S T A T E O F N E W Y O R K
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1636
2011-2012 Regular Sessions
I N A S S E M B L Y
January 11, 2011
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Introduced by M. of A. COLTON -- read once and referred to the Committee
on Health
AN ACT to amend the public health law, in relation to requiring the
manufacturer or labeler of each prescription drug to annually report
the marketing costs of such drug to the department of health
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Legislative intent. The legislature hereby finds and
declares that the price of prescription drugs in this state and across
the nation has been increasing at an alarming rate over the past decade.
Prescription drug costs are increasing at a faster rate than any other
component of health care and are driving the increase in overall health
care cost. As is apparent by the ubiquitous nature of the marketing and
public information campaigns relating to prescription drugs, pharmaceu-
tical manufacturers put a great deal of resources into marketing their
products. This has been especially true since the 1997 relaxation of
federal laws relating to prescription drug advertising. It is in the
interest of assisting this state in its role as a purchaser of
prescription drugs and administrator of prescription drug programs, to
enable the state to determine the scope of prescription drug marketing
costs and their effect on the cost, utilization and delivery of health
care services, and thus further the role of this state as guardian of
the public interest.
S 2. Section 206 of the public health law is amended by adding a new
subdivision 28 to read as follows:
28. THE COMMISSIONER IS AUTHORIZED AND DIRECTED TO REQUIRE MANUFACTUR-
ERS OR LABELERS OF PRESCRIPTION DRUGS, WHICH DISPENSE SUCH DRUGS IN THIS
STATE AND WHICH EMPLOY, DIRECT OR UTILIZE MARKETING REPRESENTATIVES IN
THE STATE, TO REPORT THE MARKETING COSTS OF EACH OF ITS PRESCRIPTION
DRUGS DISPENSED IN THIS STATE.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD02419-01-1
A. 1636 2
(A) DEFINITIONS. AS USED IN THIS SUBDIVISION, UNLESS THE CONTEXT
CLEARLY INDICATES OTHERWISE, THE FOLLOWING TERMS SHALL HAVE THE FOLLOW-
ING MEANINGS:
(I) "LABELER" MEANS ANY PERSON OR ENTITY, HAVING A LABELER CODE FROM
THE FEDERAL FOOD AND DRUG ADMINISTRATION, THAT RECEIVES A PRESCRIPTION
DRUG FROM THE MANUFACTURER OR A WHOLESALER OF SUCH DRUG, AND REPACKAGES
SUCH DRUG TO BE DISPENSED IN THIS STATE.
(II) "MANUFACTURER" MEANS A MANUFACTURER OF PRESCRIPTION DRUGS
DISPENSED IN THIS STATE, AND SHALL INCLUDE THE SUBSIDIARY OR AFFILIATE
OF SUCH MANUFACTURER.
(III) "MARKETING" MEANS ADVERTISING AND PROMOTIONAL ACTIVITIES FOR
PRESCRIPTION DRUGS DISPENSED IN THIS STATE INCLUDING, BUT NOT LIMITED
TO, THOSE ACTIVITIES DESCRIBED IN PARAGRAPH (B) OF THIS SUBDIVISION.
(B) MANNER OF REPORTING. ON OR BEFORE JULY FIRST EACH YEAR EVERY
MANUFACTURER AND LABELER SHALL FILE A REPORT WITH THE DEPARTMENT ON ITS
MARKETING ACTIVITIES CONDUCTED IN THIS STATE. SUCH REPORT SHALL BE
SUBMITTED IN SUCH FORM AND MANNER, AND INCLUDE THE PAYMENT OF SUCH A FEE
AS SHALL BE DETERMINED BY THE COMMISSIONER. EACH SUCH REPORT SHALL
INCLUDE THE VALUE, NATURE, PURPOSE AND RECIPIENT OF MARKETING EXPENSES
INCLUDING, BUT NOT LIMITED TO:
(I) ALL EXPENSES ASSOCIATED WITH ADVERTISING, MARKETING AND DIRECT
PROMOTION OF PRESCRIPTION DRUGS THROUGH RADIO, TELEVISION, MAGAZINES,
NEWSPAPERS, DIRECT MAIL AND TELEPHONE COMMUNICATIONS AS THEY PERTAIN TO
RESIDENTS OF THIS STATE;
(II) WITH REGARD TO ALL PROVIDERS OF HEALTHCARE SERVICES REGULATED BY
THE DEPARTMENT UNDER THE PROVISIONS OF ARTICLE TWENTY-EIGHT, THIRTY-SIX
OR FORTY-FOUR OF THIS CHAPTER, INCLUDING HEALTH MAINTENANCE ORGANIZA-
TIONS ESTABLISHED PURSUANT TO ARTICLE FORTY-THREE OF THE INSURANCE LAW,
THE FOLLOWING INFORMATION:
(A) ALL EXPENSES ASSOCIATED WITH EDUCATIONAL OR INFORMATIONAL
PROGRAMS, MATERIALS AND SEMINARS, AND REMUNERATION FOR PROMOTING OR
PARTICIPATING IN EDUCATIONAL OR INFORMATIONAL SESSIONS, REGARDLESS OF
WHETHER THE MANUFACTURER OR LABELER PROVIDES THE EDUCATIONAL OR INFORMA-
TIONAL SESSIONS OR MATERIALS,
(B) ALL EXPENSES ASSOCIATED WITH FOOD, ENTERTAINMENT AND GIFTS VALUED
AT MORE THAN SEVENTY-FIVE DOLLARS, AND ANYTHING PROVIDED TO A HEALTH
CARE PROFESSIONAL FOR LESS THAN MARKET VALUE,
(C) ALL EXPENSES ASSOCIATED WITH TRIPS AND TRAVEL, AND
(D) ALL EXPENSES ASSOCIATED WITH PRODUCT SAMPLES, EXCEPT FOR SAMPLES
THAT WILL BE DISTRIBUTED FREE OF CHARGE TO PATIENTS; AND
(III) THE AGGREGATE COST OF ALL EMPLOYEES AND CONTRACTORS OF THE
MANUFACTURER OR LABELER WHO DIRECTLY OR INDIRECTLY ENGAGE IN THE ADVER-
TISING OR PROMOTIONAL ACTIVITIES LISTED IN SUBPARAGRAPHS (I) AND (II) OF
THIS PARAGRAPH, INCLUDING ALL FORMS OF PAYMENT TO SUCH EMPLOYEES AND
CONTRACTORS. THE COST REPORTED PURSUANT TO THIS SUBPARAGRAPH SHALL
REFLECT ONLY THAT PORTION OF PAYMENT TO EMPLOYEES AND CONTRACTORS THAT
PERTAINS TO ACTIVITIES WITHIN THIS STATE OR TO RECIPIENTS OF THE ADVER-
TISING OR PROMOTIONAL ACTIVITIES WHO ARE RESIDENTS OF OR ARE EMPLOYED IN
THIS STATE.
(C) EXCEPTIONS. THE FOLLOWING MARKETING EXPENSES SHALL NOT BE SUBJECT
TO THE REPORTING REQUIREMENTS OF THIS SUBDIVISION:
(I) EXPENSES OF SEVENTY-FIVE DOLLARS OR LESS;
(II) REASONABLE COMPENSATION AND REIMBURSEMENT FOR EXPENSES IN
CONNECTION WITH A BONA FIDE CLINICAL TRIAL OF A NEW VACCINE, THERAPY OR
TREATMENT; AND
A. 1636 3
(III) SCHOLARSHIPS AND REIMBURSEMENT OF EXPENSES FOR ATTENDING A
SIGNIFICANT EDUCATIONAL, SCIENTIFIC OR POLICY-MAKING CONFERENCE OR SEMI-
NAR OF A NATIONAL, REGIONAL OR SPECIALTY MEDICAL OR OTHER PROFESSIONAL
ASSOCIATION IF THE RECIPIENT OF THE SCHOLARSHIP IS CHOSEN BY THE ASSOCI-
ATION SPONSORING THE CONFERENCE OR SEMINAR.
(D) DEPARTMENT REPORTS. ANNUALLY ON OR BEFORE NOVEMBER THIRTIETH, THE
DEPARTMENT SHALL SUBMIT A REPORT, PROVIDING INFORMATION IN AGGREGATE
FORM, ON PRESCRIPTION DRUG MARKETING EXPENSES TO THE GOVERNOR, TEMPORARY
PRESIDENT OF THE SENATE AND SPEAKER OF THE ASSEMBLY. ON OR BEFORE JANU-
ARY FIRST, TWO THOUSAND TWELVE AND EVERY TWO YEARS THEREAFTER, THE
DEPARTMENT SHALL PROVIDE A REPORT TO THE GOVERNOR, TEMPORARY PRESIDENT
OF THE SENATE AND SPEAKER OF THE ASSEMBLY, PROVIDING INFORMATION IN
AGGREGATE FORM, CONTAINING AN ANALYSIS OF THE DATA SUBMITTED TO THE
DEPARTMENT, INCLUDING THE SCOPE OF PRESCRIPTION DRUG MARKETING ACTIV-
ITIES AND EXPENSES AND THEIR EFFECT ON THE COST, UTILIZATION AND DELIV-
ERY OF HEALTH CARE SERVICES AND ANY RECOMMENDATIONS WITH REGARD TO
MARKETING ACTIVITIES OF PRESCRIPTION DRUG MANUFACTURERS AND LABELERS.
(E) CONFIDENTIALITY; PUBLIC INFORMATION. NOTWITHSTANDING ANY PROVISION
OF LAW TO THE CONTRARY, ALL INFORMATION SUBMITTED TO THE DEPARTMENT
PURSUANT TO THIS SUBDIVISION SHALL BE CONFIDENTIAL AND NOT A PUBLIC
RECORD AS DEFINED IN SECTION EIGHTY-SIX OF THE PUBLIC OFFICERS LAW. DATA
COMPILED IN AGGREGATE FORM BY THE DEPARTMENT FOR THE PURPOSES OF REPORT-
ING REQUIRED BY THIS SUBDIVISION SHALL BE A PUBLIC RECORD AS DEFINED IN
SECTION EIGHTY-SIX OF THE PUBLIC OFFICERS LAW, AS LONG AS IT DOES NOT
REVEAL TRADE INFORMATION THAT IS PROTECTED BY STATE OR FEDERAL LAW.
(F) VIOLATIONS. ANY PERSON WHO VIOLATES ANY PROVISION OF THIS SUBDIVI-
SION SHALL BE LIABLE TO THE PEOPLE OF THE STATE FOR A CIVIL PENALTY OF
TEN THOUSAND DOLLARS, PLUS COURT COSTS AND ATTORNEYS' FEES, WHICH SHALL
BE ENFORCED PURSUANT TO TITLE TWO OF THIS ARTICLE.
(G) RULES. ANY AND ALL RULES AND REGULATIONS NECESSARY TO IMPLEMENT
THE PROVISIONS OF THIS SUBDIVISION SHALL BE PROMULGATED BY THE COMMIS-
SIONER.
S 3. This act shall take effect on the one hundred eightieth day after
it shall have become a law. Effective immediately, any rules and regu-
lations necessary to implement the provisions of this act on its effec-
tive date are authorized to be made on or before such effective date.