I 
117TH CONGRESS 
1ST SESSION H. R. 4418 
To amend title XI of the Social Security Act to provide for drug manufacturer 
price transparency. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 13, 2021 
Mr. HORSFORD (for himself, Mr. RASKIN, Ms. SPANBERGER, and Ms. NOR-
TON) 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 juris-
diction of the committee concerned 
A BILL 
To amend title XI of the Social Security Act to provide 
for drug manufacturer price transparency. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Stopping the Pharma-
ceutical Industry from Keeping drugs Expensive Act’’ or 
the ‘‘SPIKE Act’’. 
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SEC. 2. DRUG MANUFACTURER PRICE TRANSPARENCY. 
Title XI of the Social Security Act (42 U.S.C. 1301 
et seq.) is amended by inserting after section 1128K the 
following new section: 
‘‘SEC. 
1128L. 
DRUG 
MANUFACTURER 
PRICE 
TRANS-
PARENCY. 
‘‘(a) IN GENERAL.—With respect to each year, begin-
ning with 2023, the Secretary shall, at least once during 
such year, determine if there is a triggered SPIKE in-
crease (in accordance with subsection (b)) with respect to 
an applicable drug (as defined in subsection (f)(1)). If the 
Secretary determines, with respect to a year, there is such 
an increase with respect to an applicable drug, the manu-
facturer of the applicable drug shall submit to the Sec-
retary the justification described in subsection (c), subject 
to subsection (b)(3), for each such triggered SPIKE in-
crease in accordance with the timing described in sub-
section (d). 
‘‘(b) TRIGGERED SPIKE INCREASE.— 
‘‘(1) IN
GENERAL.—A triggered SPIKE in-
crease occurs, with respect to an applicable drug and 
year (beginning with 2023), in any of the following 
cases: 
‘‘(A) If there is a 10 percent (or $10,000) 
increase with respect to the wholesale acquisi-
tion cost (or alternative cost measure specified 
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by the Secretary under paragraph (2)) of such 
drug during any 12-month period beginning 
and ending within the lookback period that is 
the 5-year period preceding 2023 or 2024, re-
spectively. 
‘‘(B) If there is a 25 percent (or $25,000) 
increase with respect to the wholesale acquisi-
tion cost (or such alternative cost measure) of 
such drug during any 36-month period begin-
ning and ending within such respective lookback 
period. 
‘‘(C) In the case of such a drug that is 
first covered under title XVIII with respect to 
such year, if the estimated cost or spending 
under such title per individual or per user of 
such drug (as estimated by the Secretary) for 
such year (or per course of treatment, as de-
fined by the Secretary) is at least $26,000. 
‘‘(2) ALTERNATIVE
TO
WAC.—The Secretary 
may, for purposes of making determinations under 
paragraph (1), in addition to using the wholesale ac-
quisition cost for an applicable drug, use alternative 
cost measures of such drug. 
‘‘(3) EXCEPTION.—A justification under sub-
section (c) shall not be required for a triggered 
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‘‘(i) the total revenue and net profit of 
the manufacturer for the period of such in-
crease, as determined by the Secretary; 
‘‘(ii) metrics used to determine execu-
tive compensation; 
‘‘(iii) total expenditures on— 
‘‘(I) drug research and develop-
ment; or 
‘‘(II) clinical trials on drugs that 
failed to receive approval by the Food 
and Drug Administration; and 
‘‘(iv) any additional information re-
lated to drug pricing decisions of the man-
ufacturer. 
‘‘(G) Any other relevant information and 
supporting documentation necessary to justify 
the triggering SPIKE increase. 
‘‘(H) Any other relevant information and 
supporting documentation, as specified by the 
Secretary. 
‘‘(4) CERTIFICATION.—For purposes of para-
graph (1), the certification described in this para-
graph is a certification, that all such information 
and documentation is accurate and complete, by one 
of the following: 
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‘‘(A) The chief executive officer of the 
manufacturer. 
‘‘(B) The chief financial officer of the 
manufacturer. 
‘‘(C) An individual who has delegated au-
thority to sign for, and who reports directly to, 
such chief executive officer or chief financial of-
ficer. 
‘‘(d) TIMING.— 
‘‘(1) NOTIFICATION.—Not later than 60 days 
after the date on which the Secretary makes the de-
termination that there is a triggering SPIKE in-
crease with respect to an applicable drug, the Sec-
retary shall notify the manufacturer of the applica-
ble drug of such determination. 
‘‘(2) SUBMISSION
OF
JUSTIFICATION.—Not 
later than 90 days after the date on which a manu-
facturer receives a notification under paragraph (1), 
subject to subsection (b)(3), the manufacturer shall 
submit to the Secretary the justification required 
under subsection (a), including a summary of such 
justification, in a form and manner specified by the 
Secretary. In specifying such form, with respect to 
the summary required under the previous sentence, 
the Secretary shall provide that such summary shall 
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be in an easily understandable format, as specified 
by the Secretary, and shall permit the manufacturer 
to exclude proprietary information from such sum-
mary. 
‘‘(3) POSTING
ON
INTERNET
WEBSITE.—Not 
later than 30 days after receiving the complete jus-
tification under paragraph (2), the Secretary shall 
post on the Internet website of the Centers for Medi-
care & Medicaid Services the summary included for 
such justification. 
‘‘(e) PENALTIES.— 
‘‘(1) FAILURE TO SUBMIT TIMELY JUSTIFICA-
TION.—If the Secretary determines that a manufac-
turer has failed to submit a justification as required 
under this section, including in accordance with the 
timing and form required, with respect to an appli-
cable drug, the Secretary shall apply a civil mone-
tary penalty in an amount of $10,000 for each day 
the manufacturer has failed to submit such justifica-
tion as so required. 
‘‘(2) FALSE INFORMATION.—Any manufacturer 
that submits a justification under this section that 
knowingly provides false information in such jus-
tification is subject to a civil monetary penalty in an 
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amount not to exceed $100,000 for each item of 
false information. 
‘‘(3) APPLICATION OF PROCEDURES.—The pro-
visions of section 1128A (other than subsections (a) 
and (b)) shall apply to a civil monetary penalty 
under this subsection in the same manner as such 
provisions apply to a penalty or proceeding under 
section 1128A(a). Civil monetary penalties imposed 
under this subsection are in addition to other pen-
alties as may be prescribed by law. 
‘‘(f) DEFINITIONS.—In this section: 
‘‘(1) APPLICABLE DRUG.— 
‘‘(A) IN GENERAL.—Subject to paragraph 
(2), the term ‘applicable drug’ means, with re-
spect to a lookback period described in para-
graph (2), a covered outpatient drug (as de-
fined in paragraph (2) of section 1927(k), with-
out application of paragraph (3) of such sec-
tion) that is covered under title XVIII and is 
not a low cost drug. 
‘‘(B) EXCLUSION OF LOW COST DRUGS.— 
For purposes of subparagraph (A)(iii), not later 
than January 1, 2023, the Secretary shall 
specify a threshold (such as a cost or spending 
threshold) for identifying (and shall identify) 
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low cost drugs to be excluded from the defini-
tion of the term ‘applicable drug’, such as a 
drug that has a wholesale acquisition cost of 
less than $10 per unit or less than $100 in av-
erage estimated expenditures under title XVIII 
per individual per year or per user of such drug 
per year. For purposes of this section, a drug 
shall not be considered specified as a low cost 
drug for a lookback period described in para-
graph (2) with respect to a year unless such 
drug is identified as being below the specified 
threshold for the entirety of the lookback pe-
riod. 
‘‘(2) MANUFACTURER.—The term ‘manufac-
turer’ has the meaning given that term in section 
1847A(c)(6)(A). 
‘‘(3) WHOLESALE
ACQUISITION
COST.—The 
term ‘wholesale acquisition cost’ has the meaning 
given that term in section 1847A(c)(6)(B).’’. 
Æ 
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