JUPITER, Fla. – Florida Gov. Ron DeSantis held a news conference Wednesday morning at Florida Atlantic University’s MacArthur Campus to sign the Prescription Drug Reform Act into law.
Proposed in January as a way to begin “reining in” pharmacy benefit managers, SB 1550 orders drug manufacturers by April 1 of each year to notify the Department of Business and Professional Regulation of any “reportable drug price increase” in the 12 months leading up to said review.
As defined in the bill, a “reportable drug price increase” is any increase over a year’s time of 15% or more of a drug’s wholesale acquisition cost as long as the wholesale cost is at least $100, or any cumulative increase of 30% or more of the drug’s wholesale acquisition cost over a period of three years leading up to the report.
While no significant update was given regarding the governor’s long-held intent to import cheaper prescription drugs from Canada, DeSantis characterized the Prescription Drug Reform Act as the result of the state’s search for any way to bring costs down, claiming the Biden administration is holding up the border plan.
“One of the things that we see is when you go to, like, your pharmacy, it’s not like the drug’s just there (and) you buy it, there’s middlemen that are involved in providing this and charging for it, they’re called pharmacy benefit managers and it’s a very opaque part of this process, but they make huge, huge amounts of money and really helped drive the cost of prescription drugs higher and higher,” DeSantis said. “...We see the prices going up, there’s a variety of reasons for that, PBMs are one part of it, there’s a lot of money being made, not a lot of value being returned to consumers and making it more difficult for our small businesses to operate. "
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The bill signing on Wednesday also codified provisions of Executive Order 22-164, signed by DeSantis in July 2022 to prohibit spread pricing and clawbacks in contracts with PBMs, weakening the leverage that DeSantis has said they have on the market.
“It ensures that no Florida-registered PBM can mandate a narrow network that only includes that company’s affiliated pharmacies, and it creates transparency in drug price hikes that help empower and inform consumers about cost increases. Drug manufacturers will also have to submit reports to the Department of Business and Professional Regulation of drug price increases, which the Agency for Healthcare Administration will publicly post on MyFloridaRx.com with regular updates,” said Jason Weida, secretary at the Agency for Health Care Administration.
Some of the bill’s other provisions include more requirements for PBMs applying for a DBPR-issued certificate of authority to act as an “administrator” as well as a requirement that PBMs secure that certificate by Jan. 1, 2024, or be subject to a $10,000 fine per violation per day.
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The governor this week has already held news conferences in Brevard County to sign three bills Monday, one allowing the death penalty for people who commit sexual batteries on children under 12, and another to sign legislation Tuesday meant to eliminate the consideration of ESG standards from government investment strategies, procurements, bond issuances and use of banks.
Also Monday, the Central Florida Tourism Oversight District board filed a lawsuit against Disney in state court, voting as well to defend itself in federal court against the lawsuit Disney filed against it the week prior on allegations DeSantis and the board violated the company’s constitutional rights in a “targeted campaign of government retaliation” over former CEO Robert Chapek’s criticism of the Parental Rights in Education Act.
Watch Wednesday’s news conference again in the video player below.
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