State-Based, Market-Oriented, Prescription Drug Negotiations Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 2038 To allow State-based, market-oriented, prescription drug negotiations to lower pharmaceutical drug prices, to encourage competition, to increase con- sumer choice and access, and for other purposes. IN THE HOUSE OF REPRESENTATIVES APRIL 2, 2019 Mr. MEADOWS introduced the following bill; which was referred to the Committee on the Judiciary A BILL To allow State-based, market-oriented, prescription drug ne- gotiations to lower pharmaceutical drug prices, to encour- age competition, to increase consumer choice and access, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘State-Based, Market- 4 Oriented, Prescription Drug Negotiations Act of 2019’’. 5 VerDate Sep 11 2014 02:40 Apr 13, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2038.IH H2038 kjohnson on DSK79L0C42 with BILLS 2 •HR 2038 IH SEC. 2. ANTITRUST EXEMPTION FOR PRIVATE HEALTH IN- 1 SURER ISSUERS TO NEGOTIATE WHOLESALE 2 ACQUISITION PRICES OF PRESCRIPTION 3 DRUGS PURCHASED FROM DRUG MANUFAC- 4 TURERS. 5 It shall not be a violation of the antitrust laws for 6 one or more private health insurer issuers or their des- 7 ignated agents to jointly negotiate wholesale acquisition 8 prices of a prescription drug with a manufacturer of a pre- 9 scription drug with regards to the reimbursement policies 10 of the insurers of the manufacturer’s drugs so long as no 11 one single wholesale acquisition price is jointly determined 12 between the insurance issuers or their designated agents. 13 SEC. 3. DEFINITIONS. 14 For purposes of this Act: 15 (1) ANTITRUST LAWS.—The term ‘‘antitrust 16 laws’’ has the meaning given it in subsection (a) of 17 the 1st section of the Clayton Act (15 U.S.C. 12(a)), 18 except that such term includes section 5 of the Fed- 19 eral Trade Commission Act (15 U.S.C. 45) to the 20 extent such section 5 applies to unfair methods of 21 competition. 22 (2) HEALTH INSURANCE ISSUER.—The term 23 ‘‘health insurance issuer’’ means an insurance com- 24 pany, insurance service, or insurance organization 25 (including a health maintenance organization, as de- 26 VerDate Sep 11 2014 02:40 Apr 13, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2038.IH H2038 kjohnson on DSK79L0C42 with BILLS 3 •HR 2038 IH fined in paragraph (3)) which is licensed to engage 1 in the business of insurance in a State and which is 2 subject to State law which regulates insurance (with- 3 in the meaning of section 514(b)(2) of the Employee 4 Retirement Income Security Act of 1974 (29 U.S.C. 5 1144(b)(2))). Such term does not include a group 6 health plan. 7 (3) HEALTH MAINTENANCE ORGANIZATION.— 8 The term ‘‘health maintenance organization’’ 9 means— 10 (A) a federally qualified health mainte- 11 nance organization (as defined in section 12 300e(a) of title 42 of the Code of Federal Reg- 13 ulations), 14 (B) an organization recognized under State 15 law as a health maintenance organization, or 16 (C) a similar organization regulated under 17 State law for solvency in the same manner and 18 to the same extent as such a health mainte- 19 nance organization. 20 (4) MANUFACTURER.—The term ‘‘manufac- 21 turer’’ means anyone who is engaged in manufac- 22 turing, preparing, propagating, compounding, proc- 23 essing, packaging, repackaging, or labeling of a pre- 24 scription drug. 25 VerDate Sep 11 2014 02:40 Apr 13, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2038.IH H2038 kjohnson on DSK79L0C42 with BILLS 4 •HR 2038 IH (5) PRESCRIPTION DRUG.—The term ‘‘prescrip- 1 tion drug’’ means any human drug required by Fed- 2 eral law or regulation to be dispensed only by a pre- 3 scription, including finished dosage forms and active 4 ingredients subject to section 503(b) of the Federal 5 Food, Drug, and Cosmetic Act (21 U.S.C. 353(b)). 6 SEC. 4. EFFECTIVE DATE. 7 This Act shall take effect on the date of the enact- 8 ment of this Act but shall not apply with respect to con- 9 duct that occurs before such date. 10 Æ VerDate Sep 11 2014 02:40 Apr 13, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H2038.IH H2038 kjohnson on DSK79L0C42 with BILLS