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114th Congress    }                                          {     Report
                        HOUSE OF REPRESENTATIVES
 2d Session       }                                          {    114-735

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



 
       STRENGTHENING PUBLIC HEALTH EMERGENCY RESPONSE ACT OF 2016

                                _______
                                

 September 9, 2016.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

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

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 3299]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 3299) to amend the Public Health Service Act to 
ensure preparedness for chemical, radiological, biological, and 
nuclear threats, and for other purposes, having considered the 
same, report favorably thereon with an amendment and recommend 
that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     7
Background and Need for Legislation..............................     7
Hearings.........................................................     8
Committee Consideration..........................................     8
Committee Votes..................................................     8
Committee Oversight Findings.....................................    12
Statement of General Performance Goals and Objectives............    12
New Budget Authority, Entitlement Authority, and Tax Expenditures    12
Earmark, Limited Tax Benefits, and Limited Tariff Benefits.......    12
Committee Cost Estimate..........................................    12
Congressional Budget Office Estimate.............................    12
Federal Mandates Statement.......................................    14
Duplication of Federal Programs..................................    15
Disclosure of Directed Rule Makings..............................    15
Advisory Committee Statement.....................................    15
Applicability to Legislative Branch..............................    15
Section-by-Section Analysis of the Legislation...................    15
Changes in Existing Law Made by the Bill, as Reported............    16
Dissenting Views.................................................    47

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Strengthening Public 
Health Emergency Response Act of 2016''.
  (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. GAO report on State, local, and hospital preparedness programs.
Sec. 3. Strategic national stockpile.
Sec. 4. Project Bioshield procurement process.
Sec. 5. BARDA transaction authorities.
Sec. 6. Public health emergency medical countermeasures enterprise 
strategy and implementation plan.
Sec. 7. Priority review to encourage treatments for agents that present 
national security threats.

SEC. 2. GAO REPORT ON STATE, LOCAL, AND HOSPITAL PREPAREDNESS PROGRAMS.

  (a) In General.--Not later than 1 year after the date of enactment of 
this Act, the Comptroller General of the United States shall submit a 
report to the Congress on the programs for awarding cooperative 
agreements and grants under section 319C-1 of the Public Health Service 
Act (42 U.S.C. 247d-3a; improving State and local public health 
security) and section 319C-2 of such Act (42 U.S.C. 247d-3b; 
partnerships for State and regional hospital preparedness to improve 
surge capacity).
  (b) Contents.--The report under subsection (a) shall address each of 
the following:
          (1) The goals of the programs specified in subsection (a).
          (2) The extent to which such goals are being met, including 
        performance metrics that could help to assess whether such 
        programs are succeeding at the coalition and member level.
          (3) How such programs could be improved, including how such 
        programs could be modified to improve the medical preparedness 
        of hospitals, health care coalitions, and the continuity of 
        health care delivery.
          (4) How such programs complement other preparedness programs 
        of the Department of Health and Human Services.
          (5) How funds awarded through such programs should be 
        allocated and whether that allocation should be based on risk.
          (6) Progress made toward State and local preparedness 
        entities being self-sustaining.
          (7) Whether the level of funding for such programs is 
        sufficient.
          (8) How funding for such programs is being used to ensure 
        preparedness for at-risk populations including children, 
        pregnant women, senior citizens, and other individuals who may 
        have unique needs in the event of a public health emergency, 
        such as individuals with disabilities.
          (9)(A) How, and to what extent, entities are using the funds 
        awarded to such entities through section 319C-2 of the Public 
        Health Service Act (42 U.S.C. 247d-3b) to directly fund 
        regional health care coalitions and members of such coalitions.
          (B) The amount each such entity retains for its own indirect 
        and direct costs.
          (C) The purposes for which such retained funds are used and 
        whether these uses provide value for the program under such 
        section 319C-2, regional health care coalitions, and members of 
        such coalitions.
          (10) The extent to which the funds awarded through the 
        programs under sections 319C-1 and 319C-2 of the Public Health 
        Service Act (42 U.S.C. 247d-3a, 247d-3b) have been used for 
        overlapping purposes.

SEC. 3. STRATEGIC NATIONAL STOCKPILE.

  Section 319F-2(a)(2) of the Public Health Service Act (42 U.S.C. 
247d-6b(a)(2)) is amended--
          (1) in subparagraph (G), by striking ``and'' at the end;
          (2) in subparagraph (H), by striking the period at the end 
        and inserting ``; and''; and
          (3) by adding at the end the following:
                  ``(I) ensure procedures are in place to coordinate 
                the ongoing stockpiling by the Biomedical Advanced 
                Research and Development Authority and Centers for 
                Disease Control and Prevention of qualified 
                countermeasures (as defined in section 319F-1) for 
                which funds have been made available under this part, 
                security countermeasures (as defined in this section), 
                and qualified pandemic or epidemic products (as defined 
                in section 319F-3) for which funds have been made 
                available under section 319L in order to avoid any gaps 
                in preparedness.''.

SEC. 4. PROJECT BIOSHIELD PROCUREMENT PROCESS.

  Section 319F-2(c) of the Public Health Service Act (42 U.S.C. 247d-
6b(c)) is amended--
          (1) in paragraph (4)(A)(ii), by striking ``make a 
        recommendation under paragraph (6) that the special reserve 
        fund as defined in subsection (h) be made available for the 
        procurement of such countermeasure'' and inserting ``make 
        available the special reserve fund as defined in subsection (h) 
        for procurement of such countermeasure'';
          (2) in paragraph (6)--
                  (A) by striking subparagraphs (A), (B), (C), and (E); 
                and
                  (B) by striking ``(6) Recommendations for president's 
                approval'' and all that follows through ``(D) 
                Subsequent specific countermeasures.--'' and inserting 
                ``(6) Subsequent specific countermeasures.--''; and
          (3) in paragraph (7)--
                  (A) by striking subparagraph (A);
                  (B) by redesignating subparagraph (B) as subparagraph 
                (A) and amending such subparagraph (A), as 
                redesignated, to read as follows:
                  ``(A) Payments from special reserve fund.--The 
                special reserve fund as defined in subsection (h) shall 
                be available for payments made by the Secretary to a 
                vendor for procurement of a security countermeasure in 
                accordance with the provisions of this paragraph.''; 
                and
                  (C) by redesignating subparagraph (C) as subparagraph 
                (B).

SEC. 5. BARDA TRANSACTION AUTHORITIES.

  Section 319L(c)(5) of the Public Health Service Act (42 U.S.C. 247d-
7e(c)(5)) is amended by adding at the end the following:
                  ``(H) Contracting authority clarification.--The 
                Secretary shall delegate authority for negotiating and 
                entering into any contracts, grants, or cooperative 
                agreements under this section to the Director.''.

SEC. 6. PUBLIC HEALTH EMERGENCY MEDICAL COUNTERMEASURES ENTERPRISE 
                    STRATEGY AND IMPLEMENTATION PLAN.

  Section 2811(d)(2) of the Public Health Service Act (42 U.S.C. 300hh-
10(d)(2)) is amended--
          (1) in subparagraph (A), by inserting after ``describe the 
        chemical, biological, radiological, and nuclear agent or agents 
        that may present a threat to the Nation'' the following: 
        ``(which shall include pandemic influenza)'';
          (2) by striking ``and'' at the end of subparagraph (J);
          (3) by redesignating subparagraph (K) as subparagraph (L); 
        and
          (4) by inserting after subparagraph (J) the following:
                  ``(K) report on the amount of time between the 
                issuance of each request for a proposal or task order 
                from the Biomedical Advanced Research and Development 
                Authority and the award of a contract pursuant to such 
                request for a proposal or task order; and''.

SEC. 7. PRIORITY REVIEW TO ENCOURAGE TREATMENTS FOR AGENTS THAT PRESENT 
                    NATIONAL SECURITY THREATS.

  (a) In General.--Subchapter E of chapter V of the Federal Food, Drug, 
and Cosmetic Act (21 U.S.C. 360bbb et seq.) is amended by inserting 
after section 565 the following:

``SEC. 565A. PRIORITY REVIEW TO ENCOURAGE TREATMENTS FOR AGENTS THAT 
                    PRESENT NATIONAL SECURITY THREATS.

  ``(a) Definitions.--In this section:
          ``(1) Priority review.--The term `priority review', with 
        respect to a human drug application as defined in section 
        735(1), means review and action by the Secretary on such 
        application not later than 6 months after receipt by the 
        Secretary of such application, as described in the manual of 
        policies and procedures of the Food and Drug Administration and 
        goals identified in the letters described in section 101(b) of 
        the Food and Drug Administration Safety and Innovation Act 
        (Public Law 112-144).
          ``(2) Priority review voucher.--The term `priority review 
        voucher' means a voucher issued by the Secretary to the sponsor 
        of a material threat medical countermeasure application that 
        entitles the holder of such voucher to priority review of a 
        single human drug application submitted under section 505(b)(1) 
        of this Act or section 351(a) of the Public Health Service Act 
        after the date of approval of the material threat medical 
        countermeasure application.
          ``(3) Material threat medical countermeasure application.--
        The term `material threat medical countermeasure application' 
        means an application that--
                  ``(A) is a human drug application as defined in 
                section 735(1) to prevent, or treat harm from, a 
                biological, chemical, radiological, or nuclear agent 
                identified as a material threat under section 319F-
                2(c)(2)(A)(ii) of the Public Health Service Act;
                  ``(B) the Secretary deems eligible for priority 
                review;
                  ``(C) is approved after the date of enactment of the 
                Strengthening Public Health Emergency Response Act of 
                2016; and
                  ``(D) is for a human drug, no active ingredient 
                (including any ester or salt of the active ingredient) 
                of which has been approved pursuant to any other 
                application under section 505(b)(1) of this Act or 
                section 351(a) of the Public Health Service Act.
  ``(b) Priority Review Voucher.--
          ``(1) In general.--The Secretary shall award a priority 
        review voucher to the sponsor of a material threat medical 
        countermeasure application upon approval by the Secretary of 
        such application.
          ``(2) Transferability.--
                  ``(A) In general.--The sponsor of a material threat 
                medical countermeasure application that receives a 
                priority review voucher under this section may transfer 
                (including by sale) the entitlement to such voucher to 
                a sponsor of a human drug for which an application 
                under section 505(b)(1) of this Act or section 351(a) 
                of the Public Health Service Act will be submitted 
                after the date of the approval of the material threat 
                medical countermeasure application. There is no limit 
                on the number of times a priority review voucher may be 
                transferred before such voucher is used.
                  ``(B) Notification of transfer.--Each person to whom 
                a voucher is transferred shall notify the Secretary of 
                such change in ownership of the voucher not later than 
                30 days after the date of such transfer.
          ``(3) Notification.--
                  ``(A) In general.--The sponsor of a human drug 
                application shall notify the Secretary not later than 
                90 calendar days prior to submission of the human drug 
                application that is the subject of a priority review 
                voucher of an intent to submit the human drug 
                application, including the date on which the sponsor 
                intends to submit the application. Such notification 
                shall be a legally binding commitment to pay for the 
                user fee to be assessed in accordance with this 
                section.
                  ``(B) Transfer after notice.--The sponsor of a human 
                drug application that provides notification of the 
                intent of such sponsor to use the voucher for the human 
                drug application under subparagraph (A) may transfer 
                the voucher after such notification is provided, if 
                such sponsor has not yet submitted the human drug 
                application described in the notification.
  ``(c) Priority Review User Fee.--
          ``(1) In general.--The Secretary shall establish a user fee 
        program under which a sponsor of a human drug application that 
        is the subject of a priority review voucher shall pay to the 
        Secretary a fee determined under paragraph (2). Such fee shall 
        be in addition to any fee required to be submitted by the 
        sponsor under chapter VII.
          ``(2) Fee amount.--The amount of the priority review user fee 
        shall be determined each fiscal year by the Secretary and based 
        on the average cost incurred by the agency in the review of a 
        human drug application subject to priority review in the 
        previous fiscal year.
          ``(3) Annual fee setting.--The Secretary shall establish, 
        before the beginning of each fiscal year beginning after 
        September 30, 2016, for that fiscal year, the amount of the 
        priority review user fee.
          ``(4) Payment.--
                  ``(A) In general.--The priority review user fee 
                required by this subsection shall be due upon the 
                notification by a sponsor of the intent of such sponsor 
                to use the voucher, as specified in subsection 
                (b)(3)(A). All other user fees associated with the 
                human drug application shall be due as required by the 
                Secretary or under applicable law.
                  ``(B) Complete application.--An application described 
                in subparagraph (A) for which the sponsor requests the 
                use of a priority review voucher shall be considered 
                incomplete if the fee required by this subsection and 
                all other applicable user fees are not paid in 
                accordance with the Secretary's procedures for paying 
                such fees.
                  ``(C) No waivers, exemptions, reductions, or 
                refunds.--The Secretary may not grant a waiver, 
                exemption, reduction, or refund of any fees due and 
                payable under this section.
          ``(5) Offsetting collections.--Fees collected pursuant to 
        this subsection for any fiscal year--
                  ``(A) shall be deposited and credited as offsetting 
                collections to the account providing appropriations to 
                the Food and Drug Administration; and
                  ``(B) shall not be collected for any fiscal year 
                except to the extent provided in advance in 
                appropriation Acts.
  ``(d) Notice of Issuance of Voucher and Approval of Products Under 
Voucher.--The Secretary shall publish a notice in the Federal Register 
and on the public website of the Food and Drug Administration not later 
than 30 calendar days after the occurrence of each of the following:
          ``(1) The Secretary issues a priority review voucher under 
        this section.
          ``(2) The Secretary approves a drug pursuant to an 
        application submitted under section 505(b) of this Act or 
        section 351(a) of the Public Health Service Act for which the 
        sponsor of the application used a priority review voucher under 
        this section.
  ``(e) Eligibility for Other Programs.--Nothing in this section 
precludes a sponsor who seeks a priority review voucher under this 
section from participating in any other incentive program, including 
under this Act, except that no sponsor of a material threat medical 
countermeasure application may receive more than one priority review 
voucher issued under any section of this Act with respect to the drug 
that is the subject of such application.
  ``(f) Relation to Other Provisions.--The provisions of this section 
shall supplement, not supplant, any other provisions of this Act or the 
Public Health Service Act that encourage the development of medical 
countermeasures.
  ``(g) Medical Countermeasure Postapproval Report.--
          ``(1) In general.--Not later than 5 years after the date of 
        approval of a material threat medical countermeasure 
        application, the sponsor of such application shall submit a 
        report to the Secretary on such medical countermeasure.
          ``(2) Contents.--A report under paragraph (1) shall include, 
        with respect to each of the first 2 years after approval of 
        such material threat medical countermeasure application, a 
        description of--
                  ``(A) the sponsor's activities with Federal agencies 
                related to the procurement, including stockpiling, of 
                the approved medical countermeasure;
                  ``(B) the sponsor's progress in fulfilling contracts 
                entered into with Federal agencies, including the 
                Biomedical Advanced Research and Development Authority, 
                the Centers for Disease Control and Prevention, and the 
                Department of Defense, related to such procurement;
                  ``(C) the extent to which the Federal Government has 
                fulfilled its stated medical countermeasure 
                requirements for the threat intended to be treated by 
                the approved medical countermeasure; and
                  ``(D) the sponsor's plans, if any, to develop 
                additional material threat medical countermeasures.
          ``(3) Availability to congressional committees.--The 
        Secretary shall make each report submitted under this 
        subsection available to the Committee on Energy and Commerce of 
        the House of Representatives and the Committee on Health, 
        Education, Labor, and Pensions of the Senate upon request by 
        either such Committee not later than 30 days after receipt of 
        such request.
          ``(4) Rule of construction.--Nothing in this subsection shall 
        be construed to permit the disclosure of confidential 
        commercial or trade secret information or the disclosure of 
        information that could compromise national security.''.
  (b) GAO Report.--
          (1) Study.--The Comptroller General of the United States 
        shall conduct a study on the effectiveness of priority review 
        vouchers under section 565A of the Federal Food, Drug, and 
        Cosmetic Act, as added by subsection (a), in providing 
        incentives for the development of material threat medical 
        countermeasure applications under such section 565A. In 
        conducting such study, the Comptroller General shall examine 
        the following:
                  (A) The impact of such priority review on the 
                development of material threat medical countermeasures 
                and the impact of such investment, as applicable, on 
                the development of such countermeasures.
                  (B) How the drugs for which such priority review 
                vouchers were awarded--
                          (i) addressed identified medical 
                        countermeasure needs; and
                          (ii) impacted United States preparedness 
                        against chemical, biological, radiological, and 
                        nuclear threats, including both identified 
                        threats and naturally occurring threats.
                  (C) How many material threat medical countermeasures 
                were licensed or approved, or otherwise significantly 
                advanced in clinical development, in the 15 years 
                following the enactment of such section 565A compared 
                to the 15 years prior to the enactment of such section, 
                including a comparative analysis of Federal advanced 
                development and procurement dollars available in the 15 
                years following such enactment compared to the prior 15 
                years.
                  (D) How material threat medical countermeasures 
                developed after the date of enactment of this Act 
                impact--
                          (i) the supply of products in the strategic 
                        national stockpile under section 319F-2 of the 
                        Public Health Service Act (42 U.S.C. 247d-6b); 
                        and
                          (ii) national preparedness.
                  (E) How the Federal Government supported sponsors of 
                material threat medical countermeasures during the 
                research, development, application review, and 
                production of such drugs, including the use of 
                government research, provision of resources through 
                contracts or grants, and use of federally funded 
                research facilities.
                  (F) An analysis of the drugs for which such priority 
                review vouchers were used, which shall include--
                          (i) the indications for which such drugs were 
                        approved under section 505(b)(1) of the Federal 
                        Food, Drug, and Cosmetic Act (21 U.S.C. 
                        355(b)(1)) or section 351(a) of the Public 
                        Health Service Act (42 U.S.C. 262(a));
                          (ii) whether unmet medical needs were 
                        addressed through the approval of such drugs, 
                        including, for each such drug--
                                  (I) if there was a currently marketed 
                                therapy approved to prevent or treat 
                                the same indication in the same patient 
                                population at the time the application 
                                was submitted to the Food and Drug 
                                Administration; and
                                  (II) if the drug provided a 
                                significant benefit or improvement in 
                                safety and effectiveness compared to 
                                such currently marketed product;
                          (iii) the price of the priority review 
                        voucher if transferred or sold prior to 
                        redemption; and
                          (iv) the length of time between the date on 
                        which a priority review voucher was awarded and 
                        the date on which it was used.
                  (G) With respect to the priority review voucher 
                program under such section 565A--
                          (i) how many priority review vouchers were 
                        awarded under such section 565A and how many of 
                        such awarded vouchers were redeemed for 
                        priority review of a drug application in the 15 
                        years following the date of enactment of such 
                        section;
                          (ii) the resources associated with the Food 
                        and Drug Administration implementation of such 
                        section 565A and review of applications for 
                        which a voucher awarded under such section 565A 
                        is redeemed for priority review and if 
                        implementation of such section 565A prohibited 
                        the Food and Drug Administration from meeting 
                        drug application review goals;
                          (iii) recommendations on whether appropriate 
                        Federal funding for advanced development and 
                        research would necessitate the priority review 
                        voucher program for medical countermeasures;
                          (iv) the degree to which this incentive 
                        program impacts other priority review voucher 
                        programs; and
                          (v) the degree to which guaranteed Federal 
                        funding for advanced development and research 
                        is a greater incentive for new investment in 
                        research and the development of medical 
                        countermeasures than the uncertain values of 
                        vouchers.
          (2) Consultations.--In conducting the study under subsection 
        (a), the Comptroller General of the United States shall consult 
        with--
                  (A) drug manufacturers involved in the research and 
                development of medical countermeasures to address 
                biological, chemical, radiological, and nuclear 
                threats;
                  (B) stakeholders involved in investing in the 
                research and development of such medical 
                countermeasures, including venture capitalists;
                  (C) the Federal Government agencies responsible for 
                advancing, reviewing, and procuring such medical 
                countermeasures, including--
                          (i) the Department of Health and Human 
                        Services, including the Office of the Assistant 
                        Secretary for Preparedness and Response, the 
                        Biomedical Advanced Research and Development 
                        Authority, and the Food and Drug 
                        Administration; and
                          (ii) the Department of Defense;
                  (D) biodefense stakeholders, as applicable; and
                  (E) drug manufacturers involved in the research and 
                development of therapies that address--
                          (i) tropical diseases (as defined in section 
                        524(a) of the Federal Food, Drug, and Cosmetic 
                        Act (21 U.S.C. 360n(a))); or
                          (ii) rare pediatric diseases (as defined in 
                        section 529(a) of such Act (21 U.S.C. 
                        360ff(a))).
          (3) Initial assessment.--Not later than 10 years after the 
        date of enactment of this Act, the Comptroller General of the 
        United States 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 an 
        initial assessment of the effectiveness of the priority review 
        voucher program set forth in section 565A of the Federal Food, 
        Drug, and Cosmetic Act, as added by subsection (a).
          (4) Report.--Not later than 16 years after the date of 
        enactment of this Act, the Comptroller General of the United 
        States 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 
        containing the results of the study conducted under paragraph 
        (1).
          (5) Protection of national security.--The Comptroller General 
        of the United States shall conduct the study under paragraph 
        (1) and issue the assessment and report under paragraphs (3) 
        and (4) in a manner that does not compromise national security.

                          Purpose and Summary

    The purpose of H.R. 3299 is to enhance America's 
preparedness for biological threats and resulting public health 
emergencies. H.R. 3299 would improve and enhance our national 
preparedness in several ways: first, a Government 
Accountability Office (GAO) study would evaluate our current 
local and state emergency preparedness efforts to determine how 
to increase effectiveness; second, the bill would require 
coordination between Centers for Disease Control (CDC) and 
Biomedical Advanced Research and Development Authority (BARDA); 
third, the bill would increase the efficiency for contracting 
with companies to develop and procure products; fourth, the 
bill would amend an existing five year budget plan requirement 
to include pandemic influenza; and finally, the bill would 
provide a necessary and valuable incentive to ensure innovators 
develop medical products for national defense.
    H.R. 3299 also would establish a new priority review 
voucher (PRV) program at the Food and Drug Administration 
(FDA). Under this program, the Secretary would award a priority 
review voucher to sponsors of drugs that meet certain criteria, 
including that the drug prevent or treat harm from a 
biological, chemical, radiological, or nuclear agent that has 
been identified as a material threat by the Department of 
Homeland Security.

                  Background and Need for Legislation

    The past several years have demonstrated the global nature 
of biological threats. The Ebola outbreak in Western Africa and 
the emergence of Zika illustrate the importance of 
preparedness. A bipartisan report, issued on October 28, 2016, 
by the Blue Ribbon Study Panel on Biodefense, stated that 
``[t]he United States is underprepared for biological threats. 
. . . The Nation is dangerously vulnerable to a biological 
event. The root cause of this continuing vulnerability is the 
lack of strong centralized leadership at the highest level of 
government.''\1\ H.R. 3299 will address ``serious gaps and 
inadequacies that continue to leave the Nation vulnerable to 
threats from nature and terrorists alike.''\2\
---------------------------------------------------------------------------
    \1\A National Blueprint for Biodefense: Leadership and Major Reform 
Needed to Optimize Efforts. Bipartisan Reform of the Blue Ribbon Study 
Panel on Biodefense. P. iv
    \2\Ibid. P. iv.
---------------------------------------------------------------------------

                                Hearings

    The Subcommittee on Health held a hearing on H.R. 3299 on 
May 19, 2016. The Subcommittee received testimony from:
           Col. Russell Coleman, Ph.D., Joint Program 
        Manager, Medical Countermeasures Systems, U.S. 
        Department of Defense;
           Richard Hatchett, M.D., Acting Director, 
        Biomedical Advanced Research and Development Authority, 
        U.S. Department of Health and Human Services; and,
           Michael Mair, Director of Strategic 
        Operations, Office of Counterterrorism and Emerging 
        Threats, U.S. Food and Drug Administration.

                        Committee Consideration

    On June 7 and 8, 2016, the Subcommittee on Health met in 
open markup session and forwarded H.R. 3299 to the full 
Committee, as amended, by a voice vote. On July 12, 13, and 14, 
2016, the full Committee on Energy and Commerce met in open 
markup session and ordered H.R. 3299 reported to the House, as 
amended, by a recorded vote of 36 yeas and 15 nays.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. The 
following reflects the record votes taken during the Committee 
consideration:


                      Committee Oversight Findings

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

         Statement of General Performance Goals and Objectives

    H.R. 3299 would increase American emergency preparedness by 
increasing administrative efficiency within the Office of 
Assistant Secretary for Preparedness and Response (``ASPR'') in 
the U.S. Department of Health and Human Services (``HHS'') and 
provide incentives for companies to develop medical 
countermeasures for public health emergencies and biochemical 
attacks.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee finds that H.R. 
3299 would result in no new or increased budget authority, 
entitlement authority, or tax expenditures or revenues.

       Earmark, Limited Tax Benefits, and Limited Tariff Benefits

    In compliance with clause 9(e), 9(f), and 9(g) of rule XXI 
of the Rules of the House of Representatives, the Committee 
finds that H.R. 3299 contains no earmarks, limited tax 
benefits, or limited tariff benefits.

                        Committee Cost Estimate

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

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:
                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, September 7, 2016.
Hon. Fred Upton,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3299, the 
Strengthening Public Health Emergency Response Act of 2016.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Ellen Werble.
            Sincerely,
                                                        Keith Hall.
    Enclosure.

H.R. 3299--Strengthening Public Health Emergency Response Act of 2016

    Summary: H.R. 3299 would establish an incentive program 
that awards vouchers for priority review to companies that 
obtain approval from the Food and Drug Administration (FDA) for 
certain drugs that can be used to counter the effects of 
biological, chemical, radiological, or nuclear agents. The bill 
also would make several changes to the processes used to 
procure medical countermeasures in the Department of Health and 
Human Services (HHS). Finally, the Government Accountability 
Office (GAO) would be required to report on programs to improve 
state, local, and hospital preparedness. CBO estimates that 
implementing H.R. 3299 would cost $20 million over the 2017-
2021 period, assuming appropriation of the necessary amounts. 
Pay-as-you-go procedures do not apply to this legislation 
because it would not affect direct spending or revenues.
    CBO estimates that enacting H.R. 3299 would not increase 
net direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2027.
    H.R. 3299 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary effect of H.R. 3299 is shown in the following table. 
The costs of this legislation fall primarily within budget 
function 550 (health).

----------------------------------------------------------------------------------------------------------------
                                                                      By fiscal year, in millions of dollars--
                                                                   ---------------------------------------------
                                                                     2017   2018   2019   2020   2021  2017-2021
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION
 
Estimated Authorization Level.....................................      5      5      4      4      4        21
Estimated Outlays.................................................      4      4      4      4      4        20
----------------------------------------------------------------------------------------------------------------
Notes: Components do not sum to totals because of rounding.

    Basis of estimate: For this estimate, CBO assumes that the 
bill will be enacted near the beginning of fiscal year 2017 and 
that the necessary amounts will be appropriated.
    FDA: The bill would create an incentive program that awards 
vouchers for priority review to companies when they obtain FDA 
approval of certain drugs to counter the effects from 
biological, chemical, radiological, or nuclear agents. Such 
vouchers can be used to accelerate review of a future drug 
application. To redeem the voucher, a sponsor must pay an extra 
fee set by FDA each year to cover the agency's cost for the 
accelerated review. Such fees would be collected and made 
available for obligation only to the extent and in the amounts 
provided in advance in appropriation acts. (Estimated 
collections and related spending offset each other in the year 
fees are paid by sponsors.)
    To establish the new voucher program, CBO expects FDA would 
issue guidance containing the definition of the types of 
products that would be eligible for a voucher. Based on an 
analysis of information from FDA for similar programs, CBO 
estimates that those activities would require about 10 
employees to establish and to maintain the program. Assuming 
appropriation of the necessary amounts, CBO estimates 
implementing the new voucher program would cost FDA $18 million 
over the 2017-2021 period.
    HHS: The Office of the Assistant Secretary for Preparedness 
and Response (ASPR) within HHS is required to work with other 
HHS agencies to issue a Public Health Emergency Medical 
Countermeasures Enterprise Strategy and Implementation Plan 
(SIP) each year. The SIP outlines a strategy and an 
accompanying implementation plan for medical countermeasures to 
address chemical, biological, radiological, and nuclear 
threats. H.R. 3299 would require ASPR to include specific 
information about pandemic influenza in the SIP. It also would 
require ASPR to report on the amount of time it takes the 
Biomedical Advanced Research and Development Authority (BARDA) 
to award contracts once requests for proposals are issued. 
Based on information from HHS, CBO estimates that including 
these new elements in the SIP would require one employee to 
implement. Assuming appropriation of the necessary amounts, CBO 
estimates this section would cost HHS about $1 million over the 
2017-2021 period.
    GAO: H.R. 3299 would require GAO to report on programs to 
improve state, local, and hospital preparedness for public 
health emergencies. CBO estimates implementing that provision 
would cost about $500,000 over the 2017-2021 period; such 
spending would be subject to the availability of appropriated 
funds.
    Pay-As-You-Go considerations: None
    Increase in long-term direct spending and deficits: CBO 
estimates that enacting the legislation would not increase net 
direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2027.
    Intergovernmental and private-sector impact: H.R. 3299 
contains no intergovernmental or private-sector mandates as 
defined in the UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Previous CBO estimates: On August 8, 2016, CBO transmitted 
a cost estimate for S. 2055, the Medical Countermeasure 
Innovation Act of 2016, as reported by the Senate Committee on 
Health, Education, Labor, and Pensions on March 14, 2016. 
Several provisions are similar to provisions in H.R. 3299; 
however, S. 2055 would also authorize an additional program to 
invest in research and provide incentives for the development 
of medical countermeasures and would require HHS to prepare a 
five-year budget plan for such countermeasures. H.R. 3299 would 
authorize one program and modify existing requirements for an 
annual strategy and implementation plan. CBO's estimate of the 
budgetary effects reflects those differences.
    Estimate prepared by: Federal costs: Andrea Noda, Ellen 
Werble, and Rebecca Yip; Impact on state, local, and tribal 
governments: Zachary Byrum; Impact on the private sector: Amy 
Petz.
    Estimate approved by: Holly Harvey, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

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

                    Duplication of Federal Programs

    No provision of H.R. 3299 establishes or reauthorizes a 
program of the Federal Government known to be duplicative of 
another Federal program, a program that was included in any 
report from the Government Accountability Office to Congress 
pursuant to section 21 of Public Law 111-139, or a program 
related to a program identified in the most recent Catalog of 
Federal Domestic Assistance.

                  Disclosure of Directed Rule Makings

    The Committee estimates that enacting H.R. 3299 
specifically directs to be completed no rule makings within the 
meaning of 5 U.S.C. 551.

                      Advisory Committee Statement

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

                  Applicability to Legislative Branch

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

             Section-by-Section Analysis of the Legislation


Section 1. Short title; Table of contents

    Section 1 provides that this Act may be cited as the 
``Strengthening Public Health Emergency Response Act of 2016''.

Section 2. GAO report on state, local and hospital preparedness 
        programs

    This section requires GAO to submit a report to Congress 
within one year of enactment regarding the programs for 
awarding cooperative agreements and grants and partnerships for 
State and regional hospital preparedness to improve surge 
capacity.

Section 3. Strategic national stockpile

    This section requires that the Biomedical Advanced Research 
and Development Authority and Centers for Disease Control 
(BARDA) and Centers for Disease Control and Prevention (CDC) 
have procedures in place to coordinate ongoing stockpiling.

Section 4. Project Bioshield procurement process

    This section removes the requirement for Office of 
Management and Budget (OMB) to review all BioShield contracts 
independently. This independent review is no longer necessary 
because the funds, which were originally housed at Department 
of Homeland Security (DHS) is now housed at HHS. This will 
remove an unnecessary level of bureaucracy and expedite the 
contracting process.

Section 5. BARDA transaction authority

    This section would give BARDA the sole authority to 
negotiate and award its own medical countermeasure research and 
development contracts.

Section 6. Public health emergency medical countermeasures enterprise 
        strategy and implementation plan

    The 2013 Pandemic and All-Hazards Preparedness 
Reauthorization Act (PAHPRA) legislation required ASPR to 
create a 5-year medical countermeasure budget plan. The purpose 
of this plan was to anticipate countermeasure funding needs and 
spending plans across all chemical, biological, radiological 
and nuclear (CBRN) threats. In addition to CBRN, this section 
would require the 5-year budget to include planning for 
pandemic influenza, one of the largest public health threats we 
face today.

Section 7. Priority review to encourage treatments for agents that 
        present national security threats

    This section creates a new, permanent PRV program. This 
program would award a qualifying sponsor of a material threat 
medical countermeasures application a PRV, which entitles the 
sponsor to a second priority review of any other human drug 
application. To qualify for the award, a material threat 
medical countermeasure application must be for a human drug 
indicated to prevent, or treat harm from, a biological, 
chemical, radiological, or nuclear agent identified as a 
material threat. Additionally, the Secretary must deem the 
medical countermeasure application eligible for priority review 
and the medical countermeasure application must be approved 
after the date of enactment. The PRV is transferrable and there 
is no limit on how many times a voucher may be transferred or 
sold before it is used. The sponsor must notify FDA of its 
intent to transfer the voucher. Additionally, when a sponsor 
uses the PRV, it must notify FDA 90 days in advance of 
submitting an application for priority review and is required 
to pay an additional user fee, which shall be determined by the 
Secretary at the beginning of each fiscal year, starting after 
September 30, 2016.

         Changes in Existing Law Made by the Bill, as Reported

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

                       PUBLIC HEALTH SERVICE ACT




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

           *       *       *       *       *       *       *



Part B--Federal-State Cooperation

           *       *       *       *       *       *       *



SEC. 319F-2. STRATEGIC NATIONAL STOCKPILE AND SECURITY COUNTERMEASURE 
                    PROCUREMENTS.

  (a) Strategic National Stockpile.--
          (1) In general.--The Secretary, in collaboration with 
        the Director of the Centers for Disease Control and 
        Prevention, and in coordination with the Secretary of 
        Homeland Security (referred to in this section as the 
        ``Homeland Security Secretary''), shall maintain a 
        stockpile or stockpiles of drugs, vaccines and other 
        biological products, medical devices, and other 
        supplies in such numbers, types, and amounts as are 
        determined consistent with section 2811 by the 
        Secretary to be appropriate and practicable, taking 
        into account other available sources, to provide for 
        the emergency health security of the United States, 
        including the emergency health security of children and 
        other vulnerable populations, in the event of a 
        bioterrorist attack or other public health emergency. 
        The Secretary shall conduct an annual review (taking 
        into account at-risk individuals) of the contents of 
        the stockpile, including non-pharmaceutical supplies, 
        and make necessary additions or modifications to the 
        contents based on such review and shall submit such 
        review annually to the appropriate congressional 
        committees of jurisdiction to the extent that 
        disclosure of such information does not compromise 
        national security.
          (2) Procedures.--The Secretary, in managing the 
        stockpile under paragraph (1), shall--
                  (A) consult with the working group under 
                section 319F(a);
                  (B) ensure that adequate procedures are 
                followed with respect to such stockpile for 
                inventory management and accounting, and for 
                the physical security of the stockpile;
                  (C) in consultation with Federal, State, and 
                local officials, take into consideration the 
                timing and location of special events;
                  (D) review and revise, as appropriate, the 
                contents of the stockpile on a regular basis to 
                ensure that emerging threats, advanced 
                technologies, and new countermeasures are 
                adequately considered and that the potential 
                depletion of countermeasures currently in the 
                stockpile is identified and appropriately 
                addressed, including through necessary 
                replenishment;
                  (E) devise plans for the effective and timely 
                supply-chain management of the stockpile, in 
                consultation with appropriate Federal, State 
                and local agencies, and the public and private 
                health care infrastructure;
                  (F) deploy the stockpile as required by the 
                Secretary of Homeland Security to respond to an 
                actual or potential emergency;
                  (G) deploy the stockpile at the discretion of 
                the Secretary to respond to an actual or 
                potential public health emergency or other 
                situation in which deployment is necessary to 
                protect the public health or safety; [and]
                  (H) ensure the adequate physical security of 
                the stockpile[.]; and
                  (I) ensure procedures are in place to 
                coordinate the ongoing stockpiling by the 
                Biomedical Advanced Research and Development 
                Authority and Centers for Disease Control and 
                Prevention of qualified countermeasures (as 
                defined in section 319F-1) for which funds have 
                been made available under this part, security 
                countermeasures (as defined in this section), 
                and qualified pandemic or epidemic products (as 
                defined in section 319F-3) for which funds have 
                been made available under section 319L in order 
                to avoid any gaps in preparedness.
  (b) Smallpox Vaccine Development.--
          (1) In general.--The Secretary shall award contracts, 
        enter into cooperative agreements, or carry out such 
        other activities as may reasonably be required in order 
        to ensure that the stockpile under subsection (a) 
        includes an amount of vaccine against smallpox as 
        determined by such Secretary to be sufficient to meet 
        the health security needs of the United States.
          (2) Rule of construction.--Nothing in this section 
        shall be construed to limit the private distribution, 
        purchase, or sale of vaccines from sources other than 
        the stockpile described in subsection (a).
  (c) Additional Authority Regarding Procurement of Certain 
Countermeasures; Availability of Special Reserve Fund.--
          (1) In general.--
                  (A) Use of fund.--A security countermeasure 
                may, in accordance with this subsection, be 
                procured with amounts in the special reserve 
                fund as defined in subsection (h).
                  (B) Security countermeasure.--For purposes of 
                this subsection, the term ``security 
                countermeasure'' means a drug (as that term is 
                defined by section 201(g)(1) of the Federal 
                Food, Drug, and Cosmetic Act (21 U.S.C. 
                321(g)(1))), biological product (as that term 
                is defined by section 351(i) of this Act (42 
                U.S.C. 262(i))), or device (as that term is 
                defined by section 201(h) of the Federal Food, 
                Drug, and Cosmetic Act (21 U.S.C. 321(h))) 
                that--
                          (i)(I) the Secretary determines to be 
                        a priority (consistent with sections 
                        302(2) and 304(a) of the Homeland 
                        Security Act of 2002) to diagnose, 
                        mitigate, prevent, or treat harm from 
                        any biological, chemical, radiological, 
                        or nuclear agent identified as a 
                        material threat under paragraph 
                        (2)(A)(ii), or to diagnose, mitigate, 
                        prevent, or treat harm from a condition 
                        that may result in adverse health 
                        consequences or death and may be caused 
                        by administering a drug, biological 
                        product, or device against such an 
                        agent;
                          (II) the Secretary determines under 
                        paragraph (2)(B)(ii) to be a necessary 
                        countermeasure; and
                          (III)(aa) is approved or cleared 
                        under chapter V of the Federal Food, 
                        Drug, and Cosmetic Act or licensed 
                        under section 351 of this Act; or
                          (bb) is a countermeasure for which 
                        the Secretary determines that 
                        sufficient and satisfactory clinical 
                        experience or research data (including 
                        data, if available, from pre-clinical 
                        and clinical trials) support a 
                        reasonable conclusion that the 
                        countermeasure will qualify for 
                        approval or licensing within 10 years 
                        after the date of a determination under 
                        paragraph (5); or
                          (ii) is authorized for emergency use 
                        under section 564 of the Federal Food, 
                        Drug, and Cosmetic Act.
          (2) Determination of material threats.--
                  (A) Material threat.--The Homeland Security 
                Secretary, in consultation with the Secretary 
                and the heads of other agencies as appropriate, 
                shall on an ongoing basis--
                          (i) assess current and emerging 
                        threats of chemical, biological, 
                        radiological, and nuclear agents; and
                          (ii) determine which of such agents 
                        present a material threat against the 
                        United States population sufficient to 
                        affect national security.
                  (B) Public health impact; necessary 
                countermeasures.--The Secretary shall on an 
                ongoing basis--
                          (i) assess the potential public 
                        health consequences for the United 
                        States population of exposure to agents 
                        identified under subparagraph (A)(ii); 
                        and
                          (ii) determine, on the basis of such 
                        assessment, the agents identified under 
                        subparagraph (A)(ii) for which 
                        countermeasures are necessary to 
                        protect the public health.
                  (C) Notice to congress.--The Secretary and 
                the Homeland Security Secretary shall promptly 
                notify the appropriate committees of Congress 
                that a determination has been made pursuant to 
                subparagraph (A) or (B).
                  (D) Assuring access to threat information.--
                In making the assessment and determination 
                required under subparagraph (A), the Homeland 
                Security Secretary shall use all relevant 
                information to which such Secretary is entitled 
                under section 202 of the Homeland Security Act 
                of 2002, including but not limited to 
                information, regardless of its level of 
                classification, relating to current and 
                emerging threats of chemical, biological, 
                radiological, and nuclear agents.
          (3) Assessment of availability and appropriateness of 
        countermeasures.--
                  (A) In general.--The Secretary, in 
                consultation with the Homeland Security 
                Secretary, shall assess on an ongoing basis the 
                availability and appropriateness of specific 
                countermeasures to address specific threats 
                identified under paragraph (2).
                  (B) Information.--The Secretary shall 
                institute a process for making publicly 
                available the results of assessments under 
                subparagraph (A) while withholding such 
                information as--
                          (i) would, in the judgment of the 
                        Secretary, tend to reveal public health 
                        vulnerabilities; or
                          (ii) would otherwise be exempt from 
                        disclosure under section 552 of title 
                        5, United States Code.
          (4) Call for development of countermeasures; 
        commitment for recommendation for procurement.--
                  (A) Proposal to the president.--If, pursuant 
                to an assessment under paragraph (3), the 
                Homeland Security Secretary and the Secretary 
                make a determination that a countermeasure 
                would be appropriate but is either
                currently not developed or unavailable for 
                procurement as a security countermeasure or is 
                approved, licensed, or cleared only for 
                alternative uses, such Secretaries may jointly 
                submit to the President a proposal to--
                          (i) issue a call for the development 
                        of such countermeasure; and
                          (ii) make a commitment that, upon the 
                        first development of such 
                        countermeasure that meets the 
                        conditions for procurement under 
                        paragraph (5), the Secretaries will, 
                        based in part on information obtained 
                        pursuant to such call, [make a 
                        recommendation under paragraph (6) that 
                        the special reserve fund as defined in 
                        subsection (h) be made available for 
                        the procurement of such countermeasure] 
                        make available the special reserve fund 
                        as defined in subsection (h) for 
                        procurement of such countermeasure.
                  (B) Countermeasure specifications.--The 
                Homeland Security Secretary and the Secretary 
                shall, to the extent practicable, include in 
                the proposal under subparagraph (A)--
                          (i) estimated quantity of purchase 
                        (in the form of number of doses or 
                        number of effective courses of 
                        treatments regardless of dosage form);
                          (ii) necessary measures of minimum 
                        safety and effectiveness;
                          (iii) estimated price for each dose 
                        or effective course of treatment 
                        regardless of dosage form; and
                          (iv) other information that may be 
                        necessary to encourage and facilitate 
                        research, development, and manufacture 
                        of the countermeasure or to provide 
                        specifications for the countermeasure.
                  (C) Presidential approval.--If the President 
                approves a proposal under subparagraph (A), the 
                Homeland Security Secretary and the Secretary 
                shall make known to persons who may respond to 
                a call for the countermeasure involved--
                          (i) the call for the countermeasure;
                          (ii) specifications for the 
                        countermeasure under subparagraph (B); 
                        and
                          (iii) the commitment described in 
                        subparagraph (A)(ii).
          (5) Secretary's determination of countermeasures 
        appropriate for funding from special reserve fund.--
                  (A) In general.--The Secretary, in accordance 
                with the provisions of this paragraph, shall 
                identify specific security countermeasures that 
                the Secretary determines, in consultation with 
                the Homeland Security Secretary, to be 
                appropriate for inclusion in the stockpile 
                under subsection (a) pursuant to procurements 
                made with amounts in the special reserve fund 
                as defined in subsection (h) (referred to in 
                this subsection individually as a ``procurement 
                under this subsection'').
                  (B) Requirements.--In making a determination 
                under subparagraph (A) with respect to a 
                security countermeasure, the Secretary shall 
                determine and consider the following:
                          (i) The quantities of the product 
                        that will be needed to meet the 
                        stockpile needs.
                          (ii) The feasibility of production 
                        and delivery within 10 years of 
                        sufficient quantities of the product.
                          (iii) Whether there is a lack of a 
                        significant commercial market for the 
                        product at the time of procurement, 
                        other than as a security 
                        countermeasure.
          (6) [Recommendation for president's approval.--] 
        Subsequent specific countermeasures._ 
                  [(A) Recommendation for procurement.--In the 
                case of a security countermeasure that the 
                Secretary has, in accordance with paragraphs 
                (3) and (5), determined to be appropriate for 
                procurement under this subsection, the Homeland 
                Security Secretary and the Secretary shall 
                jointly submit to the President, in 
                coordination with the Director of the Office of 
                Management and Budget, a recommendation that 
                the special reserve fund as defined in 
                subsection (h) be made available for the 
                procurement of such countermeasure.
                  [(B) Presidential approval.--The special 
                reserve fund as defined in subsection (h) is 
                available for a procurement of a security 
                countermeasure only if the President has 
                approved a recommendation under subparagraph 
                (A) regarding the countermeasure.
                  [(C) Notice to appropriate congressional 
                committees.--The Secretary and the Homeland 
                Security Secretary shall notify the appropriate 
                congressional committees of each decision of 
                the President to approve a recommendation under 
                subparagraph (A). Such notice shall include an 
                explanation of the decision to make available 
                the special reserve fund as defined in 
                subsection (h) for procurement of such a 
                countermeasure, including, where available, the 
                number of, nature of, and other information 
                concerning potential suppliers of such 
                countermeasure, and whether other potential 
                suppliers of the same or similar 
                countermeasures were considered and rejected 
                for procurement under this section and the 
                reasons therefor.
                  [(D) Subsequent specific countermeasures.--
                ]Procurement under this subsection of a 
                security countermeasure for a particular 
                purpose does not preclude the subsequent 
                procurement under this subsection of any other 
                security countermeasure for such purpose if the 
                Secretary has determined under paragraph (5)(A) 
                that such countermeasure is appropriate for 
                inclusion in the stockpile and if, as 
                determined by the Secretary, such 
                countermeasure provides improved safety or 
                effectiveness, or for other reasons enhances 
                preparedness to respond to threats of use of a 
                biological, chemical, radiological, or nuclear 
                agent. Such a determination by the Secretary is 
                committed to agency discretion.
                  [(E) Rule of construction.--Recommendations 
                and approvals under this paragraph apply solely 
                to determinations that the special reserve fund 
                as defined in subsection (h) will be made 
                available for a procurement of a security 
                countermeasure, and not to the substance of 
                contracts for such procurement or other matters 
                relating to awards of such contracts.]
                  (7) Procurement.--
                          [(A) In general.--For purposes of a 
                        procurement under this subsection that 
                        is approved by the President under 
                        paragraph (6), the Homeland Security 
                        Secretary and the Secretary shall have 
                        responsibilities in accordance with 
                        subparagraphs (B) and (C).
                          [(B) Interagency agreement; cost.--
                        The Homeland Security Secretary shall 
                        enter into an agreement with the 
                        Secretary for procurement of a security 
                        countermeasure in accordance with the 
                        provisions of this paragraph. The 
                        special reserve fund as defined in 
                        subsection (h) shall be available for 
                        payments made by the Secretary to a 
                        vendor for such procurement.]
                          (A) Payments from special reserve 
                        fund.--The special reserve fund as 
                        defined in subsection (h) shall be 
                        available for payments made by the 
                        Secretary to a vendor for procurement 
                        of a security countermeasure in 
                        accordance with the provisions of this 
                        paragraph.
                          [(C)] (B) Procurement.--
                                  (i) In general.--The 
                                Secretary shall be responsible 
                                for--
                                          (I) arranging for 
                                        procurement of a 
                                        security 
                                        countermeasure, 
                                        including negotiating 
                                        terms (including 
                                        quantity, production 
                                        schedule, and price) 
                                        of, and entering into, 
                                        contracts and 
                                        cooperative agreements, 
                                        and for carrying out 
                                        such other activities 
                                        as may reasonably be 
                                        required, including 
                                        advanced research and 
                                        development, in 
                                        accordance with the 
                                        provisions of this 
                                        subparagraph; and
                                          (II) promulgating 
                                        such regulations as the 
                                        Secretary determines 
                                        necessary to implement 
                                        the provisions of this 
                                        subsection.
                                  (ii) Contract terms.--A 
                                contract for procurements under 
                                this subsection shall (or, as 
                                specified below, may) include 
                                the following terms:
                                          (I) Payment 
                                        conditioned on 
                                        delivery.--The contract 
                                        shall provide that no 
                                        payment may be made 
                                        until delivery of a 
                                        portion, acceptable to 
                                        the Secretary, of the 
                                        total number of units 
                                        contracted for, except 
                                        that, notwithstanding 
                                        any other provision of 
                                        law, the contract may 
                                        provide that, if the 
                                        Secretary determines 
                                        (in the Secretary's 
                                        discretion) that an 
                                        advance payment, 
                                        partial payment for 
                                        significant milestones, 
                                        or payment to increase 
                                        manufacturing capacity 
                                        is necessary to ensure 
                                        success of a project, 
                                        the Secretary shall pay 
                                        an amount, not to 
                                        exceed 10 percent of 
                                        the contract amount, in 
                                        advance of delivery. 
                                        The Secretary shall, to 
                                        the extent practicable, 
                                        make the determination 
                                        of advance payment at 
                                        the same time as the 
                                        issuance of a 
                                        solicitation. The 
                                        contract shall provide 
                                        that such advance 
                                        payment is required to 
                                        be repaid if there is a 
                                        failure to perform by 
                                        the vendor under the 
                                        contract. The contract 
                                        may also provide for 
                                        additional advance 
                                        payments of 5 percent 
                                        each for meeting the 
                                        milestones specified in 
                                        such contract, except 
                                        that such payments 
                                        shall not exceed 50 
                                        percent of the total 
                                        contract amount. If the 
                                        specified milestones 
                                        are reached, the 
                                        advanced payments of 5 
                                        percent shall not be 
                                        required to be repaid. 
                                        Nothing in this 
                                        subclause shall be 
                                        construed as affecting 
                                        the rights of vendors 
                                        under provisions of law 
                                        or regulation 
                                        (including the Federal 
                                        Acquisition Regulation) 
                                        relating to the 
                                        termination of 
                                        contracts for the 
                                        convenience of the 
                                        Government.
                                          (II) Discounted 
                                        payment.--The contract 
                                        may provide for a 
                                        discounted price per 
                                        unit of a product that 
                                        is not licensed, 
                                        cleared, or approved as 
                                        described in paragraph 
                                        (1)(B)(i)(III)(aa) at 
                                        the time of delivery, 
                                        and may provide for 
                                        payment of an 
                                        additional amount per 
                                        unit if the product 
                                        becomes so licensed, 
                                        cleared, or approved 
                                        before the expiration 
                                        date of the contract 
                                        (including an 
                                        additional amount per 
                                        unit of product 
                                        delivered before the 
                                        effective date of such 
                                        licensing, clearance, 
                                        or approval).
                                          (III) Contract 
                                        duration.--The contract 
                                        shall be for a period 
                                        not to exceed five 
                                        years, except that, in 
                                        first awarding the 
                                        contract, the Secretary 
                                        may provide for a 
                                        longer duration, not 
                                        exceeding 10 years, if 
                                        the Secretary 
                                        determines that 
                                        complexities or other 
                                        difficulties in 
                                        performance under the 
                                        contract justify such a 
                                        period. The contract 
                                        shall be renewable for 
                                        additional periods, 
                                        none of which shall 
                                        exceed five years.
                                          (IV) Storage by 
                                        vendor.--The contract 
                                        may provide that the 
                                        vendor will provide 
                                        storage for stocks of a 
                                        product delivered to 
                                        the ownership of the 
                                        Federal Government 
                                        under the contract, for 
                                        such period and under 
                                        such terms and 
                                        conditions as the 
                                        Secretary may specify, 
                                        and in such case 
                                        amounts from the 
                                        special reserve fund as 
                                        defined in subsection 
                                        (h) shall be available 
                                        for costs of shipping, 
                                        handling, storage, and 
                                        related costs for such 
                                        product.
                                          (V) Product 
                                        approval.--The contract 
                                        shall provide that the 
                                        vendor seek approval, 
                                        clearance, or licensing 
                                        of the product from the 
                                        Secretary; for a 
                                        timetable for the 
                                        development of data and 
                                        other information to 
                                        support such approval, 
                                        clearance, or 
                                        licensing; and that the 
                                        Secretary may waive 
                                        part or all of this 
                                        contract term on 
                                        request of the vendor 
                                        or on the initiative of 
                                        the Secretary.
                                          (VI) Non-stockpile 
                                        transfers of security 
                                        countermeasures.--The 
                                        contract shall provide 
                                        that the vendor will 
                                        comply with all 
                                        applicable export-
                                        related controls with 
                                        respect to such 
                                        countermeasure.
                                          (VII) Sales 
                                        exclusivity.--The 
                                        contract may provide 
                                        that the vendor is the 
                                        exclusive supplier of 
                                        the product to the 
                                        Federal Government for 
                                        a specified period of 
                                        time, not to exceed the 
                                        term of the contract, 
                                        on the condition that 
                                        the vendor is able to 
                                        satisfy the needs of 
                                        the Government. During 
                                        the agreed period of 
                                        sales exclusivity, the 
                                        vendor shall not assign 
                                        its rights of sales 
                                        exclusivity to another 
                                        entity or entities 
                                        without approval by the 
                                        Secretary. Such a sales 
                                        exclusivity provision 
                                        in such a contract 
                                        shall constitute a 
                                        valid basis for a sole 
                                        source procurement 
                                        under section 303(c)(1) 
                                        of the Federal Property 
                                        and Administrative 
                                        Services Act of 1949 
                                        (41 U.S.C. 253(c)(1)).
                                          (VIII) Warm based 
                                        surge capacity.--The 
                                        contract may provide 
                                        that the vendor 
                                        establish domestic 
                                        manufacturing capacity 
                                        of the product to 
                                        ensure that additional 
                                        production of the 
                                        product is available in 
                                        the event that the 
                                        Secretary determines 
                                        that there is a need to 
                                        quickly purchase 
                                        additional quantities 
                                        of the product. Such 
                                        contract may provide a 
                                        fee to the vendor for 
                                        establishing and 
                                        maintaining such 
                                        capacity in excess of 
                                        the initial requirement 
                                        for the purchase of the 
                                        product. Additionally, 
                                        the cost of maintaining 
                                        the domestic 
                                        manufacturing capacity 
                                        shall be an allowable 
                                        and allocable direct 
                                        cost of the contract.
                                          (IX) Contract 
                                        terms.--The Secretary, 
                                        in any contract for 
                                        procurement under this 
                                        section--
                                                  (aa) may 
                                                specify--
                                     (AA) the dosing and administration 
                                       requirements for the 
                                       countermeasure to be developed 
                                       and procured;
                                     (BB) the amount of funding that 
                                       will be dedicated by the 
                                       Secretary for advanced research, 
                                       development, and procurement of 
                                       the countermeasure; and
                                     (CC) the specifications the 
                                       countermeasure must meet to 
                                       qualify for procurement under a 
                                       contract under this section; and
                                                  (bb) shall 
                                                provide a clear 
                                                statement of 
                                                defined 
                                                Government 
                                                purpose limited 
                                                to uses related 
                                                to a security 
                                                countermeasure, 
                                                as defined in 
                                                paragraph 
                                                (1)(B).
                                  (iii) Availability of 
                                simplified acquisition 
                                procedures.--
                                          (I) In general.--If 
                                        the Secretary 
                                        determines that there 
                                        is a pressing need for 
                                        a procurement of a 
                                        specific 
                                        countermeasure, the 
                                        amount of the 
                                        procurement under this 
                                        subsection shall be 
                                        deemed to be below the 
                                        threshold amount 
                                        specified in section 
                                        4(11) of the Office of 
                                        Federal Procurement 
                                        Policy Act (41 U.S.C. 
                                        403(11)), for purposes 
                                        of application to such 
                                        procurement, pursuant 
                                        to section 302A(a) of 
                                        the Federal Property 
                                        and Administrative 
                                        Services Act of 1949 
                                        (41 U.S.C. 252a(a)), 
                                        of--
                                                  (aa) section 
                                                303(g)(1)(A) of 
                                                the Federal 
                                                Property and 
                                                Administrative 
                                                Services Act of 
                                                1949 (41 U.S.C. 
                                                253(g)(1)(A)) 
                                                and its 
                                                implementing 
                                                regulations; 
                                                and
                                                  (bb) section 
                                                302A(b) of such 
                                                Act (41 U.S.C. 
                                                252a(b)) and 
                                                its 
                                                implementing 
                                                regulations.
                                          (II) Application of 
                                        certain provisions.--
                                        Notwithstanding 
                                        subclause (I) and the 
                                        provision of law and 
                                        regulations referred to 
                                        in such clause, each of 
                                        the following 
                                        provisions shall apply 
                                        to procurements 
                                        described in this 
                                        clause to the same 
                                        extent that such 
                                        provisions would apply 
                                        to such procurements in 
                                        the absence of 
                                        subclause (I):
                                                  (aa) Chapter 
                                                37 of title 40, 
                                                United States 
                                                Code (relating 
                                                to contract 
                                                work hours and 
                                                safety 
                                                standards).
                                                  (bb) 
                                                Subsections (a) 
                                                and (b) of 
                                                section 7 of 
                                                the Anti-
                                                Kickback Act of 
                                                1986 (41 U.S.C. 
                                                57(a) and (b)).
                                                  (cc) Section 
                                                304C of the 
                                                Federal 
                                                Property and 
                                                Administrative 
                                                Services Act of 
                                                1949 (41 U.S.C. 
                                                254d) (relating 
                                                to the 
                                                examination of 
                                                contractor 
                                                records).
                                                  (dd) Section 
                                                3131 of title 
                                                40, United 
                                                States Code 
                                                (relating to 
                                                bonds of 
                                                contractors of 
                                                public 
                                                buildings or 
                                                works).
                                                  (ee) 
                                                Subsection (a) 
                                                of section 304 
                                                of the Federal 
                                                Property and 
                                                Administrative 
                                                Services Act of 
                                                1949 (41 U.S.C. 
                                                254(a)) 
                                                (relating to 
                                                contingent fees 
                                                to middlemen).
                                                  (ff) Section 
                                                6002 of the 
                                                Solid Waste 
                                                Disposal Act 
                                                (42 U.S.C. 
                                                6962).
                                                  (gg) Section 
                                                1354 of title 
                                                31, United 
                                                States Code 
                                                (relating to 
                                                the limitation 
                                                on the use of 
                                                appropriated 
                                                funds for 
                                                contracts with 
                                                entities not 
                                                meeting 
                                                veterans 
                                                employment 
                                                reporting 
                                                requirements).
                                          (III) Internal 
                                        controls to be 
                                        established.--The 
                                        Secretary shall 
                                        establish appropriate 
                                        internal controls for 
                                        procurements made under 
                                        this clause, including 
                                        requirements with 
                                        respect to 
                                        documentation of the 
                                        justification for the 
                                        use of the authority 
                                        provided under this 
                                        paragraph with respect 
                                        to the procurement 
                                        involved.
                                          (IV) Authority to 
                                        limit competition.--In 
                                        conducting a 
                                        procurement under this 
                                        subparagraph, the 
                                        Secretary may not use 
                                        the authority provided 
                                        for under subclause (I) 
                                        to conduct a 
                                        procurement on a basis 
                                        other than full and 
                                        open competition unless 
                                        the Secretary 
                                        determines that the 
                                        mission of the 
                                        BioShield Program under 
                                        the Project BioShield 
                                        Act of 2004 would be 
                                        seriously impaired 
                                        without such a 
                                        limitation.
                                  (iv) Procedures other than 
                                full and open competition.--
                                          (I) In general.--In 
                                        using the authority 
                                        provided in section 
                                        303(c)(1) of title III 
                                        of the Federal Property 
                                        and Administrative 
                                        Services Act of 1949 
                                        (41 U.S.C. 253(c)(1)) 
                                        to use procedures other 
                                        than competitive 
                                        procedures in the case 
                                        of a procurement under 
                                        this subsection, the 
                                        phrase ``available from 
                                        only one responsible 
                                        source'' in such 
                                        section 303(c)(1) shall 
                                        be deemed to mean 
                                        ``available from only 
                                        one responsible source 
                                        or only from a limited 
                                        number of responsible 
                                        sources''.
                                          (II) Relation to 
                                        other authorities.--The 
                                        authority under 
                                        subclause (I) is in 
                                        addition to any other 
                                        authority to use 
                                        procedures other than 
                                        competitive procedures.
                                          (III) Applicable 
                                        government-wide 
                                        regulations.--The 
                                        Secretary shall 
                                        implement this clause 
                                        in accordance with 
                                        government-wide 
                                        regulations 
                                        implementing such 
                                        section 303(c)(1) 
                                        (including requirements 
                                        that offers be 
                                        solicited from as many 
                                        potential sources as is 
                                        practicable under the 
                                        circumstances, that 
                                        required notices be 
                                        published, and that 
                                        submitted offers be 
                                        considered), as such 
                                        regulations apply to 
                                        procurements for which 
                                        an agency has authority 
                                        to use procedures other 
                                        than competitive 
                                        procedures when the 
                                        property or services 
                                        needed by the agency 
                                        are available from only 
                                        one responsible source 
                                        or only from a limited 
                                        number of responsible 
                                        sources and no other 
                                        type of property or 
                                        services will satisfy 
                                        the needs of the 
                                        agency.
                                  (v) Premium provision in 
                                multiple award contracts.--
                                          (I) In general.--If, 
                                        under this subsection, 
                                        the Secretary enters 
                                        into contracts with 
                                        more than one vendor to 
                                        procure a security 
                                        countermeasure, such 
                                        Secretary may, 
                                        notwithstanding any 
                                        other provision of law, 
                                        include in each of such 
                                        contracts a provision 
                                        that--
                                                  (aa) 
                                                identifies an 
                                                increment of 
                                                the total 
                                                quantity of 
                                                security 
                                                countermeasure 
                                                required, 
                                                whether by 
                                                percentage or 
                                                by numbers of 
                                                units; and
                                                  (bb) promises 
                                                to pay one or 
                                                more specified 
                                                premiums based 
                                                on the priority 
                                                of such 
                                                vendors' 
                                                production and 
                                                delivery of the 
                                                increment 
                                                identified 
                                                under item 
                                                (aa), in 
                                                accordance with 
                                                the terms and 
                                                conditions of 
                                                the contract.
                                          (II) Determination of 
                                        government's 
                                        requirement not 
                                        reviewable.--If the 
                                        Secretary includes in 
                                        each of a set of 
                                        contracts a provision 
                                        as described in 
                                        subclause (I), such 
                                        Secretary's 
                                        determination of the 
                                        total quantity of 
                                        security countermeasure 
                                        required, and any 
                                        amendment of such 
                                        determination, is 
                                        committed to agency 
                                        discretion.
                                  (vi) Extension of closing 
                                date for receipt of proposals 
                                not reviewable.--A decision by 
                                the Secretary to extend the 
                                closing date for receipt of 
                                proposals for a procurement 
                                under this subsection is 
                                committed to agency discretion.
                                  (vii) Limiting competition to 
                                sources responding to request 
                                for information.--In conducting 
                                a procurement under this 
                                subsection, the Secretary may 
                                exclude a source that has not 
                                responded to a request for 
                                information under section 
                                303A(a)(1)(B) of the Federal 
                                Property and Administrative 
                                Services Act of 1949 (41 U.S.C. 
                                253a(a)(1)(B)) if such request 
                                has given notice that the 
                                Secretary may so exclude such a 
                                source.
                                  (viii) Flexibility.--In 
                                carrying out this section, the 
                                Secretary may, consistent with 
                                the applicable provisions of 
                                this section, enter into 
                                contracts and other agreements 
                                that are in the best interest 
                                of the Government in meeting 
                                identified security 
                                countermeasure needs, including 
                                with respect to reimbursement 
                                of the cost of advanced 
                                research and development as a 
                                reasonable, allowable, and 
                                allocable direct cost of the 
                                contract involved.
          (8) Interagency cooperation.--
                  (A) In general.--In carrying out activities 
                under this section, the Homeland Security 
                Secretary and the Secretary are authorized, 
                subject to subparagraph (B), to enter into 
                interagency agreements and other collaborative 
                undertakings with other agencies of the United 
                States Government. Such agreements may allow 
                other executive agencies to order qualified and 
                security countermeasures under procurement 
                contracts or other agreements established by 
                the Secretary. Such ordering process (including 
                transfers of appropriated funds between an 
                agency and the Department of Health and Human 
                Services as reimbursements for such orders for 
                countermeasures) may be conducted under the 
                authority of section 1535 of title 31, United 
                States Code, except that all such orders shall 
                be processed under the terms established under 
                this subsection for the procurement of 
                countermeasures.
                  (B) Limitation.--An agreement or undertaking 
                under this paragraph shall not authorize 
                another agency to exercise the authorities 
                provided by this section to the Homeland 
                Security Secretary or to the Secretary.
  (d) Disclosures.--No Federal agency shall disclose under 
section 552 of title 5, United States Code, any information 
identifying the location at which materials in the stockpile 
under subsection (a) are stored.
  (e) Definition.--For purposes of subsection (a), the term 
``stockpile'' includes--
          (1) a physical accumulation (at one or more 
        locations) of the supplies described in subsection (a); 
        or
          (2) a contractual agreement between the Secretary and 
        a vendor or vendors under which such vendor or vendors 
        agree to provide to such Secretary supplies described 
        in subsection (a).
  (f) Authorization of Appropriations.--
          (1) Strategic national stockpile.--For the purpose of 
        carrying out subsection (a), there are authorized to be 
        appropriated $533,800,000 for each of fiscal years 2014 
        through 2018. Such authorization is in addition to 
        amounts in the special reserve fund referred to in 
        subsection (h).
          (2) Smallpox vaccine development.--For the purpose of 
        carrying out subsection (b), there are authorized to be 
        appropriated $509,000,000 for fiscal year 2002, and 
        such sums as may be necessary for each of fiscal years 
        2003 through 2006.
  (g) Special Reserve Fund.--
          (1) Authorization of appropriations.--In addition to 
        amounts appropriated to the special reserve fund prior 
        to the date of the enactment of this subsection, there 
        is authorized to be appropriated, for the procurement 
        of security countermeasures under subsection (c) and 
        for carrying out section 319L (relating to the 
        Biomedical Advanced Research and Development 
        Authority), $2,800,000,000 for the period of fiscal 
        years 2014 through 2018. Amounts appropriated pursuant 
        to the preceding sentence are authorized to remain 
        available until September 30, 2019.
          (2) Use of special reserve fund for advanced research 
        and development.--The Secretary may utilize not more 
        than 50 percent of the amounts authorized to be 
        appropriated under paragraph (1) to carry out section 
        319L (related to the Biomedical Advanced Research and 
        Development Authority). Amounts authorized to be 
        appropriated under this subsection to carry out section 
        319L are in addition to amounts otherwise authorized to 
        be appropriated to carry out such section.
          (3) Restrictions on use of funds.--Amounts in the 
        special reserve fund shall not be used to pay costs 
        other than payments made by the Secretary to a vendor 
        for advanced development (under section 319L) or for 
        procurement of a security countermeasure under 
        subsection (c)(7).
          (4) Report.--Not later than 30 days after any date on 
        which the Secretary determines that the amount of funds 
        in the special reserve fund available for procurement 
        is less than $1,500,000,000, the Secretary shall submit 
        to the appropriate committees of Congress a report 
        detailing the amount of such funds available for 
        procurement and the impact such reduction in funding 
        will have--
                  (A) in meeting the security countermeasure 
                needs identified under this section; and
                  (B) on the annual Public Health Emergency 
                Medical Countermeasures Enterprise and Strategy 
                Implementation Plan (pursuant to section 
                2811(d)).
  (h) Definitions.--In this section:
          (1) The term ``advanced research and development'' 
        has the meaning given such term in section 319L(a).
          (2) The term ``special reserve fund'' means the 
        ``Biodefense Countermeasures'' appropriations account, 
        any appropriation made available pursuant to section 
        521(a) of the Homeland Security Act of 2002, and any 
        appropriation made available pursuant to subsection 
        (g)(1).

           *       *       *       *       *       *       *


SEC. 319L. BIOMEDICAL ADVANCED RESEARCH AND DEVELOPMENT AUTHORITY.

  (a) Definitions.--In this section:
          (1) BARDA.--The term ``BARDA'' means the Biomedical 
        Advanced Research and Development Authority.
          (2) Fund.--The term ``Fund'' means the Biodefense 
        Medical Countermeasure Development Fund established 
        under subsection (d).
          (3) Other transactions.--The term ``other 
        transactions'' means transactions, other than 
        procurement contracts, grants, and cooperative 
        agreements, such as the Secretary of Defense may enter 
        into under section 2371 of title 10, United States 
        Code.
          (4) Qualified countermeasure.--The term ``qualified 
        countermeasure'' has the meaning given such term in 
        section 319F-1.
          (5) Qualified pandemic or epidemic product.--The term 
        ``qualified pandemic or epidemic product'' has the 
        meaning given the term in section 319F-3.
          (6) Advanced research and development.--
                  (A) In general.--The term ``advanced research 
                and development'' means, with respect to a 
                product that is or may become a qualified 
                countermeasure or a qualified pandemic or 
                epidemic product, activities that 
                predominantly--
                          (i) are conducted after basic 
                        research and preclinical development of 
                        the product; and
                          (ii) are related to manufacturing the 
                        product on a commercial scale and in a 
                        form that satisfies the regulatory 
                        requirements under the Federal Food, 
                        Drug, and Cosmetic Act or under section 
                        351 of this Act.
                  (B) Activities included.--The term under 
                subparagraph (A) includes--
                          (i) testing of the product to 
                        determine whether the product may be 
                        approved, cleared, or licensed under 
                        the Federal Food, Drug, and Cosmetic 
                        Act or under section 351 of this Act 
                        for a use that is or may be the basis 
                        for such product becoming a qualified 
                        countermeasure or qualified pandemic or 
                        epidemic product, or to help obtain 
                        such approval, clearance, or license;
                          (ii) design and development of tests 
                        or models, including animal models, for 
                        such testing;
                          (iii) activities to facilitate 
                        manufacture of the product on a 
                        commercial scale with consistently high 
                        quality, as well as to improve and make 
                        available new technologies to increase 
                        manufacturing surge capacity;
                          (iv) activities to improve the shelf-
                        life of the product or technologies for 
                        administering the product; and
                          (v) such other activities as are part 
                        of the advanced stages of testing, 
                        refinement, improvement, or preparation 
                        of the product for such use and as are 
                        specified by the Secretary.
          (7) Security countermeasure.--The term ``security 
        countermeasure'' has the meaning given such term in 
        section 319F-2.
          (8) Research tool.--The term ``research tool'' means 
        a device, technology, biological material (including a 
        cell line or an antibody), reagent, animal model, 
        computer system, computer software, or analytical 
        technique that is developed to assist in the discovery, 
        development, or manufacture of qualified 
        countermeasures or qualified pandemic or epidemic 
        products.
          (9) Program manager.--The term ``program manager'' 
        means an individual appointed to carry out functions 
        under this section and authorized to provide project 
        oversight and management of strategic initiatives.
          (10) Person.--The term ``person'' includes an 
        individual, partnership, corporation, association, 
        entity, or public or private corporation, and a 
        Federal, State, or local government agency or 
        department.
  (b) Strategic Plan for Countermeasure Research, Development, 
and Procurement.--
          (1) In general.--Not later than 6 months after the 
        date of enactment of the Pandemic and All-Hazards 
        Preparedness Act, the Secretary shall develop and make 
        public a strategic plan to integrate biodefense and 
        emerging infectious disease requirements with the 
        advanced research and development, strategic 
        initiatives for innovation, and the procurement of 
        qualified countermeasures and qualified pandemic or 
        epidemic products. The Secretary shall carry out such 
        activities as may be practicable to disseminate the 
        information contained in such plan to persons who may 
        have the capacity to substantially contribute to the 
        activities described in such strategic plan. The 
        Secretary shall update and incorporate such plan as 
        part of the National Health Security Strategy described 
        in section 2802.
          (2) Content.--The strategic plan under paragraph (1) 
        shall guide--
                  (A) research and development, conducted or 
                supported by the Department of Health and Human 
                Services, of qualified countermeasures and 
                qualified pandemic or epidemic products against 
                possible biological, chemical, radiological, 
                and nuclear agents and to emerging infectious 
                diseases;
                  (B) innovation in technologies that may 
                assist advanced research and development of 
                qualified countermeasures and qualified 
                pandemic or epidemic products (such research 
                and development referred to in this section as 
                ``countermeasure and product advanced research 
                and development''); and
                  (C) procurement of such qualified 
                countermeasures and qualified pandemic or 
                epidemic products by such Department.
  (c) Biomedical Advanced Research and Development Authority.--
          (1) Establishment.--There is established within the 
        Department of Health and Human Services the Biomedical 
        Advanced Research and Development Authority.
          (2) In general.--Based upon the strategic plan 
        described in subsection (b), the Secretary shall 
        coordinate the acceleration of countermeasure and 
        product advanced research and development by--
                  (A) facilitating collaboration between the 
                Department of Health and Human Services and 
                other Federal agencies, relevant industries, 
                academia, and other persons, with respect to 
                such advanced research and development;
                  (B) promoting countermeasure and product 
                advanced research and development;
                  (C) facilitating contacts between interested 
                persons and the offices or employees authorized 
                by the Secretary to advise such persons 
                regarding requirements under the Federal Food, 
                Drug, and Cosmetic Act and under section 351 of 
                this Act; and
                  (D) promoting innovation to reduce the time 
                and cost of countermeasure and product advanced 
                research and development.
          (3) Director.--The BARDA shall be headed by a 
        Director (referred to in this section as the 
        ``Director'') who shall be appointed by the Secretary 
        and to whom the Secretary shall delegate such functions 
        and authorities as necessary to implement this section.
          (4) Duties.--
                  (A) Collaboration.--To carry out the purpose 
                described in paragraph (2)(A), the Secretary 
                shall--
                          (i) facilitate and increase the 
                        expeditious and direct communication 
                        between the Department of Health and 
                        Human Services and relevant persons 
                        with respect to countermeasure and 
                        product advanced research and 
                        development, including by--
                                  (I) facilitating such 
                                communication regarding the 
                                processes for procuring such 
                                advanced research and 
                                development with respect to 
                                qualified countermeasures and 
                                qualified pandemic or epidemic 
                                products of interest; and
                                  (II) soliciting information 
                                about and data from research on 
                                potential qualified 
                                countermeasures and qualified 
                                pandemic or epidemic products 
                                and related technologies;
                          (ii) at least annually--
                                  (I) convene meetings with 
                                representatives from relevant 
                                industries, academia, other 
                                Federal agencies, international 
                                agencies as appropriate, and 
                                other interested persons;
                                  (II) sponsor opportunities to 
                                demonstrate the operation and 
                                effectiveness of relevant 
                                biodefense countermeasure 
                                technologies; and
                                  (III) convene such working 
                                groups on countermeasure and 
                                product advanced research and 
                                development as the Secretary 
                                may determine are necessary to 
                                carry out this section; and
                          (iii) carry out the activities 
                        described in section 405 of the 
                        Pandemic and All-Hazards Preparedness 
                        Act.
                  (B) Support advanced research and 
                development.--To carry out the purpose 
                described in paragraph (2)(B), the Secretary 
                shall--
                          (i) conduct ongoing searches for, and 
                        support calls for, potential qualified 
                        countermeasures and qualified pandemic 
                        or epidemic products;
                          (ii) direct and coordinate the 
                        countermeasure and product advanced 
                        research and development activities of 
                        the Department of Health and Human 
                        Services;
                          (iii) establish strategic initiatives 
                        to accelerate countermeasure and 
                        product advanced research and 
                        development (which may include advanced 
                        research and development for purposes 
                        of fulfilling requirements under the 
                        Federal Food, Drug, and Cosmetic Act or 
                        section 351 of this Act) and innovation 
                        in such areas as the Secretary may 
                        identify as priority unmet need areas; 
                        and
                          (iv) award contracts, grants, 
                        cooperative agreements, and enter into 
                        other transactions, for countermeasure 
                        and product advanced research and 
                        development.
                  (C) Facilitating advice.--To carry out the 
                purpose described in paragraph (2)(C) the 
                Secretary shall--
                          (i) connect interested persons with 
                        the offices or employees authorized by 
                        the Secretary to advise such persons 
                        regarding the regulatory requirements 
                        under the Federal Food, Drug, and 
                        Cosmetic Act and under section 351 of 
                        this Act related to the approval, 
                        clearance, or licensure of qualified 
                        countermeasures or qualified pandemic 
                        or epidemic products; and
                          (ii) with respect to persons 
                        performing countermeasure and product 
                        advanced research and development 
                        funded under this section, enable such 
                        offices or employees to provide to the 
                        extent practicable such advice in a 
                        manner that is ongoing and that is 
                        otherwise designed to facilitate 
                        expeditious development of qualified 
                        countermeasures and qualified pandemic 
                        or epidemic products that may achieve 
                        such approval, clearance, or licensure.
                  (D) Supporting innovation.--To carry out the 
                purpose described in paragraph (2)(D), the 
                Secretary may award contracts, grants, and 
                cooperative agreements, or enter into other 
                transactions, such as prize payments, to 
                promote--
                          (i) innovation in technologies that 
                        may assist countermeasure and product 
                        advanced research and development;
                          (ii) research on and development of 
                        research tools and other devices and 
                        technologies; and
                          (iii) research to promote strategic 
                        initiatives, such as rapid diagnostics, 
                        broad spectrum antimicrobials, vaccine-
                        manufacturing technologies, dose-
                        sparing technologies, efficacy-
                        increasing technologies, and platform 
                        technologies.
          (5) Transaction authorities.--
                  (A) Other transactions.--
                          (i) In general.--The Secretary shall 
                        have the authority to enter into other 
                        transactions under this subsection in 
                        the same manner as the Secretary of 
                        Defense enters into such transactions 
                        under section 2371 of title 10, United 
                        States Code.
                          (ii) Limitations on authority.--
                                  (I) In general.--Subsections 
                                (b), (c), and (h) of section 
                                845 of the National Defense 
                                Authorization Act for Fiscal 
                                Year 1994 (10 U.S.C. 2371 note) 
                                shall apply to other 
                                transactions under this 
                                subparagraph as if such 
                                transactions were for prototype 
                                projects described by 
                                subsection (a) of such section 
                                845.
                                  (II) Written determinations 
                                required.--The authority of 
                                this subparagraph may be 
                                exercised for a project that is 
                                expected to cost the Department 
                                of Health and Human Services in 
                                excess of $20,000,000 only upon 
                                a written determination by the 
                                senior procurement executive 
                                for the Department (as 
                                designated for purpose of 
                                section 16(c) of the Office of 
                                Federal Procurement Policy Act 
                                (41 U.S.C. 414(c))), that the 
                                use of such authority is 
                                essential to promoting the 
                                success of the project. The 
                                authority of the senior 
                                procurement executive under 
                                this subclause may not be 
                                delegated.
                          (iii) Guidelines.--The Secretary 
                        shall establish guidelines regarding 
                        the use of the authority under clause 
                        (i). Such guidelines shall include 
                        auditing requirements.
                  (B) Expedited authorities.--
                          (i) In general.--In awarding 
                        contracts, grants, and cooperative 
                        agreements, and in entering into other 
                        transactions under subparagraph (B) or 
                        (D) of paragraph (4), the Secretary 
                        shall have the expedited procurement 
                        authorities, the authority to expedite 
                        peer review, and the authority for 
                        personal services contracts, supplied 
                        by subsections (b), (c), and (d) of 
                        section 319F-1.
                          (ii) Application of provisions.--
                        Provisions in such section 319F-1 that 
                        apply to such authorities and that 
                        require institution of internal 
                        controls, limit review, provide for 
                        Federal Tort Claims Act coverage of 
                        personal services contractors, and 
                        commit decisions to the discretion of 
                        the Secretary shall apply to the 
                        authorities as exercised pursuant to 
                        this paragraph.
                          (iii) Authority to limit 
                        competition.--For purposes of applying 
                        section 319F-1(b)(1)(D) to this 
                        paragraph, the phrase ``BioShield 
                        Program under the Project BioShield Act 
                        of 2004'' shall be deemed to mean the 
                        countermeasure and product advanced 
                        research and development program under 
                        this section.
                          (iv) Availability of data.--The 
                        Secretary shall require that, as a 
                        condition of being awarded a contract, 
                        grant, cooperative agreement, or other 
                        transaction under subparagraph (B) or 
                        (D) of paragraph (4), a person make 
                        available to the Secretary on an 
                        ongoing basis, and submit upon request 
                        to the Secretary, all data related to 
                        or resulting from countermeasure and 
                        product advanced research and 
                        development carried out pursuant to 
                        this section.
                  (C) Advance payments; advertising.--The 
                Secretary may waive the requirements of section 
                3324(a) of title 31, United States Code, or 
                section 3709 of the Revised Statutes of the 
                United States (41 U.S.C. 5) upon the 
                determination by the Secretary that such waiver 
                is necessary to obtain countermeasures or 
                products under this section.
                  (D) Milestone-based payments allowed.--In 
                awarding contracts, grants, and cooperative 
                agreements, and in entering into other 
                transactions, under this section, the Secretary 
                may use milestone-based awards and payments.
                  (E) Foreign nationals eligible.--The 
                Secretary may under this section award 
                contracts, grants, and cooperative agreements 
                to, and may enter into other transactions with, 
                highly qualified foreign national persons 
                outside the United States, alone or in 
                collaboration with American participants, when 
                such transactions may inure to the benefit of 
                the American people.
                  (F) Establishment of research centers.--The 
                Secretary may assess the feasibility and 
                appropriateness of establishing, through 
                contract, grant, cooperative agreement, or 
                other transaction, an arrangement with an 
                existing research center in order to achieve 
                the goals of this section. If such an agreement 
                is not feasible and appropriate, the Secretary 
                may establish one or more federally-funded 
                research and development centers, or 
                university-affiliated research centers, in 
                accordance with section 303(c)(3) of the 
                Federal Property and Administrative Services 
                Act of 1949 (41 U.S.C. 253(c)(3)).
                  (G) Government purpose.--In awarding 
                contracts, grants, and cooperative agreements 
                under this section, the Secretary shall provide 
                a clear statement of defined Government purpose 
                related to activities included in subsection 
                (a)(6)(B) for a qualified countermeasure or 
                qualified pandemic or epidemic product.
                  (H) Contracting authority clarification.--The 
                Secretary shall delegate authority for 
                negotiating and entering into any contracts, 
                grants, or cooperative agreements under this 
                section to the Director.
          (6) At-risk individuals.--In carrying out the 
        functions under this section, the Secretary may give 
        priority to the advanced research and development of 
        qualified countermeasures and qualified pandemic or 
        epidemic products that are likely to be safe and 
        effective with respect to children, pregnant women, 
        elderly, and other at-risk individuals.
          (7) Personnel authorities.--
                  (A) Specially qualified scientific and 
                professional personnel.--
                          (i) In general.--In addition to any 
                        other personnel authorities, the 
                        Secretary may--
                                  (I) without regard to those 
                                provisions of title 5, United 
                                States Code, governing 
                                appointments in the competitive 
                                service, appoint highly 
                                qualified individuals to 
                                scientific or professional 
                                positions in BARDA, such as 
                                program managers, to carry out 
                                this section; and
                                  (II) compensate them in the 
                                same manner and subject to the 
                                same terms and conditions in 
                                which individuals appointed 
                                under section 9903 of such 
                                title are compensated, without 
                                regard to the provisions of 
                                chapter 51 and subchapter III 
                                of chapter 53 of such title 
                                relating to classification and 
                                General Schedule pay rates.
                          (ii) Manner of exercise of 
                        authority.--The authority provided for 
                        in this subparagraph shall be exercised 
                        subject to the same limitations 
                        described in section 319F-1(e)(2).
                          (iii) Term of appointment.--The term 
                        limitations described in section 
                        9903(c) of title 5, United States Code, 
                        shall apply to appointments under this 
                        subparagraph, except that the 
                        references to the ``Secretary'' and to 
                        the ``Department of Defense's national 
                        security missions'' shall be deemed to 
                        be to the Secretary of Health and Human 
                        Services and to the mission of the 
                        Department of Health and Human Services 
                        under this section.
                  (B) Special consultants.--In carrying out 
                this section, the Secretary may appoint special 
                consultants pursuant to section 207(f).
                  (C) Limitation.--
                          (i) In general.--The Secretary may 
                        hire up to 100 highly qualified 
                        individuals, or up to 50 percent of the 
                        total number of employees, whichever is 
                        less, under the authorities provided 
                        for in subparagraphs (A) and (B).
                          (ii) Report.--The Secretary shall 
                        report to Congress on a biennial basis 
                        on the implementation of this 
                        subparagraph.
  (d) Fund.--
          (1) Establishment.--There is established the 
        Biodefense Medical Countermeasure Development Fund, 
        which shall be available to carry out this section in 
        addition to such amounts as are otherwise available for 
        this purpose.
          (2) Funding.--To carry out the purposes of this 
        section, there is authorized to be appropriated to the 
        Fund $415,000,000 for each of fiscal years 2014 through 
        2018, such amounts to remain available until expended.
  (e) Inapplicability of Certain Provisions.--
          (1) Disclosure.--
                  (A) In general.--The Secretary shall withhold 
                from disclosure under section 552 of title 5, 
                United States Code, specific technical data or 
                scientific information that is created or 
                obtained during the countermeasure and product 
                advanced research and development carried out 
                under subsection (c) that reveals significant 
                and not otherwise publicly known 
                vulnerabilities of existing medical or public 
                health defenses against biological, chemical, 
                nuclear, or radiological threats. Such 
                information shall be deemed to be information 
                described in section 552(b)(3) of title 5, 
                United States Code.
                  (B) Review.--Information subject to 
                nondisclosure under subparagraph (A) shall be 
                reviewed by the Secretary every 5 years, or 
                more frequently as determined necessary by the 
                Secretary, to determine the relevance or 
                necessity of continued nondisclosure.
                  (C) Sunset.--This paragraph shall cease to 
                have force or effect on the date that is 12 
                years after the date of enactment of the 
                Pandemic and All-Hazards Preparedness Act.
          (2) Review.--Notwithstanding section 14 of the 
        Federal Advisory Committee Act, a working group of 
        BARDA under this section and the National Biodefense 
        Science Board under section 319M shall each terminate 
        on the date that is 5 years after the date on which 
        each such group or Board, as applicable, was 
        established. Such 5-year period may be extended by the 
        Secretary for one or more additional 5-year periods if 
        the Secretary determines that any such extension is 
        appropriate.
  (f) Independent Evaluation.--
          (1) In general.--Not later than 180 days after the 
        date of enactment of this subsection, the Comptroller 
        General of the United States shall conduct an 
        independent evaluation of the activities carried out to 
        facilitate flexible manufacturing capacity pursuant to 
        this section.
          (2) Report.--Not later than 1 year after the date of 
        enactment of this subsection, the Comptroller General 
        of the United States shall submit to the appropriate 
        committees of Congress a report concerning the results 
        of the evaluation conducted under paragraph (1). Such 
        report shall review and assess--
                  (A) the extent to which flexible 
                manufacturing capacity under this section is 
                dedicated to chemical, biological, 
                radiological, and nuclear threats;
                  (B) the activities supported by flexible 
                manufacturing initiatives; and
                  (C) the ability of flexible manufacturing 
                activities carried out under this section to--
                          (i) secure and leverage leading 
                        technical expertise with respect to 
                        countermeasure advanced research, 
                        development, and manufacturing 
                        processes; and
                          (ii) meet the surge manufacturing 
                        capacity needs presented by novel and 
                        emerging threats, including chemical, 
                        biological, radiological, and nuclear 
                        agents.

           *       *       *       *       *       *       *


   TITLE XXVIII--NATIONAL ALL-HAZARDS PREPAREDNESS FOR PUBLIC HEALTH 
EMERGENCIES

           *       *       *       *       *       *       *


      Subtitle B--All-Hazards Emergency Preparedness and Response

SEC. 2811. COORDINATION OF PREPAREDNESS FOR AND RESPONSE TO ALL-HAZARDS 
                    PUBLIC HEALTH EMERGENCIES.

  (a) In General.--There is established within the Department 
of Health and Human Services the position of the Assistant 
Secretary for Preparedness and Response. The President, with 
the advice and consent of the Senate, shall appoint an 
individual to serve in such position. Such Assistant Secretary 
shall report to the Secretary.
  (b) Duties.--Subject to the authority of the Secretary, the 
Assistant Secretary for Preparedness and Response shall carry 
out the following functions:
          (1) Leadership.--Serve as the principal advisor to 
        the Secretary on all matters related to Federal public 
        health and medical preparedness and response for public 
        health emergencies.
          (2) Personnel.--Register, credential, organize, 
        train, equip, and have the authority to deploy Federal 
        public health and medical personnel under the authority 
        of the Secretary, including the National Disaster 
        Medical System, and coordinate such personnel with the 
        Medical Reserve Corps and the Emergency System for 
        Advance Registration of Volunteer Health Professionals.
          (3) Countermeasures.--Oversee advanced research, 
        development, and procurement of qualified 
        countermeasures (as defined in section 319F-1), 
        security countermeasures (as defined in section 319F-
        2), and qualified pandemic or epidemic products (as 
        defined in section 319F-3).
          (4) Coordination.--
                  (A) Federal integration.--Coordinate with 
                relevant Federal officials to ensure 
                integration of Federal preparedness and 
                response activities for public health 
                emergencies.
                  (B) State, local, and tribal integration.--
                Coordinate with State, local, and tribal public 
                health officials, the Emergency Management 
                Assistance Compact, health care systems, and 
                emergency medical service systems to ensure 
                effective integration of Federal public health 
                and medical assets during a public health 
                emergency.
                  (C) Emergency medical services.--Promote 
                improved emergency medical services medical 
                direction, system integration, research, and 
                uniformity of data collection, treatment 
                protocols, and policies with regard to public 
                health emergencies.
                  (D) Policy coordination and strategic 
                direction.--Provide integrated policy 
                coordination and strategic direction with 
                respect to all matters related to Federal 
                public health and medical preparedness and 
                execution and deployment of the Federal 
                response for public health emergencies and 
                incidents covered by the National Response Plan 
                developed pursuant to section 504(6) of the 
                Homeland Security Act of 2002, or any successor 
                plan, before, during, and following public 
                health emergencies.
                  (E) Identification of inefficiencies.--
                Identify and minimize gaps, duplication, and 
                other inefficiencies in medical and public 
                health preparedness and response activities and 
                the actions necessary to overcome these 
                obstacles.
                  (F) Coordination of grants and agreements.--
                Align and coordinate medical and public health 
                grants and cooperative agreements as applicable 
                to preparedness and response activities 
                authorized under this Act, to the extent 
                possible, including program requirements, 
                timelines, and measurable goals, and in 
                consultation with the Secretary of Homeland 
                Security, to--
                          (i) optimize and streamline medical 
                        and public health preparedness and 
                        response capabilities and the ability 
                        of local communities to respond to 
                        public health emergencies; and
                          (ii) gather and disseminate best 
                        practices among grant and cooperative 
                        agreement recipients, as appropriate.
                  (G) Drill and operational exercises.--Carry 
                out drills and operational exercises, in 
                consultation with the Department of Homeland 
                Security, the Department of Defense, the 
                Department of Veterans Affairs, and other 
                applicable Federal departments and agencies, as 
                necessary and appropriate, to identify, inform, 
                and address gaps in and policies related to 
                all-hazards medical and public health 
                preparedness and response, including exercises 
                based on--
                          (i) identified threats for which 
                        countermeasures are available and for 
                        which no countermeasures are available; 
                        and
                          (ii) unknown threats for which no 
                        countermeasures are available.
                  (H) National security priority.--On a 
                periodic basis consult with, as applicable and 
                appropriate, the Assistant to the President for 
                National Security Affairs, to provide an update 
                on, and discuss, medical and public health 
                preparedness and response activities pursuant 
                to this Act and the Federal Food, Drug, and 
                Cosmetic Act, including progress on the 
                development, approval, clearance, and licensure 
                of medical countermeasures.
          (5) Logistics.--In coordination with the Secretary of 
        Veterans Affairs, the Secretary of Homeland Security, 
        the General Services Administration, and other public 
        and private entities, provide logistical support for 
        medical and public health aspects of Federal responses 
        to public health emergencies.
          (6) Leadership.--Provide leadership in international 
        programs, initiatives, and policies that deal with 
        public health and medical emergency preparedness and 
        response.
          (7) Countermeasures budget plan.--Develop, and update 
        on an annual basis, a coordinated 5-year budget plan 
        based on the medical countermeasure priorities 
        described in subsection (d). Each such plan shall--
                  (A) include consideration of the entire 
                medical countermeasures enterprise, including--
                          (i) basic research and advanced 
                        research and development;
                          (ii) approval, clearance, licensure, 
                        and authorized uses of products; and
                          (iii) procurement, stockpiling, 
                        maintenance, and replenishment of all 
                        products in the Strategic National 
                        Stockpile;
                  (B) inform prioritization of resources and 
                include measurable outputs and outcomes to 
                allow for the tracking of the progress made 
                toward identified priorities;
                  (C) identify medical countermeasure life-
                cycle costs to inform planning, budgeting, and 
                anticipated needs within the continuum of the 
                medical countermeasure enterprise consistent 
                with section 319F-2; and
                  (D) be made available to the appropriate 
                committees of Congress upon request.
  (c) Functions.--The Assistant Secretary for Preparedness and 
Response shall--
          (1) have lead responsibility within the Department of 
        Health and Human Services for emergency preparedness 
        and response policy coordination and strategic 
        direction;
          (2) have authority over and responsibility for--
                  (A) the National Disaster Medical System 
                pursuant to section 2812;
                  (B) the Hospital Preparedness Cooperative 
                Agreement Program pursuant to section 319C-2;
                  (C) the Biomedical Advanced Research and 
                Development Authority pursuant to section 319L;
                  (D) the Medical Reserve Corps pursuant to 
                section 2813;
                  (E) the Emergency System for Advance 
                Registration of Volunteer Health Professionals 
                pursuant to section 319I; and
                  (F) administering grants and related 
                authorities related to trauma care under parts 
                A through C of title XII, such authority to be 
                transferred by the Secretary from the 
                Administrator of the Health Resources and 
                Services Administration to such Assistant 
                Secretary;
          (3) exercise the responsibilities and authorities of 
        the Secretary with respect to the coordination of--
                  (A) the Public Health Emergency Preparedness 
                Cooperative Agreement Program pursuant to 
                section 319C-1;
                  (B) the Strategic National Stockpile pursuant 
                to section 319F-2; and
                  (C) the Cities Readiness Initiative; and
          (4) assume other duties as determined appropriate by 
        the Secretary.
  (d) Public Health Emergency Medical Countermeasures 
Enterprise Strategy and Implementation Plan.--
          (1) In general.--Not later than 180 days after the 
        date of enactment of this subsection, and every year 
        thereafter, the Assistant Secretary for Preparedness 
        and Response shall develop and submit to the 
        appropriate committees of Congress a coordinated 
        strategy and accompanying implementation plan for 
        medical countermeasures to address chemical, 
        biological, radiological, and nuclear threats. In 
        developing such a plan, the Assistant Secretary for 
        Preparedness and Response shall consult with the 
        Director of the Biomedical Advanced Research and 
        Development Authority, the Director of the National 
        Institutes of Health, the Director of the Centers for 
        Disease Control and Prevention, and the Commissioner of 
        Food and Drugs. Such strategy and plan shall be known 
        as the ``Public Health Emergency Medical 
        Countermeasures Enterprise Strategy and Implementation 
        Plan''.
          (2) Requirements.--The plan under paragraph (1) 
        shall--
                  (A) describe the chemical, biological, 
                radiological, and nuclear agent or agents that 
                may present a threat to the Nation (which shall 
                include pandemic influenza) and the 
                corresponding efforts to develop qualified 
                countermeasures (as defined in section 319F-1), 
                security countermeasures (as defined in section 
                319F-2), or qualified pandemic or epidemic 
                products (as defined in section 319F-3) for 
                each threat;
                  (B) evaluate the progress of all activities 
                with respect to such countermeasures or 
                products, including research, advanced 
                research, development, procurement, 
                stockpiling, deployment, distribution, and 
                utilization;
                  (C) identify and prioritize near-, mid-, and 
                long-term needs with respect to such 
                countermeasures or products to address a 
                chemical, biological, radiological, and nuclear 
                threat or threats;
                  (D) identify, with respect to each category 
                of threat, a summary of all awards and 
                contracts, including advanced research and 
                development and procurement, that includes--
                          (i) the time elapsed from the 
                        issuance of the initial solicitation or 
                        request for a proposal to the 
                        adjudication (such as the award, denial 
                        of award, or solicitation termination); 
                        and
                          (ii) an identification of projected 
                        timelines, anticipated funding 
                        allocations, benchmarks, and milestones 
                        for each medical countermeasure 
                        priority under subparagraph (C), 
                        including projected needs with regard 
                        to replenishment of the Strategic 
                        National Stockpile;
                  (E) be informed by the recommendations of the 
                National Biodefense Science Board pursuant to 
                section 319M;
                  (F) evaluate progress made in meeting 
                timelines, allocations, benchmarks, and 
                milestones identified under subparagraph 
                (D)(ii);
                  (G) report on the amount of funds available 
                for procurement in the special reserve fund as 
                defined in section 319F-2(h) and the impact 
                this funding will have on meeting the 
                requirements under section 319F-2;
                  (H) incorporate input from Federal, State, 
                local, and tribal stakeholders;
                  (I) identify the progress made in meeting the 
                medical countermeasure priorities for at-risk 
                individuals (as defined in 2802(b)(4)(B)), as 
                applicable under subparagraph (C), including 
                with regard to the projected needs for related 
                stockpiling and replenishment of the Strategic 
                National Stockpile, including by addressing the 
                needs of pediatric populations with respect to 
                such countermeasures and products in the 
                Strategic National Stockpile, including--
                          (i) a list of such countermeasures 
                        and products necessary to address the 
                        needs of pediatric populations;
                          (ii) a description of measures taken 
                        to coordinate with the Office of 
                        Pediatric Therapeutics of the Food and 
                        Drug Administration to maximize the 
                        labeling, dosages, and formulations of 
                        such countermeasures and products for 
                        pediatric populations;
                          (iii) a description of existing gaps 
                        in the Strategic National Stockpile and 
                        the development of such countermeasures 
                        and products to address the needs of 
                        pediatric populations; and
                          (iv) an evaluation of the progress 
                        made in addressing priorities 
                        identified pursuant to subparagraph 
                        (C);
                  (J) identify the use of authority and 
                activities undertaken pursuant to sections 
                319F-1(b)(1), 319F-1(b)(2), 319F-1(b)(3), 319F-
                1(c), 319F-1(d), 319F-1(e), 319F-
                2(c)(7)(C)(iii), 319F-2(c)(7)(C)(iv), and 319F-
                2(c)(7)(C)(v) of this Act, and subsections 
                (a)(1), (b)(1), and (e) of section 564 of the 
                Federal Food, Drug, and Cosmetic Act, by 
                summarizing--
                          (i) the particular actions that were 
                        taken under the authorities specified, 
                        including, as applicable, the 
                        identification of the threat agent, 
                        emergency, or the biomedical 
                        countermeasure with respect to which 
                        the authority was used;
                          (ii) the reasons underlying the 
                        decision to use such authorities, 
                        including, as applicable, the options 
                        that were considered and rejected with 
                        respect to the use of such authorities;
                          (iii) the number of, nature of, and 
                        other information concerning the 
                        persons and entities that received a 
                        grant, cooperative agreement, or 
                        contract pursuant to the use of such 
                        authorities, and the persons and 
                        entities that were considered and 
                        rejected for such a grant, cooperative 
                        agreement, or contract, except that the 
                        report need not disclose the identity 
                        of any such person or entity;
                          (iv) whether, with respect to each 
                        procurement that is approved by the 
                        President under section 319F-2(c)(6), a 
                        contract was entered into within one 
                        year after such approval by the 
                        President; and
                          (v) with respect to section 319F-
                        1(d), for the one-year period for which 
                        the report is submitted, the number of 
                        persons who were paid amounts totaling 
                        $100,000 or greater and the number of 
                        persons who were paid amounts totaling 
                        at least $50,000 but less than 
                        $100,000; [and]
                  (K) report on the amount of time between the 
                issuance of each request for a proposal or task 
                order from the Biomedical Advanced Research and 
                Development Authority and the award of a 
                contract pursuant to such request for a 
                proposal or task order; and
                  [(K)] (L) be made publicly available.
          (3) GAO report.--
                  (A) In general.--Not later than 1 year after 
                the date of the submission to the Congress of 
                the first Public Health Emergency Medical 
                Countermeasures Enterprise Strategy and 
                Implementation Plan, the Comptroller General of 
                the United States shall conduct an independent 
                evaluation, and submit to the appropriate 
                committees of Congress a report, concerning 
                such Strategy and Implementation Plan.
                  (B) Content.--The report described in 
                subparagraph (A) shall review and assess--
                          (i) the near-term, mid-term, and 
                        long-term medical countermeasure needs 
                        and identified priorities of the 
                        Federal Government pursuant to 
                        paragraph (2)(C);
                          (ii) the activities of the Department 
                        of Health and Human Services with 
                        respect to advanced research and 
                        development pursuant to section 319L; 
                        and
                          (iii) the progress made toward 
                        meeting the timelines, allocations, 
                        benchmarks, and milestones identified 
                        in the Public Health Emergency Medical 
                        Countermeasures Enterprise Strategy and 
                        Implementation Plan under this 
                        subsection.
  (e) Protection of National Security.--In carrying out 
subsections (b)(7) and (d), the Secretary shall ensure that 
information and items that could compromise national security, 
contain confidential commercial information, or contain 
proprietary information are not disclosed.

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                              ----------                              


                  FEDERAL FOOD, DRUG, AND COSMETIC ACT



           *       *       *       *       *       *       *
CHAPTER V--DRUGS AND DEVICES

           *       *       *       *       *       *       *


Subchapter E--General Provisions Relating to Drugs and Devices

           *       *       *       *       *       *       *


SEC. 565A. PRIORITY REVIEW TO ENCOURAGE TREATMENTS FOR AGENTS THAT 
                    PRESENT NATIONAL SECURITY THREATS.

  (a) Definitions.--In this section:
          (1) Priority review.--The term ``priority review'', 
        with respect to a human drug application as defined in 
        section 735(1), means review and action by the 
        Secretary on such application not later than 6 months 
        after receipt by the Secretary of such application, as 
        described in the manual of policies and procedures of 
        the Food and Drug Administration and goals identified 
        in the letters described in section 101(b) of the Food 
        and Drug Administration Safety and Innovation Act 
        (Public Law 112-144).
          (2) Priority review voucher.--The term ``priority 
        review voucher'' means a voucher issued by the 
        Secretary to the sponsor of a material threat medical 
        countermeasure application that entitles the holder of 
        such voucher to priority review of a single human drug 
        application submitted under section 505(b)(1) of this 
        Act or section 351(a) of the Public Health Service Act 
        after the date of approval of the material threat 
        medical countermeasure application.
          (3) Material threat medical countermeasure 
        application.--The term ``material threat medical 
        countermeasure application'' means an application 
        that--
                  (A) is a human drug application as defined in 
                section 735(1) to prevent, or treat harm from, 
                a biological, chemical, radiological, or 
                nuclear agent identified as a material threat 
                under section 319F-2(c)(2)(A)(ii) of the Public 
                Health Service Act;
                  (B) the Secretary deems eligible for priority 
                review;
                  (C) is approved after the date of enactment 
                of the Strengthening Public Health Emergency 
                Response Act of 2016; and
                  (D) is for a human drug, no active ingredient 
                (including any ester or salt of the active 
                ingredient) of which has been approved pursuant 
                to any other application under section 
                505(b)(1) of this Act or section 351(a) of the 
                Public Health Service Act.
  (b) Priority Review Voucher.--
          (1) In general.--The Secretary shall award a priority 
        review voucher to the sponsor of a material threat 
        medical countermeasure application upon approval by the 
        Secretary of such application.
          (2) Transferability.--
                  (A) In general.--The sponsor of a material 
                threat medical countermeasure application that 
                receives a priority review voucher under this 
                section may transfer (including by sale) the 
                entitlement to such voucher to a sponsor of a 
                human drug for which an application under 
                section 505(b)(1) of this Act or section 351(a) 
                of the Public Health Service Act will be 
                submitted after the date of the approval of the 
                material threat medical countermeasure 
                application. There is no limit on the number of 
                times a priority review voucher may be 
                transferred before such voucher is used.
                  (B) Notification of transfer.--Each person to 
                whom a voucher is transferred shall notify the 
                Secretary of such change in ownership of the 
                voucher not later than 30 days after the date 
                of such transfer.
          (3) Notification.--
                  (A) In general.--The sponsor of a human drug 
                application shall notify the Secretary not 
                later than 90 calendar days prior to submission 
                of the human drug application that is the 
                subject of a priority review voucher of an 
                intent to submit the human drug application, 
                including the date on which the sponsor intends 
                to submit the application. Such notification 
                shall be a legally binding commitment to pay 
                for the user fee to be assessed in accordance 
                with this section.
                  (B) Transfer after notice.--The sponsor of a 
                human drug application that provides 
                notification of the intent of such sponsor to 
                use the voucher for the human drug application 
                under subparagraph (A) may transfer the voucher 
                after such notification is provided, if such 
                sponsor has not yet submitted the human drug 
                application described in the notification.
  (c) Priority Review User Fee.--
          (1) In general.--The Secretary shall establish a user 
        fee program under which a sponsor of a human drug 
        application that is the subject of a priority review 
        voucher shall pay to the Secretary a fee determined 
        under paragraph (2). Such fee shall be in addition to 
        any fee required to be submitted by the sponsor under 
        chapter VII.
          (2) Fee amount.--The amount of the priority review 
        user fee shall be determined each fiscal year by the 
        Secretary and based on the average cost incurred by the 
        agency in the review of a human drug application 
        subject to priority review in the previous fiscal year.
          (3) Annual fee setting.--The Secretary shall 
        establish, before the beginning of each fiscal year 
        beginning after September 30, 2016, for that fiscal 
        year, the amount of the priority review user fee.
          (4) Payment.--
                  (A) In general.--The priority review user fee 
                required by this subsection shall be due upon 
                the notification by a sponsor of the intent of 
                such sponsor to use the voucher, as specified 
                in subsection (b)(3)(A). All other user fees 
                associated with the human drug application 
                shall be due as required by the Secretary or 
                under applicable law.
                  (B) Complete application.--An application 
                described in subparagraph (A) for which the 
                sponsor requests the use of a priority review 
                voucher shall be considered incomplete if the 
                fee required by this subsection and all other 
                applicable user fees are not paid in accordance 
                with the Secretary's procedures for paying such 
                fees.
                  (C) No waivers, exemptions, reductions, or 
                refunds.--The Secretary may not grant a waiver, 
                exemption, reduction, or refund of any fees due 
                and payable under this section.
          (5) Offsetting collections.--Fees collected pursuant 
        to this subsection for any fiscal year--
                  (A) shall be deposited and credited as 
                offsetting collections to the account providing 
                appropriations to the Food and Drug 
                Administration; and
                  (B) shall not be collected for any fiscal 
                year except to the extent provided in advance 
                in appropriation Acts.
  (d) Notice of Issuance of Voucher and Approval of Products 
Under Voucher.--The Secretary shall publish a notice in the 
Federal Register and on the public website of the Food and Drug 
Administration not later than 30 calendar days after the 
occurrence of each of the following:
          (1) The Secretary issues a priority review voucher 
        under this section.
          (2) The Secretary approves a drug pursuant to an 
        application submitted under section 505(b) of this Act 
        or section 351(a) of the Public Health Service Act for 
        which the sponsor of the application used a priority 
        review voucher under this section.
  (e) Eligibility for Other Programs.--Nothing in this section 
precludes a sponsor who seeks a priority review voucher under 
this section from participating in any other incentive program, 
including under this Act, except that no sponsor of a material 
threat medical countermeasure application may receive more than 
one priority review voucher issued under any section of this 
Act with respect to the drug that is the subject of such 
application.
  (f) Relation to Other Provisions.--The provisions of this 
section shall supplement, not supplant, any other provisions of 
this Act or the Public Health Service Act that encourage the 
development of medical countermeasures.
  (g) Medical Countermeasure Postapproval Report.--
          (1) In general.--Not later than 5 years after the 
        date of approval of a material threat medical 
        countermeasure application, the sponsor of such 
        application shall submit a report to the Secretary on 
        such medical countermeasure.
          (2) Contents.--A report under paragraph (1) shall 
        include, with respect to each of the first 2 years 
        after approval of such material threat medical 
        countermeasure application, a description of--
                  (A) the sponsor's activities with Federal 
                agencies related to the procurement, including 
                stockpiling, of the approved medical 
                countermeasure;
                  (B) the sponsor's progress in fulfilling 
                contracts entered into with Federal agencies, 
                including the Biomedical Advanced Research and 
                Development Authority, the Centers for Disease 
                Control and Prevention, and the Department of 
                Defense, related to such procurement;
                  (C) the extent to which the Federal 
                Government has fulfilled its stated medical 
                countermeasure requirements for the threat 
                intended to be treated by the approved medical 
                countermeasure; and
                  (D) the sponsor's plans, if any, to develop 
                additional material threat medical 
                countermeasures.
          (3) Availability to congressional committees.--The 
        Secretary shall make each report submitted under this 
        subsection available to the Committee on Energy and 
        Commerce of the House of Representatives and the 
        Committee on Health, Education, Labor, and Pensions of 
        the Senate upon request by either such Committee not 
        later than 30 days after receipt of such request.
          (4) Rule of construction.--Nothing in this subsection 
        shall be construed to permit the disclosure of 
        confidential commercial or trade secret information or 
        the disclosure of information that could compromise 
        national security.

           *       *       *       *       *       *       *


                            DISSENTING VIEWS

    We oppose the passage of H.R. 3299, the Strengthening 
Public Health Emergency Response Act of 2015, a bill that would 
make reforms to how the federal government acquires, procures, 
and develops medical countermeasures (MCMs) to prevent or treat 
biological threats. While this legislation attempts to address 
important recommendations on our nation's biodefense 
preparedness, we are concerned that it would not improve our 
nation's biodefense preparedness, includes policies that will 
undermine the Department of Health and Human Services' (HHS) 
oversight over biodefense contracting, and would further burden 
the Food and Drug Administration (FDA) by creating a new, 
permanent, and unnecessary priority review voucher (PRV) 
program to incentivize the development of MCMs without 
addressing underlying flaws inherent in this incentive program.

                             I. Background

    Following the September 11, 2001, terrorist attacks and the 
subsequent anthrax mailings, Congress passed legislation to 
address the threat of bioterrorism by increasing investments in 
research and preparedness to defend against biological 
weapons.\1\ Significant legislation included the Homeland 
Security Act of 2002 and the Pandemic and All-Hazards 
Preparedness Act (PAHPA) of 2006, which established new 
departments and agencies to address preparedness and 
bioterrorism response.\2\
---------------------------------------------------------------------------
    \1\Congressional Research Service, Federal Efforts to Address the 
Threat of Bioterrorism: Selected Issues and Options for Congress (Feb. 
8, 2011) (R41123).
    \2\Id.
---------------------------------------------------------------------------
    Earlier this year the Subcommittee on Oversight and 
Investigations heard from members of the Blue Ribbon Panel on 
Biodefense and other experts about the current status of the 
United States' biodefense preparedness. A report released by 
the Blue Ribbon Panel on October 28, 2015, found:

          The nation has not come to fully appreciate the 
        severity of the biological threat and our leaders have 
        not demonstrated the political will to fully address 
        it. We must address these shortcomings by prioritizing 
        the following areas: 1) coordination and accountability 
        among federal departments and agencies; 2) 
        collaboration between federal and non-federal 
        stakeholders; and 3) innovation that addresses both 
        lingering and novel problems.''\3\
---------------------------------------------------------------------------
    \3\Bipartisan Report of the Blue Ribbon Study Panel on Biodefense, 
A National Blueprint for Biodefense: Leadership and Major Reform Needed 
to Optimize Efforts (Oct. 2015).

    Further, the report found that the United States ``does not 
afford the biological threat the same level of attention as it 
does other threats.''\4\ This comprehensive review also offered 
33 recommendations about how Congress and the Administration 
can improve our preparedness. H.R. 3299 was introduced in 
response to this report and includes provisions meant to 
address these recommendations, such as: putting in place 
procedures to coordinate the ongoing stockpiling of medical 
countermeasures by the Biomedical Advanced Research and 
Development Authority (BARDA) and the Centers for Disease 
Control and Prevention; providing BARDA with direct contracting 
authority; requiring a report by the Government Accountability 
Office (GAO) on programs for public health emergency 
preparedness; and creating a PRV program, which would award a 
voucher to the sponsor of a new drug or biological product to 
treat a material threat that entitles the sponsor to a six 
month review of any future new drug or biological product 
application of the sponsor's choosing.
---------------------------------------------------------------------------
    \4\Id.
---------------------------------------------------------------------------
    While legislative efforts to increase our nation's 
preparedness and response to biological threats have 
historically enjoyed bipartisan support, H.R. 3299 fails to 
address concerns raised by the Administration regarding 
provisions that would limit oversight over contracting 
authority and would create a burdensome incentive program 
without addressing flaws in the underlying program's structure.

II. H.R. 3299: A Misguided Attempt To Reform Biodefense Contracting and 
                   Medical Countermeasure Development

A. H.R. 3299 REVISES BARDA TRANSACTION AUTHORITIES, UNDERMINING PROGRAM 
                               INTEGRITY

    H.R. 3299 would grant BARDA the authority to directly 
negotiate and enter into contracts, grants, or cooperative 
agreements. The change to BARDA's contracting structure 
proposed by H.R. 3299 raises concerning program integrity 
issues. Currently, BARDA enters into contracts through the 
Office of Acquisition, Management, Contracts, and Grants (AMCG) 
and the Assistant Secretary for Preparedness and Response 
(ASPR) Office, its parent organization. This structure protects 
the integrity of the contracting process. The delegation of the 
function to negotiate and enter into contracts, grants, and 
cooperative agreements to the BARDA Director could result in 
the federal government not getting the best value for taxpayer 
dollars.
    After Secretary Sebelius provided Congress with notice and 
published the required announcement in the Federal Registrar in 
2010, contracting offices were removed from BARDA and other 
divisional entities within ASPR and consolidated into the AMCG 
along with other ASPR-wide reorganization efforts. The 
restructuring of the contract offices was done to streamline 
ASPR's contracting activity, to bolster program integrity, and 
to ensure that ASPR and all of its operating divisions conduct 
their business without either the perception or potentially the 
reality of undue influence by program officials. The 
restructuring also allowed the AMCG to get Head of Contracting 
Activity (HCA)--an authority that allows a contracting office 
to be a self-fulfilling, self-managed contracting office. This 
designation removed the need for the contracting office to go 
through an additional layer of approval at the departmental 
level before a contract could be completed. The current 
structure, which is consistent with procurement practices 
across the federal government, ensures the right balance 
between expert scientists that advance our national 
preparedness and expert contracting professionals that ensure 
the government is getting the best value for every taxpayer 
dollar.
    The integrity-minded structure established by the ASPR in 
2010 has not only contributed to a steadily improved 
contracting process but also one that has successfully 
withstood the few protests presented to the organization. The 
existence of undue influence could potentially compel a 
contracting officer to do something unethical or illegal at the 
direction of the BARDA director because they worry that the 
BARDA director, who would ultimately control their performance 
appraisal and promotions, might take adverse action against 
them. Overpaying for the research and development of medical 
countermeasures or for some products could limit our ability to 
enter into advanced development and procurement contracts for 
new medical countermeasures since only finite resources are 
available. This could weaken our preparedness for public health 
emergencies and protection against terrorist attacks by 
limiting the number of medical countermeasures we have in the 
pipeline to respond to chemical, biological, radiological, and 
nuclear (CBRN) threats as well as other public health threats.

           1. Potentially Slows Down the Contracting Process

    The changes proposed by H.R. 3299 could result in the 
contracting office losing its HCA designation, which would be 
consistent with the operation of the contracting office prior 
to its placement under ASPR. Since the reorganization of ASPR, 
which consolidated organization-wide contracting activities in 
the AMCG Office at ASPR, BARDA has experienced an acceleration 
in the delivery of medical countermeasures. For example, of the 
total 23 products that BARDA has supported that received FDA 
approval, licensure, or clearance, 14 of those approvals have 
occurred since 2011 and five have occurred in the last 16 
months. BARDA is also currently supporting a pipeline of over 
100 more.
    If the contracting office loses that designation, BARDA 
contracts could be forced to go through an additional layer of 
approval at the department level that is not required by the 
current structure. As a result, the pace at which BARDA 
completes contracts is likely to slow down. This would be 
counter to the stated goals of this change and harm our ability 
to accelerate medical countermeasure development.

 B. H.R. 3299 EXTENDS AN UNNECESSARY, UNPROVEN, AND INHERENTLY FLAWED 
                  INCENTIVE TO MEDICAL COUNTERMEASURES

    As passed by the Committee, H.R. 3299 creates a new 
standalone and permanent PRV program for MCMs. The new 
permanent MCM PRV program would require FDA to review within 
six months any human drug application that is: (1) approved to 
prevent or treat harm from a material threat listed in section 
319F-2(c)(2)(A)(ii) of the Public Health Service Act; (2) 
eligible for priority review; (3) approved after the date of 
enactment of H.R. 3299; and, (4) includes no active ingredient 
previously approved by FDA.\5\ If FDA approves such an 
application, the agency must award the sponsor a PRV which 
entitles its holder to a second six-month priority review of 
any other human drug application (the standard drug review time 
is ten months). A company awarded a PRV can redeem the voucher 
for expedited review of its own product, or transfer or sell 
the PRV to another company. The only requirement is that a 
company redeeming a PRV must provide FDA with 90 days advanced 
notice of its intent to redeem and pay FDA a priority review 
user fee to help offset the costly and resource-intensive 
priority review. The creation of this incentive is meant to 
spur continued and future development of MCMs.
---------------------------------------------------------------------------
    \5\H.R. 3299, Section 7.
---------------------------------------------------------------------------

  1. Existing Authorities and Incentives Sufficient to Encourage MCM 
                              Development

    While MCMs play an important role in our national security, 
H.R. 3299 extends an unnecessary incentive to drug companies. 
Companies that produce MCMs often receive significant federal 
support throughout the drug research and development, approval, 
and procurement process. A 2014 Congressional Research Service 
(CRS) report stated that, since 2004, the federal government 
has spent over $3 billion procuring MCMs.\6\ Further, in 
addition to the billions spent post-approval by the government 
to purchase these products for stockpiling, lucrative federal 
contracts often support research and development of these 
drugs.\7\
---------------------------------------------------------------------------
    \6\Congressional Research Service, The Project BioShield Act: 
Issues for the 113th Congress (June 18, 2014) (R43607).
    \7\For example, in the 2015 President's Budget, HHS reported it 
would spend over $830 million during the 2015 fiscal year to support 
medical countermeasure research, development, and procurement through 
BARDA and Project BioShield. Department of Health and Human Services, 
FY2015 Budget in Brief, (June 4, 2014) (www.hhs.gov/about/budget/
fy2015/budget-in-brief/phssef/index.html#).
---------------------------------------------------------------------------
    FDA also devotes significant taxpayer funded resources to 
assist MCM sponsors throughout the drug development and 
approval process. For example, in fiscal year 2015 alone, FDA 
held 84 formal meetings with MCM developers or applicants to 
provide technical assistance or clarify regulatory 
requirements.\8\ Since 2000, FDA has approved 89 medical 
countermeasures, 17 supplemental changes to already approved 
applications, and 71 modifications to diagnostic devices.\9\ 
Drug companies developing MCMs also often utilize existing 
government research and develop and produce MCMs in government-
funded research facilities and production 
sites.10,11 The large number of approved MCMs and 
strong regulatory support demonstrate that sufficient 
incentives currently exist for investments in MCM development. 
Providing an additional incentive of a PRV, the last of which 
sold for $350 million, is unnecessary and will amount to a 
windfall for many drug companies at the expense of American 
taxpayers.
---------------------------------------------------------------------------
    \8\House Committee on Energy and Commerce, Testimony of Michael 
Mair, Director of Strategic Operations, Food and Drug Administration, 
Hearing on Examining H.R. 3299, Strengthening Public Health Response 
Act, 114th Cong. (May 19, 2016)
    \9\Id.
    \10\Department of Health and Human Services, Department Of Health 
And Human Services' Centers for Innovation in Advanced Development and 
Manufacturing (HHS-CIADM) (www.medicalcountermeasures.gov/barda/core-
services/ciadm.aspx).
    \11\Nanotherapeutics Celebrates Groundbreaking of its Advanced 
Development and Manufacturing Center (NANO-ADM) in Copeland Park, 
Alachua, FL, Business Wire (Oct. 23, 2013) (www.businesswire.com/news/
home/20131023005120/en/Nanotherapeutics-Celebrates-Groundbreaking-
Advanced-Development-Manufacturing-Center).
---------------------------------------------------------------------------

                 2. Lack of Evidence PRV Programs Work

    It is unclear if existing PRV programs are having the 
intended effect of incentivizing investment in new research and 
development of drugs. At the May 19, 2016 Subcommittee on 
Health hearing on H.R. 3299, FDA testified that, to date, there 
is no evidence that the two existing PRV programs (rare 
pediatric diseases and neglected tropical diseases) are 
incentivizing new research and drug development, or benefiting 
those Congress intended.\12\ For example, of the three PRVs 
awarded under the tropical disease PRV program, two were 
awarded to drugs that had been used for years outside the 
United States. One drug was approved in over 80 countries 
before the sponsor filed an application with FDA--an 
application that included only studies conducted before 2007 to 
obtain approval outside the United States.\13\ The second drug 
was registered outside the United States for over a decade 
before an application was filed with FDA and the filed 
application only included studies conducted by a company that 
previously owned the drug.\14\ However, under the terms of the 
program, FDA was forced to award two PRVs--one to a company 
that conducted no new research, and one to a company that 
conducted no research at all. Further, in the tropical disease 
PRV program, people afflicted with the disease have been unable 
to access approved drugs because, unlike the rare pediatric PRV 
program, there is no requirement that a sponsor market its drug 
after receiving the valuable PRV award in the tropical disease 
context. The underlying problems identified in the tropical 
disease PRV program have not been addressed in the creation of 
the MCM PRV program in H.R. 3299. H.R. 3299 does not limit a 
PRV award only to companies that invest in new drug research 
and development, and does not require a company that receives a 
PRV to produce and make the MCM available to the U.S. 
government for stockpiling purposes.
---------------------------------------------------------------------------
    \12\House Committee on Energy and Commerce, Testimony of Michael 
Mair, Director of Strategic Operations, Food and Drug Administration, 
Hearing on Examining H.R. 3299, Strengthening Public Health Response 
Act, 114th Cong. (May 19, 2016)
    \13\Tatum Anderson, Novartis Under Fire for Accepting New Reward 
for Old Drug, Lancet (Apr. 25, 2009).
    \14\Aaron S. Kesselheim et al., Experience With the Priority Review 
Voucher Program for Drug Development, JAMA (Oct. 27, 2015)
---------------------------------------------------------------------------

  3. Proposed New PRV Program Does Not Meaningfully Limit Eligibility

    Under H.R. 3299, FDA must approve a new drug application 
(NDA) for a drug to treat a material threat that: (1) qualifies 
for a six-month priority review;\15\ (2) is approved after the 
date of enactment; and (3) contains no active ingredient 
previously approved by FDA. If the sponsor's NDA meets these 
qualifications and is approved by FDA, the sponsor is then 
eligible for a PRV. The program created in the H.R. 3299 AINS 
does not preclude PRV awards to drug companies:
---------------------------------------------------------------------------
    \15\There is a set criteria FDA must adhere to when designating a 
drug as eligible for priority review and this should not be viewed as 
giving FDA significant discretion in determining PRV eligibility. To 
qualify for priority review, a drug must treat a serious condition 
(e.g., a material threat) and demonstrate only potential to be a 
significant improvement in safety or effectiveness. After receiving a 
request for a priority review designation, FDA only has 60 days to make 
this determination.
---------------------------------------------------------------------------
           With drug applications currently under 
        review at FDA;
           That previously received approval of the MCM 
        outside the United States; and,
           That are developing drugs that do not 
        fulfill an existing federal government need (e.g., 
        developing drugs for which there is an existing 
        treatment in the strategic national stockpile).
    Without appropriate safeguards, it is unclear that H.R. 
3299 would appropriately award PRVs to new MCMs that are needed 
by the federal government, and could instead further flood the 
market with PRVs for products that may not be novel or 
necessary from a national preparedness perspective. This could 
have the unintended consequence of reducing the value of PRVs 
overall and thereby disincentivize development of new drugs 
under all PRV programs.

  4. Creation of a New PRV Program Could Undermine FDA's Drug Review 
                   Process and Public Health Mission

    Generally, FDA will grant a six-month priority review to 
drug applications that have potential to improve public health, 
such as a drug that will address an unmet medical need. 
However, PRVs awarded under the tropical and rare pediatric 
disease programs can be used to expedite review of a drug 
application that otherwise would not qualify. PRV programs 
essentially allow a drug sponsor to purchase a priority review 
at the expense of other public health priorities. Increasing 
the burden on FDA to expedite review of more applications with 
limited public health value undermines FDA's ability to fulfill 
its mission, manage its drug review workload, and threatens 
staff morale.
    FDA drug product reviewers are organized into divisions 
that specialize in reviewing specific drug classes. Drug 
reviewers cannot be ``reassigned'' to assist another division 
in reviewing an application submitted for expedited review 
(e.g., a reviewer trained to review oncology drugs cannot be 
reassigned to help expedite review of a weight loss drug 
submitted with a PRV). A drug company utilizing a PRV must only 
provide FDA with 90 days' notice before submitting the new drug 
application for priority review, preventing FDA from hiring and 
training staff necessary to expedite review of applications 
submitted with a PRV. As a result, when a company redeems a 
PRV, FDA must divert resources from existing work to expedite 
review of a drug that may, under normal circumstances, be a 
lower priority. In addition, a new drug application that 
qualifies for the standard ten-month review generally is 
supported by large data sets that take FDA reviewers 
significant time to evaluate. When such an application is 
submitted with a PRV, it places a significant strain on FDA 
resources by reducing the time an FDA reviewer has to perform 
important work from ten to six months.
    Some supporters of the new PRV program included in H.R. 
3299 have suggested that this incentive comes at no cost to the 
taxpayer. However, expediting review of new drug applications 
that would not ordinarily qualify for priority review, places 
an enormous strain on FDA's resources. This costs taxpayers 
money since it is tax dollars that fund this additional work. 
Additionally, it costs the American public when access to new 
drugs is delayed because a drug company ``skipped the line'' 
with a PRV and delayed FDA approval of other important drugs.

 5. Expanding Eligibility for PRVs to MCMs May Diminish the Value for 
                Tropical Disease and Rare Pediatric PRVs

    David Ridley, the architect of the PRV program, cautioned 
against expanding the program to include MCMs. In a letter 
submitted for the record at the May 19, 2016, hearing on H.R. 
3299, Mr. Ridley stated that such expansion could reduce the 
value of a PRV, as increasing the number of available PRVs 
would sharply decrease the expected price. This would make a 
PRV not only an ineffective incentive to develop MCMs, but also 
have the unintended consequence of disincentivizing development 
of drugs to treat rare pediatric and neglected tropical 
diseases as well. Mr. Ridley stated:

          Viewed in isolation, it makes perfect sense to add 
        medical countermeasures to the diseases eligible for 
        priority review vouchers. However, members of Congress 
        should be aware that adding voucher-eligible diseases 
        will drive down the price of vouchers and thus drive 
        down the incentive to develop treatments for diseases 
        already on the list. In the current issue of Health 
        Affairs, my coauthor and I estimated that if one 
        voucher is available in a year, it will be worth more 
        than $200 million, but if four vouchers are available, 
        then the price could fall below $100 million (Ridley 
        and Regnier 2006). If voucher prices fall below $100 
        million, then the expected net present value of the 
        voucher would fall below the typical cost of a Phase 
        III clinical trial and FDA submission. Hence, the 
        voucher would not provide sufficient incentive for drug 
        development and additional incentives would be needed . 
        . .\16\
---------------------------------------------------------------------------
    \16\Letter from Dr. David Ridley, Ph.D, Faculty Director, Health 
Sector Management, Duke University Fuqua School of Business, to Rep. 
Frank Pallone, Jr. and Rep. Gene Green, House Committee on Energy and 
Commerce (May 17, 2016).

    Devaluation of a PRV can reduce the program's effectiveness 
by undermining incentives to develop new medicines for tropical 
or rare pediatric diseases.\17\
---------------------------------------------------------------------------
    \17\David B. Ridley and Stephane A. Regnier, The Commercial Market 
For Priority Review Vouchers, Health Affairs (May 1, 2016) 
(content.healthaffairs.org/content/35/5/776.full).
---------------------------------------------------------------------------

 6. The Unjustified and Unnecessary MCM PRV Program Would Be Permanent

    In other important areas, such as incentivizing development 
of drugs to help children, Congress thought it important to 
include a sunset date to allow for an opportunity to assess a 
program's impacts and determine if reauthorization is in the 
best interest of the American public. For example, the rare 
pediatric disease PRV program, the Best Pharmaceuticals for 
Children Act (BPCA), and the Pediatric Research Equity Act 
(PREA) included initial sunset dates so that we, as members of 
Congress, could determine if the legislation we enacted was 
working as intended. Both BPCA and PREA were later enacted on a 
permanent basis; however, this was only after Congress had the 
opportunity to assess if the program's benefits outweighed its 
costs.\18\
---------------------------------------------------------------------------
    \18\BPCA was enacted in 1997, and PREA was enacted in 2003. Both 
programs were made permanent as a part of the Food and Drug 
Administration Safety and Innovation Act in 2012.
---------------------------------------------------------------------------
    There is no sunset in the MCM PRV program that would give 
Congress a similar opportunity to determine if the program is 
effective or working as intended. It is important to note that 
there has been only one study of existing priority review 
programs, which focused narrowly on one PRV program. In this 
study, the Government Accountability Office found a lack of 
evidence demonstrating that the rare pediatric disease program 
was incentivizing new investment in drug research and 
development. As there is no existing evidence--other than 
anecdotes from those that stand to gain from PRV programs--
demonstrating that such programs are having the effect that 
Congress intended, it is unwise to create a new and permanent 
program for MCMs.

                                   Frank Pallone, Jr.,
                                           Ranking Member.
                                   Gene Green,
                                           Ranking Member, Subcommittee 
                                               on Health.