II

107TH CONGRESS

1ST SESSION S. 1346

To amend the Federal Food, Drug, and Cosmetic Act with regard to new

animal drugs, and for other purposes.

IN THE SENATE OF THE UNITED STATES

AUGUST 2, 2001

Mr. SESSIONS (for himself, Mr. BINGAMAN, Mr. ALLARD, and Ms. COLLINS)

introduced the following bill; which was read twice and referred to the

Committee on Finance

A BILL

To amend the Federal Food, Drug, and Cosmetic Act with

regard to new animal drugs, and for other purposes.

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 ‘‘Minor Use and Minor

5 Species Animal Health Act of 2001’’.

6 SEC. 2. FINDINGS.

7 Congress makes the following findings:

8 (1) There is a severe shortage of approved new

9 animal drugs for use in minor species.
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1 (2) There is a severe shortage of approved new

2 animal drugs for treating animal diseases and condi3 tions that occur infrequently or in limited geographic

4 areas.

5 (3) Because of the small market shares, low6 profit margins involved, and capital investment re7 quired, it is generally not economically feasible for

8 new animal drug sponsors to pursue approvals for

9 these species, diseases, and conditions.

10 (4) Because the populations for which such new

11 animal drugs are intended may be small and condi12 tions of animal management may vary widely, it is

13 often difficult to design and conduct studies to es14 tablish drug safety and effectiveness under tradi15 tional new animal drug approval processes.

16 (5) It is in the public interest and in the inter17 est of animal welfare to provide for special proce18 dures to allow the lawful use and marketing of cer19 tain new animal drugs for minor species and minor

20 uses that take into account these special cir21 cumstances and that ensure that such drugs do not

22 endanger animal or public health.

23 (6) Exclusive marketing rights and tax credits

24 for clinical testing expenses have helped encourage

25 the development of ‘orphan’ drugs for human use,
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1 and comparable incentives should encourage the de2 velopment of new animal drugs for minor species

3 and minor uses.

4 SEC. 3. AMENDMENTS TO THE FEDERAL FOOD, DRUG, AND

5 COSMETIC ACT.

6 (a) DEFINITIONS.—Section 201 of the Federal, Food,

7 Drug, and Cosmetic Act (21 U.S.C. 321) is amended by

8 adding at the end the following:

9 ‘‘(kk) The term ‘major species’ means cattle, horses,

10 swine, chickens, turkeys, dogs, and cats, except that the

11 Secretary may revise this definition by regulation.

12 ‘‘(ll) The term ‘minor species’ means animals other

13 than humans that are not major species.

14 ‘‘(mm) The term ‘minor use’ means the intended use

15 of a drug in a major species for an indication that occurs

16 infrequently or in limited geographical areas.’’.

17 (b) THREE-YEAR EXCLUSIVITY FOR MINOR USE AND

18 MINOR SPECIES APPROVALS.—Section 512(c)(2)(F) (ii),

19 (iii), and (v) of the Federal Food, Drug, and Cosmetic

20 Act is amended by striking ‘‘(other than bioequivalence or

21 residue studies)’’ and inserting ‘‘(other than bioequiva22 lence studies or final residue depletion studies, except final

23 residue depletion studies for minor uses or minor species)’’

24 every place it appears.
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1 (c) SCOPE OF REVIEW FOR MINOR USE AND MINOR

2 SPECIES APPLICATIONS.—Section 512(d) of the Federal

3 Food, Drug, and Cosmetic Act is amended by adding at

4 the end the following new paragraph:

5 ‘‘(5) In reviewing an application that proposes

6 a change to add an intended use for a minor use or

7 a minor species to an approved new animal drug ap8 plication, the Secretary shall reevaluate only the rel9 evant information in the approved application to de10 termine whether the application for the minor use or

11 minor species can be approved. A decision to ap12 prove the application for the minor use or minor

13 species is not, implicitly or explicitly, a reaffirmation

14 of the approval of the original application.’’.

15 (d) MINOR USE AND MINOR SPECIES NEW ANIMAL

16 DRUGS.—Chapter V of the Federal Food, Drug, and Cos17 metic Act (21 U.S.C. 351 et seq.) is amended by adding

18 at the end the following:

19 ‘‘Subchapter F—New Animal Drugs

20 For Minor Use And Minor Species

21 ‘‘SEC. 571. CONDITIONAL APPROVAL OF NEW ANIMAL

22 DRUGS FOR MINOR USE AND MINOR SPECIES.

23 ‘‘(a)(1) Except as provided in paragraph (3) of this

24 section, any person may file with the Secretary an applica25 tion for conditional approval of a new animal drug in-
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1 tended for a minor use or a minor species. Such an appli2 cation may not be a supplement to an application ap3 proved under section 512. Such application must comply

4 in all respects with the provisions of section 512 of this

5 Act except 512(b)(2), 512(c)(1), 512(c)(2), 512(c)(3),

6 512(d)(1), 512(e), 512(h), and 512(n) unless otherwise

7 stated in this section, and any additional provisions of this

8 section.

9 ‘‘(2) The applicant shall submit to the Secretary as

10 part of an application for the conditional approval of a

11 new animal drug—

12 ‘‘(A) all information necessary to meet the re13 quirements of section 512(b)(1) except 512(b)(1)(A);

14 ‘‘(B) full reports of investigations which have

15 been made to show whether or not such drug is safe

16 and there is a reasonable expectation of effectiveness

17 for use;

18 ‘‘(C) data for establishing a conditional dose;

19 ‘‘(D) projections of expected need and the jus20 tification for that expectation based on the best in21 formation available;

22 ‘‘(E) information regarding the quantity of

23 drug expected to be distributed on an annual basis

24 to meet the expected need; and
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1 ‘‘(F) a commitment that the applicant will con2 duct additional investigations to meet the require3 ments for the full demonstration of effectiveness

4 under section 512(d)(1)(E) within 5 years.

5 ‘‘(3) A person may not file an application under para6 graph (1) if without adequate justification—

7 ‘‘(A) the person has previously filed an applica8 tion for conditional approval under paragraph (1)

9 for the same drug, conditions of use, and dosage

10 form whether or not subsequently conditionally ap11 proved by the Secretary under subsection (b), or

12 ‘‘(B) the person obtained the application, or

13 data or other information contained therein, directly

14 or indirectly from the person who filed for condi15 tional approval under paragraph (1) for the same

16 drug and conditions of use whether or not subse17 quently conditionally approved by the Secretary

18 under subsection (b).

19 ‘‘(b) Within 180 days after the filing of an applica20 tion pursuant to subsection (a), or such additional period

21 as may be agreed upon by the Secretary and the applicant,

22 the Secretary shall either—

23 ‘‘(1) issue an order, effective for one year, con24 ditionally approving the application if the Secretary

25 finds that none of the grounds for denying condi-
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1 tional approval, specified in subsection (c) of this

2 section applies, or

3 ‘‘(2) give the applicant notice of an opportunity

4 for an informal hearing on the question whether

5 such application can be conditionally approved.

6 ‘‘(c) If the Secretary finds, after giving the applicant

7 notice and an opportunity for an informal hearing, that—

8 ‘‘(1) any of the provisions of section

9 512(d)(1)(A) through (D) or (F) through (I) are ap10 plicable;

11 ‘‘(2) the information submitted to the Secretary

12 as part of the application and any other information

13 before the Secretary with respect to such drug, is in14 sufficient to show that there is a reasonable expecta15 tion that the drug will have the effect it purports or

16 is represented to have under the conditions of use

17 prescribed, recommended, or suggested in the pro18 posed labeling thereof; or

19 ‘‘(3) another person has received approval

20 under section 512 for a drug with the same active

21 ingredient or ingredients, the same conditions of use,

22 and the same dosage form and that person is able

23 to assure the availability of sufficient quantities of

24 the drug to meet the needs for which the drug is in25 tended;
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1 the Secretary shall issue an order refusing to conditionally

2 approve the application. If, after such notice and oppor3 tunity for an informal hearing, the Secretary finds that

4 subparagraphs (1) through (3) do not apply, the Secretary

5 shall issue an order conditionally approving the application

6 effective for one year. Any order issued under this sub7 section refusing to conditionally approve an application

8 shall state the findings upon which it is based.

9 ‘‘(d) A conditional approval under this section is ef10 fective for a 1-year period and is thereafter renewable by

11 the Secretary annually for up to 4 additional 1-year terms.

12 A conditional approval shall be in effect for no more than

13 5 years from the date of approval under subsections (b)(1)

14 or (c) of this section unless extended as provided for in

15 subsection (h) of this section. The following shall also

16 apply:

17 ‘‘(1) No later than 90 days from the end of the

18 1-year period for which the original or renewed con19 ditional approval is effective, the applicant may sub20 mit a request to renew a conditional approval for an

21 additional 1-year term.

22 ‘‘(2) If the renewal request is submitted no

23 later than 90-days from the end of the 1-year pe24 riod, a conditional approval shall be deemed renewed

25 at the end of the 1-year period, or at the end of an
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1 additional 90-day extension when deemed necessary

2 to complete review of an application, unless the Sec3 retary makes a written determination before the ex4 piration of the 1-year period or the 90-day extension

5 that—

6 ‘‘(A) the request fails to contain sufficient

7 information to show that—

8 ‘‘(i) the applicant is making sufficient

9 progress toward meeting approval require10 ments under section 512(d)(1)(E), and is

11 likely to be able to fulfill those require12 ments and obtain an approval under sec13 tion 512 before the expiration of the 5-year

14 maximum term of the conditional approval;

15 ‘‘(ii) the quantity of the drug that has

16 been distributed is consistent with the in17 tended use, unless there is adequate expla18 nation that ensures that the drug is only

19 used for its intended purpose; or

20 ‘‘(iii) no other drug with the same ac21 tive ingredient or ingredients, for the same

22 conditions of use, and dosage form has re23 ceived approval under section 512, or if

24 such a drug has been approved, that the

25 holder of the approved application is un-
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1 able to assure the availability of sufficient

2 quantities of the drug to meet the needs

3 for which the drug is intended; or

4 ‘‘(B) 1 or more of the conditions of sub5 section 512(e)(1)(A) through (B) and (D)

6 through (F) are met.

7 ‘‘(3) If the Secretary makes a timely written

8 determination that a conditional approval should not

9 be renewed, or the applicant fails to submit a timely

10 renewal request, the Secretary shall issue an order

11 refusing to renew the conditional approval, and such

12 conditional approval shall be deemed withdrawn and

13 no longer in effect. The Secretary shall thereafter

14 provide an opportunity for an informal hearing to

15 the applicant on the issue whether the conditional

16 approval shall be reinstated.

17 ‘‘(e)(1) The Secretary shall issue an order with18 drawing conditional approval of an application filed pursu19 ant to subsection (a) if the Secretary finds that another

20 person has received approval under section 512 for a drug

21 with the same active ingredient or ingredients, the same

22 conditions of use, and dosage form, and that person is able

23 to assure the availability of sufficient quantities of the

24 drug to meet the needs for which the drug is intended.
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1 ‘‘(2) The Secretary shall, after due notice and oppor2 tunity for an informal hearing to the applicant, issue an

3 order withdrawing conditional approval of an application

4 filed pursuant to subsection (a) if the Secretary finds

5 that—

6 ‘‘(A) any of the provisions of section

7 512(e)(1)(A) through (B) or (D) through (F) are

8 applicable; or

9 ‘‘(B) on the basis of new information before the

10 Secretary with respect to such drug, evaluated to11 gether with the evidence available to the Secretary

12 when the application was conditionally approved,

13 that there is not a reasonable expectation that such

14 drug will have the effect it purports or is rep15 resented to have under the conditions of use pre16 scribed, recommended, or suggested in the labeling

17 thereof;

18 ‘‘(3) The Secretary may also, after due notice and

19 opportunity for an informal hearing to the applicant, issue

20 an order withdrawing conditional approval of an applica21 tion filed pursuant to subsection (a) if the Secretary finds

22 that any of the provisions of section 512(e)(2) are applica23 ble.

24 ‘‘(f)(1) The label and labeling of a new animal drug

25 with a conditional approval under this section shall—
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1 ‘‘(A) bear the statement, ‘‘conditionally ap2 proved by FDA pending a full demonstration of ef3 fectiveness under application number’’; and

4 ‘‘(B) contain such other information as pre5 scribed by the Secretary.

6 ‘‘(2) An intended use that is the subject of a condi7 tional approval under this section shall not be included

8 in the same product label with any intended use approved

9 under section 512.

10 ‘‘(g) A conditionally-approved new animal drug appli11 cation may not be amended or supplemented to add indi12 cations for use.

13 ‘‘(h) 180 days prior to the termination date estab14 lished under subsection (d)(1) of this section, a sponsor

15 shall have submitted all the information necessary to sup16 port a complete new animal drug application in accordance

17 with section 512(b)(1) or the conditional approval issued

18 under this section is no longer in effect. Upon receipt of

19 this information, the Secretary shall either—

20 ‘‘(1) issue an order approving the application if

21 the Secretary finds that none of the grounds for de22 nying approval specified in 512(d)(1) applies, or

23 ‘‘(2) give the sponsor an opportunity for a hear24 ing before the Secretary under 512(d) on the ques25 tion whether such application can be approved. Upon
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1 issuance of an order approving the application, prod2 uct labeling and administrative records of approval

3 shall be modified accordingly. If the Secretary has

4 not issued an order under section 512(c) approving

5 such application prior to the termination date estab6 lished under subsection (d)(1) of this section, the

7 conditional approval issued under this section is no

8 longer in effect unless the Secretary grants an ex9 tension of an additional 180-day period so that the

10 Secretary can complete review of the application.

11 The decision to grant an extension is committed to

12 Agency discretion and not subject to judicial review.

13 ‘‘(i) The decision of the Secretary under subsections

14 (c), (d), or (e) of this section, refusing or withdrawing con15 ditional approval of an application shall constitute final

16 agency action subject to judicial review.

17 ‘‘SEC. 572. INDEX OF LEGALLY-MARKETED UNAPPROVED

18 NEW ANIMAL DRUGS FOR MINOR SPECIES.

19 ‘‘(a) The Secretary shall establish an index of unap20 proved minor species new animal drugs that may be law21 fully marketed for use in minor species. The index shall

22 be limited to—

23 ‘‘(1) new animal drugs intended for use in a

24 minor species for which there is a reasonable cer-
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1 tainty that the animal or edible products from the

2 animal will not be consumed by humans, and

3 ‘‘(2) new animal drugs intended for use in an

4 early life stage of a food-producing minor species

5 where human food safety can be demonstrated in ac6 cordance with the standard of section 512(d) by

7 showing that—

8 ‘‘(A) there is no significant likelihood that

9 harmful residues will be present in the animal

10 presented as food for humans as a result of

11 treatment at the early life stage;

12 ‘‘(B) there is no significant likelihood that

13 harmful residues will be present in the animal

14 presented as food for food-producing animals as

15 a result of treatment at the early life stage; and

16 ‘‘(C) there are no concerns about the use

17 of the drug at later life stages because a toler18 ance and regulatory method to test for the drug

19 at later life stages are available or there is no

20 practical use for the drug in later life stages.

21 ‘‘(b) Any person intending to file a request under this

22 section shall be entitled to one or more conferences to dis23 cuss the requirements for indexing a new animal drug.

24 ‘‘(c)(1) Any person may submit a request to the Sec25 retary for a determination whether a new animal drug
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1 may be eligible for inclusion in the index. Such a request

2 shall include—

3 ‘‘(A) information regarding the need for the

4 new animal drug, the species for which the new ani5 mal drug is intended, the proposed intended use and

6 conditions of use, and anticipated annual distribu7 tion;

8 ‘‘(B) information to support the conclusion that

9 the proposed use meets the conditions of subsections

10 (a)(1) or (a)(2) of this section;

11 ‘‘(C) information regarding the components and

12 composition of the new animal drug;

13 ‘‘(D) a description of the methods used in, and

14 the facilities and controls used for, the manufacture,

15 processing, and packing of such new animal drug;

16 ‘‘(E) an environmental assessment or informa17 tion to support a categorical exclusion from the re18 quirement to prepare an environmental assessment;

19 ‘‘(F) information sufficient to support the con20 clusion that the proposed use of the new animal

21 drug does not present a threat to the safety of indi22 viduals exposed to the new animal drug through its

23 manufacture or use; and
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1 ‘‘(G) such other information as the Secretary

2 may deem necessary to make this eligibility deter3 mination.

4 ‘‘(2) Within 90 days after the submission of a request

5 for a determination of eligibility for indexing based on

6 paragraph (a)(1) of this section, or 180 days for a request

7 submitted based on paragraph (a)(2) of this section, the

8 Secretary shall grant or deny the request, and notify the

9 person who requested such determination of the Sec10 retary’s decision. The Secretary shall grant the request if

11 the Secretary finds that—

12 ‘‘(A) no new animal drug, including the same

13 active ingredient or any salt or ester thereof is ap14 proved or conditionally approved in the same dosage

15 form for the same intended use;

16 ‘‘(B) the proposed use does not raise concerns

17 related to safety; and

18 ‘‘(C) the person requesting the determination

19 has established appropriate specifications for the

20 manufacture and control of the new animal drug

21 and has demonstrated an understanding of the re22 quirements of current good manufacturing practices.

23 If the Secretary denies the request, the Secretary shall

24 thereafter provide due notice and an opportunity for an

25 informal conference. The decision of the Secretary fol-
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1 lowing an informal conference shall constitute final agency

2 action subject to judicial review.

3 ‘‘(d)(1) With respect to a new animal drug for which

4 the Secretary has made a determination of eligibility

5 under subsection (b), the person who made such a request

6 may ask that the Secretary add the new animal drug to

7 the index established under subsection (a). The request

8 for addition to the index shall include—

9 ‘‘(A) a copy of the Secretary’s determination of

10 eligibility issued under subsection (b);

11 ‘‘(B) a written report that meets the require12 ments in subparagraph (d)(2) of this section;

13 ‘‘(C) a proposed index entry;

14 ‘‘(D) facsimile labeling;

15 ‘‘(E) anticipated annual distribution of the new

16 animal drug;

17 ‘‘(F) a written commitment to manufacture the

18 new animal drug according to current good manu19 facturing practices;

20 ‘‘(G) a written commitment to label, distribute,

21 and promote the new animal drug only in accordance

22 with the index entry;

23 ‘‘(H) upon specific request of the Secretary, in24 formation submitted to the expert panel described in

25 subparagraph (3); and
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1 ‘‘(I) any additional requirements that the Sec2 retary may prescribe by general regulation or spe3 cific order.

4 ‘‘(2) The report required in subparagraph (1) shall:

5 ‘‘(A) be authored by a qualified expert panel;

6 ‘‘(B) include an evaluation of all available tar7 get animal safety and effectiveness information, in8 cluding anecdotal information;

9 ‘‘(C) State the expert panel’s opinion regarding

10 whether the benefits of using the new animal drug

11 for the proposed use in a minor species outweigh its

12 risks, taking into account the harm being caused by

13 the absence of an approved or conditionally-approved

14 new animal drug for the minor species in question;

15 ‘‘(D) include information upon which labeling

16 can be written; and

17 ‘‘(E) include a recommendation regarding

18 whether the new animal drug should be limited to

19 use under the professional supervision of a licensed

20 veterinarian.

21 ‘‘(3) A qualified expert panel, as used in this section,

22 is a panel that—

23 ‘‘(A) is composed of experts qualified by sci24 entific training and experience to evaluate the target
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1 animal safety and effectiveness of the new animal

2 drug under consideration;

3 ‘‘(B) operates external to FDA; and

4 ‘‘(C) is not subject to the Federal Advisory

5 Committee Act, 5 U.S.C. App. 2.

6 The Secretary shall define the criteria for selection of a

7 qualified expert panel and the procedures for the operation

8 of the panel by regulation.

9 ‘‘(4) Within 180 days after the receipt of a request

10 for listing a new animal drug in the index, the Secretary

11 shall grant or deny the request. The Secretary shall grant

12 the request if the request for indexing continues to meet

13 the eligibility criteria in subsection (a) and the Secretary

14 finds, on the basis of the report of the qualified expert

15 panel and other information available to the Secretary,

16 that the benefits of using the new animal drug for the

17 proposed use in a minor species outweigh its risks, taking

18 into account the harm caused by the absence of an ap19 proved or conditionally-approved new animal drug for the

20 minor species in question. If the Secretary denies the re21 quest, the Secretary shall thereafter provide due notice

22 and the opportunity for an informal conference. The deci23 sion of the Secretary following an informal conference

24 shall constitute final agency action subject to judicial re25 view.
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1 ‘‘(e)(1) The index established under subsection (a)

2 shall include the following information for each listed

3 drug—

4 ‘‘(A) the name and address of the person who

5 holds the index listing;

6 ‘‘(B) the name of the drug and the intended

7 use and conditions of use for which it is being in8 dexed;

9 ‘‘(C) product labeling; and

10 ‘‘(D) conditions and any limitations that the

11 Secretary deems necessary regarding use of the

12 drug.

13 ‘‘(2) The Secretary shall publish the index, and revise

14 it periodically.

15 ‘‘(3) The Secretary may establish by regulation a

16 process for reporting changes in the conditions of manu17 facturing or labeling of indexed products.

18 ‘‘(f)(1) If the Secretary finds, after due notice to the

19 person who requested the index listing and an opportunity

20 for an informal conference, that—

21 ‘‘(A) the expert panel failed to meet the re22 quirements as set forth by the Secretary by regula23 tion;

24 ‘‘(B) on the basis of new information before the

25 Secretary, evaluated together with the evidence
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1 available to the Secretary when the new animal drug

2 was listed in the index, the benefits of using the new

3 animal drug for the indexed use do not outweigh its

4 risks;

5 ‘‘(C) the conditions of subsection (c)(2) of this

6 section are no longer satisfied;

7 ‘‘(D) the manufacture of the new animal drug

8 is not in accordance with current good manufac9 turing practices;

10 ‘‘(E) the labeling, distribution, or promotion of

11 the new animal drug is not in accordance with the

12 index entry;

13 ‘‘(F) the conditions and limitations of use asso14 ciated with the index listing have not been followed;

15 or

16 ‘‘(G) the request for indexing contains any un17 true statement of material fact;

18 the Secretary shall remove the new animal drug from the

19 index. The decision of the Secretary following an informal

20 conference shall constitute final agency action subject to

21 judicial review.

22 ‘‘(2) If the Secretary finds that there is a reasonable

23 probability that the use of the drug would adversely affect

24 the health of humans or other animals, the Secretary may:
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1 ‘‘(A) suspend the listing of such drug imme2 diately;

3 ‘‘(B) give the person listed in the index prompt

4 notice of the Secretary’s action; and

5 ‘‘(C) afford that person the opportunity for an

6 informal conference.

7 The decision of the Secretary following an informal con8 ference shall constitute final agency action subject to judi9 cial review.

10 ‘‘(g) For purposes of indexing new animal drugs

11 under this section, to the extent consistent with the public

12 health, the Secretary shall promulgate regulations for ex13 empting from the operation of section 512 minor species

14 new animal drugs and animal feeds bearing or containing

15 new animal drugs intended solely for investigational use

16 by experts qualified by scientific training and experience

17 to investigate the safety and effectiveness of minor species

18 animal drugs. Such regulations may, at the discretion of

19 the Secretary, among other conditions relating to the pro20 tection of the public health, provide for conditioning such

21 exemption upon the establishment and maintenance of

22 such records, and the making of such reports to the Sec23 retary, by the manufacturer or the sponsor of the inves24 tigation of such article, of data (including but not limited

25 to analytical reports by investigators) obtained as a result
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1 of such investigational use of such article, as the Secretary

2 finds will enable the Secretary to evaluate the safety and

3 effectiveness of such article in the event of the filing of

4 a request for an index listing pursuant to this section.

5 ‘‘(h) The labeling of a new animal drug that is the

6 subject of an index listing shall state, prominently and

7 conspicuously—

8 ‘‘(1) NOT APPROVED BY FDA.—Legally mar9 keted as an FDA indexed product. Extra-label use

10 is prohibited.’’;

11 ‘‘(2) except in the case of new animal drugs in12 dexed for use in an early life stage of a food pro13 ducing animal, ‘‘This product is not to be used in

14 animals intended for use as food for humans or

15 other animals.’’; and

16 ‘‘(3) such other information as may be pre17 scribed by the Secretary in the index listing.

18 ‘‘(i)(1) In the case of any new animal drug for which

19 an index listing pursuant to subsection (a) is in effect,

20 the person who has an index listing shall establish and

21 maintain such records, and make such reports to the Sec22 retary, of data relating to experience, and other data or

23 information, received or otherwise obtained by such person

24 with respect to such drug, or with respect to animal feeds

25 bearing or containing such drug, as the Secretary may by
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1 general regulation, or by order with respect to such listing,

2 prescribe on the basis of a finding that such records and

3 reports are necessary in order to enable the Secretary to

4 determine, or facilitate a determination, whether there is

5 or may be ground for invoking subsection (f). Such regula6 tion or order shall provide, where the Secretary deems it

7 to be appropriate, for the examination, upon request, by

8 the persons to whom such regulation or order is applica9 ble, of similar information received or otherwise obtained

10 by the Secretary.

11 ‘‘(2) Every person required under this subsection to

12 maintain records, and every person in charge or custody

13 thereof, shall, upon request of an officer or employee des14 ignated by the Secretary, permit such officer or employee

15 at all reasonable times to have access to and copy and

16 verify such records.

17 ‘‘(j)(1) Safety and effectiveness data and information

18 which has been submitted in support of a request for a

19 new animal drug to be indexed under this section and

20 which has not been previously disclosed to the public shall

21 be made available to the public, upon request, unless ex22 traordinary circumstances are shown—

23 ‘‘(A) if no work is being or will be undertaken

24 to have the drug indexed in accordance with the re25 quest,
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1 ‘‘(B) if the Secretary has determined that such

2 drug cannot be indexed and all legal appeals have

3 been exhausted,

4 ‘‘(C) if the indexing of such drug is terminated

5 and all legal appeals have been exhausted, or

6 ‘‘(D) if the Secretary has determined that such

7 drug is not a new animal drug.

8 ‘‘(2) Any request for data and information pursuant

9 to paragraph (1) shall include a verified statement by the

10 person making the request that any data or information

11 received under such paragraph shall not be disclosed by

12 such person to any other person—

13 ‘‘(A) for the purpose of, or as part of a plan,

14 scheme, or device for, obtaining the right to make,

15 use, or market, or making, using, or marketing, out16 side the United States, the drug identified in the re17 quest for indexing; and

18 ‘‘(B) without obtaining from any person to

19 whom the data and information are disclosed an

20 identical verified statement, a copy of which is to be

21 provided by such person to the Secretary, which

22 meets the requirements of this paragraph.

23 ‘‘SEC. 573. DESIGNATED NEW ANIMAL DRUGS FOR MINOR

24 USE OR MINOR SPECIES.

25 ‘‘(a) DESIGNATION.—
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1 ‘‘(1) The manufacturer or the sponsor of a new

2 animal drug for a minor use or use in a minor spe3 cies may request that the Secretary declare that

4 drug a ‘designated new animal drug’. A request for

5 designation of a new animal drug shall be made be6 fore the submission of an application under section

7 512(b) or section 571 for the new animal drug.

8 ‘‘(2) The Secretary may declare a new animal

9 drug a ‘designated new animal drug’ for an intended

10 use if—

11 ‘‘(A) it is intended for a minor use or use

12 in a minor species; and

13 ‘‘(B) a new animal drug containing the

14 same active ingredient, including any salt or

15 ester of the active ingredient, for the same in16 tended use, in the same species, and in the

17 same dosage form is not approved under section

18 512 or section 571 or designated for the in19 tended use at the time the request is made.

20 ‘‘(3) Regarding the termination of a

21 designation—

22 ‘‘(A) the sponsor of a new animal drug

23 shall notify the Secretary of any decision to dis24 continue active pursuit of approval under sec25 tions 512 or 571 of an application for a des-
27

•S 1346 IS

1 ignated new animal drug. The Secretary shall

2 terminate the designation upon such notifica3 tion;

4 ‘‘(B) the Secretary may also terminate des5 ignation if the Secretary independently deter6 mines that the sponsor is not actively pursuing

7 approval under sections 512 or 571 with due

8 diligence;

9 ‘‘(C) the sponsor of an approved des10 ignated new animal drug shall notify the Sec11 retary of any discontinuance of the manufac12 ture of such new animal drug at least one year

13 before discontinuance. The Secretary shall ter14 minate the designation upon such notification;

15 and

16 ‘‘(D) the designation shall terminate upon

17 the expiration of any applicable exclusivity pe18 riod under subsection (c).

19 ‘‘(4) Notice respecting the designation or termi20 nation of designation of a new animal drug shall be

21 made available to the public.

22 ‘‘(b) GRANTS AND CONTRACTS FOR DEVELOPMENT

23 OF DESIGNATED NEW ANIMAL DRUGS.—

24 ‘‘(1) The Secretary may make grants to and

25 enter into contracts with public and private entities
28

•S 1346 IS

1 and individuals to assist in defraying the costs of

2 qualified safety and effectiveness testing expenses

3 and manufacturing expenses incurred in connection

4 with the development of designated new animal

5 drugs.

6 ‘‘(2) For purposes of subsection (1) of this

7 section—

8 ‘‘(A) The term ‘‘qualified safety and effec9 tiveness testing’’ means testing—

10 ‘‘(i) which occurs after the date such

11 new animal drug is designated under this

12 section and before the date on which an

13 application with respect to such drug is

14 submitted under section 512 or 571; and

15 ‘‘(ii) which is carried out under an in16 vestigational exemption under section

17 512(j).

18 ‘‘(B) The term ‘‘manufacturing expenses’’

19 means expenses incurred in developing proc20 esses and procedures associated with manufac21 ture of the designated new animal drug which

22 occur after the new animal drug is designated

23 under this section and before the date on which

24 an application with respect to such new animal
29

•S 1346 IS

1 drug is submitted under section 512 or section

2 571.

3 ‘‘(3) There is authorized to be appropriated to

4 carry out this subsection $1,000,000 for the fiscal

5 year following publication of final implementing reg6 ulations, $2,000,000 for the subsequent fiscal year

7 and such sums as may be necessary for each fiscal

8 year thereafter.

9 ‘‘(c) EXCLUSIVITY FOR DESIGNATED NEW ANIMAL

10 DRUGS.—

11 ‘‘(1) Except as provided in subsection (c)(2), if

12 the Secretary—

13 ‘‘(A) approves or conditionally approves an

14 application for a designated new animal drug,

15 and no active ingredient (including any salt or

16 ester of the active ingredient) of that des17 ignated new animal drug has been approved or

18 conditionally approved previously, the Secretary

19 may not approve or conditionally approve an20 other application submitted for a new animal

21 drug with the same active ingredient and in22 tended use as the designated new animal drug

23 for another applicant before the expiration of

24 ten years from the date of the approval or con25 ditional approval of the application.
30

•S 1346 IS

1 ‘‘(B) approves or conditionally approves an

2 application for a designated new animal drug,

3 and an active ingredient (including an ester or

4 salt of the active ingredient) of that designated

5 new animal drug has been approved or condi6 tionally approved previously, the Secretary may

7 not approve or conditionally approve another

8 application submitted for a new animal drug

9 with the same active ingredient and intended

10 use as the designated new animal drug for an11 other applicant before the expiration of seven

12 years from the date of approval or conditional

13 approval of the application.

14 ‘‘(2) If an application filed pursuant to section

15 512 or section 571 is approved for a designated new

16 animal drug, the Secretary may, during the 10-year

17 or 7-year exclusivity period beginning on the date of

18 the application approval or conditional approval, ap19 prove or conditionally approve another application

20 under section 512 or section 571 for such drug for

21 such minor use or minor species for another appli22 cant if—

23 ‘‘(A) the Secretary finds, after providing

24 the holder of such an approved application no25 tice and opportunity for the submission of
31

•S 1346 IS

1 views, that in the granted exclusivity period the

2 holder of the approved application cannot as3 sure the availability of sufficient quantities of

4 the drug to meet the needs for which the drug

5 was designated; or

6 ‘‘(B) such holder provides written consent

7 to the Secretary for the approval or conditional

8 approval of other applications before the expira9 tion of such exclusivity period.’’.

10 (e) CONFORMING AMENDMENTS.—

11 (1) Section 201(u) of the Federal Food, Drug,

12 and Cosmetic Act is amended by striking ‘‘512’’ and

13 inserting ‘‘512, 571’’.

14 (2) Section 201(v) of the Federal Food, Drug,

15 and Cosmetic Act is amended by inserting the fol16 lowing after paragraph (2): ‘‘Provided that any drug

17 intended for minor use or use in a minor species

18 that is not the subject of a final regulation published

19 by the Secretary through notice and comment rule20 making finding that the criteria of paragraphs (1)

21 and (2) or of section 108 of Public Law 90–399

22 have been met is a new animal drug.’’

23 (3) Section 301(e) of the Federal Food, Drug,

24 and Cosmetic Act is amended by striking
32

•S 1346 IS

1 ‘‘512(a)(4)(C), 512(j), (l) or (m)’’ and inserting

2 ‘‘512(a)(4)(C), 512(j), (l) or (m), 572(i).’’

3 (4) Section 301(j) of the Federal Food, Drug,

4 and Cosmetic Act is amended by deleting ‘‘520’’ and

5 inserting ‘‘520, 571, 572, 573.’’

6 (5) Section 502 of the Federal Food, Drug, and

7 Cosmetic Act is amended by adding at the end the

8 following new subsection:

9 ‘‘(u) If it is a new animal drug—

10 ‘‘(1) that is conditionally approved under sec11 tion 571 and its labeling does not conform with the

12 approved application or section 571(f), or that is not

13 conditionally approved under section 571 and its

14 label bears the statement set forth in section

15 571(f)(1)(A); or

16 ‘‘(2) that is indexed under section 572 and its

17 labeling does not conform with the index listing

18 under section 572(e) or 572(h), or that has not been

19 indexed under section 572 and its label bears the

20 statement set forth in section 572(h).’’.

21 (6) Section 503(f) of the Federal Food, Drug,

22 and Cosmetic Act is amended by—

23 (A) in paragraph (1)(A)(ii) by striking

24 ‘‘512’’ and inserting ‘‘512, a conditionally-ap-
33

•S 1346 IS

1 proved application under section 571, or an

2 index listing under section 572’’; and

3 (B) in paragraph (3) by striking ‘‘section

4 512’’ and inserting ‘‘sections 512, 571, or

5 572’’.

6 (7) Section 504(a)(1) of the Federal Food,

7 Drug, and Cosmetic Act is amended by striking

8 ‘‘512(b)’’ and inserting ‘‘512(b), a conditionally-ap9 proved application filed pursuant to section 571, or

10 an index listing pursuant to section 572’’.

11 (8) Sections 504(a)(2)(B) and 504(b) of the

12 Federal Food, Drug, and Cosmetic Act are amended

13 by striking ‘‘512(i)’’ each place it appears and in14 serting ‘‘512(i), or the index listing pursuant to sec15 tion 572(e)’’.

16 (9) Section 512(a) of the Federal Food, Drug,

17 and Cosmetic Act is amended by striking paragraphs

18 (1) and (2) and inserting the following:

19 ‘‘(1) A new animal drug shall, with respect to any

20 particular use or intended use of such drug, be deemed

21 unsafe for purposes of section 501(a)(5) and section

22 402(a)(2)(C)(ii) unless—

23 ‘‘(A) there is in effect an approval of an appli24 cation filed pursuant to subsection (b) with respect

25 to such use or intended use of such drug, and such
34

•S 1346 IS

1 drug, its labeling, and such use conform to such ap2 proved application;

3 ‘‘(B) there is in effect a conditional approval of

4 an application filed pursuant to section 571 with re5 spect to such use or intended use of such drug, and

6 such drug, its labeling, and such use conform to

7 such conditionally-approved application; or

8 ‘‘(C) there is in effect an index listing pursuant

9 to section 572 with respect to such use or intended

10 use of such drug in a minor species, and such drug,

11 its labeling, and such use conform to such index list12 ing.’’

13 A new animal drug shall also be deemed unsafe for such

14 purposes in the event of removal from the establishment

15 of a manufacturer, packer, or distributor of such drug for

16 use in the manufacture of animal feed in any State unless

17 at the time of such removal such manufacturer, packer,

18 or distributor has an unrevoked written statement from

19 the consignee of such drug, or notice from the Secretary,

20 to the effect that, with respect to the use of such drug

21 in animal feed, such consignee (i) holds a license issued

22 under subsection (m) and has in its possession current ap23 proved labeling for such drug in animal feed; or (ii) will,

24 if the consignee is not a user of the drug, ship such drug

25 only to a holder of a license issued under subsection (m).
35

•S 1346 IS

1 ‘‘(2) An animal feed bearing or containing a new ani2 mal drug shall, with respect to any particular use or in3 tended use of such animal feed be deemed unsafe for pur4 poses of section 501(a)(6) unless—

5 ‘‘(A) there is in effect—

6 ‘‘(i) an approval of an application filed

7 pursuant to subsection (b) with respect to such

8 drug, as used in such animal feed, and such

9 animal feed and its labeling, distribution, hold10 ing, and use conform to such approved applica11 tion;

12 ‘‘(ii) a conditional approval of an applica13 tion filed pursuant to section 571 with respect

14 to such drug, as used in such animal feed, and

15 such animal feed and its labeling, distribution,

16 holding, and use conform to such conditionally17 approved application; or

18 ‘‘(iii) an index listing pursuant to section

19 572 with respect to such drug, as used in such

20 animal feed, and such animal feed and its label21 ing, distribution, holding, and use conform to

22 such index listing; and

23 ‘‘(B) such animal feed is manufactured at a site

24 for which there is in effect a license issued pursuant
36

•S 1346 IS

1 to subsection (m)(1) to manufacture such animal

2 feed.’’.

3 (10) Section 512(b)(3) of the Federal Food,

4 Drug, and Cosmetic Act is amended by striking

5 ‘‘under paragraph (1) or a request for an investiga6 tional exemption under subsection (j)’’ and inserting

7 ‘‘under paragraph (1), section 571, or a request for

8 an investigational exemption under subsection (j)’’.

9 (11) Section 512(d)(4) of the Federal Food,

10 Drug, and Cosmetic Act is amended by striking

11 ‘‘have previously been separately approved’’ and in12 serting ‘‘have previously been separately approved

13 pursuant to an application submitted under section

14 512(b)(1)’’.

15 (12) Section 512(f) of the Federal Food, Drug,

16 and Cosmetic Act is amended by striking ‘‘sub17 section (d), (e), or (m)’’ and inserting ‘‘subsection

18 (d), (e), or (m), or section 571(c), (d), or (e)’’.

19 (13) Section 512(g) of the Federal Food, Drug,

20 and Cosmetic Act is amended by striking ‘‘this sec21 tion’’ and inserting ‘‘this section, or section 571’’.

22 (14) Section 512(i) of the Federal Food, Drug,

23 and Cosmetic Act is amended by striking ‘‘sub24 section (b)’’ and inserting ‘‘subsection (b) or section

25 571’’ and by inserting ‘‘or upon failure to renew a
37

•S 1346 IS

1 conditional approval under section 571’’ after ‘‘or

2 upon its suspension’’.

3 (15) Section 512(l)(1) of the Federal Food,

4 Drug, and Cosmetic Act is amended by striking

5 ‘‘subsection (b)’’ and inserting ‘‘subsection (b) or

6 section 571’’.

7 (16) Section 512(m)(1)(C) of the Federal Food,

8 Drug, and Cosmetic Act is amended by striking ‘‘ap9 plicable regulations published pursuant to subsection

10 (i)’’ and inserting ‘‘applicable regulations published

11 pursuant to subsection (i) or for indexed new animal

12 drugs in accordance with the index listing published

13 pursuant to section 572(e)(2) and the labeling re14 quirements set forth in section 572(h)’’.

15 (17) Section 512(m)(3) of the Federal Food,

16 Drug, and Cosmetic Act is amended by inserting ‘‘or

17 an index listing pursuant to section 572(e)’’ after

18 ‘‘subsection (i)’’.

19 (18) Section 512(p)(1) of the Federal Food,

20 Drug, and Cosmetic Act is amended by striking

21 ‘‘subsection (b)(1)’’ and inserting ‘‘subsection (b)(1)

22 or section 571(a)’’.

23 (19) Section 512(p)(2) of the Federal Food,

24 Drug, and Cosmetic Act is amended by striking
38

•S 1346 IS

1 ‘‘subsection (b)(1)’’ and inserting ‘‘subsection (b)(1)

2 or section 571(a)’’.

3 SEC. 4. INTERNAL REVENUE CODE AMENDMENTS.

4 (a) The Internal Revenue Code of 1986 is amended

5 by adding the following new section after section 45C:

6 ‘‘SEC. 45D. SAFETY AND EFFECTIVENESS TESTING EX7 PENSES FOR DESIGNATED NEW ANIMAL

8 DRUGS FOR MINOR USES AND MINOR SPE9 CIES.

10 ‘‘(a) For purposes of section 38, the credit deter11 mined under this section for the taxable year is an amount

12 equal to 50 percent of the qualified safety and effective13 ness testing expenses for the designated new animal drug

14 for the taxable year.

15 ‘‘(b) For purposes of this section—

16 ‘‘(1) Qualified safety and effectiveness testing

17 expenses—

18 ‘‘(A) Except as otherwise provided in this

19 paragraph, the term ‘qualified safety and effec20 tiveness testing expenses’ means the amounts

21 which are paid or incurred by the taxpayer dur22 ing the taxable year which would be described

23 in subsection (b) of section 41 if such sub24 section were applied with the modifications set

25 forth in subparagraph (B).
39

•S 1346 IS

1 ‘‘(B) For purposes of subparagraph (A),

2 subsection (b) of section 41 shall be applied—

3 ‘‘(i) by substituting ‘safety and effec4 tiveness testing’ for ‘qualified research’

5 each place it appears in paragraphs (2)

6 and (3) of such subsection; and

7 ‘‘(ii) by substituting ‘100 percent’ for

8 ‘65 percent’ in paragraph (3)(A) of such

9 subsection.

10 ‘‘(C) The term ‘qualified safety and effec11 tiveness testing expenses’ shall not include any

12 amount to the extent such amount is funded by

13 any grant, contract, or otherwise by another

14 person (or any governmental entity).

15 ‘‘(D) For purposes of this paragraph—

16 ‘‘(i) section 41 shall be deemed to re17 main in effect for periods after June 30,

18 2001; and

19 ‘‘(ii) the ‘trade or business of the tax20 payer’ requirement of section 41(b)(1)

21 shall be deemed to be satisfied in the case

22 of a taxpayer that owns animals that are

23 the subject of safety and effectiveness test24 ing.
40

•S 1346 IS

1 ‘‘(2)(A) The term ‘safety and effectiveness test2 ing’ means any safety and effectiveness testing—

3 ‘‘(i) which is carried out under an exemp4 tion for a new animal drug being tested for

5 minor use or a minor species under section

6 512(j) of the Federal Food, Drug, and Cos7 metic Act (or regulations issued under such sec8 tion);

9 ‘‘(ii) which occurs—

10 ‘‘(I) after the date such new animal

11 drug request is filed for designation under

12 section 573 of such Act, and

13 ‘‘(II) before the date on which an ap14 plication with respect to such drug is ap15 proved under section 512(c) of such Act;

16 and

17 ‘‘(iii) which is conducted by or on behalf

18 of—

19 ‘‘(I) the taxpayer who applied for the

20 designation under section 573; or

21 ‘‘(II) the owner of the animals that

22 are the subject of safety and effectiveness

23 testing.

24 ‘‘(B) Safety and effectiveness testing shall be

25 taken into account under subparagraph (A) only to
41

•S 1346 IS

1 the extent such testing is related to the use of a

2 new animal drug for the minor use or minor species

3 for which it was designated under section 573 of the

4 Federal Food, Drug, and Cosmetic Act.

5 ‘‘(c)(1) Except as provided in paragraph (2), any

6 qualified safety and effectiveness testing expenses for a

7 taxable year to which an election under this section applies

8 shall not be taken into account for purposes of deter9 mining the credit allowable under section 41 for such tax10 able year.

11 ‘‘(2) Any qualified safety and effectiveness testing ex12 penses for any taxable year which are qualified research

13 expenses (within the meaning of section 41(b)) shall be

14 taken into account in determining base period research ex15 penses for purposes of applying section 41 to subsequent

16 taxable years.

17 ‘‘(d)(1) For purposes of this section, the term ‘minor

18 use’ is defined in section 201(mm) of the Federal Food,

19 Drug, and Cosmetic Act and ‘minor species’ is defined in

20 section 201(ll). Determinations under the preceding sen21 tence with respect to any new animal drug shall be made

22 on the basis of the facts and circumstances as of the date

23 such new animal drug is designated under section 573 of

24 the Federal Food, Drug, and Cosmetic Act.
42

•S 1346 IS

1 ‘‘(2) No credit shall be allowed under this section

2 with respect to any safety and effectiveness testing con3 ducted by a corporation to which an election under section

4 936 applies.

5 ‘‘(3) Rules similar to the rules of paragraphs (1) and

6 (2) of section 41(f) shall apply for purposes of this section.

7 ‘‘(4) This section shall apply to any taxpayer for any

8 taxable year only if such taxpayer elects (at such time and

9 in such manner as the Secretary may by regulations pre10 scribe) to have this section apply for such taxable year.’’.

11 (b) CONFORMING AMENDMENTS.—

12 (1) Section 38(b) of the Internal Revenue Code

13 is amended—

14 (A) By deleting ‘‘plus’’ at end of para15 graph (11);

16 (B) By deleting the period at the end of

17 paragraph (12) and replacing it with the fol18 lowing: ‘‘, plus’’; and

19 (C) By adding the following new para20 graph at the end: ‘‘the minor use and minor

21 species new animal drug credit determined

22 under section 45D(a)’’.

23 (2) Section 280C(b) of the Internal Revenue

24 Code is amended—
43

•S 1346 IS

1 (A) in paragraph (1), by deleting ‘‘section

2 45C(b)’’ and substituting the following: ‘‘section

3 45C(b) or 45D(b)’’; and

4 (B) in paragraphs (1) and (2), by deleting

5 ‘‘section 45C’’ wherever it appears and sub6 stituting the following: ‘‘section 45C or 45D’’.

7 (c) REGULATIONS.—The Secretary of the Treasury

8 shall publish proposed regulations to implement amend9 ments to the Internal Revenue Code made by this Act

10 within 6 months of the date of enactment, and final regu11 lations within 24 months of the date of enactment.

12 SEC. 5. REGULATIONS.

13 Not later than 18 months after the date of enactment

14 of this Act, the Secretary of Health and Human Services

15 shall issue proposed regulations to implement section 572

16 of the Federal Food, Drug, and Cosmetic Act (as added

17 by this Act), and not later than 36 months after the date

18 of enactment of this Act, the Secretary shall issue final

19 regulations implementing such amendments. Not later

20 than 12 months after the date of enactment of this Act,

21 the Secretary of Health and Human Services shall issue

22 proposed regulations to implement section 573 of the Fed23 eral Food, Drug, and Cosmetic Act (as added by this Act),

24 and not later than 24 months after the date of enactment

25 of this Act, the Secretary shall issue final regulations im-
44

•S 1346 IS

1 plementing such amendments; provided that these time2 frames shall be extended by 12 months for each fiscal year

3 in which the funds authorized to be appropriated by this

4 Act are not in fact appropriated. The Secretary shall im5 plement section 571 of the Federal Food, Drug, and Cos6 metic Act (as added by this Act) on the date of enactment

7 of this Act and subsequently publish any needed imple8 menting regulations.

9 SEC. 6. OFFICE OF MINOR USE AND MINOR SPECIES ANI10 MAL DRUG DEVELOPMENT.

11 The Secretary of Health and Human Services shall

12 establish within the Center of Veterinary Medicine (of the

13 Food and Drug Administration), an Office of Minor Use

14 and Minor Species Animal Drug Development that reports

15 directly to the Director of the Center for Veterinary Medi16 cine. This office shall be responsible for overseeing the de17 velopment and legal marketing of new animal drugs for

18 minor uses and minor species. There is authorized to be

19 appropriated to carry out this subsection $1,200,000 for

20 fiscal year 2002 and such sums as may be necessary for

21 each fiscal year thereafter.

Æ