An Act To Further Expand Drug Price Transparency
Maine Legislature, Session 129, LD 1162
Committee: Judiciary
Sponsors: VITELLI, TEPLER, FOLEY, JACKSON, KEIM, MILLETT, MELARAGNO, MOONEN, PRESCOTT, STEWART
Amends: 22 MRSA §8702, 22 MRSA §8703, 22 MRSA §8704, 22 MRSA §8710-A, 22 MRSA §8712

Legislative Document
No. 1162
S.P. 350
In Senate, March 7, 2019
An Act To Further Expand Drug Price Transparency
Reference to the Committee on Judiciary suggested and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by Senator VITELLI of Sagadahoc.
Cosponsored by Representative TEPLER of Topsham and
Senators: FOLEY of York, President JACKSON of Aroostook, KEIM of Oxford, MILLETT of 
Cumberland, Representatives: MELARAGNO of Auburn, MOONEN of Portland, PRESCOTT 
of Waterboro, STEWART of Presque Isle.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  22 MRSA c. 603, sub-c. 5 is enacted to read:
SUBCHAPTER 5
PRESCRIPTION DRUG PRICING FOR PURCHASERS
§2699-A.  Definitions
As used in this subchapter, unless the context otherwise indicates, the following 
terms have the following meanings.
1.  Course of therapy.  "Course of therapy" means:
A.  The recommended daily dosage units of a prescription drug pursuant to its 
prescribing label as approved by the federal Food and Drug Administration for 30 
days; or
B.  The recommended daily dosage units of a prescription drug pursuant to its 
prescribing label as approved by the federal Food and Drug Administration for a 
normal course of treatment that is less than 30 days.
2.  Office.  "Office" means the Maine Health Data Organization established under 
1683.
3.  Purchaser.  "Purchaser" means a State purchaser, an insurance company licensed 
in accordance with Title 24-A to provide health insurance, a health maintenance 
organization licensed pursuant to Title 24-A or a pharmacy benefit manager as defined in 
Title 24-A, section 1913 subsection 1, paragraph A.
4.  State purchaser.  "State purchaser" means a State entity that purchases or 
reimburses the purchase of prescription drugs.  "State purchaser" includes, but is not 
limited to, the Department of Health and Human Services, the Department of Corrections, 
the Department of Administrative and Financial Services, the Maine Public Employees 
Retirement System, and any entity that acts on behalf of a State entity that purchases or 
reimburses the purchase of prescription drugs.
5.  Wholesale acquisition cost.  "Wholesale acquisition cost" means the list price of 
a manufacturer to a wholesaler or direct purchaser in the United States, not including 
prompt pay or other discounts, rebates or reductions in price, as reported in wholesale 
price guides or other publications of pharmaceutical pricing data or as estimated by the 
organization using the all-payer claims data and the ingredient cost and list price and 
dispensing fee information that is submitted to the organization.
§2699-B.  Registration of purchasers
A purchaser may receive notification of increases in wholesale acquisition costs in 
accordance with section 2699-C if that purchaser registers with the office for the purpose 
of receiving such notification.  The office shall make available to manufacturers of 
prescription drugs a list of purchasers that are registered to receive notification pursuant 
to this section.
§2699-C.  Notification of increase in wholesale acquisition cost
1.  Notice by manufacturer.  If a prescription drug has a wholesale acquisition cost 
of more than $40 for a course of therapy and there is an increase in the wholesale 
acquisition cost of that prescription drug of more than 16%, including the proposed 
increase and the cumulative increases that occurred within the previous 2 calendar years 
prior to the current year, the manufacturer of the prescription drug shall provide notice in 
accordance with this subsection to every purchaser from whom it receives payment or 
reimbursement for that prescription drug.
A.  The manufacturer shall provide notice in writing at least 60 days prior to the 
planned effective date of the increase in the wholesale acquisition cost.
B.  The notice must include the date of the increase, the current wholesale acquisition 
cost of the prescription drug, and the dollar amount of the future increase in the 
wholesale acquisition cost of the prescription drug.
C.  The notice must include a statement regarding whether a change or improvement 
in the drug necessitates the price increase, and if applicable, the notice must describe 
the change or improvement.
2.  Notification by pharmacy benefit managers.  Upon receipt of notice of an 
increase in wholesale acquisition cost from a manufacturer of prescription drugs in 
accordance with subsection 1, a pharmacy benefits manager shall forward notice of that 
increase to any client that provides coverage to more than 500 individuals.
Sec. 2.  22 MRSA §8702, sub-§5-C is enacted to read:
5-C.  Manufacturer.  "Manufacturer" means a manufacturer of prescription drugs.
Sec. 3.  22 MRSA §8702, sub-§12 is enacted to read:
12.  Wholesale acquisition cost.  "Wholesale acquisition cost" means the list price of 
a manufacturer to a wholesaler or direct purchaser in the United States, not including 
prompt pay or other discounts, rebates or reductions in price, as reported in wholesale 
price guides or other publications of pharmaceutical pricing data or as estimated by the 
organization using the all-payer claims data and the ingredient cost and list price and 
dispensing fee information that is submitted to the organization.
Sec. 4.  22 MRSA §8703, sub-§1, as amended by PL 2003, c. 469, Pt. C, §22, is 
further amended to read:
1.  Objective.  The purposes of the organization are to create and maintain a useful, 
objective, reliable and comprehensive health information database that is used to improve 
the health of Maine citizens and to issue reports, as provided in section 8712.  This 
database must be publicly accessible while protecting patient confidentiality and 
respecting providers of care.  The organization shall collect, process, analyze and report 
clinical, financial, quality and, restructuring and prescription drug price data as defined in 
this chapter.
Sec. 5.  22 MRSA §8704, sub-§1, ¶A, as amended by PL 2003, c. 469, Pt. C, 
§23, is further amended to read:
A.  The board shall develop and implement policies and procedures for the collection, 
processing, storage and analysis of clinical, financial, quality and, restructuring and 
prescription drug price data in accordance with this subsection for the following 
purposes:
(1)  To use, build and improve upon and coordinate existing data sources and 
measurement efforts through the integration of data systems and standardization 
of concepts;
(2)  To coordinate the development of a linked public and private sector 
information system;
(3)  To emphasize data that is useful, relevant and not duplicative of existing 
data;
(4)  To minimize the burden on those providing data; and
(5)  To preserve the reliability, accuracy and integrity of collected data while 
ensuring that the data is available in the public domain.
Sec. 6.  22 MRSA §8710-A is enacted to read:
§8710-A.  Prescription drug price transparency
1.  Annual identification; list.  The organization shall annually identify and compile 
a list of the following prescription drugs, including brand name and generic drugs:
A.  The 25 most frequently prescribed drugs in the State;
B.  The 25 costliest drugs as determined by the total amount spent on those drugs in 
the State; and
C.  The 25 drugs with the highest year-over-year cost increases as determined by the 
total amount spent on those drugs in the State.
The list must also include along with each identified prescription drug the corresponding 
wholesale acquisition cost and the percentage of wholesale acquisition cost increase, if 
applicable.  The organization shall make the list and cost information compiled pursuant 
to this section available to the public and post it on the publicly accessible website of the 
organization.
2.  Required information.  Beginning July 1, 2021 and annually thereafter, the 
organization shall require the manufacturer of each of the drugs listed in subsection 1 to 
provide to the organization, in such form and format and on a schedule determined by the 
organization, information to explain prescription drug prices, including but not limited to 
the following:
A.  Total cost of production and total cost per dose of the drug;
B.  Research and development costs of the drug, including those costs paid with 
public funds, those costs reported as after-tax costs and those costs paid by 3rd 
parties;
C.  Marketing and advertising costs of the drug, including those costs directed to 
consumers, those costs directed to prescribers and the total of those costs directed to 
consumers and prescribers in the State;
D.  The retail prices of the drug charged to purchasers outside the United States in 
countries that are members of the Organisation of Economic Co-operation and 
Development or successor organization; and
E.  The retail prices of the drug typically charged to purchasers in the State, including 
but not limited to pharmacies, pharmacy wholesalers and other direct purchasers.
A manufacturer of a brand-name drug or a generic drug directed to provide information 
under this section shall provide the information within 60 days after the information is 
requested by the organization and shall certify as accurate the information provided.  The 
organization may request that a manufacturer provide additional information related to 
the information required in this subsection.
3.  Additional information.  A manufacturer of each of the drugs listed in subsection 
may voluntarily provide any other information the manufacturer determines relevant to 
the increase in wholesale acquisition cost, including but not limited to a description of all 
manufacturer-sponsored assistance programs for a drug identified in subsection 1 in the 
previous year, including the terms of the programs, the total amount of financial 
assistance provided to residents of the State and the average amount of assistance per 
resident of the State for whom assistance was provided.  Information provided by 
manufacturers pursuant to this subsection is not confidential and may be released in a 
manner that identifies both the individual drug to which the information pertains as well 
as the manufacturer.
4.  Reports to Legislature.  Beginning December 1, 2020 and annually thereafter, 
the organization shall submit a written report to the Legislature that includes the list of 
prescription drugs compiled pursuant to subsection 1 and their wholesale acquisition cost 
and cost increases, if any.  The organization may include in the report recommendations 
for improving the transparency of prescription drug pricing.  Beginning December 1, 
2021, the report must include a summary of the information provided by manufacturers 
pursuant to this section.  The organization shall post the report on the publicly accessible 
website of the organization.
5.  Confidentiality; exceptions.  Information provided by manufacturers pursuant to 
subsection 2, unless already publicly accessible or available or previously released in the 
public domain, must, at the request of the manufacturer, be held as confidential and not 
subject to public inspection and copying under the Freedom of Access Act.  The 
organization may release information that was previously accessible or available or 
released in the public domain.  The organization may release other information provided 
pursuant to subsection 2 except for information that is a trade secret as defined in Title 
10, section 1542, subsection 4.  The organization shall treat information submitted by 
manufacturers as Level II data in accordance with 90-590 CMR, Chapter 120, Release of 
Data to the Public.
6.  Penalties for noncompliance.  When a manufacturer violates the requirements of 
this section, the board may impose a fine of not more than $10,000 per day after the 
deadline for reporting required information.  If the manufacturer fails to pay a fine, or if 
an injunction is necessary, the board may refer the matter to the Attorney General.  The 
Attorney General may bring an action in Superior Court for injunctive relief, enforcement 
of fines, costs, attorney's fees and any other appropriate remedy.
7.  Legal ability to change prices.  Nothing in this section may be construed to 
restrict the legal ability of a manufacturer to change prices to the extent permitted under 
federal law.
Sec. 7.  22 MRSA §8712, sub-§5, as enacted by PL 2017, c. 406, §1, is repealed.
SUMMARY
This bill requires that, if a prescription drug has a wholesale acquisition cost of more 
than $40 for a course of therapy and there is an increase in the wholesale acquisition cost 
of that prescription drug of more than 16%, including the proposed increase and the 
cumulative increases that occurred within the previous two calendar years prior to the 
current year, the manufacturer of the prescription drug must provide notice to certain 
registered purchasers.
Under current law the Maine Health Data Organization, referred to as the 
"organization," is required to collect and report information with regard to the 25 
prescription drugs that are the most frequently prescribed in the State, the 25 costliest as 
determined by the total amount spent on those drugs in the State and the 25 drugs that 
have the highest year-over-year cost increases in total spending in the State.  This bill 
requires the organization to post online a list of the identified prescription drugs, along 
with the corresponding wholesale acquisition cost and the percentage of wholesale 
acquisition cost increase, if applicable, for each identified prescription drug.
The bill directs the organization to develop a plan to collect data from manufacturers 
that will help explain how prescription drug prices are established.  The organization is 
required to work with other state and national agencies and organizations to determine 
how to conduct the data collection.  The organization is required to submit the plan as 
well as any recommendations for legislation to the joint standing committee of the 
Legislature having jurisdiction over judiciary matters by April 1, 2020.  That committee 
may report out legislation to the First or Second Regular Session of the 130th Legislature.
Using the plan developed and reported to the Legislature, starting in 2021 the 
organization must require the manufacturer of each drug on the list to disclose drug 
production, research and development costs, marketing and advertising costs and actual 
costs paid by purchasers.  The manufacturer must certify the accuracy of the information 
and provide it within 60 days after the information is requested by the organization.  The 
organization is authorized to request additional information related to the required 
information.
The information that the manufacturers are directed to provide to the organization, 
unless the information is already publicly accessible or available or previously released in 
the public domain, must be held confidential at the request of the manufacturer. The 
organization may release information that was previously accessible or available or 
released in the public domain.  The organization may release additional information as 
long as the information released is not a trade secret.  The organization must treat the 
information as "Level II" information as required by rules that have already been adopted 
by the organization.
This amendment provides that the manufacturer may voluntarily provide any other 
information the manufacturer determines relevant to the increase in wholesale acquisition 
cost, including but not limited to information about all manufacturer-sponsored assistance 
programs for that drug in the previous year, including the terms of the programs, the total 
amount of financial assistance provided to residents of the State and the average amount 
of assistance per resident of the State for whom assistance was provided.  This 
information is not considered confidential and the organization may release it, identifying 
both the manufacturer and the individual drug.
The organization is required to submit an annual report to the Legislature based on 
the list of up to 75 drugs and the wholesale acquisition cost information.  The 
organization may include in the report recommendations for increasing prescription drug 
pricing transparency.  Once the organization starts collecting information from 
manufacturers in 2021, the report must also include at least a summary of the 
manufacturer information.  The organization is required to post the report online.
The bill provides that when a manufacturer violates the reporting requirements, the 
Board of Directors of the Maine Health Data Organization may impose a fine of not more 
than $10,000 per day after the deadline for reporting required information.  If the 
manufacturer fails to pay a fine, or if an injunction is necessary, the board may refer the 
matter to the Attorney General.  The Attorney General may bring an action in Superior 
Court for injunctive relief, enforcement of fines, costs, attorney's fees and any other 
appropriate remedy.
The legislation does not restrict the legal ability of a prescription drug manufacturer 
to change prices to the extent permitted under federal law.