[Congressional Bills 111th Congress]
[From the U.S. Government Printing Office]
[S. 525 Introduced in Senate (IS)]
111th CONGRESS
1st Session
S. 525
To amend the Federal Food, Drug, and Cosmetic Act with respect to the
importation of prescription drugs, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 4, 2009
Mr. Dorgan (for himself, Ms. Snowe, Mr. Grassley, Mr. Kennedy, Mr.
McCain, Ms. Stabenow, Mr. Bingaman, Ms. Collins, Mr. Durbin, Mr. Nelson
of Florida, Mr. Kohl, Mr. Levin, Mr. Leahy, Mr. Sanders, Mr. Kerry, Mr.
Brown, Mr. Feingold, Mr. Johnson, Mr. Inouye, Mr. Tester, Mr. Casey,
Mrs. McCaskill, Mr. Thune, Mr. Begich, and Mrs. Shaheen) introduced the
following bill; which was read twice and referred to the Committee on
Health, Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To amend the Federal Food, Drug, and Cosmetic Act with respect to the
importation of prescription drugs, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Pharmaceutical Market Access and
Drug Safety Act of 2009''.
SEC. 2. FINDINGS.
Congress finds that--
(1) Americans unjustly pay up to 5 times more to fill their
prescriptions than consumers in other countries;
(2) the United States is the largest market for
pharmaceuticals in the world, yet American consumers pay the
highest prices for brand pharmaceuticals in the world;
(3) a prescription drug is neither safe nor effective to an
individual who cannot afford it;
(4) allowing and structuring the importation of
prescription drugs to ensure access to safe and affordable
drugs approved by the Food and Drug Administration will provide
a level of safety to American consumers that they do not
currently enjoy;
(5) American spend more than $200,000,000,000 on
prescription drugs every year;
(6) the Congressional Budget Office has found that the cost
of prescription drugs are between 35 to 55 percent less in
other highly developed countries than in the United States; and
(7) promoting competitive market pricing would both
contribute to health care savings and allow greater access to
therapy, improving health and saving lives.
SEC. 3. REPEAL OF CERTAIN SECTION REGARDING IMPORTATION OF PRESCRIPTION
DRUGS.
Chapter VIII of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
381 et seq.) is amended by striking section 804.
SEC. 4. IMPORTATION OF PRESCRIPTION DRUGS; WAIVER OF CERTAIN IMPORT
RESTRICTIONS.
(a) In General.--Chapter VIII of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 381 et seq.), as amended by section 3, is
further amended by inserting after section 803 the following:
``SEC. 804. COMMERCIAL AND PERSONAL IMPORTATION OF PRESCRIPTION DRUGS.
``(a) Importation of Prescription Drugs.--
``(1) In general.--In the case of qualifying drugs imported
or offered for import into the United States from registered
exporters or by registered importers--
``(A) the limitation on importation that is
established in section 801(d)(1) is waived; and
``(B) the standards referred to in section 801(a)
regarding admission of the drugs are subject to
subsection (g) of this section (including with respect
to qualifying drugs to which section 801(d)(1) does not
apply).
``(2) Importers.--A qualifying drug may not be imported
under paragraph (1) unless--
``(A) the drug is imported by a pharmacy, group of
pharmacies, or a wholesaler that is a registered
importer; or
``(B) the drug is imported by an individual for
personal use or for the use of a family member of the
individual (not for resale) from a registered exporter.
``(3) Rule of construction.--This section shall apply only
with respect to a drug that is imported or offered for import
into the United States--
``(A) by a registered importer; or
``(B) from a registered exporter to an individual.
``(4) Definitions.--
``(A) Registered exporter; registered importer.--
For purposes of this section:
``(i) The term `registered exporter' means
an exporter for which a registration under
subsection (b) has been approved and is in
effect.
``(ii) The term `registered importer' means
a pharmacy, group of pharmacies, or a
wholesaler for which a registration under
subsection (b) has been approved and is in
effect.
``(iii) The term `registration condition'
means a condition that must exist for a
registration under subsection (b) to be
approved.
``(B) Qualifying drug.--For purposes of this
section, the term `qualifying drug' means a drug for
which there is a corresponding U.S. label drug.
``(C) U.S. label drug.--For purposes of this
section, the term `U.S. label drug' means a
prescription drug that--
``(i) with respect to a qualifying drug,
has the same active ingredient or ingredients,
route of administration, dosage form, and
strength as the qualifying drug;
``(ii) with respect to the qualifying drug,
is manufactured by or for the person that
manufactures the qualifying drug;
``(iii) is approved under section 505(c);
and
``(iv) is not--
``(I) a controlled substance, as
defined in section 102 of the
Controlled Substances Act (21 U.S.C.
802);
``(II) a biological product, as
defined in section 351 of the Public
Health Service Act (42 U.S.C. 262),
including--
``(aa) a therapeutic DNA
plasmid product;
``(bb) a therapeutic
synthetic peptide product;
``(cc) a monoclonal
antibody product for in vivo
use; and
``(dd) a therapeutic
recombinant DNA-derived
product;
``(III) an infused drug, including
a peritoneal dialysis solution;
``(IV) an injected drug;
``(V) a drug that is inhaled during
surgery;
``(VI) a drug that is the listed
drug referred to in 2 or more
abbreviated new drug applications under
which the drug is commercially
marketed; or
``(VII) a sterile opthlamic drug
intended for topical use on or in the
eye.
``(D) Other definitions.--For purposes of this
section:
``(i)(I) The term `exporter' means a person
that is in the business of exporting a drug to
individuals in the United States from Canada or
from a permitted country designated by the
Secretary under subclause (II), or that,
pursuant to submitting a registration under
subsection (b), seeks to be in such business.
``(II) The Secretary shall designate a
permitted country under subparagraph (E) (other
than Canada) as a country from which an
exporter may export a drug to individuals in
the United States if the Secretary determines
that--
``(aa) the country has statutory or
regulatory standards that are
equivalent to the standards in the
United States and Canada with respect
to--
``(AA) the training of
pharmacists;
``(BB) the practice of
pharmacy; and
``(CC) the protection of
the privacy of personal medical
information; and
``(bb) the importation of drugs to
individuals in the United States from
the country will not adversely affect
public health.
``(ii) The term `importer' means a
pharmacy, a group of pharmacies, or a
wholesaler that is in the business of importing
a drug into the United States or that, pursuant
to submitting a registration under subsection
(b), seeks to be in such business.
``(iii) The term `pharmacist' means a
person licensed by a State to practice
pharmacy, including the dispensing and selling
of prescription drugs.
``(iv) The term `pharmacy' means a person
that--
``(I) is licensed by a State to
engage in the business of selling
prescription drugs at retail; and
``(II) employs 1 or more
pharmacists.
``(v) The term `prescription drug' means a
drug that is described in section 503(b)(1).
``(vi) The term `wholesaler'--
``(I) means a person licensed as a
wholesaler or distributor of
prescription drugs in the United States
under section 503(e)(2)(A); and
``(II) does not include a person
authorized to import drugs under
section 801(d)(1).
``(E) Permitted country.--The term `permitted
country' means--
``(i) Australia;
``(ii) Canada;
``(iii) a member country of the European
Union, but does not include a member country
with respect to which--
``(I) the country's Annex to the
Treaty of Accession to the European
Union 2003 includes a transitional
measure for the regulation of human
pharmaceutical products that has not
expired; or
``(II) the Secretary determines
that the requirements described in
subclauses (I) and (II) of clause (vii)
will not be met by the date on which
such transitional measure for the
regulation of human pharmaceutical
products expires;
``(iv) Japan;
``(v) New Zealand;
``(vi) Switzerland; and
``(vii) a country in which the Secretary
determines the following requirements are met:
``(I) The country has statutory or
regulatory requirements--
``(aa) that require the
review of drugs for safety and
effectiveness by an entity of
the government of the country;
``(bb) that authorize the
approval of only those drugs
that have been determined to be
safe and effective by experts
employed by or acting on behalf
of such entity and qualified by
scientific training and
experience to evaluate the
safety and effectiveness of
drugs on the basis of adequate
and well-controlled
investigations, including
clinical investigations,
conducted by experts qualified
by scientific training and
experience to evaluate the
safety and effectiveness of
drugs;
``(cc) that require the
methods used in, and the
facilities and controls used
for the manufacture,
processing, and packing of
drugs in the country to be
adequate to preserve their
identity, quality, purity, and
strength;
``(dd) for the reporting of
adverse reactions to drugs and
procedures to withdraw approval
and remove drugs found not to
be safe or effective; and
``(ee) that require the
labeling and promotion of drugs
to be in accordance with the
approval of the drug.
``(II) The valid marketing
authorization system in the country is
equivalent to the systems in the
countries described in clauses (i)
through (vi).
``(III) The importation of drugs to
the United States from the country will
not adversely affect public health.
``(b) Registration of Importers and Exporters.--
``(1) Registration of importers and exporters.--A
registration condition is that the importer or exporter
involved (referred to in this subsection as a `registrant')
submits to the Secretary a registration containing the
following:
``(A)(i) In the case of an exporter, the name of
the exporter and an identification of all places of
business of the exporter that relate to qualifying
drugs, including each warehouse or other facility owned
or controlled by, or operated for, the exporter.
``(ii) In the case of an importer, the name of the
importer and an identification of the places of
business of the importer at which the importer
initially receives a qualifying drug after importation
(which shall not exceed 3 places of business except by
permission of the Secretary).
``(B) Such information as the Secretary determines
to be necessary to demonstrate that the registrant is
in compliance with registration conditions under--
``(i) in the case of an importer,
subsections (c), (d), (e), (g), and (j)
(relating to the sources of imported qualifying
drugs; the inspection of facilities of the
importer; the payment of fees; compliance with
the standards referred to in section 801(a);
and maintenance of records and samples); or
``(ii) in the case of an exporter,
subsections (c), (d), (f), (g), (h), (i), and
(j) (relating to the sources of exported
qualifying drugs; the inspection of facilities
of the exporter and the marking of compliant
shipments; the payment of fees; and compliance
with the standards referred to in section
801(a); being licensed as a pharmacist;
conditions for individual importation; and
maintenance of records and samples).
``(C) An agreement by the registrant that the
registrant will not under subsection (a) import or
export any drug that is not a qualifying drug.
``(D) An agreement by the registrant to--
``(i) notify the Secretary of a recall or
withdrawal of a qualifying drug distributed in
a permitted country that the registrant has
exported or imported, or intends to export or
import, to the United States under subsection
(a);
``(ii) provide for the return to the
registrant of such drug; and
``(iii) cease, or not begin, the
exportation or importation of such drug unless
the Secretary has notified the registrant that
exportation or importation of such drug may
proceed.
``(E) An agreement by the registrant to ensure and
monitor compliance with each registration condition, to
promptly correct any noncompliance with such a
condition, and to promptly report to the Secretary any
such noncompliance.
``(F) A plan describing the manner in which the
registrant will comply with the agreement under
subparagraph (E).
``(G) An agreement by the registrant to enforce a
contract under subsection (c)(3)(B) against a party in
the chain of custody of a qualifying drug with respect
to the authority of the Secretary under clauses (ii)
and (iii) of that subsection.
``(H) An agreement by the registrant to notify the
Secretary not more than 30 days before the registrant
intends to make the change, of--
``(i) any change that the registrant
intends to make regarding information provided
under subparagraph (A) or (B); and
``(ii) any change that the registrant
intends to make in the compliance plan under
subparagraph (F).
``(I) In the case of an exporter:
``(i) An agreement by the exporter that a
qualifying drug will not under subsection (a)
be exported to any individual not authorized
pursuant to subsection (a)(2)(B) to be an
importer of such drug.
``(ii) An agreement to post a bond, payable
to the Treasury of the United States that is
equal in value to the lesser of--
``(I) the value of drugs exported
by the exporter to the United States in
a typical 4-week period over the course
of a year under this section; or
``(II) $1,000,000.
``(iii) An agreement by the exporter to
comply with applicable provisions of Canadian
law, or the law of the permitted country
designated under subsection (a)(4)(D)(i)(II) in
which the exporter is located, that protect the
privacy of personal information with respect to
each individual importing a prescription drug
from the exporter under subsection (a)(2)(B).
``(iv) An agreement by the exporter to
report to the Secretary--
``(I) not later than August 1 of
each fiscal year, the total price and
the total volume of drugs exported to
the United States by the exporter
during the 6-month period from January
1 through June 30 of that year; and
``(II) not later than January 1 of
each fiscal year, the total price and
the total volume of drugs exported to
the United States by the exporter
during the previous fiscal year.
``(J) In the case of an importer, an agreement by
the importer to report to the Secretary--
``(i) not later than August 1 of each
fiscal year, the total price and the total
volume of drugs imported to the United States
by the importer during the 6-month period from
January 1 through June 30 of that fiscal year;
and
``(ii) not later than January 1 of each
fiscal year, the total price and the total
volume of drugs imported to the United States
by the importer during the previous fiscal
year.
``(K) Such other provisions as the Secretary may
require by regulation to protect the public health
while permitting--
``(i) the importation by pharmacies, groups
of pharmacies, and wholesalers as registered
importers of qualifying drugs under subsection
(a); and
``(ii) importation by individuals of
qualifying drugs under subsection (a).
``(2) Approval or disapproval of registration.--
``(A) In general.--Not later than 90 days after the
date on which a registrant submits to the Secretary a
registration under paragraph (1), the Secretary shall
notify the registrant whether the registration is
approved or is disapproved. The Secretary shall
disapprove a registration if there is reason to believe
that the registrant is not in compliance with one or
more registration conditions, and shall notify the
registrant of such reason. In the case of a disapproved
registration, the Secretary shall subsequently notify
the registrant that the registration is approved if the
Secretary determines that the registrant is in
compliance with such conditions.
``(B) Changes in registration information.--Not
later than 30 days after receiving a notice under
paragraph (1)(H) from a registrant, the Secretary shall
determine whether the change involved affects the
approval of the registration of the registrant under
paragraph (1), and shall inform the registrant of the
determination.
``(3) Publication of contact information for registered
exporters.--Through the Internet website of the Food and Drug
Administration and a toll-free telephone number, the Secretary
shall make readily available to the public a list of registered
exporters, including contact information for the exporters.
Promptly after the approval of a registration submitted under
paragraph (1), the Secretary shall update the Internet website
and the information provided through the toll-free telephone
number accordingly.
``(4) Suspension and termination.--
``(A) Suspension.--With respect to the
effectiveness of a registration submitted under
paragraph (1):
``(i) Subject to clause (ii), the Secretary
may suspend the registration if the Secretary
determines, after notice and opportunity for a
hearing, that the registrant has failed to
maintain substantial compliance with a
registration condition.
``(ii) If the Secretary determines that,
under color of the registration, the exporter
has exported a drug or the importer has
imported a drug that is not a qualifying drug,
or a drug that does not comply with subsection
(g)(2)(A) or (g)(4), or has exported a
qualifying drug to an individual in violation
of subsection (i)(2)(F), the Secretary shall
immediately suspend the registration. A
suspension under the preceding sentence is not
subject to the provision by the Secretary of
prior notice, and the Secretary shall provide
to the registrant an opportunity for a hearing
not later than 10 days after the date on which
the registration is suspended.
``(iii) The Secretary may reinstate the
registration, whether suspended under clause
(i) or (ii), if the Secretary determines that
the registrant has demonstrated that further
violations of registration conditions will not
occur.
``(B) Termination.--The Secretary, after notice and
opportunity for a hearing, may terminate the
registration under paragraph (1) of a registrant if the
Secretary determines that the registrant has engaged in
a pattern or practice of violating 1 or more
registration conditions, or if on 1 or more occasions
the Secretary has under subparagraph (A)(ii) suspended
the registration of the registrant. The Secretary may
make the termination permanent, or for a fixed period
of not less than 1 year. During the period in which the
registration is terminated, any registration submitted
under paragraph (1) by the registrant, or a person that
is a partner in the export or import enterprise, or a
principal officer in such enterprise, and any
registration prepared with the assistance of the
registrant or such a person, has no legal effect under
this section.
``(5) Default of bond.--A bond required to be posted by an
exporter under paragraph (1)(I)(ii) shall be defaulted and paid
to the Treasury of the United States if, after opportunity for
an informal hearing, the Secretary determines that the exporter
has--
``(A) exported a drug to the United States that is
not a qualifying drug or that is not in compliance with
subsection (g)(2)(A), (g)(4), or (i); or
``(B) failed to permit the Secretary to conduct an
inspection described under subsection (d).
``(c) Sources of Qualifying Drugs.--A registration condition is
that the exporter or importer involved agrees that a qualifying drug
will under subsection (a) be exported or imported into the United
States only if there is compliance with the following:
``(1) The drug was manufactured in an establishment--
``(A) required to register under subsection (h) or
(i) of section 510; and
``(B)(i) inspected by the Secretary; or
``(ii) for which the Secretary has elected to rely
on a satisfactory report of a good manufacturing
practice inspection of the establishment from a
permitted country whose regulatory system the Secretary
recognizes as equivalent under a mutual recognition
agreement, as provided for under section 510(i)(3),
section 803, or part 26 of title 21, Code of Federal
Regulations (or any corresponding successor rule or
regulation).
``(2) The establishment is located in any country, and the
establishment manufactured the drug for distribution in the
United States or for distribution in 1 or more of the permitted
countries (without regard to whether in addition the drug is
manufactured for distribution in a foreign country that is not
a permitted country).
``(3) The exporter or importer obtained the drug--
``(A) directly from the establishment; or
``(B) directly from an entity that, by contract
with the exporter or importer--
``(i) provides to the exporter or importer
a statement (in such form and containing such
information as the Secretary may require) that,
for the chain of custody from the
establishment, identifies each prior sale,
purchase, or trade of the drug (including the
date of the transaction and the names and
addresses of all parties to the transaction);
``(ii) agrees to permit the Secretary to
inspect such statements and related records to
determine their accuracy;
``(iii) agrees, with respect to the
qualifying drugs involved, to permit the
Secretary to inspect warehouses and other
facilities, including records, of the entity
for purposes of determining whether the
facilities are in compliance with any standards
under this Act that are applicable to
facilities of that type in the United States;
and
``(iv) has ensured, through such
contractual relationships as may be necessary,
that the Secretary has the same authority
regarding other parties in the chain of custody
from the establishment that the Secretary has
under clauses (ii) and (iii) regarding such
entity.
``(4)(A) The foreign country from which the importer will
import the drug is a permitted country; or
``(B) The foreign country from which the exporter will
export the drug is the permitted country in which the exporter
is located.
``(5) During any period in which the drug was not in the
control of the manufacturer of the drug, the drug did not enter
any country that is not a permitted country.
``(6) The exporter or importer retains a sample of each lot
of the drug for testing by the Secretary.
``(d) Inspection of Facilities; Marking of Shipments.--
``(1) Inspection of facilities.--A registration condition
is that, for the purpose of assisting the Secretary in
determining whether the exporter involved is in compliance with
all other registration conditions--
``(A) the exporter agrees to permit the Secretary--
``(i) to conduct onsite inspections,
including monitoring on a day-to-day basis, of
places of business of the exporter that relate
to qualifying drugs, including each warehouse
or other facility owned or controlled by, or
operated for, the exporter;
``(ii) to have access, including on a day-
to-day basis, to--
``(I) records of the exporter that
relate to the export of such drugs,
including financial records; and
``(II) samples of such drugs;
``(iii) to carry out the duties described
in paragraph (3); and
``(iv) to carry out any other functions
determined by the Secretary to be necessary
regarding the compliance of the exporter; and
``(B) the Secretary has assigned 1 or more
employees of the Secretary to carry out the functions
described in this subsection for the Secretary
randomly, but not less than 12 times annually, on the
premises of places of businesses referred to in
subparagraph (A)(i), and such an assignment remains in
effect on a continuous basis.
``(2) Marking of compliant shipments.--A registration
condition is that the exporter involved agrees to affix to each
shipping container of qualifying drugs exported under
subsection (a) such markings as the Secretary determines to be
necessary to identify the shipment as being in compliance with
all registration conditions. Markings under the preceding
sentence shall--
``(A) be designed to prevent affixation of the
markings to any shipping container that is not
authorized to bear the markings; and
``(B) include anticounterfeiting or track-and-trace
technologies, taking into account the economic and
technical feasibility of those technologies.
``(3) Certain duties relating to exporters.--Duties of the
Secretary with respect to an exporter include the following:
``(A) Inspecting, randomly, but not less than 12
times annually, the places of business of the exporter
at which qualifying drugs are stored and from which
qualifying drugs are shipped.
``(B) During the inspections under subparagraph
(A), verifying the chain of custody of a statistically
significant sample of qualifying drugs from the
establishment in which the drug was manufactured to the
exporter, which shall be accomplished or supplemented
by the use of anticounterfeiting or track-and-trace
technologies, taking into account the economic and
technical feasibility of those technologies, except
that a drug that lacks such technologies from the point
of manufacture shall not for that reason be excluded
from importation by an exporter.
``(C) Randomly reviewing records of exports to
individuals for the purpose of determining whether the
drugs are being imported by the individuals in
accordance with the conditions under subsection (i).
Such reviews shall be conducted in a manner that will
result in a statistically significant determination of
compliance with all such conditions.
``(D) Monitoring the affixing of markings under
paragraph (2).
``(E) Inspecting as the Secretary determines is
necessary the warehouses and other facilities,
including records, of other parties in the chain of
custody of qualifying drugs.
``(F) Determining whether the exporter is in
compliance with all other registration conditions.
``(4) Prior notice of shipments.--A registration condition
is that, not less than 8 hours and not more than 5 days in
advance of the time of the importation of a shipment of
qualifying drugs, the importer involved agrees to submit to the
Secretary a notice with respect to the shipment of drugs to be
imported or offered for import into the United States under
subsection (a). A notice under the preceding sentence shall
include--
``(A) the name and complete contact information of
the person submitting the notice;
``(B) the name and complete contact information of
the importer involved;
``(C) the identity of the drug, including the
established name of the drug, the quantity of the drug,
and the lot number assigned by the manufacturer;
``(D) the identity of the manufacturer of the drug,
including the identity of the establishment at which
the drug was manufactured;
``(E) the country from which the drug is shipped;
``(F) the name and complete contact information for
the shipper of the drug;
``(G) anticipated arrival information, including
the port of arrival and crossing location within that
port, and the date and time;
``(H) a summary of the chain of custody of the drug
from the establishment in which the drug was
manufactured to the importer;
``(I) a declaration as to whether the Secretary has
ordered that importation of the drug from the permitted
country cease under subsection (g)(2)(C) or (D); and
``(J) such other information as the Secretary may
require by regulation.
``(5) Marking of compliant shipments.--A registration
condition is that the importer involved agrees, before
wholesale distribution (as defined in section 503(e)) of a
qualifying drug that has been imported under subsection (a), to
affix to each container of such drug such markings or other
technology as the Secretary determines necessary to identify
the shipment as being in compliance with all registration
conditions, except that the markings or other technology shall
not be required on a drug that bears comparable, compatible
markings or technology from the manufacturer of the drug.
Markings or other technology under the preceding sentence
shall--
``(A) be designed to prevent affixation of the
markings or other technology to any container that is
not authorized to bear the markings; and
``(B) shall include anticounterfeiting or track-
and-trace technologies, taking into account the
economic and technical feasibility of such
technologies.
``(6) Certain duties relating to importers.--Duties of the
Secretary with respect to an importer include the following:
``(A) Inspecting, randomly, but not less than 12
times annually, the places of business of the importer
at which a qualifying drug is initially received after
importation.
``(B) During the inspections under subparagraph
(A), verifying the chain of custody of a statistically
significant sample of qualifying drugs from the
establishment in which the drug was manufactured to the
importer, which shall be accomplished or supplemented
by the use of anticounterfeiting or track-and-trace
technologies, taking into account the economic and
technical feasibility of those technologies, except
that a drug that lacks such technologies from the point
of manufacture shall not for that reason be excluded
from importation by an importer.
``(C) Reviewing notices under paragraph (4).
``(D) Inspecting as the Secretary determines is
necessary the warehouses and other facilities,
including records of other parties in the chain of
custody of qualifying drugs.
``(E) Determining whether the importer is in
compliance with all other registration conditions.
``(e) Importer Fees.--
``(1) Registration fee.--A registration condition is that
the importer involved pays to the Secretary a fee of $10,000
due on the date on which the importer first submits the
registration to the Secretary under subsection (b).
``(2) Inspection fee.--A registration condition is that the
importer involved pays a fee to the Secretary in accordance
with this subsection. Such fee shall be paid not later than
October 1 and April 1 of each fiscal year in the amount
provided for under paragraph (3).
``(3) Amount of inspection fee.--
``(A) Aggregate total of fees.--Not later than 30
days before the start of each fiscal year, the
Secretary, in consultation with the Secretary of
Homeland Security and the Secretary of the Treasury,
shall establish an aggregate total of fees to be
collected under paragraph (2) for importers for that
fiscal year that is sufficient, and not more than
necessary, to pay the costs for that fiscal year of
administering this section with respect to registered
importers, including the costs associated with--
``(i) inspecting the facilities of
registered importers, and of other entities in
the chain of custody of a qualifying drug as
necessary, under subsection (d)(6);
``(ii) developing, implementing, and
operating under such subsection an electronic
system for submission and review of the notices
required under subsection (d)(4) with respect
to shipments of qualifying drugs under
subsection (a) to assess compliance with all
registration conditions when such shipments are
offered for import into the United States; and
``(iii) inspecting such shipments as
necessary, when offered for import into the
United States to determine if such a shipment
should be refused admission under subsection
(g)(5).
``(B) Limitation.--Subject to subparagraph (C), the
aggregate total of fees collected under paragraph (2)
for a fiscal year shall not exceed 2.5 percent of the
total price of qualifying drugs imported during that
fiscal year into the United States by registered
importers under subsection (a).
``(C) Total price of drugs.--
``(i) Estimate.--For the purposes of
complying with the limitation described in
subparagraph (B) when establishing under
subparagraph (A) the aggregate total of fees to
be collected under paragraph (2) for a fiscal
year, the Secretary shall estimate the total
price of qualifying drugs imported into the
United States by registered importers during
that fiscal year by adding the total price of
qualifying drugs imported by each registered
importer during the 6-month period from January
1 through June 30 of the previous fiscal year,
as reported to the Secretary by each registered
importer under subsection (b)(1)(J).
``(ii) Calculation.--Not later than March 1
of the fiscal year that follows the fiscal year
for which the estimate under clause (i) is
made, the Secretary shall calculate the total
price of qualifying drugs imported into the
United States by registered importers during
that fiscal year by adding the total price of
qualifying drugs imported by each registered
importer during that fiscal year, as reported
to the Secretary by each registered importer
under subsection (b)(1)(J).
``(iii) Adjustment.--If the total price of
qualifying drugs imported into the United
States by registered importers during a fiscal
year as calculated under clause (ii) is less
than the aggregate total of fees collected
under paragraph (2) for that fiscal year, the
Secretary shall provide for a pro-rata
reduction in the fee due from each registered
importer on April 1 of the subsequent fiscal
year so that the limitation described in
subparagraph (B) is observed.
``(D) Individual importer fee.--Subject to the
limitation described in subparagraph (B), the fee under
paragraph (2) to be paid on October 1 and April 1 by an
importer shall be an amount that is proportional to a
reasonable estimate by the Secretary of the semiannual
share of the importer of the volume of qualifying drugs
imported by importers under subsection (a).
``(4) Use of fees.--
``(A) In general.--Subject to appropriations Acts,
fees collected by the Secretary under paragraphs (1)
and (2) shall be credited to the appropriation account
for salaries and expenses of the Food and Drug
Administration until expended (without fiscal year
limitation), and the Secretary may, in consultation
with the Secretary of Homeland Security and the
Secretary of the Treasury, transfer some proportion of
such fees to the appropriation account for salaries and
expenses of the Bureau of Customs and Border Protection
until expended (without fiscal year limitation).
``(B) Sole purpose.--Fees collected by the
Secretary under paragraphs (1) and (2) are only
available to the Secretary and, if transferred, to the
Secretary of Homeland Security, and are for the sole
purpose of paying the costs referred to in paragraph
(3)(A).
``(5) Collection of fees.--In any case where the Secretary
does not receive payment of a fee assessed under paragraph (1)
or (2) within 30 days after it is due, such fee shall be
treated as a claim of the United States Government subject to
subchapter II of chapter 37 of title 31, United States Code.
``(f) Exporter Fees.--
``(1) Registration fee.--A registration condition is that
the exporter involved pays to the Secretary a fee of $10,000
due on the date on which the exporter first submits that
registration to the Secretary under subsection (b).
``(2) Inspection fee.--A registration condition is that the
exporter involved pays a fee to the Secretary in accordance
with this subsection. Such fee shall be paid not later than
October 1 and April 1 of each fiscal year in the amount
provided for under paragraph (3).
``(3) Amount of inspection fee.--
``(A) Aggregate total of fees.--Not later than 30
days before the start of each fiscal year, the
Secretary, in consultation with the Secretary of
Homeland Security and the Secretary of the Treasury,
shall establish an aggregate total of fees to be
collected under paragraph (2) for exporters for that
fiscal year that is sufficient, and not more than
necessary, to pay the costs for that fiscal year of
administering this section with respect to registered
exporters, including the costs associated with--
``(i) inspecting the facilities of
registered exporters, and of other entities in
the chain of custody of a qualifying drug as
necessary, under subsection (d)(3);
``(ii) developing, implementing, and
operating under such subsection a system to
screen marks on shipments of qualifying drugs
under subsection (a) that indicate compliance
with all registration conditions, when such
shipments are offered for import into the
United States; and
``(iii) screening such markings, and
inspecting such shipments as necessary, when
offered for import into the United States to
determine if such a shipment should be refused
admission under subsection (g)(5).
``(B) Limitation.--Subject to subparagraph (C), the
aggregate total of fees collected under paragraph (2)
for a fiscal year shall not exceed 2.5 percent of the
total price of qualifying drugs imported during that
fiscal year into the United States by registered
exporters under subsection (a).
``(C) Total price of drugs.--
``(i) Estimate.--For the purposes of
complying with the limitation described in
subparagraph (B) when establishing under
subparagraph (A) the aggregate total of fees to
be collected under paragraph (2) for a fiscal
year, the Secretary shall estimate the total
price of qualifying drugs imported into the
United States by registered exporters during
that fiscal year by adding the total price of
qualifying drugs exported by each registered
exporter during the 6-month period from January
1 through June 30 of the previous fiscal year,
as reported to the Secretary by each registered
exporter under subsection (b)(1)(I)(iv).
``(ii) Calculation.--Not later than March 1
of the fiscal year that follows the fiscal year
for which the estimate under clause (i) is
made, the Secretary shall calculate the total
price of qualifying drugs imported into the
United States by registered exporters during
that fiscal year by adding the total price of
qualifying drugs exported by each registered
exporter during that fiscal year, as reported
to the Secretary by each registered exporter
under subsection (b)(1)(I)(iv).
``(iii) Adjustment.--If the total price of
qualifying drugs imported into the United
States by registered exporters during a fiscal
year as calculated under clause (ii) is less
than the aggregate total of fees collected
under paragraph (2) for that fiscal year, the
Secretary shall provide for a pro-rata
reduction in the fee due from each registered
exporter on April 1 of the subsequent fiscal
year so that the limitation described in
subparagraph (B) is observed.
``(D) Individual exporter fee.--Subject to the
limitation described in subparagraph (B), the fee under
paragraph (2) to be paid on October 1 and April 1 by an
exporter shall be an amount that is proportional to a
reasonable estimate by the Secretary of the semiannual
share of the exporter of the volume of qualifying drugs
exported by exporters under subsection (a).
``(4) Use of fees.--
``(A) In general.--Subject to appropriations Acts,
fees collected by the Secretary under paragraphs (1)
and (2) shall be credited to the appropriation account
for salaries and expenses of the Food and Drug
Administration until expended (without fiscal year
limitation), and the Secretary may, in consultation
with the Secretary of Homeland Security and the
Secretary of the Treasury, transfer some proportion of
such fees to the appropriation account for salaries and
expenses of the Bureau of Customs and Border Protection
until expended (without fiscal year limitation).
``(B) Sole purpose.--Fees collected by the
Secretary under paragraphs (1) and (2) are only
available to the Secretary and, if transferred, to the
Secretary of Homeland Security, and are for the sole
purpose of paying the costs referred to in paragraph
(3)(A).
``(5) Collection of fees.--In any case where the Secretary
does not receive payment of a fee assessed under paragraph (1)
or (2) within 30 days after it is due, such fee shall be
treated as a claim of the United States Government subject to
subchapter II of chapter 37 of title 31, United States Code.
``(g) Compliance With Section 801(a).--
``(1) In general.--A registration condition is that each
qualifying drug exported under subsection (a) by the registered
exporter involved or imported under subsection (a) by the
registered importer involved is in compliance with the
standards referred to in section 801(a) regarding admission of
the drug into the United States, subject to paragraphs (2),
(3), and (4).
``(2) Section 505; approval status.--
``(A) In general.--A qualifying drug that is
imported or offered for import under subsection (a)
shall comply with the conditions established in the
approved application under section 505(b) for the U.S.
label drug as described under this subsection.
``(B) Notice by manufacturer; general provisions.--
``(i) In general.--The person that
manufactures a qualifying drug that is, or will
be, introduced for commercial distribution in a
permitted country shall in accordance with this
paragraph submit to the Secretary a notice
that--
``(I) includes each difference in
the qualifying drug from a condition
established in the approved application
for the U.S. label drug beyond--
``(aa) the variations
provided for in the
application; and
``(bb) any difference in
labeling (except ingredient
labeling); or
``(II) States that there is no
difference in the qualifying drug from
a condition established in the approved
application for the U.S. label drug
beyond--
``(aa) the variations
provided for in the
application; and
``(bb) any difference in
labeling (except ingredient
labeling).
``(ii) Information in notice.--A notice
under clause (i)(I) shall include the
information that the Secretary may require
under section 506A, any additional information
the Secretary may require (which may include
data on bioequivalence if such data are not
required under section 506A), and, with respect
to the permitted country that approved the
qualifying drug for commercial distribution, or
with respect to which such approval is sought,
include the following:
``(I) The date on which the
qualifying drug with such difference
was, or will be, introduced for
commercial distribution in the
permitted country.
``(II) Information demonstrating
that the person submitting the notice
has also notified the government of the
permitted country in writing that the
person is submitting to the Secretary a
notice under clause (i)(I), which
notice describes the difference in the
qualifying drug from a condition
established in the approved application
for the U.S. label drug.
``(III) The information that the
person submitted or will submit to the
government of the permitted country for
purposes of obtaining approval for
commercial distribution of the drug in
the country which, if in a language
other than English, shall be
accompanied by an English translation
verified to be complete and accurate,
with the name, address, and a brief
statement of the qualifications of the
person that made the translation.
``(iii) Certifications.--The chief
executive officer and the chief medical officer
of the manufacturer involved shall each certify
in the notice under clause (i) that--
``(I) the information provided in
the notice is complete and true; and
``(II) a copy of the notice has
been provided to the Federal Trade
Commission and to the State attorneys
general.
``(iv) Fee.--If a notice submitted under
clause (i) includes a difference that would,
under section 506A, require the submission of a
supplemental application if made as a change to
the U.S. label drug, the person that submits
the notice shall pay to the Secretary a fee in
the same amount as would apply if the person
were paying a fee pursuant to section
736(a)(1)(A)(ii). Subject to appropriations
Acts, fees collected by the Secretary under the
preceding sentence are available only to the
Secretary and are for the sole purpose of
paying the costs of reviewing notices submitted
under clause (i).
``(v) Timing of submission of notices.--
``(I) Prior approval notices.--A
notice under clause (i) to which
subparagraph (C) applies shall be
submitted to the Secretary not later
than 120 days before the qualifying
drug with the difference is introduced
for commercial distribution in a
permitted country, unless the country
requires that distribution of the
qualifying drug with the difference
begin less than 120 days after the
country requires the difference.
``(II) Other approval notices.--A
notice under clause (i) to which
subparagraph (D) applies shall be
submitted to the Secretary not later
than the day on which the qualifying
drug with the difference is introduced
for commercial distribution in a
permitted country.
``(III) Other notices.--A notice
under clause (i) to which subparagraph
(E) applies shall be submitted to the
Secretary on the date that the
qualifying drug is first introduced for
commercial distribution in a permitted
country and annually thereafter.
``(vi) Review by secretary.--
``(I) In general.--In this
paragraph, the difference in a
qualifying drug that is submitted in a
notice under clause (i) from the U.S.
label drug shall be treated by the
Secretary as if it were a manufacturing
change to the U.S. label drug under
section 506A.
``(II) Standard of review.--Except
as provided in subclause (III), the
Secretary shall review and approve or
disapprove the difference in a notice
submitted under clause (i), if required
under section 506A, using the safe and
effective standard for approving or
disapproving a manufacturing change
under section 506A.
``(III) Bioequivalence.--If the
Secretary would approve the difference
in a notice submitted under clause (i)
using the safe and effective standard
under section 506A and if the Secretary
determines that the qualifying drug is
not bioequivalent to the U.S. label
drug, the Secretary shall--
``(aa) include in the
labeling provided under
paragraph (3) a prominent
advisory that the qualifying
drug is safe and effective but
is not bioequivalent to the
U.S. label drug if the
Secretary determines that such
an advisory is necessary for
health care practitioners and
patients to use the qualifying
drug safely and effectively; or
``(bb) decline to approve
the difference if the Secretary
determines that the
availability of both the
qualifying drug and the U.S.
label drug would pose a threat
to the public health.
``(IV) Review by the secretary.--
The Secretary shall review and approve
or disapprove the difference in a
notice submitted under clause (i), if
required under section 506A, not later
than 120 days after the date on which
the notice is submitted.
``(V) Establishment inspection.--If
review of such difference would require
an inspection of the establishment in
which the qualifying drug is
manufactured--
``(aa) such inspection by
the Secretary shall be
authorized; and
``(bb) the Secretary may
rely on a satisfactory report
of a good manufacturing
practice inspection of the
establishment from a permitted
country whose regulatory system
the Secretary recognizes as
equivalent under a mutual
recognition agreement, as
provided under section
510(i)(3), section 803, or part
26 of title 21, Code of Federal
Regulations (or any
corresponding successor rule or
regulation).
``(vii) Publication of information on
notices.--
``(I) In general.--Through the
Internet website of the Food and Drug
Administration and a toll-free
telephone number, the Secretary shall
readily make available to the public a
list of notices submitted under clause
(i).
``(II) Contents.--The list under
subclause (I) shall include the date on
which a notice is submitted and
whether--
``(aa) a notice is under
review;
``(bb) the Secretary has
ordered that importation of the
qualifying drug from a
permitted country cease; or
``(cc) the importation of
the drug is permitted under
subsection (a).
``(III) Update.--The Secretary
shall promptly update the Internet
website with any changes to the list.
``(C) Notice; drug difference requiring prior
approval.--In the case of a notice under subparagraph
(B)(i) that includes a difference that would, under
section 506A(c) or (d)(3)(B)(i), require the approval
of a supplemental application before the difference
could be made to the U.S. label drug the following
shall occur:
``(i) Promptly after the notice is
submitted, the Secretary shall notify
registered exporters, registered importers, the
Federal Trade Commission, and the State
attorneys general that the notice has been
submitted with respect to the qualifying drug
involved.
``(ii) If the Secretary has not made a
determination whether such a supplemental
application regarding the U.S. label drug would
be approved or disapproved by the date on which
the qualifying drug involved is to be
introduced for commercial distribution in a
permitted country, the Secretary shall--
``(I) order that the importation of
the qualifying drug involved from the
permitted country not begin until the
Secretary completes review of the
notice; and
``(II) promptly notify registered
exporters, registered importers, the
Federal Trade Commission, and the State
attorneys general of the order.
``(iii) If the Secretary determines that
such a supplemental application regarding the
U.S. label drug would not be approved, the
Secretary shall--
``(I) order that the importation of
the qualifying drug involved from the
permitted country cease, or provide
that an order under clause (ii), if
any, remains in effect;
``(II) notify the permitted country
that approved the qualifying drug for
commercial distribution of the
determination; and
``(III) promptly notify registered
exporters, registered importers, the
Federal Trade Commission, and the State
attorneys general of the determination.
``(iv) If the Secretary determines that
such a supplemental application regarding the
U.S. label drug would be approved, the
Secretary shall--
``(I) vacate the order under clause
(ii), if any;
``(II) consider the difference to
be a variation provided for in the
approved application for the U.S. label
drug;
``(III) permit importation of the
qualifying drug under subsection (a);
and
``(IV) promptly notify registered
exporters, registered importers, the
Federal Trade Commission, and the State
attorneys general of the determination.
``(D) Notice; drug difference not requiring prior
approval.--In the case of a notice under subparagraph
(B)(i) that includes a difference that would, under
section 506A(d)(3)(B)(ii), not require the approval of
a supplemental application before the difference could
be made to the U.S. label drug the following shall
occur:
``(i) During the period in which the notice
is being reviewed by the Secretary, the
authority under this subsection to import the
qualifying drug involved continues in effect.
``(ii) If the Secretary determines that
such a supplemental application regarding the
U.S. label drug would not be approved, the
Secretary shall--
``(I) order that the importation of
the qualifying drug involved from the
permitted country cease;
``(II) notify the permitted country
that approved the qualifying drug for
commercial distribution of the
determination; and
``(III) promptly notify registered
exporters, registered importers, the
Federal Trade Commission, and the State
attorneys general of the determination.
``(iii) If the Secretary determines that
such a supplemental application regarding the
U.S. label drug would be approved, the
difference shall be considered to be a
variation provided for in the approved
application for the U.S. label drug.
``(E) Notice; drug difference not requiring
approval; no difference.--In the case of a notice under
subparagraph (B)(i) that includes a difference for
which, under section 506A(d)(1)(A), a supplemental
application would not be required for the difference to
be made to the U.S. label drug, or that States that
there is no difference, the Secretary--
``(i) shall consider such difference to be
a variation provided for in the approved
application for the U.S. label drug;
``(ii) may not order that the importation
of the qualifying drug involved cease; and
``(iii) shall promptly notify registered
exporters and registered importers.
``(F) Differences in active ingredient, route of
administration, dosage form, or strength.--
``(i) In general.--A person who
manufactures a drug approved under section
505(b) shall submit an application under
section 505(b) for approval of another drug
that is manufactured for distribution in a
permitted country by or for the person that
manufactures the drug approved under section
505(b) if--
``(I) there is no qualifying drug
in commercial distribution in permitted
countries whose combined population
represents at least 50 percent of the
total population of all permitted
countries with the same active
ingredient or ingredients, route of
administration, dosage form, and
strength as the drug approved under
section 505(b); and
``(II) each active ingredient of
the other drug is related to an active
ingredient of the drug approved under
section 505(b), as defined in clause
(v).
``(ii) Application under section 505(b).--
The application under section 505(b) required
under clause (i) shall--
``(I) request approval of the other
drug for the indication or indications
for which the drug approved under
section 505(b) is labeled;
``(II) include the information that
the person submitted to the government
of the permitted country for purposes
of obtaining approval for commercial
distribution of the other drug in that
country, which if in a language other
than English, shall be accompanied by
an English translation verified to be
complete and accurate, with the name,
address, and a brief statement of the
qualifications of the person that made
the translation;
``(III) include a right of
reference to the application for the
drug approved under section 505(b); and
``(IV) include such additional
information as the Secretary may
require.
``(iii) Timing of submission of
application.--An application under section
505(b) required under clause (i) shall be
submitted to the Secretary not later than the
day on which the information referred to in
clause (ii)(II) is submitted to the government
of the permitted country.
``(iv) Notice of decision on application.--
The Secretary shall promptly notify registered
exporters, registered importers, the Federal
Trade Commission, and the State attorneys
general of a determination to approve or to
disapprove an application under section 505(b)
required under clause (i).
``(v) Related active ingredients.--For
purposes of clause (i)(II), 2 active
ingredients are related if they are--
``(I) the same; or
``(II) different salts, esters, or
complexes of the same moiety.
``(3) Section 502; labeling.--
``(A) Importation by registered importer.--
``(i) In general.--In the case of a
qualifying drug that is imported or offered for
import by a registered importer, such drug
shall be considered to be in compliance with
section 502 and the labeling requirements under
the approved application for the U.S. label
drug if the qualifying drug bears--
``(I) a copy of the labeling
approved for the U.S. label drug under
section 505, without regard to whether
the copy bears any trademark involved;
``(II) the name of the manufacturer
and location of the manufacturer;
``(III) the lot number assigned by
the manufacturer;
``(IV) the name, location, and
registration number of the importer;
and
``(V) the National Drug Code number
assigned to the qualifying drug by the
Secretary.
``(ii) Request for copy of the labeling.--
The Secretary shall provide such copy to the
registered importer involved, upon request of
the importer.
``(iii) Requested labeling.--The labeling
provided by the Secretary under clause (ii)
shall--
``(I) include the established name,
as defined in section 502(e)(3), for
each active ingredient in the
qualifying drug;
``(II) not include the proprietary
name of the U.S. label drug or any
active ingredient thereof;
``(III) if required under paragraph
(2)(B)(vi)(III), a prominent advisory
that the qualifying drug is safe and
effective but not bioequivalent to the
U.S. label drug; and
``(IV) if the inactive ingredients
of the qualifying drug are different
from the inactive ingredients for the
U.S. label drug, include--
``(aa) a prominent notice
that the ingredients of the
qualifying drug differ from the
ingredients of the U.S. label
drug and that the qualifying
drug must be dispensed with an
advisory to people with
allergies about this difference
and a list of ingredients; and
``(bb) a list of the
ingredients of the qualifying
drug as would be required under
section 502(e).
``(B) Importation by individual.--
``(i) In general.--In the case of a
qualifying drug that is imported or offered for
import by a registered exporter to an
individual, such drug shall be considered to be
in compliance with section 502 and the labeling
requirements under the approved application for
the U.S. label drug if the packaging and
labeling of the qualifying drug complies with
all applicable regulations promulgated under
sections 3 and 4 of the Poison Prevention
Packaging Act of 1970 (15 U.S.C. 1471 et seq.)
and the labeling of the qualifying drug
includes--
``(I) directions for use by the
consumer;
``(II) the lot number assigned by
the manufacturer;
``(III) the name and registration
number of the exporter;
``(IV) if required under paragraph
(2)(B)(vi)(III), a prominent advisory
that the drug is safe and effective but
not bioequivalent to the U.S. label
drug;
``(V) if the inactive ingredients
of the drug are different from the
inactive ingredients for the U.S. label
drug--
``(aa) a prominent advisory
that persons with an allergy
should check the ingredient
list of the drug because the
ingredients of the drug differ
from the ingredients of the
U.S. label drug; and
``(bb) a list of the
ingredients of the drug as
would be required under section
502(e); and
``(VI) a copy of any special
labeling that would be required by the
Secretary had the U.S. label drug been
dispensed by a pharmacist in the United
States, without regard to whether the
special labeling bears any trademark
involved.
``(ii) Packaging.--A qualifying drug
offered for import to an individual by an
exporter under this section that is packaged in
a unit-of-use container (as those items are
defined in the United States Pharmacopeia and
National Formulary) shall not be repackaged,
provided that--
``(I) the packaging complies with
all applicable regulations under
sections 3 and 4 of the Poison
Prevention Packaging Act of 1970 (15
U.S.C. 1471 et seq.); or
``(II) the consumer consents to
waive the requirements of such Act,
after being informed that the packaging
does not comply with such Act and that
the exporter will provide the drug in
packaging that is compliant at no
additional cost.
``(iii) Request for copy of special
labeling and ingredient list.--The Secretary
shall provide to the registered exporter
involved a copy of the special labeling, the
advisory, and the ingredient list described
under clause (i), upon request of the exporter.
``(iv) Requested labeling and ingredient
list.--The labeling and ingredient list
provided by the Secretary under clause (iii)
shall--
``(I) include the established name,
as defined in section 502(e)(3), for
each active ingredient in the drug; and
``(II) not include the proprietary
name of the U.S. label drug or any
active ingredient thereof.
``(4) Section 501; adulteration.--A qualifying drug that is
imported or offered for import under subsection (a) shall be
considered to be in compliance with section 501 if the drug is
in compliance with subsection (c).
``(5) Standards for refusing admission.--A drug exported
under subsection (a) from a registered exporter or imported by
a registered importer may be refused admission into the United
States if 1 or more of the following applies:
``(A) The drug is not a qualifying drug.
``(B) A notice for the drug required under
paragraph (2)(B) has not been submitted to the
Secretary.
``(C) The Secretary has ordered that importation of
the drug from the permitted country cease under
paragraph (2) (C) or (D).
``(D) The drug does not comply with paragraph (3)
or (4).
``(E) The shipping container appears damaged in a
way that may affect the strength, quality, or purity of
the drug.
``(F) The Secretary becomes aware that--
``(i) the drug may be counterfeit;
``(ii) the drug may have been prepared,
packed, or held under insanitary conditions; or
``(iii) the methods used in, or the
facilities or controls used for, the
manufacturing, processing, packing, or holding
of the drug do not conform to good
manufacturing practice.
``(G) The Secretary has obtained an injunction
under section 302 that prohibits the distribution of
the drug in interstate commerce.
``(H) The Secretary has under section 505(e)
withdrawn approval of the drug.
``(I) The manufacturer of the drug has instituted a
recall of the drug.
``(J) If the drug is imported or offered for import
by a registered importer without submission of a notice
in accordance with subsection (d)(4).
``(K) If the drug is imported or offered for import
from a registered exporter to an individual and 1 or
more of the following applies:
``(i) The shipping container for such drug
does not bear the markings required under
subsection (d)(2).
``(ii) The markings on the shipping
container appear to be counterfeit.
``(iii) The shipping container or markings
appear to have been tampered with.
``(h) Exporter Licensure in Permitted Country.--A registration
condition is that the exporter involved agrees that a qualifying drug
will be exported to an individual only if the Secretary has verified
that--
``(1) the exporter is authorized under the law of the
permitted country in which the exporter is located to dispense
prescription drugs; and
``(2) the exporter employs persons that are licensed under
the law of the permitted country in which the exporter is
located to dispense prescription drugs in sufficient number to
dispense safely the drugs exported by the exporter to
individuals, and the exporter assigns to those persons
responsibility for dispensing such drugs to individuals.
``(i) Individuals; Conditions for Importation.--
``(1) In general.--For purposes of subsection (a)(2)(B),
the importation of a qualifying drug by an individual is in
accordance with this subsection if the following conditions are
met:
``(A) The drug is accompanied by a copy of a
prescription for the drug, which prescription--
``(i) is valid under applicable Federal and
State laws; and
``(ii) was issued by a practitioner who,
under the law of a State of which the
individual is a resident, or in which the
individual receives care from the practitioner
who issues the prescription, is authorized to
administer prescription drugs.
``(B) The drug is accompanied by a copy of the
documentation that was required under the law or
regulations of the permitted country in which the
exporter is located, as a condition of dispensing the
drug to the individual.
``(C) The copies referred to in subparagraphs
(A)(i) and (B) are marked in a manner sufficient--
``(i) to indicate that the prescription,
and the equivalent document in the permitted
country in which the exporter is located, have
been filled; and
``(ii) to prevent a duplicative filling by
another pharmacist.
``(D) The individual has provided to the registered
exporter a complete list of all drugs used by the
individual for review by the individuals who dispense
the drug.
``(E) The quantity of the drug does not exceed a
90-day supply.
``(F) The drug is not an ineligible subpart H drug.
For purposes of this section, a prescription drug is an
`ineligible subpart H drug' if the drug was approved by
the Secretary under subpart H of part 314 of title 21,
Code of Federal Regulations (relating to accelerated
approval), with restrictions under section 520 of such
part to assure safe use, and the Secretary has
published in the Federal Register a notice that the
Secretary has determined that good cause exists to
prohibit the drug from being imported pursuant to this
subsection.
``(2) Notice regarding drug refused admission.--If a
registered exporter ships a drug to an individual pursuant to
subsection (a)(2)(B) and the drug is refused admission to the
United States, a written notice shall be sent to the individual
and to the exporter that informs the individual and the
exporter of such refusal and the reason for the refusal.
``(j) Maintenance of Records and Samples.--
``(1) In general.--A registration condition is that the
importer or exporter involved shall--
``(A) maintain records required under this section
for not less than 2 years; and
``(B) maintain samples of each lot of a qualifying
drug required under this section for not more than 2
years.
``(2) Place of record maintenance.--The records described
under paragraph (1) shall be maintained--
``(A) in the case of an importer, at the place of
business of the importer at which the importer
initially receives the qualifying drug after
importation; or
``(B) in the case of an exporter, at the facility
from which the exporter ships the qualifying drug to
the United States.
``(k) Drug Recalls.--
``(1) Manufacturers.--A person that manufactures a
qualifying drug imported from a permitted country under this
section shall promptly inform the Secretary--
``(A) if the drug is recalled or withdrawn from the
market in a permitted country;
``(B) how the drug may be identified, including lot
number; and
``(C) the reason for the recall or withdrawal.
``(2) Secretary.--With respect to each permitted country,
the Secretary shall--
``(A) enter into an agreement with the government
of the country to receive information about recalls and
withdrawals of qualifying drugs in the country; or
``(B) monitor recalls and withdrawals of qualifying
drugs in the country using any information that is
available to the public in any media.
``(3) Notice.--The Secretary may notify, as appropriate,
registered exporters, registered importers, wholesalers,
pharmacies, or the public of a recall or withdrawal of a
qualifying drug in a permitted country.
``(l) Drug Labeling and Packaging.--
``(1) In general.--When a qualifying drug that is imported
into the United States by an importer under subsection (a) is
dispensed by a pharmacist to an individual, the pharmacist
shall provide that the packaging and labeling of the drug
complies with all applicable regulations promulgated under
sections 3 and 4 of the Poison Prevention Packaging Act of 1970
(15 U.S.C. 1471 et seq.) and shall include with any other
labeling provided to the individual the following:
``(A) The lot number assigned by the manufacturer.
``(B) The name and registration number of the
importer.
``(C) If required under paragraph (2)(B)(vi)(III)
of subsection (g), a prominent advisory that the drug
is safe and effective but not bioequivalent to the U.S.
label drug.
``(D) If the inactive ingredients of the drug are
different from the inactive ingredients for the U.S.
label drug--
``(i) a prominent advisory that persons
with allergies should check the ingredient list
of the drug because the ingredients of the drug
differ from the ingredients of the U.S. label
drug; and
``(ii) a list of the ingredients of the
drug as would be required under section 502(e).
``(2) Packaging.--A qualifying drug that is packaged in a
unit-of-use container (as those terms are defined in the United
States Pharmacopeia and National Formulary) shall not be
repackaged, provided that--
``(A) the packaging complies with all applicable
regulations under sections 3 and 4 of the Poison
Prevention Packaging Act of 1970 (15 U.S.C. 1471 et
seq.); or
``(B) the consumer consents to waive the
requirements of such Act, after being informed that the
packaging does not comply with such Act and that the
pharmacist will provide the drug in packaging that is
compliant at no additional cost.
``(m) Charitable Contributions.--Notwithstanding any other
provision of this section, this section does not authorize the
importation into the United States of a qualifying drug donated or
otherwise supplied for free or at nominal cost by the manufacturer of
the drug to a charitable or humanitarian organization, including the
United Nations and affiliates, or to a government of a foreign country.
``(n) Unfair and Discriminatory Acts and Practices.--
``(1) In general.--It is unlawful for a manufacturer,
directly or indirectly (including by being a party to a
licensing agreement or other agreement), to--
``(A) discriminate by charging a higher price for a
prescription drug sold to a registered exporter or
other person in a permitted country that exports a
qualifying drug to the United States under this section
than the price that is charged, inclusive of rebates or
other incentives to the permitted country or other
person, to another person that is in the same country
and that does not export a qualifying drug into the
United States under this section;
``(B) discriminate by charging a higher price for a
prescription drug sold to a registered importer or
other person that distributes, sells, or uses a
qualifying drug imported into the United States under
this section than the price that is charged to another
person in the United States that does not import a
qualifying drug under this section, or that does not
distribute, sell, or use such a drug;
``(C) discriminate by denying, restricting, or
delaying supplies of a prescription drug to a
registered exporter or other person in a permitted
country that exports a qualifying drug to the United
States under this section or to a registered importer
or other person that distributes, sells, or uses a
qualifying drug imported into the United States under
this section;
``(D) discriminate by publicly, privately, or
otherwise refusing to do business with a registered
exporter or other person in a permitted country that
exports a qualifying drug to the United States under
this section or with a registered importer or other
person that distributes, sells, or uses a qualifying
drug imported into the United States under this
section;
``(E) knowingly fail to submit a notice under
subsection (g)(2)(B)(i), knowingly fail to submit such
a notice on or before the date specified in subsection
(g)(2)(B)(v) or as otherwise required under subsection
(e) (3), (4), and (5) of section 4 of the
Pharmaceutical Market Access and Drug Safety Act of
2009, knowingly submit such a notice that makes a
materially false, fictitious, or fraudulent statement,
or knowingly fail to provide promptly any information
requested by the Secretary to review such a notice;
``(F) knowingly fail to submit an application
required under subsection (g)(2)(F), knowingly fail to
submit such an application on or before the date
specified in subsection (g)(2)(F)(ii), knowingly submit
such an application that makes a materially false,
fictitious, or fraudulent statement, or knowingly fail
to provide promptly any information requested by the
Secretary to review such an application;
``(G) cause there to be a difference (including a
difference in active ingredient, route of
administration, dosage form, strength, formulation,
manufacturing establishment, manufacturing process, or
person that manufactures the drug) between a
prescription drug for distribution in the United States
and the drug for distribution in a permitted country;
``(H) refuse to allow an inspection authorized
under this section of an establishment that
manufactures a qualifying drug that is, or will be,
introduced for commercial distribution in a permitted
country;
``(I) fail to conform to the methods used in, or
the facilities used for, the manufacturing, processing,
packing, or holding of a qualifying drug that is, or
will be, introduced for commercial distribution in a
permitted country to good manufacturing practice under
this Act;
``(J) become a party to a licensing agreement or
other agreement related to a qualifying drug that fails
to provide for compliance with all requirements of this
section with respect to such drug;
``(K) enter into a contract that restricts,
prohibits, or delays the importation of a qualifying
drug under this section;
``(L) engage in any other action to restrict,
prohibit, or delay the importation of a qualifying drug
under this section; or
``(M) engage in any other action that the Federal
Trade Commission determines to discriminate against a
person that engages or attempts to engage in the
importation of a qualifying drug under this section.
``(2) Referral of potential violations.--The Secretary
shall promptly refer to the Federal Trade Commission each
potential violation of subparagraph (E), (F), (G), (H), or (I)
of paragraph (1) that becomes known to the Secretary.
``(3) Affirmative defense.--
``(A) Discrimination.--It shall be an affirmative
defense to a charge that a manufacturer has
discriminated under subparagraph (A), (B), (C), (D), or
(M) of paragraph (1) that the higher price charged for
a prescription drug sold to a person, the denial,
restriction, or delay of supplies of a prescription
drug to a person, the refusal to do business with a
person, or other discriminatory activity against a
person, is not based, in whole or in part, on--
``(i) the person exporting or importing a
qualifying drug into the United States under
this section; or
``(ii) the person distributing, selling, or
using a qualifying drug imported into the
United States under this section.
``(B) Drug differences.--It shall be an affirmative
defense to a charge that a manufacturer has caused
there to be a difference described in subparagraph (G)
of paragraph (1) that--
``(i) the difference was required by the
country in which the drug is distributed;
``(ii) the Secretary has determined that
the difference was necessary to improve the
safety or effectiveness of the drug;
``(iii) the person manufacturing the drug
for distribution in the United States has given
notice to the Secretary under subsection
(g)(2)(B)(i) that the drug for distribution in
the United States is not different from a drug
for distribution in permitted countries whose
combined population represents at least 50
percent of the total population of all
permitted countries; or
``(iv) the difference was not caused, in
whole or in part, for the purpose of
restricting importation of the drug into the
United States under this section.
``(4) Effect of subsection.--
``(A) Sales in other countries.--This subsection
applies only to the sale or distribution of a
prescription drug in a country if the manufacturer of
the drug chooses to sell or distribute the drug in the
country. Nothing in this subsection shall be construed
to compel the manufacturer of a drug to distribute or
sell the drug in a country.
``(B) Discounts to insurers, health plans, pharmacy
benefit managers, and covered entities.--Nothing in
this subsection shall be construed to--
``(i) prevent or restrict a manufacturer of
a prescription drug from providing discounts to
an insurer, health plan, pharmacy benefit
manager in the United States, or covered entity
in the drug discount program under section 340B
of the Public Health Service Act (42 U.S.C.
256b) in return for inclusion of the drug on a
formulary;
``(ii) require that such discounts be made
available to other purchasers of the
prescription drug; or
``(iii) prevent or restrict any other
measures taken by an insurer, health plan, or
pharmacy benefit manager to encourage
consumption of such prescription drug.
``(C) Charitable contributions.--Nothing in this
subsection shall be construed to--
``(i) prevent a manufacturer from donating
a prescription drug, or supplying a
prescription drug at nominal cost, to a
charitable or humanitarian organization,
including the United Nations and affiliates, or
to a government of a foreign country; or
``(ii) apply to such donations or supplying
of a prescription drug.
``(5) Enforcement.--
``(A) Unfair or deceptive act or practice.--A
violation of this subsection shall be treated as a
violation of a rule defining an unfair or deceptive act
or practice prescribed under section 18(a)(1)(B) of the
Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)).
``(B) Actions by the commission.--The Federal Trade
Commission--
``(i) shall enforce this subsection in the
same manner, by the same means, and with the
same jurisdiction, powers, and duties as though
all applicable terms and provisions of the
Federal Trade Commission Act (15 U.S.C. 41 et
seq.) were incorporated into and made a part of
this section; and
``(ii) may seek monetary relief threefold
the damages sustained, in addition to any other
remedy available to the Federal Trade
Commission under the Federal Trade Commission
Act (15 U.S.C. 41 et seq.).
``(6) Actions by states.--
``(A) In general.--
``(i) Civil actions.--In any case in which
the attorney general of a State has reason to
believe that an interest of the residents of
that State have been adversely affected by any
manufacturer that violates paragraph (1), the
attorney general of a State may bring a civil
action on behalf of the residents of the State,
and persons doing business in the State, in a
district court of the United States of
appropriate jurisdiction to--
``(I) enjoin that practice;
``(II) enforce compliance with this
subsection;
``(III) obtain damages,
restitution, or other compensation on
behalf of residents of the State and
persons doing business in the State,
including threefold the damages; or
``(IV) obtain such other relief as
the court may consider to be
appropriate.
``(ii) Notice.--
``(I) In general.--Before filing an
action under clause (i), the attorney
general of the State involved shall
provide to the Federal Trade
Commission--
``(aa) written notice of
that action; and
``(bb) a copy of the
complaint for that action.
``(II) Exemption.--Subclause (I)
shall not apply with respect to the
filing of an action by an attorney
general of a State under this
paragraph, if the attorney general
determines that it is not feasible to
provide the notice described in that
subclause before filing of the action.
In such case, the attorney general of a
State shall provide notice and a copy
of the complaint to the Federal Trade
Commission at the same time as the
attorney general files the action.
``(B) Intervention.--
``(i) In general.--On receiving notice
under subparagraph (A)(ii), the Federal Trade
Commission shall have the right to intervene in
the action that is the subject of the notice.
``(ii) Effect of intervention.--If the
Federal Trade Commission intervenes in an
action under subparagraph (A), it shall have
the right--
``(I) to be heard with respect to
any matter that arises in that action;
and
``(II) to file a petition for
appeal.
``(C) Construction.--For purposes of bringing any
civil action under subparagraph (A), nothing in this
subsection shall be construed to prevent an attorney
general of a State from exercising the powers conferred
on the attorney general by the laws of that State to--
``(i) conduct investigations;
``(ii) administer oaths or affirmations; or
``(iii) compel the attendance of witnesses
or the production of documentary and other
evidence.
``(D) Actions by the commission.--In any case in
which an action is instituted by or on behalf of the
Federal Trade Commission for a violation of paragraph
(1), a State may not, during the pendency of that
action, institute an action under subparagraph (A) for
the same violation against any defendant named in the
complaint in that action.
``(E) Venue.--Any action brought under subparagraph
(A) may be brought in the district court of the United
States that meets applicable requirements relating to
venue under section 1391 of title 28, United States
Code.
``(F) Service of process.--In an action brought
under subparagraph (A), process may be served in any
district in which the defendant--
``(i) is an inhabitant; or
``(ii) may be found.
``(G) Measurement of damages.--In any action under
this paragraph to enforce a cause of action under this
subsection in which there has been a determination that
a defendant has violated a provision of this
subsection, damages may be proved and assessed in the
aggregate by statistical or sampling methods, by the
computation of illegal overcharges or by such other
reasonable system of estimating aggregate damages as
the court in its discretion may permit without the
necessity of separately proving the individual claim
of, or amount of damage to, persons on whose behalf the
suit was brought.
``(H) Exclusion on duplicative relief.--The
district court shall exclude from the amount of
monetary relief awarded in an action under this
paragraph brought by the attorney general of a State
any amount of monetary relief which duplicates amounts
which have been awarded for the same injury.
``(7) Effect on antitrust laws.--Nothing in this subsection
shall be construed to modify, impair, or supersede the
operation of the antitrust laws. For the purpose of this
subsection, the term `antitrust laws' has the meaning given it
in the first section of the Clayton Act, except that it
includes section 5 of the Federal Trade Commission Act to the
extent that such section 5 applies to unfair methods of
competition.
``(8) Manufacturer.--In this subsection, the term
`manufacturer' means any entity, including any affiliate or
licensee of that entity, that is engaged in--
``(A) the production, preparation, propagation,
compounding, conversion, or processing of a
prescription drug, either directly or indirectly by
extraction from substances of natural origin, or
independently by means of chemical synthesis, or by a
combination of extraction and chemical synthesis; or
``(B) the packaging, repackaging, labeling,
relabeling, or distribution of a prescription drug.''.
(b) Prohibited Acts.--The Federal Food, Drug, and Cosmetic Act is
amended--
(1) in section 301 (21 U.S.C. 331), by striking paragraph
(aa) and inserting the following:
``(aa)(1) The sale or trade by a pharmacist, or by a business
organization of which the pharmacist is a part, of a qualifying drug
that under section 804(a)(2)(A) was imported by the pharmacist, other
than--
``(A) a sale at retail made pursuant to dispensing the drug
to a customer of the pharmacist or organization; or
``(B) a sale or trade of the drug to a pharmacy or a
wholesaler registered to import drugs under section 804.
``(2) The sale or trade by an individual of a qualifying drug that
under section 804(a)(2)(B) was imported by the individual.
``(3) The making of a materially false, fictitious, or fraudulent
statement or representation, or a material omission, in a notice under
clause (i) of section 804(g)(2)(B) or in an application required under
section 804(g)(2)(F), or the failure to submit such a notice or
application.
``(4) The importation of a drug in violation of a registration
condition or other requirement under section 804, the falsification of
any record required to be maintained, or provided to the Secretary,
under such section, or the violation of any registration condition or
other requirement under such section.''; and
(2) in section 303(a) (21 U.S.C. 333(a)), by striking
paragraph (6) and inserting the following:
``(6) Notwithstanding subsection (a), any person that knowingly
violates section 301(i) (2) or (3) or section 301(aa)(4) shall be
imprisoned not more than 10 years, or fined in accordance with title
18, United States Code, or both.''.
(c) Amendment of Certain Provisions.--
(1) In general.--Section 801 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 381) is amended by striking subsection
(g) and inserting the following:
``(g) With respect to a prescription drug that is imported or
offered for import into the United States by an individual who is not
in the business of such importation, that is not shipped by a
registered exporter under section 804, and that is refused admission
under subsection (a), the Secretary shall notify the individual that--
``(1) the drug has been refused admission because the drug
was not a lawful import under section 804;
``(2) the drug is not otherwise subject to a waiver of the
requirements of subsection (a);
``(3) the individual may under section 804 lawfully import
certain prescription drugs from exporters registered with the
Secretary under section 804; and
``(4) the individual can find information about such
importation, including a list of registered exporters, on the
Internet website of the Food and Drug Administration or through
a toll-free telephone number required under section 804.''.
(2) Establishment registration.--Section 510(i) of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360(i)) is
amended in paragraph (1) by inserting after ``import into the
United States'' the following: ``, including a drug that is, or
may be, imported or offered for import into the United States
under section 804,''.
(3) Effective date.--The amendments made by this subsection
shall take effect on the date that is 90 days after the date of
enactment of this Act.
(d) Exhaustion.--
(1) In general.--Section 271 of title 35, United States
Code, is amended--
(A) by redesignating subsections (h) and (i) as (i)
and (j), respectively; and
(B) by inserting after subsection (g) the
following:
``(h) It shall not be an act of infringement to use, offer to sell,
or sell within the United States or to import into the United States
any patented invention under section 804 of the Federal Food, Drug, and
Cosmetic Act that was first sold abroad by or under authority of the
owner or licensee of such patent.''.
(2) Rule of construction.--Nothing in the amendment made by
paragraph (1) shall be construed to affect the ability of a
patent owner or licensee to enforce their patent, subject to
such amendment.
(e) Effect of Section 804.--
(1) In general.--Section 804 of the Federal Food, Drug, and
Cosmetic Act, as added by subsection (a), shall permit the
importation of qualifying drugs (as defined in such section
804) into the United States without regard to the status of the
issuance of implementing regulations--
(A) from exporters registered under such section
804 on the date that is 90 days after the date of
enactment of this Act; and
(B) from permitted countries, as defined in such
section 804, by importers registered under such section
804 on the date that is 1 year after the date of
enactment of this Act.
(2) Review of registration by certain exporters.--
(A) Review priority.--In the review of
registrations submitted under subsection (b) of such
section 804, registrations submitted by entities in
Canada that are significant exporters of prescription
drugs to individuals in the United States as of the
date of enactment of this Act will have priority during
the 90-day period that begins on such date of
enactment.
(B) Period for review.--During such 90-day period,
the reference in subsection (b)(2)(A) of such section
804 to 90 days (relating to approval or disapproval of
registrations) is, as applied to such entities, deemed
to be 30 days.
(C) Limitation.--That an exporter in Canada
exports, or has exported, prescription drugs to
individuals in the United States on or before the date
that is 90 days after the date of enactment of this Act
shall not serve as a basis, in whole or in part, for
disapproving a registration under such section 804 from
the exporter.
(D) First year limit on number of exporters.--
During the 1-year period beginning on the date of
enactment of this Act, the Secretary of Health and
Human Services (referred to in this section as the
``Secretary'') may limit the number of registered
exporters under such section 804 to not less than 50,
so long as the Secretary gives priority to those
exporters with demonstrated ability to process a high
volume of shipments of drugs to individuals in the
United States.
(E) Second year limit on number of exporters.--
During the 1-year period beginning on the date that is
1 year after the date of enactment of this Act, the
Secretary may limit the number of registered exporters
under such section 804 to not less than 100, so long as
the Secretary gives priority to those exporters with
demonstrated ability to process a high volume of
shipments of drugs to individuals in the United States.
(F) Further limit on number of exporters.--During
any 1-year period beginning on a date that is 2 or more
years after the date of enactment of this Act, the
Secretary may limit the number of registered exporters
under such section 804 to not less than 25 more than
the number of such exporters during the previous 1-year
period, so long as the Secretary gives priority to
those exporters with demonstrated ability to process a
high volume of shipments of drugs to individuals in the
United States.
(3) Limits on number of importers.--
(A) First year limit on number of importers.--
During the 1-year period beginning on the date that is
1 year after the date of enactment of this Act, the
Secretary may limit the number of registered importers
under such section 804 to not less than 100 (of which
at least a significant number shall be groups of
pharmacies, to the extent feasible given the
applications submitted by such groups), so long as the
Secretary gives priority to those importers with
demonstrated ability to process a high volume of
shipments of drugs imported into the United States.
(B) Second year limit on number of importers.--
During the 1-year period beginning on the date that is
2 years after the date of enactment of this Act, the
Secretary may limit the number of registered importers
under such section 804 to not less than 200 (of which
at least a significant number shall be groups of
pharmacies, to the extent feasible given the
applications submitted by such groups), so long as the
Secretary gives priority to those importers with
demonstrated ability to process a high volume of
shipments of drugs into the United States.
(C) Further limit on number of importers.--During
any 1-year period beginning on a date that is 3 or more
years after the date of enactment of this Act, the
Secretary may limit the number of registered importers
under such section 804 to not less than 50 more (of
which at least a significant number shall be groups of
pharmacies, to the extent feasible given the
applications submitted by such groups) than the number
of such importers during the previous 1-year period, so
long as the Secretary gives priority to those importers
with demonstrated ability to process a high volume of
shipments of drugs to the United States.
(4) Notices for drugs for import from canada.--The notice
with respect to a qualifying drug introduced for commercial
distribution in Canada as of the date of enactment of this Act
that is required under subsection (g)(2)(B)(i) of such section
804 shall be submitted to the Secretary not later than 30 days
after the date of enactment of this Act if--
(A) the U.S. label drug (as defined in such section
804) for the qualifying drug is 1 of the 100
prescription drugs with the highest dollar volume of
sales in the United States based on the 12 calendar
month period most recently completed before the date of
enactment of this Act; or
(B) the notice is a notice under subsection
(g)(2)(B)(i)(II) of such section 804.
(5) Notice for drugs for import from other countries.--The
notice with respect to a qualifying drug introduced for
commercial distribution in a permitted country other than
Canada as of the date of enactment of this Act that is required
under subsection (g)(2)(B)(i) of such section 804 shall be
submitted to the Secretary not later than 180 days after the
date of enactment of this Act if--
(A) the U.S. label drug for the qualifying drug is
1 of the 100 prescription drugs with the highest dollar
volume of sales in the United States based on the 12
calendar month period that is first completed on the
date that is 120 days after the date of enactment of
this Act; or
(B) the notice is a notice under subsection
(g)(2)(B)(i)(II) of such section 804.
(6) Notice for other drugs for import.--
(A) Guidance on submission dates.--The Secretary
shall by guidance establish a series of submission
dates for the notices under subsection (g)(2)(B)(i) of
such section 804 with respect to qualifying drugs
introduced for commercial distribution as of the date
of enactment of this Act and that are not required to
be submitted under paragraph (4) or (5).
(B) Consistent and efficient use of resources.--The
Secretary shall establish the dates described under
subparagraph (A) so that such notices described under
subparagraph (A) are submitted and reviewed at a rate
that allows consistent and efficient use of the
resources and staff available to the Secretary for such
reviews. The Secretary may condition the requirement to
submit such a notice, and the review of such a notice,
on the submission by a registered exporter or a
registered importer to the Secretary of a notice that
such exporter or importer intends to import such
qualifying drug to the United States under such section
804.
(C) Priority for drugs with higher sales.--The
Secretary shall establish the dates described under
subparagraph (A) so that the Secretary reviews the
notices described under such subparagraph with respect
to qualifying drugs with higher dollar volume of sales
in the United States before the notices with respect to
drugs with lower sales in the United States.
(7) Notices for drugs approved after effective date.--The
notice required under subsection (g)(2)(B)(i) of such section
804 for a qualifying drug first introduced for commercial
distribution in a permitted country (as defined in such section
804) after the date of enactment of this Act shall be submitted
to and reviewed by the Secretary as provided under subsection
(g)(2)(B) of such section 804, without regard to paragraph (4),
(5), or (6).
(8) Report.--Beginning with the first full fiscal year
after the date of enactment of this Act, not later than 90 days
after the end of each fiscal year during which the Secretary
reviews a notice referred to in paragraph (4), (5), or (6), the
Secretary shall submit a report to Congress concerning the
progress of the Food and Drug Administration in reviewing the
notices referred to in paragraphs (4), (5), and (6).
(9) User fees.--
(A) Exporters.--When establishing an aggregate
total of fees to be collected from exporters under
subsection (f)(2) of such section 804, the Secretary
shall, under subsection (f)(3)(C)(i) of such section
804, estimate the total price of drugs imported under
subsection (a) of such section 804 into the United
States by registered exporters during the first fiscal
year in which this Act takes effect to be an amount
equal to the amount which bears the same ratio to
$1,000,000,000 as the number of days in such fiscal
year during which this Act is effective bears to 365.
(B) Importers.--When establishing an aggregate
total of fees to be collected from importers under
subsection (e)(2) of such section 804, the Secretary
shall, under subsection (e)(3)(C)(i) of such section
804, estimate the total price of drugs imported under
subsection (a) of such section 804 into the United
States by registered importers during--
(i) the first fiscal year in which this Act
takes effect to be an amount equal to the
amount which bears the same ratio to
$1,000,000,000 as the number of days in such
fiscal year during which this Act is effective
bears to 365; and
(ii) the second fiscal year in which this
Act is in effect to be $3,000,000,000.
(C) Second year adjustment.--
(i) Reports.--Not later than February 20 of
the second fiscal year in which this Act is in
effect, registered importers shall report to
the Secretary the total price and the total
volume of drugs imported to the United States
by the importer during the 4-month period from
October 1 through January 31 of such fiscal
year.
(ii) Reestimate.--Notwithstanding
subsection (e)(3)(C)(ii) of such section 804 or
subparagraph (B), the Secretary shall
reestimate the total price of qualifying drugs
imported under subsection (a) of such section
804 into the United States by registered
importers during the second fiscal year in
which this Act is in effect. Such reestimate
shall be equal to--
(I) the total price of qualifying
drugs imported by each importer as
reported under clause (i); multiplied
by
(II) 3.
(iii) Adjustment.--The Secretary shall
adjust the fee due on April 1 of the second
fiscal year in which this Act is in effect,
from each importer so that the aggregate total
of fees collected under subsection (e)(2) for
such fiscal year does not exceed the total
price of qualifying drugs imported under
subsection (a) of such section 804 into the
United States by registered importers during
such fiscal year as reestimated under clause
(ii).
(D) Failure to pay fees.--Notwithstanding any other
provision of this section, the Secretary may prohibit a
registered importer or exporter that is required to pay
user fees under subsection (e) or (f) of such section
804 and that fails to pay such fees within 30 days
after the date on which it is due, from importing or
offering for importation a qualifying drug under such
section 804 until such fee is paid.
(E) Annual report.--
(i) Food and drug administration.--Not
later than 180 days after the end of each
fiscal year during which fees are collected
under subsection (e), (f), or (g)(2)(B)(iv) of
such section 804, the Secretary shall prepare
and submit to the House of Representatives and
the Senate a report on the implementation of
the authority for such fees during such fiscal
year and the use, by the Food and Drug
Administration, of the fees collected for the
fiscal year for which the report is made and
credited to the Food and Drug Administration.
(ii) Customs and border control.--Not later
than 180 days after the end of each fiscal year
during which fees are collected under
subsection (e) or (f) of such section 804, the
Secretary of Homeland Security, in consultation
with the Secretary of the Treasury, shall
prepare and submit to the House of
Representatives and the Senate a report on the
use, by the Bureau of Customs and Border
Protection, of the fees, if any, transferred by
the Secretary to the Bureau of Customs and
Border Protection for the fiscal year for which
the report is made.
(10) Special rule regarding importation by individuals.--
(A) In general.--Notwithstanding any provision of
this Act (or an amendment made by this Act), the
Secretary shall expedite the designation of any
additional countries from which an individual may
import a qualifying drug into the United States under
such section 804 if any action implemented by the
Government of Canada has the effect of limiting or
prohibiting the importation of qualifying drugs into
the United States from Canada.
(B) Timing and criteria.--The Secretary shall
designate such additional countries under subparagraph
(A)--
(i) not later than 6 months after the date
of the action by the Government of Canada
described under such subparagraph; and
(ii) using the criteria described under
subsection (a)(4)(D)(i)(II) of such section
804.
(f) Implementation of Section 804.--
(1) Interim rule.--The Secretary may promulgate an interim
rule for implementing section 804 of the Federal Food, Drug,
and Cosmetic Act, as added by subsection (a) of this section.
(2) No notice of proposed rulemaking.--The interim rule
described under paragraph (1) may be developed and promulgated
by the Secretary without providing general notice of proposed
rulemaking.
(3) Final rule.--Not later than 1 year after the date on
which the Secretary promulgates an interim rule under paragraph
(1), the Secretary shall, in accordance with procedures under
section 553 of title 5, United States Code, promulgate a final
rule for implementing such section 804, which may incorporate
by reference provisions of the interim rule provided for under
paragraph (1), to the extent that such provisions are not
modified.
(g) Consumer Education.--The Secretary shall carry out activities
that educate consumers--
(1) with regard to the availability of qualifying drugs for
import for personal use from an exporter registered with and
approved by the Food and Drug Administration under section 804
of the Federal Food, Drug, and Cosmetic Act, as added by this
section, including information on how to verify whether an
exporter is registered and approved by use of the Internet
website of the Food and Drug Administration and the toll-free
telephone number required by this Act;
(2) that drugs that consumers attempt to import from an
exporter that is not registered with and approved by the Food
and Drug Administration can be seized by the United States
Customs Service and destroyed, and that such drugs may be
counterfeit, unapproved, unsafe, or ineffective;
(3) with regard to the suspension and termination of any
registration of a registered importer or exporter under such
section 804; and
(4) with regard to the availability at domestic retail
pharmacies of qualifying drugs imported under such section 804
by domestic wholesalers and pharmacies registered with and
approved by the Food and Drug Administration.
(h) Effect on Administration Practices.--Notwithstanding any
provision of this Act (and the amendments made by this Act), the
practices and policies of the Food and Drug Administration and Bureau
of Customs and Border Protection, in effect on January 1, 2004, with
respect to the importation of prescription drugs into the United States
by an individual, on the person of such individual, for personal use,
shall remain in effect.
(i) Report to Congress.--The Federal Trade Commission shall, on an
annual basis, submit to Congress a report that describes any action
taken during the period for which the report is being prepared to
enforce the provisions of section 804(n) of the Federal Food, Drug, and
Cosmetic Act (as added by this Act), including any pending
investigations or civil actions under such section.
SEC. 5. DISPOSITION OF CERTAIN DRUGS DENIED ADMISSION INTO UNITED
STATES.
(a) In General.--Chapter VIII of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 381 et seq.), as amended by section 4, is
further amended by adding at the end the following section:
``SEC. 805. DISPOSITION OF CERTAIN DRUGS DENIED ADMISSION.
``(a) In General.--The Secretary of Homeland Security shall deliver
to the Secretary a shipment of drugs that is imported or offered for
import into the United States if--
``(1) the shipment has a declared value of less than
$10,000; and
``(2)(A) the shipping container for such drugs does not
bear the markings required under section 804(d)(2); or
``(B) the Secretary has requested delivery of such shipment
of drugs.
``(b) No Bond or Export.--Section 801(b) does not authorize the
delivery to the owner or consignee of drugs delivered to the Secretary
under subsection (a) pursuant to the execution of a bond, and such
drugs may not be exported.
``(c) Destruction of Violative Shipment.--The Secretary shall
destroy a shipment of drugs delivered by the Secretary of Homeland
Security to the Secretary under subsection (a) if--
``(1) in the case of drugs that are imported or offered for
import from a registered exporter under section 804, the drugs
are in violation of any standard described in section
804(g)(5); or
``(2) in the case of drugs that are not imported or offered
for import from a registered exporter under section 804, the
drugs are in violation of a standard referred to in section
801(a) or 801(d)(1).
``(d) Certain Procedures.--
``(1) In general.--The delivery and destruction of drugs
under this section may be carried out without notice to the
importer, owner, or consignee of the drugs except as required
by section 801(g) or section 804(i)(2). The issuance of
receipts for the drugs, and recordkeeping activities regarding
the drugs, may be carried out on a summary basis.
``(2) Objective of procedures.--Procedures promulgated
under paragraph (1) shall be designed toward the objective of
ensuring that, with respect to efficiently utilizing Federal
resources available for carrying out this section, a
substantial majority of shipments of drugs subject to described
in subsection (c) are identified and destroyed.
``(e) Evidence Exception.--Drugs may not be destroyed under
subsection (c) to the extent that the Attorney General of the United
States determines that the drugs should be preserved as evidence or
potential evidence with respect to an offense against the United
States.
``(f) Rule of Construction.--This section may not be construed as
having any legal effect on applicable law with respect to a shipment of
drugs that is imported or offered for import into the United States and
has a declared value equal to or greater than $10,000.''.
(b) Procedures.--Procedures for carrying out section 805 of the
Federal Food, Drug, and Cosmetic Act, as added by subsection (a), shall
be established not later than 90 days after the date of the enactment
of this Act.
(c) Effective Date.--The amendments made by this section shall take
effect on the date that is 90 days after the date of enactment of this
Act.
SEC. 6. WHOLESALE DISTRIBUTION OF DRUGS; STATEMENTS REGARDING PRIOR
SALE, PURCHASE, OR TRADE.
(a) Striking of Exemptions; Applicability to Registered
Exporters.--Section 503(e) of the Federal Food, Drug, and Cosmetic Act
(21 U.S.C. 353(e)) is amended--
(1) in paragraph (1)--
(A) by striking ``and who is not the manufacturer
or an authorized distributor of record of such drug'';
(B) by striking ``to an authorized distributor of
record or''; and
(C) by striking subparagraph (B) and inserting the
following:
``(B) The fact that a drug subject to subsection (b) is exported
from the United States does not with respect to such drug exempt any
person that is engaged in the business of the wholesale distribution of
the drug from providing the statement described in subparagraph (A) to
the person that receives the drug pursuant to the export of the drug.
``(C)(i) The Secretary shall by regulation establish requirements
that supersede subparagraph (A) (referred to in this subparagraph as
`alternative requirements') to identify the chain of custody of a drug
subject to subsection (b) from the manufacturer of the drug throughout
the wholesale distribution of the drug to a pharmacist who intends to
sell the drug at retail if the Secretary determines that the
alternative requirements, which may include standardized anti-
counterfeiting or track-and-trace technologies, will identify such
chain of custody or the identity of the discrete package of the drug
from which the drug is dispensed with equal or greater certainty to the
requirements of subparagraph (A), and that the alternative requirements
are economically and technically feasible.
``(ii) When the Secretary promulgates a final rule to establish
such alternative requirements, the final rule in addition shall, with
respect to the registration condition established in clause (i) of
section 804(c)(3)(B), establish a condition equivalent to the
alternative requirements, and such equivalent condition may be met in
lieu of the registration condition established in such clause (i).'';
(2) in paragraph (2)(A), by adding at the end the
following: ``The preceding sentence may not be construed as
having any applicability with respect to a registered exporter
under section 804.''; and
(3) in paragraph (3), by striking ``and subsection (d)--''
in the matter preceding subparagraph (A) and all that follows
through ``the term `wholesale distribution' means'' in
subparagraph (B) and inserting the following: ``and subsection
(d), the term `wholesale distribution' means''.
(b) Conforming Amendment.--Section 503(d) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 353(d)) is amended by adding at the
end the following:
``(4) Each manufacturer of a drug subject to subsection (b) shall
maintain at its corporate offices a current list of the authorized
distributors of record of such drug.
``(5) For purposes of this subsection, the term `authorized
distributors of record' means those distributors with whom a
manufacturer has established an ongoing relationship to distribute such
manufacturer's products.''.
(c) Effective Date.--
(1) In general.--The amendments made by paragraphs (1) and
(3) of subsection (a) and by subsection (b) shall take effect
on January 1, 2012.
(2) Drugs imported by registered importers under section
804.--Notwithstanding paragraph (1), the amendments made by
paragraphs (1) and (3) of subsection (a) and by subsection (b)
shall take effect on the date that is 90 days after the date of
enactment of this Act with respect to qualifying drugs imported
under section 804 of the Federal Food, Drug, and Cosmetic Act,
as added by section 4.
(3) Effect with respect to registered exporters.--The
amendment made by subsection (a)(2) shall take effect on the
date that is 90 days after the date of enactment of this Act.
(4) Alternative requirements.--The Secretary shall issue
regulations to establish the alternative requirements, referred
to in the amendment made by subsection (a)(1), that take effect
not later than January 1, 2012.
(5) Intermediate requirements.--The Secretary shall by
regulation require the use of standardized anti-counterfeiting
or track-and-trace technologies on prescription drugs at the
case and pallet level effective not later than 1 year after the
date of enactment of this Act.
(6) Additional requirements.--
(A) In general.--Notwithstanding any other
provision of this section, the Secretary shall, not
later than 18 months after the date of enactment of
this Act, require that the packaging of any
prescription drug incorporates--
(i) a standardized numerical identifier
unique to each package of such drug, applied at
the point of manufacturing and repackaging (in
which case the numerical identifier shall be
linked to the numerical identifier applied at
the point of manufacturing); and
(ii)(I) overt optically variable
counterfeit-resistant technologies that--
(aa) are visible to the naked eye,
providing for visual identification of
product authenticity without the need
for readers, microscopes, lighting
devices, or scanners;
(bb) are similar to that used by
the Bureau of Engraving and Printing to
secure United States currency;
(cc) are manufactured and
distributed in a highly secure, tightly
controlled environment; and
(dd) incorporate additional layers
of nonvisible convert security features
up to and including forensic
capability, as described in
subparagraph (B); or
(II) technologies that have a function of
security comparable to that described in
subclause (I), as determined by the Secretary.
(B) Standards for packaging.--For the purpose of
making it more difficult to counterfeit the packaging
of drugs subject to this paragraph, the manufacturers
of such drugs shall incorporate the technologies
described in subparagraph (A) into at least 1
additional element of the physical packaging of the
drugs, including blister packs, shrink wrap, package
labels, package seals, bottles, and boxes.
SEC. 7. INTERNET SALES OF PRESCRIPTION DRUGS.
(a) In General.--Chapter V of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 351 et seq.) is amended by inserting after section 503B
the following:
``SEC. 503C. INTERNET SALES OF PRESCRIPTION DRUGS.
``(a) Requirements Regarding Information on Internet Site.--
``(1) In general.--A person may not dispense a prescription
drug pursuant to a sale of the drug by such person if--
``(A) the purchaser of the drug submitted the
purchase order for the drug, or conducted any other
part of the sales transaction for the drug, through an
Internet site;
``(B) the person dispenses the drug to the
purchaser by mailing or shipping the drug to the
purchaser; and
``(C) such site, or any other Internet site used by
such person for purposes of sales of a prescription
drug, fails to meet each of the requirements specified
in paragraph (2), other than a site or pages on a site
that--
``(i) are not intended to be accessed by
purchasers or prospective purchasers; or
``(ii) provide an Internet information
location tool within the meaning of section
231(e)(5) of the Communications Act of 1934 (47
U.S.C. 231(e)(5)).
``(2) Requirements.--With respect to an Internet site, the
requirements referred to in subparagraph (C) of paragraph (1)
for a person to whom such paragraph applies are as follows:
``(A) Each page of the site shall include either
the following information or a link to a page that
provides the following information:
``(i) The name of such person.
``(ii) Each State in which the person is
authorized by law to dispense prescription
drugs.
``(iii) The address and telephone number of
each place of business of the person with
respect to sales of prescription drugs through
the Internet, other than a place of business
that does not mail or ship prescription drugs
to purchasers.
``(iv) The name of each individual who
serves as a pharmacist for prescription drugs
that are mailed or shipped pursuant to the
site, and each State in which the individual is
authorized by law to dispense prescription
drugs.
``(v) If the person provides for medical
consultations through the site for purposes of
providing prescriptions, the name of each
individual who provides such consultations;
each State in which the individual is licensed
or otherwise authorized by law to provide such
consultations or practice medicine; and the
type or types of health professions for which
the individual holds such licenses or other
authorizations.
``(B) A link to which paragraph (1) applies shall
be displayed in a clear and prominent place and manner,
and shall include in the caption for the link the words
`licensing and contact information'.
``(b) Internet Sales Without Appropriate Medical Relationships.--
``(1) In general.--Except as provided in paragraph (2), a
person may not dispense a prescription drug, or sell such a
drug, if--
``(A) for purposes of such dispensing or sale, the
purchaser communicated with the person through the
Internet;
``(B) the patient for whom the drug was dispensed
or purchased did not, when such communications began,
have a prescription for the drug that is valid in the
United States;
``(C) pursuant to such communications, the person
provided for the involvement of a practitioner, or an
individual represented by the person as a practitioner,
and the practitioner or such individual issued a
prescription for the drug that was purchased;
``(D) the person knew, or had reason to know, that
the practitioner or the individual referred to in
subparagraph (C) did not, when issuing the
prescription, have a qualifying medical relationship
with the patient; and
``(E) the person received payment for the
dispensing or sale of the drug.
For purposes of subparagraph (E), payment is received if money
or other valuable consideration is received.
``(2) Exceptions.--Paragraph (1) does not apply to--
``(A) the dispensing or selling of a prescription
drug pursuant to telemedicine practices sponsored by--
``(i) a hospital that has in effect a
provider agreement under title XVIII of the
Social Security Act (relating to the Medicare
program); or
``(ii) a group practice that has not fewer
than 100 physicians who have in effect provider
agreements under such title; or
``(B) the dispensing or selling of a prescription
drug pursuant to practices that promote the public
health, as determined by the Secretary by regulation.
``(3) Qualifying medical relationship.--
``(A) In general.--With respect to issuing a
prescription for a drug for a patient, a practitioner
has a qualifying medical relationship with the patient
for purposes of this section if--
``(i) at least one in-person medical
evaluation of the patient has been conducted by
the practitioner; or
``(ii) the practitioner conducts a medical
evaluation of the patient as a covering
practitioner.
``(B) In-person medical evaluation.--A medical
evaluation by a practitioner is an in-person medical
evaluation for purposes of this section if the
practitioner is in the physical presence of the patient
as part of conducting the evaluation, without regard to
whether portions of the evaluation are conducted by
other health professionals.
``(C) Covering practitioner.--With respect to a
patient, a practitioner is a covering practitioner for
purposes of this section if the practitioner conducts a
medical evaluation of the patient at the request of a
practitioner who has conducted at least one in-person
medical evaluation of the patient and is temporarily
unavailable to conduct the evaluation of the patient. A
practitioner is a covering practitioner without regard
to whether the practitioner has conducted any in-person
medical evaluation of the patient involved.
``(4) Rules of construction.--
``(A) Individuals represented as practitioners.--A
person who is not a practitioner (as defined in
subsection (e)(1)) lacks legal capacity under this
section to have a qualifying medical relationship with
any patient.
``(B) Standard practice of pharmacy.--Paragraph (1)
may not be construed as prohibiting any conduct that is
a standard practice in the practice of pharmacy.
``(C) Applicability of requirements.--Paragraph (3)
may not be construed as having any applicability beyond
this section, and does not affect any State law, or
interpretation of State law, concerning the practice of
medicine.
``(c) Actions by States.--
``(1) In general.--Whenever an attorney general of any
State has reason to believe that the interests of the residents
of that State have been or are being threatened or adversely
affected because any person has engaged or is engaging in a
pattern or practice that violates section 301(l), the State may
bring a civil action on behalf of its residents in an
appropriate district court of the United States to enjoin such
practice, to enforce compliance with such section (including a
nationwide injunction), to obtain damages, restitution, or
other compensation on behalf of residents of such State, to
obtain reasonable attorneys fees and costs if the State
prevails in the civil action, or to obtain such further and
other relief as the court may deem appropriate.
``(2) Notice.--The State shall serve prior written notice
of any civil action under paragraph (1) or (5)(B) upon the
Secretary and provide the Secretary with a copy of its
complaint, except that if it is not feasible for the State to
provide such prior notice, the State shall serve such notice
immediately upon instituting such action. Upon receiving a
notice respecting a civil action, the Secretary shall have the
right--
``(A) to intervene in such action;
``(B) upon so intervening, to be heard on all
matters arising therein; and
``(C) to file petitions for appeal.
``(3) Construction.--For purposes of bringing any civil
action under paragraph (1), nothing in this chapter shall
prevent an attorney general of a State from exercising the
powers conferred on the attorney general by the laws of such
State to conduct investigations or to administer oaths or
affirmations or to compel the attendance of witnesses or the
production of documentary and other evidence.
``(4) Venue; service of process.--Any civil action brought
under paragraph (1) in a district court of the United States
may be brought in the district in which the defendant is found,
is an inhabitant, or transacts business or wherever venue is
proper under section 1391 of title 28, United States Code.
Process in such an action may be served in any district in
which the defendant is an inhabitant or in which the defendant
may be found.
``(5) Actions by other state officials.--
``(A) Nothing contained in this section shall
prohibit an authorized State official from proceeding
in State court on the basis of an alleged violation of
any civil or criminal statute of such State.
``(B) In addition to actions brought by an attorney
general of a State under paragraph (1), such an action
may be brought by officers of such State who are
authorized by the State to bring actions in such State
on behalf of its residents.
``(d) Effect of Section.--This section shall not apply to a person
that is a registered exporter under section 804.
``(e) General Definitions.--For purposes of this section:
``(1) The term `practitioner' means a practitioner referred
to in section 503(b)(1) with respect to issuing a written or
oral prescription.
``(2) The term `prescription drug' means a drug that is
described in section 503(b)(1).
``(3) The term `qualifying medical relationship', with
respect to a practitioner and a patient, has the meaning
indicated for such term in subsection (b).
``(f) Internet-Related Definitions.--
``(1) In general.--For purposes of this section:
``(A) The term `Internet' means collectively the
myriad of computer and telecommunications facilities,
including equipment and operating software, which
comprise the interconnected world-wide network of
networks that employ the transmission control protocol/
internet protocol, or any predecessor or successor
protocols to such protocol, to communicate information
of all kinds by wire or radio.
``(B) The term `link', with respect to the
Internet, means one or more letters, words, numbers,
symbols, or graphic items that appear on a page of an
Internet site for the purpose of serving, when
activated, as a method for executing an electronic
command--
``(i) to move from viewing one portion of a
page on such site to another portion of the
page;
``(ii) to move from viewing one page on
such site to another page on such site; or
``(iii) to move from viewing a page on one
Internet site to a page on another Internet
site.
``(C) The term `page', with respect to the
Internet, means a document or other file accessed at an
Internet site.
``(D)(i) The terms `site' and `address', with
respect to the Internet, mean a specific location on
the Internet that is determined by Internet Protocol
numbers. Such term includes the domain name, if any.
``(ii) The term `domain name' means a method of
representing an Internet address without direct
reference to the Internet Protocol numbers for the
address, including methods that use designations such
as `.com', `.edu', `.gov', `.net', or `.org'.
``(iii) The term `Internet Protocol numbers'
includes any successor protocol for determining a
specific location on the Internet.
``(2) Authority of secretary.--The Secretary may by
regulation modify any definition under paragraph (1) to take
into account changes in technology.
``(g) Interactive Computer Service; Advertising.--No provider of an
interactive computer service, as defined in section 230(f)(2) of the
Communications Act of 1934 (47 U.S.C. 230(f)(2)), or of advertising
services shall be liable under this section for dispensing or selling
prescription drugs in violation of this section on account of another
person's selling or dispensing such drugs, provided that the provider
of the interactive computer service or of advertising services does not
own or exercise corporate control over such person.''.
(b) Inclusion as Prohibited Act.--Section 301 of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 331) is amended by inserting after
paragraph (k) the following:
``(l) The dispensing or selling of a prescription drug in violation
of section 503C.''.
(c) Internet Sales of Prescription Drugs; Consideration by
Secretary of Practices and Procedures for Certification of Legitimate
Businesses.--In carrying out section 503C of the Federal Food, Drug,
and Cosmetic Act (as added by subsection (a) of this section), the
Secretary of Health and Human Services shall take into consideration
the practices and procedures of public or private entities that certify
that businesses selling prescription drugs through Internet sites are
legitimate businesses, including practices and procedures regarding
disclosure formats and verification programs.
(d) Reports Regarding Internet-Related Violations of Federal and
State Laws on Dispensing of Drugs.--
(1) In general.--The Secretary of Health and Human Services
(referred to in this subsection as the ``Secretary'') shall,
pursuant to the submission of an application meeting the
criteria of the Secretary, make an award of a grant or contract
to the National Clearinghouse on Internet Prescribing (operated
by the Federation of State Medical Boards) for the purpose of--
(A) identifying Internet sites that appear to be in
violation of Federal or State laws concerning the
dispensing of drugs;
(B) reporting such sites to State medical licensing
boards and State pharmacy licensing boards, and to the
Attorney General and the Secretary, for further
investigation; and
(C) submitting, for each fiscal year for which the
award under this subsection is made, a report to the
Secretary describing investigations undertaken with
respect to violations described in subparagraph (A).
(2) Authorization of appropriations.--For the purpose of
carrying out paragraph (1), there is authorized to be
appropriated $100,000 for each of the first 3 fiscal years in
which this section is in effect.
(e) Effective Date.--The amendments made by subsections (a) and (b)
take effect 90 days after the date of enactment of this Act, without
regard to whether a final rule to implement such amendments has been
promulgated by the Secretary of Health and Human Services under section
701(a) of the Federal Food, Drug, and Cosmetic Act. The preceding
sentence may not be construed as affecting the authority of such
Secretary to promulgate such a final rule.
SEC. 8. PROHIBITING PAYMENTS TO UNREGISTERED FOREIGN PHARMACIES.
(a) In General.--Section 303 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 333) is amended by adding at the end the
following:
``(h) Restricted Transactions.--
``(1) In general.--The introduction of restricted
transactions into a payment system or the completion of
restricted transactions using a payment system is prohibited.
``(2) Payment system.--
``(A) In general.--The term `payment system' means
a system used by a person described in subparagraph (B)
to effect a credit transaction, electronic fund
transfer, or money transmitting service that may be
used in connection with, or to facilitate, a restricted
transaction, and includes--
``(i) a credit card system;
``(ii) an international, national,
regional, or local network used to effect a
credit transaction, an electronic fund
transfer, or a money transmitting service; and
``(iii) any other system that is centrally
managed and is primarily engaged in the
transmission and settlement of credit
transactions, electronic fund transfers, or
money transmitting services.
``(B) Persons described.--A person referred to in
subparagraph (A) is--
``(i) a creditor;
``(ii) a credit card issuer;
``(iii) a financial institution;
``(iv) an operator of a terminal at which
an electronic fund transfer may be initiated;
``(v) a money transmitting business; or
``(vi) a participant in an international,
national, regional, or local network used to
effect a credit transaction, electronic fund
transfer, or money transmitting service.
``(3) Restricted transaction.--The term `restricted
transaction' means a transaction or transmittal, on behalf of
an individual who places an unlawful drug importation request
to any person engaged in the operation of an unregistered
foreign pharmacy, of--
``(A) credit, or the proceeds of credit, extended
to or on behalf of the individual for the purpose of
the unlawful drug importation request (including credit
extended through the use of a credit card);
``(B) an electronic fund transfer or funds
transmitted by or through a money transmitting
business, or the proceeds of an electronic fund
transfer or money transmitting service, from or on
behalf of the individual for the purpose of the
unlawful drug importation request;
``(C) a check, draft, or similar instrument which
is drawn by or on behalf of the individual for the
purpose of the unlawful drug importation request and is
drawn on or payable at or through any financial
institution; or
``(D) the proceeds of any other form of financial
transaction (identified by the Board by regulation)
that involves a financial institution as a payor or
financial intermediary on behalf of or for the benefit
of the individual for the purpose of the unlawful drug
importation request.
``(4) Unlawful drug importation request.--The term
`unlawful drug importation request' means the request, or
transmittal of a request, made to an unregistered foreign
pharmacy for a prescription drug by mail (including a private
carrier), facsimile, phone, or electronic mail, or by a means
that involves the use, in whole or in part, of the Internet.
``(5) Unregistered foreign pharmacy.--The term
`unregistered foreign pharmacy' means a person in a country
other than the United States that is not a registered exporter
under section 804.
``(6) Other definitions.--
``(A) Credit; creditor; credit card.--The terms
`credit', `creditor', and `credit card' have the
meanings given the terms in section 103 of the Truth in
Lending Act (15 U.S.C. 1602).
``(B) Access device; electronic fund transfer.--The
terms `access device' and `electronic fund transfer'--
``(i) have the meaning given the term in
section 903 of the Electronic Fund Transfer Act
(15 U.S.C. 1693a); and
``(ii) the term `electronic fund transfer'
also includes any fund transfer covered under
Article 4A of the Uniform Commercial Code, as
in effect in any State.
``(C) Financial institution.--The term `financial
institution'--
``(i) has the meaning given the term in
section 903 of the Electronic Transfer Fund Act
(15 U.S.C. 1693a); and
``(ii) includes a financial institution (as
defined in section 509 of the Gramm-Leach-
Bliley Act (15 U.S.C. 6809)).
``(D) Money transmitting business; money
transmitting service.--The terms `money transmitting
business' and `money transmitting service' have the
meaning given the terms in section 5330(d) of title 31,
United States Code.
``(E) Board.--The term `Board' means the Board of
Governors of the Federal Reserve System.
``(7) Policies and procedures required to prevent
restricted transactions.--
``(A) Regulations.--The Board shall promulgate
regulations requiring--
``(i) an operator of a credit card system;
``(ii) an operator of an international,
national, regional, or local network used to
effect a credit transaction, an electronic fund
transfer, or a money transmitting service;
``(iii) an operator of any other payment
system that is centrally managed and is
primarily engaged in the transmission and
settlement of credit transactions, electronic
transfers or money transmitting services where
at least one party to the transaction or
transfer is an individual; and
``(iv) any other person described in
paragraph (2)(B) and specified by the Board in
such regulations,
to establish policies and procedures that are
reasonably designed to prevent the introduction of a
restricted transaction into a payment system or the
completion of a restricted transaction using a payment
system.
``(B) Requirements for policies and procedures.--In
promulgating regulations under subparagraph (A), the
Board shall--
``(i) identify types of policies and
procedures, including nonexclusive examples,
that shall be considered to be reasonably
designed to prevent the introduction of
restricted transactions into a payment system
or the completion of restricted transactions
using a payment system; and
``(ii) to the extent practicable, permit
any payment system, or person described in
paragraph (2)(B), as applicable, to choose
among alternative means of preventing the
introduction or completion of restricted
transactions.
``(C) No liability for blocking or refusing to
honor restricted transaction.--
``(i) In general.--A payment system, or a
person described in paragraph (2)(B) that is
subject to a regulation issued under this
subsection, and any participant in such payment
system that prevents or otherwise refuses to
honor transactions in an effort to implement
the policies and procedures required under this
subsection or to otherwise comply with this
subsection shall not be liable to any party for
such action.
``(ii) Compliance.--A person described in
paragraph (2)(B) meets the requirements of this
subsection if the person relies on and complies
with the policies and procedures of a payment
system of which the person is a member or in
which the person is a participant, and such
policies and procedures of the payment system
comply with the requirements of the regulations
promulgated under subparagraph (A).
``(D) Enforcement.--
``(i) In general.--This section shall be
enforced by the Federal functional regulators
and the Federal Trade Commission under
applicable law in the manner provided in
section 505(a) of the Gramm-Leach-Bliley Act
(15 U.S.C. 6805(a)).
``(ii) Factors to be considered.--In
considering any enforcement action under this
subsection against a payment system or person
described in paragraph (2)(B), the Federal
functional regulators and the Federal Trade
Commission shall consider the following
factors:
``(I) The extent to which the
payment system or person knowingly
permits restricted transactions.
``(II) The history of the payment
system or person in connection with
permitting restricted transactions.
``(III) The extent to which the
payment system or person has
established and is maintaining policies
and procedures in compliance with
regulations prescribed under this
subsection.
``(8) Transactions permitted.--A payment system, or a
person described in paragraph (2)(B) that is subject to a
regulation issued under this subsection, is authorized to
engage in transactions with foreign pharmacies in connection
with investigating violations or potential violations of any
rule or requirement adopted by the payment system or person in
connection with complying with paragraph (7). A payment system,
or such a person, and its agents and employees shall not be
found to be in violation of, or liable under, any Federal,
State or other law by virtue of engaging in any such
transaction.
``(9) Relation to state laws.--No requirement, prohibition,
or liability may be imposed on a payment system, or a person
described in paragraph (2)(B) that is subject to a regulation
issued under this subsection, under the laws of any State with
respect to any payment transaction by an individual because the
payment transaction involves a payment to a foreign pharmacy.
``(10) Timing of requirements.--A payment system, or a
person described in paragraph (2)(B) that is subject to a
regulation issued under this subsection, must adopt policies
and procedures reasonably designed to comply with any
regulations required under paragraph (7) within 60 days after
such regulations are issued in final form.''.
(b) Effective Date.--The amendment made by this section shall take
effect on the day that is 90 days after the date of enactment of this
Act.
(c) Implementation.--The Board of Governors of the Federal Reserve
System shall promulgate regulations as required by subsection (h)(7) of
section 303 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
333), as added by subsection (a), not later than 90 days after the date
of enactment of this Act.
SEC. 9. IMPORTATION EXEMPTION UNDER CONTROLLED SUBSTANCES IMPORT AND
EXPORT ACT.
Section 1006(a)(2) of the Controlled Substances Import and Export
Act (21 U.S.C. 956(a)(2)) is amended by striking ``not import the
controlled substance into the United States in an amount that exceeds
50 dosage units of the controlled substance.'' and inserting ``import
into the United States not more than 10 dosage units combined of all
such controlled substances.''.
SEC. 10. SEVERABILITY.
If any provision of this Act, an amendment by this Act, or the
application of such provision or amendment to any person or
circumstance is held to be unconstitutional, the remainder of this Act,
the amendments made by this Act, and the application of the provisions
of such to any person or circumstance shall not affected thereby.
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