Texas 2019 - 86th Regular

Texas House Bill HB697 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	86R1825 KKR-D
2	2	By: Blanco H.B. No. 697
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to required prescription drug cost and rebate reporting;
8	8	authorizing a civil penalty.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 430.001, Health and Safety Code, is
11	11	amended by amending Subdivision (1) and adding Subdivision (1-a) to
12	12	read as follows:
13	13	(1) "Commission" means the Health and Human Services
14	14	Commission.
15	15	(1-a) "Commissioner" means the commissioner of state
16	16	health services.
17	17	SECTION 2. Subchapter E, Chapter 431, Health and Safety
18	18	Code, is amended by adding Sections 431.1165 and 431.1166 to read as
19	19	follows:
20	20	Sec. 431.1165. PRESCRIPTION DRUG MANUFACTURER COST
21	21	REPORTING; CIVIL PENALTY. (a) In this section:
22	22	(1) "Manufacturer" means a person licensed or approved
23	23	by the United States Food and Drug Administration to engage in the
24	24	manufacture of drugs or devices, consistent with the federal
25	25	agency's definition of "manufacturer" under the agency's
26	26	regulations and guidances implementing the Prescription Drug
27	27	Marketing Act of 1987 (Pub. L. No. 100-293). The term does not
28	28	include a pharmacist engaged in compounding that is within the
29	29	practice of pharmacy and is in accordance with a prescription drug
30	30	order or initiative from a practitioner for a patient or
31	31	prepackaging that complies with Section 562.154, Occupations Code.
32	32	(2) "Prescription drug" has the meaning assigned by 21
33	33	C.F.R. Section 203.3.
34	34	(b) Not later than February 1 of each year, the commission
35	35	shall:
36	36	(1) identify the prescription drugs and the wholesale
37	37	price for each drug the commission determines is essential to
38	38	treating diabetes in this state, including insulin and biguanides;
39	39	(2) identify the prescription drugs described by
40	40	Subdivision (1) for which the wholesale price has increased in an
41	41	amount equal to or greater than:
42	42	(A) the percentage of price increase in the
43	43	medical care component of the consumer price index as published by
44	44	the Bureau of Labor Statistics of the United States Department of
45	45	Labor during the preceding calendar year; or
46	46	(B) two times the percentage of price increase in
47	47	the medical care component of the consumer price index as published
48	48	by the Bureau of Labor Statistics of the United States Department of
49	49	Labor during the preceding two calendar years; and
50	50	(3) post the information compiled under Subdivisions
51	51	(1) and (2) on the commission's Internet website.
52	52	(c) Not later than August 1 of each year, a manufacturer
53	53	shall submit to the commission, in the manner and form prescribed by
54	54	the executive commissioner, a report for each prescription drug
55	55	identified under Subsection (b) that is manufactured by the
56	56	manufacturer and available for sale in this state.
57	57	(d) For each prescription drug identified under Subsection
58	58	(b)(1) and included in the report under Subsection (c), the
59	59	manufacturer, for the preceding calendar year, shall provide:
60	60	(1) the cost incurred by the manufacturer in producing
61	61	the drug;
62	62	(2) the wholesale price of the drug;
63	63	(3) a history of any increases in the wholesale price
64	64	of the drug for the preceding five years, including the amount of
65	65	each increase expressed as a percentage of the total wholesale
66	66	price of the drug, the month and year the price increase took
67	67	effect, and any explanation for the price increase;
68	68	(4) the profit derived from the sale of the drug,
69	69	expressed as an amount and as a percentage of the manufacturer's
70	70	total profit from all prescription drugs sold by the manufacturer;
71	71	(5) the administrative, marketing, and advertising
72	72	costs of promoting the drug;
73	73	(6) the cost to the manufacturer of coupons provided
74	74	directly to consumers to assist consumers in paying copayments and
75	75	the value of the coupons redeemed;
76	76	(7) the cost to the manufacturer of programs designed
77	77	to assist consumers in paying copayments for the drug;
78	78	(8) the amount of financial assistance provided for
79	79	the drug by the manufacturer through patient prescription
80	80	assistance programs; and
81	81	(9) the aggregate amount of rebates paid to pharmacy
82	82	benefit managers, as defined by Section 4151.151, Insurance Code,
83	83	for sales of the drug in this state.
84	84	(e) For each prescription drug identified under Subsection
85	85	(b)(2) and included in the report under Subsection (c), the
86	86	manufacturer, for the preceding calendar year, shall provide
87	87	information that justifies the increase in the wholesale price,
88	88	including:
89	89	(1) the factors contributing to the wholesale price
90	90	increase;
91	91	(2) the percentage of the total wholesale price
92	92	increase attributable to each factor; and
93	93	(3) an explanation of the role of each factor in
94	94	contributing to the wholesale price increase.
95	95	(f) Not later than December 1 of each year, the commission
96	96	shall prepare and post on the commission's Internet website a
97	97	report outlining the information provided by a manufacturer under
98	98	this section. The report may not include information likely to
99	99	compromise the financial, competitive, or proprietary nature of the
100	100	information.
101	101	(g) Information provided by a manufacturer to the
102	102	commission under this section is confidential and is not subject to
103	103	disclosure under Chapter 552, Government Code.
104	104	(h) A manufacturer that does not submit the report required
105	105	by Subsection (c) is liable to the state for a civil penalty of not
106	106	more than $5,000 for each violation. The commission may waive the
107	107	civil penalty if a manufacturer provides good cause for the
108	108	manufacturer's failure to submit the report. Each failure to
109	109	provide information to the commission is a separate violation and
110	110	each day of continuing violation constitutes a separate violation.
111	111	The attorney general at the request of the commission may bring suit
112	112	to provide for injunctive relief or to recover a civil penalty, or
113	113	both. The attorney general may recover court costs and reasonable
114	114	attorney's fees.
115	115	Sec. 431.1166. PHARMACY BENEFIT MANAGER PRESCRIPTION DRUG
116	116	REBATE REPORTING. (a) In this section:
117	117	(1) "Manufacturer" means a person licensed or approved
118	118	by the United States Food and Drug Administration to engage in the
119	119	manufacture of drugs or devices, consistent with the federal
120	120	agency's definition of "manufacturer" under the agency's
121	121	regulations and guidances implementing the Prescription Drug
122	122	Marketing Act of 1987 (Pub. L. No. 100-293). The term does not
123	123	include a pharmacist engaged in compounding that is within the
124	124	practice of pharmacy and is in accordance with a prescription drug
125	125	order or initiative from a practitioner for a patient or
126	126	prepackaging that complies with Section 562.154, Occupations Code.
127	127	(2) "Pharmacy benefit manager" has the meaning
128	128	assigned by Section 4151.151, Insurance Code.
129	129	(3) "Prescription drug" has the meaning assigned by 21
130	130	C.F.R. Section 203.3.
131	131	(b) Not later than August 1 of each year, a pharmacy benefit
132	132	manager shall submit a report to the commission, in the manner and
133	133	form prescribed by the executive commissioner, regarding rebates
134	134	for each prescription drug identified under Section 431.1165(b)(1)
135	135	that is available for sale in this state. The report must include:
136	136	(1) the total amount of rebates the pharmacy benefit
137	137	manager negotiated with all manufacturers during the preceding
138	138	calendar year;
139	139	(2) the amount of the rebates described in Subdivision
140	140	(1) that were retained by the pharmacy benefit manager; and
141	141	(3) the amount of any rebates described in Subdivision
142	142	(1) that were negotiated for use by persons who receive
143	143	prescription drug benefits or assistance under Medicare or a state,
144	144	local, or federal public program.
145	145	(c) This section does not apply to prescription drug
146	146	benefits provided under a health care benefit plan established
147	147	under the Employee Retirement Income Security Act of 1974 (29
148	148	U.S.C. Section 1001 et seq.).
149	149	(d) Not later than December 1 of each year, the commission
150	150	shall prepare and post on the commission's Internet website a
151	151	report outlining the information provided by a pharmacy benefit
152	152	manager under this section. The report may not include information
153	153	that is likely to compromise the financial, competitive, or
154	154	proprietary nature of the information.
155	155	(e) Information provided by a pharmacy benefit manager to
156	156	the commission under this section is confidential and is not
157	157	subject to disclosure under Chapter 552, Government Code.
158	158	SECTION 3. As soon as practicable after the effective date
159	159	of this Act, the executive commissioner of the Health and Human
160	160	Services Commission shall adopt rules necessary to implement
161	161	Sections 431.1165 and 431.1166, Health and Safety Code, as added by
162	162	this Act.
163	163	SECTION 4. This Act takes effect September 1, 2019.