SB449 SD2.DOC

SECTION 1. The legislature finds that in 2006, New Hampshire enacted a law that prohibits the sale of doctor-specific prescription drug data that is widely used in pharmaceutical marketing. The New Hampshire law is intended to reduce state health care costs by eliminating the tool used by drug sales representatives in targeting sales of brand name drugs. By purchasing the data describing which doctors prescribe what drugs, pharmaceutical sales agents can more readily identify doctors who might be likely to prescribe their products and thus be receptive to their sales proposals. Of greater concern, however, is that drug companies can also use the information to identify doctors who do not write many prescriptions for their products, in order to step up their marketing efforts.

On November 18, 2008, the United States First Circuit Court of Appeals upheld the New Hampshire statute against a challenge to its validity. In its ruling, the United States Court of Appeals wrote, "The record contains substantial evidence that, in several instances, detailers [pharmaceutical sales representatives] armed with prescribing histories encourage the overzealous prescription of more costly brand-name drugs regardless of both the public health consequences and the probable outcome of a sensible cost/benefit analysis."

The purpose of this Act is to enact a patient prescription information confidentiality law prohibiting the sale of doctor-specific prescription drug data.

SECTION 2. Chapter 328, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§328- Prescription information; confidentiality; violation. (a) Records relating to prescription information containing patient-identifiable and prescriber-identifiable data shall not be licensed, transferred, used, or sold by any pharmacy benefits manager, insurance company, electronic transmission intermediary, pharmacy licensed under chapter 461, physician or osteopathic physician licensed under chapter 453, or other similar entity, for any commercial purpose, except for the limited purposes of:

(1) Pharmacy reimbursement;

(2) Formulary compliance;

(3) Care management;

(4) Utilization review by a health care provider, the patient's insurance provider, or third-party insurance provider, or the agent of either;

(5) Health care research; or

(6) As otherwise provided by law.

(b) For the purpose of this section, "pharmacy benefits manager" means a third party administrator of prescription drug benefit programs primarily responsible for processing and paying prescription drug claims, developing and maintaining a drug formulary, contracting with pharmacies, and negotiating discounts and rebates with drug manufacturers. Commercial purposes include advertising, marketing, promotion, or any activity that could be used to influence sales or market share of a pharmaceutical product, influence or evaluate the prescribing behavior of an individual health care professional, or evaluate the effectiveness of a professional pharmaceutical detailing sales force.

(1) The dispensing of prescription medications to a patient or to the patient's authorized representative;

(2) The transmission of prescription information between an authorized prescriber and a licensed pharmacy;

(3) The transfer of prescription information between licensed pharmacies;

(4) The transfer of prescription records that may occur in the event a pharmacy ownership is changed or transferred; or

(5) Care management educational communications provided to a patient about:

(A) The patient's health condition;

(B) Adherence to a prescribed course of therapy; or

(d) Nothing in this section shall prohibit the collection, use, transfer, or sale of patient and prescriber data that are not identifiable by zip code, geographic region, or medical specialty for commercial purposes.

(e) In addition to other remedies, a violation of this section is an unfair or deceptive act or practice within the meaning of section 480-2.

(f) The department of commerce and consumer affairs, shall initiate investigations and disciplinary action to enforce this section regarding any reports of activity that may violate this section.

(g) The department of commerce and consumer affairs, shall refer reports of any person or entity in violation of this section to the appropriate professional licensing or regulatory body for investigation and disciplinary action, including the suspension or revocation of the person or entity's license or permit to practice."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect on July 1, 2015.

THE SENATE	S.B. NO.	449
TWENTY-FIFTH LEGISLATURE, 2009		S.D. 2
STATE OF HAWAII