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[House Report 113-565]
[From the U.S. Government Printing Office]


113th Congress  }                                     {   Rept. 113-565
  2d Session    }        HOUSE OF REPRESENTATIVES     {          Part 2

=======================================================================
 
                   IMPROVING REGULATORY TRANSPARENCY 
                     FOR NEW MEDICAL THERAPIES ACT 

                                _______
                                

 September 19, 2014.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

   Mr. Goodlatte, from the Committee on the Judiciary, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 4299]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on the Judiciary, to whom was referred the 
bill (H.R. 4299) to amend the Controlled Substances Act with 
respect to drug scheduling recommendations by the Secretary of 
Health and Human Services, and with respect to registration of 
manufacturers and distributors seeking to conduct clinical 
testing, having considered the same, report favorably thereon 
with an amendment and recommend that the bill as amended do 
pass.

                                CONTENTS

                                                                   Page
The Amendment....................................................     1
Purpose and Summary..............................................     2
Background and Need for the Legislation..........................     2
Hearings.........................................................     3
Committee Consideration..........................................     3
Committee Votes..................................................     3
Committee Oversight Findings.....................................     3
New Budget Authority and Tax Expenditures........................     4
Congressional Budget Office Cost Estimate........................     4
Duplication of Federal Programs..................................     5
Disclosure of Directed Rule Makings..............................     5
Performance Goals and Objectives.................................     5
Advisory on Earmarks.............................................     5
Section-by-Section Analysis......................................     5
Changes in Existing Law Made by the Bill, as Reported............     6

                             The Amendment

    The amendment is as follows:
  Strike all that follows after the enacting clause, and insert 
the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Improving Regulatory Transparency for 
New Medical Therapies Act''.

SEC. 2. SCHEDULING OF SUBSTANCES INCLUDED IN NEW FDA-APPROVED DRUGS.

  Section 201(a) of the Controlled Substances Act (21 U.S.C. 811(a)) is 
amended by adding at the end the following: ``Any such proceedings 
initiated at the request of the Secretary under this subsection to 
control a drug or other substance not previously scheduled, where the 
Secretary has recommended the drug or other substance be placed in 
schedule II, III, IV, or V, shall be commenced not later than 120 days 
after receipt of written recommendations from the Secretary. The final 
rule shall be issued not later than 60 days after the date on which 
both the public comment period has closed and the drug or other 
substance is the subject of an approved new drug application under 
section 505 of the Federal Food, Drug, and Cosmetic Act, unless a 
hearing on the proposed rule is granted by the Attorney General.''.

SEC. 3. ENHANCING NEW DRUG DEVELOPMENT.

  Section 303 of the Controlled Substances Act (21 U.S.C. 823) is 
amended by adding at the end the following:
  ``(i)(1) For the purposes of registration to manufacture a controlled 
substance under subsection (d) of this section for use only in a 
clinical trial, the Attorney General shall register an applicant or 
serve an order to show cause upon an applicant pursuant to section 
304(c) of this Act not later than 180 days after receipt of an 
application and all information the Attorney General deems necessary to 
make a determination under subsection (d).
  ``(2) For the purposes of registration to manufacture a controlled 
substance under subsection (a) for use only in a clinical trial, the 
Attorney General shall, in accordance with regulations issued by the 
Attorney General, issue a notice of application not later than 90 days 
after receipt of an application and all information the Attorney 
General deems necessary to issue a notice of application. Following the 
close of the comment period and receipt of all information the Attorney 
General deems necessary to make a determination under subsection (a), 
the Attorney General shall register an applicant or serve an order to 
show cause upon an applicant pursuant to section 304(c) of this Act 
within 180 days, unless a hearing on the application has been granted 
by the Attorney General pursuant to section 1008(i) of the Controlled 
Substances Import and Export Act.''.

                          Purpose and Summary

    H.R. 4299 improves patient access to new and innovative 
medications by streamlining the process for scheduling new 
drugs under the Controlled Substances Act (CSA). H.R. 4299 also 
amends the Drug Enforcement Administration's (DEA) approval 
process for drugs to be used in clinical trials by requiring 
that, for the purposes of a DEA registration to manufacture or 
distribute a controlled substance for use only in connection 
with clinical trials, the DEA must either register the 
manufacturer for the purposes of a clinical trial or serve an 
order to show cause on the applicant within 180 days.

                Background and Need for the Legislation

    Under current law, drugs and substances that have not been 
marketed previously in the United States and that have the 
potential for abuse and/or dependency must be approved by the 
Food and Drug Administration (FDA), and also must be scheduled 
under the CSA by the DEA before a company can begin marketing 
its product.
    During FDA's approval process, the agency examines the 
abuse and dependency potential of the new drug and makes a 
scheduling recommendation through the Secretary of HHS to the 
DEA (through the Attorney General). In formulating its 
recommendations, FDA conducts an eight-part test outlined in 
Section 201(c) of the CSA.\1\ There is no time limit on the FDA 
approval process. Once it receives the FDA's report and 
recommendations, the DEA also utilizes the eight-part test in 
Section 201(c) to conduct its review. FDA's decisions related 
to scientific and medical matters\2\ are binding on the DEA, 
but FDA's scheduling recommendation is only a recommendation, 
which DEA must consider in its independent determination. In 
recent years, some companies have complained that the length of 
time DEA has taken in its scheduling decisions has delayed 
their product launches, which has denied patients access to the 
new therapies. As amended, H.R. 4299 requires that, for drugs 
that FDA has recommended be placed in Schedules II, III, IV, 
and V, DEA must initiate the scheduling process not later than 
120 days after it receives the FDA's analysis and 
recommendations. It also requires that the DEA issue a final 
rule not later than 60 days after the date on which both the 
public comment period has closed and the FDA has approved the 
drug.
---------------------------------------------------------------------------
    \1\21 U.S.C. Sec. 811(c).
    \2\See 21 U.S.C. Sec. 811(c)(2) and (3).
---------------------------------------------------------------------------
    H.R. 4299 also amends the DEA approval process for drugs to 
be used in clinical trials, because there have been complaints 
from the pharmaceutical industry that DEA has taken too much 
time to make scheduling decisions for drugs to be used only in 
clinical trials. It would do this by requiring that, for the 
purposes of a DEA registration to manufacture or distribute a 
controlled substance for use only in connection with clinical 
trials, the DEA must either register the manufacturer for the 
purposes of a clinical trial or serve an order to show cause on 
the applicant within 180 days. H.R. 4299 also provides that 
this time period does not begin until the application and all 
necessary information is submitted to DEA, which includes the 
notice and comment period required under the regulations for 
applications to manufacture Schedule I or II drugs.

                                Hearings

    The Committee on the Judiciary held no hearings on H.R. 
4299.

                        Committee Consideration

    On September 10, 2014, the Committee met in open session 
and ordered the bill H.R. 4299 favorably reported with an 
amendment, by voice vote, a quorum being present.

                            Committee Votes

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that there 
were no recorded votes during the Committee's consideration of 
H.R. 4299.

                      Committee Oversight Findings

    In compliance with clause 3(c)(1) of rule XIII of the Rules 
of the House of Representatives, the Committee advises that the 
findings and recommendations of the Committee, based on 
oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

               New Budget Authority and Tax Expenditures

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives is inapplicable because this legislation does 
not provide new budgetary authority or increased tax 
expenditures.

               Congressional Budget Office Cost Estimate

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, the Committee sets forth, with 
respect to the bill, H.R. 4299, the following estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 17, 2014.
Hon. Bob Goodlatte, Chairman,
Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 4299, the 
``Improving Regulatory Transparency for New Medical Therapies 
Act.''
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Mark 
Grabowicz, who can be reached at 226-2860.
            Sincerely,
                                      Douglas W. Elmendorf,
                                                  Director.

Enclosure

cc:
        Honorable John Conyers, Jr.
        Ranking Member




           H.R. 4299--Improving Regulatory Transparency for 
                       New Medical Therapies Act.

      As ordered reported by the House Committee on the Judiciary 
                         on September 10, 2014.




    H.R. 4299 would modify the administrative procedures 
followed by the Department of Justice in regulating new drugs 
that are already approved by the Food and Drug Administration 
and in authorizing drugs to be used in clinical trials. The 
legislation would aim to streamline the current review and 
approval process. CBO estimates that implementing the bill 
would have no significant costs to the Federal Government. 
Enacting the legislation would not affect direct spending or 
revenues; therefore, pay-as-you-go procedures do not apply.
    H.R. 4299 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments.
    On June 26, 2014, CBO transmitted a cost estimate for H.R. 
4299 as ordered reported by the House Committee on Energy and 
Commerce on June 10, 2014. The cost estimates are the same.
    The CBO staff contact for this estimate is Mark Grabowicz. 
The estimate was approved by Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                    Duplication of Federal Programs

    No provision of H.R. 4299 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 H.R. 4299 specifically directs 
to be completed no specific rule makings within the meaning of 
5 U.S.C. 551.

                    Performance Goals and Objectives

    The Committee states that pursuant to clause 3(c)(4) of 
rule XIII of the Rules of the House of Representatives, H.R. 
4299 streamlines the process for scheduling new drugs under the 
Controlled Substances Act.

                          Advisory on Earmarks

    In accordance with clause 9 of rule XXI of the Rules of the 
House of Representatives, H.R. 4299 does not contain any 
congressional earmarks, limited tax benefits, or limited tariff 
benefits as defined in clause 9(e), 9(f), or 9(g) of Rule XXI.

                      Section-by-Section Analysis

    The following discussion describes the bill as reported by 
the Committee.
    Sec. 1. Short title. Section 1 sets forth the short title 
of the bill as the Improving Regulatory Transparency for New 
Medical Therapies Act.
    Sec. 2. Scheduling of Substances Included in New FDA-
Approved Drugs. Section 2 imposes a statutory timeline on DEA 
for scheduling new drugs. Specifically, it requires that for 
drugs that FDA has recommended be placed in Schedules II, III, 
IV, and V, DEA initiate the scheduling process not later than 
120 days after it receives the FDA's analysis and 
recommendations. It also requires that the DEA issue a final 
rule not later than 60 days after the date on which both the 
public comment period has closed and the FDA has approved the 
drug. Though it imposes new statutory timelines on DEA, H.R. 
4299 as reported maintains DEA's existing statutory authority 
to conduct its own analysis of drugs for scheduling purposes, 
as required under 21 U.S.C. 811(c), and preserves the authority 
of the Attorney General to schedule a drug in his discretion, 
as required in 21 U.S.C. 811(a).
    Sec. 3. Enhancing New Drug Development. Section 3 requires 
DEA to either register a manufacturer for the purposes of a 
clinical trial or serve an order to show cause on the applicant 
within 180 days. Section 3 also provides that this time period 
does not begin until the application and all necessary 
information is submitted to DEA, which includes the notice and 
comment period required under the regulations for applications 
to manufacture Schedule I or II drugs.

         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 (new matter is 
printed in italics and existing law in which no change is 
proposed is shown in roman):

                       CONTROLLED SUBSTANCES ACT

                   TITLE II--CONTROL AND ENFORCEMENT

                              short title

    Sec. 100. This title may be cited as the ``Controlled 
Substances Act''.

           *       *       *       *       *       *       *


         Part B--Authority To Control; Standards and Schedules

        authority and criteria for classification of substances

    Sec. 201. (a) The Attorney General shall apply the 
provisions of this title to the controlled substances listed in 
the schedules established by section 202 of this title and to 
any other drug or other substance added to such schedules under 
this title. Except as provided in subsections (d) and (e), the 
Attorney General may by rule--
            (1) * * *

           *       *       *       *       *       *       *

Rules of the Attorney General under this subsection shall be 
made on the record after opportunity for a hearing pursuant to 
the rulemaking procedures prescribed by subchapter II of 
chapter 5 of title 5 of the United States Code. Proceedings for 
the issuance, amendment, or repeal of such rules may be 
initiated by the Attorney General (1) on his own motion, (2) at 
the request of the Secretary, or (3) on the petition of any 
interested party. Any such proceedings initiated at the request 
of the Secretary under this subsection to control a drug or 
other substance not previously scheduled, where the Secretary 
has recommended the drug or other substance be placed in 
schedule II, III, IV, or V, shall be commenced not later than 
120 days after receipt of written recommendations from the 
Secretary. The final rule shall be issued not later than 60 
days after the date on which both the public comment period has 
closed and the drug or other substance is the subject of an 
approved new drug application under section 505 of the Federal 
Food, Drug, and Cosmetic Act, unless a hearing on the proposed 
rule is granted by the Attorney General.

           *       *       *       *       *       *       *


Part C--Registration of Manufacturers, Distributors, and Dispensers of 
Controlled Substances; Piperidine Reporting

           *       *       *       *       *       *       *


                       registration requirements

    Sec. 303. (a) * * *

           *       *       *       *       *       *       *

    (i)(1) For the purposes of registration to manufacture a 
controlled substance under subsection (d) of this section for 
use only in a clinical trial, the Attorney General shall 
register an applicant or serve an order to show cause upon an 
applicant pursuant to section 304(c) of this Act not later than 
180 days after receipt of an application and all information 
the Attorney General deems necessary to make a determination 
under subsection (d).
    (2) For the purposes of registration to manufacture a 
controlled substance under subsection (a) for use only in a 
clinical trial, the Attorney General shall, in accordance with 
regulations issued by the Attorney General, issue a notice of 
application not later than 90 days after receipt of an 
application and all information the Attorney General deems 
necessary to issue a notice of application. Following the close 
of the comment period and receipt of all information the 
Attorney General deems necessary to make a determination under 
subsection (a), the Attorney General shall register an 
applicant or serve an order to show cause upon an applicant 
pursuant to section 304(c) of this Act within 180 days, unless 
a hearing on the application has been granted by the Attorney 
General pursuant to section 1008(i) of the Controlled 
Substances Import and Export Act.

           *       *       *       *       *       *       *


                                  
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