SF 2645

Introduction - 94th Legislature (2025 - 2026)

Posted on 03/18/2025 10:03 a.m.

A bill for an act
relating to health; permitting Formulary Committee members with a potential
conflict of interest to participate in committee communications and discussions;
requiring the commissioner of human services to develop a public comment process
for recommendations to the Formulary Committee; requiring the Formulary
Committee to seek expertise from the Minnesota Rare Disease Advisory Council;
amending Minnesota Statutes 2024, section 256B.0625, subdivisions 13c, 13f,
13g.

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

Section 1.

Minnesota Statutes 2024, section 256B.0625, subdivision 13c, is amended to
read:

Subd. 13c.

Formulary Committee.

new text begin (a) new text end The commissioner, after receiving
recommendations from professional medical associations and professional pharmacy
associations, and consumer groups shall designate a Formulary Committee to carry out
duties as described in subdivisions 13 to 13g.

new text begin (b) new text end The Formulary Committee shall be comprised of at least five licensed physicians
actively engaged in the practice of medicine in Minnesota, one of whom is an actively
practicing psychiatrist, one of whom specializes in the diagnosis and treatment of rare
diseases, one of whom specializes in pediatrics, and one of whom actively treats persons
with disabilities; at least three licensed pharmacists actively engaged in the practice of
pharmacy in Minnesota, one of whom practices outside the metropolitan counties listed in
section 473.121, subdivision 4, one of whom practices in the metropolitan counties listed
in section 473.121, subdivision 4, and one of whom is a practicing hospital pharmacist; at
least two consumer representatives, all of whom must have a personal or professional
connection to medical assistance; and one representative designated by the Minnesota Rare
Disease Advisory Council established under section 256.4835; the remainder to be made
up of health care professionals who are licensed in their field and have recognized knowledge
in the clinically appropriate prescribing, dispensing, and monitoring of covered outpatient
drugs.

new text begin (c) new text end Members of the Formulary Committee shall not be employed by the Department of
Human Services or have a personal interest in a pharmaceutical company, pharmacy benefits
manager, health plan company, or their affiliate organizations, but the committee shall be
staffed by an employee of the department who shall serve as an ex officio, nonvoting member
of the committee.

new text begin (d) new text end For the purposes of this subdivision, "personal interest" means that a person owns
at least five percent of the voting interest or equity interest in the entity, the equity interest
owned by a person represents at least five percent of that person's net worth, or more than
five percent of a person's gross income for the preceding year was derived from the entity.

new text begin (e) new text end A committee member must notify the committee of any potential conflict of interest
and recuse themselves from any deleted text begin communications, discussion, or deleted text end vote on any matter where
a conflict of interest exists. A conflict of interest alone, without a personal interest, does
not preclude an applicant from serving as a member of the Formulary Committee. new text begin The
commissioner must publicly disclose any conflict of interest form submitted by a committee
member on the Department of Human Services' website at least 48 hours before any meeting
of the Formulary Committee that includes the drug subject to the conflict of interest on the
agenda.
new text end

new text begin (f) new text end Members may be removed from the committee for cause after a recommendation for
removal by a majority of the committee membership. For the purposes of this subdivision,
"cause" does not include offering a differing or dissenting clinical opinion on a drug or drug
class.

new text begin (g) new text end The department's medical director shall also serve as an ex officio, nonvoting member
for the committee.

new text begin (h) new text end Committee members shall serve three-year terms and may be reappointed twice by
the commissioner.

new text begin (i) new text end The committee members shall vote on a chair and vice chair from among their
membership. The chair shall preside over all committee meetings, and the vice chair shall
preside over the meetings if the chair is not present.

new text begin (j) new text end The Formulary Committee shall meet at least three times per year. The commissioner
may require more frequent Formulary Committee meetings as needed.

new text begin (k) new text end An honorarium of $100 per meeting and reimbursement for mileage shall be paid to
each committee member in attendance.

new text begin (l) new text end The Formulary Committee expires June 30, deleted text begin 2027 deleted text end new text begin 2030 new text end .

new text begin (m) new text end The Formulary Committee is subject to the Open Meeting Law under chapter 13D.
new text begin Notwithstanding the foregoing, this paragraph does not prevent:
new text end

new text begin (1) Formulary Committee staff communication with the representative designated by
the Minnesota Rare Disease Advisory Council or communication between Formulary
Committee staff and Minnesota Rare Disease Advisory Council staff unless a quorum of
the Formulary Committee members are included in the communication; or
new text end

new text begin (2) Formulary Committee members from seeking clinical expertise in advance of a
Formulary Committee meeting. Any such experts may submit, and may be encouraged by
Formulary Committee members to submit, public comments.
new text end

new text begin (n) new text end For purposes of establishing a quorum to transact business, vacant committee member
positions do not count in the calculation as long as at least 60 percent of the committee
member positions are filled.

new text begin (o) In accordance with section 256.4835, subdivision 4, paragraph (a), clause (2), the
Formulary Committee must, through the representative of the committee designated by the
Minnesota Rare Disease Advisory Council, seek subject matter expertise and input from
the Minnesota Rare Disease Advisory Council before taking action under the Formulary
Committee's authority relating to prior authorization requirements under subdivision 13f
or relating to placement of an orphan drug, as defined in section 152.01, subdivision 21, on
the preferred drug list under subdivision 13g. The commissioner is prohibited from entering
into or renewing a contract with a pharmacy benefit manager, as defined in section 62W.02,
that would limit the Formulary Committee's obligation and ability to seek the expertise and
input described in this paragraph.
new text end

new text begin (p) Within 30 days of Federal Drug Administration approval or modification of an orphan
drug, Formulary Committee staff must contact the representative designated by the Minnesota
Rare Disease Advisory Council in writing to initiate the process of seeking subject matter
expertise from the council. Formulary Committee staff must seek Rare Disease Advisory
Council expertise before receiving a recommendation from the vendor contracted with the
Department of Human Services for the purpose of participating in a preferred drug list and
supplemental rebate program. Once a recommendation is received from the vendor,
Formulary Committee staff must share with the Rare Disease Advisory Council any works
and documents created for the state that include a proposed action or proposed prior
authorization requirement. Once public notice is issued of a Formulary Committee meeting,
the Rare Disease Advisory Council may conduct public outreach activities related to any
proposed action or proposed prior authorization requirement as long as no communications
or activities include a quorum of the Formulary Committee, in compliance with the Open
Meeting Law.
new text end

Sec. 2.

Minnesota Statutes 2024, section 256B.0625, subdivision 13f, is amended to read:

Subd. 13f.

Prior authorization.

(a) The Formulary Committee shall review and
recommend drugs which require prior authorization. The Formulary Committee shall
establish general criteria to be used for the prior authorization of brand-name drugs for
which generically equivalent drugs are available, but the committee is not required to review
each brand-name drug for which a generically equivalent drug is available.

(b) Prior authorization may be required by the commissioner before certain formulary
drugs are eligible for payment. The Formulary Committee may recommend drugs for prior
authorization directly to the commissioner. The commissioner may also request that the
Formulary Committee review a drug for prior authorization. Before the commissioner may
require prior authorization for a drug:

(1) the commissioner must provide information to the Formulary Committee on the
impact that placing the drug on prior authorization may have on the quality of patient care
and on program costs, information regarding whether the drug is subject to clinical abuse
or misuse, and relevant data from the state Medicaid program if such data is available;

(2) the Formulary Committee must review the drug, taking into account medical and
clinical data and the information provided by the commissioner; deleted text begin and
deleted text end

(3) the Formulary Committee must hold a public forum and receive public comment for
an additional 15 days deleted text begin . deleted text end new text begin ; and
new text end

new text begin (4) the commissioner must publicly disclose public comments received during the public
comment period for each meeting on the Department of Human Services' website within
48 hours of receipt, not including weekends or holidays. All comments received must be
retained and publicly available for ... years.
new text end

The commissioner must provide a 15-day notice period before implementing the prior
authorization.

(c) Except as provided in subdivision 13j, prior authorization shall not be required or
utilized for any atypical antipsychotic drug prescribed for the treatment of mental illness
if:

(1) there is no generically equivalent drug available; and

(2) the drug was initially prescribed for the recipient prior to July 1, 2003; or

(3) the drug is part of the recipient's current course of treatment.

This paragraph applies to any multistate preferred drug list or supplemental drug rebate
program established or administered by the commissioner. Prior authorization shall
automatically be granted for 60 days for brand name drugs prescribed for treatment of mental
illness within 60 days of when a generically equivalent drug becomes available, provided
that the brand name drug was part of the recipient's course of treatment at the time the
generically equivalent drug became available.

(d) Prior authorization must not be required for liquid methadone if only one version of
liquid methadone is available. If more than one version of liquid methadone is available,
the commissioner shall ensure that at least one version of liquid methadone is available
without prior authorization.

(e) Prior authorization may be required for an oral liquid form of a drug, except as
described in paragraph (d). A prior authorization request under this paragraph must be
automatically approved within 24 hours if the drug is being prescribed for a Food and Drug
Administration-approved condition for a patient who utilizes an enteral tube for feedings
or medication administration, even if the patient has current or prior claims for pills for that
condition. If more than one version of the oral liquid form of a drug is available, the
commissioner may select the version that is able to be approved for a Food and Drug
Administration-approved condition for a patient who utilizes an enteral tube for feedings
or medication administration. This paragraph applies to any multistate preferred drug list
or supplemental drug rebate program established or administered by the commissioner. new text begin By
August 1, 2025, new text end the commissioner shall design and implement a streamlined prior
authorization form for patients who utilize an enteral tube for feedings or medication
administration and are prescribed an oral liquid form of a drug new text begin . The form must include an
option for a prescriber to check a box verifying that the patient utilizes an enteral tube for
feedings or medication administration. This verification is sufficient to establish the need
for the prior authorization automatic approval of the oral liquid form of the drug without
the requirement of any additional prior authorization forms or further documentation new text end . The
commissioner may require prior authorization for brand name drugs whenever a generically
equivalent product is available, even if the prescriber specifically indicates "dispense as
written-brand necessary" on the prescription as required by section 151.21, subdivision 2.

(f) Notwithstanding this subdivision, the commissioner may automatically require prior
authorization, for a period not to exceed 180 days, for any drug that is approved by the
United States Food and Drug Administration on or after July 1, 2005. The 180-day period
begins no later than the first day that a drug is available for shipment to pharmacies within
the state. The Formulary Committee shall recommend to the commissioner general criteria
to be used for the prior authorization of the drugs, but the committee is not required to
review each individual drug. In order to continue prior authorizations for a drug after the
180-day period has expired, the commissioner must follow the provisions of this subdivision.

(g) Prior authorization under this subdivision shall comply with section 62Q.184.

(h) Any step therapy protocol requirements established by the commissioner must comply
with section 62Q.1841.

(i) Notwithstanding any law to the contrary, prior authorization or step therapy shall not
be required or utilized for any class of drugs that is approved by the United States Food and
Drug Administration for the treatment or prevention of HIV and AIDS.

Sec. 3.

Minnesota Statutes 2024, section 256B.0625, subdivision 13g, is amended to read:

Subd. 13g.

Preferred drug list.

(a) The commissioner shall adopt and implement a
preferred drug list by January 1, 2004. The commissioner may enter into a contract with a
vendor for the purpose of participating in a preferred drug list and supplemental rebate
program. The terms of the contract with the vendor must be publicly disclosed on the website
of the Department of Human Services. The commissioner shall ensure that any contract
meets all federal requirements and maximizes federal financial participation. The
commissioner shall publish the preferred drug list annually in the State Register and shall
maintain an accurate and up-to-date list on the agency website. The commissioner shall
implement and maintain an accurate archive of previous versions of the preferred drug list,
and make this archive available to the public on the website of the Department of Human
Services beginning January 1, 2024.

(b) The commissioner may add to, delete from, and otherwise modify the preferred drug
list, after consulting with the Formulary Committee new text begin , the Rare Disease Advisory Council
for a product granted orphan drug designation by the Federal Drug Administration (FDA)
or indicated for orphan drug use by the FDA, new text end and appropriate medical specialists, providing
public notice and the opportunity for public comment, and complying with the requirements
of paragraph (f).

(c) The commissioner shall adopt and administer the preferred drug list as part of the
administration of the supplemental drug rebate program. Reimbursement for prescription
drugs not on the preferred drug list may be subject to prior authorization.

(d) For purposes of this subdivision, the following terms have the meanings given:

(1) "appropriate medical specialist" means a medical professional who prescribes the
relevant class of drug as part of their practice; and

(2) "preferred drug list" means a list of prescription drugs within designated therapeutic
classes selected by the commissioner, for which prior authorization based on the identity
of the drug or class is not required.

(e) The commissioner shall seek any federal waivers or approvals necessary to implement
this subdivision.

(f) Before the commissioner may delete a drug from the preferred drug list or modify
the inclusion of a drug on the preferred drug list, the commissioner shall consider any
implications that the deletion or modification may have on state public health policies or
initiatives and any impact that the deletion or modification may have on increasing health
disparities in the state. Prior to deleting a drug or modifying the inclusion of a drug, the
commissioner shall also conduct a public hearing. The commissioner shall provide adequate
notice to the public and the commissioner of health prior to the hearing that specifies the
drug that the commissioner is proposing to delete or modify, and shall disclose any public
medical or clinical analysis that the commissioner has relied on in proposing the deletion
or modification and evidence that the commissioner has evaluated the impact of the proposed
deletion or modification on public health and health disparities. new text begin The commissioner must
publicly disclose the required analysis disclosure and evidence of evaluation compliance
must be publicly disclosed on the Department of Human Services' website at least 30 days
before the hearing. new text end Notwithstanding section 331A.05, a public notice of a Formulary
Committee meeting must be published at least 30 days in advance of the meeting. The list
of drugs to be discussed at the meeting must be announced at least 30 days before the meeting
and must include the name and class of drug, the proposed action, and the proposed prior
authorization requirements, if applicable.