Title: Faster Treatments and Cures for Eye Diseases Act
Policy area: Health

Summary:
Faster Treatments and Cures for Eye Diseases Act
This bill requires the Department of Health and Human Services to establish a pilot program that provides for a partial federal guarantee of specified bonds, the sale of which shall finance promising translational vision-impairment research with private investment. The Government Accountability Office must study this program and consider whether similar programs should be established for other areas of biomedical research.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2620 Introduced in House (IH)]

<DOC>






116th CONGRESS
  1st Session
                                H. R. 2620

    To advance treatment and cures for blindness and other retinal 
conditions and to promote competitiveness in the United States through 
a pilot program to increase funding for translational research, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 9, 2019

  Mr. Bishop of Georgia (for himself, Mrs. Rodgers of Washington, Mr. 
     Bilirakis, Mr. Cohen, Mr. O'Halleran, Mr. Schneider, and Mr. 
 Fitzpatrick) introduced the following bill; which was referred to the 
                    Committee on Energy and Commerce

_______________________________________________________________________

                                 A BILL


 
    To advance treatment and cures for blindness and other retinal 
conditions and to promote competitiveness in the United States through 
a pilot program to increase funding for translational research, 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 ``Faster Treatments and Cures for Eye 
Diseases Act''.

SEC. 2. DEFINITIONS.

    For purposes of this Act:
            (1) Applicable congressional committees.--The term 
        ``applicable congressional committees'' means the Committees on 
        Energy and Commerce and Financial Services of the House of 
        Representatives and the Committees on Banking, Housing, and 
        Urban Affairs and Health, Education, Labor, and Pensions of the 
        Senate.
            (2) Appropriate federal banking agency.--The term 
        ``appropriate Federal banking agency'' has the meaning given 
        that term in section 3 of the Federal Deposit Insurance Act (12 
        U.S.C. 1813).
            (3) Cost.--The term ``cost'' has the meaning given to the 
        term ``cost of a loan guarantee'' in section 502(5)(C) of the 
        Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5)(C)).
            (4) Depository institution; depository institution holding 
        company.--The term ``depository institution'' and ``depository 
        institution holding company'' have the meaning given those 
        terms under section 3 of the Federal Deposit Insurance Act (12 
        U.S.C. 1813).
            (5) Eye bond.--The term ``eye bond'' means a bond--
                    (A) issued by an issuer pursuant to this Act;
                    (B) the proceeds of which are used to fund projects 
                selected under section 6(b)(1), except as otherwise 
                described in this Act; and
                    (C) that complies with the regulations issued under 
                section 4.
            (6) Funded project.--The term ``funded project'' means a 
        translational research project that is selected to be funded 
        using the proceeds of an eye bond.
            (7) Guarantee.--The term ``guarantee'' has the meaning 
        given to the term ``loan guarantee'' in section 502 of the 
        Federal Credit Reform Act of 1990 (2 U.S.C. 661a) and includes 
        a loan guarantee commitment (as defined in such section 502).
            (8) Issuer.--The term ``issuer'' means an entity that--
                    (A) is a depository institution, a depository 
                institution holding company, or a broker or dealer 
                registered with the Securities and Exchange Commission;
                    (B) complies with the schedule for the issuance of 
                eye bonds established under section 3(c); and
                    (C) complies with the regulations issued under 
                section 5.
            (9) Program.--The term ``Program'' means the Eye Bond Pilot 
        Program established under section 3.
            (10) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services, except in references to the 
        Secretary of the Treasury.
            (11) State.--The term ``State'' means--
                    (A) each State of the United States;
                    (B) the District of Columbia;
                    (C) the Commonwealth of Puerto Rico; and
                    (D) any other territory or possession of the United 
                States.
            (12) Translational research.--The term ``translational 
        research''--
                    (A) means any research project that is designed to 
                cure vision blindness and any conditions attendant to 
                vision impairment that are, as determined by the 
                Director of the National Eye Institute, congenital to 
                the vision impairment and not incidental to vision 
                impairment or caused by vision impairment;
                    (B) includes projects designed to cure--
                            (i) hearing impairment genetically linked 
                        to vision impairment, such as Usher Syndrome;
                            (ii) retinal degenerative diseases such as 
                        retinitis pigmentosa, macular degeneration, and 
                        Usher Syndrome;
                            (iii) vision trauma due to injury such as 
                        that experienced by wounded veterans;
                            (iv) glaucoma;
                            (v) optic nerve disorders that result in 
                        vision impairment or blindness, such as morning 
                        glory syndrome; and
                            (vi) diabetic reinopathy; and
                    (C) subject to subparagraph (B)(vi), does not 
                include projects designed to cure any underlying 
                disease or condition whose symptoms may include vision 
                impairment, such as diabetes.

SEC. 3. EYE BOND PILOT PROGRAM.

    (a) Establishment.--Not earlier than 1 year after the date of 
enactment of this Act, the Secretary, in consultation with the 
Secretary of the Treasury and the appropriate Federal banking agencies, 
shall establish a pilot program to be known as the Eye Bond Pilot 
Program under which--
            (1) the Director of the National Eye Institute shall, in 
        accordance with section 6, select translational research 
        projects to be funded by eye bonds; and
            (2) the Secretary shall--
                    (A) provide a partial Federal guarantee of the eye 
                bonds;
                    (B) contract with an issuer to issue the eye bonds; 
                and
                    (C) use the proceeds from the sale of the eye bonds 
                to fund the selected projects and to pay for other 
                related expenses, as permitted by this Act.
    (b) Federal Guarantee.--
            (1) In general.--The Secretary shall guarantee the payment 
        of principal (but not the payment of interest) on an eye bond, 
        on a bond-by-bond basis, in an amount to be determined by the 
        Secretary, but in no case may the amount of such guarantee be 
        more than 50 percent of the principal of the eye bond.
            (2) Prioritization of taxpayer interests.--All eye bonds 
        shall be structured to give first priority to protecting the 
        interests of the United States by ensuring that--
                    (A) all cash proceeds received from the repayment 
                of an eye bond are first used to reduce the amount of 
                principal guaranteed by the Secretary under the terms 
                of the eye bond; and
                    (B) the Secretary has a senior claim on all assets 
                and collateral under the eye bond to the extent the 
                guarantee provided by the Secretary is not 
                extinguished.
            (3) Limitation.--The Secretary may not guarantee--
                    (A) more than $1,000,000,000 for all eye bonds 
                issued pursuant to this Act; and
                    (B) more than $250,000,000 for all eye bonds issued 
                pursuant to this Act in any single fiscal year.
    (c) Issuance Schedule.--The Secretary shall, in consultation with 
the Secretary of the Treasury and issuers, establish a schedule for the 
issuance of eye bonds that ensures that funded projects represent a 
reasonable sample of diverse causes of vision loss.
    (d) Risk-Share Pool.--
            (1) In general.--With respect to an eye bond guaranteed 
        under this section, the Secretary may allow a risk-share pool 
        capitalized by issuers to provide a first-loss guarantee of the 
        principal and interest of such bond, if the Secretary 
        determines that such first-loss guarantee would--
                    (A) be a robust source of protection for the United 
                States, as guarantor of the eye bond, that reduces the 
                cost of the Federal guarantee to the United States;
                    (B) encourage the flow of private sector capital 
                into biomedical translational research;
                    (C) create a prudent incentive for issuers to 
                contribute additional private capital for biomedical 
                translational research; or
                    (D) meet other public interest, safety, and 
                soundness goals.
            (2) Consultation.--In making a determination under 
        paragraph (1), the Secretary shall consult with the Secretary 
        of the Treasury and the appropriate Federal banking agencies.
            (3) Funding.--The cost of contracting with a risk-share 
        pool under this subsection shall be paid from the proceeds from 
        the sale of eye bonds pursuant to the Program.
    (e) Equity Position Option for the Secretary.--
            (1) In general.--With respect to an eye bond issued 
        pursuant to this Act, the Secretary, in consultation with the 
        Secretary of the Treasury and other appropriate parties, 
        including eye bond issuers and investors, may negotiate an 
        equity position for the United States Government in the 
        projects to be funded by such eye bond if the Secretary 
        determines that such an equity position will further the 
        interests of the Program and the United States.
            (2) Limitations.--
                    (A) Supplemental.--Any equity position taken in a 
                project pursuant to paragraph (1) shall be supplemental 
                to, not in lieu of, a guarantee provided by the 
                Secretary with respect to the eye bond funding such 
                project.
                    (B) Total amount.--The total of amount of an eye 
                bond guarantee under this section and any equity 
                position taken by the Secretary in a project funded by 
                such bond that is supplemental to such guarantee shall 
                not exceed 50 percent of the principal amount of the 
                eye bond.
            (3) Notification and consultation.--Prior to finalization 
        of any equity position under paragraph (1), the Secretary shall 
        notify the applicable congressional committees and consult with 
        such committees on the proposed terms of such equity position 
        and whether taking such equity position will further the 
        interests of the Program and the United States.
    (f) Termination of the Program.--
            (1) In general.--Except as provided in paragraph (2), the 
        Program shall terminate on the date that is 6 years after the 
        date of enactment of this Act.
            (2) Early termination.--
                    (A) In general.--The Secretary may terminate the 
                Program before the date described in paragraph (1).
                    (B) Congressional notification.--If the Secretary 
                determines that the Program shall be terminated under 
                subparagraph (A), not later than 60 days before the 
                date on which the termination is effective, the 
                Secretary shall--
                            (i) submit to the applicable congressional 
                        committees a report that includes--
                                    (I) a description of the reasons 
                                for the termination;
                                    (II) any corrective actions that 
                                may be taken; and
                                    (III) any other actions that may be 
                                taken to promote the use of private 
                                capital and to increase the amount of 
                                Federal funds made available to carry 
                                out basic and translational biomedical 
                                research; and
                            (ii) make publicly available the report 
                        described in clause (i).
            (3) Effect on eye bonds issued and federal guarantees.--The 
        termination of the Program shall not affect the validity of--
                    (A) any eye bond issued before the date on which 
                the Program is terminated; or
                    (B) any Federal guarantee under this Act for an eye 
                bond described in subparagraph (A).
    (g) Program Funding.--
            (1) Administrative expenses paid from bond sales.--Except 
        as provided under paragraph (2), the cost of carrying out this 
        Act, including the cost to the Secretary in administering the 
        Program, shall be recovered from the proceeds from the sale of 
        eye bonds pursuant to the Program or from fees as set forth in 
        paragraph (3).
            (2) Specific appropriation or contribution.--No guarantee 
        shall be made under this section unless--
                    (A) an appropriation for the full cost of the 
                guarantee has been made;
                    (B) the Secretary has received from the eye bond 
                issuer a payment in full for the cost of the guarantee; 
                or
                    (C) a combination of an appropriation and the 
                deposit of a payment from the bond issuer into the 
                Treasury has been made in a sufficient amount to cover 
                the full cost of the guarantee.
            (3) Cost of guarantees.--
                    (A) In general.--The Secretary shall charge and 
                collect fees for guarantees under this section in 
                amounts the Secretary determines are sufficient to 
                recover applicable administrative expenses.
                    (B) Availability.--Fees collected under this 
                subsection--
                            (i) shall be deposited by the Secretary 
                        into the Treasury; and
                            (ii) are authorized to remain available 
                        until expended.

SEC. 4. EYE BOND TERMS, CONDITIONS, AND STRUCTURE.

    (a) In General.--Not later than 180 days after the date of 
enactment of this Act, the Secretary, in consultation with the 
Secretary of the Treasury, the Chairman of the Securities and Exchange 
Commission, the heads of the appropriate Federal banking agencies, the 
Director of the National Institutes of Health, and the heads of other 
Federal departments and agencies and other interested parties as the 
Secretary determines appropriate, shall issue regulations to specify 
the terms, conditions, and structure for an eye bond.
    (b) Auctions.--In issuing the regulations under subsection (a)--
            (1) the Secretary may provide for an auction to select the 
        purchasers of eye bonds; and
            (2) any such auction may include a process that minimizes 
        the risk to the Government of the Federal guarantee involved by 
        allowing bidders for an eye bond to compete against each other 
        by bidding on the percentage of the Federal guarantee under 
        section 4(b) with respect to the eye bond, with the bid for the 
        lowest percentage winning the auction, taking into account 
        other terms and conditions set by the issuer to ensure the 
        lowest total cost to the Government.

SEC. 5. EYE BOND ISSUERS.

    (a) Issuer Criteria.--Not later than 180 days after the date of 
enactment of this Act, the Secretary, in consultation with the 
Secretary of the Treasury, shall issue regulations--
            (1) to establish the criteria for selecting issuers;
            (2) to ensure that issuers perform in a manner that ensures 
        the successful issuance of eye bonds that promote biomedical 
        translational research in the United States; and
            (3) to ensure that issuers use sound underwriting practices 
        that protect the interests of--
                    (A) the United States;
                    (B) eye bond investors; and
                    (C) the long-term promotion of translational 
                research for vision impairment and other diseases, 
                disabilities, and syndromes congenital to vision 
                impairment or caused by vision impairment, taking into 
                account features that are valuable after any 
                authorization for expanded use of a limited Federal 
                guarantee for biomedical translational research for 
                other diseases and disabilities.
    (b) Compensation for Issuers.--The issuer of an eye bond shall be 
compensated from the proceeds from the sale of such eye bond at such 
rate and on such terms as the Secretary may provide.
    (c) Public Disclosures With Respect to Eye Bonds.--
            (1) In general.--Not less than 2 business days before the 
        date on which an issuer issues an eye bond, the issuer shall 
        file with the Securities and Exchange Commission, and make 
        available to the public, the following information:
                    (A) The nature of all projects funded by the eye 
                bond.
                    (B) The name of any principal individual or 
                institution that will be conducting each project.
                    (C) The milestones established for each project.
                    (D) A determination by the issuer as to whether 
                each project funded by the eye bond has appropriately 
                protected intellectual property.
                    (E) The structure of the eye bond.
                    (F) The interest payment schedule for the eye bond.
                    (G) The anticipated returns and risks of the eye 
                bond.
                    (H) Such other information as the Commission 
                determines necessary or appropriate in the public 
                interest or for the protection of investors.
            (2) Rulemaking.--
                    (A) In general.--Not later than 180 days after the 
                date of enactment of this Act, the Securities and 
                Exchange Commission shall issue regulations to carry 
                out this subsection.
                    (B) Authority of the secretary.--If the Securities 
                and Exchange Commission does not issue the regulations 
                required under subparagraph (A) before the end of the 
                180-day period described under subparagraph (A), the 
                Secretary shall issue regulations to carry out this 
                subsection before the end of the 60-day period 
                beginning on the end of the 180-day period described 
                under subparagraph (A).

SEC. 6. TRANSLATIONAL RESEARCH PROJECTS.

    (a) Eligibility Requirements.--Not later than 180 days after the 
date of enactment of this Act, the Secretary, in consultation with the 
Secretary of the Treasury, the Director of the National Eye Institute, 
and other interested parties, shall issue final regulations for the 
eligibility criteria for selecting translational research projects that 
will be funded through eye bonds. Such regulations shall address--
            (1) the stage of clinical trial for projects to provide the 
        greatest likelihood of commercial application;
            (2) the variations among disease and conditions needed to 
        ensure sufficient diversification in each eye bond; and
            (3) the number of possible cures and treatments that are 
        needed as determined by the Secretary, in consultation with 
        issuers and the Director of the National Eye Institute, to 
        ensure the successful issuance of eye bonds so as to protect 
        the United States as guarantor of the eye bonds, including--
                    (A) drug therapies;
                    (B) gene therapies; and
                    (C) artificial restoration of sight and similar 
                mechanisms.
    (b) Selection of Projects.--
            (1) In general.--The Director of the National Eye 
        Institute, in consultation with the Director of the National 
        Institutes of Health and the Secretary of the Treasury, shall 
        select translational research projects to be funded with the 
        proceeds of an eye bond.
            (2) Factors for selection.--Not later than 30 days after 
        the date on which the final regulations are issued under 
        subsection (a), the Secretary shall submit to the Director of 
        the National Eye Institute factors that the Director of the 
        National Eye Institute shall consider in making the selection 
        under paragraph (1), including--
                    (A) the amount of equity any intellectual property 
                holder will hold in the project;
                    (B) the resources any individual or institution 
                will be required to demonstrate to ensure the ability 
                of the individual or institution to repay the 
                obligation under the eye bond, regardless of the 
                success or failure of the project funded with the 
                proceeds of the eye bond;
                    (C) the number of projects needed to ensure 
                diversification of risk;
                    (D) the manner in which funded projects will be 
                defunded if the interim goals of the project are not 
                satisfied; and
                    (E) such other factors related to biomedical 
                translational research project selection as the 
                Secretary determines appropriate.
            (3) Additional consultations.--
                    (A) In general.--In carrying out paragraph (1), the 
                Director of the National Eye Institute may establish 
                any consultative body that the Director determines is 
                necessary to provide for a complete, transparent, and 
                forward-looking selection of projects.
                    (B) Scientific advisers.--In carrying out paragraph 
                (1), the Director of the National Eye Institute may 
                consult with any group of scientific advisers that the 
                Director determines is necessary.
    (c) Establishment of Milestones.--
            (1) In general.--The Director of the National Eye Institute 
        shall, for each project funded by an eye bond, establish 
        milestones to determine the probability of success or failure 
        for such project.
            (2) Inclusion in filings.--The Director of the National Eye 
        Institute shall submit to the issuer of an eye bond the 
        milestones for each project funded from such eye bond, so such 
        milestones may be included in the filings made available by the 
        issuer to the public under section 5(c).
    (d) Research Requirement.--Translational research carried out under 
a project funded by an eye bond shall be conducted--
            (1) in a State; and
            (2) by an individual or institution that is--
                    (A) chartered in accordance with the laws of that 
                State; and
                    (B) clearly subject to verification of beneficial 
                ownership by the issuer and, upon request, by the 
                Secretary.

SEC. 7. INAPPLICABILITY OF CERTAIN LAWS.

    Eye bonds shall not be subject to--
            (1) section 15G of the Securities Exchange Act of 1934 (15 
        U.S.C. 78o-11);
            (2) except as provided under section 5(c), any registration 
        or disclosure requirement promulgated by the Securities and 
        Exchange Commission; and
            (3) section 13 of the Bank Holding Company Act of 1956 (12 
        U.S.C. 1851).

SEC. 8. REPORTS.

    (a) GAO Study and Reports on Other Research Projects.--
            (1) Ongoing study.--The Comptroller General of the United 
        States shall carry out an ongoing study to consider whether a 
        program similar to the Eye Bond Pilot Program under this Act 
        should be established for other biomedical research projects.
            (2) Report.--The Comptroller General shall, during the 
        period beginning on the date of the establishment of the 
        Program and ending on the termination date of the Program, 
        issue a report to the applicable congressional committees, not 
        less frequently than annually, on all findings and 
        determinations made in carrying out the study required under 
        paragraph (1).
    (b) Reports on the Program.--Not later than 2 years after the date 
on which eye bonds are first issued under this Act, and annually 
thereafter during the period ending on the date that is 4 years after 
the date on which eye bonds are first issued under this Act, the 
Comptroller General and the Director of the National Institutes of 
Health (in consultation with the Director of the National Center for 
Advancing Translational Sciences) shall each issue a separate report to 
the applicable congressional committees on--
            (1) the progress of the issuance of eye bonds;
            (2) the reasons for any problems achieving desired volumes 
        of eye bonds or the ability of the Program to proceed at a 
        faster pace;
            (3) an analysis of the risk to the Government in providing 
        the Federal guarantee described under section 4(b);
            (4) any improvements to eye bonds that the Secretary should 
        consider;
            (5) the applicability of financial instruments similar to 
        eye bonds to other biomedical research areas such as cancer, 
        Alzheimer's disease, rare diseases or conditions (as defined in 
        section 526 of the Federal Food, Drug, and Cosmetic Act (21 
        U.S.C. 360bb)) and syndromes of particular concern to children; 
        and
            (6) any other matter that the Comptroller General or the 
        Director, respectively, determines is appropriate.
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