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[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 2328 Introduced in Senate (IS)]

108th CONGRESS
  2d Session
                                S. 2328

 To amend the Federal Food, Drug, and Cosmetic Act with respect to the 
       importation of prescription drugs, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             April 21, 2004

   Mr. Dorgan (for himself, Ms. Snowe, Mr. Kennedy, Mr. McCain, Mr. 
 Daschle, Mr. Lott, Ms. Stabenow, Mr. Chafee, Mr. Johnson, Mr. Pryor, 
 and Mr. Feingold) introduced the following bill; which was read twice 
and referred to the Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL

 
 To amend the Federal Food, Drug, and Cosmetic Act with respect to the 
       importation of prescription drugs, 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.

    This Act may be cited as the ``Pharmaceutical Market Access and 
Drug Safety Act of 2004''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) Americans unjustly pay up to 5 times more to fill their 
        prescriptions than consumers in other countries;
            (2) the United States is the largest market for 
        pharmaceuticals in the world, yet American consumers pay the 
        highest prices for brand pharmaceuticals in the world;
            (3) a prescription drug is neither safe nor effective to an 
        individual who cannot afford it;
            (4) allowing and structuring the importation of 
        prescription drugs to ensure access to safe and affordable 
        drugs approved by the Food and Drug Administration will provide 
        a level of safety to American consumers that they do not 
        currently enjoy;
            (5) American seniors alone will spend $1,800,000,000,000 on 
        pharmaceuticals over the next 10 years; and
            (6) allowing open pharmaceutical markets could save 
        American consumers at least $38,000,000,000 each year.

SEC. 3. REPEAL OF CERTAIN SECTION REGARDING IMPORTATION OF PRESCRIPTION 
              DRUGS.

    Chapter VIII of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
381 et seq.) is amended by striking section 804.

SEC. 4. IMPORTATION OF PRESCRIPTION DRUGS; WAIVER OF CERTAIN IMPORT 
              RESTRICTIONS.

    (a) In General.--Chapter VIII of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 381 et seq.), as amended by section 3 of this 
Act, is further amended by inserting after section 803 the following:

``SEC. 804. COMMERCIAL AND PERSONAL IMPORTATION OF PRESCRIPTION DRUGS.

    ``(a) Importation of Prescription Drugs.--
            ``(1) In general.--The Secretary shall in accordance with 
        this section provide by regulation that, in the case of 
        qualifying drugs imported or offered for import into the United 
        States from registered exporters or by registered importers--
                    ``(A) the limitation on importation that is 
                established in section 801(d)(1) is waived; and
                    ``(B) the standards referred to in section 801(a) 
                regarding admission of the drugs are subject to 
                subsection (g) of this section (including with respect 
                to qualifying drugs to which section 801(d)(1) does not 
                apply).
            ``(2) Importers.--A qualifying drug may not be imported 
        under paragraph (1) unless--
                    ``(A) the drug is imported by a pharmacy or a 
                wholesaler that is a registered importer; or
                    ``(B) the drug is imported by an individual for 
                personal use or for the use of a family member of the 
                individual (not for resale) from a registered exporter.
            ``(3) Rule of construction.--This section shall apply only 
        with respect to a drug that is imported or offered for import 
        into the United States--
                    ``(A) by a registered importer; or
                    ``(B) from a registered exporter to an individual.
            ``(4) Definitions.--
                    ``(A) Registered exporter; registered importer.--
                For purposes of this section:
                            ``(i) The term `registered exporter' means 
                        an exporter for which a registration under 
                        subsection (b) has been approved and is in 
                        effect.
                            ``(ii) The term `registered importer' means 
                        a pharmacy, group of pharmacies, or a 
                        wholesaler for which a registration under 
                        subsection (b) has been approved and is in 
                        effect.
                            ``(iii) The term `registration condition' 
                        means a condition that must exist for a 
                        registration under subsection (b) to be 
                        approved.
                    ``(B) Qualifying drug.--For purposes of this 
                section, the term `qualifying drug' means a 
                prescription drug, other than any of the following:
                            ``(i) A controlled substance, as defined in 
                        section 102 of the Controlled Substances Act 
                        (21 U.S.C. 802).
                            ``(ii) A biological product, as defined in 
                        section 351 of the Public Health Service Act 
                        (42 U.S.C. 262).
                            ``(iii) An infused drug, including a 
                        peritoneal dialysis solution.
                            ``(iv) An intravenously injected drug.
                            ``(v) A drug that is inhaled during 
                        surgery.
                    ``(C) Other definitions.--For purposes of this 
                section:
                            ``(i) The term `exporter' means a person 
                        that is in the business of exporting a drug 
                        from Canada to individuals in the United States 
                        or that, pursuant to submitting a registration 
                        under subsection (b), seeks to be in such 
                        business.
                            ``(ii) The term `importer' means a 
                        pharmacy, a group of pharmacies, or a 
                        wholesaler that is in the business of importing 
                        a drug into the United States or that, pursuant 
                        to submitting a registration under subsection 
                        (b), seeks to be in such business.
                            ``(iii) The term `pharmacist' means a 
                        person licensed by a State to practice 
                        pharmacy, including the dispensing and selling 
                        of prescription drugs.
                            ``(iv) The term `pharmacy' means a person 
                        that--
                                    ``(I) is licensed by a State to 
                                engage in the business of selling 
                                prescription drugs at retail; and
                                    ``(II) employs 1 or more 
                                pharmacists.
                            ``(v) The term `prescription drug' means a 
                        drug that is described in section 503(b)(1).
                            ``(vi) The term `wholesaler'--
                                    ``(I) means a person licensed as a 
                                wholesaler or distributor of 
                                prescription drugs in the United States 
                                under section 503(e)(2)(A); and
                                    ``(II) does not include a person 
                                authorized to import drugs under 
                                section 801(d)(1).
                    ``(D) Permitted country.--The term `permitted 
                country' means--
                            ``(i) Australia;
                            ``(ii) Canada;
                            ``(iii) a member country of the European 
                        Union as of January 1, 2003;
                            ``(iv) Japan;
                            ``(v) New Zealand; and
                            ``(vi) Switzerland.
    ``(b) Registration of Importers and Exporters.--
            ``(1) Registration of importers and exporters.--A 
        registration condition is that the importer or exporter 
        involved (referred to in this subsection as a `registrant') 
        submits to the Secretary a registration containing the 
        following:
                    ``(A) The name of the registrant and an 
                identification of all places of business of the 
                registrant that relate to qualifying drugs, including 
                each warehouse or other facility owned or controlled 
                by, or operated for, the registrant.
                    ``(B) Such information as the Secretary determines 
                to be necessary to demonstrate that the registrant is 
                in compliance with registration conditions under--
                            ``(i) in the case of an importer, 
                        subsections (c), (d), (e), (g), and (j) 
                        (relating to the sources of exported drugs; the 
                        inspection of facilities of the importer; the 
                        payment of fees; compliance with the standards 
                        referred to in section 801(a); and maintenance 
                        of records and samples); or
                            ``(ii) in the case of an exporter, 
                        subsections (c), (d), (f), (g), (h), (i), and 
                        (j) (relating to the sources of exported drugs; 
                        the inspection of facilities of the exporter 
                        and the marking of compliant shipments; the 
                        payment of fees; and compliance with the 
                        standards referred to in section 801(a); being 
                        licensed as a pharmacist; conditions for 
                        individual importation from Canada; and 
                        maintenance of records and samples).
                    ``(C) An agreement by the registrant that the 
                registrant will not under subsection (a) import or 
                export any drug that is not a qualifying drug.
                    ``(D) An agreement by the registrant to--
                            ``(i) notify the Secretary of a recall or 
                        withdrawal of a drug distributed in a permitted 
                        country that the registrant has exported or 
                        imported, or intends to export or import, to 
                        the United States under subsection (a);
                            ``(ii) provide for the return to the 
                        registrant of such drug; and
                            ``(iii) cease, or not begin, the 
                        exportation or importation of such drug unless 
                        the Secretary has notified the registrant that 
                        exportation or importation of such drug may 
                        proceed.
                    ``(E) An agreement by the registrant to ensure and 
                monitor compliance with each registration condition, to 
                promptly correct any noncompliance with such a 
                condition, and to promptly report to the Secretary any 
                such noncompliance.
                    ``(F) A plan describing the manner in which the 
                registrant will comply with the agreement under 
                subparagraph (E).
                    ``(G) An agreement by the registrant to enforce a 
                contract under subsection (c)(3)(B) against a party in 
                the chain of custody of a qualifying drug with respect 
                to the authority of the Secretary under clauses (ii) 
                and (iii) of that subsection.
                    ``(H) An agreement by the registrant to notify the 
                Secretary of--
                            ``(i) any change that the registrant 
                        intends to make regarding information provided 
                        under subparagraph (A) or (B); and
                            ``(ii) any change that the registrant 
                        intends to make in the compliance plan under 
                        subparagraph (F).
                    ``(I) In the case of an exporter--
                            ``(i) An agreement by the exporter that a 
                        qualifying drug will not under subsection (a) 
                        be exported to any individual not authorized 
                        pursuant to subsection (a)(2)(B) to be an 
                        importer of such drug.
                            ``(ii) An agreement to post a bond, payable 
                        to the Treasury of the United States if, after 
                        opportunity for an informal hearing, the 
                        Secretary determines that the exporter has 
                        exported a drug to the United States that is 
                        not a qualifying drug or that is not in 
                        compliance with subsections (g) or (i), that is 
                        equal in value to the lesser of--
                                    ``(I) the value of drugs exported 
                                by the exporter to the United States in 
                                a typical 4-week period over the course 
                                of a year under this section; or
                                    ``(II) $1,000,000.
                    ``(J) Such other provisions as the Secretary may 
                require to protect the public health while permitting--
                            ``(i) the importation by pharmacies, groups 
                        of pharmacies, wholesalers as registered 
                        importers of qualifying drugs under subsection 
                        (a); and
                            ``(ii) importation by individuals of 
                        qualifying drugs under subsection (a).
            ``(2) Approval or disapproval of registration.--
                    ``(A) In general.--Not later than 90 days after the 
                date on which a registrant submits to the Secretary a 
                registration under paragraph (1), the Secretary shall 
                notify the registrant whether the registration is 
                approved or is disapproved. The Secretary shall 
                disapprove a registration if there is reason to believe 
                that the registrant is not in compliance with one or 
                more registration conditions, and shall notify the 
                registrant of such reason. In the case of a disapproved 
                registration, the Secretary shall subsequently notify 
                the registrant that the registration is approved if the 
                Secretary determines that the registrant is in 
                compliance with such conditions.
                    ``(B) Changes in registration information.--Not 
                later than 30 days after receiving a notice under 
                paragraph (1)(G) from a registrant, the Secretary shall 
                determine whether the change involved affects the 
                approval of the registration of the registrant under 
                paragraph (1), and shall inform the registrant of the 
                determination.
            ``(3) Publication of contact information for registered 
        exporters.--Through the Internet website of the Food and Drug 
        Administration, the Secretary shall make readily available to 
        the public a list of registered exporters, including contact 
        information for the exporters. Promptly after the approval of a 
        registration submitted under paragraph (1), the Secretary shall 
        update the Internet website accordingly.
            ``(4) Suspension and termination.--
                    ``(A) Suspension.--With respect to the 
                effectiveness of a registration submitted under 
                paragraph (1):
                            ``(i) Subject to clause (ii), if the 
                        Secretary determines, after notice and 
                        opportunity for a hearing, that the registrant 
                        has failed to maintain substantial compliance 
                        with all registration conditions, the Secretary 
                        may suspend the registration.
                            ``(ii) If the Secretary determines that, 
                        under color of the registration, the exporter 
                        has exported a drug or the importer has 
                        imported a drug that is not a qualifying drug, 
                        or a drug that does not meet the criteria under 
                        subsection (g)(2)(A), or has exported a 
                        qualifying drug to an individual in violation 
                        of subsection (i)(1)(F), the Secretary shall 
                        immediately suspend the registration. A 
                        suspension under the preceding sentence is not 
                        subject to the provision by the Secretary of 
                        prior notice, and the Secretary shall provide 
                        to the registrant an opportunity for a hearing 
                        not later than 10 days after the date on which 
                        the registration is suspended.
                            ``(iii) The Secretary may reinstate the 
                        registration, whether suspended under clause 
                        (i) or (ii), if the Secretary determines that 
                        the registrant has demonstrated that further 
                        violations of registration conditions will not 
                        occur.
                    ``(B) Termination.--The Secretary, after notice and 
                opportunity for a hearing, may terminate the 
                registration under paragraph (1) of a registrant if the 
                Secretary determines that the registrant has engaged in 
                a pattern or practice of violating 1 or more 
                registration conditions, or if on 1 or more occasions 
                the Secretary has under subparagraph (A)(ii) suspended 
                the registration of the registrant. The Secretary may 
                make the termination permanent, or for a fixed period 
                of not less than 1 year. During the period in which the 
                registration is terminated, any registration submitted 
                under paragraph (1) by the registrant, or a person that 
is a partner in the export or import enterprise, or a principal officer 
in such enterprise, and any registration prepared with the assistance 
of the registrant or such a person, has no legal effect under this 
section.
    ``(c) Sources of Qualifying Drugs.--A registration condition is 
that the exporter or importer involved agrees that a qualifying drug 
will under subsection (a) be exported or imported to the United States 
only if there is compliance with the following:
            ``(1) The drug was manufactured in an establishment--
                    ``(A) required to register under subsection (h) or 
                (i) of section 510; or
                    ``(B) inspected by the Secretary as provided by 
                this section.
            ``(2) The establishment is located in the United States or 
        in any foreign country, and the establishment manufactured the 
        drug for distribution in the United States or for distribution 
        in 1 or more of the permitted countries (without regard to 
        whether in addition the drug was manufactured for distribution 
        in a foreign country that is not a permitted country).
            ``(3) The exporter or importer obtained the drug--
                    ``(A) directly from the establishment; or
                    ``(B) directly from an entity that, by contract 
                with the exporter or importer--
                            ``(i) provides to the exporter or importer 
                        a statement (in such form and containing such 
                        information as the Secretary may require) that, 
                        for the chain of custody from the 
                        establishment, identifies each prior sale, 
                        purchase, or trade of the drug (including the 
                        date of the transaction and the names and 
                        addresses of all parties to the transaction);
                            ``(ii) agrees to permit the Secretary to 
                        inspect such statements and related records to 
                        determine their accuracy;
                            ``(iii) agrees, with respect to the 
                        qualifying drugs involved, to permit the 
                        Secretary to inspect warehouses and other 
                        facilities of the entity for purposes of 
                        determining whether the facilities are in 
                        compliance with any standards under this Act 
                        that are applicable to facilities of that type 
                        in the United States; and
                            ``(iv) has ensured, through such 
                        contractual relationships as may be necessary, 
                        that the Secretary has the same authority 
                        regarding other parties in the chain of custody 
                        from the establishment that the Secretary has 
                        under clauses (ii) and (iii) regarding such 
                        entity.
            ``(4) The foreign country from which the importer will 
        import the drug is a permitted country.
            ``(5) The foreign country from which the exporter will 
        export the drug is Canada.
            ``(6) During any period in which the drug was not in the 
        control of the manufacturer of the drug, the drug did not enter 
        any country that is not a permitted country.
            ``(7) The exporter or importer retains a sample of each lot 
        of the drug sufficient for testing by the Secretary.
    ``(d) Inspection of Facilities; Marking of Shipments.--
            ``(1) Inspection of facilities.--A registration condition 
        is that, for the purpose of assisting the Secretary in 
        determining whether the exporter involved is in compliance with 
        all other registration conditions--
                    ``(A) the exporter agrees to permit the Secretary--
                            ``(i) to conduct onsite inspections, 
                        including monitoring on a day-to-day basis, of 
                        places of business of the exporter that relate 
                        to qualifying drugs, including each warehouse 
                        or other facility owned or controlled by, or 
                        operated for, the exporter;
                            ``(ii) to have access, including on a day-
                        to-day basis, to--
                                    ``(I) records of the exporter that 
                                relate to the export of such drugs, 
                                including financial records; and
                                    ``(II) samples of such drugs;
                            ``(iii) to carry out the duties described 
                        in paragraph (3); and
                            ``(iv) to carry out any other functions 
                        determined by the Secretary to be necessary 
                        regarding the compliance of the exporter; and
                    ``(B) the Secretary has assigned 1 or more 
                employees of the Secretary to carry out the functions 
                described in this subsection for the Secretary not less 
                than every 3 weeks on the premises of places of 
                businesses referred to in subparagraph (A)(i), and such 
                an assignment remains in effect on a continuous basis.
            ``(2) Marking of compliant shipments.--A registration 
        condition is that the exporter involved agrees to affix to each 
        shipping container of qualifying drugs exported under 
        subsection (a) such markings as the Secretary determines to be 
        necessary to identify the shipment as being in compliance with 
        all registration conditions. Markings under the preceding 
        sentence--
                    ``(A) shall be designed to prevent affixation of 
                the markings to any shipping container that is not 
                authorized to bear the markings; and
                    ``(B) may include anti-counterfeiting or track-and-
                trace technologies.
            ``(3) Certain duties relating to exporters.--Duties of the 
        Secretary with respect to an exporter include the following:
                    ``(A) Verifying the chain of custody of a 
                statistically significant sample of qualifying drugs 
                from the establishment in which the drug was 
                manufactured to the exporter, which may be accomplished 
                by the use of anticounterfeiting or track-and-trace 
                technologies, if available.
                    ``(B) Randomly reviewing records of exports to 
                individuals for the purpose of determining whether the 
                drugs are being imported by the individuals in 
                accordance with the conditions under subsection (i). 
                Such reviews shall be conducted in a manner that will 
                result in a statistically significant determination of 
                compliance with all such conditions.
                    ``(C) Monitoring the affixing of markings under 
                paragraph (2).
                    ``(D) Inspect as the Secretary determines is 
                necessary the warehouses and other facilities of other 
                parties in the chain of custody of qualifying drugs.
                    ``(E) Determine whether the exporter is in 
                compliance with all other registration conditions.
            ``(4) Certain duties relating to importers.--Duties of the 
        Secretary with respect to an importer include the following:
                    ``(A) As authorized under section 704, inspect not 
                less than every 3 weeks, the places of business of the 
                importer that relate to the receipt and distribution of 
                a qualifying drug, including each warehouse or other 
                facility owned or controlled by, or operated for, the 
                importer at which qualifying drugs are received or from 
                which they are distributed to pharmacies.
                    ``(B) During the inspections under subparagraph 
                (A), verify the chain of custody of a statistically 
                significant sample of qualifying drugs from the 
                establishment in which the drug was manufactured to the 
                importer, which may be accomplished by the use of 
                anticounterfeiting or track-and-trace technologies, if 
                available.
                    ``(C) Inspect as the Secretary determines is 
                necessary the warehouses and other facilities of other 
                parties in the chain of custody of qualifying drugs.
                    ``(D) Determine whether the importer is in 
                compliance with all other registration conditions.
    ``(e) Importer Fees.--
            ``(1) Registration fee.--A registration condition is that 
        the importer involved pays to the Secretary a fee of $10,000 
        due on the date on which the importer first submits the 
        registration to the Secretary under subsection (b).
            ``(2) Inspection fee.--A registration condition is that the 
        importer involved pays to the Secretary in accordance with this 
        subsection a fee on a semiannual basis, with the first fee due 
        on the date that is 6 months after the date on which the 
        registration of the importer under subsection (b) is first 
        approved by the Secretary.
            ``(3) Amount of inspection fee.--
                    ``(A) Aggregate total of fees.--The Secretary shall 
                ensure that the aggregate total of fees collected under 
                paragraph (2) for a fiscal year from all importers is 
                sufficient, and no more than necessary, to pay the 
                costs of administering this section with respect to 
                registered importers for a fiscal year, including--
                            ``(i) inspection of the facilities of 
                        importers under subsection (d)(4);
                            ``(ii) reviewing qualifying drugs offered 
                        for import to importers; and
                            ``(iii) determining the compliance of 
                        importers with registration conditions.
                    ``(B) Limitation.--The aggregate total of fees 
                collected under paragraph (2) shall not exceed 1 
                percent of the total price of drugs imported annually 
                to the United States by registered importers under this 
                section.
                    ``(C) Individual importer fee.--Subject to the 
                limitation described in subparagraph (B), a fee under 
                paragraph (2) for an importer shall be an amount that 
                is a reasonable estimate by the Secretary of the 
                semiannual share of the importer of the volume of drugs 
                imported by importers under this section.
                    ``(D) Adjustment of fee.--The Secretary shall 
                annually adjust the fees under paragraph (2) to ensure 
                that the fees accurately reflect the actual costs 
                referred to in subparagraph (A) and do not exceed, in 
                the aggregate, 1 percent of the total price of drugs 
                imported annually to the United States under this 
                section.
            ``(4) Use of fees.--Subject to appropriations Acts, fees 
        collected by the Secretary under paragraphs (1) and (2) are 
        available only to the Secretary and are for the sole purpose of 
        paying the costs referred to in paragraph (3)(A).
    ``(f) Exporter Fees.--
            ``(1) Registration fee.--A registration condition is that 
        the exporter involved pays to the Secretary a fee of $10,000 
        due on the date on which the exporter first submits that 
        registration to the Secretary under subsection (b).
            ``(2) Inspection fee.--A registration condition is that the 
        exporter involved pays to the Secretary in accordance with this 
        subsection a fee on a semiannual basis, with the first fee due 
        on the date that is 6 months after the date on which the 
        registration of the exporter under subsection (b) is first 
        approved by the Secretary.
            ``(3) Amount of inspection fee.--
                    ``(A) Aggregate total of fees.--The Secretary shall 
                ensure that the aggregate total of fees collected under 
                paragraph (2) for a fiscal year from all exporters is 
                sufficient, and not more than necessary, to pay the 
                costs of administering this section with respect to 
                registered exporters for a fiscal year, including--
                            ``(i) monitoring foreign facilities under 
                        subsection (d);
                            ``(ii) developing, implementing, and 
                        maintaining under such subsection a system to 
                        mark shipments to indicate compliance with all 
                        registration conditions; and
                            ``(iii) conducting under such subsection 
                        inspections within the United States to 
determine compliance with conditions under subsections (h) and (i).
                    ``(B) Limitation.--The aggregate total of fees 
                collected under paragraph (2) shall not exceed 1 
                percent of the total price of drugs imported annually 
                to the United States by registered exporters under this 
                section.
                    ``(C) Individual exporter fee.--Subject to the 
                limitation described in subparagraph (B), a fee under 
                paragraph (2) for an exporter shall be an amount that 
                is a reasonable estimate by the Secretary of the 
                semiannual share of the exporter of the volume of drugs 
                exported by exporters under this section.
                    ``(D) Adjustment of fee.--The Secretary shall 
                annually adjust the fees under paragraph (2) to ensure 
                that the fees accurately reflect the actual costs 
                referred to in subparagraph (A) and do not exceed, in 
                the aggregate, 1 percent of the total price of drugs 
                imported annually to the United States under this 
                section.
            ``(4) Use of fees.--Subject to appropriations Acts, fees 
        collected by the Secretary under paragraphs (1) and (2) are 
        only available to the Secretary and are for the sole purpose of 
        paying the costs referred to in paragraph (3)(A).
    ``(g) Compliance With Section 801(a).--
            ``(1) In general.--A registration condition is that each 
        qualifying drug exported under subsection (a) by the registered 
        exporter involved or imported under subsection (a) by the 
        registered importer involved is in compliance with the 
        standards referred to in section 801(a) regarding admission of 
        the drug into the United States, subject to paragraphs (2), 
        (3), and (4).
            ``(2) Section 505; approval status.--
                    ``(A) In general.--For purposes of administrative 
                and judicial procedure, there is a presumption that a 
                drug proposed for export or import under subsection (a) 
                is an approved drug under section 505(b) if the 
                following criteria are met:
                            ``(i) The drug proposed for export or 
                        import is in compliance with subsection (c).
                            ``(ii) The drug proposed for export or 
                        import has the same active ingredient or 
                        ingredients, route of administration, dosage 
                        form, and strength, according to information 
                        provided by the labeling of the drug proposed 
                        for export or import, as a drug (referred to in 
                        this subsection as a `U.S. label drug') that--
                                    ``(I) is manufactured by or for the 
                                person that manufactures the drug 
                                proposed for export or import; and
                                    ``(II) is approved under section 
                                505(b).
                    ``(B) Importation.--Subject to subparagraphs (D) 
                and (E), a drug meeting the criteria described in 
                subparagraph (A) may, in accordance with the other 
                subsections of this section, be imported into the 
                United States.
                    ``(C) Notice by manufacturer; general provisions.--
                            ``(i) In general.--The person that 
                        manufactures a drug that may be imported under 
                        subsection (a) shall in accordance with this 
                        paragraph submit to the Secretary a notice 
                        that--
                                    ``(I) includes each difference in 
                                the drug from a condition established 
                                in the approved application for the 
                                U.S. label drug beyond the variations 
                                provided for in the application, any 
                                difference in labeling, the date on 
                                which the drug with such difference 
                                was, or will be, introduced for 
                                commercial distribution in a permitted 
                                country, and such additional 
                                information as the Secretary may 
                                require; or
                                    ``(II) states that there is no 
                                difference in the drug from a condition 
                                established in the approved application 
                                for the U.S. label drug beyond the 
                                variations provided for in the 
                                application and differences in 
                                labeling.
                            ``(ii) Information regarding foreign 
                        government.--A notice under clause (i)(I) shall 
                        with respect to the permitted country that 
                        approved the drug for commercial distribution, 
                        or with respect to which such approval is 
                        sought, include the following:
                                    ``(I) Information demonstrating 
                                that the person submitting the notice 
                                has also notified the government of the 
                                permitted country in writing that the 
                                person is submitting to the Secretary a 
                                notice under clause (i)(I), which 
                                notice describes the difference in the 
                                drug from a condition established in 
                                the approved application for the U.S. 
                                label drug.
                                    ``(II) The information that the 
                                person submitted or will submit to the 
                                government of the permitted country for 
                                purposes of obtaining approval for 
                                commercial distribution of the drug in 
                                the country which, if in a language 
                                other than English, shall be 
                                accompanied by an English translation 
                                verified to be complete and accurate, 
                                with the name, address, and a brief 
                                statement of the qualifications of the 
                                person that made the translation.
                            ``(iii) Certifications.--The chief 
                        executive officer and the chief medical officer 
                        of the manufacturer involved shall each certify 
                        in the notice under clause (i) that--
                                    ``(I) the information provided in 
                                the notice is complete and true; and
                                    ``(II) a copy of the notice has 
                                been provided to the Federal Trade 
                                Commission and to the Assistant 
                                Attorney General in charge of the 
                                Antitrust Division of the Department of 
                                Justice (referred to in this subsection 
                                as the `Assistant Attorney General').
                            ``(iv) Fee.--If a notice submitted under 
                        clause (i) includes a difference that would, 
                        under section 506A, require the submission of a 
                        supplemental application if made as a change to 
                        the U.S. label drug, the person that submits 
                        the notice shall pay to the Secretary a fee in 
                        the same amount as would apply if the person 
                        were paying a fee pursuant to section 
                        736(a)(1)(A)(ii). Subject to appropriations 
                        Acts, fees collected by the Secretary under the 
                        preceding sentence are available only to the 
                        Secretary and are for the sole purpose of 
                        paying the costs of reviewing notices submitted 
                        under clause (i).
                            ``(v) Timing of submission of notices.--
                                    ``(I) Prior approval notices.--A 
                                notice under clause (i) to which 
                                subparagraph (D) applies shall be 
                                submitted to the Secretary not later 
                                than 120 days before the drug with the 
                                difference is introduced for commercial 
                                distribution in a permitted country, 
                                unless the country requires that 
                                distribution of the drug with the 
                                difference begin less than 120 days 
                                after the country requires the 
                                difference.
                                    ``(II) Other approval notices.--A 
                                notice under clause (i) to which 
                                subparagraph (E) applies shall be 
                                submitted to the Secretary not later 
                                than the day on which the drug with the 
                                difference is introduced for commercial 
                                distribution in a permitted country.
                                    ``(III) Other notices.--A notice 
                                under clause (i) to which subparagraph 
                                (F) applies shall be submitted to the 
                                Secretary on the date that the drug is 
                                first introduced for commercial 
                                distribution in a permitted country and 
                                annually thereafter.
                            ``(vi) Review by secretary.--
                                    ``(I) In general.--In this 
                                paragraph, the difference in a drug 
                                that may be imported under subsection 
                                (a) from the U.S. label drug shall be 
                                treated by the Secretary as if it was a 
                                manufacturing change to the U.S. label 
                                drug under section 506A.
                                    ``(II) Review by the secretary.--
                                The Secretary shall review and approve 
                                or disapprove the difference in a 
                                notice submitted under clause (i), if 
                                required under section 506A, not later 
                                than 120 days after the date on which 
                                the notice is submitted.
                                    ``(III) Establishment inspection.--
                                If review of such difference would 
                                require an inspection by the Secretary 
                                of the establishment in which the drug 
                                is manufactured, such inspection shall 
                                be authorized by section 704.
                            ``(vii) Publication of information on 
                        notices.--
                                    ``(I) In general.--Through the 
                                Internet website of the Food and Drug 
                                Administration, the Secretary shall 
                                readily make available to the public a 
                                list of notices submitted under clause 
                                (i).
                                    ``(II) Contents.--The list under 
                                subclause (I) shall include the date on 
                                which a notice is submitted and 
                                whether--
                                            ``(aa) a notice is under 
                                        review;
                                            ``(bb) the Secretary has 
                                        ordered that importation of the 
                                        drug from a permitted country 
                                        cease; or
                                            ``(cc) the importation of 
                                        the drug is permitted under 
                                        subsection (a).
                                    ``(III) Update.--The Secretary 
                                shall promptly update the Internet 
                                website with any changes to the list.
                    ``(D) Notice; drug difference requiring prior 
                approval.--In the case of a notice under subparagraph 
                (C)(i) that includes a difference that would, under 
                section 506A(c) or (d)(3)(B)(i), require the approval 
                of a supplemental application before the difference 
                could be made to the U.S. label drug the following 
                shall occur:
                            ``(i) Promptly after the notice is 
                        submitted, the Secretary shall notify 
                        registered exporters, registered importers, the 
                        Federal Trade Commission, and the Assistant 
                        Attorney General that the notice has been 
                        submitted with respect to the drug involved.
                            ``(ii) If the Secretary has not made a 
                        determination whether a supplemental 
                        application regarding the U.S. label drug would 
                        be approved or disapproved by the date on which 
                        the drug involved is to be introduced for 
                        commercial distribution in a permitted country, 
                        the Secretary shall--
                                    ``(I) order that the importation of 
                                the drug involved from the permitted 
                                country cease for the period in 
which the Secretary completes review of the notice; and
                                    ``(II) promptly notify registered 
                                exporters, registered importers, the 
                                Federal Trade Commission, and the 
                                Attorney General of the order.
                            ``(iii) If the Secretary determines that 
                        such a supplemental application regarding the 
                        U.S. label drug would not be approved, the 
                        Secretary shall--
                                    ``(I) order that the importation of 
                                the drug involved from the permitted 
                                country cease, or provide that an order 
                                under clause (ii), if any, remains in 
                                effect;
                                    ``(II) notify the permitted country 
                                that approved the drug for commercial 
                                distribution of the determination; and
                                    ``(III) promptly notify registered 
                                exporters, registered importers, the 
                                Federal Trade Commission, and the 
                                Assistant Attorney General of the 
                                determination.
                            ``(iv) If the Secretary determines that 
                        such a supplemental application regarding the 
                        U.S. label drug would be approved, the 
                        Secretary shall vacate the order under clause 
                        (ii), if any, permit importation of the drug 
                        under subsection (a), and promptly notify 
                        registered exporters, registered importers, the 
                        Federal Trade Commission, and the Assistant 
                        Attorney General of the determination.
                    ``(E) Notice; drug difference not requiring prior 
                approval.--In the case of a notice under subparagraph 
                (C)(i) that includes a difference that would, under 
                section 506A(d)(3)(B)(ii), not require the approval of 
                a supplemental application before the difference could 
                be made to the U.S. label drug the following shall 
                occur:
                            ``(i) During the period in which the notice 
                        is being reviewed by the Secretary, the 
                        authority under this subsection to import the 
                        drug involved continues in effect.
                            ``(ii) If the Secretary determines that 
                        such a supplemental application regarding the 
                        U.S. label drug would not be approved, the 
                        Secretary shall order that the importation of 
                        the drug involved from the permitted country 
                        cease, shall notify the permitted country that 
                        approved the drug for commercial distribution 
                        of the determination, and shall promptly notify 
                        registered exporters, registered importers, the 
                        Federal Trade Commission, and the Assistant 
                        Attorney General of the determination.
                    ``(F) Notice; drug difference not requiring 
                approval; no difference.--In the case of a notice under 
                subparagraph (C)(i) that includes a difference for 
                which, under section 506A(d)(1)(A), a supplemental 
                application would not be required for the difference to 
                be made to the U.S. label drug, or that states that 
                there is no difference, the Secretary--
                            ``(i) may not order that the importation of 
                        the drug involved cease; and
                            ``(ii) shall promptly notify registered 
                        exporters and registered importers.
                    ``(G) Differences in active ingredient, route of 
                administration, dosage form, or strength.--
                            ``(i) In general.--A person who 
                        manufactures a U.S. label drug shall submit an 
                        application under section 505(b) for a drug 
                        that is manufactured for distribution in a 
                        permitted country by or for the person that 
                        manufactures the U.S. label drug if--
                                    ``(I) there is no drug for export 
                                from at least half of the permitted 
                                countries with the same active 
                                ingredient or ingredients, route of 
                                administration, dosage form, and 
                                strength as the U.S. label drug; and
                                    ``(II) each active ingredient of 
                                the drug is related to an active 
                                ingredient of the U.S. label drug, as 
                                defined in clause (v).
                            ``(ii) Application under section 505(b).--
                        The application under section 505(b) required 
                        under clause (i) shall--
                                    ``(I) request approval of the drug 
                                for the indication or indications for 
                                which the U.S. label drug is approved 
                                under section 505;
                                    ``(II) include the information that 
                                the person submitted to the government 
                                of the permitted country for purposes 
                                of obtaining approval for commercial 
                                distribution of the drug in that 
                                country, which if in a language other 
                                than English, shall be accompanied by 
                                an English translation verified to be 
                                complete and accurate, with the name, 
                                address, and a brief statement of the 
                                qualifications of the person that made 
                                the translation;
                                    ``(III) include a right of 
                                reference to the application under 
                                section 505(b) for the U.S. label drug; 
                                and
                                    ``(IV) include such additional 
                                information as the Secretary may 
                                require.
                            ``(iii) Timing of submission of 
                        application.--An application under section 
                        505(b) required under clause (i) shall be 
                        submitted to the Secretary not later than the 
                        day on which the information referred to in 
                        clause (ii)(II) is submitted to the government 
                        of the permitted country.
                            ``(iv) Notice of decision on application.--
                        The Secretary shall promptly notify registered 
                        exporters, registered importers, the Federal 
                        Trade Commission, and the Assistant Attorney 
                        General of a determination to approve or to 
                        disapprove an application under section 505(b) 
                        required under clause (i).
                            ``(v) Related active ingredients.--For 
                        purposes of clause (i)(II), 2 active 
                        ingredients are related if they are--
                                    ``(I) the same; or
                                    ``(II) different salts, esters, or 
                                complexes of the same moiety.
            ``(3) Section 502; labeling.--
                    ``(A) Importation by registered importer.--
                            ``(i) In general.--In the case of a 
                        qualifying drug that is imported or offered for 
                        import by a registered importer, such drug 
                        shall be considered to be in compliance with 
                        section 502 if the drug bears--
                                    ``(I) a copy of the labeling 
                                approved for the drug under section 
                                505, without regard to whether the copy 
                                bears the trademark involved;
                                    ``(II) the name of the manufacturer 
                                and location of the manufacturer;
                                    ``(III) the lot number assigned by 
                                the manufacturer; and
                                    ``(IV) the name, location, and 
                                registration number of the importer.
                            ``(ii) Request for copy of the labeling.--
                        The Secretary shall provide such copy to the 
                        registered importer involved, upon request of 
                        the importer.
                    ``(B) Importation by individual.--In the case of a 
                qualifying drug that is imported or offered for import 
                by a registered exporter to an individual, such drug 
                shall be considered to be in compliance with section 
                502 if the drug bears a label providing the directions 
                for use by the consumer, and bears a copy of any 
                special labeling that would be required by the 
                Secretary had the drug been dispensed by a pharmacist 
                in the United States, without regard to whether the 
                special labeling bears the trademark involved. The 
                Secretary shall provide to the registered exporter 
                involved a copy of the special labeling, upon request 
                of the exporter.
            ``(4) Section 501; standards for refusing admission.--
                    ``(A) In general.--For purposes of administrative 
                and judicial procedure, there is a presumption that a 
                drug proposed for export or import under subsection (a) 
                is in compliance with section 501 if the drug is in 
                compliance with subsection (c).
                    ``(B) Standards for refusing admission.--A 
                qualifying drug exported under subsection (a) from a 
                registered exporter or imported by a registered 
                importer may be refused admission into the United 
                States if 1 or more of the following applies:
                            ``(i) The shipping container appears 
                        damaged in a way that may affect the strength, 
                        quality, or purity of the drug.
                            ``(ii) The Secretary becomes aware that--
                                    ``(I) the drug may be counterfeit;
                                    ``(II) the drug may have been 
                                prepared, packed, or held under 
                                insanitary conditions; or
                                    ``(III) the methods used in, or the 
                                facilities or controls used for, the 
                                manufacturing, processing, packing, or 
                                holding of the drug do not conform to 
                                good manufacturing practice.
                            ``(iii) The Secretary has obtained an 
                        injunction under section 302 that prohibits the 
                        distribution of the drug in interstate 
                        commerce.
                            ``(iv) The Secretary has under section 
                        505(e) withdrawn approval of the drug.
                            ``(v) The manufacturer of the drug has 
                        instituted a recall of the drug.
                            ``(vi) If the qualifying drug is exported 
                        from a registered exporter to an individual and 
                        1 or more of the following applies:
                                    ``(I) The shipping container for 
                                such drug does not bear the markings 
                                required under subsection (d)(2).
                                    ``(II) The markings on the shipping 
                                container appear to be counterfeit.
                                    ``(III) The shipping container or 
                                markings appear to have been tampered 
                                with.
    ``(h) Licensing as Pharmacist.--A registration condition is that 
the exporter involved agrees that a qualifying drug will be exported to 
an individual only if the Secretary has verified that--
            ``(1) the exporter is authorized under Canadian law to 
        dispense prescription drugs; and
            ``(2) the exporter employs persons that are licensed under 
        Canadian law to dispense prescription drugs in sufficient 
        number to dispense safely the qualifying drugs exported by the 
        exporter to individuals, and the exporter assigns to those 
        persons responsibility for dispensing such qualifying drugs to 
        individuals.
    ``(i) Individuals; Conditions for Importation From Canada.--
            ``(1) In general.--For purposes of subsection (a)(2)(B), 
        the importation of a qualifying drug by an individual is in 
        accordance with this subsection if the following conditions are 
        met:
                    ``(A) The drug is accompanied by a copy of a 
                prescription for the drug, which prescription--
                            ``(i) is valid under applicable Federal and 
                        State laws; and
                            ``(ii) was issued by a practitioner who, 
                        under the law of a State of which the 
                        individual is a resident, or in which the 
                        individual receives care from the practitioner 
                        who issues the prescription, is authorized to 
                        administer prescription drugs.
                    ``(B) The drug is accompanied by a copy of the 
                documentation that was required under the law or 
                regulations of Canada as a condition of dispensing the 
                drug to the individual.
                    ``(C) The copies referred to in subparagraphs 
                (A)(i) and (B) are marked in a manner sufficient--
                            ``(i) to indicate that the prescription, 
                        and the equivalent document in Canada, have 
                        been filled; and
                            ``(ii) to prevent a duplicative filling by 
                        another pharmacist.
                    ``(D) The individual has provided to the registered 
                exporter a complete list of all drugs used by the 
                individual for review by the individuals who dispense 
                the drug.
                    ``(E) The quantity of the drug does not exceed a 
                90-day supply.
                    ``(F) The drug is not an ineligible subpart H drug. 
                For purposes of this section, a prescription drug is an 
                `ineligible subpart H drug' if the drug was approved by 
                the Secretary under subpart H of part 314 of title 21, 
                Code of Federal Regulations (relating to accelerated 
                approval), with restrictions under section 520 of such 
                part to assure safe use, and the Secretary has 
                published in the Federal Register a notice that the 
                Secretary has determined that good cause exists to 
                prohibit the drug from being imported pursuant to this 
                subsection.
            ``(2) Notice regarding drug refused admission.--If a 
        registered exporter ships a drug to an individual pursuant to 
        subsection (a)(2)(B) and the drug is refused admission to the 
        United States, a written notice shall be sent to the individual 
        and to the exporter that informs the individual and the 
        exporter of such refusal and the reason for the refusal.
    ``(j) Maintenance of Records and Samples.--A registration condition 
is that the importer or exporter involved shall--
            ``(1) maintain records required under this section for not 
        less than 2 years; and
            ``(2) maintain samples of each lot of a drug required under 
        this section for not less than 2 years.
    ``(k) Drug Recalls.--
            ``(1) Manufacturers.--A person that manufactures a 
        prescription drug imported from a permitted country under this 
        section shall promptly inform the Secretary--
                    ``(A) if the drug is recalled or withdrawn from the 
                market in a permitted country;
                    ``(B) how the drug may be identified, including lot 
                number; and
                    ``(C) the reason for the recall or withdrawal.
            ``(2) Secretary.--With respect to each permitted country, 
        the Secretary shall--
                    ``(A) enter into an agreement with the government 
                of the country to receive information about recalls and 
                withdrawals of prescription drugs in the country; or
                    ``(B) monitor recalls and withdrawals of 
                prescription drugs in the country using any information 
                that is available to the public in any media.
            ``(3) Notice.--The Secretary may notify, as appropriate, 
        registered exporters, registered importers, wholesalers, 
        pharmacies, or the public of a recall or withdrawal of a 
        prescription drug in a permitted country.''.
    (b) Prohibited Acts.--The Federal Food, Drug, and Cosmetic Act is 
amended--
            (1) in section 301 (21 U.S.C. 331), by striking paragraph 
        (aa) and inserting the following:
    ``(aa)(1) The sale or trade by a pharmacist, or by a business 
organization of which the pharmacist is a part, of a qualifying drug 
that under section 804(a)(2)(A) was imported by the pharmacist, other 
than--
            ``(A) a sale at retail made pursuant to dispensing the drug 
        to a customer of the pharmacist or organization; or
            ``(B) a sale or trade of the drug to a pharmacy or a 
        wholesaler registered to import drugs under section 804.
    ``(2) The sale or trade by an individual of a qualifying drug that 
under section 804(a)(2)(B) was imported by the individual.
    ``(3) The making of a materially false, fictitious, or fraudulent 
statement or representation, or a material omission, in a notice under 
clause (i) of section 804(g)(2)(C) or in an application required under 
section 804(g)(2)(G), or the failure to submit such a notice or 
application.
    ``(4) The importation of a drug in violation of a requirement under 
section 804.''; and
            (2) in section 303(a) (21 U.S.C. 333(a)), by striking 
        paragraph (6) and inserting the following:
    ``(6) Notwithstanding subsection (a), any person that knowingly 
violates section 301(aa) (3) or (4) shall be imprisoned not more than 
10 years, or fined in accordance with title 18, United States Code, or 
both.''.
    (c) Implementation.--
            (1) Rulemaking.--
                    (A) In general.--
                            (i) Promulgation by secretary.--Not later 
                        than 90 days after the date of the enactment of 
                        this Act, the Secretary of Health and Human 
                        Services shall promulgate an interim rule for 
                        implementing section 804 of the Federal Food, 
                        Drug, and Cosmetic Act, as added by subsection 
                        (a) of this section. Such rule shall be 
                        developed and promulgated by the Secretary 
                        without providing general notice of proposed 
                        rulemaking. Not later than 1 year after the 
date on which the interim rule is promulgated, the Secretary shall, in 
accordance with procedures under section 553 of title 5, United States 
Code, promulgate a final rule for implementing such section 804, which 
may incorporate by reference provisions of the interim rule, to the 
extent that such provisions are not modified.
                            (ii) Effect of rules.--The rules 
                        promulgated under clause (i) shall permit the 
                        importation of prescription drugs--
                                    (I) from registered exporters by 
                                individuals effective on the date of 
                                the promulgation of the interim rule;
                                    (II) from Canada by registered 
                                importers effective on the date of the 
                                promulgation of the interim rule; and
                                    (III) from Australia, a member 
                                country of the European Union as of 
                                January 1, 2003, Japan, New Zealand, or 
                                Switzerland by registered importers on 
                                the date that is 1 year after the date 
                                of the enactment of this Act.
                    (B) Certain exporters.--The interim rule under 
                subparagraph (A) shall provide that, in the review of 
                registrations submitted under subsection (b) of the 
                section 804 referred to in such subparagraph, 
                registrations submitted by entities in Canada that are 
                significant exporters of prescription drugs to 
                individuals in the United States as of the date of the 
                enactment of this Act will have priority during the 
                period in which the interim rule under subparagraph (A) 
                is in effect. During such period, the reference in 
                subsection (b)(2)(A) of such section 804 to 90 days 
                (relating to approval or disapproval of registrations) 
                is, as applied to such entities, deemed to be 30 days.
                    (C) Drugs for import from canada.--The notices with 
                respect to drugs to be imported from Canada that are 
                required under subsection (g)(2)(C)(i)(I) of such 
                section 804 and that require approval under subsection 
                (g)(2)(D) or (E) of such section 804 shall be submitted 
                to the Secretary not later than 30 days after the date 
                of enactment of this Act. The notices with respect to 
                drugs to be imported from Canada that are required 
                under subsection (g)(2)(C)(i) of such section 804 and 
                that do not require approval under subsection (g)(2)(D) 
                or (E) of such section 804 shall be submitted to the 
                Secretary not later than 90 days after the date of 
                enactment of this Act.
                    (D) Drugs for import from other countries.--The 
                notices with respect to drugs to be imported from 
                Australia, a member country of the European Union as of 
                January 1, 2003, Japan, New Zealand, or Switzerland 
                that are required under subsection (g)(2)(C)(i)(I) of 
                such section 804 and that require approval under 
                subsection (g)(2)(D) or (E) of such section 804 shall 
                be submitted to the Secretary not later than 180 days 
                after the date of enactment of this Act. The notices 
                with respect to drugs to be imported from such 
                countries that are required under subsection 
                (g)(2)(C)(i)(II) of such section 804 and that do not 
                require approval under subsection (g)(2)(D) or (E) of 
                such section 804 shall be submitted to the Secretary 
                not later than 270 days after the date of enactment of 
                this Act.
            (2) Personal importation from canada.--Until the expiration 
        of the 60-day period beginning on the date on which the interim 
        rule under paragraph (1)(A) is promulgated, an individual may 
        import a prescription drug from Canada for personal use or for 
        the use of a family member of the individual (rather than for 
        resale), subject to compliance with the following conditions:
                    (A) The drug is not--
                            (i) a controlled substance, as defined in 
                        section 102 of the Controlled Substances Act 
                        (21 U.S.C. 802);
                            (ii) a biological product, as defined in 
                        section 351 of the Public Health Service Act 
                        (42 U.S.C. 262);
                            (iii) an infused drug, including a 
                        peritoneal dialysis solution;
                            (iv) an intravenously injected drug;
                            (v) a drug that is inhaled during surgery; 
                        or
                            (vi) a drug approved by the Secretary under 
                        subpart H of part 314 of title 21, Code of 
                        Federal Regulations (relating to accelerated 
                        approval) with restrictions under section 520 
                        of such part to assure safe use.
                    (B) The drug is dispensed by a person licensed in 
                Canada to dispense such drugs.
                    (C) The drug is accompanied by a copy of the 
                prescription for the drug, which prescription--
                            (i) is valid under applicable Federal and 
                        State laws; and
                            (ii) was issued by a practitioner who, 
                        under the law of a State of which the 
                        individual is a resident, or in which the 
                        individual receives care from the practitioner 
                        who issues the prescription, is authorized to 
                        administer prescription drugs.
                    (D) The drug is accompanied by a copy of the 
                document that was required in Canada as a condition of 
                dispensing the drug to the individual.
                    (E) The copies referred to in subparagraphs (C) and 
                (D) are marked in a manner sufficient--
                            (i) to indicate that the prescription, and 
                        the equivalent document in Canada, have been 
                        filled; and
                            (ii) to prevent a duplicative filling by 
                        another pharmacist.
                    (F) The quantity of the drug does not exceed a 90-
                day supply.
            (3) Facilitation of canadian imports.--Not less than 15 
        days after the enactment of this Act and until the expiration 
        of the 60-day period that begins on the date on which the 
        interim rule under paragraph (1)(A) is promulgated, the 
        Secretary shall, through the Internet website of the Food and 
        Drug Administration, make readily available to the public a 
        list of persons licensed in Canada to dispense prescription 
        drugs who are willing to export drugs under paragraph (2) to 
        individuals in the United States.
            (4) Effect of provisions.--The amendments made in 
        subsection (d), section 6, and section 7 of this Act shall have 
        no effect with respect to imports made under paragraph (2).
    (d) Amendment of Certain Provision.--Section 801 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 381) is amended by striking 
subsection (g) and inserting the following:
    ``(g) With respect to a prescription drug that is imported or 
offered for import into the United States by an individual who is not 
in the business of such importation, that is not shipped by a 
registered exporter under section 804, and that is refused admission 
under subsection (a), the Secretary shall notify the individual that--
            ``(1) the drug has been refused admission because the drug 
        was not a lawful import under section 804;
            ``(2) the drug is not otherwise subject to a waiver of the 
        requirements of subsection (a);
            ``(3) the individual may under section 804 lawfully import 
        certain prescription drugs from Canadian exporters registered 
        with the Secretary; and
            ``(4) the individual can find information about such 
        importation, including a list of registered exporters, on the 
        Internet website of the Food and Drug Administration.''.
    (e) Anticompetitive Practices Relating to Importing and Exporting 
Drugs to the United States.--
            (1) In general.--The Clayton Act (15 U.S.C. 12 et seq.) is 
        amended by adding at the end the following:

``SEC. 27. RESTRAINT OF TRADE REGARDING PRESCRIPTION DRUGS.

    ``(a) In General.--It shall be unlawful for any person engaged in 
commerce, directly or indirectly to--
            ``(1) charge a higher price for prescription drugs sold to 
        a registered exporter or other person that exports prescription 
        drugs to the United States under section 804 of the Federal 
        Food, Drug, and Cosmetic Act than the price that is charged to 
        another person that is in the same country and that does not 
        export prescription drugs into the United States under section 
        804 of such Act;
            ``(2) charge a higher price for prescription drugs sold to 
        a registered importer or other person that distributes, sells, 
        or uses prescription drugs imported to the United States under 
        section 804 of such Act than the price that is charged to 
        another person in the United States that does not import 
        prescription drugs under section 804 of such Act, or that does 
        not distribute, sell, or use such drugs;
            ``(3) deny supplies of prescription drugs to a registered 
        exporter or other person that exports prescription drugs to the 
        United States under section 804 of such Act or to a registered 
        importer or other person that distributes, sells, or uses 
        prescription drugs imported to the United States under section 
        804 of such Act;
            ``(4) publicly, privately, or otherwise refuse to do 
        business with a registered exporter or other person that 
        exports prescription drugs to the United States under section 
        804 of such Act or with a registered importer or other person 
        that distributes, sells, or uses prescription drugs imported to 
        the United States under section 804 of such Act;
            ``(5) specifically restrict supplies of prescription drugs 
        to a registered exporter or other person that exports 
        prescription drugs to the United States under section 804 of 
        such Act or to a registered importer or other person that 
        distributes, sells, or uses prescription drugs imported to the 
        United States under section 804 of such Act;
            ``(6) fail to submit a notice under subsection (g)(2)(C)(i) 
        of section 804 of such Act, fail to submit such a notice on or 
        before the date specified in subsection (g)(2)(C)(v) of section 
        804 of such Act, submit such a notice that makes a materially 
        false, fictitious, or fraudulent statement, or fail to provide 
        promptly any information requested by the Secretary of Health 
        and Human Services to review such a notice;
            ``(7) fail to submit an application required under 
        subsection (g)(2)(G) of section 804 of such Act, fail to submit 
        such an application on or before the date specified in 
        subsection (g)(2)(G)(ii) of section 804 of such Act, submit 
        such an application that makes a materially false, fictitious, 
        or fraudulent statement, or fail to provide promptly any 
        information requested by the Secretary of Health and Human 
        Services to review such an application;
            ``(8) cause there to be a difference (including a 
        difference in active ingredient, route of administration, 
        dosage form, strength, formulation, manufacturing 
        establishment, manufacturing process, or person that 
        manufactures the drug) between a prescription drug for 
        distribution in the United States and a prescription drug for 
        distribution in Australia, Canada, a member country of the 
        European Union as of January 1, 2003, Japan, New Zealand, or 
        Switzerland for the purpose of restricting importation of the 
        drug to the United States under section 804 of such Act;
            ``(9) refuse to allow an inspection authorized under 
        section 804 of such Act of an establishment that manufactures a 
        prescription drug that is offered for import under such 
        section;
            ``(10) fail to conform to the methods used in, or the 
        facilities used for, the manufacturing, processing, packing, or 
        holding of a prescription drug offered for import under section 
        804 to good manufacturing practice under such Act; or
            ``(11) engage in any other action that the Federal Trade 
        Commission determines to unfairly restrict competition under 
        section 804 of such Act.
    ``(b) Presumption.--A difference (including a difference in active 
ingredient, route of administration, dosage form, strength, 
formulation, manufacturing establishment, manufacturing process, or 
person that manufactures the drug) between a prescription drug for 
distribution in the United States and a prescription drug for 
distribution in Australia, Canada, a member country of the European 
Union as of January 1, 2003, Japan, New Zealand, or Switzerland made 
after January 1, 2004, shall be presumed to be for the purpose of 
restricting importation of the drug to the United States under section 
804 of the Federal Food, Drug, and Cosmetic Act unless--
            ``(1) the person manufacturing the drug for distribution in 
        the United States proves that the difference was required by 
        the country in which the drug is distributed;
            ``(2) the Secretary of Health and Human Services, acting 
        through the Commissioner of Food and Drug, determines that the 
        difference was necessary to improve the safety or efficacy of 
        the drug; or
            ``(3) the person manufacturing the drug for distribution in 
        the United States has given notice to the Secretary of Health 
        and Human Services under subsection (g)(2)(C)(i) of section 804 
        of such Act that the drug for distribution in the United States 
        is not different from a drug for distribution in not fewer than 
        half of those countries.
    ``(c) Affirmative Defense.--It shall be an affirmative defense to a 
charge that a person has violated paragraph (1), (2), (3), (4), or (5) 
of subsection (a) that the higher prices charged for prescription drugs 
sold to a person, the denial of supplies of prescription drugs to a 
person, the refusal to do business with a person, or the specific 
restriction or delay of supplies to a person is not based, in whole or 
in part, on--
            ``(1) the person exporting or importing prescription drugs 
        to the United States under section 804 of the Federal Food, 
        Drug, and Cosmetic Act; or
            ``(2) the person distributing, selling, or using 
        prescription drugs imported to the United States under section 
        804 of such Act.
    ``(d) Definitions.--In this section:
            ``(1) Prescription drug.--The term `prescription drug' 
        means a drug that is described in section 503(b)(1) of the 
        Federal Food, Drug, and Cosmetic Act (21 U.S.C. 353(b)(1)).
            ``(2) Registered importer.--The term `registered importer' 
        has the meaning given such term in section 804 of the Federal 
        Food, Drug, and Cosmetic Act.
            ``(3) Registered exporter.--The term `registered exporter' 
        has the same meaning as in section 804 of the Federal Food, 
        Drug, and Cosmetic Act.''.
            (2) Applicability of amendments to importation under the 
        pharmaceutical market access and fair trade act of 2004.--
                    (A) Personal importation from canada.--Paragraphs 
                (1) through (5) and (11) of subsection (a) of section 
                27 of the Clayton Act (15 U.S.C. et seq.) (as amended 
                by paragraph (1)) shall apply with respect to the 
                importation of drugs from Canada under subsection 
                (c)(2).
                    (B) Notices respecting drug for import.--Paragraph 
                (6) of subsection (a) of section 27 of the Clayton Act 
                (15 U.S.C. et seq.) (as amended by paragraph (1)) shall 
                apply with respect to notices required under section 
                804(g)(2)(C)(i) of the Federal Food Drug and Cosmetic 
                Act (21 U.S.C. 384(g)(2)(C)(i)) that are not submitted 
                by the dates required under subsections (c)(1)(C) and 
                (D).
    (f)  Exhaustion.--
            (1) In general.--Section 271 of title 35, United States 
        Code, is amended--
                    (A) by redesignating subsections (h) and (i) as (i) 
                and (j), respectively; and
                    (B) by inserting after subsection (g) the 
                following:
    ``(h) It shall not be an act of infringement to use, offer to sell, 
or sell within the United States or to import into the United States 
any patented invention under section 804 of the Federal Food, Drug, and 
Cosmetic Act that was first sold abroad by or under authority of the 
owner or licensee of such patent.''.
            (2) Rule of construction.--Nothing in the amendment made by 
        paragraph (1) shall be construed to affect the ability of a 
        patent owner or licensee to enforce their patent, subject to 
        such amendment.

SEC. 5. ADDITIONAL WAIVERS REGARDING PERSONAL IMPORTATION; ENFORCEMENT 
              POLICIES OF SECRETARY.

    (a) In General.--Section 801 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 381) is amended by adding at the end the 
following:
    ``(p)(1) Waivers under this subsection are in addition to, and 
independent of, the waiver pursuant to section 804(a)(2)(B).
    ``(2) With respect to the standards referred to in subsection 
(d)(1), the Secretary shall establish by regulation a waiver of such 
standards in the case of the importation by an individual of a drug 
into the United States in the following circumstances:
            ``(A) The drug was dispensed to the individual while the 
        individual was in the United States, the drug was dispensed by 
        a pharmacist or by a practitioner licensed by law to administer 
        the drug, and the individual traveled from the United States 
        with the drug.
            ``(B) The individual is entering the United States and the 
        drug accompanies the individual at the time of entry.
            ``(C) The drug does not appear to the Secretary to be 
        adulterated.
            ``(D) The quantity of the drug does not exceed a 90-day 
        supply.
            ``(E) The drug is accompanied by a statement that the 
        individual seeks to import the drug into the United States 
        under a personal importation waiver.
            ``(F) Such additional standards as the Secretary determines 
        to be appropriate to protect the public health.
    ``(3) With respect to the standards referred to in subsections (a) 
and (d)(1), the Secretary shall establish by regulation a waiver of 
such standards in the case of the importation by an individual of a 
drug into the United States in the following circumstances:
            ``(A) The drug was dispensed to the individual while the 
        individual was in a foreign country, and the drug was dispensed 
        in accordance with the laws and regulations of such country.
            ``(B) The individual is entering the United States and the 
        drug accompanies the individual at the time of entry.
            ``(C) The drug is approved for commercial distribution in 
        the foreign country in which the drug was obtained.
            ``(D) The drug does not appear to the Secretary to be 
        adulterated.
            ``(E) The quantity of the drug does not exceed--
                    ``(i) a 90-day supply if the drug is dispensed in 
                Australia, Canada, a member country of the European 
                Union as of January 1, 2003, Japan, New Zealand, or 
                Switzerland; or
                    ``(ii) a 14-day supply otherwise.
            ``(F) The drug is accompanied by a statement that the 
        individual seeks to import the drug into the United States 
        under a personal importation waiver.
            ``(G) Such additional standards as the Secretary determines 
        to be appropriate to protect the public health.
    ``(q) The Secretary may not administer any enforcement policy that 
has the effect of permitting the importation of a prescription drug 
into the United States in violation of this Act or section 351 of the 
Public Health Service Act.''.
    (b) Additional Waiver.--This Act and the amendments made by this 
Act shall not be construed as limiting the authority of the Secretary 
of Health and Human Services to establish a waiver of the standards 
referred to in section 801(a) of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 381(a)) with respect to the importation by an individual 
of a drug into the United States that does not meet such standards, 
provided that such waiver is no more permissive than the guidance, as 
in effect on January 1, 2004, that is provided in the item numbered 2 
(relating to a specific situation, consisting of conditions (a) through 
(d)) under the heading ``Drugs, Biologics, and Devices'' in chapter 9 
of the FDA/ORA Regulatory Procedures Manual (relating to import 
operations/actions), in the subchapter relating to coverage of personal 
importations.

SEC. 6. DISPOSITION OF CERTAIN DRUGS DENIED ADMISSION INTO UNITED 
              STATES.

    (a) In General.--Chapter VIII of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 381 et seq.), as amended by section 3 of this 
Act, is further amended by adding at the end the following section:

``SEC. 805. DISPOSITION OF CERTAIN DRUGS DENIED ADMISSION.

    ``(a) In General.--The Secretary of Homeland Security shall refuse 
admission to a shipment of drugs that is imported or offered for import 
into the United States if the shipment has a declared value of less 
than $10,000 and the drugs are in violation of any standard referred to 
in section 801(a) or 801(d)(1), including any drugs imported or offered 
for import under enforcement policies prohibited under section 801(q).
    ``(b) Importation Under Section 804.--In the case of a drug that 
under section 804 is imported or offered for import from a registered 
exporter, the reference in subsection (a) to standards referred to in 
section 801(a) or 801(d)(1) shall be considered a reference to 
standards referred to in section 804(g)(4)(B).
    ``(c) Destruction of Violative Shipments.--Drugs refused admission 
under subsection (a) or (b) shall be destroyed, subject to subsection 
(e). Section 801(b) does not authorize the delivery of the drugs 
pursuant to the execution of a bond, and the drugs may not be exported.
    ``(d) Certain Procedures.--
            ``(1) In general.--The refusal of admission and destruction 
        of drugs under this section may be carried out without notice 
        to the importer, owner, or consignee of the drugs except as 
        required by section 801(g) or section 804(i)(2). The issuance 
        of receipts for the drugs, and recordkeeping activities 
        regarding the drugs, may be carried out on a summary basis.
            ``(2) Objective of procedures.--Procedures promulgated 
        under paragraph (1) shall be designed toward the objective of 
        ensuring that, with respect to efficiently utilizing Federal 
        resources available for carrying out this section, a 
        substantial majority of shipments of drugs subject to 
        subsection (a) or (b) are identified and refused admission and 
        destroyed.
    ``(e) Evidence Exception.--Drugs may not be destroyed under 
subsection (c) to the extent that the Attorney General of the United 
States determines that the drugs should be preserved as evidence or 
potential evidence with respect to an offense against the United 
States.
    ``(f) Rule of Construction.--This section may not be construed as 
having any legal effect on applicable law with respect to a shipment of 
drugs that is imported or offered for import into the United States and 
has a declared value equal to or greater than $10,000.''.
    (b) Procedures.--Procedures for carrying out section 805 of the 
Federal Food, Drug, and Cosmetic Act, as added by subsection (a), shall 
be established not later than 90 days after the date of the enactment 
of this Act.

SEC. 7. CIVIL ACTIONS REGARDING PROPERTY.

     Section 303 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
333) is amended by adding at the end the following subsection:
    ``(g)(1) If a person is alienating or disposing of property, or 
intends to alienate or dispose of property, that is obtained as a 
result of or is traceable to a drug imported in violation of section 
801(a) or 801(d), the Attorney General may commence a civil action in 
any Federal court--
            ``(A) to enjoin such alienation or disposition of property; 
        or
            ``(B) for a restraining order to--
                    ``(i) prohibit any person from withdrawing, 
                transferring, removing, dissipating, or disposing of 
                any such property or property of equivalent value; and
                    ``(ii) appoint a temporary receiver to administer 
                such restraining order.
    ``(2) Proceedings under paragraph (1) shall be carried out in the 
same manner as applies under section 1345 of title 18, United States 
Code.''.

SEC. 8. WHOLESALE DISTRIBUTION OF DRUGS; STATEMENTS REGARDING PRIOR 
              SALE, PURCHASE, OR TRADE.

    (a) Striking of Exemptions; Applicability to Registered 
Exporters.--Section 503(e) of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 353(e)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``and who is not the manufacturer 
                or an authorized distributor of record of such drug'';
                    (B) by striking ``to an authorized distributor of 
                record or''; and
                    (C) by striking subparagraph (B) and inserting the 
                following:
    ``(B) The fact that a drug subject to subsection (b) is exported 
from the United States does not with respect to such drug exempt any 
person that is engaged in the business of the wholesale distribution of 
the drug from providing the statement described in subparagraph (A) to 
the person that receives the drug pursuant to the export of the drug.
    ``(C)(i) The Secretary may by regulation establish requirements 
that supersede subparagraph (A) (referred to in this subparagraph as 
`alternative requirements') to identify the chain of custody of a drug 
subject to subsection (b) from the manufacturer of the drug throughout 
the wholesale distribution of the drug to a pharmacist who intends to 
sell the drug at retail if the Secretary determines that the 
alternative requirements, which may include anti-counterfeiting or 
track-and-trace technologies, will identify such chain of custody or 
the identity of the drug with equal certainty to the requirements of 
subparagraph (A), and that the alternative requirements are 
economically and technically feasible.
    ``(ii) If the Secretary promulgates a final rule to establish such 
alternative requirements, the final rule in addition shall, with 
respect to the registration condition established in clause (i) of 
section 804(c)(3)(B), establish a condition equivalent to the 
alternative requirements, and such equivalent condition supersedes such 
clause (i).'';
            (2) in paragraph (2)(A), by adding at the end the 
        following: ``The preceding sentence may not be construed as 
        having any applicability with respect to a registered exporter 
        under section 804.''; and
            (3) in paragraph (3), by striking ``and subsection (d)--'' 
        in the matter preceding subparagraph (A) and all that follows 
        through ``the term `wholesale distribution' means'' in 
        subparagraph (B) and inserting the following: ``and subsection 
        (d), the term `wholesale distribution' means''.
    (b) Conforming Amendment.--Section 503(d) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 353(d)) is amended by adding at the 
end the following:
    ``(4) Each manufacturer of a drug subject to subsection (b) shall 
maintain at its corporate offices a current list of the authorized 
distributors of record of such drug.
    ``(5) For purposes of this subsection, the term `authorized 
distributors of record' means those distributors with whom a 
manufacturer has established an ongoing relationship to distribute such 
manufacturer's products.''.

SEC. 9. REPEAL OF IMPORTATION EXEMPTION UNDER CONTROLLED SUBSTANCES 
              IMPORT AND EXPORT ACT.

    Section 1006 of the Controlled Substances Import and Export Act (21 
U.S.C. 956) is repealed.
                                 <all>
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