Pediatric Medical Device Safety and Improvement Act of 2007

Mr. President, I offered an amendment yesterday that a number of my colleagues have spoken on, both in favor and against. When I laid down the amendment yesterday, I did not speak on it, so I wish to take some time to describe what the amendment is, why it is important, and why those who have spoken against it are wrong.

Let me describe, first of all, what the amendment is about, and let me do it, if I might, by asking unanimous consent that I be allowed to show on the floor of the Senate two bottles of medicine.

Mr. President, these two bottles of medicine contain Lipitor. Most people know about Lipitor. It is a cholesterol-lowering drug. This particular prescription drug is produced in Ireland, and it is sent from that production point, in a plant, by the way, that is approved by our Food and Drug Administration. We inspect that plant, as we do others. So they produce an FDA-approved drug--this drug has been approved--in a plant in Ireland that has been inspected by the FDA. These two bottles of medicine containing Lipitor, 20 milligrams, identical bottles with a difference in color, are sent to two different places in this case but sent to many places around the world. This one is sent to the United States to be sold to consumers in the United States that want to lower their cholesterol. This one is sent to consumers in Canada for those Canadians who wish to take Lipitor to lower their cholesterol.

There is a difference. Oh, not in the medicine, not in the bottle, and not in the instruction. What is the difference? The American consumer is told: You have to pay twice as much. Let me say that again. The difference is the price. The Canadian consumer is told: You pay half the price. The American consumer is told: You pay double the price.

Now, I use the Lipitor as an example only to describe a very significant problem. We have price controls on prescription drugs in this country. Those price controls are not established by the Government. They are not established by the Congress. These price controls are imposed by the pharmaceutical industry.

I have a problem with the pharmaceutical industry saying to the American consumer: We have a deal for you; we want you to pay the highest prices in the world for prescription drugs. We are going to sell them all over the world: Italy, Japan, Germany, France, China. We are going to sell our prescription drugs, and in almost every circumstance, in other countries, we are going to give them a lower price. But to you consumers in the United States, we say: You pay the highest prices.

Let me give you a couple of examples, and I will use Canada, but I could be using any number of countries around the world. Lipitor. We pay 96 percent more. Plavix, 46 percent more. Prevacid, 97 percent more than if you were to buy it in Canada. Zoloft, 52 percent more. It goes on and on.

I said yesterday that I actually sat on a bale of straw on a farm talking to a bunch of folks, and there was a fellow in his 80s sitting on a straw bale talking about life and things, and he said: You know, Mr. Senator, my wife has been fighting breast cancer for 3 years. Every 3 months, we have driven to Canada to buy Tamoxifen because we save 80 percent by buying Tamoxifen to help my wife fight her breast cancer--we save 80 percent by buying it in Canada. So every 3 months, for 3 years, we have been driving back and forth to Canada because it is the only way we can afford that drug. He said: How do you justify that? How do you explain the

difference in price? I said: I can't. It doesn't make any sense to me.

I don't come here to be critical of the pharmaceutical industry, I come here to be critical of their pricing policy. Their pricing policies are unfair to the American consumer. Yes, the pharmaceutical industry produces miracle drugs; a fair amount of them are produced with research we pay for through the American taxpayer at the National Institutes of Health. Others are produced with the research and development done by the drug industry themselves. But I would say that miracle drugs offer no miracles to those who can't afford to buy them, and that is the point.

What is fair pricing for pharmaceutical drugs, and why is it so unfair at this point to the American people? I introduced a piece of legislation with many of my colleagues, and let me read a list of the bipartisan cosponsors, Republicans and Democrats, who sponsored the legislation that we introduced in this Congress, the very legislation I have now offered as an amendment to this bill. Let me go through a list of some of the names. Myself, Senator Snowe, Senator Kennedy, Senators Stabenow, Bingaman, Feinstein, Nelson, Kohl, Schumer, Inouye, Brown, Sanders, Senators Grassley, McCain, Specter, Collins, Durbin, Pryor, Levin, Leahy, Tester, Conrad, McCaskill, Johnson, Casey, Boxer, Salazar, Clinton, Lincoln, Feingold. Thirty-three sponsors for this legislation that I have offered as an amendment here today.

Let me now begin to describe a few of the opponents' arguments and then respond to them. My colleague, Senator Cochran, came out and offered an amendment that says in order for this to be effective, the Secretary would have to certify that it poses no additional risk to the public health and safety. Well, that is an amendment that is designed to kill the bill because the Health and Human Services Secretary will not certify to anything.

Does anyone think the Health and Human Services Secretary or the FDA or anybody is going to certify that the chicken feed served to 3 million chickens with contaminated material from China, which now goes into our food source that humans are eating in this country today, that poses a risk? Or how about we say that we want them to certify that the vegetables imported into this country from Mexico pose no additional risk? Does anyone think anybody is going to certify to that? Do you, really?

I could go on at great length. Does anybody know of any circumstance in which any part of our food supply is certified by anybody saying that the import of this poses no additional risk? No. So this is an amendment designed to make this inoperative.

What my amendment does is actually make our drug supply safer with respect to the importation. Because the fact is people are now going back and forth across the border, those who can get there by car. Most Americans can't, but most are bringing prescription drugs back across the border for a 3-month supply. This makes that even safer.

I am going to go through a number of the safety areas here, but first let me say this. I understand that the pharmaceutical industry wants to continue its pricing policies. I understand that. It is perfectly understandable. I have some differences with them.

In the morning, perhaps while you are brushing your teeth or shaving, getting ready for work, you might turn on the television and what do you hear them saying on television? They say, well, you need to go talk to your doctor. You are brushing your teeth and thinking, why on Earth should I go talk to my doctor? Because the television advertisement says that you need to see if the little purple pill is right for you. You need to ask your doctor whether you ought to take the purple pill. I don't know what the purple pill is, but you get this urge that you think, maybe I should go ask somebody. If everybody is taking the purple pill, maybe I should find out if the purple pill is right for me. Maybe it is right for my colleague from Wyoming or West Virginia. Maybe we all ought to be taking the purple pill. I don't know.

If they ever describe what the purple pill does, they also have to then describe what the potential risks might be of the pill. But in most cases, the TV just says, go talk to your doctor to see if it is right for you. So we have a lot of advertising going on, and we dramatically increase the use of prescription drugs. Go talk to any doctor and ask them if patients are coming to them and telling them what kind of prescription medication they want to take because they heard it on television. Go ask a doctor, and I tell you what the doctor will say. Absolutely.

Of course, these are medicines that you can only get because a doctor has said you need them and, therefore, I prescribe them. Television advertising is creating a demand. I am not here with an amendment on television advertising, but I am observing that every morning they ask whether the purple pill, or whatever other medicine they are talking about, is right for you and that you ought to be visiting with your doctor about it.

In addition to the issue of demand, there is the issue of pricing. I don't know. Somebody doesn't have to give me five reasons or three reasons or even two reasons. I want somebody to give me one reason, just one, that says we think it is perfectly defensible that the American people ought to be charged the highest prices for prescription drugs. Or in the specific case I mentioned, we think it is perfectly defensible that the American consumer taking Lipitor ought to be charged twice as much as the Canadian consumer. Give me one reason. I am not asking for five, just one reason. I can't believe there is one person on the floor of this Senate that has the ability to construct one thoughtful reason in support of that policy.

Let me put in the Record a letter the AARP has written yesterday. Let me read a little bit of it:

On behalf of the AARP's more than 38 million members, we

urge you to support the Dorgan-Snowe importation amendment.

This amendment provides for the safe, legal importation of

lower price prescription drugs from abroad.

In the quest for lower-priced prescription drugs, many

Americans are already importing prescription drugs from

abroad. [The Dorgan-Snowe] amendment would create a framework

for the safe, legal importation of prescription drugs that

will better protect the health and pocketbooks of those

desperate for lower-priced prescription drugs. We are also

very pleased to see that the [Dorgan-Snowe] amendment

includes a number of safety requirements including

inspections and measures to prevent the counterfeiting of

imported drugs.

I ask unanimous consent that the entire letter be printed in the Record.

It is interesting to me that those who have spoken against this come to the floor of the Senate with the specter of counterfeiting. Counterfeiting exists at this point. My amendment will make it less likely. This puts in place the very safety features and the very capability to try to shut that down. But if they are talking about counterfeiting that is existing now, it is existing without these kind of safety precautions on importation.

Let me describe a man, a very courageous man named Dr. Peter Rost. He came to testify at a hearing we held on the subject of reimportation. Peter Rost was responsible for a region in northern Europe where they did this routinely. They had an approach in Europe called parallel trading. If you are in Germany and want to buy a prescription drug in France, that is not a problem. If you are in Italy and want to buy a prescription drug in Spain, that is not a problem. They have done this for a couple of decades. Dr. Peter Rost was in charge of a region in northern Europe. He said:

I never once--not once--heard the drug industry, regulatory

agencies, the government or anyone else saying that this

practice was unsafe. And personally, I think it is outright

derogatory to claim that Americans would not be able to

handle reimportation of drugs, when the rest of the educated

world can do this.

This from Dr. Rost. He actually paid a price for speaking out and speaking the truth. He actually was working for Pfizer Pharmaceuticals at the time. He has had a little problem with his employer, but that is another story perhaps for another day. But Dr. Rost said it right, in my judgment.

Let me, if I might, show this quote from Tommy Thompson, former Health and Human Services Secretary. He says:

The law is this: In order to import drugs from any country,

and especially Canada, I have to certify that all those drugs

are safe. That's an impossible thing. If Congress wants to

import drugs, they should take that provision out, because

the Secretary of Health and Human Services cannot certify

that all drugs coming into America are safe.

Let me tell you something about Tommy Thompson. I like Tommy Thompson. He was a Governor from Wisconsin. That's a guy with spirit. I kind of like him. In fact, I think he is thinking about running for President. I probably will not vote for him because I am going to vote for a Democrat in this coming election, but I like Tommy Thompson. Do you know what he said to me at the elevator, right outside this Senate door after he left Health and Human Services? He was getting off the elevator as I was coming on the elevator, and I had been down to see him about this issue of reimportation of prescription drugs. I said: Secretary Thompson, why don't you work with us to get this done?

He said: I can't.

He explained there are lots of things going on, including the White House makes the call on this policy, et cetera. At any rate, after he left as Secretary of HHS, he was coming off an elevator out here and I was getting on the elevator. We said hello. I like him. I think he was a good Secretary.

He turned around and said to me: Byron, he said, keep going on that imported drug issue. You are right about that. You are right about that.

That is after he left office. He comes from Wisconsin. He knows. That is a State that borders Canada. He knows his constituents are able to just go miles up into Canada and seek prescription drugs for a fraction of the price.

Let me respond for a moment to this issue of safety because my colleague from Mississippi and others have spoken about it. David Kessler, he served for 8 years as FDA Commissioner. He is a terrific public servant. In my judgment, there has been none better than Dr. Kessler over at the FDA. Here is what he said:

[The Dorgan-Snowe bill] provides a sound framework for

assuring that imported drugs are safe and effective. Most

notably, it provides additional resources to the agency to

run such a program, oversight by the FDA of the chain of

custody of imported drugs back to FDA-inspected plants, a

mechanism to review imported drugs to ensure that they meet

FDA's approval standards, and the registration and oversight

of importers and exporters to assure that imported drugs meet

those standards and are not counterfeit.

Let me make one with respect to this. A couple of my colleagues stood on the floor and said: Well, you would create a giant bureaucracy in order to do this. That is interesting. The Congressional Budget Office actually scored this bill we have introduced. Do you know what the score was? This will save $50 billion in a 10-year period.

With a ``b,'' $50 billion; just over $5 billion of that savings is to the Federal Government; just about $45 billion of that savings is to the American consumer. Is that an illusion? No, that is the score we have.

We come to the floor of the Senate and the question is asked: Whom do you stand for? Whom do you stand with? Some will say: You know what, we believe--they will not say that. I do not believe they will stand and say: We believe the current surprising strategy is right, by which Americans are charged the highest price. I don't think they will say that. I think what they will see is we think there are serious safety issues with this.

Let me again refer back to the expert who would perhaps know more about this than any other American. I have heard things read on the floor of the Senate by the assistant this or the assistant that. The last assistant we had come over to a hearing I held had not even read the bill. That is some assistant. At any rate, we don't have to worry about assistants. Let's worry about Dr. David Kessler, who I think is the preeminent authority. He said we can do this; we can do this, and it will make the drug supply in this country safer.

I wish to talk about the issue of safety. It is not as if prescription drugs are not coming into this country from other countries. They, of course, are. Our pharmaceutical industry, and others, manufacture all over the world and then they ship these drugs into our country to be sold here. But there is a law that prohibits anyone other than the manufacturer to ship them in. Lipitor is made in Dublin, Ireland; Nexium is made in France; Tricor is made in France; Actos is made in Japan; Vytorin is made in Singapore and Italy and the United Kingdom. Those are pills made elsewhere, the medicines are made there and they are shipped here. Are they safe? Sure. I believe they are safe. I believe we have an enormously safe drug supply, despite the fright that is discussed on the floor of the Senate about counterfeiting.

Is counterfeiting an issue? Sure, it is. It has nothing to do with this subject. Counterfeiting exists now and we have to take action and steps to fight it and we should fight it aggressively. But the fact is, this legislation that we introduce has a range of safety features that will guarantee the safety of FDA-approved prescription drugs that are imported into this country.

First of all, we provide that only FDA-approved medicines with a ``chain of custody'' will be sent into this country. Dr. Mark McClellan, who used to head the FDA, and I was very critical of him because he continued to speak as if he represented the pharmaceutical industry instead of regulating it as head of the FDA, he and I had substantial differences, but even he said the chain of custody in Canada is safe, almost identical to the chain of custody for prescription drugs in the United States.

If that is the case, and he said it, then tell me with respect to this risk,

I go to a little one-room drug store in Emerson, Canada, with a woman named ``Sylvia'' and a number of other senior citizens. We take a little bus up to a one-room drugstore in Emerson, Canada, and they bring their prescriptions.

That drug store has a licensed pharmacist, as the drug store a few miles south of the border has, a licensed pharmacist and a chain of custody from the drug manufacturer to the wholesaler to the retailer to the drug store. We go to that drug store and Sylvia and her friends buy prescription drugs at a fraction of the price they would have bought it in Fargo, ND, that morning. Tell me, is there a risk in that transaction? The answer is no. Don't represent there is because there is not.

The chain of custody is nearly identical. I am speaking now of Canada. Tell me there is a risk and you are wrong, there is not.

All the protestation on the floor of the Senate on this issue is protestation in support of the pharmaceutical industry. I like the industry. I have been helpful to them. I support research and development tax credits to find new prescription drugs. I have done a number of things to say I want us to be able to have a successful pharmaceutical industry in this country. But I am not willing to go so far as to say it is OK to me, I will be quiet if you decide the pricing strategy is we are going to price our prescription drugs at the highest prices for the American consumer. I will not sit in this chair and say it is fine with me. It is not, and that ought not be fine for any Member of the Senate. It should not.

Let me make some comments on safety. One-quarter of the prescription drugs taken in this country are produced outside this country in foreign manufacturing plants. In the last 5 years, the FDA has inspected more than 850 foreign drug factories in 41 different countries. The drug industry wants to take advantage of the global economy to manufacture their drugs in lower cost countries, but they do not want a licensed U.S. pharmacist and drug wholesalers to be able to take advantage of the global economy to get the best price for the American consumer.

Let me say that again. The pharmaceutical industry wants to take advantage of the global economy for the purpose of their manufacture and profitability, but they do not want a licensed U.S. pharmacist or licensed wholesaler to be able to access those same drugs from a licensed wholesaler or pharmacist in another country in order to pass along lower prices to the American consumer. I do not think that is right.

We have addressed all the issues that have been raised by two former Secretaries of Health and Human Services, saying in order for me to certify, we need to have this and that. We have addressed those safety issues in this legislation. Yet if you listen to the opponents who stand on the floor of the Senate with the talking points, there are safety and security issues and all these issues--I mean I have gotten the talking points, too, from the pharmaceutical industry. Heck, if I were in their position, I would want to keep this situation as long as possible. You have a good deal, don't give it up.

But one of my colleagues yesterday, speaking on the floor, said: The people who are offering this amendment--and again this amendment goes from Senator Kennedy to Senator McCain to Senator Grassley to Senator Stabenow back and forth, Republicans and Democrats. One Senator, one of my colleagues, stood up and said there are political motives.

I said I hope you don't mean that, and I hope you will withdraw that. This is a thoughtful serious debate. There are plenty of people who feel strongly in opposition to my amendment. Fine. But then you should stand and debate the proposition that you support. We support the current situation. We support the circumstance in which a pricing policy that prices the prescription drugs higher for the U.S. consumer is already with us. That ought to be the proposition you stand and support.

You ought not stand and say there are significant safety issues here because that is not the case. It is not.

There is much to say, and a number of my colleagues will continue to debate this issue. My own view is this is a hard issue to get passed on the floor of the Senate. I say that having had some experience with it.

I must say I admire the pharmaceutical industry. They have been tough opponents. They feel strongly about their profitability. They say a couple of things. No. 1, this is unsafe. It is not. No. 2, it would somehow exacerbate counterfeiting. It will not. Counterfeiting now exists. We need to address that, but this would in many ways make the supply of drugs safer. They say a number of other things they believe-- that this would cause the American people to change their buying habits in ways that would be unhelpful to them. They believe you do not have a chain of custody that you can control or see that is transparent. That is not true.

You know, I mentioned earlier about this issue of the industry itself. I want the pharmaceutical industry to succeed. They succeeded. This has been a very successful industry. They have made a great deal of money. But on this issue of research and development, I want them to engage in research and development. We are doing it here in the public sector of the NIH. We turn that material over to the pharmaceutical industry. They do research and development. Good for them. They spend a massive amount of money on promotion and development. I think that is of some concern for a number of people, but I am not here saying I do not want the pharmaceutical industry to succeed. There are those who also say, in addition to safety and other issues, they will say, all right, if you do not allow a pricing policy that prices prescription drugs at the highest level for the American consumer, it will mean less research and development by the pharmaceutical industry.

The fact is, more research and development has gone on in other countries in which they charged lower prices for the same prescription drugs. So how does that hold water? It does not. My hope is, at long last, perhaps, this Senate will stand up for the interests of the American consumer. At long last, we can put to bed these specious arguments about safety because they are not applicable. Read the bill. These arguments about safety are not accurate. Let's put to bed this connection between counterfeiting. It is not accurate. Let's also stop talking about how this would shut off research and development. That is not accurate.

Let's talk about what this bill would do, what this piece of legislation, this amendment we have now offered is. It would save about $50 billion over 10 years, $5 billion a year. It would probably require the drug industry to reprice for sure because, the fact is, if they are pricing at the highest levels to the American people, and they say that is the only way they can recover their costs, perhaps others ought to be paying more to recover costs. I don't know. I am saying that the industry, I believe the top seven U.S. pharmaceutical companies, a couple of years ago made $34 billion together. The industry has done very well. But there are a whole lot of folks in this country who haven't.

It was about 9:30 one night in a tiny town north of Highway 2 in North Dakota. I had a town meeting. At the end of the town meeting, an older woman came up to me, and she was probably in her early eighties. She said: Mr. Senator, may I speak to you? I said: Sure. She grabbed my elbow with her hand. She began to speak. Her eyes welled up with tears and her chin began to quiver. She said: I am in my eighties. I don't have much money. She said: I have got heart disease and diabetes. My doctor prescribes medicines for me that are too expensive. I cannot afford them. Is there any way you can help me, Mr. Senator? Is there a way you can help me?

This woman, with tears in her eyes, was asking: Is there someone who can help me manage this disease of mine because I cannot afford these medicines?

We have taken steps to try to be helpful. I might say that some in the drug industry have taken steps by offering programs to low-income people. It is not enough. But I commend those who have and recognize it. But we should not have to do that in this country. We should not have the highest prices for prescription drugs. We should not have an 80-year-old woman driving

to Canada to pay four-fifths less in cost for Tamoxifen to treat her breast cancer. That should not happen.

So let's do this. Let's create a regime of safety--which we have done. Wonder about it? Go talk to Dr. David Kessler. You find a better expert, you tell me his name. We have created a regime of safety here that will work. Then let us decide to proceed, as Europe has done, as others have done, to allow the global marketplace to work for real people, to work for ordinary folks, not only the big interests. The big interests always do well. At the end of the day, when all of the dust settles, and all of the shouting is over, guess who almost always wins. Yes: Them that's got is them that gets and I ain't got nothing lately. I think that was Ray Charles.

Isn't that always the case? When the dust settles, the big interests always win. Let's hope when the dust settles here tomorrow morning, and we have a vote on something that is important, is something that will help a lot of American people, millions, tens of millions, hundreds of millions, let's hope when the dust settles here, ordinary Americans will say, you know what. We won today in the Senate. Hallelujah, we won a vote in the Senate. Let's hope that is the case tomorrow morning.

I yield the floor.

Mr. President, I have listened to some of the debate on the floor of the Senate in opposition to the amendment I have offered with many colleagues dealing with the reimportation of prescription drugs. Especially entertaining was to hear the Senator from New Hampshire, Mr. Gregg, describe North Dakota wheatfields. The Senate is a place of fascinating and interesting debate. I expect we will have more of that in the coming hours, leading up to a vote tomorrow on a cloture motion on this amendment.

The continued and insistent reference to this amendment posing safety risks, or risks of unsafe prescription drugs, is at odds with everything we know to be the case. I described Dr. David Kessler, and I suggested if anybody knows a more important, better informed expert than Dr. David Kessler, who was head of the FDA for nearly 8 years, tell me his or her name. I described the statement that Dr. David Kessler made that says this will make the prescription drug supply safer. In fact, the regime of safety we have put into this amendment is appropriate, important, and will mean that we will be able to allow reimportation without a safety risk.

Despite the evidence, we continue to hear this issue. I was thinking, as I was listening to this a while ago, about the Lincoln-Douglas debates, when Lincoln became enormously exasperated at one point and he said to Douglas: Tell me, how many legs does a horse have?

Douglas said: Well, four, of course.

Lincoln said: Now, if you were to call the tail of a horse a leg, then how many legs would a horse have?

Douglas said: Well, five.

Lincoln said: You see, that is where you are wrong. Just because you call the tail a leg doesn't make it a leg at all.

The same principle holds true now on the floor of the Senate. You can say what you want, but that doesn't make it true. Safety issues? That doesn't exist in the amendment we are talking about. This will make the drug supply safer. While I am speaking of Lincoln and Douglas, let me say something else that Lincoln said, which has always been interesting to me. He was describing his opponent's arguments. He said: Your argument is as thin as the homeopathic soup made from boiling the shadow of a pigeon that has been starved to death.

Wasn't Abraham Lincoln wonderful? That description can still exist for some of the arguments we are hearing these days on some of these issues.

I hope my colleague was not serious a few moments ago when he said this is an amendment that is not worthy and is put out by a bunch of people who want to put out press releases and aren't concerned about the safety of the drug supply. My colleague surely doesn't mean to say that Senators Grassley, McCain, Snowe, and Collins on his side and Senators Kennedy, Stabenow, Brown, and so many on our side--the 33 Senators who have come to a serious issue with a thoughtful proposal-- did so because they want a press release. My colleague knows better than that. He perhaps ought to tell the Senate he knows better than that.

I respect those who disagree with this amendment. I hope they will respect as well our determination to correct something we see as a serious problem. When my colleague says we don't want to give up our lead, describing our lead in pharmaceuticals and the development of prescription drugs, I don't want to give that up. Let me tell you another lead we don't want to give up; that is, the lead in providing the highest prices in the world to the American consumer who needs prescription drugs. That is a lead we ought to relinquish right now. I wonder if my colleague would agree with that.

Mr. President, this is an interesting debate, a useful debate. It will conclude tomorrow with the vote. My colleague from Michigan, Senator Stabenow, has gone across the bridge that connects our two countries, taken busloads of senior citizens and has been involved in this issue for many years, believing that we ought to insist on fair pricing for prescription drugs for the American people. I am pleased that she was one of the people who helped put together the bill introduced by 33 Senators, and I am pleased that she is a strong advocate for the amendment that we have added to this piece of underlying legislation.

I yield the floor.

Mr. President, I join with the ranking member of the HELP Committee--the Health, Education, Labor, and Pensions Committee--in raising the concerns and agreeing with the concerns he has raised about the reimportation proposal which has come forward from the Senator from North Dakota, which has been debated on this floor a number of times.

The issue, of course, is the safety and efficacy of products which Americans buy. The FDA has been given the responsibility and has executed that responsibility extraordinarily well to make sure when an American citizen buys a pharmaceutical product or a medication, it is what it says it is and it does what the doctor prescribes.

If you start buying medications internationally, you are in the position where you have no capacity for the FDA to monitor that purchase. So the drug may be represented to be an FDA-approved drug, but it could easily not be. In fact, case after case has been discovered of adulterated and changed medication coming into this country under the representation the medication which is being purchased is medication which has been approved by the FDA. So you are basically opening up a massive loophole in the area of safety for the American citizenry.

Now, the demand for this comes from the cost of the drugs. People want to be able to go across the border to Canada, which is obviously a very sophisticated nation, and buy a pharmaceutical product there, which costs significantly less than the same pharmaceutical product may cost in the United States. That is a natural instinct of the market economy and of people. But critical to this exercise, of course, is the ability to get a safe drug.

If you go across the border, and you buy a pharmaceutical product which is alleged to be one thing, and it turns out to be another thing, the damage it causes you is going to be economically much more significant than the savings which you may have accomplished by purchasing that drug across the border.

Also, it should be noted that with the Part D pharmaceutical program which we now have relative to Medicare, the pressure--because pharmaceutical products are now insured and people receive them under the insurance plan as created under the Part D program, which has been an extraordinary success to supplying pharmaceuticals, though its cost remains extraordinarily expensive for the next generation of Americans--but pharmaceutical products are now available under an insurance program to most American seniors, and, as a result, if you are a senior, one of the people most likely to use a large number of drugs, and most often are on a fixed income and have problems purchasing drugs as a result of the fixed income situation--those issues were addressed by Part D to a large degree relative to the senior purchasing drugs; and it did create the ancillary problem of creating a huge cost which has to be borne by the next generation--but relative to the supplying of drugs, the pressure which was forcing people to take the chance of purchasing a drug internationally has been relieved to some degree, significantly in the area of senior citizens.

I proposed language which would create a safe pharmaceutical approach, where you would create an Internet pharmacy approach, where you would create a regime under the FDA where people could go on the Internet and buy pharmaceutical products knowing they have been approved by the FDA.

Today, unfortunately, that is not the case. If you go on the Internet, and you purchase something through a pharmaceutical firm off the Internet, you do not know whether that product--even though it may be represented to be FDA-approved--is FDA-approved because there is no way to certify the

site you are purchasing from is an FDA-approved supplier.

So this reimportation bill is essentially going to create an atmosphere where those Internet pharmacies are going to become basically the ``wild west'' of supplying drugs in this country, and you are going to see people going on to these Internet pharmacy sites and purchasing drugs they think are being represented as an American- approved drug that has been reimported--and is at a lower price--but may actually be a totally adulterated drug which will do significant harm to you.

We have seen instances of that already--dramatic instances. Case after case has been reported of people being significantly harmed and in some instances dying as a result of buying pharmaceuticals off the Internet that turned out not to be what they were represented to be from international sites.

So at a minimum, this reimportation proposal, which has received significant support in the past because it has a motherhood name on it--even though it might be actually creating significant problems for children and for other people in this country as a result of the risk it puts people at--at a minimum, this proposal should be subject to creating some sort of a regime where FDA has the ability to monitor and to approve and to make available to the public the knowledge that Internet pharmaceutical sites have been approved by the FDA. That is what my amendment does. It tries to address that.

So we should not move forward precipitously in the way that is proposed by the Senator from North Dakota. We should not be supporting this simply because it has a nice name on it and because he can hold up two bottles which are the same drug but costs differently in a managed economy in Canada and a market economy here in the United States. We should, rather, set up a structure where FDA can be sure that when you buy that pharmaceutical product through an Internet site that is international or from a Canadian pharmacy, that you are getting what they claim you are getting, so when you take that drug, you benefit from it and are not harmed by it.

This all, however, gets to a bigger issue. Probably, there is not time right now to go into it in depth. But the bigger issue is, where do pharmaceutical products come from? Where do all these amazing products, the biologic products that are saving lives in this country and are creating such a much better lifestyle come from? Remember, they do not come from trees, and they are not grown in North Dakota in the sugar beet fields. They are developed through processes which involve years--years of investigation and research.

The average pharmaceutical product in this country takes 12 years and $800 million to bring to the market. Think about that: 12 years and $800 million before you can produce a product Americans can take. That is a pharmaceutical product. If you are getting in the biologics area, which is a much more complicated area, it takes even longer. It is even more complex, and in many instances it is even more expensive.

It is these products that are changing the life expectancy of people and making the quality of life of people so much better. We have basically gone from a medical regime in this Nation where invasive action was always the first call, was always the first event, where you basically went under the surgical knife, to a regime where you are given pharmaceuticals or biologics to try to address a very serious illness. It is a huge step, an exponential step in the direction of better health care and a better lifestyle for Americans and for the world.

Where are these products developed? Well, they are developed here in the United States. Why are they developed here in the United States? Why are almost all the major pharmaceutical breakthroughs and all the biologic breakthroughs coming in the United States? Because we have a market system which allows people to take the risks to develop those products.

We do not fix prices, as they do in Canada or in England, at a rate that is so low that nobody would be willing to invest in developing that product because the return on that investment is too low. We allow people who make the investment, who take the risk, who put the 12 years in, who invest $800 million, to get a reasonable return on their investment and on their effort. As a result, we have the explosion in advances in technology, in medical technology, in biologics, and in pharmaceuticals.

It is a result of the fact that people who want to take that risk, and who have the ability to pursue that type of opportunity to make life better for people by creating these pharmaceutical products and these biologic products, have the capacity to get resources to do it. It is called capital markets.

Now, capital does not flow for goodwill. People do not invest in things because it makes them feel good, in most instances. People invest where they are going to get the best return on the dollars they invest, or a reasonable return on the dollars they invest. So we have to maintain an atmosphere in this country where people are willing to put money--cash, capital resources--into the investment and research and development of pharmaceutical and biological and device products.

But if you listen to the other side of the aisle, almost every proposal they come forward with seems to be of the view that these products are grown in some wheatfield in North Dakota, that they do not take any effort, that they do not require any capital, they do not require any expertise, research, or time. All they require is to be price fixed, to be limited in their ability to be distributed relative to the price that is charged.

Time and again, the other side of the aisle has come forward with proposals which basically undermine the incentive for capital to flow into these research areas. Believe me, if capital is disincentivized from going into these areas because they do not get a reasonable return, they will go somewhere else--they will go into developing software, into gaming, into whatever it is that happens to give them a reasonable return, into investing in some other country's activities in some area.

Capital does not flow out of goodwill into pharmaceutical production, into biologic production, into device production. It flows into those accounts because they expect a reasonable return.

Now, sure, the countries of Canada, England, and the European common market, to some degree, are living off of the fact that we give people a reasonable return on our pharmaceuticals and biologics in this country. That is absolutely true, and it is reasonably disgraceful. In fact, in Canada, they threaten to take people's patents away if they don't--they basically capture American patents if they don't sell these drugs at a price which nobody would have invested in them in the first place to produce them were the price fixed at that level. But that is their policy.

Now, we could subscribe to that policy, which is what the other side of the aisle wants us to do. They proposed it in Medicare negotiations, they proposed it now and passed it here in the child drug review. They proposed it in this reimportation, and they proposed it in the negotiated language relative to Medicare, and in biologic generics. In all of these areas they are basically saying: Well, drugs must appear in the marketplace. We don't have to be concerned with the fact of getting capital into the investment exercise. We don't have to be concerned with the fact that it takes years and years to research these products and hundreds of millions of dollars to bring them to the market, they just appear. We can basically, for lack of a better term, kill the goose that is laying the drug or the biologic or the pharmaceutical or the device that is saving people and not worry about it.

Well, that is not true. If you were to follow all of the proposals from the other side of the aisle, or even a significant amount of them, we would see investment in this area start to dry up. We would see a contraction of the production of pharmaceuticals that save lives, of biologics that save lives, of devices that save lives. We would see fewer and fewer of those coming to the American people and to the world because people wouldn't invest in that activity any longer, or the investments would be significantly curtailed because money would flow in other directions.

This concept of the marketplace totally escapes the other side of the aisle. This concept that drugs have to actually have some flow of capital behind them to be produced because it takes so long to get them to the market, and it takes so much money to actually research them-- and that is especially true in biologics and equally true in devices. It totally escapes the other side of the aisle. Their idea is, we have a good line, we have a motherhood statement, let's let people go buy the drugs somewhere else at a price that is fixed at which nobody would have ever produced the drug in the first place if that was the price. Let's negotiate so we have a regime of price setting at the Federal level, which basically eliminates the capacity for that drug to be competitive.

Let's create a biologic generic which basically wipes out the capacity of the true biologic to actually come to the market and be successful. Let's create an atmosphere where testing on children of the drugs will basically not have a fiscal return which will make it worthwhile to test them on children. Let's do all of those things in the name of the motherhood language of getting a better price for drugs for Americans, ignoring the fact that what you are actually going to end up doing is dramatically limiting the number of drugs coming to the market for Americans, and therefore significantly impacting the quality of life of Americans and our ability to advance the dramatic and revolutionary activity that we are seeing in bringing biologics to the marketplace, which are basically curing and have the potential to cure diseases which have been extraordinarily threatening to the American population for so long.

It makes no sense, if you look at the substance of the issue, what they are proposing. It is totally inconsistent. They are saying they are doing this to help people. What they are actually ending up doing is harming not only the people of today who won't be able to get the drugs because they won't be produced but people in the future because the drugs won't be brought to the market. There is a blindness to the fact that market forces are at work. I guess it is just a function of the fact that you want to get out a good press release, so you are going to send it out. Of course, anybody who takes the position I just outlined is immediately demagogued, and the pejorative tool of the drug industry is thrown out there.

Well, I am hardly that, since I was one of the few people in this Chamber who actually aggressively opposed and tried to stop the Medicare Part D Program, which was the biggest windfall the drug industry ever got and which was voted for by many of my colleagues on the other side of the aisle and which ended up putting an $8 trillion bill which is unpaid for onto our children's future.

More importantly, the reason I take the position I take is because I believe very strongly that America should not give up its lead in one of the industries where it is at the cutting edge and where it is producing jobs and where it is producing the intellectual capital that is going to keep us a vibrant, strong economy. In addition, we should not give up an industry or undermine an industry and geniuses and creative individuals who are producing products which are saving lives and are giving people a better livelihood. So I am not going to sign on to these various jingoistic proposals which are brought to the floor for the purposes of putting out good press releases about how I did this or that for motherhood at the expense of undermining the quality of care for future generations by basically limiting dramatically the ability of people to get capital who want to be creative, who want to invest, and who want to do research in the area of producing biologic products, pharmaceutical products, and medical devices.

That is why I take the position I take, to say nothing of the fact that if you start haphazardly importing products from the Internet and from countries such as Canada, as strong as Canada is, without any FDA oversight or approval of those products, you are going to harm a lot of people at the end of the day. A lot of people are going to be hurt, and some people are going to die as a result of buying products which have not gone through FDA approval and which are not subject to FDA oversight because they are bought from a pharmacy or a provider in Canada, and that product may have come out of India or it may have come out of Afghanistan. It may have come out of Pakistan. It may be adulterated, and it may kill. The same can be said by a factor of 10 relative to purchasing on Internet pharmacies.

So there are some big issues at play. There are big issues at play relative to the future of the health of Americans on the issue of importation, on the issue of negotiation and Medicare, on the issue of biologic generics, and on the issue of making sure that children are adequately tested relative to the application of drugs which are brought to the market. There are big issues relative to safety and big issues relative to whether this country remains on the cutting edge of producing products that help people and give them a better lifestyle with a biological, pharmaceutical, or medical device. We shouldn't just pass these proposals willy-nilly for the sake of putting out a nice press release.

Mr. President, I yield the floor.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

I understand the Senator from Oklahoma wants to go into morning business to make a statement. I ask unanimous consent that after he has completed his statement, that I be recognized for purposes of offering my Internet pharmacy protection and safety bill to the underlying bill.

Madam President, I understand that I may go forward. I appreciate the courtesy of the Senator from Massachusetts.

Amendment No. 993

(Purpose: To provide for the regulation of Internet

pharmacies)

Madam President, today we have been discussing, at some depth, and appropriately so, how to protect American citizens who purchase drugs overseas--from overseas pharmacies or from Canadian pharmacies--or purchase drugs on the Internet. This is a very significant issue for Americans, especially as more and more Americans use the Internet for the purposes of buying all sorts of items, including pharmaceuticals.

So we need to be sure this extraordinary regime we have set up in this country stays intact that allows a person, when he or she goes into an American drugstore or goes into an American supermarket, to be fairly confident the product they buy is not adulterated and the product they buy is what it says it is and that in the instance of a pharmaceutical or a medication, it is going to be what the doctor told them to take. That has been one of the great successes of American Government. It is because the Food and Drug Administration is overseeing this effort to protect the food supply and the pharmaceutical supply.

Whether the Food and Drug Administration has the wherewithal, the legal ability, and the technical and physical ability to protect an American who buys an overseas product, a medicine, and imports it into the United States is very much an issue. The FDA is very concerned about their capacity to police effectively drugs coming into this country, especially over the Internet.

So I have an amendment to this bill which basically is the Safe Internet Pharmaceutical Act, the purpose of which is to give the FDA the authority necessary to protect people who are buying pharmaceutical products over the Internet. This is, in my opinion, very important.

The importance of this has only been further stressed and exemplified by a warning that came out today, fortuitously, from the FDA on the issue of Internet pharmacies. I want to read extensively from this warning because it goes to the essence of the debate we have heard on the floor, especially from Senators supporting the proposal from the Senator from North Dakota relative to reimportation and safety and their representation that it is safe to buy over the Internet and that their amendment will make it legal to buy drugs from outside the United States over the Internet through their reimportation language.

This warning from the FDA states as follows: ``FDA Warns Consumers about Counterfeit Drugs from Multiple Internet Sellers.'' I am going to read quite a bit of the text because I think, first, it is so on point and it is so important:

The Food and Drug Administration (FDA) is cautioning U.S.

consumers about dangers associated with buying prescription

drugs over the internet. This alert is being issued based on

information the agency received showing that 24 apparently

related Web sites may be involved in the distribution of

counterfeit prescription drugs.

On three occasions during recent months, FDA received

information that counterfeit versions of--

I may not get all these medical terms correct, but I hope I do.

On three occasions during recent months, FDA received

information that counterfeit versions of Xenical 120 mg

capsules, a drug manufactured by Hoffmann-LaRoche Inc.

(Roche), were obtained by three consumers from two different

Web sites. Xenical is an FDA-approved drug used to help obese

individuals who meet certain weight and height requirements

lose weight and maintain weight loss.

None of the capsules ordered off the Web sites contained

orlistat, the active ingredient in authentic Xenical. In

fact, laboratory analysis conducted by Roche and submitted to

the FDA confirmed that one capsule contained sibutramine,

which is the active ingredient in Meridia, an FDA-approved

prescription drug manufactured by Abbott Laboratories.

While this product is also used to help people lose weight

and maintain that loss, it should not be used in certain

patient populations and therefore is not a substitute for

other weight loss products. In addition the drug interactions

profile is different between Xenical and sibutramine, as is

the dosing frequency; sibutramine is administered once daily

while Xenical is dosed three times a day.

Other samples of drug product obtained from two of the

Internet orders were composed of only talc and starch.

According to Roche, these two samples displayed a valid Roche

lot number of B2306 and were labeled with an expiration date

of April 2007. The correct expiration date for this lot

number is actually March 2005.

Pictures of the counterfeit Xenical capsules can be seen on the Web site at FDA. I would note they look exactly like the Xenical that is legitimate. We had a Senator here earlier holding up two prescription bottles of, I think it was Lipitor, saying: These two bottles are exactly the same, and one could be bought in Canada for about a third of what it costs in the United States. Well, you can buy this Xenical over the Internet for probably about a third of what it costs in the United States. The only problem is it might kill you. I am going to read further:

Roche identified the two Web sites involved in this incident as brandpills.com and pillspharm.com. Further investigation by FDA disclosed that these Web sites are two of 24 Web sites that appear on the pharmacycall365.com home page under the ``Our Websites'' heading. Four of these Web sites previously have been identified by FDA's Office of Criminal Investigations as being associated with the distribution of counterfeit Tamiflu and counterfeit Cialis.

At this point, it appears that these Web sites are operated from outside of the United States. Consumers should be wary, if there is no way to contact the Web site pharmacy by phone, if prices are dramatically lower than the competition, or if no prescription from your doctor is required. As a result, FDA strongly cautions consumers about purchasing drugs from any of these Web sites which may be involved in the distribution of counterfeit drugs and reiterates previous public warnings about buying prescription drugs online.

Then it lists the 24 Web sites, and some of them have very seductive

names: ``Pharmacea.org,'' ``MensHealthDrugs.net,'' ``MediClub.md''-- very seductive names, in order to draw people into purchasing drugs on these sites.

Madam President, I ask unanimous consent that this press release from the FDA be printed in the Record.

It is, of course, ironic that in the middle of this debate over how you make safe drugs that Americans are purchasing, and assure that the FDA has the proper oversight, that the FDA would be issuing this warning. It is a coincidence. The FDA did not do it because we are in the middle of this debate. They did it because they had received the necessary information to fairly well substantiate that at least in three incidents the medication that was purchased was not the medication that was approved by the FDA, even though it was represented as that medication, even though it came in a bottle that looked exactly like that medication, even though it had a tamperproof seal, and it had a label and a date as to when that medication would expire and a lot number. So it certainly looked legitimate. So this just confirms the concern which many of us have that we have to set up a regime where the FDA can properly review what is happening relative to drugs that are being purchased over the Internet, especially. It is not impossible to do that. In fact, it is very doable. That is why I will offer this amendment.

The amendment I will offer basically sets up a system whereby the FDA will require that pharmaceutical products sold over the Internet be subject to the jurisdiction of the United States and that they get an FDA seal of approval which is tamper-proof. So if a citizen wants to use a pharmaceutical site, he or she can go on line and call up a pharmaceutical site, such as drugs.com or whatever--that may actually be a site, so I probably shouldn't use that term--but a site where you think you can purchase drugs at a better price than what you are going to have to pay for them somewhere else, they will see on that Web site a seal like the Good Housekeeping Seal of Approval, only it will be a tamper-proof seal which will reflect the fact that the FDA monitors that site, monitors that pharmacy.

Also, the pharmacy has subjected itself to American jurisdiction, so that if there is an illegal act, they can be prosecuted, or if there are issues of liability, they can be sued; also, that there is contact information which is based in America relative to that and that there is a searchable database where you can go in and find out what that pharmacy has done in the past relative to its prescription-filling activity.

This would all be supported by a fee system which gives the FDA the resources to accomplish this type of monitoring. It really seems like the most logical thing to do.

There is no way you can stop the imagination and desire of the American people to get the best price. That is part of the essence of our character. So it is reasonable that Americans are going to use online pharmacies, but we have to make sure we have a system where we do not have one approval process for legitimate purchasing of drugs through pharmaceutical activity at your local pharmacy and then another process for purchasing drugs which has absolutely no oversight from the FDA if you purchase on the Internet. We have to make sure that if you are using an Internet site, the site has been subject to the same review as the local pharmacy down at the corner is subject to, relative to the quality and management of that pharmaceutical product they are selling. That is what this amendment does.

I hope no one will object to it, but I know other people will. But they shouldn't because this is really something whose time has come. So I am going to offer this amendment tonight. It is timely, of course, in light of this FDA warning which says there are potentially 24 Web sites they have identified, at least 3 of which are selling adulterated drugs, that they know of, which could seriously harm and possibly, if taken in the wrong dosage, since they aren't the proper drug, actually do more than just harm you, they could permanently injure you.

In light of that warning which came out today, it is totally reasonable and appropriate that the Congress should certainly, if it is going to do a drug safety bill relative to the FDA, include in it an Internet pharmacy safety regime which will give the American people some confidence that when they go on line to purchase a drug on line, the site, the portal they are purchasing it through, is subject to FDA review and the drug they are purchasing is an FDA-approved drug, which is made clear by having this tamper-proof seal of approval. It would also reflect the fact that the FDA actually has physical oversight over that pharmacy, that online pharmacy, and gives the FDA the resources to do that oversight. You can't just say: Go and do it, if they don't have the money to do it; you have to give them the resources to do it.

In addition, it sets up a one-stop shopping site at the FDA where people can go on line to the FDA site, check out that Internet pharmacy, if they wish, and make sure the Internet pharmacy does qualify and does carry FDA-approved drugs.

I think it is a very proper approach. It is something, as I mentioned, which is clearly timely in light of this FDA warning.

Madam President, at this time, I ask unanimous consent that the pending

amendment be set aside and that I may call up amendment No. 993 and ask for its immediate consideration.

I ask unanimous consent that the reading of the amendment be dispensed with.

I thank my colleagues for allowing me to go forward at this time.

Madam President, I yield the floor and make a point of order that a quorum is not present.

Madam President, this week the Senate has the opportunity to set a new and better direction for the safety of the prescription drugs and medical devices that make such a profound difference in the lives of our people.

Every day, families across America rely on the Food and Drug Administration in ways they barely realize. When they put dinner on the table, they are counting on the FDA to see that the food is free from contamination. They trust the FDA to make sure the drugs they take are safe and effective. From prescription drugs, to pacemakers, to chemotherapy, to the food we eat, the FDA protects the health of hundreds of millions of Americans and monitors products that account for a quarter of the Nation's economy.

The FDA should be the ``gold standard'' for safety, but its luster has been tarnished in recent years for failure to protect the American people from unsafe drugs. The public was shocked that the arthritis drug Vioxx was able to stay on the market for 5 years, even though it nearly doubled the risk of heart attack and stroke. Antidepressants used by millions were found to increase the risk of suicide in adolescents. Millions of Americans have needlessly been put at risk, and they want action by Congress to reform and strengthen the agency.

We are responding now with bipartisan legislation that is the product of months of work in our committee. I commend my colleague and friend in this effort, Senator Enzi, for his work on this proposal that will improve the way FDA oversees the safety of drugs. Almost half of all Americans take at least one pill a day, so this legislation will make a difference in the lives of every American family. Our proposals were strengthened by our colleague from New Hampshire, Senator Gregg.

Safety is at the core. Our legislation was guided by the recommendations of the impressive report by the Institute of Medicine on the ``Future of Drug Safety.'' Its major recommendations for reform are included in this legislation.

This chart I have in the Chamber gives the major recommendations for the Food and Drug Administration: Build the internal epidemiology and informatics capacity in order to improve the postmarket assessment of drugs, have postclinical trial results in a public database, have regularly analyzed postmarket study results. This aspect about postmarketing surveillance is a key in terms of drug safety. We have included their recommendations. Another is: Give the FDA better enforcement tools. I am going to refer to that in a moment. Another is: Conduct regular evaluation of new drug safety profiles. We have included that. I will expand on that point in a few moments. Another is: Substantially increase drug safety resources available to the FDA. We have also included those.

So those were recommendations from the Institute of Medicine. We have reviewed the same subject matter. We evaluated those very carefully and we have taken the major recommendations in terms of safety and included them in this legislation.

A small number of health systems in America--now referring to postmarketing surveillance and the use of electronic records-- effectively links the surveillance of various kinds of prescription drugs to safety databases. These systems--Kaiser Permanente, Mayo Clinic, Veterans' Administration--have the means to examine whether Vioxx and other drugs were being used effectively. They found these drugs were being prescribed inappropriately, and they took steps to curb their overuse. As a result, they approved the use of these medications only for patients who had no other options. Overuse went down and safety improved.

The use of these databases should not be limited to the few health systems that currently use them. FDA should make use of every aspect of modern health care technology to safeguard the public's health. Mark McClellan, the former FDA Commissioner, calls these kinds of systems health IT for drug safety. Our proposal includes his recommendations.

Surveillance is essential, but effective action is needed when a safety problem is detected. Each drug has unique risks and benefits. There can be no one-size-fits-all approach to drug safety. That is why our legislation includes a flexible but effective program for safety. We call it a risk evaluation and management system. It can be tailored to the unique characteristics of each drug. It gives the FDA the authority to act when action is needed to protect public health, but it also contains safeguards to prevent such action from being imposed when there is no reason to do so.

For some drugs, it is essential to require postmarket studies, yet FDA today lacks the basic authority to require such trials to be conducted. FDA can request them but it cannot require them, and has few ways to see they are completed. As a result, companies routinely promise to conduct studies that are never even started, much less completed.

This chart I have in the Chamber shows how, under current law, postmarket studies are not completed. These are the studies that have been requested by the FDA because they are for sound safety reasons. Yet 71 percent of them were not even started. Our legislation says when they are required and recommended by the company, they must move ahead.

In its recent report on drug safety, GAO pointed out the failure of the current system. Its report states:

In the absence of specific authority, FDA often relies on

drug sponsors voluntarily agreeing to conduct such

postmarketing studies. But the postmarketing studies that

drug sponsors agree to conduct have not consistently been

completed. The FDA has little leverage to ensure that the

studies are carried out by imposing administrative penalties.

Our legislation solves this problem. It gives the FDA clear authority to require the conduct of the postmarketing studies when there is a public health need to do so, and it gives the FDA the ability to assess fines on those who ignore their responsibilities.

Databases and postmarketing studies help detect problems, but the FDA needs the ability to take other action to protect the public health. Here, too, the current law is inadequate. FDA lacks clear authority to require measures to protect public health. When lives are on the line, doctors are making the critical decisions. But because FDA's authority is so unclear, it must first call the lawyers for their opinion as to whether the agency can act. The Institute of Medicine identified this major weakness of current law and called on Congress to give FDA the authority to require risk management programs when needed to protect health. These programs can be as simple as new information on a drug label or an advisory notice to doctors or as sophisticated as special monitoring of programs for patients who use a particular drug. The legislation does not make the decision about which measures should be taken for which drugs, but it does give the FDA the authority to make the right choice for the public health. This authority has been lacking in the past.

For Vioxx, it took 14 months to change the drug's label to warn doctors and patients of the danger. Because FDA had weak authority, it had to ask the manufacturer to change the label voluntarily, and the manufacturer stalled and stalled. When patients are in danger, FDA should not have to wait to get legal opinions to decide how to protect health. It should be able to act immediately, and our bill gives them that authority.

In many cases, companies have hidden evidence of safety problems. Our bill addresses this abuse by including a public database of all clinical trials and their results. Listen to that: all clinical trials and their results. We protect the trademark aspects of the particular item but require the publication of all clinical trials and their results. A company will no longer be able to hide the results if they do not show what the company wanted.

Some would say any increase in drug safety will inevitably decrease access to needed drugs, but that is a false argument. Consider the situation now. When the FDA is confronted with a new drug that may impose safety risks, or where additional study may be required, with little expectations that those risks will be mitigated by a voluntary approach--and with no ability to ensure that the studies are going to be conducted--FDA might reasonably conclude the risks of approving the drug are too great and, therefore, not approve it.

Under our legislation, the calculation is reversed. With this bill in place, FDA could allow patients to have access to the drug, secure in the knowledge that effective safety measures were in place. That is not my judgment; it is the judgment of a coalition of advocacy organizations representing over 30 million patients. This coalition, the Alliance for Drug Safety and Access, wrote Congress a letter saying:

[T]his legislation gives the FDA the ability to continue to

study the safety of drugs after approval, flexible

enforcement tools necessary to ensure compliance with these

new safety protections, and additional funding to support

these new activities. Allowing the agency to act on clear

safety signals could actually allow the FDA to approve drugs

more quickly, knowing it will have the ability to respond on

behalf of patients if safety concerns appear postmarket.

That is support from the organization that has been put together that is protecting safety for the consumers. That is the balance our legislation strikes: greater safety, hand in hand with better access.

As our debate continues, I will discuss additional aspects of the legislation, especially its new ideas for accelerating drug development, its renewal of our commitment to safe and effective drugs for children, and its provisions to improve drug science, and increase the transparency of the FDA.

We are also working with our colleagues from Iowa and Kansas, Senator Harkin and Senator Roberts, on ways to refine our provisions on direct- to-consumer advertising, to make certain they are consistent with the Constitution. We are working with Senator Durbin and other colleagues on the committee on proposals for food safety on pet food. These bipartisan proposals are being readied for floor action shortly. I look forward to further discussions on them.

Our committee will continue to work to improve the ways FDA can monitor and improve food safety. In this new era of life sciences, medical advances will continue to bring immense benefit for our citizens. To fulfil the potential of that bright future, we need not only brilliant researchers to develop the drugs of tomorrow but also strong and vigilant watchdogs for public health to guarantee that new drugs and medical devices are safe and beneficial, and that they actually reach the patients who urgently need them.

Congress has ample power to restore the luster the FDA has lost in recent years. The legislation we are now considering represents a bipartisan consensus on the best way to get the job done.

I want to mention a few additional items. I am quoting now from the FDA's report brief on 2006:

The Food and Drug Administration's authorities must be

clarified and strengthened to empower the agency to take

rapid, decisive action when necessary and appropriate. FDA

lacks the clear, unambiguous authority needed to enforce

sponsor compliance with regulatory requirements and, instead,

relies on the process of productive negotiations with the

industry.

We have taken that. That is their No. 1 statement.

Included in that we have--this is the IOM committee.

The committee recommends that the FDA ensure that the FDA

has the ability to require postmarketing risk assessment and

to monitor and ensure the safe use of drugs.

We have done it.

These conditions may be imposed both before and after

approval of a new drug, a new indication or a new dosage.

We have incorporated those concepts, as well as the identification of some new contraindications or patterns of adverse effects.

It talks about the distribution, conditioned on compliance, with agency-initiated changes and drug labels. We have achieved that. Conditioned on specific warnings, proposal materials, distribution conditioned on a moratorium, on direct consumer advertising. We have at least addressed that.

It also includes distribution of restrictions for special training, if need be, for pharmacists and physicians. It also has distribution conditions on the performance of specific medical procedures. It talks about clinical trials. FDA needs increased enforcement authority, better enforcement tools directed at drug sponsors which should include fines and injunctions and withdrawal of drug approval.

We haven't taken every one of these recommendations--not every one precisely--but we have taken the essence of these recommendations, and we have included those that are as a result of our extensive hearings. I could go on with this, and will later on perhaps, but I won't today. I wish to mention, finally, the various groups.

We mentioned the Alliance for Drug Safety and Access. I will include these letters of support. This is to Senators Kennedy and Enzi:

On behalf of the Alliance for Drug Safety and Access, we

write today to express our support for the goals of titles I

and II of S. 1082, the Food and Drug Administration

Revitalization Act.

It will continue the timely access of patients to new

therapies and will improve the ability of the Food and Drug

Administration to ensure safety of drugs already on the

market.

S. 1082 takes a life-cycle approach to the risk-benefit

assessment of drugs and biologics--

This is so, though we have not included biologics in this proposal with regard to drugs as endorsed by the Alliance and recommended by the Institute.

We are pleased that this legislation gives the FDA the

ability to continue to study the safety of drugs after

approval, flexible enforcement tools necessary to ensure

compliance with the new safety protections, and additional

funding to support these new activities.

It allows the FDA to approve drugs more quickly, knowing it will have the ability to respond to the patients if safety concerns appear afterwards.

This represents a group of at least 30 different health organizations that have followed this most closely.

We have a letter that has been sent to Senator Enzi and myself, Senator Dodd and Senator Clinton, talking about how this legislation impacts children and giving special recognition, as they should, to our colleagues and friends, Senator Dodd, who has been such a leader in this area, and Senator Clinton as well, who has been so thoughtful in this area.

It points out the Pediatric Medical Device Safety Improvement Act of 2000 provides a comprehensive approach to ensure that children are not left behind in cutting-edge research and revolutionary technologies for medical devices. It talks about swift action and passage.

The American Psychiatric Association talks about how the provisions of this bill will ensure the Food and Drug Administration is equipped with the necessary tools to enhance its consistency, transparency, and accountability in ensuring the safety of drugs postapproval.

The American Psychiatric Association advocates for patient safety and supports further postmarket research of medications to ensure the safety and efficacy of medications used to treat mental illnesses. The letter says:

We look forward to working with you to rebuild the

Administration's reputation and creating a universal drug

safety monitoring system that is reliable and dependable.

They indicate their strong support for the legislation.

Again, another letter of support from the American College of Pharmacy, and it talks about the particular emphasis we have placed on improving science knowledge, which improves their decisionmaking regulatory oversight. Science knowledge grows on a daily basis. We know we are in the life science century. We want that agency, the FDA, to have the best in terms of science and science knowledge, and we have included special provisions to enhance that particular effort, and this association has recognized that.

We also have a letter from the Consumers Union, and they talk about their strong support for this legislation. They oppose any weakening amendments of this important legislation. It also has some reference to some of the recent polls which point out that 96 percent of Americans agree that Government should have the power to require warning labels if safety problems are identified, with 80 percent of those strongly agreeing to that authority. Right now the FDA has to negotiate safety warnings.

It also talks about the strong support the American people have for the FDA, which doesn't have the authority to provide studies to be performed once the drug is on the market. The American people are way ahead of us. They also show strong support to make public the clinical trial studies. This bill does that. Sixty-eight percent of the American people strongly agree the drug studies should be made public.

Eighty-four percent of the American people believe advertising for prescription drugs with safety concerns should be prohibited. Then it continues: Three-quarters of consumers agree that drug ads lead to overprescribing, with 38 percent strongly agreeing and 59 percent agreeing that the Government should restrict advertising by pharmaceutical companies altogether. We haven't gone that route, but we have taken safety considerations to heart.

Then the other letters from the Cardiovascular Association that talk about the particular provisions dealing with children, the pediatric provisions in here which are enormously important, and other letters. I ask unanimous consent that the appropriate representative group of letters be printed

in the Record and the references to some of the editorials from across the country--I am not going to ask that they all be printed, but I will ask that selected ones be printed in the Record and that other newspapers be referenced showing strong support.

Madam President, we have very solid legislation that is going to make a very important difference--very important difference in protecting the American consumer. We now have in place leadership at the Food and Drug Administration; for 5 of the last 6 years that has not been so. We have in place leadership, and we are going to give that agency the kind of tools necessary for protection the American people are entitled to and to restore the kind of luster that should go with the Food and Drug Administration, which is so important to the health and well-being of American families.

Madam President, I ask unanimous consent that the order for the quorum call be rescinded.

Madam President, I was necessarily absent from the Senate at the conclusion of Senator Enzi's remarks. I again thank him for an excellent presentation, with the emphasis on the safety aspects of this legislation.

I think all of us are reassured we are on the right track, not only as a result of the extensive hearings we held but the very extensive review the Institute of Medicine gave, a highly regarded, highly respected agency. During the course of the hearings, we had very good attendance and exchange of the representatives of the Institute of Medicine, and we have worked with them subsequently in terms of the language and refinements.

As we said, we didn't just copy everything, but the essential aspect of the safety provisions in our legislation is, quite frankly, preferable.

I look forward to working closely with Senator Enzi as well on the other areas of public policy in terms of food safety and the follow-on biologics which we are very much involved in as well.

I thank the Senator from Ohio for his comments. We know him for being someone who has spent a great deal of time making sure safe drugs are going to get to people who need them. There are many dimensions to this debate. He has certainly been one whom, over the course of time, on the Health Committee in the House of Representatives, I have had an opportunity to work with on a number of health issues. He has been very active and involved with this issue on our committee and also on making sure we are going to have not only safe drugs but also have access to them.

I will take a moment, because I think it is probably worthwhile in the opening presentation, to go through one of the real safety crises we had with prescription drugs and look at what existing authority was there and then how that could have been handled under that legislation.

People will look through this legislation--it is not all that long, but it is complex. The results are enormously important and very basic and very fundamental. I use Vioxx as a point of illustration, which I think most Americans remember the circumstances where hundreds of thousands of Americans with heart needs were put at risk.

This was really the question--this is the FDA Reauthorization Act-- how we could have averted the Vioxx disaster. I think people are beginning to study this legislation, and also our colleagues who are reviewing the record ask about how this legislation can make a difference on a particular drug. This chart is very useful in understanding that point.

Can the FDA quickly detect safety problems with a drug? Vioxx, no. Under our legislation, the answer is yes. Senator Enzi gave an excellent presentation about how that can be done using the most modern technology, using the greatest availability of public and private collections of adverse reactions, and bringing those together within the agency. We know all of that is going to gradually expand in the future, so that agency will have the best of science. They will be able to protect safety. The answer with this legislation is yes.

Can the FDA require label changes to warn of safety problems? The answer with Vioxx was no. They spent 14 months trying to negotiate the issue of the labels. Under our legislation, they would be able to do that.

I mention that as one of the things they will be able to do. They can either take the drug off the market--they have the power to do it. It is not done because you don't want to take the chance that there may be some people in the public, given the health risks, who are justified in taking that particular medication, but for the great mass of people, it might not be. Can we put label changes on? They would be able to do it very quickly.

Are companies stopped from hiding safety problems? This comes back to what both Senator Enzi and I referenced in making public clinical trials. That is enormously important. Senator Mikulski has been very involved in the transparency parts of this legislation. I hope those in the Senate who are interested and concerned about the issues of transparency might take a moment and talk with Senator Mikulski. Hopefully, she will speak on these issues because she has made a very important contribution.

Part of this transparency is that these clinical trials will be available, to understand the significance of any safety problems, which hasn't been the case, but they will also be available to people who may want to enroll in a clinical trial, who have a particular illness, a particular disease and know there is a particular trial that is going to take place and say: I think I want to enroll in that particular trial because it is taking place. People don't know that now. That is enormously important and valuable to people. Whoever becomes part of a clinical trial and finds out a particular drug can be lifesaving, it is of enormous importance and consequence.

We have the knowledge of the clinical trial in terms of safety but also in terms of the opportunities that are coming up, particularly in this period of life sciences, with these extraordinary breakthroughs we are seeing now--the mapping of the human genome, sequencing of the gene, and I think before long in stem cell research we are going to see incredible possibilities, and people are going to want to become part of clinical trials.

But with regard to responding to this--are companies stopped from hiding safety problems, yes; does FDA have flexible tools to enforce safety decisions--it was expressed very well by Senator Enzi. He was talking about the big toolbox. That is the way we should look at it. There is a variety of tools in that toolbox. He explained that. There are a number of different ways that those who are committed to safety can titrate these different availabilities to ensure safety. Some may require a heavier hand than others. What we want, obviously, is to do enough to provide protection but not enough to discourage use where it is necessary.

Finally, is FDA the gold standard for protecting public health and assuring access? We are strongly committed to making sure it is. We believe that with the safety protections we have put in the bill and also the inclusions, working with the pharmaceutical industry in terms of PDUFA and MDUFA to try to always find ways of expediting the consideration of these lifesaving drugs--that was one of the very important purposes, giving emphasis for research of many of the areas of health that are of such concern to the American people: cancer, cardiovascular issues, Parkinson's disease, Alzheimer's disease, juvenile diabetes disease, the AIDS virus, and many others--we can try to move toward a better relationship between the companies and FDA, in the sense that we can move this process, move more quickly, but do it more safely. That is what we are attempting to do, to ensure, in this life science century, that these breakthrough opportunities are going to be available and also do it in a way that will be safe. This is an example of one of the challenges the country has been facing recently, between the old and the new.

We have tried this afternoon to describe in greater detail the various provisions of the legislation. We have not spent a great deal of time on the provisions which were supported by the Senator from Wyoming and myself with regard to children. Our committee has recognized, through the good work of Senator Dodd and Senator Clinton, the fact that children are not just little grownups; they are children. Many of these substances have different reactions, different impacts in terms of their development. It has taken special kinds of focus and attention to try to be more responsive to those needs. Our committee has done that. As a result, we see strong support from the American Pediatric Society and others for the way we have addressed those issues and modernized provisions to encourage greater research but also to protect the interests of children. We have

strong support from the various groups that have spent their lifetime speaking for children.

We will probably have an opportunity to get into some greater detail in discussion of those provisions. As I mentioned briefly in our comments, we have recognized the importance of developing and upgrading the science function in this agency. We think the FDA--at a time we are having breakthroughs in knowledge, in science, in so many areas, we want to make sure the FDA is out there on the cutting edge with respect to these breakthroughs and know where they are going. We have paid particular attention to those as well.

Then the Udall-Reagan Foundation is to try to look longer term at ways in which the agency functions and take a longer look to make recommendations to the private sector and to the public sector about how it can be more effective generally. That kind of idea has not been included in the past. It can very well be enormously valuable and helpful to legislators in the future.

We have tried to get legislation that will provide the protection presently, help and assist breakthrough technologies, and provide a faster track for the American people in the future, but to do it with greater safety protections for all families, and to recognize we are at a time of breakthrough science, which that agency has to have, and there are going to be breakthroughs in different modalities in that agency working in the future. We have tried to build into this an agency that can give us advice so we can be more effective in the future.

I hope we will be able to move ahead. I know we have gone through, in careful detail, the administration's positions over the weekend. We certainly respect those. We have had a good exchange with the administration.

For those who are interested, if they read through the letter they sent to Senator Enzi and myself, and then if they look at the recommendation of the Institute of Medicine, they will find we are much closer to the recommendations of the Institute of Medicine. We may face some amendments in those areas. We look forward to having a good discussion and debate and the opportunity to expand some of the points we have made this evening.

Madam President, we have the legislation before us. We hope those who have an interest and have some ideas, have some amendments, will be in touch with Senator Enzi and ourselves through this late afternoon, early evening, or first thing in the morning. We want to try to address those amendments early in the day, as early as we can. We understand both parties have their lunches and have important matters to discuss, and I am sure this will be among them. But we are ready for any of the amendments, as I underline what Senator Enzi has said. We had great participation in our markup with the members of our committee. As he mentioned as well, we have had enormous involvement of our committee members and many others over the period since the legislation was reported out of our committee until now.

We are still in the process of trying to do business because we think this legislation is so important. We hope those who do have amendments will be in touch with us at the earliest possible time.

Mr. President, I rise today in support of this amendment by Senator Allard which would strike a cap on pediatric research incentives for blockbuster drugs with more than $1 billion in annual sales. That sounds like a lot. We are going to quibble here about whether they get 3 months of additional time or 6 months of additional time. They have had 6 months of additional time.

Incidentally, this is one time per drug. This is not every time they can come up with a child's use they can extend another 3 months or 6 months; this is one time on any drug, they can get an extension of 6 months.

Now we are going to decide that a company that comes up with a really great drug is only going to get 3 months versus 6 months because they make $1 billion in annual sales? Three months' worth would be $250 million in annual sales, and that sounds like a lot, but when you figure out what is profit out of that, it is a much smaller number.

I congratulate Senator Dodd for originally coming up with this incentive. He came up with the idea for 6 months, and it worked. You have seen the chart that shows how dramatically there was an increase in the number of drugs that were studied for kids and how proper doses were derived for kids. The Allard amendment ensures that pediatric studies that are essential to our children's health and well-being will continue to take place, that they

will continue the same as they have with the same incentives and the same requirements. Under current law, in exchange for performing a pediatric study, a manufacturer can receive an additional 6 months of market exclusivity, one time per drug. This is a powerful incentive to ensure pediatric studies are completed. The substitute amendment we are debating today limits this exclusivity to just 3 months, and I am concerned that this will reduce or limit the number of pediatric studies. Senator Allard's amendment would revert back to current law. If we support and pass the amendment of Senator Allard, we go to current law, so manufacturers can receive the additional 6 months of market exclusivity.

Before incentives, there were very few pediatric studies. In the 7 years before Congress authorized incentives, only 11 pediatric studies were completed; 7 years, 11 studies--embarrassing. But at least 132 pediatric studies were completed, and more are ongoing. The current incentive system works.

This is not an abstract policy issue. Pediatric drug studies can mean the difference between life and death for our children. For example, initial research indicates that Viagra, which is a blockbuster drug, can work miracles for children with pulmonary fibrosis, a rare and potentially fatal lung disorder. Viagra seems to relax and expand blood vessels in afflicted children's lungs. Incentives spurred Pfizer to perform studies that are now underway and could save approximately 28,000 children who might otherwise die or suffer greatly. Without powerful incentives, such studies might not get done.

The Democratic witnesses at the HELP Committee's--the Health, Education, Labor, and Pension Committee--recent hearing agreed that caps are a risky experiment. The number--zero incentives, 11 studies; strong incentives, 132 studies--that speaks for itself. Reducing incentives will certainly reduce the number of pediatric studies. We should not undercut a system that is proven to help kids and then say we are improving the program. I don't think so.

I strongly agree we need to do everything we can to make health care more affordable and accessible, but harming a worthwhile program that saves kids' lives is the wrong way to do it. It is wrong to play the politics of drug pricing at the expense of our kids. We should protect these incentives which are proven to work.

Again, I congratulate Senator Dodd for coming up with the idea of providing these incentives. I wish to note for the record it was at 6 months that we provided that. I ask that you support the Allard amendment.

I yield the floor.

One of the things we are trying to do is keep the debate on the children's amendment so we can get a conclusion to the children's amendment before time deadlines come up. So if those who wanted to speak on other issues can reserve their time until later, that would be very helpful.

Mr. President, I, too, encourage people to get their amendments to us, so we can talk about the amendments. The amendment process is a difficult thing around here because it doesn't allow for some of the tweaks noticed by people who have expertise in that area. If we get to talk about them first, sometimes there can be modifications to them before they are put in. We want to move this along and have some things to vote on at 4 o'clock today. I hope everybody will cooperate on it.

I thank Senator Kennedy and his staff and my staff who have been working together with anybody who has an amendment. They were working at 3 and 4 o'clock this morning on different things, trying to get them ironed out so that it would be possible to move the bill forward.

Mr. President, what's wrong with limiting exclusivity for blockbuster drugs? It is the exact opposite of what we should do. The whole point of the law is to leverage the large adult market for the benefit of the smaller kids' market. The effect of the cap will be to discourage companies from studying the effects of the most-widely used drugs on kids. Seventy-five percent of the drugs are not being studied under the current incentive. We need more studied, not less.

Are not companies only studying blockbuster drugs that make the most money, not the drugs needed most in kids? No. According to a Tufts University study, only about 10 percent of drugs with pediatric exclusivity are blockbusters. GAO says most products obtaining exclusivity have annual sales of less than $200 million.

Do companies get to choose the drugs they study? What is to stop companies

from ``cherry picking'' to make money, not help kids? No drug is eligible for pediatric exclusivity unless FDA requests, in writing, a pediatric study of the drug. FDA's decision is based on whether more information about safety and efficacy for children is necessary.

Doesn't the Duke/JAMA study demonstrate that 6 months of additional exclusivity is a windfall? It's been said that a cynic is someone who knows the cost of everything, and the value of nothing. That applies here. The Duke/JAMA study concluded that the financial benefit of exclusivity for blockbuster drugs often exceeded the cost of the pediatric study. This completely misses the point. This law is not about micromanaging drug company profits. It's about helping kids. In fact, the very last sentence of the study reads: ``Clearly, however, the greatest return of the exclusivity program is the benefit derived in obtaining new information relevant and applicable to the care of children, and this benefit should not be compromised.''

Companies can spend only a few million dollars on a study and get many millions in return. Shouldn't the reward be equal to the amount spent on studies? The incentive is designed to raise the priority of pediatric studies among all the competing research priorities for drug development within companies. Just covering the cost of the studies will not do it--the drug company knows it can put those same dollars into the development of a drug for adults that will earn much higher profits. Incentives work by making pediatric study more attractive than other studies for drug companies.

Aren't windfall profits unfair? No. The benefits to kids, and to society in general, from pediatric studies far outweighs the cost.

What are workability issues with the exclusivity cap? FDA says the cap has ``serious workability issues.'' It is unclear how FDA will obtain the right type of sale data or how the data's accuracy can be verified. FDA would spend lots of time litigating the validity of exclusivity decisions, and less time making drugs safe for kids.

Why shouldn't we restrict excessive drug company profit? The problem is not excessive profits. The problem is that most drugs aren't tested for kids. It is wrong to play the politics of drug pricing at the expense of kids.

Mr. President, I will have a lot more comments on this bill at a later time. In light of the comments by the Senator from North Dakota about the importance of reading the bill, I wasn't sure that I had read the most recent copy of it. I think I have the most recent copy of it now. It is a fascinating 140 pages that is being attached to our 300-page drug safety bill. The reason I am checking it is because in the past we have noticed some strong implications for safety problems with drug importation, and I want to make sure we are not opening the door for even more safety problems. I had hoped that the bill on safety wouldn't have to get into the safety of imported drugs, but I can see that is not the direction we are going. I am more than happy to address it.

I am fascinated by the discussion today because the people who normally are talking about free trade are now talking about some restrictions. That would be my side of the aisle. Those who normally rail at any kind of opening of the market to anyplace outside of the United States are the ones who are supporting this bill. It is kind of a reversal of situations.

I have heard the Senator from North Dakota talk about the way the Canadian Government is subsidizing the grain in that country and how that gives them an unfair advantage in the United States market and how we have to be sure that doesn't happen. Yes, the Canadian Government subsidizes. Yes, the Canadian Government gives an unfair advantage to their citizens. On drugs, the Canadians do some interesting things, too. They are a very small, limited market compared to the United States.

Sometimes in business when you are trying to price things, you say: I could pick up a little bit more in the market if I changed my price a little bit. But I am only willing to go after the fringe in order to do that. That is kind of what has happened in Canada. Canada has made it a little more difficult for the drug companies because they say: We are going to negotiate the price. I love that word ``negotiate.'' Normally that means there is a little give and take on both sides and some advantages that are picked up on both sides in order for the outcome that is derived.

In terms of pharmaceuticals, usually ``negotiation'' is the code word for ``price fixing.'' That is what they have done in Canada. They have fixed the price. If you want to be able to sell your drug up there, they will tell you what bid you better come in at and they are willing to have various pharmaceuticals bid against each other for the right to enter that fringe market, a small portion of what is in the United States but a potential customer. If you can cover your costs and pick up a few more sales, perhaps you can increase profits. It is a little accounting trick, but it happens. But they negotiate the price.

There are five drugs for heart that do similar things. They make the five drugs for heart bid against each other. That means one or two of them will win the bid. If your doctor prescribed one of the other three in Canada, you are out of luck. The decision by the doctor is taken away because you will get a good price on the pharmaceutical that may not be quite right for you, but it will be cheaper than what you could have gotten. That is not the way we work it in the United States. We try to have competition between all of the different products and hope that brings the price down.

There is some positive indication that it does bring the price down. We have the Medicare plan D. When they did the calculations on how much that was going to cost, it was considerably higher than what it actually came in at when there was competition among the providers, who in some cases represent more people than Medicare or Medicaid or the veterans and negotiate prices, but they negotiate realizing that we are forcing them to provide all of the pharmaceuticals, not just one or two out of five. If they are providing a plan, they have to provide for the prescription drugs.

When I was doing hearings across Wyoming, I had a little surprise almost at every meeting that I had to explain Medicare Part D. That was somebody saying: I can't get the prescriptions I really want. I was doing all of this promotion before Part D even went into effect. So I knew something was wrong with that kind of a response. It occurred to me that maybe those were veterans. We negotiate the price on drugs for veterans. That means when the Government is doing it, they have to say: You know, I don't think your price is low enough so we are just not going to make that available to our people.

Did you know that a whole bunch of veterans are taking prescriptions under plan D because they can't get what they want under veterans? It is an interesting situation. When you negotiate these things, you change some of the dynamics and you do not make everything available. I don't think we in the United States are going to settle for just having some, although if we can tap the cheap one in Canada where they fix the price, that will lend an advantage to people in the United States. I am ready to admit that. I am ready to admit if we didn't have restrictions on ethanol and subsidies in this country, we would bring in a whole bunch of ethanol from Brazil. But we are going to protect the ethanol. Again, it is a different group of people who are talking about that than are talking about drug importation.

Let me get back to drug importation because that is important. The Senator from North Dakota several times--in fact, all the time--used to say ``where are all the dead Canadians'' when he was talking about safety. That is what my colleague from North Dakota used to come down to the Senate floor and say when he was talking about importation. He always asked that question. It may have escaped the notice of those of us in this body that he didn't ask that question anywhere in yesterday's debate or today's debate. Why not? Because two summers ago, five people in Hamilton, Ontario, died from taking counterfeit Norvasc. Norvasc is a blood pressure drug taken by millions upon millions of people who rely on it for their health and well-being. Since so many people take it, it is a target for counterfeiters looking to make a quick buck. I know he did say that counterfeiting is going to happen anyway. Probably. It happens in virtually every industry, and there are some countries that actually specialize in it. But imagine opening an opportunity for counterfeiters, an opportunity for them.

In the portions of the bill I have gotten through already, I know there are some pretty tight restrictions on who can be an exporter and who can be an importer and how packages will be labeled and all of those sorts of things. It is a marvelous effort to try to tighten it up so that what you buy is what you think you are getting. But how many of us, when the program was to first start, would know what to look for or even who to order from in order to be sure the drugs we are getting are safe? How do you do that? It is a tremendous opportunity for counterfeiters. We already have a problem with counterfeiters. There is no way you can write off the counterfeit argument.

I ask unanimous consent that I be able to show some three-dimensional objects on the Senate floor, the same as the Senator from North Dakota.

I will leave this on the desk so people can take a look at it. This is the Norvasc product with which the Canadians had a problem. It killed people. I want Members to take a look at the packaging. I have the external packaging. I have the internal packaging. I have the pills themselves. I challenge anybody to see the difference. We are going to put some special labels on anything that gets shipped into the country. I am sure nobody would ever be able to counterfeit any labels that were coming into the

country. It just couldn't happen. There are now dead Canadians, and it saddens me to say that I believe there will be even more. These unfortunate individuals got their fake pills from a brick-and-mortar pharmacy. If that is what is happening when you buy drugs in person in Canada, who knows what you might get when ordering from a Web site that says it is in Canada but could really be based anywhere in the world.

In fact, some of the drugs that have been intercepted by the FDA have come through Canada but actually were from Saudi Arabia. Communication worldwide is transparent these days. Whom you think you are ordering from is not always whom you are ordering from. Right now that practice is referred to as hiding the maple leaf.

I would like to invite my colleagues to visit with me when I am finished my remarks. I have these pills I would like them to take a look at. There are other examples, too.

So anybody who holds up two bottles and says, this one is this and this one is this, they can't be sure if the one that is being imported is really from the country they are talking about. It has to be a concern. That has to be tightened up. There have to be some ways people can really tell.

There is also a difference between whether you are importing for an individual or you are importing for a pharmacy. If you are importing for a pharmacy and they get a counterfeit load, it is not just one person who dies. It is the whole community, everybody who is taking that medication. So there needs to be some concern with these things.

As I said earlier, we all want to have affordable drugs. We would like to bring down the cost of medicine every way that we possibly can. But a counterfeit or tainted drug is unsafe at any price.

I want to add another thing on the counterfeit drugs. You can take the pills and you can grind them up and do a chemical analysis of one pill against the other, and they will come out identical. Now, part of the problem is the way you put these together to make them dissolve properly so what you need in your bloodstream gets into your bloodstream.

A number of the imported drugs that have been confiscated are shown they will not even dissolve. If you take a pill, and it goes completely through your whole system, you could die. It is a serious problem. It looks good, it even checks out good, but there are processes for putting these things together.

From my brief reading of the bill, I am also worried about some of the biologic information that may be in there that could be imported as well.

The Food and Drug Administration Revitalization Act is about restoring the trust of the American people in the FDA. That is where it belongs. We should have a lot of concern.

There is an amendment that is going to come up everybody is working on right now to make sure it would work, and it talks about some increased safety with food. Now, food, some of it, such as tomato packaging, is pretty well there. It is not put in another container. It is hard to fake. But there can be problems. We had problems with spinach in this country. We have a big problem with pet food right now, and it is because of China.

China--how much do you trust them with your drugs? We have been trusting them with our pet food, and they are killing our pets. It took a little thing called melamine that increases the protein count in the food. It does not increase the protein, it just increases the protein count. It makes it look like a much richer food than it is. Unfortunately, it kills. Unfortunately, they have not just been using it in pet food; they have it in their regular food chain, and children--young children--got it, and the children died. When they checked on it, they found out they died of starvation, even though they had what should have been a good protein diet. There was a little melamine in it, and it was starvation rather than poisoning.

But if they do that to food products, how much would we worry about drug products that come in from there? I know there are some limitations on where they can come from, but if they get into the European Union, there does not appear to be any constraint on it then, and it could be transferred on over to the United States. So throwing our borders open to drug importation would, instead, falsely place trust in criminals trafficking in illegal pharmaceuticals.

I think the American people deserve better. I hope we do not make this move at this point in time, and that we constrain the bill to those things we know will add safety to our pharmaceuticals and medical devices and things for children in this country.

I yield the floor.

Madam President, I thank the Senator from Illinois, Mr. Durbin, for his tremendous work and creativity and willingness to make revisions to his amendment so that we can clear up outstanding concerns or clarify outstanding concerns people might have had with it. I think we are at the point where that is the case. I would like to make a few comments on it myself.

Food safety is an issue that affects us all. It is not a partisan issue. We all want the safest food supply possible. It is, instead, our shared goal, a goal that requires cooperation and teamwork through a complicated process, and we have had that.

For many of us, the safety and reliability of our food system is something we all too often take for granted. Day by day, we consume our favorite beverages, enjoy a quick snack, or sit down to a meal at a local restaurant. We rely on a system of checks and balances that takes place behind the scenes that we are often unaware of until something goes wrong. Then and only then do we realize how dependent we are on the food safety system that is supported by the activities carried out by the Federal, State, and local government agencies, as well as by the food industry itself. Together, they inspect, test, research, and monitor our food supply from the farm or ranch where it is produced to the family dinner table where it is consumed. The type and amount of oversight they exercise depends on the food product, and the degree of regulatory scrutiny they demand is commensurate with the degree of risk.

In addition to these longstanding authorities and the activities of food safety, the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 required the Food and Drug Administration to register food processors, inspect their records, and detain adulterated food. It also requires the Food and Drug Administration to issue regulations to ensure the safety of imported foods.

Food safety has been making news lately. From E. coli in fresh spinach to salmonella in peanut butter to melamine-contaminated pet food, we hear a constant drumbeat of food safety problems.

The United States has one of the best food safety systems in the world, but even in the best of systems, there is room for improvement. Those improvements can take many forms. For example, we can address how food becomes contaminated in the first place, and we can make advances in the processing and handling of food. Our surveillance, testing, and reporting systems represent areas we should evaluate, as well as internal and external communications. Interagency cooperation and coordination between Federal and State officials is critical in identifying, tracking, and responding to outbreaks of foodborne illness.

The amendment offered by my colleague, Senator Durbin, contains several important elements in that response, but it is the beginning, not the end, of the process of food safety. This amendment does a number of important things. It establishes standards for pet food and sets up early-warning systems for any problems with pet food. The amendment improves communications systems about all food recalls, and it coordinates State and Federal activities on fresh and processed produce. Finally, the amendment creates a database of instances of adulterated food so that the FDA can better track patterns of problems and target its limited resources where they are most needed.

I am pleased we are able to work across party lines to develop an amendment today that we can all support, and I ask unanimous consent to be a cosponsor, along with Senator Allard.

However, there is much more work to be done. This amendment is a good first step on the road to a comprehensive response to food safety.

In March 2005, Senator Kennedy and I announced that we were working to develop a comprehensive response on another FDA issue, which is drug safety. The bill on the floor this week is a direct result of that announcement and

that pledge to work together. So when I pledge today to work to develop a comprehensive response on food safety, you can have some sense that I do mean that. I want my colleagues to work quickly and diligently to get this amendment to the point where we can accept it. I know we have it scheduled for a vote at the moment, too.

Madam President, I yield the floor.

I thank the Senator from Louisiana for his patience on this amendment, and also his understanding that he would work with my staff and the staff of Senator Kennedy to see what can be done to make our drug supply safer. I appreciate that.

I also thank him for all the efforts he has made on behalf of the Louisiana turtle farmers, which was a new industry to me--although they have been exporting turtles all over the world for years--for the work he did drafting and putting together a mechanism for eliminating salmonella in turtles so they can be, once again, pets in the United States.

The heart of the debate is how to construct a regulatory framework so that biologic drugs can be safely available under an accelerated pathway. It is more difficult to approve biosimilars than to approve generic versions of typical drugs. The balance we are trying to find is a compromise that promotes access with innovation, while also maintaining the high standards of safety at the Food and Drug Administration.

Biologics are complex molecules modeled after key processes occurring daily within the human body. One analogy is that if a typical drug was a 3 bedroom, 2 bath starter home, a biologic would be a skyscraper. The size, scope and complexity are completely different. The nomenclature is, too. As key scientists stated at our HELP Committee hearing on this topic, these are not generic biologics but biosimilars.

With many drugs, we can describe their structure with a high degree of precision--but not with follow-on biologics. You can't make an exact ``copy'' of a biologic, like you can for most typical generic drugs. For example, if I was to try to build the skyscraper of a biologic without the blueprints, as any generic company would need to do to create a follow-on biologic, I would have to ensure that every copy was identical or there could be fatal results.

Because of this, science must be an essential part of any safety standard.

One piece out of place would cause the entire structure to fall.

But to be clear, a safe pathway for an accelerated approval process for biologics, that also preserves innovation, is possible. It is not just me who believes it--the FDA, generic and pharmaceutical industries have all said so as well. I have been working across party lines with Senators Hatch, Kennedy and Clinton to develop legislation that does just that. Our staffs have been working tirelessly on this topic: individually meeting with experts and stakeholders; and as a group, talking with experts from the United States and global leaders. After all, we want the same end result--legislation that ensures medicines are safe and affordable, and that medical innovation continues to flourish.

I have a track record of working across party lines to build consensus and find common ground on tricky legislative issues. I know that with a little more time, and through regular order, we will develop a bipartisan package that accomplishes our common goals.

I concur with the chairman and am committed to moving a bipartisan bill through the HELP Committee in the near future with the goal that it can be joined with the conference on the FDA Revitalization Act.

Mr. President, I move to lay that motion on the table.

The motion to lay on the table was agreed to.

It might be helpful if I explained the provision you are discussing, as my office has received many calls as well and I believe the callers are not informed about this matter. Subtitle B of title II of S. 1028 establishes the Reagan-Udall Foundation for the Food and Drug Administration. That simple purpose of that nonprofit Foundation is to lead collaborations among the FDA, academic research institutions and industry designed to bolster research and development productivity, provide new tools for improving safety in regulated product evaluation, and in the long term make the development of those products more predictable and manageable.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I rise in support of the amendment that has been introduced by Senator Dorgan with whom I have joined as a cosponsor regarding drug importation.

First of all, I commend Senator Dorgan for his longstanding leadership and advocacy on this issue which has been for the better part of a decade. Regretfully, we are still at a point where we have been unable to pass legislation that would create a drug safety regime for drug importation.

That is the purpose of our amendment, Members of the Senate, as we today consider legislation to address an essential new function in how the FDA will finance the cost of reviewing new drugs; that is, the critical process of bringing new medications to market to Americans.

At the same time, this bill has directly raised a number of issues in how we assure that drugs are as safe as they should be, how we can bring new low-cost generic biologics to market. Key to this debate on this legislation that is pending before the Senate is the adage, which we have heard time and time again, that is: A drug which is not affordable is neither safe nor effective.

The simple fact is, even with the new Part D prescription drug benefit as part of the Medicare Program that has been in place for more than 2 years now, we still have at least 60 million Americans overall that today pay the full price of medications, have no help whatsoever because many have no health insurance or their insurance does not provide coverage for prescription drugs.

At the same time, the price that Americans are paying is the highest price in the world. For those of us who are fortunate to have prescription drug coverage, the estimated cost of medications is part of the major exorbitant increase in the cost of health care.

Many of my colleagues have recognized that our system lacks competition that would assure our constituents more affordable access to lifesaving medications. That is why I am very pleased to join with the Senator from North Dakota, and we have the support of a bipartisan group of colleagues in the Senate, along with Senators Grassley and Kennedy and Senators McCain and Stabenow who are unified with us in supporting this bipartisan approach.

Today, our voices echo those of 8 out of 10 Americans who are calling for safe importation. After nearly 3 years of awaiting Senate consideration of our legislation in 11 related hearings on this subject in the Senate, we simply must move forward. The reason is abundantly clear. We know the cost of health care is rapidly rising in America.

Prescription drug prices have contributed to that exorbitant increase. Compared to 1990, nearly twice as much of our health care dollar goes to medications. As the GAO has readily told us, the cost of prescription drugs commonly used by seniors has consistently increased at two to three times the rate of inflation, as indicated by this

chart, when you are comparing brand drugs, generics, and the CPI.

That is why we can no longer afford to postpone any action. We have acted before. We acted on legislation back in 2000. Then we also took action with respect to the Medicare Modernization Act in 2003 which created a Part D prescription drug program. We have found the requirements for the Secretary of Health and Human Services to certify the safety and savings of drug importation have blocked any action; it has become a roadblock to safe importation.

While FDA was unable to point to a single individual harmed by Canadian drugs--and in Europe, where they have had a track record of more than 30 years of parallel trading--it has proven that this trade can be conducted safely.

Time and time again, they have demonstrated that their process of parallel trading has worked without any harm to their consumers. Without a doubt, Americans would not be turning to imports if there was not substantial savings. Indeed, the CBO has told us that countries from which we would import under this bill would pay 35 to 55 percent less for a brand prescription drug. Let me repeat that--35 to 55 percent less than we pay today.

In other words, American consumers are paying 35 to 55 percent more than foreign consumers when it comes to medications. That is remarkable. We have seen so many objections to this legislation for the better part of a decade. That is why we have taken it upon ourselves to develop a regime that has been incorporated in this amendment and in our legislation that would address every facet, every issue that is associated with safety in order to allow drug importation to occur.

As I said earlier, the European Union has already engaged in parallel trading for three decades without incident. As seen here on this chart, where we have incorporated 31 different key safety provisions in our legislation, and compare that to the Medicare Modernization Act that passed in 2003 that created the Part D prescription drug benefit to the Medicare Program, only 6 provisions that related to safety were incorporated in that landmark initiative.

We include 31 different initiatives to address every single safety- related issue that has emerged in this debate. Whether it has been on the floor of the Senate, whether it has been in the course of hearings or elsewhere, we have addressed every safety-related issue to create a regime that should create the assurance that this can be done safely and without harm to Americans so they can benefit from lower priced medications.

Americans deserve to have the lower priced medications. The FDA can conduct this program. They can conduct this regime. They should work proactively to assure these drugs are safe. We give them the means and the wherewithal and the resources in order to accomplish this. We comprehensively address the various concerns that have been raised months and years about drug importation so we can get something done.

People say: Well, let's just certify safety. Well, as I have said earlier, it is a roadblock. It is an impediment to get anything done. It essentially becomes the poison pill. We have tried certification. We have given the Secretary of Health and Human Services under two administrations--this administration and the previous administration-- the ability to do that, to certify it. They are unwilling to do so because they have said they do not have the resources, they do not have the means.

Well, we are giving them the means and the resources. But to pass another amendment that simply calls for the Secretary of Health and Human Services to certify drug importation is a roadblock. It is a road to nowhere with respect to this initiative. That is why Senator Dorgan and I took a different route.

We address all the safety questions. We do not certify to ensure safety, we take action with these provisions. What we do is employ the measures to actually make drug importation safe.

Opponents claim importation will cause harm. But they fail to note that the greatest threat to the safety of Americans is the inability to take a drug as it is prescribed. That exacts a toll on thousands, if not millions, of Americans each and every year, not to mention lives lost.

Some say Americans would receive drugs from illegitimate sources, but under our legislation, Americans will receive imported drugs from 32 countries with high standards. In most cases Americans will purchase an imported prescription drug from their local pharmacies just as they do today. The pharmacies will receive these drugs from the U.S. wholesalers which import them. These wholesalers will have been registered. They will be inspected. They will be monitored by the FDA. This higher level of safety is also a first step in establishing a higher standard for handling of prescription drugs right here in the United States where we have had the preponderance of problems.

Our legislation allows individuals to directly order medications using an FDA-registered and approved Canadian pharmacy. Again, just as with wholesalers handling prescription drugs, the FDA will examine, register, and inspect these facilities on a frequent basis. The FDA will assure the highest standards for such functions as making sure the medical history is recorded of the individual, verifying prescriptions, and tracking the shipments.

Some say consumers will get medications they should not be getting. Regardless of whether one purchases imported drugs from the local pharmacist or uses a Canadian pharmacy, we assure that a legitimate prescription and a qualified pharmacist will be vital ingredients to ensuring safety. In fact, we have many standards incorporated in this legislation in which it would occur.

We adopted language that had been introduced by the Senator from California, Mrs. Feinstein, with respect to Web sites and domestic Internet pharmacies so that we assure that properly licensed pharmacies and pharmacists are behind Web sites that are offering these medications.

Some say importation will allow unapproved drugs to enter the United States. Again, on that point, our legislation is abundantly clear. Every drug received will always be FDA-approved. If any difference exists in a foreign drug, even the most minute, our legislation assures FDA will evaluate the product and determine its acceptability. If the drug is not bioequivalent to a U.S. drug, the Secretary may reject approval of that medication.

Some say we will import counterfeits. The truth is, today the FDA does not know even the level of domestic counterfeiting where, as I said earlier, the preponderance of the problem exists. It is simply not employing the very anticounterfeiting technologies which our legislation demands in order to ensure that we protect against the threat of counterfeits. The fact is, we employ technologies today like the ones we use now for twenty-dollar bills. We can use the same for prescription drugs.

Moreover, this bill supports development of future anticounterfeiting and track-and-trace technologies, very effective methods which we hope will be used to protect all drugs. For those who say consumers would not know who has handled the imported prescription drug, again, our bill requires a chain of custody, a pedigree to be maintained and inspected to help ensure the integrity of imported medications. A pedigree for prescription drugs was mandated, believe it or not, by law in 1988 and still has not been implemented by the FDA. Under our legislation, at last we will require pedigrees to be implemented for all medications.

Some opponents will even attempt to alarm Americans about the countries from which we import drugs, citing Latvia, Estonia, Slovakia, and members of the European Union. But consider that another member is Ireland where Lipitor is made. Again, I call your attention to this chart which indicates the European Union and other countries from which we import drugs designated in blue. They either meet our standards or have even higher ones, ones as you can see in this chart, all of the blue countries from which we would import. They have our standards or they exceed our standards.

In contrast, this chart denotes the countries in red from which, again, our manufacturers import medications. That is interesting. The FDA inspects pharmaceutical manufacturing plants in these countries denoted in red. These are countries from which manufacturers will import products. It includes China, India, Bulgaria, Jordan,

and other countries. In fact, they have lower standards. So what I have indicated, based on what this map shows, is that we have the blue countries from which we would allow importation of drugs that would be FDA-approved, facilities inspected, documented. We would have pedigrees and technologies to track the shipments. These are countries that meet or exceed our standards. Today we already have FDA pharmaceutical manufacturing plants in these countries in red that, in fact, have lower standards. So we already, amazingly enough, allow medications to come in from countries that have lower standards. Why do we? Because they are inspected by FDA. So the same process can't work for countries that meet or exceed our standards already, that already have a track record in parallel trading in and amongst their own countries, and we can't do it today for those countries when FDA already does it for other countries that have lower standards? Because that is where many of our medications are manufactured. That is where our manufacturers import and FDA inspects those facilities before those medications enter the United States. So this is already done. It is done with countries that have lower standards, and we find that acceptable. Yet we say we are not finding it acceptable from countries that already have a track record of parallel trading amongst their own country without injury to any of their consumers over the last 30 years that meet or exceed our standards. It simply doesn't make sense.

We are setting a model for improving safety because we are saying we are going to create 36 different measures for establishing safety for the American consumer to assure all those concerned that we have the measures in place and the resources with which to do it. So to those who say importation is unsafe, we show them how it shall be safe under our legislation. It sets a model and a standard.

Some say consumers will not see significant savings. But drugs imported under this program will be labeled as imports so consumers will have the opportunity to do some comparative shopping. They will be able to take those prices and do a side-by-side comparison between the imports and those medications they buy in the United States. Consumers have become well aware of foreign pricing and the competition that exists between imported and wholesalers. We know they will achieve consumer savings; there is no question. That is why so many Americans, including many of my constituents from the State of Maine who have been able to access medications from Canada, have had to take bus trip after bus trip. They have been compelled to do that in order to achieve savings because of our unwillingness to address this issue in the Senate and the overall Congress. This legislation should have been accomplished a long time ago.

In terms of savings, it should be interesting to note the independent analysis of the Congressional Budget Office which has confirmed that the savings, indeed, should be substantial--not surprising. It would be very substantial, indeed. They estimate a 10-year direct savings alone of $50 billion to the American consumer--$50 billion. That is probably on the conservative side. The Federal Government stands to save $6.1 billion in the Medicare and Medicaid Programs alone. This is only the savings that CBO projected from purchases of imports. With increased competition in our markets, we could indeed save more, having competition, having the pharmaceutical industry have some competition in their pricing. Understand, individuals can't import medications. Pharmacists can't import medications. Only manufacturers can. So we are saying: Let's set a standard. Let's allow imports that benefit the individual consumer with safety-related provisions put in place.

In fact, in a recent Commerce Committee subcommittee hearing, we had the opportunity to hear from a number of experts. We heard from a pharmaceutical economist who estimated that importation could result in a 12- to 20-percent reduction in domestic drug costs. That is an annual savings, not over 10 years, of up to $40 billion per year, as competition is created for consumer savings. So as a direct result of the competition that would develop as a result of importation, consumers alone could save up to $40 billion a year.

So at a time when health care spending is reaching 16 percent of GDP and is climbing, this competition is an imperative. It is central. It is central to the consumer who is facing double-digit increases in prescription drugs. Prescription drugs are not getting cheaper in America. They are getting more expensive. As I said, the American consumer is spending 35 to 55 percent more than the foreign consumer. Health care spending is 16 percent of the GDP. Much of the increase in health care spending is attributed to the rising cost in prescription drugs.

So that is why this becomes all the more important to the American consumer and, indeed, to the Federal Government that will save $50 billion over 10 years and 6 billion alone in Medicare and Medicaid spending. That is important to our own interests and to our budgetary concerns about the growth in these respective programs.

Some have argued that we haven't provided the resources necessary to run an importation program. But we have established a means of financing, a small fee based on the value of imported drugs which will now be set at a cap of 2.5 percent. We have always agreed that the FDA should have adequate resources. In fact, we heard from previous Secretaries of Health and Human Services, we don't have the resources to certify safety. So now we are providing a certification for that by including this cap of 2.5 percent for a fee on the total import of medications. This is what CBO has indicated to us would be necessary in order to accomplish and implement these safety-related measures. We think it is important the FDA have the resources that are essential for regulation, for monitoring inspections of both domestic wholesalers, who would import the prescription drugs, as well as the Canadian pharmacies from which American consumers could order.

Some say our bill is intended to adopt Canadian prices. Again, quite the contrary. We open importation to 32 countries which meet our safety standards. We are not simply adopting the price of another country. Rather, we are purchasing in a world market. That is a critical point. We are allowing American consumers to benefit from worldwide prices because of the competition that would be allowed. Obviously, something is happening in other countries where we want to import these medications because they are paying 35 to 55 percent less than American consumers. Why should that be the case? These are countries, by the way, that meet or exceed our standards when it comes to drug safety. Yet American consumers are paying 35 to 55 percent more for the same medications.

Some say we compel manufacturers to sell the product. But our bill is very clear on that specific point. We never compel any manufacturer to sell any particular product. But when a manufacturer chooses to sell product, the bipartisan bill prohibits discriminatory acts against pharmacists and wholesalers who sell these medications. Those actions have reduced supplies of essential drugs for some Americans, at peril to their health.

We are saying they cannot take action that discriminates against a pharmacy because they have sold those drugs to an American consumer. They are not penalized because their supplies are cut off by the manufacturer as a means of punishment and discrimination.

Now, some say importation will threaten research and development. But the fact is, manufacturers will invest just as other industries do, in order to develop innovative products and remain competitive. The taxpayer is a partner in that investment. The American taxpayer is a partner. The taxpayer makes investments in research and development. In fact, we fund nearly $30 billion a year to do basic and applied research at the National Institutes of Health alone--$30 billion.

So as you can see on this chart, as to R&D spending from all the companies, we--the United States consumer and taxpayer--fund and underwrite much of their research and development.

As I said earlier, other industrialized countries pay 35 to 55 percent less for their drugs. But because of the higher prices Americans pay for their medications, the American consumer ends up

paying $99 billion more for their prescription drugs each year than otherwise would be the case. Let me repeat that. Because we pay 35 to 55 percent more than foreign consumers, American consumers end up paying $99 billion more for their medications.

With all that additional profit, the industry spends about $9 billion more on research and development than they do in Europe. That is 10 cents return on the dollar for all that added profit margin. So while the American consumers spend $99 billion more for their prescription drugs than foreign consumers, in Europe, for example, American pharmaceuticals spend only $9 billion more--from that $99 billion--on research and development than they do in Europe. We spend only $9 billion more here than they do in Europe on research and development. That means American pharmaceuticals are netting $90 billion more, that they are only investing $9 billion more in research and development.

So it is not undercutting their ability for research and development, not to also mention, by the way, the American taxpayer invests more than $30 billion at the National Institutes of Health alone for basic research as well.

In fact, if you look at the R&D spending of the largest pharmaceutical firms--as indicated again by this chart--it is not markedly different from many other firms. If you look at other firms, such as Intel, Microsoft, Lucent, and others with high research and development costs and relatively low production costs, their research and development spending averages about 14.3 percent of gross revenues--not much different--yet their products are highly competitive, very competitive. You have seen the software, cell phones, computers, laptops, whatever. You have seen the very competitive pricing today, yet they make an investment of 14.3 percent for research and development as a percentage of their gross revenues.

Yet, paying the world's highest prices for drugs does not ensure additional research, but it certainly does decrease access to drugs. So while they do not invest in considerably more research and development--since we pay $99 billion more in prices for prescription medications, and they only spend $9 billion more on research and development, and the taxpayer spends $30 billion at NIH alone, as I indicated; but even, comparatively speaking, it is 14.4 percent of their gross revenues that are invested in research and development--if you compare that to, as I said, Intel, Microsoft, Lucent, and other companies, which is 14.3 percent, you find more competitive products in the technology arena. Their prices are coming down. The American consumer is not benefiting from the investments that are being made by the pharmaceuticals, yet it is a highly profitable industry. So we are not seeing the same benefits that would yield lower prices for the American consumer.

Now, in conclusion, let me say, I hope this Senate will adopt this amendment that creates the kind of safety regime that would ensure drug importation will become a reality. Simply certifying safety on the part of the Secretary of Health and Human Services has been tried and yet has never accomplished that goal. It has been an impediment to drug importation. It has occurred twice in the last 10 years, and for whatever reasons the Secretaries in the previous administration and this administration have concluded they will not certify the safety regime because there has been no safety regime. It could be done, but it has not been done through the agencies. FDA could do it. It has not accomplished it. It has not implemented it. It has not had the impetus to pursue it. That is why we have taken it a step further. This legislation has been examined, reexamined, based on the concerns that have been expressed by those who have been opposed to it in the past saying they have concern about safety.

We understand that. So we have gone a step further and incorporated every safety-related measure possible that is achievable, measurable, and provide the FDA with the resources to accomplish it.

The Senate has voiced its view to provide market access on this issue on many occasions, even by virtue of passing the certification standard. Obviously, I think there has been an indication on the part of the Senate to support some type of initiative that allows for drug importation. But we want to mitigate the concerns that have been expressed repeatedly about the issues of safety by incorporating all of those measures in this amendment that is pending before the Senate.

In fact, 68 Members of this body voted to adopt the amendment that was offered by the Senator from Louisiana, Mr. Vitter, to the Homeland Security appropriations bill. But we need more than to simply allow importation. We must provide an effective framework that will address the concerns that will ultimately ensure the safety of our consumers.

Sixty-eight Members of this body supported blocking the Customs agency from banning drug importation, so it is obvious Members of this Senate truly want to pass a measure that will allow for drug importation. That is why I think this legislation logically affords us the ability to provide the safety and, at the same time, allow consumers in America to benefit from competition, from lower prices, based on the track record and the experience of other countries that have been adopting this approach for many decades.

Competition is what is missing in this process. It will work for the consumer. To date, the process has not worked for the consumer where they have benefited from lower prices for medications because there has been no competition. Competition has been virtually absent. I note the comment of the former Pfizer CEO, Hank McKinnell, who wrote:

Competition is good medicine for economies. . . . Name an

industry in which competition is allowed to flourish--

computers, telecommunications, small package shipping,

retailing, entertainment--and I'll show you lower prices,

higher quality, more innovation, and better customer service.

There's nary an exception. Okay, there's one. So far the

healthcare industry seems immune to the discipline of

competition.

Those are the words of the former Pfizer CEO, Hank McKinnell.

It is indeed time to make competition work to benefit consumers and taxpayers. Americans deserve and will seek out affordable life- sustaining medications. We must assure that access is safe. That is what we accomplish in this amendment that is pending before the Senate.

Again, I thank my colleague from North Dakota, Senator Dorgan, for his leadership on this question and for all those who are supporting this initiative.

Mr. President, I yield the floor.