II 

118TH CONGRESS 

1ST SESSION S. 3398 

To amend the Public Health Service Act to establish an Office of Drug 

Manufacturing. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 5, 2023 

Ms. WARREN (for herself and Mr. MERKLEY) introduced the following bill; 

which was read twice and referred to the Committee on Health, Education, Labor, and Pensions 

A BILL 

To amend the Public Health Service Act to establish an 

Office of Drug Manufacturing. 

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 ‘‘Affordable Drug Man5 ufacturing Act of 2023’’. 

6 SEC. 2. PUBLIC MANUFACTURING OF PHARMACEUTICALS. 

7 Part A of title III of the Public Health Service Act 

8 (42 U.S.C. 241 et seq.) is amended by adding at the end 

9 the following: 


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1 ‘‘SEC. 310C. MANUFACTURING OF DRUGS. 

2 ‘‘(a) ESTABLISHMENT OF OFFICE OF DRUG MANU3 FACTURING.— 

4 ‘‘(1) IN GENERAL.—There is established within 

5 the Department of Health and Human Services an 

6 office to be known as the Office of Drug Manufac7 turing (referred to in this section as the ‘Office’). 

8 ‘‘(2) PURPOSE.—The purpose of the Office is— 

9 ‘‘(A) to increase competition, lower prices, 

10 and address shortages in the market for pre11 scription drugs, including insulin, asthma and 

12 chronic obstructive pulmonary disease (COPD) 

13 inhalers, naloxone, epinephrine auto-injectors, 

14 and antibiotics; 

15 ‘‘(B) to reduce the cost of prescription 

16 drugs to Federal and State health programs, 

17 taxpayers, and consumers; and 

18 ‘‘(C) to increase patient access to afford19 able drugs and associated devices. 

20 ‘‘(3) PERSONNEL.— 

21 ‘‘(A) DIRECTOR.— 

22 ‘‘(i) IN GENERAL.—The Office shall 

23 be headed by a Director, who shall be ap24 pointed by the President. 


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1 ‘‘(ii) COMPENSATION.—The Director 

2 shall be compensated at the rate prescribed 

3 for level III of the Executive Schedule. 

4 ‘‘(B) EMPLOYEES.—The Director of the 

5 Office, in consultation with the Secretary, may 

6 fix the number of, and appoint and direct, all 

7 employees of the Office. 

8 ‘‘(C) BANNED INDIVIDUALS.— 

9 ‘‘(i) DRUG COMPANY LOBBYISTS.—No 

10 former registered drug industry lobbyist— 

11 ‘‘(I) may be appointed to the po12 sition of Director of the Office; or 

13 ‘‘(II) may be employed by the Of14 fice during the 6-year period begin15 ning on the date on which the reg16 istered lobbyist terminates its reg17 istration in accordance with section 

18 4(d) of the Lobbying Disclosure Act 

19 of 1995 (2 U.S.C. 1603(d)) or the 

20 agent terminates its status, as appli21 cable. 

22 ‘‘(ii) SENIOR EXECUTIVES OF LAW23 BREAKING COMPANIES.—No former senior 

24 executive of a covered entity (as defined in 

25 clause (iii)) who was employed by such enVerDate Sep 11 2014 05:15 Dec 13, 2023 Jkt 049200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3398.IS S3398

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1 tity on any date on which wrongful con2 duct is the subject of a settlement, decree 

3 or enforcement action described in clause 

4 (iii)(III) occurred— 

5 ‘‘(I) may be appointed to the po6 sition of Director of the Office; or 

7 ‘‘(II) may be employed by the Of8 fice during the 6-year period begin9 ning on the later of— 

10 ‘‘(aa) the date of the settle11 ment; and 

12 ‘‘(bb) the date on which the 

13 enforcement action has con14 cluded. 

15 ‘‘(iii) COVERED ENTITY.—The term 

16 ‘covered entity’ means any entity that is 

17 currently— 

18 ‘‘(I) a drug manufacturer; 

19 ‘‘(II) a wholesaler; and 

20 ‘‘(III)(aa) operating under Fed21 eral settlement, including a Federal 

22 consent decree; or 

23 ‘‘(bb) the subject of an enforce24 ment action in a court of the United 

25 States or by an agency. 


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1 ‘‘(4) DUTIES.— 

2 ‘‘(A) IN GENERAL.—The Office shall— 

3 ‘‘(i) prepare and submit applications 

4 for approval to the Food and Drug Admin5 istration, or enter into contracts for such 

6 submission, for the manufacture of appli7 cable drugs when authorized under this 

8 section, and in accordance with subpara9 graph (G); 

10 ‘‘(ii) acquire rights to manufacture 

11 applicable drugs as authorized under this 

12 section; 

13 ‘‘(iii) manufacture, or enter into con14 tracts with entities, with preference for 

15 nonprofit entities and public partners, to 

16 manufacture, applicable drugs as author17 ized under this section; 

18 ‘‘(iv) determine a fair price for each 

19 applicable drug, in accordance with sub20 paragraph (B); 

21 ‘‘(v) sell manufactured applicable 

22 drugs at a fair price as authorized under 

23 this section; and 

24 ‘‘(vi) manufacture, or enter into con25 tracts with entities, with preference for 


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1 nonprofit entities and public partners, to 

2 manufacture active pharmaceutical ingredi3 ents for use by the Office or for sale to 

4 other entities. 

5 ‘‘(B) TRANSPARENCY.—All prices paid and 

6 charged for applicable drugs and their inputs 

7 shall be made publicly available by the Office. 

8 ‘‘(C) FAIR PRICE.—In determining a fair 

9 price (the price at which the Office sells an ap10 plicable drug to a wholesaler or direct pur11 chaser) for an applicable drug under subpara12 graph (A)(iv) the Office shall consider— 

13 ‘‘(i) the impact of price on patient ac14 cess to the applicable drug; 

15 ‘‘(ii) the cost of the applicable drug to 

16 Federal or State health care programs; 

17 ‘‘(iii) the cost to the Federal Govern18 ment of manufacturing the applicable 

19 drug; 

20 ‘‘(iv) the administrative costs of oper21 ating the Office; 

22 ‘‘(v) the cost to acquire or manufac23 ture applicable drugs under this section; 

24 ‘‘(vi) the impact of price on market 

25 competition for the applicable drug; 


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1 ‘‘(vii) the impact of formulary design 

2 on patient access to the applicable drug; 

3 and 

4 ‘‘(viii) the cost to acquire the applica5 ble drug at the National Average Drug Ac6 quisition Cost. 

7 ‘‘(D) ACQUIRING RIGHT TO MANUFACTURE

8 AND MARKET.—The Office may acquire the 

9 rights to manufacture and market applicable 

10 drugs as authorized under this section. 

11 ‘‘(E) ACTIVE PHARMACEUTICAL INGREDI12 ENTS.— 

13 ‘‘(i) IN GENERAL.—The Office shall 

14 manufacture, or enter into contracts with 

15 entities to manufacture, an active pharma16 ceutical ingredient if— 

17 ‘‘(I) the Office determines that 

18 such ingredient is not readily available 

19 from existing suppliers; 

20 ‘‘(II) such ingredient is supplied 

21 by a single manufacturing facility; 

22 ‘‘(III) such ingredient is nec23 essary for the manufacture of medical 

24 countermeasures or medicines deemed 


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1 essential from a public health perspec2 tive; 

3 ‘‘(IV) the manufacture of such 

4 ingredient would improve the ability 

5 of other entities to enter the market 

6 for the manufacture of applicable 

7 drugs or otherwise expand the manu8 facture of applicable drugs; or 

9 ‘‘(V) the manufacture of such in10 gredient is necessary for, or would im11 prove the ability of, the Office to 

12 carry out its duties under this section. 

13 ‘‘(ii) PRICE DETERMINATIONS.—In 

14 determining what price at which to sell an 

15 active pharmaceutical ingredient under 

16 clause (i), the Office shall consider the cost 

17 to manufacture the ingredient, the admin18 istrative costs of the Office with respect to 

19 the ingredient, and the impact of such 

20 price on market competition for the ingre21 dient. 

22 ‘‘(F) PURCHASE REQUIREMENTS.—Not23 withstanding applicable laws relating to the 

24 procurement of prescription drugs, the Office 

25 shall establish minimum purchase requirements 


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1 for the Department of Veterans Affairs, the De2 partment of Defense, the Public Health Service, 

3 and the Coast Guard to purchase drugs manu4 factured by or as a result of the Office. 

5 ‘‘(G) LIMITATION ON UNDUE INFLU6 ENCE.—The Food and Drug Administration 

7 shall consider an application submitted by the 

8 Office under subparagraph (A)(i) in the same 

9 manner in which the Administration considers 

10 applications submitted by other manufacturers. 

11 Nothing in this paragraph shall be construed to 

12 require the Food and Drug Administration to 

13 give special deference to any determination 

14 made, or application submitted, by the Office. 

15 ‘‘(5) PRIORITY MANUFACTURING.—The Office 

16 shall prioritize the manufacturing of those applicable 

17 drugs that would have the greatest impact on— 

18 ‘‘(A) lowering drug costs to patients; 

19 ‘‘(B) increasing competition and address20 ing drug shortages in the pharmaceutical mar21 ket; 

22 ‘‘(C) improving public health; 

23 ‘‘(D) addressing health disparities; 

24 ‘‘(E) reducing the cost of prescription 

25 drugs to Federal and State health programs; or 


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1 ‘‘(F) addressing public health emergencies 

2 as defined in this Act, the National Emer3 gencies Act, and the Robert T. Stafford Dis4 aster Relief and Emergency Assistance Act, in 

5 coordination with the Biomedical Advanced Re6 search and Development Authority, the Admin7 istration for Strategic Preparedness and Re8 sponse, the Centers for Disease Control and 

9 Prevention, and any other Federal agency that 

10 the Office determines necessary, to enable effi11 cient procurement, including contracting, for 

12 the Federal emergency response. 

13 ‘‘(6) MANUFACTURING LEVELS.—Not later 

14 than 1 year after the date of enactment of this sec15 tion, the Office shall manufacture, or enter into con16 tracts with entities for the manufacture of, not less 

17 than 15 applicable drugs. Not later than 3 years 

18 after such date of enactment, the Office shall manu19 facture, or enter into contracts with entities for the 

20 manufacture of, not less than 25 applicable drugs. 

21 ‘‘(7) REPORTS TO CONGRESS.—The Director 

22 shall prepare and submit to the President, the Com23 mittee on Health, Education, Labor, and Pensions 

24 of the Senate, and the Committee on Energy and 


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1 Commerce of the House of Representatives, an an2 nual report that includes— 

3 ‘‘(A) an assessment of the major problems 

4 faced by patients in accessing affordable appli5 cable drugs; 

6 ‘‘(B) a description of the status of all 

7 medications for which manufacturing has been 

8 authorized under this section, including medica9 tions being manufactured, medications for 

10 which the Office has submitted an application 

11 to the Food and Drug Administration but has 

12 not yet received approval, and medications for 

13 which the Office has received approval from the 

14 Food and Drug Administration but are not 

15 being manufactured; 

16 ‘‘(C) in the case of antibiotics manufac17 tured under this section, an assessment from 

18 the Centers for Disease Control and Prevention 

19 and the Food and Drug Administration on the 

20 impact of the manufacturing of antibiotics on 

21 antimicrobial resistance; 

22 ‘‘(D) an accounting of funds received from 

23 the sale of all medications for which manufac24 turing has been authorized under this section 

25 and the use of such funds; 


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1 ‘‘(E) an analysis of how the public manu2 facture of drugs meeting the conditions de3 scribed in paragraph (5) would impact, or has 

4 already impacted, competition, access to such 

5 drugs, the costs of such drugs, the costs of pre6 scription drugs to Federal and State health pro7 grams, and public health; and 

8 ‘‘(F) a description of the challenges faced 

9 by the Office in carrying out its duties under 

10 paragraph (4). 

11 ‘‘(b) SUBMISSION OF APPLICATIONS.—For each ap12 plicable drug that the Office determines should be manu13 factured, as provided for under this section, the Office 

14 shall— 

15 ‘‘(1) submit an application under section 

16 505(b)(2), 505(j), or 515 of the Federal Food, 

17 Drug, and Cosmetic Act or section 351(a) or 351(k) 

18 of this Act or submit a notification under section 

19 510(k) of the Federal Food, Drug, and Cosmetic 

20 Act (or enter into a contract with another entity to 

21 submit such an application); 

22 ‘‘(2) request an emergency use authorization of 

23 the product, as appropriate, under section 564 of the 

24 Federal Food, Drug, and Cosmetic Act (or enter 


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1 into a contract with another entity to submit an ap2 plication for such use); or 

3 ‘‘(3) acquire from the holder of an application 

4 approved under subsection (c) or (j) of section 505 

5 or section 515 of the Federal Food, Drug, and Cos6 metic Act or section 351 of this Act, or cleared 

7 under section 510(k) of the Federal Food, Drug, 

8 and Cosmetic Act, rights to manufacture such appli9 cable drug. 

10 ‘‘(c) USE.— 

11 ‘‘(1) IN GENERAL.—The Office shall sell a drug 

12 produced under this section at a fair price to other 

13 entities. Amounts received by the Office from the 

14 sale of such drugs shall be used for the activities of 

15 the Office. 

16 ‘‘(2) SALE OF APPROVED APPLICATION.— 

17 ‘‘(A) AVAILABILITY.— 

18 ‘‘(i) IN GENERAL.—For any applicable 

19 drug that the Office is manufacturing, the 

20 Office shall, beginning 3 years after the 

21 date on which the Office first undertakes 

22 manufacturing of such drug and annually 

23 thereafter, make available for sale, to any 

24 person who commits to manufacturing and 


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1 marketing the applicable drug, the ap2 proved application for the drug. 

3 ‘‘(ii) CONTINUED COMPLIANCE WITH

4 FDA REQUIREMENTS.—The Office shall en5 sure that any application purchased under 

6 clause (i) is consistent with existing stand7 ards applied by the Food and Drug Ad8 ministration related to the transfer of own9 ership rights for an approved application, 

10 including any additional filing require11 ments that the purchaser would need to be 

12 in compliance with due to material changes 

13 in information provided in the approved 

14 application. 

15 ‘‘(B) FAILURE TO USE.—If the Office 

16 makes a determination that a person pur17 chasing an approved application under subpara18 graph (A)— 

19 ‘‘(i) fails to market the applicable 

20 drug within 6 months of the date of such 

21 purchase; or 

22 ‘‘(ii) increases the average manufac23 turer price for the applicable drug above 

24 the fair price (increased by the consumer 

25 price index for all urban consumers (as 


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1 published by the Bureau of Labor Statis2 tics) for that year), 

3 the Office shall revoke the purchaser’s approved 

4 application and resume production of the appli5 cable drug. The Office may waive the applica6 tion of this subparagraph in the case of a Na7 tional Emergency or in any other case deter8 mined appropriate by the Office. 

9 ‘‘(d) ENSURING PATIENT ACCESS.— 

10 ‘‘(1) IN GENERAL.—The Office shall carry out 

11 appropriate activities to ensure the distribution and 

12 coverage of all applicable drugs that the Office is 

13 manufacturing or has entered into a contract to 

14 manufacture under this section. 

15 ‘‘(2) ADVISORY COUNCIL.—The Office shall es16 tablish an advisory council to inform the Office on 

17 the identification of applicable drugs, market land18 scape, and supply chain considerations to ensure de19 livery of applicable drugs to consumers. The advi20 sory committee shall include representatives from 

21 community and retail pharmacies, pharmacy benefit 

22 managers, drug wholesalers, hospitals, health plans, 

23 independent patient groups, clinicians, and consumer 

24 advocacy organizations. 


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1 ‘‘(e) INSULIN.—Not later than 1 year after the date 

2 of enactment of this section, the Office shall begin the 

3 public manufacturing of at least 1 insulin product of each 

4 dosage form (such as vial, pump, or pen dosage forms) 

5 and of each different type of insulin (such as rapid-acting, 

6 short-acting, intermediate-acting, long-acting, ultra-long 

7 acting, and premixed), meeting the definition of applicable 

8 drug and in accordance with this section. 

9 ‘‘(f) ASTHMA AND COPD INHALERS.—Not later than 

10 1 year after the date of enactment of this section, the Of11 fice shall begin the public manufacturing of at least 1 in12 haler, meeting the definition of applicable drug and in ac13 cordance with this section. 

14 ‘‘(g) EPINEPHRINE AUTO-INJECTOR.—Not later 

15 than 1 year after the date of enactment of this section, 

16 the Office shall begin the public manufacturing of an epi17 nephrine auto-injector, meeting the definition of applicable 

18 drug and in accordance with this section. 

19 ‘‘(h) NALOXONE.—Not later than 1 year after the 

20 date of enactment of this section, the Office shall begin 

21 the public manufacturing of naloxone, including naloxone 

22 indicated for community use, meeting the definition of ap23 plicable drug and in accordance with this section. 

24 ‘‘(i) ANTIBIOTICS.—Not later than 1 year after the 

25 date of enactment of this section, and in consultation with 


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1 the Centers for Disease Control and Prevention and the 

2 Food and Drug Administration to ensure the appropriate 

3 use of manufactured antibiotics, the Office shall begin the 

4 public manufacturing of no fewer than three discrete anti5 biotics meeting the definition of applicable drug in accord6 ance with this section. 

7 ‘‘(j) APPLICABLE DRUG.—In this section, the term 

8 ‘applicable drug’ means a drug (as defined in section 201 

9 of the Federal Food, Drug, and Cosmetic Act), biological 

10 product (as defined in section 351 of the Public Health 

11 Service Act), or combination product (as described in sec12 tion 503(g) of the Federal Food, Drug, and Cosmetic Act) 

13 for which an approved application under section 505 or 

14 515 of the Federal Food, Drug, and Cosmetic Act or sec15 tion 351 of the Public Health Service Act, or clearance 

16 under section 510(k) of the Federal Food, Drug, and Cos17 metic Act, is in effect, and— 

18 ‘‘(1)(A) for which, with respect to a drug in19 cluded in the list described in section 505(j)(7) of 

20 the Federal Food, Drug, and Cosmetic Act, each 

21 patent included with respect to such drug in such 

22 list has expired, or each patent that claims a biologi23 cal product has expired; 

24 ‘‘(B) any period of regulatory exclusivity grant25 ed under— 


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1 ‘‘(i) clause (ii), (iii), or (iv) of section 

2 505(c)(3)(E) of the Federal Food, Drug, and 

3 Cosmetic Act, section 505(j)(5)(B)(iv) of such 

4 Act, clause (ii), (iii), or (iv) of section 

5 505(j)(5)(F) of such Act, section 527 of such 

6 Act, and any extension of such a period granted 

7 under section 505A or 505E of such Act, has 

8 expired; or 

9 ‘‘(ii) paragraph (6) or (7) of section 351(k) 

10 of the Public Health Service Act, and any ex11 tension of such a period granted under para12 graph (2) or (3) of section 351(m) of such Act, 

13 has expired; and 

14 ‘‘(C)(i) that is not being marketed in the 

15 United States; or 

16 ‘‘(ii) that is being marketed in the United 

17 States by 3 or fewer manufacturers with an ap18 proved abbreviated new drug application or bio19 similar (not including manufacturers of authorized 

20 generics under a new drug application or biosimilar), 

21 and that— 

22 ‘‘(I) in the previous 5-year period, has ex23 perienced an increase in the wholesale acquisi24 tion cost by at least 1 of its manufacturers that 

25 is greater than the consumer price index for all 


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1 urban consumers (as published by the Bureau 

2 of Labor Statistics) for 1 of the years in that 

3 the same period; 

4 ‘‘(II) is included in the drug shortage list 

5 under section 506E of the Federal Food, Drug, 

6 and Cosmetic Act; or 

7 ‘‘(III)(aa) has an average wholesale acqui8 sition cost that the Office determines to be a 

9 barrier to patient access; and 

10 ‘‘(bb) is listed by the World Health Orga11 nization as an essential medicine; or 

12 ‘‘(2) for which there is in effect a license, or 

13 patent use is authorized, under— 

14 ‘‘(A) section 1498 of title 28, United 

15 States Code; 

16 ‘‘(B) section 202 of title 35, United States 

17 Code; 

18 ‘‘(C) section 203 of title 35, United States 

19 Code (march-in rights); 

20 ‘‘(D) section 209 of title 35, United States 

21 Code; or 

22 ‘‘(E) any other licensing authority of the 

23 Federal Government. 


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1 ‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated such sums as may be 

3 necessary to carry out this section.’’. 

Æ 


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