‘‘(IV) obtain such other relief as 
the court may consider to be appro-
priate. 
‘‘(ii) NOTICE.— 
‘‘(I) IN GENERAL.—Before filing 
an action under clause (i), the attor-
ney general of the State involved shall 
provide to the Federal Trade Commis-
sion— 
‘‘(aa) written notice of that 
action; and 
‘‘(bb) a copy of the com-
plaint for that action. 
‘‘(II) 
EXEMPTION.—Subclause 
(I) shall not apply with respect to the 
filing of an action by an attorney gen-
eral of a State under this paragraph, 
if the attorney general determines 
that it is not feasible to provide the 
notice described in that subclause be-
fore filing of the action. In such case, 
the attorney general of a State shall 
provide notice and a copy of the com-
plaint to the Federal Trade Commis-
sion at the same time as the attorney 
general files the action. 
‘‘(B) INTERVENTION.— 
‘‘(i) IN GENERAL.—On receiving no-
tice under subparagraph (A)(ii), the Fed-
eral Trade Commission shall have the right 
to intervene in the action that is the sub-
ject of the notice. 
‘‘(ii) EFFECT OF INTERVENTION.—If 
the Federal Trade Commission intervenes 
in an action under subparagraph (A), it 
shall have the right— 
‘‘(I) to be heard with respect to 
any matter that arises in that action; 
and 
‘‘(II) to file a petition for appeal. 
‘‘(C) CONSTRUCTION.—For purposes of 
bringing any civil action under subparagraph 
(A), nothing in this subsection shall be con-
strued to prevent an attorney general of a State 
from exercising the powers conferred on the at-
torney general by the laws of that State to— 
‘‘(i) conduct investigations; 
‘‘(ii) administer oaths or affirmations; 
or
‘‘(iii) compel the attendance of wit-
nesses or the production of documentary 
and other evidence. 
‘‘(D) ACTIONS BY THE COMMISSION.—In 
any case in which an action is instituted by or 
on behalf of the Federal Trade Commission for 
a violation of paragraph (1), a State may not, 
during the pendency of that action, institute an 
action under subparagraph (A) for the same 
violation against any defendant named in the 
complaint in that action. 
‘‘(E) VENUE.—Any action brought under 
subparagraph (A) may be brought in the dis-
trict court of the United States that meets ap-
plicable requirements relating to venue under 
section 1391 of title 28, United States Code. 
‘‘(F) SERVICE OF PROCESS.—In an action 
brought under subparagraph (A), process may 
be served in any district in which the defend-
ant— 
‘‘(i) is an inhabitant; or 
‘‘(ii) may be found. 
‘‘(G) MEASUREMENT
OF
DAMAGES.—In 
any action under this paragraph to enforce a 
cause of action under this subsection in which
there has been a determination that a defend-
ant has violated a provision of this subsection, 
damages may be proved and assessed in the ag-
gregate by statistical or sampling methods, by 
the computation of illegal overcharges or by 
such other reasonable system of estimating ag-
gregate damages as the court in its discretion 
may permit without the necessity of separately 
proving the individual claim of, or amount of 
damage to, persons on whose behalf the suit 
was brought. 
‘‘(H) EXCLUSION
ON
DUPLICATIVE
RE-
LIEF.—The district court shall exclude from the 
amount of monetary relief awarded in an action 
under this paragraph brought by the attorney 
general of a State any amount of monetary re-
lief which duplicates amounts which have been 
awarded for the same injury. 
‘‘(6) EFFECT ON ANTITRUST LAWS.—Nothing 
in this subsection shall be construed to modify, im-
pair, or supersede the operation of the antitrust 
laws. For the purpose of this subsection, the term 
‘antitrust laws’ has the meaning given it in the first 
section of the Clayton Act, except that it includes 
section 5 of the Federal Trade Commission Act to
the extent that such section 5 applies to unfair 
methods of competition. 
‘‘(7) MANUFACTURER.—In this subsection, the 
term ‘manufacturer’ means any entity, including any 
affiliate or licensee of that entity, that is engaged 
in— 
‘‘(A) the production, preparation, propaga-
tion, compounding, conversion, or processing of 
a prescription drug, either directly or indirectly 
by extraction from substances of natural origin, 
or independently by means of chemical syn-
thesis, or by a combination of extraction and 
chemical synthesis; or 
‘‘(B) the packaging, repackaging, labeling, 
relabeling, or distribution of a prescription 
drug.’’. 
(b) PROHIBITED ACTS.—The Federal Food, Drug, 
and Cosmetic Act is amended— 
(1) in section 301 (21 U.S.C. 331), by striking 
paragraph (aa) and inserting the following: 
‘‘(aa)(1) The sale or trade by a pharmacist, or by 
a business organization of which the pharmacist is a part, 
of a qualifying drug that under section 804(a)(2)(A) was 
imported by the pharmacist, other than—
‘‘(A) a sale at retail made pursuant to dis-
pensing the drug to a customer of the pharmacist or 
organization; or 
‘‘(B) a sale or trade of the drug to a pharmacy 
or a wholesaler registered to import drugs under sec-
tion 804. 
‘‘(2) The sale or trade by an individual of a qualifying 
drug that under section 804(a)(2)(B) was imported by the 
individual. 
‘‘(3) The making of a materially false, fictitious, or 
fraudulent statement or representation, or a material 
omission, in a notice under clause (i) of section 
804(g)(2)(B) or in an application required under section 
804(g)(2)(F), or the failure to submit such a notice or 
application. 
‘‘(4) The importation of a drug in violation of a reg-
istration condition or other requirement under section 
804, the falsification of any record required to be main-
tained, or provided to the Secretary, under such section, 
or the violation of any registration condition or other re-
quirement under such section.’’; and 
(2) in section 303(a) (21 U.S.C. 333(a)), by 
striking paragraph (6) and inserting the following: 
‘‘(6) Notwithstanding subsection (a), any person that 
knowingly violates section 301(i) (2) or (3) or section
301(aa)(4) shall be imprisoned not more than 10 years, 
or fined in accordance with title 18, United States Code, 
or both.’’. 
(c) AMENDMENT OF CERTAIN PROVISIONS.— 
(1) IN GENERAL.—Section 801 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 381) is 
amended by striking subsection (g) and inserting the 
following: 
‘‘(g) With respect to a prescription drug that is im-
ported or offered for import into the United States by an 
individual who is not in the business of such importation, 
that is not shipped by a registered exporter under section 
804, and that is refused admission under subsection (a), 
the Secretary shall notify the individual that— 
‘‘(1) the drug has been refused admission be-
cause the drug was not a lawful import under sec-
tion 804; 
‘‘(2) the drug is not otherwise subject to a 
waiver of the requirements of subsection (a); 
‘‘(3) the individual may under section 804 law-
fully import certain prescription drugs from export-
ers registered with the Secretary under section 804; 
and 
‘‘(4) the individual can find information about 
such importation, including a list of registered ex-
porters, on the Internet website of the Food and 
Drug Administration or through a toll-free telephone 
number required under section 804.’’. 
(2) ESTABLISHMENT
REGISTRATION.—Section 
510(i) of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 360(i)) is amended in paragraph (1) by 
inserting after ‘‘import into the United States’’ the 
following: ‘‘, including a drug that is, or may be, im-
ported or offered for import into the United States 
under section 804,’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on the date that 
is 90 days after the date of enactment of this Act. 
(d) EXHAUSTION.— 
(1) IN
GENERAL.—Section 271 of title 35, 
United States Code, is amended— 
(A) by redesignating subsections (h) and 
(i) as (i) and (j), respectively; and 
(B) by inserting after subsection (g) the 
following: 
‘‘(h) It shall not be an act of infringement to use, 
offer to sell, or sell within the United States or to import 
into the United States any patented invention under sec-
tion 804 of the Federal Food, Drug, and Cosmetic Act
that was first sold abroad by or under authority of the 
owner or licensee of such patent.’’. 
(2) RULE OF CONSTRUCTION.—Nothing in the 
amendment made by paragraph (1) shall be con-
strued to affect the ability of a patent owner or li-
censee to enforce their patent, subject to such 
amendment. 
(e) EFFECT OF SECTION 804.— 
(1) IN GENERAL.—Section 804 of the Federal 
Food, Drug, and Cosmetic Act, as added by sub-
section (a), shall permit the importation of quali-
fying drugs (as defined in such section 804) into the 
United States without regard to the status of the 
issuance of implementing regulations— 
(A) from exporters registered under such 
section 804 on the date that is 90 days after 
the date of enactment of this Act; and 
(B) from permitted countries, as defined in 
such section 804, by importers registered under 
such section 804 on the date that is 1 year 
after the date of enactment of this Act. 
(2) REVIEW OF REGISTRATION BY CERTAIN EX-
PORTERS.— 
(A) REVIEW PRIORITY.—In the review of 
registrations submitted under subsection (b) of
such section 804, registrations submitted by en-
tities in Canada that are significant exporters 
of prescription drugs to individuals in the 
United States as of the date of enactment of 
this Act will have priority during the 90 day pe-
riod that begins on such date of enactment. 
(B) PERIOD FOR REVIEW.—During such 
90-day period, the reference in subsection 
(b)(2)(A) of such section 804 to 90 days (relat-
ing to approval or disapproval of registrations) 
is, as applied to such entities, deemed to be 30 
days. 
(C) LIMITATION.—That an exporter in 
Canada exports, or has exported, prescription 
drugs to individuals in the United States on or 
before the date that is 90 days after the date 
of enactment of this Act shall not serve as a 
basis, in whole or in part, for disapproving a 
registration under such section 804 from the 
exporter. 
(D) FIRST
YEAR
LIMIT
ON
NUMBER
OF 
EXPORTERS.—During the 1-year period begin-
ning on the date of enactment of this Act, the 
Secretary of Health and Human Services (re-
ferred to in this section as the ‘‘Secretary’’)
may limit the number of registered exporters 
under such section 804 to not less than 50, so 
long as the Secretary gives priority to those ex-
porters with demonstrated ability to process a 
high volume of shipments of drugs to individ-
uals in the United States. 
(E) SECOND YEAR LIMIT ON NUMBER OF 
EXPORTERS.—During the 1-year period begin-
ning on the date that is 1 year after the date 
of enactment of this Act, the Secretary may 
limit the number of registered exporters under 
such section 804 to not less than 100, so long 
as the Secretary gives priority to those export-
ers with demonstrated ability to process a high 
volume of shipments of drugs to individuals in 
the United States. 
(F) FURTHER LIMIT ON NUMBER OF EX-
PORTERS.—The Secretary shall report to Con-
gress to request the authority to impose a limi-
tation on the number of registered exporters 
under such section 804 during any period be-
ginning on a date that is not less than 2 years 
after the date of enactment of this Act if the 
Secretary determines that—
(i) a limitation on the number of reg-
istered exporters is necessary for the effec-
tive and efficient enforcement of the re-
quirements of such section 804 with re-
spect to such exporters; and 
(ii) such limitation will not restrict 
the ability of individuals to import pre-
scription drugs for personal use from reg-
istered exporters under such section 804. 
(3) LIMITS ON NUMBER OF IMPORTERS.— 
(A) FIRST YEAR LIMIT ON NUMBER OF IM-
PORTERS.—During the 1-year period beginning 
on the date that is 1 year after the date of en-
actment of this Act, the Secretary may limit the 
number of registered importers under such sec-
tion 804 to not less than 100 (of which at least 
a significant number shall be groups of phar-
macies, to the extent feasible given the applica-
tions submitted by such groups), so long as the 
Secretary gives priority to those importers with 
demonstrated ability to process a high volume 
of shipments of drugs imported into the United 
States. 
(B) SECOND YEAR LIMIT ON NUMBER OF 
IMPORTERS.—During the 1-year period begin-
ning on the date that is 2 years after the date 
of enactment of this Act, the Secretary may 
limit the number of registered importers under 
such section 804 to not less than 200 (of which 
at least a significant number shall be groups of 
pharmacies, to the extent feasible given the ap-
plications submitted by such groups), so long as 
the Secretary gives priority to those importers 
with demonstrated ability to process a high vol-
ume of shipments of drugs to individuals in the 
United States. 
(C) FURTHER LIMIT ON NUMBER OF IM-
PORTERS.—The Secretary shall report to Con-
gress to request the authority to impose a limi-
tation on the number of registered importers 
under such section 804 during any period be-
ginning on a date that is not less than 3 years 
after the date of enactment of this Act if the 
Secretary determines that— 
(i) a limitation on the number of reg-
istered importers is necessary for the effec-
tive and efficient enforcement of the re-
quirements of such section 804 with re-
spect to such importers; and
(ii) such limitation will not restrict 
the ability of individuals to purchase quali-
fying drugs imported under such section 
804 or savings available to individuals by 
purchasing such qualifying drugs. 
(4) NOTICES FOR DRUGS FOR IMPORT FROM 
CANADA.—The notice with respect to a qualifying 
drug introduced for commercial distribution in Can-
ada as of the date of enactment of this Act that is 
required under subsection (g)(2)(B)(i) of such sec-
tion 804 shall be submitted to the Secretary not 
later than 30 days after the date of enactment of 
this Act if— 
(A) the U.S. label drug (as defined in such 
section 804) for the qualifying drug is 1 of the 
100 prescription drugs with the highest dollar 
volume of sales in the United States based on 
the 12 calendar month period most recently 
completed before the date of enactment of this 
Act; or 
(B) the notice is a notice under subsection 
(g)(2)(B)(i)(II) of such section 804. 
(5) NOTICE
FOR
DRUGS
FOR
IMPORT
FROM 
OTHER COUNTRIES.—The notice with respect to a 
qualifying drug introduced for commercial distribu-
tion in a permitted country other than Canada as of 
the date of enactment of this Act that is required 
under subsection (g)(2)(B)(i) of such section 804 
shall be submitted to the Secretary not later than 
180 days after the date of enactment of this Act 
if— 
(A) the U.S. label drug for the qualifying 
drug is 1 of the 100 prescription drugs with the 
highest dollar volume of sales in the United 
States based on the 12 calendar month period 
that is first completed on the date that is 120 
days after the date of enactment of this Act; or 
(B) the notice is a notice under subsection 
(g)(2)(B)(i)(II) of such section 804. 
(6) NOTICE FOR OTHER DRUGS FOR IMPORT.— 
(A) GUIDANCE ON SUBMISSION DATES.—
The Secretary shall by guidance establish a se-
ries of submission dates for the notices under 
subsection (g)(2)(B)(i) of such section 804 with 
respect to qualifying drugs introduced for com-
mercial distribution as of the date of enactment 
of this Act and that are not required to be sub-
mitted under paragraph (4) or (5). 
(B) CONSISTENT AND EFFICIENT USE OF 
RESOURCES.—The Secretary shall establish the
dates described under subparagraph (A) so that 
such notices described under subparagraph (A) 
are submitted and reviewed at a rate that al-
lows consistent and efficient use of the re-
sources and staff available to the Secretary for 
such reviews. Review of all such notices shall be 
completed not later than 5 years after the date 
of enactment of this Act. 
(C) PRIORITY FOR DRUGS WITH HIGHER 
SALES.—The Secretary shall establish the dates 
described under subparagraph (A) so that the 
Secretary reviews the notices described under 
such subparagraph with respect to qualifying 
drugs with higher dollar volume of sales in the 
United States before the notices with respect to 
drugs with lower sales in the United States. 
(7) NOTICES FOR DRUGS APPROVED AFTER EF-
FECTIVE
DATE.—The notice required under sub-
section (g)(2)(B)(i) of such section 804 for a quali-
fying drug first introduced for commercial distribu-
tion in a permitted country (as defined in such sec-
tion 804) after the date of enactment of this Act 
shall be submitted to and reviewed by the Secretary 
as provided under subsection (g)(2)(B) of such sec-
tion 804, without regard to paragraph (4), (5), or 
(6). 
(8) REPORT.—Beginning with fiscal year 2006, 
not later than 90 days after the end of each fiscal 
year during which the Secretary reviews a notice re-
ferred to in paragraph (4), (5), or (6), the Secretary 
shall submit a report to Congress concerning the 
progress of the Food and Drug Administration in re-
viewing the notices referred to in paragraphs (4), 
(5), and (6). 
(9) USER FEES.— 
(A) EXPORTERS.—When establishing an 
aggregate total of fees to be collected from ex-
porters under subsection (f)(2) of such section 
804, the Secretary shall, under subsection 
(f)(3)(C)(i) of such section 804, estimate the 
total price of drugs imported under subsection 
(a) of such section 804 into the United States 
by registered exporters during fiscal year 2006 
to be $1,000,000,000. 
(B) IMPORTERS.—When establishing an 
aggregate total of fees to be collected from im-
porters under subsection (e)(2) of such section 
804, the Secretary shall, under subsection 
(e)(3)(C)(i) of such section 804, estimate the