I 
116TH CONGRESS 
2D SESSION 
H. R. 7296 
To require any COVID–19 drug developed in whole or in part with Federal 
support to be affordable and accessible by prohibiting monopolies and 
price gouging, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 22, 2020 
Ms. SCHAKOWSKY (for herself, Mr. ROONEY of Florida, Mr. DOGGETT, Ms. 
DELAURO, Mr. DEFAZIO, Mr. POCAN, and Ms. JAYAPAL) introduced the 
following bill; which was referred to the Committee on Energy and Com-
merce, and in addition to the Committees on the Judiciary, Science, 
Space, and Technology, and Armed Services, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such 
provisions as fall within the jurisdiction of the committee concerned 
A BILL 
To require any COVID–19 drug developed in whole or in 
part with Federal support to be affordable and accessible 
by prohibiting monopolies and price gouging, and for 
other purposes. 
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 ‘‘Make Medications Af-
fordable by Preventing Pandemic Price gouging Act of 
2020’’ or the ‘‘MMAPPP Act of 2020’’. 
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SEC. 2. REQUIREMENTS FOR LICENSING OF NEW COVID–19 
TREATMENT 
AND 
PREVENTION 
TECH-
NOLOGIES TO MEET DOMESTIC AND GLOBAL 
DEMAND. 
(a) NONEXCLUSIVE LICENSE REQUIRED.—Any cov-
ered license granted by the Federal Government shall be 
an open, nonexclusive license. 
(b) 
CONTRACTOR, 
ASSIGNEE, 
EXCLUSIVE
LI-
CENSEE.—Notwithstanding any other provision of law, 
any contractor, assignee, or exclusive licensee to an inven-
tion developed in whole or in part in work performed 
under a covered transaction shall grant an open, non-ex-
clusive license. If any such contractor, assignee, or exclu-
sive licensee refuses to grant such license, the Federal gov-
ernment shall grant the license. 
(c) REASONABLE ROYALTY.— 
(1) IN GENERAL.—Except as provided in para-
graph (4), an entity that accepts an open, nonexclu-
sive license under this section shall pay a reasonable 
royalty with respect to sales within the United 
States to— 
(A) the holder of a patent that claims the 
COVID–19 related invention; or 
(B) to the holder of an application ap-
proved under section 505 of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 355) or 
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section 351 of the Public Health Service Act 
(42 U.S.C. 262) for which any FDA-granted 
exclusivity with respect to a drug related to 
such invention that was terminated under this 
section. 
(2) ROYALTY.—The reasonable royalty de-
scribed under paragraph (1) shall be a percentage of 
sales of the entity paying the royalty, where the per-
centage rate is no higher than the average royalty 
rate estimated from the data provided by the Inter-
nal Revenue Service for pharmaceutical manufac-
turer Federal income tax returns. 
(3) REQUIREMENTS.— 
(A) IN GENERAL.—The royalty described 
under paragraph (2) shall be subject to the ap-
plicable royalty rate requirements of section 
319B of the Public Health Service Act, as 
added by section 5 of this Act. 
(B) MULTIPLE
AFFECTED
PARTIES.—In 
the case of more than one recipient of a royalty, 
the royalty shall be divided among each such re-
cipient (including any manufacturer) in a man-
ner agreed upon by the manufacturer and other 
recipients, or, in the absence of such an agree-
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ment, in a manner the Secretary determines to 
be appropriate. 
(4) EXCEPTION FOR GOVERNMENT-OWNED IN-
VENTIONS.—An entity that accepts an open, non-
exclusive license for a federally owned invention de-
scribed under section 207 of title 35, United States 
Code, is not required to pay a royalty under this sec-
tion. 
(d) DEFINITIONS.—In this section: 
(1) COVERED LICENSE.—The term ‘‘covered li-
cense’’ means a license that allows a licensee to 
make, use, offer to sell, or sell, export, or import 
into the United States or any other country or terri-
tory a COVID–19 related invention pursuant to— 
(A) section 207 of title 35, United States 
Code; and 
(B) section 12 of the Stevenson-Wydler 
Technology Innovation Act of 1980 (15 U.S.C. 
3710a). 
(2) COVERED TRANSACTION.—The term ‘‘cov-
ered transaction’’ means any contract, funding 
agreement, license, other transaction, or other ar-
rangement entered into between a party and the 
Federal Government on or after the date of enact-
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ment of this Act with respect to research and devel-
opment regarding a drug that— 
(A) is intended or anticipated to be used to 
diagnose, mitigate, prevent, or treat COVID– 
19; and 
(B) consists of— 
(i) a licensing agreement pursuant to 
section 207 of title 35, United States 
Code; 
(ii) a cooperative research and devel-
opment agreement and licensing agreement 
pursuant to section 12 of the Stevenson- 
Wydler Technology Innovation Act of 1980 
(15 U.S.C. 3710a); 
(iii) a funding agreement, as defined 
under section 201 of title 35, United 
States Code; or 
(iv) any other transaction entered into 
pursuant to— 
(I) section 319L, 421, or 480 of 
the Public Health Service Act (42 
U.S.C. 247d–7e, 285b–3, 287a); 
(II) section 105 of the National 
Institutes of Health Reform Act of 
2006 (42 U.S.C. 284n); or 
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(III) section 2371 of title 10, 
United States Code. 
(3) COVID–19 
RELATED
INVENTION.—The 
term ‘‘COVID–19 related invention’’ means any in-
vention that claims a drug that is manufactured, 
used, designed, developed, modified, licensed, or pro-
cured to diagnose, mitigate, prevent, treat, or cure 
COVID–19; a use of such drug; a form of such 
drug; a method of use of such drug; or a method of 
manufacturing such drug. 
(4) FDA-GRANTED
EXCLUSIVITY.—The term 
‘‘FDA-granted exclusivity’’ means prohibitions on 
the submission or approval of drug applications 
granted under any of the following: 
(A) Clauses (ii) through (v) of section 
505(c)(3)(E) of the Federal Food, Drug, and 
Cosmetic Act (21 U.S.C. 355(c)(3)(E)). 
(B) Subsection (j)(5)(B)(iv) or clause (ii), 
(iii), or (iv) of subsection (j)(5)(F) of such Act 
(21 U.S.C. 355(c)(3)(E)). 
(C) Section 505A of such Act (21 U.S.C. 
355a). 
(D) Section 505E of such Act (21 U.S.C. 
355f). 
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(E) Section 527 of such Act (21 U.S.C. 
360cc). 
(F) Section 351(k)(7) of this Act (42 
U.S.C. 262(k)(7)). 
(G) Any other provision of law that pro-
vides for marketing or data exclusivity (or ex-
tension of exclusivity) with respect to a drug. 
(5) OPEN, NONEXCLUSIVE LICENSE.—The term 
‘‘open, nonexclusive license’’ means a license that al-
lows a qualified licensee, subject to the provisions of 
the Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 301 et seq.) and the Public Health Service 
Act (42 U.S.C. 201 et seq.)— 
(A) to make, use, offer to sell, sell, export, 
or import into the United States and any other 
country and territory an invention; 
(B) to reference or rely upon earlier-sub-
mitted regulatory test data or the earlier grant 
of marketing approval of a treatment or vaccine 
related to such invention; and 
(C) to access and use otherwise confiden-
tial know-how relating to the manufacture of 
such invention. 
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SEC. 3. REQUIREMENTS FOR REASONABLE PRICING OF 
FEDERALLY SUPPORTED COVID–19 DRUGS. 
(a) REASONABLE PRICING REQUIREMENTS.—Any 
covered transaction shall include terms and conditions re-
quiring that the pricing of the drug by the party referred 
to in subsection (b)(1) be fair and reasonable, and facili-
tate global access, taking into consideration— 
(1) the impact of the price on access to the 
drug in the United States, taking into consideration 
racial disparities in COVID–19 cases and fatalities 
and other socioeconomic disparities; 
(2) the impact of the price on health program 
spending and budgets in the United States; 
(3) the risk adjusted value of Federal subsidies 
and investments related to the drug; 
(4) the costs associated with development and 
manufacturing of the drug; 
(5) the size of the affected patient population in 
the United States and globally; and 
(6) the therapeutic efficacy of the drug. 
(b) DEFINITIONS.—In this section: 
(1) COVERED TRANSACTION.—The term ‘‘cov-
ered transaction’’ has the meaning given to such 
term in section 2. 
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(2) DRUG.—The term ‘‘drug’’ has the meaning 
given to such term in section 201 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 321). 
SEC. 4. REPORTING ON THE EXPENDITURES OF MANUFAC-
TURERS WITH RESPECT TO COVID–19 DRUGS. 
(a) COVERED DRUG.—For purposes of this section, 
the term ‘‘covered drug’’ means a drug that is intended 
or anticipated to be used to diagnose, mitigate, prevent, 
or treat COVID–19. 
(b) REPORTING REQUIRED.—The manufacturer of a 
covered drug shall submit a report described in subsection 
(c) to the Secretary upon— 
(1) the submission of an application for ap-
proval of the drug under subsection (b) or (j) of sec-
tion 505 of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 355); 
(2) investigational use of the drug under section 
505(i) of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 355(i)) or section 351 of the Public 
Health Service Act (42 U.S.C. 262); 
(3) the submission of an application for licens-
ing the drug under subsection (a) or (k) of section 
351 of the Public Health Service Act (42 U.S.C. 
262); 
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(4) the issuance of an authorization for emer-
gency use of the drug under section 564 of the Fed-
eral Food, Drug, and Cosmetic Act (21 U.S.C. 
360bbb–3); or 
(5) the marketing of the drug. 
(c) CONTENTS.—A report under subsection (a), con-
sistent with the standard for disclosures described in sec-
tion 213.3(d) of title 12, Code of Federal Regulations (as 
in effect on the date of enactment of this Act), shall ad-
dress the expenditures of the manufacturer with respect 
to the covered drug and include, at a minimum— 
(1) the sponsor or sponsors of the covered drug; 
and 
(2) the current wholesale acquisition cost of the 
covered drug when applicable; 
(3) the total expenditures of the manufacturer, 
specified by individual costs, on— 
(A) materials and manufacturing for the 
covered drug; and 
(B) acquiring patents and licensing for the 
covered drug; 
(4) the total amount and percentage of research 
and development expenditures for the covered drug 
that was derived from Federal funds; 
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(5) the total amount of any Federal benefits re-
ceived by the manufacturer with respect to the cov-
ered drug, including— 
(A) the specific amounts and periods of 
impact for each such benefit; 
(B) the specific value of any tax credits, 
including benefits from patient assistance pro-
grams and donated samples; 
(C) clinical and preclinical investments; 
(D) any Federal benefit toward manufac-
turing costs, including building or retrofitting 
facilities; 
(E) Federal grants, including from the Na-
tional Institutes of Health, the Centers for Dis-
ease Control and Prevention, the Department of 
Defense, the Department of Energy, or other 
Federal departments or agencies; 
(F) patent applications that benefitted 
from such grants; 
(G) patent extensions; 
(H) exclusivity periods; and 
(I) waivers of fees; 
(6) the total expenditures of the manufacturer 
on research and development, itemized by basic and 
preclinical research and by clinical research, re-
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(9) the specific expenditures associated with 
marketing and advertising costs for the covered 
drug; 
(10) any anticipated royalty fees from licensing 
to other manufacturers; and 
(11) with respect to the manufacturer— 
(A) all stock-based performance metrics 
used by the manufacturer to determine execu-
tive compensation over the preceding 12 
months; and 
(B) any additional information the manu-
facturer chooses to provide related to drug pric-
ing decisions. 
(d) CIVIL MONETARY PENALTIES.— 
(1) FAILURE TO SUBMIT.—Any manufacturer 
of a covered drug that fails to submit a report as 
required by this section, following notification by the 
Secretary to the manufacturer that the manufac-
turer is not in compliance with this section, shall be 
subject to a civil monetary penalty of $100,000 for 
each day on which the violation continues. 
(2) FALSE INFORMATION.—Any manufacturer 
of a covered drug that knowingly provides false in-
formation in a report under this section is subject to 
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a civil monetary penalty in an amount not to exceed 
$100,000 for each item of false information. 
(e) PUBLIC POSTING.— 
(1) IN GENERAL.—Subject to paragraph (3), 
the Secretary shall post each report submitted under 
subsection (b) on the public website of the Depart-
ment of Health and Human Services no later than 
30 days after the submission of the report. 
(2) FORMAT.—The Secretary shall ensure that 
such reports are— 
(A) user-friendly to the public; and 
(B) written in plain language that con-
sumers can readily understand. 
(3) PROTECTED
INFORMATION.—Nothing in 
this section shall be construed to authorize the pub-
lic disclosure of information submitted by a manu-
facturer that is prohibited from disclosure by appli-
cable laws concerning the protection of trade secrets, 
commercial information, and other information cov-
ered under such laws. 
(f) DEFINITION.—In this section, the term ‘‘drug’’ 
has the meaning given to such term in section 201 of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 321). 
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SEC. 5. PRICING REQUIREMENTS FOR EXISTING TREAT-
MENTS AND VACCINES IN A PUBLIC HEALTH 
EMERGENCY. 
Title III of the Public Health Service Act is amended 
by inserting after section 319A (42 U.S.C. 247d–1a) the 
following new section: 
‘‘SEC. 319B. PRICING REQUIREMENTS FOR TREATMENTS 
AND VACCINES IN A PUBLIC HEALTH EMER-
GENCY. 
‘‘(a) DEFINITIONS.—For purposes of this section: 
‘‘(1) The term ‘covered drug’ means a drug (in-
cluding any vaccine) used to diagnose, mitigate, pre-
vent, or treat a disease or disorder with respect to 
which there is or was in effect a declaration of a 
public health emergency under section 319. 
‘‘(2) The term ‘covered period’ means the pe-
riod ending if and when the circumstances which led 
to the public health emergency cease to exist and are 
unlikely to recur. 
‘‘(3) The term ‘FDA-granted exclusivity’ means 
prohibitions on the submission or approval of drug 
applications granted under any of the following: 
‘‘(A) Clauses (ii) through (v) of section 
505(c)(3)(E) of the Federal Food, Drug, and 
Cosmetic Act. 
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‘‘(B) Subsection (j)(5)(B)(iv) or clause (ii), 
(iii), or (iv) of subsection (j)(5)(F) of such Act. 
‘‘(C) Section 505A of such Act. 
‘‘(D) Section 505E of such Act. 
‘‘(E) Section 527 of such Act. 
‘‘(F) Section 351(k)(7) of this Act. 
‘‘(G) Any other provision of law that pro-
vides for marketing or data exclusivity (or ex-
tension of exclusivity) with respect to a drug. 
‘‘(4) The term ‘wholesale acquisition cost’ has 
the 
meaning 
given 
that 
term 
in 
section 
1847A(c)(6)(B) of the Social Security Act. 
‘‘(b) DETERMINATION OF EXCESSIVE PRICE.—Dur-
ing any covered period with respect to a covered drug, the 
Secretary shall determine that the price of a covered drug 
is excessive if the wholesale acquisition cost (or a more 
relevant measure of price) of the covered drug is not fair 
and reasonable, or does not facilitate global access, taking 
into consideration— 
‘‘(1) the impact of the price on access to the 
covered drug in the United States, taking into con-
sideration racial disparities and other socioeconomic 
disparities; 
‘‘(2) the impact of the price on health program 
spending and budgets in the United States; 
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‘‘(3) the risk adjusted value of Federal sub-
sidies and investments related to the covered drug; 
‘‘(4) the costs associated with development and 
manufacturing of the covered drug; 
‘‘(5) the size of the affected patient population 
in the United States and globally; and 
‘‘(6) the therapeutic efficacy of the covered 
drug. 
‘‘(c) EXCESSIVE PRICING REMEDY.—If the Secretary 
determines pursuant to subsection (b) that the price of 
a covered drug is excessive, the Secretary— 
‘‘(1) shall waive or void any FDA-granted 
exclusivities with respect to the covered drug, effec-
tive on the date that the excessive price determina-
tion is made; and 
‘‘(2) shall grant open, nonexclusive licenses al-
lowing any person to make, use, offer to sell, or sell, 
or import into the United States such drug, and to 
rely upon the regulatory test data of such drug, and 
to access and use otherwise confidential information, 
including know-how, related to the manufacture of 
such drug in accordance with subsection (d). 
‘‘(d) REASONABLE ROYALTY.— 
‘‘(1) IN
GENERAL.—An entity accepting an 
open, nonexclusive license under subsection (c)(2) 
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shall pay a reasonable royalty with respect to sales 
within the United States to the holder of a patent 
that claims the covered drug or that claims a use of 
the covered drug or to the holder of an application 
approved under section 505 of the Federal Food, 
Drug, and Cosmetic Act or section 351 of the Public 
Health Service Act for which any FDA-granted ex-
clusivity with respect to the covered drug was termi-
nated under subsection (c)(1). 
‘‘(2) ROYALTY RATE.—Such royalty rate shall 
be— 
‘‘(A) a percentage of sales, where the per-
centage rate is no higher than the average roy-
alty rate estimated from the data provided by 
the Internal Revenue Service for pharma-
ceutical manufacturer Federal income tax re-
turns; or 
‘‘(B) an amount as determined by the Sec-
retary, taking into account— 
‘‘(i) the therapeutic efficacy of the 
covered drug; 
‘‘(ii) the size of the affected patient 
population in the United States and glob-
ally; 
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‘‘(iii) the risk adjusted value of Fed-
eral subsidies and investments related to 
the covered; 
‘‘(iv) the extent to which the manufac-
turer of the covered drug has recovered 
risk adjusted investments related to the 
covered drug, including the investments re-
lated to the invention, regulatory test data, 
and any other relevant research and devel-
opment costs; and 
‘‘(v) any other information the Sec-
retary determines appropriate. 
‘‘(3) SALES
WITHIN
OTHER
COUNTRIES.—An 
entity accepting an open, nonexclusive license under 
subsection (c)(2) shall pay a reasonable royalty with 
respect to sales within other countries based on the 
royalty rate paid in the United States times the 
ratio between that country’s gross domestic product 
per capita divided by the United States’ gross do-
mestic product per capita in the last year such data 
was available for both countries, but such royalty 
shall only be due if there are granted patents or 
data exclusivity rights in that country at the time of 
sale. 
‘‘(e) REQUIREMENTS.— 
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‘‘(1) IN GENERAL.—A royalty rate under sub-
section (d) shall be consistent with making the cov-
ered drug available to purchasers, including govern-
mental and nongovernmental purchasers and individ-
uals, at prices that are affordable and reasonable. 
Under no condition shall a royalty be set at a rate 
that would cause a covered drug for which an open, 
nonexclusive license was issued under subsection (c) 
to be sold at an excessive price, as determined under 
subsection (b). 
‘‘(2) MULTIPLE
AFFECTED
PARTIES.—In the 
case that there is one or more holders or investors 
in the patented inventions related to the covered 
drug, the royalty rate shall be divided among the 
holders or investors (including such manufacturer) 
in a manner agreed upon by the manufacturer and 
other holders or investors, or, in the absence of such 
an agreement, in a manner the Secretary determines 
to be appropriate. 
‘‘(3) PRICE.—An entity accepting an open, non-
exclusive license under subsection (c)(2) shall sell 
the covered drug at a price not higher than the ex-
cessive price determined for the covered drug under 
subsection (b). 
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‘‘(f) CLARIFICATION.—An open, nonexclusive license 
under subsection (c)(2) shall be liable, subject to adequate 
protection of the legitimate interests of any party utilizing 
the license, to be terminated only if the circumstances 
which led to the granting of the open, nonexclusive license 
cease to exist and are unlikely to recur. The Secretary may 
review, upon request, the continued existence of these cir-
cumstances.’’. 
Æ 
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