that drug costs have risen at a 19.1 percent annual 
rate over the last eight years and projects that they 
will rise at a 10.1 percent rate annual over the next 
decade. Drug prices are far higher in the United 
States than in any other developed country because 
it is the only country that grants pharmaceutical 
companies a monopoly in the market, based on pat-
ent protection, without any corresponding restriction 
on prices. 
(2) New pharmaceuticals are decreasing in 
number and quality. In 2002, 17 new drugs classi-
fied as new compounds were approved by the Food 
and Drug Administration (‘‘FDA’’), down from 24 
in 2001 and 27 in 2000. The vast majority of new 
drugs are not breakthrough cures, but rather copy-
cat drugs. According to the FDA, more than 70 per-
cent of new drugs approved in the last decade do not 
constitute qualitative improvements over existing 
treatments. 
(3) Pharmaceutical manufacturers have dis-
torted the quality of drug research in many in-
stances, such as with the drug Celebrex. Often due 
to the influence of the funding source, drug research 
has been shown to suffer from concealed and dis-
torted findings, bias, conflicts of interest, and se-
crecy. 
SEC. 3. ESTABLISHMENT OF NATIONAL INSTITUTE FOR 
BIOMEDICAL RESEARCH AND DEVELOPMENT. 
Part C of title IV of the Public Health Service Act 
(42 U.S.C. 285 et seq.) is amended by adding at the end 
the following subpart: 
‘‘Subpart 19—National Institute for Biomedical 
Research and Development 
‘‘PURPOSE OF THE INSTITUTE 
‘‘SEC. 464z–1. (a) IN GENERAL.—The general pur-
pose of the National Institute for Biomedical Research 
and Development (in this section referred to as the ‘Insti-
tute’) is to provide in accordance with this section for the 
development of drugs, biological products, and devices, in-
cluding through Federal laboratories under subsection (f), 
in a manner that will foster an increase in the number 
and medical efficacy of drugs, biological products, and de-
vices on the market and will make the drugs, biological 
products, and devices available to the public at reasonable 
prices. 
‘‘(b) IDENTIFICATION
OF
CANDIDATE
DISCOV-
ERIES.—The Director shall monitor the results of research 
conducted or supported by the National Institutes of 
Health, and by other appropriate public or private entities,
in order to identify discoveries that, if subjected to appro-
priate research and development activities, may be suitable 
for the submission of applications for approval by the 
Food and Drug Administration as drugs, biological prod-
ucts, or devices for use in humans (referred to in this sec-
tion as ‘candidate discoveries’). 
‘‘(c) RESEARCH AND OTHER ACTIVITIES REGARDING 
CANDIDATE DISCOVERIES.— 
‘‘(1) IN GENERAL.—The Director of the Insti-
tute shall conduct and support research, training, 
the dissemination of information, and other pro-
grams toward identifying candidate discoveries and 
carrying out appropriate research and development 
activities regarding such discoveries. 
‘‘(2) ANNUAL PLAN.—The Director of the Insti-
tute shall establish, and annually review and as ap-
propriate revise, a plan for the development, testing, 
and manufacture of candidate discoveries through 
the Institute. 
‘‘(3) AWARDS REGARDING RESEARCH AND DE-
VELOPMENT.—Each award of financial assistance 
under paragraph (1) for research and development 
activities shall be an award of a cooperative agree-
ment or a contract.
‘‘(4) PRIORITIES.—In allocating the resources 
of the Institute, the Director of the Institute shall 
establish priorities among candidate discoveries. 
‘‘(5) INTERNET SITE.—The Director of the In-
stitute shall maintain an Internet site to make avail-
able to the public information on activities under 
this section, including activities carried out by the 
Director and activities carried out under cooperative 
agreements or contracts under paragraph (1). Infor-
mation posted on such site shall be updated quar-
terly, or on such more frequent intervals as the Di-
rector determines to be appropriate. Such informa-
tion shall include the following: 
‘‘(A) An identification of candidate discov-
eries that are receiving priority under para-
graph (4). 
‘‘(B) All raw data developed under para-
graph (1) in carrying out research and develop-
ment activities. 
‘‘(C) Findings made in carrying out such 
activities. 
‘‘(d) PATENTS.— 
‘‘(1) IN GENERAL.—The Director may identify 
a discovery as a candidate discovery only if the Fed-
eral Government holds, or can reasonably be ex-
pected to obtain, a patent on the discovery. The Di-
rector may not transfer ownership of such patent to 
any non-Federal entity, notwithstanding any con-
flicting provision of chapter 18 of title 35, United 
States Code. 
‘‘(2) CITIZENS’ SUITS
FOR
PROTECTION
OF 
FEDERAL OWNERSHIP OF PATENTS.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (C), any person may on his or 
her behalf commence a civil action in an appro-
priate district court of the United States 
against— 
‘‘(i) any person in order to protect 
Federal ownership of patents on candidate 
discoveries; or 
‘‘(ii) the Secretary where there is al-
leged a failure of the Secretary to protect 
Federal ownership of such patents. 
‘‘(B) RELIEF.—In a civil action under sub-
paragraph (A), the district court involved may, 
as the case may be— 
‘‘(i) enforce the compliance of a per-
son with provisions relating to Federal 
ownership of patents; or
‘‘(ii) order the Secretary to perform 
an act or duty relating to such ownership. 
‘‘(C) LIMITATIONS.— 
‘‘(i) NOTICE TO SECRETARY.—A civil 
action may not be commenced under sub-
paragraph (A)(i) prior to 60 days after the 
plaintiff has provided to the Secretary no-
tice of the violation involved. 
‘‘(ii) RELATION TO ACTIONS OF SEC-
RETARY.—A civil action may not be com-
menced under subparagraph (A)(ii) if the 
Secretary has commenced and is diligently 
prosecuting a civil action in a district court 
of the United States to protect the Federal 
ownership of the patent involved. 
‘‘(D) RIGHT
OF
SECRETARY
TO
INTER-
VENE.—In any civil action under subparagraph 
(A), the Secretary, if not a party, may intervene 
as a matter of right. 
‘‘(E) AWARD
OF
COSTS; 
FILING
OF 
BOND.—In a civil action under subparagraph 
(A), the district court involved may award costs 
of litigation (including reasonable attorney and 
expert witness fees) to any party whenever the 
court determines such an award is appropriate.