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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2501 Introduced in Senate (IS)]

106th CONGRESS
  2d Session
                                S. 2501

   To provide access and choice for use of generic drugs instead of 
  nongeneric drugs under Federal health care programs, and for other 
                               purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 3, 2000

  Mr. Johnson introduced the following bill; which was read twice and 
  referred to the Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL

 
   To provide access and choice for use of generic drugs instead of 
  nongeneric drugs under Federal health care programs, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Generic 
Pharmaceutical Access and Choice for Consumers Act of 2000''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings and purposes.
           TITLE I--ENCOURAGEMENT OF THE USE OF GENERIC DRUGS

Sec. 101. Encouragement of the use of generic drugs under the Public 
                            Health Service Act.
Sec. 102. Application to Federal employees health benefits program.
Sec. 103. Application to medicare program.
Sec. 104. Application to medicaid program.
Sec. 105. Application to Indian Health Service.
Sec. 106. Application to veterans programs.
Sec. 107. Application to recipients of uniformed services health care.
Sec. 108. Application to Federal prisoners.
    TITLE II--THERAPEUTIC EQUIVALENCE REQUIREMENTS FOR GENERIC DRUGS

Sec. 201. Therapeutic equivalence of generic drugs.
         TITLE III--GENERIC PHARMACEUTICALS AND MEDICARE REFORM

Sec. 301. Sense of the Senate regarding a preference for the use of 
                            generic pharmaceuticals under the medicare 
                            program.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress makes the following findings:
            (1) Generic pharmaceuticals are approved by the Food and 
        Drug Administration on the basis of testing and other 
        information establishing that such pharmaceuticals are 
        therapeutically equivalent to brand-name pharmaceuticals, 
        ensuring consumers a safe, efficacious, and cost-effective 
        alternative to brand-name pharmaceuticals.
            (2) The pharmaceutical market has become increasingly 
        competitive during the last decade because of the increasing 
        availability and accessibility of generic pharmaceuticals.
            (3) The Congressional Budget Office estimates that--
                    (A) the substitution of generic pharmaceuticals for 
                brand-name pharmaceuticals will save purchasers of 
                pharmaceuticals between $8,000,000,000 and 
                $10,000,000,000 each year; and
                    (B) quality generic pharmaceuticals cost between 25 
                percent and 60 percent less than brand-name 
                pharmaceuticals, resulting in an estimated average 
                savings of $15 to $30 on each prescription filled.
            (4) Generic pharmaceuticals are widely accepted by both 
        consumers and the medical profession, as the market share held 
        by generic pharmaceuticals compared to brand-name 
        pharmaceuticals has more than doubled during the last decade, 
        from approximately 19 percent to 43 percent, according to the 
        Congressional Budget Office.
    (b) Purposes.--The purposes of this Act are--
            (1) to reduce the cost of prescription drugs to the United 
        States Government and to beneficiaries under Federal health 
        care programs while maintaining the quality of health care by 
        encouraging the use of generic drugs rather than nongeneric 
        drugs under those programs whenever feasible; and
            (2) to increase the utilization of generic pharmaceuticals 
        by requiring the Food and Drug Administration, where 
        appropriate, to determine that a generic pharmaceutical is the 
        therapeutic equivalent of its brand-name counterpart, and by 
        affording national uniformity to that determination.

           TITLE I--ENCOURAGEMENT OF THE USE OF GENERIC DRUGS

SEC. 101. ENCOURAGEMENT OF THE USE OF GENERIC DRUGS UNDER THE PUBLIC 
              HEALTH SERVICE ACT.

    (a) In General.--Part B of title II of the Public Health Service 
Act (42 U.S.C. 238 et seq.) is amended by adding at the end the 
following new section:

``SEC. 247. USE OF GENERIC DRUGS ENCOURAGED.

    ``(a) Each grant or contract entered into under this Act that 
involves the provision of health care items or services to individuals 
shall include provisions to ensure that, to the extent feasible, any 
prescriptions provided for under such grant or contract are filled by 
providing the generic form of the drug involved, unless the nongeneric 
form of the drug is--
            ``(1) specifically ordered by the prescribing provider; or
            ``(2) requested by the individual for whom the drug is 
        prescribed.
    ``(b) In this section:
            ``(1) The term `generic form of the drug' means a drug that 
        is the subject of an application approved under section 505(j) 
        of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)), 
        for which the Secretary has made a determination that the drug 
        is the therapeutic equivalent of a listed drug under section 
        505(j)(5)(E) of that Act (21 U.S.C. 355(j)(5)(E)).
            ``(2) The term `nongeneric form of the drug' means a drug 
        that is the subject of an application approved under section 
        505(b) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
        355(b)).''.
    (b) Effective Date.--The amendment made by this section shall apply 
with respect to any drug furnished on or after the date of enactment of 
this Act.

SEC. 102. APPLICATION TO FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM.

    (a) In General.--Section 8902 of title 5, United States Code, is 
amended by adding at the end the following new subsection:
    ``(p) To the extent feasible, if a contract under this chapter 
provides for the provision of, the payment for, or the reimbursement of 
the cost of any prescription drug, the carrier shall provide, pay, or 
reimburse the cost of the generic form of the drug (as defined in 
section 247(b)(1) of the Public Health Service Act), except, if the 
nongeneric form of the drug (as defined in section 247(b)(2) of such 
Act) is--
            ``(1) specifically ordered by the prescribing provider; or
            ``(2) requested by the individual for whom the drug is 
        prescribed.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to any drug furnished during contract years beginning on or after 
January 1, 2001.

SEC. 103. APPLICATION TO MEDICARE PROGRAM.

    (a) In General.--Section 1861(t) of the Social Security Act (42 
U.S.C. 1395x(t)) is amended by adding at the end the following new 
paragraph:
    ``(3) For purposes of paragraph (1), the term `drugs' means, to the 
extent feasible, the generic form of the drug (as defined in section 
247(b)(1) of the Public Health Service Act), unless the nongeneric form 
of such drug (as defined in section 247(b)(2) of such Act) is--
            ``(A) specifically ordered by the health care provider; or
            ``(B) requested by the individual to whom the drug is 
        provided.''.
    (b) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendment made by this section shall apply with respect to any 
        drug furnished on or after the date of enactment of this Act.
            (2) Medicare+choice plans.--In the case of a 
        Medicare+Choice plan offered by a Medicare+Choice organization 
        under part C of title XVIII of the Social Security Act (42 
        U.S.C. 1395w-21 et seq.), the amendment made by this section 
        shall apply to any drug furnished during contract years 
        beginning on or after January 1, 2001.

SEC. 104. APPLICATION TO MEDICAID PROGRAM.

    (a) In General.--Section 1902(a) of the Social Security Act (42 
U.S.C. 1396a(a)) is amended--
            (1) in paragraph (64), by striking ``and'' at the end;
            (2) in paragraph (65), by striking the period at the end 
        and inserting ``; and''; and
            (3) by adding the following new paragraph:
            ``(66) provide that the State shall, in conjunction with 
        the program established under section 1927(g), to the extent 
        feasible, provide for the use of a generic form of a drug (as 
        defined in section 247(b)(1) of the Public Health Service Act), 
        unless the nongeneric form of the drug (as defined in section 
        247(b)(2) of such Act is--
                    ``(A) specifically ordered by the provider; or
                    ``(B) requested by the individual to whom the drug 
                is provided.''.
    (b) Effective Date.--The amendment made by this section shall apply 
with respect to any drug furnished under State plans that are approved 
or renewed on or after the date of enactment of this Act.

SEC. 105. APPLICATION TO INDIAN HEALTH SERVICE.

    (a) In General.--Title II of the Indian Health Care Improvement Act 
(25 U.S.C. 1621 et seq.) is amended by adding at the end the following 
new subsection:

``SEC. 225. USE OF GENERIC DRUGS ENCOURAGED.

    ``In providing health care items or services under this Act, the 
Indian Health Service shall ensure that, to the extent feasible, any 
prescriptions that are provided for under this Act are filled by 
providing the generic form of the drug (as defined in section 247(b)(1) 
of the Public Health Service Act) involved, unless the nongeneric form 
of the drug (as defined in section 247(b)(2) of such Act) is--
            ``(1) specifically ordered by the prescribing provider; or
            ``(2) requested by the individual for whom the drug is 
        prescribed.''.
    (b) Effective Date.--The amendment made by this section shall apply 
with respect to any drug furnished on or after the date of enactment of 
this Act.

SEC. 106. APPLICATION TO VETERANS PROGRAMS.

    (a) Use of Generic Drugs Encouraged.--Subchapter III of chapter 17 
of title 38, United States Code, is amended by inserting after section 
1722A the following new section:
``Sec. 1722B. Use of generic drugs encouraged
    ``When furnishing a prescription drug under this chapter, the 
Secretary shall furnish a generic form of the drug (as defined in 
section 247(b)(1) of the Public Health Service Act), unless the 
nongeneric form of the drug (as defined in section 247(b)(2) of such 
Act) is--
            ``(1) specifically ordered by the prescribing provider; or
            ``(2) requested by the individual for whom the drug is 
        prescribed.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 17 of such title is amended by inserting after the item 
relating to section 1722A the following new item:

``1722B. Use of generic drugs encouraged.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to any drug furnished on or after the date of 
enactment of this Act.

SEC. 107. APPLICATION TO RECIPIENTS OF UNIFORMED SERVICES HEALTH CARE.

    (a) Use of Generic Drugs Encouraged.--Chapter 55 of title 10, 
United States Code, is amended by adding at the end the following new 
section:
``Sec. 1110. Use of generic drugs encouraged
    ``The Secretary of Defense shall ensure that, whenever feasible, 
each health care provider who furnishes a drug furnishes the generic 
form of the drug (as defined in section 247(b)(1) of the Public Health 
Service Act), unless the nongeneric form of the drug (as defined in 
section 247(b)(2) of such Act) is--
            ``(1) specifically ordered by the prescribing provider; or
            ``(2) requested by the individual for whom the drug is 
        prescribed.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by inserting after the item relating to section 
1109 the following new item:

``1110. Use of generic drugs encouraged.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to any drug furnished on or after the date of 
enactment of this Act.

SEC. 108. APPLICATION TO FEDERAL PRISONERS.

    (a) In General.--Section 4006(b) of title 18, United States Code, 
is amended by adding at the end the following new paragraph:
            ``(3) Use of generic drugs encouraged.--The Attorney 
        General shall ensure that, whenever feasible, each health care 
        provider who furnishes a drug to a prisoner charged with or 
        convicted of an offense against the United States furnishes the 
        generic form of the drug (as defined in section 247(b)(1) of 
        the Public Health Service Act), unless the nongeneric form of 
        the drug (as defined in section 247(b)(2) of such Act) is--
                    ``(A) specifically ordered by the prescribing 
                provider; or
                    ``(B) requested by the prisoner for whom the drug 
                is prescribed.''.
    (b) Effective Date.--The amendment made by this section shall apply 
with respect to any drug furnished on or after the date of enactment of 
this Act.

    TITLE II--THERAPEUTIC EQUIVALENCE REQUIREMENTS FOR GENERIC DRUGS

SEC. 201. THERAPEUTIC EQUIVALENCE OF GENERIC DRUGS.

    (a) In General.--Section 505(j) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 355(j)) is amended--
            (1) in paragraph (5), by adding at the end the following 
        new subparagraph:
    ``(E)(i) For each abbreviated application filed under paragraph 
(1), the Secretary shall determine whether the new drug for which the 
application is filed is the therapeutic equivalent of the listed drug 
referred to in paragraph (2)(A)(i) prior to the approval of the 
application.
    ``(ii) For purposes of clause (i), a new drug is the therapeutic 
equivalent of a listed drug if--
            ``(I) each active ingredient of the new drug and the listed 
        drug is the same;
            ``(II) the new drug and the listed drug (aa) are of the 
        same dosage form; (bb) have the same route of administration; 
        (cc) are identical in strength or concentration; (dd) meet the 
        same compendial or other applicable standards, except that the 
        drugs may differ in shape, scoring, configuration, packaging, 
        excipient, expiration time, or, subject to paragraph (2)(A)(v), 
        labeling; and (ee) are expected to have the same clinical 
        effect and safety profile when administered to patients under 
        conditions specified in the labeling; and
            ``(III) the new drug does not (aa) present a known or 
        potential bioequivalence problem and meets an acceptable in 
        vitro standard; or (bb) if the new drug presents a known or 
        potential bioequivalence problem, the drug is shown to meet an 
        appropriate bioequivalence standard.
    ``(iii) With respect to a new drug for which an abbreviated 
application is filed under paragraph (1), the provisions of this 
subparagraph shall supersede any provisions of the law of any State 
relating to the determination of the therapeutic equivalence of the 
drug to a listed drug.''; and
            (2) in paragraph (7)(A), by adding at the end the 
        following:
            ``(iv) The Secretary shall include in each revision of the 
        list under clause (ii) on or after the date of enactment of 
        this clause the official and proprietary name of each listed 
        drug that is therapeutically equivalent to a new drug approved 
        under this subsection during the preceding 30-day period, as 
        determined under paragraph (5)(E).''.
    (b) Effective Date.--The amendments made by this section shall take 
effect on the date of enactment of this Act.

         TITLE III--GENERIC PHARMACEUTICALS AND MEDICARE REFORM

SEC. 301. SENSE OF THE SENATE REGARDING A PREFERENCE FOR THE USE OF 
              GENERIC PHARMACEUTICALS UNDER THE MEDICARE PROGRAM.

    It is the sense of the Senate that legislative language requiring, 
to the extent feasible, a preference for the safe and cost-effective 
use of generic pharmaceuticals should be considered in conjunction with 
any legislation that adds a comprehensive prescription drug benefit to 
the medicare program under title XVIII of the Social Security Act (42 
U.S.C. 1395 et seq.).
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