9. The average patient copay or other cost sharing for the drug.

If the board determines that a prescription drug will lead to an affordability challenge, the bill directs the board to establish an upper payment limit for that drug that applies to all purchases and payor reimbursements of the drug dispensed or administered to individuals in Wisconsin. In establishing the upper payment limit, the board must consider the cost of administering the drug, the cost of delivering it to consumers, and other relevant administrative costs. For certain drugs, the board must solicit information from the manufacturer regarding the price increase and, if the board determines that the price increase is not a result of the need for increased manufacturing capacity or other effort to improve patient access during a public health emergency, the board must establish an upper payment limit equal to the drug's cost prior to the price increase.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

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

SB540,1 Section 1 . 15.07 (3) (bm) 7. of the statutes is created to read:

SB540,3,3 15.07 (3) (bm) 7. The prescription drug affordability review board shall meet at least 4 times each year.

SB540,2 Section 2 . 15.735 of the statutes is created to read:

SB540,3,7 15.735 Same; attached board. (1) There is created a prescription drug affordability review board attached to the office of the commissioner of insurance under s. 15.03. The board shall consist of the following members:

SB540,3,8 (a) The commissioner of insurance or his or her designee.

SB540,3,12 (b) Two members appointed for 4-year terms who represent the pharmaceutical drug industry, including pharmaceutical drug manufacturers and wholesalers. At least one of the members appointed under this paragraph shall be a licensed pharmacist.

SB540,3,14 (c) Two members appointed for 4-year terms who represent the health insurance industry, including insurers and pharmacy benefit managers.

SB540,3,17 (d) Two members appointed for 4-year terms who represent the health care industry, including hospitals, physicians, pharmacies, and pharmacists. At least one of the members appointed under this paragraph shall be a licensed practitioner.

SB540,3,19 (e) Two members appointed for 4-year terms who represent the interests of the public.

SB540,4,3 (2) A member appointed under sub. (1) may not be an employee of, a board member of, or a consultant to a drug manufacturer or trade association for drug manufacturers.

SB540,4,8 (3) Any conflict of interest, including any financial or personal association, that has the potential to bias or has the appearance of biasing an individual's decision in matters related to the board or the conduct of the board's activities shall be considered and disclosed when appointing that individual to the board under sub. (1).

SB540,3 Section 3 . Subchapter VI (title) of chapter 601 [precedes 601.78] of the statutes is created to read:

SB540,4,11 CHAPTER 601

SB540,4,13 SUBCHAPTER VI Prescription drug

SB540,4,14 affordability review board

SB540,4,15 601.78 Definitions. In this subchapter:

SB540,4,17 (1) “Biologic” means a drug that is produced or distributed in accordance with a biologics license application approved under 21 CFR 601.20.

SB540,4,19 (2) “Biosimilar” means a drug that is produced or distributed in accordance with a biologics license application approved under 42 USC 262 (k) (3).

SB540,4,21 (3) “Board” means the prescription drug affordability review board established under s. 15.735 (1).

SB540,4,24 (4) “Brand name drug” means a drug that is produced or distributed in accordance with an original new drug application approved under 21 USC 355 (c), other than an authorized generic drug, as defined in 42 CFR 447.502.

SB540,5,2 (5) “Drug product” means a brand name drug, a generic drug, a biologic, a biosimilar, or an over-the-counter drug.

SB540,5,6 (6) “Financial benefit” includes an honoraria, fee, stock, the value of the stock holdings of a member of the board or any immediate family member, as defined in s. 97.605 (4) (a) 2., and any direct financial benefit deriving from the finding of a review conducted under s. 601.79.

SB540,5,7 (7) “Generic drug” means any of the following:

SB540,5,9 (a) A retail drug that is marketed or distributed in accordance with an abbreviated new drug application approved under 21 USC 355 (j).