive to research, develop, or 
produce vaccines or other drugs simply for a possible one-time 
purchase by the Federal government for the Strategic National 
Stockpile. Most current private sector research and development 
dollars go for drugs or devices that will have continuous 
commercial application. In addition, some of the current 
generation of drugs or devices may have special uses as 
countermeasures to biological agents like Ebola, but there is 
little incentive to perform the research or development or 
production activities that might tailor the drug or drug 
approvals for such a purpose.
    Even if a product has been developed to treat such diseases 
or conditions, if the product has not yet been approved by the 
Food and Drug Administration (FDA), access to the therapy is 
greatly limited. Nothing in the Food and Drug Act allows the 
Secretary to suspend the approval requirements to ensure access 
to unapproved drugs and devices on a large-scale basis in times 
of emergency.
    Under present law, if a product is not approved by the FDA, 
then it is unlawful to provide that product to an individual, 
unless the product has been authorized for distribution under 
an investigational new drug (IND) application (for a drug and 
biologic) or an investigational device exemption (IDE). When a 
drug or device is available under such procedures, a number of 
conditions apply that make the use of an IND or IDE infeasible 
in times of national emergency, where drugs and devices may 
need to be deployed at rapid rates. Even if a drug, biologic, 
or device is highly promising in treating a disease or 
condition associated with biological chemical radiological or 
nuclear agents, and even if it is the only therapy available, 
current FDA law does not allow for rapid deployment of the 
product.
    The Project Bioshield Act is designed to help resolve these 
problems and make our nation more secure. Like the Public 
Health Security and Bioterrorism Preparedness and Response Act, 
the project Bioshield Act is designed to help the 
administration and the nation in public health emergency 
preparedness, but relies on the ingenuity and hard work of 
Americans in the private and public sector to achieve these 
goals.

                                Hearings

    The Subcommittee on Health held a joint hearing with the 
Subcommittee on Emergency Preparedness and Response of the 
Select Committee on Homeland Security on ``Furthering Public 
Health Security: Project Bioshield'' on March 27, 2003. The 
Subcommittee received testimony from: The Honorable Tommy 
Thompson, Secretary, U.S. Department of Health and Human 
Services; Mr. Leighton Read M.D., General Partner, Alloy 
Ventures, on behalf of Biotechnology Industry Organization; Mr. 
Michael Friedman M.D., Chief Medical Officer for Biomedical 
Preparedness, PhRMA; Mr. James Baker Jr., Ruth Dow Doan 
Professor, Center for Biological Nanotechnology; and, Mr. Gary 
Noble M.D., Vice President of Medical and Public Affairs, 
Johnson & Johnson, on behalf of AdvaMed.

                        Committee Consideration

    On Thursday, May 15, 2003, the Full Committee met in open 
markup session and ordered a Committee Print reported to the 
House, as amended, by voice vote. A request by Mr. Tauzin to 
allow a report to be filed on a bill to be introduced by Mr. 
Tauzin, and that the actions of the Committee be deemed as 
actions on that bill, was agreed to by unanimous consent.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. 
There were no record votes taken in connection with ordering 
the Committee Print reported. A motion by Mr. Tauzin to order 
the Committee Print reported to the House, as amended, was 
agreed to by a voice vote.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee has held oversight 
hearings and made findings that are reflected in this report.

         Statement of General Performance Goals and Objectives

    The purpose of the Project BioShield Act of 2003 is to 
provide the Secretary of Health and Human Services with greater 
authority and flexibility to facilitate the research and 
development of biomedical countermeasures.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that H.R. 
2212, the Project Bioshield Act of 2003, would result in no new 
or increased budget authority, entitlement authority, or tax 
expenditures or revenues.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, June 6, 2003.
Hon. W. J. ``Billy'' Tauzin,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2122, the Project 
BioShield Act of 2003.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Jeanne De 
Sa and Sam Papenfuss.
            Sincerely,
                                       Douglas Holtz-Eakin,
                                                          Director.
    Enclosure.

H.R. 2122--Project BioShield Act of 2003

    Summary: H.R. 2122 would amend the Public Health Service 
Act (PHSA) to authorize appropriations of up to $5.6 billion 
for fiscal year 2004 through 2013 for procurement of certain 
security countermeasures (drugs, devices, and biological 
products to treat, identify, and prevent the public health 
consequences of terrorism). Of that amount, $890 million could 
be obligated in fiscal year 2004 and up to $3.4 billion could 
be obligated during fiscal year 2004 through 2008. Funding to 
buy these security countermeasures would be provided to the 
Department of Homeland Security (DHS), but the Department of 
Health and Human Services (HHS) would be responsible for 
procuring and stockpiling the countermeasures.
    Assuming appropriation of authorized amount and including 
administrative costs, CBO estimates that implementing H.R. 2122 
would increase discretionary spending by $0.3 billion in 2004, 
$3.1 billion for fiscal years 2004 through 2008, and $5.6 
billion over the 2004-2013 period. In addition, H.R. 2122 would 
relax certain requirements for federal agencies related to the 
development and approval of countermeasures. The bill would 
provide HHS with increased authority and flexibility to award 
contracts and grants for research and development of qualified 
countermeasures, hire technical experts, and procure items 
necessary for research. Those provisions might result in higher 
discretionary spending, but CBO does not have sufficient 
information to estimate their budgetary effect.
    The bill also would authorize the Food and Drug 
Administration (FDA) to approve the use of certain security 
countermeasures during emergencies designated by the Secretary 
of HHS. CBO estimates this provision would have no budgetary 
effect.
    H.R. 2122 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.
    Estimated Cost to the Federal Government: The estimated 
budgetary impact of H.R. 2122 is shown in the following table. 
The costs of this legislation fall within budget function 550 
(health). CBO assumes that H.R. 2112 would be enacted by 
October 1, 2003.

----------------------------------------------------------------------------------------------------------------
                                                        By fiscal year, in millions of dollars--
                                       -------------------------------------------------------------------------
                                         2004    2005    2006   2007   2008    2009    2010   2011   2012   2013
----------------------------------------------------------------------------------------------------------------
                                        CHANGES IN DISCRETIONARY SPENDING

Project BioShield:
    Estimated Authorization Level.....    890    2,528      0      0      0    2,175      0      0      0      0
    Estimated Outlays.................    270      680    870    770    510      440    560    650    490    250
Administrative Costs:
    Estimated Authorization Level.....      9        9      9      9     10       10     10     10     11     11
    Estimated Outlays.................      7        8      9      9     10       10     10     10     11     11
----------------------------------------------------------------------------------------------------------------

Basis of estimate

    CBO assumes that this bill will be enacted during fiscal 
year 2003 and will take effect in October 2003.
            Procurement of security countermeasures: Project BioShield
    Under current law, HHS administers the Strategic National 
Stockpile (SNS), which contains drugs, diagnostic devices, 
vaccines, and other biological products to combat the public 
health consequences of a terrorist attack or other public 
health emergencies. DHS currently provides the financing for 
those efforts, which include the procurement of a new smallpox 
vaccine and stockpiling of that vaccine and older versions of 
the vaccine. Authorization for those programs was established 
in the Public Health Security and Bioterrorism Preparedness 
Response Act of 2002 (Public Law 107-88). That act authorized 
appropriations of $640 million in 2002 and such sums as may be 
necessary for fiscal years 2003 through 2006 for the SNS and 
$509 million in 2002 and such sums as may be necessary for 
fiscal years 2003 and 2006 for the development of the smallpox 
vaccine. About $400 million was appropriated in 2003 for those 
activities.
    H.R. 2122 would modify the existing authorizations for the 
SNS and for the development of the smallpox vaccine by 
codifying the provision in the PHSA instead of in Public Law 
107-88. CBO estimates that this modification would have no 
budgetary effect.
    H.R. 2122 also would authorize DHS to augment the SNS with 
certain additional products. That effort, called Project 
BioShield, would allow the federal government to enter into 
contracts to procure security countermeasures, which are 
defined in the bill as drugs, devices, biological products, 
vaccines, vaccine adjuvants, antivirals, or diagnostic tests 
used to treat, identify, or prevent harm from an agent that the 
Secretary determines may cause a public health emergency 
affecting national security. Such drugs, devices, or biological 
products would have to be licensed or approved by the FDA, or 
otherwise determined by the Secretary of HHS to have the 
potential to be licensed or approval by the FDA. The federal 
government also could acquire products used to treat the 
adverse effects of drugs or biologic products used as security 
countermeasures.
    The rate at which the funding authorized by the bill would 
be appropriated and spent would depend upon many factors, 
including the nature of advances in biotechnology, the degree 
of industry interest and capacity, the threat environment, and 
government priorities. Assuming appropriation of the authorized 
amounts, current and future Administrations would have the 
discretion to enter into multiple contracts for the manufacture 
of security countermeasures or to cease contracting altogether 
for a period of years.
    To estimate spending under H.R. 2122, CBO consulted with 
Administration officials about activities they are planning or 
would consider if Project BioShield were enacted. Officials 
described plans to acquire and maintain stockpiles of seven 
security countermeasures to combat five biological agents. The 
Administration estimates that the cost of procuring, storing, 
and replacing those countermeasures would be about $5.6 billion 
over the 2004-2013 period if there were no constraints on 
funding.
    Those currently planned acquisitions do not include any 
countermeasures for chemical, radiological, or nuclear agents, 
and they address only a subset of the threats for which 
research and development activities on countermeasures is being 
conducted or funded by HHS, the Department of Defense (DoD), 
and the private sector. Based on information provided by 
government officials and in consultation with outside experts, 
CBO has concluded that it is likely that drugs, devices, or 
biological products addressing some of those other threats will 
be developed in the coming decade and that some of those 
countermeasures would be stockpiled under Project Bioshield if 
funds were appropriated for that purpose. CBO's estimate does 
not assume that any specific product would be developed and 
procured at any specific time. It does, however, account for a 
range of possibilities that would be available to the 
government if the authorized funds are appropriated.
    Authorities and Requirements Under H.R. 2122. H.R. 2122 
would authorize appropriations of up to $5.6 billion for fiscal 
years 2004 through 2013 for the federal government to enter 
into contracts to procure security countermeasures. Of that 
amount, $890 million could be obligated in fiscal year 2004 and 
up to $3.4 billion could be obligated during fiscal years 2004 
through 2008.
    Decisions regarding what types of security countermeasures 
to procure would be made by the President after reviewing 
recommendations of the Secretaries of DHS and HHS. Subject to 
Presidential approval and a determination that inclusion of 
certain countermeasures in the stockpile is appropriate, the 
Secretaries of DHS and HHS would seek potential vendors to 
produce the countermeasures and enter into contracts to buy the 
countermeasures from those vendors. In making that 
determination, the Secretary would determine and consider 
several factors, including the quantity of the product 
necessary for the stockpile, the feasibility of obtaining 
sufficient quantities of the product within five years, and 
whether there is a significant commercial market for the 
product other than as a security countermeasure. Those factors 
would not be requirements for procurement, but considerations 
in determining the appropriateness for inclusion of the 
countermeasure in the stockpile.
    The Secretary of HHS would be responsible for arranging the 
procurement, including negotiating the quantity, price, and 
production schedule in five-year contracts or cooperative 
agreements, though eight-year contracts would be permitted for 
first awards. Payment would be conditioned on the delivery of a 
substantial portion of promised units. However, the Secretary 
could provide an advance payment of not to exceed 10 percent of 
the contract if the Secretary determines such payment is 
necessary to the project's success. The Secretary could pay 
vendors for storage, shipping, and handling and would be 
permitted to use noncompetitive procedures if the product is 
available only from a limited number of sources. Additional 
countermeasures for the same threat also could be procured, if 
they were to provide improved safety or effectiveness or 
otherwise enhance public health preparedness.
    The authorized funds could not be used for the purchase of 
vaccines under contracts entered into prior to enactment, or 
for administrative costs. Based on information from 
Administration officials, CBO expects that funding would not be 
available specifically for research and development, although 
the price for the completed products would probably cover some 
development costs.
    The Administration's Plans to Implement Project BioShield. 
Based on existing science and a current assessment of potential 
threats to public health, the Administration has identified 
several agents for which countermeasures are needed to protect 
the public health and could be included in Project BioShield. 
Those agents are smallpox, anthrax, botulinum toxin, plague, 
and Ebola. The Administration estimates that spending for 
countermeasures under Project BioShield, including purchase, 
storage, and replacement costs, would total about $5.6 billion 
over the 2004-2013 period, assuming the successful development 
of those countermeasures and no constraints on funding. More 
than half of those costs would be for the improved smallpox and 
anthrax vaccines. A brief description follows of the security 
countermeasures the Administration plans to acquire and 
stockpile.
    Smallpox. Under Project BioShield, the Administration plans 
to procure a next-generation version of the smallpox vaccine 
called modified vaccinia Ankara (MVA). This new vaccine is an 
attenuated version of the existing vaccine and may be used to 
safely vaccinate about 30 million individuals with compromised 
immune systems, eczema, or certain other high-risk conditions. 
Under the authority provided for Project BioShield, HHS plans 
to purchase 60 million doses of the new vaccine at about $15 
per dose over a three-year period for a cost of about $900 
million. The Administration expects to be able to enter into 
contracts and begin acquiring the vaccine in 2004. Additional 
costs for inventory management and replacement of expired 
stocks over the 2007-2013 period would likely add another $1 
billion, according to Administration estimates, but could be 
lower if long-term refrigerated storage proves to be effective.
    Anthrax. The Administration also expects to purchase about 
60 million doses of a next-generation anthrax vaccine, called a 
recombinant protective antigent (rPA) vaccine, under Project 
BioShield. The rPA vaccine would require fewer doses per person 
than the current vaccine, and potentially could be effective 
for people who have already been exposed to anthrax, giving the 
government the ability to vaccinate about 20 million people. 
The Administration anticipates beginning the procurement 
process in the next few years and spending about $700 million 
on the vaccine over a three-year period. Because the rPA 
anthrax vaccine has an expected shelf life of five to six 
years, additional costs would be incurred for inventory 
management and replacement. The Administration estimates that 
costs for the rPA vaccine could total $1.4 billion over the 
2004-2013 period.
    Botulinum Toxin. Under current law, HHS has stockpiled some 
antitoxins to treat botulism, a paralytic and often fatal 
illness caused by a nerve toxin produced by the botulinum 
bacteria. However, those antitoxins are no longer manufactured, 
and the manufacturing process, which requires horse serum, is 
complicated and time intensive. After identifying a 
manufacturer, the Administration plans to spend about $800 
million acquiring newly produced antitoxin at a cost of about 
$2,000 per dose as part of Project BioShield. Acquisition would 
be spread over a three-year period, beginning in the next few 
years. This antitoxin would require specialized storage and 
refrigeration.
    In addition, the Administration has indicated that it would 
like to purchase both a vaccine that would protect against 
botulism and monoclonal antibodies to neutralize the effects 
ofthe toxin. (Monoclonal antibodies are engineered proteins that can 
neutralize and destroy certain pathogens and toxins.) The 
Administration anticipates buying vaccine and monoclonal antibodies by 
2007 or 2008, at a cost of about $140 million for 750,000 doses of the 
vaccine and $750 million for monoclonal antibodies. The Administration 
estimates that spending for botulinum countermeasures, including the 
cost of storage and inventory management, would total $1.8 billion over 
the 2004-2013 period.
    Plague. Plague is an infectious disease caused by a 
bacterium. Plague has several forms--pneumonic, bubonic, and 
septicemic--and can be treated by existing antibiotics. A 
vaccine for the plague is currently in the research and 
development phase, with the expectation that a product 
potentially could reach the advanced development phase next 
year. Beginning in 2005, the Administration expects to procure 
about 2 million doses (enough to treat people in areas 
surrounding any outbreak) at an estimated cost of about $40 per 
dose--for a total cost of about $80 million. With additional 
costs related to the acquisition of the vaccine, the 
Administration estimates spending on plague countermeasures 
would total about $220 million over the 2004-2013 period.
    Ebola. There is no current treatment for Ebola, one of 
several viral hemorrhagic fevers, but the National Institutes 
of Health (NIH) is conducting research on a vaccine that the 
Administration would be interested in purchasing when it 
reaches an advanced development stage. Under current plans, the 
Administration intends to purchase enough vaccine for 3 million 
individuals to prevent the spread of an outbreak. Because this 
vaccine is still in the research and development phase, when 
the vaccine would become available and the potential cost per 
dose are unclear. The Administration assumes the vaccine will 
become available in 2005, and estimates the price to be about 
$30 per dose, for a total acquisition cost of $90 million. 
Combined with other costs related to the Ebola vaccine, 
including storage and replacement, the Administration 
anticipates spending would total about $260 million over the 
2004-2013 period for this aspect of Project BioShield.
    CBO's Estimate of the Potential Cost of Project BioShield. 
CBO has estimated both the cost of implementing the 
Administration's plan and the potential cost of acquiring other 
products not encompassed by that plan.
    CBO's Estimate of the Administration's Plan. Without any 
funding constraints, CBO expects that the Administration's 
plans for MVA smallpox vaccine, the anthrax rPA vaccine, and 
the botulism antitoxins would likely take shape as described, 
albeit more slowly than the Administration estimates. CBO 
estimates that spending for vaccines and monoclonal antibodies 
for botulism and vaccines for plague and Ebola would likely be 
lower than the Administration estimates, even without funding 
constraints. CBO's lower estimate reflects the possibility that 
development of those vaccines and monoclonal antibodies might 
not succeed as quickly as the Administration's estimate 
assumes. It also reflects the possibility that Project 
BioShield would spend less on some of the botulism 
countermeasures if all three countermeasures (vaccine, 
antitoxins, and monoclonal antibodies) became available.
    CBO estimates that about $5.2 billion would be required to 
procure products identified by the Administration over the 
2004-2013 period.
    Estimated Spending for Products Not Listed in the 
Administration's Plan. Under the bill, other countermeasures 
not in the Administration's plan could be purchased with 
appropriations provided through Project BioShield. 
Consequently, the specific security countermeasures that would 
be acquired under H.R. 2122 are likely to evolve over time as 
the result of many factors, including scientific advances, the 
interest and cooperation of biotech and other manufacturing 
companies, the emergence of new threats, and changes in this 
and future Administrations' assessments of which potential 
countermeasures should be a priority. Barriers to technological 
advance such as restricted laboratory space or shortage of 
primates for testing could slow development of countermeasures 
for certain agents. At the same time, rapid advances in 
products currently in the early-stage research and development 
could present the government with unforseen countermeasure 
options. Acquisition of countermeasures would also be affected 
by whether this and future Administrations decide to procure 
products that require more than five years to be licensed or 
have a significant commercial market.
    Acquisitions under the bill might include additional 
countermeasures for agents addressed by the Administration's 
plan. For instance, potential emerging treatments include the 
use of monoclonal antibodies. This technology has had initial 
application in the treatment of cancer, and possibly could be 
applied to anthrax, the plague, or viral hemorrhagic fevers in 
the coming years. Other potential countermeasures include new 
antiviral drugs to treat smallpox and viral hemorrhagic fever 
(both biodefense research priorities for NIH) and a narrow-
spectrum antibiotic for anthrax.
    In addition, CBO's research indicates there are numerous 
other biological agents for which countermeasures ultimately 
could be purchased under Project BioShield. HHS has established 
three classes of biological agents that pose significant risks 
to national security and the public health. Category A agents 
pose the greatest risk due to their ease of transmission, 
mortality rates, and overall risk to the public. All of the 
agents included in the Administration's plan are considered 
Category A agents, but that initial plan does not address such 
Category A agents as tularemia, a bacterial infection affecting 
the respiratory system, and viral hemorrhagic fevers other than 
Ebola. Vaccines for both of those agents arebiodefense research 
priorities of NIH. Further, the government might seek countermeasures 
for some Category B and C agents, including toxins such as ricin, 
certain bacteria such as brucellosis, and several forms of viral 
encephalitis.
    Also, under the authority provided by the bill, the 
government could procure countermeasures against chemical 
agents (nerve, blister, blood, and pulmonary agents) and 
radiological and nuclear agents. The Administration currently 
does not plan to use the bill's authority to purchase agents 
that could mitigate threats from these sources, but it could do 
so if the perceived threat from these agents changed or if 
certain treatments became scientifically feasible. 
Countermeasures that could be acquired under Project BioShield 
include existing treatments for many nerve gases (including VX, 
Sarin, and Soman gas), Prussian Blue (a treatment for certain 
types of radiation poisoning), and hydroxycobalamin (a 
treatment for cyanide poisoning that is in an advanced stage of 
development).
    Finally, under H.R. 2122, Project BioShield would be able 
to purchase devices to detect and diagnose pathogens and other 
agents. Costs for such devices are also not included in the 
Administration's estimate.
    To estimate potential spending for additional 
countermeasures not mentioned in the Administration's plan, CBO 
identified several category A, B, and C biological agents and 
chemical and radiological agents for which countermeasures 
exist or are under development. The set of selected agents and 
countermeasures is not intended as a prediction of which 
countermeasures would be acquired by Project BioShield. Rather, 
it is intended to be representative of the countermeasures that 
would be eligible for acquisition if current research and 
development activities succeed in producing qualified 
countermeasures during the coming decade.
    For each of the representative biological agents, CBO 
determined whether the countermeasure is likely to be a 
vaccine, an antitoxin or antiviral, or a monoclonal antibody, 
the dosage and method of delivery (intravenously or in pill 
form), and the amount necessary to treat the population that 
could potentially be affected. the estimate assumes that 
vaccines would cost $30 to $40 per dose, on average, with 
Project BioShield acquiring 500,000 to 2 million doses of 
qualified vaccines, depending on whether the agent is 
infectious. CBO estimates that monoclonal antibodies would cost 
$5,000 per treatment, and that Project BioShield would acquire 
enough to treat several hundred thousand people if qualified 
products became available. The estimate assumes that, if other 
types of qualified antivirals or antitoxins became available, 
Project BioShield would acquire enough to treat 500,000 people, 
at costs ranging from $2,000 to $5,000 per person for certain 
intravenously-administered forms. Other countermeasures could 
be less expensive on a per-person basis. For example, certain 
antivirals or narrow-spectrum antibiotics in pill form could 
cost about $100 per treatment, CBO estimates. Additionally, CBO 
estimates that per-person costs would average $50 for Prussian 
Blue, $100 for intravenous treatments for hydrogen cyanide, and 
$300 per treatment for countermeasures for certain radiological 
and nuclear agents. If Project BioShield acquired those types 
of countermeasures, CBO assumes that the quantity procured 
would be sufficient to respond to simultaneous events in 
several large cities.
    Under optimistic assumptions about when countermeasures for 
the representative agents would become available, the cost of 
acquiring, storing, and replacing all qualified countermeasures 
for those agents could total $10 billion to $20 billion during 
the 2004-2013 period. However, CBO assumes that research and 
development efforts for some countermeasures will proceed 
slowly or be unsuccessful, and that the Administration would 
not acquire all products that could be designated as security 
countermeasures.
    Assuming appropriation of the authorized amount, CBO 
estimates that discretionary spending to acquire and store 
BioShield products would total $0.3 billion in 2004 and $5.5 
billion over the 2004-2013 period. Acquisition costs would 
comprise 70 percent to 80 percent of that amount, while 
inventory management and replacement costs would make up the 
balance.
    CBO also estimates that implementing Project BioShield 
would add to the administrative costs of HHS and DHS, both for 
the contracting process and managing the stockpile. Funding for 
those costs would come from appropriated funds. Based on 
current spending for program support services for bioterrorism-
related activities (including the SNS) at the Centers for 
Disease Control and Prevention, CBO estimates that 
administrative costs would be about $10 million a year. Subject 
to the appropriation of necessary amounts, CBO estimates that 
discretionary spending for such costs would increase by $7 
million in 2004 and $0.1 billion over the 2004-2013 period.
            Research and development into qualified countermeasures
    H.R. 2122 would authorize the Secretary of HHS to expedite 
procurement and peer review for research related to qualified 
countermeasures. The bill also would allow the Secretary to 
secure the services of experts or consultants with relevant 
expertise. Implementation of these measures could increase the 
resources required by the agency, accelerate spending, or both. 
CBO does not have sufficient information to estimate the 
additional resources that might be required by the agency or 
the rate at which spending might accelerate under the bill. 
Such spending would come from appropriated funds.
            Authorization for medical products for use in emergencies
    The FDA's regulatory process allows for expedited approval 
of security countermeasures under current law. Pursuant to the 
Public Health Security and Bioterrorism Preparedness and 
Response Act of 2002, the FDA may allow certain drugs, devices, 
and biologics defined as priority countermeasures to move more 
quickly through the agency's regulatory process. To further 
expedite the development of security countermeasures, the FDA 
has implemented a rule that allows approval of certain drugs 
based on tests in animals.
    H.R. 2122 would allow the Secretary of HHS to authorize the 
FDA to approve the use of certain drugs or devices for use 
during designated as emergencies by the Secretary of HHS, DHS, 
or Defense. The authorization would remain in effect for no 
more than one year, unless the Secretary determines otherwise 
based on the nature of the emergency. When the Secretary 
authorizes the emergency use of a product that is an unapproved 
use of an approved product, the bill would provide some 
flexibility to manufacturers in carrying out activities under 
the emergency use authorization.
    Based on information from Administration officials, CBO 
expects that implementing this provision in H.R. 2122 would not 
increase costs to the FDA. Over the past year, the FDA has 
hired about 100 people to review drug applications and provide 
assistance to companies engaged in research and development 
into security countermeasures. Thus, the agency already has the 
infrastructure to handle the additional authority related to 
the proposed emergency-use authorization and would not require 
additional resources. Therefore, CBO estimates that this 
provision of H.R. 2122 would have no budgetary effect.
    Previous CBO estimate: S. 15, the Project BioShield Act of 
2003, as reported by the Senate Committee on Health, Education, 
Labor and Pensions on March 25, 2003, would amend the Public 
Health Service Act (PHSA) to create permanent, indefinite 
funding authority for the procurement of certain biomedical 
countermeasures. In its cost estimate dated May 7, 2003, CBO 
estimated that enacting S. 15 would increase direct spending by 
$270 million in 2004 and $8.1 billion over the 2004-2013 
period.
    Although both H.R. 2122 and S. 15 would authorize programs 
to procure countermeasures to protect the public health against 
terrorism, H.R. 2122 would not have an effect on direct 
spending; instead, the bill would authorize appropriations of 
up to $5.6 billion over the 2004-2013 period. Estimated 
spending under H.R. 2122 is less than under S. 15 because the 
House bill would authorize a set amount of appropriations, 
whereas the Senate bill would provide unlimited direct spending 
authority.
    In several areas, H.R. 2122 would allow the Secretary more 
flexibility in terms of what products could be procured and how 
contracts would be structured. H.R. 2122 would allow the 
procurement of countermeasures even if they have a significant 
commercial application, while S. 15 would restrict the 
procurement authority to those without such application. While 
S. 15 would require the Secretary to determine that a 
countermeasure is likely to be approved by the FDA within five 
years as a condition of procurement, H.R. 2122 would require 
only that the Secretary consider whether a five-year limit is 
feasible. H.R. 2122 would provide additional flexibility in 
contracting by permitting the Secretary to extend first-time 
contracts to eight years (versus five in S. 15) and would allow 
the Secretary discretion to provide a 10 percent advance to 
companies developing new products. Those provisions would 
accelerate spending relative to S. 15.
    Intergovernmental and private-sector impact: H.R. 2122 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments.
    Estimate prepared by: Federal costs: Jeanne De Sa and Sam 
Papenfuss: impact on state, local, and tribal governments: Leo 
Lex; impact on the private sector: Samuel Kina.
    Estimate approved by: Robert A. Sunshine, Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional authority for this legislation is provided in 
Article I, section 8, clause 3, which grants Congress the power 
to regulate commerce with foreign nations, among the several 
States, and with the Indian tribes.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation


Section 1. Short title

    Section 1 establishes the short title of the Act as the 
``Project BioShield Act of 2003.''

Section 2. Biomedical countermeasure research and development 
        authorities

    Section 2(a) of the Project BioShield Act of 2003 amends 
the Public Health Service Act to add a new section 319F-1. The 
section grants the Secretary of Health and Human Services (HHS) 
additional flexibility and authority in conducting research and 
development with respect to biomedical countermeasures against 
biological, chemical, nuclear and radiological agents that may 
affect national security.
    The Act defines the scope of the new authorities set forth 
in this section as applying to countermeasures against agents 
that ``may cause a public health emergency affecting national 
security.'' In making a determination about whether a potential 
public health emergency could affect national security, the 
Secretary of HHS may consider all information deemed pertinent 
and appropriate, and nothing in this Act requires that such 
Secretary of HHS consult with other executive branch officials 
prior to making such a determination. The Committee expects 
that the Secretary of HHS will consider the threat of use of 
such agents by terrorists against the U.S. population to be a 
significant factor in making scope determinations under these 
provisions. However, the Committee also recognizes and 
encourages the Secretary of HHS to consider the emerging 
threats to public health and national security that may be 
caused by the spread of antibiotic resistant organisms or 
dangerous viruses that may spread rapidly and lack effective 
countermeasures today. These threats may affect national 
security whether by terrorists or through natural conditions. 
The Secretary of HHS should consider such factors in 
determining whether to use these new authorities to promote 
research, development, and production of specific security 
countermeasures.
    Indeed, antimicrobial-resistant infectious microbes are 
viable biological agents that could be used by both domestic 
and foreign terrorists to wreak havoc and injury upon U.S. 
citizens. In addition, the emergency of drug resistance in one 
organism may have the effect of limiting that drug's ability to 
treat other biological agents, as genetic material may be 
transferred naturally or purposefully from one infectious agent 
to another. Advancing the discovery of new antimicrobial drugs 
to treat resistant organisms, through Bioshield and other 
research and development initiatives, through Bioshield and 
other research and development initiatives, may well pay 
dividends for both national security and public health.
    New subsection 319F-1(b) provides general authority. 
Proposed subparagraph 319F-1(a)(4) makes the facilities of 
entities that enter into a grant or cooperative agreement with 
the Secretary of HHS under this section available as needed to 
such Secretary of HHS to respond to public health emergencies 
affecting national security.
    New subsection 319F-1(b) provides expedited authority for 
governmental procurements used to perform, administer, or 
support pressing research and development activities under this 
section, by (1) increasing the simplified acquisition threshold 
from $100,000 to $25 million; (2) authorizing the use of 
procedures providing for less than full and open competition 
when there are only a limited number of responsible sources and 
no other type of services will satisfy the Secretary of HHS 
needs; and (3) increasing the micropurchase threshold for such 
procurements to $15,000.
    New subsection 319F-1(c) authorizes the Secretary of HHS to 
use expedited peer-review procedures in lieu of otherwise 
applicable peer-review procedures in the case of grants and 
contracts for biomedical countermeasure research and 
development activity, if such grants and contracts do not 
exceed $1,500,000 and are necessary to respond to pressing 
research needs.
    New subsection 319F-1(d) provides additional flexibility to 
the Secretary of HHS with respect to the hiring of experts and 
consultants when necessary to respond to pressing qualified 
countermeasure research and development needs. Under paragraph 
319F-1(d)(2), such experts and consultants are deemed to be 
employees of HHS for purposes of the Federal Torts Claims Act, 
which provides the exclusive remedy against such personnel for 
claims relating to the performance of covered duties.
    New subsection 319F-1(e) provides streamlined personnel 
authority for the HHS Secretary to appoint up to 30 people to 
positions in the National Institutes of Health without regard 
to ordinary classificationcriteria, when necessary to respond 
to pressing qualified countermeasure research and development needs.
    New subsection 391F-1(f) provides that actions by the 
Secretary of HHS under the section are committed to agency 
discretion.
    Section 2(b) of the Project BioShield Act of 2003 amends 
section 481A of the Public Health Service act to add the 
Director of the National Institute of Allergy and Infectious 
Diseases to that section, and thus provide to that Director 
certain authorities concerning modernization and construction 
of research facilities. Section 2(b) further authorizes such 
sums as may be necessary for such purposes.

Section 3. Biomedical countermeasures procurement

    Section 3(a) of the Project BioShield Act of 2003 adds a 
new section 319F-2 to the Public Health Service Act. Several 
provisions of new section 319F-2 simply transfer existing 
provisions of law from the Public Health Security and 
Bioterrorism Preparedness and Response Act of 2002, as amended 
by the Homeland Security Act of 2002. Proposed Subsection 319F-
2(a) contains language from existing law establishing the 
Strategic National Stockpile. New section 319F-2(b) contains 
language from existing law concerning authorizing procurement 
of smallpox vaccine for the National Strategic Stockpile.
    New section 319F-2(c) requires the Secretary of the 
Department of Homeland Security (DHS) to assess threats that 
may be posed by chemical, biological, radiological, and nuclear 
agents, and requires the HHS Secretary to assess the public 
health consequences of such agents and the availability and 
appropriateness of countermeasures for the threats identified. 
After these steps, the Secretaries jointly may determine and 
recommend to the President that funding for procurement of such 
a countermeasure for the nation's stockpile is appropriate from 
the special reserve funds established by this Act.
    Under section 319F-2(c)(4), the Secretaries of HHS and DHS 
may recommend to the President a proposal to issue a call for 
the development of a security countermeasure. Such a call, at a 
minimum, includes a commitment from the Secretaries to make a 
recommendation for funding of such a countermeasure from the 
special reserve funds, if government specifications for the 
product are achieved. The Secretaries also may secure a 
Presidential approval for funding prior to, or without, 
conducting a call.
    New section 319F-2(c)(4)(B) provides that the Secretaries 
should include in any call for proposals for countermeasure 
production information that may be necessary to encourage or 
facilitate research and development into such countermeasures. 
The Committee recognizes that an important factor companies 
will consider in determining whether to invest scarce research 
and development dollars into security countermeasures is 
whether and to what extent they may face liability relating to 
the development or production of such countermeasures. The 
Committee thus encourages the Secretaries to indicate in any 
call for proposals the potential availability of 
indemnification or liability protections under other laws.
    Under section 319F-2(c)(7), if the President approves a 
recommendation for funding from the special reserve funds, DHS 
would then enter into an agreement with HHS under which HHS may 
procure the countermeasure for the stockpile using the DHS 
special reserve fund. Contracts under this paragraph are 
subject to certain conditions. The Secretary of HHS may use 
simplified acquisition procedures or procedures providing for 
less than full and open competition under certain 
circumstances. Certain determinations of the Secretary are 
committed to agency discretion.
    The Committee recognizes that existing procurement 
authorities may allow for a single agreement that provides for 
research and development as well as production of a 
countermeasure or vaccine. Nothing in this Act shall limit the 
use of these existing authorities where a single agreement 
(including a contract, grant, cooperative agreement or other 
acquisition instrument) for research, development, and 
production of a countermeasure or vaccine is deemed appropriate 
by the contracting officer, including when a separate funding 
source is authorized and used for the research and development 
and it is different than the funding source authorized and used 
for production. The Committee recognizes that such agreements 
providing express linkage between research, development, and 
production may be necessary in order to encourage entities to 
enter the government market for countermeasures and vaccines in 
accordance with the authorities provided by Project Bioshield. 
Similarly, existing procurement authorities may allow the 
Secretaries to limit competition for a production contract 
under section 3 of this Act to those entities that successfully 
competed for research and development contracts under section 2 
of this Act or other provisions of law. However, the Committee 
emphasizes that the monies obligated from the special reserve 
fund created under section 3 of this Act may not be use to pay 
for research or development activities, but only for 
procurement of countermeasures paid upon substantial delivery 
of product--consistent with the express limitation contained in 
the Homeland Security Act of 2002 excluding from the DHS 
Secretary's responsibilities the conduct or support of human 
health-related countermeasure research and development.
    Section 319F-2(d) contains prohibitions on disclosure of 
information transferred from existing law. Section 319F-3(e) 
contains definitions transferred from existing law.
    Section 319F-2(f) contains authorization of appropriations 
for the Strategic National Stockpile and smallpox vaccine 
development transferred from existing law with one addition. 
The new paragraph makes clear that such existing authorizations 
are in addition to amounts authorized under the special reserve 
fund. Nothing in the Act would restrict or alter the 
Secretaries' existing authority to purchase items for the 
stockpile using existing discretionary appropriations for such 
purpose.
    Section 3(b) of the Project BioShield Act of 2003 adds a 
new section 510 to the Homeland Security Act of 2002. This new 
section authorizes appropriations for the special reserve fund 
referenced in the new section 319F-2(c) of the Public Health 
Service Act. The bill authorizes $890 million in FY 04 for such 
procurements, and aggregate amounts of $3.4 billion and $5.6 
billion over the next five and ten fiscal yearsrespectively. 
All amounts appropriated under this authorization would be available 
for obligation through the end of FY 2013.
    The act defines the scope of the new authorities set forth 
in this section as applying to countermeasures against agents 
that the Secretary of HHS believes ``may cause a public health 
emergency affecting national security,'' and about which the 
HHS and DHS Secretaries make certain additional findings. In 
making a determination about whether a potential public health 
emergency could affect national security, the Secretary of HHS 
may consider all information deemed pertinent and appropriate, 
and nothing in this Act requires that such Secretary of HHS 
consult with other executive branch officials prior to making 
such a determination. The Committee expects that both 
Secretaries will consider the threat of use of such agents by 
terrorists against the U.S. population to be a significant 
factor in making their respective scope determinations under 
these provisions. However, the Committee also recognizes and 
encourages the Secretaries to consider the emerging threats to 
public health and national security that may be caused by the 
spread of antibiotic resistant organisms or dangerous viruses 
that may spread rapidly and lack effective countermeasures 
today. These threats may affect national security whether by 
terrorists or through natural conditions. The Secretaries 
should consider such factors in determining whether to use 
these new authorities to promote research, development, and 
production of specific security countermeasures.

Section 4. Authorization for medical products for use in emergencies

    Section 4 adds a new section 564 to the Federal Food, Drug, 
and Cosmetic Act. New section 564(a) allows the Secretary of 
Health and Human Services to authorize for introduction into 
interstate commerce unapproved drugs, devices, and biological 
products or unapproved uses of approved drugs, approved/cleared 
devices, and biological products intended for use in an actual 
or potential emergency during the effective period of a 
declaration.
    New section 564(b) allows the Secretary of HHS to declare 
an emergency justifying an emergency use authorization based 
upon a determination by the Secretary of Homeland Security that 
there is a national emergency or the significant potential of 
one, or by a determination of the Secretary of Defense that 
there is a military emergency, or a significant potential of 
one. Such emergencies must involve a heightened risk of attack 
with biological, chemical, radiological, or nuclear agents. 
Similarly, an emergency use authorization can be based upon a 
determination of the Secretary of HHS that there is a public 
health emergency affecting national security and involving 
biological, chemical, radiological, or nuclear agents. In 
making a determination about whether a public health emergency 
under section 319 of the Public Health Service Act affects 
national security, the Secretary may consider all information 
he deems pertinent and appropriate, and nothing in this Act 
requires that the Secretary consult with other executive branch 
officials prior to making such a determination.
    Under this section, any declaration of emergency will last 
for one year, unless the Secretary of HHS terminates it at an 
earlier time. The Secretary of HHS may renew a declaration. The 
Secretary of HHS must publish all declarations, determinations, 
and renewals in the Federal Register, and the Secretary must 
provide reasonable advanced notice that declarations are to be 
terminated under this section. The Committee intends that, 
after a declaration is terminated, final disposition of 
labeling or intrastate disposition of a product may occur. 
Further, the Committee believes that the Commissioner of the 
Food and Drug Administration may exercise enforcement 
discretion not to object to interstate shipment of an 
unapproved product for return to a manufacturer. A 
determination of what is a ``reasonable'' period for advanced 
notice of termination should consider all factors, so in some 
cases notice immediately preceding termination may be 
reasonable, while in other circumstances it may not.
    Section 564(c) details the criteria for issuance of an 
emergency use authorization. Under this new section, the 
Secretary of HHS, acting through the Commissioner, may issue an 
authorization upon concluding (1) that a biological, chemical, 
radiological, or nuclear agent or agents can cause a serious or 
life-threatening disease or condition; (2) that the drug, 
device or biological product may be effective in detecting, 
diagnosing, treating, or preventing such disease or condition 
(or a serious disease or condition caused by taking a product 
already approved, licensed or cleared by FDA for treating or 
preventing such disease or condition), and the benefits of the 
product outweigh risks; (3) that there is no adequate, 
approved, and available alternative to the product; and (4) 
other criteria the Secretary may by regulation specify. The 
Commissioner should consult with the Directors of the National 
Institutes of Health and the Centers for Disease Control and 
Prevention prior to issuing an authorization, but such 
consultation is limited by considerations of feasibility and 
appropriateness given the circumstances of the emergency.
    Section 564(d) concerns the scope of an emergency use 
authorization. Under this section, the authorization shall 
state the disease or condition that the product may be used to 
detect, diagnose, prevent, or treat, as well as the 
Commissioner's conclusions about known benefits and risks of 
the product and conclusions concerning safety and potential 
effectiveness. The Committee intends that before issuing an 
authorization under this section, the Commissioner will, where 
feasible given the nature and the extent of the emergency, 
notify the holder of any relevant application under this 
chapter or under section 351 of the Public Health Service Act. 
The purpose of such notification is to allow for discussion of 
the conditions of this authorization as required by subsection 
(e), as well as discussion of whether such product should be 
delivered pursuant to section 319F-2(c) of the Public Health 
Service Act.
    Section 564(e) pertains to products that have never been 
approved, licensed, or cleared by FDA. Under this subsection, 
conditions shall, to the extent feasible given the 
circumstances of the emergency, be applied to persons who 
choose to carry out an activity for which the authorization is 
issued. Such mandatory conditions include information to 
providers about the emergency use of the product as well as 
significant knownpotential risks and benefits, as well as 
appropriate conditions designed to ensure that to the maximum extent 
feasible given the circumstances of the emergency, individuals to whom 
the product is administered are informed of the emergency use of the 
product, risks and benefits of the product, and of the option to accept 
or refuse the product. Further, the Commissioner is given the authority 
to impose other conditions on those who carry out activities for which 
the authorization is issued. Such conditions imposed by the 
Commissioner should be designed to provide maximum flexibility to 
ensure that those who wish to take the product can indeed take the 
product, if made available by the manufacturer.
    Section 564(e) also applies to unapproved uses of approved 
products and the Commissioner may, for manufacturers who choose 
to carry out one or more activities pursuant to an emergency 
use authorization, apply certain conditions. This subsection 
makes clear that manufacturers do not have to avail themselves 
of the emergency use authorization for unapproved uses of 
approved products, and it makes clear that no individual may 
alter or obscure the labeling of already approved products. It 
does authorize, however, persons other than the manufacturer to 
provide information about the product concerning the emergency 
use of the product.
    Under section 564(e), the Commissioner may establish 
conditions regarding product labeling and information 
conveyance concerning unapproved products. Further, the 
Committee intends that the Commissioner may establish 
conditions regarding product labeling and information 
conveyance on manufacturers that carry out one or more 
activities pursuant to an emergency use authorization with 
respect to the emergency use of that product that is an 
unapproved use of an approved product.
    Subsection (f) makes clear that an emergency use 
authorization is effective until the declaration is terminated 
or revoked, but allows patients to continue using such products 
in certain instances. Nothing in this subsection is intended to 
require manufacturers or others to provide such products to 
patients.
    Subsection (g) makes clear that the Commissioner shall 
periodically review the appropriations of an authorization, and 
it provides the Commissioner needed flexibility to revoke an 
authorization if the criteria justifying the authorization are 
no longer met.
    Subsection (h) ensures that the Commissioner shall promptly 
publish in the Federal Register notices of all authorizations, 
terminations, and revocations, Subsection (i) makes clear that 
all determinations under this new section are committed to 
agency discretion. Subsection (j) is a rule of construction 
nothing that this new section does not impair or otherwise 
affect certain existing authorities.
    New section 564(k) pertains to members of the Armed Forces 
and, among other things, it specifies that the President may 
waive requirements designed to ensure that such members are 
informed of the option to accept or refuse administration of an 
emergency use product, upon certain findings (which are 
identical to the findings found in section 1107 of Title 10). 
Further, the subsection requires that if certain information is 
not provided to members of the Armed Forces prior to an 
emergency use product being administered to them, then 
information concerning the administration of the product shall 
be placed in the medical record of the member.
    Subsection (l) makes clear that if a product is authorized 
for emergency use under this new section, the investigational 
sections of the Act shall not apply to the products.
    Subsection (m) ensures that no authority in new section 564 
can require a manufacturer of a drug, device, or biological 
product to perform any activity that becomes lawful pursuant to 
the new section. That is, the Commissioner in no way is goven 
the authority to, among other things, require a manufacturer to 
introduce into interstate commerce or deliver for introduction 
into interstate commerce any unapproved product or an approved 
product for an unapproved use under this section. Further, even 
if the Commissioner authorizes the emergency use of an already-
approved, licensed or cleared product, a manufacturer can 
refuse to avail themselves of such emergency use authorization 
and continue introducing into interstate commerce its approved 
or cleared product under the Federal Food, Drug and Cosmetic 
Act, or licensed product pursuant to the Public Health Service 
Act. The only obligation in subsection (m) is that if the 
Commissioner authorizes the emergency use of a sole-source 
unapproved product, then the manufacturer of such product must 
inform the Commissioner of its intention not to carry out any 
activity under the authorization within a reasonable period of 
time. Nothing in this section shall be construed as authorizing 
the Commissioner to establish conditions on the distribution, 
administration, or labeling of any other product in any other 
circumstance.
    Subsection (n) ensures that the present enforcement regime 
of the Federal Food, Drug, and Cosmetic Act will apply to 
individuals who carry out an activity or activities pursuant to 
an authorization, but fail to comply with applicable 
conditions. If any person carries out an activity pursuant to 
section 564, but violates a condition imposed by the 
Commissioner, then that person will be subject to Chapter III 
of the Act, where the ``prohibited acts'' are found. If a 
person is found to be in violation of a prohibited act found in 
section 301, then the Committee intends for that person to be 
subject to the enforcement provisions found in sections 302, 
303, and 304. A violation of any condition applied to an 
emergency use product in no way alters or affects the emergency 
use status of the underlying product.
    The Committee intends that new section 564, as made clear 
in section 903(d)(2) of the Federal Food, Drug, and Cosmetic 
Act, the Secretary, through the Commissioner of Food and Drugs, 
shall be responsible for executing the Federal Food Drug, and 
Cosmetic Act as amended by the Project BioShield Act.

Section 5. Reports

    Section 5(a) requires the Secretary of HHS to submit annual 
reports to Congress concerning the exercise of many of the new 
authorities under the Act. Section 5(b) requires a report from 
the National Academy of Sciences concerning whether and to what 
extent the research authorities granted under the Act have 
enhanced the development of biomedical countermeasures 
affecting national security. Section 5(c) requires the General 
Accounting Office to issue a report concerning the Secretary of 
HHS utilization of these new authorities.

                        Committee Correspondence

                                Committee on the Judiciary,
                                     Washington, DC, June 10, 2003.
Hon. Billy Tauzin,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
    Dear Chairman Tauzin: In recognition of the desire to 
expedite floor consideration of H.R. 2122, the ``Project 
BioShield Act of 2003,'' the Committee on the Judiciary hereby 
waives consideration of the bill. Section 2 of the bill creates 
a new section 319F-1 of the Public Health Service Act. New 
subsection 319F-1(d) gives the Secretary of Health and Human 
Services new authority to enter into personal services 
contracts with scientists and consultants for limited periods 
of time for the purposes of expedited research on 
countermeasures against biological weapons. New subsection 
319F-1(d) further provides that scientists and consultants who 
receive contracts under this provision shall have the 
protections of the Federal Tort Claims Act as if they were 
regular federal employees. These FTCA provisions fall within 
the Committee on the Judiciary's Rule X jurisdiction. However, 
given the need to expedite this legislation, I will not seek a 
sequential referral based on their inclusion.
    The Committee on the Judiciary takes this action with the 
understanding that the Committee's jurisdiction over these 
provisions is in no way diminished or altered. I would 
appreciate your including this letter in the Congressional 
Record during consideration of H.R. 2122 on the House floor.
            Sincerely,
                               F. James Sensenbrenner, Jr.,
                                                          Chairman.
                                ------                                

                          Committee on Energy and Commerce,
                                     Washington, DC, June 10, 2003.
Hon. F. James Sensenbrenner, Jr.,
Chairman, Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Chairman Sensenbrenner: Thank you for your letter 
regarding H.R. 2122, the ``Project BioShield Act of 2003.'' As 
you noted, new subsection 319F-1(d) of the Public Health 
Service Act as added by the bill contains provisions that fall 
within the Rule X jurisdiction of the Committee on the 
Judiciary.
    I appreciate your willingness not to seek a referral on 
H.R. 2122. I agree that your decision to forego action on the 
bill will not prejudice the Committee on the Judiciary with 
respect to its jurisdictional prerogatives on this or similar 
legislation.
    I will include a copy of your letter and this response in 
the Congressional Record during consideration of H.R. 2122 of 
the House floor.
            Sincerely,
                                     W.J. ``Billy'' Tauzin,
                                                          Chairman.

         Changes in Existing Law Made by the Bill, as Reported

      In compliance with clause 3(e) of rule XIII of the Rules 
of the House of Representatives, changes in existing law made 
by the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

PUBLIC HEALTH SERVICE ACT

           *       *       *       *       *       *       *


TITLE III--GENERAL POWERS AND DUTIES OF PUBLIC HEALTH SERVICE

           *       *       *       *       *       *       *


Part B--Federal-State Cooperation

           *       *       *       *       *       *       *


SEC. 319F-1. AUTHORITY FOR USE OF CERTAIN PROCEDURES REGARDING 
                    BIOMEDICAL COUNTERMEASURE RESEARCH AND DEVELOPMENT 
                    ACTIVITIES.

  (a) In General.--
          (1) Authority.--In conducting and supporting research 
        and development activities regarding biomedical 
        countermeasures under section 319F(h), the Secretary 
        may conduct and support such activities in accordance 
        with this section if the activities concern qualified 
        countermeasures.
          (2) Qualified countermeasure.--For purposes of this 
        section, the term ``qualified countermeasure'' means a 
        priority countermeasure (as defined in section 319F(h)) 
        that affects national security.
          (3) Interagency cooperation.--
                  (A) In general.--In carrying out activities 
                under this section, the Secretary is 
                authorized, subject to subparagraph (B), to 
                enter into interagency agreements and other 
                collaborative undertakings with other agencies 
                of the United States Government.
                  (B) Limitation.--An agreement or undertaking 
                under this paragraph shall not authorize 
                another agency to exercise the authorities 
                provided by this section.
          (4) Availability of facilities to the secretary.--In 
        any grant or cooperative agreement entered into under 
        the authority provided in this section with respect to 
        a biocontainment laboratory or other related or 
        ancillary specialized research facility that the 
        Secretary determines necessary for the purpose of 
        performing, administering, and supporting qualified 
        countermeasure research and development, the Secretary 
        may provide that the facility that is the object of 
        such grant or cooperative agreement shall be available 
        as needed to the Secretary to respond to public health 
        emergencies affecting national security.
  (b) Expedited Procurement Authority.--
          (1) Increased simplified acquisition threshold for 
        biomedical countermeasure procurements.--
                  (A) In general.--For any procurement by the 
                Secretary of property or services for use (as 
                determined by the Secretary) in performing, 
                administering, or supporting qualified 
                countermeasure research or development 
                activities under this section that the 
                Secretary determines necessary to respond to 
                pressing research and development needs under 
                this section, the amount specified in section 
                4(11) of the Office of Federal Procurement 
                Policy Act (41 U.S.C. 403(11)), as applicable 
                pursuant to section 302A(a) of the Federal 
                Property and Administrative Services Act of 
                1949 (41 U.S.C. 252a(a)), shall be deemed to be 
                $25,000,000 in the administration, with respect 
                to such procurement, of--
                          (i) section 303(g)(1)(A) of the 
                        Federal Property and Administrative 
                        Services Act of 1949 (41 U.S.C. 
                        253(g)(1)(A)) and its implementing 
                        regulations; and
                          (ii) section 302A(b) of such Act (41 
                        U.S.C. 252a(b)) and its implementing 
                        regulations.
                  (B) Application of certain provisions.--
                Notwithstanding subparagraph (A) and the 
                provision of law and regulations referred to in 
                such subparagraph, each of the following 
                provisions shall apply to procurements 
                described in this paragraph to the same extent 
                that such provisions would apply to such 
                procurements in the absence of subparagraph 
                (A):
                          (i) Chapter 37 of title 40, United 
                        States Code (relating to contract work 
                        hours and safety standards).
                          (ii) Subsections (a) and (b) of 
                        Section 7 of the Anti-Kickback Act of 
                        1986 (41 U.S.C. 57(a) and (b)).
                          (iii) Section 304C of the Federal 
                        Property and Administrative Services 
                        Act of 1949 (41 U.S.C. 254d) (relating 
                        to the --- examination of contractor 
                        records).
                  (C) Internal controls to be instituted.--The 
                Secretary shall institute appropriate internal 
                controls for procurements that are under this 
                paragraph, including requirements with regard 
                to documenting the justification for use of the 
                authority in this paragraph.
          (2) Use of noncompetitive procedures.--In addition to 
        any other authority to use procedures other than 
        competitive procedures, the Secretary may use such 
        other procedures when--
                  (A) the procurement is as described by 
                paragraph (1); and
                  (B) the property or services needed by the 
                Secretary are available from only one 
                responsible source or only from a limited 
                number of responsible sources, and no other 
                type of property or services will satisfy the 
                Secretary's needs.
          (3) Increased micropurchase threshold.--
                  (A) In general.--For a procurement described 
                by paragraph (1), the amount specified in 
                subsections (c), (d), and (f) of section 32 of 
                the Office of Federal Procurement Policy Act 
                (41 U.S.C. 428) shall be deemed to be $15,000in 
the administration of that section with respect to such procurement.
                  (B) Internal controls to be instituted.--The 
                Secretary shall institute appropriate internal 
                controls for purchases that are under this 
                paragraph and that are greater than $2,500.
                  (C) Exception to preference for purchase card 
                mechanism.--No provision of law establishing a 
                preference for using a Government purchase card 
                method for purchases shall apply to purchases 
                that are under this paragraph and that are 
                greater than $2,500.
  (c) Authority To Expedite Peer Review.--
          (1) In general.--The Secretary may, as the Secretary 
        determines necessary to respond to pressing qualified 
        countermeasure research and development needs under 
        this section, employ such expedited peer review 
        procedures (including consultation with appropriate 
        scientific experts) as the Secretary, in consultation 
        with the Director of NIH, deems appropriate to obtain 
        assessment of scientific and technical merit and likely 
        contribution to the field of qualified countermeasure 
        research, in place of the peer review and advisory 
        council review procedures that would be required under 
        sections 301(a)(3), 405(b)(1)(B), 405(b)(2), 
        406(a)(3)(A), 492, and 494, as applicable to a grant, 
        contract, or cooperative agreement--
                  (A) that is for performing, administering, or 
                supporting qualified countermeasure research 
                and development activities; and
                  (B) the amount of which is not greater than 
                $1,500,000.
          (2) Subsequent phases of research.--The Secretary's 
        determination of whether to employ expedited peer 
        review with respect to subsequent phases of a research 
        grant or cooperative agreement under this section shall 
        be determined without regard to the peer review 
        procedures used for any prior peer review of that same 
        grant or cooperative agreement.
  (d) Authority for Personal Services Contracts.--
          (1) In general.--For the purpose of performing, 
        administering, and supporting qualified countermeasure 
        research and development activities, the Secretary may, 
        as the Secretary determines necessary to respond to 
        pressing qualified countermeasure research and 
        development needs under this section, obtain by 
        contract (in accordance with section 3109 of title 5, 
        United States Code, but without regard to the 
        limitations in such section on the period of service 
        and on pay) the personal services of experts or 
        consultants who have scientific or other professional 
        qualifications, except that in no case shall the 
        compensation provided to any such expert or consultant 
        exceed the daily equivalent of the annual rate of 
        compensation for the President.
          (2) Federal tort claims act coverage.--
                  (A) In general.--A person carrying out a 
                contract under paragraph (1), and an officer, 
                employee, or governing board member of such 
                person, shall be deemed to be an employee of 
                the Department of Health and Human Services for 
                purposes of claims under sections 1346(b) and 
                2672 of title 28, United States Code, for money 
                damages for personal injury, including death, 
                resulting from performance of functions under 
                such contract.
                  (B) Exclusivity of remedy.--The remedy 
                provided by subparagraph (A) shall be exclusive 
                of any other civil action or proceeding by 
                reason of the same subject matter against the 
                person, officer, employee, or governing board 
                member.
          (3) Internal controls to be instituted.--
                  (A) In general.--The Secretary shall 
                institute appropriate internal controls for 
                contracts under this subsection, including 
                procedures for the Secretary to make a 
                determination of whether a person, or an 
                officer, employee, or governing board member of 
                a person, is deemed to be an employee of the 
                Department of Health and Human Services 
                pursuant to paragraph (2).
                  (B) Determination of employee status to be 
                final.--A determination by the Secretary under 
                subparagraph (A) that a person, or an officer, 
                employee, or governing board member of a 
                person, is or is not deemed to be an employee 
                of the Department of Health and Human Services 
                shall be final and binding on the Secretary and 
                the Attorney General and other parties to any 
                civil action or proceeding.
          (4) Number of personal services contracts limited.--
        The number of experts and consultants whose personal 
        services are obtained under paragraph (1) shall not 
        exceed 30 at any time.
  (e) Streamlined Personnel Authority.--
          (1) In general.--In addition to any other personnel 
        authorities, the Secretary may, as the Secretary 
        determines necessary to respond to pressing qualified 
        countermeasure research and development needs under 
        this section, without regard to such 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, appoint professional and technical 
        employees, not to exceed 30 such employees at any time, 
        to positions in the National Institutes of Health to 
        perform, administer, or support qualified 
        countermeasure research and development activities in 
        carrying out this section.
          (2) Internal controls to be instituted.--The 
        Secretary shall institute appropriate internal controls 
        for appointments under this subsection.
  (f) Actions Committed to Agency Discretion.--Actions by the 
Secretary under the authority of this section are committed to 
agency discretion.

SEC. 319F-2. STRATEGIC NATIONAL STOCKPILE.

  (a) Strategic National Stockpile.--
          (1) In general.--The Secretary of Homeland Security 
        (referred to in this section as the ``Homeland Security 
        Secretary''), in coordination with the Secretary and 
        the Secretary of Veterans Affairs, shall maintain a 
        stockpile or stockpiles of drugs, vaccines and other 
        biological products, medical devices, and other 
        supplies in such numbers, types, and amounts as are 
        determined by the Secretary to be appropriate and 
        practicable, taking into account other available 
        sources, to provide for the emergency health security 
        of the United States, including the emergency health 
        security of children and other vulnerable populations, 
        in the event of a bioterrorist attack or other public 
        health emergency.
          (2) Procedures.--The Secretary, in managing the 
        stockpile under paragraph (1), shall--
                  (A) consult with the working group under 
                section 319F(a);
                  (B) ensure that adequate procedures are 
                followed with respect to such stockpile for 
                inventory management and accounting, and for 
                the physical security of the stockpile;
                  (C) in consultation with Federal, State, and 
                local officials, take into consideration the 
                timing and location of special events;
                  (D) review and revise, as appropriate, the 
                contents of the stockpile on a regular basis to 
                ensure that emerging threats, advanced 
                technologies, and new countermeasures are 
                adequately considered;
                  (E) devise plans for the effective and timely 
                supply-chain management of the stockpile, in 
                consultation with appropriate Federal, State 
                and local agencies, and the public and private 
                health care infrastructure; and
                  (F) ensure the adequate physical security of 
                the stockpile.
  (b) Smallpox Vaccine Development.--
          (1) In general.--The Secretary shall award contracts, 
        enter into cooperative agreements, or carry out such 
        other activities as may reasonably be required in order 
        to ensure that the stockpile under subsection (a) 
        includes an amount of vaccine against smallpox as 
        determined by such Secretary to be sufficient to meet 
        the health security needs of the United States.
          (2) Rule of construction.--Nothing in this section 
        shall be construed to limit the private distribution, 
        purchase, or sale of vaccines from sources other than 
        the stockpile described in subsection (a).
  (c) Additional Authority Regarding Procurement of Certain 
Biomedical Countermeasures; Availability of Special Reserve 
Fund.--
          (1) In general.--
                  (A) Use of fund.--A security countermeasure 
                may, in accordance with this subsection, be 
                procured with amounts in the special reserve 
                fund under paragraph (10).
                  (B) Security countermeasure.--For purposes of 
                this subsection, the term ``security 
                countermeasure'' means a priority 
                countermeasure (as defined in section 
                319F(h))--
                          (i) that affects national security;
                          (ii) that is determined under 
                        paragraph (2)(B)(ii) to be a necessary 
                        countermeasure; and
                          (iii)(I) that is approved or cleared 
                        under chapter V of the Federal Food, 
                        Drug, and Cosmetic Act, or licensed 
                        under section 351 of this Act, for use 
                        as a countermeasure to a chemical, 
                        biological, radiological, or nuclear 
                        agent identified as a material threat 
                        under paragraph (2)(A)(ii); or
                          (II) for which the Secretary 
                        determines that sufficient and 
                        satisfactory clinical experience or 
                        research data (including data, if 
                        available, from pre-clinical and 
                        clinical trials) support a reasonable 
                        conclusion that the countermeasure will 
                        qualify for approval or licensing after 
                        the date of a determination under 
                        paragraph (5).
          (2) Determination of material threats.--
                  (A) material threat.--The Homeland Security 
                Secretary, in consultation with the heads of 
                other agencies as appropriate, shall on an 
                ongoing basis--
                          (i) assess current and emerging 
                        threats of chemical, biological, 
                        radiological, and nuclear agents; and
                          (ii) determine which of such agents 
                        present a material threat against the 
                        United States population.
                  (B) Public health impact; necessary 
                countermeasures.--The Secretary shall on an 
                ongoing basis--
                          (i) assess the potential public 
                        health consequences of use against the 
                        United States population of agents 
                        identified under subparagraph (A)(ii); 
                        and
                          (ii) determine, on the basis of such 
                        assessment, the agents for which 
                        priority countermeasures are necessary 
                        to protect the public health from a 
                        material threat.
          (3) Assessment of availability and appropriateness of 
        countermeasures.--The Secretary, in consultation with 
        the Homeland Security Secretary, shall assess on an 
        ongoing basis the availability and appropriateness of 
        specific countermeasures to address specific threats 
        identified under paragraph (2).
          (4) Call for security countermeasures; commitment for 
        recommendation for procurement.--
                  (A) Proposal to the president.--If, pursuant 
                to an assessment under paragraph (3), the 
                Homeland Security Secretary and the Secretary 
                make a determination that a security 
                countermeasure would be appropriate, such 
                Secretaries may jointly submit to the President 
                a proposal to--
                          (i) issue a call for the development 
                        of such security countermeasure; and
                          (ii) make a commitment that, upon the 
                        first development of such security 
                        countermeasure that meets the 
                        conditions for procurement under 
                        paragraph (5), the Secretaries will, 
                        based in part on information obtained 
                        pursuant to such call, make a 
                        recommendation under paragraph (6) that 
                        the special reserve fund under 
                        paragraph (10) be made available for 
                        the procurement of such security 
                        countermeasure.
                  (B) Countermeasure specifications.--The 
                Homeland Security Secretary and the Secretary 
                shall, to the extent practicable, include in 
                the proposal under subparagraph (A)--
                          (i) estimated quantity of purchase 
                        (in the form of number of doses or 
                        number of effective courses of 
                        treatments regardless of dosage form);
                          (ii) necessary measures of minimum 
                        safety and effectiveness;
                          (iii) estimated price for each dose 
                        or effective course of treatment 
                        regardless of dosage form; and
                          (iv) other information that may be 
                        necessary to encourage and facilitate 
                        research, development, and manufacture 
                        of the countermeasure or to provide 
                        specifications for the countermeasure.
                  (C) Presidential approval.--If the President 
                approves a proposal under subparagraph (A), the 
                Homeland Security Secretary and the Secretary 
                shall make known to persons who may respond to 
                a call for the security countermeasure 
                involved--
                          (i) the call for the countermeasure;
                          (ii) specifications for the 
                        countermeasure under subparagraph (B); 
                        and
                          (iii) a commitment described in 
                        subparagraph (A)(ii).
          (5) Secretary's determination of countermeasures 
        appropriate for funding from special reserve fund.--
                  (A) In general.--The Secretary, in accordance 
                with the provisions of this paragraph, shall 
                identify specific security countermeasures that 
                the Secretary determines, in consultation with 
                the Homeland Security Secretary, to be 
                appropriate for inclusion in the stockpile 
                under subsection (a) pursuant to procurements 
                made with amounts in the special reserve fund 
                under paragraph (10) (referred to in this 
                subsection individually as a ``procurement 
                under this subsection'').
                  (B) Requirements.--In making a determination 
                under subparagraph (A) with respect to a 
                security countermeasure, the Secretary shall 
                determine and consider the following:
                          (i) The quantities of the product 
                        that will be needed to meet the needs 
                        of the stockpile.
                          (ii) The feasibility of production 
                        and delivery within five years of 
                        sufficient quantities of the product.
                          (iii) Whether there is a lack of a 
                        significant commercial market for the 
                        product at the time of procurement, 
                        other than as a security 
                        countermeasure.
          (6) Recommendation for president's approval.--
                  (A) Recommendation for procurement.--In the 
                case of a security countermeasure that the 
                Secretary has, in accordance with paragraphs 
                (2), (3), and (5), determined to be appropriate 
                for procurement under this subsection, the 
                Homeland Security Secretary and the Secretary 
                shall jointly submit to the President, in 
                coordination with the Director of the Office of 
                Management and Budget, a recommendation that 
                the special reserve fund under paragraph(10) be 
made available for the procurement of such countermeasure.
                  (B) Presidential approval.--The special 
                reserve fund under paragraph (10) is available 
                for a procurement of a security countermeasure 
                only if the President has approved a 
                recommendation under subparagraph (A) regarding 
                the countermeasure.
                  (C) Notice to congress.--The Secretary and 
                the Homeland Security Secretary shall notify 
                the Congress of each decision of the President 
                to approve a recommendation under subparagraph 
                (A). Such notice shall include an explanation 
                of the decision to make available the special 
                reserve fund under paragraph (10) for 
                procurement of such a countermeasure, 
                including, where available, the identification 
                of the potential supplier or suppliers of such 
                countermeasure, and whether other potential 
                suppliers of the same or similar 
                countermeasures were considered and rejected 
                for procurement under this section and the 
                reasons therefor.
                  (D) Subsequent specific countermeasures.--
                Procurement under this subsection of a security 
                countermeasure for a particular purpose does 
                not preclude the subsequent procurement under 
                this subsection of any other security 
                countermeasure for such purpose if the 
                Secretary has determined under paragraph (5)(A) 
                that such countermeasure is appropriate for 
                inclusion in the stockpile and if, as 
                determined by the Secretary, such 
                countermeasure provides improved safety or 
                effectiveness, or for other reasons enhances 
                preparedness to respond to threats of use of a 
                biological, chemical, radiological, or nuclear 
                agent. Such a determination by the Secretary is 
                committed to agency discretion.
                  (E) Rule of construction.--Recommendations 
                and approvals under this paragraph apply solely 
                to determinations that the special reserve fund 
                under paragraph (10) will be made available for 
                a procurement of a security countermeasure, and 
                not to the substance of contracts for such 
                procurement or other matters relating to awards 
                of such contracts.
          (7) Procurement.--
                  (A) In general.--For purposes of a 
                procurement under this subsection that is 
                approved by the President under paragraph (6), 
                the Homeland Security Secretary and the 
                Secretary shall have responsibilities in 
                accordance with subparagraphs (B) and (C).
                  (B) Interagency agreements.--
                          (i) For procurement.--The Homeland 
                        Security Secretary shall enter into an 
                        agreement with the Secretary for 
                        procurement of a security 
                        countermeasure in accordance with the 
                        provisions of this paragraph. The 
                        special reserve fund under paragraph 
                        (10) shall be available for the 
                        Secretary's costs of such procurement, 
                        other than as provided in clause (ii).
                          (ii) For administrative costs.--The 
                        agreement entered into between the 
                        Homeland Security Secretary and the 
                        Secretary for managing the stockpile 
                        under subsection (a) shall provide for 
                        reimbursement of the Secretary's 
                        administrative costs relating to 
                        procurements under this subsection.
                  (C) Procurement.--
                          (i) In general.--The Secretary shall 
                        be responsible for--
                                  (I) arranging for procurement 
                                of a security countermeasure, 
                                including negotiating terms 
                                (including quantity, production 
                                schedule, and price) of, and 
                                entering into, contracts and 
                                cooperative agreements, and for 
                                carrying out such other 
                                activities as may reasonably be 
                                required, in accordance with 
                                the provisions of this 
                                subparagraph; and
                                  (II) promulgating regulations 
                                to implement clauses (v), (vi), 
                                and (vii), and any other 
                                provisions of this subsection.
                          (ii) Contract terms.--A contract for 
                        procurements under this subsection 
                        shall (or, as specified below, may) 
                        include the following terms:
                                  (I) Payment conditioned on 
                                substantial delivery.--The 
                                contract shall provide that no 
                                payment may be made until 
                                delivery has been made of a 
                                substantial portion (as 
                                determined by the Secretary) of 
                                the total number of units 
                                contracted for, except that, 
                                notwithstanding any other 
                                provision of law, the contract 
                                may provide that, if the 
                                Secretary determines (in the 
                                Secretary's discretion) that an 
                                advance payment is necessary to 
                                ensure success of a project, 
                                the Secretary may pay an 
                                amount, not to exceed 10 
                                percent of the contract amount, 
                                in advance of delivery. The 
                                contract shall provide that 
                                such advance payment is 
                                required to be repaid if there 
                                is a failure to perform under 
                                the contract, except in special 
                                circumstances as determined by 
                                the Secretary on a contract by 
                                contract basis.
                                  (II) Contract duration.--The 
                                contract shall be for a period 
                                not to exceed five years, 
                                except that, in first awarding 
                                the contract, the Secretary may 
                                provide for a longer duration, 
                                not exceeding eight years, if 
                                the Secretary determines that 
                                complexities or other 
                                difficulties in performance 
                                under the contract justify such 
                                a period. The contract shall be 
                                renewable for additional 
                                periods, none of which shall 
                                exceed five years.
                                  (III) Storage by vendor.--The 
                                contract may provide that the 
                                vendor will provide storage for 
                                stocks of a product delivered 
                                to the ownership of the Federal 
                                Government under the contract, 
                                for such period and under such 
                                terms and conditions as the 
                                Secretary may specify, and in 
                                such case amounts from the 
                                special reserve fund under 
                                paragraph (10) shall be 
                                available for costs of 
                                shipping,handling, storage, and 
related costs for such product.
                          (iii) Availability of simplified 
                        acquisition procedures.--
                                  (I) In general.--The amount 
                                of any procurement under this 
                                subsection shall be deemed to 
                                be below the threshold amount 
                                specified in section 4(11) of 
                                the Office of Federal 
                                Procurement Policy Act (41 
                                U.S.C. 403(11)), for purposes 
                                of application to such 
                                procurement, pursuant to 
                                section 302A(a) of the Federal 
                                Property and Administrative 
                                Services Act of 1949 (41 U.S.C. 
                                252a(a)), of--
                                          (aa) section 
                                        303(g)(1)(A) of the 
                                        Federal Property and 
                                        Administrative Services 
                                        Act of 1949 (41 U.S.C. 
                                        253(g)(1)(A)) and its 
                                        implementing 
                                        regulations; and
                                          (bb) section 302A(b) 
                                        of such Act (41 U.S.C. 
                                        252a(b)) and its 
                                        implementing 
                                        regulations.
                                  (II) Application of certain 
                                provisions.--Notwithstanding 
                                subclause (I) and the provision 
                                of law and regulations referred 
                                to in such clause, each of the 
                                following provisions shall 
                                apply to procurements described 
                                in this clause to the same 
                                extent that such provisions 
                                would apply to such 
                                procurements in the absence of 
                                subclause (I):
                                          (aa) Chapter 37 of 
                                        title 40, United States 
                                        Code (relating to 
                                        contract work hours and 
                                        safety standards).
                                          (bb) Subsections (a) 
                                        and (b) of Section 7 of 
                                        the Anti-Kickback Act 
                                        of 1986 (41 U.S.C. 
                                        57(a) and (b)).
                                          (cc) Section 304C of 
                                        the Federal Property 
                                        and Administrative 
                                        Services Act of 1949 
                                        (41 U.S.C. 254d) 
                                        (relating to the --- 
                                        examination of 
                                        contractor records).
                          (iv) Use of noncompetitive 
                        procedures.--In addition to any other 
                        authority to use procedures other than 
                        competitive procedures, the Secretary 
                        may use such other procedures for a 
                        procurement under this subsection if 
                        the product is available from only one 
                        responsible source or only from a 
                        limited number of responsible sources, 
                        and no other type of product will 
                        satisfy the Secretary's needs.
                          (v) Premium provision in multiple 
                        award contracts.--
                                  (I) In general.--If, under 
                                this subsection, the Secretary 
                                enters into contracts with more 
                                than one vendor to procure a 
                                security countermeasure, such 
                                Secretary may, notwithstanding 
                                any other provision of law, 
                                include in each of such 
                                contracts a provision that--
                                          (aa) identifies an 
                                        increment of the total 
                                        quantity of security 
                                        countermeasure 
                                        required, whether by 
                                        percentage or by 
                                        numbers of units; and
                                          (bb) promises to pay 
                                        one or more specified 
                                        premiums based on the 
                                        priority of such 
                                        vendors' production and 
                                        delivery of the 
                                        increment identified 
                                        under item (aa), in 
                                        accordance with the 
                                        terms and conditions of 
                                        the contract.
                                  (II) Determination of 
                                government's requirement not 
                                reviewable.--If the Secretary 
                                includes in each of a set of 
                                contracts a provision as 
                                described in subclause (I), 
                                such Secretary's determination 
                                of the total quantity of 
                                security countermeasure 
                                required, and any amendment of 
                                such determination, is 
                                committed to agency discretion.
                          (vi) Extension of closing date for 
                        receipt of proposals not reviewable.--A 
                        decision by the Secretary to extend the 
                        closing date for receipt of proposals 
                        for a procurement under this subsection 
                        is committed to agency discretion.
                          (vii) Limiting competition to sources 
                        responding to request for 
                        information.--In conducting a 
                        procurement under this subsection, the 
                        Secretary may exclude a source that has 
                        not responded to a request for 
                        information under section 303A(a)(1)(B) 
                        of the Federal Property and 
                        Administrative Services Act of 1949 (41 
                        U.S.C. 253a(a)(1)(B)) if such request 
                        has given notice that the Secretary may 
                        so exclude such a source.
          (8) Interagency cooperation.--
                  (A) In general.--In carrying out activities 
                under this section, the Homeland Security 
                Secretary and the Secretary are authorized, 
                subject to subparagraph (B), to enter into 
                interagency agreements and other collaborative 
                undertakings with other agencies of the United 
                States Government.
                  (B) Limitation.--An agreement or undertaking 
                under this paragraph shall not authorize 
                another agency to exercise the authorities 
                provided by this section to the Homeland 
                Security Secretary or to the Secretary.
          (9) Restrictions on use of funds.--Amounts in the 
        special reserve fund under paragraph (10) shall not be 
        used to pay--
                  (A) costs for the purchase of vaccines under 
                procurement contracts entered into before the 
                date of the enactment of the Project BioShield 
                Act of 2003; or
                  (B) administrative costs.
          (10) Special reserve fund.--For purposes of this 
        subsection, the term ``special reserve fund'' has the 
        meaning given such term in section 510 of the Homeland 
        Security Act of 2002.
  (d) Disclosures.--No Federal agency shall disclose under 
section 552, United States Code, any information identifying 
the location at which materials in the stockpile under 
subsection (a) are stored.
  (e) Definition.--For purposes of subsection (a), the term 
``stockpile'' includes--
          (1) a physical accumulation (at one or more 
        locations) of the supplies described in subsection (a); 
        or
          (2) a contractual agreement between the Homeland 
        Security Secretary and a vendor or vendors under which 
        such vendor or vendors agree to provide to such 
        Secretary supplies described in subsection (a).
  (f) Authorization of Appropriations.--
          (1) Strategic national stockpile.--For the purpose of 
        carrying out subsection (a), there are authorized to be 
        appropriated $640,000,000 for fiscal year 2002, and 
        such sums as may be necessary for each of fiscal years 
        2003 through 2006. Such authorization is in addition to 
        amounts in the special reserve fund under subsection 
        (c)(10).
          (2) Smallpox vaccine development.--For the purpose of 
        carrying out subsection (b), there are authorized to be 
        appropriated $509,000,000 for fiscal year 2002, and 
        such sums as may be necessary for each of fiscal years 
        2003 through 2006.

           *       *       *       *       *       *       *


TITLE IV--NATIONAL RESEARCH INSTITUTES

           *       *       *       *       *       *       *



Part E--Other Agencies of NIH

           *       *       *       *       *       *       *



SEC. 481A. BIOMEDICAL AND BEHAVIORAL RESEARCH FACILITIES.

  (a) Modernization and Construction of Facilities.--
          (1) In general.--The Director of NIH, acting through 
        the Director of the Center or the Director of the 
        National Institute of Allergy and Infectious Diseases, 
        may make grants or contracts to public and nonprofit 
        private entities to expand, remodel, renovate, or alter 
        existing research facilities or construct new research 
        facilities, subject to the provisions of this section.

           *       *       *       *       *       *       *

  (c) Requirements for Grants.--
          (1) In general.--The Director of the Center or the 
        Director of the National Institute of Allergy and 
        Infectious Diseases may make a grant under subsection 
        (a) only if the applicant for the grant meets the 
        following conditions:
                  (A) * * *

           *       *       *       *       *       *       *

          (2) Institutions of emerging excellence.--From the 
        amount appropriated under [subsection (i)] subsection 
        (i)(1) for a fiscal year up to $50,000,000, the 
        Director of the Center shall make available 25 percent 
        of such amount, and from the amount appropriated under 
        such subsection for a fiscal year that is over 
        $50,000,000, the Director of the Center shall make 
        available up to 25 percent of such amount, for grants 
        under subsection (a) to applicants that in addition to 
        meeting the requirements established in paragraph (1), 
        have demonstrated emerging excellence in biomedical or 
        behavioral research, as follows:
                  (A) * * *

           *       *       *       *       *       *       *

  (d) Requirement of Application.--The Director of the Center 
or the Director of the National Institute of Allergy and 
Infectious Diseases may make a grant under subsection (a) only 
if an application for the grant is submitted to the Director 
and the application is in such form, is made in such manner, 
and contains such agreements, assurances, and information as 
the Director determines to be necessary to carry out this 
section.
  (e) Amount of Grant; Payments.--
          (1) Amount.--The amount of any grant awarded under 
        subsection (a) shall be determined by the Director of 
        the Center or the Director of the National Institute of 
        Allergy and Infectious Diseases, except that such 
        amount shall not exceed--
                  (A) 50 percent (or, in the case of the 
                Institute, 75 percent) of the necessary cost of 
                the construction of a proposed facility as 
                determined by the Director; or
                  (B) in the case of a multipurpose facility, 
                40 percent (or, in the case of the Institute, 
                75 percent) of that part of the necessary cost 
                of construction that the Director determines to 
                be proportionate to the contemplated use of the 
                facility.
          (2) Reservation of amounts.--On the approval of any 
        application for a grant under subsection (a), the 
        Director of the Center or the Director of the National 
        Institute of Allergy and Infectious Diseases shall 
        reserve, from any appropriation available for such 
        grants, the amount of such grant, and shall pay such 
        amount, in advance or by way of reimbursement, and in 
        such installments consistent with the construction 
        progress, as the Director may determine appropriate. 
        The reservation of any amount by the Director under 
        this paragraph may be amended by the Director, either 
        on the approval of an amendment of the application or 
        on the revision of the estimated cost of construction 
        of the facility.

           *       *       *       *       *       *       *

          (4) Waiver of limitations.--The limitations imposed 
        under paragraph (1) may be waived at the discretion of 
        the Director of the Center or the Director of the 
        National Institute of Allergy and Infectious Diseases 
        for applicants meeting the conditions described in 
        subsection (c).
  (f ) Recapture of Payments.--If, not later than 20 years 
after the completion of construction for which a grant has been 
awarded under subsection (a)--
          (1) in the case of an award by the Director of the 
        Center, the applicant or other owner of the facility 
        shall cease to be a public or non profit private 
        entity; or
          (2) the facility shall cease to be used for the 
        research purposes for which it was constructed (unless 
        the Director of the Center or the Director of the 
        National Institute of Allergy and Infectious Diseases 
        determines, in accordance with regulations,that there 
is good cause for releasing the applicant or other owner from 
obligation to do so),
the United States shall be entitled to recover from the 
applicant or other owner of the facility the amount bearing the 
same ratio to the current value (as determined by an agreement 
between the parties or by action brought in the United States 
District Court for the district in which such facility is 
situated) of the facility as the amount of the Federal 
participation bore to the cost of the construction of such 
facility.

           *       *       *       *       *       *       *

  (i) Authorization of [Appropriations.--For the purpose of 
carrying out this section,] Appropriations.--
          (1) Center.--For the purpose of carrying out this 
        section with respect to the Center, there are 
        authorized to be appropriated $250,000,000 for fiscal 
        year 2001, and such sums as may be necessary for each 
        of the fiscal years 2002 and 2003.
          (2) National institute of allergy and infectious 
        diseases.--For the purpose of carrying out this section 
        with respect to the National Institute of Allergy and 
        Infectious Diseases, there are authorized to be 
        appropriated such sums as may be necessary for fiscal 
        year 2003.
                              ----------                              


            SECTION 510 OF THE HOMELAND SECURITY ACT OF 2002

SEC. 510. PROCUREMENT OF SECURITY COUNTERMEASURES FOR STRATEGIC 
                    NATIONAL STOCKPILE.

  (a) Authorization of Appropriations.--For procurement of 
security countermeasures under section 319F-2(c) of the Public 
Health Service Act (referred to in this section as the 
``security countermeasures program''), there is authorized to 
be appropriated up to $5,593,000,000 for the fiscal years 2004 
through 2013. Of the amounts appropriated under the preceding 
sentence, not to exceed $3,418,000,000 may be obligated during 
the fiscal years 2004 through 2008, of which not to exceed 
$890,000,000 may be obligated during fiscal year 2004.
  (b) Special Reserve Fund.--For purposes of the security 
countermeasures program, the term ``special reserve fund'' 
means the appropriations account established as a result of any 
appropriations made under subsection (a).
  (c) Availability.--
          (1) Duration of availability for obligation.--Subject 
        to paragraph (2), all amounts appropriated under 
        subsection (a) are available for obligation through the 
        end of fiscal year 2013, provided that any portion of 
        such amount that remains unobligated for such purposes 
        on the expiration of such term shall be returned to the 
        United States Treasury and shall not be available for 
        subsequent obligation for any purpose.
          (2) Initial availability for particular 
        procurements.--Amounts appropriated under subsection 
        (a) become available for a procurement under the 
        security countermeasures program only upon the approval 
        by the President of such availability for the 
        procurement in accordance with paragraph (6)(B) of such 
        program.
                              ----------                              


SECTION 121 OF THE PUBLIC HEALTH SECURITY AND BIOTERRORISM PREPAREDNESS 
                        AND RESPONSE ACT OF 2002

[SEC. 121. STRATEGIC NATIONAL STOCKPILE.

  [(a) Strategic National Stockpile.--
          [(1) In general.--The Secretary of Health and Human 
        Services (referred to in this section as the 
        ``Secretary''), in coordination with the Secretary of 
        Veterans Affairs, shall maintain a stockpile or 
        stockpiles of drugs, vaccines and other biological 
        products, medical devices, and other supplies in such 
        numbers, types, and amounts as are determined by the 
        Secretary to be appropriate and practicable, taking 
        into account other available sources, to provide for 
        the emergency health security of the United States, 
        including the emergency health security of children and 
        other vulnerable populations, in the event of a 
        bioterrorist attack or other public health emergency.
          [(2) Procedures.--The Secretary, in managing the 
        stockpile under paragraph (1), shall--
                  [(A) consult with the working group under 
                section 319F(a) of the Public Health Service 
                Act;
                  [(B) ensure that adequate procedures are 
                followed with respect to such stockpile for 
                inventory management and accounting, and for 
                the physical security of the stockpile;
                  [(C) in consultation with Federal, State, and 
                local officials, take into consideration the 
                timing and location of special events;
                  [(D) review and revise, as appropriate, the 
                contents of the stockpile on a regular basis to 
                ensure that emerging threats, advanced 
                technologies, and new countermeasures are 
                adequately considered;
                  [(E) devise plans for the effective and 
                timely supply-chain management of the 
                stockpile, in consultation with appropriate 
                Federal, State and local agencies, and the 
                public and private health care infrastructure; 
                and
                  [(F) ensure the adequate physical security of 
                the stockpile.
  [(b) Smallpox Vaccine Development.--
          [(1) In general.--The Secretary shall award 
        contracts, enter into cooperative agreements, or carry 
        out such other activities as may reasonably be required 
        in order to ensure that the stockpile under subsection 
        (a) includes an amount of vaccine against smallpox as 
        determined by the Secretary to be sufficient to meet 
        the health security needs of the United States.
          [(2) Rule of construction.--Nothing in this section 
        shall be construed to limit the private distribution, 
        purchase, or sale of vaccines from sources other than 
        the stockpile described in subsection (a).
  [(c) Disclosures.--No Federal agency shall disclose under 
section 552, United States Code, any information identifying 
the location at which materials in the stockpile under 
subsection (a) are stored.
  [(d) Definition.--For purposes of subsection (a), the term 
``stockpile'' includes--
          [(1) a physical accumulation (at one or more 
        locations) of the supplies described in subsection (a); 
        or
          [(2) a contractual agreement between the Secretary 
        and a vendor or vendors under which such vendor or 
        vendors agree to provide to the Secretary supplies 
        described in subsection (a).
  [(e) Authorization of Appropriations.--
          [(1) Strategic national stockpile.--For the purpose 
        of carrying out subsection (a), there are authorized to 
        be appropriated $640,000,000 for fiscal year 2002, and 
        such sums as may be necessary for each of fiscal years 
        2003 through 2006.
          [(2) Smallpox vaccine development.--For the purpose 
        of carrying out subsection (b), there are authorized to 
        be appropriated $509,000,000 for fiscal year 2002, and 
        such sums as may be necessary for each of fiscal years 
        2003 through 2006.]
                              ----------                              


        SECTION 564 OF THE FEDERAL FOOD, DRUG, AND COSMETIC ACT


SEC. 564. AUTHORIZATION FOR MEDICAL PRODUCTS FOR USE IN EMERGENCIES.

  (a) In General.--
          (1) Emergency uses.--Notwithstanding sections 505, 
        510(k), and 515 of this Act and section 351 of the 
        Public Health Service Act, and subject to the 
        provisions of this section, the Secretary may authorize 
        the introduction into interstate commerce, during the 
        effective period of a declaration under subsection (b), 
        of a drug or device intended for use in an actual or 
        potential emergency (referred to in this section as an 
        ``emergency use'').
          (2) Approval status of product.--An authorization 
        under paragraph (1) may authorize an emergency use of a 
        product that--
                  (A) is not approved, licensed, or cleared for 
                commercial distribution under a provision of 
                law referred to in such paragraph (referred to 
                in this section as an ``unapproved product''); 
                or
                  (B) is approved, licensed, or cleared under 
                such a provision, but which use is not under 
                such provision an approved, licensed, or 
                cleared use of the product (referred to in this 
                section as an ``unapproved use of an approved 
                product'').
          (3) Relation to other uses.--An emergency use 
        authorized under paragraph (1) for a product is in 
        addition to any other use that is authorized for the 
        product under a provision of law referred to in such 
        paragraph.
          (4) Definitions.--For purposes of this section:
                  (A) The term ``emergency use'' has the 
                meaning indicated for such term in paragraph 
                (1).
                  (B) The term ``product'' means a drug or 
                device.
                  (C) The term ``unapproved product'' has the 
                meaning indicated for such term in paragraph 
                (2)(A).
                  (D) The term ``unapproved use of an approved 
                product'' has the meaning indicated for such 
                term in paragraph (2)(B).
  (b) Declaration of Emergency.--
          (1) In general.--The Secretary may declare an 
        emergency justifying the authorization under this 
        subsection for a product on the basis of--
                  (A) a determination by the Secretary of 
                Homeland Security that there is a national 
                emergency, or a significant potential for a 
                national emergency, involving a heightened risk 
                of attack with a specified biological, 
                chemical, radiological, or nuclear agent or 
                agents;
                  (B) a determination by the Secretary of 
                Defense that there is a military emergency, or 
                a significant potential for a military 
                emergency, involving a heightened risk to 
                United States military forces of attack with a 
                biological, chemical, radiological, or nuclear 
                agent or agents; or
                  (C) a determination by the Secretary of a 
                public health emergency under section 319 of 
                the Public Health Service Act, affecting 
                national security and involving a specified 
                biological, chemical, radiological, or nuclear 
                agent or agents, or a specified disease or 
                condition that may be attributable to such 
                agent or agents.
          (2) Termination of declaration.--
                  (A) In general.--A declaration under this 
                subsection shall terminate upon the earlier 
                of--
                          (i) a determination by the Secretary, 
                        in consultation as appropriate with the 
                        Secretary of Homeland Security or the 
                        Secretary of Defense, that the 
                        circumstances described in paragraph 
                        (1) have ceased to exist; or
                          (ii) the expiration of the one-year 
                        period beginning on the date on which 
                        the declaration is made.
                  (B) Renewal.--Notwithstanding subparagraph 
                (A), the Secretary may renew a declaration 
                under this subsection, and this paragraph shall 
                apply to any such renewal.
          (3) Advance notice of termination.--In terminating a 
        declaration under this section, the Secretary shall 
        provide advance notice that the declaration will be 
        terminated. The period of advance notice shall be a 
        period reasonably determined to provide--
                  (A) in the case of an unapproved product, a 
                sufficient period for disposition of shipments 
                of the product, including the return of such 
                shipments to the manufacturer (in the case of a 
                manufacturer that chooses to have the shipments 
                returned); and
                  (B) in the case of unapproved uses of 
                approved products, a sufficient period for the 
                disposition of any labelingthat was provided 
with respect to the emergency use involved.
          (4) Publication.--The Secretary shall promptly 
        publish in the Federal Register each declaration, 
        determination, and renewal under this subsection.
  (c) Criteria for Issuance of Authorization.--The Secretary 
may issue an authorization under this section with respect to 
the emergency use of a product only if, after consultation with 
the Director of the National Institutes of Health and the 
Director of the Centers for Disease Control and Prevention, to 
the extent feasible and appropriate given the circumstances of 
the emergency involved, the Secretary concludes--
          (1) that an agent specified in a declaration under 
        subsection (b) can cause a serious or life-threatening 
        disease or condition;
          (2) that, based on the totality of scientific 
        evidence available to the Secretary, including data 
        from adequate and well-controlled clinical trials, if 
        available, it is reasonable to believe that--
                  (A) the product may be effective in 
                detecting, diagnosing, treating, or 
                preventing--
                          (i) such disease or condition; or
                          (ii) a serious or life-threatening 
                        disease or condition caused by a 
                        product authorized under this section 
                        or approved under this Act or the 
                        Public Health Service Act, for 
                        detecting, diagnosing, treating, or 
                        preventing such a disease or condition 
                        caused by such an agent; and
                  (B) the known and potential benefits of the 
                product, when used to detect, diagnose, 
                prevent, or treat such disease or condition, 
                outweigh the known and potential risks of the 
                product;
          (3) that there is no adequate, approved, and 
        available alternative to the product for detecting, 
        diagnosing, preventing, or treating such disease or 
        condition; and
          (4) that such other criteria as the Secretary may by 
        regulation prescribe are satisfied.
  (d) Scope of Authorization.--
          (1) In general.--An authorization of a product under 
        this section shall state--
                  (A) each disease or condition that the 
                product may be used to detect, diagnose, 
                prevent, or treat within the scope of the 
                authorization;
                  (B) the Secretary's conclusions, made under 
                subsection (c)(2)(B), that the known and 
                potential benefits of the product, when used to 
                detect, diagnose, prevent, or treat such 
                disease or condition, outweigh the known and 
                potential risks of the product; and
                  (C) the Secretary's conclusions, made under 
                subsection (c), concerning the safety and 
                potential effectiveness of the product in 
                detecting, diagnosing, preventing, or treating 
                such diseases or conditions, including an 
                assessment of the available scientific 
                evidence.
          (2) Confidential information.--Nothing in this 
        section alters or amends section 1905 of title 18, 
        United States Code, or section 552(b)(4) of title 5 of 
        such Code.
  (e) Conditions of Authorization.--
          (1) Unapproved product.--
                  (A) Required conditions.--With respect to the 
                emergency use of an unapproved product, the 
                Secretary, to the extent feasible given the 
                circumstances of the emergency, shall, for 
                persons who choose to carry out one or more 
                activities for which the authorization is 
                issued, establish such conditions on an 
                authorization under this section as the 
                Secretary finds necessary or appropriate to 
                protect the public health, including the 
                following:
                          (i) Appropriate conditions designed 
                        to ensure that, to the extent feasible 
                        given the circumstances of the 
                        emergency, health care professionals 
                        administering the product are 
                        informed--
                                  (I) that the Secretary has 
                                authorized the emergency use of 
                                the product;
                                  (II) of the significant known 
                                and potential benefits and 
                                risks of the emergency use of 
                                the product, and of the extent 
                                to which such benefits and 
                                risks are unknown; and
                                  (III) of the alternatives to 
                                the product that are available, 
                                and of their benefits and 
                                risks.
                          (ii) Appropriate conditions designed 
                        to ensure that, to the extent feasible 
                        given the circumstances of the 
                        emergency, individuals to whom the 
                        product is administered are informed--
                                  (I) that the Secretary has 
                                authorized the emergency use of 
                                the product;
                                  (II) of the significant known 
                                and potential benefits and 
                                risks of such use, and of the 
                                extent to which such benefits 
                                and risks are unknown; and
                                  (III) of the option to accept 
                                or refuse administration of the 
                                product, of the consequences, 
                                if any, of refusing 
                                administration of the product, 
                                and of the alternatives to the 
                                product that are available and 
                                of their benefits and risks.
                          (iii) Appropriate conditions for the 
                        monitoring and reporting of adverse 
                        events associated with the emergency 
                        use of the product.
                          (iv) For manufacturers of the 
                        product, appropriate conditions 
                        concerning recordkeeping and reporting, 
                        including records access by the 
                        Secretary, with respect to the 
                        emergency use of the product.
                  (B) Authority for additional conditions.--
                With respect to the emergency use of an 
                unapproved product, the Secretary, to the 
                extent feasible given the circumstances of the 
                emergency, may, for persons who choose to carry 
                out one or more activities for which the 
                authorization is issued, establish such 
                conditions on an authorization under this 
                section as the Secretary finds necessary or 
                appropriate to protect the public health, 
                including the following:
                          (i) Appropriate conditions on which 
                        entities may distribute the product 
                        with respect to the emergency use of 
                        the product (including limitation to 
                        distribution by government entities), 
                        and on how distribution is to be 
                        performed.
                          (ii) Appropriate conditions on who 
                        may administer the product with respect 
                        to the emergency use of the product, 
                        and on the categories of individuals to 
                        whom, and the circumstances under 
                        which, the product may be administered 
                        with respect to such use.
                          (iii) For persons other than 
                        manufacturers of the product, 
                        appropriate conditions concerning 
                        recordkeeping and reporting, including 
                        records access by the Secretary, with 
                        respect to the emergency use of the 
                        product.
                          (iv) With respect to the emergency 
                        use of the product, waive or limit, to 
                        the extent appropriate given the 
                        circumstances of the emergency, 
                        conditions regarding current good 
                        manufacturing practice otherwise 
                        applicable to the manufacture, 
                        processing, packing, or holding of 
                        products subject to regulation under 
                        this Act, including such requirements 
                        established in section 501.
          (2) Unapproved use.--With respect to the emergency 
        use of a product that is an unapproved use of an 
        approved product:
                  (A) The Secretary may, for manufacturers of 
                the product who choose to carry out one or more 
                activities for which the authorization is 
                issued, establish any of the conditions 
                described in clauses (i) through (iv) of 
                paragraph (1)(A).
                  (B)(i) If the authorization under this 
                section regarding the emergency use authorizes 
                a change in the labeling of the product, but 
                the manufacturer of the product chooses not to 
                make such change, such authorization may not 
                authorize distributors of the product or any 
                other person to alter or obscure the labeling 
                provided by the manufacturer.
                  (ii) In the circumstances described in clause 
                (i), an authorization under this section 
                regarding the emergency use may, for persons 
                who do not manufacture the product and who 
                choose to act under this clause, authorize such 
                persons to provide information on the product 
                in addition to the labeling provided by the 
                manufacturer, subject to compliance with clause 
                (i). Such additional information shall not be 
                considered labeling for purposes of section 
                502.
  (f) Duration of Authorization.--
          (1) In general.--Except as provided in paragraph (2), 
        an authorization under this section shall be effective 
        until the earlier of the termination of the declaration 
        under subsection (b) or a revocation under subsection 
        (g).
          (2) Continued use after end of effective period.--An 
        authorization shall continue to be effective for 
        continued use with respect to patients to whom it was 
        administered during the period described by paragraph 
        (1), to the extent found necessary by such patients' 
        attending physicians.
  (g) Revocation of Authorization.--
          (1) Review.--The Secretary shall periodically review 
        the circumstances and the appropriateness of an 
        authorization under this section.
          (2) Revocation.--The Secretary may revoke an 
        authorization under this section if, in the Secretary's 
        unreviewable discretion, the criteria under subsection 
        (c) for issuance of such authorization are no longer 
        met.
  (h) Publication.--The Secretary shall promptly publish in the 
Federal Register a notice of each authorization, and each 
termination or revocation of an authorization, and an 
explanation of the reasons therefor, under this section.
  (i) Actions Committed to Agency Discretion.--Actions under 
the authority of this section by the Secretary, by the 
Secretary of Defense, or by the Secretary of Homeland Security 
are committed to agency discretion.
  (j) Rules of Construction.--Nothing in this section shall be 
construed to impair or otherwise affect--
          (1) the authority of the President as Commander in 
        Chief of the Armed Forces of the United States under 
        article II, section 2 of the United States 
        Constitution;
          (2) the authority of the Secretary of Defense with 
        respect to the Department of Defense, including the 
        armed forces, under other provisions of Federal law; or
          (3) the authority of the Secretary under section 
        319F-2 to manage the stockpile under such section.
  (k) Application to Members of Armed Forces.--
          (1) Waiver of requirement relating to option to 
        refuse.--In the case of administration of a 
        countermeasure to members of the armed forces, a 
        requirement, under subsection (e)(1)(A)(ii)(III), 
        designed to ensure that individuals are informed of an 
        option to accept or refuse administration of a product, 
        may be waived by the President if the President 
        determines, in writing, that complying with such 
        requirement is not feasible, is contrary to the best 
        interests of the members affected, or is not in the 
        interests of national security.
          (2) Provision of information to member of the armed 
        forces.--If the Secretary makes a determination that it 
        is not feasible for the information required by 
        subsection (e)(1)(A)(ii) to be provided to a member of 
        the armed forces prior to the administration of the 
        product, such information shall be provided to such 
        member of the armed forces (or next-of-kin in the case 
        of the death of a member) to whom the product was 
        administered as soon as possible, but not later than 30 
        days, after such administration. Information concerning 
        the administration of the product shall be recorded in 
        the medical record of the member.
          (3) Effect on statute pertaining to investigational 
        new drugs.--In the case of an authorization based on a 
        determination by the Secretary of Defense under 
        subsection (b)(1)(B), section 1107 of title 10, United 
        States Code, shall not apply to use of a product that 
        is the subject of such authorization, within the scope 
        of such authorization and while such authorization is 
        effective.
  (l) Relation to Other Provisions.--If a product is the 
subject of an authorization under this section, the use of such 
product within the scope of the authorization --
          (1) shall not be subject to any requirements pursuant 
        to section 505(i) or 520(g); and
          (2) shall not be subject to any requirements 
        otherwise applicable to clinical investigations 
        pursuant to other provisions of this Act.
  (m) Discretion Regarding Use of Authorization.--Nothing in 
this section provides the Secretary any authority to require 
any person to carry out any activity that becomes lawful 
pursuant to an authorization under this section, and no person 
is required to inform the Secretary that the person will not be 
carrying out such activity, except that a manufacturer of a 
sole-source unapproved product authorized for emergency use 
shall notify the Secretary within a reasonable period of time 
after the issuance by the Secretary of such authorization if 
such manufacturer does not intend to carry out an activity or 
activities under the authorization. This section does not have 
any legal effect on a person who does not carry out any 
activity for which an authorization under this section is 
issued, or who carries out such an activity pursuant to other 
provisions of this Act or section 351 of the Public Health 
Service Act.
  (n) Enforcement.--A person who carries out an activity 
pursuant to an authorization under this section, but who fails 
to comply with applicable conditions under subsection (e), is 
with respect to that act of noncompliance subject to the 
provisions of law specified in subsection (a) and to the 
enforcement of such provisions under section 301.

                                
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