Protecting Consumer Access to Generic Drugs Act of 2021

I 117TH CONGRESS 1ST SESSION H. R. 153 To prohibit brand name drug manufacturers from compensating generic drug manufacturers to delay the entry of a generic drug into the market, and to prohibit biological product manufacturers from compensating bio- similar and interchangeable product manufacturers to delay entry of biosimilar and interchangeable products, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JANUARY 4, 2021 Mr. RUSH (for himself, Mr. CASTEN, Mr. COHEN, Mr. CONNOLLY, Mr. DESAULNIER, Mr. NEGUSE, Mr. RUIZ, Ms. UNDERWOOD, and Mr. VAN DREW) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on the Judi- ciary, 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 prohibit brand name drug manufacturers from compen- sating generic drug manufacturers to delay the entry of a generic drug into the market, and to prohibit bio- logical product manufacturers from compensating bio- similar and interchangeable product manufacturers to delay entry of biosimilar and interchangeable products, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 153 IH SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Protecting Consumer 2 Access to Generic Drugs Act of 2021’’. 3 SEC. 2. UNLAWFUL AGREEMENTS. 4 (a) AGREEMENTS PROHIBITED.—Subject to sub- 5 sections (b) and (c), it shall be unlawful for an NDA or 6 BLA holder and a subsequent filer (or for two subsequent 7 filers) to enter into, or carry out, an agreement resolving 8 or settling a covered patent infringement claim on a final 9 or interim basis if under such agreement— 10 (1) a subsequent filer directly or indirectly re- 11 ceives from such holder (or in the case of such an 12 agreement between two subsequent filers, the other 13 subsequent filer) anything of value, including a li- 14 cense; and 15 (2) the subsequent filer agrees to limit or fore- 16 go research on, or development, manufacturing, 17 marketing, or sales, for any period of time, of the 18 covered product that is the subject of the application 19 described in subparagraph (A) or (B) of subsection 20 (g)(8). 21 (b) EXCLUSION.—It shall not be unlawful under sub- 22 section (a) if a party to an agreement described in such 23 subsection demonstrates by clear and convincing evidence 24 that the value described in subsection (a)(1) is compensa- 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 153 IH tion solely for other goods or services that the subsequent 1 filer has promised to provide. 2 (c) LIMITATION.—Nothing in this section shall pro- 3 hibit an agreement resolving or settling a covered patent 4 infringement claim in which the consideration granted by 5 the NDA or BLA holder to the subsequent filer (or from 6 one subsequent filer to another) as part of the resolution 7 or settlement includes only one or more of the following: 8 (1) The right to market the covered product 9 that is the subject of the application described in 10 subparagraph (A) or (B) of subsection (g)(8) in the 11 United States before the expiration of— 12 (A) any patent that is the basis of the cov- 13 ered patent infringement claim; or 14 (B) any patent right or other statutory ex- 15 clusivity that would prevent the marketing of 16 such covered product. 17 (2) A payment for reasonable litigation ex- 18 penses not to exceed $7,500,000 in the aggregate. 19 (3) A covenant not to sue on any claim that 20 such covered product infringes a patent. 21 (d) ENFORCEMENT BY FEDERAL TRADE COMMIS- 22 SION.— 23 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 153 IH (1) GENERAL APPLICATION.—The requirements 1 of this section apply, according to their terms, to an 2 NDA or BLA holder or subsequent filer that is— 3 (A) a person, partnership, or corporation 4 over which the Commission has authority pur- 5 suant to section 5(a)(2) of the Federal Trade 6 Commission Act (15 U.S.C. 45(a)(2)); or 7 (B) a person, partnership, or corporation 8 over which the Commission would have author- 9 ity pursuant to such section but for the fact 10 that such person, partnership, or corporation is 11 not organized to carry on business for its own 12 profit or that of its members. 13 (2) UNFAIR OR DECEPTIVE ACTS OR PRACTICES 14 ENFORCEMENT AUTHORITY.— 15 (A) IN GENERAL.—A violation of this sec- 16 tion shall be treated as an unfair or deceptive 17 act or practice in violation of section 5(a)(1) of 18 the Federal Trade Commission Act (15 U.S.C. 19 45(a)(1)). 20 (B) POWERS OF COMMISSION.—Except as 21 provided in subparagraph (C) and paragraphs 22 (1)(B) and (3)— 23 (i) the Commission shall enforce this 24 section in the same manner, by the same 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 153 IH means, and with the same jurisdiction, 1 powers, and duties as though all applicable 2 terms and provisions of the Federal Trade 3 Commission Act (15 U.S.C. 41 et seq.) 4 were incorporated into and made a part of 5 this section; and 6 (ii) any NDA or BLA holder or subse- 7 quent filer that violates this section shall 8 be subject to the penalties and entitled to 9 the privileges and immunities provided in 10 the Federal Trade Commission Act. 11 (C) JUDICIAL REVIEW.—In the case of a 12 cease and desist order issued by the Commis- 13 sion under section 5 of the Federal Trade Com- 14 mission Act (15 U.S.C. 45) for violation of this 15 section, a party to such order may obtain judi- 16 cial review of such order as provided in such 17 section 5, except that— 18 (i) such review may only be obtained 19 in— 20 (I) the United States Court of 21 Appeals for the District of Columbia 22 Circuit; 23 (II) the United States Court of 24 Appeals for the circuit in which the 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 153 IH ultimate parent entity, as defined in 1 section 801.1(a)(3) of title 16, Code 2 of Federal Regulations, or any suc- 3 cessor thereto, of the NDA or BLA 4 holder (if any such holder is a party 5 to such order) is incorporated as of 6 the date that the application described 7 in subparagraph (A) or (B) of sub- 8 section (g)(8) or an approved applica- 9 tion that is deemed to be a license for 10 a biological product under section 11 351(k) of the Public Health Service 12 Act (42 U.S.C. 262(k)) pursuant to 13 section 7002(e)(4) of the Biologics 14 Price Competition and Innovation Act 15 of 2009 (Public Law 111–148; 124 16 Stat. 817) is submitted to the Com- 17 missioner of Food and Drugs; or 18 (III) the United States Court of 19 Appeals for the circuit in which the 20 ultimate parent entity, as so defined, 21 of any subsequent filer that is a party 22 to such order is incorporated as of the 23 date that the application described in 24 subparagraph (A) or (B) of subsection 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 153 IH (g)(8) is submitted to the Commis- 1 sioner of Food and Drugs; and 2 (ii) the petition for review shall be 3 filed in the court not later than 30 days 4 after such order is served on the party 5 seeking review. 6 (3) ADDITIONAL ENFORCEMENT AUTHORITY.— 7 (A) CIVIL PENALTY.—The Commission 8 may commence a civil action to recover a civil 9 penalty in a district court of the United States 10 against any NDA or BLA holder or subsequent 11 filer that violates this section. 12 (B) SPECIAL RULE FOR RECOVERY OF 13 PENALTY IF CEASE AND DESIST ORDER 14 ISSUED.— 15 (i) IN GENERAL.—If the Commission 16 has issued a cease and desist order in a 17 proceeding under section 5 of the Federal 18 Trade Commission Act (15 U.S.C. 45) for 19 violation of this section— 20 (I) the Commission may com- 21 mence a civil action under subpara- 22 graph (A) to recover a civil penalty 23 against any party to such order at 24 any time before the expiration of the 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 8 •HR 153 IH 1-year period beginning on the date 1 on which such order becomes final 2 under section 5(g) of such Act (15 3 U.S.C. 45(g)); and 4 (II) in such civil action, the find- 5 ings of the Commission as to the ma- 6 terial facts in such proceeding shall be 7 conclusive, unless— 8 (aa) the terms of such order 9 expressly provide that the Com- 10 mission’s findings shall not be 11 conclusive; or 12 (bb) such order became final 13 by reason of section 5(g)(1) of 14 such Act (15 U.S.C. 45(g)(1)), in 15 which case such findings shall be 16 conclusive if supported by evi- 17 dence. 18 (ii) RELATIONSHIP TO PENALTY FOR 19 VIOLATION OF AN ORDER.—The penalty 20 provided in clause (i) for violation of this 21 section is separate from and in addition to 22 any penalty that may be incurred for viola- 23 tion of an order of the Commission under 24 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 9 •HR 153 IH section 5(l) of the Federal Trade Commis- 1 sion Act (15 U.S.C. 45(l)). 2 (C) AMOUNT OF PENALTY.— 3 (i) IN GENERAL.—The amount of a 4 civil penalty imposed in a civil action under 5 subparagraph (A) on a party to an agree- 6 ment described in subsection (a) shall be 7 sufficient to deter violations of this section, 8 but in no event greater than— 9 (I) if such party is the NDA or 10 BLA holder (or, in the case of an 11 agreement between two subsequent fil- 12 ers, the subsequent filer who gave the 13 value described in subsection (a)(1)), 14 the greater of— 15 (aa) 3 times the value re- 16 ceived by such NDA or BLA 17 holder (or by such subsequent 18 filer) that is reasonably attrib- 19 utable to the violation of this sec- 20 tion; or 21 (bb) 3 times the value given 22 to the subsequent filer (or to the 23 other subsequent filer) reason- 24 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 10 •HR 153 IH ably attributable to the violation 1 of this section; and 2 (II) if such party is the subse- 3 quent filer (or, in the case of an 4 agreement between two subsequent fil- 5 ers, the subsequent filer who received 6 the value described in subsection 7 (a)(1)), 3 times the value received by 8 such subsequent filer that is reason- 9 ably attributable to the violation of 10 this section. 11 (ii) FACTORS FOR CONSIDERATION.— 12 In determining such amount, the court 13 shall take into account— 14 (I) the nature, circumstances, ex- 15 tent, and gravity of the violation; 16 (II) with respect to the violator, 17 the degree of culpability, any history 18 of violations, the ability to pay, any 19 effect on the ability to continue doing 20 business, profits earned by the NDA 21 or BLA holder (or, in the case of an 22 agreement between two subsequent fil- 23 ers, the subsequent filer who gave the 24 value described in subsection (a)(1)), 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 11 •HR 153 IH compensation received by the subse- 1 quent filer (or, in the case of an 2 agreement between two subsequent fil- 3 ers, the subsequent filer who received 4 the value described in subsection 5 (a)(1)), and the amount of commerce 6 affected; and 7 (III) other matters that justice 8 requires. 9 (D) INJUNCTIONS AND OTHER EQUITABLE 10 RELIEF.—In a civil action under subparagraph 11 (A), the United States district courts are em- 12 powered to grant mandatory injunctions and 13 such other and further equitable relief as they 14 deem appropriate. 15 (4) REMEDIES IN ADDITION.—Remedies pro- 16 vided in this subsection are in addition to, and not 17 in lieu of, any other remedy provided by Federal 18 law. 19 (5) PRESERVATION OF AUTHORITY OF COMMIS- 20 SION.—Nothing in this section shall be construed to 21 affect any authority of the Commission under any 22 other provision of law. 23 (e) FEDERAL TRADE COMMISSION RULEMAKING.— 24 The Commission may, in its discretion, by rule promul- 25 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 12 •HR 153 IH gated under section 553 of title 5, United States Code, 1 exempt from this section certain agreements described in 2 subsection (a) if the Commission finds such agreements 3 to be in furtherance of market competition and for the 4 benefit of consumers. 5 (f) ANTITRUST LAWS.—Nothing in this section shall 6 modify, impair, limit, or supersede the applicability of the 7 antitrust laws as defined in subsection (a) of the first sec- 8 tion of the Clayton Act (15 U.S.C. 12(a)), and of section 9 5 of the Federal Trade Commission Act (15 U.S.C. 45) 10 to the extent that such section 5 applies to unfair methods 11 of competition. Nothing in this section shall modify, im- 12 pair, limit, or supersede the right of a subsequent filer 13 to assert claims or counterclaims against any person, 14 under the antitrust laws or other laws relating to unfair 15 competition. 16 (g) DEFINITIONS.—In this section: 17 (1) AGREEMENT RESOLVING OR SETTLING A 18 COVERED PATENT INFRINGEMENT CLAIM.—The 19 term ‘‘agreement resolving or settling a covered pat- 20 ent infringement claim’’ means any agreement 21 that— 22 (A) resolves or settles a covered patent in- 23 fringement claim; or 24 VerDate Sep 11 2014 23:50 Jan 28, 2021 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H153.IH H153 pamtmann on DSKBC07HB2PROD with BILLS 13 •HR 153 IH (B) is contingent upon, provides for a con- 1 tingent condition for, or is otherwise related to 2 the resolution or settlement of a covered patent 3 infringement claim. 4 (2) COMMISSION.—The term ‘‘Commission’’ 5 means the Federal Trade Commission. 6 (3) COVERED PATENT INFRINGEMENT CLAIM.— 7 The term ‘‘covered patent infringement cl [Text truncated for display. 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