‘‘(A) IN GENERAL.—For purposes of the 
rebate under section 1860D–2(f) for contract 
years beginning on or after January 1, 2019, 
each contract entered into with a PDP sponsor 
under this part with respect to a prescription 
drug plan shall require that the sponsor comply 
with subparagraphs (B) and (C). 
‘‘(B) REPORT FORM AND CONTENTS.—Not 
later than a date specified by the Secretary, a 
PDP sponsor of a prescription drug plan under 
this part shall report to each manufacturer— 
‘‘(i) information (by National Drug 
Code number) on the total number of units 
of each dosage, form, and strength of each 
drug of such manufacturer dispensed to re-
bate eligible Medicare drug plan enrollees 
under any prescription drug plan operated 
by the PDP sponsor during the rebate pe-
riod; 
‘‘(ii) information on the price dis-
counts, price concessions, and rebates for 
such drugs for such form, strength, and 
period; 
‘‘(iii) information on the extent to 
which such price discounts, price conces-
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sions, and rebates apply equally to rebate 
eligible Medicare drug plan enrollees and 
PDP enrollees who are not rebate eligible 
Medicare drug plan enrollees; and 
‘‘(iv) any additional information that 
the Secretary determines is necessary to 
enable the Secretary to calculate the aver-
age Medicare drug program rebate eligible 
rebate amount (as defined in paragraph 
(3)(C) of such section), and to determine 
the amount of the rebate required under 
this section, for such form, strength, and 
period. 
Such report shall be in a form consistent with 
a standard reporting format established by the 
Secretary. 
‘‘(C) SUBMISSION TO SECRETARY.—Each 
PDP sponsor shall promptly transmit a copy of 
the information reported under subparagraph 
(B) to the Secretary for the purpose of audit 
oversight and evaluation. 
‘‘(D) 
CONFIDENTIALITY
OF
INFORMA-
TION.—The provisions of subparagraph (D) of 
section 1927(b)(3), relating to confidentiality of 
information, shall apply to information reported 
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by PDP sponsors under this paragraph in the 
same manner that such provisions apply to in-
formation disclosed by manufacturers or whole-
salers under such section, except— 
‘‘(i) that any reference to ‘this sec-
tion’ in clause (i) of such subparagraph 
shall be treated as being a reference to this 
section; 
‘‘(ii) the reference to the Director of 
the Congressional Budget Office in clause 
(iii) of such subparagraph shall be treated 
as including a reference to the Medicare 
Payment Advisory Commission; and 
‘‘(iii) clause (iv) of such subparagraph 
shall not apply. 
‘‘(E) OVERSIGHT.—Information reported 
under this paragraph may be used by the In-
spector General of the Department of Health 
and Human Services for the statutorily author-
ized purposes of audit, investigation, and eval-
uations. 
‘‘(F) PENALTIES
FOR
FAILURE
TO
PRO-
VIDE TIMELY INFORMATION AND PROVISION OF 
FALSE INFORMATION.—In the case of a PDP 
sponsor— 
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‘‘(i) that fails to provide information 
required under subparagraph (B) on a 
timely basis, the sponsor is subject to a 
civil money penalty in the amount of 
$10,000 for each day in which such infor-
mation has not been provided; or 
‘‘(ii) that knowingly (as defined in 
section 1128A(i)) provides false informa-
tion under such subparagraph, the sponsor 
is subject to a civil money penalty in an 
amount not to exceed $100,000 for each 
item of false information. 
Such civil money penalties are in addition to 
other penalties as may be prescribed by law. 
The provisions of section 1128A (other than 
subsections (a) and (b)) shall apply to a civil 
money penalty under this subparagraph in the 
same manner as such provisions apply to a pen-
alty or proceeding under section 1128A(a).’’. 
(2) APPLICATION TO MA ORGANIZATIONS.—Sec-
tion 1857(f)(3) of the Social Security Act (42 
U.S.C. 1395w–27(f)(3)) is amended by adding at 
the end the following: 
‘‘(D) REPORTING REQUIREMENT RELATED 
TO REBATE FOR REBATE ELIGIBLE MEDICARE 
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DRUG
PLAN
ENROLLEES.—Section 1860D– 
12(b)(7).’’. 
(c) DEPOSIT OF REBATES INTO MEDICARE PRE-
SCRIPTION DRUG ACCOUNT.—Section 1860D–16(c) of the 
Social Security Act (42 U.S.C. 1395w–116(c)) is amended 
by adding at the end the following new paragraph: 
‘‘(6) REBATE FOR REBATE ELIGIBLE MEDICARE 
DRUG PLAN ENROLLEES.—Amounts paid under a re-
bate agreement under section 1860D–2(f) shall be 
deposited into the Account.’’. 
(d) EXCLUSION FROM DETERMINATION
OF BEST 
PRICE
AND AVERAGE MANUFACTURER PRICE UNDER 
MEDICAID.— 
(1) EXCLUSION FROM BEST PRICE DETERMINA-
TION.—Section 1927(c)(1)(C)(ii)(I) of the Social Se-
curity Act (42 U.S.C. 1396r–8(c)(1)(C)(ii)(I)) is 
amended by inserting ‘‘and amounts paid under a 
rebate agreement under section 1860D–2(f)’’ after 
‘‘this section’’. 
(2) EXCLUSION
FROM
AVERAGE
MANUFAC-
TURER
PRICE
DETERMINATION.—Section 
1927(k)(1)(B)(i) of the Social Security Act (42 
U.S.C. 1396r–8(k)(1)(B)(i)) is amended— 
(A) in subclause (IV), by striking ‘‘and’’ 
after the semicolon; 
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(B) in subclause (V), by striking the period 
at the end and inserting ‘‘; and’’; and 
(C) by adding at the end the following: 
‘‘(VI) amounts paid under a re-
bate agreement under section 1860D– 
2(f).’’. 
SEC. 206. CAP ON PRESCRIPTION DRUG COST-SHARING. 
(a) QUALIFIED HEALTH PLANS.—Section 1302(c) of 
the Patient Protection and Affordable Care Act (42 
U.S.C. 18022(c)) is amended— 
(1) in paragraph (3)(A)(i), by inserting ‘‘(in-
cluding cost-sharing with respect to prescription 
drugs covered by the plan)’’ after ‘‘copayments’’; 
and 
(2) by adding at the end the following: 
‘‘(5) PRESCRIPTION DRUG COST-SHARING.— 
‘‘(A) 2019.—For plan years beginning in 
2019 or later, the cost-sharing incurred under 
a health plan with respect to prescription drugs 
covered by the plan shall not exceed $250 per 
month for each enrolled individual, or $500 for 
each family. 
‘‘(B) 2020 AND LATER.— 
‘‘(i) IN GENERAL.—In the case of any 
plan year beginning in a calendar year 
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after 2019, the limitation under this para-
graph shall be equal to the applicable dol-
lar amount under subparagraph (A) for 
plan years beginning in 2019, increased by 
an amount equal to the product of that 
amount and the medical care component of 
the consumer price index for all urban con-
sumers (as published by the Bureau of 
Labor Statistics) for that year. 
‘‘(ii) ADJUSTMENT
TO
AMOUNT.—If 
the amount of any increase under clause 
(i) is not a multiple of $5, such increase 
shall be rounded to the next lowest mul-
tiple of $5.’’. 
(b) GROUP HEALTH PLANS.—Section 2707(b) of the 
Public Health Service Act (42 U.S.C. 300gg–6(b)) is 
amended by striking ‘‘paragraph (1) of section 1302(c)’’ 
and inserting ‘‘paragraphs (1) and (5) of section 1302(c) 
of the Patient Protection and Affordable Care Act’’. 
(c) EFFECTIVE DATE.—The amendments made by 
subsections (a) and (b) shall take effect with respect to 
the first plan year that begins after the date on which 
initial reports are required to be submitted under section 
399V–7(c)(3) of the Public Health Service Act, as added 
by section 101. 
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TITLE III—INNOVATION 
SEC. 301. PRIZE FUND FOR NEW AND MORE EFFECTIVE 
TREATMENTS OF BACTERIAL INFECTIONS. 
Part B of title IV of the Public Health Service Act 
(42 U.S.C. 284 et seq.) is amended by adding at the end 
the following: 
‘‘SEC. 409K. PRIZE FUND FOR NEW AND MORE EFFECTIVE 
TREATMENTS OF BACTERIAL INFECTIONS. 
‘‘(a) ESTABLISHMENT OF FUND.—There is hereby 
established in the Treasury of the United States a revolv-
ing fund to be known as the ‘Antibiotics Prize Fund’, 
which shall consist of funds transferred under subsection 
(b). 
‘‘(b) AMOUNTS CREDITED TO THE FUND.—There 
are hereby authorized to be appropriated, and appro-
priated, to the Antibiotics Prize Fund, for fiscal year 
2018, out of any monies in the Treasury not otherwise 
appropriated, $2,000,000,000. Such funds shall remain 
available until expended. 
‘‘(c) AWARDS.— 
‘‘(1) IN GENERAL.—During the 10-year period 
following the date of enactment of the Improving 
Access To Affordable Prescription Drugs Act, the 
Director of the NIH, in accordance with the criteria 
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under subsection (d) and the goals under subsection 
(e), shall award— 
‘‘(A) up to 3 prizes for qualifying products 
that provide added benefit for patients over ex-
isting therapies in the treatment of serious and 
life-threatening 
bacterial 
infections 
dem-
onstrating in superiority trials; and 
‘‘(B) award open source dividend prizes for 
contributions that significantly advance the 
field of antibiotic research with openly sourced 
materials, technology, data, and knowledge. 
‘‘(2) AWARD
AMOUNT
REQUIREMENTS.—No 
more than 5 percent of the amount available in the 
Antibiotics Prize Fund shall be dedicated to open 
source dividend prizes. 
‘‘(d) CRITERIA AND STRUCTURE OF PRIZES.— 
‘‘(1) ESTABLISHMENT OF CRITERIA.—Not later 
than 120 days after the date of enactment of the 
Improving Access To Affordable Prescription Drugs 
Act, the Director of NIH shall establish criteria for 
the selection of recipients and eligibility of persons 
for prizes under this section and criteria for deter-
mining the amounts of such prizes, through notice 
and comment rulemaking. 
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‘‘(2) CONSIDERATIONS IN ESTABLISHING CRI-
TERIA FOR QUALIFYING PRODUCTS.—In establishing 
the criteria for selection of recipients and amounts 
of prizes under paragraph (1), the Director of NIH, 
in consultation with other agencies as appropriate, 
shall consider the following: 
‘‘(A) The number of patients in the United 
States and in other countries who would benefit 
from the qualifying product that treats a seri-
ous or life-threatening bacterial infection, and 
the number of patients in the United States 
and in other countries projected to benefit dur-
ing the upcoming 10-year period. 
‘‘(B) Whether the qualifying product 
treats, or has the potential to treat, a serious 
or life-threatening bacterial infection for which 
no other treatment is currently available or for 
which there is a high threat of resistance to ex-
isting treatments. 
‘‘(C) The incremental and additional thera-
peutic benefit to human in the United States 
and other countries of the qualifying product as 
compared to other treatments available to treat 
the bacterial infection, evaluating the incre-
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mental therapeutic benefit in comparison to 
treatments that were not recently developed. 
‘‘(D) The transmissibility of the bacterial 
infection the qualifying product would treat, 
and barriers to prevention of that infection. 
‘‘(E) The extent to which knowledge, data, 
materials, and technology that are openly 
sourced have contributed to the successful de-
velopment of new treatments that provide an 
added benefit to patients, such as decreasing 
mortality or irreversible morbidity on patient- 
centered outcomes, significantly advancing the 
field of antibiotic research, or improving proc-
esses for manufacturing products used for the 
treatment. 
‘‘(F) Other criteria that the Director of 
NIH determines to be relevant and useful in 
ensuring that the prizes provide appropriate in-
centives. 
‘‘(3) CRITERIA FOR OPEN SOURCE DIVIDEND 
PRIZES.—An open source dividend prize under this 
section shall reward persons that openly shared on 
a royalty-free, not-for-profit and non-discriminatory 
basis, materials, technology, data, and knowledge 
that contribute in a significant way to the successful 
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development of a qualifying product or significantly 
advanced the field of antibiotic research. 
‘‘(e) GOALS.—With respect to each year for which the 
Director of NIH awards prizes under subsection (c), the 
Director of NIH shall establish a framework of goals that 
a qualifying product or contribution that significantly ad-
vances the field of antibiotic research is required to show 
promise to help meet in order for a person to be eligible 
to receive a prize with respect to such product or such 
contribution. Such goals may include— 
‘‘(1) reduced hospital admissions or readmis-
sions; 
‘‘(2) use of diagnostics prior to prescribing of 
drugs; and 
‘‘(3) use of innovative programs for antibiotic 
stewardship. 
‘‘(f) CONDITION ON RECEIPT OF PRIZE.— 
‘‘(1) IN GENERAL.—Each prize for a qualifying 
product offered under this section shall be condi-
tioned on the following: 
‘‘(A) The recipient shall agree to offer the 
qualifying product at a reasonable price as de-
scribed in paragraph (3). 
‘‘(B) Subject to applicable patient privacy 
protections, the recipient shall agree to publicly 
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disclose all pre-clinical and clinical trial data 
with respect to the qualifying product. 
‘‘(C) The recipient shall agree to submit to 
the Director of NIH, for review and approval 
by such director, in collaboration with the Com-
missioner of Food and Drugs and the Director 
of the Centers for Disease Control and Preven-
tion, all marketing, sales, and other promotional 
and educational activities associated with the 
qualifying product, to ensure that such activi-
ties align with, and advance the goals of, re-
source conserving stewardship, protecting the 
utility of antibiotics, and encouraging and en-
suring the correct use of antibiotics. 
‘‘(D) 
The 
recipient 
shall 
irrevocably 
waive— 
‘‘(i) all periods of exclusivity available 
to the product under chapter V of the Fed-
eral Food, Drug, and Cosmetic Act or sec-
tion 351 of this Act; and 
‘‘(ii) all applicable patent rights under 
title 35, United States Code. 
‘‘(E) Any other conditions the Director of 
NIH determines appropriate. 
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‘‘(2) APPLICABILITY.—All conditions described 
in paragraph (1) shall apply to subsequent owners, 
licensees, producers, and manufacturers, and assign-
ees of the product or any chemical component of the 
qualifying product for which the prize was awarded. 
‘‘(3) REASONABLE PRICE.— 
‘‘(A) IN GENERAL.—A recipient may sat-
isfy the requirement to offer a qualifying prod-
uct or contribution at a ‘reasonable price’ for 
purposes of paragraph (1)(A) by— 
‘‘(i)(I) providing open licensing of all 
necessary rights to patents, manufacturing 
processes, rights in data, and other intel-
lectual property rights needed to make and 
sell the product to manufacturers of the 
generic version of such product; or 
‘‘(II) selling such product at a price 
that is no more than twice the price of an-
tibiotic drugs approved under section 
505(j) of the Federal Food, Drug, and 
Cosmetic Act with similar manufacturing 
costs; and 
‘‘(ii) selling such product at a price 
that is not higher than the median price 
charged, at the time of such sale, in the 
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applicable 7 countries, as determined 
under in subparagraph (B). 
‘‘(B) CRITERIA.—For purposes of subpara-
graph (A)(ii), the Director of NIH shall iden-
tify, on an annual basis, the countries that have 
a per capita income that is not less than half 
the per capita income of the United States, se-
lect the 7 of such countries that have the larg-
est gross domestic product, and determine the 
median price charged for each qualifying prod-
uct for which an award has been granted under 
subsection (c). 
‘‘(g) ENFORCEMENT.—If the prize recipient, or sub-
sequent owner, licensee, or assignee of the qualifying prod-
uct, does not fulfill the conditions described subsection 
(f)(1), the Secretary, in collaboration with the Attorney 
General, shall take all necessary action to clawback the 
prize. 
‘‘(h) TRANSPARENCY.—With respect to each prize 
awarded under this section, the Director of NIH shall 
make public— 
‘‘(1) the methodology used and criteria analyzed 
in determining the prize recipient; and 
‘‘(2) a complete analysis of the recipient’s ful-
fillment of award conditions under subsection (e)(1). 
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‘‘(i) QUALIFYING PRODUCT.—For purposes of this 
section, the term ‘qualifying product’ means a drug (as 
defined in section 201(g) of the Federal Food, Drug, and 
Cosmetic Act) subject to section 503(b)(1) of the Federal 
Food, Drug, and Cosmetic Act. 
‘‘(j) STUDY.— 
‘‘(1) IN GENERAL.—The Director of NIH shall 
seek to enter into an agreement with the National 
Academies of Sciences, Engineering, and Medicine to 
conduct a study to examine— 
‘‘(A) the use of innovation inducement 
prize funds and push financing mechanisms as 
ways to stimulate investments in biomedical re-
search and development that de-links costs from 
product prices; 
‘‘(B) models of different possible means of 
de-linking research and development costs from 
drug prices, including the replacement of the 
monopoly on new products as an incentive, with 
innovation inducement prize funds and push fi-
nancing mechanisms as new incentives to stim-
ulate the development of drugs, including drugs 
to treat bacterial infections, rare diseases, HIV/ 
AIDS, and cancer; and 
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is 5 years after the date on which the 
drug to which the application refers 
was approved under subsection (c)’’ 
before the period; and 
(ii) in subparagraph (F)(ii)— 
(I) by striking ‘‘expiration of five 
years’’ and inserting ‘‘expiration of 3 
years’’; 
(II) by striking ‘‘, except that 
such an application may be submitted 
under this subsection after the expira-
tion of four years from the date of the 
approval of the subsection (b) applica-
tion if it contains a certification of 
patent invalidity or noninfringement 
described in subclause (IV) of para-
graph (2)(A)(vii)’’; and 
(III) by striking ‘‘seven and one- 
half years’’ and inserting ‘‘6 and one- 
half years’’. 
(B) CONFORMING AMENDMENTS.—Chapter 
V of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 351 et seq.) is amended— 
(i) in subsection (v)(2)(A)(i)(II) of 
section 505, by inserting ‘‘the 3-year exclu-
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