IB
Union Calendar No. 410
103D CONGRESS
2D SESSION
H. R. 4865
[Report No. 103–746]
To amend the Federal Food, Drug, and Cosmetic Act, the Public Health
Service Act, and the Orphan Drug Act to revise the provisions of such
Acts relating to orphan drugs.
IN THE HOUSE OF REPRESENTATIVES
AUGUST 1, 1994
Mr. WAXMAN (for himself and Mr. STUDDS) introduced the following bill;
which was referred to the Committee on Energy and Commerce
SEPTEMBER 26, 1994
Reported with an amendment, committed to the Committee of the Whole
House on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
[For text of introduced bill, see copy of bill as introduced on August 1, 1994]
A BILL
To amend the Federal Food, Drug, and Cosmetic Act, the
Public Health Service Act, and the Orphan Drug Act
to revise the provisions of such Acts relating to orphan
drugs.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND REFERENCE.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Orphan Drug Act Amendments of 1994’’.
(b) REFERENCE.—Whenever in this Act (other than
sections 5 and 6) an amendment or repeal is expressed in
terms of an amendment to, or repeal of, a section or other
provision, the reference shall be considered to be made to
a section or other provision of the Federal Food, Drug, and
Cosmetic Act.
SEC. 2. PERIOD OF EXCLUSIVITY.
(a) INITIAL PERIOD.—Subsection (a) of section 527
(21 U.S.C. 360cc) is amended—
(1) by inserting ‘‘(1)’’ after ‘‘(a)’’,
(2) by redesignating paragraphs (1), (2), and (3)
as subparagraphs (A), (B), and (C), respectively,
(3) by striking ‘‘seven years’’ and inserting ‘‘4
years’’, and
(4) by striking ‘‘505(c)(2)’’ and inserting
‘‘505(c)(1)(B)’’.
(b) ADDITIONAL PERIOD.—Subsection (a) of such sec-
tion 527 (21 U.S.C. 360cc) (as amended by subsection (a))
is amended by adding at the end the following:
‘‘(2) The holder of the approved application, certifi-
cation, or license of a drug to which the 4-year period of
exclusivity applies under paragraph (1) may, after the ex-
piration of 31⁄2 years of such period but not later than 90
days before the expiration of such period, apply to the Sec-
retary for a 3-year extension of such period. Such an appli-
cation shall contain such information as the Secretary de-
termines is necessary to evaluate such application.
‘‘(3) The Secretary shall approve an application sub-
mitted under paragraph (2) if the applicant—
‘‘(A) demonstrates that the drug has a limited
commercial potential, as determined under regula-
tions of the Secretary, on the basis of—
‘‘(i) total sales revenue for such drug during
the 4-year period of exclusivity under paragraph
(1), or
‘‘(ii) factors other than total sales revenue
identified by the Secretary, and
‘‘(B) makes such demonstration on the basis of
the regulations of the Secretary referred to in sub-
paragraph (A) which were in effect—
‘‘(i) on the date—
‘‘(I) such drug received its designation
under section 526(a)(1), or
‘‘(II) such applicant applied for an ex-
emption for such drug under section 505(i)
or clause (3) of section 507(d),
whichever first occurs, or
‘‘(ii) if the date under clause (i) occurred
before the date such regulations were in effect, on
the date such regulations were in effect.’’.
(c) CONFORMING AMENDMENTS.—Section 527(b) (21
U.S.C. 360cc(b)) is amended—
(1) by striking ‘‘during the seven-year period’’
and inserting ‘‘during the applicable period of exclu-
sivity under subsection (a)’’,
(2) in paragraph (2), by striking ‘‘such seven
year period’’ and inserting ‘‘the applicable period of
exclusivity under subsection (a)’’,
(3) by striking ‘‘507,,’’ and inserting ‘‘507,’’, and
(4) in paragraph (1), by striking ‘‘The Sec-
retary’’ and inserting ‘‘the Secretary’’.
(d) EFFECTIVE DATE.—The amendments made by
subsections (a) and (b) shall not apply to a drug—
(1) for which an application under section 505
or 507 of the Federal Food, Drug, and Cosmetic Act
or section 351 of the Public Health Service Act was
submitted or approved before March 1, 1994, or
(2) for which an exemption under section 505(i)
or clause (3) of section 507(d) of the Federal Food,
Drug, and Cosmetic Act was in effect before March 1,
1994, for which human clinical trials were actively
being conducted before such date, and for which an
application for designation under section 526 of such
Act was submitted before the date of enactment of the
Orphan Drug Act Amendments of 1994.
The 7-year period of exclusivity provided by section 527(a)
of the Federal Food, Drug, and Cosmetic Act before the date
of the enactment of this Act shall, after such date, apply
to a drug described in paragraph (1) or (2).
(e) REGULATIONS.—The Secretary shall issue final
regulations to implement paragraphs (2) and (3) of section
527(a) of the Federal Food, Drug, and Cosmetic Act (21
U.S.C. 360cc) (as added by subsection (b)) not later than
6 months after the date of the enactment of this Act.
SEC. 3. DESIGNATIONS.
(a) IN
GENERAL.—Section 526(a)(2) (21 U.S.C.
360bb(a)(2)) is amended to read as follows:
‘‘(2) For purposes of paragraph (1), the term ‘rare dis-
ease or condition’ means any disease or condition which—
‘‘(A) affects fewer than 200,000 persons in the
United States determined on the basis of—
‘‘(i) the facts and circumstances as of the
date the request for designation of the drug
under this subsection is made, and
‘‘(ii) projections as to the number of persons
who will be affected by the disease or condition
on a date which is 3 years from date such re-
quest was made, or
‘‘(B) affects more than 200,000 persons in the
United States and for which there is no reasonable ex-
pectation that the cost of developing and making
available in the United States a drug for such disease
or condition will be recovered from sales in the Unit-
ed States of such drug.’’.
(b) 
EXCLUSIVITY.—Section 
527(b) 
(21 
U.S.C.
360cc(b)) is amended—
(1) by striking ‘‘or’’ at the end of paragraph (1),
(2) by striking the period at the end of para-
graph (2) and inserting a semicolon, and
(3) by adding at the end the following:
‘‘(3) such drug was designated under section
526(a)(1) for a rare disease or condition described in
paragraph (2) of section 526(a) and, after such des-
ignation, it is determined that such disease or condi-
tion affects more than 200,000 persons in the United
States; or’’.
SEC. 4. SIMULTANEOUS DEVELOPMENT.
(a) 
IN
GENERAL.—Section 
527(b) 
(21 
U.S.C.
360cc(b)), as amended by section 3(b), is amended by in-
serting ‘‘(1)’’ after ‘‘(b)’’, by redesignating paragraphs (1),
(2), and (3) as subparagraphs (A), (B), and (C), respec-
tively, by striking ‘‘for a person who is not’’ and by insert-
ing ‘‘for an applicant who is not’’, and by adding at the
end the following:
‘‘(D) the Secretary finds, after providing the
holder, such applicant, and any other interested per-
son an opportunity to present their views, that the
drugs of the holder and such applicant were developed
simultaneously.
The Secretary shall make a decision on a request for a find-
ing under subparagraph (D) not later than 60 days after
the filing of the request.
‘‘(2) For purposes of paragraph (1)(D), drugs of a
holder and an applicant shall be considered to be developed
simultaneously only if—
‘‘(A) the applicant requested that its drug be des-
ignated under section 526 no later than 6 months
after publication of the designation under section
526(c) of the holder’s drug,
‘‘(B) the applicant initiated the human clinical
trials that the applicant relied on in its application
for such approval, certification, or license not more
than 12 months after the date the holder initiated the
human clinical trials that the holder relied on in its
application for such approval, certification, or
license, and
‘‘(C) the applicant submitted such application,
including the reports of the clinical and animal stud-
ies necessary for approval, certification, or license,
not more than 12 months after the holder submitted
its application, including such reports, for such
action.
‘‘(3) Paragraph (1)(D) does not apply to a drug—
‘‘(A) for which an application under section 505
or 507 or section 351 of the Public Health Service Act
was submitted or approved before March 1, 1994, or
‘‘(B) for which an exemption under section
505(i) or clause (3) of section 507(d) was in effect be-
fore March 1, 1994, for which human clinical trials
were actively being conducted before such date, and
for which an application for designation under sec-
tion 526 was submitted before the date of enactment
of the Orphan Drug Act Amendments of 1994.’’.
(b) 
PUBLICATION.—Section 
526(c) 
(21 
U.S.C.
360bb(c)) is amended—
(1) by inserting ‘‘for a rare disease or condition’’
after ‘‘(a)’’, and
(2) by striking out ‘‘shall be made available to
the public’’ and inserting in lieu thereof ‘‘shall be
promptly published in the Federal Register and other-
wise made available to the public in a manner de-
signed to notify persons who have such disease or con-
dition’’.
SEC. 5. OFFICE FOR ORPHAN DISEASES AND CONDITIONS.
Section 227 of the Public Health Service Act (42
U.S.C. 236) is amended—
(1) by amending subsection (a) to read as
follows:
‘‘(a) There is established in the Department of Health
and Human Services an Office for Orphan Diseases and
Conditions. Such Office shall be established at a level within
the Department with sufficient authority to assure full im-
plementation of the functions and responsibilities estab-
lished by this section.’’,
(2) by striking ‘‘Board’’ each place the term ap-
pears and inserting ‘‘Office’’,
(3) by striking ‘‘drugs and devices’’ in subsection
(b) and inserting ‘‘drugs, devices, and medical foods’’,
(4) by inserting ‘‘of chapter V’’ after ‘‘subchapter
B’’ in subsection (c)(1)(A),
(5) by adding at the end the following new sub-
section:
‘‘(f)(1) There is established in the Office an advisory
committee to advise the Office in carrying out the functions
of the Office under this section.
‘‘(2) The advisory committee shall be comprised of 11
members appointed by the Secretary, in consultation with
the Office and the Commissioner of Food and Drugs, from
persons knowledgeable about rare diseases and conditions,
including—
‘‘(A) 5 representatives of organizations of persons
with rare diseases or conditions;
‘‘(B) 3 research scientists; and
‘‘(C) 3 representatives of health-related compa-
nies.
‘‘(3) The Secretary shall also appoint, as liaisons to
the advisory committee, individuals from the Food and
Drug Administration, the National Institutes of Health,
and other appropriate Federal agencies.
‘‘(4) Vacancies occurring in the membership of the ad-
visory committee shall be filled in the same manner as the
original appointment for the position being vacated. Vacan-
cies shall not affect the power of the remaining members
to execute the duties of the advisory committee.
‘‘(5) Members of the advisory committee, and liaisons
to the advisory committee, shall not be compensated, but
shall receive travel expenses, including per diem in lieu of
subsistence, at rates authorized for employees of agencies
under subchapter 1 of chapter 57 of title 5, United States
Code, for each day the member or liaison is engaged in the
performance of duties away from the home or regular place
of business of the member or liaison.
‘‘(6) Notwithstanding section 1342 of title 31, United
States Code, the advisory committee may accept the vol-
untary services provided by a member of the advisory com-
mittee or a liaison to the advisory committee.’’, and
(6) by amending the section heading to read as
follows: ‘‘OFFICE FOR ORPHAN DISEASES AND CONDI-
TIONS’’.
SEC. 6. AUTHORIZATION FOR ORPHAN DRUG ACT.
Section 5(c) of the Orphan Drug Act (21 U.S.C.
360ee(c)) is amended by striking ‘‘$10,000,000’’ and all
that follows and inserting ‘‘$20,000,000 for fiscal year
1995, $25,000,000 for fiscal year 1996, and $30,000,000 for
fiscal year 1997.’’.