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Minnesota Legislature

Office of the Revisor of Statutes

SF 2942

1st Engrossment - 89th Legislature (2015 - 2016) Posted on 03/31/2016 08:46am

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - 1st Engrossment

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A bill for an act
relating to health; requiring cost disclosure for qualifying prescription drugs;
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
policymakers, 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
(WAC) of $1,000 or more per month or per course of treatment, shall file a report with the
commissioner as provided in this subdivision on the cost 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 cost for the production of the drug, including all of the following:
new text end

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

new text begin (ii) the total cost of clinical trials and other regulatory costs paid by the manufacturer,
and separately, the total cost 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 cost for materials, manufacturing, and administration attributable to
the drug;
new text end

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

new text begin (vi) the total marketing and advertising cost for the promotion of the drug directly
to consumers including, but not limited to, the cost associated with direct-to-consumer
coupons and the amount redeemed, total marketing and advertising cost 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) Manufacturers shall file the information required by this subdivision annually
with the commissioner on a form prescribed by the commissioner, no later than May 1,
2017, and each May 1 thereafter.
new text end

new text begin Subd. 4. new text end

new text begin Report to the legislature. new text end

new text begin The commissioner shall issue a report annually
to the legislature, no later than August 1, 2017, and each August 1 thereafter, 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 develop the form required
by this section, and shall consult with 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