II 

116TH CONGRESS 

1ST SESSION S. 102 

To significantly lower prescription drug prices for patients in the United 

States by ending government-granted monopolies for manufacturers who 

charge drug prices that are higher than the median prices at which 

the drugs are available in other countries. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 10, 2019 

Mr. SANDERS (for himself, Mr. BOOKER, Mr. BLUMENTHAL, Mrs. GILLIBRAND, Ms. HARRIS, and Ms. WARREN) introduced the following bill; 

which was read twice and referred to the Committee on Health, Education, Labor, and Pensions 

A BILL 

To significantly lower prescription drug prices for patients 

in the United States by ending government-granted monopolies for manufacturers who charge drug prices that 

are higher than the median prices at which the drugs 

are available in other countries. 

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 ‘‘Prescription Drug 

5 Price Relief Act of 2019’’. 


kjohnson on DSK79L0C42 with BILLS
2 

•S 102 IS

1 SEC. 2. IDENTIFICATION OF EXCESSIVELY PRICED DRUGS. 

2 (a) IN GENERAL.—The Secretary, not later than 1 

3 year after the date of enactment of this Act, shall establish 

4 a process to conduct a review of all brand name drugs, 

5 not less frequently than once per calendar year, under 

6 which the Secretary determines under subsection (b) 

7 whether the price of each such drug is excessive. 

8 (b) EXCESSIVE PRICE DETERMINATIONS.— 

9 (1) INTERNATIONAL REFERENCE PRICE.— 

10 (A) IN GENERAL.—The Secretary shall de11 termine that any brand name drug for which 

12 the domestic average manufacturing price ex13 ceeds the median price charged for such drug in 

14 the 5 reference countries to have an excessive 

15 price. In assessing the extent to which the price 

16 is excessive, the Secretary shall consider the 

17 factors described in paragraph (2). 

18 (B) REFERENCE COUNTRIES.—In this Act, 

19 the term ‘‘reference countries’’ means Canada, 

20 the United Kingdom, Germany, France, and 

21 Japan. 

22 (C) REQUIREMENT WITH RESPECT TO

23 DRUGS FOR WHICH CERTAIN REFERENCE COUN24 TRY INFORMATION IS NOT AVAILABLE.—The 

25 Secretary shall make a determination under 

26 paragraph (1) for every brand name drug for 


kjohnson on DSK79L0C42 with BILLS
3 

•S 102 IS

1 which pricing information is available for at 

2 least 3 of the 5 reference countries. 

3 (2) DETERMINATIONS BASED ON OTHER FAC4 TORS.—With respect to any brand name drug that 

5 is not determined to have an excessive price by oper6 ation of paragraph (1) (including any drug for which 

7 there is insufficient data to make such a determina8 tion under such paragraph), the Secretary shall de9 termine that such drug has an excessive price if the 

10 price of the drug is higher than reasonable taking 

11 into account the following factors: 

12 (A) The size of the affected patient popu13 lation. 

14 (B) The value of the drug to patients, in15 cluding the impact of the price on access to the 

16 drug and the relationship of the price of the 

17 drug to its therapeutic health benefits. 

18 (C) The risk adjusted value of Federal 

19 Government subsidies and investments related 

20 to the drug. 

21 (D) The costs associated with development 

22 of the drug. 

23 (E) Whether the drug provided a signifi24 cant improvement in health outcomes, comVerDate Sep 11 2014 02:57 Jan 17, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S102.IS S102

kjohnson on DSK79L0C42 with BILLS
4 

•S 102 IS

1 pared to other therapies available at the time of 

2 its approval. 

3 (F) The cumulative global revenues gen4 erated by the drug. 

5 (G) Whether the domestic average manu6 facturer price of the drug increased during any 

7 annual quarter by a percentage that is more 

8 than the percentage increase in the consumer 

9 price index for all urban consumers for the re10 spective annual quarter. 

11 (H) Other factors the Secretary determines 

12 appropriate. 

13 (c) PETITION FOR DETERMINATION.— 

14 (1) IN GENERAL.—Any person may petition the 

15 Secretary, in accordance with section 553(e) of title 

16 5, United States Code, to make an excessive drug 

17 price determination for an applicable drug under 

18 subsection (b)(2). Not later than 90 days after the 

19 date of receipt of such a petition, subject to para20 graph (2), the Secretary shall— 

21 (A) make a determination under subsection 

22 (b)(2) regarding such drug; or 

23 (B)(i) decline to make such a determina24 tion; and 


kjohnson on DSK79L0C42 with BILLS
5 

•S 102 IS

1 (ii) make public the reasons why the Sec2 retary has declined to make such a determina3 tion. 

4 (2) EXCEPTION.—The Secretary shall not make 

5 a determination under subsection (b)(2) for a drug 

6 in response to a petition under this section more fre7 quently than once per calendar year. 

8 (3) PUBLIC AVAILABILITY.—The Secretary 

9 shall make any petitions submitted under this sub10 section, together with any documentation related to 

11 the petitions and the Secretary’s determinations on 

12 such petitions and rationale for such determinations, 

13 publicly available, including by posting such informa14 tion on the database under section 5. 

15 SEC. 3. ENDING GOVERNMENT-GRANTED MONOPOLIES FOR 

16 EXCESSIVELY PRICED DRUGS. 

17 (a) EXCESSIVE DRUG PRICE AUTHORITY.—With re18 spect to any brand name drug, if the Secretary determines 

19 under section 2 that the price of the drug is excessive, 

20 the Secretary— 

21 (1) shall waive or void any government-granted 

22 exclusivities with respect to such drug, effective on 

23 the date that the excessive price determination under 

24 section 2 is made for such drug; and 


kjohnson on DSK79L0C42 with BILLS
6 

•S 102 IS

1 (2) shall grant open, non-exclusive licenses al2 lowing any person to make, use, offer to sell or sell, 

3 or import into the United States such drug, and to 

4 rely upon the regulatory test data of such drug, in 

5 accordance with section 4. 

6 (b) EXPEDITED REVIEW.—The Secretary shall 

7 prioritize the review of, and act within 8 months of the 

8 date of the submission of a generic drug application or 

9 a biosimilar biological product application if such applica10 tion references a drug licensed under subsection (a)(2). 

11 (c) CIVIL ACTIONS.—If the Secretary determines that 

12 the manufacturer of an excessively priced drug (as deter13 mined under section 2(a)) has increased the price of such 

14 drug during the period beginning on the date on which 

15 such price determination is made and ending on the date 

16 on which an entity begins manufacturing the drug under 

17 an open, non-exclusive license under subsection (a)(2), the 

18 Secretary may file a civil action in the United States dis19 trict court for the district in which the manufacturer is 

20 located, or in the United States district court for the Dis21 trict of Columbia, to recover damages in an amount equal 

22 to not less than the total amount of revenue derived by 

23 the manufacturer as a result of any such price increase 

24 during such period. In actions brought under this sub25 section, the district courts shall have jurisdiction to grant 


kjohnson on DSK79L0C42 with BILLS
7 

•S 102 IS

1 all appropriate relief including, but not limited to, injunc2 tive relief and compensatory damages. 

3 SEC. 4. EXCESSIVE DRUG PRICE LICENSE. 

4 (a) REASONABLE ROYALTY.— 

5 (1) IN GENERAL.—An entity accepting an open, 

6 non-exclusive license under section 3(a)(2) shall pay 

7 a reasonable royalty to the holder of a patent that 

8 claims the drug or that claims a use of the drug or 

9 to the holder of an application approved under sub10 section 505(c) of the Federal Food, Drug, and Cos11 metic Act or section 351(a) of the Public Health 

12 Service Act for which any government-granted exclu13 sivity with respect to the drug was terminated under 

14 section 5(a)(1). 

15 (2) ROYALTY RATE.—Such royalty rate shall 

16 be— 

17 (A) a percentage of sales, where the per18 centage rate is no higher than the average roy19 alty rate estimated from the data provided by 

20 the Internal Revenue Service for pharma21 ceutical manufacturer Federal income tax re22 turns; or 

23 (B) an amount as determined by the Sec24 retary, taking into account— 

25 (i) the value of the drug to patients; 


kjohnson on DSK79L0C42 with BILLS
8 

•S 102 IS

1 (ii) the size of the affected patient 

2 population; 

3 (iii) the risk adjusted value of the 

4 Federal Government subsidies and invest5 ments related to the drug; 

6 (iv) whether the drug provided a sig7 nificant improvement in health outcomes, 

8 compared to other therapies available at 

9 the time of the approval; 

10 (v) the extent to which the brand 

11 name drug manufacturer has recovered 

12 risk adjusted investments related to the 

13 drug, including the investments related to 

14 the invention, regulatory test data and any 

15 other relevant research and development 

16 costs; and 

17 (vi) any other information the Sec18 retary determines appropriate. 

19 (b) REQUIREMENTS.— 

20 (1) IN GENERAL.—A royalty rate under sub21 section (a) shall be consistent with making drugs 

22 available to purchasers, including Federal, State, 

23 local, and nongovernmental purchasers and individ24 uals, at prices that are affordable and reasonable. 

25 Under no condition shall a royalty be set at a rate 


kjohnson on DSK79L0C42 with BILLS
9 

•S 102 IS

1 that would cause a product for which an open, non2 exclusive license was issued under section 3 to be 

3 sold at an excessive price, as determined under sec4 tion 2. 

5 (2) MULTIPLE AFFECTED PARTIES.—In the 

6 case that there is one or more holders or investors 

7 in the patented inventions related to the drug in ad8 dition to the brand name manufacturer, the royalty 

9 rate shall be divided among the holders or investors 

10 (including such manufacturer) in a manner agreed 

11 upon by the manufacturer and other holders or in12 vestors, or, in the absence of such an agreement, in 

13 a manner the Secretary determines to be appro14 priate. 

15 (3) PRICE.—An entity accepting an open, non16 exclusive license under section 3(a)(2) shall sell the 

17 drug at a price not higher than the excessive price 

18 determined for that drug under section 2(b). 

19 SEC. 5. PUBLIC EXCESSIVE DRUG PRICE DATABASE. 

20 (a) EXCESSIVE DRUG PRICE DATABASE.— 

21 (1) IN GENERAL.—The Secretary shall establish 

22 and maintain a comprehensive, up-to-date database 

23 of brand name drugs and the excessive price deter24 minations for such drugs under section 2. 


kjohnson on DSK79L0C42 with BILLS
10 

•S 102 IS

1 (2) CONTENTS.—The database shall include, at 

2 a minimum, for each brand name drug, for the ap3 plicable calendar year— 

4 (A) the name of the drug; 

5 (B) the manufacturer; 

6 (C) whether the drug was determined 

7 under section 2(b) to have an excessive price; 

8 (D) the number of petitions the Secretary 

9 received under section 2(c) to make an exces10 sive price determination for the drug, together 

11 with the information described in section 

12 2(c)(3); 

13 (E) the number of open, non-exclusive li14 censes the Secretary has granted under section 

15 3(a)(2) for generic drug or biosimilar biological 

16 product versions of the drug; and 

17 (F) the number of applications under sub18 section (b)(2) or (j) of section 505 of the Fed19 eral Food, Drug, and Cosmetic Act or under 

20 section 351(k) of the Public Health Service Act 

21 submitted to the Secretary, pursuant to such a 

22 license granted under section 3(a)(2), and the 

23 number of such applications that have been ap24 proved. 


kjohnson on DSK79L0C42 with BILLS
11 

•S 102 IS

1 (3) CERTAIN DETERMINATIONS.—With respect 

2 to a determination made under section 2(b)(1), the 

3 Secretary shall publish on the database such deter4 mination in accordance with paragraph (1) within 

5 30 days of receiving domestic and international pric6 ing information from manufacturers under section 6. 

7 (b) ANNUAL REPORTS TO CONGRESS.—Not later 

8 than 60 days after the first excessive price review under 

9 section 2 is complete, and annually thereafter, the Sec10 retary shall submit to Congress a report describing the 

11 excessive drug price review for the preceding year. The 

12 report shall contain summary data regarding— 

13 (1) the total number of drugs that were re14 viewed; 

15 (2) the total number of drugs determined to be 

16 excessively priced under each of paragraphs (1) and 

17 (2) of section 2(b), and the name and manufacturer 

18 of each such drug; 

19 (3) the total number of drugs determined to be 

20 excessively priced, listed by manufacturer; 

21 (4) the extent to which the prices of the drugs 

22 identified under section 2 were higher than reason23 able, on average; 


kjohnson on DSK79L0C42 with BILLS
12 

•S 102 IS

1 (5) the total number of drugs for which an 

2 open-non-exclusive license has been granted under 

3 section 3(a)(2); 

4 (6) the total number of generic drug or bio5 similar biological product applications received and 

6 approved that reference a drug so licensed; 

7 (7) the median approval time for generic drug 

8 or biosimilar biological product applications that ref9 erence a drug so licensed; 

10 (8) the total number of petitions the Secretary 

11 received under section 2(c) to make excessive price 

12 determinations for drugs; 

13 (9) a list of any manufacturers who failed to re14 port information as required under section 6; and 

15 (10) other appropriate information, as the Sec16 retary determines or as Congress requests. 

17 (c) PUBLIC AVAILABILITY.—The Secretary shall 

18 make the information in the database described in sub19 section (a) and the report in subsection (b) publicly avail20 able, including on the internet website of the Food and 

21 Drug Administration, in a manner that is easy to find and 

22 understand. 

23 SEC. 6. DRUG MANUFACTURER REPORTING. 

24 (a) IN GENERAL.—Each manufacturer shall submit 

25 to the Secretary, in such format as the Secretary may reVerDate Sep 11 2014 02:57 Jan 17, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S102.IS S102

kjohnson on DSK79L0C42 with BILLS
13 

•S 102 IS

1 quire, an annual report that includes the following infor2 mation for each brand name drug of the manufacturer, 

3 with respect to the previous calendar year: 

4 (1) The average manufacturer price of the drug 

5 in the United States and in the reference countries, 

6 for the entire year, and broken down for each quar7 ter of the year. 

8 (2) The wholesale acquisition cost of the drug 

9 in the United States and in the reference countries, 

10 for the entire year, and broken down for each quar11 ter of the year. 

12 (3) Cumulative global revenues generated by 

13 the drug. 

14 (4) Annual net sales revenue generated by the 

15 drug in the United States and in the reference coun16 tries, for the entire year, and broken down for each 

17 quarter of the year. 

18 (5) Total expenditures on domestic and foreign 

19 drug research and development related to the drug, 

20 itemized by— 

21 (A) basic and preclinical research; 

22 (B) clinical research, reported separately 

23 for each clinical trial; 


kjohnson on DSK79L0C42 with BILLS
14 

•S 102 IS

1 (C) development of alternative dosage 

2 forms and strengths for the drug molecule or 

3 combinations, including the molecule; 

4 (D) other drug development activities, such 

5 as nonclinical laboratory studies and record and 

6 report maintenance; 

7 (E) pursuing new or expanded indications 

8 for such drug through supplemental applica9 tions under section 505 of the Federal Food, 

10 Drug, and Cosmetic Act; and 

11 (F) carrying out postmarket requirements 

12 related to such drug, including under section 

13 505(o)(3) of the Federal Food, Drug, and Cos14 metic Act. 

15 (6) Total expenditures on domestic and foreign 

16 marketing and advertising related to the drug. 

17 (7) Investments in human clinical trials related 

18 to the drug, by each trial and each year, including 

19 grants, research contracts, tax credits or deductions, 

20 and reimbursements from public or private health 

21 plans or insurance, and any other public sector sub22 sidies or incentives, such as the fair market value or 

23 priority review vouchers or other considerations. 

24 (8) The estimated size of the affected patient 

25 population. 


kjohnson on DSK79L0C42 with BILLS
15 

•S 102 IS

1 (9) Additional information the manufacturer 

2 chooses to provide related to drug pricing decisions, 

3 such as information related to the methodology used 

4 to set the price of the drug. 

5 (10) Additional information as the Secretary 

6 determines necessary to carry out this Act, including 

7 information for previous years. 

8 (b) REPORT DUE DATE.—Applicable manufacturers 

9 shall submit the reports described in subsection (a) not 

10 later than January 15 of the year following the date of 

11 enactment of this Act, and of each year thereafter. 

12 (c) PENALTY FOR NONCOMPLIANCE.— 

13 (1) IN GENERAL.—Any manufacturer that fails 

14 to submit information for a drug as required by this 

15 section on a timely basis or that knowingly provides 

16 false information shall be liable for a civil monetary 

17 penalty, as determined by the Secretary under para18 graph (2), in addition to any other penalty under 

19 other applicable provisions of law. 

20 (2) AMOUNT OF PENALTY.—The amount of a 

21 civil penalty under paragraph (1) shall be equal to 

22 the product of— 

23 (A) an amount, as determined appropriate 

24 by the Secretary, which is— 


kjohnson on DSK79L0C42 with BILLS
16 

•S 102 IS

1 (i) not less than 0.5 percent of the 

2 gross revenues from sales for the previous 

3 calendar year of the drug for which the in4 formation was not submitted; and 

5 (ii) not greater than 1 percent of the 

6 gross revenues from sales for the previous 

7 calendar year of such drug; and 

8 (B) the number of days in the period be9 tween— 

10 (i) the report due date under sub11 section (b); and 

12 (ii) the date on which the Secretary 

13 receives the information required to be re14 ported by the manufacturer under this sec15 tion. 

16 (3) USE OF CIVIL PENALTY.—The Secretary 

17 shall collect the civil penalties under this subsection 

18 and shall use such funds to support competitive re19 search grant programs of the National Institutes of 

20 Health. 

21 SEC. 7. PROHIBITION OF ANTICOMPETITIVE BEHAVIOR. 

22 No manufacturer may engage in anticompetitive be23 havior violating section 5(a) of the Federal Trade Com24 mission Act (15 U.S.C. 45(a)) with another manufacturer 

25 that may interfere with the issuance and implementation 


kjohnson on DSK79L0C42 with BILLS
17 

•S 102 IS

1 of open, non-exclusive licenses under this Act or otherwise 

2 run contrary to the public interest in the availability of 

3 affordable prescription drugs. 

4 SEC. 8. DEFINITIONS. 

5 For the purposes of this Act: 

6 (1) AVERAGE MANUFACTURER PRICE.— 

7 (A) IN GENERAL.—The term ‘‘average 

8 manufacturer price’’, with respect to a drug, 

9 subject to subparagraph (B), has the meaning 

10 given such term in section 1927(k)(1) of the 

11 Social Security Act (42 U.S.C. 1396r–8(k)(1)); 

12 or with respect to a drug for which there is no 

13 average manufacturer price as so defined, such 

14 term shall mean the wholesale acquisition cost 

15 (as defined in section 1847A(c)(6)(B) of the 

16 Social Security Act (42 U.S.C. 1395w– 

17 3a(c)(6)(B)) of the drug. 

18 (B) APPLICATION TO REFERENCE COUN19 TRIES.—With respect to reference countries, 

20 the term ‘‘average manufacturer price’’, as de21 fined in subparagraph (A), shall be determined 

22 based on the price of the drug in the applicable 

23 reference country. 

24 (2) BIOSIMILAR BIOLOGICAL PRODUCT.—The 

25 term ‘‘biosimilar biological product’’ means a biologiVerDate Sep 11 2014 02:57 Jan 17, 2019 Jkt 089200 PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 E:\BILLS\S102.IS S102

kjohnson on DSK79L0C42 with BILLS
18 

•S 102 IS

1 cal product licensed pursuant to an application 

2 under section 351(k) of the Public Health Service 

3 Act (42 U.S.C. 262(k)). 

4 (3) BRAND NAME DRUG.—The term ‘‘brand 

5 name drug’’ means a drug that is— 

6 (A) approved under section 505(c) of the 

7 Federal Food, Drug, and Cosmetic Act (21 

8 U.S.C. 355(c)) or a biological product licensed 

9 under section 351(a) of the Public Health Serv10 ice Act (42 U.S.C. 262(a)); 

11 (B) subject to section 503(b)(1) of the 

12 Federal Food, Drug, and Cosmetic Act (21 

13 U.S.C. 353(b)(1)); and 

14 (C) claimed in a patent or the use of which 

15 is claimed in a patent. 

16 (4) GENERIC DRUG.—The term ‘‘generic drug’’ 

17 means a drug approved pursuant to an application 

18 under section (b)(2) or (j) of the Federal Food, 

19 Drug, and Cosmetic Act (21 U.S.C. 355). 

20 (5) GOVERNMENT-GRANTED EXCLUSIVITY.— 

21 The term ‘‘government-granted exclusivity’’ means 

22 prohibitions on the submission or approval of drug 

23 applications granted under any of the following: 


kjohnson on DSK79L0C42 with BILLS
19 

•S 102 IS

1 (A) Clauses (ii) through (v) of section 

2 505(c)(3)(E) of the Federal Food, Drug, and 

3 Cosmetic Act (21 U.S.C. 355(c)(3)(E)). 

4 (B) Section 505(j)(5)(B)(iv) of the Federal 

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

6 355(j)(5)(B)(iv)) or clause (ii), (iii), or (iv) of 

7 section 505(j)(5)(F) of such Act. 

8 (C) Section 505A of the Federal Food, 

9 Drug, and Cosmetic Act (21 U.S.C. 355a). 

10 (D) Section 505E of the Federal Food, 

11 Drug, and Cosmetic Act (21 U.S.C. 355f). 

12 (E) Section 527 of the Federal Food, 

13 Drug, and Cosmetic Act (21 U.S.C. 360cc). 

14 (F) Section 351(k)(7) of the Public Health 

15 Service Act (42 U.S.C. 262(k)(7)). 

16 (G) Any other provision of law that pro17 vides for exclusivity (or extension of exclusivity) 

18 with respect to a drug. 

19 (6) MANUFACTURER.—The term ‘‘manufac20 turer’’ means the holder of an application approved 

21 under section 505 of the Federal Food, Drug, and 

22 Cosmetic Act (21 U.S.C. 355) or of a license issued 

23 under section 351 of the Public Health Service Act 

24 (42 U.S.C. 262). 


kjohnson on DSK79L0C42 with BILLS
20 

•S 102 IS

1 (7) OPEN, NON-EXCLUSIVE LICENSE.—The 

2 term ‘‘open, non-exclusive license’’ means a license 

3 that authorizes any person to use a patent held by 

4 a manufacturer that claims a brand name drug or 

5 a use of a brand name drug or rely upon regulatory 

6 test data for such drug, including patents held in 

7 common by the manufacturer and other entities, 

8 needed to produce, manufacture, import, export, dis9 tribute, offer in liquidation, sell, buy, or use such 

10 brand name drug. 

11 (8) SECRETARY.—The term ‘‘Secretary’’ means 

12 the Secretary of Health and Human Services. 

Æ 


kjohnson on DSK79L0C42 with BILLS