I 
112TH CONGRESS 
2D SESSION 
H. R. 5853 
To prohibit wholesalers from purchasing prescription drugs from pharmacies, 
and to enhance information and transparency regarding drug wholesalers 
engaged in interstate commerce. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 22, 2012 
Mr. CUMMINGS introduced the following bill; which was referred to the 
Committee on Energy and Commerce 
A BILL 
To prohibit wholesalers from purchasing prescription drugs 
from pharmacies, and to enhance information and trans-
parency regarding drug wholesalers engaged in interstate 
commerce. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Gray Market Drug 
Reform and Transparency Act of 2012’’. 
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SEC. 2. PROHIBITION AGAINST WHOLESALE DISTRIBUTORS 
PURCHASING PRESCRIPTION DRUGS FROM 
PHARMACIES. 
(a) PROHIBITED ACT.—Section 301 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 331) is amend-
ed by adding at the end the following: 
‘‘(aaa) The purchase or receipt by any person re-
quired to report under section 510(b)(3) (relating to 
wholesale distributors of prescription drugs) of any drug 
subject to section 503(b)(1) from a pharmacy or phar-
macist, except that this paragraph does not apply to the 
return of a drug to the wholesale distributor from which 
the particular drug was purchased.’’. 
(b) MISBRANDING.—Section 502 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 352) is amend-
ed by adding at the end the following: 
‘‘(aa) If it is purchased or received in violation of sec-
tion 301(aaa) (prohibiting the purchase or receipt of pre-
scription drugs by wholesale distributors from phar-
macists).’’. 
SEC. 3. REPORTING BY WHOLESALE DISTRIBUTORS OF 
PRESCRIPTION DRUGS. 
(a) REPORTING REQUIREMENT.— 
(1) IN GENERAL.—Section 510 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 360) is 
amended— 
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(A) in subsection (b), by adding at the end 
the following: 
‘‘(3) On or before December 31 of each year, every 
person engaged in the wholesale distribution in interstate 
commerce of drugs subject to section 503(b)(1) shall re-
port to the Secretary such person’s name, contact infor-
mation for such person’s principal officer (or the designee 
thereof), such person’s places of business, such person’s 
licensing information (including the type of license and ex-
piration date) for each State in which such person is so 
engaged, and such other information as the Secretary 
deems appropriate.’’; 
(B) in subsection (c), by adding at the end: 
‘‘Every person upon first engaging in the whole-
sale distribution in interstate commerce of 
drugs subject to section 503(b)(1) shall imme-
diately report to the Secretary the information 
described in subsection (b)(3).’’; and 
(C) in subsection (d), by adding at the end 
the following: ‘‘Every person duly reporting in 
accordance with the foregoing subsections shall 
immediately report to the Secretary with re-
spect to any additional establishment which the 
person owns or operates in any State and in 
which the person begins the wholesale distribu-
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tion in interstate commerce of drugs subject to 
section 503(b)(1).’’. 
(2) REPORTING
NUMBER.—Subsection (e) of 
section 510 of the Federal Food, Drug, and Cos-
metic Act (21 U.S.C. 360) is amended— 
(A) by striking ‘‘registration number’’ and 
inserting ‘‘registration or reporting number’’; 
and 
(B) by inserting ‘‘or reporting in accord-
ance with subsections (b)(3), (c), or (d)’’ after 
‘‘registered in accordance with this section’’. 
(3) PUBLIC
AVAILABILITY; DATABASE.—Sub-
section (f) of section 510 of the Federal Food, Drug, 
and Cosmetic Act (21 U.S.C. 360) is amended— 
(A) 
by 
striking 
‘‘(f)’’ 
and 
inserting 
‘‘(f)(1)’’; and 
(B) by adding at the end the following: 
‘‘(2)(A) The Secretary, acting directly or by entering 
into a contract with a private entity, shall establish and 
maintain a database including all information reported 
under subsection (b)(3), the second sentence of subsection 
(c), and the second sentence of subsection (d). 
‘‘(B) Subject to subparagraph (C), the Secretary 
shall make the information in such database publicly avail-
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able, including on the public Website of the Food and 
Drug Administration. 
‘‘(C) The Secretary may choose to restrict the Sec-
retary’s disclosure of any information reported under sub-
section (b)(3), (c), or (d)— 
‘‘(i) that relates to a storage facility; and 
‘‘(ii) whose disclosure would, as determined by 
the Secretary, compromise the security of such facil-
ity.’’. 
(4) CONFORMING AMENDMENTS.— 
(A) Section 301(p) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 331(p)) is 
amended by inserting ‘‘the failure to report in 
accordance with subsection (b)(3), (c), or (d) of 
section 510,’’ after ‘‘The failure to register in 
accordance with section 510 or 905,’’. 
(B) Section 502(o) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 352(o)) is 
amended by inserting ‘‘if it was distributed in 
interstate commerce by a person in violation of 
the reporting requirements of subsection (b)(3), 
(c), or (d) of section 510,’’ before ‘‘if it was not 
included’’. 
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(C) Section 510 of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 360) is 
amended— 
(i) in subsection (g)— 
(I) in paragraph (3), by adding 
‘‘or’’ at the end; 
(II) by striking paragraph (4); 
(III) by redesignating paragraph 
(5) as paragraph (4); 
(IV) in paragraph (4) (as so re-
designated), by inserting ‘‘or report-
ing, as applicable,’’; and 
(V) by striking the matter fol-
lowing paragraph (4) (as so redesig-
nated); 
(ii) in subsection (h), by adding at the 
end the following: ‘‘Every establishment in 
any State used by a person required to re-
port under subsection (b)(3), (c), or (d) for 
the wholesale distribution in interstate 
commerce of drugs subject to section 
503(b)(1) shall be subject to inspection 
pursuant to section 704.’’; and 
(iii) in subsection (j), by adding at the 
end the following: 
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‘‘(4) The provisions of this subsection shall apply 
with respect to a person required to report under sub-
section (b)(3), (c), or (d) for the wholesale distribution in 
interstate commerce of drugs subject to section 503(b)(1) 
to the same extent and in the same manner as such provi-
sions apply to persons required to register under sub-
section (b), (c), (d), or (i), except that— 
‘‘(A) any reference to manufacturing shall be 
treated as a reference to wholesale distribution; and 
‘‘(B) any reference to a drug shall be treated as 
a reference to a drug subject to section 503(b)(1).’’; 
and 
(D) in subsection (p), by inserting ‘‘and re-
ports under subsection (b)(3), (c), and (d)’’ be-
fore ‘‘shall be submitted’’. 
(b) INFORMATION
ON STATE ACTIONS AGAINST 
WHOLESALE DISTRIBUTORS OF PRESCRIPTION DRUGS.— 
Paragraph (2) of section 510(f) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 360(f)), as added by 
subsection (a)(3)(B) of this section, is amended— 
(1) in subparagraph (A), by adding at the end 
of the subparagraph the following: ‘‘Such database 
shall also include information on actions (such as 
suspension or revocation of licensing) taken by 
States against persons engaged in wholesale dis-
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tribution of drugs subject to section 503(b)(1).’’; 
and 
(2) by adding at the end the following: 
‘‘(D) The Secretary shall encourage States 
to report the type of information described in 
the second sentence of subparagraph (A) to the 
Food and Drug Administration— 
‘‘(i) in a consistent manner; and 
‘‘(ii) on a voluntary basis.’’. 
(c) FEES FOR REPORTING.—Subchapter C of chapter 
VII (21 U.S.C. 379f et seq.) is amended by adding at the 
end the following: 
‘‘PART 7—FEES RELATING TO WHOLESALE 
DISTRIBUTORS OF PRESCRIPTION DRUGS 
‘‘SEC. 744. AUTHORITY TO ASSESS AND COLLECT FEES. 
‘‘(a) IN GENERAL.—For fiscal year 2013 and each 
subsequent fiscal year, the Secretary shall assess and col-
lect fees under this section from each person that reports 
under section 510(b)(3) to engage in the wholesale dis-
tribution in interstate commerce of drugs subject to sec-
tion 503(b)(1). 
‘‘(b) ESTABLISHMENT OF AMOUNT.— 
‘‘(1) IN GENERAL.—Not later than 1 year after 
the date of the enactment of the Gray Market Drug 
Reform and Transparency Act of 2012, the Sec-
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retary shall promulgate a final regulation estab-
lishing the amount of fees under this section for the 
period of fiscal years 2013 through 2017 so as to 
generate a total revenue amount not exceeding the 
Secretary’s estimate of 100 percent of the costs de-
scribed in subsection (c) during such period. 
‘‘(2) CONSIDERATION.—In establishing the 
amount of fees under this section, the Secretary 
shall take into consideration the amount of annual 
revenues of a person to be assessed such fees in 
comparison with the amount of annual revenues of 
other persons to be assessed such fees. 
‘‘(c) COSTS TO BE FUNDED THROUGH FEES.—The 
fees authorized by this section shall only be collected and 
available to pay the costs incurred by the Food and Drug 
Administration in— 
‘‘(1) implementing the reporting requirement 
under section 510(b)(3); and 
‘‘(2) establishing and maintaining an up-to-date 
database of the information collected pursuant to 
such requirement. 
‘‘(d) CREDITING
AND AVAILABILITY FEES.—Fees 
authorized under subsection (a) shall be collected and 
available for obligation only to the extent and in the 
amount provided in advance in appropriation Acts. Such 
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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 limitation to 
such appropriation account for salaries and expenses with 
such fiscal year limitation. The sums transferred shall be 
available solely for the costs described in subsection (c). 
‘‘(e) AUTHORIZATION
OF
APPROPRIATIONS.—For 
each of the fiscal years 2013 through 2017, there is au-
thorized to be appropriated for fees under this section an 
amount equal to the total revenue amount determined 
under subsection (b) for the fiscal year. 
‘‘(f) OFFSET.—If the sum of the cumulative amount 
of fees collected under this section for the fiscal years 
2013 through 2015 and the amount of fees estimated to 
be collected under this section for fiscal year 2016 exceeds 
the cumulative amount appropriated pursuant to sub-
section (e) for the fiscal years 2013 through 2016, the 
excess shall be credited to the appropriation account of 
the Food and Drug Administration as provided in sub-
section (d), and shall be subtracted from the amount of 
fees that would otherwise be authorized to be collected 
under this section pursuant to appropriation Acts for fis-
cal year 2017.’’. 
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SEC. 4. IDENTIFICATION OF SALES PRICE FOR DRUGS IN 
SHORTAGE. 
(a) IDENTIFICATION OF SALES PRICE FOR DRUGS IN 
SHORTAGE.—Paragraph (1) of section 503(e) of the Fed-
eral Food, Drug, and Cosmetic Act (21 U.S.C. 353(e)) 
is amended— 
(1) in subparagraph (A), by inserting before the 
period at the end the following: ‘‘, the amount paid 
for such drug by the person receiving it if such drug 
is in shortage at the time of the sale, and the 
amount paid for such drug for any prior sale that 
occurred at a time when such drug was in short-
age’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(C) In this paragraph, the term ‘in shortage’ means 
listed on the public Website of the Food and Drug Admin-
istration, at the time of the sale to be identified in the 
statement required by subparagraph (A), as being in 
shortage.’’. 
(b) APPLICABILITY.—The amendment made by sub-
section (a) applies only with respect to sales of a drug 
occurring on or after the date that is 1 year after the date 
of the enactment of this Act. 
Æ 
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