I 

116TH CONGRESS 

1ST SESSION H. R. 4398 

To amend the Federal Trade Commission Act to prohibit anticompetitive 

behaviors by drug product manufacturers, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 19, 2019 

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

Committee on the Judiciary 

A BILL 

To amend the Federal Trade Commission Act to prohibit 

anticompetitive behaviors by drug product manufacturers, 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 ‘‘Affordable Prescrip5 tions for Patients Through Promoting Competition Act of 

6 2019’’. 

7 SEC. 2. PRODUCT HOPPING. 

8 (a) IN GENERAL.—The Federal Trade Commission 

9 Act (15 U.S.C. 41 et seq.) is amended by inserting after 

10 section 26 (15 U.S.C. 57c–2) the following: 


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1 ‘‘SEC. 27. PRODUCT HOPPING. 

2 ‘‘(a) DEFINITIONS.—In this section: 

3 ‘‘(1) ABBREVIATED NEW DRUG APPLICATION.— 

4 The term ‘abbreviated new drug application’ means 

5 an application under subsection (b)(2) or (j) of sec6 tion 505 of the Federal Food, Drug, and Cosmetic 

7 Act (21 U.S.C. 355). 

8 ‘‘(2) BIOSIMILAR BIOLOGICAL PRODUCT.—The 

9 term ‘biosimilar biological product’ means a biologi10 cal product licensed under section 351(k) of the 

11 Public Health Service Act (42 U.S.C. 262(k)). 

12 ‘‘(3) BIOSIMILAR BIOLOGICAL PRODUCT LI13 CENSE APPLICATION.—The term ‘biosimilar biologi14 cal product license application’ means an application 

15 submitted under section 351(k) of the Public Health 

16 Service Act (42 U.S.C. 262(k)). 

17 ‘‘(4) FOLLOW-ON PRODUCT.—The term ‘follow18 on product’— 

19 ‘‘(A) means a drug approved through an 

20 application or supplement to an application sub21 mitted under section 505(b) of the Federal 

22 Food, Drug, and Cosmetic Act (21 U.S.C. 

23 355(c)) or a biological product licensed through 

24 an application or supplement to an application 

25 submitted under section 351(a) of the Public 

26 Health Service Act (42 U.S.C. 262(a)) for a 


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1 change, modification, or reformulation to the 

2 same manufacturer’s previously approved drug 

3 or biological product that treats the same med4 ical condition; and 

5 ‘‘(B) excludes such an application or sup6 plement to an application for a change, modi7 fication, or reformulation of a drug or biological 

8 product that is requested by the Secretary or 

9 necessary to comply with law, including sections 

10 505A and 505B of the Federal Food, Drug, 

11 and Cosmetic Act (21 U.S.C. 355a, 355c). 

12 ‘‘(5) GENERIC DRUG.—The term ‘generic drug’ 

13 means a drug approved under an application sub14 mitted under subsection (b)(2) or (j) of section 505 

15 of the Federal Food, Drug, and Cosmetic Act (21 

16 U.S.C. 355). 

17 ‘‘(6) LISTED DRUG.—The term ‘listed drug’ 

18 means a drug listed under section 505(j)(7) of the 

19 Federal Food, Drug, and Cosmetic Act (21 U.S.C. 

20 355(j)(7)). 

21 ‘‘(7) MANUFACTURER.—The term ‘manufac22 turer’ means the holder, licensee, or assignee of— 

23 ‘‘(A) an approved application for a drug 

24 under section 505(c) of the Federal Food, 

25 Drug, and Cosmetic Act (21 U.S.C. 355(c)); or 


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1 ‘‘(B) a biological product license under sec2 tion 351(a) of the Public Health Service Act 

3 (42 U.S.C. 262(a)). 

4 ‘‘(8) REFERENCE PRODUCT.—The term ‘ref5 erence product’ has the meaning given the term in 

6 section 351(i) of the Public Health Service Act (42 

7 U.S.C. 262(i)). 

8 ‘‘(9) ULTIMATE PARENT ENTITY.—The term 

9 ‘ultimate parent entity’ has the meaning given the 

10 term in section 801.1 of title 16, Code of Federal 

11 Regulations, or any successor regulation. 

12 ‘‘(b) PROHIBITION ON PRODUCT HOPPING.— 

13 ‘‘(1) PRIMA FACIE.—Except as provided in 

14 paragraph (2), a manufacturer of a reference prod15 uct or listed drug shall be considered to have en16 gaged in an unfair method of competition in or af17 fecting commerce in violation of section 5(a) if the 

18 Commission demonstrates by a preponderance of the 

19 evidence in a proceeding initiated by the Commission 

20 under subsection (c)(1)(A), or in a suit brought 

21 under subparagraph (B) or (C) of subsection (c)(1), 

22 that, during the period beginning on the date on 

23 which the manufacturer of the reference product or 

24 listed drug first receives notice that an applicant has 

25 submitted to the Commissioner of Food and Drugs 


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1 an abbreviated new drug application or biosimilar bi2 ological product license application and ending on 

3 the date that is 180 days after the date on which 

4 that generic drug or biosimilar biological product is 

5 first marketed, the manufacturer engaged in either 

6 of the following actions: 

7 ‘‘(A) The manufacturer engaged in a hard 

8 switch, which shall be established by dem9 onstrating that the manufacturer engaged in ei10 ther of the following actions: 

11 ‘‘(i) Upon the request of the manufac12 turer of the listed drug or reference prod13 uct, the Commissioner of Food and Drugs 

14 withdrew the approval of the application 

15 for the listed drug or reference product or 

16 placed the listed drug or reference product 

17 on the discontinued products list and the 

18 manufacturer marketed or sold a follow-on 

19 product. 

20 ‘‘(ii)(I) The manufacturer of the listed 

21 drug or reference product— 

22 ‘‘(aa) announced withdrawal of, 

23 discontinuance of the manufacture of, 

24 or intent to withdraw the application 

25 with respect to the drug or reference 


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1 product in a manner that impedes 

2 competition from a generic drug or a 

3 biosimilar biological product, as estab4 lished by objective circumstances; or 

5 ‘‘(bb) destroyed the inventory of 

6 the listed drug or reference product in 

7 a manner that impedes competition 

8 from a generic drug or a biosimilar bi9 ological product, which may be estab10 lished by objective circumstances; and 

11 ‘‘(II) marketed or sold a follow-on 

12 product. 

13 ‘‘(B) The manufacturer engaged in a soft 

14 switch, which shall be established by dem15 onstrating that the manufacturer engaged in 

16 both of the following actions: 

17 ‘‘(i) The manufacturer took actions 

18 with respect to the listed drug or reference 

19 product other than those described in sub20 paragraph (A) that unfairly disadvantage 

21 the listed drug or reference product rel22 ative to the follow-on product described in 

23 clause (ii) in a manner that impedes com24 petition from a generic drug or a bio25 similar biological product that is highly 


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1 similar to, and has no clinically meaningful 

2 difference with respect to safety, purity, 

3 and potency from, the reference product, 

4 which may be established by objective cir5 cumstances. 

6 ‘‘(ii) The manufacturer marketed or 

7 sold a follow-on product. 

8 ‘‘(2) JUSTIFICATION.— 

9 ‘‘(A) IN GENERAL.—Subject to paragraph 

10 (3), the actions described in paragraph (1) by 

11 a manufacturer of a listed drug or reference 

12 product shall not be considered to be an unfair 

13 method of competition in or affecting commerce 

14 if— 

15 ‘‘(i) the manufacturer demonstrates to 

16 the Commission or a district court of the 

17 United States, as applicable, by a prepon18 derance of the evidence in a proceeding ini19 tiated by the Commission under subsection 

20 (c)(1)(A), or in a suit brought under sub21 paragraph (B) or (C) of subsection (c)(1), 

22 that— 

23 ‘‘(I) the manufacturer would 

24 have taken the actions regardless of 

25 whether a generic drug that refVerDate Sep 11 2014 21:44 Sep 20, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4398.IH H4398

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1 erences the listed drug or biosimilar 

2 biological product that references the 

3 reference product had already entered 

4 the market; and 

5 ‘‘(II)(aa) with respect to a hard 

6 switch under paragraph (1)(A), the 

7 manufacturer took the action for rea8 sons relating to the safety risk to pa9 tients of the listed drug or reference 

10 product; 

11 ‘‘(bb) with respect to an action 

12 described in item (aa) or (bb) of para13 graph (1)(A)(ii)(I), there is a supply 

14 disruption that— 

15 ‘‘(AA) is outside of the con16 trol of the manufacturer; 

17 ‘‘(BB) prevents the produc18 tion or distribution of the appli19 cable listed drug or reference 

20 product; and 

21 ‘‘(CC) cannot be remedied 

22 by reasonable efforts; or 

23 ‘‘(cc) with respect to a soft 

24 switch under paragraph (1)(B), the 

25 manufacturer had legitimate pro-comVerDate Sep 11 2014 21:44 Sep 20, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4398.IH H4398

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1 petitive reasons, apart from the finan2 cial effects of reduced competition, to 

3 take the action. 

4 ‘‘(B) RULE OF CONSTRUCTION.—Nothing 

5 in subparagraph (A) may be construed to limit 

6 the information that the Commission may oth7 erwise obtain in any proceeding or action insti8 tuted with respect to a violation of this section. 

9 ‘‘(3) RESPONSE.—With respect to a justifica10 tion offered by a manufacturer under paragraph (2), 

11 the Commission may— 

12 ‘‘(A) rebut any evidence presented by a 

13 manufacturer during that justification; or 

14 ‘‘(B) establish by a preponderance of the 

15 evidence that, on balance, the pro-competitive 

16 benefits from the conduct described in subpara17 graph (A) or (B) of paragraph (1), as applica18 ble, do not outweigh any anticompetitive effects 

19 of the conduct, even in consideration of the jus20 tification so offered. 

21 ‘‘(c) ENFORCEMENT.— 

22 ‘‘(1) IN GENERAL.—If the Commission has rea23 son to believe that any manufacturer has violated, is 

24 violating, or is about to violate this section, the 

25 Commission may take any of the following actions: 


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1 ‘‘(A) Institute a proceeding— 

2 ‘‘(i) that, except as provided in para3 graph (2), complies with the requirements 

4 under section 5(b); and 

5 ‘‘(ii) in which the Commission may 

6 impose on the manufacturer any penalty 

7 that the Commission may impose for a vio8 lation of section 5. 

9 ‘‘(B) In the same manner and to the same 

10 extent as provided in section 13(b), bring suit 

11 in a district court of the United States to tem12 porarily enjoin the action of the manufacturer. 

13 ‘‘(C) Bring suit in a district court of the 

14 United States, in which the Commission may 

15 seek— 

16 ‘‘(i) to permanently enjoin the action 

17 of the manufacturer; 

18 ‘‘(ii) any of the remedies described in 

19 paragraph (3); and 

20 ‘‘(iii) any other equitable remedy, in21 cluding ancillary equitable relief. 

22 ‘‘(2) JUDICIAL REVIEW.— 

23 ‘‘(A) IN GENERAL.—Notwithstanding any 

24 provision of section 5, any manufacturer that is 

25 subject to a final order of the Commission that 


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1 is issued in a proceeding initiated under para2 graph (1)(A) may, not later than 30 days after 

3 the date on which the Commission issues the 

4 order, petition for review of the order in— 

5 ‘‘(i) the United States Court of Ap6 peals for the District of Columbia Circuit; 

7 or 

8 ‘‘(ii) the court of appeals of the 

9 United States for the circuit in which the 

10 ultimate parent entity of the manufacturer 

11 is incorporated. 

12 ‘‘(B) TREATMENT OF FINDINGS.—In a re13 view of an order issued by the Commission con14 ducted by a court of appeals of the United 

15 States under subparagraph (A), the factual 

16 findings of the Commission shall be conclusive 

17 if those facts are supported by the evidence. 

18 ‘‘(3) EQUITABLE REMEDIES.— 

19 ‘‘(A) DISGORGEMENT.— 

20 ‘‘(i) IN GENERAL.—In a suit brought 

21 under paragraph (1)(C), the Commission 

22 may seek, and the court may order, 

23 disgorgement of any unjust enrichment 

24 that a person obtained as a result of the 

25 violation that gives rise to the suit. 


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1 ‘‘(ii) CALCULATION.—Any disgorge2 ment that is ordered with respect to a per3 son under clause (i) shall be offset by any 

4 amount of restitution ordered under sub5 paragraph (B). 

6 ‘‘(iii) LIMITATIONS PERIOD.—The 

7 Commission may seek disgorgement under 

8 this subparagraph not later than 5 years 

9 after the latest date on which the person 

10 from which the disgorgement is sought re11 ceives any unjust enrichment from the ef12 fects of the violation that gives rise to the 

13 suit in which the Commission seeks the 

14 disgorgement. 

15 ‘‘(B) RESTITUTION.— 

16 ‘‘(i) IN GENERAL.—In a suit brought 

17 under paragraph (1)(C), the Commission 

18 may seek, and the court may order, res19 titution with respect to the violation that 

20 gives rise to the suit. 

21 ‘‘(ii) LIMITATIONS PERIOD.—The 

22 Commission may seek restitution under 

23 this subparagraph not later than 5 years 

24 after the latest date on which the person 

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1 ceives any unjust enrichment from the ef2 fects of the violation that gives rise to the 

3 suit in which the Commission seeks the 

4 restitution. 

5 ‘‘(4) RULES OF CONSTRUCTION.—Nothing in 

6 this subsection may be construed as— 

7 ‘‘(A) requiring the Commission to bring a 

8 suit seeking a temporary injunction under para9 graph (1)(B) before bringing a suit seeking a 

10 permanent injunction under paragraph (1)(C); 

11 or 

12 ‘‘(B) affecting any other authority of the 

13 Commission under this Act to seek relief or ob14 tain a remedy with respect to a violation of this 

15 Act.’’. 

16 (b) APPLICABILITY.—Section 27 of the Federal 

17 Trade Commission Act, as added by subsection (a), shall 

18 apply with respect to any— 

19 (1) conduct that occurs on or after the date of 

20 enactment of this Act; and 

21 (2) action or proceeding that is commenced on 

22 or after the date of enactment of this Act. 

23 (c) ANTITRUST LAWS.—Nothing in this section, or 

24 the amendments made by this section, shall modify, im25 pair, limit, or supersede the applicability of the antitrust 


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1 laws as defined in subsection (a) of the first section of 

2 the Clayton Act (15 U.S.C. 12(a)), and of section 5 of 

3 the Federal Trade Commission Act (15 U.S.C. 45) to the 

4 extent that it applies to unfair methods of competition. 

5 (d) RULEMAKING.—The Federal Trade Commission 

6 may issue rules under section 553 of title 5, United States 

7 Code, to carry out section 27 of the Federal Trade Com8 mission Act, as added by subsection (a), including by de9 fining any terms used in such section 27 (other than terms 

10 that are defined in subsection (a) of such section 27). 

Æ 


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