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[DOCID: f:s754is.txt]






107th CONGRESS
  1st Session
                                 S. 754

To enhance competition for prescription drugs by increasing the ability 
 of the Department of Justice and Federal Trade Commission to enforce 
 existing antitrust laws regarding brand name drugs and generic drugs.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 6, 2001

    Mr. Leahy (for himself, Mr. Kohl, Mr. Schumer, and Mr. Durbin) 
introduced the following bill; which was read twice and referred to the 
                       Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
To enhance competition for prescription drugs by increasing the ability 
 of the Department of Justice and Federal Trade Commission to enforce 
 existing antitrust laws regarding brand name drugs and generic drugs.

    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 ``Drug Competition Act of 2001''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) prescription drug costs are increasing at an alarming 
        rate and are a major worry of senior citizens and American 
        families;
            (2) there is a potential for drug companies owning patents 
        on brand-name drugs to enter into private financial deals with 
        generic drug companies in a manner that could tend to restrain 
        trade and greatly reduce competition and increase prescription 
        drug costs for American citizens; and
            (3) enhancing competition between generic drug 
        manufacturers and brand name manufacturers can significantly 
        reduce prescription drug costs to American families.

SEC. 3. PURPOSE.

    The purposes of this Act are--
            (1) to provide timely notice to the Department of Justice 
        and the Federal Trade Commission regarding agreements between 
        companies owning patents on branded drugs and companies who 
        could manufacture generic or bioequivalent versions of such 
        branded drugs; and
            (2) by providing timely notice, to--
                    (A) enhance the effectiveness and efficiency of the 
                enforcement of the antitrust laws of the United States; 
                and
                    (B) deter pharmaceutical companies from engaging in 
                anticompetitive actions or actions that tend to 
                unfairly restrain trade.

SEC. 4. DEFINITIONS.

    In this Act:
            (1) Agreement.--The term ``agreement'' means an agreement 
        under section 1 of the Sherman Act (15 U.S.C. 1) or section 5 
        of the Federal Trade Commission Act (15 U.S.C. 45).
            (2) Antitrust laws.--The term ``antitrust laws'' has the 
        same meaning as in section 1 of the Clayton Act (15 U.S.C. 12), 
        except that such term includes section 5 of the Federal Trade 
        Commission Act (15 U.S.C. 45) to the extent that such section 
        applies to unfair methods of competition.
            (3) ANDA.--The term ``ANDA'' means an Abbreviated New Drug 
        Application, as defined under section 505(j) of the Federal 
        Food, Drug and Cosmetic Act.
            (4) Brand name drug company.--The term ``brand name drug 
        company'' means a person engaged in the manufacture or 
        marketing of a drug approved under section 505(b) of the 
        Federal Food, Drug and Cosmetic Act.
            (5) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (6) FDA.--The term ``FDA'' means the United States Food and 
        Drug Administration.
            (7) Generic drug.--The term ``generic drug'' is a product 
        that the Food and Drug Administration has approved under 
        section 505(j) of the Federal Food, Drug and Cosmetic Act.
            (8) Generic drug applicant.--The term ``generic drug 
        applicant'' means a person who has filed or received approval 
        for an ANDA under section 505(j) of the Federal Food, Drug and 
        Cosmetic Act.
            (9) NDA.--The term ``NDA'' means a New Drug Application, as 
        defined under section 505(b) et seq. of the Federal Food, Drug 
        and Cosmetic Act (21 U.S.C. 355(b) et seq.)

SEC. 5. NOTIFICATION OF AGREEMENTS AFFECTING THE SALE OR MARKETING OF 
              GENERIC DRUGS.

    A brand name drug manufacturer and a generic drug manufacturer that 
enter into an agreement regarding the sale or manufacture of a generic 
drug equivalent of a brand name drug that is manufactured by that brand 
name manufacturer and which agreement could have the effect of 
limiting--
            (1) the research, development, manufacture, marketing or 
        selling of a generic drug product that could be approved for 
        sale by the FDA pursuant to the ANDA; or
            (2) the research, development, manufacture, marketing or 
        selling of a generic drug product that could be approved by the 
        FDA;
both shall file with the Commission and the Attorney General the text 
of the agreement, an explanation of the purpose and scope of the 
agreement and an explanation of whether the agreement could delay, 
restrain, limit, or in any way interfere with the production, 
manufacture or sale of the generic version of the drug in question.

SEC. 6. FILING DEADLINES.

    Any notice, agreement, or other material required to be filed under 
section 5 shall be filed with the Attorney General and the FTC not 
later than 10 business days after the date the agreements are executed.

SEC. 7. ENFORCEMENT.

    (a) Civil Fine.--Any person, or any officer, director, or partner 
thereof, who fails to comply with any provision of this Act shall be 
liable for a civil penalty of not more than $20,000 for each day during 
which such person is in violation of this Act. Such penalty may be 
recovered in a civil action brought by the United States, or brought by 
the Commission in accordance with the procedures established in section 
16(a)(1) of the Federal Trade Commission Act (15 U.S.C. 56(a)).
    (b) Compliance and Equitable Relief.--If any person, or any 
officer, director, partner, agent, or employee thereof, fails to comply 
with the notification requirement under section 5 of this Act, the 
United States district court may order compliance, and may grant such 
other equitable relief as the court in its discretion determines 
necessary or appropriate, upon application of the Commission or the 
Assistant Attorney General.

SEC. 8. RULEMAKING.

    The Commission, with the concurrence of the Assistant Attorney 
General and by rule in accordance with section 553 of title 5, 
consistent with the purposes of this Act--
            (1) may require that the notice described in section 5 of 
        this Act be in such form and contain such documentary material 
        and information relevant to the agreement as is necessary and 
        appropriate to enable the Commission and the Assistant Attorney 
        General to determine whether such agreement may violate the 
        antitrust laws;
            (2) may define the terms used in this Act;
            (3) may exempt classes of persons or agreements from the 
        requirements of this Act; and
            (4) may prescribe such other rules as may be necessary and 
        appropriate to carry out the purposes of this Act.

SEC. 9. EFFECTIVE DATES.

    This Act shall take effect 90 days after the date of enactment of 
this Act.
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