Title: Protecting America’s Life Saving Medicines Act of 2019
Policy area: Taxation

Summary:
Protecting America's Life Saving Medicines Act of 2019
This bill directs the Food and Drug Administration (FDA) to conduct a study on drugs that are currently being tested and are unlikely to be approved, but would, if approved, address an unmet medical need for the treatment of a serious or life threatening disease or condition or a rare disease or condition (high-risk, high-reward drugs). The FDA must submit to the Department of the Treasury a list of such high-risk, high-reward drugs not later than 180 days after the completion of the study.
The bill also allows a new tax credit for 25% of the clinical testing expenses for high-risk, high-reward drugs.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5402 Introduced in House (IH)]

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116th CONGRESS
  1st Session
                                H. R. 5402

 To direct the Secretary of Health and Human Services, acting through 
 the Commissioner of Food and Drugs, to conduct a study on high-risk, 
               high-reward drugs, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           December 11, 2019

  Mr. Gottheimer (for himself and Mr. Upton) introduced the following 
  bill; which was referred to the Committee on Ways and Means, and in 
 addition to the Committee on Energy and Commerce, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL


 
 To direct the Secretary of Health and Human Services, acting through 
 the Commissioner of Food and Drugs, to conduct a study on high-risk, 
               high-reward drugs, and for other purposes.

    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 ``Protecting America's Life Saving 
Medicines Act of 2019''.

SEC. 2. STUDY ON HIGH-RISK, HIGH-REWARD DRUGS.

    (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary of Health and Human Services, 
acting through the Commissioner of Food and Drugs, shall conduct a 
study to determine which of the drugs that are being tested (as of such 
date of enactment) under subsection (i) of section 505 of the Federal 
Food, Drug, and Cosmetic Act (21 U.S.C. 355) are unlikely to be 
approved under subsection (c) of such section, but would, if approved, 
address an unmet medical need for the treatment of a serious or life-
threatening disease or condition or a rare disease or condition.
    (b) Submission to Treasury.--Not later than 180 days after the 
completion of the study under subsection (a), the Secretary of Health 
and Human Services, acting through the Commissioner of Food and Drugs, 
shall transmit to the Secretary of the Treasury (or the Secretary's 
delegate) a list of the drugs that the Secretary of Health and Human 
Services determines meets the criteria specified in subsection (a).

SEC. 3. CREDIT FOR CLINICAL TESTING EXPENSES FOR CERTAIN HIGH-RISK, 
              HIGH-REWARD DRUGS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45T. CLINICAL TESTING EXPENSES FOR CERTAIN HIGH-RISK, HIGH-
              REWARD DRUGS.

    ``(a) In General.--For purposes of section 38, the credit 
determined under this section for the taxable year is an amount equal 
to 25 percent of the qualified clinical testing expenses for the 
taxable year.
    ``(b) Qualified Clinical Testing Expenses.--For purposes of this 
section--
            ``(1) Qualified clinical testing expenses.--
                    ``(A) In general.--Except as otherwise provided in 
                this paragraph, the term `qualified clinical testing 
                expenses' means the amounts which are paid or incurred 
                by the taxpayer during the taxable year which would be 
                described in subsection (b) of section 41 if such 
                subsection were applied with the modifications set 
                forth in subparagraph (B).
                    ``(B) Modifications.--For purposes of subparagraph 
                (A), subsection (b) of section 41 shall be applied--
                            ``(i) by substituting `clinical testing' 
                        for `qualified research' each place it appears 
                        in paragraphs (2) and (3) of such subsection, 
                        and
                            ``(ii) by substituting `100 percent' for 
                        `65 percent' in paragraph (3)(A) of such 
                        subsection.
                    ``(C) Exclusion for amounts funded by grants, 
                etc.--The term `qualified clinical testing expenses' 
                shall not include any amount to the extent such amount 
                is funded by any grant, contract, or otherwise by 
                another person (or any governmental entity).
            ``(2) Clinical testing.--The term `clinical testing' means 
        any human clinical testing--
                    ``(A) which is carried out with respect to a drug 
                on a list submitted to the Secretary under subsection 
                (b) of the Protecting America's Life Saving Medicines 
                Act of 2019,
                    ``(B) which occurs--
                            ``(i) after the date such list is so 
                        submitted, and
                            ``(ii) before the date on which an 
                        application with respect to such drug is 
                        approved under section 505(b) of such Act or, 
                        if the drug is a biological product, before the 
                        date on which a license for such drug is issued 
                        under section 351 of the Public Health Service 
                        Act.
    ``(c) Coordination With Credit for Increasing Research 
Expenditures.--
            ``(1) In general.--Except as provided in paragraph (2), any 
        qualified clinical testing expenses for a taxable year to which 
        an election under this section applies shall not be taken into 
        account for purposes of determining the credit allowable under 
        section 41 for such taxable year.
            ``(2) Expenses included in determining base period research 
        expenses.--Any qualified clinical testing expenses for any 
        taxable year which are qualified research expenses (within the 
        meaning of section 41(b)) shall be taken into account in 
        determining base period research expenses for purposes of 
        applying section 41 to subsequent taxable years.
    ``(d) Special Rules.--
            ``(1) Certain rules made applicable.--Rules similar to the 
        rules of paragraphs (1) and (2) of section 41(f) shall apply 
        for purposes of this section.
            ``(2) Election.--This section shall apply to any taxpayer 
        for any taxable year only if such taxpayer elects (at such time 
        and in such manner as the Secretary may by regulations 
        prescribe) to have this section apply for such taxable year.''.
    (b) Credit Made Part of General Business Credit.--Subsection (b) of 
section 38 of the Internal Revenue Code of 1986 is amended by striking 
``plus'' at the end of paragraph (31), by striking the period at the 
end of paragraph (32) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(33) the credit determined under section 45T.''.
    (c) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of such Code is amended by adding 
at the end the following new item:

``Sec. 45T. Clinical testing expenses for certain high-risk, high-
                            reward drugs.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
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