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HF 3538

as introduced - 90th Legislature (2017 - 2018) Posted on 03/28/2018 01:45pm

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to health; requiring cost disclosure for qualifying prescription drugs;
requiring a report; proposing coding for new law in Minnesota Statutes, chapter
144.

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

Section 1.

new text begin [144.7031] PRESCRIPTION DRUG COST TRANSPARENCY.
new text end

new text begin Subdivision 1. new text end

new text begin Intent and findings. new text end

new text begin It is the intent of the legislature to make
pharmaceutical pricing as transparent as possible. To fulfill this goal, the legislature finds
that there should be annual cost reporting on the most expensive drugs that would allow
policy makers, government agencies, and others to understand costs for these important
products.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin (a) For purposes of this section, the following definitions apply.
new text end

new text begin (b) "Manufacturer" has the meaning provided in section 151.01, subdivision 14a.
new text end

new text begin (c) "Wholesale acquisition cost" or "WAC" means the manufacturer's list price for a
drug or biological to wholesalers or direct purchasers in the United States, not including
prompt pay or other 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 or biological pricing data.
new text end

new text begin Subd. 3. new text end

new text begin Cost reporting for qualifying drugs. new text end

new text begin (a) Each manufacturer of a prescription
drug, made available in Minnesota, that has a wholesale acquisition cost of $10,000 or more
annually or per course of treatment, shall file a report with the commissioner as provided
in this subdivision on the costs for each qualifying drug.
new text end

new text begin (b) The report shall include all of the following for each qualifying drug:
new text end

new text begin (1) the total costs for the production of the drug, including all of the following:
new text end

new text begin (i) the total research and development costs paid by the manufacturer, and separately
the total research and development costs paid by any predecessor in the development of the
drug;
new text end

new text begin (ii) the total costs of clinical trials and other regulatory costs paid by the manufacturer,
and separately the total costs of clinical trials and other regulatory costs paid by any
predecessor in the development of the drug;
new text end

new text begin (iii) the total costs for materials, manufacturing, and administration attributable to the
drug;
new text end

new text begin (iv) the total costs paid by any entity other than the manufacturer or predecessor for
research and development, including any amount from federal, state, or other governmental
programs or any form of subsidies, grants, or other support;
new text end

new text begin (v) any other costs to acquire the drug, including all or any costs for the purchase of
patents, licensing, or acquisition of any corporate entity owning any rights to the drug while
in development; and
new text end

new text begin (vi) the total marketing and advertising costs for the promotion of the drug directly to
consumers, including but not limited to costs associated with direct-to-consumer coupons
and the amount redeemed, total marketing and advertising costs for promotion of the drug
directly or indirectly to prescribers, and any other advertising for the drug;
new text end

new text begin (2) a cumulative annual history of average wholesale price (AWP) and WAC increases
for the drug, expressed as percentages, including the month each increase in each category,
AWP and WAC, took effect;
new text end

new text begin (3) the total profit attributable to the drug as represented in total dollars and as a
percentage of the total company profits that were derived from the sale of the drug; and
new text end

new text begin (4) the total amount of financial assistance the manufacturer has provided through patient
prescription assistance programs, if available.
new text end

new text begin (c) All of the information in paragraph (b) shall be itemized and documented by the
manufacturer and audited by a fully independent third-party auditor prior to filing.
new text end

new text begin (d) No later than May 1, 2019, and each May 1 thereafter, manufacturers shall file the
information required by this subdivision annually with the commissioner on a form prescribed
by the commissioner.
new text end

new text begin Subd. 4. new text end

new text begin Report to legislature. new text end

new text begin No later than August 1, 2019, and each August 1
thereafter, the commissioner shall issue a report annually to the legislature summarizing
the information submitted under this section. The commissioner shall also make the report
available to the public on the agency Web site.
new text end

new text begin Subd. 5. new text end

new text begin Advisory committee. new text end

new text begin The commissioner shall convene an advisory committee
to develop the form required by this section. The committee shall include, but is not limited
to, representatives of the pharmaceutical industry, health carriers, pharmacy benefit managers,
state agencies, consumer advocates, pharmacists, and physicians.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end