[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 2082 Introduced in Senate (IS)]
<DOC>
117th CONGRESS
1st Session
S. 2082
To mitigate drug shortages and provide incentives for maintaining,
expanding, and relocating the manufacturing of active pharmaceutical
ingredients, excipients, medical diagnostic devices, pharmaceuticals,
and personal protective equipment in the United States, and for other
purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
June 16, 2021
Mr. Scott of South Carolina (for himself and Ms. Rosen) introduced the
following bill; which was read twice and referred to the Committee on
Finance
_______________________________________________________________________
A BILL
To mitigate drug shortages and provide incentives for maintaining,
expanding, and relocating the manufacturing of active pharmaceutical
ingredients, excipients, medical diagnostic devices, pharmaceuticals,
and personal protective equipment in the United States, 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 ``Manufacturing API, Drugs, and
Excipients in America Act'' or the ``MADE in America Act''.
SEC. 2. TABLE OF CONTENTS.
The table of contents of this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
TITLE I--HEALTH PROVISIONS
Sec. 101. Report to Congress on barriers to domestic manufacturing of
medical products.
Sec. 102. Enhance intra-agency coordination and public health
assessment with regard to compliance
activities.
Sec. 103. Reporting of mutual recognition agreements for inspections
and review activities.
Sec. 104. Enhancing transparency of drug facility inspection timelines.
Sec. 105. Advanced manufacturing technologies program.
TITLE II--TAX INCENTIVES TO INCREASE DOMESTIC PHARMACEUTICAL AND
MEDICAL DEVICE PRODUCTION
Sec. 201. Credit for pharmaceutical and medical device production
activities in distressed zones.
TITLE I--HEALTH PROVISIONS
SEC. 101. REPORT TO CONGRESS ON BARRIERS TO DOMESTIC MANUFACTURING OF
MEDICAL PRODUCTS.
(a) Report.--Not later than 6 months after the date of enactment of
this Act, the Secretary of Health and Human Services, the Secretary of
the Treasury, the Secretary of Commerce, and the United States Trade
Representative (collectively referred to in this section as the
``Secretaries'') shall submit to the Committee on Health, Education,
Labor, and Pensions of the Senate and the Committee on Energy and
Commerce of the House of Representatives a report on barriers to
domestic manufacturing of active pharmaceutical ingredients, finished
drug products, and devices that are imported from outside of the United
States.
(b) Contents.--Such report shall--
(1) identify factors that limit or otherwise discourage the
domestic manufacturing of active pharmaceutical ingredients,
drugs, and devices that are currently imported from outside of
the United States, including any Federal, State, local, or
Tribal laws that hinder domestic manufacturing opportunities;
and
(2) recommend specific strategies to overcome the
challenges identified under paragraph (1), including
strategies--
(A) to develop effective incentives for domestic
manufacturing; and
(B) to make changes to laws or regulations that
hinder domestic manufacturing opportunities.
(c) Consultation.--In preparing the report under subsection (a),
the Secretaries shall consult with--
(1) the Food and Drug Administration, the Centers for
Medicare & Medicaid Services, the Department of Defense, the
Department of State, the Department of Veterans Affairs, the
Department of Justice, and any other Federal agencies as
appropriate; and
(2) relevant stakeholders, including drug, device, and
active pharmaceutical ingredient manufacturers, and other
entities, as appropriate.
(d) Definition.--In this section, the term ``active pharmaceutical
ingredient'' has the meaning given to such term in section 207.1 of
title 21, Code of Federal Regulations (or any successor regulations).
(e) Publication.--The Secretary shall make the report under
subsection (a) available on the public website of the Department of
Health and Human Services.
SEC. 102. ENHANCE INTRA-AGENCY COORDINATION AND PUBLIC HEALTH
ASSESSMENT WITH REGARD TO COMPLIANCE ACTIVITIES.
(a) Coordination.--Section 506D of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 356d) is amended by adding at the end the
following:
``(g) Coordination.--The Secretary shall ensure timely and
effective internal coordination and alignment among the field
investigators of the Food and Drug Administration and the staff of the
Center for Drug Evaluation and Research's Office of Compliance and Drug
Shortage Program regarding the reviews of reports shared pursuant to
section 704(b)(2), and any feedback or corrective or preventive actions
in response to such reports.''.
(b) Reporting.--Section 506C-1(a)(2) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 356c-1(a)(2)) is amended to read as follows:
``(2)(A) describes the communication between the field
investigators of the Food and Drug Administration and the staff
of the Center for Drug Evaluation and Research's Office of
Compliance and Drug Shortage Program, including the Food and
Drug Administration's procedures for enabling and ensuring such
communication;
``(B) provides the number of reports described in section
704(b)(2) that were required to be sent to the appropriate
offices of the Food and Drug Administration with expertise
regarding drug shortage and the number of such reports that
were sent; and
``(C) describes the adoption and utilization of the
approach described in section 506D(g);''.
(c) Applicability.--
(1) Subsection (a).--The amendment made by subsection (a)
shall apply beginning on the date of enactment of this Act.
(2) Subsection (b).--The amendment made by subsection (b)
shall apply beginning on the date that is 1 year after the date
of enactment of this Act.
SEC. 103. REPORTING OF MUTUAL RECOGNITION AGREEMENTS FOR INSPECTIONS
AND REVIEW ACTIVITIES.
(a) In General.--Not later than the end of calendar year 2020, and
annually thereafter, the Secretary of Health and Human Services
(referred to in this section as the ``Secretary'') shall publish a
report on the public website of the Food and Drug Administration on the
utilization of agreements entered into pursuant to section 809 of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 384e) or otherwise
entered into by the Secretary to recognize inspections between drug
regulatory authorities across countries and international regions with
analogous review criteria to the Food and Drug Administration, such as
the Pharmaceutical Inspection Co-Operation Scheme, the Mutual
Recognition Agreement with the European Union, and the Australia-
Canada-Singapore-Switzerland Consortium, in the previous fiscal year.
(b) Content.--The report under subsection (a) shall include each of
the following:
(1) The total number of establishments that are registered
under section 510(i) of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 360(i)), and of such establishments, the number
in each region of interest.
(2) The total number of inspections conducted as described
in subparagraphs (A) and (B) of paragraph (5) at establishments
described in paragraph (1).
(3) Of the inspections described in paragraph (2), the
total number of inspections in each of region of interest.
(4) Of the inspections in each region of interest reported
pursuant to paragraph (3), the number of inspections in each
FDA inspection category.
(5) Of the number of inspections reported under each of
paragraphs (3) and (4)--
(A) the number of inspections which have been
conducted pursuant to an agreement or other recognition
described in subsection (a); and
(B) the number of inspections which have been
conducted by employees or contractors of the Food and
Drug Administration.
(c) Definitions.--In this subsection:
(1) FDA inspection category.--The term ``FDA inspection
category'' means the following inspection categories:
(A) Inspections to support approvals of changes to
the manufacturing process of drugs approved under
section 505 of the Federal Food, Drug, and Cosmetic Act
(21 U.S.C. 355) or section 351 of the Public Health
Service Act (42 U.S.C. 262).
(B) Good manufacturing practice surveillance
inspections.
(C) For-cause inspections.
(2) Region of interest.--The term ``region of interest''
means China, India, the European Union, and any other
geographic region as the Secretary determines appropriate.
SEC. 104. ENHANCING TRANSPARENCY OF DRUG FACILITY INSPECTION TIMELINES.
Section 902 of the FDA Reauthorization Act of 2017 (21 U.S.C. 355
note) is amended to read as follows:
``SEC. 902. ANNUAL REPORT ON INSPECTIONS.
``Not later than March 1 of each year, the Secretary of Health and
Human Services shall post on the public website of the Food and Drug
Administration information related to inspections of facilities,
including inspections that are necessary for approval of a drug under
subsection (c) or (j) of section 505 of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355), approval of a device under section 515 of
such Act (21 U.S.C. 360e), or clearance of a device under section
510(k) of such Act (21 U.S.C. 360(k)) that were conducted during the
previous calendar year. Such information shall include the following:
``(1) The median time following a request from staff of the
Food and Drug Administration reviewing an application or report
to the beginning of the inspection, including--
``(A) the median time for drugs described in
section 505(j)(11)(A)(i) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 355(j)(11)(A)(i));
``(B) the median time for drugs described in
section 506C(a) of such Act (21 U.S.C. 356c(a)) only;
and
``(C) the median time for drugs on the drug
shortage list in effect under section 506E of such Act
(21 U.S.C. 356f).
``(2) The median time from the issuance of a report
pursuant to section 704(b) of such Act (21 U.S.C. 374(b)) to
the sending of a warning letter, issuance of an import alert,
or holding of a regulatory meeting for inspections for which
the Secretary concluded that regulatory or enforcement action
was indicated, including the median time for each category of
drugs listed in subparagraphs (A) through (C) of paragraph (1).
``(3) The median time from the sending of a warning letter,
issuance of an import alert, or holding of a regulatory meeting
to resolution of the actions indicated to address the
conditions or practices observed during an inspection.
``(4) The number of facilities that were unable to
implement requested corrective or preventive actions following
a report pursuant to such section 704(b), resulting in a
withhold recommendation, including the number of such times for
each category of drugs listed in subparagraphs (A) through (C)
of paragraph (1).''.
SEC. 105. ADVANCED MANUFACTURING TECHNOLOGIES PROGRAM.
Subchapter A of chapter V of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 351 et seq.) is amended by adding at the end the
following:
``SEC. 524B. ADVANCED MANUFACTURING TECHNOLOGIES PROGRAM.
``(a) In General.--Not later than 1 year after the date of
enactment of the Manufacturing API, Drugs, and Excipients in America
Act, the Secretary shall continue in effect the programs to facilitate
the development and review of an application under subsection (b) or
(j) of section 505 of this Act or subsection (a) or (k) of section 351
of the Public Health Service Act for a drug or biological product that
is manufactured using one of more advanced manufacturing technologies
that have been designated in accordance with subsection (b).
``(b) Designation.--The Secretary shall designate a method of
manufacturing or development of a drug or biological product as an
advanced manufacturing technology under this section if it incorporates
a novel technology or uses an established technique or technology in a
novel way that--
``(1) enhances drug quality; or
``(2) improves the flexibility, robustness, or efficiency
of the manufacturing process to--
``(A) prevent or resolve a drug shortage;
``(B) reduce premarket development time; or
``(C) increase the supply of drugs described in
paragraph (1) or (2) of section 506C(a) for national
emergencies.
``(c) Consultation.--If the Secretary designates a method of
manufacturing as an advanced manufacturing technology under this
section, the Secretary shall take actions to expedite the development
and implementation of such method of manufacture for purposes of
approval of an application under subsection (c) or (j) of section 505
of this Act or subsection (a) or (k) of section 351 of the Public
Health Service Act, which may include, as appropriate, holding meetings
between the sponsor of the application and appropriate Food and Drug
Administration staff throughout the development of the drug of
biological product using such advanced manufacturing technology.
``(d) Evaluation of an Advanced Manufacturing Technology.--
``(1) Package.--A person who seeks designation of an
advanced manufacturing technology under this section shall
submit to the Secretary a package of scientific evidence
supporting the implementation of the advanced manufacturing
technology in a particular context-of-use. The Secretary shall
assist with the development of such package by--
``(A) providing timely advice to, and interactive
communication with, the sponsor regarding the
development of the technology; and
``(B) involving senior managers and experienced
staff of the Food and Drug Administration, as
appropriate, in a collaborative, cross-disciplinary
review of the method of manufacturing.
``(2) Evaluation.--Within 90 days of receiving a package
under paragraph (1), the Secretary shall determine whether a
designated advanced manufacturing technology is validated for
the proposed context of use based on the scientific merit the
supporting evidence provided by the sponsor.
``(3) Effect of designation.--Upon designation of an
advanced manufacturing technology, the holder of the advanced
manufacturing technology designation, or a person the advanced
manufacturing technology designation holder authorizes, may
rely upon the advanced manufacturing technology for use across
multiple manufacturing or product lines within the same
context-of-use without having to re-submit data to the
Secretary validating the underlying technology.
``(e) Implementation and Reporting.--
``(1) Public meeting.--The Secretary shall publish in the
Federal Register a notice of a public meeting, to be held not
later than 1 year after the date of enactment of the
Manufacturing API, Drugs, and Excipients in America Act, to
discuss and obtain input and recommendations from stakeholders
regarding the goals and scope of, and a suitable framework and
procedures and requirements for, the program under this
section.
``(2) Program guidance.--The Secretary shall--
``(A) not later than 1 year after the date of
enactment of the Manufacturing API, Drugs, and
Excipients in America Act, issue draft guidance
regarding the goals and implementation of the program
under this section; and
``(B) not later than 2 years after the date of
enactment of the Manufacturing API, Drugs, and
Excipients in America Act, issue final guidance with
respect to the implementation of such program.
``(3) Report.--The Secretary shall make available on the
public website of the Food and Drug Administration an annual
report on the progress of the programs under this section.''.
TITLE II--TAX INCENTIVES TO INCREASE DOMESTIC PHARMACEUTICAL AND
MEDICAL DEVICE PRODUCTION
SEC. 201. CREDIT FOR PHARMACEUTICAL AND MEDICAL DEVICE PRODUCTION
ACTIVITIES IN DISTRESSED ZONES.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by adding at the end
the following new section:
``SEC. 45U. DISTRESSED ZONE PHARMACEUTICAL AND MEDICAL DEVICE
PRODUCTION CREDIT.
``(a) In General.--For purposes of section 38, the distressed zone
pharmaceutical and medical device production credit for the taxable
year shall be an amount equal to the applicable percentage of the
qualified production activity expenditures of the taxpayer for the
taxable year.
``(b) Applicable Percentage.--For purposes of this section--
``(1) In general.--Except as provided in paragraph (2), the
term `applicable percentage' means 25 percent.
``(2) Increased amount where employees reside in distressed
zone.--In the case of any qualified pharmaceutical or medical
device production business a substantial portion of the
employees of which reside in a distressed zone, the applicable
percentage shall be 30 percent.
``(c) Qualified Production Activity Expenditures.--For purposes of
this section--
``(1) In general.--The term `qualified production activity
expenditures' means--
``(A) wages paid or incurred to an employee of the
taxpayer for services performed by such employee in the
conduct of a qualified pharmaceutical or diagnostic
medical device production business in a distressed zone
(but only if the employee's principal place of
employment is in a distressed zone), and
``(B) qualified pharmaceutical or medical device
production expenditures.
``(2) Qualified pharmaceutical or medical device production
business.--
``(A) In general.--The term `qualified
pharmaceutical or medical device production business'
means the trade or business of producing qualified
pharmaceuticals in commercial quantities.
``(B) Qualified pharmaceuticals.--
``(i) In general.--The term `qualified
pharmaceuticals' means pharmaceuticals, active
pharmaceutical ingredients, excipients, medical
diagnostic devices, or personal protective
equipment.
``(ii) Pharmaceutical.--The term
`pharmaceuticals'--
``(I) means any drug (as defined in
section 201 of the Federal Food, Drug,
and Cosmetic Act); and
``(II) includes a biological
product (as defined in section 351 of
the Public Health Service Act).
``(iii) Active pharmaceutical ingredient.--
The term `active pharmaceutical ingredients'
has the meaning given to such term in section
207.1 of title 21, Code of Federal Regulations
(or any successor regulations).
``(iv) Excipient.--The term `excipient'--
``(I) means any inactive ingredient
that is intentionally added to a
pharmaceutical that is not intended to
exert therapeutic effects at the
intended dosage, other than by acting
to improve product delivery; and
``(II) includes any such filler,
extenders, diluent, wetting agent,
solvent, emulsifier, preservative,
flavor, absorption enhancer, sustained
release matrix, and coloring agent.
``(v) Medical diagnostic device.--The term
`medical diagnostic device' means any device
(as defined in section 201(h) of the Federal
Food, Drug, and Cosmetic Act) intended for use
in the diagnosis of disease or other
conditions.
``(vi) Personal protective equipment.--The
term `personal protective equipment' means--
``(I) any device (as defined in
section 201(h) of the Federal Food,
Drug, and Cosmetic Act) that is a face
mask, filtering facepiece respirator,
face shield, surgical mask, gown, other
apparel, or glove that is intended for
a medical purpose; and
``(II) any particulate filtering
air purifying respiratory protective
device that is approved by the National
Institute for Occupational Safety and
Health under part 84 of title 42, Code
of Federal Regulations (or successor
regulations).
``(3) Certain health plan expenses treated as wages.--
``(A) In general.--The term `wages' shall include
so much of the eligible employer's qualified health
plan expenses as are properly allocable to such wages.
``(B) Qualified health plan expenses.--For purposes
of this paragraph, the term `qualified health plan
expenses' means amounts paid or incurred by the
eligible employer to provide and maintain a group
health plan (as defined in section 5000(b)(1)), but
only to the extent that such amounts are excluded from
the gross income of employees by reason of section
106(a) of such Code.
``(C) Allocation rules.--For purposes of this
paragraph, qualified health plan expenses shall be
allocated to qualified wages in such manner as the
Secretary may prescribe. Except as otherwise provided
by the Secretary, such allocation shall be treated as
properly made if made on the basis of being pro rata
among employees and pro rata on the basis of periods of
coverage (relative to the periods to which such wages
relate).
``(4) Qualified pharmaceutical or medical device production
expenditures.--
``(A) Definition.--The term `qualified
pharmaceutical or medical device production
expenditures' means amount paid or incurred (whether or
not chargeable to capital account) for qualified
property used in the conduct of a qualified
pharmaceutical or medical device production business in
a distressed zone (but only if the primary use of such
property is in a distressed zone).
``(B) Qualified property.--
``(i) In general.--The term `qualified
property' means any tangible personal property
(other than a building or its structural
components) used in the conduct of a qualified
pharmaceutical or medical device production
business in a distressed zone (but only if the
primary use of such property is in a distressed
zone).
``(ii) Exception.--Such term shall not
include any property described in section 50(b)
(determined as if the United States included
Puerto Rico).
``(d) Distressed Zone.--For purposes of this section, the term
`distressed zone' means a population census tract--
``(1) which has been designated as a qualified opportunity
zone under section 1400Z-1, and
``(2) which has a poverty rate in excess of 30 percent for
the calendar year prior to the calendar year that includes the
date of enactment of this section.
``(e) Special Rules.--
``(1) Application to united states shareholders of
controlled foreign corporations.--
``(A) In general.--In the case of a domestic
corporation that is a United States shareholder of a
qualified controlled foreign corporation, the credit
under subsection (a) (determined without regard to this
paragraph) shall be increased by an amount equal to 30
percent of the corporation's pro rata share (determined
under rules similar to the rules of section 951(a)(2))
of qualified production activity expenditures of such
controlled foreign corporation for the taxable year of
the qualified controlled foreign corporation ending
with or within the taxable year of the domestic
corporation.
``(B) Qualified corporation.--For purposes of
subparagraph (A), the term `qualified controlled
foreign corporation' means, for any taxable year, a
controlled foreign corporation which does not have
gross income that is effectively connected with the
conduct of a trade or business within the United States
for such taxable year .
``(2) Reduction in basis.--If a credit is determined under
this section with respect to any property by reason of any
qualified production activity expenditures described in
subsection (b)(1)(B), the basis of such property shall be
reduced by the amount of the credit so determined.
``(3) Coordination with other credits.--Any qualified
production activity expenditures taken into account in
determining the amount of the credit under subsection (a) shall
not be taken into account in determining a credit under any
other provision of this chapter.
``(f) Recapture.--
``(1) In general.--If, during any taxable year, property
take into account under subsection (c)(1)(B) is disposed of, or
otherwise ceases to be used by the taxpayer in the active trade
or business of producing qualified pharmaceuticals in
commercial quantities, before the close of the recapture
period, then the tax under this chapter for such taxable year
shall be increased by the recapture percentage of the aggregate
decrease in the credits allowed under section 38 for all prior
taxable years which would have resulted solely from reducing to
zero any credit determined under this section with respect to
such property.
``(2) Recapture percentage.--For purposes of subparagraph
(A), the recapture percentage shall be determined in the same
manner as under section 50(a)(1)(B).
``(3) Application to united states shareholders.--In the
case of any taxpayer to whom a credit is allowed by reason of
subsection (e)(1), paragraph (1) shall be applied by
substituting `the controlled foreign corporation with respect
to which the taxpayer is a United States shareholder' for `the
taxpayer'.
``(4) Application of other rules.--For purposes of this
paragraph, rules similar to the rules of paragraphs (3), (4),
and (5) (other than subparagraph (A) thereof) of section
50(a)(1) shall apply.''.
(b) Credit Allowed Against Alternative Minimum Tax.--Section
38(c)(4)(B) of such Code is amended by redesignating clauses (x), (xi),
and (xii) as clauses (xi), (xii), and (xiii), respectively, and by
inserting after clause (ix) the following new clause:
``(x) the credit determined under section
45U,''.
(c) Credit Allowed Against Base Erosion Anti-Abuse Tax.--Section
59A(b)(1)(B)(ii) of such Code is amended by striking ``plus'' at the
end of subclause (I), by redesignating subclause (II) as subclause
(III), and by inserting after subclause (I) (as so amended) the
following new subclause:
``(II) the credit allowed under
section 38 for the taxable year which
is properly allocable to the distressed
zone pharmaceutical and medical device
production credit determined under
section 45U(a), plus''.
(d) Denial of Deduction.--Section 280C of such Code is amended by
adding at the end the following new subsection:
``(i) Distressed Zone Pharmaceutical and Medical Device Production
Credit.--No deduction shall be allowed for that portion of the
qualified production activity expenditures (as defined in section
45U(b)) otherwise allowable as a deduction for the taxable year which
is equal to the amount of the distressed zone pharmaceutical and
medical device production credit determined for such taxable year under
section 45U(a).''.
(e) Part of General Business Credit.--Section 38(b) of such Code is
amended by striking ``plus'' at the end of paragraph (32), by striking
the period at the end of paragraph (33) and inserting ``, plus'', and
by adding at the end the following new paragraph:
``(34) the distressed zone pharmaceutical and medical
device production credit determined under section 45U(a).''.
(f) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 is amended by adding at the end
the following new item:
``Sec. 45U. Distressed zone pharmaceutical and medical device
production credit.''.
(g) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred after the date of the enactment of
this Act.
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