II 

117TH CONGRESS 

2D SESSION S. 3991 

To direct the Secretary of Health and Human Services to conduct a demonstration program to test providing preferential treatment under the 

Medicare, Medicaid, and CHIP programs for certain drugs and 

biologicals manufactured in the United States. 

IN THE SENATE OF THE UNITED STATES 

APRIL 5, 2022 

Ms. SMITH (for herself and Mr. COTTON) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL 

To direct the Secretary of Health and Human Services to 

conduct a demonstration program to test providing preferential treatment under the Medicare, Medicaid, and 

CHIP programs for certain drugs and biologicals manufactured in the United States. 

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 ‘‘American Made Phar5 maceuticals Act of 2022’’. 


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1 SEC. 2. DEMONSTRATION PROGRAM TO TEST PROVIDING 

2 PREFERENTIAL TREATMENT UNDER THE 

3 MEDICARE, MEDICAID, AND CHIP PROGRAMS 

4 FOR CERTAIN DRUGS AND BIOLOGICALS 

5 MANUFACTURED IN THE UNITED STATES. 

6 Part A of title XI of the Social Security Act (42 

7 U.S.C. 1301 et seq.) is amended by inserting after section 

8 1150C the following: 

9 ‘‘SEC. 1150D. DEMONSTRATION PROGRAM TO TEST PRO10 VIDING PREFERENTIAL TREATMENT UNDER 

11 THE MEDICARE, MEDICAID, AND CHIP PRO12 GRAMS FOR CERTAIN DRUGS AND 

13 BIOLOGICALS MANUFACTURED IN THE 

14 UNITED STATES. 

15 ‘‘(a) IN GENERAL.—Not later than 1 year after the 

16 date of enactment of this section, the Secretary shall con17 duct a demonstration program (in this section referred to 

18 as the ‘Program’) under which U.S. manufactured drugs 

19 are given preference under titles XVIII, XIX, and XXI 

20 compared to drugs that are not U.S. manufactured drugs 

21 through the use of applicable tools. 

22 ‘‘(b) SITES.—The Program shall be conducted in at 

23 least 8 States. 

24 ‘‘(c) DURATION.—The Secretary shall conduct the 

25 Program for a period of not less than 7 years. 

26 ‘‘(d) DEFINITIONS.—In this section: 


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1 ‘‘(1) APPLICABLE DRUG.—The term ‘applicable 

2 drug’ means— 

3 ‘‘(A) a drug that is approved and marketed 

4 under section 505(j) of the Federal Food, 

5 Drug, and Cosmetic Act; 

6 ‘‘(B) a biological product that is licensed 

7 and marketed under section 351(k) of the Pub8 lic Health Service Act; or 

9 ‘‘(C) a critical drug. 

10 ‘‘(2) APPLICABLE U.S.-BASED PHARMA11 CEUTICAL COMPANY.—The term ‘applicable U.S.- 

12 based pharmaceutical company’ means a manufac13 turer (as defined in section 1860D–14A(g)(5))— 

14 ‘‘(A) that has a manufacturing location in 

15 the United States for an applicable drug; 

16 ‘‘(B) beginning 3 years after the date of 

17 the implementation of the Program, for which 

18 at least 50 percent of the starter products, by 

19 weight, for the applicable drugs manufactured 

20 by manufacturer are derived from countries 

21 other than covered nations (as defined in sec22 tion 4871(d)(2) of title 10, United States 

23 Code); and 

24 ‘‘(C) that, as determined by the Sec25 retary— 


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1 ‘‘(i) maintains an appropriate level of 

2 transparency on locations of manufac3 turing; 

4 ‘‘(ii) maintains an appropriate level of 

5 diversity in sourcing; 

6 ‘‘(iii) maintains appropriate levels of 

7 inventory and emergency reserves; 

8 ‘‘(iv) has in place an appropriate ac9 tion plan for increases in demand and for 

10 when links in the supply chain break down; 

11 and 

12 ‘‘(v) meets any other characteristics 

13 the Secretary determines appropriate. 

14 ‘‘(3) APPLICABLE TOOLS.—The term ‘applica15 ble tools’ means tools determined appropriate by the 

16 Secretary, such as— 

17 ‘‘(A) preferential treatment on a for18 mulary; 

19 ‘‘(B) providing lower cost-sharing; 

20 ‘‘(C) waiving rebates under the Medicaid 

21 program under title XIX; 

22 ‘‘(D) establishing a Medicare Star Rating 

23 under part D of title XVIII; or 


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1 ‘‘(E) providing bonus payments to pro2 viders of services and suppliers under part B of 

3 title XVIII. 

4 ‘‘(4) CRITICAL DRUG.—In this section, the term 

5 ‘critical drug’ includes the following: 

6 ‘‘(A) A medicine, medical countermeasure, 

7 or critical input identified on the list under sec8 tion 3(c) of Executive Order 13944 of August 

9 6, 2020 (85 Red. Reg 49929; relating to essen10 tial medicines, medical Countermeasures, and 

11 critical inputs). 

12 ‘‘(B) A drug or biological that— 

13 ‘‘(i) is not described in subparagraph 

14 (A); 

15 ‘‘(ii) is approved and marketed under 

16 section 505(c) of the Federal Food, Drug, 

17 and Cosmetic Act or is licensed and mar18 keted under section 351(a) of the Public 

19 Health Service Act (or is an active phar20 maceutical ingredient of such a drug or bi21 ological); 

22 ‘‘(iii) the Secretary determines— 

23 ‘‘(I) is— 


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1 ‘‘(aa) likely to be needed for 

2 use in a public health emergency; 

3 or 

4 ‘‘(bb) at high risk of short 

5 supply; and 

6 ‘‘(II) has a vulnerable global sup7 ply chain. 

8 ‘‘(5) U.S. MANUFACTURED DRUG.—The term 

9 ‘U.S. manufactured drug’ means an applicable drug 

10 that is manufactured in the United States by an ap11 plicable U.S.-based pharmaceutical company. 

12 ‘‘(e) ANNUAL REPORT TO CONGRESS.—Not later 

13 than 1 year after the date the Secretary implements the 

14 Program, and annually thereafter for as long as the Pro15 gram is being conducted, the Secretary shall submit to 

16 Congress a report on activities under the Program, to17 gether with recommendations for such legislation and ad18 ministrative action as the Secretary determines to be ap19 propriate. 

20 ‘‘(f) WAIVERS.—The Secretary may waive such provi21 sions of this title and titles XVIII, XIX, and XXI as the 

22 Secretary determines necessary in order to implement the 

23 Program 

24 ‘‘(g) ADMINISTRATIVE FUNDING.—There is author25 ized to be appropriated to the Secretary such sums as may 


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1 be necessary for the administrative expenses of carrying 

2 out the Program, to remain available until expended.’’. 

Æ 


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