Outside Section 48



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MassHealth Drug Pricing 2

SECTION 48.   Chapter 118E of the General Laws is hereby amended by inserting after section 12 the following section:-

Section 12A. (a) Notwithstanding any general or special law to the contrary and subject to required federal approvals, the executive office of health and human services may directly negotiate supplemental rebate agreements with manufacturers of prescribed drugs without regard to any otherwise applicable requirements set forth in 801 CMR 21.00 or any successor regulation, provided that such agreements maximize value to the commonwealth. Such agreements may be based on the value, efficacy, or outcomes of the drug.

(b) In the event a manufacturer of prescribed drugs and the executive office are unable to successfully conclude negotiations for a supplemental rebate agreement pursuant to subsection (a) and the drug that is the subject of the negotiations is projected to exceed a post-rebate cost per utilizer of $25,000 per year or a post-rebate aggregate annual cost to MassHealth of $10,000,000, the executive office may publicly post a proposed value for the drug on the website of the executive office and in a manner consistent with its obligations under federal law, and shall afford interested persons an opportunity to present data, views or arguments for a period of not less than 21 days, and, at the option of the secretary, hold a public hearing as to the proposed value of the drug. In establishing the proposed value of a drug, the executive office may consider factors including clinical efficacy and outcomes, public health value, prices paid by other developed nations, analyses by independent third parties and other appropriate measures of value. After consideration of the public comments or testimony received, the executive office shall make any necessary updates to the proposed value of the drug and post the final determined value of the drug on the website of the executive office and in a manner consistent with its obligations under federal law. The executive office may engage the manufacturer of the drug in further negotiations under subsection (a) at any point during this process, and shall, at minimum, solicit further negotiations with the drug manufacturer after posting the final determined value of the drug.

(c) In the event a manufacturer of prescribed drugs and the executive office are unable to successfully conclude negotiations for a supplemental rebate agreement pursuant to subsection (a) after the process set forth in subsection (b), the secretary may refer the drug manufacturer to the health policy commission for review under section 8A of chapter 6D.

(d) The executive office shall adopt any written policies, procedures or regulations that the secretary determines necessary to implement this section.
 
 

Summary:
This section allows MassHealth to negotiate supplemental rebate agreements directly with drug manufacturers, including value-based agreements, regardless of state procurement rules. It also provides MassHealth additional tools to encourage manufacturers to engage in good faith negotiations for supplemental rebate agreements, including a public process to determine the value of a drug and referral to the Health Policy Commission to determine if the manufacturer has priced the drug excessively.



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