Orphan Drug Act Amendments of 1994

SECTION 1. SHORT TITLE AND REFERENCE.

    (a) Short Title.--This Act may be cited as the ``Orphan Drug Act 
Amendments of 1994 ''.
    (b) Reference.--Whenever in this Act (other than sections 5 and 6) 
an amendment or repeal is expressed in terms of an amendment to, or 
repeal of, a section or other provision, the reference shall be 
considered to be made to a section or other provision of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 201 et seq.).

SEC. 2. PERIOD OF EXCLUSIVITY.

    (a) Initial Period.--Subsection (a) of section 527 (21 U.S.C. 
360cc) is amended--
            (1) by inserting ``(1)'' after ``(a)'';
            (2) by redesignating paragraphs (1), (2), and (3) as 
        subparagraphs (A), (B), and (C), respectively;
            (3) by striking ``seven years'' and inserting ``4 years''; 
        and
            (4) by striking ``505(c)(2)'' and inserting 
        ``505(c)(1)(B)''.
    (b) Additional Period.--Subsection (a) of section 527 (21 U.S.C. 
360cc) (as amended by subsection (a)) is amended by adding at the end 
the following new paragraphs:
    ``(2) The holder of the approved application, certification, or 
license of a drug to which the 4-year period of exclusivity applies 
under paragraph (1) may, after the expiration of 3\1/2\ years of such 
period but not later than 90 days before the expiration of such period, 
apply to the Secretary for a 3-year extension of such period. Such an 
application shall contain such information as the Secretary determines 
is necessary to evaluate such application.
    ``(3) The Secretary shall approve an application submitted under 
paragraph (2) if the applicant--
            ``(A) demonstrates that the drug has a limited commercial 
        potential as determined under regulations of the Secretary, 
        taking into account sales information respecting such drug and 
        any other factor identified by the Secretary in such 
        regulations that is relevant to the commercial potential of 
        such drug, and
            ``(B) makes such demonstration on the basis of the 
        regulations of the Secretary referred to in subparagraph (A) 
        that were in effect--
                    ``(i) on the date--
                            ``(I) such drug received its designation 
                        under section 526(a), or
                            ``(II) such applicant applied for an 
                        exemption for such drug under section 505(i) or 
                        507(d),
                whichever first occurs, or
                    ``(ii) if the date under clause (i) occurred before 
                the date such regulations were in effect, on the date 
                such regulations were in effect.''.
    (c) Conforming Amendment.--Section 527(b) (21 U.S.C. 360cc(b)) is 
amended--
            (1) by striking ``during the seven-year period beginning on 
        the date of the application approval'' and inserting ``during 
        the applicable period of exclusivity under subsection (a)''; 
        and
            (2) by striking ``such seven year period'' and inserting 
        ``the applicable period of exclusivity under subsection (a)''.
    (d) Effective Date.--The amendments made by subsections (a) and (b) 
shall not apply to a drug--
            (1) for which an application under section 505 or 507 of 
        the Federal Food, Drug, and Cosmetic Act or section 351 of the 
        Public Health Service Act was submitted before March 1, 1994; 
        or
            (2) for which an exemption under section 505(i) or 507(d) 
        of the Federal Food, Drug, and Cosmetic Act was in effect 
        before March 1, 1994, for which human clinical trials were 
        actively being conducted before such date, and for which an 
        application for designation under section 526 of such Act was 
        submitted before the date of enactment of the Orphan Drug Act 
        Amendments of 1994.
The 7 year period of exclusivity provided by section 527(a) of the 
Federal Food, Drug, and Cosmetic Act before the date of the enactment 
of this Act shall, after such date, apply to a drug described in 
paragraph (1) or (2).
    (e) Regulations.--The Secretary shall issue final regulations to 
implement paragraphs (2) and (3) of section 527(a) of the Federal Food, 
Drug, and Cosmetic Act (21 U.S.C. 360cc) (as amended by subsection (b)) 
not later than 6 months after the date of the enactment of this Act.

SEC. 3. DESIGNATIONS.

    (a) In General.--Section 526(a)(2) (21 U.S.C. 360bb(a)(2)) is 
amended to read as follows:
    ``(2) For purposes of paragraph (1), the term `rare disease or 
condition' means any disease or condition that--
            ``(A) affects fewer than 200,000 persons in the United 
        States determined on the basis of--
                    ``(i) the facts and circumstances as of the date 
                the request for designation of the drug under this 
                subsection is made, and
                    ``(ii) projections as to the number of persons who 
                will be affected by the disease or condition on a date 
                which is 3 years from date such request was made, or
            ``(B) affects more than 200,000 persons in the United 
        States and for which there is no reasonable expectation that 
        the cost of developing and making available in the United 
        States a drug for such disease or condition will be recovered 
        from sales in the United States of such drug.''.
    (b) Exclusivity.--Section 527(b) (21 U.S.C. 360cc(b)) is amended--
            (1) in paragraph (1), by striking ``or'' at the end of such 
        paragraph;
            (2) by striking the period at the end of paragraph (2) and 
        inserting ``; or'', and
            (3) by adding at the end the following new paragraph:
            ``(3) a drug has been designated under section 526 for a 
        rare disease or condition described in section 526(a)(2)(A) and 
        if after such designation it is determined that--
                    ``(A) such disease or condition affects more than 
                200,000 persons in the United States; and
                    ``(B) such drug does not meet the requirement of 
                section 526(a)(2)(B).''.

SEC. 4. SIMULTANEOUS DEVELOPMENT.

    (a) In General.--Section 527(b) (21 U.S.C. 360cc(b)), as amended by 
section 3(b), is amended by--
            (1) inserting ``(1)'' after ``(b)'';
            (2) by redesignating paragraphs (1), (2), and (3) as 
        subparagraphs (A), (B), and (C), respectively;
            (3) by striking ``for a person who is not'' and inserting 
        ``for an applicant who is not''; and
            (4) by adding at the end the following new subparagraphs:
            ``(D) the Secretary finds, after providing the holder, such 
        applicant, and any other interested person an opportunity to 
        present their views, that the drugs of the holder and such 
        applicant were developed simultaneously.
The Secretary shall make a decision on a request for a finding under 
subparagraph (D) not later than 60 days after the filing of the 
request.
    ``(2) For purposes of paragraph (1)(D), drugs of a holder and an 
applicant shall be considered to be developed simultaneously only if--
            ``(A) the applicant requested that its drug be designated 
        under section 526 not later than 6 months after publication of 
        the designation under section 526(c) of the holder's drug;
            ``(B) the applicant initiated the human clinical trials 
        that the applicant relied on in its application for such 
        approval, certification, or license not more than 12 months 
        after the date the holder initiated the human clinical trials 
        that the holder relied on in its application for such approval, 
        certification, or license; and
            ``(C) the applicant submitted such application, including 
        the reports of the clinical and animal studies necessary for 
        approval, certification, or licensing, not more than 12 months 
        after the holder submitted its application, including such 
        reports, for such action.
    ``(3) Paragraph (1)(D) does not apply to a drug--
            ``(A) for which an application under section 505 or 507 or 
        section 351 of the Public Health Service Act was submitted 
        before March 1, 1994; or
            ``(B) for which an exemption under section 505(i) or 507(d) 
        was in effect before March 1, 1994, for which human clinical 
        trials were actively being conducted before such date, and for 
        which an application for designation under section 526 was 
        submitted before the date of enactment of the Orphan Drug Act 
        Amendments of 1994.''.
    (b) Publication.--Section 526(c) (21 U.S.C. 360bb(c)) is amended--
            (1) by inserting ``for a rare disease or condition'' after 
        ``(a)''; and
            (2) by striking ``shall be made available to the public'' 
        and inserting ``shall be promptly published in the Federal 
        Register and otherwise made available to the public in a manner 
        designed to notify persons who have such disease or 
        condition''.

SEC. 5. OFFICE FOR ORPHAN DISEASES AND CONDITIONS.

    Section 227 of the Public Health Service Act (42 U.S.C. 236) is 
amended--
            (1) in subsection (a), to read as follows:
    ``(a) There is established in the Department of Health and Human 
Services an Office for Orphan Diseases and Conditions. Such Office 
shall be established at a level within the Department with sufficient 
authority to assure full implementation of the functions and 
responsibilities established by this section.'';
            (2) by striking ``Board'' each place the term appears and 
        inserting ``Office'';
            (3) in subsection (b), by striking ``drugs and devices'' 
        and inserting ``drugs, devices, and medical foods'';
            (4) in subsection (c)(1)(A), by inserting ``of chapter V'' 
        after ``subchapter B'';
            (5) by adding at the end the following new subsection:
    ``(f)(1) There is established in the Office an advisory committee 
to advise the Office in carrying out the functions of the Office under 
this section.
    ``(2) The advisory committee shall be comprised of 11 members 
appointed by the Secretary, in consultation with the Office and the 
Commissioner of the Food and Drug Administration, from persons 
knowledgeable about rare diseases and conditions, including--
            ``(A) 5 representatives of organizations of persons with 
        rare diseases or conditions;
            ``(B) 3 research scientists; and
            ``(C) 3 representatives of health-related companies.
    ``(3) The Secretary shall also appoint, as liaisons to the advisory 
committee, individuals from the Food and Drug Administration, the 
National Institutes of Health, and other appropriate Federal agencies.
    ``(4) Vacancies occurring in the membership of the advisory 
committee shall be filled in the same manner as the original 
appointment for the position being vacated. Vacancies shall not affect 
the power of the remaining members to execute the duties of the 
advisory committee.
    ``(5) Members of the advisory committee, and liaisons to the 
advisory committee, shall not be compensated, but shall receive travel 
expenses, including per diem in lieu of subsistence, at rates 
authorized for employees of agencies under subchapter 1 of chapter 57 
of title 5, United States Code, for each day the member or liaison is 
engaged in the performance of duties away from the home or regular 
place of business of the member or liaison.
    ``(6) Notwithstanding section 1342 of title 31, United States Code, 
the advisory committee may accept the voluntary services provided by a 
member of the advisory committee or a liaison to the advisory 
committee.''; and
            (6) by amending the section heading to read as follows:

             ``office for orphan diseases and conditions''.

SEC. 6. AUTHORIZATION FOR ORPHAN DRUG ACT.

    Section 5(c) of the Orphan Drug Act (21 U.S.C. 360ee(c)) is amended 
by striking ``$10,000,000'' and all that follows and inserting 
``$20,000,000 for fiscal year 1995, $25,000,000 for fiscal year 1996, 
and $30,000,000 for fiscal year 1997.''.

Summary: Orphan Drug Act Amendments of 1994 - Amends the Federal Food, Drug, and Cosmetic Act to change from seven to four years the period of market exclusivity guaranteed to any approved orphan drug.  Specifies that orphan drugs of "limited commercial potential," as defined by regulations to be issued by the Department of Health and Human Services, would qualify for an additional three years of exclusive marketing rights. 
Permits more than one company to put a particular orphan drug on the market in instances where both companies were working on the drug in roughly the same time frame. 
Provides for the withdrawal of exclusive marketing rights if the patient population for the approved treatment exceeds 200,000. Extends the authorization of the research grant program.  Replaces the existing Orphan Products Board with an Office for Orphan Diseases and Conditions.