STAND. COM. REP. NO. 3135

Honolulu, Hawaii

RE: S.B. No. 2276

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2020

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred S.B. No. 2276, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO PRESCRIPTION DRUGS,"

begs leave to report as follows:

The purpose and intent of this measure is to:

(1) Require drug manufacturers to notify the insurance commissioner, prescription drug benefit plans, and pharmacy benefit managers if a proposed increase in the wholesale price of certain drugs would result in an unspecified percent age or more price increase over a two-year period;

(2) Require the drug manufacturer to identify and report to the insurance commissioner information on certain drugs whose wholesale acquisition cost increases by a certain amount during a specified time frame; and

(3) Require the insurance commissioner to post price information of certain drugs on the Department of Commerce and Consumer Affair's website.

Your Committee received testimony in opposition to this measure from the Pharmaceutical Research and Manufacturers of America. Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs, Insurance Division; Office of Information Practices; and the Hawaii Employer-Union Health Benefits Trust Fund.

Your Committee finds that one of the greatest threats to the affordability of health care coverage is the pharmaceutical industry's pricing of new and existing medications. This measure would require pharmaceutical manufacturers to report certain pricing information when implementing major price increases. This measure also provides assessable fines for a violation of the reporting requirements by drug manufacturers.

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2276, S.D. 1, and recommends that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committee on Judiciary,

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KARL RHOADS, Chair