Drug Pricing Transparency Bill Now A LawJune 1, 2018
On Thursday Governor Dannel P. Malloy signed into law a major piece of legislation authored by Rep. Sean Scanlon (D-Guilford) to create groundbreaking transparency requirements for prescription drug pricing.
The new law, known as Public Act 18-41, was introduced by Scanlon, the House chair of the legislature’s Insurance and Real Estate Committee, and state Comptroller Kevin Lembo. The law’s major component requires drug companies to justify price increases when the price of a drug jumps by 20 percent in one year or by 50 percent over three years.
“The constant price increases of even the most basic prescription drugs are out of control and I’m thrilled the Governor signed our bill and that Connecticut consumers will finally get the answers they have been looking for when it comes to why costs keep going up,” Scanlon said.
In addition, the bill requires:
- Information about new drugs in the FDA approval pipeline so we can better plan for new drug spending on the state employee plan and Medicaid
- Insurers must include information on the top 25 highest cost drugs, top 25 with greatest increases and the portion of premium that increased because of drug spending on plan when they file their rates with the state Insurance Department
- Pharmacy benefit managers (PBMs) must disclose rebates they received from drug companies and amount of rebate they passed onto consumers versus the amount they retained. Connecticut would become the first state in the country to require this
- Insurers must either provide consumers with point of sale rebate at pharmacy counter or certify that they are using rebates to lower premiums
“Lowering drug prices for the people of Connecticut is my ultimate goal and the passage of Public Act 18-41 brings us one step closer to ultimately attaining desperately needed relief when it comes to drug prices,” Scanlon said.