Drug Supply Chain Security Act, the Secretary 
shall finalize guidance specifying whether and 
under what circumstances product that is not 
labeled with a product identifier and that is in 
the pharmaceutical distribution supply chain at 
the time of the effective date of the require-
ments of this section shall be exempted from 
the requirements of this section. 
‘‘(B) TRACING.—For a product that en-
tered the pharmaceutical distribution supply 
chain prior to January 1, 2015— 
‘‘(i) authorized trading partners shall 
be exempt from providing transaction in-
formation as required under subsections 
(b)(1)(A)(i), 
(c)(1)(A)(ii), 
(d)(1)(A)(ii), 
and (e)(1)(A)(ii); 
‘‘(ii) 
transaction 
history 
required 
under this section shall begin with the 
owner of such product on such date; and 
‘‘(iii) the owners of such product on 
such date shall be exempt from asserting 
receipt of transaction information and 
transaction statement from the prior owner 
as required under this section.
‘‘(6) WHOLESALE
DISTRIBUTOR
LICENSES.— 
Notwithstanding section 581(9)(A), until the effec-
tive date of the wholesale distributor licensing regu-
lations under section 583, the term ‘licensed’ or ‘au-
thorized’, as it relates to a wholesale distributor with 
respect to prescription drugs, shall mean a wholesale 
distributor with a valid license under State law. 
‘‘(7) THIRD-PARTY
LOGISTICS
PROVIDER
LI-
CENSES.—Until the effective date of the third-party 
logistics provider licensing regulations under section 
584, a third-party logistics provider shall be consid-
ered ‘licensed’ under section 581(9)(B) unless the 
Secretary has made a finding that the third-party lo-
gistics provider does not utilize good handling and 
distribution practices and publishes notice thereof. 
‘‘(8) LABEL CHANGES.—Changes made to pack-
age labels solely to incorporate the product identifier 
may be submitted to the Secretary in the annual re-
port of an establishment, in accordance with section 
314.70(d) of chapter 21, Code of Federal Regula-
tions (or any successor regulation). 
‘‘(9) PRODUCT IDENTIFIERS.—With respect to 
any requirement relating to product identifiers under 
this subchapter—
‘‘(A) unless the Secretary allows, through 
guidance, the use of other technologies for data 
instead of or in addition to the technologies de-
scribed in clauses (i) and (ii), the applicable 
data— 
‘‘(i) shall be included in a 2-dimen-
sional data matrix barcode when affixed to, 
or imprinted upon, a package; and 
‘‘(ii) shall be included in a linear or 2- 
dimensional data matrix barcode when af-
fixed to, or imprinted upon, a homo-
geneous case; and 
‘‘(B) verification of the product identifier 
may occur by using human-readable or ma-
chine-readable methods. 
‘‘(b) MANUFACTURER REQUIREMENTS.— 
‘‘(1) PRODUCT TRACING.— 
‘‘(A) IN
GENERAL.—Beginning not later 
than January 1, 2015, a manufacturer shall— 
‘‘(i) prior to, or at the time of, each 
transaction in which such manufacturer 
transfers ownership of a product, provide 
the subsequent owner with transaction his-
tory, transaction information, and a trans-
action statement, in a single document in 
an paper or electronic format; and 
‘‘(ii) capture the transaction informa-
tion (including lot level information), 
transaction history, and transaction state-
ment for each transaction and maintain 
such information, history, and statement 
for not less than 6 years after the date of 
the transaction. 
‘‘(B) REQUESTS
FOR
INFORMATION.— 
Upon a request by the Secretary or other ap-
propriate Federal or State official, in the event 
of a recall or for the purpose of investigating a 
suspect product or an illegitimate product, a 
manufacturer shall, not later than 1 business 
day, and not to exceed 48 hours, after receiving 
the request, or in other such reasonable time as 
determined by the Secretary, based on the cir-
cumstances of the request, provide the applica-
ble transaction information, transaction history, 
and transaction statement for the product. 
‘‘(C) ELECTRONIC FORMAT.— 
‘‘(i) IN
GENERAL.—Beginning not 
later than 4 years after the date of enact-
ment of the Drug Supply Chain Security
Act, except as provided under clause (ii), a 
manufacturer shall provide the transaction 
information, 
transaction 
history, 
and 
transaction statement required under sub-
paragraph (A)(i) in electronic format. 
‘‘(ii) EXCEPTION.—A manufacturer 
may continue to provide the transaction in-
formation, transaction history, and trans-
action statement required under subpara-
graph (A)(i) in a paper format to a li-
censed health care practitioner authorized 
to prescribe medication under State law or 
other licensed individual under the super-
vision or direction of such a practitioner 
who dispenses product in the usual course 
of professional practice. 
‘‘(2) PRODUCT IDENTIFIER.— 
‘‘(A) IN
GENERAL.—Beginning not later 
than 4 years after the date of enactment of the 
Drug Supply Chain Security Act, a manufac-
turer shall affix or imprint a product identifier 
to each package and homogenous case of a 
product intended to be introduced in a trans-
action into commerce. Such manufacturer shall 
maintain the product identifier information for
such product for not less than 6 years after the 
date of the transaction. 
‘‘(B) EXCEPTION.—A package that is re-
quired to have a standardized numerical identi-
fier is not required to have a unique device 
identifier. 
‘‘(3) AUTHORIZED
TRADING
PARTNERS.—Be-
ginning not later than January 1, 2015, the trading 
partners of a manufacturer may be only authorized 
trading partners. 
‘‘(4) VERIFICATION.—Beginning not later than 
January 1, 2015, a manufacturer shall have systems 
in place to enable the manufacturer to comply with 
the following requirements: 
‘‘(A) SUSPECT PRODUCT.— 
‘‘(i) IN
GENERAL.—Upon making a 
determination that a product in the posses-
sion or control of the manufacturer is a 
suspect product, or upon receiving a re-
quest for verification from the Secretary 
that has made a determination that a 
product within the possession or control of 
a manufacturer is a suspect product, a 
manufacturer shall—
‘‘(I) quarantine such product 
within the possession or control of the 
manufacturer from product intended 
for distribution until such product is 
cleared or dispositioned; and 
‘‘(II) promptly conduct an inves-
tigation in coordination with trading 
partners, as applicable, to determine 
whether the product is an illegitimate 
product, which shall include validating 
any applicable transaction history and 
transaction information in the posses-
sion of the manufacturer and other-
wise investigating to determine wheth-
er the product is an illegitimate prod-
uct, and, beginning 4 years after the 
date of enactment of the Drug Supply 
Chain Security Act, verifying the 
product at the package level, including 
the standardized numerical identifier. 
‘‘(ii) 
CLEARED
PRODUCT.—If 
the 
manufacturer makes the determination 
that a suspect product is not an illegit-
imate product, the manufacturer shall 
promptly notify the Secretary, if applica-
ble, of such determination and such prod-
uct may be further distributed. 
‘‘(iii) 
RECORDS.—A 
manufacturer 
shall keep records of the investigation of a 
suspect product for not less than 6 years 
after the conclusion of the investigation. 
‘‘(B) ILLEGITIMATE PRODUCT.— 
‘‘(i) IN GENERAL.—Upon determining 
that a product in the possession or control 
of a manufacturer is an illegitimate prod-
uct, the manufacturer shall, in a manner 
consistent with the systems and processes 
of such manufacturer— 
‘‘(I) quarantine such product 
within the possession or control of the 
manufacturer from product intended 
for distribution until such product is 
dispositioned; 
‘‘(II) disposition the illegitimate 
product within the possession or con-
trol of the manufacturer; 
‘‘(III) take reasonable and appro-
priate steps to assist a trading part-
ner to disposition an illegitimate prod-
uct not in the possession or control of 
the manufacturer; and 
‘‘(IV) retain a sample of the 
product for further physical examina-
tion or laboratory analysis of the 
product by the manufacturer or Sec-
retary (or other appropriate Federal 
or State official) upon request by the 
Secretary (or other appropriate Fed-
eral or State official), as necessary 
and appropriate. 
‘‘(ii) MAKING A NOTIFICATION.— 
‘‘(I) ILLEGITIMATE
PRODUCT.— 
Upon determining that a product in 
the possession or control of the manu-
facturer is an illegitimate product, the 
manufacturer shall notify the Sec-
retary and all immediate trading part-
ners that the manufacturer has reason 
to believe may have received such ille-
gitimate product of such determina-
tion not later than 24 hours after 
making such determination. 
‘‘(II) HIGH
RISK
OF
ILLEGIT-
IMACY.—A manufacturer shall notify
the Secretary and immediate trading 
partners that the manufacturer has 
reason to believe may have in the 
trading partner’s possession a product 
manufactured by, or purported to be a 
product manufactured by, the manu-
facturer not later than 24 hours after 
determining or being notified by the 
Secretary or a trading partner that 
there is a high risk that such product 
is an illegitimate product. For pur-
poses of this subclause, a ‘high risk’ 
may include a specific high risk that 
could increase the likelihood that ille-
gitimate product will enter the phar-
maceutical distribution supply chain 
and other high risks as determined by 
the Secretary in guidance pursuant to 
subsection (h). 
‘‘(iii) RESPONDING
TO
A
NOTIFICA-
TION.—Upon the receipt of a notification 
from the Secretary or a trading partner 
that a determination has been made that a 
product is an illegitimate product, a manu-
facturer shall identify all illegitimate prod-
uct subject to such notification that is in 
the possession or control of the manufac-
turer, including any product that is subse-
quently received, and shall perform the ac-
tivities described in subparagraph (A). 
‘‘(iv) 
TERMINATING
A
NOTIFICA-
TION.—Upon making a determination, in 
consultation with the Secretary, that a no-
tification is no longer necessary, a manu-
facturer shall promptly notify immediate 
trading partners that the manufacturer no-
tified pursuant to clause (ii) that such no-
tification has been terminated. 
‘‘(v) RECORDS.—A manufacturer shall 
keep records of the disposition of an illegit-
imate product for not less than 6 years 
after the conclusion of the disposition. 
‘‘(C) REQUESTS FOR VERIFICATION.—Be-
ginning 4 years after the date of enactment of 
the Drug Supply Chain Security Act, upon re-
ceiving a request for verification from an au-
thorized repackager, wholesale distributor, or 
dispenser that is in possession or control of a 
product such person believes to be manufac-
tured by such manufacturer, a manufacturer
base developed or operated by another entity. 
The owner of such database shall establish the 
requirements and processes to respond to re-
quests and may provide for data access to other 
members of the pharmaceutical distribution 
supply chain, as appropriate. The development 
and operation of such a database shall not re-
lieve a manufacturer of the requirement under 
this paragraph to respond to a request for 
verification submitted by means other than a 
secure electronic database. 
‘‘(E) SALEABLE
RETURNED
PRODUCT.— 
Beginning 4 years after the date of enactment 
of the Drug Supply Chain Security Act (except 
as provided pursuant to subsection (a)(5)), 
upon receipt of a returned product that the 
manufacturer intends to further distribute, be-
fore further distributing such product, the man-
ufacturer shall verify the product identifier, in-
cluding the standardized numerical identifier, 
for each sealed homogeneous case of such prod-
uct or, if such product is not in a sealed homo-
geneous case, verify the product identifier, in-
cluding the standardized numerical identifier, 
on each package.
‘‘(F) NONSALEABLE
RETURNED
PROD-
UCT.—A manufacturer may return a nonsale-
able product to the manufacturer or repack-
ager, to the wholesale distributor from whom 
such product was purchased, or to a person act-
ing on behalf of such a person, including a re-
turns processor, without providing the informa-
tion described in paragraph (1)(A)(i). 
‘‘(c) WHOLESALE DISTRIBUTOR REQUIREMENTS.— 
‘‘(1) PRODUCT TRACING.— 
‘‘(A) IN
GENERAL.—Beginning not later 
than January 1, 2015, the following require-
ments shall apply to wholesale distributors: 
‘‘(i) A wholesale distributor shall not 
accept ownership of a product unless the 
previous owner prior to, or at the time of, 
the transaction provides the transaction 
history, transaction information, and a 
transaction statement for the product, as 
applicable under this subparagraph. 
‘‘(ii)(I)(aa) If the wholesale dis-
tributor purchased a product directly from 
the manufacturer, the exclusive distributor 
of the manufacturer, or a repackager that 
purchased directly from the manufacturer,
then prior to, or at the time of, each trans-
action in which the wholesale distributor 
transfers ownership of a product, the 
wholesale distributor shall provide to the 
subsequent purchaser— 
‘‘(AA) a transaction statement, 
which shall state that such wholesale 
distributor, or a member of the affil-
iate of such wholesale distributor, pur-
chased the product directly from the 
manufacturer, exclusive distributor of 
the manufacturer, or repackager that 
purchased the product directly from 
the manufacturer; and 
‘‘(BB) subject to subclause (II), 
the transaction history and trans-
action information. 
‘‘(bb) The wholesale distributor shall 
provide the transaction history, transaction 
information, and transaction statement 
under item (aa)— 
‘‘(AA) if provided to a dis-
penser, on a single document in a 
paper or electronic format; and
‘‘(BB) if provided to a 
wholesale 
distributor, 
through 
any combination of self-generated 
paper, electronic data, or manu-
facturer-provided information on 
the product package. 
‘‘(II) For purposes of transactions de-
scribed in subclause (I), transaction his-
tory and transaction information shall not 
be required to include the lot number of 
the product, the initial transaction date, or 
the initial shipment date from the manu-
facturer (as defined in subparagraphs (F), 
(G), and (H) of section 581(26)). 
‘‘(iii) If the wholesale distributor did 
not purchase a product directly from the 
manufacturer, the exclusive distributor of 
the manufacturer, or a repackager that 
purchased directly from the manufacturer, 
as described in clause (ii), then prior to, or 
at the time of, each transaction or subse-
quent transaction, the wholesale distributor 
shall provide to the subsequent purchaser a 
transaction statement, transaction history, 
and transaction information, in a paper or
electronic format that complies with the 
guidance document issued under sub-
section (a)(2). 
‘‘(iv) For the purposes of clause (iii), 
the transaction history supplied shall begin 
only with the wholesale distributor de-
scribed in clause (ii)(I), but the wholesale 
distributor described in clause (iii) shall in-
form the subsequent purchaser that such 
wholesale distributor received a direct pur-
chase statement from a wholesale dis-
tributor described in clause (ii)(I). 
‘‘(v) A wholesale distributor shall— 
‘‘(I) capture the transaction in-
formation (including lot level informa-
tion) consistent with the requirements 
of this section, transaction history, 
and transaction statement for each 
transaction described in clauses (i), 
(ii), and (iii) and maintain such infor-
mation, history, and statement for not 
less than 6 years after the date of the 
transaction; and 
‘‘(II) maintain the confidentiality 
of the transaction information (includ-
ing any lot level information con-
sistent with the requirements of this 
section), 
transaction 
history, 
and 
transaction statement for a product in 
a manner that prohibits disclosure to 
any person other than the Secretary 
or other appropriate Federal or State 
official, except to comply with clauses 
(ii) and (iii), and, as applicable, pur-
suant to an agreement under subpara-
graph (D). 
‘‘(B) RETURNS.— 
‘‘(i) SALEABLE
RETURNS.—Notwith-
standing subparagraph (A)(i), the fol-
lowing shall apply: 
‘‘(I) REQUIREMENTS.—Until the 
date that is 6 years after the date of 
enactment of the Drug Supply Chain 
Security Act (except as provided pur-
suant to subsection (a)(5)), a whole-
sale distributor may accept returned 
product from a dispenser or repack-
ager pursuant to the terms and condi-
tions of any agreement between the 
parties, and, notwithstanding sub-
paragraph (A)(ii), may distribute such 
returned product without providing 
the transaction history. For trans-
actions subsequent to the return, the 
transaction history of such product 
shall begin with the wholesale dis-
tributor that accepted the returned 
product, consistent with the require-
ments of this subsection. 
‘‘(II) 
ENHANCED
REQUIRE-
MENTS.—Beginning 6 years after the 
date of enactment of the Drug Supply 
Chain Security Act (except as pro-
vided pursuant to subsection (a)(5)), 
a wholesale distributor may accept re-
turned product from a dispenser or 
repackager only if the wholesale dis-
tributor can associate returned prod-
uct with the transaction information 
and transaction statement associated 
with that product. For all trans-
actions after such date, the trans-
action history, as applicable, of such 
product shall begin with the wholesale 
distributor that accepted and verified
the returned product. For purposes of 
this subparagraph, the transaction in-
formation and transaction history, as 
applicable, need not include trans-
action dates if it is not reasonably 
practicable to obtain such dates. 
‘‘(ii) 
NONSALEABLE
RETURNS.—A 
wholesale distributor may return a non-
saleable product to the manufacturer or re-
packager, to the wholesale distributor from 
whom such product was purchased, or to a 
person acting on behalf of such a person, 
including a returns processor, without pro-
viding the information required under sub-
paragraph (A)(i). 
‘‘(C) REQUESTS
FOR
INFORMATION.— 
Upon a request by the Secretary or other ap-
propriate Federal or State official, in the event 
of a recall or for the purpose of investigating a 
suspect product or an illegitimate product, a 
wholesale distributor shall, not later than 1 
business day, and not to exceed 48 hours, after 
receiving the request or in other such reason-
able time as determined by the Secretary, based 
on the circumstances of the request, provide the
applicable transaction information, transaction 
history, and transaction statement for the prod-
uct. 
‘‘(D) TRADING PARTNER AGREEMENTS.— 
Beginning 6 years after the date of enactment 
of the Drug Supply Chain Security Act, a 
wholesale distributor may disclose the trans-
action information, including lot level informa-
tion, transaction history, or transaction state-
ment of a product to the subsequent purchaser 
of the product, pursuant to a written agreement 
between such wholesale distributor and such 
subsequent purchaser. Nothing in this subpara-
graph shall be construed to limit the applica-
bility of subparagraphs (A) through (C). 
‘‘(2) 
PRODUCT
IDENTIFIER.—Beginning 
years after the date of enactment of the Drug Sup-
ply Chain Security Act, a wholesale distributor may 
engage in transactions involving a product only if 
such product is encoded with a product identifier 
(except as provided pursuant to subsection (a)(5)). 
‘‘(3) AUTHORIZED
TRADING
PARTNERS.—Be-
ginning not later than January 1, 2015, the trading 
partners of a wholesale distributor may be only au-
thorized trading partners.
‘‘(4) VERIFICATION.—Beginning not later than 
January 1, 2015, a wholesale distributor shall have 
systems in place to enable the wholesale distributor 
to comply with the following requirements: 
‘‘(A) SUSPECT PRODUCT.— 
‘‘(i) IN
GENERAL.—Upon making a 
determination that a product in the posses-
sion or control of a wholesale distributor is 
a suspect product, or upon receiving a re-
quest for verification from the Secretary 
that has made a determination that a 
product within the possession or control of 
a wholesale distributor is a suspect prod-
uct, a wholesale distributor shall— 
‘‘(I) quarantine such product 
within the possession or control of the 
wholesale distributor from product in-
tended for distribution until such 
product is cleared or dispositioned; 
and 
‘‘(II) promptly conduct an inves-
tigation in coordination with trading 
partners, as applicable, to determine 
whether the product is an illegitimate 
product, which shall include validating
any applicable transaction history and 
transaction information in the posses-
sion of the wholesale distributor and 
otherwise investigating to determine 
whether the product is an illegitimate 
product, and, beginning 6 years after 
the date of enactment of the Drug 
Supply Chain Security Act (except as 
provided 
pursuant 
to 
subsection 
(a)(5)), verifying the product at the 
package level, including the standard-
ized numerical identifier. 
‘‘(ii) 
CLEARED
PRODUCT.—If 
the 
wholesale distributor determines that a 
suspect product is not an illegitimate prod-
uct, the wholesale distributor shall prompt-
ly notify the Secretary, if applicable, of 
such determination and such product may 
be further distributed. 
‘‘(iii) RECORDS.—A wholesale dis-
tributor shall keep records of the investiga-
tion of a suspect product for not less than 
6 years after the conclusion of the inves-
tigation. 
‘‘(B) ILLEGITIMATE PRODUCT.—
‘‘(i) 
IN
GENERAL.—Upon 
deter-
mining, in coordination with the manufac-
turer, that a product in the possession or 
control of a wholesale distributor is an ille-
gitimate product, the wholesale distributor 
shall, in a manner that is consistent with 
the systems and processes of such whole-
sale distributor— 
‘‘(I) quarantine such product 
within the possession or control of the 
wholesale distributor from product in-
tended for distribution until such 
product is dispositioned; 
‘‘(II) disposition the illegitimate 
product within the possession or con-
trol of the wholesale distributor; 
‘‘(III) take reasonable and appro-
priate steps to assist a trading part-
ner to disposition an illegitimate prod-
uct not in the possession or control of 
the wholesale distributor; and 
‘‘(IV) retain a sample of the 
product for further physical examina-
tion or laboratory analysis of the 
product by the manufacturer or Sec-
retary (or other appropriate Federal 
or State official) upon request by the 
manufacturer or Secretary (or other 
appropriate Federal or State official), 
as necessary and appropriate. 
‘‘(ii) 
MAKING
A
NOTIFICATION.— 
Upon determining that a product in the 
possession or control of the wholesale dis-
tributor is an illegitimate product, the 
wholesale distributor shall notify the Sec-
retary and all immediate trading partners 
that the wholesale distributor has reason 
to believe may have received such illegit-
imate product of such determination not 
later than 24 hours after making such de-
termination. 
‘‘(iii) RESPONDING
TO
A
NOTIFICA-
TION.—Upon the receipt of a notification 
from the Secretary or a trading partner 
that a determination has been made that a 
product is an illegitimate product, a whole-
sale distributor shall identify all illegit-
imate product subject to such notification 
that is in the possession or control of the 
wholesale distributor, including any prod-
uct that is subsequently received, and shall 
perform the activities described in subpara-
graph (A). 
‘‘(iv) 
TERMINATING
A
NOTIFICA-
TION.—Upon making a determination, in 
consultation with the Secretary, that a no-
tification is no longer necessary, a whole-
sale distributor shall promptly notify im-
mediate trading partners that the whole-
sale distributor notified pursuant to clause 
(ii) that such notification has been termi-
nated. 
‘‘(v) 
RECORDS.—A 
wholesale 
dis-
tributor shall keep records of the disposi-
tion of an illegitimate product for not less 
than 6 years after the conclusion of the 
disposition. 
‘‘(C) ELECTRONIC
DATABASE.—A whole-
sale distributor may satisfy the requirements of 
this paragraph by developing a secure electronic 
database or utilizing a secure electronic data-
base developed or operated by another entity. 
The owner of such database shall establish the 
requirements and processes to respond to re-
quests and may provide for data access to other
members of the pharmaceutical distribution 
supply chain, as appropriate. The development 
and operation of such a database shall not re-
lieve a wholesale distributor of the requirement 
under 
this 
paragraph 
to 
respond 
to 
a 
verification request submitted by means other 
than a secure electronic database. 
‘‘(D) VERIFICATION
OF
SALEABLE
RE-
TURNED
PRODUCT.—Beginning 6 years after 
the date of enactment of the Drug Supply 
Chain Security Act, upon receipt of a returned 
product that the wholesale distributor intends 
to further distribute, before further distributing 
such product, the wholesale distributor shall 
verify the product identifier, including the 
standardized numerical identifier, for each 
sealed homogeneous case of such product or, if 
such product is not in a sealed homogeneous 
case, verify the product identifier, including the 
standardized numerical identifier, on each pack-
age. 
‘‘(d) DISPENSER REQUIREMENTS.— 
‘‘(1) PRODUCT TRACING.— 
‘‘(A) IN
GENERAL.—Beginning July 1, 
2015, a dispenser—
‘‘(i) shall not accept ownership of a 
product, unless the previous owner prior 
to, or at the time of, the transaction, pro-
vides transaction history, transaction infor-
mation, and a transaction statement; 
‘‘(ii) prior to, or at the time of, each 
transaction in which the dispenser trans-
fers ownership of a product (but not in-
cluding dispensing to a patient or returns) 
shall provide the subsequent owner with 
transaction history, transaction informa-
tion, and a transaction statement for the 
product, except that the requirements of 
this clause shall not apply to sales by a 
dispenser to another dispenser to fulfill a 
specific patient need; and 
‘‘(iii) shall capture transaction infor-
mation (including lot level information, if 
provided), transaction history, and trans-
action statements, as necessary to inves-
tigate a suspect product, and maintain 
such information, history, and statements 
for not less than 6 years after the trans-
action.
such a person without providing the infor-
mation required under subparagraph (A). 
‘‘(D) REQUESTS
FOR
INFORMATION.— 
Upon a request by the Secretary or other ap-
propriate Federal or State official, in the event 
of a recall or for the purpose of investigating a 
suspect or an illegitimate product, a dispenser 
shall, not later than 2 business days after re-
ceiving the request or in another such reason-
able time as determined by the Secretary, based 
on the circumstances of the request, provide the 
applicable transaction information, transaction 
statement, and transaction history which the 
dispenser received from the previous owner, 
which shall not include the lot number of the 
product, the initial transaction date, or the ini-
tial shipment date from the manufacturer un-
less such information was included in the trans-
action information, transaction statement, and 
transaction history provided by the manufac-
turer or wholesale distributor to the dispenser. 
The dispenser may respond to the request by 
providing the applicable information in either 
paper or electronic format. Until the date that 
is 4 years after the date of enactment of the
Drug Supply Chain Security Act, the Secretary 
or other appropriate Federal or State official 
shall grant a dispenser additional time, as nec-
essary, only with respect to a request to provide 
lot level information described in subparagraph 
(F) of section 581(26) that was provided to the 
dispenser in paper format, limit the request 
time period to the 6 months preceding the re-
quest or other relevant date, and, in the event 
of a recall, the Secretary, or other appropriate 
Federal or State official may request informa-
tion only if such recall involves a serious ad-
verse health consequence or death to humans. 
‘‘(2) PRODUCT
IDENTIFIER.—Beginning not 
later than 7 years after the date of enactment of the 
Drug Supply Chain Security Act, a dispenser may 
engage in transactions involving a product only if 
such product is encoded with a product identifier 
(except as provided pursuant to subsection (a)(5)). 
‘‘(3) AUTHORIZED
TRADING
PARTNERS.—Be-
ginning not later than January 1, 2015, the trading 
partners of a dispenser may be only authorized trad-
ing partners. 
‘‘(4) VERIFICATION.—Beginning not later than 
January 1, 2015, a dispenser shall have systems in
place to enable the dispenser to comply with the fol-
lowing requirements: 
‘‘(A) SUSPECT PRODUCT.— 
‘‘(i) IN
GENERAL.—Upon making a 
determination that a product in the posses-
sion or control of the dispenser is a suspect 
product, or upon receiving a request for 
verification from the Secretary that has 
made a determination that a product with-
in the possession or control of a dispenser 
is a suspect product, a dispenser shall— 
‘‘(I) quarantine such product 
within the possession or control of the 
dispenser from product intended for 
distribution until such product is 
cleared or dispositioned; and 
‘‘(II) promptly conduct an inves-
tigation in coordination with trading 
partners, as applicable, to determine 
whether the product is an illegitimate 
product. 
‘‘(ii) INVESTIGATION.—An investiga-
tion conducted under clause (i)(II) shall in-
clude—
‘‘(I) beginning 7 years after the 
date of enactment of the Drug Supply 
Chain Security Act, verifying whether 
the lot number of a suspect product 
corresponds with the lot number for 
such product; 
‘‘(II) beginning 7 years after the 
date of enactment of such Act, 
verifying that the product identifier, 
including the standardized numerical 
identifier, of at least 3 packages or 10 
percent of such suspect product, 
whichever is greater, or all packages, 
if there are fewer than 3, corresponds 
with the product identifier for such 
product; 
‘‘(III) validating any applicable 
transaction history and transaction in-
formation in the possession of the dis-
penser; and 
‘‘(IV) otherwise investigating to 
determine whether the product is an 
illegitimate product. 
‘‘(iii) CLEARED PRODUCT.—If the dis-
penser makes the determination that a sus-
pect product is not an illegitimate product, 
the dispenser shall promptly notify the 
Secretary, if applicable, of such determina-
tion and such product may be further dis-
tributed or dispensed. 
‘‘(iv) RECORDS.—A dispenser shall 
keep records of the investigation of a sus-
pect product for not less than 6 years after 
the conclusion of the investigation. 
‘‘(B) ILLEGITIMATE PRODUCT.— 
‘‘(i) 
IN
GENERAL.—Upon 
deter-
mining, in coordination with the manufac-
turer, that a product in the possession or 
control of a dispenser is an illegitimate 
product, the dispenser shall— 
‘‘(I) disposition the illegitimate 
product within the possession or con-
trol of the dispenser; 
‘‘(II) take reasonable and appro-
priate steps to assist a trading part-
ner to disposition an illegitimate prod-
uct not in the possession or control of 
the dispenser; and 
‘‘(III) retain a sample of the 
product for further physical examina-
tion or laboratory analysis of the 
product by the manufacturer or Sec-
retary (or other appropriate Federal 
or State official) upon request by the 
manufacturer or Secretary (or other 
appropriate Federal or State official), 
as necessary and appropriate. 
‘‘(ii) 
MAKING
A
NOTIFICATION.— 
Upon determining that a product in the 
possession or control of the dispenser is an 
illegitimate product, the dispenser shall no-
tify the Secretary and all immediate trad-
ing partners that the dispenser has reason 
to believe may have received such illegit-
imate product of such determination not 
later than 24 hours after making such de-
termination. 
‘‘(iii) RESPONDING
TO
A
NOTIFICA-
TION.—Upon the receipt of a notification 
from the Secretary or a trading partner 
that a determination has been made that a 
product is an illegitimate product, a dis-
penser shall identify all illegitimate product 
subject to such notification that is in the 
possession or control of the dispenser, in-
cluding any product that is subsequently 
received, and shall perform the activities 
described in subparagraph (A). 
‘‘(iv) 
TERMINATING
A
NOTIFICA-
TION.—Upon making a determination, in 
consultation with the Secretary, that a no-
tification is no longer necessary, a dis-
penser shall promptly notify immediate 
trading partners that the dispenser notified 
pursuant to clause (ii) that such notifica-
tion has been terminated. 
‘‘(v) RECORDS.—A dispenser shall 
keep records of the disposition of an illegit-
imate product for not less than 6 years 
after the conclusion of the disposition. 
‘‘(C) ELECTRONIC
DATABASE.—A dis-
penser may satisfy the requirements of this 
paragraph by developing a secure electronic 
database or utilizing a secure electronic data-
base developed or operated by another entity. 
‘‘(5) EXCEPTION.—Notwithstanding any other 
provision of law, the requirements under paragraphs 
(1) and (4) shall not apply to licensed health care 
practitioners authorized to prescribe or administer 
medication under State law or other licensed individ-
uals under the supervision or direction of such prac-
titioners who dispense or administer product in the 
usual course of professional practice. 
‘‘(e) REPACKAGER REQUIREMENTS.— 
‘‘(1) PRODUCT TRACING.— 
‘‘(A) IN
GENERAL.—Beginning not later 
than January 1, 2015, a repackager described 
in section 581(16)(A) shall— 
‘‘(i) not accept ownership of a product 
unless the previous owner, prior to, or at 
the time of, the transaction, provides 
transaction history, transaction informa-
tion, and a transaction statement for the 
product; 
‘‘(ii) prior to, or at the time of, each 
transaction in which the repackager trans-
fers ownership of a product, provide the 
subsequent owner with transaction history, 
transaction information, and a transaction 
statement for the product; and 
‘‘(iii) capture the transaction informa-
tion (including lot level information), 
transaction history, and transaction state-
ment for each transaction described in 
clauses (i) and (ii) and maintain such in-
formation, history, and statement for not 
less than 6 years after the transaction. 
‘‘(B) RETURNS.— 
‘‘(i) NONSALEABLE PRODUCT.—A re-
packager described in section 581(16)(A) 
may return a nonsaleable product to the 
manufacturer or repackager, or to the 
wholesale distributor from whom such 
product was purchased, or to a person act-
ing on behalf of such a person, including 
a returns processor, without providing the 
information required under subparagraph 
(A)(ii). 
‘‘(ii) SALEABLE
OR
NONSALEABLE 
PRODUCT.—A repackager described in sec-
tion 581(16)(B) may return a saleable or 
nonsaleable product to the manufacturer, 
repackager, or to the wholesale distributor 
from whom such product was received 
without providing the information required 
under subparagraph (A)(ii) on behalf of 
the hospital or other health care entity 
that took ownership of such product pursu-
ant to the terms and conditions of any
agreement between such repackager and 
the entity that owns the product. 
‘‘(C) REQUESTS
FOR
INFORMATION.— 
Upon a request by the Secretary or other ap-
propriate Federal or State official, in the event 
of a recall or for the purpose of investigating a 
suspect product or an illegitimate product, a re-
packager described in section 581(16)(A) shall, 
not later than 1 business day, and not to exceed 
48 hours, after receiving the request or in other 
such reasonable time as determined by the Sec-
retary, provide the applicable transaction infor-
mation, transaction history, and transaction 
statement for the product. 
‘‘(2) PRODUCT IDENTIFIER.— 
‘‘(A) IN
GENERAL.—Beginning not later 
than 5 years after the date of enactment of the 
Drug Supply Chain Security Act, a repackager 
described in section 581(16)(A)— 
‘‘(i) shall affix or imprint a product 
identifier to each package and homogenous 
case of product intended to be introduced 
in a transaction in commerce; 
‘‘(ii) shall maintain the product iden-
tifier information for such product for not
less than 6 years after the date of the 
transaction; 
‘‘(iii) may engage in transactions in-
volving a product only if such product is 
encoded with a product identifier (except 
as provided pursuant to subsection (a)(5)); 
and 
‘‘(iv) shall maintain records for not 
less than 6 years to allow the repackager 
to associate the product identifier the re-
packager affixes or imprints with the prod-
uct identifier assigned by the original man-
ufacturer of the product. 
‘‘(B) EXCEPTION.—A package that is re-
quired to have a standardized numerical identi-
fier is not required to have a unique device 
identifier. 
‘‘(3) AUTHORIZED
TRADING
PARTNERS.—Be-
ginning January 1, 2015, the trading partners of a 
repackager described in section 581(16) may be only 
authorized trading partners. 
‘‘(4) VERIFICATION.—Beginning not later than 
January 1, 2015, a repackager described in section 
581(16)(A) shall have systems in place to enable the
repackager to comply with the following require-
ments: 
‘‘(A) SUSPECT PRODUCT.— 
‘‘(i) IN
GENERAL.—Upon making a 
determination that a product in the posses-
sion or control of the repackager is a sus-
pect product, or upon receiving a request 
for verification from the Secretary that has 
made a determination that a product with-
in the possession or control of a repack-
ager is a suspect product, a repackager 
shall— 
‘‘(I) quarantine such product 
within the possession or control of the 
repackager from product intended for 
distribution until such product is 
cleared or dispositioned; and 
‘‘(II) promptly conduct an inves-
tigation in coordination with trading 
partners, as applicable, to determine 
whether the product is an illegitimate 
product, which shall include validating 
any applicable transaction history and 
transaction information in the posses-
sion of the repackager and otherwise
investigating to determine whether the 
product is an illegitimate product, 
and, beginning 5 years after the date 
of enactment of the Drug Supply 
Chain Security Act (except as pro-
vided pursuant to subsection (a)(5)), 
verifying the product at the package 
level, including the standardized nu-
merical identifier. 
‘‘(ii) CLEARED PRODUCT.—If the re-
packager makes the determination that a 
suspect product is not an illegitimate prod-
uct, the repackager shall promptly notify 
the Secretary, if applicable, of such deter-
mination and such product may be further 
distributed. 
‘‘(iii) RECORDS.—A repackager shall 
keep records of the investigation of a sus-
pect product for not less than 6 years after 
the conclusion of the investigation. 
‘‘(B) ILLEGITIMATE PRODUCT.— 
‘‘(i) 
IN
GENERAL.—Upon 
deter-
mining, in coordination with the manufac-
turer, that a product in the possession or 
control of a repackager is an illegitimate
product, the repackager shall, in a manner 
that is consistent with the systems and 
processes of such repackager— 
‘‘(I) quarantine such product 
within the possession or control of the 
repackager from product intended for 
distribution until such product is 
dispositioned; 
‘‘(II) disposition the illegitimate 
product within the possession or con-
trol of the repackager; 
‘‘(III) take reasonable and appro-
priate steps to assist a trading part-
ner to disposition an illegitimate prod-
uct not in the possession or control of 
the repackager; and 
‘‘(IV) retain a sample of the 
product for further physical examina-
tion or laboratory analysis of the 
product by the manufacturer or Sec-
retary (or other appropriate Federal 
or State official) upon request by the 
manufacturer or Secretary (or other 
appropriate Federal or State official), 
as necessary and appropriate.
‘‘(ii) 
MAKING
A
NOTIFICATION.— 
Upon determining that a product in the 
possession or control of the repackager is 
an illegitimate product, the repackager 
shall notify the Secretary and all imme-
diate trading partners that the repackager 
has reason to believe may have received the 
illegitimate product of such determination 
not later than 24 hours after making such 
determination. 
‘‘(iii) RESPONDING
TO
A
NOTIFICA-
TION.—Upon the receipt of a notification 
from the Secretary or a trading partner, a 
repackager shall identify all illegitimate 
product subject to such notification that is 
in the possession or control of the repack-
ager, including any product that is subse-
quently received, and shall perform the ac-
tivities described in subparagraph (A). 
‘‘(iv) 
TERMINATING
A
NOTIFICA-
TION.—Upon making a determination, in 
consultation with the Secretary, that a no-
tification is no longer necessary, a repack-
ager shall promptly notify immediate trad-
ing partners that the repackager notified
pursuant to clause (ii) that such notifica-
tion has been terminated. 
‘‘(v) RECORDS.—A repackager shall 
keep records of the disposition of an illegit-
imate product for not less than 6 years 
after the conclusion of the disposition. 
‘‘(C) REQUESTS FOR VERIFICATION.—Be-
ginning 5 years after the date of enactment of 
the Drug Supply Chain Security Act, upon re-
ceiving a request for verification from an au-
thorized manufacturer, wholesale distributor, or 
dispenser that is in possession or control of a 
product they believe to be repackaged by such 
repackager, a repackager shall, not later than 
24 hours after receiving the verification request 
or in other such reasonable time as determined 
by the Secretary, based on the circumstances of 
the request, notify the person making the re-
quest whether the product identifier, including 
the standardized numerical identifier, that is 
the subject of the request corresponds to the 
product identifier affixed or imprinted by the 
repackager. If a repackager responding to a 
verification request identifies a product identi-
fier that does not correspond to that affixed or
100 
imprinted by the repackager, the repackager 
shall treat such product as suspect product and 
conduct an investigation as described in sub-
paragraph (A). If the repackager has reason to 
believe the product is an illegitimate product, 
the repackager shall advise the person making 
the request of such belief at the time such re-
packager responds to the verification request. 
‘‘(D) ELECTRONIC DATABASE.—A repack-
ager may satisfy the requirements of paragraph 
(4) by developing a secure electronic database 
or utilizing a secure electronic database devel-
oped or operated by another entity. The owner 
of such database shall establish the require-
ments and processes to respond to requests and 
may provide for data access to other members 
of the pharmaceutical distribution supply chain, 
as appropriate. The development and operation 
of such a database shall not relieve a repack-
ager of the requirement under subparagraph 
(C) to respond to a verification request sub-
mitted by means other than a secure electronic 
database. 
‘‘(E) VERIFICATION
OF
SALEABLE
RE-
TURNED
PRODUCT.—Beginning 5 years after
101 
the date of enactment of the Drug Supply 
Chain Security Act, upon receipt of a returned 
product that the repackager intends to further 
distribute, before further distributing such 
product, the repackager shall verify the product 
identifier for each sealed homogeneous case of 
such product or, if such product is not in a 
sealed homogeneous case, verify the product 
identifier on each package. 
‘‘(f) DROP SHIPMENTS.— 
‘‘(1) IN
GENERAL.—A wholesale distributor 
that does not physically handle or store product 
shall be exempt from the provisions of this section, 
except the notification requirements under clauses 
(ii), (iii), and (iv) of subsection (c)(4)(B), provided 
that the manufacturer, repackager, or other whole-
sale distributor that distributes the product to the 
dispenser by means of a drop shipment for such 
wholesale distributor includes on the transaction in-
formation and transaction history to the dispenser 
the contact information of such wholesale distributor 
and provides the transaction information, trans-
action history, and transaction statement directly to 
the dispenser.
102 
‘‘(2) CLARIFICATION.—For purposes of this 
subsection, providing administrative services, includ-
ing processing of orders and payments, shall not by 
itself, be construed as being involved in the han-
dling, distribution, or storage of a product.’’. 
SEC. 203. ENHANCED DRUG DISTRIBUTION SECURITY. 
Section 582, as added by section 202, is amended by 
adding at the end the following: 
‘‘(g) ENHANCED DRUG DISTRIBUTION SECURITY.— 
‘‘(1) IN
GENERAL.—On the date that is 10 
years after the date of enactment of the Drug Sup-
ply Chain Security Act, the following interoperable, 
electronic tracing of product at the package level re-
quirements shall go into effect: 
‘‘(A) The transaction information and the 
transaction statements as required under this 
section shall be exchanged in a secure, inter-
operable, electronic manner in accordance with 
the standards established under the guidance 
issued pursuant to paragraphs (3) and (4) of 
subsection (h), including any revision of such 
guidance issued in accordance with paragraph 
(5) of such subsection. 
‘‘(B) The transaction information required 
under this section shall include the product
103 
identifier at the package level for each package 
included in the transaction. 
‘‘(C) Systems and processes for verification 
of product at the package level, including the 
standardized numerical identifier, shall be re-
quired in accordance with the standards estab-
lished under the guidance issued pursuant to 
subsection (a)(2) and the guidances issued pur-
suant to paragraphs (2), (3), and (4) of sub-
section (h), including any revision of such guid-
ances issued in accordance with paragraph (5) 
of such subsection, which may include the use 
of aggregation and inference as necessary. 
‘‘(D) The systems and processes necessary 
to promptly respond with the transaction infor-
mation and transaction statement for a product 
upon a request by the Secretary (or other ap-
propriate Federal or State official) in the event 
of a recall or for the purposes of investigating 
a suspect product or an illegitimate product 
shall be required. 
‘‘(E) The systems and processes necessary 
to promptly facilitate gathering the information 
necessary to produce the transaction informa-
104 
tion for each transaction going back to the 
manufacturer, as applicable, shall be required— 
‘‘(i) in the event of a request by the 
Secretary (or other appropriate Federal or 
State official), on account of a recall or for 
the purposes of investigating a suspect 
product or an illegitimate product; or 
‘‘(ii) in the event of a request by an 
authorized trading partner, in a secure 
manner that ensures the protection of con-
fidential commercial information and trade 
secrets, for purposes of investigating a sus-
pect product or assisting the Secretary (or 
other appropriate Federal or State official) 
with a request described in clause (i). 
‘‘(F) Each person accepting a saleable re-
turn shall have systems and processes in place 
to allow acceptance of such product and may 
accept saleable returns only if such person can 
associate the saleable return product with the 
transaction information and transaction state-
ment associated with that product. 
‘‘(2) COMPLIANCE.— 
‘‘(A) INFORMATION MAINTENANCE AGREE-
MENT.—A dispenser may enter into a written
105 
agreement with a third party, including an au-
thorized wholesale distributor, under which the 
third party shall confidentially maintain any in-
formation and statements required to be main-
tained under this section. If a dispenser enters 
into such an agreement, the dispenser shall 
maintain a copy of the written agreement and 
shall not be relieved of the obligations of the 
dispenser under this subsection. 
‘‘(B) ALTERNATIVE METHODS.—The Sec-
retary, taking into consideration the assessment 
conducted under paragraph (3), shall provide 
for alternative methods of compliance with any 
of the requirements set forth in paragraph (1), 
including— 
‘‘(i) establishing timelines for compli-
ance by small businesses (including small 
business dispensers with 25 or fewer full- 
time employees) with such requirements, in 
order to ensure that such requirements do 
not impose undue economic hardship for 
small businesses, including small business 
dispensers for whom the criteria set forth 
in the assessment under paragraph (3) is 
not met, if the Secretary determines that
106 
such requirements under paragraph (1) 
would result in undue economic hardship; 
and 
‘‘(ii) establishing a process by which a 
dispenser may request a waiver from any 
of the requirements set forth in paragraph 
(1) if the Secretary determines that such 
requirements would result in an undue eco-
nomic hardship, which shall include a proc-
ess for the biennial review and renewal of 
any such waiver. 
‘‘(3) ASSESSMENT.— 
‘‘(A) IN
GENERAL.—Not later than the 
date that is 18 months after the Secretary 
issues the final guidance required under sub-
section (h), the Secretary shall enter into a con-
tract with a private, independent consulting 
firm with expertise to conduct a technology and 
software assessment that looks at the feasibility 
of dispensers with 25 or fewer full-time employ-
ees conducting interoperable, electronic tracing 
of products at the package level. Such assess-
ment shall be completed not later than 81⁄2 
years after the date of enactment of the Drug 
Supply Chain Security Act.
107 
‘‘(B) CONDITION.—As a condition of the 
award of the contract under subparagraph (A), 
the private, independent consulting firm shall 
agree to consult with dispensers with 25 or 
fewer full-time employees when conducting the 
assessment under such subparagraph. 
‘‘(C) CONTENT.—The assessment under 
subparagraph (A) shall assess whether— 
‘‘(i) the necessary software and hard-
ware is readily accessible to such dis-
pensers; 
‘‘(ii) the necessary software and hard-
ware is prohibitively expensive to obtain, 
install, and maintain for such dispensers; 
and 
‘‘(iii) the necessary hardware and 
software can be integrated into business 
practices, such as interoperability with 
wholesale distributors, for such dispensers. 
‘‘(D) 
PUBLICATION.—The 
Secretary 
shall— 
‘‘(i) publish the statement of work for 
the assessment under subparagraph (A) 
for public comment prior to beginning the 
assessment;
108 
‘‘(ii) publish the final assessment for 
public comment not later than 30 calendar 
days after receiving such assessment; and 
‘‘(iii) hold a public meeting not later 
than 180 calendar days after receiving the 
final assessment at which public stake-
holders may present their views on the as-
sessment. 
‘‘(4) 
PROCEDURE.—Notwithstanding 
section 
553 of title 5, United States Code, the Secretary, in 
promulgating any regulation pursuant to this sec-
tion, shall— 
‘‘(A) provide appropriate flexibility by— 
‘‘(i) not requiring the adoption of spe-
cific business systems for the maintenance 
and transmission of data; 
‘‘(ii) prescribing alternative methods 
of compliance for any of the requirements 
set forth in paragraph (1) or set forth in 
regulations implementing such require-
ments, including— 
‘‘(I) timelines for small busi-
nesses to comply with the require-
ments set forth in the regulations in 
order to ensure that such require-
109 
ments do not impose undue economic 
hardship for small businesses (includ-
ing small business dispensers for 
whom the criteria set forth in the as-
sessment under paragraph (3) is not 
met), if the Secretary determines that 
such requirements would result in 
undue economic hardship; and 
‘‘(II) the establishment of a proc-
ess by which a dispenser may request 
a waiver from any of the requirements 
set forth in such regulations if the 
Secretary determines that such re-
quirements would result in an undue 
economic hardship; and 
‘‘(iii) taking into consideration— 
‘‘(I) the results of pilot projects, 
including pilot projects pursuant to 
this section and private sector pilot 
projects, including those involving the 
use of aggregation and inference; 
‘‘(II) the public meetings held 
and 
related 
guidance 
documents 
issued under this section;
110 
‘‘(III) the public health benefits 
of any additional regulations in com-
parison to the cost of compliance with 
such requirements, including on enti-
ties of varying sizes and capabilities; 
‘‘(IV) the diversity of the phar-
maceutical distribution supply chain 
by providing appropriate flexibility for 
each sector, including both large and 
small businesses; and 
‘‘(V) the assessment pursuant to 
paragraph (3) with respect to small 
business dispensers, including related 
public comment and the public meet-
ing, and requirements under this sec-
tion; 
‘‘(B) issue a notice of proposed rulemaking 
that includes a copy of the proposed regulation; 
‘‘(C) provide a period of not less than 60 
days for comments on the proposed regulation; 
and 
‘‘(D) publish in the Federal Register the 
final regulation not less than 2 years prior to 
the effective date of the regulation. 
‘‘(h) GUIDANCE DOCUMENTS.—
111 
‘‘(1) IN GENERAL.—For the purposes of facili-
tating the successful and efficient adoption of se-
cure, interoperable product tracing at the package 
level in order to enhance drug distribution security 
and further protect the public health, the Secretary 
shall issue the guidance documents as provided for 
in this subsection. 
‘‘(2) SUSPECT AND ILLEGITIMATE PRODUCT.— 
‘‘(A) IN
GENERAL.—Not later than 180 
days after the date of enactment of the Drug 
Supply Chain Security Act, the Secretary shall 
issue a guidance document to aid trading part-
ners in the identification of a suspect product 
and notification termination. Such guidance 
document shall— 
‘‘(i) identify specific scenarios that 
could significantly increase the risk of a 
suspect product entering the pharma-
ceutical distribution supply chain; 
‘‘(ii) provide recommendation on how 
trading partners may identify such product 
and make a determination on whether the 
product is a suspect product as soon as 
practicable; and
112 
‘‘(iii) set forth the process by which 
manufacturers, repackagers, wholesale dis-
tributors, and dispensers shall terminate 
notifications in consultation with the Sec-
retary regarding illegitimate product pur-
suant to subsections (b)(4)(B), (c)(4)(B), 
(d)(4)(B), and (e)(4)(B). 
‘‘(B) REVISED
GUIDANCE.—If the Sec-
retary revises the guidance issued under sub-
paragraph (A), the Secretary shall follow the 
procedure set forth in paragraph (5). 
‘‘(3) UNIT LEVEL TRACING.— 
‘‘(A) IN GENERAL.—In order to enhance 
drug distribution security at the package level, 
not later than 18 months after conducting a 
public meeting on the system attributes nec-
essary to enable secure tracing of product at 
the package level, including allowing for the use 
of verification, inference, and aggregation, as 
necessary, the Secretary shall issue a final guid-
ance document that outlines and makes rec-
ommendations with respect to the system at-
tributes necessary to enable secure tracing at 
the package level as required under the require-
113 
ments established under subsection (g). Such 
guidance document shall— 
‘‘(i) define the circumstances under 
which the sectors within the pharma-
ceutical distribution supply chain may, in 
the most efficient manner practicable, infer 
the contents of a case, pallet, tote, or other 
aggregate of individual packages or con-
tainers of product, from a product identi-
fier associated with the case, pallet, tote, 
or other aggregate, without opening each 
case, pallet, tote, or other aggregate or 
otherwise individually scanning each pack-
age; 
‘‘(ii) identify methods and processes 
to enhance secure tracing of product at the 
package level, such as secure processes to 
facilitate the use of inference, enhanced 
verification activities, the use of aggrega-
tion and inference, processes that utilize 
the product identifiers to enhance tracing 
of product at the package level, including 
the standardized numerical identifier, or 
package security features; and
114 
‘‘(iii) ensure the protection of con-
fidential commercial information and trade 
secrets. 
‘‘(B) PROCEDURE.—In issuing the guid-
ance under subparagraph (A), and in revising 
such guidance, if applicable, the Secretary shall 
follow the procedure set forth in paragraph (5). 
‘‘(4) STANDARDS
FOR
INTEROPERABLE
DATA 
EXCHANGE.— 
‘‘(A) IN GENERAL.—In order to enhance 
secure tracing of a product at the package level, 
the Secretary, not later than 18 months after 
conducting a public meeting on the interoper-
able standards necessary to enhance the secu-
rity of the pharmaceutical distribution supply 
chain, shall update the guidance issued pursu-
ant to subsection (a)(2), as necessary and ap-
propriate, and finalize such guidance document 
so that the guidance document— 
‘‘(i) 
identifies 
and 
makes 
rec-
ommendations with respect to the stand-
ards necessary for adoption in order to 
support the secure, interoperable electronic 
data exchange among the pharmaceutical 
distribution supply chain that comply with
115 
a form and format developed by a widely 
recognized international standards develop-
ment organization; 
‘‘(ii) takes into consideration stand-
ards established pursuant to subsection 
(a)(2) and section 505D; 
‘‘(iii) facilitates the creation of a uni-
form process or methodology for product 
tracing; and 
‘‘(iv) ensures the protection of con-
fidential commercial information and trade 
secrets. 
‘‘(B) PROCEDURE.—In issuing the guid-
ance under subparagraph (A), and in revising 
such guidance, if applicable, the Secretary shall 
follow the procedure set forth in paragraph (5). 
‘‘(5) PROCEDURE.—In issuing or revising any 
guidance issued pursuant to this subsection or sub-
section (g), except the initial guidance issued under 
paragraph (2)(A), the Secretary shall— 
‘‘(A) publish a notice in the Federal Reg-
ister for a period not less than 30 days an-
nouncing that the draft or revised draft guid-
ance is available;
116 
‘‘(B) post the draft guidance document on 
the Internet Web site of the Food and Drug 
Administration and make such draft guidance 
document available in hard copy; 
‘‘(C) provide an opportunity for comment 
and review and take into consideration any 
comments received; 
‘‘(D) revise the draft guidance, as appro-
priate; 
‘‘(E) publish a notice in the Federal Reg-
ister for a period not less than 30 days an-
nouncing that the final guidance or final revised 
guidance is available; 
‘‘(F) post the final guidance document on 
the Internet Web site of the Food and Drug 
Administration and make such final guidance 
document available in hard copy; and 
‘‘(G) provide for an effective date of not 
earlier than 1 year after such guidance becomes 
final. 
‘‘(i) PUBLIC MEETINGS.— 
‘‘(1) IN GENERAL.—The Secretary shall hold 
not less than 5 public meetings to enhance the safe-
ty and security of the pharmaceutical distribution 
supply chain and provide for comment. The Sec-
117 
retary may hold the first such public meeting not 
earlier than 1 year after the date of enactment of 
the Drug Supply Chain Security Act. In carrying 
out the public meetings described in this paragraph, 
the Secretary shall— 
‘‘(A) prioritize topics necessary to inform 
the issuance of the guidance described in para-
graphs (3) and (4) of subsection (h); and 
‘‘(B) take all measures reasonable and 
practicable to ensure the protection of confiden-
tial commercial information and trade secrets. 
‘‘(2) CONTENT.—Each of the following topics 
shall be addressed in at least one of the public meet-
ings described in paragraph (1): 
‘‘(A) An assessment of the steps taken 
under subsections (b) through (e) to build ca-
pacity for a unit-level system, including the im-
pact of the requirements of such subsections 
on— 
‘‘(i) the ability of the health care sys-
tem collectively to maintain patient access 
to medicines; 
‘‘(ii) the scalability of such require-
ments, including as it relates to product 
lines; and
118 
‘‘(iii) the capability of different sec-
tors and subsectors, including both large 
and small businesses, to affix and utilize 
the product identifier. 
‘‘(B) The system attributes necessary to 
support the requirements set forth under sub-
section (g), including the standards necessary 
for adoption in order to support the secure, 
interoperable electronic data exchange among 
sectors within the pharmaceutical distribution 
supply chain. 
‘‘(C) Best practices in each of the different 
sectors within the pharmaceutical distribution 
supply chain to implement the requirements of 
this section. 
‘‘(D) The costs and benefits of the imple-
mentation of this section, including the impact 
on each pharmaceutical distribution supply 
chain sector and on public health. 
‘‘(E) Whether electronic tracing require-
ments, including tracing of product at the pack-
age level, are feasible, cost effective, and needed 
to protect the public health. 
‘‘(F) The systems and processes needed to 
utilize the product identifiers to enhance tracing
119 
of product at the package level, including allow-
ing for verification, aggregation, and inference, 
as necessary. 
‘‘(G) The technical capabilities and legal 
authorities, if any, needed to establish an inter-
operable, electronic system that provides for 
tracing of product at the package level. 
‘‘(H) The impact that such additional re-
quirements would have on patient safety, the 
drug supply, cost and regulatory burden, and 
timely patient access to prescription drugs. 
‘‘(I) Other topics, as determined appro-
priate by the Secretary. 
‘‘(j) PILOT PROJECTS.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish 1 or more pilot projects, in coordination with 
authorized manufacturers, repackagers, wholesale 
distributors, and dispensers, to explore and evaluate 
methods to enhance the safety and security of the 
pharmaceutical distribution supply chain. Such 
projects shall build upon efforts, in existence as of 
the date of enactment of the Drug Supply Chain Se-
curity Act, to enhance the safety and security of the 
pharmaceutical distribution supply chain, take into 
consideration any pilot projects conducted prior to
120 
such date of enactment, including any pilot projects 
that use aggregation and inference, and inform the 
draft and final guidance under paragraphs (3) and 
(4) of subsection (h). 
‘‘(2) CONTENT.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
ensure that the pilot projects under paragraph 
(1) reflect the diversity of the pharmaceutical 
distribution supply chain and that the pilot 
projects, when taken as a whole, include partici-
pants representative of every sector, including 
both large and small businesses. 
‘‘(B) 
PROJECT
DESIGN.—The 
pilot 
projects under paragraph (1) shall be designed 
to— 
‘‘(i) utilize the product identifier for 
tracing of a product, which may include 
verification of the product identifier of a 
product, including the use of aggregation 
and inference; 
‘‘(ii) improve the technical capabilities 
of each sector and subsector to comply 
with systems and processes needed to uti-
lize the product identifiers to enhance trac-
ing of a product;
121 
‘‘(iii) identify system attributes that 
are necessary to implement the require-
ments established under this section; and 
‘‘(iv) complete other activities as de-
termined by the Secretary. 
‘‘(k) SUNSET.—The following requirements shall 
have no force or effect beginning on the date that is 10 
years after the date of enactment of the Drug Supply 
Chain Security Act: 
‘‘(1) The provision and receipt of transaction 
history under this section. 
‘‘(2) The requirements set forth for returns 
under 
subsections 
(b)(4)(E), 
(c)(1)(B)(i), 
(d)(1)(C)(i), and (e)(4)(E). 
‘‘(3) The requirements set forth under subpara-
graphs (A)(v)(II) and (D) of subsection (c)(1), as 
applied to lot level information only. 
‘‘(l) RULE OF CONSTRUCTION.—The requirements 
set forth in subsections (g)(4), (i), and (j) shall not be 
construed as a condition, prohibition, or precedent for pre-
cluding or delaying the provisions becoming effective pur-
suant to subsection (g). 
‘‘(m) REQUESTS FOR INFORMATION.—On the date 
that is 10 years after the date of enactment of the Drug 
Supply Chain Security Act, the timeline for responses to
122 
requests for information from the Secretary, or other ap-
propriate Federal or State official, as applicable, under 
subsections (b)(1)(B), (c)(1)(C), and (e)(1)(C) shall be 
not later than 24 hours after receiving the request from 
the Secretary or other appropriate Federal or State offi-
cial, as applicable, or in such other reasonable time as de-
termined by the Secretary based on the circumstances of 
the request.’’. 
SEC. 204. NATIONAL STANDARDS FOR PRESCRIPTION DRUG 
WHOLESALE DISTRIBUTORS. 
(a) AMENDMENTS.— 
(1) REQUIREMENT.—Section 503(e) (21 U.S.C. 
353(e)) is amended by striking paragraphs (1), (2), 
and (3) and inserting the following: 
‘‘(1) REQUIREMENT.—Subject to section 583: 
‘‘(A) IN
GENERAL.—No person may en-
gage in wholesale distribution of a drug subject 
to subsection (b)(1) in any State unless such 
person— 
‘‘(i)(I) is licensed by the State from 
which the drug is distributed; or 
‘‘(II) if the State from which the drug 
is distributed has not established a licen-
sure requirement, is licensed by the Sec-
retary; and
123 
‘‘(ii) if the drug is distributed inter-
state, is licensed by the State into which 
the drug is distributed if the State into 
which the drug is distributed requires the 
licensure of a person that distributes drugs 
into the State. 
‘‘(B) STANDARDS.—Each Federal and 
State license described in subparagraph (A) 
shall meet the standards, terms, and conditions 
established by the Secretary under section 583. 
‘‘(2) REPORTING AND DATABASE.— 
‘‘(A) REPORTING.—Beginning January 1, 
2015, any person who owns or operates an es-
tablishment that engages in wholesale distribu-
tion shall— 
‘‘(i) report to the Secretary, on an an-
nual basis pursuant to a schedule deter-
mined by the Secretary— 
‘‘(I) each State by which the per-
son is licensed and the appropriate 
identification number of each such li-
cense; and 
‘‘(II) the name, address, and con-
tact information of each facility at 
which, and all trade names under
124 
which, the person conducts business; 
and 
‘‘(ii) report to the Secretary within a 
reasonable period of time and in a reason-
able manner, as determined by the Sec-
retary, any significant disciplinary actions, 
such as the revocation or suspension of a 
wholesale distributor license, taken by a 
State or the Federal Government during 
the reporting period against the wholesale 
distributor. 
‘‘(B) DATABASE.—Not later than January 
1, 2015, the Secretary shall establish a data-
base of authorized wholesale distributors. Such 
database shall— 
‘‘(i) identify each authorized wholesale 
distributor by name, contact information, 
and each State where such wholesale dis-
tributor is appropriately licensed to engage 
in wholesale distribution; 
‘‘(ii) be available to the public on the 
Internet Web site of the Food and Drug 
Administration; and 
‘‘(iii) be regularly updated on a sched-
ule determined by the Secretary.
125 
‘‘(C) COORDINATION.—The Secretary shall 
establish a format and procedure for appro-
priate State officials to access the information 
provided pursuant to subparagraph (A) in a 
prompt and secure manner. 
‘‘(D) CONFIDENTIALITY.—Nothing in this 
paragraph shall be construed as authorizing the 
Secretary to disclose any information that is a 
trade secret or confidential information subject 
to section 552(b)(4) of title 5, United States 
Code, or section 1905 of title 18, United States 
Code. 
‘‘(3) COSTS.— 
‘‘(A) AUTHORIZED FEES OF SECRETARY.— 
If a State does not establish a licensing pro-
gram for persons engaged in the wholesale dis-
tribution of a drug subject to subsection (b), 
the Secretary shall license a person engaged in 
wholesale distribution located in such State and 
may collect a reasonable fee in such amount 
necessary to reimburse the Secretary for costs 
associated with establishing and administering 
the licensure program and conducting periodic 
inspections under this section. The Secretary 
shall adjust fee rates as needed on an annual
126 
basis to generate only the amount of revenue 
needed to perform this service. Fees authorized 
under this paragraph shall be collected and 
available for obligation only to the extent and in 
the amount provided in advance in appropria-
tions Acts. Such fees are authorized to remain 
available until expended. Such sums as may be 
necessary may be transferred from the Food 
and Drug Administration salaries and expenses 
appropriation account without fiscal year limi-
tation to such appropriation account for sala-
ries and expenses with such fiscal year limita-
tion. 
‘‘(B) STATE LICENSING FEES.—Nothing in 
this Act shall prohibit States from collecting 
fees from wholesale distributors in connection 
with State licensing of such distributors.’’. 
(2) 
WHOLESALE
DISTRIBUTION.—Section 
503(e) (21 U.S.C. 353(e)), as amended by para-
graph (1), is further amended by adding at the end 
the following: 
‘‘(4) For the purposes of this subsection and 
subsection (d), the term ‘wholesale distribution’ 
means the distribution of a drug subject to sub-
section (b) to a person other than a consumer or pa-
127 
tient, or receipt of a drug subject to subsection (b) 
by a person other than the consumer or patient, but 
does not include— 
‘‘(A) intracompany distribution of any 
drug between members of an affiliate or within 
a manufacturer; 
‘‘(B) the distribution of a drug, or an offer 
to distribute a drug among hospitals or other 
health care entities which are under common 
control; 
‘‘(C) the distribution of a drug or an offer 
to distribute a drug for emergency medical rea-
sons, including a public health emergency dec-
laration pursuant to section 319 of the Public 
Health Service Act, except that, for purposes of 
this paragraph, a drug shortage not caused by 
a public health emergency shall not constitute 
an emergency medical reason; 
‘‘(D) the dispensing of a drug pursuant to 
a prescription executed in accordance with sub-
section (b)(1); 
‘‘(E) the distribution of minimal quantities 
of drug by a licensed retail pharmacy to a li-
censed practitioner for office use;
128 
‘‘(F) the distribution of a drug or an offer 
to distribute a drug by a charitable organization 
to a nonprofit affiliate of the organization to 
the extent otherwise permitted by law; 
‘‘(G) the purchase or other acquisition by 
a dispenser, hospital, or other health care entity 
of a drug for use by such dispenser, hospital, or 
other health care entity; 
‘‘(H) the distribution of a drug by the 
manufacturer of such drug; 
‘‘(I) the receipt or transfer of a drug by an 
authorized third-party logistics provider pro-
vided that such third-party logistics provider 
does not take ownership of the drug; 
‘‘(J) a common carrier that transports a 
drug, provided that the common carrier does 
not take ownership of the drug; 
‘‘(K) the distribution of a drug, or an offer 
to distribute a drug by an authorized repack-
ager that has taken ownership or possession of 
the drug and repacks it in accordance with sec-
tion 582(e); 
‘‘(L) salable drug returns when conducted 
by a dispenser;
129 
‘‘(M) the distribution of a collection of fin-
ished medical devices, which may include a 
product or biological product, assembled in kit 
form strictly for the convenience of the pur-
chaser or user (referred to in this subparagraph 
as a ‘medical convenience kit’) if— 
‘‘(i) the medical convenience kit is as-
sembled in an establishment that is reg-
istered with the Food and Drug Adminis-
tration as a device manufacturer in accord-
ance with section 510(b)(2); 
‘‘(ii) the medical convenience kit does 
not contain a controlled substance that ap-
pears in a schedule contained in the Com-
prehensive Drug Abuse Prevention and 
Control Act of 1970; 
‘‘(iii) in the case of a medical conven-
ience kit that includes a product, the per-
son that manufacturers the kit— 
‘‘(I) purchased such product di-
rectly from the pharmaceutical manu-
facturer or from a wholesale dis-
tributor that purchased the product 
directly from the pharmaceutical man-
ufacturer; and
130 
‘‘(II) does not alter the primary 
container or label of the product as 
purchased from the manufacturer or 
wholesale distributor; and 
‘‘(iv) in the case of a medical conven-
ience kit that includes a product, the prod-
uct is— 
‘‘(I) an intravenous solution in-
tended for the replenishment of fluids 
and electrolytes; 
‘‘(II) a product intended to main-
tain the equilibrium of water and min-
erals in the body; 
‘‘(III) a product intended for irri-
gation or reconstitution; 
‘‘(IV) an anesthetic; 
‘‘(V) an anticoagulant; 
‘‘(VI) a vasopressor; or 
‘‘(VII) a sympathomimetic; 
‘‘(N) the distribution of an intravenous 
drug that, by its formulation, is intended for 
the replenishment of fluids and electrolytes 
(such as sodium, chloride, and potassium) or 
calories (such as dextrose and amino acids);
133 
(5) STANDARDS.—Subchapter H of chapter V, 
as added by section 202, is amended by adding at 
the end the following: 
‘‘SEC. 583. NATIONAL STANDARDS FOR PRESCRIPTION 
DRUG WHOLESALE DISTRIBUTORS. 
‘‘(a) IN GENERAL.—The Secretary shall, not later 
than 2 years after the date of enactment of the Drug Sup-
ply Chain Security Act, establish by regulation standards 
for the licensing of persons under section 503(e)(1) (as 
amended by the Drug Supply Chain Security Act), includ-
ing the revocation, reissuance, and renewal of such license. 
‘‘(b) CONTENT.—For the purpose of ensuring uni-
formity with respect to standards set forth in this section, 
the standards established under subsection (a) shall apply 
to all State and Federal licenses described under section 
503(e)(1) (as amended by the Drug Supply Chain Secu-
rity Act) and shall include standards for the following: 
‘‘(1) The storage and handling of prescription 
drugs, including facility requirements. 
‘‘(2) The establishment and maintenance of 
records of the distributions of such drugs. 
‘‘(3) The furnishing of a bond or other equiva-
lent means of security, as follows: 
‘‘(A)(i) For the issuance or renewal of a 
wholesale distributor license, an applicant that
134 
is not a government owned and operated whole-
sale distributor shall submit a surety bond of 
$100,000 or other equivalent means of security 
acceptable to the State. 
‘‘(ii) For purposes of clause (i), the State 
or other applicable authority may accept a sur-
ety bond in the amount of $25,000 if the an-
nual gross receipts of the previous tax year for 
the wholesaler is $10,000,000 or less. 
‘‘(B) If a wholesale distributor can provide 
evidence that it possesses the required bond in 
a State, the requirement for a bond in another 
State shall be waived. 
‘‘(4) 
Mandatory 
background 
checks 
and 
fingerprinting of facility managers or designated 
representatives. 
‘‘(5) The establishment and implementation of 
qualifications for key personnel. 
‘‘(6) The mandatory physical inspection of any 
facility to be used in wholesale distribution within a 
reasonable time frame from the initial application of 
the facility and to be conducted by the licensing au-
thority or by the State, consistent with subsection 
(c).
135 
‘‘(7) In accordance with subsection (d), the pro-
hibition of certain persons from receiving or main-
taining licensure for wholesale distribution. 
‘‘(c) INSPECTIONS.—To satisfy the inspection re-
quirement under subsection (b)(6), the Federal or State 
licensing authority may conduct the inspection or may ac-
cept an inspection by the State in which the facility is lo-
cated, or by a third-party accreditation or inspection serv-
ice approved by the Secretary or the State licensing such 
wholesale distributor. 
‘‘(d) PROHIBITED PERSONS.—The standards estab-
lished under subsection (a) shall include requirements to 
prohibit a person from receiving or maintaining licensure 
for wholesale distribution if the person— 
‘‘(1) has been convicted of any felony for con-
duct relating to wholesale distribution, any felony 
violation of subsection (i) or (k) of section 301, or 
any felony violation of section 1365 of title 18, 
United States Code, relating to product tampering; 
or 
‘‘(2) has engaged in a pattern of violating the 
requirements of this section, or State requirements 
for licensure, that presents a threat of serious ad-
verse health consequences or death to humans.
136 
‘‘(e) REQUIREMENTS.—The Secretary, in promul-
gating any regulation pursuant to this section, shall, not-
withstanding section 553 of title 5, United States Code— 
‘‘(1) issue a notice of proposed rulemaking that 
includes a copy of the proposed regulation; 
‘‘(2) provide a period of not less than 60 days 
for comments on the proposed regulation; and 
‘‘(3) provide that the final regulation take effect 
on the date that is 2 years after the date such final 
regulation is published.’’. 
(b) AUTHORIZED DISTRIBUTORS OF RECORD.—Sec-
tion 503(d) (21 U.S.C. 353(d)) is amended by adding at 
the end the following: 
‘‘(4) In this subsection, the term ‘authorized 
distributors of record’ means those distributors with 
whom a manufacturer has established an ongoing re-
lationship to distribute such manufacturer’s prod-
ucts.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
subsections (a) and (b) shall take effect on January 1, 
2015.
137 
SEC. 205. NATIONAL STANDARDS FOR THIRD-PARTY LOGIS-
TICS PROVIDERS; UNIFORM NATIONAL POL-
ICY. 
Subchapter H of chapter V, as amended by section 
204, is further amended by adding at the end the fol-
lowing: 
‘‘SEC. 584. NATIONAL STANDARDS FOR THIRD-PARTY LO-
GISTICS PROVIDERS. 
‘‘(a) REQUIREMENTS.—No third-party logistics pro-
vider in any State may conduct activities in any State un-
less each facility of such third-party logistics provider— 
‘‘(1)(A) is licensed by the State from which the 
drug is distributed by the third-party logistics pro-
vider, in accordance with the regulations promul-
gated under subsection (d); or 
‘‘(B) if the State from which the drug distrib-
uted by the third-party logistics provider has not es-
tablished a licensure requirement, is licensed by the 
Secretary, in accordance with the regulations pro-
mulgated under subsection (d); and 
‘‘(2) if the drug is distributed interstate, is li-
censed by the State into which the drug is distrib-
uted by the third-party logistics provider if such 
State licenses third-party logistics providers that dis-
tribute drugs into the State and the third-party lo-
138 
gistics provider is not licensed by the Secretary as 
described in paragraph (1)(B). 
‘‘(b) REPORTING.—Beginning 1 year after the date 
of enactment of the Drug Supply Chain Security Act, a 
facility of a third-party logistics provider shall report to 
the Secretary, on an annual basis pursuant to a schedule 
determined by the Secretary— 
‘‘(1) the State by which the facility is licensed 
and the appropriate identification number of such li-
cense; and 
‘‘(2) the name and address of the facility and 
all trade names under which such facility conducts 
business. 
‘‘(c) COSTS.— 
‘‘(1) AUTHORIZED FEES OF SECRETARY.—If a 
State does not establish a licensing program for a 
third-party logistics provider, the Secretary shall li-
cense the third-party logistics provider located in 
such State and may collect a reasonable fee in such 
amount necessary to reimburse the Secretary for 
costs associated with establishing and administering 
the licensure program and conducting periodic in-
spections under this section. The Secretary shall ad-
just fee rates as needed on an annual basis to gen-
erate only the amount of revenue needed to perform
139 
this service. Fees authorized under this paragraph 
shall be collected and available for obligation only to 
the extent and in the amount provided in advance in 
appropriations Acts. Such fees are authorized to re-
main available until expended. Such sums as may be 
necessary may be transferred from the Food and 
Drug Administration salaries and expenses appro-
priation account without fiscal year limitation to 
such appropriation account for salaries and expenses 
with such fiscal year limitation. 
‘‘(2) STATE LICENSING FEES.— 
‘‘(A) STATE
ESTABLISHED
PROGRAM.— 
Nothing in this Act shall prohibit a State that 
has established a program to license a third- 
party logistics provider from collecting fees 
from a third-party logistics provider for such a 
license. 
‘‘(B) 
NO
STATE
ESTABLISHED
PRO-
GRAM.—A State that does not establish a pro-
gram to license a third-party logistics provider 
in accordance with this section shall be prohib-
ited from collecting a State licensing fee from 
a third-party logistics provider. 
‘‘(d) REGULATIONS.—
140 
‘‘(1) IN
GENERAL.—Not later than 2 years 
after the date of enactment of the Drug Supply 
Chain Security Act, the Secretary shall issue regula-
tions regarding the standards for licensing under 
subsection 
(a), 
including 
the 
revocation 
and 
reissuance of such license, to third-party logistics 
providers under this section. 
‘‘(2) CONTENT.—Such regulations shall— 
‘‘(A) establish a process by which a third- 
party accreditation program approved by the 
Secretary shall, upon request by a third-party 
logistics provider, issue a license to each third- 
party logistics provider that meets the require-
ments set forth in this section; 
‘‘(B) establish a process by which the Sec-
retary shall issue a license to each third-party 
logistics provider that meets the requirements 
set forth in this section if the Secretary is not 
able to approve a third-party accreditation pro-
gram because no such program meets the Sec-
retary’s requirements necessary for approval of 
such a third-party accreditation program; 
‘‘(C) require that the entity complies with 
storage practices, as determined by the Sec-
retary for such facility, including—
141 
‘‘(i) maintaining access to warehouse 
space of suitable size to facilitate safe op-
erations, including a suitable area to quar-
antine suspect product; 
‘‘(ii) maintaining adequate security; 
and 
‘‘(iii) having written policies and pro-
cedures to— 
‘‘(I) address receipt, security, 
storage, inventory, shipment, and dis-
tribution of a product; 
‘‘(II) identify, record, and report 
confirmed losses or thefts in the 
United States; 
‘‘(III) correct errors and inac-
curacies in inventories; 
‘‘(IV) provide support for manu-
facturer recalls; 
‘‘(V) prepare for, protect against, 
and address any reasonably foresee-
able crisis that affects security or op-
eration at the facility, such as a 
strike, fire, or flood; 
‘‘(VI) ensure that any expired 
product is segregated from other
142 
products and returned to the manu-
facturer or repackager or destroyed; 
‘‘(VII) maintain the capability to 
trace the receipt and outbound dis-
tribution of a product, and supplies 
and records of inventory; and 
‘‘(VIII) quarantine or destroy a 
suspect product if directed to do so by 
the respective manufacturer, wholesale 
distributor, dispenser, or an author-
ized government agency; 
‘‘(D) provide for periodic inspection by the 
licensing authority, as determined by the Sec-
retary, of such facility warehouse space to en-
sure compliance with this section; 
‘‘(E) prohibit a facility from having as a 
manager or designated representative anyone 
convicted of any felony violation of subsection 
(i) or (k) of section 301 or any violation of sec-
tion 1365 of title 18, United States Code relat-
ing to product tampering; 
‘‘(F) provide for mandatory background 
checks of a facility manager or a designated 
representative of such manager;
143 
‘‘(G) require a third-party logistics pro-
vider to provide the applicable licensing author-
ity, upon a request by such authority, a list of 
all product manufacturers, wholesale distribu-
tors, and dispensers for whom the third-party 
logistics provider provides services at such facil-
ity; and 
‘‘(H) include procedures under which any 
third-party logistics provider license— 
‘‘(i) expires on the date that is 3 
years after issuance of the license; and 
‘‘(ii) may be renewed for additional 3- 
year periods. 
‘‘(3) PROCEDURE.—In promulgating the regula-
tions under this subsection, the Secretary shall, not-
withstanding section 553 of title 5, United States 
Code— 
‘‘(A) issue a notice of proposed rulemaking 
that includes a copy of the proposed regulation; 
‘‘(B) provide a period of not less than 60 
days for comments on the proposed regulation; 
and 
‘‘(C) provide that the final regulation takes 
effect upon the expiration of 1 year after the 
date that such final regulation is issued.
144 
‘‘(e) VALIDITY.—A license issued under this section 
shall remain valid as long as such third-party logistics pro-
vider remains licensed consistent with this section. If the 
Secretary finds that the third-party accreditation program 
demonstrates that all applicable requirements for licensure 
under this section are met, the Secretary shall issue a li-
cense under this section to a third-party logistics provider 
receiving accreditation, pursuant to subsection (d)(2)(A). 
‘‘SEC. 585. UNIFORM NATIONAL POLICY. 
‘‘(a) PRODUCT TRACING
AND OTHER REQUIRE-
MENTS.—Beginning on the date of enactment of the Drug 
Supply Chain Security Act, no State or political subdivi-
sion of a State may establish or continue in effect any 
requirements for tracing products through the distribution 
system (including any requirements with respect to state-
ments of distribution history, transaction history, trans-
action information, or transaction statement of a product 
as such product changes ownership in the supply chain, 
or verification, investigation, disposition, notification, or 
recordkeeping relating to such systems, including paper or 
electronic pedigree systems or for tracking and tracing 
drugs throughout the distribution system) which are in-
consistent with, more stringent than, or in addition to, any 
requirements applicable under section 503(e) (as amended
145 
by such Act) or this subchapter (or regulations issued 
thereunder), or which are inconsistent with— 
‘‘(1) any waiver, exception, or exemption pursu-
ant to section 581 or 582; or 
‘‘(2) any restrictions specified in section 582. 
‘‘(b) WHOLESALE DISTRIBUTOR AND THIRD-PARTY 
LOGISTICS PROVIDER STANDARDS.— 
‘‘(1) IN GENERAL.—Beginning on the date of 
enactment of the Drug Supply Chain Security Act, 
no State or political subdivision of a State may es-
tablish or continue any standards, requirements, or 
regulations with respect to wholesale prescription 
drug distributor or third-party logistics provider li-
censure that are inconsistent with, less stringent 
than, directly related to, or covered by the standards 
and requirements applicable under section 503(e) 
(as amended by such Act), in the case of a wholesale 
distributor, or section 584, in the case of a third- 
party logistics provider. 
‘‘(2) STATE REGULATION OF THIRD-PARTY LO-
GISTICS PROVIDERS.—No State shall regulate third- 
party logistics providers as wholesale distributors. 
‘‘(3) ADMINISTRATION FEES.—Notwithstanding 
paragraph (1), a State may administer fee collec-
tions for effectuating the wholesale drug distributor
146 
and third-party logistics provider licensure require-
ments under sections 503(e) (as amended by the 
Drug Supply Chain Security Act), 583, and 584. 
‘‘(4) ENFORCEMENT, SUSPENSION, AND
REV-
OCATION.—Notwithstanding 
paragraph 
(1), 
a 
State— 
‘‘(A) may take administrative action, in-
cluding fines, to enforce a requirement promul-
gated by the State in accordance with section 
503(e) (as amended by the Drug Supply Chain 
Security Act) or this subchapter; 
‘‘(B) may provide for the suspension or 
revocation of licenses issued by the State for 
violations of the laws of such State; 
‘‘(C) upon conviction of violations of Fed-
eral, State, or local drug laws or regulations, 
may provide for fines, imprisonment, or civil 
penalties; and 
‘‘(D) may regulate activities of licensed en-
tities in a manner that is consistent with prod-
uct tracing requirements under section 582. 
‘‘(c) EXCEPTION.—Nothing in this section shall be 
construed to preempt State requirements related to the 
distribution of prescription drugs if such requirements are 
not related to product tracing as described in subsection
147 
(a) or wholesale distributor and third-party logistics pro-
vider licensure as described in subsection (b) applicable 
under section 503(e) (as amended by the Drug Supply 
Chain Security Act) or this subchapter (or regulations 
issued thereunder).’’. 
SEC. 206. PENALTIES. 
(a) PROHIBITED ACT.—Section 301(t) (21 U.S.C. 
331(t)), is amended— 
(1) by striking ‘‘or’’ after ‘‘the requirements of 
section 503(d),’’; and 
(2) by inserting ‘‘, failure to comply with the 
requirements under section 582, the failure to com-
ply with the requirements under section 584, as ap-
plicable,’’ after ‘‘in violation of section 503(e)’’. 
(b) MISBRANDING.—Section 502 (21 U.S.C. 352), as 
amended by section 103, is further amended by adding 
at the end the following: 
‘‘(cc) If it is a drug and it fails to bear the product 
identifier as required by section 582.’’. 
SEC. 207. CONFORMING AMENDMENT. 
(a) IN GENERAL.—Section 303(b)(1)(D) (21 U.S.C. 
333(b)(1)(D)) is amended by striking ‘‘503(e)(2)(A)’’ and 
inserting ‘‘503(e)(1)’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall take effect on January 1, 2015.
148 
SEC. 208. SAVINGS CLAUSE. 
Except as provided in the amendments made by para-
graphs (1), (2), and (3) of section 204(a) and by section 
206(a), nothing in this title (including the amendments 
made by this title) shall be construed as altering any au-
thority of the Secretary of Health and Human Services 
with respect to a drug subject to section 503(b)(1) of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
353(b)(1)) under any other provision of such Act or the 
Public Health Service Act (42 U.S.C. 201 et seq.). 
Passed the House of Representatives September 28, 
2013. 
Attest: 
Clerk.
113TH CONGRESS 
1ST SESSION 
H. R. 3204 
AN ACT 
To amend the Federal Food, Drug, and Cosmetic 
Act with respect to human drug compounding 
and drug supply chain security, and for other 
purposes.