I 

112TH CONGRESS 

1ST SESSION H. R. 3497 

To promote the development of meaningful treatments for patients. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 18, 2011 

Mr. LANCE introduced the following bill; which was referred to the Committee 

on Energy and Commerce, and in addition to the Committees on Ways 

and Means and the Judiciary, for a period to be subsequently determined 

by the Speaker, in each case for consideration of such provisions as fall 

within the jurisdiction of the committee concerned 

A BILL 

To promote the development of meaningful treatments for 

patients. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Modernizing Our Drug 

5 & Diagnostics Evaluation and Regulatory Network Cures 

6 Act of 2011’’ or the ‘‘MODDERN Cures Act of 2011’’. 

7 SEC. 2. TABLE OF CONTENTS. 

8 The table of contents for this Act is as follows: 

Sec. 1. Short title. 

Sec. 2. Table of contents. 

Sec. 3. Findings. 


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Sec. 4. Definitions. 

TITLE I—ADVANCING DIAGNOSTICS FOR PATIENTS 

Sec. 101. Developing a common lexicon to facilitate progress on diagnostics. 

Sec. 102. Creating incentives for innovative diagnostics. 

Sec. 103. Promoting the development of innovative diagnostics. 

TITLE II—CAPTURING LOST OPPORTUNITIES FOR PATIENTS 

Sec. 201. Designation of dormant therapies. 

Sec. 202. Promoting the development of dormant therapies. 

1 SEC. 3. FINDINGS. 

2 The Congress makes the following findings: 

3 (1) More than 133 million Americans, or 45 

4 percent of the population, have at least one chronic 

5 condition. A quarter of Americans have multiple 

6 chronic conditions. 

7 (2) Chronic diseases have become the leading 

8 cause of death and disability in the United States. 

9 Seven out of every 10 deaths are attributable to 

10 chronic disease. Chronic diseases also compromise 

11 the quality of life of millions of Americans. 

12 (3) Despite $80,000,000,000 spent annually on 

13 research and development, many diseases and condi14 tions lack effective treatments. 

15 (4) Many commonly used drugs are effective in 

16 only 50 to 75 percent of the patient population, 

17 which can lead to devastating long-term side effects, 

18 resulting in the potential risks outweighing the bene19 fits for some patients. 


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1 (5) Advanced and innovative diagnostic tests 

2 have the potential to dramatically increase the effi3 cacy and safety of drugs by better predicting how 

4 patients will respond to a given therapy. 

5 (6) Despite their promise, many drugs and 

6 diagnostics may go undeveloped due to uncertain 

7 regulatory and reimbursement processes, among 

8 other reasons. 

9 (7) In addition, there is reason to believe that 

10 potential treatments with tremendous value to pa11 tients are never developed or are discontinued during 

12 research and development due to insufficiencies in 

13 the intellectual property system. 

14 (8) It is in the public interest to address the 

15 hurdles that may be precluding new treatments from 

16 reaching patients and to remove the disincentives for 

17 the development of therapies for these unmet needs. 

18 SEC. 4. DEFINITIONS. 

19 In this Act: 

20 (1) The term ‘‘biological product’’ has the 

21 meaning given to that term in section 351 of the 

22 Public Health Service Act (42 U.S.C. 262). 

23 (2) The term ‘‘drug’’ has the meaning given to 

24 that term in section 201 of the Federal Food, Drug, 

25 and Cosmetic Act (21 U.S.C. 321). 


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1 (3) The term ‘‘Secretary’’ means the Secretary 

2 of Health and Human Services. 

3 TITLE I—ADVANCING 

4 DIAGNOSTICS FOR PATIENTS 

5 SEC. 101. DEVELOPING A COMMON LEXICON TO FACILI6 TATE PROGRESS ON DIAGNOSTICS. 

7 (a) IN GENERAL.—Not later than 180 days after the 

8 date of enactment of this Act, the Secretary shall establish 

9 within the Department of Health and Human Services the 

10 Advanced Diagnostics Education Council (in this section 

11 referred to as the ‘‘Council’’). 

12 (b) DUTIES.— 

13 (1) IN GENERAL.—The Council shall promote 

14 an improved understanding of key concepts related 

15 to innovative diagnostics by recommending standard 

16 terms and definitions for use by patients, physicians, 

17 health care providers, payers, and policymakers. 

18 (2) GUIDE.—The Secretary shall publish and 

19 disseminate a guide regarding such recommended 

20 terms and definitions for patients, physicians, health 

21 care providers, payers, and policymakers. 

22 (3) REPORT.—Not later than 12 months after 

23 the establishment of the Council, the Secretary shall 

24 prepare and submit a report to the Congress and to 

25 the public on the Council’s deliberations, activities, 


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1 and determinations with respect to meeting its du2 ties described in paragraphs (1) and (2). 

3 (c) CHAIRPERSON.—The Secretary, or the Sec4 retary’s designee, shall serve as chairperson of the Coun5 cil. 

6 (d) MEMBERS.—In addition to the Secretary, the 

7 Council shall consist of the following: 

8 (1) The head of each the following agencies (or 

9 a designee thereof): 

10 (A) The National Institutes of Health. 

11 (B) The Centers for Disease Control and 

12 Prevention. 

13 (C) The Food and Drug Administration. 

14 (D) The Agency for Healthcare Research 

15 and Quality. 

16 (E) The Centers for Medicare & Medicaid 

17 Services. 

18 (F) The Department of Defense. 

19 (G) The Department of Veterans Affairs. 

20 (H) The Health Resources and Services 

21 Administration. 

22 (I) The Substance Abuse and Mental 

23 Health Services Administration. 

24 (J) The Indian Health Service. 


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1 (2) Seven members appointed by the Secretary 

2 from among individuals who collectively— 

3 (A) represent a broad range of perspec4 tives; and 

5 (B) have expertise in— 

6 (i) basic and translational research, 

7 including with respect to molecular biology 

8 and genetics; 

9 (ii) bioinformatics; 

10 (iii) the discovery, development, and 

11 commercialization of in vitro diagnostics; 

12 and 

13 (iv) law and ethics. 

14 (3) Four members appointed by the Secretary 

15 who are each a chief medical or scientific officer of 

16 a patient advocacy organization. 

17 (e) PUBLIC INPUT.—In carrying out its duties, the 

18 Council shall solicit input from relevant stakeholders and 

19 the public. 

20 (f) TERMINATION.—The Council shall terminate 

21 after publishing the guide required by subsection (b)(2) 

22 and submitting the report required by subsection (b)(3), 

23 or later at the discretion of the Secretary. 


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1 SEC. 102. CREATING INCENTIVES FOR INNOVATIVE 

2 DIAGNOSTICS. 

3 (a) IMPROVEMENTS TO PROCESS FOR DETERMINING

4 FEE SCHEDULE AMOUNTS FOR NEW TESTS.— 

5 (1) CLARIFYING FACTORS FOR RATE-SET6 TING.— 

7 (A) IN GENERAL.—In determining the pay8 ment amount under gapfilling procedures (as 

9 described in section 414.508(b) of title 42, 

10 Code of Federal Regulations, or any successor 

11 regulation to such section) for new clinical diag12 nostic laboratory tests under section 1833(h)(8) 

13 of the Social Security Act (42 U.S.C. 

14 1395l(h)(8)), the Secretary of Health and 

15 Human Services (in this section referred to as 

16 the ‘‘Secretary’’) shall take into account, as ap17 plicable and available, the following factors with 

18 respect to such a new test: 

19 (i) IMPACT ON PATIENT CARE.—The 

20 impact of the new test on patient care, pa21 tient management, or patient treatment. 

22 (ii) TECHNICAL CHARACTERISTICS.— 

23 The technical characteristics of the new 

24 test, and the resources required to develop, 

25 validate, and perform the new test. 


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1 (iii) CLAIMS DATA.—Data from claims 

2 for which payment is made under part B 

3 of title XVIII of the Social Security Act. 

4 (iv) LABORATORY CHARGES.— 

5 Amounts charged by laboratories to self6 pay patients for the new test. 

7 (v) PRIVATE INSURANCE RATES.— 

8 Amounts paid to laboratories for such new 

9 test under private health insurance cov10 erage offered in the group market and the 

11 individual market. 

12 (vi) ADVISORY PANEL RECOMMENDA13 TIONS.—The findings and recommenda14 tions of the independent advisory panel 

15 convened under paragraph (2) with respect 

16 to that new test and any comments re17 ceived during the open meeting of the advi18 sory panel. 

19 (vii) ADDITIONAL FACTORS.—Such 

20 other factors as the Secretary may specify. 

21 (2) INPUT FROM PATIENTS, CLINICIANS, AND

22 TECHNICAL EXPERTS.— 

23 (A) REQUIREMENT FOR INDEPENDENT AD24 VISORY PANEL.—The Secretary shall convene 

25 an independent advisory panel from which the 


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1 Secretary shall request information and rec2 ommendations regarding any new test (as re3 ferred to under subparagraph (A) of section 

4 1833(h)(8) of the Social Security Act (42 

5 U.S.C. 1395l(h)(8))) for which payment is 

6 made under such section, including technical, 

7 clinical, and quality information. 

8 (B) COMPOSITION OF INDEPENDENT ADVI9 SORY PANEL.—The independent advisory panel 

10 shall be comprised of 19 members, including— 

11 (i) 4 individuals with expertise and ex12 perience with advanced clinical diagnostic 

13 laboratory tests, including expertise in the 

14 technical characteristics of the new test; 

15 (ii) 3 representatives of patients, in16 cluding a patient representative for rare 

17 disorders; 

18 (iii) 3 clinicians who use results of the 

19 new test in patient care; 

20 (iv) 3 individuals with expertise in the 

21 requirements to develop, validate, and per22 form the new test; 

23 (v) 2 laboratorians; 


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1 (vi) 2 experts in the area of 

2 pharmacoeconomics or health technology 

3 assessment; and 

4 (vii) 2 individuals with expertise on 

5 the impact of new tests on quality of pa6 tient care, including genetic counselors. 

7 (C) TERMS.—A member of the panel shall 

8 be appointed to serve a term of 6 years, except 

9 with respect to the members first appointed, 

10 whose terms of appointment shall be staggered 

11 evenly over 2-year increments. 

12 (D) EXPERT CONSULTANTS.—The Sec13 retary may include to serve temporarily on the 

14 panel individuals who have expertise pertaining 

15 to the new test involved. 

16 (E) OPEN MEETINGS.—The Secretary shall 

17 receive or review the findings and recommenda18 tions of the independent advisory panel with re19 spect to the new tests described in subpara20 graph (A) involved during a meeting open to 

21 the public and provide opportunity for public 

22 comment. 

23 (F) CLARIFICATION OF AUTHORITY OF

24 SECRETARY TO CONSULT CARRIERS.—Nothing 

25 in this section shall be construed as affecting 


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1 the authority of the Secretary to consult with 

2 appropriate Medicare administrative contrac3 tors. 

4 (b) PROCESS FOR ASSIGNMENT OF TEMPORARY

5 CODES FOR DIAGNOSTIC TESTS.—The Secretary shall es6 tablish a process for application for the assignment of a 

7 temporary national HCPCS code to uniquely identify a di8 agnostic test until a permanent national HCPCS code is 

9 available for assignment to that test. Assignments of a 

10 temporary national HCPCS code shall occur on a quar11 terly basis. The Secretary shall provide public notice 

12 through the Centers for Medicare & Medicaid Services 

13 website of applications made for such temporary national 

14 HCPCS codes. Upon assignment of a temporary code 

15 under this process, the Secretary shall treat such test as 

16 a new test for purposes of section 1833(h)(8) of the Social 

17 Security Act. 

18 (c) DEVELOPMENT OF FURTHER IMPROVEMENTS IN

19 RATE-SETTING PROCESSES.—The Secretary shall analyze 

20 the process used for the gapfilling procedure used in deter21 mining payment amounts for new clinical diagnostic lab22 oratory tests under section 1833(h)(8) of the Social Secu23 rity Act. Taking into account the changes made by this 

24 section, the Secretary shall identify further changes to im25 prove the accuracy and appropriateness of resulting rates 


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1 and the openness, transparency, and predictability of the 

2 process. The Secretary shall examine what and how many 

3 entities should perform gapfilling, under contract or other4 wise, and how to ensure that the process is informed by 

5 appropriate expertise and proceeds in a transparent and 

6 accountable manner. The Secretary shall implement im7 provements in the process, insofar as these are possible 

8 under the law through regulations, after public notice and 

9 opportunity for comment. For changes the Secretary de10 termines would require a change in law, the Secretary 

11 shall transmit recommendations to the Speaker of the 

12 House and the President of the Senate not later than July 

13 1, 2013. 

14 (d) DEFINITIONS.—For purposes of this section: 

15 (1) NEW CLINICAL DIAGNOSTIC LABORATORY

16 TESTS.—The term ‘‘new clinical diagnostic labora17 tory test’’ means a clinical diagnostic laboratory 

18 test— 

19 (A) that is assigned a new or substantially 

20 revised code on or after January 1, 2013; or 

21 (B) for which an application for a tem22 porary national HCPCS code is made under 

23 subsection (b) on or after January 1, 2013. 

24 (2) SELF-PAY PATIENT.—The term ‘‘self-pay 

25 patient’’ means, with respect to a health care item 


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1 or service, an individual who pays out of pocket for 

2 such item or service and who does not have health 

3 insurance coverage for such item or service. 

4 (e) EFFECTIVE DATE.—This section shall take effect 

5 on the date of enactment of this Act, and shall apply with 

6 respect to new clinical diagnostic laboratory tests. 

7 SEC. 103. PROMOTING THE DEVELOPMENT OF INNOVATIVE 

8 DIAGNOSTICS. 

9 (a) DETERMINATION.— 

10 (1) REQUEST.—The manufacturer or sponsor 

11 of a drug or biological product may request the Sec12 retary to determine that— 

13 (A) a diagnostic test has been developed 

14 by, or with the participation of, the manufac15 turer or sponsor of the drug or biological prod16 uct; and 

17 (B) use of the diagnostic test, as dem18 onstrated through valid scientific information 

19 such as peer-reviewed literature— 

20 (i) provides for or improves the identi21 fication of a patient population for which 

22 the drug or biological product will or will 

23 not be used in accordance with its ap24 proved indications; or 


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1 (ii) provides for or improves the deter2 mination of the most appropriate treat3 ment option for a patient population with 

4 the drug or biological product in accord5 ance with its approved indications. 

6 (2) RESPONSE BY SECRETARY.—Not later than 

7 30 days after the submission of a request under 

8 paragraph (1), the Secretary, shall— 

9 (A) make the requested determination and 

10 publish a notice of such determination and any 

11 extension under this section resulting from such 

12 determination; or 

13 (B) provide an explanation to the manufac14 turer or sponsor submitting the request of why 

15 the determination is not warranted. 

16 (b) APPLICABLE EXTENSION PERIOD.—For purposes 

17 of subsections (c) and (d), the applicable extension period 

18 is— 

19 (1) with respect to a diagnostic test developed 

20 (as described in subsection (a)(1)(A)) contempora21 neously with the development of the drug or biologi22 cal product involved, 12 months; and 

23 (2) with respect to a diagnostic test developed 

24 otherwise, 6 months. 


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1 (c) EXTENSION FOR DRUGS.—If, at the request of 

2 the manufacturer or sponsor of a drug, the Secretary 

3 makes the determination described in subsection (a)(1) 

4 with respect to such drug and a diagnostic test, then— 

5 (1) the four- and five-year periods described in 

6 subsections (c)(3)(E)(ii) and (j)(5)(F)(ii) of section 

7 505 of the Federal Food, Drug, and Cosmetic Act 

8 (21 U.S.C. 355), the three-year periods described in 

9 clauses (iii) and (iv) of subsection (c)(3)(E) and 

10 clauses (iii) and (iv) of subsection (j)(5)(F) of such 

11 section 505, or the seven-year period described in 

12 section 527 of the Federal Food, Drug, and Cos13 metic Act (21 U.S.C. 360cc), as applicable, shall be 

14 extended by the applicable extension period; 

15 (2) if the drug is the subject of— 

16 (A) a listed patent for which a certification 

17 has been submitted under subsection 

18 (b)(2)(A)(ii) or (j)(2)(A)(vii)(II) of such section 

19 505; or 

20 (B) a listed patent for which a certification 

21 has been submitted under subsection 

22 (b)(2)(A)(iii) or (j)(2)(A)(vii)(III) of such sec23 tion 505, 

24 then the period during which an application may not 

25 be approved under subsection (c)(3) or (j)(5)(B) of 


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1 such section 505 shall be extended by the applicable 

2 extension period after the date the patent expires 

3 (including any patent extensions); and 

4 (3) if the drug is the subject of a listed patent 

5 for which a certification has been submitted under 

6 subsection (b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) of such 

7 section 505, and in the patent infringement litiga8 tion resulting from the certification the court deter9 mines that the patent is valid and would be in10 fringed, the period during which an application may 

11 not be approved under subsection (c)(3) or (j)(5)(B) 

12 of such section 505 shall be extended by the applica13 ble extension period after the date the patent expires 

14 (including any patent extension). 

15 (d) EXTENSION FOR BIOLOGICAL PRODUCTS.—If, at 

16 the request of the manufacturer or sponsor of a biological 

17 product, the Secretary makes the determination described 

18 in subsection (a)(1) with respect to such biological product 

19 and a diagnostic test, then the 12-year period described 

20 in subsection (k)(7)(A) of section 351 of the Public Health 

21 Service Act (42 U.S.C. 262), the 4-year period described 

22 in subsection (k)(7)(B) of such section 351, and the 7- 

23 year period described in section 527 of the Federal Food, 

24 Drug, and Cosmetic Act (21 U.S.C. 360cc), as applicable, 

25 shall be extended by the applicable extension period. 


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1 (e) RELATION TO PEDIATRIC EXCLUSIVITY.—Any 

2 extension under subsection (c) or (d) of a period shall be 

3 in addition to any extension of the period under section 

4 505A of the Federal Food, Drug, and Cosmetic Act (21 

5 U.S.C. 355a) with respect to the drug or biological prod6 uct. 

7 (f) LIMITATIONS.—Extensions under this section 

8 may apply— 

9 (1) not more than twice with respect to the 

10 same drug or biological product; and 

11 (2) not more than once with respect to the 

12 same indication to be treated by the same drug or 

13 biological product. 

14 TITLE II—CAPTURING LOST 

15 OPPORTUNITIES FOR PATIENTS 

16 SEC. 201. DESIGNATION OF DORMANT THERAPIES. 

17 (a) DESIGNATION.—The Secretary shall designate a 

18 drug or biological product as a dormant therapy if— 

19 (1) the sponsor of the drug or biological prod20 uct submits a request in accordance with subsection 

21 (b); and 

22 (2) the Secretary determines that— 

23 (A) the indication for which the drug or bi24 ological product is being investigated or is inVerDate Mar 15 2010 22:14 Nov 21, 2011 Jkt 019200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\H3497.IH H3497

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1 tended to be investigated is to address one or 

2 more unmet medical needs; and 

3 (B) the sponsor intends to file an applica4 tion pursuant to section 505(b) of the Federal 

5 Food, Drug, and Cosmetic Act (21 U.S.C. 

6 355(b)) or section 351(a) of the Public Health 

7 Service Act (42 U.S.C. 262(a)) for approval or 

8 licensing of the drug or biological product for 

9 such indication. 

10 (b) REQUEST FOR DESIGNATION.— 

11 (1) SUBMISSION.—The sponsor of a drug or bi12 ological product may submit a request to the Sec13 retary to designate the drug or biological product as 

14 a dormant therapy. 

15 (2) CONTENTS.—Any request under paragraph 

16 (1) with respect to a drug or biological product shall 

17 contain each of the following: 

18 (A) A listing of all patents and applica19 tions for patents— 

20 (i) under which the sponsor has 

21 rights; and 

22 (ii) which may be reasonably con23 strued to provide protection for the drug or 

24 biological product. 


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1 (B) A waiver of enforcement rights in ac2 cordance with paragraph (3). 

3 (C) A certification by the sponsor that the 

4 new drug or new biological product has prospec5 tively insufficient patent protection. 

6 (3) WAIVER.— 

7 (A) REQUIREMENT.—A request under 

8 paragraph (1) shall contain a waiver of the 

9 right to enforce any patent or patent applica10 tion, which issues as a patent described in para11 graph (2)(A) with respect to any product de12 scribed in subparagraph (B). 

13 (B) PRODUCTS DESCRIBED.—A product is 

14 described in this subparagraph if— 

15 (i) it is approved or licensed pursuant 

16 to an application that is filed under section 

17 505(b)(2) or 505(j) of the Federal Food, 

18 Drug, and Cosmetic Act (21 U.S.C. 

19 355(b)(2), (j)) or section 351(k) of the 

20 Public Health Service Act (42 U.S.C. 

21 262(k)); and 

22 (ii) the filing occurs after the expira23 tion of the protection period (as defined in 

24 section 202(a)(1) of this Act) applicable to 


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1 the drug or biological product to which the 

2 request under paragraph (1) relates. 

3 (C) EFFECTIVE ONLY UPON DESIGNA4 TION.—A waiver under this paragraph shall be 

5 effective only upon the designation under this 

6 section of the drug or biological product to 

7 which it relates as a dormant therapy. 

8 (D) INABILITY TO WAIVE RIGHT TO EN9 FORCE ONE OR MORE PATENTS.—If a sponsor 

10 of a drug or biological product is unable to 

11 grant an effective waiver of the right to enforce 

12 one or more patents or applications for patent 

13 as described in subparagraph (A)— 

14 (i) the sponsor may not make a re15 quest under this subsection with respect to 

16 the drug or biological product; and 

17 (ii) if the sponsor has made such a re18 quest, the sponsor shall promptly withdraw 

19 the request. 

20 (4) TIMING.— 

21 (A) REQUEST.—Any request for designa22 tion of a drug or biological product as a dor23 mant therapy under subsection (a) shall be 

24 made before the submission of an application 

25 under section 505 of the Federal Food, Drug, 


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1 and Cosmetic Act (21 U.S.C. 355) or section 

2 351 of the Public Health Service Act (42 

3 U.S.C. 262) for the first approval or licensure 

4 of commercial marketing or use of a drug or bi5 ological product that shares at least one active 

6 moiety with an active moiety in the drug or bio7 logical product for which designation is being 

8 requested. 

9 (B) WITHDRAWAL OF REQUEST.—The 

10 sponsor of a drug or biological product may 

11 withdraw a request under paragraph (1) with 

12 respect to the drug or biological product, but 

13 only prior to approval or licensing of the drug 

14 or biological product. 

15 (5) EFFECTS OF WITHDRAWAL OF REQUEST.— 

16 If the sponsor of a drug or biological product with17 draws a request under paragraph (1) with respect to 

18 the drug or biological product— 

19 (A) any designation of the drug or biologi20 cal product as a dormant therapy under sub21 section (a) is cancelled; and 

22 (B) any waiver submitted under this sub23 section with respect to the drug or biological 

24 product is cancelled. 

25 (c) CRITERIA FOR DESIGNATION.— 


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1 (1) IN GENERAL.—Not later than 18 months 

2 after the date of the enactment of this Act, the Sec3 retary shall establish a comprehensive methodology 

4 and criteria for the designation of a drug or biologi5 cal product as a dormant therapy in accordance with 

6 subsection (a). No designation shall be made under 

7 subsection (a) during such 18-month period unless 

8 the Secretary has established such methodology and 

9 criteria. 

10 (2) PUBLIC INPUT.—The Secretary shall con11 sult with relevant stakeholders and provide an op12 portunity for public notice and comment in— 

13 (A) establishing the methodology and cri14 teria under paragraph (1); and 

15 (B) establishing criteria for determining 

16 whether the indication for which the drug or bi17 ological product is being investigated or is in18 tended to be investigated is to address one or 

19 more unmet medical needs (as described in sub20 section (a)(2)(A)). 

21 (d) DEFINITIONS.—In this section: 

22 (1) The term ‘‘prospectively insufficient patent 

23 protection’’ means, with respect to a drug or biologi24 cal product for which a request for designation is 

25 submitted under subsection (b) (in this paragraph 


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1 referred to as the ‘‘dormant therapy’’), that the pro2 tection afforded under patents and patent applica3 tions, when issued as a patent, relating to the dor4 mant therapy, in the aggregate— 

5 (A) are not reasonably anticipated by the 

6 sponsor of the dormant therapy to provide an 

7 adequate scope of protection to prevent the ap8 proval of products that would rely upon or ref9 erence the dormant therapy, in an application 

10 filed under section 505(b)(2) or 505(j) of the 

11 Federal Food, Drug, and Cosmetic Act (21 

12 U.S.C. 355(b)(2), (j)) or section 351(k) of the 

13 Public Health Service Act (42 U.S.C. 262(k)), 

14 or 

15 (B) are not reasonably anticipated by the 

16 sponsor of the dormant therapy to provide pat17 ent protection under such patents and applica18 tions, when issued as a patent, 

19 for a period of 14 years from the date of first ap20 proval or licensing of the dormant therapy for mar21 keting pursuant to an application under section 

22 505(b) of the Federal Food, Drug, and Cosmetic Act 

23 (21 U.S.C. 355(b)) or section 351(a) of the Public 

24 Health Service Act (42 U.S.C. 262(a)). 


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1 (2) The term ‘‘address one or more unmet med2 ical needs’’ refers to— 

3 (A) addressing a need for drugs or biologi4 cal products for the treatment of one or more 

5 life-threatening or other serious diseases or con6 ditions for which no therapy exists; or 

7 (B) if one or more therapies are available 

8 for the treatment of such a disease or condition, 

9 demonstrating through clinical investigations— 

10 (i) one or more improved effects on 

11 serious outcomes of the disease or condi12 tion that are affected by alternative thera13 pies, such as superiority of the drug or bio14 logical product used alone or in combina15 tion with other therapies in an active con16 trolled trial assessing an endpoint reflect17 ing serious morbidity; 

18 (ii) one or more effects on serious out19 comes of the disease or condition not 

20 known to be affected by alternative thera21 pies, such as progressive disability in mul22 tiple sclerosis when alternative therapies 

23 have shown an effect on exacerbations but 

24 have not shown an effect on progressive 

25 disability; 


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1 (iii) an ability— 

2 (I) to provide one or more bene3 fits in patients who are unable to tol4 erate or are unresponsive to alter5 native therapies, such as an 

6 antipsychotic agent that is effective in 

7 people failing standard therapy; or 

8 (II) to be used effectively in com9 bination with other critical agents 

10 that cannot be combined with alter11 native therapies; 

12 (iv) an ability to provide one or more 

13 benefits similar to those of alternative 

14 therapies while— 

15 (I) avoiding serious toxicity that 

16 is present in alternative therapies; or 

17 (II) avoiding less serious toxicity 

18 that is common in alternative thera19 pies and causes discontinuation of 

20 treatment of a life-threatening or seri21 ous disease; or 

22 (v) an ability to provide one or more 

23 benefits similar to those of alternative 

24 therapies but with improvement in some 

25 factor, such as compliance or convenience, 


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1 that is shown to lead to improved effects 

2 on serious outcomes. 

3 (e) PUBLIC NOTICE OF DESIGNATION.—The Sec4 retary request for and notice of the designation of a dor5 mant therapy under paragraph (4) shall be made available 

6 to the public. 

7 SEC. 202. PROMOTING THE DEVELOPMENT OF DORMANT 

8 THERAPIES. 

9 (a) PROTECTIONS FOR DORMANT THERAPY.— 

10 (1) PROTECTION PERIOD.—The term ‘‘protec11 tion period’’ means, with respect to a drug or bio12 logical product designated as a dormant therapy 

13 under section 201(a) (in this section referred to as 

14 the ‘‘dormant therapy’’), the 15-year period begin15 ning on the date on which the Secretary approves an 

16 application under section 505(b) of the Federal 

17 Food, Drug, and Cosmetic Act (21 U.S.C. 355(b)) 

18 or section 351(a) of the Public Health Service Act 

19 (42 U.S.C. 262(a)) for the drug or biological prod20 uct. 

21 (2) APPLICATIONS FILED DURING THE PROTEC22 TION PERIOD.—During the protection period for a 

23 dormant therapy, notwithstanding any other provi24 sion of the Federal Food, Drug, and Cosmetic Act 


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1 (21 U.S.C. 301 et seq.) or the Public Health Service 

2 Act (42 U.S.C. 201 et seq.)— 

3 (A) absent a right of reference from the 

4 holder of such approved application for the dor5 mant therapy, the Secretary shall not approve 

6 an application filed pursuant to section 

7 505(b)(2) or section 505(j) of the Federal 

8 Food, Drug, and Cosmetic Act (21 U.S.C. 

9 355(b)(2), (j)) or section 351(k) of the Public 

10 Health Service Act (42 U.S.C. 262(k)) ref11 erencing or otherwise relying on the approval or 

12 licensure of the dormant therapy; 

13 (B) the Secretary shall not approve— 

14 (i) an application filed pursuant to 

15 such section 505(b)(2) or 505(j) that ref16 erences or otherwise relies on the approval 

17 or licensure of a drug or biological product 

18 that is not the dormant therapy but con19 tains the same active moiety as the dor20 mant therapy; or 

21 (ii) an application filed pursuant to 

22 such section 351(k) that references or oth23 erwise relies on the approval or licensure of 

24 a drug or biological product that is not the 

25 dormant therapy but contains an active 


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1 moiety highly similar to that of the dor2 mant therapy; and 

3 (C) the Secretary shall not approve an ap4 plication filed pursuant to section 505(b)(1) of 

5 the Federal Food, Drug, and Cosmetic Act (21 

6 U.S.C. 355(b)(1)) for a drug that contains the 

7 same active moiety as the dormant therapy, or 

8 an application filed pursuant to section 351(a) 

9 of the Public Health Service Act (42 U.S.C. 

10 262(a)) for a biological product that contains 

11 an active moiety highly similar to that of the 

12 dormant therapy, unless the information pro13 vided to support approval of such application is 

14 comparable in scope and extent (including with 

15 respect to design and extent of preclinical and 

16 clinical testing) to the information provided to 

17 support approval of the application (described 

18 in paragraph (1)) for the dormant therapy. 

19 (3) REGULATIONS.—Not later than 18 months 

20 after the date of the enactment of this Act, the Sec21 retary, in consultation with relevant Federal agen22 cies, shall promulgate such regulations as are re23 quired to implement the incentives described in 

24 paragraph (2). 


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1 (4) PATENT TERM ALIGNMENT WITH DATA

2 PACKAGE PROTECTION PERIOD.— 

3 (A) IN GENERAL.—Notwithstanding any 

4 provision of title 35, United States Code, a 

5 sponsor of a drug or biologic product des6 ignated as a dormant therapy under section 

7 201(a), upon the approval or licensure thereof 

8 under the Federal Food, Drug, and Cosmetic 

9 Act (21 U.S.C. 301 et seq.), and in lieu of fil10 ing a patent term extension application under 

11 section 156(d) of such title 35 (other than ap12 plications for interim extensions filed under 

13 paragraph (5) of such section 156(d)), shall be 

14 entitled to patent term extension in accordance 

15 with this paragraph. 

16 (B) SUBMISSION OF LISTING OF PATENTS

17 AND APPLICATIONS FOR PATENTS.— 

18 (i) SUBMISSION.—The sponsor of the 

19 dormant therapy, within a period to be set 

20 by the Director of the United States Pat21 ent and Trademark Office (in this para22 graph referred to as the ‘‘Director’’), shall 

23 submit to the Director— 

24 (I) the listing of patents and ap25 plications for patents required by secVerDate Mar 15 2010 22:14 Nov 21, 2011 Jkt 019200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\H3497.IH H3497

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1 tion 201(b)(2)(A) with respect to the 

2 dormant therapy; and 

3 (II) a listing of any additional 

4 patents and applications for patents 

5 that, at the time of the submission, 

6 meet the description in section 

7 201(b)(2)(A). 

8 (ii) PERIOD.—The period set by the 

9 Director under clause (i) shall not be less 

10 than 6 months from the date on which the 

11 Secretary approves or licenses the dormant 

12 therapy. 

13 (C) EXTENSION OF PATENTS.— 

14 (i) IN GENERAL.—For each patent 

15 identified pursuant to subparagraph (B)(i), 

16 and for each patent issuing based upon an 

17 application for patent so identified, the Di18 rector shall extend the patent to expire at 

19 the end of the protection period under 

20 paragraph (1) for the dormant therapy, if 

21 the patent would otherwise expire prior to 

22 the end of the protection period. 

23 (ii) APPLICATION OF CERTAIN PROVI24 SIONS.—During the period of an extension 

25 under clause (i)— 


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1 (I) the rights under the patent 

2 shall be limited in the manner pro3 vided under section 156(b) of title 35, 

4 United States Code; and 

5 (II) the terms ‘‘product’’ and 

6 ‘‘approved product’’ in such section 

7 156(b) shall be deemed to include 

8 forms of the active moiety of the dor9 mant therapy and highly similar ac10 tive moieties that might be approved 

11 by the Secretary based upon an appli12 cation filed under section 505(b)(2) or 

13 505(j) of the Federal Food, Drug, 

14 and Cosmetic Act (21 U.S.C. 

15 355(b)(2), (j)) or under section 

16 351(k) of the Public Health Service 

17 Act (42 U.S.C. 262(k)) that ref18 erences or otherwise relies upon the 

19 dormant therapy. 

20 (D) NOTICE OF EXTENSION.—For each 

21 patent that is extended under this paragraph, 

22 the Director shall publish a notice of such ex23 tension. 

24 (E) NOTICE OF WAIVER.—For each patent 

25 identified pursuant to subparagraph (B)(i), and 


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1 each patent issuing based upon an application 

2 for patent so identified, that expires subsequent 

3 to the end of the protection period for the dor4 mant therapy under paragraph (1), the Direc5 tor shall publish a notice that the patent is sub6 ject to the waiver of the right to enforce as de7 scribed section 201(b)(3). 

8 (b) ORPHAN PRODUCTS.—If a drug or biological 

9 product has been designated as a dormant therapy under 

10 section 201(a) of this Act, the protections otherwise appli11 cable with respect to such drug or biological product under 

12 section 527 of the Federal Food, Drug, and Cosmetic Act 

13 (21 U.S.C. 360cc) shall not apply. 

14 (c) STUDY REGARDING DORMANT THERAPIES.—Not 

15 later than one year after the enactment of this Act, the 

16 Secretary shall enter into an agreement with the Director 

17 of the Institute of Medicine— 

18 (1) to conduct a study on intellectual property 

19 laws and their impact on therapy and diagnostic de20 velopment in order to formulate recommendations on 

21 how to facilitate the clinical evaluation and develop22 ment of therapies currently available on the market 

23 for new potential indications; and 

24 (2) not later than 18 months after the date of 

25 the enactment of this Act, to submit a report to the 


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1 Secretary and the Congress containing the results of 

2 such study. 

Æ 


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