I 
116TH CONGRESS 
1ST SESSION H. R. 2113 
To amend titles XI and XVIII of the Social Security Act to provide for 
drug manufacturer price transparency, to require certain manufacturers 
to report on product samples provided to certain health care providers, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 8, 2019 
Mr. NEAL (for himself and Mr. BRADY) introduced the following bill; which 
was referred to the Committee on Ways and Means, and in addition to 
the Committee on Energy and Commerce, for a period to be subsequently 
determined by the Speaker, in each case for consideration of such provi-
sions as fall within the jurisdiction of the committee concerned 
A BILL 
To amend titles XI and XVIII of the Social Security Act 
to provide for drug manufacturer price transparency, 
to require certain manufacturers to report on product 
samples provided to certain health care providers, and 
for other purposes. 
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 ‘‘Prescription Drug 
Sunshine, Transparency, Accountability and Reporting 
Act’’ or the ‘‘Prescription Drug STAR Act’’. 
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SEC. 2. DRUG MANUFACTURER PRICE TRANSPARENCY. 
(a) IN GENERAL.—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 2021, 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)(4), 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 an applicable drug and 
year (beginning with 2021 and referred to in this 
paragraph as the ‘applicable year’), in any of the fol-
lowing cases: 
‘‘(A) If there is at least a 10 percent (or 
$10,000) cumulative increase with respect to 
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the wholesale acquisition cost (or alternative 
cost measure specified by the Secretary under 
paragraph (3)) of such drug during a calendar- 
year period beginning and ending within the 
lookback period that is the 5-year period pre-
ceding such applicable year. 
‘‘(B) If there is at least a 25 percent (or 
$25,000) cumulative increase with respect to 
the wholesale acquisition cost (or such alter-
native cost measure) of such drug during any 
three-calendar-year period beginning and end-
ing within such lookback period. 
‘‘(C) In the case of such a drug that is 
first covered under title XVIII with respect to 
such applicable year, if the estimated cost or 
spending under such title per individual or per 
user of such drug (as estimated by the Sec-
retary) for such applicable year (or per course 
of treatment in such applicable year, as defined 
by the Secretary) is at least $26,000. 
‘‘(2) INDEXING DOLLAR AMOUNTS.—The dollar 
amounts applied under paragraph (1) for 2022 and 
each subsequent year shall be the dollar amounts 
specified in such paragraph for the previous year in-
creased by the annual percentage increase in the 
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consumer price index (all items; U.S. city average) 
as of September of such previous year. If any 
amount established under paragraph (1), after appli-
cation of this paragraph, for a year is not a multiple 
of $10, it shall be rounded to the nearest multiple 
of $10. 
‘‘(3) 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, or use such alternative 
cost measure if the wholesale acquisition cost is not 
available. 
‘‘(4) EXCEPTION.—A justification under sub-
section (c) shall not be required for a triggered 
SPIKE increase described in paragraph (1) of an 
applicable drug of a manufacturer if— 
‘‘(A) there is any portion of the lookback 
period described in the respective subparagraph 
of such paragraph for such increase that is in-
cluded within the lookback period for another 
triggered SPIKE increase (or combination of 
such increases) for which a justification is made 
under this section for such drug by such manu-
facturer; or 
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‘‘(B) such increase is less than the whole-
sale acquisition cost (or alternative cost meas-
ure specified by the Secretary under paragraph 
(3)) of such drug during the calendar-year pe-
riod described in paragraph (1)(A) or the three- 
calendar-year period described in paragraph 
(1)(B), as applicable, for such increase, in-
creased by the percentage increase in the con-
sumer price index for all urban consumers (all 
items; United States city average) for the 12- 
month period ending six months prior to the 
calendar-year period so described and for the 
36-month period ending six months prior to the 
three-calendar-year period so described, respec-
tively. 
‘‘(5) UNIT DETERMINATION.—For purposes of 
determining the wholesale acquisition cost in car-
rying out this section, the Secretary shall determine 
a unit (such as a unit size) to apply. 
‘‘(6) PUBLIC POSTING.—Beginning with respect 
to 2021, the Secretary shall publicly post on the 
Internet website of the Department of Health and 
Human Services— 
‘‘(A) 
alternative 
percentages, 
dollar 
amounts, and lookback periods that, if applied 
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under paragraph (1), would be projected to in-
crease the number of applicable drugs for which 
a triggered SPIKE increase would occur for 
such year; and 
‘‘(B) the number of applicable drugs for 
which a triggered SPIKE increase would occur 
for such year of such an alternative percentage, 
dollar amount, or period were applied for such 
year. 
‘‘(c) JUSTIFICATION DESCRIBED.— 
‘‘(1) IN GENERAL.—The justification described 
in this subsection, with respect to a triggered 
SPIKE increase described in subsection (b)(1) of an 
applicable drug of a manufacturer, is— 
‘‘(A) all of the information described in 
paragraph (2); 
‘‘(B) all of the information and supporting 
documentation described in paragraph (3), as 
applicable to the increase and drug; and 
‘‘(C) a certification described in paragraph 
(4). 
‘‘(2) REQUIRED INFORMATION.—For purposes 
of paragraph (1), the information described in this 
paragraph is the following: 
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‘‘(A) The individual factors that have con-
tributed to the increase in the wholesale acqui-
sition cost. 
‘‘(B) An explanation of the role of each 
factor in contributing to such increase. 
‘‘(3) INFORMATION AS APPLICABLE.—For pur-
poses of paragraph (1), the information and sup-
porting documentation described in this paragraph is 
the following, as applicable to the increase of the 
drug: 
‘‘(A) Total expenditures of the manufac-
turer on— 
‘‘(i) materials and manufacturing for 
such drug; 
‘‘(ii) acquiring patents and licensing 
for each drug of the manufacturer; and 
‘‘(iii) costs to purchase or acquire the 
drug from another company, if applicable. 
‘‘(B) The percentage of total expenditures 
of the manufacturer on research and develop-
ment for such drug that was derived from Fed-
eral funds. 
‘‘(C) The total expenditures of the manu-
facturer on research and development for such 
drug. 
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‘‘(D) The total revenue and net profit gen-
erated from the applicable drug for each cal-
endar year since drug approval. 
‘‘(E) The total costs associated with mar-
keting and advertising for the applicable drug. 
‘‘(F) Additional information specific to the 
manufacturer of the applicable drug, such as— 
‘‘(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. 
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‘‘(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: 
‘‘(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-
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facturer receives a notification under paragraph (1), 
subject to subsection (b)(4), 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 
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-
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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 
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 subpara-
graph (B), the term ‘applicable drug’ means, 
with respect to a lookback period described in 
subsection (b)(1), a covered outpatient drug (as 
defined in paragraph (2) of section 1927(k), 
without application of paragraph (3) of such 
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section) that is covered under title XVIII and 
is not a low cost drug. 
‘‘(B) EXCLUSION OF LOW COST DRUGS.— 
For purposes of subparagraph (A), not later 
than January 1, 2021, the Secretary shall 
specify a threshold (such as a cost or spending 
threshold) for identifying (and shall identify) 
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 sub-
section (b)(1) 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). 
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‘‘(3) WHOLESALE
ACQUISITION
COST.—The 
term ‘wholesale acquisition cost’ has the meaning 
given that term in section 1847A(c)(6)(B).’’. 
(b) REPORTING TO THE SECRETARY OF THE TREAS-
URY.— 
(1) IN GENERAL.—Subpart A of part III of 
subchapter A of chapter 61 of the Internal Revenue 
Code of 1986 is amended by inserting after section 
6039J the following new section: 
‘‘SEC. 6039K. DRUG PRICE SPIKE INCREASE REPORTING. 
‘‘Each manufacturer (within the meaning of section 
1128L of the Social Security Act) shall file a return (as 
such time and in such form and manner as the Secretary 
may provide) showing for each year with respect to which 
such section applies all information and supporting docu-
mentation and the certification included within a justifica-
tion reported by the manufacturer under subsection (c)(1) 
of such section.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions for subpart A of part III of subchapter A of 
chapter 61 of such Code is amended by inserting 
after the item relating to section 6039J the fol-
lowing new item: 
‘‘Sec. 6039K. Drug price SPIKE increase reporting.’’. 
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SEC. 3. REQUIREMENT FOR MANUFACTURERS OF CERTAIN 
DRUGS, DEVICES, BIOLOGICALS, AND MED-
ICAL SUPPLIES TO REPORT ON PRODUCT 
SAMPLES PROVIDED TO CERTAIN HEALTH 
CARE PROVIDERS. 
(a) IN GENERAL.—Section 1128G(a) of the Social 
Security Act (42 U.S.C. 1320a–7h(a)) is amended by add-
ing at the end the following new paragraph: 
‘‘(3) CERTAIN PRODUCT SAMPLES.— 
‘‘(A) IN GENERAL.—In addition to the re-
quirements under paragraphs (1)(A) and (2), 
on the 90th day of each calendar year (begin-
ning with 2023), any applicable manufacturer 
that provides a payment or other transfer of 
value that is a product sample described in sub-
paragraph (B) to any covered recipient (or to 
an entity or individual at the request of, or des-
ignated on behalf of, such a covered recipient) 
shall submit to the Secretary, in such electronic 
form as the Secretary shall require, the fol-
lowing information (aggregated per each drug, 
device, biological, or medical supply, as applica-
ble) with respect to the preceding calendar year: 
‘‘(i) The total quantity of all such 
payments or other transfers of value pro-
vided to all covered recipients. 
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‘‘(ii) The total value of all such pay-
ments or other transfers of value provided 
to all covered recipients. 
‘‘(iii) If applicable, information de-
scribed in clauses (vii) and (viii) of para-
graph (1)(A) with respect to such a pay-
ment or other transfer of value. 
‘‘(B) PRODUCT SAMPLE DESCRIBED.—For 
purposes of subparagraph (A), a product sam-
ple described in this subparagraph is a product 
sample that is not intended to be sold and is in-
tended for patient use.’’. 
(b) PUBLIC AVAILABILITY OF INFORMATION.—Sec-
tion 1128G(c)(1)(C)(ii) of the Social Security Act (42 
U.S.C. 1320a–7h(c)(1)(C)(ii)) is amended— 
(1) by striking ‘‘(ii) contains’’ and inserting 
‘‘(ii)(I) with respect to information that is not infor-
mation submitted under paragraph (3) of subsection 
(a), contains’’; 
(2) by striking ‘‘, as applicable;’’ and inserting 
‘‘, as applicable; and’’; and 
(3) by adding at the end the following new sub-
clause: 
‘‘(II) with respect to information sub-
mitted under paragraph (3) of subsection 
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(a), contains information that is presented 
by the name of the applicable manufac-
turer, the total amount of all payments or 
other transfers of value described in such 
paragraph provided to all covered recipi-
ents, the total value of all such payments 
or other transfers of value provided to all 
covered recipients, and the name of the 
covered drug, device, biological, or medical 
supply, as applicable;’’. 
(c) 
CONFORMING
AMENDMENT.—Section 
1128G(e)(10)(B)(ii) of the Social Security Act (42 U.S.C. 
1320a–7h(e)(10)(B)(ii)) is amended by striking ‘‘Product 
samples’’ and inserting ‘‘Except for purposes of paragraph 
(3) of subsection (a), product samples’’. 
(d) REPORTING TO THE SECRETARY OF THE TREAS-
URY.— 
(1) IN GENERAL.—Subpart A of part III of 
subchapter A of chapter 61 of the Internal Revenue 
Code of 1986, as amended by section 2, is further 
amended by inserting after section 6039K the fol-
lowing new section: 
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‘‘SEC. 6039L. PRODUCT SAMPLES OF APPLICABLE MANU-
FACTURERS. 
‘‘Each applicable manufacturer (within the meaning 
of section 1128G(a)(3) of the Social Security Act) shall 
file a return (as such time and in such form and manner 
as the Secretary may provide) showing for each year to 
which such section applies— 
‘‘(1) 
the 
amount 
described 
in 
section 
1128G(a)(3)(A)(ii) of such Act with respect to such 
year, and 
‘‘(2) the portion of such amount for which a de-
duction was claimed under section 162.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions for subpart A of part III of subchapter A of 
chapter 61 of such Code, as amended by section 2, 
is further amended by inserting after the item relat-
ing to section 6039K the following new item: 
‘‘Sec. 6039L. Product samples of applicable manufacturers.’’. 
SEC. 4. ANALYSIS AND REPORT ON INPATIENT HOSPITAL 
DRUG COSTS. 
(a) ANALYSIS.—The Secretary of Health and Human 
Services shall conduct an analysis that, to the extent prac-
ticable— 
(1) focuses on drugs that are furnished in the 
inpatient setting; 
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(2) includes data on inpatient hospital drug 
costs, Medicare spending, volume, and spending per 
admission; 
(3) considers trends in inpatient hospital drug 
costs, such as trends by hospital size, classification 
of urban or rural, whether the hospital is a teaching 
hospital, or other categorization; and 
(4) examines the impact of drug shortages on 
services that are furnished in an inpatient hospital 
setting. 
In conducting such analysis, the Secretary may conduct 
hospital surveys, use data from hospital cost reports, or 
use other data as determined by the Secretary. 
(b) REPORT.—Not later than January 1, 2021, the 
Secretary shall submit to the Committee on Ways and 
Means of the House of Representatives and the Finance 
Committee of the Senate a report on drug costs in the 
inpatient hospital setting, including the analyses described 
in paragraphs (1) through (4) of subsection (a). 
(c) FUNDING.—For purposes of carrying out this sec-
tion, there shall be transferred to the Secretary 
$3,000,000 from the Federal Hospital Insurance Trust 
Fund under section 1817 of the Social Security Act (42 
U.S.C. 1395i). 
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