II 

116TH CONGRESS 

1ST SESSION S. 1227 

To require the Federal Trade Commission to study the role of intermediaries 

in the pharmaceutical supply chain and provide Congress with appropriate policy recommendations, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

APRIL 29, 2019 

Mr. GRASSLEY (for himself, Ms. CANTWELL, Mr. DAINES, Mr. BLUMENTHAL, 

Mr. LANKFORD, and Ms. ERNST) introduced the following bill; which was 

read twice and referred to the Committee on the Judiciary 

A BILL 

To require the Federal Trade Commission to study the role 

of intermediaries in the pharmaceutical supply chain and 

provide Congress with appropriate policy recommendations, and for other purposes. 

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 ‘‘Prescription Pricing 

5 for the People Act of 2019’’. 

6 SEC. 2. DEFINITIONS. 

7 In this Act: 


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1 (1) APPROPRIATE COMMITTEES OF CON2 GRESS.—The term ‘‘appropriate committees of Con3 gress’’ means— 

4 (A) the Committee on the Judiciary of the 

5 Senate; and 

6 (B) the Committee on the Judiciary of the 

7 House of Representatives. 

8 (2) COMMISSION.—The term ‘‘Commission’’ 

9 means the Federal Trade Commission. 

10 SEC. 3. STUDY OF PHARMACEUTICAL SUPPLY CHAIN 

11 INTERMEDIARIES AND MERGER ACTIVITY. 

12 (a) REPORT.—Not later than 1 year after the date 

13 of enactment of this Act, the Commission shall submit to 

14 the appropriate committees of Congress a report that— 

15 (1) addresses at minimum— 

16 (A) whether pharmacy benefit managers— 

17 (i) charge payers (including Medicare 

18 and Medicaid) a higher price than the re19 imbursement rate at which the pharmacy 

20 benefit managers reimburses competing 

21 pharmacies while reimbursing pharmacies 

22 in which the pharmacy benefit managers 

23 have an ownership interest at the rate 

24 charged to payers; 


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1 (ii) steer patients to pharmacies in 

2 which the pharmacy benefit managers have 

3 an ownership interest; 

4 (iii) audit or review proprietary data, 

5 including acquisition costs, patient infor6 mation, or dispensing information, of com7 peting pharmacies that can be used for 

8 anticompetitive purposes; or 

9 (iv) use formulary designs to depress 

10 the market share of low-cost, lower-rebate 

11 prescription drugs; 

12 (B) the current state of competition in the 

13 pharmaceutical supply chain, particularly with 

14 regard to intermediaries and the recent vertical 

15 integrations of pharmacy benefit managers with 

16 insurance companies or other payers of pre17 scription drug benefits; 

18 (C) how companies and payers assess the 

19 benefits, costs, and risks of contracting with 

20 intermediaries, including pharmacy services ad21 ministrative organizations, and whether more 

22 information about the roles of intermediaries 

23 should be available to consumers and payers; 

24 and 


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1 (D) whether there are any specific legal or 

2 regulatory obstacles the Commission currently 

3 faces in ensuring a competitive and transparent 

4 marketplace in the pharmaceutical supply 

5 chain, including the pharmacy benefit manager 

6 marketplace and pharmacy services administra7 tive organizations; and 

8 (2) provides— 

9 (A) observations or conclusions drawn 

10 from the November 2017 roundtable entitled 

11 ‘‘Understanding Competition in Prescription 

12 Drug Markets: Entry and Supply Chain Dy13 namics’’, and any similar efforts; 

14 (B) specific actions the Commission in15 tends to take as a result of the November 2017 

16 roundtable, and any similar efforts, including a 

17 detailed description of relevant forthcoming ac18 tions, additional research or roundtable discus19 sions, consumer education efforts, or enforce20 ment actions; and 

21 (C) policy or legislative recommendations 

22 to— 

23 (i) improve transparency and competi24 tion in the pharmaceutical supply chain; 


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1 (ii) prevent and deter anticompetitive 

2 behavior in the pharmaceutical supply 

3 chain; and 

4 (iii) best ensure that consumers ben5 efit from any cost savings or efficiencies 

6 that may result from mergers and consoli7 dations. 

8 (b) INTERIM REPORT.—Not later than 180 days 

9 after the date of enactment of this Act, the Commission 

10 shall submit to the appropriate committees of Congress 

11 an interim report on the progress of the report required 

12 by subsection (a), along with preliminary findings and 

13 conclusions based on information collected to that date. 

Æ 


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