Full Text of Proposed Law
Be it Enacted by the People
of the State of Ohio that the
following chapter and section
are added to Title I of the
Revised Code.
Chapter 194: Drug Price
Relief
Section 194.01
(A) Title.
This Act shall be known as
"
The Ohio Drug Price Relief
Act" (the "Act").
(B) Findings and
Declarations.
The People of the State of Ohio
hereby find and declare all of
the following:
(1) Prescription drug costs
have been, and continue
to be, one of the greatest
drivers of rising health care
costs in Ohio.
(2) Nationally, prescription
drug spending increased
more than 800 percent
between 1990 and 2013,
making it one of the fastest
growing segments of health
care.
(3) Spending on specialty
medications, such as those
used to treat HIV/AIDS,
Hepatitis C, and cancers,
are rising faster than other
types of medications. In
2014 alone, total spending
on specialty medications
increased by more than 23
percent.
(4) The pharmaceutical
industry's practice of
charging inflated drug
prices has resulted in
pharmaceutical company
profits exceeding those of
even the oil and investment
banking industries.
(5) Inflated drug pricing has
led to drug companies
lavishing excessive pay on
their executives.
(6) Excessively priced
drugs continue to be
an unnecessary burden
on Ohio taxpayers that
ultimately results in cuts
to health care services and
providers for people in
need.
(7) Although Ohio has
engaged in efforts to
reduce prescription drug
costs through rebates, drug
manufacturers are still able
to charge the State more
than other government
payers for the same
medications, resulting in
a dramatic imbalance that
must be rectified.
(8) If Ohio is able to pay the
same prices for prescription
drugs as the amounts
paid by the United States
Department of Veterans
Affairs, it would result
in significant savings to
Ohio and its taxpayers.
This Act is necessary and
appropriate to address these
public concerns.
(C) Purposes and Intent.
The People of the State of Ohio
hereby declare the following
purposes and intent in enacting
this Act:
(1) To enable the State of Ohio
to pay the same prices
for prescription drugs
as the prices paid by the
United States Department
of Veterans Affairs, thus
rectifying the imbalance
among government payers.
(2) To enable significant cost
savings to Ohio and its
taxpayers for prescription
drugs, thus helping to stem
the tide of rising health
care costs in Ohio.
(3) To provide for the Act's
proper legal defense should
it be adopted and thereafter
challenged in court.
(D) Drug Pricing.
(1) Notwithstanding any
other provision of law
and insofar as may be
permissible under federal
law, neither the State
of Ohio, nor any state
department, agency or
other state entity, including,
but not limited to, the Ohio
Department of Aging,
the Ohio Department
of Health, the Ohio
Department of Insurance,
the Ohio Department of
Jobs and Family Services,
and the Ohio Department
of Medicaid, shall enter
into any agreement with
the manufacturer of any
drug for the purchase
of a prescribed drug or
agree to pay, directly or
indirectly, for a prescribed
drug, unless the net cost
of the drug, inclusive of
cash discounts, free goods,
volume discounts, rebates,
or any other discounts or
credits, as determined by
the purchasing department,
agency or entity, is the
same as or less than the
lowest price paid for the
same drug by the United
States Department of
Veterans Affairs.
(2) The price ceiling described
in subsection (1) above also
shall apply to all programs
where the State of Ohio
or any state department,
agency or other state entity
is the ultimate payer for
the drug, even if it did not
purchase the drug directly.
This includes, but is not
limited to, the Ohio Best
Rx Program and the Ohio
HIV Drug Assistance
Program. In addition to
agreements for any cash
discounts, free goods,
volume discounts, rebates,
or any other discounts or
credits already in place
for these programs, the
responsible department,
agency or entity shall enter
into additional agreements
with drug manufacturers
for further price reductions
so that the net cost of the
drug, as determined by the
purchasing department,
agency or entity, is the
same as or less than the
lowest price paid for the
same drug by the United
States Department of
Veterans Affairs.
(3) All state departments,
agencies and other state
entities that enter into one or
more agreements with the
manufacturer of any drug for
the purchase of prescribed
drugs or agreement to
pay directly or indirectly
for prescribed drugs shall
implement this section no
later than July 1, 2017.
(4) Each such department,
agency or other state entity,
may adopt administrative
rules to implement the
provisions of this section
and may seek any waivers
of federal law, rule, or
regulation necessary to
implement the provisions of
this section.
(5) The General Assembly
shall enact any additional
laws and the Governor
shall take any additional
actions required to
promptly carry out the
provisions of this section.
(E) Liberal Construction.
This Act shall be liberally
construed to effectuate its
purpose.
(F) Severability.
If any provision of this Act, or
part thereof, or the applicability
of any provision or part to any
person or circumstances, is for
any reason held to be invalid or
unconstitutional, the remaining
provisions and parts shall not
be affected, but shall remain
in full force and effect, and
to this end the provisions and
parts of this Act are severable.
If this Act and another law are
approved by the voters at the
same election with one or more
conflicting provisions and this
Act receives fewer votes, the
non-conflicting provisions of
this Act shall go into effect.
(G) Legal Defense.
If any provision of this Act is
challenged in court, it shall
be defended by the Attorney
General of Ohio. The People
of Ohio, by enacting this
Act, hereby declare that the
committee of individuals
responsible for the circulation
of the petition proposing
this Act ("the Proponents")
have a direct and personal
stake in defending this Act
from constitutional or other
challenges. In the event of a
challenge, any one or more of
the Act's Proponents shall be
entitled to assert their direct and
personal stake by defending the
Act's validity in any court of
law, including on appeal. The
Proponents shall be indemnified
by the State of Ohio for their
reasonable attorney's fees and
expenses incurred in defending
the validity of the challenged
Act. In the event that the Act
or any of its provisions or parts
are held by a court of law, after
exhaustion of any appeals, to
be unenforceable as being in
conflict with other statutory or
constitutional provisions, the
Proponents shall be jointly and
severally liable to pay a civil
fine of $10,000 to the State of
Ohio, but shall have no other
personal liability to any person
or entity.
