Assembly Bill A7789

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7789
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               June 15, 2023
                                ___________
 
 Introduced by M. of A. PAULIN -- read once and referred to the Committee
   on Health
 
 AN  ACT  to amend the public health law, in relation to establishing the
   340B prescription drug anti-discrimination act
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1.  Short  title. This act shall be known and may be cited as
 the "340B prescription drug anti-discrimination act".
   § 2. Declaration of purpose. Section 340B of the federal public health
 service act requires pharmaceutical manufacturers,  as  a  condition  of
 participation  in  Medicare and Medicaid, to provide discounts on outpa-
 tient drugs to certain providers that serve a high  number  of  Medicaid
 patients.  These  cost  savings  enable  safety-net providers to stretch
 scarce resources as far as  possible  in  providing  more  comprehensive
 services to their communities.
   In  recent  years,  some pharmaceutical companies and pharmacy benefit
 managers have imposed certain requirements and limitations on  New  York
 340B  covered entities, thus depriving such entities of much-needed cost
 savings. These practices discriminate against 340B covered entities  and
 their pharmacy partners, and by extension the patients they serve. These
 discriminatory practices have the effect of limiting those covered enti-
 ties' ability to care for their communities fully and comprehensively.
   There  is  a need for the state to prevent erosion of our 340B covered
 entities' 340B cost savings, with its  concomitant  impacts  on  patient
 access  to  health  care  services. This act is intended to achieve that
 goal by prohibiting pharmaceutical companies, among other entities, from
 engaging in practices that discriminate against  340B  covered  entities
 and their pharmacy partners.
   § 3. The public health law is amended by adding a new section 280-d to
 read as follows:
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD11664-01-3
 A. 7789                             2
              

 
   § 280-D. PRESCRIPTION DRUG DISCRIMINATION PROHIBITED.  1. DEFINITIONS.
 (A)  "340B  PROGRAM"  SHALL MEAN THE DRUG DISCOUNT PROGRAM AUTHORIZED BY
 SECTION 340B OF THE FEDERAL PUBLIC  HEALTH  SERVICE  ACT  (42  U.S.C.  §
 256B).
   (B) "COVERED ENTITY" SHALL:
   (I) HAVE THE SAME MEANING AS IS SET FORTH IN SECTION 340B(A)(4) OF THE
 FEDERAL PUBLIC HEALTH SERVICE ACT (42 U.S.C. § 256B);
   (II) MEAN AN ENTITY AUTHORIZED TO PARTICIPATE IN THE 340B PROGRAM; AND
   (III)  INCLUDE  NEW YORK STATE PHARMACIES THAT RECEIVE DRUGS PURCHASED
 UNDER A CONTRACT PHARMACY ARRANGEMENT WITH A COVERED ENTITY.
   (C) "DISPENSING" SHALL INCLUDE A PHARMACY'S ENTIRE DISTRIBUTION  PROC-
 ESS,  INCLUDING  THE ORDERING, PURCHASING, DELIVERING, RECEIPT, AND SALE
 OF DRUGS, AND ANY OTHER ASPECT OF  SUCH  DISTRIBUTION  PROCESS  THAT  AN
 ENTITY MAY SEEK TO DENY, PROHIBIT, CONDITION, OR OTHERWISE LIMIT.
   (D)  "PHARMACY" SHALL HAVE THE SAME MEANING AS IS SET FORTH IN SECTION
 SIXTY-EIGHT HUNDRED TWO OF THE EDUCATION LAW.
   2. PROHIBITION OF DISCRIMINATORY PRACTICE. NO  ENTITY,  INCLUDING  BUT
 NOT  LIMITED TO A PHARMACEUTICAL MANUFACTURER OR PHARMACY BENEFIT MANAG-
 ER, SHALL:
   (A) DENY, PROHIBIT, CONDITION, OR OTHERWISE LIMIT  THE  DISPENSING  OF
 DRUGS FROM A COVERED ENTITY;
   (B) DENY ACCESS TO DRUGS MANUFACTURED BY A PHARMACEUTICAL MANUFACTURER
 TO  A COVERED ENTITY BASED ON SUCH COVERED ENTITY'S PARTICIPATION IN THE
 340B PROGRAM;
   (C)  IMPOSE  REQUIREMENTS,  EXCLUSIONS,  REIMBURSEMENT  TERMS,   FEES,
 AUDITS,  CLAIM  IDENTIFICATION,  OR OTHER CONDITIONS ON A COVERED ENTITY
 THAT DIFFER FROM  THE  REQUIREMENTS,  EXCLUSIONS,  REIMBURSEMENT  TERMS,
 FEES, AUDITS, CLAIM IDENTIFICATION, OR OTHER CONDITIONS APPLIED TO ENTI-
 TIES THAT DO NOT PARTICIPATE IN THE 340B PROGRAM.
   3.  ENFORCEMENT.  (A)  ANY PROVISION OF A CONTRACT THAT IS CONTRARY TO
 THIS ACT SHALL BE VOID AND UNENFORCEABLE.
   (B) THE COMMISSIONER SHALL HAVE THE AUTHORITY TO IMPOSE A CIVIL  MONE-
 TARY  PENALTY  PURSUANT  TO SECTION TWELVE OF THIS CHAPTER ON ANY ENTITY
 THAT VIOLATES THE PROVISIONS OF THIS ACT.
   (C) THE COMMISSIONER SHALL REFER ANY MATTERS IN WHICH A CIVIL MONETARY
 PENALTY IS BEING IMPOSED TO THE EDUCATION DEPARTMENT AND THE  OFFICE  OF
 THE ATTORNEY GENERAL FOR REVIEW.
   § 4. This act shall take effect immediately.