[House Report 108-147]
[From the U.S. Government Publishing Office]
108th Congress Rept. 108-147
HOUSE OF REPRESENTATIVES
1st Session Part 2
======================================================================
PROJECT BIOSHIELD ACT OF 2003
_______
June 12, 2003.--Ordered to be printed
_______
Mr. Tom Davis of Virginia, from the Committee on Government Reform,
submitted the following
R E P O R T
[To accompany H.R. 2122]
[Including cost estimate of the Congressional Budget Office]
The Committee on Government Reform, to whom was referred
the bill (H.R. 2122) to enhance research, development,
procurement, and use of biomedical countermeasures to respond
to public health threats affecting national security, and for
other purposes, having considered the same, report favorably
thereon with an amendment and recommend that the bill as
amended do pass.
CONTENTS
Page
Committee Statement and Views.................................... 15
Section-by-Section Analysis...................................... 18
Explanation of Amendments........................................ 22
Committee Consideration.......................................... 22
Application of Law to the Legislative Branch..................... 23
Statement of Oversight Findings and Recommendations of the
Committee...................................................... 23
Statement of General Performance Goals and Objectives............ 23
Constitutional Authority Statement............................... 23
Unfunded Mandate Statement....................................... 23
Committee Estimate............................................... 23
Budget Authority and Congressional Budget Office Cost Estimate... 24
Changes in Existing Law Made by the Bill as Reported............. 33
The amendment is as follows:
Strike all after the enacting clause and insert the following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Project BioShield Act of 2003''.
SEC. 2. BIOMEDICAL COUNTERMEASURE RESEARCH AND DEVELOPMENT AUTHORITIES.
(a) In General.--Part B of title III of the Public Health Service Act
(42 U.S.C. 243 et seq.) is amended by inserting after section 319F the
following section:
``SEC. 319F-1. AUTHORITY FOR USE OF CERTAIN PROCEDURES REGARDING
BIOMEDICAL COUNTERMEASURE RESEARCH AND DEVELOPMENT
ACTIVITIES.
``(a) In General.--
``(1) Authority.--In conducting and supporting research and
development activities regarding biomedical countermeasures
under section 319F(h), the Secretary may conduct and support
such activities in accordance with this section if the
activities concern qualified countermeasures.
``(2) Qualified countermeasure.--For purposes of this
section, the term `qualified countermeasure' means a priority
countermeasure (as defined in section 319F(h)) that affects
national security.
``(3) Interagency cooperation.--
``(A) In general.--In carrying out activities under
this section, the Secretary is authorized, subject to
subparagraph (B), to enter into interagency agreements
and other collaborative undertakings with other
agencies of the United States Government.
``(B) Limitation.--An agreement or undertaking under
this paragraph shall not authorize another agency to
exercise the authorities provided by this section.
``(4) Availability of facilities to the secretary.--In any
grant or cooperative agreement entered into under the authority
provided in this section with respect to a biocontainment
laboratory or other related or ancillary specialized research
facility that the Secretary determines necessary for the
purpose of performing, administering, and supporting qualified
countermeasure research and development, the Secretary may
provide that the facility that is the object of such grant or
cooperative agreement shall be available as needed to the
Secretary to respond to public health emergencies affecting
national security.
``(b) Expedited Procurement Authority.--
``(1) Increased simplified acquisition threshold for
biomedical countermeasure procurements.--
``(A) In general.--For any procurement by the
Secretary of property or services for use (as
determined by the Secretary) in performing,
administering, or supporting qualified countermeasure
research or development activities under this section
that the Secretary determines necessary to respond to
pressing research and development needs under this
section, the amount specified in section 4(11) of the
Office of Federal Procurement Policy Act (41 U.S.C.
403(11)), as applicable pursuant to section 302A(a) of
the Federal Property and Administrative Services Act of
1949 (41 U.S.C. 252a(a)), shall be deemed to be
$25,000,000 in the administration, with respect to such
procurement, of--
``(i) section 303(g)(1)(A) of the Federal
Property and Administrative Services Act of
1949 (41 U.S.C. 253(g)(1)(A)) and its
implementing regulations; and
``(ii) section 302A(b) of such Act (41 U.S.C.
252a(b)) and its implementing regulations.
``(B) Application of certain provisions.--
Notwithstanding subparagraph (A) and the provision of
law and regulations referred to in such subparagraph,
each of the following provisions shall apply to
procurements described in this paragraph to the same
extent that such provisions would apply to such
procurements in the absence of subparagraph (A):
``(i) Chapter 37 of title 40, United States
Code (relating to contract work hours and
safety standards).
``(ii) Subsections (a) and (b) of section 7
of the Anti-Kickback Act of 1986 (41 U.S.C.
57(a) and (b)).
``(iii) Section 304C of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 254d) (relating to the examination of
contractor records).
``(C) Internal controls to be instituted.--The
Secretary shall institute appropriate internal controls
for procurements that are under this paragraph,
including requirements with regard to documenting the
justification for use of the authority in this
paragraph.
``(2) Other than full and open competition.--(A) In using the
authority provided in section 303(c)(1) of title III of the
Federal Property and Administrative Services Act of 1949 (41
U.S.C. 253(c)(1)) to use procedures other than competitive
procedures in the case of a procurement described in paragraph
(1) of this subsection, the phrase `available from only one
responsible source' in such section 303(c)(1) shall be deemed
to mean `available from only one responsible source or only
from a limited number of responsible sources'.
``(B) The authority under subparagraph (A) is in addition to
any other authority to use procedures other than competitive
procedures.
``(C) The Secretary shall implement this paragraph in
accordance with applicable government-wide regulations,
including requirements that offers be solicited from as many
potential sources as is practicable under the circumstances,
that required notices be published, and that submitted offers
be considered.
``(3) Increased micropurchase threshold.--
``(A) In general.--For a procurement described by
paragraph (1), the amount specified in subsections (c),
(d), and (f) of section 32 of the Office of Federal
Procurement Policy Act (41 U.S.C. 428) shall be deemed
to be $15,000 in the administration of that section
with respect to such procurement.
``(B) Internal controls to be instituted.--The
Secretary shall institute appropriate internal controls
for purchases that are under this paragraph and that
are greater than $2,500.
``(C) Exception to preference for purchase card
mechanism.--No provision of law establishing a
preference for using a Government purchase card method
for purchases shall apply to purchases that are under
this paragraph and that are greater than $2,500.
``(c) Authority To Expedite Peer Review.--
``(1) In general.--The Secretary may, as the Secretary
determines necessary to respond to pressing qualified
countermeasure research and development needs under this
section, employ such expedited peer review procedures
(including consultation with appropriate scientific experts) as
the Secretary, in consultation with the Director of NIH, deems
appropriate to obtain assessment of scientific and technical
merit and likely contribution to the field of qualified
countermeasure research, in place of the peer review and
advisory council review procedures that would be required under
sections 301(a)(3), 405(b)(1)(B), 405(b)(2), 406(a)(3)(A), 492,
and 494, as applicable to a grant, contract, or cooperative
agreement--
``(A) that is for performing, administering, or
supporting qualified countermeasure research and
development activities; and
``(B) the amount of which is not greater than
$1,500,000.
``(2) Subsequent phases of research.--The Secretary's
determination of whether to employ expedited peer review with
respect to subsequent phases of a research grant or cooperative
agreement under this section shall be determined without regard
to the peer review procedures used for any prior peer review of
that same grant or cooperative agreement.
``(d) Authority for Personal Services Contracts.--
``(1) In general.--For the purpose of performing,
administering, and supporting qualified countermeasure research
and development activities, the Secretary may, as the Secretary
determines necessary to respond to pressing qualified
countermeasure research and development needs under this
section, obtain by contract (in accordance with section 3109 of
title 5, United States Code, but without regard to the
limitations in such section on the period of service and on
pay) the personal services of experts or consultants who have
scientific or other professional qualifications, except that in
no case shall the compensation provided to any such expert or
consultant exceed the daily equivalent of the annual rate of
compensation for the President.
``(2) Federal tort claims act coverage.--
``(A) In general.--A person carrying out a contract
under paragraph (1), and an officer, employee, or
governing board member of such person, shall be deemed
to be an employee of the Department of Health and Human
Services for purposes of claims under sections 1346(b)
and 2672 of title 28, United States Code, for money
damages for personal injury, including death, resulting
from performance of functions under such contract.
``(B) Exclusivity of remedy.--The remedy provided by
subparagraph (A) shall be exclusive of any other civil
action or proceeding by reason of the same subject
matter against the person, officer, employee, or
governing board member.
``(3) Internal controls to be instituted.--
``(A) In general.--The Secretary shall institute
appropriate internal controls for contracts under this
subsection, including procedures for the Secretary to
make a determination of whether a person, or an
officer, employee, or governing board member of a
person, is deemed to be an employee of the Department
of Health and Human Services pursuant to paragraph (2).
``(B) Determination of employee status to be final.--
A determination by the Secretary under subparagraph (A)
that a person, or an officer, employee, or governing
board member of a person, is or is not deemed to be an
employee of the Department of Health and Human Services
shall be final and binding on the Secretary and the
Attorney General and other parties to any civil action
or proceeding.
``(4) Number of personal services contracts limited.--The
number of experts and consultants whose personal services are
obtained under paragraph (1) shall not exceed 30 at any time.
``(e) Streamlined Personnel Authority.--
``(1) In general.--In addition to any other personnel
authorities, the Secretary may, as the Secretary determines
necessary to respond to pressing qualified countermeasure
research and development needs under this section, without
regard to such provisions of title 5, United States Code,
governing appointments in the competitive service, and without
regard to the provisions of chapter 51 and subchapter III of
chapter 53 of such title relating to classification and General
Schedule pay rates, appoint professional and technical
employees, not to exceed 30 such employees at any time, to
positions in the National Institutes of Health to perform,
administer, or support qualified countermeasure research and
development activities in carrying out this section.
``(2) Internal controls to be instituted.--The Secretary
shall institute appropriate internal controls for appointments
under this subsection.
``(f) Actions Committed to Agency Discretion.--Actions by the
Secretary under the authority of this section are committed to agency
discretion.
``(g) Effect on Right To File Protest.--Nothing in this section shall
affect the right of an interested party to file a protest with the
contracting agency, to file a protest with the Comptroller General
under subchapter V of chapter 35 of title 31, United States Code, or to
file an action in the United States Court of Federal Claims under
section 1491(b) of title 28, United States Code.''.
(b) Technical Amendment.--Section 481A of the Public Health Service
Act (42 U.S.C. 287a-2) is amended--
(1) in subsection (a)(1), by inserting ``or the Director of
the National Institute of Allergy and Infectious Diseases''
after ``Director of the Center'';
(2) in subsection (c)--
(A) in paragraph (1), by inserting ``or the Director
of the National Institute of Allergy and Infectious
Diseases'' after ``Director of the Center''; and
(B) in paragraph (2), in the matter preceding
subparagraph (A), by striking ``subsection (i)'' and
inserting ``subsection (i)(1)'';
(3) in subsection (d), by inserting ``or the Director of the
National Institute of Allergy and Infectious Diseases'' after
``Director of the Center'';
(4) in subsection (e)--
(A) in paragraph (1)--
(i) in the matter preceding subparagraph (A),
by inserting ``or the Director of the National
Institute of Allergy and Infectious Diseases''
after ``Director of the Center'';
(ii) in subparagraph (A), by inserting ``(or,
in the case of the Institute, 75 percent)''
after ``50 percent''; and
(iii) in subparagraph (B), by inserting
``(or, in the case of the Institute, 75
percent)'' after ``40 percent'';
(B) in paragraph (2), by inserting ``or the Director
of the National Institute of Allergy and Infectious
Diseases'' after ``Director of the Center''; and
(C) in paragraph (4), by inserting ``of the Center or
the Director of the National Institute of Allergy and
Infectious Diseases'' after ``Director'';
(5) in subsection (f)--
(A) in paragraph (1), by inserting ``in the case of
an award by the Director of the Center,'' before ``the
applicant''; and
(B) in paragraph (2), by inserting ``of the Center or
the Director of the National Institute of Allergy and
Infectious Diseases'' after ``Director''; and
(6) in subsection (i)--
(A) by striking ``Appropriations.--For the purpose of
carrying out this section,'' and inserting the
following: ``Appropriations.--
``(1) Center.--For the purpose of carrying out this section
with respect to the Center,''; and
(B) by adding at the end the following:
``(2) National institute of allergy and infectious
diseases.--For the purpose of carrying out this section with
respect to the National Institute of Allergy and Infectious
Diseases, there are authorized to be appropriated such sums as
may be necessary for fiscal year 2003.''.
SEC. 3. BIOMEDICAL COUNTERMEASURES PROCUREMENT.
(a) In General.--Part B of title III of the Public Health Service
Act, as amended by section 2 of this Act, is amended by inserting after
section 319F-1 the following section:
``SEC. 319F-2. STRATEGIC NATIONAL STOCKPILE.
``(a) Strategic National Stockpile.--
``(1) In general.--The Secretary of Homeland Security
(referred to in this section as the `Homeland Security
Secretary'), in coordination with the Secretary and the
Secretary of Veterans Affairs, shall maintain a stockpile or
stockpiles of drugs, vaccines and other biological products,
medical devices, and other supplies in such numbers, types, and
amounts as are determined by the Secretary to be appropriate
and practicable, taking into account other available sources,
to provide for the emergency health security of the United
States, including the emergency health security of children and
other vulnerable populations, in the event of a bioterrorist
attack or other public health emergency.
``(2) Procedures.--The Secretary, in managing the stockpile
under paragraph (1), shall--
``(A) consult with the working group under section
319F(a);
``(B) ensure that adequate procedures are followed
with respect to such stockpile for inventory management
and accounting, and for the physical security of the
stockpile;
``(C) in consultation with Federal, State, and local
officials, take into consideration the timing and
location of special events;
``(D) review and revise, as appropriate, the contents
of the stockpile on a regular basis to ensure that
emerging threats, advanced technologies, and new
countermeasures are adequately considered;
``(E) devise plans for the effective and timely
supply-chain management of the stockpile, in
consultation with appropriate Federal, State and local
agencies, and the public and private health care
infrastructure; and
``(F) ensure the adequate physical security of the
stockpile.
``(b) Smallpox Vaccine Development.--
``(1) In general.--The Secretary shall award contracts, enter
into cooperative agreements, or carry out such other activities
as may reasonably be required in order to ensure that the
stockpile under subsection (a) includes an amount of vaccine
against smallpox as determined by such Secretary to be
sufficient to meet the health security needs of the United
States.
``(2) Rule of construction.--Nothing in this section shall be
construed to limit the private distribution, purchase, or sale
of vaccines from sources other than the stockpile described in
subsection (a).
``(c) Additional Authority Regarding Procurement of Certain
Biomedical Countermeasures; Availability of Special Reserve Fund.--
``(1) In general.--
``(A) Use of fund.--A security countermeasure may, in
accordance with this subsection, be procured with
amounts in the special reserve fund under paragraph
(10).
``(B) Security countermeasure.--For purposes of this
subsection, the term `security countermeasure' means a
priority countermeasure (as defined in section
319F(h))--
``(i) that affects national security;
``(ii) that is determined under paragraph
(2)(B)(ii) to be a necessary countermeasure;
and
``(iii)(I) that is approved or cleared under
chapter V of the Federal Food, Drug, and
Cosmetic Act, or licensed under section 351 of
this Act, for use as a countermeasure to a
chemical, biological, radiological, or nuclear
agent identified as a material threat under
paragraph (2)(A)(ii); or
``(II) for which the Secretary determines
that sufficient and satisfactory clinical
experience or research data (including data, if
available, from pre-clinical and clinical
trials) support a reasonable conclusion that
the countermeasure will qualify for approval or
licensing after the date of a determination
under paragraph (5).
``(2) Determination of material threats.--
``(A) Material threat.--The Homeland Security
Secretary, in consultation with the heads of other
agencies as appropriate, shall on an ongoing basis--
``(i) assess current and emerging threats of
chemical, biological, radiological, and nuclear
agents; and
``(ii) determine which of such agents present
a material threat against the United States
population.
``(B) Public health impact; necessary
countermeasures.--The Secretary shall on an ongoing
basis--
``(i) assess the potential public health
consequences of use against the United States
population of agents identified under
subparagraph (A)(ii); and
``(ii) determine, on the basis of such
assessment, the agents for which priority
countermeasures are necessary to protect the
public health from a material threat.
``(3) Assessment of availability and appropriateness of
countermeasures.--The Secretary, in consultation with the
Homeland Security Secretary, shall assess on an ongoing basis
the availability and appropriateness of specific
countermeasures to address specific threats identified under
paragraph (2).
``(4) Call for security countermeasures; commitment for
recommendation for procurement.--
``(A) Proposal to the president.--If, pursuant to an
assessment under paragraph (3), the Homeland Security
Secretary and the Secretary make a determination that a
security countermeasure would be appropriate, such
Secretaries may jointly submit to the President a
proposal to--
``(i) issue a call for the development of
such security countermeasure; and
``(ii) make a commitment that, upon the first
development of such security countermeasure
that meets the conditions for procurement under
paragraph (5), the Secretaries will, based in
part on information obtained pursuant to such
call, make a recommendation under paragraph (6)
that the special reserve fund under paragraph
(10) be made available for the procurement of
such security countermeasure.
``(B) Countermeasure specifications.--The Homeland
Security Secretary and the Secretary shall, to the
extent practicable, include in the proposal under
subparagraph (A)--
``(i) estimated quantity of purchase (in the
form of number of doses or number of effective
courses of treatments regardless of dosage
form);
``(ii) necessary measures of minimum safety
and effectiveness;
``(iii) estimated price for each dose or
effective course of treatment regardless of
dosage form; and
``(iv) other information that may be
necessary to encourage and facilitate research,
development, and manufacture of the
countermeasure or to provide specifications for
the countermeasure.
``(C) Presidential approval.--If the President
approves a proposal under subparagraph (A), the
Homeland Security Secretary and the Secretary shall
make known to persons who may respond to a call for the
security countermeasure involved--
``(i) the call for the countermeasure;
``(ii) specifications for the countermeasure
under subparagraph (B); and
``(iii) a commitment described in
subparagraph (A)(ii).
``(5) Secretary's determination of countermeasures
appropriate for funding from special reserve fund.--
``(A) In general.--The Secretary, in accordance with
the provisions of this paragraph, shall identify
specific security countermeasures that the Secretary
determines, in consultation with the Homeland Security
Secretary, to be appropriate for inclusion in the
stockpile under subsection (a) pursuant to procurements
made with amounts in the special reserve fund under
paragraph (10) (referred to in this subsection
individually as a `procurement under this subsection').
``(B) Requirements.--In making a determination under
subparagraph (A) with respect to a security
countermeasure, the Secretary shall determine and
consider the following:
``(i) The quantities of the product that will
be needed to meet the needs of the stockpile.
``(ii) The feasibility of production and
delivery within five years of sufficient
quantities of the product.
``(iii) Whether there is a lack of a
significant commercial market for the product
at the time of procurement, other than as a
security countermeasure.
``(6) Recommendation for president's approval.--
``(A) Recommendation for procurement.--In the case of
a security countermeasure that the Secretary has, in
accordance with paragraphs (2), (3), and (5),
determined to be appropriate for procurement under this
subsection, the Homeland Security Secretary and the
Secretary shall jointly submit to the President, in
coordination with the Director of the Office of
Management and Budget, a recommendation that the
special reserve fund under paragraph (10) be made
available for the procurement of such countermeasure.
``(B) Presidential approval.--The special reserve
fund under paragraph (10) is available for a
procurement of a security countermeasure only if the
President has approved a recommendation under
subparagraph (A) regarding the countermeasure.
``(C) Notice to congress.--The Secretary and the
Homeland Security Secretary shall notify the Congress
of each decision of the President to approve a
recommendation under subparagraph (A). Such notice
shall include an explanation of the decision to make
available the special reserve fund under paragraph (10)
for procurement of such a countermeasure, including,
where available, the identification of the potential
supplier or suppliers of such countermeasure, and
whether other potential suppliers of the same or
similar countermeasures were considered and rejected
for procurement under this section and the reasons
therefor.
``(D) Subsequent specific countermeasures.--
Procurement under this subsection of a security
countermeasure for a particular purpose does not
preclude the subsequent procurement under this
subsection of any other security countermeasure for
such purpose if the Secretary has determined under
paragraph (5)(A) that such countermeasure is
appropriate for inclusion in the stockpile and if, as
determined by the Secretary, such countermeasure
provides improved safety or effectiveness, or for other
reasons enhances preparedness to respond to threats of
use of a biological, chemical, radiological, or nuclear
agent. Such a determination by the Secretary is
committed to agency discretion.
``(E) Rule of construction.--Recommendations and
approvals under this paragraph apply solely to
determinations that the special reserve fund under
paragraph (10) will be made available for a procurement
of a security countermeasure, and not to the substance
of contracts for such procurement or other matters
relating to awards of such contracts.
``(7) Procurement.--
``(A) In general.--For purposes of a procurement
under this subsection that is approved by the President
under paragraph (6), the Homeland Security Secretary
and the Secretary shall have responsibilities in
accordance with subparagraphs (B) and (C).
``(B) Interagency agreements.--
``(i) For procurement.--The Homeland Security
Secretary shall enter into an agreement with
the Secretary for procurement of a security
countermeasure in accordance with the
provisions of this paragraph. The special
reserve fund under paragraph (10) shall be
available for the Secretary's costs of such
procurement, other than as provided in clause
(ii).
``(ii) For administrative costs.--The
agreement entered into between the Homeland
Security Secretary and the Secretary for
managing the stockpile under subsection (a)
shall provide for reimbursement of the
Secretary's administrative costs relating to
procurements under this subsection.
``(C) Procurement.--
``(i) In general.--The Secretary shall be
responsible for--
``(I) arranging for procurement of a
security countermeasure, including
negotiating terms (including quantity,
production schedule, and price) of, and
entering into, contracts and
cooperative agreements, and for
carrying out such other activities as
may reasonably be required, in
accordance with the provisions of this
subparagraph; and
``(II) promulgating regulations to
implement clauses (v), (vi), and (vii),
and any other provisions of this
subsection.
``(ii) Contract terms.--A contract for
procurements under this subsection shall (or,
as specified below, may) include the following
terms:
``(I) Payment conditioned on
substantial delivery.--The contract
shall provide that no payment may be
made until delivery has been made of a
substantial portion (as determined by
the Secretary) of the total number of
units contracted for, except that,
notwithstanding any other provision of
law, the contract may provide that, if
the Secretary determines (in the
Secretary's discretion) that an advance
payment is necessary to ensure success
of a project, the Secretary may pay an
amount, not to exceed 10 percent of the
contract amount, in advance of
delivery. The contract shall provide
that such advance payment is required
to be repaid if there is a failure to
perform under the contract, except in
special circumstances as determined by
the Secretary on a contract by contract
basis.
``(II) Contract duration.--The
contract shall be for a period not to
exceed five years, except that, in
first awarding the contract, the
Secretary may provide for a longer
duration, not exceeding eight years, if
the Secretary determines that
complexities or other difficulties in
performance under the contract justify
such a period. The contract shall be
renewable for additional periods, none
of which shall exceed five years.
``(III) Storage by vendor.--The
contract may provide that the vendor
will provide storage for stocks of a
product delivered to the ownership of
the Federal Government under the
contract, for such period and under
such terms and conditions as the
Secretary may specify, and in such case
amounts from the special reserve fund
under paragraph (10) shall be available
for costs of shipping, handling,
storage, and related costs for such
product.
``(iii) Availability of simplified
acquisition procedures.--
``(I) In general.--If the Secretary
determines that there is a pressing
need for a procurement of a specific
countermeasure, the amount of the
procurement under this subsection shall
be deemed to be below the threshold
amount specified in section 4(11) of
the Office of Federal Procurement
Policy Act (41 U.S.C. 403(11)), for
purposes of application to such
procurement, pursuant to section
302A(a) of the Federal Property and
Administrative Services Act of 1949 (41
U.S.C. 252a(a)), of--
``(aa) section 303(g)(1)(A)
of the Federal Property and
Administrative Services Act of
1949 (41 U.S.C. 253(g)(1)(A))
and its implementing
regulations; and
``(bb) section 302A(b) of
such Act (41 U.S.C. 252a(b))
and its implementing
regulations.
``(II) Application of certain
provisions.--Notwithstanding subclause
(I) and the provision of law and
regulations referred to in such clause,
each of the following provisions shall
apply to procurements described in this
clause to the same extent that such
provisions would apply to such
procurements in the absence of
subclause (I):
``(aa) Chapter 37 of title
40, United States Code
(relating to contract work
hours and safety standards).
``(bb) Subsections (a) and
(b) of section 7 of the Anti-
Kickback Act of 1986 (41 U.S.C.
57(a) and (b)).
``(cc) Section 304C of the
Federal Property and
Administrative Services Act of
1949 (41 U.S.C. 254d) (relating
to the examination of
contractor records).
``(iv) Other than full and open
competition.--(I) In using the authority
provided in section 303(c)(1) of title III of
the Federal Property and Administrative
Services Act of 1949 (41 U.S.C. 253(c)(1)) to
use procedures other than competitive
procedures in the case of a procurement under
this subsection, the phrase `available from
only one responsible source' in such section
303(c)(1) shall be deemed to mean `available
from only one responsible source or only from a
limited number of responsible sources'.
``(II) The authority under subclause (I) is
in addition to any other authority to use
procedures other than competitive procedures.
``(III) The Secretary shall implement this
clause in accordance with applicable
government-wide regulations, including
requirements that offers be solicited from as
many potential sources as is practicable under
the circumstances, that required notices be
published, and that submitted offers be
considered.
``(v) Premium provision in multiple award
contracts.--
``(I) In general.--If, under this
subsection, the Secretary enters into
contracts with more than one vendor to
procure a security countermeasure, such
Secretary may, notwithstanding any
other provision of law, include in each
of such contracts a provision that--
``(aa) identifies an
increment of the total quantity
of security countermeasure
required, whether by percentage
or by numbers of units; and
``(bb) promises to pay one or
more specified premiums based
on the priority of such
vendors' production and
delivery of the increment
identified under item (aa), in
accordance with the terms and
conditions of the contract.
``(II) Determination of government's
requirement not reviewable.--If the
Secretary includes in each of a set of
contracts a provision as described in
subclause (I), such Secretary's
determination of the total quantity of
security countermeasure required, and
any amendment of such determination, is
committed to agency discretion.
``(vi) Extension of closing date for receipt
of proposals not reviewable.--A decision by the
Secretary to extend the closing date for
receipt of proposals for a procurement under
this subsection is committed to agency
discretion.
``(vii) Limiting competition to sources
responding to request for information.--In
conducting a procurement under this subsection,
the Secretary may exclude a source that has not
responded to a request for information under
section 303A(a)(1)(B) of the Federal Property
and Administrative Services Act of 1949 (41
U.S.C. 253a(a)(1)(B)) if such request has given
notice that the Secretary may so exclude such a
source.
``(8) Interagency cooperation.--
``(A) In general.--In carrying out activities under
this section, the Homeland Security Secretary and the
Secretary are authorized, subject to subparagraph (B),
to enter into interagency agreements and other
collaborative undertakings with other agencies of the
United States Government.
``(B) Limitation.--An agreement or undertaking under
this paragraph shall not authorize another agency to
exercise the authorities provided by this section to
the Homeland Security Secretary or to the Secretary.
``(9) Restrictions on use of funds.--Amounts in the special
reserve fund under paragraph (10) shall not be used to pay--
``(A) costs for the purchase of vaccines under
procurement contracts entered into before the date of
the enactment of the Project BioShield Act of 2003; or
``(B) administrative costs.
``(10) Special reserve fund.--For purposes of this
subsection, the term `special reserve fund' has the meaning
given such term in section 510 of the Homeland Security Act of
2002.
``(d) Disclosures.--No Federal agency shall disclose under section
552, United States Code, any information identifying the location at
which materials in the stockpile under subsection (a) are stored.
``(e) Definition.--For purposes of subsection (a), the term
`stockpile' includes--
``(1) a physical accumulation (at one or more locations) of
the supplies described in subsection (a); or
``(2) a contractual agreement between the Homeland Security
Secretary and a vendor or vendors under which such vendor or
vendors agree to provide to such Secretary supplies described
in subsection (a).
``(f) Authorization of Appropriations.--
``(1) Strategic national stockpile.--For the purpose of
carrying out subsection (a), there are authorized to be
appropriated $640,000,000 for fiscal year 2002, and such sums
as may be necessary for each of fiscal years 2003 through 2006.
Such authorization is in addition to amounts in the special
reserve fund under subsection (c)(10).
``(2) Smallpox vaccine development.--For the purpose of
carrying out subsection (b), there are authorized to be
appropriated $509,000,000 for fiscal year 2002, and such sums
as may be necessary for each of fiscal years 2003 through
2006.''.
(b) Amendment to Homeland Security Act of 2002.--Title V of the
Homeland Security Act of 2002 (116 Stat. 2212; 6 U.S.C. 311 et seq.) is
amended by adding at the end the following:
``SEC. 510. PROCUREMENT OF SECURITY COUNTERMEASURES FOR STRATEGIC
NATIONAL STOCKPILE.
``(a) Authorization of Appropriations.--For procurement of security
countermeasures under section 319F-2(c) of the Public Health Service
Act (referred to in this section as the `security countermeasures
program'), there is authorized to be appropriated up to $5,593,000,000
for the fiscal years 2004 through 2013. Of the amounts appropriated
under the preceding sentence, not to exceed $3,418,000,000 may be
obligated during the fiscal years 2004 through 2008, of which not to
exceed $890,000,000 may be obligated during fiscal year 2004.
``(b) Special Reserve Fund.--For purposes of the security
countermeasures program, the term `special reserve fund' means the
appropriations account established as a result of any appropriations
made under subsection (a).
``(c) Availability.--
``(1) Duration of availability for obligation.--Subject to
paragraph (2), all amounts appropriated under subsection (a)
are available for obligation through the end of fiscal year
2013, provided that any portion of such amount that remains
unobligated for such purposes on the expiration of such term
shall be returned to the United States Treasury and shall not
be available for subsequent obligation for any purpose.
``(2) Initial availability for particular procurements.--
Amounts appropriated under subsection (a) become available for
a procurement under the security countermeasures program only
upon the approval by the President of such availability for the
procurement in accordance with paragraph (6)(B) of such
program.''.
(c) Conforming Amendments.--(1) Section 121 of the Public Health
Security and Bioterrorism Preparedness and Response Act of 2002 (116
Stat. 611; 42 U.S.C. 300hh-12) is repealed.
(2) The item relating to section 121 in the table of contents
(contained in section 1(b)) of such Act is repealed.
(3) With respect to the program established under former section 121
of such Act, the repeal of such section under paragraph (1) applies as
a modification of the program in accordance with the amendment made by
subsection (a) of this section, and not as the termination of the
program and the establishment of a different program.
SEC. 4. AUTHORIZATION FOR MEDICAL PRODUCTS FOR USE IN EMERGENCIES.
Subchapter E of chapter V of the Federal Food, Drug, and Cosmetic Act
(21 U.S.C. 360bbb et seq.) is amended by adding at the end the
following section:
``SEC. 564. AUTHORIZATION FOR MEDICAL PRODUCTS FOR USE IN EMERGENCIES.
``(a) In General.--
``(1) Emergency uses.--Notwithstanding sections 505, 510(k),
and 515 of this Act and section 351 of the Public Health
Service Act, and subject to the provisions of this section, the
Secretary may authorize the introduction into interstate
commerce, during the effective period of a declaration under
subsection (b), of a drug or device intended for use in an
actual or potential emergency (referred to in this section as
an `emergency use').
``(2) Approval status of product.--An authorization under
paragraph (1) may authorize an emergency use of a product
that--
``(A) is not approved, licensed, or cleared for
commercial distribution under a provision of law
referred to in such paragraph (referred to in this
section as an `unapproved product'); or
``(B) is approved, licensed, or cleared under such a
provision, but which use is not under such provision an
approved, licensed, or cleared use of the product
(referred to in this section as an `unapproved use of
an approved product').
``(3) Relation to other uses.--An emergency use authorized
under paragraph (1) for a product is in addition to any other
use that is authorized for the product under a provision of law
referred to in such paragraph.
``(4) Definitions.--For purposes of this section:
``(A) The term `emergency use' has the meaning
indicated for such term in paragraph (1).
``(B) The term `product' means a drug or device.
``(C) The term `unapproved product' has the meaning
indicated for such term in paragraph (2)(A).
``(D) The term `unapproved use of an approved
product' has the meaning indicated for such term in
paragraph (2)(B).
``(b) Declaration of Emergency.--
``(1) In general.--The Secretary may declare an emergency
justifying the authorization under this subsection for a
product on the basis of--
``(A) a determination by the Secretary of Homeland
Security that there is a national emergency, or a
significant potential for a national emergency,
involving a heightened risk of attack with a specified
biological, chemical, radiological, or nuclear agent or
agents;
``(B) a determination by the Secretary of Defense
that there is a military emergency, or a significant
potential for a military emergency, involving a
heightened risk to United States military forces of
attack with a biological, chemical, radiological, or
nuclear agent or agents; or
``(C) a determination by the Secretary of a public
health emergency under section 319 of the Public Health
Service Act, affecting national security and involving
a specified biological, chemical, radiological, or
nuclear agent or agents, or a specified disease or
condition that may be attributable to such agent or
agents.
``(2) Termination of declaration.--
``(A) In general.--A declaration under this
subsection shall terminate upon the earlier of--
``(i) a determination by the Secretary, in
consultation as appropriate with the Secretary
of Homeland Security or the Secretary of
Defense, that the circumstances described in
paragraph (1) have ceased to exist; or
``(ii) the expiration of the one-year period
beginning on the date on which the declaration
is made.
``(B) Renewal.--Notwithstanding subparagraph (A), the
Secretary may renew a declaration under this
subsection, and this paragraph shall apply to any such
renewal.
``(3) Advance notice of termination.--In terminating a
declaration under this section, the Secretary shall provide
advance notice that the declaration will be terminated. The
period of advance notice shall be a period reasonably
determined to provide--
``(A) in the case of an unapproved product, a
sufficient period for disposition of shipments of the
product, including the return of such shipments to the
manufacturer (in the case of a manufacturer that
chooses to have the shipments returned); and
``(B) in the case of unapproved uses of approved
products, a sufficient period for the disposition of
any labeling that was provided with respect to the
emergency use involved.
``(4) Publication.--The Secretary shall promptly publish in
the Federal Register each declaration, determination, and
renewal under this subsection.
``(c) Criteria for Issuance of Authorization.--The Secretary may
issue an authorization under this section with respect to the emergency
use of a product only if, after consultation with the Director of the
National Institutes of Health and the Director of the Centers for
Disease Control and Prevention, to the extent feasible and appropriate
given the circumstances of the emergency involved, the Secretary
concludes--
``(1) that an agent specified in a declaration under
subsection (b) can cause a serious or life-threatening disease
or condition;
``(2) that, based on the totality of scientific evidence
available to the Secretary, including data from adequate and
well-controlled clinical trials, if available, it is reasonable
to believe that--
``(A) the product may be effective in detecting,
diagnosing, treating, or preventing--
``(i) such disease or condition; or
``(ii) a serious or life-threatening disease
or condition caused by a product authorized
under this section or approved under this Act
or the Public Health Service Act, for
detecting, diagnosing, treating, or preventing
such a disease or condition caused by such an
agent; and
``(B) the known and potential benefits of the
product, when used to detect, diagnose, prevent, or
treat such disease or condition, outweigh the known and
potential risks of the product;
``(3) that there is no adequate, approved, and available
alternative to the product for detecting, diagnosing,
preventing, or treating such disease or condition; and
``(4) that such other criteria as the Secretary may by
regulation prescribe are satisfied.
``(d) Scope of Authorization.--
``(1) In general.--An authorization of a product under this
section shall state--
``(A) each disease or condition that the product may
be used to detect, diagnose, prevent, or treat within
the scope of the authorization;
``(B) the Secretary's conclusions, made under
subsection (c)(2)(B), that the known and potential
benefits of the product, when used to detect, diagnose,
prevent, or treat such disease or condition, outweigh
the known and potential risks of the product; and
``(C) the Secretary's conclusions, made under
subsection (c), concerning the safety and potential
effectiveness of the product in detecting, diagnosing,
preventing, or treating such diseases or conditions,
including an assessment of the available scientific
evidence.
``(2) Confidential information.--Nothing in this section
alters or amends section 1905 of title 18, United States Code,
or section 552(b)(4) of title 5 of such Code.
``(e) Conditions of Authorization.--
``(1) Unapproved product.--
``(A) Required conditions.--With respect to the
emergency use of an unapproved product, the Secretary,
to the extent feasible given the circumstances of the
emergency, shall, for persons who choose to carry out
one or more activities for which the authorization is
issued, establish such conditions on an authorization
under this section as the Secretary finds necessary or
appropriate to protect the public health, including the
following:
``(i) Appropriate conditions designed to
ensure that, to the extent feasible given the
circumstances of the emergency, health care
professionals administering the product are
informed--
``(I) that the Secretary has
authorized the emergency use of the
product;
``(II) of the significant known and
potential benefits and risks of the
emergency use of the product, and of
the extent to which such benefits and
risks are unknown; and
``(III) of the alternatives to the
product that are available, and of
their benefits and risks.
``(ii) Appropriate conditions designed to
ensure that, to the extent feasible given the
circumstances of the emergency, individuals to
whom the product is administered are informed--
``(I) that the Secretary has
authorized the emergency use of the
product;
``(II) of the significant known and
potential benefits and risks of such
use, and of the extent to which such
benefits and risks are unknown; and
``(III) of the option to accept or
refuse administration of the product,
of the consequences, if any, of
refusing administration of the product,
and of the alternatives to the product
that are available and of their
benefits and risks.
``(iii) Appropriate conditions for the
monitoring and reporting of adverse events
associated with the emergency use of the
product.
``(iv) For manufacturers of the product,
appropriate conditions concerning recordkeeping
and reporting, including records access by the
Secretary, with respect to the emergency use of
the product.
``(B) Authority for additional conditions.--With
respect to the emergency use of an unapproved product,
the Secretary, to the extent feasible given the
circumstances of the emergency, may, for persons who
choose to carry out one or more activities for which
the authorization is issued, establish such conditions
on an authorization under this section as the Secretary
finds necessary or appropriate to protect the public
health, including the following:
``(i) Appropriate conditions on which
entities may distribute the product with
respect to the emergency use of the product
(including limitation to distribution by
government entities), and on how distribution
is to be performed.
``(ii) Appropriate conditions on who may
administer the product with respect to the
emergency use of the product, and on the
categories of individuals to whom, and the
circumstances under which, the product may be
administered with respect to such use.
``(iii) For persons other than manufacturers
of the product, appropriate conditions
concerning recordkeeping and reporting,
including records access by the Secretary, with
respect to the emergency use of the product.
``(iv) With respect to the emergency use of
the product, waive or limit, to the extent
appropriate given the circumstances of the
emergency, conditions regarding current good
manufacturing practice otherwise applicable to
the manufacture, processing, packing, or
holding of products subject to regulation under
this Act, including such requirements
established in section 501.
``(2) Unapproved use.--With respect to the emergency use of a
product that is an unapproved use of an approved product:
``(A) The Secretary may, for manufacturers of the
product who choose to carry out one or more activities
for which the authorization is issued, establish any of
the conditions described in clauses (i) through (iv) of
paragraph (1)(A).
``(B)(i) If the authorization under this section
regarding the emergency use authorizes a change in the
labeling of the product, but the manufacturer of the
product chooses not to make such change, such
authorization may not authorize distributors of the
product or any other person to alter or obscure the
labeling provided by the manufacturer.
``(ii) In the circumstances described in clause (i),
an authorization under this section regarding the
emergency use may, for persons who do not manufacture
the product and who choose to act under this clause,
authorize such persons to provide information on the
product in addition to the labeling provided by the
manufacturer, subject to compliance with clause (i).
Such additional information shall not be considered
labeling for purposes of section 502.
``(f) Duration of Authorization.--
``(1) In general.--Except as provided in paragraph (2), an
authorization under this section shall be effective until the
earlier of the termination of the declaration under subsection
(b) or a revocation under subsection (g).
``(2) Continued use after end of effective period.--An
authorization shall continue to be effective for continued use
with respect to patients to whom it was administered during the
period described by paragraph (1), to the extent found
necessary by such patients' attending physicians.
``(g) Revocation of Authorization.--
``(1) Review.--The Secretary shall periodically review the
circumstances and the appropriateness of an authorization under
this section.
``(2) Revocation.--The Secretary may revoke an authorization
under this section if, in the Secretary's unreviewable
discretion, the criteria under subsection (c) for issuance of
such authorization are no longer met.
``(h) Publication.--The Secretary shall promptly publish in the
Federal Register a notice of each authorization, and each termination
or revocation of an authorization, and an explanation of the reasons
therefor, under this section.
``(i) Actions Committed to Agency Discretion.--Actions under the
authority of this section by the Secretary, by the Secretary of
Defense, or by the Secretary of Homeland Security are committed to
agency discretion.
``(j) Rules of Construction.--Nothing in this section shall be
construed to impair or otherwise affect--
``(1) the authority of the President as Commander in Chief of
the Armed Forces of the United States under article II, section
2 of the United States Constitution;
``(2) the authority of the Secretary of Defense with respect
to the Department of Defense, including the armed forces, under
other provisions of Federal law; or
``(3) the authority of the Secretary under section 319F-2 to
manage the stockpile under such section.
``(k) Application to Members of Armed Forces.--
``(1) Waiver of requirement relating to option to refuse.--In
the case of administration of a countermeasure to members of
the armed forces, a requirement, under subsection
(e)(1)(A)(ii)(III), designed to ensure that individuals are
informed of an option to accept or refuse administration of a
product, may be waived by the President if the President
determines, in writing, that complying with such requirement is
not feasible, is contrary to the best interests of the members
affected, or is not in the interests of national security.
``(2) Provision of information to member of the armed
forces.--If the Secretary makes a determination that it is not
feasible for the information required by subsection
(e)(1)(A)(ii) to be provided to a member of the armed forces
prior to the administration of the product, such information
shall be provided to such member of the armed forces (or next-
of-kin in the case of the death of a member) to whom the
product was administered as soon as possible, but not later
than 30 days, after such administration. Information concerning
the administration of the product shall be recorded in the
medical record of the member.
``(3) Effect on statute pertaining to investigational new
drugs.--In the case of an authorization based on a
determination by the Secretary of Defense under subsection
(b)(1)(B), section 1107 of title 10, United States Code, shall
not apply to use of a product that is the subject of such
authorization, within the scope of such authorization and while
such authorization is effective.
``(l) Relation to Other Provisions.--If a product is the subject of
an authorization under this section, the use of such product within the
scope of the author-
ization--
``(1) shall not be subject to any requirements pursuant to
section 505(i) or 520(g); and
``(2) shall not be subject to any requirements otherwise
applicable to clinical investigations pursuant to other
provisions of this Act.
``(m) Discretion Regarding Use of Authorization.--Nothing in this
section provides the Secretary any authority to require any person to
carry out any activity that becomes lawful pursuant to an authorization
under this section, and no person is required to inform the Secretary
that the person will not be carrying out such activity, except that a
manufacturer of a sole-source unapproved product authorized for
emergency use shall notify the Secretary within a reasonable period of
time after the issuance by the Secretary of such authorization if such
manufacturer does not intend to carry out an activity or activities
under the authorization. This section does not have any legal effect on
a person who does not carry out any activity for which an authorization
under this section is issued, or who carries out such an activity
pursuant to other provisions of this Act or section 351 of the Public
Health Service Act.
``(n) Enforcement.--A person who carries out an activity pursuant to
an authorization under this section, but who fails to comply with
applicable conditions under subsection (e), is with respect to that act
of noncompliance subject to the provisions of law specified in
subsection (a) and to the enforcement of such provisions under section
301.''.
SEC. 5. REPORTS REGARDING AUTHORITIES UNDER THIS ACT.
(a) Secretary of Health and Human Services.--
(1) Annual reports on particular exercises of authority.--
(A) Relevant authorities.--The Secretary of Health
and Human Services (referred to in this subsection as
the ``Secretary'') shall submit reports in accordance
with subparagraph (B) regarding the exercise of
authority under the following provisions of law:
(i) With respect to section 319F-1 of the
Public Health Service Act (as added by section
2 of this Act):
(I) Subsection (b)(1) (relating to
increased simplified acquisition
threshold).
(II) Subsection (b)(2) (relating to
use of noncompetitive procedures).
(III) Subsection (c) (relating to
expedited peer review procedures).
(ii) With respect to section 319F-2 of the
Public Health Service Act (as added by section
3 of this Act):
(I) Subsection (c)(7)(C)(iii)
(relating to simplified acquisition
procedures).
(II) Subsection (c)(7)(C)(iv)
(relating to use of noncompetitive
procedures).
(III) Subsection (c)(7)(C)(v)
(relating to premium provision in
multiple-award contracts).
(iii) With respect to section 564 of the
Federal Food, Drug, and Cosmetic Act (as added
by section 4 of this Act):
(I) Subsection (a)(1) (relating to
emergency uses of certain drugs and
devices).
(II) Subsection (b)(1) (relating to a
declaration of an emergency).
(III) Subsection (e) (relating to
conditions on authorization).
(B) Contents of reports.--The Secretary shall
annually submit to the Congress a report that
summarizes--
(i) the particular actions that were taken
under the authorities specified in subparagraph
(A), including, as applicable, the
identification of the threat agent, emergency,
or the biomedical countermeasure with respect
to which the authority was used;
(ii) the reasons underlying the decision to
use such authorities, including, as applicable,
the options that were considered and rejected
with respect to the use of such authorities;
and
(iii) the identification of each person or
entity that received, or was considered and
rejected for, grants, cooperative agreements,
or contracts pursuant to the use of such
authorities.
(2) Annual summaries regarding certain activity.--The
Secretary shall annually submit to the Congress a report that
summarizes the activity undertaken pursuant to the following
authorities under section 319F-1 of the Public Health Service
Act (as added by section 2 of this Act):
(A) Subsection (b)(3) (relating to increased
micropurchase threshold).
(B) Subsection (d) (relating to authority for
personal services contracts).
(C) Subsection (e) (relating to streamlined personnel
authority).
With respect to subparagraph (B), the report shall include a
provision specifying, for the one-year period for which the
report is submitted, the number of persons who were paid
amounts greater than $100,000 and the number of persons who
were paid amounts between $50,000 and $100,000.
(b) National Academy of Sciences Review.--Not later than three years
after the date of the enactment of this Act, the Secretary of Health
and Human Services shall request the National Academy of Sciences to
enter into an agreement for a review of the biomedical countermeasure
research and development authorities established in this Act to
determine whether and to what extent activities undertaken pursuant to
such authorities have enhanced the development of biomedical
countermeasures affecting national security, and to recommend any
legislative or administrative changes necessary to improve the ability
of the Secretary to carry out these activities in the future. The
Secretary shall ensure that the results of the study are submitted to
the Congress not later than five years after such date of enactment.
(c) General Accounting Office Review.--Four years after the date of
the enactment of this Act, the Comptroller General of the United States
shall initiate a study--
(1)(A) to review the Secretary of Health and Human Services'
utilization of the authorities granted under this Act with
respect to simplified acquisition procedures, use of
noncompetitive procedures, increased micropurchase thresholds,
personal services contracts, streamlined personnel authority,
and the purchase of security countermeasures under the special
reserve fund; and
(B) to recommend any legislative or administrative changes
necessary to improve the utilization or effectiveness of such
authorities in the future;
(2)(A) to review the internal controls instituted by such
Secretary with respect to such authorities, where required by
this Act; and
(B) to recommend any legislative or administrative changes
necessary to improve the effectiveness of such controls; and
(3)(A) to review such Secretary's utilization of the
authority granted under this Act to authorize an emergency use
of a biomedical countermeasure, including the means by which
the Secretary determines whether and under what conditions any
such authorizations should be granted and the benefits and
adverse impacts, if any, resulting from the use of such
authority; and
(B) to recommend any legislative or administrative changes
necessary to improve the utilization or effectiveness of such
authority and to enhance protection of the public health.
The results of the study shall be submitted to the Congress not later
than five years after the date of the enactment of this Act.
Committee Statement and Views
PURPOSE
The purpose of H.R. 2122, the ``Project Bioshield Act of
2003,'' is to accelerate the research, development, purchase,
and availability of countermeasures to combat bioterrorist
threats that could cause public health emergencies affecting
national security. While recent decades have yielded rapid
progress in the treatment of many serious naturally occurring
diseases, there has been little improvement in the medical
treatments available to combat potential bioterrioist threats.
Many countermeasures for potential agents of terrorism,
including smallpox, anthrax, botulinum toxin, ebola and the
plague, realistically have no market other than the government
and, thus, have not generated significant manufacturer
interest. However, should the United States be attacked with
these deadly pathogens, the need for vaccines and antitoxins
would be great and immediate.
BACKGROUND AND NEED FOR LEGISLATION
The anthrax attacks that occurred in October 2001
highlighted the nation's vulnerability to bioterrorism. Letters
laced with anthrax caused the deaths of five individuals and
thousands more received treatment. The death toll could have
been higher if there had not been effective countermeasures to
treat that particular form of anthrax. However, no such
countermeasures currently exist for many of the biological
threats that are considered the most dangerous by the Centers
for Disease Control and Prevention. For example, botulinum
toxin, plague, tularemia, and many viral hermorrhagic fevers
lack licensed vaccines.\1\
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\1\ NIAID Biodefense Research Agenda for CDC Category A Agents,
Responding through Research, National Institute of Allergy and
Infectious Diseases, National Institutes of Health, Department of
Health and Human Services (February 2002).
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The scarcity of countermeasures to combat bioterrorism can
be attributed to the lack of a significant commercial
market.\2\ Because these diseases occur infrequently, there has
been little economic incentive for pharmaceutical and biotech
companies to make the significant investment required to bring
new treatments to market. To promote the development of new
countermeasures to combat bioterrorism, President Bush proposed
Project Bioshield in his 2003 State of the Union address. H.R.
2122 is modeled after this proposal and would provide expedited
procedures for bioterrorism-related procurement and research
and development.
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\2\ Project Bioshield: Contracting for the Health and Security of
the American Public: Committee on Government Reform, 108th Congress
(April 4, 2003) (Statement of Dr. Mark B. McClellan, Commissioner, Food
and Drug Administration and Dr. Anthony S. Fauci, Director, National
Institute of Allergy and Infectious Diseases, National Institutes of
Health).
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The bill has three main provisions. First, it would provide
the Secretary of the Department of Health and Human Services
(HHS) with streamlined authorities to promote the research and
development of drugs and other products needed to protect
Americans in the event of a bioterrorist attack. As a result,
should the Secretary determine that there is pressing need to
develop these products, the Secretary would be able to use
simplified acquisition tools for research and development
projects and would have expedited authorities to award research
grants and to hire technical experts and consultants.
Second, the bill authorizes the procurement of biomedical
countermeasures for the nation's stockpile using a special
reserve fund. The bill authorizes $5.93 billion for fiscal
years 2004 to 2013 for this fund. The Secretary of HHS and the
Secretary of the Department of Homeland Security would be
required to work together to recommend to the President the
countermeasures that are needed for the stockpile. Procurements
of countermeasures using the special reserve fund could only be
made with the approval of the President. If the Secretary of
HHS determines there is a pressing need to acquire certain
products, the Secretary could use simplified acquisition
procedures for the procurement of biomedical countermeasures.
Nothing in these provisions would limit the use of existing
authorities of the Secretary of HHS and the Secretary of the
Department of Homeland Security to enter into an agreement that
provides for research and development as well as production of
a countermeasure or vaccine under a single procurement, where
such a single agreement (including a contract, grant,
cooperative agreement, or other acquisition instrument) for
research, development, and production of a countermeasure or
vaccine is deemed appropriate by the proper official. This
would include instances when a separate funding source is
authorized and used for the research and development and that
funding is different than the funding source authorized and
used for production. The Committee recognizes that such
agreements providing express linkage between research,
development, and production are likely to encourage entities to
enter the government market for countermeasures and vaccines in
accordance with the authorities provided by the ``Project
Bioshield Act'' and urges their use where appropriate.
The Committee notes that the authorities that can be used
by the Secretary of HHS in title XIV, Section 1451 of H.R. 1588
and provided to the Secretary of the Department of Homeland
Security in title VIII, Section 831 of the Homeland Security
Act of 2002 are applicable to research and development
(including the development of a prototype) conducted under this
Act.\3\
---------------------------------------------------------------------------
\3\ The Homeland Security Act of 2002, Public Law 107-296; 116
Stat. 2224.
---------------------------------------------------------------------------
The third provision of the bill provides that in the event
of a national emergence, the government would be authorized to
make available new and promising treatments prior to approval
by the Food and Drug Administration (FDA). The government may
exercise this authority if the product is in the approval
process and is urgently needed because no adequate alternatives
exist. There also must be a reasonable basis to conclude that
the countermeasure will be effective and that the benefits of
the product outweigh the risks. Although this provision would
permit the avoidance of the FDA approval process, its use
should be limited to dire circumstances.
The Committee is aware of the growing problem of naturally
occurring infections becoming increasingly resistant to
existing antimicrobial drug products. Antimicrobial resistance
is the phenomenon whereby infectious microbes mutate and become
less susceptible to treatment with currently approved drugs.\4\
In the hands of bioterrorists, these organisms can be used to
affect national security and accordingly should be considered a
material threat under Project Bioshield. For example, published
documents describe how the Russians produced antibiotic-
resistant anthrax.\5\ However, the Committee understands that
there has been limited progress in the development of
countermeasures to combat the emergence of antimicrobial-
resistant organisms.\6\ One reason may be that the market for
the few cases of multi-drug resistant bacteria is currently
quite small. Success in developing appropriate countermeasures
to treat emerging antibiotic resistant organisms could thwart
attempts to use these organisms for bioterrorism. Inclusion of
organisms with emerging antibiotic resistance within the list
of biological threats contemplated by Project Bioshield should
permit acceleration of research for and government procurement
of new drugs and vaccines to treat or prevent infections caused
by these agents.
---------------------------------------------------------------------------
\4\ Project Bioshield: Contracting for the Health and Security of
the American Public: Committee on Government Reform, 108th Congress
(April 4, 2003) (Statement of Dr. John E. Edwards on behalf of the
Infectious Diseases Society of America).
\5\ AV Stepanov, LI Marinin, AP Pomerantsev, NA Staritsin,
Development of Novel Vaccines Against Anthrax in Man, J Biotechnol,
Jan. 26, 1996.
\6\ Microbial Threats to Health Emergence, Detection, and Response,
Committee on Emerging Microbial Threats to Health in the 21st Century,
Board on Global Health, (Mark S. Smolinski et al. eds., The National
Academies Press forthcoming 2003). According to this publication, in
the past three decades, only two new classes of antibiotics have been
developed, and resistance to one class emerged even before the drugs
entered the commercial marketplace. Only four large pharmaceutical
companies with antibiotic research programs remained in existence in
2002 and not one new class of antibiotics is in advanced development.
---------------------------------------------------------------------------
COMMITTEE HEARINGS AND TESTIMONY
The Committee on Government Reform held a hearing to
consider the ``Project Bioshield Act'' on April 4, 2003. The
committee heard testimony from the following witnesses: Dr.
Anthony Fauci, Director, National Institute of Allergy and
Infectious Diseases, National Institutes of Health; Dr. Mark
McClellan. Commissioner, Food and Drug Administration; Michael
Brown, Under Secretary for Emergency Preparedness and Response,
Department of Homeland Security; Dr. Dale Klein, Assistant to
the Secretary of Defense for Nuclear, Chemical and Biological
Defense Programs, Department of Defense. The Committee also
heard from experts representing the pharmaceutical and biotech
industries. These witnesses included Frank Rapoport, attorney
at law, representing Aventis Pasteur; Dr. Michael Friedman,
Chief Medical Officer for Biomedical Preparedness,
Pharmaceutical Research and Manufacturers of America; Dr. Una
Ryan, President, AVANT Immunotherapeutics, Inc.; Katherine
Bowdish, Ph.D., President, Alexion Antibody Technologies; and
Dr. John Edwards, Chief of Infectious Diseases, Harbor-UCLA
Medical Center, on behalf of the Infectious Diseases Society of
America.
The witnesses were supportive of the bill. They generally
agreed with the need to create incentives for manufacturers to
develop biomedical countermeasures through the creation of a
government market. The witnesses from the pharmaceutical and
biotech industries offered suggestions to amend the bill.
Specifically, Mr. Rapoport suggested including language to
clarify that the government is authorized to enter into single
procurement contracts for research, development and production.
He also suggested including additional contracting flexibility
through ``other transaction'' authority for research and
development contracts similar to the authority that is used by
the Department of Defense. Witnesses also discussed the need
for the bill to include liability protection for manufacturers
to further encourage companies to develop countermeasures. Dr.
Edwards testified about the need for the bill to cover the
development of countermeasures to combat naturally occurring
diseases that have become resistant to antimicrobial products.
Section-by-Section Analysis
Section 1. Short title
The short title of the bill is the ``Project Bioshield Act
of 2003.''
Section 2. Biomedical countermeasure research and development
authorities
This section would amend the Public Health Service Act to
grant the Secretary of Health and Human Services (HHS)
additional flexibility and authority to conduct research and
development of drugs, vaccines and other products to combat
biological, chemical, nuclear, and radiological agents that may
affect national security.
Expedited procurement authority
This section provides the Secretary of HHS with enhanced
procurement authorities to perform, administer, or support
biomedical countermeasure research and development. The
simplified acquisition threshold would be increased from
$100,000 to $25 million for the purchase of property or
services the Secretary determines are needed to perform
pressing biomedical countermeasure research and development.
The simplified acquisition procedures have been in law since
the mid-1990s and are designed to promote efficiency and
economy in contracting and to avoid unnecessary burdens for
agencies and contractors. Procurements by the Secretary of HHS
of products or services under the simplified acquisition
threshold would be subject to contract work hours and safety
standards, anti-kickback rules, and provisions authorizing the
examination of contractor records. Additionally, the Secretary
would be required to institute internal controls for
procurements made under this authority, including documenting
the justification for use of the simplified procedures.
After making the required determination of pressing need,
the Secretary of HHS would also be authorized to use other than
competitive procedures for procurements of biomedical
countermeasures when there are only a limited number of
responsible sources and no other type of property or services
will satisfy the Secretary's needs. For the purposes of using
other than competitive procedures in this section, the phrase
in section 303(c)(1) of title III of the Federal Property and
Administrative Services Act of 1949, ``available from only one
responsible source'' shall be deemed to mean ``available from
only one responsible source or only from a limited number of
responsible sources.'' The other than competitive procedures
authorized under this section are to be implemented in
accordance with the justification and approval provisions of 41
U.S.C. 253(f) and the notice provisions of 41 U.S.C. 416. This
expanded authority would be in addition to any other authority
to use procedures other than competitive procedures.
This section also increases the micropurchase threshold
from $2,500 to $15,000 for the procurement of property or
services that are determined to be necessary for pressing
countermeasure research and development. The Secretary would be
required to institute internal controls for purchases greater
than $2,500.
Authority to expedite peer review
The Secretary would be authorized to expedite the award
process for grants, contracts, and cooperative agreements for
biomedical countermeasure research and development if the
Secretary deems there is a pressing need for the expedited
award. This authority would be limited to awards of not more
than $1.5 million and would give the Secretary greater
flexibility to determine which research projects would be
funded. Peer review is designed to maximize the chances that
only proposals with the greatest scientific merit receive
funding. The normal peer review process to consider grant
proposals may take up to one year.
Authority for personal services contracts and streamlined
personnel authority
This section would also give the Secretary streamlined and
flexible personnel authorities for the purpose of performing,
administering, and supporting qualified countermeasure research
and development. Under these authorities, the Secretary could
hire experts or consultants, without regard to limitations on
service or pay. The Secretary could also appoint professional
or technical employees to perform pressing countermeasure
research and development without regard to provisions in Title
5 of the U.S. Code governing classification, pay rates, and
appointments in the competitive service.
The authorities in this section would be committed to
agency discretion. However, interested parties would have the
authority to protest contracting decisions to the contracting
agency, the General Accounting Office or the Federal Court of
Claims.
Section 3. Biomedical countermeasures procurement
Procurement of certain biomedical countermeasures and
availability of special reserve fund
Section 3 addresses the procurement of biomedical
countermeasures for inclusion in the National stockpile. The
section would require the government to follow certain
procedures to determine whether to buy biomedical
countermeasures from a special reserve fund created by the Act.
The Secretary of the Department of Homeland Security (DHS)
would be required to assess threats to the U.S. population that
are posed by the use of chemical, biological, radiological, and
nuclear agents. The Secretary of HHS would be required to
assess the public health consequences of the use of such agents
and the availability and appropriateness of countermeasures to
combat the threats. After performing this analysis, both the
Secretary of HHS and DHS could jointly recommend that the
President procure countermeasures for the Nation's stockpile,
using the special reserve fund. Nothing in the Act would
restrict or alter existing authority to purchase items for the
stockpile using existing discretionary appropriations for such
purpose.
If the President approves the recommendation to procure a
countermeasure from the special reserve fund, the Secretaries
would enter into an agreement under which the Secretary of HHS
would procure the countermeasure for the stockpile using the
special reserve fund maintained by the Department of Homeland
Security. The Secretaries would be required to notify Congress
of decisions to procure a countermeasure.
Under the Act, contractors could generally not be paid
until a substantial portion of the countermeasure is delivered.
However, the Secretary of HHS could make an advance payment of
up to 10 percent, if necessary, to ensure success of a project.
Contracts for biomedical countermeasures could last for five
years, but could be extended for up to eight years, if the
Secretary of HHS determines that a longer period is justified
because of complexities or other performance difficulties. The
contract can be renewed for additional periods not to exceed
five years. This section also contains a number of provisions
concerning contractor storage of stockpile items, payment of
premiums where there are multiple contractors, extension of
closing dates for receipt of proposals, and the exclusion of
sources for failure to respond to a request for information.
The Secretary of HHS would have enhanced procurement
authorities for the purchase of biomedical countermeasures if
the Secretary determines that there is a pressing need. The
Secretary could use simplified acquisition procedures to
procure any biomedical countermeasure. Contractor work hours
and safety standards, anti-kickback rules, and provisions
authorizing examination of contractor records would apply to
the contracts. Additionally, after a determination of pressing
need, the Secretary of HHS could use other than competitive
procedures if the product is available from only one
responsible source or from a limited number of responsible
sources and no other type of product will satisfy the
Secretary's needs.
The Secretary of HHS would be authorized to use other than
competitive procedures for procurements of biomedical
countermeasures when there are only a limited number of
responsible sources and no other type of property or services
will satisfy the Secretary's needs. For the purposes of using
other than competitive procedures in this section, the phrase
in section 303(c)(1) of title III of the Federal Property and
Administrative Services Act of 1949, ``available from only one
responsible source'' shall be deemed to mean ``available from
only one responsible source or only from a limited number of
responsible sources.'' The other than competitive procedures
authorized under this section are to be implemented in
accordance with the justification and approval provisions of 41
U.S.C. 253(f) and the notice provisions of 41 U.S.C. 416. This
expanded authority would be in addition to any other authority
to use procedures other than competitive procedures.
Authorization of appropriations
For procurements of biomedical countermeasures from the
special reserve fund, the bill authorizes $890 million in FY
2004 and $3.4 billion and $5.6 billion over the next five and
ten fiscal years respectively. All amounts appropriated under
this authorization would be available for obligation through
the end of FY 2013.
Section 4. Authorization for medical produces for use in emergencies
Section 4 of the Act amends the Food, Drug, and Cosmetic
Act by permitting the Secretary of HHS to authorize the
emergency use of drugs, devices, or biological products prior
to approval, clearance or license by the FDA. The emergency use
of unapproved products could only be performed during times of
military, national, or public health emergencies. To exercise
this authority the Secretary of HHS must conclude that:
(1) A biological, chemical, radiological or nuclear
agent can cause a serious or life-threatening disease;
(2) Based on scientific evidence, the product may be
effective in detecting, diagnosing, treating, or
preventing the disease;
(3) The known and potential benefits of the product
outweigh the known or potential risks;
(4) There is no adequate alternative to the product
that is already approved and available; and
(5) Any other criteria specified by the Secretary of
HHS.
A declaration of an emergency can last for a maximum of one
year unless the Secretary of HHS renews it. If the Secretary
authorizes the use of an unapproved product, the Secretary
shall place certain conditions on such authorization (including
conditions intended to provide information to both health care
professionals administering the product and the recipients of
the product) and may place other conditions on the
authorization at the Secretary's discretion.
The Secretary of HHS may authorize a new, emergency dual
use for existing FDA approved products to treat alternate
diseases. Manufacturers that wish to avail themselves of such
an emergency use authorization may be subjected to certain
conditions.
Nothing in Section 4 requires any manufacturer,
distributor, physician, pharmacist, or other person to make a
product available under the emergency use authorization.
However, if a person chooses to provide an emergency use
product, he or she must follow conditions imposed by the
Secretary of HHS. Persons failing to comply with applicable
conditions under this provision will be treated as if they are
providing an unapproved drug or device and could be subject to
enforcement actions.
Section 5. Reports regarding authorities under this Act
The Secretary of HHS must submit an annual report to
Congress detailing and summarizing the Secretary's exercise of
the new authorities authorized in the previous sections of the
bill. Studies by the National Academy of Sciences and the
General Accounting Office concerning implementation of this Act
would be required as well.
Explanation of Amendments
The provisions of the substitute are explained in this
report.
Committee Consideration
H.R. 2122 was introduced by Representative W.J. (Billy)
Tauzin (LA) on May 15, 2003, and was cosponsored by Rep. John
Dingell (MI), Rep. Tom Davis (VA), Rep. Christopher Cox (CA),
Rep. Ed Markey (MA), Rep. Mike Bilirakis (FL), Rep. Jim Davis
(FL), Rep. Fred Upton (MI), Rep. Cliff Stearns (FL), Rep. John
Shadegg (AZ), Rep. Darrell Issa (CA), Rep. Lincoln Diaz-Balart
(FL), and Rep. Anna Eshoo (CA). The bill was referred to the
Committee on Energy and Commerce, the Committee on Government
Reform, and the Select Committee on Homeland Security.
On May 22, 2003, the Committee on Government Reform met in
open session to consider H.R. 2122 along with seven other
bills. The committee favorably approved the bill as amended by
voice vote and reported it to the House of Representatives. The
Energy and Commerce Committee approved H.R. 2122 by a voice
vote on May 15, 2003.
At the full committee business meeting, an amendment in the
nature of substitute offered by Government Reform Committee
Chairman Tom Davis (VA) was approved by a voice vote. The
amendment makes three changes to the bill. First, the amendment
applies the ``pressing need'' standard used for research and
development procurement in section 2, to biomedical
countermeasure procurements in section 3. Second, section 2 of
the bill would commit decisions about research and development
projects to the HHS Secretary's discretion. The amendment would
permit interested parties to protest research and development
contracting decisions to the contracting agency, the
Comptroller General, or the United States Court of Federal
Claims. The amendment also makes technical changes in sections
2 and 3 to clarify the circumstances when the Secretary of HHS
could use other than competitive procedures for research and
development and production contracts.
Application of Law to the Legislative Branch
Section 102(b)(3) of Public Law 104-1 requires a
description of the application of this bill to the legislative
branch. This bill accelerates the research, development,
purchase, and availability of countermeasures to combat
bioterrorist threats that could cause public health emergencies
affecting national security. The benefits of this bill apply
equally to employees of the legislative branch.
Statement of Oversight Findings and Recommendations of the Committee
In compliance with clause 3(c)(2) of rule XIII and clause
(2)(b)(1) of rule X of the Rules of the House of
Representatives, the Committee's oversight findings and
recommendations are reflected in the descriptive portions of
this report.
Statement of General Performance Goals and Objectives
In accordance with clause 3(c)(4) of rule XIII of the Rules
of the House of Representatives, the Committee's performance
goals and objectives are reflected in the descriptive portions
of the report.
Constitutional Authority Statement
Under clause 3(d)(1) of rule XIII of the Rules of the House
of Representatives, the Committee must include a statement
citing the specific powers granted to Congress to enact the law
proposed by H.R. 2122. The constitutional authority to enact
this law lies within the General Welfare and Necessary and
Proper clauses of Article I, Section Eight of the United States
Constitution.
Unfunded Mandate Statement
Section 423 of the Congressional Budget and Impoundment
Control Act (as amended by Section 101(a)(2) of the Unfunded
Mandate Reform Act, P.L. 104-4) requires a statement whether
the provisions of the reported include unfunded mandates. In
compliance with this requirement the Committee has received a
letter from the Congressional Budget Office included herein.
Committee Estimate
Clause 3(d)(2) of rule XIII of the Rules of the House of
Representatives requires an estimate and a comparison by the
Committee of the costs that would be incurred in carrying out
H.R. 2122. However, clause 3(d)(3)(B) of that rule provides
that this requirement does not apply when the Committee has
included in its report a timely submitted cost estimate of the
bill prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act.
Budget Authority and Congressional Budget Office Cost Estimate
With respect to the requirements of clause 3(c)(2) of rule
XIII of the Rules of the House of Representatives and section
308(a) of the Congressional Budget Act of 1974 and with respect
to requirement of clause (3)(c)(3) rule XIII of the Rules of
the House of Representatives and section 402 of the
Congressional Budget Act of 1974, the Committee has received
the following cost estimate for H.R. 2122 from the Director of
Congressional Budget Office.
U.S. Congress,
Congressional Budget Office,
Washington, DC, June 6, 2003.
Hon. Tom Davis,
Chairman, Committee on Government Reform,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2122, the Project
BioShield Act of 2003.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Jeanne De
Sa and Sam Papenfuss.
Sincerely,
Douglas Holtz-Eakin,
Director.
Enclosure.
H.R. 2122--Project BioShield Act of 2003
Summary: H.R. 2122 would amend the Public Health Service
Act (PHSA) to authorize appropriations of up to $5.6 billion
for fiscal years 2004 through 2013 for procurement of certain
security countermeasures (drugs, devices, and biological
products to treat, identify, and prevent the public health
consequences of terrorism). Of that amount, $890 million could
be obligated in fiscal year 2004 and up to $3.4 billion could
be obligated during fiscal years 2004 though 2008. Funding to
buy these security countermeasures would be provided to the
Department of Homeland Security (DHS), but the Department of
Health and Human Services (HHS) would be responsible for
procuring and stockpiling the countermeasures.
Assming appropriation of authorized amount and including
administrative costs, CBO estimates that implementing H.R. 2122
would increase discretionary spending by $0.3 billion in 2004,
$3.1 billion for fiscal years 2004 through 2008, and $5.6
billion over the 2004-2013 period. In addition, H.R. 2122 would
relax certain requirements for federal agencies related to the
development and approval of countermeasures. The bill would
provide HHS with increased authority and flexibility to award
contracts and grants for research and development of qualified
countermeasures, hire technical experts, and procure items
necessary for research. Those provisions might result in higher
discretionary spending, but CBO does not have sufficient
information to estimate their budgetary effect.
The bill also would authorize the Food and Drug
Administration (FDA) to approve the use of certain security
countermeasures during emergencies designated by the Secretary
of HHS. CBO estimates this provision would have no budgetary
effect.
H.R. 2122 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments.
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 2122 is shown in the following table.
The costs of this legislation fall within budget function 550
(health). CBO assumes that H.R. 2122 would be enacted by
October 1, 2003.
----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
----------------------------------------------------------------------------------------------------------------
CHANGES IN DISCRETIONARY SPENDING
Project BioShield:
Estimated authorization 890 2,528 0 0 0 2,175 0 0 0 0
level......................
Estimated outlays........... 270 680 870 770 510 440 560 650 490 250
Administrative costs:
Estimated authorization 9 9 9 9 10 10 10 10 11 11
level......................
Estimated outlays........... 7 8 9 9 10 10 10 10 11 11
----------------------------------------------------------------------------------------------------------------
Basis of estimate
CBO assumes that this bill will be enacted during fiscal
year 2003 and will take effect in October 2003.
Procurement of security countermeasures: Project BioShield
Under current law, HHS administers the Strategic National
Stockpile (SNS), which contains drugs diagnostic devices,
vaccines, and other biological products to combat the public
health consequences of a terrorist attack or other public
health emergencies. DHS currently provides the financing for
those efforts, which include the procurement of a new smallpox
vaccine and stockpiling of that vaccine and older versions of
the vaccine. Authorization for those programs was established
in the Public Health Security and Bioterrorism Preparedness
Response Act of 2002 (Public Law 107-88). That act authorized
appropriations of $640 million in 2002 and such sums as may be
necessary for fiscal years 2003 through 2006 for the SNS and
$509 million in 2002 and such sums as may be necessary for
fiscal years 2003 through 2006 for the development of the
smallpox vaccine. About $400 million was appropriated in 2003
for those activities.
H.R. 2122 would modify the existing authorizations for the
SNS and for the development of the smallpox vaccine by
codifying the provision in the PHSA instead of in Public Law
107-88. CBO estimates that this modification would have no
budgetary effect.
H.R. 2112 also would authorize DHS to augment the SNS with
certain additional products. That effort, called Project
BioShield, would allow the federal government to enter into
contracts to procure security countermeasures, which are
defined in the bill as drugs, devices, biological products,
vaccines, vaccine adjuvants, antivirals, or diagnostic tests
used to treat, identify, or prevent harm from an agent that the
Secretary determines may cause a public health emergency
affecting national security. Such drugs, devices, or biological
products would have to be licensed or approved by the FDA, or
otherwise determined by the Secretary of HHS to have the
potential to be licensed or approved by the FDA. The federal
government also could acquire products used to treat the
adverse effects of drugs or biologic products used as security
countermeasures.
The rate at which the funding authorized by the bill would
be appropriated and spent would depend upon many factors,
including the nature of advances in biotechnology, the degree
of industry interest and capacity, the threat environment, and
government priorities. Assuming appropriation of the authorized
amounts, current and future Administrations would have the
discretion to enter into multiple contracts for the manufacture
of security countermeasures or to cease contracting altogether
for a period of years.
To estimate spending under H.R. 2122, CBO consulted with
Administration officials about activities they are planning or
would consider if Project BioShield were enacted. Officials
described plans to acquire and maintain stockpiles of seven
security countermeasures to combat five biological agents. The
Administration estimates that the cost of procuring, storing,
and replacing those countermeasures would be about $5.6 billion
over the 2004-2013 period if there were no constraints on
funding.
Those currently planned acquisitions do not include any
countermeasures for chemical, readiological, or nuclear agents,
and they address only a subset of the threats for which
research and development activities on countermeasures is being
conducted or funded by HHS, the Department of Defense (DoD),
and the private sector. Based on information provided by
government officials and in consultation with outside experts,
CBO has concluded that it is likely that drugs, devices, or
biological products addressing some of those other threats will
be developed in the coming decade and that some of those
countermeasures would be stockpiled under Project Bioshield if
funds were appropriated for that purpose. CBO's estimate does
not assume that any specific product would be developed and
procured at any specific time. It does, however, account for a
range of possibilities that would be available to the
government if the authorized funds are appropriated.
Authorities and Requirements Under H.R. 2122. H.R. 2122
would authorize appropriations of up to $5.6 billion for fiscal
years 2004 through 2013 for the federal government to enter
into contracts to procure security countermeasures. Of that
amount, $890 million could be obligated in fiscal year 2004 and
up to $3.4 billion could be obligated during fiscal years 2004
through 2008.
Decisions regarding what types of security countermeasures
to procure would be made by the President after reviewing
recommendations of the Secretaries of DHS and HHS. Subject to
Presidential approval and a determination that inclusion of
certain countermeasures in the stockpile is appropriate, the
Secretaries of DHS and HHS would seek potential vendors to
produce the countermeasures and enter into contracts to buy the
countermeasures from these vendors. In making that
determination, the Secretary would determine and consider
several factors, including the quantity of the product
necessary for the stockpile, the feasibility of obtaining
sufficient quantities of the product within five years, and
whether there is a significant commercial market for the
product other than as a security countermeasure. Those factors
would not be requirements for procurement, but considerations
in determining the appropriateness for inclusion of the
countermeasure in the stockpile.
The Secretary of HHS would be responsible for arranging the
procurement, including negotiating the quantity, price, and
production schedule in five-year contracts or cooperative
agreements, though eight-year contracts would be permitted for
first awards. Payment would be conditioned on the delivery of a
substantial portion of promised units. However, the Secretary
could provide an advance payment of not to exceed 10 percent of
the contract if the Secretary determines such payment is
necessary to the project's success. The Secretary could pay
vendors for storage, shipping, and handling and would be
permitted to use noncompetitive procedures if the product is
available only from a limited number of sources. Additional
countermeasures for the same threat also could be procured, if
they were to provide improved safety or effectiveness or
otherwise enhance public health preparedness.
The authorized funds could not be used for the purchase of
vaccines under contracts entered into prior to enactment, or
for administrative costs. Based on information from
Administration officials, CBO expects that funding would not be
available specifically for research and development, although
the price for the completed products would probably cover some
development costs.
The Administration's Plans To Implement Project BioShield.
Based on existing science and a current assessment of potential
threats to public health, the Administration has identified
several agents for which countermeasures are needed to protect
the public health and could be included in Project BioShield.
Those agents are smallpox, anthrax, botulinum toxin, plague,
and Ebola. The Administration estimates that spending for
countermeasures under Project BioShield, including purchase,
storage, and replacement costs, would total about $5.6 billion
over the 2004-2013 period, assuming the successful development
of those countermeasures and no constraints on funding. More
than half of those costs would be for the improved smallpox and
anthrax vaccines. A brief description follows of the security
countermeasures the Administration plans to acquire and
stockpile.
Smallpox. Under Project BioShield, the Administration plans
to procure a next-generation version of the smallpox vaccine
called modified vaccinia Ankara (MVA). This new vaccine is an
attenuated version of the existing vaccine and may be used to
safely vaccinate about 30 million individuals with compromised
immune systems, eczema, or certain other high-risk conditions.
Under the authority provided for Project BioShield, HHS plans
to purchase 60 million doses of the new vaccine at about $15
per dose over a three-year period for a cost of about $900
million. The Administration expects to be able to enter into
contracts and begin acquiring the vaccine in 2004. Additional
costs for inventory management and replacement of expired
stocks over the 2007-2013 period would likely add another $1
billion, according to Administration estimates, but could be
lower if long-term refrigerated storage proves to be effective.
Anthrax. The Administration also expects to purchase about
60 million doses of a next-generation anthrax vaccine, called a
recombinant protective antigen (rPA) vaccine, under Project
BioShield. The rPA vaccine require fewer doses per person than
the current vaccine, and potentially could be effective for
people who have already been exposed to anthrax, giving the
government the ability to vaccinate about 20 million people.
The Administration anticipates beginning the procurement
process in the next few years and spending about $700 million
on the vaccine over a three-year period. Because the rPA
anthrax vaccine has an expected shelf life of five to six
years, additional costs would be incurred for inventory
management and replacement. The Administration estimates that
costs for the rPA vaccine could total $1.4 billion over the
2004-2013 period.
Botulinum Toxin. Under current law, HHS has stockpiled some
antitoxins to treat botulism, a paralytic and often fatal
illness caused by a nerve toxin produced by the botulinum
bacteria. However, those antitoxins are no longer manufactured,
and the manufacturing process, which requires horse serum, is
complicated and time intensive. After identifying a
manufacturer, the Administration plans to spend about $800
million acquiring newly produced antitoxin at a cost of about
$2,000 per dose as part of Project BioShield. Acquisition would
be spread over a three-year period, beginning in the next few
years. This antitoxin would require specialized storage and
refrigeration.
In addition, the Administration has indicated that it would
like to purchase both a vaccine that would protect against
botulism and monoclonal antibodies to neutralize the effects of
the toxin. (Monoclonal antibodies are engineered proteins that
can neutralize and destroy certain pathogens and toxins.) The
Administration anticipates buying vaccine and monoclonal
antibodies by 2007 or 2008, at a cost of about $140 million for
750,000 doses of the vaccine and $750 million for monoclonal
antibodies. The Administration estimates that spending for
botulinum countermeasures, including the cost of storage and
inventory management, would total $1.8 billion over the 2004-
2013 period.
Plague. Plague is an infectious disease caused by a
bacterium. Plague has several forms--pneumonic, bubonic, and
septicemic--and can be treated by existing antibiotics. A
vaccine for the plague is currently in the research and
development phase, with the expectation that a product
potentially could reach the advanced development phase next
year. Beginning in 2005, the Administration expects to procure
about 2 million doses (enough to treat people in areas
surrounding any outbreak) at an estimated cost of about $40 per
dose--for a total cost of about $80 million. With additional
costs related to the acquisition of the vaccine, the
Administration estimates spending on plague countermeasures
would total about $220 million over the 2004-2013 period.
Ebola. There is no current treatment for Ebola, one of
several viral hemorrhagic fevers, but the National Institutes
of Health (NIH) is conducting research on a vaccine that the
Administration would be interested in purchasing when it
reaches an advanced development stage. Under current plans, the
Administration intends to purchase enough vaccine for 3 million
individuals to prevent the spread of an outbreak. Because this
vaccine is still in the research and development phase, when
the vaccine would become available and the potential cost per
dose are unclear. The Administration assumes the vaccine will
become available in 2005, and estimates the price to be about
$30 per dose, for a total acquisition cost of $90 million.
Combined with other costs related to the Ebola vaccine,
including storage and replacement, the Administration
anticipates spending would total about $260 million over the
2004-2013 period for this aspect of Project BioShield.
CBO's Estimate of the Potential Cost of Project BioShield.
CBO has estimated both the cost of implementing the
Administration's plan and the potential cost of acquiring other
products not encompassed by that plan.
CBO's Estimate of the Administration's Plan. Without any
funding constraints, CBO expects that the Administration's
plans for MVA smallpox vaccine, the anthrax rPA vaccine, and
the botulism antitoxins would likely take shape as described,
albeit more slowly than the Administration estimates. CBO
estimates that spending for vaccines and monoclonal antibodies
for botulism and vaccines for plague and Ebola would likely be
lower than the Administration estimates, even without funding
constraints. CBO's lower estimate reflects the possibility that
development of those vaccines and monoclonal antibodies might
not succeed as quickly as the Administration's estimate
assumes. It also reflects the possibility that Project
BioShield would spend less on some of the botulism
countermeasures if all three countermeasures (vaccine,
antitoxins, and monoclonal antibodies) became available.
CBO estimates that about $5.2 billion would be required to
procure products identified by the Administration over the
2004-2013 period.
Estimated Spending for Products Not Listed in the
Administration's Plan. Under the bill, other countermeasures
not in the Administration's plan could be purchased with
appropriations provided through Project BioShield.
Consequently, the specific security countermeasures that would
be acquired under H.R. 2122 are likely to evolve over time as
the result of many factors, including scientific advances, the
interest and cooperation of biotech and other manufacturing
companies, the emergence of new threats, and changes in this
and future Administrations' assessments of which potential
countermeasures should be a priority. Barriers to technological
advance such as restricted laboratory space or shortage of
primates for testing could slow development of countermeasures
for certain agents. At the same time, rapid advances in
products currently in the early-stage research and development
could present the government with unforeseen countermeasure
options. Acquisition of countermeasures would also be affected
by whether this and future Administrations decide to procure
products that require more than five years to be licensed or
have a significant commercial market.
Acquisitions under the bill might include additional
countermeasures for agents addressed by the Administration's
plan. For instance, potential emerging treatments include the
use of monoclonal antibodies. This technology has had initial
application in the treatment of cancer, and possibly could be
applied to anthrax, the plague, or viral hemorrhagic fevers in
the coming years. Other potential countermeasures include new
antiviral drugs to treat smallpox and viral hemorrhagic fevers
(both biodefense research priorities for NIH) and a narrow-
spectrum antibiotic for anthrax.
In addition, CBO's research indicates there are numerous
other biological agents for which countermeasures ultimately
could be purchased under Project BioShield. HHS has established
three classes of biological agents that pose significant risks
to national security and the public health. Category A agents
pose the greatest risk due to their ease of transmission,
mortality rates, and overall risk to the public. All of the
agents included in the Administration's plan are considered
Category A agents, but that initial plan does not address such
Category A agents as tularemia, a bacterial infection affecting
the respiratory system, and viral hemorrhagic fevers other than
Ebola. Vaccines for both of those agents are biodefense
research priorities of NIH. Further, the government might seek
countermeasures for some Category B and C agents, including
toxins such as ricin, certain bacteria such as brucellosis, and
several forms of viral encephalitis.
Also, under the authority provided by the bill, the
government could procure countermeasures against chemical
agents (nerve, blister, blood, and pulmonary agents) and
radiological and nuclear agents. The Administration currently
does not plan to use the bill's authority to purchase agents
that could mitigate threats from these sources, but it could do
so if the perceived threat from these agents changed or if
certain treatments became scientifically feasible.
Countermeasures that could be acquired under Project BioShield
include existing treatments for many nerve gases (including VX,
Sarin, and Soman gas), Prussian Blue (a treatment for certain
types of radiation poisoning), and hydroxycobalamin (a
treatment for cyanide poisoning that is in an advanced stage of
development).
Finally, under H.R. 2122, Project BioShield would be able
to purchase devices to detect and diagnose pathogens and other
agents. Costs for such devices are also not included in the
Administration's estimate.
To estimate potential spending for additional
countermeasures not mentioned in the Administration's plan, CBO
identified several category A, B, and C biological agents and
chemical and radiological agents for which countermeasures
exist or are under development. The set of selected agents and
countermeasures is not intended as a prediction of which
countermeasures would be acquired by Project BioShield. Rather,
it is intended to be representative of the countermeasures that
would be eligible for acquisition if current research and
development activities succeed in producing qualified
countermeasures during the coming decade.
For each of the representative biological agents, CBO
determined whether the countermeasure is likely to be a
vaccine, an antitoxin or antiviral, or a monoclonal antibody,
the dosage and method of delivery (intravenously or in pill
form), and the amount necessary to treat the population that
could potentially be affected. The estimate assumes that
vaccines would cost $30 to $40 per dose, on average, with
Project BioShield acquiring 500,000 to 2 million doses of
qualified vaccines, depending on whether the agent is
infectious. CBO estimates that monoclonal antibodies would cost
$5,000 per treatment, and that Project Bioshield would acquire
enough to treat several hundred thousand people if qualified
products became available. The estimate assumes that, if other
types of qualified antivirals or antitoxins became available,
Project BioShield would acquire enough to treat 500,000 people,
at costs ranging from $2,000 to $5,000 per person for certain
intravenously-administered forms. Other countermeasures could
be less expensive on a per-person basis. For example, certain
antivirals or narrow-spectrum antibiotics in pill form could
cost about $100 per treatment, CBO estimates. Additionally, CBO
estimates that per-person costs would average $50 for Prussian
Blue, $100 for intravenous treatments for hydrogen cyanide, and
$300 per treatment for countermeasures for certain radiological
and nuclear agents. If Project BioShield acquired those types
of countermeasures, CBO assumes that the quantity procured
would be sufficient to respond to simultaneous events in
several large cities.
Under optimistic assumptions about when countermeasures for
the representative agents would become available, the cost of
acquiring, storing, and replacing all qualified countermeasures
for those agents could total $10 billion to $20 billion during
the 2004-2013 period. However, CBO assumes that research and
development efforts for some countermeasures will proceed
slowly or be unsuccessful, and that the Administration would
not acquire all products that could be designated as security
countermeasures.
Assuming appropriation of the authorized amount, CBO
estimates that discretionary spending to acquire and store
BioShield products would total $0.3 billion in 2004 and $5.5
billion over the 2004-2013 period. Acquisition costs would
comprise 70 percent to 80 percent of that amount, while
inventory management and replacement costs would make up the
balance.
CBO also estimates that implementing Project BioShield
would add to the administrative costs of HHS and DHS, both for
the contracting process and managing the stockpile. Funding for
those costs would come from appropriated funds. Based on
current spending for program support services for bioterrorism-
related activities (including the SNS) at the Centers for
Disease Control and Prevention, CBO estimates that
administrative costs would be about $10 million a year. Subject
to the appropriation of necessary amounts, CBO estimates that
discretionary spending for such costs would increase by $7
million in 2004 and $0.1 billion over the 2004-2013 period.
Research and development into qualified countermeasures
H.R. 2122 would authorize the Secretary of HHS to expedite
procurement and peer review for research related to qualified
countermeasures. The bill also would allow the Secretary to
secure the services of expects or consultants with relevant
expertise. Implementation of these measures could increase the
resources required by the agency, accelerate spending, or both.
CBO does not have sufficient information to estimate the
additional resources that might be required by the agency or
the rate at which spending might accelerate under the bill.
Such spending could come from appropriated funds.
Authorization for medical products for use in emergencies
The FDA's regulatory process allows for expedited approval
of security countermeasures under current law. Pursuant to the
Public Health Security and Bioterrorism Preparedness and
Response Act of 2002, the FDA may allow certain drugs, devices,
and bioligics defined as priority countermeasures to move more
quickly through the agency's regulatory process. To further
expedite the development of security countermeasures, the FDA
has implemented a rule that allows approval of certain drugs
based on tests in animals.
H.R. 2122 would allow the Secretary of HHS to authorize the
FDA to approve the use of certain drugs or devices for use
during periods designated as emergencies by the Secretary of
HHS, DHS, or Defense. The authorization would remain in effect
for no more than one year, unless the Secretary determines
otherwise based on the nature of the emergency. When the
Secretary authorizes the emergency use of a product that is an
unapproved use of an approved product, the bill would provide
some flexibility to manufacturers in carrying out activities
under the emergency use authorization.
Based on information from Administration officials, CBO
expects that implementing this provision in H.R. 2122 would not
increase costs to the FDA. Over the past year, the FDA has
hired about 100 people to review drug applications and provide
assistance to companies engaged in research and development
into security countermeasures. Thus, the agency already has the
infrastructure to handle the additional authority related to
the proposed emergency-use authorization and would not require
additional resources. Therefore, CBO estimates that this
provision of H.R. 2122 would have no budgetary effect.
Previous CBO estimates: S. 15, the Project BioShield Act of
2003, as reported by the Senate Committee on Health, Education,
Labor and Pensions on March 25, 2003, would amend the Public
Health Service Act (PHSA) to create permanent, indefinite
funding authority for the procurement of certain biomedical
countermeasures. In its cost estimate dated May 7, 2003, CBO
estimated that enacting S. 15 would increase direct spending by
$270 million in 2004 and $8.1 billion over the 2004-2013
period.
Although both H.R. 2122 and S. 15 would authorize programs
to procure countermeasures to protect the public health against
terrorism, H.R. 2122 would not have an effect on direct
spending; instead, the bill would authorize appropriations of
up to $5.6 billion over the 2004-2013 period. Estimated
spending under H.R. 2122 is less than under S. 15 because the
House bill would authorize a set amount of appropriations,
whereas the Senate bill would provide unlimited direct spending
authority.
In several areas, H.R. 2122 would allow the Secretary more
flexibility in terms of what products could be procured and how
contracts would be structured. H.R. 2122 would allow the
procurement of countermeasures even if they have a significant
commercial application, while S. 15 would restrict the
procurement authority to those without such application. While
S. 15 would require the Secretary to determine that a
countermeasure is likely to be approved by the FDA within five
years as a condition of procurement, H.R. 2122 would require
only that the Secretary consider whether a five-year limit is
feasible. H.R. 2122 would provide additional flexibility in
contracting by permitting the Secretary to extend first-time
contracts to eight years (versus five in S. 15) and would allow
the Secretary discretion to provide a 10 percent advance to
companies developing new products. Those provisions would
accelerate spending relative to S. 15.
On June 6, 2003, CBO transmitted a cost estimate for H.R.
2122 as ordered reported by the House Committee on Energy and
Commerce on May 15, 2003. That version of H.R. 2122 is nearly
identical to the version of H.R. 2122 approved by the Committee
on Government Reform. CBO's estimates of the costs of the two
versions of H.R. 2122 are identical.
Intergovernmental and private-sector impact: H.R. 2122
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments.
Estimate prepared by: Federal costs: Jeanne De Sa and Sam
Papenfuss; impact on state, local, and tribal governments: Leo
Lex; Impact on the private sector: Samuel Kina.
Estimate approved by: Robert A. Sunshine, Assistant
Director for Budget Analysis.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
PUBLIC HEALTH SERVICE ACT
* * * * * * *
TITLE III--GENERAL POWERS AND DUTIES OF PUBLIC HEALTH SERVICE
* * * * * * *
Part B--Federal-State Cooperation
* * * * * * *
SEC. 319F-1. AUTHORITY FOR USE OF CERTAIN PROCEDURES REGARDING
BIOMEDICAL COUNTERMEASURE RESEARCH AND DEVELOPMENT
ACTIVITIES.
(a) In General.--
(1) Authority.--In conducting and supporting research
and development activities regarding biomedical
countermeasures under section 319F(h), the Secretary
may conduct and support such activities in accordance
with this section if the activities concern qualified
countermeasures.
(2) Qualified countermeasure.--For purposes of this
section, the term ``qualified countermeasure'' means a
priority countermeasure (as defined in section 319F(h))
that affects national security.
(3) Interagency cooperation.--
(A) In general.--In carrying out activities
under this section, the Secretary is
authorized, subject to subparagraph (B), to
enter into interagency agreements and other
collaborative undertakings with other agencies
of the United States Government.
(B) Limitation.--An agreement or undertaking
under this paragraph shall not authorize
another agency to exercise the authorities
provided by this section.
(4) Availability of facilities to the secretary.--In
any grant or cooperative agreement entered into under
the authority provided in this section with respect to
a biocontainment laboratory or other related or
ancillary specialized research facility that the
Secretary determines necessary for the purpose of
performing, administering, and supporting qualified
countermeasure research and development, the Secretary
may provide that the facility that is the object of
such grant or cooperative agreement shall be available
as needed to the Secretary to respond to public health
emergencies affecting national security.
(b) Expedited Procurement Authority.--
(1) Increased simplified acquisition threshold for
biomedical countermeasure procurements.--
(A) In general.--For any procurement by the
Secretary of property or services for use (as
determined by the Secretary) in performing,
administering, or supporting qualified
countermeasure research or development
activities under this section that the
Secretary determines necessary to respond to
pressing research and development needs under
this section, the amount specified in section
4(11) of the Office of Federal Procurement
Policy Act (41 U.S.C. 403(11)), as applicable
pursuant to section 302A(a) of the Federal
Property and Administrative Services Act of
1949 (41 U.S.C. 252a(a)), shall be deemed to be
$25,000,000 in the administration, with respect
to such procurement, of--
(i) section 303(g)(1)(A) of the
Federal Property and Administrative
Services Act of 1949 (41 U.S.C.
253(g)(1)(A)) and its implementing
regulations; and
(ii) section 302A(b) of such Act (41
U.S.C. 252a(b)) and its implementing
regulations.
(B) Application of certain provisions.--
Notwithstanding subparagraph (A) and the
provision of law and regulations referred to in
such subparagraph, each of the following
provisions shall apply to procurements
described in this paragraph to the same extent
that such provisions would apply to such
procurements in the absence of subparagraph
(A):
(i) Chapter 37 of title 40, United
States Code (relating to contract work
hours and safety standards).
(ii) Subsections (a) and (b) of
section 7 of the Anti-Kickback Act of
1986 (41 U.S.C. 57(a) and (b)).
(iii) Section 304C of the Federal
Property and Administrative Services
Act of 1949 (41 U.S.C. 254d) (relating
to the examination of contractor
records).
(C) Internal controls to be instituted.--The
Secretary shall institute appropriate internal
controls for procurements that are under this
paragraph, including requirements with regard
to documenting the justification for use of the
authority in this paragraph.
(2) Other than full and open competition.--(A) In
using the authority provided in section 303(c)(1) of
title III of the Federal Property and Administrative
Services Act of 1949 (41 U.S.C. 253(c)(1)) to use
procedures other than competitive procedures in the
case of a procurement described in paragraph (1) of
this subsection, the phrase ``available from only one
responsible source'' in such section 303(c)(1) shall be
deemed to mean ``available from only one responsible
source or only from a limited number of responsible
sources''.
(B) The authority under subparagraph (A) is in
addition to any other authority to use procedures other
than competitive procedures.
(C) The Secretary shall implement this paragraph in
accordance with applicable government-wide regulations,
including requirements that offers be solicited from as
many potential sources as is practicable under the
circumstances, that required notices be published, and
that submitted offers be considered.
(3) Increased micropurchase threshold.--
(A) In general.--For a procurement described
by paragraph (1), the amount specified in
subsections (c), (d), and (f) of section 32 of
the Office of Federal Procurement Policy Act
(41 U.S.C. 428) shall be deemed to be $15,000
in the administration of that section with
respect to such procurement.
(B) Internal controls to be instituted.--The
Secretary shall institute appropriate internal
controls for purchases that are under this
paragraph and that are greater than $2,500.
(C) Exception to preference for purchase card
mechanism.--No provision of law establishing a
preference for using a Government purchase card
method for purchases shall apply to purchases
that are under this paragraph and that are
greater than $2,500.
(c) Authority To Expedite Peer Review.--
(1) In general.--The Secretary may, as the Secretary
determines necessary to respond to pressing qualified
countermeasure research and development needs under
this section, employ such expedited peer review
procedures (including consultation with appropriate
scientific experts) as the Secretary, in consultation
with the Director of NIH, deems appropriate to obtain
assessment of scientific and technical merit and likely
contribution to the field of qualified countermeasure
research, in place of the peer review and advisory
council review procedures that would be required under
sections 301(a)(3), 405(b)(1)(B), 405(b)(2),
406(a)(3)(A), 492, and 494, as applicable to a grant,
contract, or cooperative agreement--
(A) that is for performing, administering, or
supporting qualified countermeasure research
and development activities; and
(B) the amount of which is not greater than
$1,500,000.
(2) Subsequent phases of research.--The Secretary's
determination of whether to employ expedited peer
review with respect to subsequent phases of a research
grant or cooperative agreement under this section shall
be determined without regard to the peer review
procedures used for any prior peer review of that same
grant or cooperative agreement.
(d) Authority for Personal Services Contracts.--
(1) In general.--For the purpose of performing,
administering, and supporting qualified countermeasure
research and development activities, the Secretary may,
as the Secretary determines necessary to respond to
pressing qualified countermeasure research and
development needs under this section, obtain by
contract (in accordance with section 3109 of title 5,
United States Code, but without regard to the
limitations in such section on the period of service
and on pay) the personal services of experts or
consultants who have scientific or other professional
qualifications, except that in no case shall the
compensation provided to any such expert or consultant
exceed the daily equivalent of the annual rate of
compensation for the President.
(2) Federal tort claims act coverage.--
(A) In general.--A person carrying out a
contract under paragraph (1), and an officer,
employee, or governing board member of such
person, shall be deemed to be an employee of
the Department of Health and Human Services for
purposes of claims under sections 1346(b) and
2672 of title 28, United States Code, for money
damages for personal injury, including death,
resulting from performance of functions under
such contract.
(B) Exclusivity of remedy.--The remedy
provided by subparagraph (A) shall be exclusive
of any other civil action or proceeding by
reason of the same subject matter against the
person, officer, employee, or governing board
member.
(3) Internal controls to be instituted.--
(A) In general.--The Secretary shall
institute appropriate internal controls for
contracts under this subsection, including
procedures for the Secretary to make a
determination of whether a person, or an
officer, employee, or governing board member of
a person, is deemed to be an employee of the
Department of Health and Human Services
pursuant to paragraph (2).
(B) Determination of employee status to be
final.--A determination by the Secretary under
subparagraph (A) that a person, or an officer,
employee, or governing board member of a
person, is or is not deemed to be an employee
of the Department of Health and Human Services
shall be final and binding on the Secretary and
the Attorney General and other parties to any
civil action or proceeding.
(4) Number of personal services contracts limited.--
The number of experts and consultants whose personal
services are obtained under paragraph (1) shall not
exceed 30 at any time.
(e) Streamlined Personnel Authority.--
(1) In general.--In addition to any other personnel
authorities, the Secretary may, as the Secretary
determines necessary to respond to pressing qualified
countermeasure research and development needs under
this section, without regard to such provisions of
title 5, United States Code, governing appointments in
the competitive service, and without regard to the
provisions of chapter 51 and subchapter III of chapter
53 of such title relating to classification and General
Schedule pay rates, appoint professional and technical
employees, not to exceed 30 such employees at any time,
to positions in the National Institutes of Health to
perform, administer, or support qualified
countermeasure research and development activities in
carrying out this section.
(2) Internal controls to be instituted.--The
Secretary shall institute appropriate internal controls
for appointments under this subsection.
(f) Actions Committed to Agency Discretion.--Actions by the
Secretary under the authority of this section are committed to
agency discretion.
(g) Effect on Right To File Protest.--Nothing in this section
shall affect the right of an interested party to file a protest
with the contracting agency, to file a protest with the
Comptroller General under subchapter V of chapter 35 of title
31, United States Code, or to file an action in the United
States Court of Federal Claims under section 1491(b) of title
28, United States Code.
SEC. 319F-2. STRATEGIC NATIONAL STOCKPILE.
(a) Strategic National Stockpile.--
(1) In general.--The Secretary of Homeland Security
(referred to in this section as the ``Homeland Security
Secretary''), in coordination with the Secretary and
the Secretary of Veterans Affairs, shall maintain a
stockpile or stockpiles of drugs, vaccines and other
biological products, medical devices, and other
supplies in such numbers, types, and amounts as are
determined by the Secretary to be appropriate and
practicable, taking into account other available
sources, to provide for the emergency health security
of the United States, including the emergency health
security of children and other vulnerable populations,
in the event of a bioterrorist attack or other public
health emergency.
(2) Procedures.--The Secretary, in managing the
stockpile under paragraph (1), shall--
(A) consult with the working group under
section 319F(a);
(B) ensure that adequate procedures are
followed with respect to such stockpile for
inventory management and accounting, and for
the physical security of the stockpile;
(C) in consultation with Federal, State, and
local officials, take into consideration the
timing and location of special events;
(D) review and revise, as appropriate, the
contents of the stockpile on a regular basis to
ensure that emerging threats, advanced
technologies, and new countermeasures are
adequately considered;
(E) devise plans for the effective and timely
supply-chain management of the stockpile, in
consultation with appropriate Federal, State
and local agencies, and the public and private
health care infrastructure; and
(F) ensure the adequate physical security of
the stockpile.
(b) Smallpox Vaccine Development.--
(1) In general.--The Secretary shall award contracts,
enter into cooperative agreements, or carry out such
other activities as may reasonably be required in order
to ensure that the stockpile under subsection (a)
includes an amount of vaccine against smallpox as
determined by such Secretary to be sufficient to meet
the health security needs of the United States.
(2) Rule of construction.--Nothing in this section
shall be construed to limit the private distribution,
purchase, or sale of vaccines from sources other than
the stockpile described in subsection (a).
(c) Additional Authority Regarding Procurement of Certain
Biomedical Countermeasures; Availability of Special Reserve
Fund.--
(1) In general.--
(A) Use of fund.--A security countermeasure
may, in accordance with this subsection, be
procured with amounts in the special reserve
fund under paragraph (10).
(B) Security countermeasure.--For purposes of
this subsection, the term ``security
countermeasure'' means a priority
countermeasure (as defined in section
319F(h))--
(i) that affects national security;
(ii) that is determined under
paragraph (2)(B)(ii) to be a necessary
countermeasure; and
(iii)(I) that is approved or cleared
under chapter V of the Federal Food,
Drug, and Cosmetic Act, or licensed
under section 351 of this Act, for use
as a countermeasure to a chemical,
biological, radiological, or nuclear
agent identified as a material threat
under paragraph (2)(A)(ii); or
(II) for which the Secretary
determines that sufficient and
satisfactory clinical experience or
research data (including data, if
available, from pre-clinical and
clinical trials) support a reasonable
conclusion that the countermeasure will
qualify for approval or licensing after
the date of a determination under
paragraph (5).
(2) Determination of material threats.--
(A) Material threat.--The Homeland Security
Secretary, in consultation with the heads of
other agencies as appropriate, shall on an
ongoing basis--
(i) assess current and emerging
threats of chemical, biological,
radiological, and nuclear agents; and
(ii) determine which of such agents
present a material threat against the
United States population.
(B) Public health impact; necessary
countermeasures.--The Secretary shall on an
ongoing basis--
(i) assess the potential public
health consequences of use against the
United States population of agents
identified under subparagraph (A)(ii);
and
(ii) determine, on the basis of such
assessment, the agents for which
priority countermeasures are necessary
to protect the public health from a
material threat.
(3) Assessment of availability and appropriateness of
countermeasures.--The Secretary, in consultation with
the Homeland Security Secretary, shall assess on an
ongoing basis the availability and appropriateness of
specific countermeasures to address specific threats
identified under paragraph (2).
(4) Call for security countermeasures; commitment for
recommendation for procurement.--
(A) Proposal to the president.--If, pursuant
to an assessment under paragraph (3), the
Homeland Security Secretary and the Secretary
make a determination that a security
countermeasure would be appropriate, such
Secretaries may jointly submit to the President
a proposal to--
(i) issue a call for the development
of such security countermeasure; and
(ii) make a commitment that, upon the
first development of such security
countermeasure that meets the
conditions for procurement under
paragraph (5), the Secretaries will,
based in part on information obtained
pursuant to such call, make a
recommendation under paragraph (6) that
the special reserve fund under
paragraph (10) be made available for
the procurement of such security
countermeasure.
(B) Countermeasure specifications.--The
Homeland Security Secretary and the Secretary
shall, to the extent practicable, include in
the proposal under subparagraph (A)--
(i) estimated quantity of purchase
(in the form of number of doses or
number of effective courses of
treatments regardless of dosage form);
(ii) necessary measures of minimum
safety and effectiveness;
(iii) estimated price for each dose
or effective course of treatment
regardless of dosage form; and
(iv) other information that may be
necessary to encourage and facilitate
research, development, and manufacture
of the countermeasure or to provide
specifications for the countermeasure.
(C) Presidential approval.--If the President
approves a proposal under subparagraph (A), the
Homeland Security Secretary and the Secretary
shall make known to persons who may respond to
a call for the security countermeasure
involved--
(i) the call for the countermeasure;
(ii) specifications for the
countermeasure under subparagraph (B);
and
(iii) a commitment described in
subparagraph (A)(ii).
(5) Secretary's determination of countermeasures
appropriate for funding from special reserve fund.--
(A) In general.--The Secretary, in accordance
with the provisions of this paragraph, shall
identify specific security countermeasures that
the Secretary determines, in consultation with
the Homeland Security Secretary, to be
appropriate for inclusion in the stockpile
under subsection (a) pursuant to procurements
made with amounts in the special reserve fund
under paragraph (10) (referred to in this
subsection individually as a ``procurement
under this subsection'').
(B) Requirements.--In making a determination
under subparagraph (A) with respect to a
security countermeasure, the Secretary shall
determine and consider the following:
(i) The quantities of the product
that will be needed to meet the needs
of the stockpile.
(ii) The feasibility of production
and delivery within five years of
sufficient quantities of the product.
(iii) Whether there is a lack of a
significant commercial market for the
product at the time of procurement,
other than as a security
countermeasure.
(6) Recommendation for president's approval.--
(A) Recommendation for procurement.--In the
case of a security countermeasure that the
Secretary has, in accordance with paragraphs
(2), (3), and (5), determined to be appropriate
for procurement under this subsection, the
Homeland Security Secretary and the Secretary
shall jointly submit to the President, in
coordination with the Director of the Office of
Management and Budget, a recommendation that
the special reserve fund under paragraph (10)
be made available for the procurement of such
countermeasure.
(B) Presidential approval.--The special
reserve fund under paragraph (10) is available
for a procurement of a security countermeasure
only if the President has approved a
recommendation under subparagraph (A) regarding
the countermeasure.
(C) Notice to congress.--The Secretary and
the Homeland Security Secretary shall notify
the Congress of each decision of the President
to approve a recommendation under subparagraph
(A). Such notice shall include an explanation
of the decision to make available the special
reserve fund under paragraph (10) for
procurement of such a countermeasure,
including, where available, the identification
of the potential supplier or suppliers of such
countermeasure, and whether other potential
suppliers of the same or similar
countermeasures were considered and rejected
for procurement under this section and the
reasons therefor.
(D) Subsequent specific countermeasures.--
Procurement under this subsection of a security
countermeasure for a particular purpose does
not preclude the subsequent procurement under
this subsection of any other security
countermeasure for such purpose if the
Secretary has determined under paragraph (5)(A)
that such countermeasure is appropriate for
inclusion in the stockpile and if, as
determined by the Secretary, such
countermeasure provides improved safety or
effectiveness, or for other reasons enhances
preparedness to respond to threats of use of a
biological, chemical, radiological, or nuclear
agent. Such a determination by the Secretary is
committed to agency discretion.
(E) Rule of construction.--Recommendations
and approvals under this paragraph apply solely
to determinations that the special reserve fund
under paragraph (10) will be made available for
a procurement of a security countermeasure, and
not to the substance of contracts for such
procurement or other matters relating to awards
of such contracts.
(7) Procurement.--
(A) In general.--For purposes of a
procurement under this subsection that is
approved by the President under paragraph (6),
the Homeland Security Secretary and the
Secretary shall have responsibilities in
accordance with subparagraphs (B) and (C).
(B) Interagency agreements.--
(i) For procurement.--The Homeland
Security Secretary shall enter into an
agreement with the Secretary for
procurement of a security
countermeasure in accordance with the
provisions of this paragraph. The
special reserve fund under paragraph
(10) shall be available for the
Secretary's costs of such procurement,
other than as provided in clause (ii).
(ii) For administrative costs.--The
agreement entered into between the
Homeland Security Secretary and the
Secretary for managing the stockpile
under subsection (a) shall provide for
reimbursement of the Secretary's
administrative costs relating to
procurements under this subsection.
(C) Procurement.--
(i) In general.--The Secretary shall
be responsible for--
(I) arranging for procurement
of a security countermeasure,
including negotiating terms
(including quantity, production
schedule, and price) of, and
entering into, contracts and
cooperative agreements, and for
carrying out such other
activities as may reasonably be
required, in accordance with
the provisions of this
subparagraph; and
(II) promulgating regulations
to implement clauses (v), (vi),
and (vii), and any other
provisions of this subsection.
(ii) Contract terms.--A contract for
procurements under this subsection
shall (or, as specified below, may)
include the following terms:
(I) Payment conditioned on
substantial delivery.--The
contract shall provide that no
payment may be made until
delivery has been made of a
substantial portion (as
determined by the Secretary) of
the total number of units
contracted for, except that,
notwithstanding any other
provision of law, the contract
may provide that, if the
Secretary determines (in the
Secretary's discretion) that an
advance payment is necessary to
ensure success of a project,
the Secretary may pay an
amount, not to exceed 10
percent of the contract amount,
in advance of delivery. The
contract shall provide that
such advance payment is
required to be repaid if there
is a failure to perform under
the contract, except in special
circumstances as determined by
the Secretary on a contract by
contract basis.
(II) Contract duration.--The
contract shall be for a period
not to exceed five years,
except that, in first awarding
the contract, the Secretary may
provide for a longer duration,
not exceeding eight years, if
the Secretary determines that
complexities or other
difficulties in performance
under the contract justify such
a period. The contract shall be
renewable for additional
periods, none of which shall
exceed five years.
(III) Storage by vendor.--The
contract may provide that the
vendor will provide storage for
stocks of a product delivered
to the ownership of the Federal
Government under the contract,
for such period and under such
terms and conditions as the
Secretary may specify, and in
such case amounts from the
special reserve fund under
paragraph (10) shall be
available for costs of
shipping, handling, storage,
and related costs for such
product.
(iii) Availability of simplified
acquisition procedures.--
(I) In general.--If the
Secretary determines that there
is a pressing need for a
procurement of a specific
countermeasure, the amount of
the procurement under this
subsection shall be deemed to
be below the threshold amount
specified in section 4(11) of
the Office of Federal
Procurement Policy Act (41
U.S.C. 403(11)), for purposes
of application to such
procurement, pursuant to
section 302A(a) of the Federal
Property and Administrative
Services Act of 1949 (41 U.S.C.
252a(a)), of--
(aa) section
303(g)(1)(A) of the
Federal Property and
Administrative Services
Act of 1949 (41 U.S.C.
253(g)(1)(A)) and its
implementing
regulations; and
(bb) section 302A(b)
of such Act (41 U.S.C.
252a(b)) and its
implementing
regulations.
(II) Application of certain
provisions.--Notwithstanding
subclause (I) and the provision
of law and regulations referred
to in such clause, each of the
following provisions shall
apply to procurements described
in this clause to the same
extent that such provisions
would apply to such
procurements in the absence of
subclause (I):
(aa) Chapter 37 of
title 40, United States
Code (relating to
contract work hours and
safety standards).
(bb) Subsections (a)
and (b) of section 7 of
the Anti-Kickback Act
of 1986 (41 U.S.C.
57(a) and (b)).
(cc) Section 304C of
the Federal Property
and Administrative
Services Act of 1949
(41 U.S.C. 254d)
(relating to the
examination of
contractor records).
(iv) Other than full and open
competition.--(I) In using the
authority provided in section 303(c)(1)
of title III of the Federal Property
and Administrative Services Act of 1949
(41 U.S.C. 253(c)(1)) to use procedures
other than competitive procedures in
the case of a procurement under this
subsection, the phrase ``available from
only one responsible source'' in such
section 303(c)(1) shall be deemed to
mean ``available from only one
responsible source or only from a
limited number of responsible
sources''.
(II) The authority under subclause
(I) is in addition to any other
authority to use procedures other than
competitive procedures.
(III) The Secretary shall implement
this clause in accordance with
applicable government-wide regulations,
including requirements that offers be
solicited from as many potential
sources as is practicable under the
circumstances, that required notices be
published, and that submitted offers be
considered.
(v) Premium provision in multiple
award contracts.--
(I) In general.--If, under
this subsection, the Secretary
enters into contracts with more
than one vendor to procure a
security countermeasure, such
Secretary may, notwithstanding
any other provision of law,
include in each of such
contracts a provision that--
(aa) identifies an
increment of the total
quantity of security
countermeasure
required, whether by
percentage or by
numbers of units; and
(bb) promises to pay
one or more specified
premiums based on the
priority of such
vendors' production and
delivery of the
increment identified
under item (aa), in
accordance with the
terms and conditions of
the contract.
(II) Determination of
government's requirement not
reviewable.--If the Secretary
includes in each of a set of
contracts a provision as
described in subclause (I),
such Secretary's determination
of the total quantity of
security countermeasure
required, and any amendment of
such determination, is
committed to agency discretion.
(vi) Extension of closing date for
receipt of proposals not reviewable.--A
decision by the Secretary to extend the
closing date for receipt of proposals
for a procurement under this subsection
is committed to agency discretion.
(vii) Limiting competition to sources
responding to request for
information.--In conducting a
procurement under this subsection, the
Secretary may exclude a source that has
not responded to a request for
information under section 303A(a)(1)(B)
of the Federal Property and
Administrative Services Act of 1949 (41
U.S.C. 253a(a)(1)(B)) if such request
has given notice that the Secretary may
so exclude such a source.
(8) Interagency cooperation.--
(A) In general.--In carrying out activities
under this section, the Homeland Security
Secretary and the Secretary are authorized,
subject to subparagraph (B), to enter into
interagency agreements and other collaborative
undertakings with other agencies of the United
States Government.
(B) Limitation.--An agreement or undertaking
under this paragraph shall not authorize
another agency to exercise the authorities
provided by this section to the Homeland
Security Secretary or to the Secretary.
(9) Restrictions on use of funds.--Amounts in the
special reserve fund under paragraph (10) shall not be
used to pay--
(A) costs for the purchase of vaccines under
procurement contracts entered into before the
date of the enactment of the Project BioShield
Act of 2003; or
(B) administrative costs.
(10) Special reserve fund.--For purposes of this
subsection, the term ``special reserve fund'' has the
meaning given such term in section 510 of the Homeland
Security Act of 2002.
(d) Disclosures.--No Federal agency shall disclose under
section 552, United States Code, any information identifying
the location at which materials in the stockpile under
subsection (a) are stored.
(e) Definition.--For purposes of subsection (a), the term
``stockpile'' includes--
(1) a physical accumulation (at one or more
locations) of the supplies described in subsection (a);
or
(2) a contractual agreement between the Homeland
Security Secretary and a vendor or vendors under which
such vendor or vendors agree to provide to such
Secretary supplies described in subsection (a).
(f) Authorization of Appropriations.--
(1) Strategic national stockpile.--For the purpose of
carrying out subsection (a), there are authorized to be
appropriated $640,000,000 for fiscal year 2002, and
such sums as may be necessary for each of fiscal years
2003 through 2006. Such authorization is in addition to
amounts in the special reserve fund under subsection
(c)(10).
(2) Smallpox vaccine development.--For the purpose of
carrying out subsection (b), there are authorized to be
appropriated $509,000,000 for fiscal year 2002, and
such sums as may be necessary for each of fiscal years
2003 through 2006.
TITLE IV--NATIONAL RESEARCH INSTITUTES
* * * * * * *
Part E--Other Agencies of NIH
* * * * * * *
SEC. 481A. BIOMEDICAL AND BEHAVIORAL RESEARCH FACILITIES.
(a) Modernization and Construction of Facilities.--
(1) In general.--The Director of NIH, acting through
the Director of the Center or the Director of the
National Institute of Allergy and Infectious Diseases,
may make grants or contracts to public and nonprofit
private entities to expand, remodel, renovate, or alter
existing research facilities or construct new research
facilities, subject to the provisions of this section.
* * * * * * *
(c) Requirements for Grants.--
(1) In general.--The Director of the Center or the
Director of the National Institute of Allergy and
Infectious Diseases may make a grant under subsection
(a) only if the applicant for the grant meets the
following conditions:
(A) * * *
* * * * * * *
(2) Institutions of emerging excellence.--From the
amount appropriated under [subsection (i)] subsection
(i)(1) for a fiscal year up to $50,000,000, the
Director of the Center shall make available 25 percent
of such amount, and from the amount appropriated under
such subsection for a fiscal year that is over
$50,000,000, the Director of the Center shall make
available up to 25 percent of such amount, for grants
under subsection (a) to applicants that in addition to
meeting the requirements established in paragraph (1),
have demonstrated emerging excellence in biomedical or
behavioral research, as follows:
(A) * * *
* * * * * * *
(d) Requirement of Application.--The Director of the Center
or the Director of the National Institute of Allergy and
Infectious Diseases may make a grant under subsection (a) only
if an application for the grant is submitted to the Director
and the application is in such form, is made in such manner,
and contains such agreements, assurances, and information as
the Director determines to be necessary to carry out this
section.
(e) Amount of Grant; Payments.--
(1) Amount.--The amount of any grant awarded under
subsection (a) shall be determined by the Director of
the Center or the Director of the National Institute of
Allergy and Infectious Diseases, except that such
amount shall not exceed--
(A) 50 percent (or, in the case of the
Institute, 75 percent) of the necessary cost of
the construction of a proposed facility as
determined by the Director; or
(B) in the case of a multipurpose facility,
40 percent (or, in the case of the Institute,
75 percent) of that part of the necessary cost
of construction that the Director determines to
be proportionate to the contemplated use of the
facility.
(2) Reservation of amounts.--On the approval of any
application for a grant under subsection (a), the
Director of the Center or the Director of the National
Institute of Allergy and Infectious Diseases shall
reserve, from any appropriation available for such
grants, the amount of such grant, and shall pay such
amount, in advance or by way of reimbursement, and in
such installments consistent with the construction
progress, as the Director may determine appropriate.
The reservation of any amount by the Director under
this paragraph may be amended by the Director, either
on the approval of an amendment of the application or
on the revision of the estimated cost of construction
of the facility.
* * * * * * *
(4) Waiver of limitations.--The limitations imposed
under paragraph (1) may be waived at the discretion of
the Director of the Center or the Director of the
National Institute of Allergy and Infectious Diseases
for applicants meeting the conditions described in
subsection (c).
(f ) Recapture of Payments.--If, not later than 20 years
after the completion of construction for which a grant has been
awarded under subsection (a)--
(1) in the case of an award by the Director of the
Center, the applicant or other owner of the facility
shall cease to be a public or non profit private
entity; or
(2) the facility shall cease to be used for the
research purposes for which it was constructed (unless
the Director of the Center or the Director of the
National Institute of Allergy and Infectious Diseases
determines, in accordance with regulations, that there
is good cause for releasing the applicant or other
owner from obligation to do so),
the United States shall be entitled to recover from the
applicant or other owner of the facility the amount bearing the
same ratio to the current value (as determined by an agreement
between the parties or by action brought in the United States
District Court for the district in which such facility is
situated) of the facility as the amount of the Federal
participation bore to the cost of the construction of such
facility.
* * * * * * *
(i) Authorization of [Appropriations.--For the purpose of
carrying out this section,] Appropriations.--
(1) Center.--For the purpose of carrying out this
section with respect to the Center, there are
authorized to be appropriated $250,000,000 for fiscal
year 2001, and such sums as may be necessary for each
of the fiscal years 2002 and 2003.
(2) National institute of allergy and infectious
diseases.--For the purpose of carrying out this section
with respect to the National Institute of Allergy and
Infectious Diseases, there are authorized to be
appropriated such sums as may be necessary for fiscal
year 2003.
----------
SECTION 510 OF THE HOMELAND SECURITY ACT OF 2002
SEC. 510. PROCUREMENT OF SECURITY COUNTERMEASURES FOR STRATEGIC
NATIONAL STOCKPILE.
(a) Authorization of Appropriations.--For procurement of
security countermeasures under section 319F-2(c) of the Public
Health Service Act (referred to in this section as the
``security countermeasures program''), there is authorized to
be appropriated up to $5,593,000,000 for the fiscal years 2004
through 2013. Of the amounts appropriated under the preceding
sentence, not to exceed $3,418,000,000 may be obligated during
the fiscal years 2004 through 2008, of which not to exceed
$890,000,000 may be obligated during fiscal year 2004.
(b) Special Reserve Fund.--For purposes of the security
countermeasures program, the term ``special reserve fund''
means the appropriations account established as a result of any
appropriations made under subsection (a).
(c) Availability.--
(1) Duration of availability for obligation.--Subject
to paragraph (2), all amounts appropriated under
subsection (a) are available for obligation through the
end of fiscal year 2013, provided that any portion of
such amount that remains unobligated for such purposes
on the expiration of such term shall be returned to the
United States Treasury and shall not be available for
subsequent obligation for any purpose.
(2) Initial availability for particular
procurements.--Amounts appropriated under subsection
(a) become available for a procurement under the
security countermeasures program only upon the approval
by the President of such availability for the
procurement in accordance with paragraph (6)(B) of such
program.
----------
PUBLIC HEALTH SECURITY AND BIOTERRORISM PREPAREDNESS AND RESPONSE ACT
OF 2002
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) * * *
(b) Table of Contents.--The table of contents of the Act is
as follows:
Sec. 1. Short title; table of contents.
TITLE I--NATIONAL PREPAREDNESS FOR BIOTERRORISM AND OTHER PUBLIC HEALTH
EMERGENCIES
* * * * * * *
Subtitle B--Strategic National Stockpile; Development of Priority
Countermeasures
[Sec. 121. Strategic national stockpile.]
* * * * * * *
[SEC. 121. STRATEGIC NATIONAL STOCKPILE.
[(a) Strategic National Stockpile.--
[(1) In general.--The Secretary of Health and Human
Services (referred to in this section as the
``Secretary''), in coordination with the Secretary of
Veterans Affairs, shall maintain a stockpile or
stockpiles of drugs, vaccines and other biological
products, medical devices, and other supplies in such
numbers, types, and amounts as are determined by the
Secretary to be appropriate and practicable, taking
into account other available sources, to provide for
the emergency health security of the United States,
including the emergency health security of children and
other vulnerable populations, in the event of a
bioterrorist attack or other public health emergency.
[(2) Procedures.--The Secretary, in managing the
stockpile under paragraph (1), shall--
[(A) consult with the working group under
section 319F(a) of the Public Health Service
Act;
[(B) ensure that adequate procedures are
followed with respect to such stockpile for
inventory management and accounting, and for
the physical security of the stockpile;
[(C) in consultation with Federal, State, and
local officials, take into consideration the
timing and location of special events;
[(D) review and revise, as appropriate, the
contents of the stockpile on a regular basis to
ensure that emerging threats, advanced
technologies, and new countermeasures are
adequately considered;
[(E) devise plans for the effective and
timely supply-chain management of the
stockpile, in consultation with appropriate
Federal, State and local agencies, and the
public and private health care infrastructure;
and
[(F) ensure the adequate physical security of
the stockpile.
[(b) Smallpox Vaccine Development.--
[(1) In general.--The Secretary shall award
contracts, enter into cooperative agreements, or carry
out such other activities as may reasonably be required
in order to ensure that the stockpile under subsection
(a) includes an amount of vaccine against smallpox as
determined by the Secretary to be sufficient to meet
the health security needs of the United States.
[(2) Rule of construction.--Nothing in this section
shall be construed to limit the private distribution,
purchase, or sale of vaccines from sources other than
the stockpile described in subsection (a).
[(c) Disclosures.--No Federal agency shall disclose under
section 552, United States Code, any information identifying
the location at which materials in the stockpile under
subsection (a) are stored.
[(d) Definition.--For purposes of subsection (a), the term
``stockpile'' includes--
[(1) a physical accumulation (at one or more
locations) of the supplies described in subsection (a);
or
[(2) a contractual agreement between the Secretary
and a vendor or vendors under which such vendor or
vendors agree to provide to the Secretary supplies
described in subsection (a).
[(e) Authorization of Appropriations.--
[(1) Strategic national stockpile.--For the purpose
of carrying out subsection (a), there are authorized to
be appropriated $640,000,000 for fiscal year 2002, and
such sums as may be necessary for each of fiscal years
2003 through 2006.
[(2) Smallpox vaccine development.--For the purpose
of carrying out subsection (b), there are authorized to
be appropriated $509,000,000 for fiscal year 2002, and
such sums as may be necessary for each of fiscal years
2003 through 2006.]
----------
SECTION 564 OF THE FEDERAL FOOD, DRUG, AND COSMETIC ACT
SEC. 564. AUTHORIZATION FOR MEDICAL PRODUCTS FOR USE IN EMERGENCIES.
(a) In General.--
(1) Emergency uses.--Notwithstanding sections 505,
510(k), and 515 of this Act and section 351 of the
Public Health Service Act, and subject to the
provisions of this section, the Secretary may authorize
the introduction into interstate commerce, during the
effective period of a declaration under subsection (b),
of a drug or device intended for use in an actual or
potential emergency (referred to in this section as an
``emergency use'').
(2) Approval status of product.--An authorization
under paragraph (1) may authorize an emergency use of a
product that--
(A) is not approved, licensed, or cleared for
commercial distribution under a provision of
law referred to in such paragraph (referred to
in this section as an ``unapproved product'');
or
(B) is approved, licensed, or cleared under
such a provision, but which use is not under
such provision an approved, licensed, or
cleared use of the product (referred to in this
section as an ``unapproved use of an approved
product'').
(3) Relation to other uses.--An emergency use
authorized under paragraph (1) for a product is in
addition to any other use that is authorized for the
product under a provision of law referred to in such
paragraph.
(4) Definitions.--For purposes of this section:
(A) The term ``emergency use'' has the
meaning indicated for such term in paragraph
(1).
(B) The term ``product'' means a drug or
device.
(C) The term ``unapproved product'' has the
meaning indicated for such term in paragraph
(2)(A).
(D) The term ``unapproved use of an approved
product'' has the meaning indicated for such
term in paragraph (2)(B).
(b) Declaration of Emergency.--
(1) In general.--The Secretary may declare an
emergency justifying the authorization under this
subsection for a product on the basis of--
(A) a determination by the Secretary of
Homeland Security that there is a national
emergency, or a significant potential for a
national emergency, involving a heightened risk
of attack with a specified biological,
chemical, radiological, or nuclear agent or
agents;
(B) a determination by the Secretary of
Defense that there is a military emergency, or
a significant potential for a military
emergency, involving a heightened risk to
United States military forces of attack with a
biological, chemical, radiological, or nuclear
agent or agents; or
(C) a determination by the Secretary of a
public health emergency under section 319 of
the Public Health Service Act, affecting
national security and involving a specified
biological, chemical, radiological, or nuclear
agent or agents, or a specified disease or
condition that may be attributable to such
agent or agents.
(2) Termination of declaration.--
(A) In general.--A declaration under this
subsection shall terminate upon the earlier
of--
(i) a determination by the Secretary,
in consultation as appropriate with the
Secretary of Homeland Security or the
Secretary of Defense, that the
circumstances described in paragraph
(1) have ceased to exist; or
(ii) the expiration of the one-year
period beginning on the date on which
the declaration is made.
(B) Renewal.--Notwithstanding subparagraph
(A), the Secretary may renew a declaration
under this subsection, and this paragraph shall
apply to any such renewal.
(3) Advance notice of termination.--In terminating a
declaration under this section, the Secretary shall
provide advance notice that the declaration will be
terminated. The period of advance notice shall be a
period reasonably determined to provide--
(A) in the case of an unapproved product, a
sufficient period for disposition of shipments
of the product, including the return of such
shipments to the manufacturer (in the case of a
manufacturer that chooses to have the shipments
returned); and
(B) in the case of unapproved uses of
approved products, a sufficient period for the
disposition of any labeling that was provided
with respect to the emergency use involved.
(4) Publication.--The Secretary shall promptly
publish in the Federal Register each declaration,
determination, and renewal under this subsection.
(c) Criteria for Issuance of Authorization.--The Secretary
may issue an authorization under this section with respect to
the emergency use of a product only if, after consultation with
the Director of the National Institutes of Health and the
Director of the Centers for Disease Control and Prevention, to
the extent feasible and appropriate given the circumstances of
the emergency involved, the Secretary concludes--
(1) that an agent specified in a declaration under
subsection (b) can cause a serious or life-threatening
disease or condition;
(2) that, based on the totality of scientific
evidence available to the Secretary, including data
from adequate and well-controlled clinical trials, if
available, it is reasonable to believe that--
(A) the product may be effective in
detecting, diagnosing, treating, or
preventing--
(i) such disease or condition; or
(ii) a serious or life-threatening
disease or condition caused by a
product authorized under this section
or approved under this Act or the
Public Health Service Act, for
detecting, diagnosing, treating, or
preventing such a disease or condition
caused by such an agent; and
(B) the known and potential benefits of the
product, when used to detect, diagnose,
prevent, or treat such disease or condition,
outweigh the known and potential risks of the
product;
(3) that there is no adequate, approved, and
available alternative to the product for detecting,
diagnosing, preventing, or treating such disease or
condition; and
(4) that such other criteria as the Secretary may by
regulation prescribe are satisfied.
(d) Scope of Authorization.--
(1) In general.--An authorization of a product under
this section shall state--
(A) each disease or condition that the
product may be used to detect, diagnose,
prevent, or treat within the scope of the
authorization;
(B) the Secretary's conclusions, made under
subsection (c)(2)(B), that the known and
potential benefits of the product, when used to
detect, diagnose, prevent, or treat such
disease or condition, outweigh the known and
potential risks of the product; and
(C) the Secretary's conclusions, made under
subsection (c), concerning the safety and
potential effectiveness of the product in
detecting, diagnosing, preventing, or treating
such diseases or conditions, including an
assessment of the available scientific
evidence.
(2) Confidential information.--Nothing in this
section alters or amends section 1905 of title 18,
United States Code, or section 552(b)(4) of title 5 of
such Code.
(e) Conditions of Authorization.--
(1) Unapproved product.--
(A) Required conditions.--With respect to the
emergency use of an unapproved product, the
Secretary, to the extent feasible given the
circumstances of the emergency, shall, for
persons who choose to carry out one or more
activities for which the authorization is
issued, establish such conditions on an
authorization under this section as the
Secretary finds necessary or appropriate to
protect the public health, including the
following:
(i) Appropriate conditions designed
to ensure that, to the extent feasible
given the circumstances of the
emergency, health care professionals
administering the product are
informed--
(I) that the Secretary has
authorized the emergency use of
the product;
(II) of the significant known
and potential benefits and
risks of the emergency use of
the product, and of the extent
to which such benefits and
risks are unknown; and
(III) of the alternatives to
the product that are available,
and of their benefits and
risks.
(ii) Appropriate conditions designed
to ensure that, to the extent feasible
given the circumstances of the
emergency, individuals to whom the
product is administered are informed--
(I) that the Secretary has
authorized the emergency use of
the product;
(II) of the significant known
and potential benefits and
risks of such use, and of the
extent to which such benefits
and risks are unknown; and
(III) of the option to accept
or refuse administration of the
product, of the consequences,
if any, of refusing
administration of the product,
and of the alternatives to the
product that are available and
of their benefits and risks.
(iii) Appropriate conditions for the
monitoring and reporting of adverse
events associated with the emergency
use of the product.
(iv) For manufacturers of the
product, appropriate conditions
concerning recordkeeping and reporting,
including records access by the
Secretary, with respect to the
emergency use of the product.
(B) Authority for additional conditions.--
With respect to the emergency use of an
unapproved product, the Secretary, to the
extent feasible given the circumstances of the
emergency, may, for persons who choose to carry
out one or more activities for which the
authorization is issued, establish such
conditions on an authorization under this
section as the Secretary finds necessary or
appropriate to protect the public health,
including the following:
(i) Appropriate conditions on which
entities may distribute the product
with respect to the emergency use of
the product (including limitation to
distribution by government entities),
and on how distribution is to be
performed.
(ii) Appropriate conditions on who
may administer the product with respect
to the emergency use of the product,
and on the categories of individuals to
whom, and the circumstances under
which, the product may be administered
with respect to such use.
(iii) For persons other than
manufacturers of the product,
appropriate conditions concerning
recordkeeping and reporting, including
records access by the Secretary, with
respect to the emergency use of the
product.
(iv) With respect to the emergency
use of the product, waive or limit, to
the extent appropriate given the
circumstances of the emergency,
conditions regarding current good
manufacturing practice otherwise
applicable to the manufacture,
processing, packing, or holding of
products subject to regulation under
this Act, including such requirements
established in section 501.
(2) Unapproved use.--With respect to the emergency
use of a product that is an unapproved use of an
approved product:
(A) The Secretary may, for manufacturers of
the product who choose to carry out one or more
activities for which the authorization is
issued, establish any of the conditions
described in clauses (i) through (iv) of
paragraph (1)(A).
(B)(i) If the authorization under this
section regarding the emergency use authorizes
a change in the labeling of the product, but
the manufacturer of the product chooses not to
make such change, such authorization may not
authorize distributors of the product or any
other person to alter or obscure the labeling
provided by the manufacturer.
(ii) In the circumstances described in clause
(i), an authorization under this section
regarding the emergency use may, for persons
who do not manufacture the product and who
choose to act under this clause, authorize such
persons to provide information on the product
in addition to the labeling provided by the
manufacturer, subject to compliance with clause
(i). Such additional information shall not be
considered labeling for purposes of section
502.
(f) Duration of Authorization.--
(1) In general.--Except as provided in paragraph (2),
an authorization under this section shall be effective
until the earlier of the termination of the declaration
under subsection (b) or a revocation under subsection
(g).
(2) Continued use after end of effective period.--An
authorization shall continue to be effective for
continued use with respect to patients to whom it was
administered during the period described by paragraph
(1), to the extent found necessary by such patients'
attending physicians.
(g) Revocation of Authorization.--
(1) Review.--The Secretary shall periodically review
the circumstances and the appropriateness of an
authorization under this section.
(2) Revocation.--The Secretary may revoke an
authorization under this section if, in the Secretary's
unreviewable discretion, the criteria under subsection
(c) for issuance of such authorization are no longer
met.
(h) Publication.--The Secretary shall promptly publish in the
Federal Register a notice of each authorization, and each
termination or revocation of an authorization, and an
explanation of the reasons therefor, under this section.
(i) Actions Committed to Agency Discretion.--Actions under
the authority of this section by the Secretary, by the
Secretary of Defense, or by the Secretary of Homeland Security
are committed to agency discretion.
(j) Rules of Construction.--Nothing in this section shall be
construed to impair or otherwise affect--
(1) the authority of the President as Commander in
Chief of the Armed Forces of the United States under
article II, section 2 of the United States
Constitution;
(2) the authority of the Secretary of Defense with
respect to the Department of Defense, including the
armed forces, under other provisions of Federal law; or
(3) the authority of the Secretary under section
319F-2 to manage the stockpile under such section.
(k) Application to Members of Armed Forces.--
(1) Waiver of requirement relating to option to
refuse.--In the case of administration of a
countermeasure to members of the armed forces, a
requirement, under subsection (e)(1)(A)(ii)(III),
designed to ensure that individuals are informed of an
option to accept or refuse administration of a product,
may be waived by the President if the President
determines, in writing, that complying with such
requirement is not feasible, is contrary to the best
interests of the members affected, or is not in the
interests of national security.
(2) Provision of information to member of the armed
forces.--If the Secretary makes a determination that it
is not feasible for the information required by
subsection (e)(1)(A)(ii) to be provided to a member of
the armed forces prior to the administration of the
product, such information shall be provided to such
member of the armed forces (or next-of-kin in the case
of the death of a member) to whom the product was
administered as soon as possible, but not later than 30
days, after such administration. Information concerning
the administration of the product shall be recorded in
the medical record of the member.
(3) Effect on statute pertaining to investigational
new drugs.--In the case of an authorization based on a
determination by the Secretary of Defense under
subsection (b)(1)(B), section 1107 of title 10, United
States Code, shall not apply to use of a product that
is the subject of such authorization, within the scope
of such authorization and while such authorization is
effective.
(l) Relation to Other Provisions.--If a product is the
subject of an authorization under this section, the use of such
product within the scope of the authorization --
(1) shall not be subject to any requirements pursuant
to section 505(i) or 520(g); and
(2) shall not be subject to any requirements
otherwise applicable to clinical investigations
pursuant to other provisions of this Act.
(m) Discretion Regarding Use of Authorization.--Nothing in
this section provides the Secretary any authority to require
any person to carry out any activity that becomes lawful
pursuant to an authorization under this section, and no person
is required to inform the Secretary that the person will not be
carrying out such activity, except that a manufacturer of a
sole-source unapproved product authorized for emergency use
shall notify the Secretary within a reasonable period of time
after the issuance by the Secretary of such authorization if
such manufacturer does not intend to carry out an activity or
activities under the authorization. This section does not have
any legal effect on a person who does not carry out any
activity for which an authorization under this section is
issued, or who carries out such an activity pursuant to other
provisions of this Act or section 351 of the Public Health
Service Act.
(n) Enforcement.--A person who carries out an activity
pursuant to an authorization under this section, but who fails
to comply with applicable conditions under subsection (e), is
with respect to that act of noncompliance subject to the
provisions of law specified in subsection (a) and to the
enforcement of such provisions under section 301.