A bill to ensure that rules for the approval of pharmaceutical and biological products do not require violations of medical ethics in the testing of products in humans and vertebrate animals.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Ethical Pathway Act of 2010''.

SEC. 2. ETHICAL PATHWAY FOR THE APPROVAL AND LICENSOR OF PHARMACEUTICAL 
              AND BIOLOGICAL PRODUCTS.

    (a) Definitions.--
            (1) In general.--In this section:
                    (A) Applicant.--The term ``applicant'' means a 
                person who submits to the Secretary an application 
                described in subsection (a)(2).
                    (B) Commissioner.--The term ``Commissioner'' means 
                the Commissioner of Food and Drugs.
                    (C) Regulatory test data.--The term ``regulatory 
                test data'' means the evidence regarding the safety and 
                efficacy of new pharmaceutical drugs or biological 
                products used in order to obtain marketing approval for 
                use in humans or vertebrate animals.
                    (D) Relevant application or license.--The term 
                ``relevant application or license'' means a new drug 
                application or new biological product license 
                application approved by the Secretary or relevant 
                authority in a foreign country which contains 
                regulatory test data requested by an applicant under 
                this section.
                    (E) Secretary.--The term ``Secretary'' means the 
                Secretary of Health and Human Services.
            (2) Types of applications.--An application described in 
        this paragraph is--
                    (A) an abbreviated new drug application submitted 
                under section 505(j) of the Federal Food, Drug, and 
                Cosmetic Act (21 U.S.C. 355(j));
                    (B) an application for license of a biosimilar 
                biological product submitted under section 351(k) of 
                the Public Health Service Act; or
                    (C) an application for a license to sell a drug in 
                the United States that has been approved for marketing 
                in a foreign country, as permitted by the Secretary.
    (b) Ethical Pathway.--As soon as practicable after the date of 
enactment of this Act, the Secretary, acting through the Commissioner, 
shall establish a mechanism by which an applicant may request a cost-
sharing arrangement described in subsection (c). Such an applicant may 
request such an arrangement if, but for the arrangement--
            (1) such applicant would be required to conduct clinical 
        investigations involving human subjects that violate Article 20 
        of the Declaration of Helsinki on Ethical Principles for 
        Medical Research Involving Human Subjects in order to obtain 
        approval or licensure from the Secretary of the application 
        described in subsection (a)(2) submitted by the applicant; or
            (2) the duplication of the clinical investigations required 
        for such application would violate other applicable ethical 
        standards concerning the testing of products on humans or other 
        vertebrate animals.
    (c) Cost-Sharing Arrangement.--
            (1) Responsibility of applicant.--An applicant that intends 
        to perform clinical investigations involving humans or 
        vertebrate animals in order to file an application described in 
        subsection (a)(2) shall take all necessary measures to verify 
        that those investigations have not been performed or initiated 
        by another person.
            (2) Voluntary agreement procedures.--
                    (A) In general.--An applicant and the holder or 
                holders of relevant applications or licenses shall make 
                every effort to ensure that any regulatory test data 
                and results of clinical investigations involving humans 
                and vertebrate animals conducted with respect to such 
                relevant applications or licenses is shared with the 
                applicant, including the regulatory test data necessary 
                for the applicant to obtain marketing approval from the 
                Secretary with respect to an application described 
                under subsection (a)(2).
                    (B) Reasonable fee.--
                            (i) In general.--An applicant and the 
                        holder or holders of the relevant applications 
                        or licenses shall make every effort to agree 
                        upon a fee that is reasonable and fair that 
                        permits the applicant to rely upon information 
                        from the regulatory test data referred to in 
                        subparagraph (A).
                            (ii) Limited to certain data.--Clause (i) 
                        shall apply only to the regulatory test data 
                        that such applicant is required to submit with 
                        the application described in subsection (a)(2), 
                        and upon which such applicant does not have the 
                        right to rely in the absence of a license or a 
                        cost-sharing agreement.
            (3) Failure to reach voluntary agreement.--
                    (A) Notification to commissioner.--The applicant 
                shall notify the Commissioner or the appropriate 
                designee of the Commissioner--
                            (i) if the applicant or the holder or 
                        holders of the relevant applications or 
                        licenses refuses to participate in the efforts 
                        to agree upon a fee described in paragraph 
                        (2)(B); or
                            (ii) if the applicant and the holder or 
                        holders of the relevant applications or 
                        licenses fail to reach agreement on a 
                        reasonable and fair fee for reliance by the 
                        applicant on the regulatory test data described 
                        in paragraph (2).
                    (B) Effect of notification.--Upon receipt of a 
                notification under subparagraph (A), the Commissioner 
                or such designee--
                            (i) shall refer the matter to binding 
                        arbitration to determine a reasonable and fair 
                        fee for the reliance by the applicant on the 
                        regulatory test data, and encourage the parties 
                        to participate in such arbitration; or
                            (ii) if 1 or more of the parties refuses to 
                        participate in such arbitration, or if 
                        determined appropriate by the Commissioner, 
                        shall determine a reasonable and fair fee for 
                        the reliance by the applicant on such 
                        regulatory test data.
            (4) Reliance on regulatory test data in application.--If 
        the applicant or the holder or holders of the relevant 
        applications or licenses refuses to participate in the efforts 
        to agree upon a fee described in paragraph (2)(B), or if an 
        applicant and the holder or holders of the relevant 
        applications or licenses fail to reach agreement on a 
        reasonable and fair fee for reliance by the applicant on the 
        regulatory test data under paragraph (2)--
                    (A) the applicant shall--
                            (i) pay to the holder or holders of such 
                        relevant applications or licenses a fee in the 
                        amount of the reasonable and fair share of the 
                        costs of the regulatory test data determined 
                        through binding arbitration or by the 
                        Commissioner or appropriate designee under 
                        paragraph (3), as applicable; and
                            (ii) in the application described in 
                        subsection (a)(2) that is submitted by the 
                        applicant, include a notification to the 
                        Commissioner that the Commissioner shall 
                        incorporate into the application the regulatory 
                        test data contained in such relevant 
                        applications or licenses that is the subject of 
                        the reasonable and fair fee; and
                    (B) subject to the payment of the fee described in 
                subparagraph (A)(i), the Commissioner shall incorporate 
                into the application such regulatory test data.
    (d) Procedures.--The reasonable and fair fee for the reliance by 
the application on the regulatory test data under subsection (c)(3) 
shall be determined after considering the following factors:
            (1) The actual out-of-pocket costs of the applicable 
        clinical investigations.
            (2) The risks of the investigations, as reflected in the 
        probabilities that similar investigations result in successful 
        applications for marketing.
            (3) Any Federal grants, tax credits, or other subsidies 
        that reduce the net cost of the investigations.
            (4) The expected share of the global market for the product 
        involved, by the party seeking to rely upon the investigations 
        for marketing approval.
            (5) The amount of the time the holder or holders of the 
        relevant applications or licenses has benefitted from exclusive 
        rights, and the cumulative revenue earned on the products that 
        relied upon the regulatory test data at issue.
    (e) Public Disclosure.--
            (1) In general.--In order to enhance the transparency of 
        the costs of innovation, and to provide greater predictability 
        as to the liability associated with nonvoluntary reliance upon 
        regulatory test data, the Secretary shall adopt procedures and 
        rules under which sufficient information about the costs and 
        fees will be made public by the arbitrator or the Commissioner 
        (or the appropriate designee of the Commissioner), as 
        applicable.
            (2) Content.--The information made public under paragraph 
        (1) shall include at least summary data of the actual costs of 
        the clinical investigations, the factors considered under 
        subsection (d), and the amount of the fee provided to the 
        holder or holders of the relevant applications or licenses.
            (3) Limitations.--The requirements for public disclosure of 
        the costs of the clinical investigations shall not apply to 
        cases where the owner of the rights in the regulatory test data 
        does not assert an exclusive right to rely upon such test data. 
        If the owner of the rights in the regulatory test data asserts 
        an exclusive right, but reaches a voluntary agreement on the 
        fee for relying upon the data under subsection (c)(2), the 
        amount of the fee paid by the applicant shall be provided to 
        the Secretary or a designee, and be made public.

Summary: Ethical Pathway Act of 2010 - Directs the Secretary of Health and Human Services (HHS), acting through the Commissioner of Food and Drugs (FDA), to establish a mechanism by which an applicant for an abbreviated new drug application submitted under the Federal Food, Drug, and Cosmetic Act, for license of a biosimilar biological product submitted under the Public Health Service Act, or for a license to sell in the United States a drug that has been approved for marketing in a foreign country may request a cost-sharing arrangement under which the applicant and the holders of relevant applications or licenses shall make every effort to ensure that any regulatory test data and results of clinical investigations involving humans and vertebrate animals conducted regarding such applications or licenses is shared, including the regulatory test data necessary to obtain marketing approval from the Secretary.

Permits such applicant to request such arrangement if, but for the arrangement: (1) the applicant would be required to conduct clinical investigations involving human subjects that violate Article 20 of the Declaration of Helsinki on Ethical Principles for Medical Research Involving Human Subjects in order to obtain the Secretary's approval or licensure; or (2) the duplication of the clinical investigations required for such application would violate other applicable ethical standards concerning the testing of products on humans or other vertebrate animals.

Sets forth provisions regarding: (1) the responsibility of an applicant that intends to perform clinical investigations involving humans or vertebrate animals to verify that those investigations have not been performed or initiated by another person, (2) agreement between an applicant and the holders of the relevant applications or licenses on a fee that is reasonable and fair that permits the applicant to rely upon information from such regulatory test data, and (3) procedures to determine such fee or required payment when such parties fail to reach such an agreement.

Requires the fee for reliance on such regulatory test data to be determined after considering: (1) the actual out-of-pocket costs of the applicable clinical investigations; (2) the risks of the investigations; (3) any federal grants, tax credits, or other subsidies; (4) the expected share of the global market for the product involved; and (5) the amount of time the holders of the relevant applications or licenses have benefited from exclusive rights and the cumulative revenue earned on the products that relied upon the data at issue. Directs the Secretary to adopt procedures and rules under which sufficient information about costs and fees will be made public.