I 

113TH CONGRESS 

1ST SESSION H. R. 1958 

To prohibit wholesalers from purchasing prescription drugs from pharmacies, 

and to enhance information and transparency regarding drug wholesalers 

engaged in interstate commerce. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 14, 2013 

Mr. CUMMINGS introduced the following bill; which was referred to the 

Committee on Energy and Commerce 

A BILL 

To prohibit wholesalers from purchasing prescription drugs 

from pharmacies, and to enhance information and transparency regarding drug wholesalers engaged in interstate 

commerce. 

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 ‘‘Gray Market Drug 

5 Reform and Transparency Act of 2013’’. 


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1 SEC. 2. PROHIBITION AGAINST WHOLESALE DISTRIBUTORS 

2 PURCHASING PRESCRIPTION DRUGS FROM 

3 PHARMACIES. 

4 (a) PROHIBITED ACT.—Section 301 of the Federal 

5 Food, Drug, and Cosmetic Act (21 U.S.C. 331) is amend6 ed by adding at the end the following: 

7 ‘‘(ccc) The purchase or receipt by any person re8 quired to report under section 510(b)(4) (relating to 

9 wholesale distributors of prescription drugs) of any drug 

10 subject to section 503(b)(1) from a pharmacy or phar11 macist, except that this paragraph does not apply to the 

12 return of a drug to the wholesale distributor from which 

13 the particular drug was purchased.’’. 

14 (b) MISBRANDING.—Section 502 of the Federal 

15 Food, Drug, and Cosmetic Act (21 U.S.C. 352) is amend16 ed by adding at the end the following: 

17 ‘‘(bb) If it is purchased or received in violation of sec18 tion 301(aaa) (prohibiting the purchase or receipt of pre19 scription drugs by wholesale distributors from phar20 macists).’’. 

21 SEC. 3. REPORTING BY WHOLESALE DISTRIBUTORS OF 

22 PRESCRIPTION DRUGS. 

23 (a) REPORTING REQUIREMENT.— 

24 (1) IN GENERAL.—Section 510 of the Federal 

25 Food, Drug, and Cosmetic Act (21 U.S.C. 360) is 

26 amended— 


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1 (A) in subsection (b), by adding at the end 

2 the following: 

3 ‘‘(4) On or before December 31 of each year, every 

4 person engaged in the wholesale distribution in interstate 

5 commerce of drugs subject to section 503(b)(1) shall re6 port to the Secretary such person’s name, contact infor7 mation for such person’s principal officer (or the designee 

8 thereof), such person’s places of business, such person’s 

9 licensing information (including the type of license and ex10 piration date) for each State in which such person is so 

11 engaged, and such other information as the Secretary 

12 deems appropriate.’’; 

13 (B) in subsection (c)— 

14 (i) by striking the second period at 

15 the end; and 

16 (ii) by adding at the end the fol17 lowing: 

18 ‘‘Every person upon first engaging in the wholesale dis19 tribution in interstate commerce of drugs subject to sec20 tion 503(b)(1) shall immediately report to the Secretary 

21 the information described in subsection (b)(4).’’ 

22 (C) in subsection (d), by adding at the end 

23 the following: ‘‘Every person duly reporting in 

24 accordance with the foregoing subsections shall 

25 immediately report to the Secretary with reVerDate Mar 15 2010 05:53 May 18, 2013 Jkt 029200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1958.IH H1958

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1 spect to any additional establishment which the 

2 person owns or operates in any State and in 

3 which the person begins the wholesale distribu4 tion in interstate commerce of drugs subject to 

5 section 503(b)(1).’’. 

6 (2) REPORTING NUMBER.—Subsection (e) of 

7 section 510 of the Federal Food, Drug, and Cos8 metic Act (21 U.S.C. 360) is amended— 

9 (A) by striking ‘‘registration number’’ and 

10 inserting ‘‘registration or reporting number’’; 

11 and 

12 (B) by inserting ‘‘or reporting in accord13 ance with subsections (b)(4), (c), or (d)’’ after 

14 ‘‘registered in accordance with this section’’. 

15 (3) PUBLIC AVAILABILITY; DATABASE.—Sub16 section (f) of section 510 of the Federal Food, Drug, 

17 and Cosmetic Act (21 U.S.C. 360) is amended— 

18 (A) by striking ‘‘(f)’’ and inserting 

19 ‘‘(f)(1)’’; and 

20 (B) by adding at the end the following: 

21 ‘‘(2)(A) The Secretary, acting directly or by entering 

22 into a contract with a private entity, shall establish and 

23 maintain a database including all information reported 

24 under subsection (b)(4), the second sentence of subsection 

25 (c), and the second sentence of subsection (d). 


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1 ‘‘(B) Subject to subparagraph (C), the Secretary 

2 shall make the information in such database publicly avail3 able, including on the public Website of the Food and 

4 Drug Administration. 

5 ‘‘(C) The Secretary may choose to restrict the Sec6 retary’s disclosure of any information reported under sub7 section (b)(4), (c), or (d)— 

8 ‘‘(i) that relates to a storage facility; and 

9 ‘‘(ii) whose disclosure would, as determined by 

10 the Secretary, compromise the security of such facil11 ity.’’. 

12 (4) CONFORMING AMENDMENTS.— 

13 (A) Section 301(p) of the Federal Food, 

14 Drug, and Cosmetic Act (21 U.S.C. 331(p)) is 

15 amended by inserting ‘‘the failure to report in 

16 accordance with subsection (b)(4), (c), or (d) of 

17 section 510,’’ after ‘‘The failure to register in 

18 accordance with section 510 or 905,’’. 

19 (B) Section 502(o) of the Federal Food, 

20 Drug, and Cosmetic Act (21 U.S.C. 352(o)) is 

21 amended by inserting ‘‘if it was distributed in 

22 interstate commerce by a person in violation of 

23 the reporting requirements of subsection (b)(4), 

24 (c), or (d) of section 510,’’ before ‘‘if it was not 

25 included’’. 


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1 (C) Section 510 of the Federal Food, 

2 Drug, and Cosmetic Act (21 U.S.C. 360) is 

3 amended— 

4 (i) in subsection (g)— 

5 (I) in paragraph (3), by adding 

6 ‘‘or’’ at the end; 

7 (II) by striking paragraph (4); 

8 (III) by redesignating paragraph 

9 (5) as paragraph (4); 

10 (IV) in paragraph (4) (as so re11 designated), by inserting ‘‘or report12 ing, as applicable,’’ after ‘‘registra13 tion’’; and 

14 (V) by striking the matter fol15 lowing paragraph (4) (as so redesig16 nated); 

17 (ii) in subsection (h), by adding at the 

18 end the following: 

19 ‘‘(7) WHOLESALE DISTRIBUTORS.—Every es20 tablishment in any State used by a person required 

21 to report under subsection (b)(4), (c), or (d) for the 

22 wholesale distribution in interstate commerce of 

23 drugs subject to section 503(b)(1) shall be subject to 

24 inspection pursuant to section 704.’’; and 


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1 (iii) in subsection (j), by adding at the 

2 end the following: 

3 ‘‘(5) The provisions of this subsection shall apply 

4 with respect to a person required to report under sub5 section (b)(4), (c), or (d) for the wholesale distribution in 

6 interstate commerce of drugs subject to section 503(b)(1) 

7 to the same extent and in the same manner as such provi8 sions apply to persons required to register under sub9 section (b), (c), (d), or (i), except that— 

10 ‘‘(A) any reference to manufacturing shall be 

11 treated as a reference to wholesale distribution; and 

12 ‘‘(B) any reference to a drug shall be treated as 

13 a reference to a drug subject to section 503(b)(1).’’; 

14 and 

15 (D) in subsection (p)(1), by striking ‘‘Reg16 istrations and listings under this section’’ and 

17 inserting ‘‘Registrations and listings under this 

18 section, and reports under subsection (b)(4), 

19 (c), and (d)’’ before ‘‘shall be submitted’’. 

20 (b) INFORMATION ON STATE ACTIONS AGAINST

21 WHOLESALE DISTRIBUTORS OF PRESCRIPTION DRUGS.— 

22 Paragraph (2) of section 510(f) of the Federal Food, 

23 Drug, and Cosmetic Act (21 U.S.C. 360(f)), as added by 

24 subsection (a)(3)(B) of this section, is amended— 


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1 (1) in subparagraph (A), by adding at the end 

2 of the subparagraph the following: ‘‘Such database 

3 shall also include information on actions (such as 

4 suspension or revocation of licensing) taken by 

5 States against persons engaged in wholesale dis6 tribution of drugs subject to section 503(b)(1).’’; 

7 and 

8 (2) by adding at the end the following: 

9 ‘‘(D) The Secretary shall encourage States 

10 to report the type of information described in 

11 the second sentence of subparagraph (A) to the 

12 Food and Drug Administration— 

13 ‘‘(i) in a consistent manner; and 

14 ‘‘(ii) on a voluntary basis.’’. 

15 (c) FEES FOR REPORTING.—Subchapter C of chapter 

16 VII (21 U.S.C. 379f et seq.) is amended by adding at the 

17 end the following: 

18 ‘‘PART 9—FEES RELATING TO WHOLESALE 

19 DISTRIBUTORS OF PRESCRIPTION DRUGS 

20 ‘‘SEC. 744K. AUTHORITY TO ASSESS AND COLLECT FEES. 

21 ‘‘(a) IN GENERAL.—For fiscal year 2013 and each 

22 subsequent fiscal year, the Secretary shall assess and col23 lect fees under this section from each person that reports 

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1 tribution in interstate commerce of drugs subject to sec2 tion 503(b)(1). 

3 ‘‘(b) ESTABLISHMENT OF AMOUNT.— 

4 ‘‘(1) IN GENERAL.—Not later than 1 year after 

5 the date of the enactment of the Gray Market Drug 

6 Reform and Transparency Act of 2013, the Sec7 retary shall promulgate a final regulation estab8 lishing the amount of fees under this section for the 

9 period of fiscal years 2014 through 2018 so as to 

10 generate a total revenue amount not exceeding the 

11 Secretary’s estimate of 100 percent of the costs de12 scribed in subsection (c) during such period. 

13 ‘‘(2) CONSIDERATION.—In establishing the 

14 amount of fees under this section, the Secretary 

15 shall take into consideration the amount of annual 

16 revenues of a person to be assessed such fees in 

17 comparison with the amount of annual revenues of 

18 other persons to be assessed such fees. 

19 ‘‘(c) COSTS TO BE FUNDED THROUGH FEES.—The 

20 fees authorized by this section shall only be collected and 

21 available to pay the costs incurred by the Food and Drug 

22 Administration in— 

23 ‘‘(1) implementing the reporting requirement 

24 under section 510(b)(4); and 


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1 ‘‘(2) establishing and maintaining an up-to-date 

2 database of the information collected pursuant to 

3 such requirement. 

4 ‘‘(d) CREDITING AND AVAILABILITY FEES.—Fees 

5 authorized under subsection (a) shall be collected and 

6 available for obligation only to the extent and in the 

7 amount provided in advance in appropriation Acts. Such 

8 fees are authorized to remain available until expended. 

9 Such sums as may be necessary may be transferred from 

10 the Food and Drug Administration salaries and expenses 

11 appropriation account without fiscal year limitation to 

12 such appropriation account for salaries and expenses with 

13 such fiscal year limitation. The sums transferred shall be 

14 available solely for the costs described in subsection (c). 

15 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For 

16 each of the fiscal years 2014 through 2018, there is au17 thorized to be appropriated for fees under this section an 

18 amount equal to the total revenue amount determined 

19 under subsection (b) for the fiscal year. 

20 ‘‘(f) OFFSET.—If the sum of the cumulative amount 

21 of fees collected under this section for the fiscal years 

22 2014 through 2016 and the amount of fees estimated to 

23 be collected under this section for fiscal year 2017 exceeds 

24 the cumulative amount appropriated pursuant to sub25 section (e) for the fiscal years 2014 through 2017, the 


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1 excess shall be credited to the appropriation account of 

2 the Food and Drug Administration as provided in sub3 section (d), and shall be subtracted from the amount of 

4 fees that would otherwise be authorized to be collected 

5 under this section pursuant to appropriation Acts for fis6 cal year 2018.’’. 

7 SEC. 4. IDENTIFICATION OF SALES PRICE FOR DRUGS IN 

8 SHORTAGE. 

9 (a) IDENTIFICATION OF SALES PRICE FOR DRUGS IN

10 SHORTAGE.—Paragraph (1) of section 503(e) of the Fed11 eral Food, Drug, and Cosmetic Act (21 U.S.C. 353(e)) 

12 is amended— 

13 (1) in subparagraph (A), by inserting before the 

14 period at the end the following: ‘‘, the amount paid 

15 for such drug by the person receiving it if such drug 

16 is in shortage at the time of the sale, and the 

17 amount paid for such drug for any prior sale that 

18 occurred at a time when such drug was in short19 age’’; and 

20 (2) by adding at the end the following new sub21 paragraph: 

22 ‘‘(C) In this paragraph, the term ‘in shortage’ means 

23 listed on the public Website of the Food and Drug Admin24 istration, at the time of the sale to be identified in the 


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1 statement required by subparagraph (A), as being in 

2 shortage.’’. 

3 (b) APPLICABILITY.—The amendment made by sub4 section (a) applies only with respect to sales of a drug 

5 occurring on or after the date that is 1 year after the date 

6 of the enactment of this Act. 

Æ 


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