LRB-1471/1

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2019 - 2020 LEGISLATURE

2019 Assembly BILL 62

March 7, 2019 - Introduced by Representatives Myers, Anderson, Subeck, Sinicki, Vruwink, Zamarripa, Fields, Brostoff, Spreitzer, Shankland and Hebl, cosponsored by Senators L. Taylor and Carpenter. Referred to Committee on Insurance.

AB62,1,2 An Act to create 632.863, 632.864 and 632.865 (2) (c) of the statutes; relating to: manufacturer and insurer disclosure of prescription drug costs.

Analysis by the Legislative Reference Bureau

This bill imposes disclosure requirements related to prescription drug costs on drug manufacturers and health insurers.

First, the bill requires that a manufacturer of a prescription drug whose wholesale acquisition cost exceeds $40 notify certain purchasers of the drug, including the state, health insurers, and pharmacy benefit managers doing business in Wisconsin, when the cost for a course of therapy increases by more than 16 percent. The notice must be provided at least 60 days prior to the increase to the purchasers who have registered with the Office of the Commissioner of Insurance to receive notification. In addition to notifying the purchasers, the manufacturer must provide OCI with specified information about the increase, including the financial and nonfinancial factors used to make the decision to increase the drug's cost. Under the bill, a drug manufacturer must also notify OCI if the manufacturer releases a new drug whose wholesale acquisition cost exceeds the specialty drug tier threshold under the Medicare Part D program, which is currently $670 for a one-month supply. The bill directs OCI to publish the information it receives from manufacturers about cost increases and high-cost new drugs on its website. A manufacturer who fails to report information to OCI may be liable for a penalty of $1,000 for each day of the failure.

Second, the bill requires that an insurer issuing health insurance coverage in this state annually file a report with OCI that identifies which of the plan's covered drugs have the highest prescription rates and costs and, for large group plans, provides information about the relationship between prescription drug costs and premium rates. The bill directs OCI to use this information to annually compile a report that analyzes the overall impact in this state of drug costs on health care premiums. The report must be distributed to the legislature and published on OCI's website.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB62,1 Section 1. 632.863 of the statutes is created to read:

AB62,2,3 632.863 Prescription drug manufacturer notifications. (1) Definitions. In this section:

AB62,2,7 (a) “Course of therapy” means the recommended daily dosage units of a prescription drug pursuant to its prescribing label as approved by the federal food and drug administration for 30 days or for a normal course of treatment that is less than 30 days.

AB62,2,9 (b) “Manufacturer” means a manufacturer of a prescription drug that is purchased or reimbursed by any of the following:

AB62,2,11 1. A state or local government purchaser in Wisconsin or an entity acting on behalf of the state or local government.