(a) The commissioner shall establish a drug formulary. Its establishment and publication shall not be subject to the requirements of the Administrative Procedure Act, but the Formulary Committee shall review and comment on the formulary contents.
(b) The formulary shall not include:
(1) drugs, active pharmaceutical ingredients, or products for which there is no federal funding;
(2) over-the-counter drugs, except as provided in subdivision 13;
(3) drugs or active pharmaceutical ingredients used for weight loss, except that medically necessary lipase inhibitors may be covered for a recipient with type II diabetes;
(4) drugs or active pharmaceutical ingredients when used for the treatment of impotence or erectile dysfunction;
(5) drugs or active pharmaceutical ingredients for which medical value has not been established; and
(6) drugs from manufacturers who have not signed a rebate agreement with the Department of Health and Human Services pursuant to section 1927 of title XIX of the Social Security Act.
(c) If a single-source drug used by at least two percent of the fee-for-service medical assistance recipients is removed from the formulary due to the failure of the manufacturer to sign a rebate agreement with the Department of Health and Human Services, the commissioner shall notify prescribing practitioners within 30 days of receiving notification from the Centers for Medicare and Medicaid Services (CMS) that a rebate agreement was not signed.