NY State Senate Bill 2019-S5943

Senate Bill S5943

2019-2020 Legislative Session

Requires the commissioner of health to include in annual reports information regarding the cost and increase in cost of certain prescription drugs

download bill text pdf

Archive: Last Bill Status - In Senate Committee Health Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 08, 2020	referred to health
May 16, 2019	referred to health

2019-S5943 (ACTIVE) - Details

See Assembly Version of this Bill:: A7922
Current Committee:: Senate Health
Law Section:: Public Health Law
Laws Affected:: Amd §277, Pub Health L
Versions Introduced in Other Legislative Sessions:: 2021-2022: A741
2023-2024: A2861, A8836

2019-S5943 (ACTIVE) - Summary

Requires the commissioner of health to include in annual reports information regarding the cost and increase in cost of the ten prescription drugs on which the state expends the most money and which have had certain costs increased by fifty percent or more over the past five years or by ten percent or more during the previous calendar year.

2019-S5943 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S5943

SPONSOR: SALAZAR
 
TITLE OF BILL:  An act to amend the public health law, in relation to
requiring the commissioner of health to include in annual reports infor-
mation regarding the cost and increase in cost of certain prescription
drugs

 
PURPOSE:

The purpose of this bill is to require manufacturers to report to the
state how often the price of prescription drugs has increased and the
rationale for such increases.

 
SUMMARY OF PROVISIONS:

Section 1 amends subdivision 1 of section 277 of the public health law,
as amended by section 18 of part A of chapter 56 of the laws of 2013 to
require the commissioner and the drug utilization review board to
provide a list of the ten prescription drugs on which the state spent
the most money in the previous year, prescriptions that have increased

more than 10% of the wholesale cost in the previous year, and drugs that
have increased more than 50% over the previous five years. Manufacturers
of prescription drugs that appear on these lists shall be required to
provide a report explaining the rationale and factoring contributing to
the cost increase.

Section 2 provides the effective date.

 
JUSTIFICATION:

The exorbitant cost of prescription medications creates a barrier for
patients to receive the treatments they need and how pharmaceutical
companies set prices has been a mystery to the patients who need them.
Policymakers and the public would benefit from increased transparency,
including requiring pharmaceutical companies to disclose the research,
development, marketing and manufacturing costs, as well as the profits,
attributable to their drugs.

This legislation would require the state's Drug Utilization Review Board
(DURB) to identify up to 10 prescription drugs on which the state spends
significant health care dollars and for which the wholesale acquisition
cost has increased by 50 percent or more over the last five years or
increased by 10 percent or more over the last 12 months. The drug's
manufacturer would be required to provide an explanation to the DURB on
the pricing increase, including the factors contributing to the increase
and the role each factor played in the increase. The DURB would then
issue an annual report based on the information it receives, but would
be required to protect confidential commercial information and trade
secrets.

Given the double-digit growth in the price of prescription drugs, trans-
parency around the reasons for these increases would help in understand-
ing the impact increase in drug prices has on the health care costs for
employers and consumers and whether price increases are benefiting the
public by funding research and development that improve patient care or
are merely increasing the cost of health care.

 
LEGISLATIVE HISTORY:
This is a new bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately.

2019-S5943 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5943
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                               May 16, 2019
                                ___________
 
 Introduced  by  Sen. SALAZAR -- 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  requiring  the
   commissioner  of  health  to  include  in  annual  reports information
   regarding the cost and increase in cost of certain prescription drugs

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subdivision 1 of section 277 of the public health law, as
 amended by section 18 of part A of chapter 56 of the laws  of  2013,  is
 amended to read as follows:
   1.  The commissioner, in consultation with the drug utilization review
 board, shall undertake periodic  reviews,  at  least  annually,  of  the
 preferred drug program which shall include consideration of:
   (a)  the  volume of prior authorizations being handled, including data
 on the number and characteristics of prior  authorization  requests  for
 particular prescription drugs;
   (b) the quality of the program's responsiveness, including the quality
 of the administrator's responsiveness;
   (c) complaints received from patients and providers;
   (d)  (I)  A  LIST  OF  THE  TEN  PRESCRIPTION DRUGS ON WHICH THE STATE
 EXPENDS THE MOST MONEY AND FOR WHICH THE WHOLESALE ACQUISITION COST  HAS
 INCREASED  BY  FIFTY  PERCENT OR MORE OVER THE PAST FIVE YEARS OR BY TEN
 PERCENT OR MORE DURING THE  PREVIOUS  CALENDAR  YEAR.  THE  COMMISSIONER
 SHALL: INCLUDE THE PERCENTAGE OF THE WHOLESALE ACQUISITION COST INCREASE
 FOR  EACH  DRUG  ON THE LIST; RANK THE DRUGS ON THE LIST FROM THOSE WITH
 THE LARGEST INCREASE IN WHOLESALE ACQUISITION COST  TO  THOSE  WITH  THE
 SMALLEST  INCREASE;  INDICATE WHETHER EACH DRUG WAS INCLUDED ON THE LIST
 BASED ON ITS COST INCREASE OVER THE PAST FIVE YEARS OR DURING THE PREVI-
 OUS CALENDAR YEAR, OR BOTH; AND PROVIDE THE  STATE'S  TOTAL  EXPENDITURE
 FOR EACH DRUG ON THE LIST DURING THE MOST RECENT CALENDAR YEAR; AND
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD11425-01-9

 S. 5943                             2
 
   (II)  A  LIST OF THE TEN PRESCRIPTION DRUGS ON WHICH THE STATE EXPENDS
 THE MOST MONEY AND FOR WHICH THE COST TO THE STATE, NET OF  REBATES  AND
 OTHER PRICE CONCESSIONS, HAS INCREASED BY FIFTY PERCENT OR MORE OVER THE
 PAST  FIVE  YEARS OR BY TEN PERCENT OR MORE DURING THE PREVIOUS CALENDAR
 YEAR.  THE COMMISSIONER SHALL RANK THE DRUGS ON THE LIST FROM THOSE WITH
 THE GREATEST INCREASE IN NET COST TO THOSE WITH  THE  SMALLEST  INCREASE
 AND  INDICATE  WHETHER  EACH  DRUG WAS INCLUDED ON THE LIST BASED ON ITS
 COST INCREASE OVER THE PAST FIVE YEARS OR DURING THE  PREVIOUS  CALENDAR
 YEAR, OR BOTH; AND
   (III)  A MANUFACTURER OF A PRESCRIPTION DRUG THAT APPEARS ON A LIST AS
 DESCRIBED IN SUBPARAGRAPH (I) OR (II) OF THIS PARAGRAPH SHALL SUBMIT  TO
 THE  COMMISSIONER  A REPORT THAT EXPLAINS: (A) ALL MATERIAL FACTORS THAT
 HAVE CONTRIBUTED TO THE WHOLESALE ACQUISITION  COST  INCREASE  FOR  SUCH
 DRUG  INCLUDING  BUT  NOT  LIMITED TO MATERIALS AND MANUFACTURING COSTS,
 SPENDING ON RESEARCH AND DEVELOPMENT COSTS, SPENDING  ON  MARKETING  AND
 ADVERTISING,  AND  SPENDING  ON  PATIENT  ASSISTANCE  PROGRAMS;  (B) THE
 PERCENTAGE OF THE TOTAL WHOLESALE ACQUISITION COST INCREASE ATTRIBUTABLE
 TO EACH FACTOR; (C) AN  EXPLANATION  OF  THE  ROLE  OF  EACH  FACTOR  IN
 CONTRIBUTING  TO  THE WHOLESALE ACQUISITION COST INCREASE; (D) THE TOTAL
 REVENUE AND THE NET PROFIT OF  THE  MANUFACTURER  FOR  THE  MOST  RECENT
 CALENDAR  YEAR;  AND  (E)  ANY  ADDITIONAL  INFORMATION THE MANUFACTURER
 CHOOSES TO PROVIDE RELATED TO DRUG PRICING DECISIONS;
   (E) the savings attributable to the state, and to each county and  the
 city of New York, due to the provisions of this article;
   [(e)] (F) the aggregate amount of supplemental rebates received in the
 previous  fiscal  year and in the current fiscal year, to date; and such
 amounts are to be broken out by fiscal year and by month;
   [(f)] (G) the education and outreach program  established  by  section
 two hundred seventy-six of this [article] TITLE.
   § 2. This act shall take effect immediately.

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