655
‘‘(6) NONSUBORDINATION.—The secured loan 
shall not be subordinated to the claims of any holder 
of project obligations in the event of bankruptcy, in-
solvency, or liquidation of the obligor. 
‘‘(7) FEES.—The Secretary may establish fees 
at a level sufficient to cover all or a portion of the 
costs to the Federal Government of making a se-
cured loan under this section. 
‘‘(c) REPAYMENT.—
‘‘(1) SCHEDULE.—The Secretary shall establish 
a repayment schedule for each secured loan under 
this section based on the projected cash flow from 
project revenues and other repayment sources. 
‘‘(2) COMMENCEMENT.—Scheduled loan repay-
ments of principal or interest on a secured loan 
under this section shall commence not later than 5 
years after the date of substantial completion of the 
project. 
‘‘(3) SOURCES
OF
REPAYMENT
FUNDS.—The 
sources of funds for scheduled loan repayments 
under this section shall include any revenue gen-
erated by the project. 
‘‘(4) DEFERRED PAYMENTS.—
‘‘(A) AUTHORIZATION.—If, at any time 
during the 10 years after the date of substan-
656
tial completion of the project, the project is un-
able to generate sufficient revenues to pay the 
scheduled loan repayments of principal and in-
terest on the secured loan, the Secretary may, 
subject to subparagraph (C), allow the obligor 
to add unpaid principal and interest to the out-
standing balance of the secured loan. 
‘‘(B) INTEREST.—Any payment deferred 
under subparagraph (A) shall—
‘‘(i) continue to accrue interest in ac-
cordance with subsection (b)(4) until fully 
repaid; and 
‘‘(ii) be scheduled to be amortized 
over the remaining term of the loan begin-
ning not later than 10 years after the date 
of substantial completion of the project in 
accordance with paragraph (1). 
‘‘(C) CRITERIA.—
‘‘(i) IN GENERAL.—Any payment de-
ferral under subparagraph (A) shall be 
contingent on the project meeting criteria 
established by the Secretary. 
‘‘(ii) REPAYMENT
STANDARDS.—The 
criteria established under clause (i) shall
657
include standards for reasonable assurance 
of repayment. 
‘‘(5) PREPAYMENT.—
‘‘(A) USE
OF
EXCESS
REVENUES.—Any 
excess revenues that remain after satisfying 
scheduled debt service requirements on the 
project obligations and secured loan and all de-
posit requirements under the terms of any trust 
agreement, bond resolution, reimbursement 
agreement, credit agreement, loan agreement, 
or similar agreement securing project obliga-
tions may be applied annually to prepay the se-
cured loan without penalty. 
‘‘(B) 
USE
OF
PROCEEDS
OF
REFI-
NANCING.—The secured loan may be prepaid at 
any time without penalty, regardless of whether 
such repayment is from the proceeds of refi-
nancing from non-Federal funding sources.
‘‘(6) FORGIVENESS
OF
INDEBTEDNESS.—The 
Secretary may forgive a loan secured under this title 
under terms and conditions that are analogous to 
the loan forgiveness provision for student loans 
under part D of title IV of the Higher Education 
Act of 1965 (20 U.S.C. 1087a et seq.), except that
658
the Secretary shall condition such forgiveness on the 
establishment by the project of—
‘‘(A) an outreach program for cancer pre-
vention, early diagnosis, and treatment that 
provides services to a substantial majority of 
the residents of a State or region, including 
residents of rural areas; 
‘‘(B) an outreach program for cancer pre-
vention, early diagnosis, and treatment that 
provides services to multiple Indian tribes; and 
‘‘(C)(i) unique research resources (such as 
population databases); or 
‘‘(ii) an affiliation with an entity that has 
unique research resources. 
‘‘(d) SALE OF SECURED LOANS.—
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
as soon as practicable after substantial completion of 
a project and after notifying the obligor, the Sec-
retary may sell to another entity or reoffer into the 
capital markets a secured loan for the project if the 
Secretary determines that the sale or reoffering can 
be made on favorable terms. 
‘‘(2) CONSENT OF OBLIGOR.—In making a sale 
or reoffering under paragraph (1), the Secretary 
may not change the original terms and conditions of
659
the secured loan without the written consent of the 
obligor. 
‘‘(e) LOAN GUARANTEES.—
‘‘(1) IN GENERAL.—The Secretary may provide 
a loan guarantee to a lender in lieu of making a se-
cured loan if the Secretary determines that the 
budgetary cost of the loan guarantee is substantially 
the same as that of a secured loan. 
‘‘(2) TERMS.—The terms of a guaranteed loan 
shall be consistent with the terms set forth in this 
section for a secured loan, except that the rate on 
the guaranteed loan and any prepayment features 
shall be negotiated between the obligor and the lend-
er, with the consent of the Secretary. 
‘‘SEC. 2204. LINES OF CREDIT. 
‘‘(a) IN GENERAL.—
‘‘(1) AGREEMENTS.—Subject to paragraphs (2) 
through (4), the Secretary may enter into agree-
ments to make available lines of credit to 1 or more 
obligors in the form of direct loans to be made by 
the Secretary at future dates on the occurrence of 
certain events for any project selected under section 
2202. 
‘‘(2) USE OF PROCEEDS.—The proceeds of a 
line of credit made available under this section shall
660
be available to pay debt service on project obliga-
tions issued to finance eligible project costs, extraor-
dinary repair and replacement costs, operation and 
maintenance expenses, and costs associated with un-
expected Federal or State environmental restrictions. 
‘‘(3) RISK ASSESSMENT.—Before entering into 
an agreement for a secured loan under this sub-
section, the Secretary, in consultation with each rat-
ing agency providing a rating letter under section 
2202(b)(2)(B), shall determine an appropriate sub-
sidy amount for each secured loan, taking into ac-
count such letter. 
‘‘(4) INVESTMENT-GRADE
RATING
REQUIRE-
MENT.—The funding of a line of credit under this 
section shall be contingent on the project’s senior 
obligations receiving an investment-grade rating 
from at least 1 rating agency. 
‘‘(b) TERMS AND LIMITATIONS.—
‘‘(1) IN GENERAL.—A line of credit under this 
section with respect to a project shall be on such 
terms and conditions and contain such covenants, 
representations, warranties, and requirements (in-
cluding requirements for audits) as the Secretary de-
termines appropriate. 
‘‘(2) MAXIMUM AMOUNTS.—
661
‘‘(A) TOTAL AMOUNT.—The total amount 
of the line of credit shall not exceed 33 percent 
of the reasonably anticipated eligible project 
costs. 
‘‘(B) 1-YEAR DRAWS.—The amount drawn 
in any 1 year shall not exceed 20 percent of the 
total amount of the line of credit.
‘‘(3) DRAWS.—Any draw on the line of credit 
shall represent a direct loan and shall be made only 
if net revenues from the project (including capital-
ized interest, any debt service reserve fund, and any 
other available reserve) are insufficient to pay the 
costs specified in subsection (a)(2). 
‘‘(4) INTEREST RATE.—The interest rate on a 
direct loan resulting from a draw on the line of cred-
it shall be not less than the yield on 30-year market-
able United States Treasury securities as of the date 
on which the line of credit is obligated. 
‘‘(5) SECURITY.—The line of credit—
‘‘(A) shall—
‘‘(i) be payable, in whole or in part, 
from reliable revenue sources; and 
‘‘(ii) include a rate covenant, coverage 
requirement, or similar security feature 
supporting the project obligations; and
662
‘‘(B) may have a lien on revenues de-
scribed in subparagraph (A) subject to any lien 
securing project obligations. 
‘‘(6) PERIOD
OF
AVAILABILITY.—The line of 
credit shall be available during the period beginning 
on the date of substantial completion of the project 
and ending not later than 10 years after that date. 
‘‘(7) RIGHTS OF THIRD-PARTY CREDITORS.—
‘‘(A) AGAINST FEDERAL GOVERNMENT.—A 
third-party creditor of the obligor shall not have 
any right against the Federal Government with 
respect to any draw on the line of credit. 
‘‘(B) ASSIGNMENT.—An obligor may as-
sign the line of credit to 1 or more lenders or 
to a trustee on the lenders’ behalf. 
‘‘(8) 
NONSUBORDINATION.—A 
direct 
loan 
under this section shall not be subordinated to the 
claims of any holder of project obligations in the 
event of bankruptcy, insolvency, or liquidation of the 
obligor. 
‘‘(9) FEES.—The Secretary may establish fees 
at a level sufficient to cover all or a portion of the 
costs to the Federal Government of providing a line 
of credit under this section.
663
‘‘(10) RELATIONSHIP
TO
OTHER
CREDIT
IN-
STRUMENTS.—A project that receives a line of credit 
under this section also shall not receive a secured 
loan or loan guarantee under section 2203 of an 
amount that, combined with the amount of the line 
of credit, exceeds 100 percent of eligible project 
costs. 
‘‘(c) REPAYMENT.—
‘‘(1) TERMS AND CONDITIONS.—The Secretary 
shall establish repayment terms and conditions for 
each direct loan under this section based on the pro-
jected cash flow from project revenues and other re-
payment sources. 
‘‘(2) TIMING.—All scheduled repayments of 
principal or interest on a direct loan under this sec-
tion shall commence not later than 5 years after the 
end of the period of availability specified in sub-
section (b)(6) and be fully repaid, with interest, by 
the date that is 25 years after the end of the period 
of availability specified in subsection (b)(6). 
‘‘(3) SOURCES
OF
REPAYMENT
FUNDS.—The 
sources of funds for scheduled loan repayments 
under this section shall include reliable revenue 
sources.
664
‘‘SEC. 2205. PROJECT SERVICING. 
‘‘(a) REQUIREMENT.—The State in which a project 
that receives financial assistance under this title is located 
may identify a local servicer to assist the Secretary in 
servicing the Federal credit instrument made available 
under this title. 
‘‘(b) AGENCY; FEES.—If a State identifies a local 
servicer under subsection (a), the local servicer—
‘‘(1) shall act as the agent for the Secretary; 
and 
‘‘(2) may receive a servicing fee, subject to ap-
proval by the Secretary. 
‘‘(c) LIABILITY.—A local servicer identified under 
subsection (a) shall not be liable for the obligations of the 
obligor to the Secretary or any lender. 
‘‘(d) ASSISTANCE FROM EXPERT FIRMS.—The Sec-
retary may retain the services of expert firms in the field 
of project finance to assist in the underwriting and serv-
icing of Federal credit instruments. 
‘‘SEC. 2206. STATE AND LOCAL PERMITS. 
‘‘The provision of financial assistance under this title 
with respect to a project shall not—
‘‘(1) relieve any recipient of the assistance of 
any obligation to obtain any required State or local 
permit or approval with respect to the project;
665
‘‘(2) limit the right of any unit of State or local 
government to approve or regulate any rate of re-
turn on private equity invested in the project; or 
‘‘(3) otherwise supersede any State or local law 
(including any regulation) applicable to the construc-
tion or operation of the project. 
‘‘SEC. 2207. REGULATIONS. 
‘‘The Secretary may issue such regulations as the 
Secretary determines appropriate to carry out this title. 
‘‘SEC. 2208. FUNDING. 
‘‘(a) FUNDING.—
‘‘(1) IN GENERAL.—There are authorized to be 
appropriated to carry out this title, $49,000,000 to 
remain available during the period beginning on July 
1, 2004 and ending on September 30, 2008. 
‘‘(2) ADMINISTRATIVE
COSTS.—From funds 
made available under paragraph (1), the Secretary 
may use, for the administration of this title, not 
more than $2,000,000 for each of fiscal years 2004 
through 2008. 
‘‘(b) CONTRACT AUTHORITY.—Notwithstanding any 
other provision of law, approval by the Secretary of a Fed-
eral credit instrument that uses funds made available 
under this title shall be deemed to be acceptance by the
666
United States of a contractual obligation to fund the Fed-
eral credit instrument. 
‘‘(c) AVAILABILITY.—Amounts appropriated under 
this section shall be available for obligation on July 1, 
2004. 
‘‘SEC. 2209. REPORT TO CONGRESS. 
‘‘Not later than 4 years after the date of enactment 
of this title, the Secretary shall submit to Congress a re-
port summarizing the financial performance of the 
projects that are receiving, or have received, assistance 
under this title, including a recommendation as to whether 
the objectives of this title are best served—
‘‘(1) by continuing the program under the au-
thority of the Secretary; 
‘‘(2) by establishing a Government corporation 
or Government-sponsored enterprise to administer 
the program; or 
‘‘(3) by phasing out the program and relying on 
the capital markets to fund the types of infrastruc-
ture investments assisted by this title without Fed-
eral participation.’’.
667
SEC. 609. CAPITAL INFRASTRUCTURE REVOLVING LOAN 
PROGRAM. 
(a) IN GENERAL.—Part A of title XVI of the Public 
Health Service Act (42 U.S.C. 300q et seq.) is amended 
by adding at the end the following new section: 
‘‘CAPITAL INFRASTRUCTURE REVOLVING LOAN PROGRAM 
‘‘SEC. 1603. (a) AUTHORITY TO MAKE AND GUAR-
ANTEE LOANS.—
‘‘(1) AUTHORITY TO MAKE LOANS.—The Sec-
retary may make loans from the fund established 
under section 1602(d) to any rural entity for 
projects for capital improvements, including—
‘‘(A) the acquisition of land necessary for 
the capital improvements;
‘‘(B) the renovation or modernization of 
any building; 
‘‘(C) the acquisition or repair of fixed or 
major movable equipment; and 
‘‘(D) such other project expenses as the 
Secretary determines appropriate. 
‘‘(2) AUTHORITY TO GUARANTEE LOANS.—
‘‘(A) IN
GENERAL.—The Secretary may 
guarantee the payment of principal and interest 
for loans made to rural entities for projects for 
any capital improvement described in paragraph 
(1) to any non-Federal lender.
668
‘‘(B) INTEREST SUBSIDIES.—In the case 
of a guarantee of any loan made to a rural enti-
ty under subparagraph (A), the Secretary may 
pay to the holder of such loan, for and on be-
half of the project for which the loan was made, 
amounts sufficient to reduce (by not more than 
3 percent) the net effective interest rate other-
wise payable on such loan. 
‘‘(b) AMOUNT OF LOAN.—The principal amount of 
a loan directly made or guaranteed under subsection (a) 
for a project for capital improvement may not exceed 
$5,000,000. 
‘‘(c) FUNDING LIMITATIONS.—
‘‘(1) GOVERNMENT
CREDIT
SUBSIDY
EXPO-
SURE.—The total of the Government credit subsidy 
exposure under the Credit Reform Act of 1990 scor-
ing protocol with respect to the loans outstanding at 
any time with respect to which guarantees have been 
issued, or which have been directly made, under sub-
section (a) may not exceed $50,000,000 per year. 
‘‘(2) TOTAL AMOUNTS.—Subject to paragraph 
(1), the total of the principal amount of all loans di-
rectly made or guaranteed under subsection (a) may 
not exceed $250,000,000 per year.
669
‘‘(d) 
CAPITAL
ASSESSMENT
AND
PLANNING 
GRANTS.—
‘‘(1) NONREPAYABLE
GRANTS.—Subject to 
paragraph (2), the Secretary may make a grant to 
a rural entity, in an amount not to exceed $50,000, 
for purposes of capital assessment and business 
planning. 
‘‘(2) LIMITATION.—The cumulative total of 
grants awarded under this subsection may not ex-
ceed $2,500,000 per year. 
‘‘(e) TERMINATION OF AUTHORITY.—The Secretary 
may not directly make or guarantee any loan under sub-
section (a) or make a grant under subsection (d) after 
September 30, 2008.’’. 
(b) RURAL ENTITY DEFINED.—Section 1624 of the 
Public Health Service Act (42 U.S.C. 300s–3) is amended 
by adding at the end the following new paragraph: 
‘‘(14)(A) The term ‘rural entity’ includes—
‘‘(i) a rural health clinic, as defined in sec-
tion 1861(aa)(2) of the Social Security Act; 
‘‘(ii) any medical facility with at least 1 
bed, but with less than 50 beds, that is located 
in—
‘‘(I) a county that is not part of a 
metropolitan statistical area; or
670
‘‘(II) a rural census tract of a metro-
politan statistical area (as determined 
under the most recent modification of the 
Goldsmith Modification, originally pub-
lished in the Federal Register on February 
27, 1992 (57 Fed. Reg. 6725)); 
‘‘(iii) a hospital that is classified as a 
rural, regional, or national referral center under 
section 1886(d)(5)(C) of the Social Security 
Act; and 
‘‘(iv) a hospital that is a sole community 
hospital 
(as 
defined 
in 
section 
1886(d)(5)(D)(iii) of the Social Security Act). 
‘‘(B) For purposes of subparagraph (A), the 
fact that a clinic, facility, or hospital has been geo-
graphically reclassified under the medicare program 
under title XVIII of the Social Security Act shall not 
preclude a hospital from being considered a rural en-
tity under clause (i) or (ii) of subparagraph (A).’’.
(c) CONFORMING AMENDMENTS.—Section 1602 of 
the Public Health Service Act (42 U.S.C. 300q–2) is 
amended—
(1) in subsection (b)(2)(D), by inserting ‘‘or 
1603(a)(2)(B)’’ after ‘‘1601(a)(2)(B)’’; and 
(2) in subsection (d)—
671
(A) in paragraph (1)(C), by striking ‘‘sec-
tion 1601(a)(2)(B)’’ and inserting ‘‘sections 
1601(a)(2)(B) and 1603(a)(2)(B)’’; and 
(B) in paragraph (2)(A), by inserting ‘‘or 
1603(a)(2)(B)’’ after ‘‘1601(a)(2)(B)’’. 
SEC. 610. FEDERAL REIMBURSEMENT OF EMERGENCY 
HEALTH SERVICES FURNISHED TO UNDOCU-
MENTED ALIENS. 
(a) TOTAL AMOUNT AVAILABLE FOR ALLOTMENT.—
There is appropriated, out of any funds in the Treasury 
not otherwise appropriated, $250,000,000 for each of fis-
cal years 2005 through 2008, for the purpose of making 
allotments under this section to States described in para-
graph (1) or (2) of subsection (b). Funds appropriated 
under the preceding sentence shall remain available until 
expended. 
(b) STATE ALLOTMENTS.—
(1) BASED
ON
PERCENTAGE
OF
UNDOCU-
MENTED ALIENS.—
(A) IN GENERAL.—Out of the amount ap-
propriated under subsection (a) for a fiscal 
year, the Secretary shall use $167,000,000 of 
such amount to make allotments for such fiscal 
year in accordance with subparagraph (B).
672
(B) FORMULA.—The amount of the allot-
ment for each State for a fiscal year shall be 
equal to the product of—
(i) the total amount available for al-
lotments under this paragraph for the fis-
cal year; and 
(ii) the percentage of undocumented 
aliens residing in the State with respect to 
the total number of such aliens residing in 
all States, as determined by the Statistics 
Division of the Immigration and Natu-
ralization Service, as of January 2003, 
based on the 2000 decennial census. 
(2) BASED
ON
NUMBER
OF
UNDOCUMENTED 
ALIEN APPREHENSION STATES.—
(A) IN GENERAL.—Out of the amount ap-
propriated under subsection (a) for a fiscal 
year, the Secretary shall use $83,000,000 of 
such amount to make allotments for such fiscal 
year for each of the 6 States with the highest 
number of undocumented alien apprehensions 
for such fiscal year. 
(B) DETERMINATION OF ALLOTMENTS.—
The amount of the allotment for each State de-
scribed in subparagraph (A) for a fiscal year
673
shall bear the same ratio to the total amount 
available for allotments under this paragraph 
for the fiscal year as the ratio of the number 
of undocumented alien apprehensions in the 
State in that fiscal year bears to the total of 
such numbers for all such States for such fiscal 
year. 
(C) DATA.—For purposes of this para-
graph, the highest number of undocumented 
alien apprehensions for a fiscal year shall be 
based on the 4 most recent quarterly apprehen-
sion rates for undocumented aliens in such 
States, as reported by the Immigration and 
Naturalization Service. 
(3) RULE OF CONSTRUCTION.—Nothing in this 
section shall be construed as prohibiting a State that 
is described in both of paragraphs (1) and (2) from 
receiving an allotment under both paragraphs for a 
fiscal year. 
(c) USE OF FUNDS.—
(1) AUTHORITY
TO
MAKE
PAYMENTS.—From 
the allotments made for a State under subsection (b) 
for a fiscal year, the Secretary shall pay directly to 
local governments, hospitals, or other providers lo-
cated in the State (including providers of services re-
674
ceived through an Indian Health Service facility 
whether operated by the Indian Health Service or by 
an Indian tribe or tribal organization) that provide 
uncompensated emergency health services furnished
to undocumented aliens during that fiscal year, and 
to the State, such amounts (subject to the total 
amount available from such allotments) as the local 
governments, hospitals, providers, or State dem-
onstrate were incurred for the provision of such 
services during that fiscal year. 
(2) LIMITATION ON STATE USE OF FUNDS.—
Funds paid to a State from allotments made under 
subsection (b) for a fiscal year may only be used for 
making payments to local governments, hospitals, or 
other providers for costs incurred in providing emer-
gency health services to undocumented aliens or for 
State costs incurred with respect to the provision of 
emergency health services to such aliens. 
(3) INCLUSION OF COSTS INCURRED WITH RE-
SPECT TO CERTAIN ALIENS.—Uncompensated emer-
gency health services furnished to aliens who have 
been allowed to enter the United States for the sole 
purpose of receiving emergency health services may 
be included in the determination of costs incurred by
675
a State, local government, hospital, or other provider 
with respect to the provision of such services. 
(d) APPLICATIONS; ADVANCE PAYMENTS.—
(1) DEADLINE FOR ESTABLISHMENT OF APPLI-
CATION PROCESS.—
(A) IN
GENERAL.—Not later than Sep-
tember 1, 2004, the Secretary shall establish a 
process under which States, local governments, 
hospitals, or other providers located in the 
State may apply for payments from allotments 
made under subsection (b) for a fiscal year for 
uncompensated emergency health services fur-
nished to undocumented aliens during that fis-
cal year. 
(B) INCLUSION OF MEASURES TO COMBAT 
FRAUD.—The Secretary shall include in the 
process established under subparagraph (A) 
measures to ensure that fraudulent payments 
are not made from the allotments determined 
under subsection (b). 
(2) ADVANCE
PAYMENT; RETROSPECTIVE
AD-
JUSTMENT.—The process established under para-
graph (1) shall allow for making payments under 
this section for each quarter of a fiscal year on the 
basis of advance estimates of expenditures submitted
676
by applicants for such payments and such other in-
vestigation as the Secretary may find necessary, and 
for making reductions or increases in the payments 
as necessary to adjust for any overpayment or un-
derpayment for prior quarters of such fiscal year. 
(e) DEFINITIONS.—In this section: 
(1) HOSPITAL.—The term ‘‘hospital’’ has the 
meaning given such term in section 1861(e) of the 
Social Security Act (42 U.S.C. 1395x(e)). 
(2) INDIAN
TRIBE; TRIBAL
ORGANIZATION.—
The terms ‘‘Indian tribe’’ and ‘‘tribal organization’’ 
have the meanings given such terms in section 4 of 
the Indian Health Care Improvement Act (25 U.S.C. 
1603). 
(3) PROVIDER.—The term ‘‘provider’’ includes 
a physician, any other health care professional li-
censed under State law, and any other entity that 
furnishes emergency health services, including ambu-
lance services. 
(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Health and Human Services. 
(5) STATE.—The term ‘‘State’’ means the 50 
States and the District of Columbia.
677
SEC. 611. INCREASE IN APPROPRIATION TO THE HEALTH 
CARE FRAUD AND ABUSE CONTROL AC-
COUNT. 
Section 1817(k)(3)(A) (42 U.S.C. 1395i(k)(3)(A)) is 
amended—
(1) in clause (i)—
(A) in subclause (II), by striking ‘‘and’’ at 
the end; and 
(B) by striking subclause (III), and insert-
ing the following new subclauses: 
‘‘(III) for fiscal year 2004, the 
limit for fiscal year 2003 increased by 
$10,000,000; 
‘‘(IV) for fiscal year 2005, the 
limit for fiscal year 2003 increased by 
$15,000,000;
‘‘(V) for fiscal year 2006, the 
limit for fiscal year 2003 increased by 
$25,000,000; and 
‘‘(VI) for each fiscal year after 
fiscal year 2006, the limit for fiscal 
year 2003.’’; and 
(2) in clause (ii)—
(A) in subclause (VI), by striking ‘‘and’’ at 
the end; 
(B) in subclause (VII)—
678
(i) by striking ‘‘each fiscal year after 
fiscal year 2002’’ and inserting ‘‘fiscal year 
2003’’; and 
(ii) by striking the period and insert-
ing a semicolon; and 
(3) by adding at the end the following: 
‘‘(VIII) for fiscal year 2004, 
$170,000,000; 
‘‘(IX) 
for 
fiscal 
year 
2005, 
$175,000,000; 
‘‘(X) 
for 
fiscal 
year 
2006, 
$185,000,000; and 
‘‘(XI) for each fiscal year after 
fiscal year 2006, not less than 
$150,000,000 and not more than 
$160,000,000.’’. 
SEC. 612. INCREASE IN CIVIL PENALTIES UNDER THE 
FALSE CLAIMS ACT. 
(a) IN GENERAL.—Section 3729(a) of title 31, 
United States Code, is amended—
(1) 
by 
striking 
‘‘$5,000’’ 
and 
inserting 
‘‘$7,500’’; and 
(2) by striking ‘‘$10,000’’ and inserting 
‘‘$15,000’’.
679
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to violations occurring on or 
after January 1, 2004. 
SEC. 613. INCREASE IN CIVIL MONETARY PENALTIES 
UNDER THE SOCIAL SECURITY ACT. 
(a) IN GENERAL.—Section 1128A(a) (42 U.S.C. 
1320a–7a(a)), in the matter following paragraph (7), is 
amended—
(1) by striking ‘‘$10,000’’ each place it appears 
and inserting ‘‘$12,500’’; 
(2) by striking ‘‘$15,000’’ and inserting 
‘‘$18,750’’; and 
(3) 
striking 
‘‘$50,000’’ 
and 
inserting 
‘‘$62,500’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to violations occurring on or 
after January 1, 2004. 
SEC. 614. EXTENSION OF CUSTOMS USER FEES. 
Section 13031(j)(3) of the Consolidated Omnibus 
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) 
is amended by striking ‘‘September 30, 2003’’ and insert-
ing ‘‘September 30, 2013’’.
680
TITLE VII—ACCESS TO AFFORD-
ABLE PHARMACEUTICALS 
SEC. 701. SHORT TITLE. 
This title may be cited as the ‘‘Greater Access to Af-
fordable Pharmaceuticals Act’’. 
SEC. 702. 30-MONTH STAY-OF-EFFECTIVENESS PERIOD. 
(a) ABBREVIATED NEW DRUG APPLICATIONS.—Sec-
tion 505(j) of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 355(j)) is amended— 
(1) in paragraph (2), by striking subparagraph 
(B) and inserting the following: 
‘‘(B) NOTICE
OF
OPINION
THAT
PATENT
IS
NOT 
VALID OR WILL NOT BE INFRINGED.—
‘‘(i) AGREEMENT TO GIVE NOTICE.—An appli-
cant that makes a certification described in subpara-
graph (A)(vii)(IV) shall include in the application a 
statement that the applicant will give notice as re-
quired by this subparagraph. 
‘‘(ii) TIMING OF NOTICE.—An applicant that 
makes a certification described in subparagraph 
(A)(vii)(IV) shall give notice as required under this 
subparagraph—
‘‘(I) if the certification is in the applica-
tion, not later than 20 days after the date of 
the postmark on the notice with which the Sec-
681
retary informs the applicant that the applica-
tion has been filed; or
‘‘(II) if the certification is in an amend-
ment or supplement to the application, at the 
time at which the applicant submits the amend-
ment or supplement, regardless of whether the 
applicant has already given notice with respect 
to another such certification contained in the 
application or in an amendment or supplement 
to the application. 
‘‘(iii) RECIPIENTS
OF
NOTICE.—An applicant 
required under this subparagraph to give notice shall 
give notice to—
‘‘(I) each owner of the patent that is the 
subject of the certification (or a representative 
of the owner designated to receive such a no-
tice); and 
‘‘(II) the holder of the approved applica-
tion under subsection (b) for the drug that is 
claimed by the patent or a use of which is 
claimed by the patent (or a representative of 
the holder designated to receive such a notice). 
‘‘(iv) CONTENTS OF NOTICE.—A notice required 
under this subparagraph shall—
682
‘‘(I) state that an application that contains 
data from bioavailability or bioequivalence stud-
ies has been submitted under this subsection for 
the drug with respect to which the certification 
is made to obtain approval to engage in the 
commercial manufacture, use, or sale of the 
drug before the expiration of the patent re-
ferred to in the certification; and 
‘‘(II) include a detailed statement of the 
factual and legal basis of the opinion of the ap-
plicant that the patent is not valid or will not 
be infringed.’’; and 
(2) in paragraph (5)—
(A) in subparagraph (B)—
(i) by striking ‘‘under the following’’ 
and inserting ‘‘by applying the following to 
each certification made under paragraph 
(2)(A)(vii)’’; and 
(ii) in clause (iii)—
(I) in the first sentence, by strik-
ing ‘‘unless’’ and all that follows and 
inserting ‘‘unless, before the expira-
tion of 45 days after the date on 
which the notice described in para-
graph (2)(B) is received, an action is
683
brought for infringement of the patent 
that is the subject of the certification 
and for which information was sub-
mitted to the Secretary under sub-
section (b)(1) or (c)(2) before the date 
on which the application (excluding an 
amendment or supplement to the ap-
plication), which the Secretary later 
determines is substantially complete, 
was submitted.’’; and 
(II) in the second sentence—
(aa) by striking subclause 
(I) and inserting the following: 
‘‘(I) if before the expiration of such period 
the district court decides that the patent is in-
valid or not infringed (including any substantive 
determination that there is no cause of action 
for patent infringement or invalidity), the ap-
proval shall be made effective on—
‘‘(aa) the date on which the court en-
ters judgment reflecting the decision; or 
‘‘(bb) the date of a settlement order 
or consent decree signed and entered by 
the court stating that the patent that is
684
the subject of the certification is invalid or 
not infringed;’’; 
(bb) by striking subclause 
(II) and inserting the following: 
‘‘(II) if before the expiration of such period 
the district court decides that the patent has 
been infringed—
‘‘(aa) if the judgment of the district 
court is appealed, the approval shall be 
made effective on—
‘‘(AA) the date on which the 
court of appeals decides that the pat-
ent is invalid or not infringed (includ-
ing any substantive determination 
that there is no cause of action for 
patent infringement or invalidity); or 
‘‘(BB) the date of a settlement 
order or consent decree signed and 
entered by the court of appeals stat-
ing that the patent that is the subject 
of the certification is invalid or not in-
fringed; or 
‘‘(bb) if the judgment of the district 
court is not appealed or is affirmed, the 
approval shall be made effective on the
685
date specified by the district court in a 
court order under section 271(e)(4)(A) of 
title 35, United States Code;’’; 
(cc) in subclause (III), by 
striking ‘‘on the date of such 
court decision.’’ and inserting ‘‘as 
provided in subclause (I); or’’; 
and 
(dd) by inserting after sub-
clause (III) the following: 
‘‘(IV) if before the expiration of such pe-
riod the court grants a preliminary injunction 
prohibiting the applicant from engaging in the 
commercial manufacture or sale of the drug 
until the court decides the issues of patent va-
lidity and infringement and if the court decides 
that such patent has been infringed, the ap-
proval shall be made effective as provided in 
subclause (II).’’; 
(B) by redesignating subparagraphs (C) 
and (D) as subparagraphs (E) and (F), respec-
tively; and 
(C) by inserting after subparagraph (B) 
the following:
686
‘‘(C) CIVIL
ACTION
TO
OBTAIN
PATENT 
CERTAINTY.—
‘‘(i) DECLARATORY
JUDGMENT
AB-
SENT
INFRINGEMENT
ACTION.—If 
an 
owner of the patent or the holder of the 
approved application under subsection (b) 
for the drug that is claimed by the patent 
or a use of which is claimed by the patent
does not bring a civil action against the 
applicant for infringement of the patent on 
or before the date that is 45 days after the 
date on which the notice given under para-
graph (2)(B) was received, the applicant 
may bring a civil action against the owner 
or holder (but not against any owner or 
holder that has brought such a civil action 
against that applicant, unless that civil ac-
tion was dismissed without prejudice) for 
a declaratory judgment under section 2201 
of title 28, United States Code, that the 
patent is invalid or will not be infringed 
by the drug for which the applicant seeks 
approval. 
‘‘(ii) COUNTERCLAIM
TO
INFRINGE-
MENT ACTION.—
687
‘‘(I) IN GENERAL.—If an owner 
of the patent or the holder of the ap-
proved application under subsection 
(b) for the drug that is claimed by the 
patent or a use of which is claimed by 
the patent brings a patent infringe-
ment action against the applicant, the 
applicant may assert a counterclaim 
seeking an order requiring the holder 
to correct or delete the patent infor-
mation submitted by the holder under 
subsection (b) or (c) on the ground 
that the patent does not claim ei-
ther—
‘‘(aa) the drug for which the 
application was approved; or 
‘‘(bb) an approved method 
of using the drug. 
‘‘(II) NO
INDEPENDENT
CAUSE 
OF ACTION.—Subclause (I) does not 
authorize the assertion of a claim de-
scribed in subclause (I) in any civil 
action or proceeding other than a 
counterclaim described in subclause 
(I).
688
‘‘(iii) NO
DAMAGES.—An applicant 
shall not be entitled to damages in a civil 
action under subparagraph (i) or a coun-
terclaim under subparagraph (ii).’’. 
(b) APPLICATIONS GENERALLY.—Section 505 of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) 
is amended—
(1) in subsection (b), by striking paragraph (3) 
and inserting the following: 
‘‘(3) NOTICE
OF
OPINION
THAT
PATENT
IS
NOT 
VALID OR WILL NOT BE INFRINGED.—
‘‘(A) AGREEMENT TO GIVE NOTICE.—An appli-
cant that makes a certification described in para-
graph (2)(A)(iv) shall include in the application a 
statement that the applicant will give notice as re-
quired by this paragraph. 
‘‘(B) TIMING OF NOTICE.—An applicant that 
makes a certification described in paragraph 
(2)(A)(iv) shall give notice as required under this 
paragraph—
‘‘(i) if the certification is in the applica-
tion, not later than 20 days after the date of 
the postmark on the notice with which the Sec-
retary informs the applicant that the applica-
tion has been filed; or
689
‘‘(ii) if the certification is in an amend-
ment or supplement to the application, at the 
time at which the applicant submits the amend-
ment or supplement, regardless of whether the 
applicant has already given notice with respect 
to another such certification contained in the 
application or in an amendment or supplement 
to the application. 
‘‘(C) RECIPIENTS
OF
NOTICE.—An applicant 
required under this paragraph to give notice shall 
give notice to—
‘‘(i) each owner of the patent that is the 
subject of the certification (or a representative 
of the owner designated to receive such a no-
tice); and 
‘‘(ii) the holder of the approved application 
under this subsection for the drug that is 
claimed by the patent or a use of which is 
claimed by the patent (or a representative of 
the holder designated to receive such a notice).
‘‘(D) CONTENTS
OF
NOTICE.—A notice re-
quired under this paragraph shall—
‘‘(i) state that an application that contains 
data from bioavailability or bioequivalence stud-
ies has been submitted under this subsection for
690
the drug with respect to which the certification 
is made to obtain approval to engage in the 
commercial manufacture, use, or sale of the 
drug before the expiration of the patent re-
ferred to in the certification; and 
‘‘(ii) include a detailed statement of the 
factual and legal basis of the opinion of the ap-
plicant that the patent is not valid or will not 
be infringed.’’; and 
(2) in subsection (c)(3)—
(A) in the first sentence, by striking 
‘‘under the following’’ and inserting ‘‘by apply-
ing the following to each certification made 
under subsection (b)(2)(A)(iv)’’; 
(B) in subparagraph (C)—
(i) in the first sentence, by striking 
‘‘unless’’ and all that follows and inserting 
‘‘unless, before the expiration of 45 days 
after the date on which the notice de-
scribed in subsection (b)(3) is received, an 
action is brought for infringement of the 
patent that is the subject of the certifi-
cation and for which information was sub-
mitted to the Secretary under paragraph 
(2) or subsection (b)(1) before the date on
691
which the application (excluding an amend-
ment or supplement to the application) was 
submitted.’’; 
(ii) in the second sentence—
(I) 
by 
striking 
‘‘paragraph 
(3)(B)’’ and inserting ‘‘subsection 
(b)(3)’’; 
(II) by striking clause (i) and in-
serting the following: 
‘‘(i) if before the expiration of such period 
the district court decides that the patent is in-
valid or not infringed (including any substantive 
determination that there is no cause of action 
for patent infringement or invalidity), the ap-
proval shall be made effective on—
‘‘(I) the date on which the court en-
ters judgment reflecting the decision; or 
‘‘(II) the date of a settlement order or 
consent decree signed and entered by the 
court stating that the patent that is the 
subject of the certification is invalid or not 
infringed;’’; 
(III) by striking clause (ii) and 
inserting the following:
692
‘‘(ii) if before the expiration of such period 
the district court decides that the patent has 
been infringed—
‘‘(I) if the judgment of the district 
court is appealed, the approval shall be 
made effective on—
‘‘(aa) the date on which the court 
of appeals decides that the patent is 
invalid or not infringed (including any 
substantive determination that there 
is no cause of action for patent in-
fringement or invalidity); or 
‘‘(bb) the date of a settlement 
order or consent decree signed and 
entered by the court of appeals stat-
ing that the patent that is the subject 
of the certification is invalid or not in-
fringed; or 
‘‘(II) if the judgment of the district 
court is not appealed or is affirmed, the 
approval shall be made effective on the 
date specified by the district court in a 
court order under section 271(e)(4)(A) of 
title 35, United States Code;’’;
693
(IV) in clause (iii), by striking 
‘‘on the date of such court decision.’’ 
and inserting ‘‘as provided in clause 
(i); or’’; and 
(V) by inserting after clause (iii), 
the following: 
‘‘(iv) if before the expiration of such period 
the court grants a preliminary injunction pro-
hibiting the applicant from engaging in the 
commercial manufacture or sale of the drug 
until the court decides the issues of patent va-
lidity and infringement and if the court decides 
that such patent has been infringed, the ap-
proval shall be made effective as provided in 
clause (ii).’’; and 
(iii) in the third sentence, by striking 
‘‘paragraph (3)(B)’’ and inserting ‘‘sub-
section (b)(3)’’; 
(C) by redesignating subparagraph (D) as 
subparagraph (E); and 
(D) by inserting after subparagraph (C) 
the following: 
‘‘(D) CIVIL
ACTION
TO
OBTAIN
PATENT 
CERTAINTY.—
694
‘‘(i) DECLARATORY
JUDGMENT
AB-
SENT
INFRINGEMENT
ACTION.—If 
an 
owner of the patent or the holder of the 
approved application under subsection (b) 
for the drug that is claimed by the patent 
or a use of which is claimed by the patent 
does not bring a civil action against the 
applicant for infringement of the patent on 
or before the date that is 45 days after the 
date on which the notice given under sub-
section (b)(3) was received, the applicant 
may bring a civil action against the owner 
or holder (but not against any owner or 
holder that has brought such a civil action 
against that applicant, unless that civil ac-
tion was dismissed without prejudice) for a 
declaratory judgment under section 2201 
of title 28, United States Code, that the 
patent is invalid or will not be infringed by 
the drug for which the applicant seeks ap-
proval. 
‘‘(ii) COUNTERCLAIM
TO
INFRINGE-
MENT ACTION.—
‘‘(I) IN GENERAL.—If an owner 
of the patent or the holder of the ap-
695
proved application under subsection 
(b) for the drug that is claimed by the 
patent or a use of which is claimed by 
the patent brings a patent infringe-
ment action against the applicant, the 
applicant may assert a counterclaim 
seeking an order requiring the holder 
to correct or delete the patent infor-
mation submitted by the holder under 
subsection (b) or this subsection on 
the ground that the patent does not 
claim either—
‘‘(aa) the drug for which the 
application was approved; or 
‘‘(bb) an approved method 
of using the drug. 
‘‘(II) NO
INDEPENDENT
CAUSE 
OF ACTION.—Subclause (I) does not 
authorize the assertion of a claim de-
scribed in subclause (I) in any civil 
action or proceeding other than a 
counterclaim described in subclause 
(I). 
‘‘(iii) NO
DAMAGES.—An applicant 
shall not be entitled to damages in a civil
696
action under clause (i) or a counterclaim 
under clause (ii).’’. 
(c) INFRINGEMENT ACTIONS.—Section 271(e) of title 
35, United States Code, is amended by adding at the end 
the following: 
‘‘(5) The filing of an application described in 
paragraph (2) that includes a certification under 
subsection (b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) of sec-
tion 505 of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 355), and the failure of the owner 
of the patent to bring an action for infringement of 
a patent that is the subject of the certification be-
fore the expiration of 45 days after the date on 
which the notice given under subsection (b)(3) or 
(j)(2)(B) of that section is received, shall establish 
an actual controversy between the applicant and the 
patent owner sufficient to confer subject matter ju-
risdiction in the courts of the United States in any 
action brought by the applicant under section 2201 
of title 28 for a declaratory judgment that any pat-
ent that is the subject of the certification is invalid 
or not infringed.’’. 
(d) APPLICABILITY.—
(1) IN GENERAL.—Except as provided in para-
graphs (2) and (3), the amendments made by sub-
697
sections (a), (b), and (c) apply to any proceeding 
under section 505 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 355) that is pending on 
or after the date of enactment of this Act regardless 
of the date on which the proceeding was commenced 
or is commenced. 
(2) NOTICE OF OPINION THAT PATENT IS IN-
VALID OR WILL NOT BE INFRINGED.—The amend-
ments made by subsections (a)(1) and (b)(1) apply 
with respect to any certification under subsection 
(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) of section 505 of 
the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 355) after the date of enactment of this Act 
in an application filed under subsection (b)(2) or (j) 
of that section or in an amendment or supplement 
to an application filed under subsection (b)(2) or (j) 
of that section. 
(3) EFFECTIVE
DATE
OF
APPROVAL.—The 
amendments made by subsections (a)(2)(A)(ii)(I) 
and (b)(2)(B)(i) apply with respect to any patent in-
formation submitted under subsection (b)(1) or 
(c)(2) of section 505 of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 355) made after the date 
of enactment of this Act.
698
SEC. 703. FORFEITURE OF 180-DAY EXCLUSIVITY PERIOD. 
(a) IN GENERAL.—Section 505(j)(5) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)(5)) (as 
amended by section ll02) is amended—
(1) in subparagraph (B), by striking clause (iv) 
and inserting the following: 
‘‘(iv) 180-DAY EXCLUSIVITY PERIOD.—
‘‘(I) DEFINITIONS.—In this paragraph: 
‘‘(aa) 
180-DAY
EXCLUSIVITY
PE-
RIOD.—The term ‘180-day exclusivity pe-
riod’ means the 180-day period ending on 
the day before the date on which an appli-
cation submitted by an applicant other 
than a first applicant could become effec-
tive under this clause. 
‘‘(bb) FIRST
APPLICANT.—The term 
‘first applicant’ means an applicant that, 
on the first day on which a substantially 
complete application containing a certifi-
cation 
described 
in 
paragraph 
(2)(A)(vii)(IV) is submitted for approval of 
a drug, submits a substantially complete 
application containing a certification de-
scribed in paragraph (2)(A)(vii)(IV) for 
the drug.
699
‘‘(cc) SUBSTANTIALLY COMPLETE AP-
PLICATION.—The term ‘substantially com-
plete application’ means an application 
under this subsection that on its face is 
sufficiently complete to permit a sub-
stantive review and contains all the infor-
mation required by paragraph (2)(A). 
‘‘(dd) TENTATIVE APPROVAL.—
‘‘(AA) IN GENERAL.—The term 
‘tentative approval’ means notification 
to an applicant by the Secretary that 
an application under this subsection 
meets the requirements of paragraph 
(2)(A), but cannot receive effective 
approval because the application does 
not meet the requirements of this sub-
paragraph, there is a period of exclu-
sivity for the listed drug under sub-
paragraph (E) or section 505A, or 
there is a 7-year period of exclusivity 
for the listed drug under section 527. 
‘‘(BB) 
LIMITATION.—A 
drug 
that is granted tentative approval by 
the Secretary is not an approved drug 
and shall not have an effective ap-
700
proval until the Secretary issues an 
approval after any necessary addi-
tional review of the application. 
‘‘(II) EFFECTIVENESS OF APPLICATION.—
Subject to subparagraph (D), if the application 
contains a certification described in paragraph 
(2)(A)(vii)(IV) and is for a drug for which a 
first applicant has submitted an application 
containing such a certification, the application 
shall be made effective on the date that is 180 
days after the date of the first commercial mar-
keting of the drug (including the commercial 
marketing of the listed drug) by any first appli-
cant.’’; and 
(2) by inserting after subparagraph (C) the fol-
lowing: 
‘‘(D) FORFEITURE
OF
180-DAY
EXCLU-
SIVITY PERIOD.—
‘‘(i) DEFINITION
OF
FORFEITURE 
EVENT.—In this subparagraph, the term 
‘forfeiture event’, with respect to an appli-
cation under this subsection, means the oc-
currence of any of the following:
701
‘‘(I) FAILURE TO MARKET.—The 
first applicant fails to market the 
drug by the later of—
‘‘(aa) the earlier of the date 
that is— 
‘‘(AA) 75 days after the 
date on which the approval 
of the application of the first 
applicant is made effective 
under subparagraph (B)(iii); 
or 
‘‘(BB) 30 months after 
the date of submission of 
the application of the first 
applicant; or 
‘‘(bb) with respect to the 
first applicant or any other appli-
cant (which other applicant has 
received tentative approval), the 
date that is 75 days after the 
date as of which, as to each of 
the patents with respect to which 
the first applicant submitted a 
certification qualifying the first 
applicant for the 180-day exclu-
702
sivity period under subparagraph 
(B)(iv), at least 1 of the fol-
lowing has occurred: 
‘‘(AA) In an infringe-
ment action brought against 
that applicant with respect 
to the patent or in a declar-
atory 
judgment 
action 
brought by that applicant 
with respect to the patent, a 
court enters a final decision 
from which no appeal (other 
than a petition to the Su-
preme Court for a writ of 
certiorari) has been or can 
be taken that the patent is 
invalid or not infringed. 
‘‘(BB) In an infringe-
ment action or a declaratory 
judgment action described in 
subitem (AA), a court signs 
a settlement order or con-
sent decree that enters a 
final judgment that includes
703
a finding that the patent is 
invalid or not infringed. 
‘‘(CC) The patent ex-
pires. 
‘‘(DD) The patent is 
withdrawn by the holder of 
the 
application 
approved 
under subsection (b). 
‘‘(II) WITHDRAWAL OF APPLICA-
TION.—The first applicant withdraws 
the application or the Secretary con-
siders the application to have been 
withdrawn as a result of a determina-
tion by the Secretary that the applica-
tion does not meet the requirements 
for approval under paragraph (4). 
‘‘(III) AMENDMENT OF CERTIFI-
CATION.—The first applicant amends 
or withdraws the certification for all 
of the patents with respect to which 
that applicant submitted a certifi-
cation qualifying the applicant for the 
180-day exclusivity period. 
‘‘(IV) FAILURE TO OBTAIN TEN-
TATIVE
APPROVAL.—The first appli-
704
cant fails to obtain tentative approval 
of the application within 30 months 
after the date on which the applica-
tion is filed, unless the failure is 
caused by a change in or a review of 
the requirements for approval of the 
application imposed after the date on 
which the application is filed. 
‘‘(V) 
AGREEMENT
WITH
AN-
OTHER APPLICANT, THE LISTED DRUG 
APPLICATION HOLDER, OR A PATENT 
OWNER.—The first applicant enters 
into an agreement with another appli-
cant under this subsection for the 
drug, the holder of the application for 
the listed drug, or an owner of the 
patent that is the subject of the cer-
tification 
under 
paragraph 
(2)(A)(vii)(IV), the Federal Trade 
Commission or the Attorney General 
files a complaint, and there is a final 
decision of the Federal Trade Com-
mission or the court with regard to 
the complaint from which no appeal 
(other than a petition to the Supreme
705
Court for a writ of certiorari) has 
been or can be taken that the agree-
ment has violated the antitrust laws 
(as defined in section 1 of the Clayton 
Act (15 U.S.C. 12), except that the 
term includes section 5 of the Federal 
Trade Commission Act (15 U.S.C. 45) 
to the extent that that section applies 
to unfair methods of competition). 
‘‘(VI) EXPIRATION OF ALL PAT-
ENTS.—All of the patents as to which 
the applicant submitted a certification 
qualifying it for the 180-day exclu-
sivity period have expired. 
‘‘(ii) FORFEITURE.—The 180-day ex-
clusivity period described in subparagraph 
(B)(iv) shall be forfeited by a first appli-
cant if a forfeiture event occurs with re-
spect to that first applicant. 
‘‘(iii) SUBSEQUENT
APPLICANT.—If 
all first applicants forfeit the 180-day ex-
clusivity period under clause (ii)—
‘‘(I) approval of any application 
containing a certification described in 
paragraph (2)(A)(vii)(IV) shall be
706
made effective in accordance with sub-
paragraph (B)(iii); and 
‘‘(II) no applicant shall be eligi-
ble for a 180-day exclusivity period.’’. 
(b) EFFECTIVE DATE.—
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendment made by subsection (a) 
shall be effective only with respect to an application 
filed under section 505(j) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 355(j)) after the 
date of enactment of this Act for a listed drug for 
which 
no 
certification 
under 
section 
505(j)(2)(A)(vii)(IV) of that Act was made before 
the date of enactment of this Act. 
(2) COLLUSIVE AGREEMENTS.—If a forfeiture 
event described in section 505(j)(5)(D)(i)(V) of that 
Act occurs in the case of an applicant, the applicant 
shall forfeit the 180-day period under section 
505(j)(5)(B)(iv) of that Act without regard to when 
the 
first 
certification 
under 
section 
505(j)(2)(A)(vii)(IV) of that Act for the listed drug 
was made. 
(3) DECISION OF A COURT WHEN THE 180-DAY 
EXCLUSIVITY PERIOD HAS NOT BEEN TRIGGERED.—
With respect to an application filed before, on, or
707
after the date of enactment of this Act for a listed 
drug for which a certification under section 
505(j)(2)(A)(vii)(IV) of that Act was made before 
the date of enactment of this Act and for which nei-
ther of the events described in subclause (I) or (II) 
of section 505(j)(5)(B)(iv) of that Act (as in effect 
on the day before the date of enactment of this Act) 
has occurred on or before the date of enactment of 
this Act, the term ‘‘decision of a court’’ as used in 
clause (iv) of section 505(j)(5)(B) of that Act means 
a final decision of a court from which no appeal 
(other than a petition to the Supreme Court for a 
writ of certiorari) has been or can be taken. 
SEC. 704. BIOAVAILABILITY AND BIOEQUIVALENCE. 
(a) IN GENERAL.—Section 505(j)(8) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)(8)) is 
amended—
(1) by striking subparagraph (A) and inserting 
the following: 
‘‘(A)(i) The term ‘bioavailability’ means the 
rate and extent to which the active ingredient or 
therapeutic ingredient is absorbed from a drug and 
becomes available at the site of drug action. 
‘‘(ii) For a drug that is not intended to be ab-
sorbed into the bloodstream, the Secretary may as-
708
sess bioavailability by scientifically valid measure-
ments intended to reflect the rate and extent to 
which the active ingredient or therapeutic ingredient 
becomes available at the site of drug action.’’; and 
(2) by adding at the end the following: 
‘‘(C) For a drug that is not intended to be ab-
sorbed into the bloodstream, the Secretary may es-
tablish alternative, scientifically valid methods to 
show bioequivalence if the alternative methods are 
expected to detect a significant difference between 
the drug and the listed drug in safety and thera-
peutic effect.’’. 
(b) EFFECT
OF
AMENDMENT.—The amendment 
made by subsection (a) does not alter the standards for 
approval of drugs under section 505(j) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)). 
SEC. 705. REMEDIES FOR INFRINGEMENT. 
Section 287 of title 35, United States Code, is 
amended by adding at the end the following: 
‘‘(d) CONSIDERATION.—In making a determination 
with respect to remedy brought for infringement of a pat-
ent that claims a drug or a method of using a drug, the 
court shall consider whether information on the patent 
was filed as required under 21 U.S.C. 355 (b) or (c), and, 
if such information was required to be filed but was not,
709
the court may refuse to award treble damages under sec-
tion 284.’’. 
SEC. 706. CONFORMING AMENDMENTS. 
Section 505A of the Federal Food, Drug, and Cos-
metic Act (21 U.S.C. 355a) is amended—
(1) in subsections (b)(1)(A)(i) and (c)(1)(A)(i), 
by striking ‘‘(j)(5)(D)(ii)’’ each place it appears and 
inserting ‘‘(j)(5)(F)(ii)’’;
(2) 
in 
subsections 
(b)(1)(A)(ii) 
and 
(c)(1)(A)(ii), by striking ‘‘(j)(5)(D)’’ each place it 
appears and inserting ‘‘(j)(5)(F)’’; and 
(3) in subsections (e) and (l), by striking 
‘‘505(j)(5)(D)’’ each place it appears and inserting 
‘‘505(j)(5)(F)’’. 
TITLE VIII—IMPORTATION OF 
PRESCRIPTION DRUGS 
SEC. 801. IMPORTATION OF PRESCRIPTION DRUGS. 
(a) IN GENERAL.—Chapter VIII of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 381 et seq.) 
is amended by striking section 804 and inserting the fol-
lowing: 
‘‘SEC. 804. IMPORTATION OF PRESCRIPTION DRUGS. 
‘‘(a) DEFINITIONS.—In this section: 
‘‘(1) IMPORTER.—The term ‘importer’ means a 
pharmacist or wholesaler.
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‘‘(2) PHARMACIST.—The term ‘pharmacist’ 
means a person licensed by a State to practice phar-
macy, including the dispensing and selling of pre-
scription drugs. 
‘‘(3) PRESCRIPTION
DRUG.—The term ‘pre-
scription drug’ means a drug subject to section 
503(b), other than—
‘‘(A) a controlled substance (as defined in 
section 102 of the Controlled Substances Act 
(21 U.S.C. 802)); 
‘‘(B) a biological product (as defined in 
section 351 of the Public Health Service Act 
(42 U.S.C. 262)); 
‘‘(C) an infused drug (including a peri-
toneal dialysis solution); 
‘‘(D) an intravenously injected drug; or 
‘‘(E) a drug that is inhaled during surgery. 
‘‘(4) QUALIFYING
LABORATORY.—The term 
‘qualifying laboratory’ means a laboratory in the 
United States that has been approved by the Sec-
retary for the purposes of this section. 
‘‘(5) WHOLESALER.—
‘‘(A) IN GENERAL.—The term ‘wholesaler’ 
means a person licensed as a wholesaler or dis-
711
tributor of prescription drugs in the United 
States under section 503(e)(2)(A). 
‘‘(B) EXCLUSION.—The term ‘wholesaler’ 
does not include a person authorized to import 
drugs under section 801(d)(1). 
‘‘(b) REGULATIONS.—The Secretary, after consulta-
tion with the United States Trade Representative and the 
Commissioner of Customs, shall promulgate regulations 
permitting pharmacists and wholesalers to import pre-
scription drugs from Canada into the United States. 
‘‘(c) LIMITATION.—The regulations under subsection 
(b) shall—
‘‘(1) require that safeguards be in place to en-
sure that each prescription drug imported under the 
regulations complies with section 505 (including 
with respect to being safe and effective for the in-
tended use of the prescription drug), with sections 
501 and 502, and with other applicable require-
ments of this Act; 
‘‘(2) require that an importer of a prescription 
drug under the regulations comply with subsections 
(d)(1) and (e); and 
‘‘(3) contain any additional provisions deter-
mined by the Secretary to be appropriate as a safe-
712
guard to protect the public health or as a means to 
facilitate the importation of prescription drugs. 
‘‘(d) INFORMATION AND RECORDS.—
‘‘(1) IN GENERAL.—The regulations under sub-
section (b) shall require an importer of a prescrip-
tion drug under subsection (b) to submit to the Sec-
retary the following information and documentation: 
‘‘(A) The name and quantity of the active 
ingredient of the prescription drug. 
‘‘(B) A description of the dosage form of 
the prescription drug. 
‘‘(C) The date on which the prescription 
drug is shipped.
‘‘(D) The quantity of the prescription drug 
that is shipped. 
‘‘(E) The point of origin and destination of 
the prescription drug. 
‘‘(F) The price paid by the importer for 
the prescription drug. 
‘‘(G) Documentation from the foreign sell-
er specifying—
‘‘(i) the original source of the pre-
scription drug; and
713
‘‘(ii) the quantity of each lot of the 
prescription drug originally received by the 
seller from that source. 
‘‘(H) The lot or control number assigned 
to the prescription drug by the manufacturer of 
the prescription drug. 
‘‘(I) The name, address, telephone number, 
and professional license number (if any) of the 
importer. 
‘‘(J)(i) In the case of a prescription drug 
that is shipped directly from the first foreign 
recipient of the prescription drug from the 
manufacturer: 
‘‘(I) 
Documentation 
demonstrating 
that the prescription drug was received by 
the recipient from the manufacturer and 
subsequently shipped by the first foreign 
recipient to the importer. 
‘‘(II) Documentation of the quantity 
of each lot of the prescription drug re-
ceived by the first foreign recipient dem-
onstrating that the quantity being im-
ported into the United States is not more 
than the quantity that was received by the 
first foreign recipient.
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‘‘(III)(aa) In the case of an initial im-
ported 
shipment, 
documentation 
dem-
onstrating that each batch of the prescrip-
tion drug in the shipment was statistically 
sampled and tested for authenticity and 
degradation. 
‘‘(bb) In the case of any subsequent 
shipment, documentation demonstrating 
that a statistically valid sample of the ship-
ment was tested for authenticity and deg-
radation. 
‘‘(ii) In the case of a prescription drug 
that is not shipped directly from the first for-
eign recipient of the prescription drug from the 
manufacturer, 
documentation 
demonstrating 
that each batch in each shipment offered for 
importation into the United States was statis-
tically sampled and tested for authenticity and 
degradation. 
‘‘(K) Certification from the importer or 
manufacturer of the prescription drug that the 
prescription drug—
‘‘(i) is approved for marketing in the 
United States; and
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‘‘(ii) meets all labeling requirements 
under this Act. 
‘‘(L) Laboratory records, including com-
plete data derived from all tests necessary to 
ensure that the prescription drug is in compli-
ance with established specifications and stand-
ards. 
‘‘(M) Documentation demonstrating that 
the testing required by subparagraphs (J) and 
(L) was conducted at a qualifying laboratory. 
‘‘(N) Any other information that the Sec-
retary determines is necessary to ensure the 
protection of the public health. 
‘‘(2) MAINTENANCE BY THE SECRETARY.—The 
Secretary shall maintain information and docu-
mentation submitted under paragraph (1) for such 
period of time as the Secretary determines to be nec-
essary. 
‘‘(e) TESTING.—The regulations under subsection (b) 
shall require—
‘‘(1) that testing described in subparagraphs 
(J) and (L) of subsection (d)(1) be conducted by the 
importer or by the manufacturer of the prescription 
drug at a qualified laboratory;