HB 1347

1	A bill to be entitled
2	An act relating to prescription drug practices; providing
3	definitions; providing that a pharmacy benefits manager
4	owes a fiduciary duty to covered entities and individuals;
5	providing duties and responsibilities of a pharmacy
6	benefits manager; providing criteria for dispersing
7	substitute prescription drugs; requiring a pharmacy
8	benefits manager to pass on certain payments to covered
9	entities or individuals; restricting a pharmacy benefits
10	manager from contracting in a manner inconsistent with
11	this act; providing that any agreement to waive the
12	provisions of this act is against public policy; providing
13	that a violation of this act is a violation of the Florida
14	Deceptive and Unfair Trade Practices Act; authorizing
15	private civil actions and civil action by the Attorney
16	General; providing for injunctive relief, civil penalties,
17	costs, expert fees, and attorney fees; providing for
18	dispensation of Canadian prescription drugs; providing
19	criteria for such dispensation; providing for purchase of
20	Canadian prescription medicines; providing definitions;
21	requiring that certain medications be purchased at a
22	certain rate; exempting pharmacy benefits managers from
23	certain requirements and actions for certain
24	dispensations; providing an effective date.
25
26	Be It Enacted by the Legislature of the State of Florida:
27
28	Section 1.  Prescription drug practices.--
29	(1)  As used in this section:
30	(a)  "Covered entity" means a nonprofit hospital, medical
31	service organization, insurer, health coverage plan, or health
32	maintenance organization licensed in this state; a health
33	program administered by the Department of Health in the capacity
34	of provider of health coverage; or an employer, labor union, or
35	other group of persons organized in this state that provides
36	health coverage to covered individuals who are employed or
37	reside in this state. Covered entity does not include a health
38	plan that provides coverage only for accidental injury,
39	specified disease, hospital indemnity, Medicare supplement,
40	disability income, or other long-term care.
41	(b)  "Covered individual" means a member, participant,
42	enrollee, contract holder, policy holder, or beneficiary of a
43	covered entity who is provided health coverage by the covered
44	entity. Covered individual includes a dependent or other person
45	provided health coverage through a policy, contract, or plan for
46	a covered individual.
47	(c)  "Generic drug" means a chemically equivalent copy of a
48	brand-name drug with an expired patent.
49	(d)  "Labeler" means an entity or person that receives
50	prescription drugs from a manufacturer or wholesaler and
51	repackages those drugs for later retail sale and has a labeler
52	code from the United States Food and Drug Administration.
53	(e)  "Pharmacy benefits management" means the procurement
54	of prescription drugs at a negotiated rate for dispensation
55	within this state to covered individuals, the administration or
56	management of prescription drug benefits provided by a covered
57	entity for the benefit of covered individuals, or any of the
58	following services provided with regard to the administration of
59	pharmacy benefits:
60	1.  Mail service pharmacy.
61	2.  Claims processing, retail network management, and
62	payment of claims to pharmacies for prescription drugs dispensed
63	to covered individuals.
64	3.  Clinical formulary development and management services.
65	4.  Rebate contracting and administration.
66	5.  Patient compliance, therapeutic intervention, and
67	generic substitution programs.
68	6.  Disease management programs.
69	(f)  "Pharmacy benefits manager" means an entity that
70	performs pharmacy benefits management, including a person or
71	entity acting in a contractual or employment relationship.
72	(2)  A pharmacy benefits manager owes a fiduciary duty to
73	covered entities and individuals and shall discharge that duty
74	in accordance with the provisions of state and federal law. A
75	pharmacy benefits manager shall:
76	(a)  Perform duties with care, skill, prudence, and
77	diligence and in accordance with the standards of conduct
78	applicable to a fiduciary in an enterprise of a like character
79	and with like aims.
80	(b)  Discharge duties with respect to the covered entity
81	and covered individuals solely in the interests of the covered
82	individuals and for the primary purpose of providing benefits to
83	covered individuals and defraying reasonable expenses of
84	administering health plans.
85	(c)  Notify the covered entity in writing of any activity,
86	policy, or practice of the pharmacy benefits manager that
87	directly or indirectly presents any conflict of interest with
88	the duties imposed by this section.
89	(d)  Provide to a covered entity all financial and
90	utilization information requested by the covered entity relating
91	to the provision of benefits to covered individuals through that
92	covered entity and all financial and utilization information
93	relating to services to that covered entity. A pharmacy benefits
94	manager providing information under this paragraph shall comply
95	with all rules established pursuant to s. 465.017, Florida
96	Statutes, in handling such information. Information designated
97	as confidential by a pharmacy benefits manager and provided to a
98	covered entity under this paragraph may not be disclosed to any
99	person without the consent of the pharmacy benefits manager,
100	except that disclosure may be made in a court filing under the
101	Florida Deceptive and Unfair Trade Practices Act or when
102	authorized by that act or ordered by a court of this state for
103	good cause shown.
104	(e)  Transfer in full to the covered entity or covered
105	individuals any benefit or payment received in any form by the
106	pharmacy benefits manager as a result of the prescription drug
107	substitution.
108	(f)  Disclose to the covered entity all financial terms and
109	arrangements for remuneration of any kind that apply between the
110	pharmacy benefits manager and any prescription drug manufacturer
111	or labeler, including, without limitation, formulary management
112	and drug-switch programs, educational support, claims
113	processing, and pharmacy network fees that are charged from
114	retail pharmacies and data sales fees.
115	(3)  With regard to the dispensation of a substitute
116	prescription drug for a prescribed drug to a covered individual,
117	the pharmacy benefits manager:
118	(a)  May substitute a lower-priced generic drug for a
119	higher-priced prescribed drug.
120	(b)  May not substitute a higher-priced generic drug for a
121	lower-priced prescribed drug.
122	(c)  Shall consult with the prescribing health professional
123	or that person's authorized representative.
124	(d)  Shall disclose the costs of both drugs to the covered
125	individual and the covered entity and any benefit or payment
126	directly or indirectly accruing to the pharmacy benefits manager
127	as a result of the substitution.
128	(e)  Shall obtain the approval of the prescribing health
129	professional or that person's authorized representative for the
130	substitution.
131	(4)  A pharmacy benefits manager that derives any payment
132	or benefit for the dispensation of prescription drugs based on
133	volume of sales for certain prescription drugs or classes or
134	brands of drugs shall pass on that payment or benefit, in full,
135	to the covered entity or covered individuals.
136	(5)  A pharmacy benefits manager may not, in a contract
137	with a covered entity, prescription drug manufacturer, or
138	labeler, accept or agree to an obligation that is inconsistent
139	with the fiduciary duties imposed by state or federal law.
140	(6)  Any agreement to waive the provisions of this section
141	is against public policy and is void.
142	(7)  A violation of this section is a violation of the
143	Florida Deceptive and Unfair Trade Practices Act. Compliance
144	with this section may be enforced through a private civil action
145	or a civil action by the Attorney General.
146	(a)  A covered entity, covered individual, or other person
147	injured as a result of a violation of this section is eligible
148	to bring a private civil action pursuant to the Florida
149	Deceptive and Unfair Trade Practices Act.
150	(b)  A civil action by the Attorney General pursuant to
151	this section is subject to the provisions of the Florida
152	Deceptive and Unfair Trade Practices Act. Each violation of this
153	section is a separate civil violation for which the Attorney
154	General may obtain, in addition to other remedies, injunctive
155	relief and a fine in an amount not to exceed $10,000 per
156	violation, plus the costs of suit, including necessary and
157	reasonable investigative costs, reasonable expert fees, and
158	reasonable attorney's fees.
159	Section 2.  Dispensing of Canadian prescriptions.--
160	Notwithstanding any other provision of law, a pharmacist
161	licensed in this state shall be permitted to dispense, sell,
162	market, or deliver a prescription that was originally dispensed
163	by a Canadian pharmacy, or otherwise legally imported from
164	Canada, provided that:
165	(1)  The pharmacist has reason to believe that the
166	prescription for such medication is valid.
167	(2)  Such medication is eligible for importation from
168	Canada pursuant to applicable federal law.
169	(3)  The pharmacist does not believe that the medication is
170	counterfeit.
171	Section 3.  Purchase of Canadian medications.--
172	(1)  As used in this section, the term:
173	(a)  "Canadian lower cost alternative" means any medication
174	that:
175	1.  Has been certified by the United States Department of
176	Health and Human Services or its designee as eligible for
177	importation from Canada pursuant to federal law.
178	2.  Is offered for sale by a Canadian drug wholesaler at a
179	price lower in amount than the average wholesale price of such
180	medication in the United States.
181	(b)  "Lowest Canadian cost alternative" means the amount of
182	the lowest price at which a Canadian lower-cost alternative is
183	offered for sale by any drug wholesaler.
184	(2)  Any medication the cost of which is reimbursed or
185	financed in whole or in part by state revenues shall be
186	purchased at a rate not higher than the lowest Canadian cost
187	alternative, if any.
188	(3)  A pharmacy benefits manager shall be exempt from all
189	of the mandatory requirements and obligations, as well as from
190	the civil enforcement provisions, set forth in this act for all
191	medication that is dispensed to a covered individual if such
192	medication meets the definition of a lowest Canadian cost
193	alternative for purposes of this section.
194	Section 4.  This act shall take effect July 1, 2004.

CODING: Words stricken are deletions; words underlined are additions.