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1 | AN ACT concerning regulation.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 1. Short title. This Act may be cited as the | ||||||
5 | Pharmaceutical and Health Affordability: Restrictions on | ||||||
6 | Manufacturers' Amoral Behavior through Reasonable Oversight | ||||||
7 | Act. | ||||||
8 | Section 2. Legislative Findings. | ||||||
9 | (a) The General Assembly finds that public reports by | ||||||
10 | Congress and the news media have
demonstrated the devastating | ||||||
11 | impact that increasing drug prices can have on the
60% of | ||||||
12 | Americans and 90% of seniors that take prescription drugs. | ||||||
13 | (b) The General Assembly further finds that public reports | ||||||
14 | describe a repeated pattern and practice
of price gouging by | ||||||
15 | certain prescription drug manufacturers once they acquire the | ||||||
16 | ownership rights for a
new generic drug. | ||||||
17 | (c) The General Assembly further finds that price gouging | ||||||
18 | has forced patients to choose between
copayments exceeding | ||||||
19 | tens of thousands of dollars per year and risking their health | ||||||
20 | to find a more
affordable drug. | ||||||
21 | (d) The General Assembly further finds that this choice | ||||||
22 | has led patients to
delay or forgo necessary medications | ||||||
23 | creating greater health risks and complications. |
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1 | (e) The General Assembly concludes that addressing | ||||||
2 | accessibility of these life-saving medications
is a matter of | ||||||
3 | health, safety, and welfare for the People of the State of | ||||||
4 | Illinois. | ||||||
5 | Section 5. Definitions. As used in this Act: | ||||||
6 | "Essential off-patent or generic drug" means any | ||||||
7 | prescription drug sold within the State: | ||||||
8 | (1) for which all exclusive marketing rights, if any, | ||||||
9 | granted under the Federal Food, Drug, and Cosmetic Act, | ||||||
10 | Section 351 of the federal Public Health Service Act, and | ||||||
11 | federal patent law have expired; | ||||||
12 | (2) that appears on the model list of essential | ||||||
13 | medicines most recently adopted by the World Health | ||||||
14 | Organization or that has been designated by the United | ||||||
15 | States Secretary of Health and Human Services as an | ||||||
16 | essential medicine due to its efficacy in treating a | ||||||
17 | life-threatening health condition or a chronic health | ||||||
18 | condition that substantially impairs an individual's | ||||||
19 | ability to engage in activities of daily living; and | ||||||
20 | (3) that is actively manufactured and marketed for | ||||||
21 | sale in the United States by 3 or fewer manufacturers. | ||||||
22 | "Essential off-patent or generic drug" includes any | ||||||
23 | drug-device combination product used for the delivery of a | ||||||
24 | drug for which all exclusive marketing rights, if any, granted | ||||||
25 | under the Federal Food, Drug, and Cosmetic Act, Section 351 of |
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1 | the federal Public Health Service Act, and federal patent law | ||||||
2 | have expired. | ||||||
3 | "Manufacturer" has the meaning provided in Section 15 of | ||||||
4 | the Wholesale Drug Distribution Licensing Act. "Manufacturer" | ||||||
5 | does not include an entity operating as a wholesale drug | ||||||
6 | distributor as defined in Section 15 of the Wholesale Drug | ||||||
7 | Distribution Licensing Act. | ||||||
8 | "Price gouging" means an unconscionable increase in a | ||||||
9 | prescription drug's price that: | ||||||
10 | (1) would result in the wholesale acquisition cost of | ||||||
11 | a 30-day supply of the essential off-patent or generic | ||||||
12 | drug exceeding $20 and would result in an increase in the | ||||||
13 | wholesale acquisition cost of the essential off-patent or | ||||||
14 | generic drug of: | ||||||
15 | (A) 30% or more within the preceding year; | ||||||
16 | (B) 50% or more within the preceding 3 years; or | ||||||
17 | (C) 75% or more within the preceding 5 years; and | ||||||
18 | (2) is otherwise excessive and unduly burdens | ||||||
19 | consumers because of the importance of the essential | ||||||
20 | off-patent or generic drug to their health and because of | ||||||
21 | insufficient competition in the marketplace. | ||||||
22 | "Price gouging" does not include a price increase that can | ||||||
23 | be reasonably justified by: | ||||||
24 | (1) an increase in the cost of producing the essential | ||||||
25 | off-patent or generic drug; or | ||||||
26 | (2) the cost of appropriate expansion of access to the |
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1 | essential off-patent or generic drug to promote public | ||||||
2 | health. | ||||||
3 | "State health plan" means the program of health benefits | ||||||
4 | under the State Employees Group Insurance Act of 1971. | ||||||
5 | "Wholesale acquisition cost" has the meaning provided in | ||||||
6 | 42 U.S.C. 1395w-3a. | ||||||
7 | "Wholesale drug distributor" has the meaning provided in | ||||||
8 | Section 15 of the Wholesale Drug Distribution Licensing Act. | ||||||
9 | Section 10. Price gouging prohibited. | ||||||
10 | (a) A manufacturer or wholesale drug distributor shall not | ||||||
11 | engage in price gouging in the sale of an essential off-patent | ||||||
12 | or generic drug that is ultimately sold in Illinois. | ||||||
13 | It is not a violation of this Act for a wholesale | ||||||
14 | distributor to increase the price of an essential off-patent | ||||||
15 | or generic drug if the price increase is directly attributable | ||||||
16 | to an increase in the wholesale acquisition cost for the | ||||||
17 | essential off-patent or generic drug imposed on the wholesale | ||||||
18 | drug distributor by the manufacturer of the drug. | ||||||
19 | For the purpose of the enforcement of this Act, the | ||||||
20 | Director of Healthcare and Family Services shall notify the | ||||||
21 | Attorney General of any increase in the price of any essential | ||||||
22 | off-patent or generic drug under the Medical Assistance | ||||||
23 | Program under Section V of the Illinois Public Aid Code that | ||||||
24 | amounts to price gouging. | ||||||
25 | (b) If the Attorney General has reason to believe that a |
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1 | manufacturer or wholesale drug distributor of an essential | ||||||
2 | off-patent or generic drug has violated this Act, then the | ||||||
3 | Attorney General may send a notice to the manufacturer or the | ||||||
4 | wholesale drug distributor requesting a statement: | ||||||
5 | (1) itemizing the components of the cost of producing | ||||||
6 | the essential off-patent or generic drug; | ||||||
7 | (2) identifying the circumstances and timing of an | ||||||
8 | increase in materials or manufacturing costs that caused | ||||||
9 | an increase in the wholesale acquisition cost of the | ||||||
10 | essential off-patent or generic drug within the 5-year | ||||||
11 | period preceding the date of the price increase; | ||||||
12 | (3) identifying the circumstances and timing of any | ||||||
13 | expenditures made by the manufacturer to expand access to | ||||||
14 | the essential off-patent or generic drug and explaining | ||||||
15 | any improvement in public health associated with those | ||||||
16 | expenditures; | ||||||
17 | (4) identifying any communications with competitors of | ||||||
18 | distributors about that drug and any price
changes; the | ||||||
19 | request for a statement shall serve as a litigation hold | ||||||
20 | regarding documents and communications
about that drug; | ||||||
21 | and | ||||||
22 | (5) providing any other information that the | ||||||
23 | manufacturer or wholesale drug distributor believes to be | ||||||
24 | relevant to a determination of whether a violation of this | ||||||
25 | Act has occurred. | ||||||
26 | Within 45 days after receipt of the request, the |
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1 | manufacturer or wholesale drug distributor shall submit the | ||||||
2 | statement to the Attorney General. | ||||||
3 | To accomplish the objectives and carry out the duties | ||||||
4 | prescribed in this Act, the Attorney General may issue | ||||||
5 | subpoenas or examine under oath any person to determine | ||||||
6 | whether a manufacturer or wholesale drug distributor has | ||||||
7 | violated this Act. | ||||||
8 | (c) Upon petition of the Attorney General, a circuit court | ||||||
9 | may issue an order: | ||||||
10 | (1) compelling a manufacturer or a wholesale drug | ||||||
11 | distributor: | ||||||
12 | (A) to provide a statement required under | ||||||
13 | subsection (b); or | ||||||
14 | (B) to produce specific records or other documents | ||||||
15 | requested by the Attorney General that may be relevant | ||||||
16 | to a determination of whether a violation of this Act | ||||||
17 | has occurred; | ||||||
18 | (2) restraining or enjoining a violation of this Act; | ||||||
19 | (3) restoring to any consumer, including a third-party | ||||||
20 | payor, any money acquired as a result of a price increase | ||||||
21 | that violates this Act; | ||||||
22 | (4) requiring a manufacturer or wholesale drug | ||||||
23 | distributor that has engaged in price gouging in the sale | ||||||
24 | of an essential off-patent or generic drug to make the | ||||||
25 | drug available to participants in the State health plan or | ||||||
26 | Medical Assistance Program under Section V of the Illinois |
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1 | Public Aid Code for a period of up to one year at the price | ||||||
2 | at which the drug was made available to participants in | ||||||
3 | Illinois immediately before the violation of this Act; | ||||||
4 | (5) imposing a civil penalty of up to $10,000 per day | ||||||
5 | for each violation of this Act; | ||||||
6 | (6) providing for the Attorney General's recovery of | ||||||
7 | costs and disbursements incurred in
bringing an action | ||||||
8 | against a manufacturer found to be in violation of this | ||||||
9 | Act, including the costs of
investigation and reasonable | ||||||
10 | attorney's fees; or | ||||||
11 | (7) granting any other relief. | ||||||
12 | In response to any petition brought by the Attorney | ||||||
13 | General under this Section, a manufacturer or wholesale drug | ||||||
14 | distributor who is alleged to have violated this Act may not | ||||||
15 | assert as a defense that the manufacturer or wholesale drug | ||||||
16 | distributor did not directly sell a product to a consumer | ||||||
17 | residing in Illinois. | ||||||
18 | (d) Any financial information provided by a manufacturer | ||||||
19 | or a wholesale drug distributor to the Attorney General in | ||||||
20 | accordance with this Section may not be disclosed to the | ||||||
21 | public by the Attorney General. The financial information, | ||||||
22 | while in the possession of the Attorney General, shall be | ||||||
23 | exempt from disclosure by the Attorney General under the | ||||||
24 | Freedom of Information Act. Notwithstanding the other | ||||||
25 | provisions of this subsection, if it appears to the Attorney | ||||||
26 | General that a manufacturer or wholesale drug distributor has |
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1 | engaged in or is engaging in any practice declared to be in | ||||||
2 | violation of this Act and that legal proceedings would be in | ||||||
3 | the public interest, then the Attorney General may disclose | ||||||
4 | any financial information provided in accordance with this | ||||||
5 | Section in support of the filing of an action in the circuit | ||||||
6 | court. | ||||||
7 | Section 99. Effective date. This Act takes effect January | ||||||
8 | 1, 2024.
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