S. 1407 — ABC Safe Drug Act

This section restricts purchases of drugs by the Department of Health and Human Services, Department of Veterans Affairs, Department of Defense, and other federal health care programs (as defined in section 1128B(f) of the Social Security Act)—beginning January 1, 2028, to only those drugs for which 60% or more of active pharmaceutical ingredients are manufactured in countries other than the People's Republic of China that meet Food and Drug Administration health and safety standards, and beginning January 1, 2030, to only those drugs for which 100% of such ingredients are so manufactured. The HHS Secretary may waive these requirements for agencies or programs unable to comply, but no waivers are permitted for drugs purchased on or after January 1, 2031. This section further amends section 502 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 352) to deem a drug misbranded if its labeling does not specify the country of origin of each active ingredient. (Thus, the FDA may pursue enforcement actions, such as seizures or injunctions, against noncompliant drugs.)

This section provides temporary 100% bonus depreciation under section 168(k) of the Internal Revenue Code for qualified pharmaceutical and medical device manufacturing property placed in service after December 31, 2024, and before January 1, 2031 (i.e., through 2030). Qualified property includes tangible property placed in service in the United States as part of the construction or expansion of facilities manufacturing drugs (as defined in 21 U.S.C. 321(g)) or medical devices (as defined in 21 U.S.C. 321(h)).