Drug Price Transparency Act

I 116TH CONGRESS 1ST SESSION H. R. 2087 To amend title XVIII of the Social Security Act to require certain manufac- turers to report drug pricing information with respect to drugs under the Medicare program, and for other purposes. IN THE HOUSE OF REPRESENTATIVES APRIL 4, 2019 Mr. DOGGETT (for himself and Mr. BUCHANAN) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subse- quently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To amend title XVIII of the Social Security Act to require certain manufacturers to report drug pricing information with respect to drugs under the Medicare program, 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 ‘‘Drug Price Trans- 4 parency Act’’. 5 VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS 2 •HR 2087 IH SEC. 2. REQUIRING CERTAIN MANUFACTURERS TO REPORT 1 DRUG PRICING INFORMATION WITH RE- 2 SPECT TO DRUGS UNDER THE MEDICARE 3 PROGRAM. 4 (a) IN GENERAL.—Section 1847A of the Social Secu- 5 rity Act (42 U.S.C. 1395w–3a) is amended— 6 (1) in subsection (b)— 7 (A) in paragraph (2)(A), by inserting ‘‘or 8 subsection (f)(2), as applicable’’ before the pe- 9 riod at the end; 10 (B) in paragraph (3), in the matter pre- 11 ceding subparagraph (A), by inserting ‘‘or sub- 12 section (f)(2), as applicable,’’ before ‘‘deter- 13 mined by’’; and 14 (C) in paragraph (6)(A), in the matter 15 preceding clause (i), by inserting ‘‘or subsection 16 (f)(2), as applicable,’’ before ‘‘determined by’’; 17 and 18 (2) in subsection (f)— 19 (A) by striking ‘‘For requirements’’ and 20 inserting the following: 21 ‘‘(1) IN GENERAL.—For requirements’’; and 22 (B) by adding at the end the following new 23 paragraph: 24 ‘‘(2) MANUFACTURERS WITHOUT A REBATE 25 AGREEMENT UNDER TITLE XIX.— 26 VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS 3 •HR 2087 IH ‘‘(A) IN GENERAL.—In the case of a man- 1 ufacturer of a drug or biological described in 2 subparagraph (C), (E), or (G) of section 3 1842(o)(1) or in clause (ii) or (iii) of section 4 1881(b)(14)(B) that does not have a rebate 5 agreement in effect under section 1927, for cal- 6 endar quarters beginning on or after January 7 1, 2020, such manufacturer shall report to the 8 Secretary the information described in sub- 9 section (b)(3)(A)(iii) of such section 1927 with 10 respect to such drug or biological in a time and 11 manner specified by the Secretary. 12 ‘‘(B) AUDIT.—Information reported under 13 subparagraph (A) is subject to audit by the In- 14 spector General of the Department of Health 15 and Human Services. 16 ‘‘(C) VERIFICATION.—The Secretary may 17 survey wholesalers and manufacturers that di- 18 rectly distribute drugs described in subpara- 19 graph (A), when necessary, to verify manufac- 20 turer prices and manufacturer’s average sales 21 prices (including wholesale acquisition cost) if 22 required to make payment reported under sub- 23 paragraph (A). The Secretary may impose a 24 civil monetary penalty in an amount not to ex- 25 VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS 4 •HR 2087 IH ceed $100,000 on a wholesaler, manufacturer, 1 or direct seller, if the wholesaler, manufacturer, 2 or direct seller of such a drug refuses a request 3 for information about charges or prices by the 4 Secretary in connection with a survey under 5 this subparagraph or knowingly provides false 6 information. The provisions of section 1128A 7 (other than subsections (a) (with respect to 8 amounts of penalties or additional assessments) 9 and (b)) shall apply to a civil money penalty 10 under this subparagraph in the same manner as 11 such provisions apply to a penalty or proceeding 12 under section 1128A(a). 13 ‘‘(D) CONFIDENTIALITY.—Notwithstand- 14 ing any other provision of law, information dis- 15 closed by manufacturers or wholesalers under 16 this paragraph (other than the wholesale acqui- 17 sition cost for purposes of carrying out this sec- 18 tion) is confidential and shall not be disclosed 19 by the Secretary in a form which discloses the 20 identity of a specific manufacturer or whole- 21 saler or prices charged for drugs by such manu- 22 facturer or wholesaler, except— 23 ‘‘(i) as the Secretary determines to be 24 necessary to carry out this section (includ- 25 VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS 5 •HR 2087 IH ing the determination and implementation 1 of the payment amount), or to carry out 2 section 1847B; 3 ‘‘(ii) to permit the Comptroller Gen- 4 eral to review the information provided; 5 and 6 ‘‘(iii) to permit the Director of the 7 Congressional Budget Office to review the 8 information provided.’’. 9 (b) ENFORCEMENT.— 10 (1) IN GENERAL.—Section 1847A such Act (42 11 U.S.C. 1395w–3a) is further amended— 12 (A) in subsection (d)(4)— 13 (i) in subparagraph (A), by striking 14 ‘‘IN GENERAL’’ and inserting ‘‘MISREPRE- 15 SENTATION’’; 16 (ii) in subparagraph (B), by striking 17 ‘‘subparagraph (B)’’ and inserting ‘‘sub- 18 paragraph (A), (B), or (C)’’; 19 (iii) by redesignating subparagraph 20 (B) as subparagraph (D); and 21 (iv) by inserting after subparagraph 22 (A) the following new subparagraphs: 23 ‘‘(B) FAILURE TO PROVIDE TIMELY INFOR- 24 MATION.—If the Secretary determines that a 25 VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS 6 •HR 2087 IH manufacturer described in subsection (f)(2) has 1 failed to report on information described in sec- 2 tion 1927(b)(3)(A)(iii) with respect to a drug or 3 biological in accordance with such subsection, 4 the Secretary shall apply a civil money penalty 5 in an amount of $25,000 for each day the man- 6 ufacturer has failed to report such information 7 and such amount shall be paid to the Treasury. 8 ‘‘(C) FALSE INFORMATION.—Any manu- 9 facturer required to submit information under 10 subsection (f)(2) that knowingly provides false 11 information is subject to a civil money penalty 12 in an amount not to exceed $100,000 for each 13 item of false information. Such civil money pen- 14 alties are in addition to other penalties as may 15 be prescribed by law.’’; and 16 (B) in subsection (c)(6)(A), by striking the 17 period at the end and inserting ‘‘, except that, 18 for purposes of subsection (f)(2), the Secretary 19 may, if the Secretary determines appropriate, 20 exclude repackagers of a drug or biological from 21 such term.’’. 22 (2) CONFORMING EXISTING MANUFACTURER 23 REPORTING PENALTIES.—Section 1927(b)(3)(C)(i) 24 of such Act (42 U.S.C. 1396r–8(b)(3)(C)(i)) is 25 VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS 7 •HR 2087 IH amended by inserting ‘‘(or, for such failures occur- 1 ring on or after January 1, 2020, $25,000)’’ after 2 ‘‘$10,000’’. 3 (c) REPORT.—Not later than January 1, 2021, the 4 Inspector General of the Department of Health and 5 Human Services shall assess and submit to Congress a 6 report on the accuracy of average sales price information 7 submitted by manufacturers under section 1847A of the 8 Social Security Act (42 U.S.C. 1395w–3a). Such report 9 shall include any recommendations on how to improve the 10 accuracy of such information. 11 Æ VerDate Sep 11 2014 03:17 Apr 16, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H2087.IH H2087 kjohnson on DSK79L0C42 with BILLS