Revision: Nov. 3, 2017, 12:17 p.m.
HB 1418-FN - AS INTRODUCED
2018 SESSION
18-2010
01/10
HOUSE BILL 1418-FN
AN ACT relative to transparency and cost control of pharmaceutical drug prices.
SPONSORS: Rep. Butler, Carr. 7; Rep. Rosenwald, Hills. 30; Rep. Kurk, Hills. 2
COMMITTEE: Commerce and Consumer Affairs
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ANALYSIS
This bill requires the commissioner of the department of health and human services, in consultation with the insurance commissioner, to develop a list of certain critical prescription drugs for purposes of cost control and transparency. Under this bill, the commissioner shall make an annual report on prescription drugs and their role in overall health care spending in the New Hampshire.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
18-2010
01/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Eighteen
AN ACT relative to transparency and cost control of pharmaceutical drug prices.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Paragraph; Department of Health and Human Services; Commissioner's Duties. Amend RSA 126-A:5 by inserting after paragraph XXX the following new paragraph:
XXXI.(a) The commissioner, in consultation with the insurance commissioner, shall develop a list of critical prescription drugs for which there is a substantial public interest in understanding the development of its pricing. In developing the list, the commissioner shall consider the following factors:
(1) The cost of the drug to public health care programs, including Medicaid and the state employee health insurance plan;
(2) The current cost of the drug in New Hampshire;
(3) The extent of utilization of the drug within New Hampshire; and
(4) The potential impact of the cost of the drug on commercial health insurance.
(b) For each prescription drug that the commissioner places on the critical prescription drug list pursuant to subparagraph (a), the commissioner shall require the manufacturers of such prescription drug to report the following information to the commissioner:
(1) The total cost of production, and approximate cost of production per dose;
(2) Research and development costs of the drug, including:
(A) Research and development costs that are paid with public funds;
(B) After-tax research and development costs paid by the manufacturer; and
(C) Research and development costs paid by third parties.
(3) Marketing and advertising costs for the drug, apportioned by marketing activities that are directed to consumers, marketing activities that are directed to prescribers, and the total cost of all marketing and advertising that is directed primarily to New Hampshire consumers and prescribers;
(4) The prices for the drug that are charged to purchasers outside the United States, by country, for a representative set of countries determined by the commissioner;
(5) Prices charged to typical New Hampshire purchasers, including, but not limited to, pharmacies, pharmacy chains, pharmacy wholesalers, or other direct purchasers;
(6) True net typical prices charged to prescription drug benefit managers for distribution in New Hampshire, net of any rebates or other payments from the manufacturer to the pharmacy benefit manager and the pharmacy benefit manager to the manufacturer.
(c) The commissioner shall adopt rules, pursuant to RSA 541-A, relative to further defining and enforcing the provisions of this paragraph, which may include monetary penalties for failure to comply with the requirements of this paragraph.
(d) Information reported pursuant to subparagraph (b) shall not be considered a public record under RSA 91-A. Any public reporting of information submitted pursuant to paragraph (b) shall not contain any personally identifiable information.
(e) The commissioner shall make an annual report commencing on November 1, 2018 on prescription drug prices and their role in overall health care spending in New Hampshire based on the data submitted pursuant to subparagraph (b) which shall be in compliance with subparagraph (d) together with any recommendations for legislation to the president of the senate, the speaker of the house of representatives, the governor, and the house and senate committees having jurisdiction over health and human services issues. The report shall also be posted on the department of health and human services' Internet website.
2 Effective Date. This act shall take effect 60 days after its passage.
18-2010
10/27/17
HB 1418-FN- FISCAL NOTE
AS INTRODUCED
AN ACT relative to transparency and cost control of pharmaceutical drug prices.
FISCAL IMPACT: [ X ] State [ ] County [ ] Local [ ] None
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| Estimated Increase / (Decrease) | |||
STATE: | FY 2019 | FY 2020 | FY 2021 | FY 2022 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable | Indeterminable | Indeterminable | Indeterinable |
Funding Source: | [ X ] General [ ] Education [ ] Highway [ ] Other | |||
METHODOLOGY:
This bill requires the Commissioner of the Department of Health and Human Services (DHHS), in consultation with the Commissioner of the Insurance Department, to develop a list of critical prescription drugs for which there is a substantial public interest in understanding the development of their pricing. For each prescription drug that the commissioner places on the critical prescription drug list, the manufacturers of such presciption drug shall be required to report information relating to costs of production, research and development, marketing and advertising, and prices charged. Such infomation shall not be considered a public record under RSA 91-A. The Commissioner of the Department of Health and Human Services shall promulgate rules to effect the purposes specified and such rules may include monetary penalties for failure to comply with the provisions of the legislation and adopted rules. DHHS shall make an annual report on prescription drug prices and their role in overall health care spending in New Hampshire based on data submitted.
The DHHS states that the analysis required by the proposed legislation is significant and likely cannot be completed with existing departmental resources. Types and costs of resources necessary are dependent upon the size of the critical prescripton drug list, the quality of infomation recieved from manufacturers, and the content of the annual report, all of which are indeterminable at this time.
The Department of Insurance indicates there will be no impact on premium tax revenue and assumes that these activities can be absorbed within the department's current operating budget.
The Department of Administrative Services (DAS) states that the DHHS will work with the DAS Risk Management Unit (RMU) staff to determine which drugs it considers critical to understanding the development of drug pricing. The DHHS annual report on prescription drugs cost to public health programs, including Medicaid and the state employee health benefit plan (HBP) will require RMU staff time to work with DHHS, the Department of Insurance and the HBP Pharmacy Benefit Manager (PBM) to identify drugs with high cost and/or utilization. in the short term this legislation may cause a drug manufacturer and/or PBM to be reluctant to do business with the state or it may cause an increase in negotiated HBP drug prices. In the long term pharmacy price transparency may position the state to achieve deeper discounts when negotiating drug pricing. The overall impact on HBP drug costs are indeterminable and employee staff time may be impacted, thereby affecting the availablity for other departmental duties.
The Office of Professional Licensure and Certification and the Board of Pharmacy indicate there is no fiscal impact.
AGENCIES CONTACTED:
Department of Health and Human Services, Insurance Department, Department of Administrative Services, Office of Professional Licensure, and Board of Pharmacy