Directs the department of health to report to the legislature on the feasibility of entering into partnerships to increase competition, lower prices, and address shortages in the market for generic prescription drugs, to reduce the cost of prescription drugs for public and private purchasers, taxpayers, and consumers, and to increase patient access to affordable drugs; makes related provisions.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A8345B
SPONSOR: Rajkumar TITLE OF BILL:
An act in relation to requiring the department of health to report on
the feasibility of establishing a generic drug manufacturing program
aimed at reducing the cost of prescription drugs and to address short-
ages in the market for generic prescription drugs
PURPOSE:
To conduct a feasibility study on establishing a generic drug manufac-
turing program under the Department of Health aimed at reducing the cost
of prescription drugs and addressing market shortages.
SUMMARY OF PROVISIONS:
Section 1 requires the Department of Health to submit a report to the
legislature that assess the feasibility of establishing a generic drug
manufacturing program that would directly manufacture and sell generic
prescription drugs. The study would analyze governance structure options
for manufacturing functions, including the potential for public-private
partnerships, as well as the amount of staff required to oversee manu-
facturing, research and development costs, and the estimated volume of
prescription drugs and insulin that can be produced.
Section 2 sets forth an effective date of January 1 succeeding one year
after it becomes law.
JUSTIFICATION:
Prescription drugs costs, even for generics, continue to rise out of
reach for patients and insurers, both public and private. New York State
itself spends millions of dollars on prescription drugs through its
public health insurance programs and self-funded coverage of our state
workforce. One cause of drug price increases is lack of competition.
Nearly 90% of prescription drugs are generic, yet a small number of
companies manufacture them. Many contend this lack of competition has
led to large price increases of widely-used and important medications
like antibiotics and epinephrine without evidence of increased costs of
manufacturing. Aside from cost, there are some medications that are at
risk of being in short supply. It is important to find creative ways to
lower drug costs and ensure medications are available.
This legislation would require New York to consider partnering with
various entities, lower costs and protect against short supplies. It
directs the Commissioner of Health (COH) to identify generic drugs that
are high cost or susceptible to shortages for possible manufacturing
partnerships. A state-run manufacturing program for generic prescription
drugs and insulin can provide New York with an important tool to control
drug costs for its taxpayers, residents, and those who lack health
insurance by allowing New York. This study would determine how and what
this program would look like and prepare the Department of Health for
its role in manufacturing and selling generic prescription drugs.
LEGISLATIVE HISTORY:
This is a new bill.
FISCAL IMPLICATIONS:
Minimal.
EFFECTIVE DATE:
This act shall take effect first of January next succeeding one year
after it shall have become a law.
STATE OF NEW YORK
________________________________________________________________________
8345--B
2023-2024 Regular Sessions
IN ASSEMBLY
December 13, 2023
___________
Introduced by M. of A. RAJKUMAR, L. ROSENTHAL, SEAWRIGHT -- read once
and referred to the Committee on Health -- recommitted to the Commit-
tee on Health in accordance with Assembly Rule 3, sec. 2 -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee -- again reported from said committee with amend-
ments, ordered reprinted as amended and recommitted to said committee
AN ACT in relation to requiring the department of health to report on
the feasibility of establishing a generic drug manufacturing program
aimed at reducing the cost of prescription drugs and to address short-
ages in the market for generic prescription drugs
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. On or before January first, two thousand twenty-six, the
2 department of health shall submit a report to the legislature that
3 assesses the feasibility of establishing a generic drug manufacturing
4 program aimed at reducing the cost of prescription drugs and to address
5 shortages in the market for generic prescription drugs by directly manu-
6 facturing generic prescription drugs and selling generic prescription
7 drugs at a fair price. The report shall conduct an analysis of gover-
8 nance structure options for manufacturing functions, including charter-
9 ing a private organization, a public-private partnership, or a public
10 board of directors. Additionally, the report shall include, but not be
11 limited to an analysis of the:
12 (a) feasibility of entering into a partnership with a drug manufactur-
13 er to produce insulin and generic drugs for chronic and high-cost condi-
14 tions;
15 (b) feasibility of entering into a partnership with a drug manufactur-
16 er to produce and make generic prescription drugs widely available;
17 (c) generic prescription drugs that would have the greatest impact on
18 lowering drug costs to patients, including high-cost drugs, high utili-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08090-04-4
A. 8345--B 2
1 zation drugs, or drugs experiencing shortages in the market which the
2 program may prioritize;
3 (d) amount of staff required to oversee and manage the partnerships
4 for manufacturing or distribution of generic prescription drugs;
5 (e) research and development costs and start up costs associated with
6 the generic drug manufacturing program; and
7 (f) volume of generic prescription drugs and insulin that can be
8 produced over the first five years of the program.
9 § 2. This act shall take effect on the first of January next succeed-
10 ing one year after it shall have become a law.
