,,ii  #aag? ,,congress  #a/ ,session    
,s4 #bbeg  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,june #bd1 #bjba,ms4   
,ros5 introduc$ ! foll[+ bill2 :i* 0    
read twice & ref]r$ to ! ,committee on  
,f9ance  ,a ,,bill  ,to provide ,f$]al  
support = nonpr(it g5]ic & ess5tial     
m$ic9e & device manufactur]s to increase
 ! availability ( drugs & devices 9 ord]
 to r$uce drug or device %ortages & drug
 & device co/s4  #a4 ,%ort title ,?is   
,act may be cit$ z ! ,exp&+ ,access to  
,af=dable ,prescription ,drugs & ,m$ical
 ,devices ,act4  #b4 ,support+ nonpr(it 
g5]ic & ess5tial m$ic9es & device       
manufactur]s  7a7 ,9 g5]al ,"p ,p (     
title ,,iii ( ! ,public ,heal? ,s]vice  
,act 7#db ,u4,s4,c4 #bhj;g et seq47 is  
am5d$ by add+ at ! end ! foll[+3        
#cii,v-#g4 ,support+ nonpr(it g5]ic &   
ess5tial m$ic9es & device manufactur]s  
7a7 ,9 g5]al ,! ,secret>y %all aw>d     
coop]ative agreem5ts & l[ int]e/ revolv+
 loans to1 & waive us] fees ) respect   
to1 nonpr(it entities to support !      

manufacture & di/ribution )9 ! ,unit$   
,/ates ( eligible drugs & eligible      
devices4  7b7 ,t]ms ( coop]ative        
agreem5ts & loans  7#a7 ,coop]ative     
agreem5ts  7,a7 ,initial aw>ds ,ea*     
coop]ative agreem5t aw>d$ "u ?is section
 %all be = an initial p]iod det]m9$ by !
 ,secret>y1 n to exce$ #e ye>s1 & %all  
be 9 an am\nt det]m9$ by ! ,secret>y1 n 
to exce$ #e1jjj1jjj4  7,b7 ,subsequ5t   
aw>ds ,an entity receiv+ a coop]ative   
agreem5t "u ?is section may apply =     
additional aw>ds ) respect to o!r       
eligible drugs or eligible devices "u   
?is subsection4 ,! ,secret>y may aw>d   
additional coop]ative agreem5ts to su*  
entities1 = p]iods n to exce$ #e ye>s1 9
 am\nts n to exce$ #e1jjj1jjj4  7,c7    
,ext5sions ,! ,secret>y may ext5d !     
initial "t p]iod ( a coop]ative agreem5t
 aw>d$ "u subp>agraph 7,a7 or 7,b71 b ! 
total aw>d am\nt ( ! orig9al aw>d plus  
any ext5sion may n exce$ #e1jjj1jjj4    
7#b7 ,l[ int]e/ revolv+ loans ,ea* loan 
aw>d$ "u ?is section %all be = a p]iod  

det]m9$ by ! ,secret>y1 ) an int]e/ rate
 n great] ?an ! ,f$]al ,res]ve b5*m>k   
int]e/ rate plus #c p]c5t1 & 9 an am\nt 
n great] ?an #e1jjj1jjj4  7c7           
,applications  7#a7 ,9 g5]al ,to be     
eligible to receive a coop]ative        
agreem5t or loan "u ?is section1 an     
entity %all-- 7,a7 be an organization   
t-- 7i7 manufactures1 or facilitates !  
manufacture (1 f9i%$ drug products or   
devices 9 ! ,unit$ ,/ates2  7ii7 is an  
organization describ$ 9 p>agraph 7#c7 or
 7#d7 ( section #eja7;c7 ( ! ,int]nal   
,rev5ue ,code ( #aihf & exempt f tax "u 
section #eja7;a7 ( su* ,code2 &  7iii7  
is bas$ 9 ! ,unit$ ,/ates2  7,b7        
demon/rate exp]tise 9 ! process ( drug  
or device manufactur+1 & ! ability to   
fully comply ) all applicable ,/ate &   
,f$]al requirem5ts2  7,c7 agree to      
ensure t-- 7i7 ! highe/ total           
comp5sation (f]$ to any employee ( su*  
entity is n m ?an #dj times great] ?an !
 total comp5sation (f]$ to !            
l[e/-comp5sat$ employee1 includ+ any    

self-employ$ indep5d5t contract$ work]s 
on an h\rly wage1 ( su* entity2  7ii7   
among drugs t may be self-adm9i/]$ by   
pati5ts & rema9+ aft] application (     
clause 7iii71 o!r ?an su* drugs t are n 
requir$ to be di/ribut$ ?r\gh           
ph>macies-- 7,i7 ! entity %all report to
 ! ,secret>y on an annual basis any     
b>ri]s fac$ 9 mak+ ! drug widely        
available ?r\gh retail ph>macies2 &     
7,,ii7 ! entity %all1 on an annual basis
 & 9 a mann] prescrib$ by ! ,secret>y1  
make publicly available complete        
in=mation on ! availability ( ! drug f  
retail ph>macies2 &  7iii7 if !         
,secret>y id5tifies a ne$ to supplem5t !
 /rategic national /ockpile "u section  
#cai;,f-#b1 ! ,secret>y has priority    
access to pur*ase1 at ! av]age co/ price
 (f]$ to o!r pur*as]s1 a quantity ( !   
drug or device equival5t to at lea/ #be 
p]c5t ( ! entity's production1 or su*   
p]c5tage ( su* supply z ! ,secret>y1 9  
consultation ) ! entity1 det]m9es       
appropriate1 consi/5t ) public heal?    

ne$s1 until ! ne$ has be5 met2  7,d7    
include a timel9e = any drugs or devices
 manufactur$ by ! entity t are expect$  
to come to m>ket )9 ! duration ( !      
coop]ative agreem5t or loan1 ) at lea/  
"o su* drug or device expect$ to come to
 m>ket )9 #e ye>s ( />t+ ! coop]ative   
agreem5t or loan2 &  7,e7 submit an     
application at su* "t1 9 su* mann]1 &   
conta9+ su* additional in=mation z !    
,secret>y may require4  7#b7 ,priority  
,9 aw>d+ coop]ative agreem5ts & loans "u
 ?is section1 ! ,secret>y %all give     
priority to applications f entities t   
are expect$ to manufacture & take to    
m>ket eligible drugs or eligible devices
 at a price t is l[] ?an exi/+ treatm5ts
 = ! same disease or condition t su*    
drug or device is int5d$ to treat1 or to
 entities t are expect$ to manufacture  
any eligible drug or eligible device    
id5tifi$ z a public heal? priority by ! 
,secret>y4  7#c7 ,calculation ( wages ,=
 purposes ( p>agraph 7#a77;,c77i7 to    
calculate employee comp5sation ) respect

 to "p-"t employees1 ! ,secret>y %all   
calculate ! comp5sation su* employees   
w\ld receive if !y 7 to "w full-"t at _!
 exi/+ h\rly wages4  7#d7 ,report ,!    
,secret>y %all report to ,congress      
annually reg>d+ b>ri]s report$ by       
entities reg>d+ availability ( drugs    
describ$ 9 p>agraph 7#a77;,c77ii7 7o!r  
?an su* drugs t are n requir$ to be     
di/ribut$ ?r\gh ph>macies7 ?r\gh retail 
ph>macies & regulatory or legislative   
recomm5dations to improve public access 
to su* drugs4  7d7 ,def9itions ,=       
purposes ( ?is section-- 7#a7 ! t]m     
eligible device means a device-- 7,a7   
7i7 t is approv$ "u section #eae ( !    
,f$]al ,food1 ,drug1 & ,cosmetic ,act1  
cle>$ "u section #eaj7k7 ( su* ,act1 or 
au?oriz$ "u section #eac7;f77#b7 ( su*  
,act2  7ii7 = :i* ! device manufactur]  
apply+ = a coop]ative agreem5t "u       
subsection 7a7 or a l[ int]e/ revolv+   
loan "u subsection 7b7 has submitt$ an  
application "u section #eae ( ! ,f$]al  
,food1 ,drug1 & ,cosmetic ,act1 or a    

notification "u section #eaj7k7 or      
#eac7;f77#b7 ( su* ,act2 or  7iii7 t is 
urg5tly ne$$ to meet a public heal? ne$1
 z det]m9$ by ! ,secret>y1 & = :i* !    
device manufactur] apply+ = a coop]ative
 agreem5t "u subsection 7a7 or a l[     
int]e/ revolv+ loan "u subsection 7b7   
has provid$ a timel9e = submission ( an 
application "u section #eae ( ! ,f$]al  
,food1 ,drug1 & ,cosmetic ,act1 or a    
notification "u section #eaj7k7 or      
#eac7;f77#b7 ( su* ,act2 &  7,b7 t !    
,secret>y has deem$ ess5tial on ! basis 
(-- 7i7 !re be+ #b or few] active       
manufactur]s ( ! device or a            
sub/antially simil> device2  7ii7 !     
device hav+ be5 on ! device %ortage li/ 
"u section #ejf;,j7g7 ( ! ,f$]al ,food1 
,drug1 & ,cosmetic ,act at any "t 9 !   
pa/ #e ye>s2  7iii7 simil> devices h    
increas$ 9 co/ m ?an ! rate ( inflation 
ov] ! mo/ rec5t #e-ye> p]iod2  7iv7 !   
device meet+ an o!rwise unmet critical  
public heal? ne$2 or  7v7 o!r factors1 z
 det]m9$ by ! ,secret>y2 &  7#b7 ! t]m  

eligible drug means a drug-- 7,a7 7i7 t 
is approv$ by ! ,food & ,drug           
,adm9i/ration "u section #eje ( ! ,f$]al
 ,food1 ,drug1 & ,cosmetic ,act or      
lic5s$ "u section #cea ( ?is ,act2  7ii7
 = :i* ! drug manufactur] apply+ = a    
coop]ative agreem5t "u subsection 7a7 or
 a l[ int]e/ revolv+ loan "u subsection 
7b7 has submitt$ an application "u      
subsection 7b77#b7 or 7j7 ( section #eje
 ( ! ,f$]al ,food1 ,drug1 & ,cosmetic   
,act or "u section #cea7k7 ( ?is ,act2  
or  7iii7 t is urg5tly ne$$ to meet a   
public heal? ne$1 z det]m9$ by !        
,secret>y1 & = :i* ! drug manufactur]   
apply+ = a coop]ative agreem5t "u       
subsection 7a7 or a l[ int]e/ revolv+   
loan "u subsection 7b7 has provid$ a    
timel9e = submission ( an application "u
 subsection 7b7 or 7j7 ( section #eje ( 
! ,f$]al ,food1 ,drug1 & ,cosmetic ,act 
or "u subsection 7a7 or 7k7 ( section   
#cea ( ?is ,act2 &  7,b7 t ! ,secret>y  
has deem$ ess5tial on ! basis (-- 7i7   
!re be+ #b or few] active manufactur]s (

 ! drug2  7ii7 ! drug hav+ be5 on ! drug
 %ortage li/ "u section #ejf;,e ( !     
,f$]al ,food1 ,drug1 & ,cosmetic ,act at
 any "t 9 ! pa/ #e ye>s2  7iii7         
alt]native treatm5ts = ! disease or     
condition ! drug is int5d$ to treat co/+
 m ?an #ej p] #a-mon? supply accord+ to 
! public li/ price2  7iv7 ! drug meet+  
an o!rwise unmet critical public heal?  
ne$2 or  7v7 o!r purposes1 z det]m9$ by 
! ,secret>y4  7e7 ,use ( funds ,a       
recipi5t ( an aw>d "u ?is section may   
use funds = />t-up1 rese>* & developm5t1
 or expansion co/s associat$ ) !        
manufacture ( eligible drugs or eligible
 devices1 9 accordance ) ! t]ms ( !     
applicable coop]ative agreem5t or loan4 
7f7 ,report ,n lat] ?an #c ye>s aft] !  
date ( enactm5t ( ! ,exp&+ ,access to   
,af=dable ,prescription ,drugs & ,m$ical
 ,devices ,act & annually !reaft]1 !    
,secret>y %all submit a report to       
,congress on1 ) respect to ! applicable 
report+ p]iod-- 7#a7 ! numb] ( grants & 
loans aw>d$ "u ! program2  7#b7 ! drugs 

& devices t came to m>ket ) support f   
grants or loans "u ! program2  7#c7 a   
co/-sav+s analysis = all f$]ally-fund$  
heal? programs1 bas$ on sav+s t 7       
realiz$ due to a drug or device ^:      
manufactur] 0 support$ by a grant "u ?is
 section2 &  7#d7 a co/-sav+s analysis =
 consum] out-(-pocket & insurance       
premium sp5d+1 bas$ on sav+s t 7 realiz$
 due to a drug or device ^: manufactur] 
0 support$ by a grant "u ?is section1 & 
any impact on consum] access to ! drug  
or device4  7g7 ,waiv] ( us] fees )     
respect to entities n receiv+ an aw>d   
7#a7 ,9 g5]al ,) respect to an entity t 
is an organization describ$ 9 p>agraph  
7#b71 ! ,secret>y %all waive ! foll[+   
fees t w\ld o!rwise be applicable dur+ !
 p]iod dur+ :i* su* entity is s exempt &
 is manufactur+ su* product3 7,a7 ,fees 
"u p>agraphs 7#a7 & 7#b7 ( section      
#gcf7;a7 ( ! ,f$]al ,food1 ,drug1 &     
,cosmetic ,act4  7,b7 ,fees "u p>agraphs
 7#b7 & 7#c7 ( section #gch7;a7 ( !     
,f$]al ,food1 ,drug1 & ,cosmetic ,act4  

7,c7 ,fees "u p>agraphs 7#c71 7#d71 &   
7#e7 ( section #gdd;,b7a7 ( ! ,f$]al    
,food1 ,drug1 & ,cosmetic ,act4  7,d7   
,fees "u p>agraphs 7#a77;,a71 7#a77;,b71
 7#b71 & 7#c7 ( section #gdd;,h ( !     
,f$]al ,food1 ,drug1 & ,cosmetic ,act4  
7#b7 ,entity describ$ ,an entity        
describ$ 9 ?is p>agraph is an entity t--
 7,a7 is describ$ 9 p>agraph 7#c7 or    
7#d7 ( section #eja7;c7 ( ! ,int]nal    
,rev5ue ,code ( #aihf & exempt f tax "u 
section #eja7;a7 ( su* ,code2  7,b7     
manufactures an eligible drug or        
eligible device2 &  7,c7 is n curr5tly  
receiv+ a loan or coop]ative agreem5t "u
 ?is section4  7h7 ,fund+  7#a7         
,au?orization ( appropriations ,to c>ry 
out ?is section1 !re are au?oriz$ to be 
appropriat$ su* sums z may be necess>y =
 ea* ( fiscal ye>s #bjbb ?r\gh #bjca4   
7#b7 ,loan repaym5ts ,9 addition to any 
am\nts appropriat$ "u p>agraph 7#a71 !  
,secret>y ( ! ,treasury %all transf] to 
! ,secret>y ( ,heal? & ,human ,s]vices  
annually an am\nt equal to ! am\nt      

receiv$ = ! previ\s ye> 9 paym5ts on    
loans aw>d$ "u ?is section = purposes ( 
c>ry+ out ! program "u ?is section )    
respect to loans4  4  7b7 ,,cbo report  
,n lat] ?an #a ye> aft] ! date (        
enactm5t ( ?is ,act1 ! ,director ( !    
,congressional ,budget ,(fice %all      
submit budget-neutral or co/-sav+s      
policy options to ,congress %[+ ways to 
capture ! sav+s f nonpr(it drug & device
 manufactur]s support$ by ! program "u  
section #cii,v-#g ( ! ,public ,heal?    
,s]vice ,act1 z add$ by subsection 7a74 
,su* options %all direct at lea/ half ( 
su* sav+s to create a m&atory fund+     
/ream to support grants & l[-int]e/     
loans simil> to grants & loans (f]$ "u  
section #cii,v-#g ( ! ,public ,heal?    
,s]vice ,act1 z add$ by subsection 7a71 
& any rema9+ portion ( su* sav+s t[>d   
ensur+ ! solv5cy ( ! ,m$ic>e program "u 
title ,,xviii ( ! ,social ,security ,act
 7#db ,u4,s4,c4 #acie et seq47 & r$uc+  
out-(-pocket & premium co/s "u su*      
program4  7c7 ,priority review  7#a7    

,n,d,as ,! ,secret>y ( ,heal? & ,human  
,s]vices may grant priority review1 z   
describ$ 9 ! ,manual ( ,policies &      
,proc$ures ( ! ,food & ,drug            
,adm9i/ration & goals id5tifi$ 9 !      
lett]s describ$ 9 section #aja7;b7 ( !  
,prescription ,drug ,us] ,fee ,am5dm5ts 
( #bjag1 = any application t includes a 
commitm5t to a specific price t         
repres5ts a significant co/ r$uction    
comp>$ to simil> treatm5ts on ! m>ket1  
if ! sponsor is a qualifi$ drug or      
device manufactur+ organization 7z def9$
 9 section #eja7s77#d7 ( ! ,int]nal     
,rev5ue ,code ( #aihf74  7#b7 ,a,n,d,as 
,section #eje7;j77#aa77;,a7 ( ! ,f$]al  
,food1 ,drug1 & ,cosmetic ,act 7#ba     
,u4,s4,c4 #cee7;j77#aa77;,a77 is am5d$--
 7,a7 9 clause 7i71 by /rik+ 2 or &     
ins]t+ a semicolon2  7,b7 9 clause 7ii71
 by /rik+ ! p]iod & ins]t+ 2 or2 &  7,c7
 by add+ at ! end ! foll[+3  7iii7 = :i*
 ! sponsor is a qualifi$ drug or device 
manufactur+ organization 7z def9$ 9     
section #eja7s77#d7 ( ! ,int]nal ,rev5ue

 ,code ( #aihf71 & commits to a specific
 price t repres5ts a significant co/    
r$uction comp>$ to simil> treatm5ts on !
 m>ket4  4  7#c7 ,biosimil> biological  
products ,! ,secret>y ( ,heal? & ,human 
,s]vices may grant priority review = any
 application "u section #cea7k7 ( !     
,public ,heal? ,s]vice ,act 7#db        
,u4,s4,c4 #bfb7k77 t includes a         
commitm5t to a specific price t         
repres5ts a significant co/ r$uction    
comp>$ to simil> treatm5ts on ! m>ket1  
if ! sponsor is a qualifi$ drug or      
device manufactur+ organization 7z def9$
 9 section #eja7s77#d7 ( ! ,int]nal     
,rev5ue ,code ( #aihf74  7#d7           
,break?r\gh devices ,section            
#eae;,b7b77#b7 ( ! ,f$]al ,food1 ,drug1 
& ,cosmetic ,act 7#ba ,u4,s4,c4         
#cfj;e-#c7;b77#b77 is am5d$-- 7,a7 9    
subp>agraph 7,c71 by /rik+ 2 or & ins]t+
 a semicolon2  7,b7 by r$esignat+       
subp>agraph 7,d7 z subp>agraph 7,e72 &  
7,c7 by ins]t+ aft] subp>agraph 7,c7 !  
foll[+3  7,d7 = :i* ! sponsor is a      

qualifi$ drug or device manufactur+     
organization 7z def9$ 9 section         
#eja7s77#d7 ( ! ,int]nal ,rev5ue ,code (
 #aihf71 & commits to a specific price t
 repres5ts a significant co/ r$uction   
comp>$ to simil> treatm5ts on ! m>ket2  
or  4  #c4 ,additional rules =          
tax-exempt /atus ( c]ta9 drug & m$ical  
device manufactur]s  7a7 ,9 g5]al       
,section #eja ( ! ,int]nal ,rev5ue ,code
 ( #aihf is am5d$ by add+ at ! end !    
foll[+ new subsection3  7s7 ,additional 
requirem5ts = c]ta9 drug or m$ical      
device manufactur]s  7#a7 ,treatm5t z   
*>itable organization ,a qualifi$ drug  
or m$ical device manufactur+            
organization %all be treat$ z an        
organization organiz$ & op]at$          
exclusively = *>itable purposes "u      
subsection 7c77#c7 if-- 7,a7 su*        
organization meets ! requirem5ts "u     
p>agraph 7#d71  7,b7 no "p ( ! net e>n+s
 ( su* organization inures to ! b5efit (
 any private %>ehold] or individual1    
7,c7 no sub/antial "p ( ! activities (  

su* organization is c>ry+ on propag&a1  
or o!rwise attempt+1 to influ5ce        
legislation 7except z o!rwise provid$ 9 
subsection 7h771 &  7,d7 su*            
organization does n p>ticipate 91 or    
int]v5e 9 7includ+ ! publi%+ or         
di/ribut+ ( /atem5ts71 any political    
campaign on behalf ( 7or 9 opposition   
to7 any c&idate = public (fice4  7#b7   
,treatm5t z social welf>e organization  
,a qualifi$ drug or m$ical device       
organization %all be treat$ z an        
organization organiz$ & op]at$ prim>ily 
to promote social welf>e "u subsection  
7c77#d7 if-- 7,a7 su* organization meets
 ! requirem5ts "u p>agraph 7#d71 &  7,b7
 no "p ( ! net e>n+s ( su* organization 
inures to ! b5efit ( any private        
%>ehold] or individual4  7#c7 ,qualifi$ 
drug or m$ical device manufactur+       
organization ,= purposes ( ?is section--
 7,a7 ,9 g5]al ,! t]m qualifi$ drug or  
m$ical device manufactur+ organization  
means an organization t is organiz$ &   
op]at$ exclusively = ! production (     

drugs or devices4  7,b7 ,special rule   
,an organization %all n fail to be      
treat$ z a qualifi$ drug or m$ical      
device manufactur+ organization solely  
because su* organization provides public
 heal? education1 conducts public heal? 
scre5+s1 or conducts o!r relat$ *>itable
 activities4  7#d7 ,requirem5ts ,!      
requirem5ts ( ?is p>agraph are z foll[s3
 7,a7 ,organization & op]ation ,!       
organization is organiz$ z a nonpr(it   
corporation "u ,/ate law & is compliant 
) ! laws ( ! ,/ate p]ta9+ to op]ation z 
a ph>maceutical or m$ical device        
manufactur]4  7,b7 ,drugs & devices ,ea*
 drug or device manufactur$ by !        
organization-- 7i7 fur!rs a public heal?
 objective 7z det]m9$ by ! ,secret>y1 9 
consultation ) ! ,secret>y ( ,heal? &   
,human ,s]vices71 su* z address+ b>ri]s 
relat$ to availability1 %ortage1 or     
price1 &  7ii7 meets su* o!r            
requirem5ts1 z det]m9$ by ! ,secret>y1 9
 consultation ) ! ,secret>y ( ,heal? &  
,human ,s]vices4  7,c7 ,li/ price  7i7  

,9 g5]al ,! organization e/abli%es a    
public li/ price = ea* drug or device   
manufactur$ by ! organization 9         
accordance ) clause 7ii7 & *>ges no m   
?an su* public li/ price4  7ii7 ,maximum
 li/ price ,! am\nt ( ! public li/ price
 e/abli%$ "u ?is clause ) respect to any
 drug or device %all n be m ?an #abj    
p]c5t ( ! sum (-- 7,i7 ! production co/s
 = ! drug or device1  7,,ii7 an am\nt   
calculat$ to recov] up to ! previ\s #e  
ye>s ( qualifi$ rese>* exp5ses 7z def9$ 
9 section #da7 attributable to ! drug or
 device ov] a #e-ye> p]iod1  7,,iii7 !  
regulatory co/s associat$ ) develop+ &  
ma9ta9+ a m>ket$ drug or device1  7,,iv7
 ! anticipat$ co/s 7n great] ?an ! usual
 & cu/om>y rates7 ( /or+1 w>eh\s+1 &    
di/ribut+ ! drug or device1 plus  7,v7  
int]e/ on loans directly f9anc+ !       
developm5t or production ( ! drug or    
device4  7,d7 ,comp5sation  7i7 ,9 g5]al
 ,! organization meets ! requirem5ts (  
clauses 7ii71 7iii71 & 7iv74  7ii7      
,comp5sation am\nt  7,i7 ,9 g5]al ,!    

highe/ total remun]ation (f]$ to any    
employee ( ! organization or ( an       
applicable indep5d5t contractor ( !     
organization is n m ?an #dj times great]
 ?an ! total remun]ation (f]$ to !      
l[e/-comp5sat$ employee ( ! organization
 or ( any applicable indep5d5t          
contractor ( ! organization4 ,= purposes
 ( ?is clause1 ! comp5sation provid$ to 
a "p-"t h\rly employee %all be det]m9$  
by apply+ su* employee's h\rly wage to !
 numb] ( h\rs ( a full-"t employee4     
7,,ii7 ,applicable indep5d5t contractor 
,! t]m applicable indep5d5t contractor  
means1 ) respect to any organization1   
any indep5d5t contractor t has less ?an 
#b employees & ! contract = :i*         
specifies an h\rly rate4  7iii7         
,comp5sation ( o!r indep5d5t contractors
 ,9 ! case ( any indep5d5t contractor ( 
! organization t is n an applicable     
indep5d5t contractor1 ! organization--  
7,i7 comp5sates any "w done at a fair   
m>ket rate1 &  7,,ii7 keeps su* f9ancial
 in=mation z requir$ by ! ,secret>y )   

respect to am\nts paid to su* indep5d5t 
contractors4  7iv7 ,prohibition on      
outside comp5sation ,! organization does
 n p]mit employees to be comp5sat$ f any
 o!r p]son = "w relat$ to !             
organization4  7,e7 ,bo>d ( directors ,!
 organization-- 7i7 ma9ta9s an indep5d5t
 bo>d ( directors1 &  7ii7 ma9ta9s a    
cle> f9ancial sep>ation f-- 7,i7        
entities ) :i* ! organization conducts  
bus9ess1 &  7,,ii7 entities f :i* !     
organization pur*ases goods or s]vices4 
7#e7 ,o!r def9itions ,= purposes ( ?is  
subsection-- 7,a7 ,drug ,! t]m drug     
means any drug t is approv$ "u section  
#eje ( ! ,f$]al ,food1 ,drug1 &         
,cosmetic ,act 7#ba ,u4,s4,c4 #cee7 or  
lic5s$ "u section #cea ( ! ,public      
,heal? ,s]vice ,act 7#db ,u4,s4,c4      
#bfb74  7,b7 ,device ,! t]m device means
 any device t is approv$ "u section #eae
 ( ! ,f$]al ,food1 ,drug1 & ,cosmetic   
,act 7#ba ,u4,s4,c4 #cfj;e71 cle>$ "u   
section #eaj7k7 ( su* ,act 7#ba         
,u4,s4,c4 #cfj7k771 or au?oriz$ "u      

section #eac7;f77#b7 ( su* ,act 7#ba    
,u4,s4,c4 #cfj;c7f77#b774  7#f7         
,regulations ,! ,secret>y %all issue su*
 regulations & guidance z may be        
necess>y to c>ry out ! provisions ( ?is 
subsection1 includ+ guidance relat+ to  
det]m9+ acceptable me?ods = mak+ !      
calculation "u p>agraph 7#d77;,c77ii74  
4  7b7 ,treatm5t z a public *>ity       
,section #eji7;a7 ( ! ,int]nal ,rev5ue  
,code ( #aihf is am5d$ by /rik+ & at !  
end ( p>agraph 7#c71 by /rik+ ! p]iod at
 ! end ( p>agraph 7#d7 & ins]t+ 1 &1 &  
by ins]t+ aft] p>agraph 7#d7 ! foll[+   
new p>agraph3  7#e7 an organization :i* 
meets ! requirem5ts ( subp>agraphs 7,a71
 7,b71 7,c71 & 7,d7 ( section           
#eja7s77#a74  4  7c7 ,effective date ,! 
am5dm5ts made by ?is section %all apply 
to taxable ye>s beg9n+ aft] ! date ( !  
enactm5t ( ?is ,act4  7d7 ,s5se ( !     
,s5ate ,x is ! s5se ( ! ,s5ate t no?+ 9 
! am5dm5ts made by ?is section %all be  
con/ru$ to prev5t an organization t     
manufactures drugs or m$ical devices & t

 is o!rwise describ$ 9 p>agraph 7#c7 or 
7#d7 ( section #eja7;c7 ( ! ,int]nal    
,rev5ue ,code ( #aihf f be+ treat$ z an 
organization t is s describ$4