CREATES Act of 2019

IB Union Calendar No. 33 116TH CONGRESS 1ST SESSION H. R. 965 [Report No. 116–55, Parts I and II] To promote competition in the market for drugs and biological products by facilitating the timely entry of lower-cost generic and biosimilar versions of those drugs and biological products. IN THE HOUSE OF REPRESENTATIVES FEBRUARY 5, 2019 Mr. CICILLINE (for himself, Mr. SENSENBRENNER, Mr. NADLER, Mr. COL- LINS of Georgia, Mr. WELCH, and Mr. MCKINLEY) introduced the fol- lowing bill; which was referred to the Committee on Energy and Com- merce, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consider- ation of such provisions as fall within the jurisdiction of the committee concerned MAY 10, 2019 Additional sponsors: Mr. MEADOWS, Ms. FINKENAUER, Mr. DOGGETT, Mr. COLE, Mr. GALLAGHER, Mr. LIPINSKI, Mr. RUSH, Ms. MCCOLLUM, Mr. PALLONE, Mr. PERRY, Mr. RUIZ, Mrs. DINGELL, Ms. ESHOO, Ms. MAT- SUI, Mrs. CRAIG, Mr. TONKO, Mr. GOHMERT, Mr. VAN DREW, Ms. CLARKE of New York, Mr. COURTNEY, Mr. ALLRED, Ms. SCHAKOWSKY, Mr. CROW, Mr. GONZALEZ of Ohio, Mr. LARSON of Connecticut, Mr. MCADAMS, Mr. SCHRADER, Mr. RODNEY DAVIS of Illinois, Mr. PAPPAS, Mr. KENNEDY, Ms. DAVIDS of Kansas, Mr. NORCROSS, Ms. SPANBERGER, Mr. QUIGLEY, Mr. DEUTCH, Mr. LANGEVIN, Mr. COOPER, Mrs. MCBATH, Mr. RASKIN, Ms. MUCARSEL-POWELL, Mr. STANTON, Mr. JORDAN, Ms. WILD, Mr. COHEN, Mr. KIM, Ms. SCHRIER, Mr. JOYCE of Ohio, Mr. CASE, Mr. KHANNA, Mr. DAVID SCOTT of Georgia, Ms. HOULAHAN, Mr. CASTEN of Illinois, Mr. NORMAN, Ms. PINGREE, Mr. CARBAJAL, Mr. SMITH of Washington, Ms. WEXTON, Mr. CISNEROS, Mr. CONNOLLY, Ms. UNDERWOOD, Ms. GARCIA of Texas, Ms. MENG, and Mrs. BUSTOS VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6652 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 965 RH MAY 10, 2019 Reported from the Committee on Energy and Commerce with an amendment [Strike out all after the enacting clause and insert the part printed in italic] MAY 10, 2019 Reported from the Committee on the Judiciary; committed to the Committee of the Whole House on the State of the Union and ordered to be printed [For text of introduced bill, see copy of bill as introduced on February 5, 2019] A BILL To promote competition in the market for drugs and biologi- cal products by facilitating the timely entry of lower- cost generic and biosimilar versions of those drugs and biological products. VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6652 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 965 RH Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Creating and Restoring 4 Equal Access to Equivalent Samples Act of 2019’’ or the 5 ‘‘CREATES Act of 2019’’. 6 SEC. 2. ACTIONS FOR DELAYS OF GENERIC DRUGS AND BIO- 7 SIMILAR BIOLOGICAL PRODUCTS. 8 (a) DEFINITIONS.—In this section— 9 (1) the term ‘‘commercially reasonable, market- 10 based terms’’ means— 11 (A) a nondiscriminatory price for the sale 12 of the covered product at or below, but not great- 13 er than, the most recent wholesale acquisition 14 cost for the drug, as defined in section 15 1847A(c)(6)(B) of the Social Security Act (42 16 U.S.C. 1395w–3a(c)(6)(B)); 17 (B) a schedule for delivery that results in 18 the transfer of the covered product to the eligible 19 product developer consistent with the timing 20 under subsection (b)(2)(A)(iv); and 21 (C) no additional conditions are imposed 22 on the sale of the covered product; 23 (2) the term ‘‘covered product’’— 24 (A) means— 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 965 RH (i) any drug approved under sub- 1 section (c) or (j) of section 505 of the Fed- 2 eral Food, Drug, and Cosmetic Act (21 3 U.S.C. 355) or biological product licensed 4 under subsection (a) or (k) of section 351 of 5 the Public Health Service Act (42 U.S.C. 6 262); 7 (ii) any combination of a drug or bio- 8 logical product described in clause (i); or 9 (iii) when reasonably necessary to sup- 10 port approval of an application under sec- 11 tion 505 of the Federal Food, Drug, and 12 Cosmetic Act (21 U.S.C. 355), or section 13 351 of the Public Health Service Act (42 14 U.S.C. 262), as applicable, or otherwise 15 meet the requirements for approval under 16 either such section, any product, including 17 any device, that is marketed or intended for 18 use with such a drug or biological product; 19 and 20 (B) does not include any drug or biological 21 product that appears on the drug shortage list in 22 effect under section 506E of the Federal Food, 23 Drug, and Cosmetic Act (21 U.S.C. 356e), un- 24 less— 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 5 •HR 965 RH (i) the drug or biological product has 1 been on the drug shortage list in effect 2 under such section 506E continuously for 3 more than 6 months; or 4 (ii) the Secretary determines that in- 5 clusion of the drug or biological product as 6 a covered product is likely to contribute to 7 alleviating or preventing a shortage. 8 (3) the term ‘‘device’’ has the meaning given the 9 term in section 201 of the Federal Food, Drug, and 10 Cosmetic Act (21 U.S.C. 321); 11 (4) the term ‘‘eligible product developer’’ means 12 a person that seeks to develop a product for approval 13 pursuant to an application for approval under sub- 14 section (b)(2) or (j) of section 505 of the Federal 15 Food, Drug, and Cosmetic Act (21 U.S.C. 355) or for 16 licensing pursuant to an application under section 17 351(k) of the Public Health Service Act (42 U.S.C. 18 262(k)); 19 (5) the term ‘‘license holder’’ means the holder of 20 an application approved under subsection (c) or (j) of 21 section 505 of the Federal Food, Drug, and Cosmetic 22 Act (21 U.S.C. 355) or the holder of a license under 23 subsection (a) or (k) of section 351 of the Public 24 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 6 •HR 965 RH Health Service Act (42 U.S.C. 262) for a covered 1 product; 2 (6) the term ‘‘REMS’’ means a risk evaluation 3 and mitigation strategy under section 505–1 of the 4 Federal Food, Drug, and Cosmetic Act (21 U.S.C. 5 355–1); 6 (7) the term ‘‘REMS with ETASU’’ means a 7 REMS that contains elements to assure safe use under 8 section 505–1(f) of the Federal Food, Drug, and Cos- 9 metic Act (21 U.S.C. 355–1(f)); 10 (8) the term ‘‘Secretary’’ means the Secretary of 11 Health and Human Services; 12 (9) the term ‘‘single, shared system of elements to 13 assure safe use’’ means a single, shared system of ele- 14 ments to assure safe use under section 505–1(f) of the 15 Federal Food, Drug, and Cosmetic Act (21 U.S.C. 16 355–1(f)); and 17 (10) the term ‘‘sufficient quantities’’ means an 18 amount of a covered product that the eligible product 19 developer determines allows it to— 20 (A) conduct testing to support an applica- 21 tion under— 22 (i) subsection (b)(2) or (j) of section 23 505 of the Federal Food, Drug, and Cos- 24 metic Act (21 U.S.C. 355); or 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 7 •HR 965 RH (ii) section 351(k) of the Public Health 1 Service Act (42 U.S.C. 262(k)); and 2 (B) fulfill any regulatory requirements re- 3 lating to approval of such an application. 4 (b) CIVIL ACTION FOR FAILURE TO PROVIDE SUFFI- 5 CIENT QUANTITIES OF A COVERED PRODUCT.— 6 (1) IN GENERAL.—An eligible product developer 7 may bring a civil action against the license holder for 8 a covered product seeking relief under this subsection 9 in an appropriate district court of the United States 10 alleging that the license holder has declined to provide 11 sufficient quantities of the covered product to the eli- 12 gible product developer on commercially reasonable, 13 market-based terms. 14 (2) ELEMENTS.— 15 (A) IN GENERAL.—To prevail in a civil ac- 16 tion brought under paragraph (1), an eligible 17 product developer shall prove, by a preponder- 18 ance of the evidence— 19 (i) that— 20 (I) the covered product is not sub- 21 ject to a REMS with ETASU; or 22 (II) if the covered product is sub- 23 ject to a REMS with ETASU— 24 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 8 •HR 965 RH (aa) the eligible product de- 1 veloper has obtained a covered 2 product authorization from the 3 Secretary in accordance with sub- 4 paragraph (B); and 5 (bb) the eligible product de- 6 veloper has provided a copy of the 7 covered product authorization to 8 the license holder; 9 (ii) that, as of the date on which the 10 civil action is filed, the product developer 11 has not obtained sufficient quantities of the 12 covered product on commercially reasonable, 13 market-based terms; 14 (iii) that the eligible product developer 15 has requested to purchase sufficient quan- 16 tities of the covered product from the license 17 holder; and 18 (iv) that the license holder has not de- 19 livered to the eligible product developer suf- 20 ficient quantities of the covered product on 21 commercially reasonable, market-based 22 terms— 23 (I) for a covered product that is 24 not subject to a REMS with ETASU, 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 9 •HR 965 RH by the date that is 31 days after the 1 date on which the license holder re- 2 ceived the request for the covered prod- 3 uct; and 4 (II) for a covered product that is 5 subject to a REMS with ETASU, by 6 31 days after the later of— 7 (aa) the date on which the li- 8 cense holder received the request 9 for the covered product; or 10 (bb) the date on which the li- 11 cense holder received a copy of the 12 covered product authorization 13 issued by the Secretary in accord- 14 ance with subparagraph (B). 15 (B) AUTHORIZATION FOR COVERED PROD- 16 UCT SUBJECT TO A REMS WITH ETASU.— 17 (i) REQUEST.—An eligible product de- 18 veloper may submit to the Secretary a writ- 19 ten request for the eligible product developer 20 to be authorized to obtain sufficient quan- 21 tities of an individual covered product sub- 22 ject to a REMS with ETASU. 23 (ii) AUTHORIZATION.—Not later than 24 120 days after the date on which a request 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 10 •HR 965 RH under clause (i) is received, the Secretary 1 shall, by written notice, authorize the eligi- 2 ble product developer to obtain sufficient 3 quantities of an individual covered product 4 subject to a REMS with ETASU for pur- 5 poses of— 6 (I) development and testing that 7 does not involve human clinical trials, 8 if the eligible product developer has 9 agreed to comply with any conditions 10 the Secretary determines necessary; or 11 (II) development and testing that 12 involves human clinical trials, if the 13 eligible product developer has— 14 (aa)(AA) submitted protocols, 15 informed consent documents, and 16 informational materials for test- 17 ing that include protections that 18 provide safety protections com- 19 parable to those provided by the 20 REMS for the covered product; or 21 (BB) otherwise satisfied the 22 Secretary that such protections 23 will be provided; and 24 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 11 •HR 965 RH (bb) met any other require- 1 ments the Secretary may estab- 2 lish. 3 (iii) NOTICE.—A covered product au- 4 thorization issued under this subparagraph 5 shall state that the provision of the covered 6 product by the license holder under the 7 terms of the authorization will not be a vio- 8 lation of the REMS for the covered product. 9 (3) AFFIRMATIVE DEFENSE.—In a civil action 10 brought under paragraph (1), it shall be an affirma- 11 tive defense, on which the defendant has the burden 12 of persuasion by a preponderance of the evidence— 13 (A) that, on the date on which the eligible 14 product developer requested to purchase sufficient 15 quantities of the covered product from the license 16 holder— 17 (i) neither the license holder nor any of 18 its agents, wholesalers, or distributors was 19 engaged in the manufacturing or commer- 20 cial marketing of the covered product; and 21 (ii) neither the license holder nor any 22 of its agents, wholesalers, or distributors 23 otherwise had access to inventory of the cov- 24 ered product to supply to the eligible prod- 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 12 •HR 965 RH uct developer on commercially reasonable, 1 market-based terms; 2 (B) that— 3 (i) the license holder sells the covered 4 product through agents, distributors, or 5 wholesalers; 6 (ii) the license holder has placed no re- 7 strictions, explicit or implicit, on its agents, 8 distributors, or wholesalers to sell covered 9 products to eligible product developers; and 10 (iii) the covered product can be pur- 11 chased by the eligible product developer in 12 sufficient quantities on commercially rea- 13 sonable, market-based terms from the 14 agents, distributors, or wholesalers of the li- 15 cense holder; or 16 (C) that the license holder made an offer to 17 sell sufficient quantities of the covered product to 18 the eligible product developer at commercially 19 reasonable market-based terms— 20 (i) for a covered product that is not 21 subject to a REMS with ETASU, by the 22 date that is 14 days after the date on which 23 the license holder received the request for the 24 covered product, and the eligible product de- 25 VerDate Sep 11 2014 01:50 May 11, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6203 E:\BILLS\H965.RH H965 pamtmann on DSKBFK8HB2PROD with BILLS 13 •HR 965 RH veloper did not accept such offer by the date 1 that is 7 days after the date on which the 2 eligible product developer received such offer 3 from the license holder; or 4 (ii) for a covered product that is sub- 5 ject to a REMS with ETASU, by the date 6 that is 20 days after the date on [Text truncated for display. 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