H.R. 3546 — Prescription Drug Price Relief Act of 2025

This section requires the Secretary to establish, not later than 30 days after enactment, a process to review all brand name drugs not less frequently than once per calendar year to determine whether the price of each such drug is excessive. The Secretary must deem a drug's price excessive if its domestic average manufacturer price exceeds the median price charged for the drug in at least three of five reference countries (Canada, the United Kingdom, Germany, France, and Japan), considering additional factors; or, if not, if the price is higher than reasonable based on factors including (1) affected patient population size, (2) drug value to patients and relation to therapeutic benefits and access, (3) risk-adjusted federal subsidies and investments, (4) development costs, (5) significant health outcome improvements over prior therapies, (6) cumulative global revenues, (7) domestic price increases exceeding quarterly CPI-U increases, and (8) other appropriate factors. This section further authorizes any person to petition the Secretary, consistent with APA procedures, for an excessive price determination under the multifactor test; requires a response within 90 days by making the determination or publicly declining with reasons (not more frequently than once per calendar year per drug); and requires public posting of petitions, documentation, and determinations, including on the database established under section 5.

This section requires the Secretary, for any brand name drug determined to have an excessive price under section 2, to (1) waive or void government-granted exclusivities effective on the date of such determination; and (2) grant open, non-exclusive licenses to any person to manufacture, use, offer to sell or sell, or import the drug and rely on its regulatory test data in accordance with section 4. (Thus, this enables generic and biosimilar competition by ending the brand name drug's market exclusivity.) It further directs the Secretary to prioritize and complete review of any generic drug or biosimilar biological product application referencing such a licensed drug within eight months. It also authorizes the Secretary to file civil actions against the manufacturer of an excessively priced drug for any price increase from the determination date until licensed manufacturing begins, seeking damages of at least the revenue from such increase, with district courts empowered to grant injunctive relief and compensatory damages.

This section requires an entity accepting an open, non-exclusive license under section 3(a)(2)—for a drug whose government-granted exclusivity was terminated under section 3(a)(1)—to pay a reasonable royalty to the holder of a relevant patent, new drug application (21 U.S.C. 355(c)), or biologics license application (42 U.S.C. 262(a)). The royalty rate is either (1) a percentage of sales no higher than the average royalty rate from Internal Revenue Service data on pharmaceutical manufacturer federal income tax returns or (2) an amount determined by the Secretary of Health and Human Services based on factors including the drug's value to patients, affected patient population size, federal subsidies and investments, health outcome improvements over prior therapies, and manufacturer recovery of risk-adjusted investments. Royalties must support affordable pricing for all purchasers without enabling sales at an excessive price under section 2; must be divided among multiple patent holders or investors by agreement or Secretary determination; and require the licensee to sell the drug below the excessive price determined under section 2(b).

This section directs the Secretary of Health and Human Services to establish and maintain a public database of brand name drugs and excessive price determinations under section 2 of the Act. For each such drug and applicable calendar year, the database must include, at a minimum: (1) the drug name and manufacturer; (2) whether the drug was determined under section 2(b) to have an excessive price; (3) the number of petitions received under section 2(c), with related information; (4) the number of open, non-exclusive licenses granted under section 3(a)(2) for generic drug or biosimilar biological product versions of the drug; and (5) the number of applications under subsection (b)(2) or (j) of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or section 351(k) of the Public Health Service Act (42 U.S.C. 262(k))—i.e., abbreviated new drug applications (ANDAs), 505(b)(2) applications, and biosimilar applications—submitted and approved pursuant to such licenses. With respect to determinations under section 2(b)(1), the Secretary must publish such information within 30 days of receiving domestic and international pricing data under section 6. This section also requires the Secretary to submit annual reports to Congress—beginning 60 days after the first excessive price review under section 2—summarizing the prior year's reviews, including the total number of drugs reviewed and determined excessively priced (by type under section 2(b) and by manufacturer), the average extent prices exceeded reasonable levels, the number of licenses granted, generic/biosimilar applications received and approved (with median approval times), petitions received, non-reporting manufacturers, and other data as appropriate. The database and reports must be publicly available on the FDA website in an easily accessible format.

This section requires each manufacturer to submit to the Secretary an annual report, in a format specified by the Secretary, for each brand name drug covering the previous calendar year. The report must include (1) the average manufacturer price and wholesale acquisition cost of the drug in the United States and reference countries for the year and by quarter; (2) cumulative global revenues and annual net sales revenues in the United States and reference countries for the year and by quarter; (3) total domestic and foreign research and development expenditures related to the drug, itemized by basic and preclinical research, clinical research by trial, alternative dosage forms, other development activities, supplemental applications under 21 U.S.C. 355, and postmarket requirements under 21 U.S.C. 355(o)(3); (4) domestic and foreign marketing and advertising expenditures; (5) investments in human clinical trials by trial and year, including grants, contracts, tax incentives, and public subsidies; (6) the estimated size of the affected patient population; (7) manufacturer-provided information on drug pricing decisions; and (8) additional information as determined by the Secretary. Applicable manufacturers must submit reports by January 15 of the year following enactment and annually thereafter. This section imposes civil monetary penalties on manufacturers for untimely submission or knowingly false information, equal to 0.5% to 1% (as determined by the Secretary) of the drug's prior-year gross sales revenues multiplied by the number of days late, in addition to other penalties; collected funds support National Institutes of Health competitive research grant programs.

This section prohibits manufacturers from engaging in anticompetitive behavior violating section 5(a) of the Federal Trade Commission Act (15 U.S.C. 45(a)) (i.e., unfair methods of competition in or affecting commerce) with another manufacturer if such behavior interferes with the issuance or implementation of open, non-exclusive licenses under this Act or contravenes the public interest in the availability of affordable prescription drugs.

This section defines the following terms for purposes of the Act: (1) average manufacturer price, generally as defined in Social Security Act section 1927(k)(1) or, if inapplicable, wholesale acquisition cost under Social Security Act section 1847A(c)(6)(B), and for reference countries based on the drug price there; (2) biosimilar biological product, as licensed under Public Health Service Act section 351(k); (3) brand name drug, as approved under Federal Food, Drug, and Cosmetic Act (FDCA) section 505(b)(1) or Public Health Service Act section 351(a), subject to FDCA section 503(b)(1), and claimed in a patent or with a patented use; (4) generic drug, as approved under FDCA section 505(b)(2) or (j); (5) government-granted exclusivity, as specified statutory prohibitions on competing drug applications (e.g., FDCA sections 505(c)(3)(E)(ii)-(v), 505(j)(5)(B)(iv), 505A, 505E, 527; Public Health Service Act section 351(k)(7)); (6) manufacturer, as holder of an approved new drug application under FDCA section 505 or biologics license under Public Health Service Act section 351; (7) open, non-exclusive license, as authorizing any person to use patents or regulatory data for a brand name drug; and (8) Secretary, as the Secretary of Health and Human Services.