Bill Text: TX HB2536 | 2019-2020 | 86th Legislature | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to transparency related to drug costs.
Spectrum: Slight Partisan Bill (Democrat 4-2)
Status: (Passed) 2019-06-14 - Effective on 9/1/19 [HB2536 Detail]
Download: Texas-2019-HB2536-Introduced.html
Bill Title: Relating to transparency related to drug costs.
Spectrum: Slight Partisan Bill (Democrat 4-2)
Status: (Passed) 2019-06-14 - Effective on 9/1/19 [HB2536 Detail]
Download: Texas-2019-HB2536-Introduced.html
86R9601 PMO-F | ||
By: Oliverson | H.B. No. 2536 |
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relating to transparency related to drug costs. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Subtitle A, Title 6, Health and Safety Code, is | ||
amended by adding Chapter 441 to read as follows: | ||
CHAPTER 441. DRUG COST TRANSPARENCY | ||
SUBCHAPTER A. GENERAL PROVISIONS | ||
Sec. 441.0001. DEFINITIONS. In this chapter: | ||
(1) "Pharmaceutical drug manufacturer" means a person | ||
engaged in the business of producing, preparing, propagating, | ||
compounding, converting, processing, packaging, labeling, or | ||
distributing a drug. The term does not include a wholesale | ||
distributor or retailer of prescription drugs or a pharmacist | ||
licensed under Subtitle J, Title 3, Occupations Code. | ||
(2) "Prescription drug" and "drug" have the meanings | ||
assigned by Section 551.003, Occupations Code, except that the term | ||
"prescription drug" does not include a device. | ||
(3) "Wholesale acquisition cost" means, with respect | ||
to a drug, the pharmaceutical drug manufacturer's list price for | ||
the drug charged to wholesalers or direct purchasers in the United | ||
States, as reported in wholesale price guides or other publications | ||
of drug pricing data. The cost does not include any rebates, prompt | ||
pay or other discounts, or other reductions in price. | ||
Sec. 441.0002. DISCLOSURE OF DRUG PRICING INFORMATION. (a) | ||
Not later than the 15th day of each calendar year, a pharmaceutical | ||
drug manufacturer shall submit a report to the executive | ||
commissioner stating the current wholesale acquisition cost | ||
information for the United States Food and Drug | ||
Administration-approved drugs sold in or into this state by that | ||
manufacturer. | ||
(b) The executive commissioner shall develop an Internet | ||
website to provide to the general public drug price information | ||
submitted under Subsection (a). The Internet website shall be made | ||
available on the Health and Human Services Commission's Internet | ||
website with a dedicated link that is prominently displayed on the | ||
home page or by a separate easily identifiable Internet address. | ||
(c) Not later than the 30th day after the effective date of | ||
an increase of 50 percent or more in wholesale acquisition cost of a | ||
drug with a wholesale acquisition cost of at least $100 for a 30-day | ||
supply, a pharmaceutical drug manufacturer shall submit a report to | ||
the executive commissioner. The report must include the following | ||
information: | ||
(1) the name of the drug; | ||
(2) whether the drug is a brand name or generic; | ||
(3) the effective date of the change in wholesale | ||
acquisition cost; | ||
(4) aggregate, company-level research and development | ||
costs for the previous calendar year; | ||
(5) the name of each of the manufacturer's | ||
prescription drugs approved by the United States Food and Drug | ||
Administration in the previous five calendar years; and | ||
(6) the name of each of the manufacturer's | ||
prescription drugs that lost patent exclusivity in the United | ||
States in the previous five calendar years. | ||
(d) The quality and types of information and data that a | ||
pharmaceutical drug manufacturer submits to the executive | ||
commissioner under Subsection (c) must be consistent with the | ||
quality and types of information and data that the manufacturer | ||
includes in the manufacturer's annual consolidated report on | ||
Securities and Exchange Commission Form 10-K or any other public | ||
disclosure. | ||
(e) Not later than the 60th day after receipt of the report | ||
submitted under Subsection (c), the executive commissioner shall | ||
publish the report on the Health and Human Services Commission's | ||
Internet website described by Subsection (b). | ||
(f) A pharmaceutical drug manufacturer shall notify the | ||
executive commissioner in writing if the manufacturer introduces a | ||
new prescription drug to market with a wholesale acquisition cost | ||
that exceeds the threshold set for a specialty drug under the | ||
Medicare Part D program. The manufacturer shall provide the | ||
written notice not later than the third day after the date of the | ||
release of the drug in the commercial market. A manufacturer may | ||
make the notification pending approval by the United States Food | ||
and Drug Administration if commercial availability is expected not | ||
later than three calendar days following the approval. | ||
(g) The executive commissioner may adopt rules to implement | ||
this section. | ||
SECTION 2. Chapter 1369, Insurance Code, is amended by | ||
adding Subchapter K to read as follows: | ||
SUBCHAPTER K. PRESCRIPTION DRUG COST TRANSPARENCY | ||
Sec. 1369.501. DEFINITIONS. In this subchapter: | ||
(1) "Health benefit plan" means an individual, | ||
blanket, or group plan, policy, or contract for health care | ||
services issued or delivered by a health benefit plan issuer in this | ||
state. | ||
(2) "Health benefit plan issuer" means an insurance | ||
company, a health maintenance organization, or a hospital and | ||
medical service corporation. | ||
(3) "Pharmaceutical drug manufacturer" means a person | ||
engaged in the business of producing, preparing, propagating, | ||
compounding, converting, processing, packaging, labeling, or | ||
distributing a prescription drug. The term does not include a | ||
wholesale distributor or retailer of prescription drugs or a | ||
pharmacist licensed under Subtitle J, Title 3, Occupations Code. | ||
(4) "Pharmacy benefit manager" has the meaning | ||
assigned by Section 4151.151. | ||
(5) "Prescription drug" has the meaning assigned by | ||
Section 551.003, Occupations Code, except that the term | ||
"prescription drug" does not include a device. | ||
(6) "Rebate" means a discount or concession that | ||
affects the price of a prescription drug to a pharmacy benefit | ||
manager or health benefit plan issuer for a prescription drug | ||
manufactured by the pharmaceutical drug manufacturer. | ||
(7) "Specialty drug" means a prescription drug covered | ||
under Medicare Part D that exceeds the specialty tier cost | ||
threshold established by the Centers for Medicare and Medicaid | ||
Services. | ||
(8) "Utilization management" means a set of formal | ||
techniques designed to monitor the use of, or evaluate the medical | ||
necessity, appropriateness, efficacy, or efficiency of, health | ||
care services, procedures, or settings. | ||
Sec. 1369.502. PHARMACY BENEFIT MANAGER INFORMATION. (a) | ||
Not later than February 1 of each year, each pharmacy benefit | ||
manager shall file a report with the commissioner. The report must | ||
state for the immediately preceding calendar year: | ||
(1) the aggregated rebates, fees, price protection | ||
payments, and any other payments collected from pharmaceutical drug | ||
manufacturers; and | ||
(2) the aggregated dollar amount of rebates, fees, | ||
price protection payments, and any other payments collected from | ||
pharmaceutical drug manufacturers that were passed to: | ||
(A) health benefit plan issuers; or | ||
(B) enrollees at the point of sale of a | ||
prescription drug. | ||
(b) A report submitted by a pharmacy benefit manager may not | ||
disclose the identity of a specific health benefit plan or | ||
enrollee, the price charged for a specific prescription drug or | ||
class of prescription drugs, or the amount of any rebate or fee | ||
provided for a specific prescription drug or class of prescription | ||
drugs. | ||
(c) Not later than the 60th day after receipt, the | ||
commissioner shall publish the report in an appropriate location on | ||
the department's Internet website. | ||
Sec. 1369.503. HEALTH BENEFIT PLAN ISSUER INFORMATION. (a) | ||
Not later than February 1 of each year, each health benefit plan | ||
issuer shall submit to the commissioner a report that states for the | ||
immediately preceding calendar year: | ||
(1) the names of the 25 most frequently prescribed | ||
prescription drugs across all plans; | ||
(2) the percent increase in annual net spending for | ||
prescription drugs across all plans; | ||
(3) the percent increase in premiums that were | ||
attributable to prescription drugs across all plans; | ||
(4) the percentage of specialty drugs with utilization | ||
management requirements across all plans; and | ||
(5) the premium reductions that were attributable to | ||
specialty drug utilization management. | ||
(b) A report submitted by a health benefit plan issuer may | ||
not disclose the identity of a specific health benefit plan or the | ||
price charged for a specific prescription drug or class of | ||
prescription drugs. | ||
(c) Not later than the 60th day after receipt, the | ||
commissioner shall publish the report in an appropriate location on | ||
the department's Internet website. | ||
Sec. 1369.504. RULES. The commissioner may adopt rules to | ||
implement this subchapter. | ||
SECTION 3. Notwithstanding Chapter 441, Health and Safety | ||
Code, as added by this Act, and Subchapter K, Chapter 1369, | ||
Insurance Code, as added by this Act, a pharmaceutical drug | ||
manufacturer, pharmacy benefit manager, or health benefit plan | ||
issuer is not required to submit a summary report as required by | ||
Chapter 441, Health and Safety Code, as added by this Act, or | ||
Subchapter K, Chapter 1369, Insurance Code, as added by this Act, as | ||
applicable, before January 1, 2020. | ||
SECTION 4. This Act takes effect September 1, 2019. |