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Text of H.R. 1561

HR 1561 IH

110th CONGRESS

1st Session

H. R. 1561
To amend the Public Health Service Act and the Federal Food, Drug, and Cosmetic Act to improve drug safety and oversight, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

March 19, 2007
Mr. WAXMAN (for himself and Mr. MARKEY) introduced the following bill; which was referred to the Committee on Energy and Commerce

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A BILL
To amend the Public Health Service Act and the Federal Food, Drug, and Cosmetic Act to improve drug safety and oversight, 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 `Enhancing Drug Safety and Innovation Act of 2007′.

SEC. 2. TABLE OF CONTENTS.

The table of contents for this Act is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

TITLE I–RISK EVALUATION AND MITIGATION STRATEGIES

Sec. 101. Risk evaluation and mitigation strategies.

Sec. 102. Enforcement.

Sec. 103. Regulation of biological products.

Sec. 104. No effect on withdrawal or suspension of approval.

Sec. 105. Drugs subject to an abbreviated new drug application.

Sec. 106. Conforming amendments.

Sec. 107. Resources.

Sec. 108. Drug labeling.

Sec. 109. Factory inspections.

Sec. 110. Study on integration of expertise of Office of Surveillance and Epidemiology.

Sec. 111. Benefit-risk assessments.

Sec. 112. Effective date and applicability.

Sec. 113. Rule of construction regarding pediatric studies.

Sec. 114. Authorization of appropriations.

TITLE II–REAGAN-UDALL INSTITUTE FOR APPLIED BIOMEDICAL RESEARCH

Sec. 201. The Reagan-Udall Institute for Applied Biomedical Research.

TITLE III–CLINICAL TRIALS

Sec. 301. Clinical trial registry database and clinical trial results database.

TITLE IV–CONFLICTS OF INTEREST

Sec. 401. Conflicts of interest.

TITLE I–RISK EVALUATION AND MITIGATION STRATEGIES

SEC. 101. RISK EVALUATION AND MITIGATION STRATEGIES.

Section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) is amended by adding at the end the following:

`(o) Risk Evaluation and Mitigation Strategy-

`(1) IN GENERAL- In the case of any drug subject to subsection (b) or to section 351 of the Public Health Service Act for which a risk evaluation and mitigation strategy is approved as provided for in this subsection, the applicant shall comply with the requirements of such strategy.

`(2) DEFINITIONS- In this subsection:

`(A) ADVERSE DRUG EXPERIENCE- The term `adverse drug experience’ means any adverse event associated with the use of a drug in humans, whether or not considered drug related, including–

`(i) an adverse event occurring in the course of the use of the drug in professional practice;

`(ii) an adverse event occurring from an overdose of the drug, whether accidental or intentional;

`(iii) an adverse event occurring from abuse of the drug;

`(iv) an adverse event occurring from withdrawal of the drug; and

`(v) any failure of expected pharmacological action of the drug.

`(B) SERIOUS ADVERSE DRUG EXPERIENCE- The term `serious adverse drug experience’ is an adverse event that–

`(i) results in–

`(I) death;

`(II) an adverse drug experience that places the patient at immediate risk of death from the adverse drug experience as it occurred (not including an adverse drug experience that might have caused death had it occurred in a more severe form);

`(III) inpatient hospitalization or prolongation of existing hospitalization;

`(IV) a persistent or significant incapacity or substantial disruption of the ability to conduct normal life functions; or

`(V) a congenital anomaly or birth defect; or

`(ii) based on appropriate medical judgment, may jeopardize the patient and may require a medical or surgical intervention to prevent an outcome described under clause (i).

`(C) SERIOUS RISK- The term `serious risk’ means a risk of a serious adverse drug experience.

`(D) UNEXPECTED SERIOUS RISK- The term `unexpected serious risk’ means a serious adverse drug experience that is not listed in the labeling of a drug, or that may be symptomatically and pathophysiologically related to an adverse drug experience identified in the labeling, but differs from such adverse drug experience because of greater severity, specificity, or prevalence.

`(E) SIGNAL OF A SERIOUS RISK- The term `signal of a serious risk’ means information related to a serious adverse drug experience associated with use of a drug and derived from–

`(i) a clinical trial;

`(ii) adverse event reports;

`(iii) a post-approval study, including a study under paragraph (4)(D); or

`(iv) peer-reviewed biomedical literature.

`(F) NEW SAFETY INFORMATION- The term `new safety information’ with respect to a drug means information about–

`(i) a serious risk or an unexpected serious risk associated with use of the drug that the Secretary has become aware of since the last assessment of the approved risk evaluation and mitigation strategy for the drug; or

`(ii) the effectiveness of the approved risk evaluation and mitigation strategy for the drug obtained since the last assessment of such strategy.

`(3) REQUIRED ELEMENTS OF A RISK EVALUATION AND MITIGATION STRATEGY- The risk evaluation and mitigation strategy for a drug shall require–

`(A)(i) labeling for the drug for use by health care providers as approved under subsection (c); and

`(ii) for the first 2 years (or for such period as the Secretary determines on a case-by-case basis to be appropriate) after the drug or a new indication for the drug is approved, inclusion in the labeling and any direct-to-consumer advertisements of a unique symbol indicating the newly approved status of the drug or indication;

`(B)(i) submission of reports for the drug as required under subsection (k); and

`(ii) for a drug that is a vaccine–

`(I) analysis of reports to the Vaccine Adverse Event Reporting Systems (VAERS); or

`(II) surveillance using the Vaccine Safety Datalink (VSD) or successor databases;

`(C) a pharmacovigilance statement–

`(i) as to whether the reports under subparagraph (B)(i) or, for a vaccine, the analysis and surveillance under subparagraph (B)(ii), and the periodic assessment under subparagraph (E), are sufficient to assess the serious risks and to identify unexpected serious risks of the drug; and

`(ii) if such reports, such analysis and surveillance, and such periodic assessment are not sufficient to assess the serious risks and to identify unexpected serious risks of the drug, that describes what study or studies of the drug are required under paragraph (4)(D) or what clinical trial or trials of the drug are required under paragraph (4)(E);

`(D) a justification for the pharmacovigilance statement in subparagraph (C) that takes into consideration–

`(i) the estimated size of the treatment population for the drug;

`(ii) the seriousness of the disease or condition that the drug is used to treat or prevent;

`(iii) the expected or actual duration of treatment with the drug;

`(iv) the availability and safety of a drug or other treatment, if any, for such disease or condition to which the safety of the drug may be compared; and

`(v) the seriousness of the risk at issue and its background incidence in the population; and

`(E) a timetable for submission of assessments of the strategy, that–

`(i) shall be no less frequently than once annually for the first 3 years after the drug is initially approved under subsection (c) or licensed under section 351 of the Public Health Service Act;

`(ii) shall include an assessment in the seventh year after the drug is so approved; and

`(iii) subject to clause (ii), for subsequent years–

`(I) shall be at a frequency specified in the strategy;

`(II) may be increased or reduced in frequency as necessary as provided for in paragraph (6)(B)(iv)(VI); and

`(III) may be eliminated after the 3-year period described in clause (i) if the Secretary determines that serious risks of the drug have been adequately identified and assessed and are being adequately managed.

`(4) ADDITIONAL POTENTIAL ELEMENTS OF A RISK EVALUATION AND MITIGATION STRATEGY-

`(A) IN GENERAL- The Secretary may require that the risk evaluation and mitigation strategy for a drug include 1 or more of the additional elements described in this paragraph, so long as the Secretary makes the determination required with respect to each additional included element.

`(B) MEDGUIDE; PATIENT PACKAGE INSERT- The risk evaluation and mitigation strategy for a drug may require that the applicant develop for distribution to each patient when the drug is dispensed–

`(i) a Medication Guide, as provided for under part 208 of title 21, Code of Federal Regulations (or any successor regulations); or

`(ii) a patient package insert, if the Secretary determines that such insert may help mitigate a serious risk of the drug.

`(C) COMMUNICATION PLAN- The risk evaluation and mitigation strategy for a drug may require that the applicant conduct a communication plan to health care providers, if, with respect to such drug, the Secretary determines that such plan may support implementation of an element of the strategy. Such plan may include–

`(i) sending letters to health care providers;

`(ii) disseminating information about the elements of the risk evaluation and mitigation strategy to encourage implementation by health care providers of components that apply to such health care providers, or to explain certain safety protocols (such as medical monitoring by periodic laboratory tests); or

`(iii) disseminating information to health care providers through professional societies about any serious risks of the drug and any protocol to assure safe use.

`(D) POST-APPROVAL STUDIES- The risk evaluation and mitigation strategy for a drug may require that the applicant conduct, or provide that the Secretary will conduct, an appropriate post-approval study, such as a prospective or retrospective observational study (including through the systematic use of established health care networks and databases), of the drug (with a target schedule for completing the study and reporting the results to the Secretary), if the Secretary determines the reports, analysis and surveillance, and periodic assessments referred to in paragraph (3)(C) are not sufficient to–

`(i) assess evidence of a serious risk related to the safety or effectiveness of the drug; or

`(ii) identify unexpected serious risks in domestic populations who use the drug, including populations not included in studies used to approve the drug (such as older people, people with comorbidities, pregnant women, or children).

`(E) POST-APPROVAL CLINICAL TRIALS- The risk evaluation and mitigation strategy for a drug may require that the applicant for a drug for which there is no effective approved application under subsection (j) of this section as of the date that the requirement is first imposed conduct an appropriate post-approval clinical trial of the drug (with a target schedule for completing the clinical trial and reporting the results to the Secretary) to be included in the clinical trial registry database and clinical trial results database provided for under section 402(i) of the Public Health Service Act, if the Secretary determines that a study or studies under subparagraph (D) will likely be inadequate to assess evidence of a serious risk related to the safety or effectiveness of the drug.

`(F) PRECLEARANCE-

`(i) IN GENERAL- The risk evaluation and mitigation strategy for a drug may require that the applicant submit to the Secretary advertisements of the drug for preclearance, if the Secretary determines that such preclearance is necessary to ensure compliance with section 502(n) with respect to the disclosure of information about a serious risk listed in the labeling of the drug. The advertisements required to be submitted under the preceding sentence shall be reviewed and cleared by the Secretary within 45 days of submission.

`(ii) SPECIFICATION OF ADVERTISEMENTS- The Secretary may specify the advertisements required to be submitted under clause (i).

`(G) SPECIFIC DISCLOSURES-

`(i) IN GENERAL- The risk evaluation and mitigation strategy for a drug may require that the applicant include in advertisements of the drug a specific disclosure–

`(I) of the date the drug was approved and that the existing information may not have identified or allowed for full assessment of all serious risks of using the drug, if the Secretary determines that such disclosure is necessary to protect public health and safety; or

`(II) about a serious adverse event listed in the labeling of the drug or a protocol to ensure safe use described in the labeling of the drug, if the Secretary determines that such advertisements lacking such disclosure would be false or misleading.

`(ii) SPECIFICATION OF ADVERTISEMENTS- The Secretary may specify the advertisements required to include a specific disclosure under clause (i).

`(H) TEMPORARY MORATORIUM- The risk evaluation and mitigation strategy for a drug may require that for a fixed period after initial approval, not to exceed 3 years, the applicant not issue or cause to be issued direct-to-consumer advertisements of the drug, if the Secretary determines that disclosure under subparagraph (G) is inadequate to protect public health and safety, and that such prohibition is necessary to protect public health and safety while additional information about serious risks of the drug is collected, considering–

`(i) the number of patients who may be treated with the drug;

`(ii) the seriousness of the condition for which the drug will be used;

`(iii) the serious adverse events listed in the labeling of the drug;

`(iv) the extent to which patients have access to other approved drugs in the pharmacological class of the drug and with the same intended use as the drug; and

`(v) the extent to which clinical trials used to approve the drug may not have identified serious risks that might occur among patients expected to be treated with the drug.

`(5) RESTRICTIONS ON DISTRIBUTION OR USE-

`(A) IN GENERAL- If the Secretary determines that a drug shown to be effective can be safely used only if distribution or use of such drug is restricted, the Secretary may require as elements of the risk evaluation and mitigation strategy such restrictions on distribution or use as are needed to ensure safe use of the drug.

`(B) LIMITS ON RESTRICTIONS- Such restrictions under subparagraph (A) shall–

`(i) be commensurate with the specific risk presented by the drug;

`(ii) not be unduly burdensome on patient access to the drug, particularly for patients with serious or life-threatening diseases or conditions; and

`(iii) to the extent practicable, conform with restrictions on distribution or use for other drugs with similar risks, so as to minimize the burden on the health care delivery system.

`(C) ELEMENTS- The restrictions on distribution or use described in subparagraph (A) shall include 1 or more goals to evaluate or mitigate a serious risk listed in the labeling of the drug and may require that–

`(i) health care providers that prescribe the drug have special training or experience, or are specially certified;

`(ii) pharmacies, practitioners, or health care settings that dispense the drug are specially certified;

`(iii) the drug be dispensed to patients only in certain health care settings, such as hospitals;

`(iv) the drug be dispensed to patients with evidence or other documentation of safe-use conditions, such as laboratory test results;

`(v) each patient using the drug be subject to certain monitoring; or

`(vi) each patient using the drug be enrolled in a registry.

`(D) IMPLEMENTATION SYSTEM- The restrictions on distribution or use described in subparagraph (A) may require a system through which the applicant is able to–

`(i) monitor and evaluate implementation of the restrictions by health care providers, pharmacists, patients, and other parties in the health care system who are responsible for implementing the restrictions;

`(ii) work to improve implementation of the restrictions by health care providers, pharmacists, patients, and other parties in the health care system who are responsible for implementing the restrictions; and

`(iii) stop distribution of the drug to those health care providers, pharmacists, and other parties in the health care system–

`(I) who are responsible for implementing the restrictions; and

`(II) whom the applicant knows have failed to meet their responsibilities for implementing the restrictions, after the applicant has informed such party of such failure and such party has not remedied such failure.

`(E) PATENTS- The Secretary shall not approve a risk evaluation and mitigation strategy for a drug, or any modification to the strategy, under paragraph (6) if–

`(i) the strategy includes a restriction on distribution or use described in subparagraph (A) that is protected by a patent;

`(ii) such patent was issued after the date of the enactment of this subsection; and

`(iii) such patent would prohibit or impair the application of such restriction under section 505(j)(2)(E)(i)(VII) to a drug that is the subject of an abbreviated new drug application.

`(6) SUBMISSION AND REVIEW OF RISK EVALUATION AND MITIGATION STRATEGY-

`(A) PROPOSED RISK EVALUATION AND MITIGATION STRATEGY-

`(i) INITIAL APPROVAL- An applicant shall include a proposed risk evaluation and mitigation strategy in an application under subsection (b) or section 351 of the Public Health Service Act for initial approval of the drug.

`(ii) APPROVAL OF NEW INDICATION- If no risk evaluation and mitigation strategy for the drug is in effect under this subsection and the drug may not be dispensed without a prescription, the applicant shall include a proposed risk evaluation and mitigation strategy in an application, including in a supplemental application, seeking a new indication for such drug.

`(iii) CONTENTS- A proposed risk evaluation and mitigation strategy–

`(I) shall include the minimal elements required under paragraph (3); and

`(II) may also include additional elements as provided for under paragraphs (4) and (5).

`(B) ASSESSMENT AND MODIFICATION OF A RISK EVALUATION AND MITIGATION STRATEGY-

`(i) VOLUNTARY ASSESSMENTS- The applicant may submit to the Secretary an assessment of, and propose a modification to, the approved risk evaluation and mitigation strategy for a drug at any time.

`(ii) REQUIRED ASSESSMENTS- The applicant shall submit an assessment of, and may propose a modification to, the approved risk evaluation and mitigation strategy for a drug–

`(I) when submitting a supplemental application for a new indication under subsection (b) or section 351 of the Public Health Service Act, unless the drug may be dispensed without a prescription and the risk evaluation and mitigation strategy for the drug includes only the elements under paragraph (3);

`(II) when required by the strategy, as provided for in the timetable under paragraph (3)(E);

`(III) within a time specified by the Secretary, not to be less than 45 days, when ordered by the Secretary, if the Secretary determines that new safety or effectiveness information indicates that an element under paragraph (3) or (4) should be modified or included in the strategy;

`(IV) within 90 days when ordered by the Secretary, if the Secretary determines that new safety or effectiveness information indicates that an element under paragraph (5) should be modified or included in the strategy; or

`(V) within 15 days when ordered by the Secretary, if the Secretary determines that there may be a cause for action by the Secretary under subsection (e).

`(iii) ASSESSMENT- An assessment of the approved risk evaluation and mitigation strategy for a drug shall include–

`(I) with respect to any goal under paragraph (5), an assessment of how well the restrictions on distribution or use are meeting the goal or whether the goal or such restrictions should be modified;

`(II) with respect to any post-approval study required under paragraph (4)(D), the status of such study, including whether any difficulties completing the study have been encountered; and

`(III) with respect to any post-approval clinical trial required under paragraph (4)(E), the status of such clinical trial, including whether enrollment has begun, the number of participants enrolled, the expected completion date, whether any difficulties completing the clinical trial have been encountered, and registration information with respect to requirements under section 402(i) of the Public Health Service Act.

`(iv) MODIFICATION- A modification (whether an enhancement or a reduction) to the approved risk evaluation and mitigation strategy for a drug may include the addition or modification of any element under subparagraph (A), (C), or (D) of paragraph (3) or the addition, modification, or removal of any element under paragraph (4) or (5), such as–

`(I) a labeling change, including the addition of a boxed warning;

`(II) adding a post-approval study or clinical trial requirement;

`(III) modifying a post-approval study or clinical trial requirement (such as a change in trial design due to legitimate difficulties recruiting participants);

`(IV) adding, modifying, or removing a restriction on advertising under subparagraph (F), (G), and (H) of paragraph (4);

`(V) adding, modifying, or removing a restriction on distribution or use under paragraph (5); or

`(VI) modifying the timetable for assessments of the strategy under paragraph (3)(E), including to eliminate assessments.

`(C) REVIEW-

`(i) IN GENERAL- The Secretary shall promptly review the proposed risk evaluation and mitigation strategy for a drug submitted under subparagraph (A), or an assessment of the approved risk evaluation and mitigation strategy for a drug submitted under subparagraph (B).

`(ii) MARKETING PLAN- As part of a review conducted under this subparagraph, the Secretary may require the applicant to submit its marketing plan for the drug, so as to allow the Secretary to determine whether any of the proposed or ongoing marketing activities undermine any of the requirements of the risk evaluation and mitigation strategy.

`(D) DISCUSSION- The Secretary shall initiate discussions of the proposed risk evaluation and mitigation strategy for a drug submitted under subparagraph (A), or of an assessment of the approved risk evaluation and mitigation strategy for a drug submitted under subparagraph (B), with the applicant to determine a strategy–

`(i) if the proposed strategy or assessment is submitted as part of an application or supplemental application under subparagraph (A) or (B)(ii)(I), not less than 60 days before the action deadline for the application that has been agreed to by the Secretary and that has been set forth in goals identified in letters of the Secretary (relating to the use of fees collected under section 736 to expedite the drug development process and the review of human drug applications);

`(ii) if the assessment is submitted under subclause (II) or (III) of subparagraph (B)(ii), not later than 20 days after such submission;

`(iii) if the assessment is submitted under subparagraph (B)(i) or under subparagraph (B)(ii)(IV), not later than 30 days after such submission; or

`(iv) if the assessment is submitted under subparagraph (B)(ii)(V), not later than 10 days after such submission.

`(E) ACTION-

`(i) IN GENERAL- Unless the applicant requests the dispute resolution process described under subparagraph (F), the Secretary shall approve and describe the risk evaluation and mitigation strategy for a drug, or any modification to the strategy–

`(I) as part of the action letter on the application, when a proposed strategy is submitted under subparagraph (A) or an assessment of the strategy is submitted under subparagraph (B)(ii)(I); or

`(II) in an order issued not later than 50 days after the date discussions of such modification begin under subparagraph (C), when an assessment of the strategy is under subparagraph (B)(i) or under subclause (II), (III), (IV), or (V) of subparagraph (B)(ii).

`(ii) INACTION- An approved risk evaluation and mitigation strategy shall remain in effect until the Secretary acts, if the Secretary fails to act as provided under clause (i).

`(iii) PUBLIC AVAILABILITY- Any action letter described in clause (i)(I) or order described in clause (i)(II) shall be made publicly available.

`(F) DISPUTE RESOLUTION-

`(i) REQUEST FOR REVIEW- Not earlier than 15 days, and not later than 35 days, after discussions under subparagraph (D) have begun, the applicant may request in writing that a dispute about the strategy be reviewed by the Drug Safety Oversight Board. Upon receipt of such a request, the Secretary shall schedule the dispute for review under clause (ii) and, not later than 5 business days of scheduling the dispute for review, shall publish by posting on the Internet or otherwise a notice that the dispute will be reviewed by the Drug Safety Oversight Board.

`(ii) SCHEDULING REVIEW- If the applicant requests review under clause (i), the Secretary–

`(I) shall schedule the dispute for review at 1 of the next 2 regular meetings of the Drug Safety Oversight Board, whichever meeting date is more practicable; or

`(II) may convene a special meeting of the Drug Safety Oversight Board to review the matter more promptly, including to meet an action deadline on an application (including a supplemental application).

`(iii) AGREEMENT AFTER DISCUSSION OR ADMINISTRATIVE APPEALS-

`(I) FURTHER DISCUSSION OR ADMINISTRATIVE APPEALS- A request for review under clause (i) shall not preclude further discussions to reach agreement on the risk evaluation and mitigation strategy, and such a request shall not preclude the use of administrative appeals within the Food and Drug Administration to reach agreement on the strategy, including appeals as described in letters of the Secretary (relating to the use of fees collected under section 736 to expedite the drug development process and the review of human drug applications) for procedural or scientific matters involving the review of human drug applications and supplemental applications that cannot be resolved at the divisional level.

`(II) AGREEMENT TERMINATES DISPUTE RESOLUTION- At any time before a decision and order is issued under clause (vii), the Secretary and the applicant may reach an agreement on the risk evaluation and mitigation strategy through further discussion or administrative appeals, terminating the dispute resolution process, and the Secretary shall issue an action letter or order, as appropriate, that describes the strategy.

`(iv) MEETING OF THE BOARD- At the meeting of the Drug Safety Oversight Board described in clause (ii), the Board shall–

`(I) hear from both parties; and

`(II) review the dispute.

`(v) RECORD OF PROCEEDINGS- The Secretary shall ensure that the proceedings of any such meeting are recorded, transcribed, and made public within 30 days of the meeting. The Secretary shall redact the transcript to protect any trade secrets or other confidential information described in section 552(b)(4) of title 5, United States Code.

`(vi) RECOMMENDATION OF THE BOARD- Not later than 5 days after any such meeting, the Drug Safety Oversight Board shall provide a written recommendation on resolving the dispute to the Secretary. Not later than 5 days after the Board provides such written recommendation to the Secretary, the Secretary shall make the recommendation available to the public.

`(vii) ACTION BY THE SECRETARY-

`(I) ACTION LETTER- With respect to a proposed risk evaluation and mitigation strategy submitted under subparagraph (A) or to an assessment of the strategy submitted under subparagraph (B)(ii)(I), the Secretary shall issue an action letter that resolves the dispute not later than the later of–
`(aa) the action deadline referred to in subparagraph (D)(i); or

`(bb) 7 days after receiving the recommendation of the Drug Safety Oversight Board.

`(II) ORDER- With respect to an assessment of the risk evaluation and mitigation strategy under subparagraph (B)(i) or under subclause (II), (III), (IV), or (V) of subparagraph (B)(ii), the Secretary shall issue an order, which shall be made public, that resolves the dispute not later than 7 days after receiving the recommendation of the Drug Safety Oversight Board.

`(viii) INACTION- An approved risk evaluation and mitigation strategy shall remain in effect until the Secretary acts, if the Secretary fails to act as provided for under clause (vii).

`(ix) EFFECT ON ACTION DEADLINE- With respect to the application or supplemental application in which a proposed risk evaluation and mitigation strategy is submitted under subparagraph (A) or in which an assessment of the strategy is submitted under subparagraph (B)(ii)(I), the Secretary shall be considered to have met the action deadline referred to in subparagraph (D)(i) with respect to such application if the applicant requests the dispute resolution process described in this subparagraph and if the Secretary–

`(I) has initiated the discussions described under subparagraph (D) not less than 60 days before such action deadline; and

`(II) has complied with the timing requirements of scheduling review by the Drug Safety Oversight Board, providing a written recommendation, and issuing an action letter under clauses (ii), (vi), and (vii), respectively.

`(x) DISQUALIFICATION- No individual who is an employee of the Food and Drug Administration and who reviews a drug or who participated in an administrative appeal under clause (iii)(I) with respect to such drug may serve on the Drug Safety Oversight Board at a meeting under clause (iv) to review a dispute about the risk evaluation and mitigation strategy for such drug.

`(xi) ADDITIONAL EXPERTISE- The Drug Safety Oversight Board may add members with relevant expertise from the Food and Drug Administration, including the Office of Pediatrics, the Office of Women’s Health, or the Office of Rare Diseases, or from other Federal public health or health care agencies, for a meeting under clause (iv) of the Drug Safety Oversight Board.

`(G) USE OF ADVISORY COMMITTEES- The Secretary may convene a meeting of 1 or more advisory committees of the Food and Drug Administration to–

`(i) review a concern about the safety of a drug or class of drugs, including before an assessment of the risk evaluation and mitigation strategy or strategies of such drug or drugs is required to be submitted under subclause (II), (III), (IV), or (V) of subparagraph (B)(ii);

`(ii) review the risk evaluation and mitigation strategy or strategies of a drug or group of drugs; or

`(iii) review a dispute under subparagraph (F).

`(H) PROCESS FOR ADDRESSING DRUG CLASS EFFECTS-

`(i) IN GENERAL- When a concern about a serious risk of a drug may be related to the pharmacological class of the drug, the Secretary may defer assessments of the approved risk evaluation and mitigation strategies for such drugs until the Secretary has convened 1 or more public meetings to consider possible responses to such concern. If the Secretary defers an assessment under this clause, the Secretary shall give notice to the public of the deferral not later than 5 days of the deferral.

`(ii) PUBLIC MEETINGS- Such public meetings may include–

`(I) 1 or more meetings of the applicants for such drugs;

`(II) 1 or more meetings of 1 or more advisory committees of the Food and Drug Administration, as provided for under subparagraph (G); or

`(III) 1 or more workshops of scientific experts and other stakeholders.

`(iii) ACTION- After considering the discussions from any meetings under clause (ii), the Secretary may–

`(I) announce in the Federal Register a planned regulatory action, including a modification to each risk evaluation and mitigation strategy, for drugs in the pharmacological class;

`(II) seek public comment about such action; and

`(III) after seeking such comment, issue an order addressing such regulatory action.

`(I) INTERNATIONAL COORDINATION- The Secretary may coordinate the timetable for submission of assessments under paragraph (3)(E), a study under paragraph (4)(D), or a clinical trial under paragraph (4)(E), with efforts to identify and assess the serious risks of such drug by the marketing authorities of other countries whose drug approval and risk management processes the Secretary deems comparable to the drug approval and risk management processes of the United States. If the Secretary takes action to coordinate such timetable, the Secretary shall give notice to the public of the action not later than 5 days after the action.

`(J) EFFECT- Use of the processes described in subparagraphs (H) and (I) shall not delay action on an application or a supplement to an application for a drug.

`(K) NO EFFECT ON LABELING CHANGES THAT DO NOT REQUIRE PREAPPROVAL- In the case of a labeling change to which section 314.70 of title 21, Code of Federal Regulations (or any successor regulation), applies for which the submission of a supplemental application is not required or for which distribution of the drug involved may commence upon the receipt by the Secretary of a supplemental application for the change, the submission of an assessment of the approved risk evaluation and mitigation strategy for the drug under this subsection is not required.

`(7) DRUG SAFETY OVERSIGHT BOARD-

`(A) IN GENERAL- There is established a Drug Safety Oversight Board.

`(B) COMPOSITION; MEETINGS- The Drug Safety Oversight Board shall–

`(i) be composed of scientists and health care practitioners appointed by the Secretary, each of whom is an employee of the Federal Government;

`(ii) include representatives from offices throughout the Food and Drug Administration;

`(iii) include at least 1 representative from each of the National Institutes of Health, the Department of Health and Human Services (other than the Food and Drug Administration), and the Veterans Health Administration; and

`(iv) meet at least monthly to provide oversight and advice to the Secretary on the management of important drug safety issues.’.

SEC. 102. ENFORCEMENT.

(a) Misbranding- Section 502 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 352) is amended by adding at the end the following:

`(y) If it is a drug subject to an approved risk evaluation and mitigation strategy under section 505(o) and the applicant for such drug fails to–

`(1) make a labeling change required by such strategy after the Secretary has completed review of, and acted on, an assessment of such strategy under paragraph (6) of such section; or

`(2) comply with a requirement of such strategy provided for under paragraph (3), (4), or (5) of such section.

`(z) Failure to conduct a postmarket study required under section 506 (or any regulation thereunder).’.

(b) Civil Penalties- Section 303(f) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 333(f)) is amended–

(1) by redesignating paragraphs (3), (4), and (5) as paragraphs (4), (5), and (6), respectively;

(2) by inserting after paragraph (2) the following:

`(3) Any person who violates a requirement of this Act which relates to drugs shall be liable to the United States for a civil penalty in an amount not less than $50,000 for each such violation and, for all such violations adjudicated in a single proceeding, in an amount not to exceed the following:

`(A) For drugs on the market for at least one year, 10 percent of the annual United States sales revenue during the year prior to which the person is subject to the civil penalty, based upon data from IMS Health Inc.’s Retail and Provider Prospective Combined Purchases on the United States sales revenue of the drug or, in the event IMS data is not available, based upon any comparable data.

`(B) For drugs on the market for less than one year, $1,000,000.’;

(3) in paragraph (2)(C), by striking `paragraph (3)(A)’ and inserting `paragraph (4)(A)’;

(4) in paragraph (4), as so redesignated, by striking `paragraph (1) or (2)’ each place it appears and inserting `paragraph (1), (2), or (3)’; and

(5) in paragraph (6), as so redesignated, by striking `paragraph (4)’ each place it appears and inserting `paragraph (5)’.

SEC. 103. REGULATION OF BIOLOGICAL PRODUCTS.

Section 351 of the Public Health Service Act (42 U.S.C. 262) is amended–

(1) in subsection (a)(2), by adding at the end the following:

`(D) Risk Evaluation and Mitigation Strategy- A person that submits an application for a license under this paragraph shall submit to the Secretary as part of the application a proposed risk evaluation and mitigation strategy as described under section 505(o) of the Federal Food, Drug, and Cosmetic Act.’; and

(2) in subsection (j), by inserting `, including the requirements under section 505(o) of such Act,’ after `, and Cosmetic Act’.

SEC. 104. NO EFFECT ON WITHDRAWAL OR SUSPENSION OF APPROVAL.

Section 505(e) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(e)) is amended by adding at the end the following: `The Secretary may withdraw the approval of an application submitted under this section, or suspend the approval of such an application, as provided under this subsection, without first ordering the applicant to submit an assessment of the approved risk evaluation and mitigation strategy for the drug under subsection (o)(6)(B)(ii)(V).’.

SEC. 105. DRUGS SUBJECT TO AN ABBREVIATED NEW DRUG APPLICATION.

Section 505(j)(2) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)(2)) is amended by adding at the end the following:

`(E) Risk Evaluation and Mitigation Strategy Requirement-

`(i) IN GENERAL- A drug that is the subject of an abbreviated new drug application under this subsection shall be subject to only the following elements of the risk evaluation and mitigation strategy required under subsection (o) for the applicable listed drug:

`(I) Labeling, as required under subsection (o)(3)(A) for the applicable listed drug.

`(II) Submission of reports, as required under subsection (o)(3)(B)(i) for the applicable listed drug.

`(III) A Medication Guide or patient package insert, if required under subsection (o)(4)(B) for the applicable listed drug.

`(IV) Preclearance of advertising, if required under subsection (o)(4)(F) for the applicable listed drug.

`(V) Specific disclosures in advertising, if required under subsection (o)(4)(G) for the applicable listed drug.

`(VI) A temporary moratorium on direct-to-consumer advertising, if required under subsection (o)(4)(H) for the applicable listed drug.

`(VII) Restrictions on distribution or use, if required under subsection (o)(5) for the listed drug. A drug that is the subject of an abbreviated new drug application and the listed drug shall use a single, shared system under subsection (o)(5)(D). The Secretary may waive the requirement under the preceding sentence for a drug that is the subject of an abbreviated new drug application if the Secretary determines that (aa) it is not practical for the drug to use such single, shared system or (bb) the burden of using the single, shared system outweighs the benefit of using the single system.

`(ii) ACTION BY SECRETARY- For an applicable listed drug for which a drug is approved under this subsection, the Secretary–

`(I) shall undertake any communication plan to health care providers required under section (o)(4)(C) for the applicable listed drug;

`(II) shall conduct any post-approval study required under subsection (o)(4)(D) for the applicable listed drug; and

`(III) shall inform the applicant for a drug approved under this subsection if the risk evaluation and mitigation strategy for the applicable listed drug is modified.’.

SEC. 106. CONFORMING AMENDMENTS.

(a) Preclearance of Advertisements- Section 502(n)(3)(A) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 352(n)(3)(A)) is amended by inserting `(or when required under section 505(o)(4)(F))’ after `except in extraordinary circumstances’.

(b) Content of New Drug Application- Section 505(b)(1) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(b)) is amended–

(1) in subparagraph (F), by striking `and’; and

(2) in subparagraph (G), by striking the period and inserting the following: `, and (H) a proposed risk evaluation and mitigation strategy as described under subsection (o).’.

SEC. 107. RESOURCES.

(a) User Fees- Subparagraph (F) of section 735(6) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 379g(6)) is amended to read as follows:

`(F) Reviewing and implementing risk evaluation and mitigation strategies, and collecting, developing, and reviewing safety or effectiveness information on drugs, including adverse event reports.’.

(b) Workload Adjustment- Subparagraph (A) of section 736(c)(2) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 379h(c)(2)) is amended to read as follows:

`(A) The adjustment shall be determined by the Secretary based on a weighted average of the change in the total number of human drug applications; commercial investigational new drug applications; efficacy supplements; manufacturing supplements; implementation, assessment, review, and enforcement activities for risk evaluation and mitigation strategies; and uses of dispute resolution under the process for reviewing and assessing risk evaluation and mitigation strategies. The Secretary shall publish in the Federal Register the fee revenues and fees resulting from the adjustment and supporting methodologies.’.

(c) Strategic Plan for Information Technology- Not later than 1 year after the date of enactment of this title, the Secretary of Health and Human Services (referred to in this Act as the `Secretary’) shall submit to the Committee on Health, Education, Labor, and Pensions and the Committee on Appropriations of the Senate and the Committee on Energy and Commerce and the Committee on Appropriations of the House of Representatives, a strategic plan on information technology that includes–

(1) an assessment of the information technology infrastructure, including systems for data collection, access to data in external health care databases (including databases of the Centers for Medicare & Medicaid Services and the Department of Veterans Affairs), data mining capabilities, personnel, and personnel training programs, needed by the Food and Drug Administration to–

(A) comply with the requirements of this title (and the amendments made by this title);

(B) achieve interoperability within and among the Centers of the Food and Drug Administration and between the Food and Drug Administration and product application sponsors; and

(C) utilize electronic health records;

(2) an assessment of the extent to which the current information technology assets of the Food and Drug Administration are sufficient to meet the needs assessments under paragraph (1);

(3) a plan for enhancing the information technology assets of the Food and Drug Administration toward meeting the needs assessments under paragraph (1); and

(4) an assessment of additional resources needed to so enhance the information technology assets of the Food and Drug Administration.

SEC. 108. DRUG LABELING.

(a) Accessible Repository of Drug Labeling- Not later than the effective date of this title, the Secretary, through the Commissioner of Food and Drugs, and the Director of the National Institutes of Health, shall establish a searchable repository of structured, electronic product information (including health warnings, Dear Doctor letters, and the approved professional labeling and any required patient labeling of each drug approved under section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or licensed under section 351 of the Public Health Service Act (42 U.S.C. 262)) in order to improve patient safety through accessible product information, support initiatives to improve patient care by better management of health care information, and provide standards for drug information. Such repository shall be made publicly accessible on the Internet website of the National Library of Medicine and through a link on the homepage of the Internet website of the Food and Drug Administration.

(b) Posting Upon Approval- The Secretary shall post in the repository under subsection (a) the approved professional labeling and any required patient labeling of a drug approved under such section 505 or licensed under such section 351 not later than 21 days after the date the drug is approved, including in a supplemental application with respect to a labeling change.

(c) Report- The Secretary shall report annually to the Committee on Health, Education, Labor and Pensions of the Senate and the Committee on Energy and Commerce of the House of Representatives on the status of the repository under subsection (a), and on progress in posting structured electronic product information, including posting of information regarding drugs approved prior to the effective date of this title.

(d) Medication Guides- Not later than the effective date of this title, the Secretary, through the Commissioner of Food and Drugs, shall establish on the Internet website for the repository under subsection (a), a link to a list of each drug, whether approved under such section 505 or licensed under such section 351, for which a Medication Guide, as provided for under part 208 of title 21, Code of Federal Regulations (or any successor regulations), is required.

SEC. 109. FACTORY INSPECTIONS.

Paragraph (1) of section 704(a) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 374(a)) is amended by inserting `or marketing data’ after `No inspection authorized by the preceding sentence or by paragraph (3) shall extend to financial data, sales data other than shipment data’.

SEC. 110. STUDY ON INTEGRATION OF EXPERTISE OF OFFICE OF SURVEILLANCE AND EPIDEMIOLOGY.

Not later than 1 year after the date of the enactment of this Act, the Commissioner of Food and Drugs shall submit a report to the Congress on the Commissioner’s efforts to integrate the expertise of the Office of Surveillance and Epidemiology into the Food and Drug Administration’s approval, labeling, and post-approval safety decisions.

SEC. 111. BENEFIT-RISK ASSESSMENTS.

Not later than 1 year after the date of the enactment of this Act, the Commissioner of Food and Drugs shall submit to the Congress a report on how best to communicate to the public the risks and benefits of new drugs and the role of the risk evaluation and mitigation strategy in assessing such risks and benefits.

SEC. 112. EFFECTIVE DATE AND APPLICABILITY.

(a) Effective Date- This title shall take effect 180 days after the date of enactment of this Act.

(b) Drugs Deemed To Have Risk Evaluation and Mitigation Strategies-

(1) IN GENERAL- A drug that was approved before the effective date of this title shall be deemed to have an approved risk evaluation and mitigation strategy under section 505(o) of the Federal Food, Drug, and Cosmetic Act (as added by this title) if there are in effect on the effective date of this title restrictions on distribution or use–

(A) required under section 314.520 or section 601.42 of title 21, Code of Federal Regulations; or

(B) otherwise agreed to by the applicant and the Secretary for such drug.

(2) RISK EVALUATION AND MITIGATION STRATEGY- The approved risk evaluation and mitigation strategy deemed in effect for a drug under paragraph (1) shall consist of the elements described in subparagraphs (A) and (B) of paragraph (3) of such section 505(o) and any other additional elements under paragraphs (4) and (5) in effect for such drug on the effective date of this title.

(3) NOTIFICATION- Not later than 30 days after the effective date of this title, the Secretary shall notify the applicant for each drug described in paragraph (1)–

(A) that such drug is deemed to have an approved risk evaluation and mitigation strategy pursuant to such paragraph; and

(B) of the date, which shall be no earlier than 6 months after the applicant is so notified, by which the applicant shall submit to the Secretary an assessment of such approved strategy under paragraph (6)(B) of such section 505(o).

(c) Other Drugs Approved Before the Effective Date- The Secretary, on a case-by-case basis, may require the applicant for a drug approved before the effective date of this title to which subsection (b) does not apply to submit a proposed risk evaluation and mitigation strategy in accordance with the timeframes provided for in subclause (III), (IV), or (V), as applicable, of paragraph (6)(B)(ii) of such section 505(o) if the Secretary determines (with respect to such drug or with respect to the group of drugs to which such drug belongs) that–

(1) an element described under paragraph (3)(A) of such section 505(o) may require modification; or

(2) a standard for adding an element described in paragraph (4) or (5) of such section 505(o) that is not in effect with respect to such drug or class of drugs may apply.

(d) Use of Advisory Committees; Process for Addressing Drug Class Effects- In imposing a requirement under subsection (c), the Secretary–

(1) may convene a meeting of 1 or more advisory committees of the Food and Drug Administration in accordance with paragraph (6)(G) of such section 505(o); and

(2) may use the process described in paragraph (6)(H) of such section 505(o) (relating to addressing drug class effects).

SEC. 113. RULE OF CONSTRUCTION REGARDING PEDIATRIC STUDIES.

Nothing in this Act or the amendments made by this Act shall be construed to affect the authority of the Secretary or the Commissioner of Food and Drugs to require pediatric studies under section 505A of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355a).

SEC. 114. AUTHORIZATION OF APPROPRIATIONS.

(a) In General- For carrying out this title and the amendments made by this title, there is authorized to be appropriated $25,000,000 for each of fiscal years 2008 through 2012.

(b) Relation to Other Funding- The authorization of appropriations under subsection (a) is in addition to any other funds available for carrying out this title and the amendments made by this title.

TITLE II–REAGAN-UDALL INSTITUTE FOR APPLIED BIOMEDICAL RESEARCH

SEC. 201. THE REAGAN-UDALL INSTITUTE FOR APPLIED BIOMEDICAL RESEARCH.

(a) In General- Chapter VII of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 371 et seq.), as amended by Public Law 109-462, is amended by adding at the end the following:

`Subchapter I–Reagan-Udall Institute for Applied Biomedical Research

`SEC. 770. ESTABLISHMENT AND FUNCTIONS OF THE INSTITUTE.

`(a) In General- The Secretary shall establish a nonprofit corporation to be known as the Reagan-Udall Institute for Applied Biomedical Research (referred to in this subchapter as the `Institute’). The Institute shall be headed by an Executive Director, appointed by the members of the Board of Directors under subsection (e). The Institute shall not be an agency or instrumentality of the United States Government.

`(b) Purpose of Institute- The purpose of the Institute is to advance the Critical Path Initiative of the Food and Drug Administration to modernize medical product development, accelerate innovation, and enhance product safety.

`(c) Duties of the Institute- The Institute shall–

`(1) taking into consideration the 2004 report published by the Food and Drug Administration entitled `Innovation or Stagnation? Challenge and Opportunity on the Critical Path to New Medical Products’, identify unmet needs in the sciences of developing, manufacturing, and evaluating the safety and effectiveness of diagnostics, devices, biologics, and drugs, including–

`(A) the identification and validation of biomarkers for use in diagnostic, device, biologic, and drug development;

`(B) the development and validation of animal models for human disease and medical product safety;

`(C) pharmacogenomics and inter-individual variability in drug, biologic, and device response;

`(D) the development of data analysis technology and methodology for use in device, biologic, drug, and diagnostic development;

`(E) advancing improvements to the design and conduct of clinical trials;

`(F) toxicological quality assessment technologies;

`(G) diagnostic, device, biologic, and drug manufacturing, design, and materials science;

`(H) failure mode assessment for medical product development;

`(I) improving adverse event reporting and analysis;

`(J) bridging engineering data and clinical performance for devices; and

`(K) computer modeling;

`(2) establish goals and priorities in order to meet the unmet needs identified in paragraph (1);

`(3) in consultation with the Secretary, assess existing and proposed Federal intramural and extramural research and development programs relating to the goals and priorities established under paragraph (2) and facilitate and encourage interagency coordination of such programs;

`(4) award grants to, or enter into contracts or cooperative agreements with, scientists and entities to advance the goals and priorities established under paragraph (2);

`(5) recruit meeting participants and hold or sponsor (in whole or in part) meetings as appropriate to further the goals and priorities established under paragraph (2);

`(6) release and publish information and data and, to the extent practicable, license, distribute, and release material, reagents, and techniques to maximize, promote, and coordinate the availability of such material, reagents, and techniques for use by the Food and Drug Administration, nonprofit organizations, and academic and industrial researchers to further the goals and priorities established under paragraph (2);

`(7) ensure that–

`(A) action is taken as necessary to obtain patents for inventions developed by the Institute or with funds from the Institute;

`(B) action is taken as necessary to enable the licensing of inventions developed by the Institute or with funds from the Institute; and

`(C) executed licenses, memoranda of understanding, material transfer agreements, contracts, and other such instruments promote, to the maximum extent practicable, the broadest conversion to commercial and noncommercial applications of licensed and patented inventions of the Institute to further the goals and priorities established under paragraph (2);

`(8) provide objective clinical and scientific information to the Food and Drug Administration and, upon request, to other Federal agencies to assist in agency determinations of how to ensure that regulatory policy accommodates scientific advances;

`(9) conduct annual assessments of the unmet needs identified in paragraph (1); and

`(10) carry out such other activities consistent with the purposes of the Institute as the Board determines appropriate.

`(d) Board of Directors-

`(1) ESTABLISHMENT-

`(A) IN GENERAL- The Institute shall have a Board of Directors (referred to in this subchapter as the `Board’), which shall be composed of ex officio and appointed members in accordance with this subsection. All appointed members of the Board shall be voting members.

`(B) EX OFFICIO MEMBERS- The ex officio members of the Board shall be–

`(i) the immediate past Chair of the Board of Directors of the Institute;

`(ii) the Commissioner of Food and Drugs;

`(iii) the Director of the National Institutes of Health;

`(iv) the Director of the Centers for Disease Control and Prevention; and

`(v) the Director of the Agency for Healthcare Research and Quality.

`(C) APPOINTED MEMBERS-

`(i) IN GENERAL- The ex officio members of the Board under subparagraph (B) shall, by majority vote, appoint to the Board 12 individuals. Of such appointed members–

`(I) 3 shall be representatives of the general pharmaceutical, device, and biotechnology industries;

`(II) 3 shall be representatives of academic research organizations;

`(III) 2 shall be representatives of Government agencies, including the Food and Drug Administration and the National Institutes of Health;

`(IV) 3 shall be representatives of patient advocacy and consumer organizations; and

`(V) 1 shall be a representative of health care providers.

`(ii) REQUIREMENT- The ex officio members shall ensure the Board membership includes individuals with expertise in areas including clinical pharmacology, biomedical informatics, product safety, process improvement and pharmaceutical sciences, and medical device and biomedical engineering.

`(D) INITIAL MEETING-

`(i) IN GENERAL- Not later than 30 days after the date of the enactment of the Enhancing Drug Safety and Innovation Act of 2007, the Secretary shall convene a meeting of the ex officio members of the Board to–

`(I) incorporate the Institute; and

`(II) appoint the members of the Board in accordance with subparagraph (C).

`(ii) SERVICE OF EX OFFICIO MEMBERS- Upon the appointment of the members of the Board under clause (i)(II), the terms of service of the ex officio members of the Board as members of the Board shall terminate.

`(iii) CHAIR- The ex officio members of the Board under subparagraph (B) shall designate an appointed member of the Board to serve as the Chair of the Board.

`(2) DUTIES OF BOARD- The Board shall–

`(A) establish bylaws for the Institute that–

`(i) are published in the Federal Register and available for public comment;

`(ii) establish policies for the selection of the officers, employees, agents, and contractors of the Institute;

`(iii) establish policies, including ethical standards, for the acceptance, solicitation, and disposition of donations and grants to the Institution and for the disposition of the assets of the Institute;

`(iv) establish policies whereby any individual who is an officer, employee, or member of the Board of the Institute may not personally or substantially participate in the consideration or determination by the Institute of any matter that would directly or predictably affect any financial interest of the individual or a relative (as such term is defined in section 109(16) of the Ethics in Government Act of 1978) of the individual, of any business organization or other entity, or of which the individual is an officer or employee or is negotiating for employment, or in which the individual has any other financial interest;

`(v) establish licensing, distribution, and publication policies that support the widest and least restrictive use by the public of information and inventions developed by the Institute or with Institute funds to carry out the duties described in paragraphs (6) and (7) of subsection (c);

`(vi) specify principles for the review of proposals and awarding of grants and contracts that include peer review and that are substantially consistent with those of the Foundation for the National Institutes of Health;

`(vii) specify a process for annual Board review of the operations of the Institute; and

`(viii) establish specific duties of the Executive Director;

`(B) prioritize and provide overall direction to the activities of the Institute;

`(C) evaluate the performance of the Executive Director; and

`(D) carry out any other necessary activities regarding the functioning of the Institute.

`(3) ADDITIONAL BOARD FUNCTIONS- The Board may coordinate and collaborate with other entities to conduct research, education, and outreach, and to modernize the sciences of developing, manufacturing, and evaluating the safety and effectiveness of diagnostics, devices, biologics, and drugs.

`(4) TERMS AND VACANCIES-

`(A) TERM- The term of office of each member of the Board appointed under paragraph (1)(C) shall be 4 years, except that the terms of offices for the initial appointed members of the Board shall expire on a staggered basis as determined by the ex officio members.

`(B) VACANCY- Any vacancy in the membership of the Board–

`(i) shall not affect the power of the remaining members to execute the duties of the Board; and

`(ii) shall be filled by appointment by the individuals described in clauses (i) through (v) of paragraph (1)(B) by majority vote.

`(C) PARTIAL TERM- If a member of the Board does not serve the full term applicable under subparagraph (A), the individual appointed under subparagraph (B) to fill the resulting vacancy shall be appointed for the remainder of the term of the predecessor of the individual.

`(D) SERVING PAST TERM- A member of the Board may continue to serve after the expiration of the term of the member until a successor is appointed.

`(5) COMPENSATION- Members of the Board may not receive compensation for service on the Board. Such members may be reimbursed for travel, subsistence, and other necessary expenses incurred in carrying out the duties of the Board, as set forth in the bylaws issued by the Board.

`(e) Incorporation- The ex officio members of the Board shall serve as incorporators and shall take whatever actions necessary to incorporate the Institute.

`(f) Nonprofit Status- The Institute shall be considered to be a corporation under section 501(c) of the Internal Revenue Code of 1986, and shall be subject to the provisions of such section.

`(g) Executive Director-

`(1) IN GENERAL- The Board shall appoint an Executive Director who shall serve at the pleasure of the Board. The Executive Director shall be responsible for the day-to-day operations of the Institute and shall have such specific duties and responsibilities as the Board shall prescribe.

`(2) COMPENSATION- The compensation of the Executive Director shall be fixed by the Board but shall not be greater than the compensation of the Commissioner of Food and Drugs.

`(h) Administrative Powers- In carrying out this subchapter, the Board, acting through the Executive Director, may–

`(1) adopt, alter, and use a corporate seal, which shall be judicially noticed;

`(2) hire, promote, compensate, and discharge 1 or more officers, employees, and agents, as may be necessary, and define their duties;

`(3) prescribe the manner in which–

`(A) real or personal property of the Institute is acquired, held, and transferred;

`(B) general operations of the Institute are to be conducted; and

`(C) the privileges granted to the Board by law are exercised and enjoyed;

`(4) with the consent of the applicable executive department or independent agency, use the information, services, and facilities of such department or agencies in carrying out this section;

`(5) enter into contracts with public and private organizations for the writing, editing, printing, and publishing of books and other material;

`(6) hold, administer, invest, and spend any gift, devise, or bequest of real or personal property made to the Institute under subsection (i);

`(7) enter into such other contracts, leases, cooperative agreements, and other transactions as the Board considers appropriate to conduct the activities of the Institute;

`(8) modify or consent to the modification of any contract or agreement to which it is a party or in which it has an interest under this subchapter;

`(9) take such action as may be necessary to obtain patents and licenses for devices and procedures developed by the Institute and its employees;

`(10) sue and be sued in its corporate name, and complain and defend in courts of competent jurisdiction;

`(11) appoint other groups of advisors as may be determined necessary to carry out the functions of the Institute; and

`(12) exercise other powers as set forth in this section, and such other incidental powers as are necessary to carry out its powers, duties, and functions in accordance with this subchapter.

`(i) Acceptance of Funds From Other Sources- The Executive Director may solicit and accept on behalf of the Institute, any funds, gifts, grants, devises, or bequests of real or personal property made to the Institute, including from private entities, for the purposes of carrying out the duties of the Institute.

`(j) Service of Federal Employees- Federal Government employees may serve on committees advisory to the Institute and otherwise cooperate with and assist the Institute in carrying out its functions, so long as such employees do not direct or control Institute activities.

`(k) Detail of Government Employees- Federal Government employees may be detailed from Federal agencies with or without reimbursement to those agencies to the Institute at any time, and such detail shall be without interruption or loss of civil service status or privilege. Each such employee shall abide by the statutory, regulatory, ethical, and procedural standards applicable to the employees of the agency from which such employee is detailed and those of the Institute.

`(l) Annual Reports-

`(1) REPORTS TO INSTITUTE- Any recipient of a grant, contract, or cooperative agreement from the Institute under this section shall submit to the Institute a report on an annual basis for the duration of such grant, contract, or cooperative agreement, that describes the activities carried out under such grant, contract, or cooperative agreement.

`(2) REPORT TO FDA- Beginning with fiscal year 2009, the Executive Director shall submit to the Commissioner an annual report that–

`(A) details the progress of the Institute in furtheri

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