We have developed two modulator driver ICs that are based on the functional distributed circuit (FDC) topology for over 40-Gb/s optical transmission systems using InP HBT technology. The FDC topology enables both a wide bandwidth amplifier and high-speed digital functions. The none-return-to-zero (NRZ) driver IC, which is integrated with a D-type flip-flop, exhibits 2.6-V_p-p (differential output: 5.2V_p-p) output-voltage swings with a high signal quality at 43 and 50Gb/s. The return-to-zero (RZ) driver IC, which is integrated with a NRZ to RZ converter, produces 2.4-V_p-p (differential output: 4.8V_p-p) output-voltage swings and excellent eye openings at 43 and 50Gb/s. Furthermore, we conducted electro-optical modulation experiments using the developed modulator driver ICs and a dual drive LiNbO₃ Mach-Zehnder modulator. We were able to obtain NRZ and RZ clear optical eye openings with low jitters and sufficient extinction ratios of more than 12dB, at 43 and 50Gb/s. These results indicate that the FDC has the potential to achieve a large output voltage and create high-speed functional ICs for over-40-Gb/s transmission systems.