Affordable Pricing for Taxpayer-Funded Prescription Drugs Act of 2023

I 118TH CONGRESS 1ST SESSION H. R. 3093 To require persons who undertake federally funded research and development of a biomedical product or service to enter into reasonable pricing agree- ments with the Secretary of Health and Human Services, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MAY 5, 2023 Ms. HOYLE of Oregon (for herself, Mr. DOGGETT, Mr. COHEN, Ms. DELAURO, Mr. GARCI´A of Illinois, Mr. GRIJALVA, Ms. JAYAPAL, Ms. KAPTUR, Mr. KHANNA, Ms. NORTON, Ms. PINGREE, Mr. POCAN, Ms. SCHAKOWSKY, Ms. STANSBURY, and Ms. TOKUDA) introduced the fol- lowing bill; which was referred to the Committee on Energy and Com- merce A BILL To require persons who undertake federally funded research and development of a biomedical product or service to enter into reasonable pricing agreements with the Sec- retary of Health and Human Services, 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 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Affordable Pricing for 4 Taxpayer-Funded Prescription Drugs Act of 2023’’. 5 VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB 2 •HR 3093 IH SEC. 2. REASONABLE PRICE AGREEMENT. 1 (a) IN GENERAL.—All Federal agencies providing or 2 receiving research funding, through a grant, contract, co- 3 operative agreement, or other agreement, shall require in 4 such agreement, and in any license of the rights to a pat- 5 ent or regulatory test data for a biomedical product or 6 service, that the price of any biomedical product or service 7 developed with the benefit of such research be reasonable 8 (as determined by the Secretary) unless the Secretary 9 waives such reasonable price obligation under subsection 10 (d). 11 (b) PROHIBITION AGAINST CHARGING PRICES HIGH- 12 ER THAN IN OTHER LARGE ECONOMIES WITH HIGH IN- 13 COMES.— 14 (1) IN GENERAL.—For purposes of subsection 15 (a), any reasonable pricing formula shall ensure, 16 without prejudice to any other standards or nego- 17 tiated provisions for reasonable pricing, that resi- 18 dents of the United States are not charged more for 19 the biomedical product or service involved than the 20 reference price for countries with large economies 21 and high incomes. 22 (2) REFERENCE PRICE.—For purposes of para- 23 graph (1), the phrase ‘‘reference price for countries 24 with large economies and high incomes’’ means— 25 VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB 3 •HR 3093 IH (A) the median price charged for the bio- 1 medical product or service involved in Canada 2 and the additional six reference countries; or 3 (B) a modification to such price that is 4 adopted by regulation after providing notice 5 and the opportunity for the public to comment, 6 if the Secretary determines such modification to 7 be an appropriate and reasonable measure to 8 protect United States residents from paying 9 prices that are higher than prices in other coun- 10 tries with large economies and high incomes. 11 (c) ADDITIONAL REQUIREMENTS.— 12 (1) IN GENERAL.—In carrying out subsection 13 (a), the Secretary may promulgate by regulation ad- 14 ditional requirements to ensure that the price for the 15 biomedical product or service described in subsection 16 (a) be reasonable. 17 (2) REQUIREMENTS.—The additional require- 18 ments under paragraph (1) shall— 19 (A) address the public interest in ensuring 20 that publicly supported innovations for bio- 21 medical products and services have reasonable 22 prices; and 23 (B) take into account— 24 VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB 4 •HR 3093 IH (i) the importance of providing robust 1 incentives to invest in biomedical research 2 and development; and 3 (ii) the challenges of administering 4 agreements described in subsection (a), in- 5 cluding in cases where third parties control 6 relevant intellectual property, know-how, or 7 other assets. 8 (3) POSSIBLE MECHANISMS.—The additional 9 requirements for reasonable pricing authorized by 10 paragraph (1) may include— 11 (A) mechanisms to— 12 (i) lower prices or shorten exclusivity 13 periods when revenues exceed targets; 14 (ii) lower prices that exceed a stand- 15 ard of cost per health benefit achieved; or 16 (iii) lower prices that constitute sig- 17 nificant barriers to access or fiscal burdens 18 on patients; or 19 (B) a combination of mechanisms listed in 20 subparagraph (A) or other mechanisms. 21 (d) WAIVER.— 22 (1) IN GENERAL.—The Secretary may waive 23 part or all of a reasonable pricing obligation under 24 this section upon a demonstration that such a waiver 25 VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB 5 •HR 3093 IH is in the public interest. A decision to grant such a 1 waiver shall set out the Secretary’s finding that the 2 waiver is in the public interest. 3 (2) REQUIRED PROCESS.—No waiver under 4 paragraph (1) shall take effect before— 5 (A) the public is given notice of the pro- 6 posed waiver and provided a reasonable oppor- 7 tunity to comment in writing and at a public 8 hearing on the proposed waiver; and 9 (B) the Secretary publishes an economic 10 analysis to justify the waiver. 11 (e) TRANSPARENCY.— 12 (1) REPORTING.—In order to evaluate addi- 13 tional requirements promulgated under subsection 14 (c), agreements subject to subsection (a) shall in- 15 clude a requirement that the manufacturer or other 16 companies commercializing the biomedical product 17 or service involved report to the Secretary in formats 18 determined by the Secretary— 19 (A) the costs of each clinical trial under- 20 taken to support the Federal regulatory ap- 21 proval of the biomedical product or service in- 22 volved; 23 (B) subsidies of those costs by the Federal 24 Government; and 25 VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB 6 •HR 3093 IH (C) the annual revenues generated by the 1 biomedical product or service involved, by coun- 2 ty of sale. 3 (2) PUBLIC AVAILABILITY.—The Secretary 4 shall make all reports under paragraph (1) publicly 5 available. 6 (f) NO EFFECT ON OTHER REQUIREMENTS.—The 7 reasonable pricing requirements imposed under this sec- 8 tion are in addition to any other requirements to limit the 9 price of biomedical products or services, including such re- 10 quirements imposed— 11 (1) through standards or negotiated provisions 12 on pricing in contracts; or 13 (2) under chapter 18 of title 35, United States 14 Code, to make the benefits of inventions funded by 15 the Federal Government available to the public on 16 reasonable terms. 17 (g) DEFINITIONS.—In this section: 18 (1) The term ‘‘biomedical product or service’’ 19 means a drug, vaccine, medical device, diagnostic 20 test, assistive technology, cell- or gene-based ther- 21 apy, or other technology used to provide health care. 22 (2) The term ‘‘medical device’’ has the meaning 23 given to the term ‘‘device’’ in section 201 of the 24 VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB 7 •HR 3093 IH Federal Food, Drug, and Cosmetic Act (21 U.S.C. 1 321). 2 (3) The term ‘‘Secretary’’ means the Secretary 3 of Health and Human Services. 4 (4) The term ‘‘six reference countries’’ means 5 the six countries, excluding Canada, that over the 6 previous three calendar years— 7 (A) are member countries of the 8 Organisation for Economic Co-operation and 9 Development; 10 (B) have the largest gross domestic prod- 11 ucts; and 12 (C) have a per capita income that is at 13 least 50 percent of the average per capita in- 14 come of the United States. 15 Æ VerDate Sep 11 2014 23:50 May 17, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H3093.IH H3093 pbinns on DSKJLVW7X2PROD with $$_JOB