I 
116TH CONGRESS 
1ST SESSION H. R. 3523 
To require the Secretary of Health and Human Services to establish reference 
prices for prescription drugs for purposes of Federal health programs, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 26, 2019 
Mr. WELCH (for himself and Mr. ROONEY of Florida) introduced the following 
bill; which was referred to the Committee on Energy and Commerce, and 
in addition to the Committees on Ways and Means, Armed Services, Vet-
erans’ Affairs, Oversight and Reform, and Natural Resources, for a pe-
riod to be subsequently determined by the Speaker, in each case for con-
sideration of such provisions as fall within the jurisdiction of the com-
mittee concerned 
A BILL 
To require the Secretary of Health and Human Services 
to establish reference prices for prescription drugs for 
purposes of Federal health programs, and for other pur-
poses. 
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 ‘‘End Price Gouging 
for Medications Act’’. 
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SEC. 2. REFERENCE PRICES FOR PRESCRIPTION DRUGS. 
(a) REFERENCE PRICES.—The Secretary of Health 
and Human Services (referred to in this section as the 
‘‘Secretary’’), in accordance with subsection (b), shall es-
tablish annual reference prices for each prescription drug. 
Notwithstanding any other provision of law, with respect 
to enrollees or beneficiaries in any of the Federal health 
programs described in subsection (c), the retail list price 
for a drug shall not exceed the reference price for such 
drug. 
(b) CRITERIA.— 
(1) IN
GENERAL.—Each year, the Secretary 
shall establish the reference price for each prescrip-
tion drug under subsection (a)— 
(A) by determining the median retail list 
price for the drug among the reference coun-
tries in which the drug is available, if drug pric-
ing information is available for at least three of 
such countries; or 
(B) in the case of a drug for which drug 
pricing information or dosage equivalents are 
not available for at least three of the reference 
countries, by determining an appropriate price 
based on the Secretary’s determination of— 
(i) the added therapeutic effect of the 
drug; 
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(ii) the value of the drug; 
(iii) patient access to the drug; 
(iv) the costs associated with re-
searching and developing the drug; and 
(v) other factors, as the Secretary de-
termines appropriate. 
(2) REFERENCE COUNTRIES.—For purposes of 
paragraph (1), the reference countries are Japan, 
Germany, the United Kingdom, France, Italy, Can-
ada, Australia, Spain, the Netherlands, Switzerland, 
and Sweden. 
(c) FEDERAL HEALTH PROGRAMS.—The reference 
prices established under subsection (a) shall apply with re-
spect to covered inpatient and outpatient drugs under— 
(1) the Medicare program under title XVIII of 
the Social Security Act (42 U.S.C. 1395 et seq.); 
(2) a State Medicaid plan under title XIX of 
the Social Security Act (42 U.S.C. 1396 et seq.); 
(3) the State Children’s Health Insurance Pro-
gram under title XXI of the Social Security Act (42 
U.S.C. 1397aa et seq.); 
(4) the TRICARE program under chapter 55 of 
title 10, United States Code; 
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(5) hospital care and medical services furnished 
by the Department of Veterans Affairs under chap-
ters 17 and 18 of title 38, United States Code; 
(6) the Federal Employees Health Benefits 
Program established under chapter 89 of title 5, 
United States Code; and 
(7) any health program, service, function, activ-
ity, or facility funded, in whole or part, under the 
Indian Health Care Improvement Act (25 U.S.C. 
1601 et seq.), including through direct or contract 
care provided under such Act or through a contract 
or compact under the Indian Self-Determination and 
Education Assistance Act (25 U.S.C. 5304 et seq.). 
(d) APPLICABILITY
TO OTHER PURCHASERS
OF 
DRUGS.—Notwithstanding any other provision of law, a 
drug manufacturer shall offer prescription drugs at the 
reference price to all individuals, including individuals who 
are not insured and individuals who are covered under a 
group health plan or group or individual health insurance 
coverage. In the case of individuals covered by a group 
health plan or group or individual health insurance cov-
erage, such requirement is met if the amount covered 
under such plan or coverage plus the cost-sharing amount 
does not exceed the reference price. 
(e) ENFORCEMENT.— 
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(1) CIVIL PENALTY.—A drug manufacturer who 
does not comply with the requirements of subsection 
(a) shall be subject to a civil penalty, for each year 
in which the violation occurs and with respect to 
each drug for which the violation occurs, in an 
amount equal to 5 times the difference between— 
(A) the total amount received by the man-
ufacturer for sales of the drug under the Fed-
eral health programs under subsection (c) for 
the year; less 
(B) the total amount the manufacturer 
would have received for sales of the drug under 
such programs for the year if the manufacturer 
had complied with subsection (a). 
(2) AMOUNTS
COLLECTED.—Each year, the 
Secretary of the Treasury shall transfer to the Di-
rector of the National Institutes of Health an 
amount equal to the amount collected in civil pen-
alties under subsection (e) for the previous year. The 
Director of the National Institutes of Health shall 
use amounts so transferred for purposes of con-
ducting drug research and development. 
(f) APPLICABILITY
TO
BRAND
AND
GENERIC 
DRUGS.—The reference price established under subsection 
(a) shall apply to drugs approved under subsection (c) or 
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(j) of section 505 of the Federal Food, Drug, and Cos-
metic Act (21 U.S.C. 355) or under subsection (a) or (k) 
of section 351 of the Public Health Service Act (42 U.S.C. 
262). 
Æ 
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