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                                                       Calendar No. 184
107th Congress                                                   Report
                                 SENATE
 1st Session                                                     107-79

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



 
                 BEST PHARMACEUTICALS FOR CHILDREN ACT

                                _______
                                

                October 4, 2001.--Ordered to be printed

                                _______
                                

   Mr. Kennedy, from the Committee on Health, Education, Labor, and 
                   Pensions, submitted the following

                              R E P O R T

                         [To accompany S. 838]

    The Committee on Health, Education, Labor, and Pensions, to 
which was referred the bill (S. 838) to amend the Federal Food, 
Drug, and Cosmetic Act to improve the safety and efficacy of 
pharmaceuticals for children, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill (as amended) do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and summary of the bill..................................1
 II. Background and need for the legislation..........................3
III. Legislative history and committee action.........................5
 IV. Explanation of legislation and committee views...................7
  V. Cost estimate...................................................11
 VI. Application of law to the legislative branch....................11
VII. Regulatory impact statement.....................................11
VIII.Section-by-section analysis.....................................12

 IX. Changes in existing law.........................................14

                   I. Purpose and Summary of the Bill

    To address a longstanding concern that only 20 percent of 
prescription medications on the market have been tested and 
approved for use in children, Congress enacted a market 
incentive law, commonly referred to as the ``pediatric 
exclusivity'' or ``pediatric testing'' incentive, as part of 
the Food and Drug Administration Modernization Act of 1997 
(FDAMA Pub. L. 105-115). By providing 6 months of additional 
market exclusivity on a drug for a holder of an approved 
application under section 505(b)(1) of the Federal Food, Drug, 
and Cosmetic Act (FFDCA) that has completed pediatric studies 
of the drug when requested by the Food and Drug Administration 
(FDA), Congress sought to find an approach that would be more 
successful than previous efforts to have the pharmaceutical 
industry study the safety and effectiveness in children of 
drugs that, without such studies, would be prescribed ``off-
label'' to children.
    The Best Pharmaceuticals for Children Act, S. 838, is 
designed to continue the successes of and improve upon the 
current pediatric exclusivity law in generating studies of 
medicines for children. Drug companies have studied several 
drugs in children and those drugs now carry appropriate 
pediatric labeling because of the FDAMA pediatric exclusivity 
provision. It remains the case, however, that drug 
manufacturers have tested only 25 percent of medicines in 
children, and so FDA has approved only that small percentage of 
today's drugs for use in children. The FDA, the General 
Accounting office (GAO), and others have issued reports 
describing how highly effective the pediatric exclusivity law 
has been in generating pediatric studies and useful new 
labeling information. They have also, however, expressed 
concerns about areas that need to be improved. This legislation 
seeks to stimulate additional pediatric testing and to provide 
for the testing of off-patent medicines for children, for 
timely labeling changes, and for testing in neonates so that 
they also benefit from additional studies and labeling 
information.

 1. the legislation authorizes the testing of drugs lacking patent or 
                     other exclusivity protections

    The current pediatric testing incentive was not designed to 
stimulate pediatric studies for medicines that lack patent 
terms or other market exclusivities because there is no patent 
or other exclusivity on the drug to which to attach a 6-month 
period of additional market exclusivity. An FDA analysis of 
1994 data found that 6 of 10 drugs most commonly prescribed for 
children were off-patent. This legislation creates an off-
patent research fund to provide for studies of such drugs by 
pediatric pharmacology research units (PPRUs) or other 
entities, after the manufacturers of the drug have declined a 
right of first refusal to conduct the studies of the drug.

2. the legislation provides for timely labeling changes for drugs that 
  are granted exclusivity and that are studied through the off-patent 
                             research fund

    The Prescription Drug User Fee Act (PDUFA), as amended by 
FDAMA, exempts supplements for a new indication for use in 
pediatric populations from the user fee that must ordinarily 
accompany filings with FDA. This provision has meant that 
manufacturers have not paid user fees when they submit their 
reports of studies in response to a request from FDA 
forpediatric studies, as such reports are submitted in the form of 
supplements to their new drug applications. This legislation removes 
this exemption by requiring companies to pay PDUFA fees at the time 
they submit pediatric supplements with reports of their completed 
studies to the FDA. It thereby helps ensure that FDA will have 
sufficient resources to review pediatric labeling supplements as 
``priority supplements.''
    The legislation also provides a procedure for timely 
labeling of branded drugs granted pediatric exclusivity and for 
drugs tested under the off-patent research fund. If a 
manufacturer refuses to make labeling changes requested by FDA, 
the agency must refer the issue to its Pediatric Advisory 
subcommittee of the Anti-Infective Drugs Advisory Committee, 
which then makes a recommendation to the agency about a 
labeling change. After considering this recommendation, FDA may 
request an appropriate labeling change and, if the company 
refuses to make the requested change, the FDA may deem the 
company's drug to be misbranded.

   3. THE LEGISLATION CLARIFIES THAT WRITTEN REQUESTS FOR PEDIATRIC 
             STUDIES MAY INCLUDE NEONATES WHEN APPROPRIATE

    The legislation clarifies that written requests for 
pediatric testing my include neonates (newborns to 1 month old) 
in all appropriate cases.

 4. THE LEGISLATION PROVIDES FOR THE PUBLIC DISSEMINATION OF PEDIATRIC 
           TEST INFORMATION BEFORE LABELING CHANGES ARE MADE

    The legislation requires the FDA to make public a summary 
of the medical and clinical pharmacology reviews of the 
pediatric studies, except that confidential commercial 
information or trade secrets contained in the pediatric 
supplement would not be disclosed.

  5. THE LEGISLATION PROVIDES FOR THE INSTITUTE OF MEDICINE TO REVIEW 
      FEDERAL REGULATIONS, REPORTS AND RESEARCH INVOLVING CHILDREN

    The legislation recognizes the need to review current legal 
and ethical safeguards for children involved in clinical 
research and provides for a study of this matter by the 
Institute of Medicine (IOM). The IOM, with the involvement of 
pediatric experts, must complete its review and report to 
Congress with recommendations in 2 years.

              II. Background and Need for the Legislation

    Although children suffer from many of the same diseases as 
adults and are often treated with the same medicines, the 
pharmaceutical industry has studied and labeled for use in 
children only about 25 percent of today's medicines. Dosing 
children based merely on their lower weight is often imprecise, 
since their bodies can metabolize medicines differently than 
adults. Some drugs may have different adverse side effects or 
toxicities in children than in adults, so estimating dosages 
for children from dosages found to be safe and effective in 
adults may not be appropriate. The lack of pediatric studies 
and labeling information may lead to unintended medical errors 
and place children at risk of being under-dosed or over-dosed 
with medication. The lack of age-appropriate formulations 
(e.g., liquid form) can also make it difficult to give children 
and infants prescribed amounts of a needed medication.
    Before 1997, regulatory efforts to address the lack of 
pediatric studies and insufficient labeling information had 
been largely unsuccessful. In 1979, the FDA first issued a rule 
requiring specific pediatric indications, if any, to be 
described under the ``Indications and Usage'' section of the 
label, with pediatric dose information included in the ``Dosage 
and Administration'' section. The rule also required that 
recommendations for pediatric use must be based on data from 
adequate and well-controlled studies in the pediatric 
population. The 1979 rule did not successfully encourage the 
pharmaceutical industry to conduct pediatric studies and 
appropriately label their products for children. Accordingly, 
in 1994, the FDA published a final rule requiring drug 
manufacturers to survey existing data and to determine whether 
it would support pediatric labeling, and if it did, to file a 
supplemental new drug application. FDA's December 1994 
Pediatric Plan sought to encourage the pharmaceutical industry 
to develop voluntarily pediatric data both during the drug 
development process and after marketing. Neither of these 1994 
initiatives increased substantially the number of drugs with 
adequate pediatric labeling.
    Senators Dodd and Kassebaum first introduced the Better 
Pharmaceuticals for Children Act in the 102nd Congress, and it 
was reintroduced in each subsequent Congress until it was 
enacted in 1997 as part of FDAMA. In the 1997 report on the 
legislation, the committee stated, ``there is little incentive 
for drug sponsors to perform studies for medications which they 
intend to market primarily for adults and whose use in children 
is expected to generate little additional revenue. Pediatric 
studies pose ethical and moral issues relating to using new 
unapproved drugs in young patients. Second, there are 
substantial produce liability and medical malpractice issues. 
Third, pediatric patients are more difficult to attract into 
studies. Fourth, the some drugs, pediatric use represents more 
difficult issues of drug administration and patient compliance 
than adult use.''
    Accordingly, the pediatric exclusivity provision enacted by 
congress in 1997 provides a market incentive of 6 months of 
additional exclusive sales to drug companies for studies of 
medicines in children. Also in 1997, FDA proposed its Pediatric 
rule, which it finalized in 1998, and which became effective 
only 1999. That rule requires the manufacturers of certain new 
and marketed drugs and biological products to provide adequate 
labeling for the use of the products in children. The rule is 
both broader and narrower than the pediatric exclusivity 
provision enacted by congress in 1997. When their scopes 
overlap, Congress provided that pediatric studies required 
under the rule could also satisfy the requirements for market 
exclusivity.
    The incentive provided by 6 months of market exclusivity 
has successfully encouraged drug companies to respond 
affirmatively to most of FDA's requests for pediatric studies. 
Yet the incentive varies widely from drug to drug. For example, 
nearly three quarters, or 27, of the first 37 drugs granted 
exclusivity would have sales in 6 months of less than $150 
million, based on 2000 sales data. The remaining 10 of those 37 
drugs, by contrast, had sales in 6 months over $200 million, 
and 1 of those had sales in 6 months exceeding $2 billion, a 
second had sales exceeding $1.2 billion, and 2 had sales 
exceeding $800 million.
    Because of pediatric exclusivity, FDA had granted 37 drugs 
pediatric exclusivity as of September 7, 2001. The results of 
the pediatric studies have provided new and useful information 
for use of these medicines in children, 19 of which have been 
relabeled to include pediatric information. As of August 6, 
2001, FDA had issued 196 written requests for more than 422 
studies of drugs for anti-inflammatory, cardiovascular, anti-
viral, oncology, neurology, and endocrine, among other, 
diseases and conditions.
    In its January 2001 Status Report to Congress on the 
pediatric exclusivity provision, the FDA wrote:

          The pediatric exclusivity provision has done more to 
        generate clinical studies and useful prescribing 
        information for the pediatric population than any other 
        regulatory or legislative process to date. * * * As a 
        result of the pediatric exclusivity provision and FDA's 
        filing requirement that study reports be submitted in a 
        manner which will result in labeling information for 
        children, critical drugs used to treat a variety of 
        conditions (e.g., gastro intestinal reflux disease, 
        diabetes mellitus, pain, asthma, hypertension) have or 
        soon will have pediatric use information in their 
        labeling.

    The GAO Director for Health Care, Janet Heinrich, testified 
at the committee's May 8, 2001, hearing that, ``[s]ince 
enactment of the pediatric exclusivity provision, both the 
numbers of drugs studied in children and the therapeutic 
classes they represent have substantially increased. Hundreds 
of studies are being done on drugs that are important to 
pediatric patients.'' The pediatric exclusivity law has 
provided for pediatric research on different medicines in the 
same therapeutic class because it is important that children 
have a choice of medicines, as do adults, because some children 
may only tolerate 1 drug in a therapeutic class.
    At a time when the infrastructure is now in place to 
accommodate the increasing pediatric studies, many pediatric 
experts are concerned about the January 1, 2002, sunset date in 
the current law. During the May 8, 2001, committee hearing, the 
GAO stated that, ``Experts agree that, since FDAMA, there also 
has been significant growth in the infrastructure necessary to 
conduct pediatric studies. For example, NICHD [National 
Institute of Child Health and Development] has expanded the 
number of PPRUs from 7 to 13. * * * Prior to FDAMA, the PPRU 
Network had conducted 17 studies for drug sponsors. By 2000, 
the PPRUs were conducting 73 pediatric drug studies for drug 
sponsors. The pharmaceutical industry also has increased its 
capacity to conduct pediatric studies since enactment of 
FDAMA.'' This strong infrastructure for conducting pediatric 
studies will help to ensure the continuing success of this law, 
which has seen the study of a wide range of drugs in many 
therapeutic areas.

             III. Legislative History and Committee Action

    On May 7, 2001, Senators Dodd and DeWine introduced S. 838, 
the ``Best Pharmaceuticals for Children Act.'' On May 8, 2001, 
the committee held a hearing entitled ``Better Pharmaceuticals 
for Children: Assessment and Opportunities.'' In the hearing, 
the committee examined how the 1997 pediatric exclusivity law 
has worked and how it could be improved, so as to determine 
whether and how the provision should be reauthorized.
    On August 1, 2001, the committee held an executive session 
to consider S. 838. Senators Dodd and DeWine offered an 
amendment in the nature of a substitute that the committee 
considered as original text for purposes of further amendment. 
Senators Dodd, Kennedy, and DeWine offered an amendment that 
the committee accepted without objection. Also without 
objection, the committee directed that technical and conforming 
changes be made. The committee approved S. 838, as amended, by 
voice vote.

A. Amendment Adopted Without Objection During Executive Session

    The committee adopted 1 amendment without objection.
    1. Senator Dodd offered an amendment for himself, Senators 
Kennedy and DeWine that clarifies the interaction of pediatric 
market exclusivity under this provision and the market 
exclusivity awarded to an applicant for approval of a drug 
under section 505(j) of the FFDCA. Under the 1997 pediatric 
exclusivity law, Congress created a 6-month market incentive 
for a holder of an approved application under section 505(b)(1) 
of the FFDCA to conduct pediatric studies of a drug FDA's 
request, thereby rewarding companies that invest resources to 
test medicines for children. Under the 1984 Waxman-Hatch Act, 
Congress created a 6-month period of market exclusivity (``ANDA 
exclusivity'') for the first applicant for approval of a drug 
under section 505(j) of the FFDCA to challenge a patent on that 
drug, during which FDA may not approve subsequent abbreviated 
applications for the drug; this incentive rewards the first 
filer of an abbreviated application that pursues the risk and 
expense of challenging a patent.
    When Congress passed the pediatric exclusivity provision in 
1997, it had not meant to change the incentives for challenging 
patents under the Waxman-Hatch Act by reducing periods of ANDA 
exclusivity. The committee has since learned, however, that in 
some instances, pediatric exclusivity on a drug may run over 
all or a portion of the 180 days of ANDA exclusivity for the 
first applicant to challenge a patent on that drug.
    The amendment clarifies how a period of ANDA exclusivity on 
a drug is to be extended when a pediatric exclusivity period on 
the drug overlaps with it. When there is overlap and the period 
of ANDA exclusivity expires after the period of pediatric 
exclusivity, the period of ANDA exclusivity is extended by the 
length of the overlap. When there is overlap and the period of 
ANDA exclusivity expires during the period of pediatric 
exclusivity, the period of ANDA exclusivity is extended by six 
months. The amendment gives the filer of an abbreviated drug 
application who challenges a patent no more and no less time to 
market his drug exclusively before subsequent abbreviated 
applications for the drug may be approved then it would have 
received but for the intervening period of pediatric 
exclusivity.
    For example, the committee understands there may be 
instances in which 2 patents on a drug are challenged in an 
abbreviated new drug application, and that, in subsequent 
litigation, a court holds the first patent to expire to be 
valid and infringed, and the second patent to expire tobe 
invalid. If the section 505(b)(1) drug is granted a period of pediatric 
exclusivity with respect to the first patent, and if the court 
decision, which triggers the beginning of the ANDA exclusivity, falls 
60 days before that period of pediatric exclusivity begins (that is, 60 
days before the first patent will expire), the ANDA exclusivity will 
overlap with the pediatric exclusivity for 120 days. In the absence of 
pediatric exclusivity, the holder of the abbreviated drug application 
would enjoy at most 120 days to market its drug before a subsequent 
abbreviated application for the drug could be approved. But for the 
amendment, because of pediatric exclusivity, the holder of the 
abbreviated drug application would enjoy no ANDA exclusivity, because 
the first 120 days of the pediatric exclusivity period would run over 
the last 120 days of its ANDA exclusivity. The amendment adds 6 months 
to the ANDA exclusivity period, so that the manufacturer of the section 
505(j) drug would enjoy 120 days of ANDA exclusivity after the period 
of pediatric exclusivity expires.

B. Five Amendments Offered and Subsequently Withdrawn

    1. Senator Clinton offered and then withdrew an amendment 
to establish a council on pediatric cancer therapeutics to 
identify, evaluate, and prioritize new and promising oncology 
drugs for use in children, and to require manufacturers to 
include in an application for study of a new drug their intent 
for pediatric studies of the drug and their procedures for 
individual access to the drug.
    2. Senator Bond offered and then withdrew an amendment to 
provide an additional 3 months of exclusivity when a company 
does studies of a drug in a pediatric population not studied 
under the first request for pediatric studies.
    3. Senator Clinton offered and then withdrew an amendment 
to provide that, when a manufacturer does not accept a written 
request from FDA to study a drug, the drug could be studied 
under the process for studying off-patent drugs provided for in 
S. 838.
    4. Senator Clinton offered and then withdrew an amendment 
to provide that drugs that have annual sales of $800 million or 
more would receive 3 months rather than 6 months of pediatric 
exclusivity.
    5. Senator Kennedy offered and then withdrew an amendment 
to require pediatric testing of new drugs for their approved 
uses in adults.

         IV. Explanation of the Legislation and Committee Views


Priority lists of drugs to be studied

    The FDA recommended that the requirement that the Secretary 
create and maintain a priority list of drugs to be studied for 
their pediatric use in children be eliminated. Development of 
the list was resource intensive, and diverted resources from 
other needed work on pediatric drugs. The list also did little 
to prioritize effectively which drugs should be studied in 
children. Finally, the priority list created the mistaken 
impression on the part of some drug manufacturers that only 
those drugs on the list could qualify for the pediatric 
incentive. Accordingly, the legislation has eliminated the 
list.
    At the same time, the legislation establishes a process and 
standard by which the National Institutes of Health (NIH) and 
FDA are to prioritize the study of drugs that lack patents or 
other market exclusivity protections. The committee expects 
that this process and standard for the prioritization of drugs 
will produce a useful priority list for the study of such 
drugs. These drugs will be studied using limited Federal funds, 
and the committee believes that these funds can be used most 
efficiently to study drugs that will provide significant 
benefit to significant numbers of children. The committee 
intends the standards in the legislation to guide the 
prioritization process, so that a rational plan for the study 
of off-patent drugs will emerge.

Fund and process for study of drugs lacking patents and other market 
        exclusivities

    The 1997 pediatric exclusivity law makes no provision for 
the study of drugs lacking patent and other market exclusivity 
protections, as such drugs lack any market exclusivity to which 
the 6-month period of pediatric exclusivity may attach. This 
legislation therefore addresses concerns raised by the FDA, 
GAO, and pediatric groups about the urgent need for pediatric 
studies of such drugs. Data from 1994 showed that 6 of 10 drugs 
most commonly prescribed for children lacked patent terms. By 
creating an off-patent research fund, this legislation creates 
a mechanism for the Secretary to contract with PPRUs and other 
entities that have expertise to conduct pediatric clinical 
trials (universities, hospitals, and, other public or private 
institutions) for studies of an off-patent drug. Under this 
provision, the companies that market the drug would be offered 
the right of first refusal to conduct and fund the studies and, 
if the companies do not respond within 30 days, they would not 
be eligible to receive funds from the off-patent research fund 
to conduct the study. Only the entity awarded a contract by the 
Secretary to perform the study of the off-patent drug would 
have access to public funds in the off-patent research fund.
    Under sections 505(c)(3)(D)(iii) and (iv) and 
505(j)(5)(D)(iii) and (iv) of the FFDCA, a company is eligible 
for three-year Waxman-Hatch exclusivity only if it submits a 
new drug application (NDA) to FDA containing reports of new 
clinical investigations that are essential to approval of the 
application and that are conducted or sponsored by the 
applicant. By regulation, FDA has required that a study is 
``conducted or sponsored by'' a company if (1) the company is 
the sponsor named in the IND for the study submitted to FDA 
(i.e., the company conducts the study), or (2) the company 
provides 50 percent or more of the cost of conducting the 
study. 21 CFR 314.50(j)(4)(iii). Accordingly, if a company 
declines to conduct or sponsor studies of an off-patent drug 
and another entity (such as a PPRU) conducts the studies, it is 
the committee's understanding that the company would not be 
able to benefit from an additional 3 years of Hatch-Waxman 
exclusivity. If the Secretary agrees with an off-patent study 
that shows that a formulation change is necessary, the 
legislation requires that the Secretary send a nonbinding 
letter recommending such formulation change to each holder of 
an approved application for the drug.

Timely labeling of drugs granted exclusivity and of off-patent drugs

    The committee understands that some drug companies have 
been reluctant to relabel their products once pediatric studies 
are complete when the information from the study is adverse. 
The committee believes that all useful and appropriate 
information on the safety and effectiveness of a drug in 
children should appear in drug labeling, and that this 
information should appear in the drug label as soon as 
possible. Pediatricians and parents must have timely access to 
all appropriate information when they are deciding whether and 
how to give a drug to a child.
    Accordingly, the legislation provides a process by which 
FDA can seek labeling changes to drugs granted pediatric 
exclusivity and to of off-patient drugs studied under the off-
patent research fund. The committee intends the process to be a 
reasonably quick and open process, after which the government 
could initiate an enforcement action to require relabeling of 
the drug. The process requires referral to the Pediatric 
Advisory Subcommittee of the Anti-Infective Drugs Advisory 
Committee after a company has refused an FDA request to relabel 
a product. The FDA then makes a second request for a labeling 
change after considering the recommendation of the Pediatric 
Advisory Subcommittee and, if the company refuses to relabel 
its drug, the FDA can deem the drug to be misbranded.
    The committee expects that, generally, the government would 
rely on the injunction provisions of the FFDCA to seek an order 
from the court for the company to label its product with 
appropriate pediatric labeling, not seizure or criminal 
provisions. The committee does not believe that the government 
should routinely seek an order enjoining the company from 
marketing what is a safe and effective drug for use in adults 
merely because it may lack appropriate pediatric labeling.
    The committee believes that the government would make its 
case that a company's drug is misbranded before the court by 
showing that FDA made an initial request for relabeling that 
the company refuse, that FDA referred the issue of the 
Pediatric Advisory Subcommittee, which reviewed the matter and 
made a recommendation about a labeling change to FDA, that FDA 
made a second request for a labeling change, which the company 
refused, and that FDA's second requested labeling change was 
appropriate because without the change the drug would lack 
adequate directions for use in children.
    The committee expects this Pediatric Advisory process to be 
an open one, in that, in accordance with existing law and FDA 
policies and procedures, materials provided to the Pediatric 
Advisory Subcommittee will be made available to the public, 
including by posting the material on the FDA's website. All 
disclosures of information are subject to the Freedom of 
Information Act and the Trade Secrets Act. The committee 
understands that current FDA guidance on the disclosure of 
information provided to an advisory committee can be found in 
the following FDA Guidance Documents: ``Disclosure of Materials 
Provided to Advisory Committee in Connection with Open Advisory 
Committees Convened by the Center for Drug Evaluation and 
Research Beginning on January 1, 2000'' (Nov. 1999), and 
``Disclosing Information Provided to Advisory Committees in 
Connection with Open Advisory Committee Meetings Related to the 
Testing or Approval of New Drugs and Convened by the Center for 
Drug Evaluation and Research, Beginning on January 1, 2000'' 
(Dec. 1999).
    As an additional means to provide for timely pediatric 
labeling changes on drugs, the legislation removes the 
exemption for pediatric indication supplements in PDUFA that 
excludes companies that perform pediatric drug studies at FDA's 
request from paying a user fee. By requiring that drug 
companies pay PDUFA fees when they submit their completed 
studies as supplements to the FDA, the committee expects that 
FDA will have sufficient resources to review pediatric labeling 
supplements quickly as ``priority supplements,'' and that 
pediatric labeling changes can be made as quickly as possible.

Pediatric expertise at FDA

    The committee is aware that the incentives created by the 
pediatric exclusivity provision have encouraged the drug 
industry to develop and expand its infrastructure and expertise 
in the study of drugs in pediatrics. The committee intends that 
both the payment of user fees for the review of pediatric 
labeling supplements and the establishment of an Office of 
Pediatric Therapeutics at FDA will facilities similar gains in 
coordinated expertise and infrastructure at FDA.

Pediatric studies in neonates

    The committee understands that, at times, FDA has awarded 
pediatric exclusivity without requesting studies in neonates 
(newborns less than a month old), often because study in 
neonates must follow studies in older children for scientific, 
medical, or ethical reasons. This practice recognizes that 
neonates are an especially vulnerable population and should be 
tested only with the highest regard for their safe and ethical 
treatment. For the same reasons, however, it is important that 
drugs be studied in neonates whenever appropriate; otherwise, 
any use in neonates will be unguided by the knowledge that 
could be appropriately gained in high quality clinical trials 
using neonates. The legislation therefore emphasizes that 
neonate testing should be included in a written request by FDA 
in appropriate cases.
    The committee is not mandating that neonate studies be 
done. Nor does the committee intend this change to mean that 
neonate testing should be performed prematurely. However, it 
does intend that FDA will have broad discretion to structure 
its requests for pediatric trials so as to protect children and 
enhance the value of the information obtained through pediatric 
studies. For example, the committee intends that, if FDA 
concludes that it would be appropriate to conduct neonatal 
studies after it has had the opportunity to examine data from 
studies in older children, FDA may, in 1 written request for 
pediatric studies, request the submission of a report from 
studies in older children, to be followed by studies in younger 
children and neonates if the data from the earlier studies may 
allow appropriate studies in the younger children.

Dissemination of pediatric information

    The committee believes that public dissemination of 
information about pediatric drugstudies will facilitate 
improved understanding and use of drugs in children. The legislation 
accomplishes this goal by requiring that, subject to the Freedom of 
Information Act and the Trade Secrets Act, the FDA make public a 
summary of the medical and clinical pharmacology reviews of the 
pediatric studies, including by publication in the Federal Register. 
Confidential commercial information or trade secrets contained in the 
pediatric supplement could not be disclosed and would have to be 
redacted from any information released to the public.

Study of research involving children

    The pediatric exclusivity provision has increased 
significantly the number of drug studies conducted in children. 
This increase, coupled with reports of unrelated incidents that 
have raised concern about human subject protection, has led 
some to request a thorough examination of safety and ethical 
controls on pediatric studies. The committee shares the concern 
that the ethical conduct of pediatric research and the safety 
of children be paramount. The legislation therefore requires 
that the IOM conduct a 2-year study of Federal regulations and 
reports to assess the adequacy of current legal and ethical 
safeguards. The committee expects the IOM to conduct an 
independent review and to consider a number of options to 
improve current legal and ethical safeguards, including those 
proposed in the May 2001 review by the Department of Health and 
Human Services mandated in the Children's Health Act of 2000 
(P.L. 106-310).

                            V. Cost Estimate

    Due to time constraints the Congressional Budget Office 
estimate was not included in the report. When received by the 
committee, it will appear in the Congressional Record at a 
later time.

            VI. Application of Law to the Legislative Branch

    The Best Pharmaceuticals for Children Act reauthorizes and 
amends the section 505A of the Federal Food, Drug, and Cosmetic 
Act to further improve the safety and efficacy of 
pharmaceuticals for children. It also provides for the study of 
off-patent drugs by amending the Public Health Service Act. As 
such, it has no application to the legislative branch.

                    VII. Regulatory Impact Statement

    By granting drug manufacturers a 6-month extension of 
market exclusivity for a drug upon satisfactory completion of 
requested pediatric studies of the product and delaying the 
availability of lower cost generic alternatives, the bill will 
make those prescription drugs, when provided under Medicaid, 
more expensive. This provision would not constitute a mandate 
under the Unfunded Mandates Reform Act because prescription 
drugs under Medicaid are provided at a State's option. In 
addition, there would be cost savings to the Medicaid program 
because, for example, safe and effective use of drugs in 
children is expected to reduce the need to hospitalize many 
children and to reduce errors in dosing and medicating 
children. The private sector is affected by the bill because it 
increases the nation's annual pharmaceutical bill by one half 
of one percent. There would also be cost savings to the private 
sector by, for example, the reduced need for hospitalization of 
children and reduced errors in medicating children. FDA 
calculated the aggregate increased cost of drugs from pediatric 
exclusivity to be $695 million per year in undiscounted dollars 
and it estimated the direct medical cost savings from reduced 
hospitalizations of children for just 5 illnesses to be $228 
million annually.

                   VIII. Section-by-Section Analysis


Sec. 1. Short title

Sec. 2. Pediatric studies of already-marketed drugs

    Section 2 deletes the requirement that the Secretary 
develop a priority list of on-patent drugs for which additional 
pediatric information may be beneficial. It provides that a 
drug may qualify for a written request for pediatric studies if 
the Secretary determines that information relating to the use 
of an approved drug in the pediatric population may produce 
health benefits in that population.

Sec. 3. Research fund for the study of drugs lacking exclusivity

    Section 3 creates a research fund for the pediatric studies 
of off-patent drugs, authorized at $200 million for FY 2002 
(and such sums for each of the next 5 years), to be 
administered by the National Institutes of Health (NIH). The 
Secretary, acting through the Director of NIH in consultation 
with the Commissioner of Food ad Drugs, would establish a 
prioritized list of off-patent drugs that need to be tested for 
children. Drugs would be prioritized considering the 
availability of information on safe and effective use of the 
drug in children, whether additional information is needed, 
whether new pediatric studies of the drug may produce health 
benefits for children, and whether a reformulation of the drug 
is necessary.
    Section 3 specifies the process for contracts for the 
studies and labeling of drugs lacking patent and other market 
exclusivity protection. The Commissioner of Food and Drugs, in 
consultation with the Director of NIH, would issue a written 
request for pediatric studies of such a drug to all companies 
that produce the drug. If a company accepts, then that company 
would pay for the study and perform the study pursuant to the 
requirements stated in the FDA's written request. If no company 
responds within 30 days to the written request (or if companies 
decline to perform the study), the Secretary must publish a 
request for contract proposals to conduct the pediatric studies 
described in the written request. If the Secretary is able to 
enter into a satisfactory contract for the studies, and once 
the contractor completes the study, the contractor must submit 
a report, including all data generated by the study, to the 
Director and the Commissioner, and the report must then be made 
available to the public.
    Within 180 days of submission of the report, the 
Commissioner must review the data and negotiate labeling 
changes with the drug's manufacturer indicating the labeling 
change sought by the Commissioner. The Commissioner must place 
a copy of the report and any requested labeling changes sought 
in a public docket file, and must publish a summary of the 
report and the requested labeling changes in the Federal 
Register. If a company refuses to make the labeling changes 
sought by the Commissioner with 180 days of submission of the 
report, theCommissioner must immediately refer the report, 
data, and labeling change request to the Pediatric Advisory 
Subcommittee of the Anti-Infective Drug Advisory Committee. The 
Pediatric Advisory Subcommittee then has 90 days to review the report, 
data, and labeling change request and recommend to the Commissioner 
appropriate labeling changes. The Commissioner would then have 30 days 
to consider the Subcommittee's recommendation, and then make a final 
request to the drug company regarding a labeling change. If the drug 
company fails to agree to the labeling changes within 30 days, the 
Commissioner may deem the drug to be misbranded under the FEDCA. If the 
pediatric studies indicate that formulation change is necessary (from a 
pill to a liquid form, for example), the Secretary must send a 
nonbinding letter of recommendation for such a formulation change to 
all drug companies that market the drug.

Sec. 4. Timely labeling changes for drugs granted exclusivity; drug 
        fees

    Section 4 requires drug companies to pay user fees at the 
time they submit their completed studies to the FDA. Payment of 
user fees would then trigger the PDUFA ``priority supplement'' 
goal of 6 months for FDA to review pediatric labeling 
supplements submitted by the company. Within 180 days of 
submission of the report, the Commissioner of Food and Drugs 
must request whatever labeling changes he deems appropriate. If 
the drug company does not agree within that 180-day period to 
make the changes sought by the FDA, then the Commissioner must 
immediately refer the matter to the agency's Pediatric Advisory 
Subcommittee. Within 90 days, the Pediatric Advisory 
Subcommittee must review the pediatric study reports and make a 
recommendation to the Commissioner as to appropriate labeling 
changes. Within 30 days, the Commissioner must consider the 
recommendations of the Subcommittee and make a final request to 
the drug company for a labeling change. If the drug company 
does not agree with 30 days to this labeling change request 
from the Commissioner, the Commissioner may deem the drug 
misbranded.

Sec. 5. Office of Pediatric Therapeutics

    Section 5 requires the Secretary to establish an Office of 
Pediatric Therapeutics within the FDA. This office would 
oversee and coordinate RDA activities that could have an effect 
on pediatrics. The office would include 1 or more people with 
expertise in pediatric ethics and 1 or more people with 
pediatric expertise to consult on FDA activities that might 
have an effect on pediatrics.

Sec. 6. Neonates

    Section 6 clarifies that the pediatric age groups in which 
pediatric studies are to be performed in response to requests 
for such studies by FDA should include neonates when their 
inclusion is appropriate.

Sec. 7. Sunset

    Section 7 sunsets the billion October 1, 2007, and provides 
that a drug may receive pediatric exclusivity if, before that 
date, the Secretary makes a written request for pediatric 
studies of the drug and an approvable application for the drug 
has been submitted, and all requirements of section 505A of the 
FFDCA are met.

Sec. 8. Dissemination of pediatric information

    Section 8 requires that, within 6 months after a drug 
manufacturer has submitted a pediatric labeling change 
supplement to the FDA, the FDA must make public a summary of 
the medical and clinical pharmacology reviews of the pediatric 
studies, including by publication in the Federal Register. All 
disclosures of information are subject to the Freedom of 
Information Act and the Trade Secrets Act.

Sec. 9. Clarification of interaction of market exclusivity under 
        section 505 of the Federal Food, Drug, and Cosmetic Act and 
        market exclusivity awarded to an applicant for approval of a 
        drug under section 505(j) of that act

    Section 9 clarifies the interaction of pediatric 
exclusivity provided under this legislation with ANDA 
exclusivity awarded under the Waxman-Hatch Law. It specifies 
that, when the pediatric exclusivity period for a drug overlaps 
with a period of ANDA exclusivity for the drug, the period of 
ANDA exclusivity is extended by an amount necessary to ensure 
that the holder of ANDA exclusivity enjoys the same possibility 
of exclusive commercial marketing that the holder would have 
enjoyed in the absence of pediatric exclusivity, no more and no 
less.

Sec. 10. Study concerning research involving children

    Section 10 requires the Secretary to contract with the IOM 
to conduct a 2-year study of Federal regulations involving 
children in research; the written and oral processes for 
obtaining ``assent, permission,and informed consent'' of 
children in research from parents, guardians, and legal 
representatives; the definition of ``minimal risk'' with 
respect to children with illnesses or health children; the 
appropriateness of regulations applicable to children of 
differing ages and maturity; financial (or other) incentives 
that are or may be offered; the monitoring and enforcement of 
violations of existing regulations; the roles and 
responsibilities of institutional review boards (IRBs) in 
reviewing research involving children; and the composition of 
membership of such IRBs.

Sec. 11. Technical and conforming amendments

                      IX. Changes in Existing Law

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

                       PUBLIC HEALTH SERVICE ACT

           *       *       *       *       *       *       *



                 TITLE IV--NATIONAL RESEARCH INSTITUTES


                 Part A--National Institutes of Health


           organization of the national institutes of health

    Sec. 401. [281] (a) * * * 

           *       *       *       *       *       *       *


SEC. [409C.] 409G. CLINICAL RESEARCH.

    (a) In General.--The director of National Institutes of 
Health shall undertake activities to support and expand the 
involvement of the National Institutes of Health in clinical 
research.
    (b) Requirements.--In carrying out subsection (a), the 
Director of National Institutes of Health Shall--
          (1) consider the recommendations of the Division of 
        Research Grants Clinical Research Study Group and other 
        recommendations for enhancing clinical research; and
          (2) establish intramural and extramural clinical 
        research fellowship programs directed specifically at 
        medical and dental students and a continuing education 
        clinical research training program at the National 
        Institutes of Health.
    (c) Support for the Diverse Needs of Clinical Research.--
The Director of National Institutes of health, in cooperation 
with the Directors of the Institutes, Centers, and Divisions of 
the National Institutes of Health, shall support and expand the 
resources available for the diverse needs of the clinical 
research community, including inpatient, outpatient, and 
critical care clinical research.
    (d) Peer Review.--The Director of National Institutes of 
Health shall establish peer review mechanisms to evaluate 
applications for the awards and fellowships provided for in 
subsection (b)(2) and section 409D. Such review mechanisms 
shall include individuals who are exceptionally qualified to 
appraise the merits of potential clinical research training and 
research grant proposals.

SEC. [409D.] 409H. ENHANCEMENT AWARDS.

    (a) Mentored Patient-Oriented Research Career Development 
Awards.--
          (1) Grants.--
                  (A) In general.--The Director of the National 
                Institutes of Health shall make grants (to be 
                referred to as ``Mentored Patient-Oriented 
                Research Career Development Awards'') to 
                support individual careers in clinical research 
                at general clinical research centers or at 
                other institutions that have the infrastructure 
                and resources deemed appropriate for conducting 
                patient-oriented clinical research.
                  (B) Use.--Grants under subparagraph (A) shall 
                be used to support clinical investigators in 
                the early phases of their independent careers 
                by providing salary and such other support for 
                a period of supervised study.
          (2) Applications.--An application for a grant under 
        this subsection shall be submitted by an individual 
        scientist at such time as the Director may require.
          (3) Authorization of appropriations.--For the purpose 
        of carrying out this subsection, there are authorized 
        to be appropriated such sums as may be necessary for 
        each fiscal year.
    (b) Mid-Career Investigator Awards in Patient-Oriented 
Research.--
          (1) Grants.--
                  (A) In general.--The Director of the National 
                Institutes of Health shall make grants (to be 
                referred to as ``Mid-Career Investigator Awards 
                in Patient-Oriented Research'') to support 
                individual clinical research projects at 
                general clinical research centers or at other 
                institutions that have the infrastructure and 
                resources deemed appropriate for conducting 
                patient-oriented clinical research.
                  (B) Use.--Grants under subparagraph (A) shall 
                be used to provide support for mid-career level 
                clinicians to allow such clinicians to devote 
                time to clinical research and to act as mentors 
                for beginning clinical investigators.
          (2) Applications.--An application for a grant under 
        this subsection shall be submitted by an individual 
        scientists at such time as the Director requires.
          (3) Authorization of appropriations.--For the purpose 
        of carrying out this subsection, there are authorized 
        to be appropriated such sums as may be necessary for 
        each fiscal year.
    (c) Graduate Training in Clinical Investigation Award.--
          (1) In general.--The Director of the National 
        Institutes of Health shall make grants (to be referred 
        to as ``Graduate Training in Clinical Investigation 
        Awards'') to support individuals pursuing master's or 
        doctoral degrees in clinical investigation.
          (2) Applications.--An application for a grant under 
        this subsection shall be submitted by an individual 
        scientist at such time as the Director may require.
          (3) Limitations.--Grants under this subsection shall 
        be for terms of 2 years or more and shall provide 
        stipend, tuition, and institutional support for 
        individual advanced degree programs in clinical 
        investigation.
          (4) Definition.--As used in this subsection, the term 
        ``advanced degree programs in clinical investigation'' 
        means programs that award a master's or Ph.D degree in 
        clinical investigation after 2 years of training in 
        areas such as the following:
                  (A) Analytical methods, biostatistics, and 
                study design.
                  (B) Principles of clinical pharmacology and 
                pharmacokinetics.
                  (C) Clinical epidemiology.
                  (D) Computer data management and medical 
                informatics.
                  (E) Ethical and regulatory issues.
                  (F) Biomedical writing.
          (5) Authorization of appropriations.--For the purpose 
        of carrying out this subsection, there are authorized 
        to be appropriated such sums as may be necessary for 
        each fiscal year.
    (d) Clinical Research Curriculum Awards.--
          (1) In general.--The Director of the National 
        Institutes of Health shall make grants (to be referred 
        to as ``Clinical Research Curriculum Awards'') to 
        institutions for the development and support of 
        programs of core curricula for training clinical 
        investigators, including medical students. Such core 
        curricula may include training in areas such as the 
        following:
                  (A) Analytical methods, biostatistics, and 
                study design.
                  (B) Principles of clinical pharmacology and 
                pharmacokinetics.
                  (C) Clinical epidemiology.
                  (D) Computer data management and medical 
                informatics.
                  (E) Ethical and regulatory issues.
                  (F) Biomedical writing.
          (2) Applications.--An application for a grant under 
        this subsection shall be submitted by an individual 
        institution or a consortium of institutions at such 
        time as the Director may require. An institution may 
        submit only one such application.
          (3) Limitations.--Grants under this subsection shall 
        be for terms of up to 5 years and may be renewable.
          (4) Authorization of appropriations.--For the purpose 
        of carrying out this subsection, there are authorized 
        to be appropriated such sums as may be necessary for 
        each fiscal year.

SEC. 409I. PROGRAM FOR PEDIATRIC STUDIES OF DRUGS LACKING EXCLUSIVITY.

    (a) List of Drugs Lacking Exclusivity for Which Pediatric 
Studies Are Needed.--
          (1) In general.--Not later than 1 year after the date 
        of enactment of this section, the Secretary, acting 
        through the Director of the National Institutes of 
        Health and in consultation with the Commissioner of 
        Food and Drugs and experts in pediatric research, shall 
        develop, prioritize, and publish an annual list of 
        approved drugs for which--
                  (A)(i) there is an approved application under 
                section 505(j) of the Federal Food, Drug, and 
                Cosmetic Act (21 U.S.C. 355(j));
                  (ii) there is a submitted application that 
                could be approved under the criteria of section 
                505(j) of the Federal Food, Drug, and Cosmetic 
                Act (21 U.S.C. 355(j)); or
                  (iii) there is no patent protection or market 
                exclusivity protection under the Federal Food, 
                Drug, and Cosmetic Act (21 U.S.C. 301 et seq.); 
                and
                  (B) additional studies are needed to assess 
                the safety and effectiveness of the use of the 
                drug in the pediatric population.
          (2) Consideration of available information.--In 
        developing the list under paragraph (1), the Secretary 
        shall consider, for each drug on the list--
                  (A) the availability of information 
                concerning the safe and effective use of the 
                drug in the pediatric population;
                  (B) whether additional information is needed;
                  (C) whether new pediatric studies concerning 
                the drug may produce health benefits in the 
                pediatric population; and
                  (D) whether reformulation of the drug is 
                necessary;
    (b) Contracts for Pediatric Studies.--The Secretary shall 
award contracts to entities that have the expertise to conduct 
pediatric clinical trials (including qualified universities, 
hospitals, laboratories, contract research organizations, 
federally funded programs such as pediatric pharmacology 
research units, other public or private institutions, or 
individuals) to enable the entities to conduct pediatric 
studies concerning one or more drugs identified in the list 
described in subsection (a).
    (c) Process for Contracts and Labeling Changes.--
          (1) Written request to holders of approved 
        applications for drugs lacking exclusivity.--
                  (A) In general.--The Commissioner of Food and 
                Drugs, in consultation with the Director of 
                National Institutes of Health, may issue a 
                written request (which shall include a 
                timeframe for negotiations for an agreement) 
                for pediatric studies concerning a drug 
                identified in the list described in subsection 
                (a) to all holders of an approved application 
                for the drug under section 505 of the Federal 
                Food, Drug, and Cosmetic Act. Such a request 
                shall be made in accordance with section 505A 
                of the Federal Food, Drug, and Cosmetic Act.
                  (B) Publication of request.--If the 
                Commissioner of Food and Drugs does not receive 
                a response to a written request issued under 
                subparagraph (A) within 30 days of the date on 
                which a request was issued, the Secretary, 
                acting through the Director of National 
                Institutes of Health and in consultation with 
                the Commissioner of Food and Drugs, shall 
                publish a request for contract proposals to 
                conduct the pediatric studies described in the 
                written request.
                  (C) Disqualification.--A holder that receives 
                a first right of refusal shall not be entitled 
                to respond to a request for contract proposals 
                under subparagraph (B).
                  (D) Guidance.--Not later than 270 days after 
                the date of enactment of this section, the 
                Commissioner of Food and Drugs shall promulgate 
                guidance to establish the process for the 
                submission of responses to written requests 
                under subparagraph (A).
          (2) Contracts.--A contract under this section may be 
        awarded only if a proposal for the contract is 
        submitted to the Secretary in such form and manner, and 
        containing such agreements, assurances, and information 
        as the Secretary determines to be necessary to carry 
        out this section.
          (3) Reporting of studies.--
                  (A) Upon completion of a pediatric study in 
                accordance with a contract awarded under this 
                section, a report concerning the study shall be 
                submitted to the Director of National 
                Institutes of Health and the Commissioner of 
                Food and Drugs. The report shall include all 
                data generated in connection with the study.
                  (B) Availability of reports.--Each report 
                submitted under subparagraph (a) shall be 
                considered to be in the public domain, and 
                shall be assigned a docket number by the 
                Commissioner of Food and Drugs. An interested 
                person may submit written comments concerning 
                such pediatric studies to the Commissioner of Food 
                and Drugs, and the written comments shall become 
                part of the docket file with respect to each of 
                the drugs.
                  (C) Action by commissioner.--The Commissioner 
                of Food and Drugs shall take appropriate action 
                in response to the reports submitted under 
                subparagraph (A) in accordance with paragraph 
                (4).
          (4) Request for labeling changes.--During the 180-day 
        period after the date on which a report is submitted 
        under paragraph (3)(A), the Commissioner of Food and 
        Drugs shall--
                  (A) review the report and such other data as 
                are available concerning the safe and effective 
                use in the pediatric population of the drug 
                studied; and
                  (B) negotiate with the holders of approved 
                applications for the drug studied for any 
                labeling changes that the Commissioner of Food 
                and Drugs determines to be appropriate and 
                requests the holders to make; and
                  (C)(i) place in the public docket file a copy 
                of the report and of any requested labeling 
                changes; and
                  (ii) publish in the Federal Register a 
                summary of the report and a copy of any 
                requested labeling changes.
          (5) Dispute resolution.--If, not later than the end 
        of the 180-day period specified in paragraph (4), the 
        holder of an approved application for the drug involved 
        does not agree to any labeling change requested by the 
        Commissioner of Food and Drugs under that paragraph--
                  (A) the Commissioner of Food and Drugs shall 
                immediately refer the request to the Pediatric 
                Advisory Subcommittee of the Anti-Infective 
                Drugs Advisory Committee; and
                  (B) not later than 90 days after receiving 
                the referral, the Subcommittee shall--
                          (i) review the available information 
                        on the safe and effective use of the 
                        drug in the pediatric population, 
                        including study reports submitted under 
                        this section; and
                          (ii) make a recommendation to the 
                        Commissioner of Food and Drugs as to 
                        appropriate labeling changes, if any.
          (6) FDA determination.--Not later than 30 days after 
        receiving a recommendation from the Sub-committee under 
        paragraph (5)B(ii) with respect to a drug, the 
        Commissioner of Food and Drugs shall consider the 
        recommendation and, if appropriate, make a request to 
        the holders of approved applications for the drug to 
        make any labeling change that the Commissioner of Food 
        and Drugs determines to be appropriate.
          (7) Failure to agree.--If a holder of an approved 
        application for a drug, within 30 days after receiving 
        a request to make a labeling change under paragraph 
        (6), does not agree to make a requested labeling 
        change, the Commissioner may deem the drug to be 
        misbranded under the Federal Food, Drug, and Cosmetic 
        Act.
          (8) Recommendation for formulation changes.--If a 
        pediatric study completed under public contract 
        indicates that a formulation change is necessary and 
        the Secretary agrees, the Secretary shall send a 
        nonbinding letter of recommendation regarding that 
        change to each holder of an approved application.
    (d) Authorization of Appropriations.--
          (1) In general.--There are authorized to be 
        appropriated to carry out this section--
                  (A) $200,000,000 for fiscal year 2002; and
                  (B) such sums as are necessary for each of 
                the 5 succeeding fiscal years.
          (2) Availability.--Any amount appropriated under 
        paragraph (1) shall remain available to carry out this 
        section until expended.

           *       *       *       *       *       *       *


                 FEDERAL FOOD, DRUG, AND COSMETIC ACT

           *       *       *       *       *       *       *



                        CHAPTER II--DEFINITIONS

    Sec. 201 [21 U.S.C. 321] For the purposes of this Act--
    (a)(1) * * *

           *       *       *       *       *       *       *

    (kk) Priority Supplement.--The term ``priority supplement'' 
means a drug application referred to in section 101(4) of the 
Food and Drug Administration Modernization Act of 1997 (111 
Stat. 2298).

           *       *       *       *       *       *       *


SEC. 505A. [21 U.S.C. 355A] PEDIATRIC STUDIES OF DRUGS.

    [(g)] (a) Definitions.--As used in this section, the term 
``pediatric studies'' or ``studies'' means at least one 
clinical investigation (that, at the Secretary's discretion, 
may include pharmacokinetic studies) in pediatric age groups 
(including neonates in appropriate cases) in which a drug is 
anticipated to be used.
    [(a)] (b) Market Exclusivity for New Drugs.--If, prior to 
approval of an application that is submitted under section 
505(b)(1), the Secretary determines that information relating 
to the use of a new drug in the pediatric population may 
produce health benefits in that population, the Secretary makes 
a written request for pediatric studies (which shall include a 
timeframe for completing such studies), and such studies are 
completed within any such time-frame and the reports thereof 
submitted in accordance with subsection (d)(2) or accepted in 
accordance with subsection (d)(3)--
          (1)(A)(i) the period referred to in subsection 
        (c)(3)(D)(ii) of section 505, and in subsection 
        [(j)(4)(D)(ii)] (j)(5)(D)(ii) of such section, is 
        deemed to be five years and six months rather than five 
        years, and the references in subsections (c)(3)(D)(ii) 
        and [(j)(4)(D)(ii)] (j)(5)(D)(ii) of such section to 
        four years, to forty-eight months, and to seven and 
        one-half years are deemed to be four and one-half 
        years, fifty-four months, and eight years, 
        respectively; or
          (ii) the period referred to in clauses (iii) and (iv) 
        of subsection (c)(3)(D) of such section, and in clauses 
        (iii) and (iv) of subsection [(j)(4)(D)] (j)(5)(D) of 
        such section, is deemed to be three years and six 
        months rather than three years; and
          (B) if the drug is designated under section 526 for a 
        rare disease or condition, the period referred to in 
        section 527(a) is deemed to be seven years and six 
        months rather than seven years; and
          (2)(A) if the drug is the subject of--
                  (i) a listed patent for which a certification 
                has been submitted under subsection 
                (b)(2)(A)(ii) or (j)(2)(A)(vii)(II) of section 
                505 and for which pediatric studies were 
                submitted prior to the expiration of the patent 
                (including any patent extensions); or
                  (ii) a listed patent for which a 
                certification has been submitted under 
                subsections (b)(2)(A)(iii) or 
                (j)(2)(A)(vii)(III) of section 505,
        the period during which an application may not be 
        approved under section 505(c)(3) or section 
        [505(j)(4)(B)] shall be extended by a period of six 
        months after the date the patent expires (including any 
        patent extensions); or
          (B) if the drug is the subject of a listed patent for 
        which a certification has been submitted under 
        subsection (b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) of 
        section 505, and in the patent infringement litigation 
        resulting from the certification the court determines 
        that the patent is valid and would be infringed, the 
        period during which an application may not be approved 
        under section 505(c)(3) or section 505(j)(4)(B) shall 
        be extended by a period of six months after the date 
        the patent expires (including any patent extensions).
    [(b) Secretary To Develop List of Drugs for Which 
Additional Pediatric Information May Be Beneficial.--Not later 
than 180 days after the date of enactment of the Food and Drug 
Administration Modernization Act of 1997, the Secretary, after 
consultation with experts in pediatric research shall develop, 
prioritize, and publish an initial list of approved drugs for 
which additional pediatric information may produce health 
benefits in the pediatric population. The Secretary shall 
annually update the list.]
    (c) Market Exclusivity for Already-Marketed Drugs.--If the 
Secretary determines that information relating to the use of an 
approved drug in the pediatric population may produce health 
benefits in that population and makes a written request to the 
holder of an approved application under section 505(b)(1) for 
pediatric studies (which shall include a timeframe for 
completing such studies) [concerning a drug identified in the 
list described in subsection (b)], the holder agrees to the 
request, the studies are completed within any such timeframe, 
and the reports thereof are submitted in accordance with 
subsection (d)(2) or accepted in accordance with subsection 
(d)(3)--
          (1)(A)(i) the period referred to in the subsection 
        (c)(3)(D)(ii) of section 505, and in subsection 
        [(j)(4)(D)(ii)] (j)(5)(D)(ii) of such section, is 
        deemed to be five years and six months rather than five 
        years, and the references in subsections (c)(3)(D)(ii) 
        and [(j)(4)(D)(ii)] (j)(5)(D)(ii) of such section for 
        four years, to forty-eight months, and to seven and 
        one-half years are deemed to be four and one-half 
        years, fifty-four months, and eight years, 
        respectively; or
          (ii) the period referred to the clauses (iii) and 
        (iv) of subsection (c)(3)(D) of such section, and in 
        clauses (iii) and (iv) of subsection [(j)(4)(D)] 
        (j)(5)(D) of such section, is deemed to be three years 
        and six months rather than three years; and
          (B) if the drug is designated under section 526 for a 
        rare disease or condition, the period referred to in 
        section 527(a) is deemed to be seven years and six 
        months rather than seven years; and
          (2)(A) if the drug is the subject of--
                  (i) a listed patent for which a certification 
                has been submitted under subsection 
                (b)(2)(A)(ii) or (j)(2)(A)(vii)(II) of section 
                505 and for which pediatric studies were 
                submitted prior to the expiration of the patent 
                (including any patent extensions); or
                  (ii) a listed patent for which a 
                certification has been submitted under 
                subsection (b)(2)(A)(iii) or 
                (j)(2)(A)(vii)(III) of section 505,
        the period during which an application may not be 
        approved under section 505(c)(3) or section 
        505(j)(4)(B) shall be extended by a period of six 
        months after the date the patent expires (including any 
        patent extensions); or
          (B) if the drug is the subject of a listed patent for 
        which a certification has been submitted under 
        subsection (b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) of 
        section 505, and in the patent infringement litigation 
        resulting from the certification the court determines 
        that the patent is valid and would be infringed, the 
        period during an application may not be approved under 
        section 505(c)(3) or section 505(j)(4)(B) shall be 
        extended by a period of six months after the date the 
        patent expires (including any patent extensions).
    (d) Conduct of Pediatric Studies.--
          (1) Agreement for studies.--The Secretary may, 
        pursuant to a written request from the Secretary under 
        subsection [(a) or (c)] (b) or (c), after consultation 
        with--
                  (A) the sponsor of an application for an 
                investigational new drug under section 505(i);
                  (B) the sponsor of an application for a new 
                drug under section 505(b)(1); or
                  (C) the holder of an approved application for 
                a drug under section 505(b)(1),
        agree with the sponsor or holder for the conduct of 
        pediatric studies for such drug. Such agreement shall 
        be in writing and shall include a timeframe for such 
        studies.
          (2) Written protocols to meet the studies 
        requirement.--If the sponsor or holder and the 
        Secretary agree upon written protocols for the studies, 
        the studies requirement of subsection [(a) or (c)] (b) 
        or (c) is satisfied upon the completion of the studies 
        and submission of the reports thereof in accordance 
        with the original written request and the written 
        agreement referred to in paragraph (1). Not later than 
        60 days after the submission of the report of the 
        studies, the Secretary shall determine if such studies 
        were or were not conducted in accordance with the 
        original written request and the written agreement and 
        reported in accordance with the requirements of the 
        Secretary for filing and so notify the sponsor or 
        holder.
          (3) Other methods to meet the studies requirement.--
        If the sponsor or holder and the Secretary have not 
        agreed in writing on the protocols for the studies, the 
        studies requirement of subsection [(a) or (c)] (b) or 
        (c) is satisfied when such studies have been completed 
        and the reports accepted by the Secretary. Not later 
        than 90 days after the submission of the reports of the 
        studies, the Secretary shall accept or reject such 
        reports and so notify the sponsor or holder. The 
        Secretary's only responsibility in accepting or 
        rejecting the reports shall be to determine, within the 
        90 days, whether the studies fairly respond to the 
        written request, have been conducted in accordance with 
        commonly accepted scientific principles and protocols, 
        and have been reported in accordance with the 
        requirements of the Secretary for filing.
    (e) Delay of Effective Date for Certain Application.--If 
the Secretary determines that the acceptance or approval of an 
application under section 505(b)(2) or 505(j) for a new drug 
may occur after submission of reports of pediatric studies 
under this section, which were submitted prior to the 
expiration of the patent (including any patent extension) or 
the applicable period under clauses (ii) through (iv) of 
section 505(c)(3)(D) or clauses (ii) through (iv) of section, 
[505(j)(4)(D)] 505(j)(5)(D), but before the Secretary has 
determined whether the requirements of subsection (d) have been 
satisfied, the Secretary shall delay the acceptance or approval 
under section 505(b)(2) or 505(j) until the determination under 
subsection (d) is made, but any such delay shall not exceed 90 
days. In the event that requirements of this section are 
satisfied, the applicable six-month period under subsection 
[(a) or (c)] (b) or (c) shall be deemed to have been running 
during the period of delay.
    (f) Notice of Determinations on Studies Requirement.--The 
Secretary shall publish a notice of any determination that the 
requirements of subsection (d) have been met and that 
submissions and approvals under subsection (b)(2) or (j) of 
section 505 for a drug will be subject to the provisions of 
this section.
    [(h)] (g) Limitations.--A drug to which the six-month 
period under subsection [(a) or (b)] (b) or (c) has already 
been applied--
          (1) may receive an additional six-month period under 
        subsection (c)(1)(A)(ii) for a supplemental application 
        if all other requirements under this section are 
        satisfied, except that such a drug may not receive any 
        additional such period under subsection (c)(2); and
          (2) may not receive any additional such period under 
        subsection (c)(1)(B).
    [(i)] (h) Relationship to Regulations.--Notwithstanding any 
other provision of law, if any pediatric study is required 
pursuant to regulations promulgated by the Secretary and such 
study meets the completeness, timeliness, and other 
requirements of this section, such study shall be deemed to 
satisfy the requirement for market exclusivity pursuant to this 
section.
    [(j) Sunset.--A drug may not receive any six-month period 
under subsection [(a) or (c)] (b) or (c) unless the application 
for the drug under section 505(b)(1) is submitted on or before 
January 1, 2002. After January 1, 2002, a drug shall receive a 
six-month period under subsection (c) if--
          [(1) the drug was in commercial distribution as of 
        the date of enactment of the Food and Drug 
        Administration Modernization Act of 1997;
          [(2) the drug was included by the Secretary on the 
        list under subsection (b) as of January 1, 2002;
          [(3) the Secretary determines that there is a 
        continuing need for information relating to the use of 
        the drug in the pediatric population and that the drug 
        may provide health benefits in that population; and
          [(4) All requirements of this section are met.]
    [(l)] (i) Labeling Supplements._
          (1) Priority status for pediatric supplements.--Any 
        supplement to an application under section 505 
        proposing a labeling change pursuant to a report on a 
        pediatric study under this section--
                  (A) shall be considered to be a priority 
                supplement; and
                  (B) shall be subject to the performance goals 
                established by the Commissioner for priority 
                drugs.
          (2) Dispute resolution.--If the Commissioner 
        determines that an application with respect to which a 
        pediatric study is conducted under this section is 
        approvable and that the only open issue for final 
        action on the application is the reaching of an 
        agreement between the sponsor of the application and 
        the Commissioner on appropriate changes to the labeling 
        for the drug that is the subject of the application--
                  (A) not later than 180 days after the date of 
                submission of the application--
                          (i) the Commissioner shall request 
                        that the sponsor of the application 
                        make any labeling change that the 
                        Commissioner determines to be 
                        appropriate; and
                          (ii) if the sponsor of the 
                        application does not agree to make a 
                        labeling change requested by the 
                        Commissioner by that date, the 
                        Commissioner shall immediately refer 
                        the matter to the Pediatric Advisory 
                        Subcommittee of the Anti-Infective 
                        Drugs Advisory Committee;
                  (B) not later than 90 days after receiving 
                the referral, the Pediatric Advisory 
                Subcommittee of the Anti-Infective Drugs 
                Advisory Committee shall--
                          (i) review the pediatric study 
                        reports; and
                          (ii) make a recommendation to the 
                        Commissioner concerning appropriate 
                        labeling changes, if any;
                  (C) the Commissioner shall consider the 
                recommendations of the Pediatric Advisory 
                Subcommittee of the Anti-Infective Drugs 
                Advisory Committee and, if appropriate, not 
                later than 30 days after receiving the 
                recommendation, make a request to the sponsor 
                of the application to make any labeling change 
                that the Commissioner determines to be 
                appropriate; and
                  (D) if the sponsor of the application, within 
                30 days after receiving a request under 
                subparagraph (C), does not agree to make a 
                labeling change requested by the Commissioner, 
                the Commissioner may deem the drug that is the 
                subject of the application to be misbranded.
    [(m)] (j) Dissemination of Pediatric Information._
          (1) In general.--Not later than 180 days after the 
        date of submission of a report on a pediatric study 
        under this section, the Commissioner shall make 
        available to the public a summary of the medical and 
        clinical pharmacology reviews of pediatric studies 
        conducted for the supplement, including by publication 
        in the Federal Register.
          (2) Effect of subsection.--Nothing in this subsection 
        alters or amends in any way section 552 of title 5 or 
        section 1905 of title 18, United States Code.
    [(n)] (k) Clarification of Interaction of Market 
Exclusivity Awarded to an Applicant for Approval of a Drug 
Under Section 505(j)._
          (1) In general.--If a 180-day period under section 
        505(j)(5)(B)(iv) overlaps with a 6-month extension 
        under this section, so that the applicant for approval 
        of a drug under section 505(j) entitled to the 180-day 
        period under that section loses a portion of the 180-
        day period to which the applicant is entitled for the 
        drug, the 180-day period shall be extended--
                  (A) if the 180-day period would, but for this 
                subsection, expire after the 6-month extension, 
                by the number of days of the overlap; or
                  (B) if the 180-day period would, but for this 
                subsection, expire during the 6-month 
                extension, by 6 months.
          (2) Effect of subsection.--Under no circumstances 
        shall application of this section result in enabling an 
        applicant for approval of a new drug under section 
        505(j) to commercially market the drug to the exclusion 
        of a subsequent applicant for approval of a new drug 
        under section 505(j) for more than 180 days.
    [(k)] (l) Report.--The Secretary shall conduct a study and 
report to Congress not later than January 1, 2001, based on the 
experience under the program established under this section. 
The study and report shall examine all relevant issues, 
including--
          (1) the effectiveness of the program in improving 
        information about important pediatric uses for approved 
        drugs;
          (2) the adequacy of the inventive provided under this 
        section;
          (3) the economic impact of the program on taxpayers 
        and consumers, including the impact of the lack of 
        lower cost generic drugs on patients, including on 
        lower income patients; and
          (4) any suggestions for modification that the 
        Secretary determines to be appropriate.
    [(j)] (m) Sunset.--A drug may not receive any 6-month 
period under subsection (b) or (c) unless--
          (1) on or before October 1, 2007, the Secretary makes 
        a written request for pediatric studies of the drug;
          (2) on or before October 1, 2007, an approvable 
        application for the drug is submitted under section 
        505(b)(1); and
          (3) all requirements of this section are met.

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SEC. 736. [21 U.S.C. 379H] AUTHORITY TO ASSESS AND USE DRUG FEES.

    (a) Types of Fees.--Beginning in fiscal year 1998, the 
Secretary shall assess and collect fees in accordance with this 
section as follows:
          (1) Human drug application and supplement fee.--
                  (A) * * *

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                  [(F) Exception for supplements for pediatric 
                indications.--A supplement to a human drug 
                application proposing to include a new 
                indication for use in pediatric populations 
                shall not be assessed a fee under subparagraph 
                (A).]
                  [(G)] (F) Refund of fee if application 
                withdrawn.--If an application or supplement is 
                withdrawn after the application or supplement 
                was filed, the Secretary may refund the fee or 
                a portion of the fee if no substantial work was 
                performed on the application or supplement 
                after the application or supplement was filed. 
                The Secretary shall have the sole discretion to 
                refund a fee or a portion of the fee under this 
                subparagraph. A determination by the Secretary 
                concerning a refund under this paragraph shall 
                not be reviewable.

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