S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   10327
 
                           I N  A S S E M B L Y
 
                               May 17, 2024
                                ___________
 
 Introduced by COMMITTEE ON RULES -- (at request of M. of A. McDonald) --
   read once and referred to the Committee on Health
 
 AN  ACT to amend the public health law, in relation to payments by phar-
   macy benefit managers to in-network pharmacies
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1. Subdivision 1 of section 280-a of the public health law is
 amended by adding two new paragraphs (j) and (k) read as follows:
   (J) "PHARMACY ACQUISITION COST RATE" MEANS THE COST PAID BY AN IN-NET-
 WORK PHARMACY TO ACQUIRE GENERIC, BRAND NAME DRUGS OR BIOLOGIC  PRODUCTS
 PURSUANT TO COST INVOICES FROM A MANUFACTURER OR A WHOLESALER.
   (K)  "NATIONAL AVERAGE DRUG ACQUISITION COST" MEANS THE MONTHLY SURVEY
 OF RETAIL PHARMACIES CONDUCTED BY THE FEDERAL CENTERS FOR  MEDICARE  AND
 MEDICAID  SERVICES (CMS) TO DETERMINE AVERAGE ACQUISITION COST FOR MEDI-
 CAID COVERED OUTPATIENT DRUGS.
   § 2. Subdivision 3 of section 280-a  of  the  public  health  law,  as
 amended  by  chapter  128  of  the  laws  of 2022, is amended to read as
 follows:
   3. Prescriptions. (A) A pharmacy benefit manager may not substitute or
 cause the substituting of one prescription drug for another in  dispens-
 ing  a  prescription,  or  alter or cause the altering of the terms of a
 prescription, except with the approval of the prescriber or as explicit-
 ly required or permitted by law, including regulations of the department
 of financial services or the department of  health.  The  superintendent
 and  commissioner,  in  coordination  with each other, are authorized to
 promulgate regulations to determine when  substitution  of  prescription
 drugs may be required or permitted.
   (B)  TO  THE  EXTENT  PERMITTED  UNDER FEDERAL LAW, A PHARMACY BENEFIT
 MANAGER SHALL PAY AN IN-NETWORK PHARMACY  AT  MINIMUM  AT  THE  NATIONAL
 AVERAGE  DRUG  ACQUISITION COST (NADAC) RATE OR AT THE PHARMACY ACQUISI-
 TION COST RATE IF GREATER OR THERE IS NOT A NADAC RATE, PLUS  A  PROFES-
 SIONAL  DISPENSING  FEE  THAT IS AT MINIMUM THE  PROFESSIONAL DISPENSING
 FEE PAID UNDER THE STATE MEDICAL ASSISTANCE PROGRAM.    FOR  BRAND  NAME
 MEDICATIONS  AND BIOLOGIC PRODUCTS THAT REQUIRE SPECIAL PACKAGING, SHIP-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD15487-03-4
 A. 10327                            2
 
 PING OR OTHER COSTS TO  BE INCURRED BY THE  PHARMACY FOR THE  DISPENSING
 PROCESS THAT IS GREATER THAN THE PROFESSIONAL DISPENSING FEE PAID BY THE
 STATE  MEDICAL ASSISTANCE PROGRAM, IN-NETWORK PHARMACIES SHALL BE PAID A
 PROFESSIONAL  DISPENSING  FEE    FOR THESE COSTS TO ENSURE AN IN-NETWORK
 PHARMACY IS NOT PAID LESS THAN ITS COST TO ACQUIRE AND DISPENSE  MEDICA-
 TIONS.
   § 3. The opening paragraph of subdivision 4 of section  280-a  of  the
 public  health  law,  as  added  by  chapter 828 of the laws of 2021, is
 amended to read as follows:
   A pharmacy benefit manager shall, with respect to contracts between  a
 pharmacy  benefit  manager  and a pharmacy or, alternatively, a pharmacy
 benefit manager and a pharmacy's contracting agent, such as  a  pharmacy
 services  administrative  organization,  include a reasonable process to
 appeal, investigate and resolve disputes regarding multi-source generic,
 BRAND NAME AND BIOLOGIC PRODUCT drug pricing. The appeals process  shall
 include the following provisions:
   § 4. This act shall take effect immediately.