AUTHORITY TO ASSESS AND USE DRUG FEES.

SEC. 103. AUTHORITY TO ASSESS AND USE DRUG FEES. (a) Types of Fees.—Section 736(a) (21 U.S.C. 379h(a)) is amended— (1) by striking “Beginning in fiscal year 1993” and inserting “Beginning in fiscal year 1998”; (2) in paragraph (1)— (A) by striking subparagraph (B) and inserting the following: “(B) Payment.—The fee required by subparagraph (A) shall be due upon submission of the application or supplement.”; (B) in subparagraph (D)— 111 STAT. 2300 (i) in the subparagraph heading, by striking “not accepted” and inserting “refused”; (ii) by striking “50 percent” and inserting “75 percent”; (iii) by striking “subparagraph (B)(i)” and inserting “subparagraph (B)”; and (iv) by striking “not accepted” and inserting “refused”; and (C) by adding at the end the following: “(E) Exception for designated orphan drug or indication.—A human drug application for a prescription drug product that has been designated as a drug for a rare disease or condition pursuant to section 526 shall not be subject to a fee under subparagraph (A), unless the human drug application includes an indication for other than a rare disease or condition. A supplement proposing to include a new indication for a rare disease or condition in a human drug application shall not be subject to a fee under subparagraph (A), if the drug has been designated pursuant to section 526 as a drug for a rare disease or condition with regard to the indication proposed in such supplement. “(F) Exception for supplements for pediatric indications.—A supplement to a human drug application proposing to include a new indication for use in pediatric populations shall not be assessed a fee under subparagraph (A). “(G) Refund of fee if application withdrawn.—If an application or supplement is withdrawn after the application or supplement was filed, the Secretary may refund the fee or a portion of the fee if no substantial work was performed on the application or supplement after the application or supplement was filed. The Secretary shall nave the sole discretion to refund a fee or a portion of the fee under this subparagraph. A determination by the Secretary concerning a refund under this paragraph shall not be reviewable.”; (3) by striking paragraph (2) and inserting the following: “(2) Prescription drug establishment fee.— “(A) In general.—Except as provided in subparagraph (B), each person that— “(i) is named as the applicant in a human drug application; and “(ii) after September 1, 1992, had pending before the Secretary a human drug application or supplement, shall be assessed an annual fee established in subsection (b) for each prescription drug establishment listed in its approved human drug application as an establishment that manufactures the prescription drug product named in the application. The annual establishment fee shall be assessed in each fiscal year in which the prescription drug product named in the application is assessed a fee under paragraph (3) unless the prescription drug establishment listed in the application does not engage in the manufacture of the prescription drug product during the fiscal year. The establishment fee shall be payable on or before January 31 of each year. Each such establishment shall be assessed 111 STAT. 2301only one fee per establishment, notwithstanding the number of prescription drug products manufactured at the establishment. In the event an establishment is listed in a human drug application by more than one applicant, the establishment fee for the fiscal year shall be divided equally and assessed among the applicants whose prescription drug products are manufactured by the establishment during the fiscal year and assessed product fees under paragraph (3). “(B) Exception.—If, during the fiscal year, an applicant initiates or causes to be initiated the manufacture of a prescription drug product at an establishment listed in its human drug application— “(i) that did not manufacture the product in the previous fiscal year; and “(ii) for which the full establishment fee has been assessed in the fiscal year at a time before manufacture of the prescription drug product was begun; the applicant will not be assessed a share of the establishment fee for the fiscal year in which the manufacture of the product began.”; and (4) in paragraph (3)— (A) in subparagraph (A)— (i) in clause (i), by striking “is fisted” and inserting “has been submitted for listing”; and (ii) by striking “Such fee shall be payable” and all that follows through “section 510.” and inserting the following: “Such fee shall be payable for the fiscal year in which the product is first submitted for listing under section 510, or is submitted for relisting under section 510 if the product has been withdrawn from listing and relisted. After such fee is paid for that fiscal year, such fee shall be payable on or before January 31 of each year. Such fee shall be paid only once for each product for a fiscal year in which the fee is payable.”; and (B) in subparagraph (B), by striking “505(j).” and inserting the following: “505(j), under an abbreviated application filed under section 507 (as in effect on the day before the date of enactment of the Food and Drug Administration Modernization Act of 1997), or under an abbreviated new drug application pursuant to regulations in effect prior to the implementation of the Drug Price Competition and Patent Term Restoration Act of 1984.”. (b) Fee Amounts.—Section 736(b) (21 U.S.C. 379h(b)) is amended to read as follows: “(b) Fee Amounts.—Except as provided in subsections (c), (d), (f), and (g), the fees required under subsection (a) shall be determined and assessed as follows: “(1) Application and supplement fees.— “(A) Full fees.—The application fee under subsection (a)(1)(A)(i) shall be $250,704 in fiscal year 1998, $256,338 in each of fiscal years 1999 and 2000, $267,606 in fiscal year 2001, and $258,451 in fiscal year 2002. “(B) Other fees.—The fee under subsection (a)(1)(A)(ii) shall be $125,352 in fiscal year 1998, $128,169 111 STAT. 2302in each of fiscal years 1999 and 2000, $133,803 in fiscal year 2001, and $129,226 in fiscal year 2002. “(2) Total fee revenues for establishment fees.—The total fee revenues to be collected in establishment fees under subsection (a)(2) shall be $35,600,000 in fiscal year 1998, $36,400,000 in each of fiscal years 1999 and 2000, $38,000,000 in fiscal year 2001, and $36,700,000 in fiscal year 2002. “(3) Total fee revenues for product fees.—The total fee revenues to be collected in product fees under subsection (a)(3) in a fiscal year shall be equal to the total fee revenues collected in establishment fees under subsection (a)(2) in that fiscal year.”. (c) Increases and Adjustments.—Section 736(c) (21 U.S.C. 379h(c)) is amended— (1) in the subsection heading, by striking “Increases and”; (2) in paragraph (1)— (A) by striking “(1) Revenue” and all that follows through “increased by the Secretary” and inserting the following: “(1) Inflation adjustment.—The fees and total fee revenues established in subsection (b) shall be adjusted by the Secretary”; (B) in subparagraph (A), by striking “increase” and inserting “change”; (C) in subparagraph (B), by striking “increase” and inserting “change”; and (D) by adding at the end the following flush sentence: “The adjustment made each fiscal year by this subsection will be added on a compounded basis to the sum of all adjustments made each fiscal year after fiscal year 1997 under this subsection.”; (3) in paragraph (2), by striking “October 1, 1992,” and all that follows through “such schedule.” and inserting the following: “September 30, 1997, adjust the establishment and product fees described in subsection (b) for the fiscal year in which the adjustment occurs so that the revenues collected from each of the categories of fees described in paragraphs (2) and (3) of subsection (b) shall be set to be equal to the revenues collected from the category of application and supplement fees described in paragraph (1) of subsection (b).”; and (4) in paragraph (3), by striking “paragraph (2)” and inserting “this subsection”. (d) Fee Waiver or Reduction.—Section 736(d) (21 U.S.C. 379h(d)) is amended— (1) by redesignating paragraphs (1), (2), (3), and (4) as subparagraphs (A), (B), (C), and (D), respectively and indenting appropriately; (2) by striking “The Secretary shall grant a” and all that follows through “finds that—” and inserting the following: “(1) In general.—The Secretary shall grant a waiver from or a reduction of one or more fees assessed under subsection (a) where the Secretary finds that—”; (3) in subparagraph (C) (as so redesignated in paragraph (1)), by striking “, or” and inserting a comma; (4) in subparagraph (D) (as so redesignated in paragraph (1)), by striking the period and inserting “, or”; (5) by inserting after subparagraph (D) (as so redesignated in paragraph (1)) the following: 111 STAT. 2303 “(E) the applicant involved is a small business submitting its first human drug application to the Secretary for review.”; and (6) by striking “In making the finding in paragraph (3),” and all that follows through “standard costs.” and inserting the following: “(2) Use of standard costs.—In making the finding in paragraph (1)(C), the Secretary may use standard costs. “(3) Rules relating to small businesses.— “(A) Definition.—In paragraph (1)(E), the term ‘small business’ means an entity that has fewer than 500 employees, including employees of affiliates. “(B) Waiver of application fee.—The Secretary shall waive under paragraph (1)(E) the application fee for the first human drug application that a small business or its affiliate submits to the Secretary for review. After a small business or its affiliate is granted such a waiver, the small business or its affiliate shall pay— “(i) application fees for all subsequent human drug applications submitted to the Secretary for review in the same manner as an entity that does not qualify as a small business; and “(ii) all supplement fees for all supplements to human drug applications submitted to the Secretary for review in the same manner as an entity that does not qualify as a small business.”. (e) Assessment of Fees.—Section 736(f)(1) (21 U.S.C. 379h(f)(1)) is amended— (1) by striking “fiscal year 1993” and inserting “fiscal year 1997”; and (2) by striking “fiscal year 1992” and inserting “fiscal year 1997 (excluding the amount of fees appropriated for such fiscal year)”. (f) Crediting and Availability of Fees.—Section 736(g) (21 U.S.C. 379h(g)) is amended— (1) in paragraph (1), by adding at the end the following: “Such sums as may be necessary may be transferred from the Food and Drug Administration salaries and expenses appropriation account without fiscal year limitation to such appropriation account for salaries and expenses with such fiscal year limitation. The sums transferred shall be available solely for the process for the review of human drug applications.”; (2) in paragraph (2)— (A) in subparagraph (A), by striking “Acts” and inserting “Acts, or otherwise made available for obligation,”; and (B) in subparagraph (B), by striking “over such costs for fiscal year 1992” and inserting “over such costs, excluding costs paid from fees collected under this section, for fiscal year 1997”; and (3) by striking paragraph (3) and inserting the following: “(3) Authorization of appropriations.—There are authorized to be appropriated for fees under this section— “(A) $106,800,000 for fiscal year 1998; “(B) $109,200,000 for fiscal year 1999; “(C) $109,200,000 for fiscal year 2000; “(D) $114,000,000 for fiscal year 2001; and “(E) $110,100,000 for fiscal year 2002, 111 STAT. 2304 as adjusted to reflect adjustments in the total fee revenues made under this section and changes in the total amounts collected by application, supplement, establishment, and product fees. “(4) Offset.—Any amount of fees collected for a fiscal year under this section that exceeds the amount of fees specified in appropriation Acts for such fiscal year shall be credited to the appropriation account of the Food and Drug Administration as provided in paragraph (1), and shall be subtracted from the amount of tees that would otherwise be authorized to be collected under this section pursuant to appropriation Acts for a subsequent fiscal year.”. (g) Requirement for Written Requests for Waivers, Reductions, and Refunds.—Section 736 (21 U.S.C. 379h) is amended— (1) by redesignating subsection (i) as subsection (j); and (2) by inserting after subsection (h) the following: “(i) Written Requests for Waivers, Reductions, and Refunds.—To qualify for consideration for a waiver or reduction under subsection (d), or for a refund of any fee collected in accordance with subsection (a), a person shall submit to the Secretary a written request for such waiver, reduction, or refund not later than 180 days after such fee is due.”. (h) Special Rule for Waivers and Refunds.—Any requests for waivers or refunds for fees assessed under section 736 of the Federal Food, Drug, and Cosmetic Act (42 U.S.C. 379h) prior to the date of enactment of this Act shall be submitted in writing to the Secretary of Health and Human Services within 1 year after the date of enactment of this Act. Any requests for waivers or refunds pertaining to a fee for a human drug application or supplement accepted for filing prior to October 1, 1997 or to a product or establishment fee required by such Act for a fiscal year prior to fiscal year 1998, shall be evaluated according to the terms of the Prescription Drug User Fee Act of 1992 (as in effect on September 30, 1997) and part 2 of subchapter C of chapter VII of the Federal Food, Drug, and Cosmetic Act (as in effect on September 30, 1997). The term “person” in such Acts shall continue to include an affiliate thereof.