Act (21 U.S.C. 351) is amended by adding at 
the end the following: 
‘‘(j) If it is a laboratory-developed genetic test de-
scribed in section 520(o)(4) and the manufacturer of the 
test fails to submit information with respect to the test 
as required by such section.’’. 
(2) COMPARATIVE
ANALYSIS.—To inform im-
plementation of the registry on laboratory-developed 
genetic tests under section 520(o) of the Federal 
Food, Drug, and Cosmetic Act, as added by para-
graph (1), the Secretary shall undertake a compara-
tive analysis of laboratory review requirements under 
CLIA and those of the Food and Drug Administra-
tion to— 
(A) assess and reduce unnecessary dif-
ferences in such requirements; 
(B) eliminate redundancies and decrease 
the burden of review, as practicable; and 
(C) specify which elements of the test con-
stitute a device that may be regulated by the 
Food and Drug Administration and which ele-
ments comprise a service that may be regulated 
under CLIA. 
(3) REGULATIONS.—Not later than 18 months 
after the date of the enactment of this Act, the Sec-
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retary shall promulgate regulations to implement the 
registry on laboratory-developed genetic tests under 
section 520(o) of the Federal Food, Drug, and Cos-
metic Act, as added by paragraph (1). 
(4) EFFECTIVE DATE OF SUBMISSION REQUIRE-
MENTS.—The Secretary may not require a labora-
tory to submit information under section 520(o) of 
the Federal Food, Drug and Cosmetic Act, as added 
by paragraph (1), until the date that is 180 days 
after the regulations promulgated pursuant to para-
graph (3) take effect. 
(5) ADVERSE EVENTS.—The Secretary, acting 
through the Commissioner of Food and Drugs and 
the Administrator of the Centers for Medicare & 
Medicaid Services, shall— 
(A) facilitate the use of genetic and 
genomic approaches, as feasible, to assess risk 
for, and reduce incidence of, adverse drug reac-
tions; 
(B) develop or expand adverse event re-
porting systems to encompass reports of ad-
verse events resulting from genetic testing; and 
(C) respond appropriately to any adverse 
events resulting from such testing. 
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(b) NATIONAL ACADEMY OF SCIENCES STUDY.—Not 
later than 180 days after the date of the enactment of 
this Act, the Secretary shall enter into a contract with 
the National Research Council of the National Academy 
of Sciences to study and recommend appropriate incen-
tives to encourage— 
(1) codevelopment of companion diagnostic test-
ing by a drug sponsor; 
(2) development of companion diagnostic test-
ing for already-approved drugs by the drug sponsor; 
(3) companion diagnostic test development by 
device companies that are not affiliated with the 
drug sponsor; and 
(4) action on other issues determined appro-
priate by the Secretary. 
(c) FOOD AND DRUG ADMINISTRATION.— 
(1) ENCOURAGEMENT
OF
COMPANION
DIAG-
NOSTIC
TESTING.—The Secretary, acting through 
the Commissioner of Food and Drugs, may encour-
age the sponsor of a drug or biological product— 
(A) to codevelop a companion diagnostic 
test, after filing an investigational new drug ap-
plication or a new drug application to address 
significant safety concerns of the drug or bio-
logical product; 
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(B) to develop a companion diagnostic test 
if phase IV data demonstrate significant safety 
or effectiveness concerns with use of the drug 
or biological product; and 
(C) to relabel the drug or biological prod-
uct to require validated companion diagnostic 
testing when evidence of improved outcomes has 
been established in practice or if data dem-
onstrate significant safety concerns with use of 
such drug or biological product. 
(2) PHARMACOGENOMIC
DATA
SUBMISSION.— 
The Secretary, acting through the Commissioner of 
Food and Drugs, shall encourage and facilitate vol-
untary pharmacogenomic data submission from drug 
sponsors, which may include— 
(A) the development and dissemination of 
guidance on relevant policies, procedure and 
practice regarding such submission; 
(B) the provision of technical assistance; 
(C) the establishment of a mechanism to 
store, maintain, and analyze such data, in col-
laboration with the National Institutes of 
Health and the Centers for Disease Control and 
Prevention; 
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(D) determining when such data may be 
used to support an investigational new drug or 
a new drug application; 
(E) the conduct of a study of the use of 
genomic approaches to understand and reduce 
adverse drug reactions; and 
(F) other activities determined appropriate 
by the Commissioner. 
(3) TERMINATION
OF
CERTAIN
ADVERTISING 
CAMPAIGNS.—The Commissioner of Food and Drugs 
shall collaborate with the Federal Trade Commission 
to identify and terminate, pursuant to section 5 of 
the Federal Trade Commission Act (15 U.S.C. 45), 
advertising campaigns that make false, misleading, 
deceptive, or unfair claims about the benefits or 
risks of genetic tests. 
(d) CENTERS FOR MEDICARE & MEDICAID SERV-
ICES.—To foster adoption of genetic screening tools, the 
Administrator of the Centers for Medicare & Medicaid 
Services shall— 
(1) assess and update current procedure termi-
nology codes to encourage the rapid review and cov-
erage of novel tests through the creation of new 
Healthcare Common Procedures Coding System 
(‘‘HCPCS’’) codes and adoption of new current pro-
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cedural terminology (‘‘CPT’’) codes and without 
undue reliance on national coverage determinations; 
and 
(2) determine and implement fair and reason-
able coverage policies and reimbursement rates for 
medically necessary genetic and genomic treatments 
and services, including laboratory testing. 
(e) CENTERS FOR DISEASE CONTROL AND PREVEN-
TION.— 
(1) DIRECT-TO-CONSUMER
MARKETING.—Not 
later than 2 years after the date of the enactment 
of this Act, the Director of the Centers for Disease 
Control and Prevention (in this subsection referred 
to as the ‘‘Director’’), with respect to genetic tests 
for which consumers have direct access, shall— 
(A) conduct an analysis of the public 
health impact of direct-to-consumer marketing 
to the extent possible from available data 
sources; 
(B) analyze the validity of claims made in 
direct-to-consumer 
marketing 
to 
determine 
whether such claims are substantiated by com-
petent and reliable scientific evidence; and 
(C) make recommendations to the Sec-
retary regarding necessary interventions to pro-
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tect the public from potential harms of direct 
to-consumer marketing and access to genetic 
tests. 
(2) PUBLIC
AWARENESS.—The Director shall 
expand efforts to educate and increase awareness of 
the general public about genomics and its applica-
tions to improve health, prevent disease, and elimi-
nate health disparities. Such efforts shall include 
the— 
(A) ongoing collection of data on the 
awareness, knowledge, and use of genetic tests 
through public health surveillance systems, and 
analysis of the impact of such tests on popu-
lation health; and 
(B) integration of the use of validated ge-
netic and genomic tests in public health pro-
grams as appropriate. 
(f) AGENCY
FOR HEALTHCARE RESEARCH
AND 
QUALITY.—The Director of the Agency for Healthcare 
Research and Quality, after consultation with the IWG 
and other public and private organizations based in the 
United States and abroad, as appropriate, shall support 
the assessment of the clinical utility and cost-effectiveness 
of companion diagnostic tests that guide prescribing deci-
sions, through research that— 
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(1) develops standardized tools and methodolo-
gies to assess the clinical utility and cost-effective-
ness of such tests, as well as criteria for use; 
(2) establishes and validates drug dosing algo-
rithms for which such tests can improve outcomes, 
taking into consideration— 
(A) a reduction in toxicity, adverse events, 
and mortality; 
(B) improved clinical outcomes and quality 
of life, including decreased requirements for 
monitoring and laboratory testing; and 
(C) the impact on the direct and indirect 
costs of health care, which may include costs 
due to length of hospital stay, length of time to 
identify safe and effective dosing for patients, 
toxicity and adverse events, and other measures 
of health care utilization and outcomes; 
(3) supports and expedites the development of 
clinical decision tools for clinical use of genetic tests, 
as warranted; and 
(4) prioritizes the development of such tests for 
diseases and health conditions that have a signifi-
cant public health impact because of prevalence, risk 
of complications from treatment, and other factors 
determined appropriate by the Director. 
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(g) AUTHORIZATION OF APPROPRIATIONS.— 
(1) IN GENERAL.—To carry out subsections (a), 
(c), (d), and (f), there are authorized to be appro-
priated $30,000,000 for fiscal year 2009, and such 
sums as may be necessary for each of fiscal years 
2010 through 2014. 
(2) REGISTRY ON ANALYTICAL AND CLINICAL 
VALIDITY
OF
LABORATORY-DEVELOPED
GENETIC 
TESTS; ADVERSE EVENT REPORTING.—To carry out 
subsection (b), there are authorized to be appro-
priated $10,000,000 for fiscal year 2009, and such 
sums as may be necessary for each of fiscal years 
2010 through 2014. 
(3) CDC PUBLIC AWARENESS ACTIVITIES.—To 
carry out subsection (e), there are authorized to be 
appropriated $30,000,000 for fiscal year 2009, and 
such sums as may be necessary for each of fiscal 
years 2010 through 2014. 
SEC. 8. TAX CREDIT FOR RESEARCH AND DEVELOPMENT 
RELATED 
TO 
COMPANION 
DIAGNOSTIC 
TESTS. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new 
section: 
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‘‘SEC. 45Q. COMPANION DIAGNOSTIC TEST CREDIT. 
‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec-
tion 38, in the case of an eligible taxpayer, the companion 
diagnostic test credit for any taxable year is an amount 
equal to the qualified research expenses paid or incurred 
by the taxpayer during the taxable year in connection with 
the development of a qualified companion diagnostic test. 
‘‘(b) ELIGIBLE TAXPAYER.—For purposes of this 
section, the term ‘eligible taxpayer’ means a taxpayer who 
has been requested to develop a qualified companion diag-
nostic test by the Secretary of Health and Human Serv-
ices in connection with a drug— 
‘‘(1) for which an application has been sub-
mitted under section 501(b)(1) of the Federal Food, 
Drug, and Cosmetic Act, or 
‘‘(2) for which an application has been ap-
proved under such section. 
‘‘(c) QUALIFIED COMPANION DIAGNOSTIC TEST.— 
For purposes of this section, the term ‘qualified com-
panion diagnostic test’ means a diagnostic test in connec-
tion with a drug which— 
‘‘(1) is designed to provide information which 
can be used to increase the safety or effectiveness of 
the drug, and 
‘‘(2) is approved by the Secretary of Health and 
Human Services. 
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‘‘(d) QUALIFIED RESEARCH EXPENSES.—For pur-
poses of this section, the term ‘qualified research expenses’ 
has the meaning given to such term under section 41(b). 
‘‘(e) NO DOUBLE BENEFIT.— 
‘‘(1) COORDINATION WITH OTHER DEDUCTIONS 
AND
CREDITS.—Except as provided in paragraph 
(2), the amount of any deduction or other credit al-
lowable under this chapter for any expense taken 
into account in determining the amount of the credit 
under subsection (a) shall be reduced by the amount 
of the credit under subsection (a) attributable to 
such expense. 
‘‘(2) RESEARCH AND DEVELOPMENT COSTS.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), any amount which is taken 
into account in determining the amount of the 
credit under subsection (a) for any taxable year 
shall not be taken into account for purposes of 
determining the credit under section 41 for 
such taxable year. 
‘‘(B) COSTS TAKEN INTO ACCOUNT IN DE-
TERMINING
BASE
PERIOD
RESEARCH
EX-
PENSES.—Any amount taken into account in 
determining the amount of the credit under 
subsection (a) for any taxable year shall be 
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taken into account in determining base period 
research expenses for purposes of applying sec-
tion 41 to subsequent taxable years. 
‘‘(f) REGULATIONS.—The Secretary, in consultation 
with the Secretary of Health and Human Services, shall 
promulgate such regulations as are necessary to carry out 
the purposes of this section. 
‘‘(g) TERMINATION.—This section shall not apply to 
expenses paid or incurred in taxable years beginning after 
the date which is 5 years after the date of the enactment 
of this section.’’. 
(b) CREDIT TREATED AS PART OF GENERAL BUSI-
NESS CREDIT.—Section 38(b) of the Internal Revenue 
Code of 1986 is amended by striking ‘‘plus’’ at the end 
of paragraph (32), by striking the period at the end of 
paragraph (33) and inserting ‘‘, plus’’, and by adding at 
the end the following new paragraph: 
‘‘(34) the companion diagnostic test credit de-
termined under section 45Q(a).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart D of subchapter A of chapter 1 of the Internal 
Revenue Code of 1986 is amended by adding at the end 
the following new item: 
‘‘Sec. 45Q. Companion diagnostic test credit.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenses paid or incurred in 
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