Title: MADE in America Act of 2020
Policy area: Health

Summary:
Manufacturing API, Drugs, and Excipients in America Act of 2020 or the MADE in America Act of 2020
This bill establishes a tax credit for taxpayers engaged in medical production activities in certain areas and contains other provisions related to pharmaceuticals.
An eligible taxpayer may claim a tax credit equal to 30% of qualified expenditures related to the production of pharmaceuticals, medical devices, or other related items in a designated qualified opportunity zone with a poverty rate higher than 30%.
In addition, the Food and Drug Administration shall continue a program to evaluate new drug manufacturing technologies included in an application for approval of a drug or biological product. The bill imposes various requirements on this program, including deadlines for evaluating such a technology.
Furthermore, the Department of Health and Human Services shall establish or expand programs to promote regulatory consistency and cooperation with drug regulatory authorities in other countries.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6930 Introduced in House (IH)]

<DOC>






116th CONGRESS
  2d Session
                                H. R. 6930

  To mitigate drug shortages and provide incentives for maintaining, 
 expanding, and relocating the manufacturing of active pharmaceutical 
 ingredients, excipients, medical diagnostic devices, pharmaceuticals, 
 and personal protective equipment in the United States, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 19, 2020

  Mr. Carter of Georgia (for himself, Mr. Griffith, Mr. McKinley, Mr. 
   Crawford, and Mr. Soto) introduced the following bill; which was 
 referred to the Committee on Energy and Commerce, and in addition to 
   the Committee on Ways and Means, 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 mitigate drug shortages and provide incentives for maintaining, 
 expanding, and relocating the manufacturing of active pharmaceutical 
 ingredients, excipients, medical diagnostic devices, pharmaceuticals, 
 and personal protective equipment in the United States, 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 ``Manufacturing API, Drugs, and 
Excipients in America Act of 2020'' or the ``MADE in America Act of 
2020''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents of this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
                       TITLE I--HEALTH PROVISIONS

Sec. 101. Report to Congress on barriers to domestic manufacturing of 
                            medical products and supplies.
Sec. 102. Enhance intraagency coordination and public health assessment 
                            with regard to compliance activities.
Sec. 103. Encouraging international harmonization.
Sec. 104. Mutual recognition agreements for inspections and review 
                            activities.
Sec. 105. Enhancing transparency of drug facility inspection timelines.
Sec. 106. Advanced manufacturing technologies program.
   TITLE II--TAX INCENTIVES TO INCREASE DOMESTIC PHARMACEUTICAL AND 
                       MEDICAL DEVICE PRODUCTION

Sec. 201. Credit for pharmaceutical and medical device production 
                            activities in distressed zones.

                       TITLE I--HEALTH PROVISIONS

SEC. 101. REPORT TO CONGRESS ON BARRIERS TO DOMESTIC MANUFACTURING OF 
              MEDICAL PRODUCTS AND SUPPLIES.

    (a) Report.--Not later than January 1, 2021, the Secretary of 
Health and Human Services (referred to in this section as the 
``Secretary'') shall submit to the Committee on Energy and Commerce of 
the House of Representatives and the Committee on Health, Education, 
Labor, and Pensions of the Senate a report on barriers to domestic 
manufacturing of active pharmaceutical ingredients, drugs, and devices 
that are sourced or manufactured outside of the United States.
    (b) Contents.--Such report shall--
            (1) identify factors that limit or otherwise discourage the 
        domestic manufacturing of active pharmaceutical ingredients, 
        drugs, and devices that are currently sourced or manufactured 
        outside of the United States, including any Federal, State, 
        local, or Tribal laws and regulations that hinder domestic 
        manufacturing opportunities; and
            (2) recommend specific strategies to overcome the 
        challenges identified under paragraph (1), including 
        strategies--
                    (A) to develop effective incentives for domestic 
                manufacturing; and
                    (B) to make changes to laws or regulations that 
                hinder domestic manufacturing opportunities.
    (c) Consultation.--In carrying out the report under subsection (a), 
the Secretary shall consult with--
            (1) the Food and Drug Administration, the Centers for 
        Medicare & Medicaid Services, the Department of Defense, the 
        Department of Commerce, the Department of State, the Department 
        of Veterans Affairs, the Department of Justice, and any other 
        Federal agencies as appropriate; and
            (2) relevant stakeholders, including drug, device, and 
        active pharmaceutical ingredient manufacturers, and other 
        entities, as appropriate.
    (d) Definition.--In this section, the term ``active pharmaceutical 
ingredient'' has the meaning given to such term in section 207.1 of 
title 21, Code of Federal Regulations (and any successor regulations).
    (e) Publication.--The Secretary shall make the report under 
subsection (a) available on the public website of the Department of 
Health and Human Services.

SEC. 102. ENHANCE INTRAAGENCY COORDINATION AND PUBLIC HEALTH ASSESSMENT 
              WITH REGARD TO COMPLIANCE ACTIVITIES.

    (a) Benefit/Risk Framework.--
            (1) In general.--Paragraph (2) of section 704(b) of the 
        Federal Food, Drug, and Cosmetic Act (21 U.S.C. 374(b)) is 
        amended by adding at the end the following: ``The Secretary 
        shall ensure timely and effective coordination among such 
        offices regarding the reviews of such report and the alignment 
        of any feedback regarding such report, and any corrective or 
        preventive actions in response to such report, after 
        consideration of the benefits and risks to the public health, 
        patient safety, the drug supply and drug supply chain, and 
        timely patient access to drugs.''.
            (2) Annual reporting.--Subsection (b) of section 704 of the 
        Federal Food, Drug, and Cosmetic Act (21 U.S.C. 374) is amended 
        by adding at the end the following new paragraph:
    ``(3) On an annual basis, the Secretary shall prepare a report on 
the utilization of the framework described in paragraph (2) and post 
such report on the public website of the Food and Drug 
Administration.''.
            (3) Applicability.--The amendments made by paragraphs (1) 
        and (2) shall take effect on the effective date described in 
        section 3112 of the CARES Act (Public Law 116-136), after 
        executing the amendments made by such section 3112, and shall 
        apply beginning on the date that is 1 year after the date of 
        enactment of this Act.
    (b) Public Meeting.--The Secretary of Health and Human Services 
shall publish in the Federal Register a notice of a public meeting to 
be held no later than six months after the date of enactment of this 
Act to discuss and obtain input and recommendations from public 
stakeholders, including patient advocates, consumers, regulated 
industry, and health care providers, regarding the contents of a 
benefit/risk framework described in section 704(b)(2) of the Federal 
Food, Drug, and Cosmetic Act, as amended by subsection (a), that 
supports a safe, stable, redundant drug supply chain.
    (c) Guidance.--The Secretary of Health and Human Services shall--
            (1) not later than one year after the date of enactment of 
        this Act, issue draft guidance regarding the goals and 
        implementation of a benefit/risk framework described in 
        subsection (b); and
            (2) not later than two years after such date of enactment, 
        issue final guidance with respect to the implementation of such 
        a framework.

SEC. 103. ENCOURAGING INTERNATIONAL HARMONIZATION.

    (a) GAO Study.--Not later than one year after the date of enactment 
of this Act, the Comptroller General of the United States shall issue a 
report evaluating--
            (1) the consistency with which the International Conference 
        on Harmonisation (in this section referred to as ``ICH'') 
        guidelines on good manufacturing practices, including ICH 
        Guidelines Q8-11, are being implemented by drug regulatory 
        authorities across countries and international regions;
            (2) whether domestic active pharmaceutical ingredient 
        manufacturers (including any such contract manufacturers) are 
        provided sufficient opportunity to participate with regulatory 
        authorities in the development of guidelines prior to 
        implementation;
            (3) whether divergence from ICH guidelines or differing 
        regulatory standards or requirements by drug regulatory 
        authorities across countries and international regions 
        creates--
                    (A) inefficiencies in drug manufacturing;
                    (B) incompatible requirements that can contribute 
                to or exacerbate drug shortages; and
                    (C) the most common areas of divergence between ICH 
                guidelines and regulatory standards and requirements by 
                drug regulatory authorities across countries and 
                international regions that, if rectified, may reduce 
                the inefficiencies and incompatibilities identified 
                pursuant to subparagraphs (A) and (B).
    (b) International Training Program.--Not later than two years after 
the date of enactment of this Act, informed by the needs identified in 
the report issued pursuant to subsection (a), the Secretary of Health 
and Human Services, in conjunction with drug regulatory authorities 
across countries and international regions and the ICH, shall develop 
and implement a training program for drug regulatory authorities across 
countries and international regions to promote consistent application 
of and reduce divergence from ICH guidelines on good manufacturing 
practices.

SEC. 104. MUTUAL RECOGNITION AGREEMENTS FOR INSPECTIONS AND REVIEW 
              ACTIVITIES.

    (a) Mutual Recognition of Inspections.--Pursuant to section 809 of 
the Federal Food, Drug and Cosmetics Act (21 U.S.C. 384e), the 
Secretary of Health and Human Services (in this section referred to as 
the ``Secretary'') shall establish or expand initiatives for mutual 
sharing of review and inspection criteria between drug regulatory 
authorities across countries and international regions, such as through 
the Pharmaceutical Cooperation Inspection Scheme, the Mutual 
Recognition Agreement with the European Union, and the Australia-
Canada-Singapore-Switzerland Consortium, to--
            (1) reduce the potential for duplicative regulatory 
        evaluation of medical products regulated by the Food and Drug 
        Administration; and
            (2) more constructively allocate appropriations to the Food 
        and Drug Administration, including those attributable to user 
        fees, to harmonized regulatory processes.
    (b) Additional Countries, Regions, and Evaluation.--In carrying out 
subsection (a), the Secretary may expand the initiatives to include--
            (1) additional countries and geographic regions with 
        established and competent regulatory frameworks; and
            (2) additional types of regulatory evaluation, including 
        with respect to--
                    (A) good manufacturing practice inspections; and
                    (B) approval of changes to the manufacturing of 
                drugs for which an approval or licensure is in effect 
                under section 505 of the Federal Food, Drug, and 
                Cosmetic Act (21 U.S.C. 355) or section 351 of the 
                Public Health Service Act (42 U.S.C. 262).
    (c) Implementation Framework.--
            (1) Publication.--Not later than one year after the date of 
        enactment of this Act, the Secretary shall publish an 
        implementation framework for the agreements to share review and 
        inspection criteria under subsection (a) on the public website 
        of the Food and Drug Administration.
            (2) Contents.--The implementation framework under this 
        subsection shall--
                    (A) include the timeline for establishing or 
                expanding initiatives described in subsection (a);
                    (B) describe additional types of regulatory 
                processes that will become subject to such initiatives;
                    (C) specify the countries and geographic regions 
                where such initiatives will be established or expanded; 
                and
                    (D) identify additional opportunities and 
                challenges for expanding mutual recognition agreements 
                in drug and biologic regulation.
    (d) Annual Reporting.--
            (1) In general.--Not later than the end of calendar year 
        2020 and annually thereafter, the Secretary shall publish a 
        report on the public website of the Food and Drug 
        Administration on the utilization of agreements described in 
        subsection (c)(1) in the previous fiscal year.
            (2) Contents.--The report under paragraph (1) shall include 
        each of the following:
                    (A) The total number of establishments that are 
                registered under section 510(i) of the Federal Food, 
                Drug, and Cosmetic Act (21 U.S.C. 360) and located 
                outside of the United States, and of these 
                establishments, the number in each region of interest.
                    (B) The total number of inspections conducted at 
                establishments described in subparagraph (A).
                    (C) Of the inspections described in subparagraph 
                (B), the total number of inspections in each of region 
                of interest.
                    (D) Of the inspections in each region of interest 
                reported pursuant to subparagraph (C), the number of 
                inspections in each FDA inspection category.
                    (E) Of the number of inspections reported under 
                each of subparagraphs (B), (C), and (D)--
                            (i) the number of inspections which have 
                        been conducted pursuant to an agreement 
                        described in subsection (c)(1); and
                            (ii) the number of inspections which have 
                        been conducted by employees or other agents of 
                        the Food and Drug Administration.
            (3) Definitions.--In this subsection:
                    (A) The term ``region of interest'' refers to 
                China, India, the European Union, and any other 
                geographic region as determined appropriate by the 
                Secretary.
                    (B) The term ``FDA inspection category'' means 
                refers to the following inspection categories:
                            (i) Inspections to support an approval of a 
                        drug under section 505 of the Federal Food, 
                        Drug, and Cosmetic Act (21 U.S.C. 355) or 
                        section 351 of the Public Health Service Act 
                        (42 U.S.C. 262).
                            (ii) Good manufacturing practice 
                        inspections.
                            (iii) For-cause inspections.

SEC. 105. ENHANCING TRANSPARENCY OF DRUG FACILITY INSPECTION TIMELINES.

    Section 902 of the FDA Reauthorization Act of 2017 (21 U.S.C. 355 
note) is amended to read as follows:

``SEC. 902. ANNUAL REPORT ON INSPECTIONS.

    ``Not later than March 1 of each year, the Secretary of Health and 
Human Services shall post on the public website of the Food and Drug 
Administration information related to inspections of facilities 
necessary for approval of a drug under subsection (c) or (j) of section 
505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355), 
approval of a device under section 515 of such Act (21 U.S.C. 360e), or 
clearance of a device under section 510(k) of such Act (21 U.S.C. 
360(k)) that were conducted during the previous calendar year. Such 
information shall include the following:
            ``(1) The median time following a request from staff of the 
        Food and Drug Administration reviewing an application or report 
        to the beginning of the inspection, and the median time from 
        the beginning of an inspection to the issuance of a report 
        pursuant to section 704(b) of the Federal Food, Drug, and 
        Cosmetic Act (21 U.S.C. 374(b)), including--
                    ``(A) the median time for drugs described in 
                505(j)(11)(A)(i) of the Federal Food, Drug, and 
                Cosmetic Act (21 U.S.C. 355(j)(11)(A)(i));
                    ``(B) the median time for drugs described in 
                section 506C(a) of such Act (21 U.S.C. 356c(a)) only; 
                and
                    ``(C) the median time for drugs on the drug 
                shortage list in effect under section 506E of such Act 
                (21 U.S.C. 356f).
            ``(2) The median time from the issuance of a report 
        pursuant to such section 704(b) to the sending of a warning 
        letter, issuance of an import alert, or holding of a regulatory 
        meeting for inspections for which the Secretary concluded that 
        regulatory or enforcement action was indicated, including the 
        median time for each category of drugs listed in subparagraphs 
        (A) through (C) of paragraph (1).
            ``(3) The median time from the sending of a warning letter, 
        issuance of an import alert, or holding of a regulatory meeting 
        to resolution of the regulatory or enforcement action indicated 
        for inspections for which the Secretary concluded that such 
        action was indicated.
            ``(4) The number of times that a facility was issued a 
        report pursuant to such section 704(b) and approval of an 
        application was delayed due to the issuance of a withhold 
        recommendation, including the number of such times for each 
        category of drugs listed in subparagraphs (A) through (C) of 
        paragraph (1).''.

SEC. 106. ADVANCED MANUFACTURING TECHNOLOGIES PROGRAM.

    Subchapter A of chapter V of the Federal Food, Drug, and Cosmetic 
Act (21 U.S.C. 351 et seq.) is amended by adding at the end the 
following:

``SEC. 524B. ADVANCED MANUFACTURING TECHNOLOGIES PROGRAM.

    ``(a) In General.--Not later than 1 year after the date of 
enactment of the Manufacturing API, Drugs, and Excipients in America 
Act of 2020, the Secretary shall continue in effect the program to 
evaluate new drug manufacturing technologies that are included in an 
application, or supplement to an application, for a drug under 
subsection (b) or (j) of section 505 of this Act or for a biological 
product submitted under subsection (a) or (k) of section 351 of the 
Public Health Service Act.
    ``(b) Designation.--The Secretary shall designate a method of 
manufacturing a drug as an advanced manufacturing technology under this 
section if the drug manufacturer demonstrates that such technology is 
likely to--
            ``(1) prevent or resolve a drug shortage;
            ``(2) maintain an adequate supply of critical medications 
        for national emergencies; or
            ``(3) promote the adoption of innovative approaches to drug 
        product design and manufacturing.
    ``(c) Consultation.--If the Secretary designates a method of 
manufacturing as an advanced manufacturing technology under this 
section, the Secretary shall take actions to expedite the development 
and implementation of such method of manufacture for purposes of 
approval of the application under subsection (c) or (j) of section 505 
of this Act or subsection (a) or (k) of section 351 of the Public 
Health Service Act, which may include, as appropriate--
            ``(1) holding meetings between the sponsor of the 
        application and appropriate Food and Drug Administration staff 
        throughout the development of the technology;
            ``(2) providing timely advice to, and interactive 
        communication with, the sponsor regarding the development of 
        the technology; and
            ``(3) involving senior managers and experienced staff of 
        the Food and Drug Administration, as appropriate, in a 
        collaborative, cross-disciplinary review of the method of 
        manufacturing.
    ``(d) Evaluation of an Advanced Manufacturing Technology.--
            ``(1) Package.--A sponsor who receives designation of an 
        advanced manufacturing technology under this section shall 
        provide the Secretary with a package of scientific evidence 
        supporting the implementation of the advanced manufacturing 
        technology in a particular context-of-use.
            ``(2) Evaluation.--Within 90 days of receiving the package, 
        the Secretary shall determine whether a designated advanced 
        manufacturing technology is validated for the proposed context 
        of use based on the scientific merit the supporting evidence 
        provided by the sponsor.
            ``(3) Effect of approval.--Upon approval, the same sponsor 
        may rely upon the advanced manufacturing technology for use 
        across multiple manufacturing product lines within the same 
        context-of-use without having to re-submit data to the 
        Secretary validating the underlying technology.
    ``(e) Implementation and Reporting.--
            ``(1) Public meeting.--The Secretary shall publish in the 
        Federal Register a notice of a public meeting to be held no 
        later than 1 year after the date of enactment of the 
        Manufacturing API, Drugs, and Excipients in America Act of 2020 
        to discuss and obtain input and recommendations from 
        stakeholders regarding the goals and scope of, and a suitable 
        framework and procedures and requirements for, the program 
        under this section.
            ``(2) Program guidance.--The Secretary shall--
                    ``(A) not later than 1 year after the date of 
                enactment of the Manufacturing API, Drugs, and 
                Excipients in America Act of 2020, issue draft guidance 
                regarding the goals and implementation of the program 
                under this section; and
                    ``(B) not later than 2 years after the date of 
                enactment of the Manufacturing API, Drugs, and 
                Excipients in America Act of 2020, issue final guidance 
                with respect to the implementation of such program.
            ``(3) Report.--The Secretary shall make available on the 
        public website of the Food and Drug Administration an annual 
        report on the progress of the program under this section.''.

   TITLE II--TAX INCENTIVES TO INCREASE DOMESTIC PHARMACEUTICAL AND 
                       MEDICAL DEVICE PRODUCTION

SEC. 201. CREDIT FOR PHARMACEUTICAL AND MEDICAL DEVICE PRODUCTION 
              ACTIVITIES IN DISTRESSED ZONES.

    (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. 45U. DISTRESSED ZONE PHARMACEUTICAL AND MEDICAL DEVICE 
              PRODUCTION CREDIT.

    ``(a) In General.--For purposes of section 38, the distressed zone 
pharmaceutical and medical device production credit for the taxable 
year shall be an amount equal to 30 percent of the qualified production 
activity expenditures of the taxpayer for the taxable year.
    ``(b) Qualified Production Activity Expenditures.--For purposes of 
this section--
            ``(1) In general.--The term `qualified production activity 
        expenditures' means--
                    ``(A) wages paid or incurred to an employee of the 
                taxpayer for services performed by such employee in the 
                conduct of a qualified pharmaceutical or diagnostic 
                medical device production business in a distressed zone 
                (but only if the employee's principal place of 
                employment is in a distressed zone), or
                    ``(B) amounts paid or incurred for any tangible 
                personal property (whether or not otherwise properly 
                chargeable to capital account) used in the conduct of a 
                qualified pharmaceutical or medical device production 
                business in a distressed zone (but only if the primary 
                use of such property is in a distressed zone).
            ``(2) Qualified pharmaceutical or medical device production 
        business.--
                    ``(A) In general.--The term `qualified 
                pharmaceutical or medical device production business' 
                means the trade or business of producing 
                pharmaceuticals, excipients, active pharmaceutical 
                ingredients, medical diagnostic devices, or personal 
                protective equipment.
                    ``(B) Active pharmaceutical ingredient.--The term 
                `active pharmaceutical ingredients' has the meaning 
                given to such term in section 207.1 of title 21, Code 
                of Federal Regulations (and any successor regulations).
                    ``(C) Excipient.--The term `excipient'--
                            ``(i) means any inactive ingredient that is 
                        intentionally added to a pharmaceutical that is 
                        not intended to exert therapeutic effects at 
                        the intended dosage, other than by acting to 
                        improve product delivery; and
                            ``(ii) includes any such filler, extenders, 
                        diluent, wetting agent, solvent, emulsifier, 
                        preservative, flavor, absorption enhancer, 
                        sustained release matrix, and coloring agent.
                    ``(D) Medical diagnostic device.--The term `medical 
                diagnostic device' means any device (as defined in 
                section 201(h) of the Federal Food, Drug, and Cosmetic 
                Act) intended for use in the diagnosis of disease or 
                other conditions.
                    ``(E) Personal protective equipment.--The term 
                `personal protective equipment' means--
                            ``(i) any device (as defined in section 
                        201(h) of the Federal Food, Drug, and Cosmetic 
                        Act) that is a face mask, filtering facepiece 
                        respirator, face shield, surgical mask, gown, 
                        other apparel, or glove that is intended for a 
                        medical purpose; and
                            ``(ii) any particulate filtering air 
                        purifying respiratory protective device that is 
                        approved by the National Institute for 
                        Occupational Safety and Health under part 84 of 
                        title 42, Code of Federal Regulations (or 
                        successor regulations).
                    ``(F) Pharmaceutical.--The term `pharmaceutical'--
                            ``(i) means any drug (as defined in section 
                        201 of the Federal Food, Drug, and Cosmetic 
                        Act); and
                            ``(ii) includes a biological product (as 
                        defined in section 351 of the Public Health 
                        Service Act).
            ``(3) Certain health plan expenses treated as wages.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the term `wages' shall include so much of the eligible 
                employer's qualified health plan expenses as are 
                properly allocable to such wages.
                    ``(B) Qualified health plan expenses.--For purposes 
                of this paragraph, the term `qualified health plan 
                expenses' means amounts paid or incurred by the 
                eligible employer to provide and maintain a group 
                health plan (as defined in section 5000(b)(1)), but 
                only to the extent that such amounts are excluded from 
                the gross income of employees by reason of section 
                106(a) of such Code.
                    ``(C) Allocation rules.--For purposes of this 
                paragraph, qualified health plan expenses shall be 
                allocated to qualified wages in such manner as the 
                Secretary may prescribe. Except as otherwise provided 
                by the Secretary, such allocation shall be treated as 
                properly made if made on the basis of being pro rata 
                among employees and pro rata on the basis of periods of 
                coverage (relative to the periods to which such wages 
                relate).
            ``(4) Distressed zone.--The term `distressed zone' means a 
        population census tract--
                    ``(A) which has been designated as a qualified 
                opportunity zone under section 1400Z-1, and
                    ``(B) which has a poverty rate in excess of 30 
                percent for the calendar year prior to the calendar 
                year that includes the date of enactment of this 
                section.
    ``(c) Special Rules.--
            ``(1) Reduction in basis.--If a credit is determined under 
        this section with respect to any property by reason of any 
        qualified production activity expenditures described in 
        subsection (b)(1)(B), the basis of such property shall be 
        reduced by the amount of the credit so determined.
            ``(2) Coordination with other credits.--Any qualified 
        production activity expenditures taken into account in 
        determining the amount of the credit under subsection (a) shall 
        not be taken into account in determining a credit under any 
        other provision of this chapter.
            ``(3) Limitation on wages taken into account.--The amount 
        of wages taken into account under subsection (a) with respect 
        to any employee shall not exceed an amount equal to the 
        contribution and benefit base in effect under section 230 of 
        the Social Security Act for the calendar year in which the 
        taxable year begins.''.
    (b) Credit Allowed Against Alternative Minimum Tax.--Section 
38(c)(4)(B) of such Code is amended by redesignating clauses (x), (xi), 
and (xii) as clauses (xi), (xii), and (xiii), respectively and by 
inserting after clause (ix) the following new clause:
                            ``(x) the credit determined under section 
                        45U,''.
    (c) Special Rule for Controlled Foreign Corporations.--Section 
960(d) of such Code is amended by adding at the end the following new 
paragraph:
            ``(4) Special for controlled foreign corporations with 
        distressed zone pharmaceutical and medical device 
        expenditures.--The amount of foreign taxes deemed paid by a 
        domestic corporation under paragraph (1) (determined without 
        regard to this paragraph) shall be increased by an amount equal 
        to the lesser of--
                    ``(A) the excess of--
                            ``(i) the amount calculated with respect to 
                        such corporation under paragraph (1) 
                        (determined without regard to this paragraph 
                        and by substituting `100 percent' for `80 
                        percent'), over
                            ``(ii) the amount calculated with respect 
                        to such corporation under paragraph (1) 
                        (determined without regard to this paragraph), 
                        or
                    ``(B) an amount equal to 15 percent of the 
                qualified production activity expenditures (as defined 
                in section 45U(b)(1)) of the controlled foreign 
                corporation for the taxable year of the foreign 
                corporation ending in or with the taxable year of the 
                domestic corporation.''.
    (d) Denial of Deduction.--Section 280C of such Code is amended by 
adding at the end the following new subsection:
    ``(i) Distressed Zone Pharmaceutical and Medical Device Production 
Credit.--No deduction shall be allowed for that portion of the 
qualified production activity expenditures (as defined in section 
45U(b)) otherwise allowable as a deduction for the taxable year which 
is equal to the amount of the distressed zone pharmaceutical and 
medical device production credit determined for such taxable year under 
section 45U(a).''.
    (e) Part of General Business Credit.--Section 38(b) of such Code is 
amended by striking ``plus'' at the end of paragraph (32), by striking 
the period at the end of paragraph (33) and inserting ``, plus'', and 
by adding at the end the following new paragraph:
            ``(34) the distressed zone pharmaceutical and medical 
        device production credit determined under section 45U(a).''.
    (f) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 is amended by adding at the end 
the following new item:

``Sec. 45U. Distressed zone pharmaceutical and medical device 
                            production credit.''.
    (g) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after the date of the enactment of 
this Act.
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