II 

108TH CONGRESS 

2D SESSION S. 2307 

To amend the Federal Food, Drug, and Cosmetic Act with respect to the 

importation of prescription drugs by importers, and by individuals for 

personal use, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

APRIL 8, 2004 

Mr. GRASSLEY introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

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

respect to the importation of prescription drugs by importers, and by individuals for personal use, and for 

other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Reliable Entry for 

5 Medicines at Everyday Discounts through Importation 

6 with Effective Safeguards Act of 2004’’. 
2 

•S 2307 IS 

1 SEC. 2. REPEAL OF CERTAIN SECTION REGARDING IMPOR2 TATION OF PRESCRIPTION DRUGS. 

3 Chapter VIII of the Federal Food, Drug, and Cos4 metic Act (21 U.S.C. 381 et seq.), as amended by section 

5 1121(a) of Public Law 108–173 (117 Stat. 2464), is 

6 amended by striking section 804. 

7 SEC. 3. IMPORTATION OF PRESCRIPTION DRUGS; WAIVER 

8 OF CERTAIN IMPORT RESTRICTIONS. 

9 (a) IN GENERAL.—Chapter VIII of the Federal 

10 Food, Drug, and Cosmetic Act, as amended by section 2 

11 of this Act, is amended by inserting after section 803 the 

12 following section: 

13 ‘‘SEC. 804. WAIVERS REGARDING COMMERCIAL AND PER14 SONAL IMPORTATION OF PRESCRIPTION 

15 DRUGS; REGISTERED FOREIGN EXPORTERS. 

16 ‘‘(a) WAIVERS.— 

17 ‘‘(1) IN GENERAL.—The Secretary shall in ac18 cordance with this section provide by regulation 

19 that, in the case of qualifying drugs imported or of20 fered for import into the United States from reg21 istered exporters— 

22 ‘‘(A) the limitation on importation that is 

23 established in section 801(d)(1) is waived; and 

24 ‘‘(B) the standards referred to in section 

25 801(a) regarding admission of the drugs are 

26 subject to subsection (g) of this section (includ-
3 

•S 2307 IS 

1 ing with respect to qualifying drugs to which 

2 section 801(d)(1) does not apply). 

3 ‘‘(2) IMPORTERS.—A qualifying drug may not 

4 be imported under paragraph (1) unless— 

5 ‘‘(A) the drug is imported by an importer 

6 and the importation is in accordance with sub7 section (h); or 

8 ‘‘(B) the drug is imported by an individual 

9 for personal use or for the use of a family mem10 ber of the individual (rather than for resale), 

11 and the importation is in accordance with sub12 section (i). 

13 ‘‘(3) RULE OF CONSTRUCTION.—This section 

14 has legal effect only with respect to a drug that is 

15 imported or offered for import into the United 

16 States from a registered exporter. 

17 ‘‘(4) DEFINITIONS.— 

18 ‘‘(A) IMPORTER.—The term ‘importer’ 

19 means a pharmacist or wholesaler. 

20 ‘‘(B) PERMITTED COUNTRY.— 

21 ‘‘(i) IN GENERAL.—For purposes of 

22 this section, the term ‘permitted country’ 

23 means— 

24 ‘‘(I) Canada; 
4 

•S 2307 IS 

1 ‘‘(II) 180 days after the date of 

2 publication of the report under clause 

3 (ii)— 

4 ‘‘(aa) Australia; 

5 ‘‘(bb) a member country of 

6 the European Union or the Euro7 pean Free Trade Association; 

8 ‘‘(cc) Japan; and 

9 ‘‘(dd) New Zealand; and 

10 ‘‘(III) any country designated as 

11 a permitted country under clause (iii). 

12 ‘‘(ii) REPORT.— 

13 ‘‘(I) IN GENERAL.—Not later 

14 than 18 months after the date of en15 actment of this section, the Secretary 

16 shall submit to Congress a report sub17 ject to subclauses (II) and (III). 

18 ‘‘(II) CONTENTS OF REPORT.— 

19 The report under subclause (I) 

20 shall— 

21 ‘‘(aa) describe the impact of 

22 the drug importation system es23 tablished under this section on— 

24 ‘‘(AA) the safety and 

25 integrity of the Nation’s pre-
5 

•S 2307 IS 

1 scription drug distribution 

2 system; 

3 ‘‘(BB) the prevalence of 

4 counterfeit, adulterated, or 

5 misbranded drugs in the 

6 United States; and 

7 ‘‘(CC) patient drug 

8 therapy; 

9 ‘‘(bb) describe the potential 

10 impact of expanding the system 

11 to allow importation from addi12 tional countries; and 

13 ‘‘(cc) include proposed legis14 lation to improve the safety, effi15 ciency, and efficacy of the drug 

16 reimportation system; 

17 ‘‘(III) CONSULTATION WITH THE

18 FEDERAL TRADE COMMISSION.—The 

19 Secretary, in consultation with the 

20 Chairman of the Federal Trade Com21 mission, shall include in the report 

22 under subclause (I)— 

23 ‘‘(aa) an evaluation of the 

24 extent to which this section ad25 vances the objective of intro-
6 

•S 2307 IS 

1 ducing lower-priced competition 

2 in the United States market for 

3 prescription drugs; and 

4 ‘‘(bb) recommendations for 

5 improving the operation and ef6 fectiveness of this section to meet 

7 that objective. 

8 ‘‘(iii) ADDITIONAL COUNTRIES.—The 

9 Secretary may designate an additional 

10 country as a permitted country if the coun11 try meets the requirements of section 

12 802(b)(1)(B) as that section relates to 

13 drugs. 

14 ‘‘(C) PHARMACIST.—The term ‘phar15 macist’ means a person licensed by a State to 

16 practice pharmacy, including the dispensing and 

17 selling of prescription drugs. 

18 ‘‘(D) REGISTERED EXPORTER.—For pur19 poses of this section: 

20 ‘‘(i) the term ‘registered exporter’ 

21 means an exporter for which a registration 

22 under subsection (b) has been approved 

23 and is in effect. 
7 

•S 2307 IS 

1 ‘‘(ii) the term ‘registration condition’ 

2 means a condition for a registration under 

3 subsection (b) to be approved. 

4 ‘‘(E) QUALIFYING DRUG.—For purposes of 

5 this section, the term ‘qualifying drug’ means a 

6 covered prescription drug, other than any of the 

7 following: 

8 ‘‘(i) A controlled substance, as defined 

9 in section 102 of the Controlled Sub10 stances Act. 

11 ‘‘(ii) A biological product, as defined 

12 in section 351 of the Public Health Service 

13 Act. 

14 ‘‘(iii) An infused drug, including a 

15 peritoneal dialysis solution. 

16 ‘‘(iv) An intravenously injected drug. 

17 ‘‘(v) A drug that is inhaled during 

18 surgery. 

19 ‘‘(F) WHOLESALER.— 

20 ‘‘(i) IN GENERAL.—The term ‘whole21 saler’ means a person licensed as a whole22 saler or distributor of prescription drugs in 

23 the United States under section 

24 503(e)(2)(A). 
8 

•S 2307 IS 

1 ‘‘(ii) EXCLUSION.—The term ‘whole2 saler’ does not include a person authorized 

3 to import drugs under section 801(d)(1). 

4 ‘‘(G) OTHER DEFINITIONS.—For purposes 

5 of this section: 

6 ‘‘(i) The term ‘covered prescription 

7 drug’ means an approved drug under sec8 tion 505(b)(1) that is subject to section 

9 503(b)(1). 

10 ‘‘(ii) The term ‘exporter’ means a per11 son who is in the business of exporting a 

12 drug to the United States or who, pursu13 ant to submitting a registration under sub14 section (b), seeks to be in such business. 

15 ‘‘(b) REGISTRATION OF FOREIGN EXPORTERS.— 

16 ‘‘(1) IN GENERAL.—A registration condition is 

17 that the exporter involved submits to the Secretary 

18 a registration containing the following: 

19 ‘‘(A) The name of the exporter and an 

20 identification of all places of business of the ex21 porter that relate to qualifying drugs, including 

22 each warehouse or other facility owned or con23 trolled by, or operated for, the exporter. 

24 ‘‘(B) Such information as the Secretary 

25 determines to be necessary to demonstrate that 
9 

•S 2307 IS 

1 the exporter is in compliance with registration 

2 conditions under subsections (c), (d), (e), (f), 

3 and (g) (relating to the sources of exported 

4 drugs; the monitoring of foreign facilities and 

5 the marking of compliant shipments; the pay6 ment of fees; being licensed as a pharmacy (in 

7 the case of importation by individuals); and 

8 compliance with the standards referred to in 

9 section 801(a)). 

10 ‘‘(C) An agreement by the exporter that 

11 the exporter will not under subsection (a) ex12 port any drug that is not a qualifying drug. 

13 ‘‘(D) An agreement by the exporter that a 

14 qualifying drug will not under subsection (a) be 

15 exported to any person not authorized pursuant 

16 to subsection (a)(2) to be an importer of such 

17 drug. 

18 ‘‘(E) An agreement by the exporter that 

19 the exporter submits to the jurisdiction of the 

20 courts of the United States for the purpose of 

21 adjudication of any action arising out of the ac22 tivities of the exporter under this section with 

23 the name and address of an agent in the United 

24 States for service of process. 
10 

•S 2307 IS 

1 ‘‘(F) An agreement by the exporter to en2 sure and monitor compliance with each registra3 tion condition, to promptly correct any non4 compliance with such a condition, and to 

5 promptly report to the Secretary any such non6 compliance. 

7 ‘‘(G) A plan describing the manner in 

8 which the exporter will comply with the agree9 ment under subparagraph (F). 

10 ‘‘(H) An agreement by the exporter to no11 tify the Secretary of— 

12 ‘‘(i) any change that the exporter in13 tends to make regarding information pro14 vided under subparagraph (A) or (B); and 

15 ‘‘(ii) any change that the exporter in16 tends to make in the compliance plan 

17 under subparagraph (G). 

18 ‘‘(I) Such other provisions as the Secretary 

19 may require to protect the public health while 

20 permitting the importation of qualifying drugs 

21 under subsection (a). 

22 ‘‘(2) APPROVAL OR DISAPPROVAL OF REGISTRA23 TION.— 

24 ‘‘(A) IN GENERAL.—Not later than 90 

25 days after the date on which an exporter sub-
11 

•S 2307 IS 

1 mits to the Secretary a registration under para2 graph (1), the Secretary shall notify the ex3 porter whether the registration is approved or is 

4 disapproved. The Secretary shall disapprove a 

5 registration if there is reason to believe that the 

6 exporter is not in compliance with one or more 

7 registration conditions, and shall notify the ex8 porter of such reason. In the case of a dis9 approved registration, the Secretary shall subse10 quently notify the exporter that the registration 

11 is approved if the Secretary determines that the 

12 exporter is in compliance with such conditions. 

13 ‘‘(B) CHANGES IN REGISTRATION INFOR14 MATION.—Not later than 30 days after receiv15 ing a notice under paragraph (1)(G) from a 

16 registered exporter, the Secretary shall deter17 mine whether the change involved affects the 

18 approval of the registration of the exporter 

19 under paragraph (1), and shall inform the ex20 porter of the determination. 

21 ‘‘(3) PUBLICATION OF CONTACT INFORMATION

22 FOR REGISTERED EXPORTERS.—Through the Inter23 net site of the Food and Drug Administration, the 

24 Secretary shall make available to the public a list of 

25 registered exporters, including contact information 
12 

•S 2307 IS 

1 for the exporters. Such list shall be posted on such 

2 site in a manner that will assist the public in readily 

3 obtaining the list. Promptly after the approval of a 

4 registration submitted under paragraph (1), the Sec5 retary shall update the site accordingly, including, if 

6 requested by the exporter, providing a link to an 

7 Internet site of the exporter. 

8 ‘‘(4) SUSPENSION AND TERMINATION.— 

9 ‘‘(A) SUSPENSION.—With respect to the 

10 effectiveness of a registration submitted under 

11 paragraph (1) by an exporter: 

12 ‘‘(i) Subject to clause (ii), if the Sec13 retary determines, after notice and oppor14 tunity for a hearing, that the exporter has 

15 failed to maintain substantial compliance 

16 with all registration conditions, the Sec17 retary may suspend the registration. 

18 ‘‘(ii) If the Secretary determines that, 

19 under color of the registration, the ex20 porter has exported a drug that is not a 

21 qualifying drug, or a drug that does not 

22 meet the criteria under subsection 

23 (g)(2)(A), or has exported a qualifying 

24 drug to an individual in violation of sub25 section (i)(1)(E), the Secretary shall imme-
13 

•S 2307 IS 

1 diately suspend the registration. A suspen2 sion under the preceding sentence is not 

3 subject to the provision by the Secretary of 

4 prior notice, and the Secretary shall pro5 vide to the exporter involved an oppor6 tunity for a hearing not later than 10 days 

7 after the date on which the registration is 

8 suspended. 

9 ‘‘(iii) The Secretary may reinstate the 

10 registration, whether suspended under 

11 clause (i) or (ii), if the Secretary deter12 mines that the exporter has demonstrated 

13 that further violations of registration con14 ditions will not occur. 

15 ‘‘(B) TERMINATION.—The Secretary, after 

16 notice and opportunity for a hearing, may ter17 minate the registration under paragraph (1) of 

18 an exporter if the Secretary determines that the 

19 exporter has engaged in a pattern or practice of 

20 violating one or more registration conditions, or 

21 if on one or more occasions the Secretary has 

22 under subparagraph (A)(ii) suspended the reg23 istration of the exporter. The Secretary may 

24 make the termination permanent, or for a fixed 

25 period of not less than one year. During the pe-
14 

•S 2307 IS 

1 riod in which the registration is terminated, any 

2 registration submitted under paragraph (1) by 

3 the exporter or a person who is a partner in the 

4 export enterprise or a principal officer in such 

5 enterprise, and any registration prepared with 

6 the assistance of the exporter or such a person, 

7 has no legal effect under this section. 

8 ‘‘(c) SOURCES OF EXPORTED QUALIFYING DRUGS.— 

9 A registration condition is that the exporter involved 

10 agrees that a qualifying drug will under subsection (a) be 

11 exported to the United States only if, as verified by the 

12 Secretary under subsection (d)(3)(A), there is compliance 

13 with the following: 

14 ‘‘(1) The drug was manufactured in an estab15 lishment required to register under subsection (h) or 

16 (i) of section 510. 

17 ‘‘(2) The establishment is located in the United 

18 States or in any foreign country, and the establish19 ment manufactured the drug for distribution in the 

20 United States and for distribution in one or more 

21 foreign countries specified in paragraph (4) (without 

22 regard to whether in addition the drug was manu23 factured for distribution in foreign countries not so 

24 specified). 

25 ‘‘(3) The exporter obtained the drug— 
15 

•S 2307 IS 

1 ‘‘(A) directly from the establishment; or 

2 ‘‘(B) directly from an entity that, by con3 tract with the exporter— 

4 ‘‘(i) provides to the exporter a state5 ment (in such form and containing such 

6 information as the Secretary may require) 

7 that, for the chain of custody from the es8 tablishment, identifies each prior sale, pur9 chase, or trade of the drug (including the 

10 date of the transaction and the names and 

11 addresses of all parties to the transaction); 

12 ‘‘(ii) agrees to permit the Secretary to 

13 inspect such statements and related 

14 records to determine their accuracy; 

15 ‘‘(iii) agrees, with respect to the quali16 fying drugs involved, to permit the Sec17 retary to inspect warehouses and other fa18 cilities of the entity for purposes of deter19 mining whether the facilities are in compli20 ance with any standards under this Act 

21 that are applicable to facilities of that type 

22 in any of the States; and 

23 ‘‘(iv) has ensured, through such con24 tractual relationships as may be necessary, 

25 that the Secretary has the same authorities 
16 

•S 2307 IS 

1 regarding other parties in the chain of cus2 tody from the establishment that the Sec3 retary has under clauses (ii) and (iii) re4 garding such entity. 

5 ‘‘(4) The foreign country from which the ex6 porter will export the drug is a permitted country. 

7 ‘‘(5) During any period in which the drug was 

8 not in the control of the manufacturer of the drug, 

9 the drug did not enter any country that is not a per10 mitted country. 

11 ‘‘(d) MONITORING OF FACILITIES; MARKING OF

12 SHIPMENTS.— 

13 ‘‘(1) MONITORING OF FACILITIES.—A registra14 tion condition is that, for the purpose of assisting 

15 the Secretary in determining whether the exporter 

16 involved is in compliance with all other registration 

17 conditions— 

18 ‘‘(A) the exporter agrees to permit the Sec19 retary— 

20 ‘‘(i) to conduct onsite monitoring, on 

21 a day-to-day basis, of places of business of 

22 the exporter that relate to qualifying 

23 drugs, including each warehouse or other 

24 facility owned or controlled by, or operated 

25 for, the exporter; 
17 

•S 2307 IS 

1 ‘‘(ii) to have access, on a day-to-day 

2 basis, to records of the exporter that relate 

3 to the export of such drugs, including fi4 nancial records; 

5 ‘‘(iii) to carry out the duties described 

6 in paragraph (3); and 

7 ‘‘(iv) to carry out any other functions 

8 determined by the Secretary to be nec9 essary regarding the compliance of the ex10 porter; and 

11 ‘‘(B) the Secretary, with the permission of 

12 the exporter, has assigned one or more employ13 ees of the Secretary to carry out the functions 

14 described in this subsection for the Secretary— 

15 ‘‘(i) on a day-to-day basis on the 

16 premises of places of businesses referred to 

17 in subparagraph (A)(i), and such an as18 signment remains in effect on a continuous 

19 basis; or 

20 ‘‘(ii) on a periodic basis on the prem21 ises of places of businesses referred to in 

22 subparagraph (A)(i), if the Secretary de23 termines that the exporter has a sufficient 

24 history of compliance with the registration 

25 conditions. 
18 

•S 2307 IS 

1 ‘‘(2) MARKING OF COMPLIANT SHIPMENTS.—A 

2 registration condition is that the exporter involved 

3 agrees to affix to each shipping container of quali4 fying drugs exported under subsection (a) such 

5 markings as the Secretary determines to be nec6 essary to identify the shipment as being in compli7 ance with all registration conditions. Markings under 

8 the preceding sentence— 

9 ‘‘(A) shall be designed to prevent affixation 

10 of the markings to any shipping container that 

11 is not authorized to bear the markings; and 

12 ‘‘(B) may include anti-counterfeiting or 

13 track-and-trace technologies. 

14 ‘‘(3) CERTAIN DUTIES.—Duties of the Sec15 retary under paragraphs (1) and (2) regarding an 

16 exporter include the following: 

17 ‘‘(A) Verifying the chain of custody of each 

18 qualifying drug from the manufacturer of the 

19 drug to the exporter. 

20 ‘‘(B) If one or more qualifying drugs are 

21 exported to individuals under subsection 

22 (a)(2)(B), randomly selecting samples of such 

23 exports for the purpose of determining whether 

24 the drugs are being imported by the individuals 

25 in accordance with the conditions under sub-
19 

•S 2307 IS 

1 section (i). Such sampling shall be conducted in 

2 a manner that will result in a statistically sig3 nificant determination of compliance with all 

4 such conditions. 

5 ‘‘(C) Monitoring the affixing of markings 

6 under paragraph (2). 

7 ‘‘(e) FEES.— 

8 ‘‘(1) IN GENERAL.—A registration condition is 

9 that the exporter involved pays to the Secretary in 

10 accordance with this subsection a fee on a semi11 annual basis, with the first fee due on the date on 

12 which the exporter first submits a registration under 

13 subsection (b). 

14 ‘‘(2) AMOUNT OF FEE.— 

15 ‘‘(A) AGGREGATE TOTAL OF FEES.—The 

16 Secretary shall ensure that the aggregate total 

17 of fees collected under paragraph (1) for a fis18 cal year from all exporters is sufficient to pay 

19 the costs of administering this section for a fis20 cal year, including monitoring foreign facilities 

21 under subsection (d); developing, implementing, 

22 and maintaining under such subsection a sys23 tem to mark shipments to indicate compliance 

24 with all registration conditions; and conducting 

25 under such subsection inspections within the 
20 

•S 2307 IS 

1 United States to determine compliance with 

2 conditions under subsections (h) and (i); except 

3 that, during the 12-month period beginning on 

4 the date of the promulgation of the interim 

5 final rule for implementing this section, the 

6 Secretary may collect a lesser aggregate total of 

7 fees, taking into account the number of reg8 istered exporters and the capacity of such ex9 porters as a group to pay such administrative 

10 costs. 

11 ‘‘(B) INDIVIDUAL EXPORTER FEE.—Sub12 ject to the exception described in subparagraph 

13 (A), a fee under paragraph (1) for an exporter 

14 shall be an amount that is a reasonable esti15 mate by the Secretary of the semiannual pro 

16 rata share of the exporter of the costs referred 

17 to in subparagraph (A). Such pro rata share 

18 shall take into account the number of employees 

19 that the Secretary has under subsection 

20 (d)(1)(B) assigned to the exporter. 

21 ‘‘(3) USE OF FEES.—Subject to appropriations 

22 Acts, fees collected by the Secretary under para23 graph (1) are available to the Secretary for paying 

24 the costs referred to in paragraph (2)(A). 
21 

•S 2307 IS 

1 ‘‘(f) LICENSING AS A PHARMACY.—A registration 

2 condition is that the exporter involved agrees that a quali3 fying drug will under subsection (a)(2)(B) be exported to 

4 an individual only if the Secretary has determined that— 

5 ‘‘(1) (A) the exporter is authorized under for6 eign law to dispense drugs that are only safe for use 

7 under the supervision of a practitioner authorized by 

8 law to administer such drugs; and 

9 ‘‘(B) the foreign country that issued such au10 thorization for the exporter did so under a regu11 latory program that, with respect to the training of 

12 persons who dispense such drugs but do not admin13 ister the drugs, protects the public health in a man14 ner comparable to programs of the States that regu15 late pharmacists; or 

16 ‘‘(2) in any case in which the exporter does not 

17 meet the condition described in paragraph (1), the 

18 exporter employs a sufficient number of individuals 

19 that are licensed as a pharmacist under the law of 

20 one of the States, and the exporter assigns to such 

21 pharmacist responsibility for dispensing qualifying 

22 drugs under subsection (a)(2)(B). 

23 ‘‘(g) COMPLIANCE WITH SECTION 801(a).— 

24 ‘‘(1) IN GENERAL.—A registration condition is 

25 that each qualifying drug exported under subsection 
22 

•S 2307 IS 

1 (a) by the exporter involved is in compliance with the 

2 standards referred to in section 801(a) regarding ad3 mission of the drug into the United States, subject 

4 to paragraphs (2) and (3) and subsection (j). 

5 ‘‘(2) APPROVAL STATUS.— 

6 ‘‘(A) IMPORTATION.—Subject to subpara7 graphs (C) and (D), a drug may, in accordance 

8 with the other subsections of this section, be 

9 imported into the United States if the following 

10 criteria are met: 

11 ‘‘(i) The Secretary has with respect to 

12 the drug verified compliance with sub13 section (c), including verifying that the 

14 drug is approved for commercial distribu15 tion in a foreign country specified in para16 graph (4) of such subsection, and that the 

17 establishment that manufactured the drug 

18 also manufactures the drug for distribution 

19 in the United States (referred to in this 

20 paragraph as a ‘U.S. label drug’). 

21 ‘‘(ii) As compared to the U.S. label 

22 drug, the drug has the same active ingre23 dient or ingredients, route of administra24 tion, dosage form, and strength, according 
23 

•S 2307 IS 

1 to information provided by the labeling of 

2 the drug. 

3 ‘‘(B) PETITION BY MANUFACTURER; GEN4 ERAL PROVISIONS.— 

5 ‘‘(i) IN GENERAL.—A person who 

6 manufactures a drug imported under sub7 section (a) may in accordance with this 

8 paragraph file with the Secretary a peti9 tion that requests the Secretary to order 

10 that importation of the drug under such 

11 subsection cease. Such a petition may be 

12 accepted for filing only if the petition 

13 claims that the drug is changed from the 

14 U.S. label drug and the change would re15 quire the submission of a supplemental ap16 plication if made to the U.S. label drug, 

17 and only if the petition claims that— 

18 ‘‘(I) the change could, under sec19 tion 314.70 of title 21, Code of Fed20 eral Regulations, be made before the 

21 approval of such application; or 

22 ‘‘(II) (aa) the change could not, 

23 under such section 314.70, be made 

24 before the approval of such applica25 tion; and 
24 

•S 2307 IS 

1 ‘‘(bb) the change raises a bio2 equivalence consideration described in 

3 subparagraph (E)(i). 

4 ‘‘(ii) CERTIFICATIONS.—The Sec5 retary may not accept a petition under 

6 clause (i) for filing unless the chief execu7 tive officer, the chief legal counsel, and the 

8 chief medical officer of the manufacturer 

9 involved each certifies in the petition that 

10 the information provided in the petition is 

11 complete and true. 

12 ‘‘(iii) CERTAIN CLAIMS.—With respect 

13 to a drug being imported under subsection 

14 (a) for which a claim is made in a petition 

15 under clause (i) (referred to in this para16 graph as a ‘petition drug’), the Secretary 

17 may not accept the petition for filing under 

18 clause (i) if the Secretary determines that 

19 any of the changes from the U.S. label 

20 drug described in the petition is— 

21 ‘‘(I) a variation provided for in 

22 the approved application under section 

23 505(b)(1) for the U.S. label drug; or 

24 ‘‘(II) a change for which, under 

25 section 314.70 of title 21, Code of 
25 

•S 2307 IS 

1 Federal Regulations, a supplemental 

2 application would not be required. 

3 ‘‘(iv) FEE.—The Secretary may not 

4 accept a petition under clause (i) for filing 

5 unless the person submitting the petition 

6 pays to the Secretary a fee in the same 

7 amount as would apply if the person were 

8 paying a fee pursuant to section 

9 736(a)(1)(A)(ii), except that the fee may 

10 not be required for a petition that, under 

11 clause (i)(II)(bb), makes a nonequivalence 

12 claim (as defined in subparagraph (E)(i)). 

13 Subject to appropriations Acts, fees col14 lected by the Secretary under the pre15 ceding sentence are available to the Sec16 retary for paying the costs referred to in 

17 subsection (e)(2)(A). 

18 ‘‘(v) REVIEW BY SECRETARY.—The 

19 Secretary shall grant or deny a petition 

20 under clause (i) not later than 180 days 

21 after the date on which the petition is 

22 filed. 

23 ‘‘(C) PETITION; DRUG CHANGES NOT RE24 QUIRING PRIOR APPROVAL.—In the case of a 

25 petition under subparagraph (B)(i)(I): 
26 

•S 2307 IS 

1 ‘‘(i) During the period in which the 

2 petition is being reviewed by the Secretary, 

3 the authority under subsection (a) to im4 port the petition drug involved continues in 

5 effect, subject to clause (ii). 

6 ‘‘(ii) Such authority is, during such 

7 period, subject to the condition that— 

8 ‘‘(I) any importer importing the 

9 petition drug under subsection 

10 (a)(2)(A) inform individuals to whom 

11 the importer sells or dispenses the 

12 drug that the manufacturer is making 

13 a claim that the drug is different than 

14 the U.S. label drug; and 

15 ‘‘(II) the registered exporter in16 volved notify any individuals import17 ing the petition drug from the ex18 porter under subsection (a)(2)(B) that 

19 the manufacturer is making such a 

20 claim. 

21 ‘‘(iii) If the Secretary determines that 

22 the supplemental application referred to in 

23 subparagraph (C)(i)(I) regarding the U.S. 

24 label drug would not be approved, the Sec25 retary shall grant the petition and order 
27 

•S 2307 IS 

1 that importation of the petition drug under 

2 subsection (a) cease. 

3 ‘‘(D) PETITION; DRUG CHANGES REQUIR4 ING PRIOR APPROVAL.— 

5 ‘‘(i) BIOEQUIVALENCE CONSIDER6 ATIONS.—For purposes of subparagraph 

7 (B)(i)(II)(bb), a claim that a change in a 

8 petition drug raises a bioequivalence con9 sideration is a claim that— 

10 ‘‘(I) the change creates the possi11 bility that such drug is not bioequiva12 lent to the U.S. label drug (in this 

13 paragraph referred to as a ‘possible14 nonequivalence claim’); or 

15 ‘‘(II) the petition drug is not bio16 equivalent to the U.S. label drug (re17 ferred to in this paragraph as a ‘non18 equivalence claim’). 

19 ‘‘(ii) INFORMATION REGARDING FOR20 EIGN GOVERNMENT.—The Secretary may 

21 not accept a petition for filing under sub22 paragraph (B)(i) that makes a possible23 nonequivalence claim or a nonequivalence 

24 claim unless the following conditions are 

25 met with respect to the foreign country 
28 

•S 2307 IS 

1 that approved the petition drug for com2 mercial distribution: 

3 ‘‘(I) The person filing the peti4 tion submits with the petition infor5 mation demonstrating that the person 

6 has notified the government of the 

7 foreign country in writing that the 

8 person is submitting to the Secretary 

9 a claim under clause (i), which notice 

10 describes the claim. 

11 ‘‘(II) Such person submits with 

12 the petition the information the per13 son submitted to the government of 

14 the foreign country for purposes of 

15 obtaining approval for commercial dis16 tribution of the petition drug in the 

17 country. 

18 ‘‘(iii) POSSIBLE-NONEQUIVALENCE

19 CLAIM.—In the case of a petition under 

20 subparagraph (C)(i) that makes a possible21 nonequivalence claim: 

22 ‘‘(I) Clauses (i) and (ii) of sub23 paragraph (C) apply to the same ex24 tent and in the same manner as such 

25 clauses apply to a petition under sub-
29 

•S 2307 IS 

1 paragraph (B)(i) that makes a claim 

2 described in subclause (I) of such sub3 paragraph. 

4 ‘‘(II) If the Secretary determines 

5 that the petition drug is not bio6 equivalent to the U.S. label drug, the 

7 Secretary shall grant the petition and 

8 order that importation of the petition 

9 drug under subsection (a) cease. 

10 ‘‘(iv) NONEQUIVALENCE CLAIM.—In 

11 the case of a petition under subparagraph 

12 (B)(i) that makes a nonequivalence claim: 

13 ‘‘(I) Promptly after the petition 

14 is filed, the Secretary shall order that 

15 the importation of the petition drug 

16 involved cease during the period in 

17 which the petition is under review by 

18 the Secretary. 

19 ‘‘(II) If the Secretary determines 

20 that the petition drug is not bio21 equivalent to the U.S. label drug, the 

22 Secretary shall grant the petition and 

23 provide that the order under sub24 clause (I) remains in effect. 
30 

•S 2307 IS 

1 ‘‘(v) DRUGS APPROVED ON OR AFTER

2 JANUARY 1, 2004.—In the case of a petition 

3 under subparagraph (C)(i) that makes a 

4 possible-nonequivalence claim or a non5 equivalence claim, if the petition drug in6 volved for commercial distribution was ap7 proved by the foreign government on or 

8 after January 1, 2004, or if the U.S. label 

9 drug was approved by the Secretary on or 

10 after such date: 

11 ‘‘(I) The Secretary may not ac12 cept the petition for filing unless the 

13 person submitting the petition sub14 mits with the petition information 

15 demonstrating that— 

16 ‘‘(aa) the difference between 

17 the petition drug and the U.S. 

18 label drug is due to a difference 

19 between the legal requirements 

20 for approval of the drug in the 

21 foreign country and for approval 

22 by the Secretary; or 

23 ‘‘(bb) the person has sub24 mitted a supplemental application 

25 to the government of the foreign 
31 

•S 2307 IS 

1 country, or to the Secretary, that 

2 will, if approved, remove the dif3 ference between the petition drug 

4 and the U.S. label drug. 

5 ‘‘(II) If under clause (iii)(II) or 

6 (iv)(II) the Secretary has ordered that 

7 importation of the petition drug under 

8 subsection (a) cease, the Secretary 

9 shall rescind the order promptly after 

10 the approval of a supplemental appli11 cation referred to in subclause (I)(bb) 

12 of this clause. 

13 ‘‘(vi) FALSE STATEMENTS.—The Sec14 retary shall rescind an order under clause 

15 (iii)(II) or (iv)(II) promptly after deter16 mining that a materially false, fictitious, or 

17 fraudulent statement or representation in 

18 the petition involved was a material factor 

19 in the decision of the Secretary to grant 

20 the petition. 

21 ‘‘(3) LABELING.— 

22 ‘‘(A) IMPORTATION BY IMPORTER.—In the 

23 case of a qualifying drug that under subsection 

24 (a)(2)(A) is imported or offered for import with 

25 respect to an importer, such drug shall be con-
32 

•S 2307 IS 

1 sidered to be in compliance with section 502 if 

2 the drug bears a copy of the labeling approved 

3 for the drug under section 505, without regard 

4 to whether the copy bears the trademark in5 volved. The Secretary shall provide such copy to 

6 the registered exporter involved, upon request 

7 of the exporter. 

8 ‘‘(B) IMPORTATION BY INDIVIDUAL.—In 

9 the case of a qualifying drug that under sub10 section (a)(2)(B) is imported or offered for im11 port with respect to an individual, such drug 

12 shall be considered to be in compliance with 

13 section 502 if the drug bears a label providing 

14 the directions for use by the consumer, and 

15 bears a copy of any special labeling that would 

16 be required by the Secretary had the drug been 

17 dispensed by a pharmacist in the United States, 

18 without regard to whether the special labeling 

19 bears the trademark involved. The Secretary 

20 shall provide to the registered exporter involved 

21 a copy of the special labeling, upon request of 

22 the exporter. 

23 ‘‘(h) IMPORTERS; CONDITIONS FOR IMPORTATION.— 

24 ‘‘(1) IN GENERAL.—For purposes of subsection 

25 (a)(2)(A), the importation of a qualifying drug by an 
33 

•S 2307 IS 

1 importer is in accordance with this subsection if the 

2 following conditions are met: 

3 ‘‘(A) The importer, or a business organiza4 tion of which the importer is a part, takes deliv5 ery directly from the mail, from a common car6 rier, or from a vehicle or aircraft owned by the 

7 importer or such business organization. 

8 ‘‘(B) From the port of entry for the drug 

9 to the delivery of the drug to the importer or 

10 such business organization— 

11 ‘‘(i) all transport of the drug was by 

12 one or more of the modes of transport 

13 specified in subparagraph (A); and 

14 ‘‘(ii) personnel of the transporting en15 tities involved had exclusive custody of the 

16 drug, without the custodial involvement of 

17 any other type of entity, including a person 

18 in the business of the wholesale distribu19 tion of drugs. 

20 ‘‘(2) RULE OF CONSTRUCTION.—Paragraph (1) 

21 may not be construed as prohibiting a person in the 

22 business of the wholesale distribution of drugs, or 

23 any other entity that is not an importer, or a busi24 ness organization referred to in paragraph (1)(A), 

25 from negotiating the purchase price of qualifying 
34 

•S 2307 IS 

1 drugs from a registered exporter or from otherwise 

2 being involved in the process of purchasing such 

3 drugs from such exporters, if such person or other 

4 entity does not at any point have custody of such 

5 drugs. 

6 ‘‘(i) PERSONAL USE; CONDITIONS FOR IMPORTA7 TION.— 

8 ‘‘(1) IN GENERAL.—For purposes of subsection 

9 (a)(2)(B), the importation of a qualifying drug by 

10 an individual is in accordance with this subsection if 

11 the following conditions are met: 

12 ‘‘(A) The drug is accompanied by— 

13 ‘‘(i) a copy of a prescription for the 

14 drug, which prescription— 

15 ‘‘(I) is valid under applicable 

16 Federal and State laws; and 

17 ‘‘(II) was issued by a practitioner 

18 who, under the law of a State of 

19 which the individual is a resident, is 

20 authorized to administer prescription 

21 drugs; and 

22 ‘‘(ii) a statement that provides infor23 mation sufficient for the Secretary to de24 termine whether the prescription meets the 

25 requirement of clause (i), including with 
35 

•S 2307 IS 

1 respect to the licensure of the practitioner 

2 who issued the prescription. 

3 ‘‘(B) With respect to the foreign country 

4 from which the registered exporter involved dis5 pensed the drug, the drug is accompanied by a 

6 copy of the documentation that was required 

7 under the law or regulations of such country as 

8 a condition of dispensing the drug to the indi9 vidual. 

10 ‘‘(C) The copies referred to in subpara11 graphs (A)(i) and (B) are marked in a manner 

12 sufficient— 

13 ‘‘(i) to indicate that the prescription, 

14 and the equivalent document in the foreign 

15 country involved, have been filled; and 

16 ‘‘(ii) to prevent a duplicative filling by 

17 another pharmacist. 

18 ‘‘(D) The quantity of the drug does not ex19 ceed a 90-day supply. 

20 ‘‘(E) The drug is not an ineligible subpart 

21 H drug. For purposes of this section, a pre22 scription drug is an ineligible subpart H drug 

23 if the drug was approved by the Secretary 

24 under subpart H of part 314 of title 21, Code 

25 of Federal Regulations (relating to accelerated 
36 

•S 2307 IS 

1 approval), with restrictions under section 520 of 

2 such part to assure safe use, and the Secretary 

3 has published in the Federal Register a notice 

4 that the Secretary has determined that good 

5 cause exists to prohibit the drug from being im6 ported pursuant to this subsection. 

7 ‘‘(2) NOTICE REGARDING PERSONAL ENTRY.— 

8 A registration condition is that the exporter involved 

9 agrees that, in providing a qualifying drug to an in10 dividual under subsection (a)(2)(B) in circumstances 

11 in which the drug will accompany the individual as 

12 the individual enters the United States, the exporter 

13 will notify the individual that the drug is authorized 

14 to be imported under such subsection only if the 

15 shipping container for the drug is intact and bears 

16 the marking affixed under subsection (d)(2). 

17 ‘‘(3) PRESUMPTION.—In the case of importa18 tion under this subsection, for purposes of judicial 

19 and administrative procedure, there is a presumption 

20 that a drug proposed for export under subsection (a) 

21 is an approved drug under section 505(b)(1) if the 

22 criteria described in subsection (g)(A)(i) and (ii) are 

23 met. 

24 ‘‘(j) STANDARDS FOR REFUSING ADMISSION.—A 

25 qualifying drug exported under subsection (a) from a reg-
37 

•S 2307 IS 

1 istered exporter may be refused admission into the United 

2 States only if one or more of the following applies: 

3 ‘‘(1) The shipping container for such drug does 

4 not bear the markings required subsection (d)(2). 

5 ‘‘(2) Such markings appear to be counterfeit. 

6 ‘‘(3) The shipping container or markings ap7 pear to have been tampered with. 

8 ‘‘(4) The shipping container appears damaged 

9 in a way that may affect the strength, quality, or 

10 purity of the drug. 

11 ‘‘(5) After the shipment leaves the custody of 

12 the registered exporter, the Secretary becomes aware 

13 that— 

14 ‘‘(A) the drug may be counterfeit; 

15 ‘‘(B) the drug may have been prepared, 

16 packed, or held under insanitary conditions 

17 whereby it may have been contaminated with 

18 filth; or 

19 ‘‘(C) the methods used in, or the facilities 

20 or controls used for, the manufacturing, proc21 essing, packing, or holding of the drug do not 

22 conform to good manufacturing practice. 

23 ‘‘(6) The Secretary has obtained an injunction 

24 under section 302 that prohibits the distribution of 

25 the drug in interstate commerce. 
38 

•S 2307 IS 

1 ‘‘(7) The Secretary has under section 505(e) 

2 withdrawn approval of the drug. 

3 ‘‘(8) The manufacturer of the drug has insti4 tuted a recall of the drug. 

5 ‘‘(k) CHARITABLE CONTRIBUTIONS.—Notwith6 standing any other provision of this section, this section 

7 does not authorize the importation into the United States 

8 of a qualifying drug donated or otherwise supplied for free 

9 or at nominal cost by the manufacturer of the drug to 

10 a charitable or humanitarian organization, including the 

11 United Nations and affiliates, or to a government of a for12 eign country.’’ 

13 (b) PROHIBITED ACTS.—The Federal Food, Drug, 

14 and Cosmetic Act, as amended by section 1121(b) of Pub15 lic Law 108–173 (117 Stat. 2469), is amended— 

16 (1) in section 301 (21 U.S.C. 331), by amend17 ing paragraph (aa) to read as follows: 

18 ‘‘(aa)(1) The sale or trade by an importer, or by a 

19 business organization of which the importer is a part, of 

20 a qualifying drug that under section 804(a)(2)(A) was im21 ported by the importer, other than— 

22 ‘‘(A) a sale at retail made pursuant to dis23 pensing the drug to a customer of the importer or 

24 organization; or 
39 

•S 2307 IS 

1 ‘‘(B) a sale or trade of the drug to the reg2 istered exporter from which the importer imported 

3 the drug. 

4 ‘‘(2) The sale or trade by an individual of a qualifying 

5 drug that under section 804(a)(2)(B) was imported by the 

6 individual. 

7 ‘‘(3) The knowing making of a materially false, ficti8 tious, or fraudulent statement or representation in a peti9 tion under clause (i) of section 804(g)(2)(C). Such a peti10 tion that is not accepted for filing by reason of clause (iii) 

11 of such section shall be considered to contain such a state12 ment or representation.’’; and 

13 (2) in section 303(a) (21 U.S.C. 333(a)), by 

14 amending paragraph (6) to read as follows: 

15 ‘‘(6) Notwithstanding subsection (a), any person who 

16 violates section 301(aa)(3) shall be imprisoned not more 

17 than 10 years, or fined in accordance with title 18, United 

18 States Code, or both.’’. 

19 (c) CIVIL PENALTY.— 

20 (1) TECHNICAL AMENDMENTS.— 

21 (A) IN GENERAL.—Section 303 of the Fed22 eral Food, Drug, and Cosmetic Act (21 U.S.C. 

23 333) is amended in the last subsection by strik24 ing the subsection designation and all that fol-
40 

•S 2307 IS 

1 lows through ‘‘Except as provided’’ in para2 graph (1)(A) and inserting the following: 

3 ‘‘(f)(1)(A) Except as provided’’. 

4 (B) CERTAIN ACTS.—The amendments 

5 made by the following provisions of law are 

6 deemed to have been made to subsection (f) of 

7 section 303 of the Federal Food, Drug, and 

8 Cosmetic Act, as amended by subparagraph (A) 

9 of this paragraph: 

10 (i) section 407 of the Food Quality 

11 Protection Act of 1996 (110 Stat. 1535); 

12 and 

13 (ii) section 201(c) of the Medical De14 vice User Fee and Modernization Act of 

15 2002 (116 Stat. 1609). 

16 (2) CIVIL PENALTIES.— 

17 (A) IN GENERAL.—Section 303 of the Fed18 eral Food, Drug, and Cosmetic Act (21 U.S.C. 

19 333), as amended by paragraph (1) of this sub20 section, is amended in subsection (f)— 

21 (i) by redesignating paragraphs (3) 

22 through (5) as paragraphs (4) through (6), 

23 respectively; and 

24 (ii) by inserting after paragraph (2) 

25 the following paragraph: 
41 

•S 2307 IS 

1 ‘‘(3) Any person who knowingly violates section 

2 301(aa)(3) and whose statement or representation 

3 described in such section was a material factor in 

4 the decision of the Secretary to issue an order under 

5 clause (iii)(II) or (iv)(II) of section 804(g)(2)(E) 

6 shall be liable to the United States for a civil penalty 

7 in an amount not to exceed a reasonable estimate of 

8 the gross revenue that, pursuant to section 804, 

9 would have been collected by the register exporter 

10 involved for sales of the qualifying drug involved to 

11 importers and individuals in the United States dur12 ing the period for which the order was in effect.’’. 

13 (B) CONFORMING AMENDMENTS.—Section 

14 303(f) of the Federal Food, Drug, and Cos15 metic Act, as amended by subparagraph (A), is 

16 amended— 

17 (i) in paragraph 5 (as redesignated) 

18 by striking ‘‘paragraph (3)(A)’’ and insert19 ing ‘‘paragraph (4)(A)’’; and 

20 (ii) in paragraph 6 (as redesignated) 

21 by striking ‘‘paragraph (4)’’ each place it 

22 appears and inserting ‘‘paragraph (5)’’. 

23 (d) IMPLEMENTATION.— 

24 (1) RULEMAKING.—Not later than 90 days 

25 after the date of the enactment of this Act, the Sec-
42 

•S 2307 IS 

1 retary of Health and Human Services shall promul2 gate an interim final rule for implementing section 

3 804 of the Federal Food, Drug, and Cosmetic Act, 

4 as added by subsection (a) of this section. Such rule 

5 shall be developed and promulgated by the Secretary 

6 without providing general notice of proposed rule7 making, and the rule may be made effective imme8 diately upon promulgation of the rule. Not later 

9 than one year after the date on which the interim 

10 final rule is promulgated, the Secretary shall, in ac11 cordance with procedures under section 553 of title 

12 5, United States Code, promulgate a final rule for 

13 implementing such section 804, which may incor14 porate by reference provisions of the interim final 

15 rule, to the extent that such provisions are not modi16 fied. 

17 (2) PERSONAL IMPORTATION FROM CANADA.— 

18 Until the expiration of the 45-day period beginning 

19 on the date on which the interim final rule under 

20 paragraph (1)(A) is promulgated, an individual may 

21 import a prescription drug from Canada for personal 

22 use or for the use of a family member of the indi23 vidual (rather than for resale), subject to compliance 

24 with each of the following conditions: 

25 (A) The drug is not— 
43 

•S 2307 IS 

1 (i) a controlled substance, as defined 

2 in section 102 of the Controlled Sub3 stances Act; 

4 (ii) a biological product, as defined in 

5 section 351 of the Public Health Service 

6 Act; 

7 (iii) an infused drug, including a peri8 toneal dialysis solution; 

9 (iv) an intravenously injected drug; 

10 (v) a drug that is inhaled during sur11 gery; or 

12 (vi) a drug approved by the Secretary 

13 under subpart H of part 314 of title 21, 

14 Code of Federal Regulations (relating to 

15 accelerated approval) with restrictions 

16 under section 520 of such part to assure 

17 safe use. 

18 (B) The drug is dispensed by a person li19 censed in Canada to dispense such drugs. 

20 (C) The drug is accompanied by a copy of 

21 the prescription for the drug, which prescrip22 tion— 

23 (i) is valid under applicable Federal 

24 and State laws; and 
44 

•S 2307 IS 

1 (ii) was issued by a practitioner who, 

2 under the law of a State of which the indi3 vidual is a resident, is authorized to ad4 minister prescription drugs. 

5 (D) The drug is accompanied by a copy of 

6 the document that was required in Canada as 

7 a condition of dispensing the drug to the indi8 vidual. 

9 (E) The copies referred to in subpara10 graphs (C) and (D) are marked in a manner 

11 sufficient— 

12 (i) to indicate that the prescription, 

13 and the equivalent document in Canada, 

14 have been filled; and 

15 (ii) to prevent a duplicative filling by 

16 another pharmacist. 

17 (F) The quantity of the drug does not ex18 ceed a 90-day supply. 

19 (e) AMENDMENT OF CERTAIN PROVISION.—Section 

20 801(g) of the Federal Food, Drug, and Cosmetic Act (21 

21 U.S.C. 381) is amended— 

22 (1) in the matter preceding clause (i), by strik23 ing ‘‘With respect to’’ and all that follows through 

24 ‘‘may not send’’ and inserting the following: ‘‘With 

25 respect to a qualifying drug that is imported or of-
45 

•S 2307 IS 

1 fered for import in the United States by an indi2 vidual pursuant to section 804(a)(2)(B), the Sec3 retary may not send’’; 

4 (2) by redesignating clause (iv) as clause (v); 

5 (3) in clause (iii), by striking ‘‘or’’ at the end; 

6 and 

7 (4) by inserting after clause (iii) the following: 

8 ‘‘(iv) importation is not in accordance with 

9 section 804; or’’. 

10 SEC. 4. ADDITIONAL WAIVERS REGARDING PERSONAL IM11 PORTATION; ENFORCEMENT POLICIES OF 

12 SECRETARY. 

13 (a) IN GENERAL.—Section 801 of the Federal Food, 

14 Drug, and Cosmetic Act (21 U.S.C. 381) is amended by 

15 adding at the end the following subsections: 

16 ‘‘(p)(1) Waivers under this subsection are in addition 

17 to, and independent of, the waiver pursuant to section 

18 804(a)(2)(B). 

19 ‘‘(2) With respect to the standards referred to in sub20 section (d)(1), the Secretary may establish by regulation 

21 a waiver of such standards in the case of the importation 

22 by an individual of a drug into the United States in the 

23 following circumstances: 

24 ‘‘(A) The drug was dispensed to the individual 

25 while the individual was in the United States, the 
46 

•S 2307 IS 

1 drug was dispensed by a pharmacist or by a practi2 tioner licensed by law to administer the drug, and the 

3 individual traveled from the United States with the 

4 drug. 

5 ‘‘(B) The individual is entering the United 

6 States and the drug accompanies the individual at 

7 the time of entry. 

8 ‘‘(C) The drug does not appear to the Secretary 

9 to be adulterated. 

10 ‘‘(D) The quantity of the drug does not exceed 

11 a 30-day supply. 

12 ‘‘(E) The drug is accompanied by a statement 

13 that the individual seeks to import the drug into the 

14 United States under a personal importation waiver. 

15 ‘‘(F) The importation complies with such addi16 tional standards as the Secretary determines to be 

17 appropriate to protect the public health. 

18 ‘‘(3) With respect to the standards referred to in sub19 sections (a) and (d)(1), the Secretary may establish by 

20 regulation a waiver of such standards in the case of the 

21 importation by an individual of a drug into the United 

22 States in the following circumstances: 

23 ‘‘(A) The drug was dispensed to the individual 

24 while the individual was in a foreign country, and 
47 

•S 2307 IS 

1 the drug was dispensed in accordance with the laws 

2 and regulations of such country. 

3 ‘‘(B) The individual is entering the United 

4 States and the drug accompanies the individual at 

5 the time of entry. 

6 ‘‘(C) The drug is approved for commercial dis7 tribution in the foreign country in which the drug 

8 was obtained. 

9 ‘‘(D) The drug does not appear to the Secretary 

10 to be adulterated. 

11 ‘‘(E) The quantity of the drug does not exceed 

12 a 10-day supply. 

13 ‘‘(F) The drug is accompanied by a statement 

14 that the individual seeks to import the drug into the 

15 United States under a personal importation waiver. 

16 ‘‘(G) The importation complies with such addi17 tional standards as the Secretary determines to be 

18 appropriate to protect the public health. 

19 ‘‘(q) The Secretary may not administer any enforce20 ment policy that has the effect of permitting the importa21 tion of a prescription drug into the United States in viola22 tion of this Act or section 351 of the Public Health Service 

23 Act.’’. 

24 (b) ADDITIONAL WAIVER.—This Act and the amend25 ments made by this Act shall not be construed as limiting 
48 

•S 2307 IS 

1 the authority of the Secretary of Health and Human Serv2 ices to establish a waiver of the standards referred to in 

3 section 801(a) of the Federal Food, Drug, and Cosmetic 

4 Act with respect to the importation by an individual of 

5 a drug into the United States that does not meet such 

6 standards, provided that such waiver is no more permis7 sive than the guidance, as in effect on January 1, 2004, 

8 that is provided in the item numbered 2 (relating to a 

9 specific situation, consisting of conditions (a) through (d)) 

10 under the heading ‘‘Drugs, Biologics, and Devices’’ in 

11 chapter 9 of the FDA/ORA Regulatory Procedures Man12 ual (relating to import operations/actions), in the sub13 chapter relating to coverage of personal importations. 

14 SEC. 5. DISPOSITION OF CERTAIN DRUGS DENIED ADMIS15 SION INTO UNITED STATES. 

16 (a) IN GENERAL.—Chapter VIII of the Federal 

17 Food, Drug, and Cosmetic Act, as amended by section 3 

18 of this Act, is amended by adding at the end the following 

19 section: 

20 ‘‘SEC. 805. DISPOSITION OF CERTAIN DRUGS DENIED AD21 MISSION. 

22 ‘‘(a) IN GENERAL.—A shipment of drugs that is im23 ported or offered for import into the United States shall 

24 be refused admission if the shipment has a declared value 

25 of less than $10,000 and the drugs are in violation of any 
49 

•S 2307 IS 

1 standard referred to in section 801(a) or 801(d)(1), in2 cluding any drugs imported or offered for import under 

3 enforcement policies prohibited under section 801(q). 

4 ‘‘(b) IMPORTATION UNDER SECTION 804.—In the 

5 case of a drug that under section 804 is imported or of6 fered for import from a registered exporter, the reference 

7 in subsection (a) to standards referred to in section 801(a) 

8 or 801(d)(1) shall be considered a reference to standards 

9 referred to in section 804(j). 

10 ‘‘(c) DESTRUCTION OF VIOLATIVE SHIPMENTS.— 

11 Drugs refused admission under subsection (a) or (b) shall 

12 be destroyed, subject to subsection (e). Section 801(b) 

13 does not authorize the delivery of the drugs pursuant to 

14 the execution of a bond, and the drugs may not be ex15 ported. 

16 ‘‘(d) CERTAIN PROCEDURES.— 

17 ‘‘(1) IN GENERAL.—The refusal of admission 

18 and destruction of drugs under this section may be 

19 carried out without notice to the importer, owner, or 

20 consignee of the drugs. The issuance of receipts for 

21 the drugs, and recordkeeping activities regarding the 

22 drugs, may be carried out on a summary basis. 

23 ‘‘(2) OBJECTIVE OF PROCEDURES.—Procedures 

24 promulgated under paragraph (1) shall be designed 

25 toward the objective of ensuring that, with respect to 
50 

•S 2307 IS 

1 efficiently utilizing Federal resources available for 

2 carrying out this section, a substantial majority of 

3 shipments of drugs subject to subsection (a) or (b) 

4 are identified and refused admission and destroyed. 

5 ‘‘(e) EVIDENCE EXCEPTION.—Drugs may not be de6 stroyed under subsection (c) to the extent that the Attor7 ney General of the United States determines that the 

8 drugs should be preserved as evidence or potential evi9 dence with respect to an offense against the United States. 

10 ‘‘(f) RULE OF CONSTRUCTION.—This section may 

11 not be construed as having any legal effect on applicable 

12 law with respect to a shipment of drugs that is imported 

13 or offered for import into the United States and has a 

14 declared value equal to or greater than $10,000. 

15 ‘‘(g) ADMINISTRATION.—This section may be not be 

16 construed as transferring to the Secretary responsibility 

17 for carrying out this section.’’. 

18 (b) PROCEDURES.—Procedures for carrying out sec19 tion 805 of the Federal Food, Drug, and Cosmetic Act, 

20 as added by subsection (a) of this subsection, shall be es21 tablished not later than 30 days after the date of the en22 actment of this Act. 
51 

•S 2307 IS 

1 SEC. 6. CIVIL ACTIONS REGARDING PROPERTY. 

2 Section 303 of the Federal Food, Drug, and Cosmetic 

3 Act (21 U.S.C. 333) is amended by adding at the end the 

4 following subsection: 

5 ‘‘(g)(1) If a person is alienating or disposing of prop6 erty, or intends to alienate or dispose of property, that 

7 is obtained as a result of or is traceable to a drug imported 

8 in violation of subsection (a) or (d) of section 801 or sec9 tion 804, the Attorney General may commence a civil ac10 tion in any Federal court— 

11 ‘‘(A) to enjoin such alienation or disposition of 

12 property; or 

13 ‘‘(B) for a restraining order to— 

14 ‘‘(i) prohibit any person from withdrawing, 

15 transferring, removing, dissipating, or disposing 

16 of any such property or property of equivalent 

17 value; and 

18 ‘‘(ii) appoint a temporary receiver to ad19 minister such restraining order. 

20 ‘‘(2) Proceedings under paragraph (1) shall be car21 ried out in the same manner as applies under section 1345 

22 of title 18, United States Code.’’. 
52 

•S 2307 IS 

1 SEC. 7. WHOLESALE DISTRIBUTION OF DRUGS; STATE2 MENTS REGARDING PRIOR SALE, PURCHASE, 

3 OR TRADE. 

4 (a) STRIKING OF EXEMPTIONS; APPLICABILITY TO

5 REGISTERED EXPORTERS.—Section 503(e) of the Federal 

6 Food, Drug, and Cosmetic Act (21 U.S.C. 353(e)) is 

7 amended— 

8 (1) in paragraph (1)— 

9 (A) by striking ‘‘and who is not the manu10 facturer or an authorized distributor of record 

11 of such drug’’ and inserting ‘‘, other than a 

12 registered exporter under section 804,’’; 

13 (B) by striking ‘‘to an authorized dis14 tributor of record or’’; and 

15 (C) by striking subparagraph (B) and in16 serting the following subparagraphs: 

17 ‘‘(B) The fact that a drug subject to subsection (b) 

18 is exported from the United States does not with respect 

19 to such drug exempt any person who is engaged in the 

20 business of the wholesale distribution of the drug from 

21 providing the statement described in subparagraph (A) to 

22 the person who receives the drug pursuant to the export 

23 of the drug. 

24 ‘‘(C) (i) The Secretary may by regulation establish 

25 requirements that supersede subparagraph (A) (referred 

26 to in this subparagraph as ‘alternative requirements’) to 
53 

•S 2307 IS 

1 identify the chain of custody of a drug subject to sub2 section (b) from the manufacturer of the drug throughout 

3 the wholesale distribution of the drug to an importer who 

4 intends to sell the drug at retail if the Secretary deter5 mines that the alternative requirements will identify such 

6 chain of custody or the identity of the drug with greater 

7 certainty than the requirements of subparagraph (A), and 

8 that the alternative requirements are economically and 

9 technically feasible. 

10 ‘‘(ii) If the Secretary promulgates a final rule to es11 tablish such alternative requirements, the final rule in ad12 dition shall, with respect to the registration condition es13 tablished in clause (i) of section 804(c)(3)(B), establish 

14 a condition equivalent to the alternative requirements, and 

15 such equivalent condition supersedes such clause (i).’’; 

16 (2) in paragraph (2)(A), by adding at the end 

17 the following: ‘‘The preceding sentence may not be 

18 construed as having any applicability with respect to 

19 a registered exporter under section 804.’’; and 

20 (3) in paragraph (3), by striking ‘‘and sub21 section (d)—’’ in the matter preceding subparagraph 

22 (A) and all that follows through ‘‘the term ‘whole23 sale distribution’ means’’ in subparagraph (B) and 

24 inserting the following: ‘‘and subsection (d), the 

25 term ‘wholesale distribution’ means’’. 
54 

•S 2307 IS 

1 (b) CONFORMING AMENDMENT.—Section 503(d) of 

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

3 353(d)) is amended by adding at the end the following 

4 paragraphs: 

5 ‘‘(4) Each manufacturer of a drug subject to sub6 section (b) shall maintain at its corporate offices a current 

7 list of the authorized distributors of record of such drug. 

8 ‘‘(5) For purposes of this subsection, the term ‘au9 thorized distributors of record’ means those distributors 

10 with whom a manufacturer has established an ongoing re11 lationship to distribute such manufacturer’s products.’’. 

12 SEC. 8. REPEAL OF IMPORTATION EXEMPTION UNDER CON13 TROLLED SUBSTANCES IMPORT AND EXPORT 

14 ACT. 

15 Section 1006 of the Controlled Substances Import 

16 and Export Act (21 U.S.C. 956) is repealed. 

17 SEC. 9. ENFORCEMENT THROUGH DENIAL OF DEDUCTION 

18 FOR CERTAIN ADVERTISING EXPENSES. 

19 (a) IN GENERAL.—Part IX of subchapter B of chap20 ter 1 of the Internal Revenue Code of 1986 (relating to 

21 items not deductible) is amended by adding at the end 

22 the following new section: 
55 

•S 2307 IS 

1 ‘‘SEC. 280L. ADVERTISING EXPENDITURES OF TAXPAYERS 

2 WHO DISCRIMINATE AGAINST FOREIGN SELL3 ERS OF PRESCRIPTION DRUGS TO DOMESTIC 

4 CONSUMERS. 

5 ‘‘(a) IN GENERAL.—No deduction otherwise allow6 able under this chapter shall be allowed for any amount 

7 paid or incurred for advertising for the taxable year by 

8 any taxpayer unless the taxpayer certifies that the tax9 payer has not taken any action, directly or indirectly, dur10 ing such taxable year to prevent the authorized importa11 tion of a qualifying drug into the United States from a 

12 registered exporter to a pharmacy or individual pursuant 

13 to section 804(a) of the Federal Food, Drug, and Cos14 metic Act or has otherwise conditioned the terms by which 

15 a qualifying drug is imported into the United States from 

16 a registered exporter under such section. Such certifi17 cation shall be made in such manner as the Secretary de18 termines and shall be accompanied by such fees as the 

19 Secretary determines necessary to cover the costs of con20 firming such certification. 

21 ‘‘(b) ADVERTISING.—For purposes of this section, 

22 the term ‘advertising’ includes direct to consumer adver23 tising and any activity designed to promote the use of a 

24 prescription drug directed to providers or others who may 

25 make decisions about the use of prescription drugs (other 

26 than the provision of free samples).’’. 
56 

•S 2307 IS 

1 (b) CLERICAL AMENDMENT.—The table of sections 

2 for part IX of subchapter B of chapter 1 of such Code 

3 is amended by adding at the end thereof the following new 

4 item: 

‘‘Sec. 280L. Advertising expenditures of taxpayers who discriminate against foreign sellers of prescription drugs to domestic consumers.’’. 

5 (c) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply to taxable years beginning after 

7 the date of the enactment of this Act. 

8 SEC. 10. COMPLIANCE THROUGH ALLOWANCE OF RE9 SEARCH AND DEVELOPMENT TAX CREDIT. 

10 (a) IN GENERAL.—Section 41 of the Internal Rev11 enue Code of 1986 (relating to credit for increasing re12 search activities) is amended by adding at the end the fol13 lowing new subsection: 

14 ‘‘(i) INCREASE IN CREDIT FOR CERTAIN TAX15 PAYERS.—The amount of the credit otherwise determined 

16 under this section for any taxable year shall be increased 

17 by 20 percent if the taxpayer certifies that the taxpayer 

18 has not taken any action, directly or indirectly, during 

19 such taxable year to prevent the authorized importation 

20 of a qualifying drug into the United States from a reg21 istered exporter to a pharmacy or individual pursuant to 

22 section 804(a) of the Federal Food, Drug, and Cosmetic 

23 Act or has otherwise conditioned the terms by which a 

24 qualifying drug is imported into the United States from 
57 

•S 2307 IS 

1 a registered exporter under such section. Such certifi2 cation shall be made in such manner as the Secretary de3 termines and shall be accompanied by such fees as the 

4 Secretary determines necessary to cover the costs of con5 firming such certification.’’. 

6 (b) EFFECTIVE DATE.—The amendment made by 

7 this section shall apply to taxable years beginning after 

8 the date of the enactment of this Act. 

Æ