[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 935 Introduced in Senate (IS)]
<DOC>
118th CONGRESS
1st Session
S. 935
To require reporting regarding certain drug price increases, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 22, 2023
Ms. Baldwin (for herself, Mr. Braun, and Ms. Smith) introduced the
following bill; which was read twice and referred to the Committee on
Health, Education, Labor, and Pensions
_______________________________________________________________________
A BILL
To require reporting regarding certain drug price increases, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Fair Accountability and Innovative
Research Drug Pricing Act of 2023''.
SEC. 2. REPORTING ON JUSTIFICATION FOR DRUG PRICE INCREASES.
Title III of the Public Health Service Act (42 U.S.C. 241 et seq.)
is amended by adding at the end the following:
``PART W--DRUG PRICE REPORTING; DRUG VALUE FUND
``SEC. 399OO. REPORTING ON JUSTIFICATION FOR DRUG PRICE INCREASES.
``(a) Definitions.--In this section:
``(1) Manufacturer.--The term `manufacturer' means the
person--
``(A) that holds the application for a drug
approved under section 505 of the Federal Food, Drug,
and Cosmetic Act or the license issued under section
351 of this Act; or
``(B) who is responsible for setting the price for
the drug.
``(2) Qualifying drug.--The term `qualifying drug' means
any drug that is approved under subsection (c) or (j) of
section 505 of the Federal Food, Drug, and Cosmetic Act or
licensed under subsection (a) or (k) of section 351 of this
Act--
``(A) that has a wholesale acquisition cost of $100
or more per month supply, or per a course of treatment
that lasts less than a month, and is--
``(i)(I) subject to section 503(b)(1) of
the Federal Food, Drug, and Cosmetic Act; or
``(II) commonly administered by hospitals
(as determined by the Secretary); and
``(ii) not designated by the Secretary as a
vaccine; and
``(B) for which, during the previous calendar year,
at least 1 dollar of the total amount of sales were for
individuals enrolled under the Medicare program under
title XVIII of the Social Security Act (42 U.S.C. 1395
et seq.) or under a State Medicaid plan under title XIX
of such Act (42 U.S.C. 1396 et seq.) or under a waiver
of such plan.
``(3) United states median household income.--The term
`United States median household income' means median household
income for the United States as published by the Census Bureau
for the most recent year for which data is available.
``(4) Wholesale acquisition cost.--The term `wholesale
acquisition cost' has the meaning given that term in section
1847A(c)(6)(B) of the Social Security Act (42 U.S.C. 1395w-
3a(c)(6)(B)).
``(b) Report.--
``(1) Report required.--The manufacturer of a qualifying
drug shall submit a report to the Secretary if, with respect to
the qualifying drug--
``(A) there is an increase in the price of the
qualifying drug that results in an increase in the
wholesale acquisition cost of that drug that is equal
to--
``(i) 10 percent or more over a 12-month
period beginning on or after January 1, 2024;
or
``(ii) 25 percent or more over a 36-month
period beginning on or after January 1, 2024;
or
``(B) the wholesale acquisition price of the
qualifying drug for the applicable year or per normal
course of treatment that lasts less than 1 year, as
determined by the Secretary, exceeds United States
median household income beginning on or after January
1, 2024.
``(2) Report deadline.--Each report described in paragraph
(1) shall be submitted to the Secretary not later than 30 days
prior to the planned effective date of such price increase.
``(c) Contents.--A report under subsection (b) shall, at a minimum,
include--
``(1) with respect to the qualifying drug--
``(A) the percentage by which the manufacturer will
raise the wholesale acquisition cost of the drug on the
planned effective date of such price increase, as
applicable;
``(B) a justification for, and description of, each
manufacturer's price increase that will occur during
the 12-month period described in subsection (b)(1)(A)
or the 36-month period described in subsection
(b)(1)(B), as applicable;
``(C) an explanation for, and description of, the
cost associated with a qualifying drug if such drug
meets the criteria under subsection (b)(1)(B), as
applicable;
``(D) the identity of the initial developer of the
drug;
``(E) a description of the history of the
manufacturer's price increases for the drug since the
approval of the application for the drug under section
505 of the Federal Food, Drug, and Cosmetic Act or the
issuance of the license for the drug under section 351,
or since the manufacturer acquired such approved
application or license, as applicable;
``(F) the current list price of the drug;
``(G) the total expenditures of the manufacturer
on--
``(i) materials and manufacturing for such
drug; and
``(ii) acquiring patents and licensing for
such drug;
``(H) the percentage of total expenditures of the
manufacturer on research and development for such drug
that was derived from Federal funds;
``(I) the total expenditures of the manufacturer on
research and development for such drug that is used
for--
``(i) basic and preclinical research;
``(ii) clinical research;
``(iii) new drug development;
``(iv) pursuing new or expanded indications
for such drug through supplemental applications
under section 505 of the Federal Food, Drug,
and Cosmetic Act or section 351 of this Act;
and
``(v) carrying out postmarket requirements
related to such drug, including those under
section 505(o)(3) of the Federal Food, Drug,
and Cosmetic Act;
``(J) the total revenue and the net profit
generated from the qualifying drug for each calendar
year since the approval of the application for the drug
under section 505 of the Federal Food, Drug, and
Cosmetic Act or the issuance of the license for the
drug under section 351, or since the manufacturer
acquired such approved application or license; and
``(K) the total costs associated with marketing and
advertising for the qualifying drug;
``(2) with respect to the manufacturer--
``(A) the total revenue and the net profit of the
manufacturer for each of the 12-month periods described
in subsection (b)(1)(A) or for the 36-month period
described in subsection (b)(1)(B), as applicable;
``(B) all stock-based performance metrics used by
the manufacturer to determine executive compensation
for each of the 12-month periods described in
subsection (b)(1)(A) or the 36-month periods described
in subsection (b)(1)(B)(ii), as applicable; and
``(C) any additional information the manufacturer
chooses to provide related to drug pricing decisions,
such as total expenditures on--
``(i) drug research and development; or
``(ii) clinical trials on drugs that failed
to receive approval by the Food and Drug
Administration; and
``(3) such other related information as the Secretary
considers appropriate.
``(d) Civil Penalty.--Any manufacturer of a qualifying drug that
fails to submit a report for the drug as required by this section shall
be subject to a civil penalty of $100,000 for each day on which the
violation continues.
``(e) Public Posting.--
``(1) In general.--Subject to paragraph (3), not later than
30 days after the submission of a report under subsection (b),
the Secretary shall post the report on the public website of
the Department of Health and Human Services.
``(2) Format.--In developing the format of such report for
public posting, the Secretary shall consult stakeholders,
including beneficiary groups, and shall seek feedback on the
content and format from consumer advocates and readability
experts to ensure such public reports are user-friendly to the
public and are written in plain language that consumers can
readily understand.
``(3) Trade secrets and confidential information.--In
carrying out this section the Secretary shall enforce current
law concerning the protection of confidential commercial
information and trade secrets.''.
``SEC. 399OO-1. USE OF CIVIL PENALTY AMOUNTS.
``The Secretary shall, without further appropriation, collect civil
penalties under section 399OO and use the funds derived from such civil
penalties, in addition to any other amounts available to the Secretary,
to carry out activities described in this part and to improve consumer
and provider information about drug value and drug price transparency.
``SEC. 399OO-2. ANNUAL REPORT TO CONGRESS.
``(a) In General.--Subject to subsection (b), the Secretary shall
submit to Congress, and post on the public website of the Department of
Health and Human Services in a way that is easy to find, use, and
understand, an annual report--
``(1) summarizing the information reported pursuant to
section 399OO; and
``(2) including copies of the reports and supporting
detailed economic analyses submitted pursuant to such section.
``(b) Trade Secrets and Confidential Information.--In carrying out
this section the Secretary shall enforce current law concerning the
protection of confidential commercial information and trade secrets.''.
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