Bill Text: TX HB697 | 2019-2020 | 86th Legislature | Introduced


Bill Title: Relating to required prescription drug cost and rebate reporting; authorizing a civil penalty.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2019-02-21 - Referred to Public Health [HB697 Detail]

Download: Texas-2019-HB697-Introduced.html
  86R1825 KKR-D
 
  By: Blanco H.B. No. 697
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to required prescription drug cost and rebate reporting;
  authorizing a civil penalty.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 430.001, Health and Safety Code, is
  amended by amending Subdivision (1) and adding Subdivision (1-a) to
  read as follows:
               (1)  "Commission" means the Health and Human Services
  Commission.
               (1-a)  "Commissioner" means the commissioner of state
  health services.
         SECTION 2.  Subchapter E, Chapter 431, Health and Safety
  Code, is amended by adding Sections 431.1165 and 431.1166 to read as
  follows:
         Sec. 431.1165.  PRESCRIPTION DRUG MANUFACTURER COST
  REPORTING; CIVIL PENALTY. (a)  In this section:
               (1)  "Manufacturer" means a person licensed or approved
  by the United States Food and Drug Administration to engage in the
  manufacture of drugs or devices, consistent with the federal
  agency's definition of "manufacturer" under the agency's
  regulations and guidances implementing the Prescription Drug
  Marketing Act of 1987 (Pub. L. No. 100-293).  The term does not
  include a pharmacist engaged in compounding that is within the
  practice of pharmacy and is in accordance with a prescription drug
  order or initiative from a practitioner for a patient or
  prepackaging that complies with Section 562.154, Occupations Code.
               (2)  "Prescription drug" has the meaning assigned by 21
  C.F.R. Section 203.3.
         (b)  Not later than February 1 of each year, the commission
  shall:
               (1)  identify the prescription drugs and the wholesale
  price for each drug the commission determines is essential to
  treating diabetes in this state, including insulin and biguanides;
               (2)  identify the prescription drugs described by
  Subdivision (1) for which the wholesale price has increased in an
  amount equal to or greater than:
                     (A)  the percentage of price increase in the
  medical care component of the consumer price index as published by
  the Bureau of Labor Statistics of the United States Department of
  Labor during the preceding calendar year; or
                     (B)  two times the percentage of price increase in
  the medical care component of the consumer price index as published
  by the Bureau of Labor Statistics of the United States Department of
  Labor during the preceding two calendar years; and
               (3)  post the information compiled under Subdivisions
  (1) and (2) on the commission's Internet website.
         (c)  Not later than August 1 of each year, a manufacturer
  shall submit to the commission, in the manner and form prescribed by
  the executive commissioner, a report for each prescription drug
  identified under Subsection (b) that is manufactured by the
  manufacturer and available for sale in this state.
         (d)  For each prescription drug identified under Subsection
  (b)(1) and included in the report under Subsection (c), the
  manufacturer, for the preceding calendar year, shall provide:
               (1)  the cost incurred by the manufacturer in producing
  the drug;
               (2)  the wholesale price of the drug;
               (3)  a history of any increases in the wholesale price
  of the drug for the preceding five years, including the amount of
  each increase expressed as a percentage of the total wholesale
  price of the drug, the month and year the price increase took
  effect, and any explanation for the price increase;
               (4)  the profit derived from the sale of the drug,
  expressed as an amount and as a percentage of the manufacturer's
  total profit from all prescription drugs sold by the manufacturer;
               (5)  the administrative, marketing, and advertising
  costs of promoting the drug;
               (6)  the cost to the manufacturer of coupons provided
  directly to consumers to assist consumers in paying copayments and
  the value of the coupons redeemed;
               (7)  the cost to the manufacturer of programs designed
  to assist consumers in paying copayments for the drug;
               (8)  the amount of financial assistance provided for
  the drug by the manufacturer through patient prescription
  assistance programs; and
               (9)  the aggregate amount of rebates paid to pharmacy
  benefit managers, as defined by Section 4151.151, Insurance Code,
  for sales of the drug in this state.
         (e)  For each prescription drug identified under Subsection
  (b)(2) and included in the report under Subsection (c), the
  manufacturer, for the preceding calendar year, shall provide
  information that justifies the increase in the wholesale price,
  including:
               (1)  the factors contributing to the wholesale price
  increase;
               (2)  the percentage of the total wholesale price
  increase attributable to each factor; and
               (3)  an explanation of the role of each factor in
  contributing to the wholesale price increase.
         (f)  Not later than December 1 of each year, the commission
  shall prepare and post on the commission's Internet website a
  report outlining the information provided by a manufacturer under
  this section.  The report may not include information likely to
  compromise the financial, competitive, or proprietary nature of the
  information.
         (g)  Information provided by a manufacturer to the
  commission under this section is confidential and is not subject to
  disclosure under Chapter 552, Government Code.
         (h)  A manufacturer that does not submit the report required
  by Subsection (c) is liable to the state for a civil penalty of not
  more than $5,000 for each violation.  The commission may waive the
  civil penalty if a manufacturer provides good cause for the
  manufacturer's failure to submit the report.  Each failure to
  provide information to the commission is a separate violation and
  each day of continuing violation constitutes a separate violation.  
  The attorney general at the request of the commission may bring suit
  to provide for injunctive relief or to recover a civil penalty, or
  both.  The attorney general may recover court costs and reasonable
  attorney's fees.
         Sec. 431.1166.  PHARMACY BENEFIT MANAGER PRESCRIPTION DRUG
  REBATE REPORTING. (a)  In this section:
               (1)  "Manufacturer" means a person licensed or approved
  by the United States Food and Drug Administration to engage in the
  manufacture of drugs or devices, consistent with the federal
  agency's definition of "manufacturer" under the agency's
  regulations and guidances implementing the Prescription Drug
  Marketing Act of 1987 (Pub. L. No. 100-293).  The term does not
  include a pharmacist engaged in compounding that is within the
  practice of pharmacy and is in accordance with a prescription drug
  order or initiative from a practitioner for a patient or
  prepackaging that complies with Section 562.154, Occupations Code.
               (2)  "Pharmacy benefit manager" has the meaning
  assigned by Section 4151.151, Insurance Code.
               (3)  "Prescription drug" has the meaning assigned by 21
  C.F.R. Section 203.3.
         (b)  Not later than August 1 of each year, a pharmacy benefit
  manager shall submit a report to the commission, in the manner and
  form prescribed by the executive commissioner, regarding rebates
  for each prescription drug identified under Section 431.1165(b)(1)
  that is available for sale in this state.  The report must include:
               (1)  the total amount of rebates the pharmacy benefit
  manager negotiated with all manufacturers during the preceding
  calendar year;
               (2)  the amount of the rebates described in Subdivision
  (1) that were retained by the pharmacy benefit manager; and
               (3)  the amount of any rebates described in Subdivision
  (1) that were negotiated for use by persons who receive
  prescription drug benefits or assistance under Medicare or a state,
  local, or federal public program.
         (c)  This section does not apply to prescription drug
  benefits provided under a health care benefit plan established
  under the Employee Retirement Income Security Act of 1974 (29
  U.S.C. Section 1001 et seq.).
         (d)  Not later than December 1 of each year, the commission
  shall prepare and post on the commission's Internet website a
  report outlining the information provided by a pharmacy benefit
  manager under this section.  The report may not include information
  that is likely to compromise the financial, competitive, or
  proprietary nature of the information.
         (e)  Information provided by a pharmacy benefit manager to
  the commission under this section is confidential and is not
  subject to disclosure under Chapter 552, Government Code.
         SECTION 3.  As soon as practicable after the effective date
  of this Act, the executive commissioner of the Health and Human
  Services Commission shall adopt rules necessary to implement
  Sections 431.1165 and 431.1166, Health and Safety Code, as added by
  this Act.
         SECTION 4.  This Act takes effect September 1, 2019.
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