Signed by Governor Greg Abbott

Vote Smart's Synopsis:

Vote to pass with amendment a bill that establishes reporting requirements for pharmaceutical drug manufacturers, health plans, and pharmacy benefit managers.

Highlights:

• Defines “pharmaceutical drug manufacturer” as a person engaged in the business of producing, preparing, propagating, compounding, converting, processing, packaging, labeling, or distributing a drug, not including a wholesale distributor or retailer of prescription drugs or a pharmacist (Sec. 1).

• Defines “wholesale acquisition cost,” with respect to a drug, as the pharmaceutical drug manufacturer’s list price for the drug charge to wholesalers or direct purchasers in the US, as reported in wholesale price guides or other publications of drug pricing data (Sec. 1).

• Requires a pharmaceutical drug manufacturer, no later than the 15th day of each calendar year, to submit a report to the executive commissioner listing the current wholesale acquisition cost information for the Food and Drug Administration-approved drugs sold in or into Texas by that manufacturer (Sec. 1).

• Requires the executive commissioner to develop a website for providing drug price information to the general public to be made available on the Health and Human Services Commission’s website (Sec. 1).

• Requires a pharmaceutical drug manufacturer, no later than the 30th day following the effective date of an increase of 40 percent or more over the preceding three calendar years or 15 percent or more in the preceding calendar year in the wholesale acquisition cost of a drug with a wholesale acquisition cost of at least $100 for a 30-day supply before the effective date of an increase, to submit a report to the executive commissioner that includes (Sec. 1):

• The name of the drug;

• Whether the drug is a brand name or generic;

• The effective date of the change in wholesale acquisition cost;

• Aggregate, company-level research and development costs for the most recent year for which final audit data is available;

• The name of each of the manufacturer’s prescription drugs approved by the FDA in the previous three calendar years;

• The name of each of the manufacturer’s prescription drugs that lost patent exclusivity in the US in the previous three calendar years; and

• A statement concerning the factor or factors that cause the increase in the wholesale acquisition cost and an explanation of the role of each factor’s impact on the cost.

• Requires every pharmacy benefit manager, no later than February 1 of each year, to file a report with the commissioner that lists for the immediately preceding calendar year (Sec. 2):

• The aggregated rebates, fees, price protection payments, and any other payments collected from pharmaceutical drug manufacturers; and

• The aggregated dollar amount of rebates, fees, price protection payments, and any other payments collected from pharmaceutical drug manufacturers that were

• Passed to health benefit plan issuers or enrollees at the point of sale of a prescription drug; or

• Retained as revenue by the pharmacy benefit manager.

• Requires the commissioner, no later than May 1 of each year, to publish the aggregated data from all reports discussed in the preceding highlight for that year in an appropriate location on the department’s website (Sec. 2).

• Requires each health benefit plan issuer, no later than February 1 of each year, to submit to the commissioner a report that lists for the immediately preceding calendar year (Sec. 2):

• The names of the 25 most frequently prescribed prescription drugs;

• The percent increase in annual net spending for prescription drugs;

• The percent increase in premiums attributable to prescription drugs;

• The percentage of specialty drugs with utilization management requirements; and

• The premium reductions attributable to specialty drug utilization management.

• Requires the commissioner, no later than May 1 of each year, to publish the aggregated data from all reports discussed in the preceding highlight for that year in an appropriate location on the department’s website (Sec. 2).

Full Bill Text