May 23, 1991 EXTENSIONS OF REMARKS 12593 EXTENSIONS OF REMARKS THE INTRODUCTION OF THE GE­ Fourth, the bill will require the mandatory Debarment may be terminated within 180 NERIC DRUG ENFORCEMENT ACT withdrawal of any generic drug approval illicitly days or at end of minimum period upon ap­ OF 1991 obtained and the permissive withdrawal of ap­ plication to Secretary if the Secretary finds: provals where the company has repeatedly (A) no basis for its continuation and there are reasonable assurances that actions will HON. JOHN D. DINGEil failed to live up to its commitments to FDA. not recur; and (B) sufficient audits dem­ OF MICHIGAN Fifth, it will establish a series of civil pen­ onstrate that pending applications are free IN THE HOUSE OF REPRESENTATIVES alties for action corrupting the approval proc­ of fraud or material false statements. Thursday, May 23, 1991 ess. [306( d)(3)] Finally, it provides standby investigational Debarment may be terminated at any time Mr. DINGELL. Mr. Speaker, I am proud to authority for the Health and Human Services if a company can prove that its conviction introduce with my distinguished colleagues, Inspector General concerning Food and Drug was based on conduct of an employee who the Honorable THOMAS J. BULEY, the ranking Administration matters, including drug diver­ was not a high managerial agent and who was acting without the knowledge of top of­ Republican member of the Subcommittee on sion and fraud on the agency. Oversight and Investigation, the Honorable ficials in the corporation. [306(d)(4)] Undoubtedly, some generic firms will op­ The Secretary shall make public a list of HENRY A. WAXMAN, the chairman of the Sub­ pose this legislation, particularly those which debarred individuals and companies. [306(e)] committee on Health and Environment, the are or will be the targets of Federal criminal Permits the Secretary to temporarily Honorable NORMAN F. LENT, the ranking Re­ investigations. However, we do expect support withhold a generic drug approval for up to 18 publican member of the Committee on Energy from a majority of the honest generic drug months if he determines that a firm or indi­ and Commerce and 37 other members of the firms that recognize the importance of cleans­ vidual that is under an active Federal crimi­ Committee on Energy and Commerce, the Ge­ ing the industry of those who would corrupt nal investigation, has engaged in (1) bribery or attempted bribery of an IIllS employee in neric Drug Enforcement Act of 1991. the generic drug approval process. This bill is designed to be remedial in na­ connection with a generic drug, or (2) a pat­ The rapidly rising cost of drugs is severely tern of false statements or representations ture. Its purpose is to protect the integrity of taxing the resources of individuals and govern­ relating to any generic drug and (3) a signifi­ the generic drug approval process, restore mental entities. The American consumer has a cant question has been raised regarding the consumer confidence in generic drugs and to right to safe, effective, and low-priced generic integrity of the approval process with re­ create a strong deterrent to future misconduct. drugs. Unscrupulous individuals and, in a few spect to such generic drug. This period of de­ As many of you know, the Subcommittee on cases, firms, should not be allowed to under­ nial can be extended for an additional 18 Oversight and Investigation discovered signifi­ mine the public confidence in the industry that months if the firm has been indicted. [306(f)] Creates suspension authority covering the cant corruption in the Food and Drug Adminis­ provides us with low-cost alternatives to pre­ tration's process for approving drugs under distribution of all generic drugs produced by scription medication. It is essential that we companies under active Federal criminal in­ abbreviated drug applications. As a result of enact legislation that would bar such individ­ vestigations for corrupting the approval subsequent probes by the U.S. attorney in uals and firms from further participation in this process after a determination that such com­ Baltimore, the FDA, and the subcommittee, important business. Therefore, I urge my col­ panies have committed such an offense or there have been 18 criminal guilty pleas and leagues to support the Generic Drug Enforce­ that they have repeatedly failed to live up to convictions, scores of products have been re­ ment Act of 1991. their commitments to the FDA if such ac­ called or withdrawn, and 5 of the top 1O ge­ tion influences the safety and efficacy of A section-by-section description of the bill such drugs. [406(g)(l)] neric drug firms have been implicated in cor­ follows: ruption, fraud, or false statements. This legis­ The Secretary can waive suspension on SECTION-BY-SECTION DESCRIPTION OF THE public health grounds. [306(g)(2)] lation is essential to restore the confidence of GENERIC DRUG LEGISLATION The suspension order can be withdrawn if the American people in generic drugs and to Section 1-The title is the "Generic Drug (1) the suspended drugs have been satisfac­ assure that the Food and Drug Administration Enforcement Act of 1991." torily audited to assure they meet FDA [FDA] has sufficient authority to act against Section 2-New Section 306 (Debarment) standards and the person presents evidence those individuals and companies who subvert gives the Secretary authority to refuse to of ownership, management, and operational the generic drug approval process. accept, review or approve generic drug appli­ reforms to satisfactorily remedy the pattern The provisions of the enforcement bill will, cations for companies under specified cir­ of practice of acts causing the suspension or among other things, establish new procedures cumstances. (2) the initial determination was in error. In­ Creates mandatory debarment for firms formation submitted to the Secretary shall designed to ensure the continued integrity of and/or individuals from involvement in the be made public. [306(h)] FDA's generic drug approval process. generic drug approval process for felony The Secretary may not take any action First, it will protect the future honesty of the criminal convictions in connection with the with respect to debarment, the period of de­ system by requiring or permitting the Sec­ development or approval of generic drugs. barment, the termination of debarment, sus­ retary of the Department of Health and Human [306(a)] pension or termination of suspension with­ Services [HHS] to debar from future generic Creates permissive debarment of firms and/ out providing a full Administration Proce­ drug approvals, for at least 1 year, those firms or individuals by the Secretary for (1) a dure Act hearing on disputed issues of mate­ and individuals convicted or materially impli­ criminal conviction in connection with an rial fact. The Secretary is provided addi­ activity relating to the development or ap­ tional authorities to conduct discovery dur­ cated in bribery, fraud, false statements, or proval of generic drugs, (2) a criminal con­ ing these hearings. [306(i)] other crimes which undermine FDA approval viction for bribery, fraud, or similar crimes, Any person that is subject to final decision process. (3) a criminal conviction related to obstruc­ under this section has a right of judicial re­ Second, it will permit the temporary denial tion of justice, (4) being a material partici­ view. [306(j)] of generic drug approvals for up to 18 months, pant in such crimes, or (5) knowing use of a Sets forth the definition of "conviction" with one possible 18-month extension, where debarred person. [306(b)] and applies this section to all acts or convic­ the Secretary determines bribery, fraud, or the Under mandatory debarment individuals tions which occurred within the 5 years be­ like has occurred. will be permanently debarred for federal fel­ fore the initiation of the actions proposed to ony convictions relating to the generic drug be taken under this section.· [306(k)] Third, it will grant the Secretary authority to review process, and the minimum period for Section 3-Amends Section 507(j) to add to suspend the distribution of drugs of certain debarment for convicted companies is 1 year. generic drug applications the requirement companies, unless those companies can The maximum period is 10 years. Under per­ that the applicant certify it did not and will prove that some or all of their drugs are un­ missive debarment the maximum period is 5 not use the services of a debarred person in tainted. years. [306(c)] connection with the application. • This "bullet" symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor. 12594 EXTENSIONS OF REMARKS May 23, 1991 Section 4-New section 307 (Civil Money The record of our subcOmmittee's generic the emerging generic drug industry would be Penalties). Creates civil money penalties of drug hearings spans well over 1,000 pages of so tempted by the economic advantage up to $250,000 for individuals and $1,000,000 for sworn testimony. In it, we have documented gained by the first firm to obtain approval of a companies committing certain offenses in connection with generic drugs. payment of illegal gratuities and other forms of generic version of a given brand name drug Provides for a list of offenses in connection corruption involving personnel 'in the FDA's Di­ that they would engage in illegal and improper with generic drugs that trigger penalties: (1) vision of Generic Drugs and major segments activity to obtain such approvals. false statements; (2) bribery or gratuity; (3) of the generic drug industry who acted illegally Our consumers deserve the benefit of hon­ destruction of records; (4) failure to make to influence the review of pending generic est drug price competition, but in a regulatory obligated disclosure of a material fact; (5) drug applications.