< Back to H.R. 4850 (109th Congress, 2005–2006)

Text of the Pharmaceutical Products Price Equity Act

This bill was introduced on March 2, 2006, in a previous session of Congress, but was not enacted. The text of the bill below is as of Mar 2, 2006 (Introduced).

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Source: GPO

I

109th CONGRESS

2d Session

H. R. 4850

IN THE HOUSE OF REPRESENTATIVES

March 2, 2006

introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on the Judiciary, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To provide for prices of pharmaceutical products that are fair to the producer and the consumer, and for other purposes.

1.

Short title

This Act may be cited as the Pharmaceutical Products Price Equity Act.

2.

Findings

The Congress finds the following:

(1)

Modern life enhancing and life sustaining drugs are the products of decades of scientific research and practice.

(2)

The refining and production of products by American pharmaceutical enterprises must be appropriately compensated.

(3)

The pricing of American pharmaceutical products varies greatly from country to country with the corporate owners of such products voluntarily assuming no losses by always selling their products above the cost of production.

(4)

Considering the vital life and death nature of pharmaceutical products, it is appropriate that the United States Government, in harmony with other nations belonging to the World Trade Organization, should engage in the reasonable regulation of the prices of pharmaceutical products.

3.

Reasonable limits on profits of pharmaceutical products

(a)

Presidential authority

The President shall issue such orders and regulations, and establish such procedures and reporting requirements, as the President determines to be appropriate to ensure that no pharmaceutical product (as defined by the President in such regulation or order) is sold to any consumer in the United States at a price that is more than 6 percent above the average retail price at which such pharmaceutical product is sold in the 5 most industrialized, free-market countries, other than the United States, as determined by the President.

(b)

Delegation

The President may delegate the performance of any function under this section to any officer of any Federal department or agency who has been appointed by the President, by and with the consent of the Senate.

(c)

Confidentiality of information

All information reported to or otherwise obtained by any person exercising any authority under this section which contains or relates to a trade secret or other matter referred to in section 1905 of title 18, United States Code, shall be considered confidential for purposes of that section, except that such information may be disclosed to any other officer or employee of the United States involved in carrying out this section solely for the purpose of carrying out, and enforcing compliance with, this section.

(d)

Subpoena power and production of documents

(1)

In general

The officer of any agency or department to whom the President has delegated any authority under this section, may—

(A)

examine any books, papers, records, or other data of any person which is relevant to the enforcement of this section or to any recordkeeping or reporting requirement prescribed for the purpose of carrying out this section; and

(B)

summon any person, an officer or employee of any person (including a former officer or employee), or any person having possession, custody, or care of the reports and records required to be made or maintained pursuant to this section, to appear at a time and place named in the summons and to produce such books, papers, records, or other data, and to give testimony, under oath, as may be relevant or material to an investigation or procedure under this section.

(2)

Administrative aspects of summons

(A)

Production at designated site

A summons issued pursuant to this section may require that books, papers, records, or other data stored or maintained at any place be produced at any designated location in any State or in any territory or other place subject to the jurisdiction of the United States not more than 500 miles distant from any place where the person summoned operates or conducts business in the United States.

(B)

Fees and travel expenses

Persons summoned under this section shall be paid the same fees and mileage for travel in the United States that are paid witnesses in the courts of the United States.

(C)

No liability for expenses

The United States shall not be liable for any expense, other than an expense described in subparagraph (B), incurred in connection with the production of books, papers, records, or other data under this section.

(3)

Service of summons

Service of a summons issued under this section may be by registered mail or in such other manner calculated to give actual notice as the officer delegated by the President may prescribe by regulation.

(4)

Contumacy or refusal

(A)

Referral to Attorney General

In case of contumacy by a person issued a summons under this subsection or a refusal by such person to obey such summons, the officer issuing the summons shall refer the matter to the Attorney General.

(B)

Jurisdiction of court

The Attorney General may invoke the aid of any court of the United States within the jurisdiction of which—

(i)

the investigation which gave rise to the summons is being or has been carried on;

(ii)

the person summoned is an inhabitant; or

(iii)

the person summoned carries on business or may be found,

to compel compliance with the summons.
(C)

Court order

The court may issue an order requiring the person summoned to appear before the Secretary or his delegate to produce books, papers, records, and other data, to give testimony as may be necessary to explain how such material was compiled and maintained, and to pay the costs of the proceeding.

(D)

Failure to comply with order

Any failure to obey the order of the court may be punished by the court as a contempt thereof.

(E)

Service of process

All process in any case under this subsection may be served in any judicial district in which such person may be found.

4.

Enforcement

(a)

Injunctions and other relief

(1)

In general

Whenever it appears to the officer authorized by the President to exercise authority under this Act, that any person has engaged, is engaged, or is about to engage in any act or practice that constitutes a violation of any regulation or order prescribed or issued pursuant to section 3, the officer may request the Attorney General to bring an action in an appropriate district court of the United States to enjoin such act or practice.

(2)

Remedies

Upon a proper showing in any action under paragraph (1), the court—

(A)

shall issue a temporary restraining order or grant a preliminary or permanent injunction without bond;

(B)

may also issue a mandatory injunction commanding any person to comply with any order or injunction issued or granted under subparagraph (A); and

(C)

may order restitution of moneys received in violation of any regulation prescribed or order issued under section 3 or any order issued or injunction granted under this section.

(b)

Penalties

(1)

Criminal

Whoever knowingly violates any regulation prescribed or order issued under section 3 shall be fined not more than the amount equal to 200 percent of the amount of the sale related to each violation.

(2)

Civil

(A)

In general

Whoever violates any regulation prescribed or order issued under section 3 shall be liable to the United States for a civil penalty of not more than 200 percent of the amount by which such person was unjustly enriched in connection with such violation.

(B)

Continuing violations

A separate violation occurs for each sale of a pharmaceutical product in violation of a regulation prescribed or order issued under section 3.

(C)

Assessment

(i)

Written notice

Any penalty imposed under subparagraph (A) may be assessed and collected by the officer authorized by the President to exercise authority under this Act by written notice.

(ii)

Finality of assessment

If, with respect to any assessment under clause (i), a hearing is not requested pursuant to subparagraph (F) within the period of time allowed under such subparagraph, the assessment shall constitute a final and unappealable order.

(D)

Authority to modify or remit penalty

Any officer authorized by the President to exercise authority under this Act may compromise, modify, or remit any penalty which such officer may assess or had already assessed under subparagraph (A).

(E)

Mitigating factors

In determining the amount of any penalty imposed under subparagraph (A), the officer authorized by the President to exercise authority under this Act shall take into account the appropriateness of the penalty with respect to—

(i)

the size of financial resources and good faith of the person charged;

(ii)

the gravity of the violation;

(iii)

the history of previous violations; and

(iv)

such other matters as justice may require.

(F)

Hearing

The person against whom any penalty is assessed under this paragraph shall be afforded an agency hearing if such person submits a request for such hearing within 20 days after the issuance of the notice of assessment.

(G)

Collection

(i)

Referral

If any person fails to pay an assessment after any penalty assessed under this paragraph has become final, the officer who imposed the penalty shall recover the amount assessed by action in the appropriate United States district court.

(ii)

Appropriateness of penalty not reviewable

In any civil action under clause (i), the validity and appropriateness of the penalty shall not be subject to review.

(H)

Disbursement

All penalties collected under authority of this paragraph shall be deposited into the Treasury.

(I)

Regulations

Any officer authorized by the President to exercise authority under this Act shall prescribe regulations establishing such procedures as may be necessary to carry out this paragraph.

5.

Civil liability

(a)

Liability established

Any person who violates any regulation prescribed or order issued under this Act with respect to any other person shall be liable to such person in an amount equal to the sum of the amounts determined under each of the following paragraphs:

(1)

Actual damages

The greater of—

(A)

the amount of any actual damage sustained by such person as a result of such failure; or

(B)

any amount paid by the injured person to the violator.

(2)

Punitive damages

(A)

Individual actions

In the case of any action by an individual, such additional amount as the court may allow.

(B)

Class actions

In the case of a class action, the sum of—

(i)

the aggregate of the amount which the court may allow for each named plaintiff; and

(ii)

the aggregate of the amount which the court may allow for each other class member, without regard to any minimum individual recovery.

(3)

Attorneys’ fees

In the case of any successful action to enforce any liability under paragraph (1) or (2), the costs of the action, together with reasonable attorneys’ fees.

(b)

Factors to be considered in awarding punitive damages

In determining the amount of any liability of any person under section (a), the court shall consider, among other relevant factors—

(1)

the frequency and persistence of noncompliance by the violator;

(2)

the nature of the noncompliance;

(3)

the extent to which such noncompliance was intentional; and

(4)

in the case of any class action, the number of consumers adversely affected.

6.

Authorization of appropriations

There are authorized to be appropriated to the President for fiscal years 2007, 2008, and 2009, such sums as may be necessary to carry out this Act.