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General Assembly Raised Bill No. 260
February Session, 2022
LCO No. 2224
Referred to Committee on AGING
Introduced by:
(AGE)
AN ACT CONCERNING A PRESCRIPTION DRUG COST CONTROL
BOARD.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. (NEW) (Effective October 1, 2022) (a) There is hereby 1
established the Prescription Drug Cost Control Board, a body politic and 2
corporate, constituting a public instrumentality and political 3
subdivision of the state established and created for the performance of 4
an essential public and governmental function. The board shall not be 5
construed to be a department, institution or agency of the state. 6
(b) The purposes of the Prescription Drug Cost Control Board shall 7
be to monitor prescription drug prices in the state and recommend 8
upper price limits on prescription drugs to the Insurance Commissioner. 9
(c) The powers of the board shall be vested in and exercised by a 10
board of directors, which shall consist of five voting members and three 11
voting alternate members, with expertise in health care, economics and 12
clinical medicine, appointed by the Governor and confirmed by the 13
Senate to serve for five-year terms. The chairperson of the board shall 14 Raised Bill No. 260
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be appointed by the Governor, with the advice and consent of both 15
houses of the General Assembly, and shall serve at the pleasure of the 16
Governor. Alternate members shall, when seated as provided in this 17
section, have all powers and duties of a member of the board. If a regular 18
member of the board is absent or has a conflict of interest, the 19
chairperson of the board shall designate an alternate to so act, choosing 20
alternates in rotation so that they shall act as nearly equal a number of 21
times as possible. If any alternate is not available in accordance with 22
such rotation, such fact shall be recorded in the minutes of the meeting. 23
A member or alternate member shall serve until a successor is 24
appointed. 25
(d) Any vacancy occurring other than by expiration of term shall be 26
filled in the same manner as the original appointment for the balance of 27
the unexpired term. The Governor may remove a member for any one 28
or more of the following: Wilful neglect of duty, misfeasance or 29
malfeasance. 30
(e) Each member of the board shall be entitled to reimbursement for 31
such member's actual and necessary expenses incurred during the 32
performance of such member's official duties. 33
(f) Members of the board may engage in private employment, or in a 34
profession or business, subject to any applicable laws, rules and 35
regulations of the state regarding official ethics or conflict of interest. It 36
shall not constitute a conflict of interest for a trustee, director, partner or 37
officer of any person, firm or corporation, or any individual having a 38
financial interest in a person, firm or corporation, to serve as a board 39
member of the board, provided such trustee, director, partner, officer or 40
individual shall abstain from deliberation, action or vote by the board 41
in specific request to such person, firm or corporation. 42
(g) The board shall meet not less than four times annually to review 43
prescription drug product information. A majority of the members of 44
the board shall constitute a quorum for the transaction of any business 45
or the exercise of any power of the board. 46 Raised Bill No. 260
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(h) In carrying out its purposes, the board may: 47
(1) Assess and collect fees from prescription drug manufacturers 48
doing business in the state to be used exclusively to finance the work of 49
the board, provided the board shall account for and audit funds of the 50
board; 51
(2) Maintain an office at such place or places as it may designate and 52
an Internet web site; 53
(3) (A) Employ such assistants, agents and other employees as may 54
be necessary or desirable who shall not be employees, as defined in 55
subsection (b) of section 5-270 of the general statutes; (B) establish all 56
necessary or appropriate personnel practices and policies, including 57
those relating to hiring, promotion, compensation, retirement and 58
collective bargaining, which need not be in accordance with chapter 68 59
of the general statutes, and the board shall not be an employer as 60
defined in subsection (a) of section 5-270 of the general statutes; and (C) 61
engage consultants, attorneys and appraisers as may be necessary or 62
desirable to carry out its purposes in accordance with this section and 63
section 3 of this act; 64
(4) Receive and accept aid or contributions from any source of money, 65
property, labor or other things of value, to be held, used and applied to 66
carry out the purposes of the board, provided acceptance of such aid or 67
contributions does not present a conflict of interest for any board 68
member or staff hired pursuant to subdivision (3) of this subsection; and 69
(5) Make and enter into all contracts and agreements necessary or 70
incidental to the performance of its duties and the execution of its 71
powers, including contracts and agreements for such professional 72
services as the board deems necessary, including, but not limited to, 73
financial consultants, counsel, underwriters and technical specialists. 74
(i) (1) The chairperson of the board shall provide to the Insurance 75
Commissioner the name of any prescription drug manufacturer that 76
fails to pay any assessment or fee under subdivision (1) of subsection (h) 77 Raised Bill No. 260
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of this section to the board. The Insurance Commissioner shall see that 78
all laws respecting the board's authority pursuant to said subdivision 79
are faithfully executed. The commissioner has all the powers that are 80
reasonable and necessary to enforce the provisions of said subdivision. 81
(2) Any prescription drug manufacturer aggrieved by an 82
administrative action taken by the commissioner under subdivision (1) 83
of this subsection may appeal therefrom in accordance with the 84
provisions of section 4-183, except venue for such appeal shall be in the 85
judicial district of New Britain. 86
(j) The members of the Prescription Drug Cost Control Board shall 87
adopt written procedures, in accordance with the provisions of section 88
1-121 of the general statutes, for: (1) Adopting an annual budget and 89
plan of operations, including a requirement of board approval before 90
the budget or plan may take effect; (2) hiring, dismissing, promoting and 91
compensating employees of the board, including an affirmative action 92
policy and a requirement of board approval before a position may be 93
created or a vacancy filled; (3) acquiring personal property and personal 94
services, including a requirement of board approval for any 95
nonbudgeted expenditure in excess of an amount to be determined by 96
the board; (4) contracting for financial, legal and other professional 97
services, including a requirement that the board solicit proposals at least 98
once every three years for each such service which it uses; and (5) the 99
use of surplus funds. 100
Sec. 2. (NEW) (Effective October 1, 2022) As used in this section and 101
sections 3 and 4 of this act: 102
(1) "Biologic" means a drug licensed under 42 USC 262; 103
(2) "Biosimilar" means a drug that is highly similar to a biologic and 104
is produced or distributed in accordance with a biologics license 105
application approved under 42 USC 262, as amended from time to time; 106
(3) "Board" means the Prescription Drug Cost Control Board 107
established pursuant to section 1 of this act; 108 Raised Bill No. 260
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(4) "Brand name drug" means a drug that is produced or distributed 109
in accordance with an original new drug application approved under 21 110
USC 355, as amended from time to time, but does not include a generic 111
drug as defined in 42 CFR 447.502, as amended from time to time; 112
(5) "Generic drug" means (A) a prescription drug product that is 113
marketed or distributed in accordance with an abbreviated new drug 114
application approved under 21 USC 355, as amended from time to time, 115
(B) a generic drug as defined in 42 CFR 447.502, as amended from time 116
to time, or (C) a drug that entered the market before calendar year 1962 117
that was not originally marketed under a new prescription drug product 118
application; 119
(6) "Manufacturer" means an entity that (A) engages in the 120
manufacture of a drug product, or (B) enters into a lease with another 121
manufacturer to market and distribute a prescription drug product 122
under the entity's own name and sets or changes the wholesale 123
acquisition cost of the prescription drug product it manufactures or 124
markets; 125
(7) "Prescription drug product" means a brand name drug, a generic 126
drug, a biologic or biosimilar; and 127
(8) "Stakeholder council" means the Prescription Drug Affordability 128
Stakeholder Council established pursuant to section 4 of this act. 129
Sec. 3. (NEW) (Effective October 1, 2022) (a) To the extent practicable, 130
the Prescription Drug Cost Control Board shall access pricing 131
information for prescription drug products by: (1) Entering into a 132
memorandum of understanding with another state to which a 133
manufacturer already reports pricing information, (2) assessing 134
spending for the drug in the state, and (3) accessing other available 135
pricing information. 136
(b) The board shall identify prescription drug products that, as 137
adjusted annually for inflation in accordance with the consumer price 138
index for all urban consumers, as published by the United States 139 Raised Bill No. 260
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Department of Labor, Bureau of Labor Statistics, are: 140
(1) Brand name drugs that have a launch wholesale acquisition cost 141
of thirty thousand dollars or more per year or course of treatment; 142
(2) Brand name drugs that have a wholesale acquisition cost increase 143
of three thousand dollars or more in any twelve–month period; 144
(3) Biosimilars that have a launch wholesale acquisition cost that is 145
not at least fifteen per cent lower than the referenced brand biologic at 146
the time the biosimilars are launched; and 147
(4) Generic drugs that have: 148
(A) A wholesale acquisition cost of one hundred dollars or more for 149
(i) a thirty-day supply lasting a patient for a period of thirty consecutive 150
days based on the recommended dosage approved for labeling by the 151
United States Food and Drug Administration, (ii) a supply lasting a 152
patient for fewer than thirty days based on the recommended dosage 153
approved for labeling by the United States Food and Drug 154
Administration, or (iii) one unit of the drug if the labeling approved by 155
the United States Food and Drug Administration does not recommend 156
a finite dosage; and 157
(B) A wholesale acquisition cost that increased by two hundred per 158
cent or more during the immediately preceding twelve-month period, 159
as determined by the difference between the resulting wholesale 160
acquisition cost and the average of the wholesale acquisition cost 161
reported over the immediately preceding twelve months. 162
(c) The board shall identify other prescription drug products that 163
may create affordability challenges for the health care system in the state 164
or patients, including, but not limited to, drugs needed to address public 165
health emergencies. 166
(d) After identifying prescription drug products as required by 167
subsections (b) and (c) of this section, the board shall determine whether 168
to conduct an affordability review for each identified prescription drug 169 Raised Bill No. 260
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product by seeking (1) input from the stakeholder council, and (2) 170
considering the average patient cost share of the prescription drug 171
product. 172
(e) In conducting an affordability review of prescription drugs, the 173
board may examine any document and research relate d to the 174
manufacturer's selection of the introductory price or price increase of 175
the prescription drug product, including, but not limited to, (1) net 176
average price in the state, (2) market competition and context, (3) 177
projected revenue to the manufacturer, and (4) the estimated value or 178
cost effectiveness of the prescription drug product. 179
(f) The board shall determine whether use of the prescription drug 180
product, consistent with the labeling approved by the United States 181
Food and Drug Administration or standard medical practice, has led or 182
will lead to affordability challenges for the health care system in the 183
state or high out–of–pocket costs for patients. In determining whether a 184
prescription drug product has led or will lead to an affordability 185
challenge, the board shall consider the following factors: 186
(1) The wholesale acquisition cost for the prescription drug product 187
sold in the state; 188
(2) The average monetary price concession, discount or rebate the 189
manufacturer provides to health plans in the state or is expected to 190
provide to health plans in the state as reported by manufacturers and 191
health plans, expressed as a per cent of the wholesale acquisition cost 192
for the prescription drug product under review; 193
(3) The total amount of the price concession, discount or rebate the 194
manufacturer provides to each pharmacy benefits manager operating in 195
the state for the prescription drug product under review, as reported by 196
manufacturers and pharmacy benefits managers, expressed as a per cent 197
of the wholesale acquisition costs; 198
(4) The price at which therapeutic alternatives have been sold in the 199
state; 200 Raised Bill No. 260
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(5) The average monetary concession, discount or rebate the 201
manufacturer provides or is expected to provide to health plan payors 202
and pharmacy benefits managers in the state for therapeutic 203
alternatives; 204
(6) The costs to health plans based on patient access consistent with 205
United States Food and Drug Administration labeled indications and 206
recognized standard medical practice; 207
(7) The impact on patient access resulting from the cost of the 208
prescription drug product relative to health plan benefit design; 209
(8) The current or expected dollar value of drug–specific patient 210
access programs that are supported by the manufacturer; 211
(9) The relative financial impacts to health, medical or social services 212
costs as can be quantified and compared to baseline effects of existing 213
therapeutic alternatives; 214
(10) The average patient copayment or other cost sharing for the 215
prescription drug product in the state; 216
(11) Any information a manufacturer chooses to provide; and 217
(12) Any other factors as determined by the board. 218
(g) If the board finds that the spending on a prescription drug 219
product reviewed under this section has led or will lead to an 220
affordability challenge, the board shall recommend an upper payment 221
limit to the Insurance Commissioner after considering: (1) The cost of 222
administering the drug, (2) the cost of delivering the drug to patients, 223
and (3) other relevant administrative costs related to the drug. 224
(h) Any conflict of interest involving a member of the board shall be 225
disclosed at the next board meeting after the conflict is identified and on 226
the board's Internet web site. 227
(i) The board's recommendations shall not apply to Medicare Part D 228 Raised Bill No. 260
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prescription drug plans. 229
(j) On or before December 31, 2023, and annually thereafter, the board 230
shall submit a report, in accordance with the provisions of section 11-4a 231
of the general statutes, to the joint standing committees of the General 232
Assembly having cognizance of matters relating to aging, human 233
services, insurance and public health. The report shall include, but not 234
be limited to: (1) Price trends for prescription drug products, (2) the 235
number of such products subject to board review, (3) the results of the 236
reviews, and (4) any recommendations the board may have on further 237
legislation needed to make prescription drug products more affordable 238
in the state. 239
Sec. 4. (NEW) (Effective October 1, 2022) (a) There is established a 240
Prescription Drug Affordability Stakeholder Council to advise the board 241
on decisions regarding the affordability of prescription drugs. 242
(b) Members of the council shall serve for three years and shall consist 243
of: 244
(1) Three appointed by the speaker of the House of Representatives, 245
who shall be (A) a representative of a state-wide health care advocacy 246
coalition, (B) a representative of a state-wide advocacy organization for 247
elderly persons, and (C) a representative of a state-wide organization 248
for diverse communities; 249
(2) Three appointed by the president pro tempore of the Senate, who 250
shall be (A) a representative of a labor union, (B) a health services 251
researcher, and (C) a consumer who has experienced barriers to 252
obtaining prescription drugs due to the cost of such drugs; 253
(3) Two appointed by the majority leader of the House of 254
Representatives, who shall be (A) a representative of doctors, and (B) a 255
representative of nurses; 256
(4) Two appointed by the minority leader of the House of 257
Representatives, who shall be (A) a representative of private insurers, 258 Raised Bill No. 260
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and (B) a representative of brand name drug corporations; 259
(5) Two appointed by the minority leader of the Senate, who shall be 260
(A) a representative of generic drug corporations, and (B) a 261
representative of an academic institution with expertise in health care 262
costs; 263
(6) Two appointed by the Governor, who shall be (A) a representative 264
of pharmacists, and (B) a representative of pharmacy benefit managers; 265
(7) The Secretary of the Office of Policy and Management, or the 266
secretary's designee; 267
(8) The Commissioner of Social Services, or the commissioner's 268
designee; 269
(9) The Commissioner of Public Health, or the commissioner's 270
designee; 271
(10) The Insurance Commissioner, or the commissioner's designee; 272
(11) The Commissioner of Consumer Protection, or the 273
commissioner's designee; 274
(12) The executive director of the Office of Health Strategy, or the 275
executive director's designee; and 276
(13) The Healthcare Advocate, or the Healthcare Advocate's 277
designee. 278
(c) All initial appointments to the council shall be made not later than 279
thirty days after the effective date of this section. Any vacancy shall be 280
filled by the appointing authority. 281
(d) The speaker of the House of Representatives and the president 282
pro tempore of the Senate shall select the chairpersons of the council 283
from among the members of the council. Such chairpersons shall 284
schedule the first meeting of the council, which shall be held not later 285
than sixty days after the effective date of this section. 286 Raised Bill No. 260
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(e) The administrative staff of the joint standing committee of the 287
General Assembly having cognizance of matters relating to insurance 288
shall serve as administrative staff of the council. 289
(f) Not later than September 1, 2023, and annually thereafter, the 290
council shall submit a report to the board, in accordance with the 291
provisions of section 11-4a of the general statutes, on its 292
recommendations concerning prescription drug prices. The council 293
shall also provide recommendations to the board at any time the board 294
requests such recommendations. 295
Sec. 5. Subdivision (12) of section 1-79 of the 2022 supplement to the 296
general statutes is repealed and the following is substituted in lieu 297
thereof (Effective October 1, 2022): 298
(12) "Quasi-public agency" means Connecticut Innovations, 299
Incorporated, the Connecticut Health and Education Facilities 300
Authority, the Connecticut Higher Education Supplemental Loan 301
Authority, the Connecticut Student Loan Foundation, the Connecticut 302
Housing Finance Authority, the State Housing Authority, the Materials 303
Innovation and Recycling Authority, the Capital Region Development 304
Authority, the Connecticut Lottery Corporation, the Connecticut 305
Airport Authority, the Connecticut Health Insurance Exchange, the 306
Connecticut Green Bank, the Connecticut Retirement Security 307
Authority, the Connecticut Port Authority, the Connecticut Municipal 308
Redevelopment Authority, the State Education Resource Center, [and] 309
the Paid Family and Medical Leave Insurance Authority and the 310
Prescription Drug Cost Control Board. 311
Sec. 6. Section 1-120 of the general statutes is repealed and the 312
following is substituted in lieu thereof (Effective October 1, 2022): 313
As used in sections 1-120 to 1-123, inclusive: 314
(1) "Quasi-public agency" means Conn ecticut Innovations, 315
Incorporated, the Connecticut Health and Educational Facilities 316
Authority, the Connecticut Higher Education Supplemental Loan 317 Raised Bill No. 260
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Authority, the Connecticut Student Loan Foundation, the Connecticut 318
Housing Finance Authority, the Connecticut Housing Authority, the 319
Materials Innovation and Recycling Authority, the Capital Region 320
Development Authority, the Connecticut Lottery Corporation, the 321
Connecticut Airport Authority, the Connecticut Health Insurance 322
Exchange, the Connecticut Green Bank, the Connecticut Retirement 323
Security Authority, the Connecticut Port Authority, the Connecticut 324
Municipal Redevelopment Authority, the State Education Resource 325
Center, [and] the Paid Family and Medical Leave Insurance Authority 326
and the Prescription Drug Cost Control Board. 327
(2) "Procedure" means each statement, by a quasi-public agency, of 328
general applicability, without regard to its designation, that 329
implements, interprets or prescribes law or policy, or describes the 330
organization or procedure of any such agency. The term includes the 331
amendment or repeal of a prior regulation, but does not include, unless 332
otherwise provided by any provision of the general statutes, (A) 333
statements concerning only the internal management of any agency and 334
not affecting procedures available to the public, and (B) intra-agency 335
memoranda. 336
(3) "Proposed procedure" means a proposal by a quasi-public agency 337
under the provisions of section 1-121 for a new procedure or for a 338
change in, addition to or repeal of an existing procedure. 339
Sec. 7. Section 38a-8 of the general statutes is amended by adding 340
subsection (h) as follows (Effective October 1, 2022): 341
(NEW) (h) The commissioner shall have all the powers that are 342
reasonable and necessary to enforce the provisions of section 1 of this 343
act concerning assessment of fees on prescription drug manufacturers. 344
The commissioner may also set upper payment limits on prescription 345
drugs in the state after receiving recommendations on such limits from 346
the Prescription Drug Cost Control Board pursuant to section 3 of this 347
act. 348 Raised Bill No. 260
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This act shall take effect as follows and shall amend the following
sections:
Section 1 October 1, 2022 New section
Sec. 2 October 1, 2022 New section
Sec. 3 October 1, 2022 New section
Sec. 4 October 1, 2022 New section
Sec. 5 October 1, 2022 1-79(12)
Sec. 6 October 1, 2022 1-120
Sec. 7 October 1, 2022 38a-8
Statement of Purpose:
To establish a board with authority to monitor prescription drug costs
and recommend price caps on such drugs sold in the state.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]