Bill to Expand Transparency in Prescription Drug Pricing Advances
Trenton – In an effort to make prescription drugs more affordable, the Senate Budget and Appropriations Committee today advanced legislation sponsored by Senators Troy Singleton, Joseph Vitale, and Nellie Pou which would establish certain data reporting requirements for prescription drug supply chains.
"New Jersey's affordability crisis affects all of us – most especially those who rely on prescription drugs to live," said Senator Singleton (D-Burlington). "Now more than ever, we must work to make life-saving medicine more accessible and affordable. Each and every day, someone skips a dose or cuts a pill in half just to save money. In the richest nation in the world, and one of the wealthiest states in America, this is unacceptable and simply unconscionable."
The bill, S-1615, would establish data reporting requirements for pharmacy benefits managers, pharmacy services administrative organizations, wholesale drug distributors, insurance issuers, and manufacturers. The bill would direct the Division of Consumer Affairs (DCA) to issue an annual report, using data collected, on emerging trends in prescription drug pricing at each stage of the supply chain.
“For far too long, consumers have been excluded from the drug pricing process. This legislation would bring to light the inner workings and beneficiaries within the pharmaceutical industry,” said Senator Vitale (D-Middlesex). “Inflated prescription drug prices without reasoning or accountability is unfair and irresponsible; this bill would ensure that pharmaceutical companies and manufacturers are open and honest with the consumers they serve.”
Under the bill, annually, the reporting entities would be required to register with the division and report on measures such as the volume, sales, revenue and year-over-year change in prescription drug transactions. Once the DCA publishes its annual report on prescription drug pricing trends, it would be required to hold a public hearing on the findings.
The measure would also mandate manufacturers to notify the division if it is increasing the price of a prescription drug by more than 10 percent per unit for any brand-name drug or any generic drug priced at more than $100 per unit.
“Currently, we are facing a severe affordability crisis throughout the nation, and the stunning increase in prescription drug prices continues to play a huge role. Consumers are kept in the dark about these price increases, which is neglectful of the impact these increases have on residents,” said Senator Pou (D-Bergen/Passaic). “Research derived from this legislation would keep consumers prepared and informed while holding pharmaceutical companies and manufacturers accountable.”
Additionally, the bill would establish the Prescription Drug Affordability Council to formulate legislative and regulatory policy recommendations to protect New Jersey residents from the high costs of prescription drug products. Each member would be required to have expertise in health care economics, health care policy, or clinical medicine.
The bill would direct the council to review the reports issued and data collected by the division and submit annual recommendations for legislative, regulatory or other action to the Governor and the Legislature.
The bill was released from committee by a vote of 7-3.