American Made Pharmaceuticals Act of 2022
Bill: S.3991 | Sponsor: Sen. Smith, Tina (D-MN)
Policy area: Health

Summary:
American Made Pharmaceuticals Act of 2022
This bill requires the Centers for Medicare & Medicaid Services to conduct a demonstration program that gives preference to domestically manufactured drugs under Medicare, Medicaid, and the Children's Health Insurance Program (CHIP).
The program must be conducted in at least eight states and for at least seven years. Applicable drugs include critical drugs that are needed to respond to a public health emergency and that have a vulnerable global supply chain. Preference may take the form of reduced cost-sharing, preferential treatment on formularies, bonus payments, and other specified methods.

To direct the Secretary of Health and Human Services to conduct a 
 demonstration program to test providing preferential treatment under 
    the Medicare, Medicaid, and CHIP programs for certain drugs and 
             biologicals manufactured in the United States.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``American Made Pharmaceuticals Act of 
2022''.

SEC. 2. DEMONSTRATION PROGRAM TO TEST PROVIDING PREFERENTIAL TREATMENT 
              UNDER THE MEDICARE, MEDICAID, AND CHIP PROGRAMS FOR 
              CERTAIN DRUGS AND BIOLOGICALS MANUFACTURED IN THE UNITED 
              STATES.

    Part A of title XI of the Social Security Act (42 U.S.C. 1301 et 
seq.) is amended by inserting after section 1150C the following:

``SEC. 1150D. DEMONSTRATION PROGRAM TO TEST PROVIDING PREFERENTIAL 
              TREATMENT UNDER THE MEDICARE, MEDICAID, AND CHIP PROGRAMS 
              FOR CERTAIN DRUGS AND BIOLOGICALS MANUFACTURED IN THE 
              UNITED STATES.

    ``(a) In General.--Not later than 1 year after the date of 
enactment of this section, the Secretary shall conduct a demonstration 
program (in this section referred to as the `Program') under which U.S. 
manufactured drugs are given preference under titles XVIII, XIX, and 
XXI compared to drugs that are not U.S. manufactured drugs through the 
use of applicable tools.
    ``(b) Sites.--The Program shall be conducted in at least 8 States.
    ``(c) Duration.--The Secretary shall conduct the Program for a 
period of not less than 7 years.
    ``(d) Definitions.--In this section:
            ``(1) Applicable drug.--The term `applicable drug' means--
                    ``(A) a drug that is approved and marketed under 
                section 505(j) of the Federal Food, Drug, and Cosmetic 
                Act;
                    ``(B) a biological product that is licensed and 
                marketed under section 351(k) of the Public Health 
                Service Act; or
                    ``(C) a critical drug.
            ``(2) Applicable u.s.-based pharmaceutical company.--The 
        term `applicable U.S.-based pharmaceutical company' means a 
        manufacturer (as defined in section 1860D-14A(g)(5))--
                    ``(A) that has a manufacturing location in the 
                United States for an applicable drug;
                    ``(B) beginning 3 years after the date of the 
                implementation of the Program, for which at least 50 
                percent of the starter products, by weight, for the 
                applicable drugs manufactured by manufacturer are 
                derived from countries other than covered nations (as 
                defined in section 4871(d)(2) of title 10, United 
                States Code); and
                    ``(C) that, as determined by the Secretary--
                            ``(i) maintains an appropriate level of 
                        transparency on locations of manufacturing;
                            ``(ii) maintains an appropriate level of 
                        diversity in sourcing;
                            ``(iii) maintains appropriate levels of 
                        inventory and emergency reserves;
                            ``(iv) has in place an appropriate action 
                        plan for increases in demand and for when links 
                        in the supply chain break down; and
                            ``(v) meets any other characteristics the 
                        Secretary determines appropriate.
            ``(3) Applicable tools.--The term `applicable tools' means 
        tools determined appropriate by the Secretary, such as--
                    ``(A) preferential treatment on a formulary;
                    ``(B) providing lower cost-sharing;
                    ``(C) waiving rebates under the Medicaid program 
                under title XIX;
                    ``(D) establishing a Medicare Star Rating under 
                part D of title XVIII; or
                    ``(E) providing bonus payments to providers of 
                services and suppliers under part B of title XVIII.
            ``(4) Critical drug.--In this section, the term `critical 
        drug' includes the following:
                    ``(A) A medicine, medical countermeasure, or 
                critical input identified on the list under section 
                3(c) of Executive Order 13944 of August 6, 2020 (85 
                Red. Reg 49929; relating to essential medicines, 
                medical Countermeasures, and critical inputs).
                    ``(B) A drug or biological that--
                            ``(i) is not described in subparagraph (A);
                            ``(ii) is approved and marketed under 
                        section 505(c) of the Federal Food, Drug, and 
                        Cosmetic Act or is licensed and marketed under 
                        section 351(a) of the Public Health Service Act 
                        (or is an active pharmaceutical ingredient of 
                        such a drug or biological);
                            ``(iii) the Secretary determines--
                                    ``(I) is--
                                            ``(aa) likely to be needed 
                                        for use in a public health 
                                        emergency; or
                                            ``(bb) at high risk of 
                                        short supply; and
                                    ``(II) has a vulnerable global 
                                supply chain.
            ``(5) U.S. manufactured drug.--The term `U.S. manufactured 
        drug' means an applicable drug that is manufactured in the 
        United States by an applicable U.S.-based pharmaceutical 
        company.
    ``(e) Annual Report to Congress.--Not later than 1 year after the 
date the Secretary implements the Program, and annually thereafter for 
as long as the Program is being conducted, the Secretary shall submit 
to Congress a report on activities under the Program, together with 
recommendations for such legislation and administrative action as the 
Secretary determines to be appropriate.
    ``(f) Waivers.--The Secretary may waive such provisions of this 
title and titles XVIII, XIX, and XXI as the Secretary determines 
necessary in order to implement the Program
    ``(g) Administrative Funding.--There is authorized to be 
appropriated to the Secretary such sums as may be necessary for the 
administrative expenses of carrying out the Program, to remain 
available until expended.''.
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