Calendar No. 609

103D CONGRESS

2D SESSION S. 1981

[Report No. 103–366]

A BILL

To amend the Federal Food, Drug, and Cosmetic

poses.Acts relating to orphan drugs, and for other purphan Drug Act to revise the provisions of suchAct, the Public Health Service Act, and the OrSEPTEMBER 14 (legislative day, SEPTEMBER 12), 1994

Reported without amendment
II

Calendar No. 609

103D CONGRESS

2D SESSION S. 1981

[Report No. 103–366]

To amend the Federal Food, Drug, and Cosmetic Act, the Public Health

Service Act, and the Orphan Drug Act to revise the provisions of such

Acts relating to orphan drugs, and for other purposes.

IN THE SENATE OF THE UNITED STATES

MARCH 24 (legislative day, FEBRUARY 22), 1994

Mrs. KASSEBAUM (for herself, Mr. METZENBAUM, Mr. KENNEDY, and Mr.

SIMON) introduced the following bill; which was read twice and referred

to the Committee on Labor and Human Resources

SEPTEMBER 14 (legislative day, SEPTEMBER 12), 1994

Reported by Mr. KENNEDY, without amendment

A BILL

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

Public Health Service Act, and the Orphan Drug Act

to revise the provisions of such Acts relating to orphan

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,
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1 SECTION 1. SHORT TITLE AND REFERENCE.

2 (a) SHORT TITLE.—This Act may be cited as the

3 ‘‘Orphan Drug Act Amendments of 1994 ’’.

4 (b) REFERENCE.—Whenever in this Act (other than

5 sections 5 and 6) an amendment or repeal is expressed

6 in terms of an amendment to, or repeal of, a section or

7 other provision, the reference shall be considered to be

8 made to a section or other provision of the Federal Food,

9 Drug, and Cosmetic Act (21 U.S.C. 201 et seq.).

10 SEC. 2. PERIOD OF EXCLUSIVITY.

11 (a) INITIAL PERIOD.—Subsection (a) of section 527

12 (21 U.S.C. 360cc) is amended—

13 (1) by inserting ‘‘(1)’’ after ‘‘(a)’’;

14 (2) by redesignating paragraphs (1), (2), and

15 (3) as subparagraphs (A), (B), and (C), respectively;

16 (3) by striking ‘‘seven years’’ and inserting ‘‘4

17 years’’; and

18 (4) by striking ‘‘505(c)(2)’’ and inserting

19 ‘‘505(c)(1)(B)’’.

20 (b) ADDITIONAL PERIOD.—Subsection (a) of section

21 527 (21 U.S.C. 360cc) (as amended by subsection (a)) is

22 amended by adding at the end the following new para23 graphs:

24 ‘‘(2) The holder of the approved application, certifi25 cation, or license of a drug to which the 4-year period of

26 exclusivity applies under paragraph (1) may, after the ex-
3

•S 1981 RS

piration of 31 1 ⁄2 years of such period but not later than

2 90 days before the expiration of such period, apply to the

3 Secretary for a 3-year extension of such period. Such an

4 application shall contain such information as the Secretary

5 determines is necessary to evaluate such application.

6 ‘‘(3) The Secretary shall approve an application sub7 mitted under paragraph (2) if the applicant—

8 ‘‘(A) demonstrates that the drug has a limited

9 commercial potential as determined under regula10 tions of the Secretary, taking into account sales in11 formation respecting such drug and any other factor

12 identified by the Secretary in such regulations that

13 is relevant to the commercial potential of such drug,

14 and

15 ‘‘(B) makes such demonstration on the basis of

16 the regulations of the Secretary referred to in sub17 paragraph (A) that were in effect—

18 ‘‘(i) on the date—

19 ‘‘(I) such drug received its designation

20 under section 526(a), or

21 ‘‘(II) such applicant applied for an ex22 emption for such drug under section 505(i)

23 or 507(d),

24 whichever first occurs, or
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1 ‘‘(ii) if the date under clause (i) occurred

2 before the date such regulations were in effect,

3 on the date such regulations were in effect.’’.

4 (c) CONFORMING AMENDMENT.—Section 527(b) (21

5 U.S.C. 360cc(b)) is amended—

6 (1) by striking ‘‘during the seven-year period

7 beginning on the date of the application approval’’

8 and inserting ‘‘during the applicable period of exclu9 sivity under subsection (a)’’; and

10 (2) by striking ‘‘such seven year period’’ and in11 serting ‘‘the applicable period of exclusivity under

12 subsection (a)’’.

13 (d) EFFECTIVE DATE.—The amendments made by

14 subsections (a) and (b) shall not apply to a drug—

15 (1) for which an application under section 505

16 or 507 of the Federal Food, Drug, and Cosmetic Act

17 or section 351 of the Public Health Service Act was

18 submitted before March 1, 1994; or

19 (2) for which an exemption under section 505(i)

20 or 507(d) of the Federal Food, Drug, and Cosmetic

21 Act was in effect before March 1, 1994, for which

22 human clinical trials were actively being conducted

23 before such date, and for which an application for

24 designation under section 526 of such Act was sub-
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1 mitted before the date of enactment of the Orphan

2 Drug Act Amendments of 1994.

3 The 7 year period of exclusivity provided by section 527(a)

4 of the Federal Food, Drug, and Cosmetic Act before the

5 date of the enactment of this Act shall, after such date,

6 apply to a drug described in paragraph (1) or (2).

7 (e) REGULATIONS.—The Secretary shall issue final

8 regulations to implement paragraphs (2) and (3) of sec9 tion 527(a) of the Federal Food, Drug, and Cosmetic Act

10 (21 U.S.C. 360cc) (as amended by subsection (b)) not

11 later than 6 months after the date of the enactment of

12 this Act.

13 SEC. 3. DESIGNATIONS.

14 (a) IN GENERAL.—Section 526(a)(2) (21 U.S.C.

15 360bb(a)(2)) is amended to read as follows:

16 ‘‘(2) For purposes of paragraph (1), the term ‘rare

17 disease or condition’ means any disease or condition

18 that—

19 ‘‘(A) affects fewer than 200,000 persons in the

20 United States determined on the basis of—

21 ‘‘(i) the facts and circumstances as of the

22 date the request for designation of the drug

23 under this subsection is made, and

24 ‘‘(ii) projections as to the number of per25 sons who will be affected by the disease or con-
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1 dition on a date which is 3 years from date

2 such request was made, or

3 ‘‘(B) affects more than 200,000 persons in the

4 United States and for which there is no reasonable

5 expectation that the cost of developing and making

6 available in the United States a drug for such dis7 ease or condition will be recovered from sales in the

8 United States of such drug.’’.

9 (b) EXCLUSIVITY.—Section 527(b) (21 U.S.C.

10 360cc(b)) is amended—

11 (1) in paragraph (1), by striking ‘‘or’’ at the

12 end of such paragraph;

13 (2) by striking the period at the end of para14 graph (2) and inserting ‘‘; or’’, and

15 (3) by adding at the end the following new

16 paragraph:

17 ‘‘(3) a drug has been designated under section

18 526 for a rare disease or condition described in sec19 tion 526(a)(2)(A) and if after such designation it is

20 determined that—

21 ‘‘(A) such disease or condition affects more

22 than 200,000 persons in the United States; and

23 ‘‘(B) such drug does not meet the require24 ment of section 526(a)(2)(B).’’.
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1 SEC. 4. SIMULTANEOUS DEVELOPMENT.

2 (a) IN GENERAL.—Section 527(b) (21 U.S.C.

3 360cc(b)), as amended by section 3(b), is amended by—

4 (1) inserting ‘‘(1)’’ after ‘‘(b)’’;

5 (2) by redesignating paragraphs (1), (2), and

6 (3) as subparagraphs (A), (B), and (C), respectively;

7 (3) by striking ‘‘for a person who is not’’ and

8 inserting ‘‘for an applicant who is not’’; and

9 (4) by adding at the end the following new sub10 paragraphs:

11 ‘‘(D) the Secretary finds, after providing the

12 holder, such applicant, and any other interested per13 son an opportunity to present their views, that the

14 drugs of the holder and such applicant were devel15 oped simultaneously.

16 The Secretary shall make a decision on a request for a

17 finding under subparagraph (D) not later than 60 days

18 after the filing of the request.

19 ‘‘(2) For purposes of paragraph (1)(D), drugs of a

20 holder and an applicant shall be considered to be devel21 oped simultaneously only if—

22 ‘‘(A) the applicant requested that its drug be

23 designated under section 526 not later than 6

24 months after publication of the designation under

25 section 526(c) of the holder’s drug;
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1 ‘‘(B) the applicant initiated the human clinical

2 trials that the applicant relied on in its application

3 for such approval, certification, or license not more

4 than 12 months after the date the holder initiated

5 the human clinical trials that the holder relied on in

6 its application for such approval, certification, or li7 cense; and

8 ‘‘(C) the applicant submitted such application,

9 including the reports of the clinical and animal stud10 ies necessary for approval, certification, or licensing,

11 not more than 12 months after the holder submitted

12 its application, including such reports, for such ac13 tion.

14 ‘‘(3) Paragraph (1)(D) does not apply to a drug—

15 ‘‘(A) for which an application under section 505

16 or 507 or section 351 of the Public Health Service

17 Act was submitted before March 1, 1994; or

18 ‘‘(B) for which an exemption under section

19 505(i) or 507(d) was in effect before March 1, 1994,

20 for which human clinical trials were actively being

21 conducted before such date, and for which an appli22 cation for designation under section 526 was submit23 ted before the date of enactment of the Orphan

24 Drug Act Amendments of 1994.’’.
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1 (b) PUBLICATION.—Section 526(c) (21 U.S.C.

2 360bb(c)) is amended—

3 (1) by inserting ‘‘for a rare disease or condi4 tion’’ after ‘‘(a)’’; and

5 (2) by striking ‘‘shall be made available to the

6 public’’ and inserting ‘‘shall be promptly published

7 in the Federal Register and otherwise made avail8 able to the public in a manner designed to notify

9 persons who have such disease or condition’’.

10 SEC. 5. OFFICE FOR ORPHAN DISEASES AND CONDITIONS.

11 Section 227 of the Public Health Service Act (42

12 U.S.C. 236) is amended—

13 (1) in subsection (a), to read as follows:

14 ‘‘(a) There is established in the Department of

15 Health and Human Services an Office for Orphan Dis16 eases and Conditions. Such Office shall be established at

17 a level within the Department with sufficient authority to

18 assure full implementation of the functions and respon19 sibilities established by this section.’’;

20 (2) by striking ‘‘Board’’ each place the term ap21 pears and inserting ‘‘Office’’;

22 (3) in subsection (b), by striking ‘‘drugs and

23 devices’’ and inserting ‘‘drugs, devices, and medical

24 foods’’;
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1 (4) in subsection (c)(1)(A), by inserting ‘‘of

2 chapter V’’ after ‘‘subchapter B’’;

3 (5) by adding at the end the following new sub4 section:

5 ‘‘(f)(1) There is established in the Office an advisory

6 committee to advise the Office in carrying out the func7 tions of the Office under this section.

8 ‘‘(2) The advisory committee shall be comprised of

9 11 members appointed by the Secretary, in consultation

10 with the Office and the Commissioner of the Food and

11 Drug Administration, from persons knowledgeable about

12 rare diseases and conditions, including—

13 ‘‘(A) 5 representatives of organizations of per14 sons with rare diseases or conditions;

15 ‘‘(B) 3 research scientists; and

16 ‘‘(C) 3 representatives of health-related compa17 nies.

18 ‘‘(3) The Secretary shall also appoint, as liaisons to

19 the advisory committee, individuals from the Food and

20 Drug Administration, the National Institutes of Health,

21 and other appropriate Federal agencies.

22 ‘‘(4) Vacancies occurring in the membership of the

23 advisory committee shall be filled in the same manner as

24 the original appointment for the position being vacated.
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1 Vacancies shall not affect the power of the remaining

2 members to execute the duties of the advisory committee.

3 ‘‘(5) Members of the advisory committee, and liaisons

4 to the advisory committee, shall not be compensated, but

5 shall receive travel expenses, including per diem in lieu

6 of subsistence, at rates authorized for employees of agen7 cies under subchapter 1 of chapter 57 of title 5, United

8 States Code, for each day the member or liaison is en9 gaged in the performance of duties away from the home

10 or regular place of business of the member or liaison.

11 ‘‘(6) Notwithstanding section 1342 of title 31, United

12 States Code, the advisory committee may accept the vol13 untary services provided by a member of the advisory com14 mittee or a liaison to the advisory committee.’’; and

15 (6) by amending the section heading to read as

16 follows:

17 ‘‘OFFICE FOR ORPHAN DISEASES AND CONDITIONS’’.

18 SEC. 6. AUTHORIZATION FOR ORPHAN DRUG ACT.

19 Section 5(c) of the Orphan Drug Act (21 U.S.C.

20 360ee(c)) is amended by striking ‘‘$10,000,000’’ and all

21 that follows and inserting ‘‘$20,000,000 for fiscal year

22 1995, $25,000,000 for fiscal year 1996, and $30,000,000

23 for fiscal year 1997.’’.