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U.S. Department of Health and Human Services

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Prescription Drug User Fee Amendments of 2002

 
Subtitle <<NOTE: Prescription Drug User Fee Amendments of 2002.>>
Prescription Drug User Fees
 
SEC. 501. <<NOTE: 21 USC 301 note.>>  SHORT TITLE.
 
    This subtitle may be cited as the ``Prescription Drug User Fee
Amendments of 2002''.
 
SEC. 502. <<NOTE: 21 USC 379g note.>>  FINDINGS.
 
    The Congress finds that--
            (1) prompt approval of safe and effective new drugs and
        other therapies is critical to the improvement of the public
        health so that patients may enjoy the benefits provided by these
        therapies to treat and prevent illness and disease;
            (2) the public health will be served by making additional
        funds available for the purpose of augmenting the resources of
        the Food and Drug Administration that are devoted to the process
        for the review of human drug applications and the assurance of
        drug safety;
            (3) the provisions added by the Prescription Drug User Fee
        Act of 1992, as amended by the Food and Drug Administration
        Modernization Act of 1997, have been successful in
        substantially reducing review times for human drug applications
        and should be--
                    (A) reauthorized for an additional 5 years, with
                certain technical improvements; and
                    (B) carried out by the Food and Drug Administration
                with new commitments to implement more ambitious and
                comprehensive improvements in regulatory processes of
                the Food and Drug Administration, including--
                          (i) strengthening and improving the review and
                      monitoring of drug safety;
                          (ii) considering greater interaction between
                      the agency and sponsors during the review of drugs
                      and biologics intended to treat serious diseases
                      and life-threatening diseases; and
                          (iii) developing principles for improving
                      first-cycle reviews; and
            (4) the fees authorized by amendments made in this subtitle
        will be dedicated towards expediting the drug development
        process and the process for the review of human drug
        applications as set forth in the goals identified for purposes
        of part 2 of subchapter C of chapter VII of the Federal Food,
        Drug, and Cosmetic Act, in the letters from the Secretary of
        Health and Human Services to the chairman of the Committee on
        Energy and Commerce of the House of Representatives and the
        chairman of the Committee on Health, Education, Labor and
        Pensions of the Senate, as set forth in the Congressional
        Record.
 
SEC. 503. DEFINITIONS.
 
    Section 735 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
379g) is amended--
            (1) in paragraph (1), in the matter after and below
        subparagraph (C), by striking ``licensure, as described in
        subparagraph (D)'' and inserting ``licensure, as described in
        subparagraph (C)'';
            (2) in paragraph (3)--
                    (A) in subparagraph (A), by striking ``and'' at the
                end;
                    (B) in subparagraph (B), by striking the period and
                inserting ``, and'';
                    (C) by inserting after subparagraph (B) the
                following subparagraph:
                    ``(C) which is on the list of products described in
                section 505(j)(7)(A) or is on a list created and
                maintained by the Secretary of products approved under
                human drug applications under section 351 of the Public
                Health Service Act.''; and
                    (D) in the matter after and below subparagraph (C)
                (as added by subparagraph (C) of this paragraph), by
                striking ``Service Act,'' and all that follows through
                ``biological product'' and inserting the following:
                ``Service Act. Such term does not include a biological
                product'';
            (3) in paragraph (6), by adding at the end the following
        subparagraph:
                    ``(F) In the case of drugs approved after October 1,
                2002, under human drug applications or supplements:
                collecting, developing, and reviewing safety information
                on the drugs, including adverse event reports, during a
                period
 
[[Page 116 STAT. 689]]
 
                of time after approval of such applications or
                supplements, not to exceed three years.''; and
            (4) in paragraph (8)--
                    (A) by striking the matter after and below
                subparagraph (B);
                    (B) by striking subparagraph (B);
                    (C) by striking ``is the lower of'' and all that
                follows through ``Consumer Price Index'' and inserting
                ``is the Consumer Price Index''; and
                    (D) by striking ``1997, or'' and inserting
                ``1997.''.
 
SEC. 504. AUTHORITY TO ASSESS AND USE DRUG FEES.
 
    (a) Types of Fees.--Section 736(a) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 379h(a)) is amended--
            (1) in the matter preceding paragraph (1), by striking
        ``fiscal year 1998'' and inserting ``fiscal year 2003'';
            (2) in paragraph (1)(A)--
                    (A) in each of clauses (i) and (ii), by striking
                ``in subsection (b)'' and inserting ``under subsection
                (c)(4)''; and
                    (B) in clause (ii), by adding at the end the
                following sentence: ``Such fee shall be half of the
                amount of the fee established under clause (i).'';
            (3) in paragraph (2)(A), in the matter after and below
        clause (ii)--
                    (A) by striking ``in subsection (b)'' and inserting
                ``under subsection (c)(4)''; and
                    (B) by striking ``payable on or before January 31''
                and inserting ``payable on or before October 1''; and
            (4) in paragraph (3)--
                    (A) by amending subparagraph (A) to read as follows:
                    ``(A) In general.--Except as provided in
                subparagraph (B), each person who is named as the
                applicant in a human drug application, and who, after
                September 1, 1992, had pending before the Secretary a
                human drug application or supplement, shall pay for each
                such prescription drug product the annual fee
                established under subsection (c)(4). Such fee shall be
                payable on or before October 1 of each year. Such fee
                shall be paid only once for each product for a fiscal
                year in which the fee is payable.''; and
                    (B) in subparagraph (B), by striking ``The listing''
                and all that follows through ``filed under section
                505(b)(2)'' and inserting the following: ``A
                prescription drug product shall not be assessed a fee
                under subparagraph (A) if such product is identified on
                the list compiled under section 505(j)(7)(A) with a
                potency described in terms of per 100 mL, or if such
                product is the same product as another product approved
                under an application filed under section 505(b)''.
 
    (b) Fee Amounts.--Section 736(b) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 379h(b)) is amended to read as follows:
    ``(b) Fee Revenue Amounts.--Except as provided in subsections (c),
(d), (f), and (g), fees under subsection (a) shall be established to
generate the following revenue amounts:
 
 
  Fiscal year
Type of Fee Revenue 2004 2004 2005 2006 2007
Application/Supplement $74,300,000 $77,000,000 $84,000,000 $86,434,000 $86,434,000
Establishment $74,300,000 $77,000,000 $84,000,000 $86,433,000 $86,433,000
Product $74,300,000 $77,000,000 $84,000,000 $86,433,000 $86,433,000
Total Fee Revenue $222,900,000 $231,000,000 $252,000,000 $259,300,000 $259,300,00
  
If, after the date of the enactment of the Prescription Drug User Fee
Amendments of 2002, legislation is enacted requiring the Secretary to
fund additional costs of the retirement of Federal personnel, fee
revenue amounts shall be increased in each year by the amount necessary
to fully fund the portion of such additional costs that are attributable
to the process for the review of human drug applications.''.
    (c) Adjustments.--Section 736(c) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 379h(c)) is amended--
            (1) in paragraph (1)--
                    (A) in the matter preceding subparagraph (A), by
                striking ``fees and total fee revenues'' and inserting
                ``revenues'';
                    (B) in subparagraph (A)--
                          (i) by striking ``during the preceding fiscal
                      year''; and
                          (ii) by striking ``, or'' and inserting the
                      following: ``for the 12 month period ending June
                      30 preceding the fiscal year for which fees are
                      being established, or'';
                    (C) in subparagraph (B), by striking ``for such
                fiscal year'' and inserting ``for the previous fiscal
                year''; and
                    (D) in the matter after and below subparagraph (B),
                by striking ``fiscal year 1997''; and inserting ``fiscal
                year 2003'';
            (2) by redesignating paragraphs (2) and (3) as paragraphs
        (4) and (5), respectively;
            (3) by inserting after paragraph (1) the following
        paragraphs:
            ``(2) <<NOTE: Effective date.>>  Workload adjustment.--
        Beginning with fiscal year 2004, after the fee revenues
        established in subsection (b) are adjusted for a fiscal year for
        inflation in accordance with paragraph (1), the fee revenues
        shall be adjusted further for such fiscal year to reflect
        changes in the workload of the Secretary for the process for the
        review of human drug applications. With respect to such
        adjustment:
                    ``(A) The adjustment shall be determined by the
                Secretary based on a weighted average of the change in
                the total number of human drug applications, commercial
                investigational new drug applications, efficacy
                supplements, and manufacturing supplements submitted to
                the Secretary. <<NOTE: Federal Register, publication.>> 
                The Secretary shall publish in the Federal Register the
                fee revenues and fees resulting from the adjustment and
                the supporting methodologies.
                    ``(B) Under no circumstances shall the adjustment
                result in fee revenues for a fiscal year that are less
                than the fee revenues for the fiscal year established in
                subsection (b), as adjusted for inflation under
                paragraph (1).
 
            ``(3) Final year adjustment.--For fiscal year 2007, the
        Secretary may, in addition to adjustments under paragraphs (1)
        and (2), further increase the fee revenues and fees established
        in subsection (b) if such an adjustment is necessary to provide
        for not more than three months of operating reserves of
        carryover user fees for the process for the review of human drug
        applications for the first three months of fiscal year 2008. If
        such an adjustment is necessary, the rationale for the amount of
        the increase shall be contained in the annual notice
        establishing fee revenues and fees for fiscal year 2007. If the
        Secretary has carryover balances for such process in excess of
        three months of such operating reserves, the adjustment under
        this paragraph shall not be made.''; and
            (4) in paragraph (4) (as redesignated by paragraph (2) of
        this subsection), by amending such paragraph to read as follows:
            ``(4) <<NOTE: Effective date.>>  Annual fee setting.--The
        Secretary shall, 60 days before the start of each fiscal year
        that begins after September 30, 2002, establish, for the next
        fiscal year, application, product, and establishment fees under
        subsection (a), based on the revenue amounts established under
        subsection (b) and the adjustments provided under this
        subsection.''.
 
    (d) Fee Waiver or Reduction.--Section 736(d)) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 379h(d)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (C), by inserting ``or'' after
                the comma at the end;
                    (B) by striking subparagraph (D); and
                    (C) by redesignating subparagraph (E) as
                subparagraph (D); and
            (2) in paragraph (3), in each of subparagraphs (A) and (B),
        by striking ``paragraph (1)(E)'' each place such term appears
        and inserting ``paragraph (1)(D)''.
 
    (e) Assessment of Fees.--Section 736(f) of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 379h(f)) is amended--
            (1) in the heading for the subsection, by striking
        ``Assessment of Fees.--'' and inserting ``Limitations.--''; and
            (2) in paragraph (1), by striking the heading for the
        paragraph and all that follows through ``fiscal year beginning''
        and inserting the following: ``In general.--Fees under
        subsection (a) shall be refunded for a fiscal year beginning''.
 
    (f) Crediting and Availability of Fees.--
            (1) In general.--Section 736(g)(1) of the Federal Food,
        Drug, and Cosmetic Act (21 U.S.C. 379h(g)(1)) is amended by
        striking ``Fees collected for a fiscal year'' and all that
        follows through ``fiscal year limitation.'' and inserting the
        following: ``Fees authorized under subsection (a) shall be
        collected and available for obligation only to the extent and in
        the amount provided in advance in appropriations Acts. Such fees
        are authorized to remain available until expended.''.
            (2) Collections and appropriation acts.--Section 736(g)(2)
        of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
        379h(g)(2)) is amended--
                    (A) by redesignating subparagraphs (A) and (B) as
                clauses (i) and (ii), respectively;
                    (B) by striking ``(2) Collections'' and all that
                follows through ``the amount specified'' in clause (i)
                (as so redesignated) and inserting the following:
            ``(2) Collections and appropriation acts.--
                    ``(A) In general.--The fees authorized by this
                section--
                          ``(i) shall be retained in each fiscal year in
                      an amount not to exceed the amount specified'';
                    (C) by moving clause (ii) (as so redesignated) two
                ems to the right; and
                    (D) by adding at the end the following subparagraph:
                    ``(B) Compliance.--The Secretary shall be considered
                to have met the requirements of subparagraph (A)(ii) in
                any fiscal year if the costs funded by appropriations
                and allocated for the process for the review of human
                drug applications--
                          ``(i) are not more than 3 percent below the
                      level specified in subparagraph (A)(ii); or
                          ``(ii)(I) are more than 3 percent below the
                      level specified in subparagraph (A)(ii), and fees
                      assessed for the fiscal year following the
                      subsequent fiscal year are decreased by the amount
                      in excess of 3 percent by which such costs fell
                      below the level specified in such subparagraph;
                      and
                          ``(II) such costs are not more than 5 percent
                      below the level specified in such subparagraph.''.
            (3) Authorization of appropriations.--Section 736(g)(3) of
        the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 379h(g)(3))
        is amended by striking subparagraphs (A) through (E) and
        inserting the following:
                    ``(A) $222,900,000 for fiscal year 2003;
                    ``(B) $231,000,000 for fiscal year 2004;
                    ``(C) $252,000,000 for fiscal year 2005;
                    ``(D) $259,300,000 for fiscal year 2006; and
                    ``(E) $259,300,000 for fiscal year 2007;''.
 
SEC. 505. <<NOTE: Effective dates. Deadlines. 21 USC 379g note.>> 
            ACCOUNTABILITY AND REPORTS.
 
    (a) Public Accountability.--
            (1) Consultation.--In developing recommendations to the
        Congress for the goals and plans for meeting the goals for the
        process for the review of human drug applications for the fiscal
        years after fiscal year 2007, and for the reauthorization of
        sections 735 and 736 of the Federal Food, Drug, and Cosmetic
        Act, the Secretary of Health and Human Services (referred to in
        this section as the ``Secretary'') shall consult with the
        Committee on Energy and Commerce of the House of
        Representatives, the Committee on Health, Education, Labor, and
        Pensions of the Senate, appropriate scientific and academic
        experts, health care professionals, representatives of patient
        and consumer advocacy groups, and the regulated industry.
            (2) <<NOTE: Federal Register, publication.>> 
        Recommendations.--The Secretary shall publish in the Federal
        Register recommendations under paragraph (1), after negotiations
        with the regulated industry; shall present such recommendations
        to the congressional committees specified in such paragraph;
        shall hold a meeting at which the public may present its views
        on such recommendations; and shall provide
        for a period of 30 days for the public to provide written
        comments on such recommendations.
 
    (b) Performance Report.--Beginning with fiscal year 2003, not later
than 60 days after the end of each fiscal year during which fees are
collected under part 2 of subchapter C of chapter VII of the Federal
Food, Drug, and Cosmetic Act (21 U.S.C. 379g et seq.), the Secretary of
Health and Human Services shall prepare and submit to the President, the
Committee on Energy and Commerce of the House of Representatives, and
the Committee on Health, Education, Labor, and Pensions of the Senate a
report concerning the progress of the Food and Drug Administration in
achieving the goals identified in the letters described in section
502(4) during such fiscal year and the future plans of the Food and Drug
Administration for meeting the goals.
    (c) Fiscal Report.--Beginning with fiscal year 2003, not later than
120 days after the end of each fiscal year during which fees are
collected under the part described in subsection (b), the Secretary of
Health and Human Services shall prepare and submit to the Committee on
Energy and Commerce of the House of Representatives, and the Committee
on Health, Education, Labor, and Pensions of the Senate, a report on the
implementation of the authority for such fees during such fiscal year
and the use, by the Food and Drug Administration, of the fees collected
during such fiscal year for which the report is made.
 
SEC. 506. REPORTS OF POSTMARKETING STUDIES.
 
    Section 506B of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
356b) is amended by adding at the end the following subsections:
    ``(d) Disclosure.--If a sponsor fails to complete an agreed upon
study required by this section by its original or otherwise negotiated
deadline, the Secretary shall publish a statement on the Internet site
of the Food and Drug Administration stating that the study was not
completed and, if the reasons for such failure to complete the study
were not satisfactory to the Secretary, a statement that such reasons
were not satisfactory to the Secretary.
    ``(e) Notification.--With respect to studies of the type required
under section 506(b)(2)(A) or under section 314.510 or 601.41 of title
21, Code of Federal Regulations, as each of such sections was in effect
on the day before the effective date of this subsection, the Secretary
may require that a sponsor who, for reasons not satisfactory to the
Secretary, fails to complete by its deadline a study under any of such
sections of such type for a drug or biological product (including such a
study conducted after such effective date) notify practitioners who
prescribe such drug or biological product of the failure to complete
such study and the questions of clinical benefit, and, where
appropriate, questions of safety, that remain unanswered as a result of
the failure to complete such study. Nothing in this subsection shall be
construed as altering the requirements of the types of studies required
under section 506(b)(2)(A) or under section 314.510 or 601.41 of title
21, Code of Federal Regulations, as so in effect, or as prohibiting the
Secretary from modifying such sections of title 21 of such Code to
provide for studies in addition to those of such type.''.
 
SEC. 507. <<NOTE: 21 USC 379g note.>>  SAVINGS CLAUSE.
 
    Notwithstanding section 107 of the Food and Drug Administration
Modernization Act of 1997, and notwithstanding the amendments made by
this subtitle, part 2 of subchapter C of chapter VII of the Federal
Food, Drug, and Cosmetic Act, as in effect on the day before the date of
the enactment of this Act, continues to be in effect with respect to
human drug applications and supplements (as defined in such part as of
such day) that, on or after October 1, 1997, but before October 1, 2002,
were accepted by the Food and Drug Administration for filing and with
respect to assessing and collecting any fee required by such Act for a
fiscal year prior to fiscal year 2003.
 
SEC. 508. <<NOTE: 21 USC 356b note.>>  EFFECTIVE DATE.
 
    The amendments made by this subtitle shall take effect October 1,
2002.
 
SEC. 509. <<NOTE: 21 USC 379g note.>>  SUNSET CLAUSE.
 
    The amendments made by sections 503 and 504 cease to be effective
October 1, 2007, and section 505 ceases to be effective 120 days after
such date.