HF 289

1st Engrossment - 91st Legislature (2019 - 2020) Posted on 03/14/2019 04:32pm

A bill for an act
relating to health care; requiring the reporting of the cost of prescription drugs that
are used to treat diabetes; proposing coding for new law in Minnesota Statutes,
chapter 62J.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [62J.84] DIABETES DRUG COST TRANSPARENCY.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Manufacturer" means any manufacturer that is required to be licensed under section
151.252.
new text end

new text begin (c) "Pharmacy" has the meaning provided in section 151.01, subdivision 2.
new text end

new text begin (d) "Pharmacy benefit manager" has the meaning provided in section 151.71, subdivision
1.
new text end

new text begin (e) "Wholesale acquisition cost" means the manufacturer's list price for a prescription
drug to wholesalers or direct purchasers in the United States, not including any discounts,
rebates, or reductions in price for the most recent month for which information is available,
as reported in wholesale price guides or other publications of drug pricing data.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner's duties. new text end

new text begin (a) By February 1 of each year beginning February
1, 2020, the commissioner shall compile a list of prescription drugs that the commissioner
determines to be essential for treating diabetes in Minnesota, including all forms of insulin,
all oral diabetes medications, and all noninsulin injectable medications marketed for sale
in Minnesota and the wholesale acquisition cost of each drug on the list.
new text end

new text begin (b) By March 1 of each year beginning March 1, 2020, the commissioner shall compile
a list using the list described in paragraph (a) of drugs that have been subject to an increase
in the wholesale acquisition cost of a percentage equal to or greater than:
new text end

new text begin (1) the percentage increase in the All-Items Consumer Price Index during the immediately
preceding calendar year; or
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new text begin (2) the average annual percentage increase in the All-Items Consumer Price Index during
the immediately preceding two calendar years.
new text end

new text begin Subd. 3. new text end

new text begin Manufacturer's duties. new text end

new text begin (a) By April 1 of each year beginning April 1, 2020,
the manufacturer of each prescription drug included in the most current list compiled by
the commissioner under subdivision 2, paragraph (a), shall prepare and submit to the
commissioner in a format prescribed by the commissioner, a report that includes the following
for each drug listed:
new text end

new text begin (1) the costs of producing the drug, excluding research and development costs and
including the total nonresearch and development administrative expenditures relating to the
drug, including marketing and advertising costs;
new text end

new text begin (2) the total amount of financial assistance that the manufacturer has provided through
any patient prescription assistance program, including the number of patients who received
financial assistance, the total amounts of prescription drugs listed under subdivision 2,
paragraph (a), provided to these patients, and the average length of time patients received
financial assistance from a patient prescription assistance program;
new text end

new text begin (3) the cost associated with coupons provided directly to consumers and for programs
to assist consumers in paying co-payments, and the cost to the manufacturer attributable to
the redemption of those coupons and the use of those programs. Costs reported under this
clause shall include information on the numbers of patients who redeemed coupons or
received financial assistance from a co-payment assistance program, the numbers of
prescriptions filled using a coupon, the number of prescriptions filled using a co-payment
assistance program, the amounts of prescription drugs listed under subdivision 2, paragraph
(a), provided to patients who redeemed coupons, and the amounts of prescription drugs
listed under subdivision 2, paragraph (a), provided to patients who received financial
assistance from a co-payment assistance program;
new text end

new text begin (4) the aggregate amount of all rebates and all other fees that the manufacturer has
provided to pharmacy benefit managers for sales of the drug within Minnesota; and
new text end

new text begin (5) any additional information deemed necessary by the commissioner for the purpose
of analyzing the cost of drugs that are included in the list described in subdivision 2,
paragraph (a).
new text end

new text begin (b) By April 1 of each year beginning April 1, 2020, for each drug that is included in
the list compiled by the commissioner under subdivision 2, paragraph (b), the manufacturer
shall submit to the commissioner a report describing the reasons for the increase in the
wholesale acquisition cost of the drug listed. The report must include:
new text end

new text begin (1) a list of each factor that has contributed to the increase;
new text end

new text begin (2) the percentage of the total increase that is attributable to each factor;
new text end

new text begin (3) an explanation of the role of each factor in the increase; and
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new text begin (4) any additional information deemed necessary by the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Pharmacy benefit manager duties. new text end

new text begin By May 1 of each year beginning May 1,
2020, each pharmacy benefit manager shall submit to the commissioner a report that includes:
new text end

new text begin (1) the total amount of rebates and all other fees that the pharmacy benefit manager
received from manufacturers during the preceding calendar year for all of the pharmacy
benefit manager's health plan company clients and for each health plan company client, for
prescription drugs included in the list compiled by the commissioner under subdivision 2,
paragraph (a). The total amount of rebates must include any utilization discounts the
pharmacy benefit manager received from a manufacturer;
new text end

new text begin (2) the total amount of all rebates and all other fees under clause (1) that were retained
by the pharmacy benefit manager;
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new text begin (3) the total amount of all rebates and all other fees under clause (1) that were received
for purchases of drugs for use by:
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new text begin (i) recipients of Medicare;
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new text begin (ii) recipients of medical assistance;
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new text begin (iii) persons covered by third-party payers that are governmental entities that are not
included in item (i) or (ii);
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new text begin (iv) persons covered by third parties that are not governmental entities; and
new text end

new text begin (v) persons covered by a health plan described under paragraph (b) if the health plan
requires the pharmacy benefit manager to comply;
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new text begin (4) the percentage of rebates that were retained by the pharmacy benefit manager, and
the percentage of all other fees that were retained by the pharmacy benefit manager, for
prescription drugs included in the list compiled by the commissioner under subdivision 2,
paragraph (a); and
new text end

new text begin (5) the highest, lowest, and mean total retained rebate and fees percentages for
prescription drugs included in the list compiled by the commissioner under subdivision 2,
paragraph (a), for all of the pharmacy benefit manager's health plan company clients and
for each health plan company client.
new text end

new text begin Subd. 5. new text end

new text begin Health plan company's duties. new text end

new text begin Each health plan company as part of the rate
approval process under section 62A.02 shall submit to the commissioner of commerce the
following information regarding the prescription drugs included on the list compiled by the
commissioner under subdivision 2, paragraph (a):
new text end

new text begin (1) the percentage of the premium attributable to these prescription drugs for the prior
plan year;
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new text begin (2) the percentage of premium attributable to costs for these prescription drugs for the
plan year for which the rate approval is submitted;
new text end

new text begin (3) the year-over-year change, as a percentage, in total spending for these prescription
drugs;
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new text begin (4) the year-over-year change in per-member, per-month plan costs for these prescription
drugs compared to other components of the health care premium;
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new text begin (5) the year-over-year change in average plan enrollee annual cost-sharing for these
prescription drugs;
new text end

new text begin (6) information on its use of a pharmacy benefit manager, if any, and which components
of the prescription drug benefit is managed by the pharmacy benefit manager;
new text end

new text begin (7) total rebates and discounts for the prescription drugs received from the pharmacy
benefit manager;
new text end

new text begin (8) a description of how pharmacy benefit manager discounts impact plan decisions
regarding patient cost-sharing amounts; and
new text end

new text begin (9) total amount of administrative fees paid to pharmacy benefit managers for the previous
plan year for these prescription drugs.
new text end

new text begin Subd. 6. new text end

new text begin Pharmacy duties. new text end

new text begin By May 1 of each year beginning May 1, 2020, each
pharmacy licensed under chapter 151 shall submit to the commissioner a report that includes
the following information regarding the prescription drugs included on the list compiled by
the commissioner under subdivision 2, paragraph (a):
new text end

new text begin (1) total payment received from pharmacy benefit managers for these prescription drugs
during the previous calendar year;
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new text begin (2) total payments received from health plans for these prescription drugs during the
previous calendar year;
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new text begin (3) total payments made to wholesalers, distributors, or manufacturers, to purchase drugs
during the previous calendar year; and
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new text begin (4) total fees paid to pharmacy benefit managers for these prescription drugs during the
previous calendar year.
new text end

new text begin Subd. 7. new text end

new text begin Report. new text end

new text begin (a) By June 1 of each year beginning June 1, 2020, the commissioner
shall analyze the information submitted under subdivisions 2, 3, and 4 and submit a report
to the legislature on the price of prescription drugs that appear on the most current lists
pursuant to subdivision 2, the reasons for any increases in those prices, the extent to which
rebates and other fees paid to pharmacy benefit managers contribute to price increases for
the prescription drugs that appear on the most current lists pursuant to subdivision 2, and
the effect of those prices on overall spending on prescription drugs in Minnesota. The
commissioner may include recommendations on how to lower the cost of drugs used for
the treatment of diabetes while maintaining access to the drugs.
new text end

new text begin (b) The commissioner shall make the report described in paragraph (a) available to the
public.
new text end