Title: To amend title XVIII of the Social Security Act to require PDP sponsors of a prescription drug plan under part D of the Medicare program that use a formulary to include certain generic drugs and biosimilar biological products on such formulary, and for other purposes.
Policy area: Health

Summary:
This bill establishes additional requirements for prescription drug plan (PDP) sponsors that use formularies under the Medicare prescription drug benefit.
Specifically, the bill requires PDP formularies to include covered generic drugs and biosimilars for which the wholesale acquisition cost is less than that of the reference (i.e., brand-name) product. PDP sponsors must also establish specific cost-sharing tiers that apply lower cost-sharing requirements for such covered generic drugs and biosimilars as compared to those for brand-name products.
The bill also prohibits PDP sponsors from instituting certain requirements relating to access to such covered generic drugs and biosimilars that are more restrictive than those for brand-name products (e.g., prior authorization requirements).

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4913 Introduced in House (IH)]

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116th CONGRESS
  1st Session
                                H. R. 4913

To amend title XVIII of the Social Security Act to require PDP sponsors 
 of a prescription drug plan under part D of the Medicare program that 
    use a formulary to include certain generic drugs and biosimilar 
     biological products on such formulary, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 30, 2019

 Mr. McKinley (for himself and Ms. Kuster of New Hampshire) 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 jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


 
To amend title XVIII of the Social Security Act to require PDP sponsors 
 of a prescription drug plan under part D of the Medicare program that 
    use a formulary to include certain generic drugs and biosimilar 
     biological products on such formulary, and for other purposes.

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

SECTION 1. REQUIREMENTS FOR PDP SPONSORS OF PRESCRIPTION DRUG PLANS 
              UNDER PART D OF THE MEDICARE PROGRAM THAT USE 
              FORMULARIES.

    (a) In General.--Section 1860D-4(b)(3) of the Social Security Act 
(42 U.S.C. 1395w-104(b)(3)) is amended by adding at the end the 
following new subparagraphs:
                    ``(I) Required inclusion of certain generic drugs 
                and biosimilar biological products.--
                            ``(i) In general.--With respect to a plan 
                        year beginning on or after January 1, 2021, the 
                        formulary shall include--
                                    ``(I) each covered generic drug for 
                                which the wholesale acquisition cost is 
                                less than the wholesale acquisition 
                                cost of the reference drug of such 
                                covered generic drug; and
                                    ``(II) each covered biosimilar 
                                biological product for which the 
                                wholesale acquisition cost is less than 
                                the wholesale acquisition cost of the 
                                reference biological product of such 
                                covered biosimilar biological product.
                            ``(ii) Prohibition on certain limits on 
                        access.--The PDP sponsor offering the 
                        prescription drug plan may not impose limits on 
                        access to a covered generic drug required to be 
                        included on the formulary under clause (i)(I) 
                        or a covered biosimilar biological product 
                        required to be included on the formulary under 
                        clause (i)(II), including through prior 
                        authorization, utilization management, or step 
                        therapy, that are more restrictive than any 
                        such limits imposed on access to the reference 
                        drug of such covered generic drug or reference 
                        biological product of such covered biosimilar 
                        biological product, respectively, or that 
                        otherwise have the effect of giving preferred 
                        status to such reference drug or reference 
                        biological product over such covered generic 
                        drug or covered biosimilar biological product, 
                        respectively.
                            ``(iii) Definitions.--In this subparagraph 
                        and subparagraph (J):
                                    ``(I) Covered biosimilar biological 
                                product.--The term `covered biosimilar 
                                biological product' means a covered 
                                part D drug that is a biosimilar 
                                biological product (as defined in 
                                section 1847A(c)(6)(H)).
                                    ``(II) Covered generic drug.--The 
                                term `covered generic drug' means a 
                                covered part D drug that is a drug 
                                described in section 1860D-2(e)(1)(A) 
                                and approved under section 505(j) of 
                                the Federal Food, Drug, and Cosmetic 
                                Act.
                                    ``(III) Reference biological 
                                product.--The term `reference 
                                biological product' has the meaning 
                                given such term in section 
                                1847A(c)(6)(I).
                                    ``(IV) Reference drug.--The term 
                                `reference drug' means, with respect to 
                                a covered generic drug, the listed drug 
                                (as described in clause (i) of section 
                                505(j)(2)(A) of the Federal Food, Drug, 
                                and Cosmetic Act) that is referred to 
                                in the abbreviated application for such 
                                covered generic drug under such 
                                section.
                                    ``(V) Wholesale acquisition cost.--
                                The term `wholesale acquisition cost' 
                                has the meaning given such term in 
                                section 1847A(c)(6)(B).
                    ``(J) Cost-sharing tiering requirements with 
                respect to covered generic drugs and covered biosimilar 
                biological products.--
                            ``(i) Generic drug cost-sharing tier.--With 
                        respect to a plan year beginning on or after 
                        January 1, 2021, the PDP sponsor offering the 
                        prescription drug plan shall--
                                    ``(I) have at least one cost-
                                sharing tier on the formulary that only 
                                includes covered generic drugs and 
                                covered biosimilar biological products; 
                                and
                                    ``(II) apply a cost-sharing 
                                requirement with respect to each cost-
                                sharing tier described in subclause (I) 
                                on the formulary that is meaningfully 
                                lesser than the lowest cost-sharing 
                                requirement applicable with respect to 
                                any cost-sharing tier on such formulary 
                                that includes a brand drug (referred to 
                                in this subparagraph as the `lowest 
                                brand drug cost-sharing tier').
                            ``(ii) Specialty generic drug cost-sharing 
                        tier.--With respect to a plan year beginning on 
                        or after January 1, 2021, if the PDP sponsor 
                        offering the prescription drug plan has a cost-
                        sharing tier for specialty brand drugs on the 
                        formulary, the PDP sponsor shall--
                                    ``(I) have a cost-sharing tier on 
                                such formulary that only includes 
                                covered generic drugs and covered 
                                biosimilar biological products--
                                            ``(aa) for which the 
                                        wholesale acquisition cost is 
                                        greater than a threshold 
                                        specified by the Secretary; and
                                            ``(bb) with respect to 
                                        which the reference drug for 
                                        such a covered generic drug or 
                                        the reference biological 
                                        product for such a covered 
                                        biosimilar biological product 
                                        is either included on a cost-
                                        sharing tier on such formulary 
                                        with a cost-sharing requirement 
                                        that is greater than the cost-
                                        sharing requirement applied 
                                        under subclause (II), or 
                                        excluded from such formulary; 
                                        and
                                    ``(II) apply a cost-sharing 
                                requirement with respect to the cost-
                                sharing tier required for the formulary 
                                under subclause (I) that is 
                                meaningfully lesser than the cost-
                                sharing requirement applicable with 
                                respect to the cost-sharing tier for 
                                specialty brand drugs on such 
                                formulary.
                            ``(iii) Placement of certain generic drugs 
                        and biosimilar biological products.--Each 
                        covered generic drug and each covered 
                        biosimilar biological product required to be 
                        included on the formulary under subparagraph 
                        (I)(i) shall be included either on a cost-
                        sharing tier described in clause (i)(I) or, if 
                        applicable, the cost-sharing tier required for 
                        the formulary under clause (ii)(I).
                            ``(iv) Definitions.--In this subparagraph:
                                    ``(I) Brand drug.--The term `brand 
                                drug' means a covered part D drug that 
                                is a drug described in section 1860D-
                                2(e)(1)(A) and approved under section 
                                505(c) of the Federal Food, Drug, and 
                                Cosmetic Act.
                                    ``(II) Meaningfully lesser.--The 
                                term `meaningfully lesser' means--
                                            ``(aa) for purposes of 
                                        subclause (II) of clause (i), 
                                        such a lesser cost-sharing 
                                        requirement that the Secretary 
                                        determines will likely 
                                        significantly incentivize the 
                                        utilization of covered generic 
                                        drugs and covered biosimilar 
                                        biological products on a cost-
                                        sharing tier described in 
                                        subclause (I) of such clause on 
                                        a formulary over covered part D 
                                        drugs on the lowest brand drug 
                                        cost-sharing tier on such 
                                        formulary; and
                                            ``(bb) for purposes of 
                                        subclause (II) of clause (ii), 
                                        such a lesser cost-sharing 
                                        requirement that the Secretary 
                                        determines will likely 
                                        significantly incentivize the 
                                        utilization of covered generic 
                                        drugs and covered biosimilar 
                                        biological products on the 
                                        cost-sharing tier required for 
                                        the formulary under subclause 
                                        (I) of such clause over covered 
                                        part D drugs on the cost-
                                        sharing tier for specialty 
                                        brand drugs on such formulary.
                                    ``(III) Specialty brand drug.--The 
                                term `specialty brand drug' means a 
                                brand drug for which the wholesale 
                                acquisition cost is greater than a 
                                threshold specified by the 
                                Secretary.''.
    (b) Conforming Amendment.--Section 1860D-2(b)(2)(B) of the Social 
Security Act (42 U.S.C. 1395w-102(b)(2)(B)) is amended by inserting 
before the period the following: ``and section 1860D-4(b)(3)(J)''.
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