S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  6731

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                              April 1, 2015
                               ___________

Introduced  by  M. of A. CRESPO, PICHARDO, TITONE, BLAKE, JOYNER, ROBIN-
  SON, CROUCH, RIVERA, ARROYO, MILLER, PALUMBO -- Multi-Sponsored by  --
  M.  of  A.  DUPREY,  HEVESI,  LOPEZ,  SIMON,  THIELE  -- read once and
  referred to the Committee on Consumer Affairs and Protection

AN ACT to amend the general business law, in relation to the price goug-
  ing of medicine

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The general business law is amended by adding a new section
396-rrr to read as follows:
  S  396-RRR.  PRICE  GOUGING  OF  MEDICINE. 1. FOR THE PURPOSES OF THIS
SECTION, "DRUG SUBJECT TO A SHORTAGE" SHALL MEAN  ANY  DRUG  OR  MEDICAL
PRODUCT  INTENDED  FOR HUMAN USE PUBLICLY REPORTED AS BEING SUBJECT TO A
SHORTAGE BY THE U.S.  FOOD  AND  DRUG  ADMINISTRATION  ON  ITS  WEBSITE,
PROVIDED,  HOWEVER, THAT A DRUG OR MEDICAL PRODUCT SHALL ONLY BE CONSID-
ERED A "DRUG SUBJECT TO A SHORTAGE" DURING THE PERIOD OF TIME THAT  SUCH
DRUG OR MEDICAL PRODUCT IS LISTED AS BEING SUBJECT TO A SHORTAGE ON SUCH
WEBSITE.
  2.  NO PARTY WITHIN THE CHAIN OF DISTRIBUTION OF ANY DRUG SUBJECT TO A
SHORTAGE SHALL SELL OR OFFER TO SELL ANY SUCH DRUG SUBJECT TO A SHORTAGE
FOR AN AMOUNT WHICH REPRESENTS AN UNCONSCIONABLY EXCESSIVE PRICE.
  3. WHETHER A PRICE IS UNCONSCIONABLY EXCESSIVE IS A  QUESTION  OF  LAW
FOR THE COURT.
  (A)  THE  COURT'S  DETERMINATION  THAT A VIOLATION OF THIS SECTION HAS
OCCURRED SHALL BE BASED ON ANY OF THE FOLLOWING FACTORS:
  (I) THAT THE AMOUNT OF THE EXCESS IN PRICE IS UNCONSCIONABLY EXTREME;
  (II) THAT THERE WAS AN EXERCISE OF UNFAIR LEVERAGE  OR  UNCONSCIONABLE
MEANS; OR
  (III)  A  COMBINATION OF BOTH FACTORS IN SUBPARAGRAPHS (I) AND (II) OF
THIS PARAGRAPH.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00753-01-5

              

A. 6731                             2

  (B) IN ANY PROCEEDING COMMENCED PURSUANT TO SUBDIVISION FOUR  OF  THIS
SECTION, PRIMA FACIE PROOF THAT A VIOLATION OF THIS SECTION HAS OCCURRED
SHALL INCLUDE EVIDENCE THAT:
  (I)  THE AMOUNT CHARGED REPRESENTS A GROSS DISPARITY BETWEEN THE PRICE
OF THE DRUG SUBJECT TO A SHORTAGE WHICH WAS THE SUBJECT  OF  THE  TRANS-
ACTION AND THEIR VALUE MEASURED BY THE PRICE AT WHICH SUCH DRUG WAS SOLD
OR  OFFERED  FOR  SALE  BY THE DEFENDANT IN THE USUAL COURSE OF BUSINESS
IMMEDIATELY PRIOR TO THE ONSET OF THE SHORTAGE; AND
  (II) THE AMOUNT CHARGED GROSSLY EXCEEDED THE PRICE AT WHICH  THE  SAME
OR  SIMILAR  DRUG  SUBJECT TO A SHORTAGE WAS READILY OBTAINABLE BY OTHER
PURCHASERS IN THE TRADE AREA. A DEFENDANT MAY REBUT A PRIMA  FACIE  CASE
WITH  EVIDENCE  THAT  ADDITIONAL  COSTS  NOT  WITHIN  THE CONTROL OF THE
DEFENDANT WERE IMPOSED ON THE DEFENDANT FOR THE DRUG SUBJECT TO A SHORT-
AGE.
  4. WHERE A VIOLATION OF THIS SECTION IS ALLEGED TO HAVE OCCURRED,  THE
ATTORNEY GENERAL MAY APPLY IN THE NAME OF THE PEOPLE OF THE STATE OF NEW
YORK  TO  THE  SUPREME  COURT WITHIN THE JUDICIAL DISTRICT IN WHICH SUCH
VIOLATION IS ALLEGED TO HAVE OCCURRED, ON NOTICE OF FIVE  DAYS,  FOR  AN
ORDER  ENJOINING OR RESTRAINING COMMISSION OR CONTINUANCE OF THE ALLEGED
UNLAWFUL ACTS. IN ANY SUCH PROCEEDING, THE COURT SHALL  IMPOSE  A  CIVIL
PENALTY  IN  AN  AMOUNT  NOT TO EXCEED ONE HUNDRED THOUSAND DOLLARS AND,
WHERE APPROPRIATE, ORDER RESTITUTION TO AGGRIEVED CONSUMERS.
  5. PRIOR TO APPLYING FOR AN ORDER FROM THE SUPREME COURT  PURSUANT  TO
SUBDIVISION  FOUR OF THIS SECTION, THE ATTORNEY GENERAL, IN CONSULTATION
WITH THE DEPARTMENT OF  HEALTH,  SHALL  CONSIDER  THE  PRICING  DYNAMICS
UNIQUE TO THE SMALL AND INDEPENDENT DISTRIBUTORS WITHIN THE SUPPLY CHAIN
INCLUDING,  BUT NOT LIMITED TO, THE PRICE CHARGED BY THE END USE DISPEN-
SER RELATIVE TO ITS ACQUISITION COST.
  S 2. This act shall take effect immediately.