II 

118TH CONGRESS 

1ST SESSION S. 1131 

To amend title XI of the Social Security Act and title XXVII of the Public 

Health Service Act to establish requirements with respect to prescription 

drug benefits. 

IN THE SENATE OF THE UNITED STATES 

MARCH 30, 2023 

Mr. BRAUN (for himself and Mrs. HYDE-SMITH) introduced the following bill; 

which was read twice and referred to the Committee on Health, Education, Labor, and Pensions 

A BILL 

To amend title XI of the Social Security Act and title XXVII 

of the Public Health Service Act to establish requirements with respect to prescription drug benefits. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Drug Price Trans5 parency Act of 2023’’. 

6 SEC. 2. REQUIREMENTS FOR PRESCRIPTION DRUG BENE7 FITS. 

8 (a) REMOVAL OF SAFE HARBOR PROTECTION FOR

9 REBATES INVOLVING PRESCRIPTION DRUGS AND ESTABVerDate Sep 11 2014 22:52 Apr 12, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1131.IS S1131

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1 LISHMENT OF NEW SAFE HARBOR PROTECTIONS IN2 VOLVING PRESCRIPTION DRUGS.— 

3 (1) REMOVAL OF SAFE HARBOR PROTECTION

4 FOR REBATES INVOLVING PRESCRIPTION DRUGS.— 

5 Section 1128B(b) of the Social Security Act (42 

6 U.S.C. 1320a–7b(b)) is amended— 

7 (A) in paragraph (3)(A), by striking ‘‘a 

8 discount’’ and inserting ‘‘subject to paragraph 

9 (5), a discount’’; and 

10 (B) by adding at the end the following: 

11 ‘‘(5) REMOVAL OF SAFE HARBOR PROTECTION

12 FOR REBATES INVOLVING PRESCRIPTION DRUGS.— 

13 The safe harbor described in paragraph (3)(A) shall 

14 not apply to a reduction in price or other remunera15 tion from a manufacturer of prescription drugs to a 

16 sponsor of a prescription drug plan under part D of 

17 title XVIII, an MA organization offering an MA–PD 

18 plan under part C of such title, or a pharmacy ben19 efit manager under contract with such a sponsor or 

20 such an organization and, except as provided in sub21 paragraphs (M) and (N) of paragraph (3), para22 graphs (1) and (2) shall apply to any such reduction 

23 in price or other remuneration.’’. 

24 (2) ESTABLISHMENT OF NEW SAFE HARBOR

25 PROTECTIONS INVOLVING PRESCRIPTION DRUGS.— 


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1 Section 1128B(b)(3) of the Social Security Act (42 

2 U.S.C. 1320a–7b(b)(3)) is amended— 

3 (A) in subparagraph (K), by striking 

4 ‘‘and’’ at the end; 

5 (B) in subparagraph (L), by striking the 

6 period at the end and inserting a semicolon; 

7 and 

8 (C) by adding at the end the following: 

9 ‘‘(M) a reduction in price offered by a 

10 manufacturer of prescription drugs to a sponsor 

11 of a prescription drug plan under part D of 

12 title XVIII, an MA organization offering an 

13 MA–PD plan under part C of such title, or a 

14 pharmacy benefit manager under contract with 

15 such a sponsor or such an organization, that is 

16 reflected at the point of sale to the individual 

17 and meets such other conditions as the Sec18 retary may establish; and 

19 ‘‘(N) flat fee service fees a manufacturer 

20 of prescription drugs pays to a pharmacy ben21 efit manager for services rendered to the manu22 facturer that relate to arrangements by the 

23 pharmacy benefit manager to provide pharmacy 

24 benefit management services to a health plan, if 

25 certain conditions established by the Secretary 


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1 are met, including requirements that the fees 

2 are transparent to the health plan.’’. 

3 (3) EFFECTIVE DATE.—The amendments made 

4 by this subsection shall take effect on January 1, 

5 2024. 

6 (b) REQUIREMENTS FOR PRIVATE INSURANCE

7 PLANS.— 

8 (1) IN GENERAL.—Part D of title XXVII of the 

9 Public Health Service Act (42 U.S.C. 300gg–111 et 

10 seq.) is amended by adding at the end the following: 

11 ‘‘SEC. 2799A–11. REQUIREMENTS WITH RESPECT TO PRE12 SCRIPTION DRUG BENEFITS. 

13 ‘‘(a) IN GENERAL.—A group health plan or a health 

14 insurance issuer offering group or individual health insur15 ance coverage shall not, and shall ensure that any entity 

16 that provides pharmacy benefits management services 

17 under a contract with any such health plan or health in18 surance coverage does not, receive from a drug manufac19 turer a reduction in price or other remuneration with re20 spect to any prescription drug received by an enrollee in 

21 the plan or coverage and covered by the plan or coverage, 

22 unless— 

23 ‘‘(1) any such reduction in price is reflected at 

24 the point of sale to the enrollee and meets such 

25 other conditions as the Secretary may establish; and 


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1 ‘‘(2) any such other remuneration is a flat fee2 based service fee that a manufacturer of prescription 

3 drugs pays to an entity that provides pharmacy ben4 efits management services for services rendered to 

5 the manufacturer that relate to arrangements by the 

6 pharmacy benefit manager to provide pharmacy ben7 efit management services to a health plan or health 

8 insurance issuer, if certain conditions established by 

9 the Secretary are met, including requirements that 

10 the fees are transparent to the health plan or health 

11 insurance issuer. 

12 ‘‘(b) ENTITY THAT PROVIDES PHARMACY BENEFITS

13 MANAGEMENT SERVICES.—For purposes of this section, 

14 the term ‘entity that provides pharmacy benefits manage15 ment services’ means— 

16 ‘‘(1) any person, business, or other entity that, 

17 pursuant to a written agreement with a group health 

18 plan or a health insurance issuer offering group or 

19 individual health insurance coverage, directly or 

20 through an intermediary— 

21 ‘‘(A) acts as a price negotiator on behalf of 

22 the plan or coverage; or 

23 ‘‘(B) manages the prescription drug bene24 fits provided by the plan or coverage, which 

25 may include the processing and payment of 


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1 claims for prescription drugs, the performance 

2 of drug utilization review, the processing of 

3 drug prior authorization requests, the adjudica4 tion of appeals or grievances related to the pre5 scription drug benefit, contracting with network 

6 pharmacies, controlling the cost of covered pre7 scription drugs, or the provision of related serv8 ices; or 

9 ‘‘(2) any entity that is owned, affiliated, or re10 lated under a common ownership structure with a 

11 person, business, or entity described in paragraph 

12 (1).’’. 

13 (2) ERISA.— 

14 (A) IN GENERAL.—Subpart B of part 7 of 

15 subtitle B of title I of the Employee Retirement 

16 Income Security Act of 1974 (29 U.S.C. 1185 

17 et seq.) is amended by adding at the end the 

18 following: 

19 ‘‘SEC. 726. REQUIREMENTS WITH RESPECT TO PRESCRIP20 TION DRUG BENEFITS. 

21 ‘‘(a) IN GENERAL.—A group health plan or a health 

22 insurance issuer offering group health insurance coverage 

23 shall not, and shall ensure that any entity that provides 

24 pharmacy benefits management services under a contract 

25 with any such health plan or health insurance coverage 


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1 does not, receive from a drug manufacturer a reduction 

2 in price or other remuneration with respect to any pre3 scription drug received by an enrollee in the plan or cov4 erage and covered by the plan or coverage, unless— 

5 ‘‘(1) any such reduction in price is reflected at 

6 the point of sale to the enrollee and meets such 

7 other conditions as the Secretary may establish; and 

8 ‘‘(2) any such other remuneration is a flat fee9 based service fee that a manufacturer of prescription 

10 drugs pays to an entity that provides pharmacy ben11 efits management services for services rendered to 

12 the manufacturer that relate to arrangements by the 

13 pharmacy benefit manager to provide pharmacy ben14 efit management services to a health plan or health 

15 insurance issuer, if certain conditions established by 

16 the Secretary are met, including requirements that 

17 the fees are transparent to the health plan or health 

18 insurance issuer. 

19 ‘‘(b) ENTITY THAT PROVIDES PHARMACY BENEFITS

20 MANAGEMENT SERVICES.—For purposes of this section, 

21 the term ‘entity that provides pharmacy benefits manage22 ment services’ means— 

23 ‘‘(1) any person, business, or other entity that, 

24 pursuant to a written agreement with a group health 

25 plan or a health insurance issuer offering group 


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1 health insurance coverage, directly or through an 

2 intermediary— 

3 ‘‘(A) acts as a price negotiator on behalf of 

4 the plan or coverage; or 

5 ‘‘(B) manages the prescription drug bene6 fits provided by the plan or coverage, which 

7 may include the processing and payment of 

8 claims for prescription drugs, the performance 

9 of drug utilization review, the processing of 

10 drug prior authorization requests, the adjudica11 tion of appeals or grievances related to the pre12 scription drug benefit, contracting with network 

13 pharmacies, controlling the cost of covered pre14 scription drugs, or the provision of related serv15 ices; or 

16 ‘‘(2) any entity that is owned, affiliated, or re17 lated under a common ownership structure with a 

18 person, business, or entity described in paragraph 

19 (1).’’. 

20 (B) CLERICAL AMENDMENT.—The table of 

21 contents of the Employee Retirement Income 

22 Security Act of 1974 is amended by inserting 

23 after the item relating to section 725 the fol24 lowing: 

‘‘Sec. 725. Requirements with respect to prescription drug benefits.’’. 

25 (3) IRC.— 


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1 (A) IN GENERAL.—Subchapter B of chap2 ter 100 of the Internal Revenue Code of 1986 

3 is amended by adding at the end the following: 

4 ‘‘SEC. 9826. REQUIREMENTS WITH RESPECT TO PRESCRIP5 TION DRUG BENEFITS. 

6 ‘‘(a) IN GENERAL.—A group health plan shall not, 

7 and shall ensure that any entity that provides pharmacy 

8 benefits management services under a contract with any 

9 such health plan does not, receive from a drug manufac10 turer a reduction in price or other remuneration with re11 spect to any prescription drug received by an enrollee in 

12 the plan and covered by the plan, unless— 

13 ‘‘(1) any such reduction in price is reflected at 

14 the point of sale to the enrollee and meets such 

15 other conditions as the Secretary may establish; and 

16 ‘‘(2) any such other remuneration is a flat fee17 based service fee that a manufacturer of prescription 

18 drugs pays to an entity that provides pharmacy ben19 efits management services for services rendered to 

20 the manufacturer that relate to arrangements by the 

21 pharmacy benefit manager to provide pharmacy ben22 efit management services to a health plan, if certain 

23 conditions established by the Secretary are met, in24 cluding requirements that the fees are transparent 

25 to the health plan. 


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1 ‘‘(b) ENTITY THAT PROVIDES PHARMACY BENEFITS

2 MANAGEMENT SERVICES.—For purposes of this section, 

3 the term ‘entity that provides pharmacy benefits manage4 ment services’ means— 

5 ‘‘(1) any person, business, or other entity that, 

6 pursuant to a written agreement with a group health 

7 plan, directly or through an intermediary— 

8 ‘‘(A) acts as a price negotiator on behalf of 

9 the plan; or 

10 ‘‘(B) manages the prescription drug bene11 fits provided by the plan, which may include the 

12 processing and payment of claims for prescrip13 tion drugs, the performance of drug utilization 

14 review, the processing of drug prior authoriza15 tion requests, the adjudication of appeals or 

16 grievances related to the prescription drug ben17 efit, contracting with network pharmacies, con18 trolling the cost of covered prescription drugs, 

19 or the provision of related services; or 

20 ‘‘(2) any entity that is owned, affiliated, or re21 lated under a common ownership structure with a 

22 person, business, or entity described in paragraph 

23 (1).’’. 

24 (B) CLERICAL AMENDMENT.—The table of 

25 sections for subchapter B of chapter 100 of the 


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1 Internal Revenue Code of 1986 is amended by 

2 adding at the end the following: 

‘‘Sec. 9816. Requirements with respect to prescription drug benefits.’’. 

3 (4) EFFECTIVE DATE.—The amendments made 

4 by paragraphs (1), (2), and (3) shall take effect on 

January 1, 5 TM. 

Æ 


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