Transparency Update: Oregon

03.29.18 | By John Thorpe

Oregon Governor Kate Brown signed a transparency law (HB 4005) into effect on March 13th, 2018, requiring the reporting of information related to prescription drug pricing, as well as R&D and marketing costs. HB 4005 follows in the footsteps of state transparency laws in California and Nevada focused on drug pricing.

If a prescription drug has a price of $100 or more for a one-month supply (or for a course of treatment less than one month) and that drug had a net price increase of 10% or more over the previous calendar year, manufacturers must report, for that drug, the following information:

  • The name and price of the prescription drug and the cumulative percentage price increase during the previous calendar year
  • The length of time the prescription drug has been on the market
  • The factors that contributed to the price increase
  • The name of any generic version of the prescription drug available on the market
  • The research and development costs associated with the prescription drug that were paid using public funds
  • The direct costs incurred by the manufacturer
    • To manufacture the prescription drug
    • To market the prescription drug
    • To distribute the prescription drug and
    • For ongoing safety and effectiveness research associated with the prescription drug
  • The total sales revenue for the prescription drug during the previous calendar year
  • The manufacturer’s profit attributable to the prescription drug during the previous calendar year
  • The introductory price of the prescription drug when it was approved for marketing by the United States Food and Drug Administration and the cumulative yearly increase, by calendar year, in the price of the prescription drug during the previous five years
  • The 10 highest prices paid for the prescription drug during the previous calendar year in any country other than the United States and
  • The documentation necessary to support the information reported under this subsection.

Reports are due to the Oregon Department of Consumer and Business Services (ODCBS) on July 1, 2019 and by March 15th of every year thereafter.  Further, additional information must also be provided (as specified in HB 4005) to ODCBS for prescription drugs that meet the criteria stated in the second paragraph of this article related to:

  • Intended price increases (if a manufacturer intends to increase the price of the prescription drug, a report must be provided to ODCBS 60 days prior to the planned priced increase)
  • Patient assistance programs

After March 15th, 2019, prescription drug manufacturers must also provide the following information if the manufacturer introduces a new drug for sale in the U.S. market that exceeds the Medicare Part D program threshold for specialty drugs ($670 in 2018):

  • A description of the marketing used in the introduction of the new prescription drug
  • The methodology used to establish the price of the new prescription drug
  • Whether the United States Food and Drug Administration granted the new prescription drug a breakthrough therapy designation or a priority review
  • If the new prescription drug was not developed by the manufacturer, the date of and the price paid for acquisition of the new prescription drug by the manufacturer
  • The manufacturer’s estimate of the average number of patients who will be prescribed the new prescription drug each month, and
  • The research and development costs associated with the new prescription drug that were paid using public funds.

This information is required to be reported within 30 days after the manufacturer introduces the new drug for sale.

HB 4005 includes civil penalties of up to $10,000 per day of violation, based on the severity of each violation.

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