2018 -- H 7706

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LC004678

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2018

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A N   A C T

RELATING TO BUSINESSES AND PROFESSIONS - PRESCRIPTION DRUG SALES -

REPRESENTATIVE DISCLOSURE ACT

     Introduced By: Representatives Edwards, Kennedy, Newberry, Canario, and Shekarchi

     Date Introduced: February 28, 2018

     Referred To: House Health, Education & Welfare

     It is enacted by the General Assembly as follows:

     SECTION 1. Legislative findings and declaration of purpose. The general assembly

hereby finds and declares that:

     (1) Containing health care costs requires containing prescription drug costs. The

costs of prescription drugs have been increasing dramatically. In order to contain prescription

drug costs, it is essential to understand the drivers of those costs, including increases in

prescriptions and changes in prescription patterns from low-cost to high-cost drugs.

     (2) Drug companies employ pharmaceutical sales representatives to increase sales by

persuading providers of health care to prescribe certain drugs. Sales representatives may

provide education to the provider of health care, but often also include inducements in the

form of gifts and drug samples.

     (3) Drug sales representatives often have access to physician prescription tracking

data.

     (4) The state has an interest in requiring disclosures and regulating the practice of

drug sales representatives.

     SECTION 2. Title 5 of the General Laws entitled "BUSINESSES AND PROFESSIONS"

is hereby amended by adding thereto the following chapter:

CHAPTER 19.3

THE PRESCRIPTION DRUG SALES REPRESENTATIVE DISCLOSURE ACT

     5-19.3-1. Short title.

     This chapter shall be known and may be cited as the "The Prescription Drug Sales

Representative Disclosure Act."

     5-19.3-2. Definitions.

     As used in this chapter, the following words and terms shall have the following meaning:

     (1) "Department" means the department of business regulation.

     (2) "Director" means the director of the department of business regulation or their

designee.

     (3) "Manufacturer" means a pharmaceutical, biological product, or medical device

manufacturer or any other person who is engaged in the production, preparation, propagation,

compounding, processing, marketing, packaging, repacking, distributing, or labeling of

prescribed products. The term does not include a wholesale distributor of biological products, a

retailer, or a pharmacist. The term also does not include a manufacturer whose only prescribed

products are classified as Class I by the U.S. Food and Drug Administration, are exempt from

pre-market notification under § 510(k) (21 U.S.C. 360 § 510 (k)) of the Federal Food, Drug and

Cosmetic Act, and are sold over the counter without a prescription.

     (4) "Medical facility" means any freestanding emergency-care facility, health care

facility, physician or podiatry ambulatory-surgery center, or other similar entity licensed by the

state.

     (5) "Pharmaceutical sales representative" means a person who markets prescription drugs

to providers of health care licensed, certified or registered in this state, pharmacies or employees

thereof, operators or employees of medical facilities or persons licensed or certified by the state.

     (6) "Prescription drug" means a drug as defined in 21 U.S.C. § 321.

     (7) "Provider of health care" means any person licensed in this state to administer or

prescribe a prescription drug.

     5-19.3-3. Pharmaceutical manufacturer and sales representative registration,

disclosure, and transparency report.

     (a) A manufacturer of a prescription drug shall provide to the department a list of each

pharmaceutical sales representative who markets prescription drugs on behalf of the manufacturer

to providers of health care in this state, pharmacies or employees thereof, or operators or

employees of medical facilities or persons licensed in this state.

     (1) The manufacturer shall inform the department by any means acceptable to the

department of a change in the manufacturer's list within thirty (30) days of the change. Failure to

timely inform the department of a change may result in a penalty to be determined by the

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department.

     (2) The manufacturer shall refile or update the list annually.

     (b) The department shall provide electronic access to the most recent list provided by

each manufacturer pursuant to subsection (a) of this section to each provider of health care

licensed, certified or registered in this state, operator of a pharmacy, and operator of a medical

facility, or person licensed or certified under the provisions of title 5 for the purposes of ensuring

compliance with the requirements of subsection (c) of this section. The department shall also

provide electronic access to the information to the department of health and public access via the

department's website. This subsection must not be construed to impose any duty on a provider of

health care, operator of a pharmacy, or operator of a medical facility or person licensed or

certified under the provisions of title 5 to ensure such compliance.

     (c) A person who is not included on a current list submitted pursuant to subsection (a) of

this section shall not market prescription drugs on behalf of a manufacturer to any provider of

health care licensed, certified or registered in this state, pharmacy or employee thereof, operator

or employee of a medical facility or person licensed or certified under the provisions of title 5.

     (d) On or before March 1 of each year, each person who was included on a list of

pharmaceutical sales representatives submitted pursuant to subsection (a) of this section at any

time during the immediately preceding calendar year shall submit to the department a report,

which must include, for the immediately preceding calendar year:

     (1) A list of providers of health care, pharmacies and employees thereof, and operators

and employees of medical facilities and persons licensed or certified under the provisions of title

5 to whom the pharmaceutical sales representative provided:

     (i) Any type of compensation, gift, or thing of value, with a value that exceeds ten dollars

($10.00); or

     (ii) Total compensation, gift, or thing of value, with a value that exceeds one hundred

dollars ($100) in aggregate; and

     (2) The name and manufacturer of each prescription drug for which the pharmaceutical

sales representative provided a free sample to a provider of health care licensed, certified or

registered in this state, pharmacy or employee thereof, or operator or employee of a medical

facility or person licensed or certified under the provisions of title 5.

     (e) The department shall analyze annually the information submitted pursuant to

subsection (d) of this section and compile a report on the activities of pharmaceutical sales

representatives in this state. On or before June 1 of each year, the department shall:

     (i) Post the report on the website maintained by the department; and

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     (ii) Submit the report to the governor, the director of the department of health, the

commissioner of the office of health insurance, the speaker of the house and the senate president.

     5-19.3-4. Fees and penalties.

     (a) A fee in the amount of fifty-five dollars ($55.00) annually shall be charged by the

director from each manufacturer, per each pharmaceutical sales representative listed by the

manufacturer. All revenue collected pursuant to this chapter shall be deposited as restricted

receipts available to the department as described in § 42-14-9.

     (b) The attorney general may bring an action in the civil division of the superior court,

Providence County for injunctive relief, costs, and attorneys' fees, and to impose, on a

manufacturer that fails to provide the information required by this chapter, a civil penalty of no

more than ten thousand dollars ($10,000) per violation. Each unlawful failure to provide

information shall constitute a separate violation. In any action brought pursuant to this section,

the attorney general shall have the same authority to investigate and to obtain remedies as if the

action were brought under the deceptive trade practices act, chapter 13.1 of title 6.

     SECTION 3. This act shall take effect on January 1, 2019.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO BUSINESSES AND PROFESSIONS - PRESCRIPTION DRUG SALES -

REPRESENTATIVE DISCLOSURE ACT

***

     This act would require prescription drug manufacturers to file a detailed, updated list of

each pharmaceutical sales representative and to pay an annual fee for each name listed with the

department of business regulation. Failure to comply would result in civil penalties.

     This act would take effect on January 1, 2019.

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