Overview
Title
To enable the Federal Trade Commission to deter filing of sham citizen petitions to cover an attempt to interfere with approval of a competing generic drug or biosimilar, to foster competition, and facilitate the efficient review of petitions filed in good faith to raise legitimate public health concerns, and for other purposes.
ELI5 AI
The "Stop STALLING Act" tries to stop people from making fake complaints that slow down the approval of cheaper medicines. It wants to make sure that real concerns about medicine safety can still be heard, while those who trick the system to stop competition can be fined by the government.
Summary AI
The bill titled the “Stop STALLING Act” aims to prevent companies from filing sham citizen petitions that delay the approval of generic drugs or biosimilars, thereby fostering competition in the drug market. It allows the Federal Trade Commission (FTC) to take action against individuals or entities that attempt to interfere with a competitor’s business by using baseless petitions. If the FTC identifies such violations, it can impose civil penalties, including fines based on the revenue earned from delayed drug sales or a daily fine while petitions are under review. The bill ensures that legitimate petitions raising public health concerns can still be reviewed in good faith, without being obstructed by false petitions.
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AnalysisAI
General Summary of the Bill
The proposed legislation, known as the “Stop Significant and Time-wasting Abuse Limiting Legitimate Innovation of New Generics Act” or the “Stop STALLING Act,” aims to empower the Federal Trade Commission (FTC) to deter and penalize the filing of false or baseless petitions. These sham petitions are often used to delay the approval of generic drugs or biosimilars, thereby hampering competition. The bill establishes clear definitions and procedures for identifying such petitions and imposes penalties to prevent such practices. Additionally, the Act includes a severability clause to maintain the enforceability of the remaining provisions even if part of the Act is found unconstitutional.
Summary of Significant Issues
Setting a key challenge, the bill's definition of a "sham" petition involves subjective language, such as "objectively baseless," which may leave room for interpretation and inconsistencies. The bill also proposes substantial civil penalties without an explicit cap or detailed mitigating circumstances, raising concerns about potential financial burdens on petitioners. Furthermore, there are limitations on judicial review of the Secretary of Health and Human Services' determinations, which could be seen as restricting the rights of petitioners to challenge decisions. Language complexity and procedural clarity are additional areas that might need refinement to facilitate understanding and compliance across various stakeholders.
Impact on the Public
The bill aims to foster increased competition by preventing practices that delay the launch of more affordable generic medications. This could lead to more accessible healthcare options and potentially lower drug prices for the public. By curbing unwarranted delays in the approval process, consumers may benefit from a wider array of generic and biosimilar drugs which could improve overall public health outcomes.
Impact on Specific Stakeholders
For pharmaceutical companies and individuals engaged in filing legitimate petitions, the bill could promote fairer competition and innovation. However, entities that unintentionally submit petitions deemed as "sham" might face severe financial penalties, possibly deterring valid petitions due to fear of punitive actions. This perceived overreach might lead to legal challenges and heighten regulatory scrutiny, especially if there's a lack of concrete guidelines for mitigating circumstances or unclear procedural processes.
On a broader scale, the bill could enhance the FTC's role in policing anti-competitive practices, potentially creating an environment more conducive to genuine pharmaceutical innovation. It seeks to balance the interests of encouraging real competitive practices while reducing any misuse of governmental petition processes aimed at stifling competition. Nonetheless, adjustments in legal and procedural articulation could be crucial to ensure that enforcement is fair and consistent, encouraging transparency and accountability across the pharmaceutical industry.
Financial Assessment
The "Stop STALLING Act" introduces several financial measures intended to penalize and deter companies from obstructing the approval of generic drugs and biosimilars through sham petitions. These financial penalties are a central aspect of the bill’s enforcement strategy, aiming to maintain a fair competitive environment in the pharmaceutical market. Here’s a detailed look at how these financial components are addressed and potentially impacted by identified issues:
Civil Penalties and Revenue Considerations
The bill specifies a civil penalty for each proven violation where a company is found to have submitted a sham petition. Notably, the penalty is articulated as being not more than the greater of two options:
- The revenue earned from the sale of any drug product that was subject to the sham petition during its review period.
- A fixed monetary amount of $50,000 for each calendar day that the sham petition was being reviewed by the Secretary of Health and Human Services.
These provisions are designed to heavily penalize companies that engage in such unethical practices, creating a strong disincentive. However, one issue is the broad scope of these penalties, which is highlighted in the ISSUES section. The lack of detail concerning mitigating circumstances or a cap on total penalties could result in severe financial implications for companies, potentially considered disproportionate or punitive beyond what might be seen as fair or equitable.
Potential for Subjectivity in Financial Impositions
The definition and identification of a "sham" petition may be considered subjective. The description includes terms like "objectively baseless" and the intent to interfere with a competitor’s business. This vagueness could lead to a variety of interpretations, which in turn might lead to inconsistent enforcement of penalties. Given the financial stakes involved, such subjectivity in a legal context may result in contentious legal battles over what constitutes a sham, raising concerns about the potential misuse of financial penalties as a tool of competitive suppression, rather than legitimate regulation.
Judicial Review Limitations and Financial Impact
The limitation on judicial review of the Health and Human Services Secretary's referrals further complicates financial implications. The restriction that precludes direct judicial review of such determinations without a third-party claim could limit companies' ability to contest potentially severe financial penalties, prompting ethical and legal debates. This limitation, combined with the significant financial stakes outlined, could be perceived as limiting due process rights, a concern echoed in the issues identified.
Clarity and Simplification Needs
The language around financial penalties, specifically in terms of "civil action to recover a civil penalty and seek other appropriate relief," could potentially benefit from simplification. This complexity could hinder the clear understanding of the financial commitments or obligations imposed by the bill. Clearer language might also aid in reducing misunderstandings related to financial enforcement and ensure companies are fully informed about the financial risks of violating the act.
In conclusion, while the financial penalties embedded in the Stop STALLING Act aim to curb obstructive behaviors in the pharmaceutical industry, the issues surrounding clarity, subjectivity, and limitations on judicial review could impact the fairness and effectiveness of their implementation.
Issues
The definition of 'sham' in Section 2(a)(6) might be considered subjective due to terms like 'objectively baseless' and 'interfering with the business of a competitor', which could lead to varying interpretations. This could result in inconsistent enforcement and legal challenges.
The civil penalty provision in Section 2(c)(4) is broad, allowing for financial penalties with little detail on mitigating circumstances or a cap on total penalties. This could have significant financial implications for companies and may be seen as overreaching.
Section 2(c)(5) limits judicial review of the referral by the Secretary of Health and Human Services, which may raise concerns about the right to contest administrative decisions. This could be controversial from a legal and ethical perspective.
The term 'series of covered petitions' in Section 2(a)(5) could potentially be misused if vague connections between petitions are made to establish a series. This might lead to unjustified penalties or pressure on petitioners, raising ethical and legal concerns.
Language in several sections, such as 'civil action to recover a civil penalty and seek other appropriate relief' in Section 2(c)(1), could be considered complex and may benefit from simplification or further clarity to ensure clear understanding and compliance.
The severability clause in Section 3, while standard, is written as a single sentence, which could be overly complex and might benefit from being divided into shorter sentences for clarity, especially for those not familiar with legal or legislative terms.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the Act provides its short title and allows it to be referred to as the “Stop Significant and Time-wasting Abuse Limiting Legitimate Innovation of New Generics Act” or simply the “Stop STALLING Act.”
2. Federal Trade Commission enforcement against sham petitions Read Opens in new tab
Summary AI
The section addresses how the Federal Trade Commission can take action against people or companies submitting false or baseless petitions with the aim of interfering with competitors' businesses. It describes what qualifies as a "sham" petition, outlines potential penalties, and explains that these penalties are in addition to other legal consequences already in place.
Money References
- (4) CIVIL PENALTY.—In an action under paragraph (1), any person that has been found liable for a violation of section 5(a)(1) of the Federal Trade Commission Act (15 U.S.C. 45(a)(1)) shall be subject to a civil penalty for each violation of not more than the greater of— (A) any revenue earned from the sale by such person of any drug product, referenced in a covered application that was the subject of a covered petition or a series of covered petitions that is a sham, during the period during which the covered petition or series of covered petitions was under review by the Secretary of Health and Human Services; or (B) $50,000 for each calendar day that each covered petition that is a sham or that was part of a series of covered petitions that is a sham was under review by the Secretary of Health and Human Services.
3. Severability Read Opens in new tab
Summary AI
If any part of this Act is found to be unconstitutional, the rest of the Act will continue to be in effect, and how the remaining parts apply to people or situations will not be changed.