Life Science Compliance Update

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June 01, 2017

Nevada Is Latest State to Enter Pharma Regulation


Democrats in Nevada’s state senate are posturing that they have passed one of the country’s strongest pharma transparency bills targeting diabetes drug prices. Senate Bill 265, approved mid-May, would force diabetes drug makers to disclose information on their insulin pricing, profits, costs, and more, and additionally, would require the state government to publish the information publicly on the internet.

The legislation would also require drug makers to announce price hikes and permit purchasers to file for partial reimbursement if a price increase exceeds the medical care component of the Consumer Price Index, or is above a “foreign price cap” that calculates drug prices outside of the United States.

As would be expected, PhRMA is opposed to the legislation, noting that, “We are continuing to educate lawmakers and Nevadans about the dangers of this legislation and the fact that it will not do anything to help Nevada patients access or afford their medicines.”

While Nevada’s proposal calls for increased transparency in insulin pricing, top players Sanofi and Novo Nordisk have pledged to limit their increases, while Eli Lilly has unveiled high-level pricing details showing a large discrepancy between its list price increases and realized gains. All three have recently signed payer-drugmaker partnerships aimed at getting their treatments at lower out-of-pocket costs.

Nevada is in the majority, with at least thirty other states also introducing laws taking on pharmaceutical pricing. This fits with the wave of criticism that has been leveled against industry (especially since the 2016 presidential election), and now even the United States Congress is weighing legislation regarding pharmaceutical pricing, including allowing Medicare price negotiations, importing products from Canada, and placing new restriction on industry.

Any companies that do not comply with the legislation can be penalized by the state.

Governor Sandoval’s Reaction

The day after this bill was passed by the legislature, Nevada Governor Brian Sandoval signed nineteen bills, though SB 265 was not one of them. However, similar to another state pricing bill, a price gouging bill in Maryland, it will likely become law unless Governor Sandoval vetoes the bill, as Nevada’s legislative process is similar – Sandoval can either (1) veto, (2) sign, or (3) do nothing.

As pointed out by our colleague Nicodemo Fiorentino, the original bill included a provision that required reps to be licensed before marketing. The enrolled version of the bill includes a provision that will require a manufacturer of prescription drugs to submit a list of each pharmaceutical sales representative marketing prescription drugs in the state, a requirement to update this list at least monthly, and to make certain annual disclosures on or before March 1st, among other things.

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