NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5653B
SPONSOR: Reyes TITLE OF BILL:
An act to amend the general business law, in relation to the price goug-
ing of medicine
PURPOSE OR GENERAL IDEA OF THE BILL:
This legislation adds medicine to the list of goods and services that
can be classified as possibly being subject to price gouging.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Amends subdivision 2.of section 396-r of the general business
law to add the phrase "drug shortage" to the definition of "abnormal
disruption of the market" and to further define the phrase "drug short-
age" to mean the issuance Of a notice by the U.S. Food and Drug Adminis-
tration declaring a drug shortage.
Section 2: Establishes the effective date.
DIFFERENCE FROM THE ORIGINAL VERSION OF THE BILL:
This bill clarifies the federal laws and agencies referred, to under the
statute.
JUSTIFICATION:
Price gouging of medicine is a well-documented and significant issue
that interferes with the ability of many people to access necessary
medication and contributes to soaring profits of some pharmaceutical
corporations. Price gouging of medication has a racially disparate
impact, with people of color and communities of color, as well as less
affluent communities in general, disproportionately impacted.
This bill originally was developed in the wake of workshops on improving
health care access for Latinos by the NYS Assembly Puerto Rican Hispanic
Task Force (PRHTF) during its annual legislative' conference in 2011.
Although this issue has gained prominent media attention, the problem
remains.
This bill would provide the New York State, through the Office of the
Attorney General with additional tools and authority to respond to price
gouging of medication and to, thereby, protect public health and ease
disparities in health-care access, treatment, and outcomes.
SOCIAL JUSTICE IMPACT:
This legislation would contribute to the right of New Yorkers to afford-
able and exceptional health care. This legislation would put the afford-
able treatment of New Yorkers over the profits of secondary market
companies.
The bill has been simplified by moving the price gouging of medicine
issue to the existing statutory provision relating to price, gouging
within the General Business Law.
Newest version of the bill makes a technical
PRIOR LEGISLATIVE HISTORY: A5860-B- 2021-2022 - Passed Both Houses,
Vetoed by the Governor (Memo 162)
A8801 of 2012, Passed Assembly every year since 2012 thru 2018. Died in
Senate each and every year since 2012 thru 2018.
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENT:
None
EFFECTIVE DATE:
This bill will take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
5653--B
Cal. No. 175
2023-2024 Regular Sessions
IN ASSEMBLY
March 20, 2023
___________
Introduced by M. of A. REYES, WILLIAMS, OTIS, WALSH -- read once and
referred to the Committee on Consumer Affairs and Protection --
committee discharged, bill amended, ordered reprinted as amended and
recommitted to said committee -- reported from committee, advanced to
a third reading, amended and ordered reprinted, retaining its place on
the order of third reading
AN ACT to amend the general business law, in relation to the price goug-
ing of medicine
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 2 of section 396-r of the general business
2 law, as amended by chapter 90 of the laws of 2020, is amended to read as
3 follows:
4 2. (a) During any abnormal disruption of the market for goods and
5 services vital and necessary for the health, safety and welfare of
6 consumers or the general public, no party within the chain of distrib-
7 ution of such goods or services or both shall sell or offer to sell any
8 such goods or services or both for an amount which represents an uncon-
9 scionably excessive price.
10 (b) For purposes of this section, the phrase "abnormal disruption of
11 the market" shall mean any change in the market, whether actual or immi-
12 nently threatened, resulting from stress of weather, convulsion of
13 nature, failure or shortage of electric power or other source of energy,
14 strike, civil disorder, war, military action, national or local emergen-
15 cy, drug shortage, or other cause of an abnormal disruption of the
16 market which results in the declaration of a state of emergency by the
17 governor.
18 (c) For purposes of this section, the term "drug shortage" shall mean,
19 with respect to any drug or medical product intended for human use, that
20 such drug or medical product is publicly reported as being subject to a
21 shortage by the U.S. Food and Drug Administration.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD03763-09-3
A. 5653--B 2
1 (d) For the purposes of this section, the term "goods and services"
2 shall include [(a)] (i) consumer goods and services used, bought or
3 rendered primarily for personal, family or household purposes, [(b)]
4 (ii) essential medical supplies and services used for the care, cure,
5 mitigation, treatment or prevention of any illness or disease, and [(c)]
6 (iii) any other essential goods and services used to promote the health
7 or welfare of the public.
8 (e) This prohibition shall apply to all parties within the chain of
9 distribution, including any manufacturer, supplier, wholesaler, distrib-
10 utor or retail seller of goods or services or both sold by one party to
11 another when the product sold was located in the state prior to the
12 sale. [Goods] For the purposes of this subdivision, the term "goods and
13 services" shall also include any repairs made by any party within the
14 chain of distribution of goods on an emergency basis as a result of such
15 abnormal disruption of the market.
16 § 2. This act shall take effect immediately.
