NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A7588
SPONSOR: Gottfried (MS)
TITLE OF BILL: An act to amend the public health law, in relation to
creating a wholesale prescription drug importation program
PURPOSE OR GENERAL IDEA OF BILL:
to create a state program to import prescription drugs from other coun-
tries at lower cost.
SUMMARY OF SPECIFIC PROVISIONS:
The Commissioner of Health will seek federal certification for a program
under which an approved wholesaler may import drugs that meet U.S. Food
and Drug Administration standards from only suppliers who are regulated
and authorized under the laws of their country for distribution and sale
only in New York.
The operation of the program will be funded by annual fees paid by the
authorized wholesaler. The Commissioner will make regulations to require
and authorized wholesaler application process, reporting and audits;
collaborate with the Attorney General to combat fraud; seek all required
federal approvals for participation including those required for the
340-B program; and report annually to the legislature.
Concern about drug pricing is at an all-time high. Studies show how
U.S. consumers pay the highest prices in the world for life-saving and
enhancing drug treatments. The prices we pay may fund the research and
development that benefits the entire world but those same prices make
treatment options unavailable here at home if patients cannot afford
their medicines or public programs cannot finance expensive treatments
for everyone in need. Drug importation is high on the list of solutions
the public wants to pursue.
Federal law allows the Secretary of Health and Human Services (HHS) to
certify programs for personal and wholesale importation from countries
such as Canada if consumer safety is on par with the U.S. drug supply
chain system and significant consumer cost savings are realized.
Under the federal law, shipments from Canada, for example, will be test-
ed on a sample basis for purity and potency and products would be
labeled properly for the U.S. market and distributed to retail pharma-
cies and other settings included in the program. Just as in the regular
commercial market, retail pharmacies and other dispensing settings order
and pay for products, and administrative costs set by the Commissioner.
The product acquisition cost will be the Canadian price. Pharmacies and
other dispensers will charge the Canadian price without mark-up, except
for cost-based dispensing fee, for uninsured people or people in their
deductible period. Health plans and other payers will pay dispensers for
the product at the Canadian price without mark-up except for cost-based
Medical care is a fundamental fact of life at some point or another, but
the burden of paying for that care should not, on its own, be the death
PRIOR LEGISLATIVE HISTORY:
STATE OF NEW YORK
2019-2020 Regular Sessions
May 10, 2019
Introduced by M. of A. GOTTFRIED, ARROYO, ASHBY, BARRON, BLAKE, CAHILL,
COOK, DINOWITZ, ENGLEBRIGHT, GALEF, GUNTHER, HUNTER, LAVINE, LIFTON,
MAGNARELLI, M. G. MILLER, MONTESANO, MOSLEY, ORTIZ, RAMOS, RIVERA,
L. ROSENTHAL, SEAWRIGHT, SIMON, ZEBROWSKI -- Multi-Sponsored by -- M.
of A. LUPARDO, THIELE -- read once and referred to the Committee on
AN ACT to amend the public health law, in relation to creating a whole-
sale prescription drug importation program
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Title 2 of article 2-A of the public health law is amended
2 by adding a new section 280-d to read as follows:
3 § 280-d. Wholesale prescription drug importation program. 1. (a)
4 There is hereby created in the department a wholesale prescription drug
5 importation program.
6 (b) As used in this section, unless the context clearly requires
7 otherwise, the following terms shall have the following meanings:
8 (i) "Wholesale prescription drug importation program" or "program"
9 means the wholesale prescription drug importation program created under
10 this section.
11 (ii) "Prescription drug wholesaler" means an entity authorized to
12 acquire prescription drugs and sell or distribute them wholesale in the
14 (iii) "Approved wholesaler" means a prescription drug wholesaler
15 approved under this section to participate in the program.
16 (c) The commissioner shall develop and implement the program in
17 consultation with interested stakeholders and appropriate federal offi-
18 cials. The program shall comply with applicable federal requirements,
19 including 21 U.S.C. § 384, and requirements regarding safety and cost
20 savings. Under the program:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 is old law to be omitted.
A. 7588 2
1 (i) the commissioner shall approve one or more prescription drug
2 wholesalers to seek federal certification and approval to import
3 prescription drugs from one or more other countries, to be sold or
4 distributed wholesale in the state;
5 (ii) prescription drugs shall only be acquired from suppliers regu-
6 lated and authorized under the laws of the other country or a jurisdic-
7 tion thereof;
8 (iii) only prescription drugs meeting the U.S. Food and Drug Adminis-
9 tration's safety, effectiveness, and other standards shall be imported
10 under the program;
11 (iv) only prescription drugs expected to generate substantial savings
12 for consumers shall be imported;
13 (v) the approved wholesaler shall at all times comply with the track-
14 ing and tracing requirements of 21 U.S.C. §§ 360eee and 360eee-1 to the
15 extent feasible and practical, including prior to imported prescription
16 drugs coming into its possession;
17 (vi) an approved wholesaler shall not sell or distribute prescription
18 drugs imported under the program outside the state;
19 (vii) the commissioner may impose an annual fee on approved whole-
20 salers, which may be based in whole or in part on the value of
21 prescription drugs imported by the approved wholesaler under the
22 program, to support the operation of the program;
23 (viii) every approved wholesaler shall provide the commissioner with
24 information on its participation in the program as reasonably required
25 by the commissioner; the commissioner may provide for keeping certain
26 information confidential within the department where reasonably neces-
27 sary for successful operation of the program; and
28 (ix) the commissioner shall provide for auditing of the program,
29 including making sure that prescription drugs are made available at
30 substantial savings to consumers as a result of the program.
31 (d) The commissioner shall make regulations and take other actions
32 reasonably necessary to implement the program.
33 2. The commissioner shall consult with the attorney general to identi-
34 fy the potential for, and to monitor, anticompetitive behavior under or
35 in relation to the program.
36 3. (a) The commissioner shall seek all necessary approvals and certif-
37 ication by the secretary of the U.S. Department of Health and Human
38 Services or other appropriate federal officials or agencies for the
39 wholesale prescription drug importation program.
40 (b) The commissioner shall seek the appropriate federal approvals,
41 waivers, exemptions, or agreements, or a combination thereof, as needed
42 to enable all covered entities enrolled in or eligible for the federal
43 340B drug pricing program to participate in the wholesale prescription
44 drug importation program to the fullest extent possible without jeopard-
45 izing their eligibility for the 340B program.
46 4. The commissioner shall establish procedures for prescription drug
47 wholesalers to apply and be approved to be an approved wholesaler,
48 including requirements for periodic renewal of that approval. The
49 commissioner shall provide reasonable grounds for suspending or revoking
50 approval of an approved wholesaler under this section, including reason-
51 able provision for notice, opportunity to be heard, and appeal.
52 5. The commissioner shall annually report to the assembly committees
53 on health and on ways and means and the senate committees on health and
54 on finance regarding the operation of the wholesale prescription drug
55 importation program.
56 § 2. This act shall take effect immediately.