S T A T E   O F   N E W   Y O R K
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                                  7686

                            I N  S E N A T E

                              May 12, 2016
                               ___________

Introduced  by  Sen.  HANNON -- read twice and ordered printed, and when
  printed to be committed to the Committee on Health

AN ACT to amend the public health law, in relation to prescription  drug
  cost transparency

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

  Section 1. Legislative intent. It is the intent of the legislature  to
make  information available to the public about the cost and utilization
of pharmaceutical drugs. To fulfill this  goal,  the  legislature  finds
that  there  should be annual reporting of drug costs and use that would
be of use by policymakers, government agencies and others to  understand
pharmacy cost trends.
  S 2. The public health law is amended by adding a new section 278-a to
read as follows:
  S  278-A. PRESCRIPTION DRUG COST TRANSPARENCY. 1. EACH MANUFACTURER OF
A BRAND AND GENERIC MEDICATION THAT IS MADE AVAILABLE IN NEW YORK  STATE
SHALL FILE A REPORT ON PHARMACEUTICAL COSTS AS OUTLINED IN THIS SECTION.
  2.  THE  MANUFACTURER  OF  A  PHARMACEUTICAL DRUG THAT HAS A WHOLESALE
ACQUISITION COST OF ONE THOUSAND DOLLARS FOR A THIRTY DAY  SUPPLY  SHALL
FILE  A REPORT PURSUANT TO THIS SECTION ON THE COSTS FOR EACH QUALIFYING
DRUG. WHOLESALE ACQUISITION COST SHALL HAVE THE SAME MEANING AS FOUND IN
SUBSECTION (C) OF 42 U.S. CODE SECTION 1395W-3A.
  3. THE MANUFACTURER OF A PHARMACEUTICAL  DRUG  WHICH  DURING  A  THREE
MONTH PERIOD HAS A CUMULATIVE PRICE INCREASE OF THREE TIMES THE CONSUMER
PRICE  INDEX  SHALL  FILE A REPORT PURSUANT TO THIS SECTION ON THE COSTS
FOR EACH QUALIFYING DRUG.
  4. THE REPORT SHALL INCLUDE THE FOLLOWING FOR EACH DRUG  DESCRIBED  IN
SUBDIVISIONS TWO AND THREE OF THIS SUBDIVISION:
  (A)  THE  TOTAL  COSTS FOR THE PRODUCTION OF THE DRUG INCLUDING ALL OF
THE FOLLOWING:
  (1) THE TOTAL RESEARCH AND DEVELOPMENT COSTS INCLUDING BUT NOT LIMITED
TO:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD15199-01-6

              

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  (I) THE TOTAL COSTS OF ANY STUDY DRUG MANUFACTURED DURING THIS REPORT-
ING PERIOD IN SUPPORT OF THE U.S. FOOD AND DRUG ADMINISTRATION  APPROVED
USE OF THE DRUG;
  (II)  THE TOTAL COSTS OF ANY PRECLINICAL STUDIES CONDUCTED DURING THIS
REPORTING PERIOD;
  (III) THE TOTAL COSTS OF ANY CLINICAL  TRIALS  CONDUCTED  DURING  THIS
REPORTING PERIOD;
  (IV) THE TOTAL COSTS ASSOCIATED WITH THE PREPARATION AND SUBMISSION OF
ANY  REGULATORY  DOCUMENTS  SUBMITTED TO THE U.S. FOOD AND DRUG ADMINIS-
TRATION DURING THIS REPORTING PERIOD;
  (V) THE TOTAL COSTS OF POST APPROVAL CLINICAL STUDIES MANDATED BY  THE
U.S. FOOD AND DRUG ADMINISTRATION DURING THIS REPORTING PERIOD; AND
  (VI)  THE  TOTAL COSTS OF POST APPROVAL STUDIES EARMARKED FOR PUBLICA-
TION USING EXTERNAL PROVIDERS OF DATA DURING THIS REPORTING PERIOD;
  (2) THE TOTAL COSTS FOR MATERIALS,  MANUFACTURING  AND  ADMINISTRATION
ATTRIBUTABLE TO THE DRUG FOR THIS REPORTING PERIOD;
  (3)  THE TOTAL COSTS PAID BY ANY ENTITY OTHER THAN THE MANUFACTURER OR
PREDECESSOR FOR RESEARCH AND DEVELOPMENT, INCLUDING AN ITEMIZED LIST  OF
ANY  AMOUNT  FROM  FEDERAL, STATE, OR OTHER GOVERNMENTAL PROGRAMS OR ANY
FORM OF SUBSIDIES, GRANTS, OR OTHER SUPPORT FOR THIS  REPORTING  PERIOD;
AND
  (4)  ANY  OTHER  COSTS  TO  ACQUIRE  THE DRUG, INCLUDING COSTS FOR THE
PURCHASE OF PATENTS, LICENSING OR ACQUISITION OF  ANY  CORPORATE  ENTITY
OWNING ANY RIGHTS TO THE DRUG WHILE IN DEVELOPMENT.
  (B)  THE  TOTAL  ADMINISTRATIVE  COSTS  FOR THE PROMOTION OF THE DRUG,
INCLUDING BUT NOT LIMITED TO:
  (I) MARKETING AND ADVERTISING COSTS;
  (II) DIRECT TO CONSUMER ADVERTISING COSTS;
  (III) PRESCRIBER EDUCATION COSTS;
  (IV) PROFESSIONAL EDUCATION COSTS;
  (V) LOBBYING COSTS; AND
  (VI) FINANCIAL ASSISTANCE TO PATIENT GROUPS, DISEASE ASSOCIATIONS,  OR
OTHER CONSUMER ORGANIZATIONS.
  (C)  THE TOTAL PROFIT AS REPRESENTED IN TOTAL DOLLARS AND A PERCENTAGE
OF TOTAL COMPANY PROFIT DERIVED FROM THE SALE OF THE DRUG.
  (D) THE TOTAL AMOUNT OF  FINANCIAL  ASSISTANCE  THE  MANUFACTURER  HAS
PROVIDED  THROUGH  PATIENT  PRESCRIPTION  ASSISTANCE  PROGRAMS  IF  SUCH
PROGRAMS ARE AVAILABLE, INCLUDING BUT NOT LIMITED TO:
  (I) COSTS ASSOCIATED  WITH  DIRECT  TO  CONSUMER  COUPONS  AND  AMOUNT
REDEEMED;
  (II) COSTS ASSOCIATED WITH COPAYMENT ASSISTANCE PROGRAMS; AND
  (III)  COSTS  ASSOCIATED  WITH SAMPLE DOSES, TRIAL DOSES, OR WHERE THE
DRUG PRODUCT IS PROVIDED BUT NOT SOLD.
  (E) THE WHOLESALE ACQUISITION COST OF THE DRUG  AS  PUBLICLY  REPORTED
FOR  EACH  DRUG,  INCLUDING A FIVE-YEAR HISTORY OF WHOLESALE ACQUISITION
COST PRICE INCREASES, EXPRESSED AS A PERCENTAGE, AND THE MONTH OR MONTHS
EACH INCREASE TOOK EFFECT AND ANY EXPLANATION FOR THE PRICE INCREASE.
  5. INFORMATION SHALL BE FILED WITH THE DEPARTMENT ANNUALLY, CONSISTENT
WITH SUBDIVISIONS TWO AND THREE OF THIS SECTION, ON A FORM PRESCRIBED BY
THE DEPARTMENT AND SHALL BE SUBMITTED NO LATER THAN MAY FIRST, TWO THOU-
SAND SEVENTEEN. SUCH INFORMATION SHALL BE UPDATED QUARTERLY.
  6. THE DEPARTMENT SHALL  ISSUE  A  REPORT  OUTLINING  THE  INFORMATION
SUBMITTED  PURSUANT  TO THIS SECTION BY DECEMBER THIRTY-FIRST, TWO THOU-
SAND SEVENTEEN AND ISSUE ADDENDUMS ON A QUARTERLY BASIS  REFLECTING  THE
REQUIREMENTS OF PARAGRAPH (D) OF SUBDIVISION FOUR OF THIS SECTION TO THE

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LEGISLATURE.  SUCH  INFORMATION  SHALL BE MADE PUBLICLY AVAILABLE ON THE
DEPARTMENT'S WEBSITE.
  7.  THE  DEPARTMENT SHALL CONVENE AN ADVISORY WORKGROUP TO DEVELOP THE
FORMS REQUIRED BY THIS SECTION. THE WORKGROUP SHALL INCLUDE, BUT IS  NOT
LIMITED  TO,  REPRESENTATIVES  FROM  THE PHARMACEUTICAL INDUSTRY, HEALTH
INSURANCE  PLANS,  PHARMACY  BENEFIT  MANAGERS,  GOVERNMENTAL  AGENCIES,
CONSUMER ADVOCATES, AND PHYSICIANS.
  8.  THE  DEPARTMENT SHALL MAINTAIN THE CONFIDENTIALITY OF ANY INFORMA-
TION SUBMITTED PURSUANT TO THIS SECTION THAT THE COMMISSIONER  DEEMS  TO
BE  CONFIDENTIAL,  PROPRIETARY  INFORMATION  OF  THE  PRESCRIPTION  DRUG
MANUFACTURER AND THE DISCLOSURE OF WHICH WOULD  CAUSE  THE  MANUFACTURER
COMPETITIVE HARM. THIS CONFIDENTIAL PROPRIETARY INFORMATION SHALL NOT BE
MADE  PUBLIC  BY  THE DEPARTMENT AND IS EXEMPT FORM DISCLOSURE UNDER THE
STATE FREEDOM OF INFORMATION LAW.
  S 3. This act shall take effect immediately.