drug manufacturer in the event that the 
Secretary determines there to be a need for 
additional finished eligible drug product 
and such eligible entity is unable to use the 
reserve of active pharmaceutical ingredient 
to manufacture a sufficient supply of such 
drug product; and 
(ii) permits the Secretary to direct al-
location of the reserve of active pharma-
ceutical ingredient so maintained in the 
event of a public health emergency or 
chemical, biological, radiological, or nuclear 
threat. 
(2) GUIDANCE.—Not later than 180 days after 
the date of enactment of this Act, the Secretary, in 
coordination with the Commissioner of Food and 
Drugs, shall issue guidance on— 
(A) the factors the Secretary will use to 
determine which eligible drugs, or active phar-
maceutical ingredient of such drugs, have vul-
nerable supply chains and how a contract or co-
operative agreement would help minimize the 
vulnerability or vulnerabilities identified; 
(B) the factors the Secretary will consider 
in determining eligibility of an entity to partici-
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pate in the program under this section, which 
shall include an entity’s commitment to quality 
systems, including strong manufacturing infra-
structure, reliable processes, and trained staff, 
as well as the entity’s commitment to domestic 
manufacturing capacity and surge capacity, as 
appropriate; and 
(C) requirements for entities receiving an 
award under this section, including the extent 
of excess manufacturing capacity the manufac-
turers will be required to generate, the amount 
of redundancy required, and requirements relat-
ing to advanced quality systems. 
(3) PREFERENCE.—In awarding contracts and 
cooperative agreements under subsection (a), the 
Secretary shall give preference to eligible entities 
that will carry out the requirements of paragraph 
(1) through one or more domestic establishments 
registered under section 510(b) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 360(b)) capable 
of manufacturing the eligible drug. To the greatest 
extent practicable, the Secretary shall award con-
tracts and cooperative agreements with manufactur-
ers in a manner that strengthens domestic manufac-
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turing, resiliency, and capacity of eligible drugs and 
their active pharmaceutical ingredients. 
(c) ADDITIONAL
CONTRACT
AND
COOPERATIVE 
AGREEMENT TERMS.— 
(1) IN GENERAL.—Each contract or cooperative 
agreement under subsection (a) shall be subject to 
such terms and conditions as the Secretary may 
specify, including terms and conditions with respect 
to procurement, maintenance, storage, testing, and 
delivery of drugs, in alignment with inventory man-
agement and other applicable best practices, under 
such contract or cooperative agreement, which may 
consider, as appropriate, costs of transporting and 
handling such drugs. 
(2) TERMS
CONCERNING
THE
ACQUISITION, 
CONSTRUCTION, ALTERATION, OR RENOVATION OF 
ESTABLISHMENTS.—Notwithstanding section 6303 
of title 41, United States Code, the Secretary may 
award a contract or cooperative agreement under 
this section to support the acquisition, construction, 
alteration, or renovation of non-federally owned es-
tablishments— 
(A) as determined necessary to carry out 
or improve preparedness and response capa-
bility at the State and local level; or 
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(B) for the production of drugs, devices, 
and supplies where the Secretary determines 
that such a contract or cooperative agreement 
is necessary to ensure sufficient amounts of 
such drugs, devices, and supplies. 
(d) REQUIREMENTS IN AWARDING CONTRACTS.—To 
the greatest extent practicable, the Secretary shall award 
contracts and cooperative agreements under this section 
in a manner that— 
(1) maximizes quality, minimizes cost, mini-
mizes vulnerability of the United States to severe 
shortages or disruptions for eligible drugs and their 
active pharmaceutical ingredients, gives preference 
to domestic manufacturers, and encourages competi-
tion in the marketplace; and 
(2) increases domestic production surge capac-
ity and reserves of domestic-based manufacturing es-
tablishments for critical drugs and active pharma-
ceutical ingredients of such drugs. 
(e) DEFINITIONS.—In this section: 
(1) ACTIVE PHARMACEUTICAL INGREDIENT.— 
The term ‘‘active pharmaceutical ingredient’’ has the 
meaning given such term in section 744A of the 
Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
379j–41). 
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(2) DRUG.—The term ‘‘drug’’ has the meaning 
given such term in section 201(g) of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 321(g)). 
(3) DRUG
SHORTAGE; SHORTAGE.—The term 
‘‘drug shortage’’ or ‘‘shortage’’ has the meaning 
given such term in section 506C of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 356c). 
(4) ELIGIBLE DRUG.—The term ‘‘eligible drug’’ 
means a drug, as determined by the Secretary, in 
coordination with the Assistant Secretary for Pre-
paredness and Response, the Director of the Centers 
for Disease Control and Prevention, and the Com-
missioner of Food and Drugs— 
(A) that is approved under section 505(j) 
of the Federal Food, Drug, and Cosmetic Act 
(21 U.S.C. 355(j)) or licensed under section 
351(k) of the Public Health Service Act (42 
U.S.C. 262(k)); 
(B)(i) that is reasonably likely to be re-
quired to respond to a public health emergency 
or to a chemical, biological, radiological, or nu-
clear threat; or 
(ii) the shortage of which would pose a sig-
nificant threat to the United States health care 
system or at-risk populations; and 
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(C) that has a vulnerable supply chain, 
such as a geographic concentration of manufac-
turing, poor quality or safety issues, complex 
manufacturing or chemistry, or few manufac-
turers. 
(5) ELIGIBLE ENTITY.—The term ‘‘eligible enti-
ty’’ means a person that— 
(A)(i) is the holder of an approved applica-
tion under subsection (j) of section 505 of the 
Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 355) or subsection (k) of section 351 of 
the Public Health Service Act (42 U.S.C. 262) 
for an eligible drug; 
(ii) maintains at least one domestic estab-
lishment registered under section 510(b) of the 
Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 360(b)) or one foreign establishment 
registered under section 510(i) of such Act that 
is located in a country that is a member of the 
Organisation for Economic Cooperation and 
Development that is capable of manufacturing 
the eligible drug; and 
(iii) has a strong record of good manufac-
turing practices of drugs; 
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(B)(i) is a manufacturer of an active phar-
maceutical ingredient for an eligible drug, in 
partnership with an entity that meets the re-
quirements of subparagraph (A); 
(ii) maintains at least one domestic estab-
lishment registered under section 510(b) of the 
Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 360(b)) or one foreign establishment 
registered under section 510(i) of such Act that 
is located in a country that is a member of the 
Organisation for Economic Cooperation and 
Development that is capable of manufacturing 
the active pharmaceutical ingredient; and 
(iii) has a strong record of good manufac-
turing practices of active pharmaceutical ingre-
dients; or 
(C) is a distributor or wholesaler of an eli-
gible drug, in partnership with an entity that 
meets the requirements of subparagraph (A). 
(f) REPORTS TO CONGRESS.—Not later than 2 years 
after the date on which the first award is made under this 
section, and every 2 years thereafter, the Secretary shall 
submit a report to Congress detailing— 
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(1) the list of drugs determined to be eligible 
drugs, as described in subsection (e)(2), and the ra-
tionale behind selecting each such drug; and 
(2) an update on the effectiveness of the pro-
gram under this section, in a manner that does not 
compromise national security. 
(g) AUTHORIZATION OF APPROPRIATIONS.—To carry 
out this section, there is authorized to be appropriated 
$500,000,000 for fiscal year 2024. 
SEC. 3. GAO REPORT. 
Not later than 18 months after the date of enactment 
of this Act, the Comptroller General of the United States 
shall— 
(1) examine, such as through a survey or other 
means, excess or underutilized domestic manufac-
turing capacity for critical drugs and active pharma-
ceutical ingredients of such drugs, including capacity 
to manufacture different dosage forms, such as oral 
tablets and sterile injectable drugs, and the capacity 
to manufacture drugs with various characteristics, 
such as cytotoxic drugs and drugs requiring 
lyophilization; and 
(2) prepare and submit a report to the Com-
mittee on Homeland Security and Governmental Af-
fairs and the Committee on Health, Education, 
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Labor, and Pensions of the Senate and the Com-
mittee on Homeland Security and the Committee on 
Energy and Commerce of the House of Representa-
tives that— 
(A) includes— 
(i) the results of the survey under 
paragraph (1); 
(ii) an assessment of projected costs 
of utilizing and expanding existing domes-
tic manufacturing capabilities and policies, 
as of the date of the report, that may help 
establish or strengthen domestic manufac-
turing capacity for key starting materials, 
excipients, active pharmaceutical ingredi-
ents, and finished dosage manufacturing 
establishments; and 
(iii) an evaluation of policies designed 
to invest in advanced domestic manufac-
turing capabilities and capacity for critical 
active pharmaceutical ingredients and drug 
products; and 
(B) shall be publicly available in an unclas-
sified form, but may include a classified annex 
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containing any information that the Comp-
troller General determines to be sensitive. 
Æ 
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