To amend title XVIII of the Social Security Act to require PDP sponsors of a prescription drug plan under part D of the Medicare program that use a formulary to include certain generic drugs and biosimilar biological products on such formulary, and for other purposes.

I 116TH CONGRESS 1ST SESSION H. R. 4913 To amend title XVIII of the Social Security Act to require PDP sponsors of a prescription drug plan under part D of the Medicare program that use a formulary to include certain generic drugs and biosimilar biological products on such formulary, and for other purposes. IN THE HOUSE OF REPRESENTATIVES OCTOBER 30, 2019 Mr. MCKINLEY (for himself and Ms. KUSTER of New Hampshire) 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 subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the com- mittee concerned A BILL To amend title XVIII of the Social Security Act to require PDP sponsors of a prescription drug plan under part D of the Medicare program that use a formulary to include certain generic drugs and biosimilar biological products on such formulary, 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 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 2 •HR 4913 IH SECTION 1. REQUIREMENTS FOR PDP SPONSORS OF PRE- 1 SCRIPTION DRUG PLANS UNDER PART D OF 2 THE MEDICARE PROGRAM THAT USE 3 FORMULARIES. 4 (a) IN GENERAL.—Section 1860D–4(b)(3) of the So- 5 cial Security Act (42 U.S.C. 1395w–104(b)(3)) is amend- 6 ed by adding at the end the following new subparagraphs: 7 ‘‘(I) REQUIRED INCLUSION OF CERTAIN 8 GENERIC DRUGS AND BIOSIMILAR BIOLOGICAL 9 PRODUCTS.— 10 ‘‘(i) IN GENERAL.—With respect to a 11 plan year beginning on or after January 1, 12 2021, the formulary shall include— 13 ‘‘(I) each covered generic drug 14 for which the wholesale acquisition 15 cost is less than the wholesale acquisi- 16 tion cost of the reference drug of such 17 covered generic drug; and 18 ‘‘(II) each covered biosimilar bio- 19 logical product for which the whole- 20 sale acquisition cost is less than the 21 wholesale acquisition cost of the ref- 22 erence biological product of such cov- 23 ered biosimilar biological product. 24 ‘‘(ii) PROHIBITION ON CERTAIN LIM- 25 ITS ON ACCESS.—The PDP sponsor offer- 26 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 3 •HR 4913 IH ing the prescription drug plan may not im- 1 pose limits on access to a covered generic 2 drug required to be included on the for- 3 mulary under clause (i)(I) or a covered 4 biosimilar biological product required to be 5 included on the formulary under clause 6 (i)(II), including through prior authoriza- 7 tion, utilization management, or step ther- 8 apy, that are more restrictive than any 9 such limits imposed on access to the ref- 10 erence drug of such covered generic drug 11 or reference biological product of such cov- 12 ered biosimilar biological product, respec- 13 tively, or that otherwise have the effect of 14 giving preferred status to such reference 15 drug or reference biological product over 16 such covered generic drug or covered bio- 17 similar biological product, respectively. 18 ‘‘(iii) DEFINITIONS.—In this subpara- 19 graph and subparagraph (J): 20 ‘‘(I) COVERED BIOSIMILAR BIO- 21 LOGICAL PRODUCT.—The term ‘cov- 22 ered biosimilar biological product’ 23 means a covered part D drug that is 24 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 4 •HR 4913 IH a biosimilar biological product (as de- 1 fined in section 1847A(c)(6)(H)). 2 ‘‘(II) COVERED GENERIC 3 DRUG.—The term ‘covered generic 4 drug’ means a covered part D drug 5 that is a drug described in section 6 1860D–2(e)(1)(A) and approved 7 under section 505(j) of the Federal 8 Food, Drug, and Cosmetic Act. 9 ‘‘(III) REFERENCE BIOLOGICAL 10 PRODUCT.—The term ‘reference bio- 11 logical product’ has the meaning given 12 such term in section 1847A(c)(6)(I). 13 ‘‘(IV) REFERENCE DRUG.—The 14 term ‘reference drug’ means, with re- 15 spect to a covered generic drug, the 16 listed drug (as described in clause (i) 17 of section 505(j)(2)(A) of the Federal 18 Food, Drug, and Cosmetic Act) that 19 is referred to in the abbreviated appli- 20 cation for such covered generic drug 21 under such section. 22 ‘‘(V) WHOLESALE ACQUISITION 23 COST.—The term ‘wholesale acquisi- 24 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 5 •HR 4913 IH tion cost’ has the meaning given such 1 term in section 1847A(c)(6)(B). 2 ‘‘(J) COST-SHARING TIERING REQUIRE- 3 MENTS WITH RESPECT TO COVERED GENERIC 4 DRUGS AND COVERED BIOSIMILAR BIOLOGICAL 5 PRODUCTS.— 6 ‘‘(i) GENERIC DRUG COST-SHARING 7 TIER.—With respect to a plan year begin- 8 ning on or after January 1, 2021, the 9 PDP sponsor offering the prescription 10 drug plan shall— 11 ‘‘(I) have at least one cost-shar- 12 ing tier on the formulary that only in- 13 cludes covered generic drugs and cov- 14 ered biosimilar biological products; 15 and 16 ‘‘(II) apply a cost-sharing re- 17 quirement with respect to each cost- 18 sharing tier described in subclause (I) 19 on the formulary that is meaningfully 20 lesser than the lowest cost-sharing re- 21 quirement applicable with respect to 22 any cost-sharing tier on such for- 23 mulary that includes a brand drug 24 (referred to in this subparagraph as 25 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 6 •HR 4913 IH the ‘lowest brand drug cost-sharing 1 tier’). 2 ‘‘(ii) SPECIALTY GENERIC DRUG COST- 3 SHARING TIER.—With respect to a plan 4 year beginning on or after January 1, 5 2021, if the PDP sponsor offering the pre- 6 scription drug plan has a cost-sharing tier 7 for specialty brand drugs on the formulary, 8 the PDP sponsor shall— 9 ‘‘(I) have a cost-sharing tier on 10 such formulary that only includes cov- 11 ered generic drugs and covered bio- 12 similar biological products— 13 ‘‘(aa) for which the whole- 14 sale acquisition cost is greater 15 than a threshold specified by the 16 Secretary; and 17 ‘‘(bb) with respect to which 18 the reference drug for such a 19 covered generic drug or the ref- 20 erence biological product for such 21 a covered biosimilar biological 22 product is either included on a 23 cost-sharing tier on such for- 24 mulary with a cost-sharing re- 25 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 7 •HR 4913 IH quirement that is greater than 1 the cost-sharing requirement ap- 2 plied under subclause (II), or ex- 3 cluded from such formulary; and 4 ‘‘(II) apply a cost-sharing re- 5 quirement with respect to the cost- 6 sharing tier required for the for- 7 mulary under subclause (I) that is 8 meaningfully lesser than the cost- 9 sharing requirement applicable with 10 respect to the cost-sharing tier for 11 specialty brand drugs on such for- 12 mulary. 13 ‘‘(iii) PLACEMENT OF CERTAIN GE- 14 NERIC DRUGS AND BIOSIMILAR BIOLOGI- 15 CAL PRODUCTS.—Each covered generic 16 drug and each covered biosimilar biological 17 product required to be included on the for- 18 mulary under subparagraph (I)(i) shall be 19 included either on a cost-sharing tier de- 20 scribed in clause (i)(I) or, if applicable, the 21 cost-sharing tier required for the formulary 22 under clause (ii)(I). 23 ‘‘(iv) DEFINITIONS.—In this subpara- 24 graph: 25 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 8 •HR 4913 IH ‘‘(I) BRAND DRUG.—The term 1 ‘brand drug’ means a covered part D 2 drug that is a drug described in sec- 3 tion 1860D–2(e)(1)(A) and approved 4 under section 505(c) of the Federal 5 Food, Drug, and Cosmetic Act. 6 ‘‘(II) MEANINGFULLY LESSER.— 7 The term ‘meaningfully lesser’ 8 means— 9 ‘‘(aa) for purposes of sub- 10 clause (II) of clause (i), such a 11 lesser cost-sharing requirement 12 that the Secretary determines 13 will likely significantly incentivize 14 the utilization of covered generic 15 drugs and covered biosimilar bio- 16 logical products on a cost-sharing 17 tier described in subclause (I) of 18 such clause on a formulary over 19 covered part D drugs on the low- 20 est brand drug cost-sharing tier 21 on such formulary; and 22 ‘‘(bb) for purposes of sub- 23 clause (II) of clause (ii), such a 24 lesser cost-sharing requirement 25 VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS 9 •HR 4913 IH that the Secretary determines 1 will likely significantly incentivize 2 the utilization of covered generic 3 drugs and covered biosimilar bio- 4 logical products on the cost-shar- 5 ing tier required for the for- 6 mulary under subclause (I) of 7 such clause over covered part D 8 drugs on the cost-sharing tier for 9 specialty brand drugs on such 10 formulary. 11 ‘‘(III) SPECIALTY BRAND 12 DRUG.—The term ‘specialty brand 13 drug’ means a brand drug for which 14 the wholesale acquisition cost is great- 15 er than a threshold specified by the 16 Secretary.’’. 17 (b) CONFORMING AMENDMENT.—Section 1860D– 18 2(b)(2)(B) of the Social Security Act (42 U.S.C. 1395w– 19 102(b)(2)(B)) is amended by inserting before the period 20 the following: ‘‘and section 1860D–4(b)(3)(J)’’. 21 Æ VerDate Sep 11 2014 04:00 Nov 06, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6301 E:\BILLS\H4913.IH H4913 kjohnson on DSK79L0C42 with BILLS