§ 272 — Preferred drug program

§ 272. Preferred drug program. 1. There is hereby established a\npreferred drug program to promote access to the most effective\nprescription drugs while reducing the cost of prescription drugs for\npersons in state public health plans.\n 2. When a prescriber prescribes a non-preferred drug, state public\nhealth plan reimbursement shall be denied unless prior authorization is\nobtained, unless no prior authorization is required under this article.\n 3. The commissioner shall establish performance standards for the\nprogram that, at a minimum, ensure that the preferred drug program and\nthe clinical drug review program provide sufficient technical support\nand timely responses to consumers, prescribers and pharmacists.\n 4. Notwithstanding any other provision of law to the contrary, no\npreferred drug program or prior authorization requirement for\nprescription drugs, except as created by this article, paragraph (a-1)\nor (a-2) of subdivision four of section three hundred sixty-five-a of\nthe social services law, paragraph (g) of subdivision two of section\nthree hundred sixty-five-a of the social services law, subdivision one\nof section two hundred forty-one of the elder law and shall apply to the\nstate public health plans.\n 5. The drug utilization review board shall consider and make\nrecommendations to the commissioner for the adoption of a preferred drug\nprogram. (a) In developing the preferred drug program, the board shall,\nwithout limitation: (i) identify therapeutic classes or drugs to be\nincluded in the preferred drug program; (ii) identify preferred drugs in\neach of the chosen therapeutic classes; (iii) evaluate the clinical\neffectiveness and safety of drugs considering the latest peer-reviewed\nresearch and may consider studies submitted to the federal food and drug\nadministration in connection with its drug approval system; (iv)\nconsider the potential impact on patient care and the potential fiscal\nimpact that may result from making such a therapeutic class subject to\nprior authorization; and (v) consider the potential impact of the\npreferred drug program on the health of special populations such as\nchildren, the elderly, the chronically ill, persons with HIV/AIDS and\npersons with mental health conditions.\n (b) In developing the preferred drug program, the board may consider\npreferred drug programs or evidence based research operated or conducted\nby or for other state governments, the federal government, or\nmulti-state coalitions. Notwithstanding any inconsistent provision of\nsection one hundred twelve or article eleven of the state finance law or\nsection one hundred forty-two of the economic development law or any\nother law, the department may enter into contractual agreements with the\nOregon Health and Science University Drug Effectiveness Review Project\nto provide technical and clinical support to the board and the\ndepartment in researching and recommending drugs to be placed on the\npreferred drug list.\n (c) The board shall from time to time review all therapeutic classes\nincluded in the preferred drug program, and may recommend that the\ncommissioner add or delete drugs or classes of drugs to or from the\npreferred drug program, subject to this subdivision.\n (d) The board shall establish procedures to promptly review\nprescription drugs newly approved by the federal food and drug\nadministration.\n 6. The board shall recommend a procedure and criteria for the approval\nof non-preferred drugs as part of the prior authorization process. In\ndeveloping these criteria, the board shall include consideration of the\nfollowing:\n (a) the preferred drug has been tried by the patient and has failed to\nproduce the desired health outcomes;\n (b) the patient has tried the preferred drug and has experienced\nunacceptable side effects;\n (c) the patient has been stabilized on a non-preferred drug and\ntransition to the preferred drug would be medically contraindicated; and\n (d) other clinical indications for the use of the non-preferred drug,\nwhich shall include consideration of the medical needs of special\npopulations, including children, the elderly, the chronically ill,\npersons with mental health conditions, and persons affected by HIV/AIDS.\n 7. The commissioner shall provide thirty days public notice on the\ndepartment's website prior to any meeting of the board to develop\nrecommendations concerning the preferred drug program and any proposed\neliminations to the list of drugs reimbursable under subdivision four of\nsection three hundred sixty-five-a of the social services law. Such\nnotice regarding meetings of the board shall include a description of\nthe proposed therapeutic class to be reviewed, a listing of drug\nproducts in the therapeutic class, and the proposals to be considered by\nthe board. The board shall allow interested parties a reasonable\nopportunity to make an oral presentation to the board related to the\nprior authorization of the therapeutic class to be reviewed. The board\nshall consider any information provided by any interested party,\nincluding, but not limited to, prescribers, dispensers, patients,\nconsumers and manufacturers of the drug in developing their\nrecommendations.\n 8. The commissioner shall provide notice of any recommendations\ndeveloped by the board regarding the preferred drug program or\nelimination to the list of drugs reimbursable under subdivision four of\nsection three hundred sixty-five-a of the social services law, at least\nfive days before any final determination by the commissioner, by making\nsuch information available on the department's website. Such public\nnotice may include: a summary of the deliberations of the board; a\nsummary of the positions of those making public comments at meetings of\nthe board; the response of the board to those comments, if any; and the\nfindings and recommendations of the board.\n 9. Within ten days of a final determination regarding the preferred\ndrug program or elimination to the list of drugs reimbursable under\nsubdivision four of section three hundred sixty-five-a of the social\nservices law, the commissioner shall provide public notice on the\ndepartment's website of such determinations, including: the nature of\nthe determination; and analysis of the impact of the commissioner's\ndetermination on state public health plan populations and providers; and\nthe projected fiscal impact to the state public health plan programs of\nthe commissioner's determination.\n 10. The commissioner shall adopt a preferred drug program and\namendments after considering the recommendations from the board and any\ncomments received from prescribers, dispensers, patients, consumers and\nmanufacturers of the drug.\n (a) The preferred drug list in any therapeutic class included in the\npreferred drug program shall be developed based initially on an\nevaluation of the clinical effectiveness, safety and patient outcomes,\nfollowed by consideration of the cost-effectiveness of the drugs.\n (b) In each therapeutic class included in the preferred drug program,\nthe board shall determine whether there is one drug which is\nsignificantly more clinically effective and safe, and that drug shall be\nincluded on the preferred drug list without consideration of cost. If,\namong two or more drugs in a therapeutic class, the difference in\nclinical effectiveness and safety is not clinically significant, then\ncost effectiveness (including price and supplemental rebates) may also\nbe considered in determining which drug or drugs shall be included on\nthe preferred drug list.\n (c) In addition to drugs selected under paragraph (b) of this\nsubdivision, any prescription drug in the therapeutic class, whose cost\nto the state public health plans (including net price and supplemental\nrebates) is equal to or less than the cost of another drug in the\ntherapeutic class that is on the preferred drug list under paragraph (b)\nof this subdivision, may be selected to be on the preferred drug list,\nbased on clinical effectiveness, safety and cost-effectiveness.\n (d) Notwithstanding any provision of this section to the contrary, the\ncommissioner may designate therapeutic classes of drugs, including\nclasses with only one drug, as all preferred prior to any review that\nmay be conducted by the board pursuant to this section.\n 11. (a) The commissioner shall provide an opportunity for\npharmaceutical manufacturers to provide supplemental rebates to the\nstate public health plans for drugs within a therapeutic class; such\nsupplemental rebates shall be taken into consideration by the board and\nthe commissioner in determining the cost-effectiveness of drugs within a\ntherapeutic class under the state public health plans.\n (b) The commissioner may designate a pharmaceutical manufacturer as\none with whom the commissioner is negotiating or has negotiated a\nmanufacturer agreement, and all of the drugs it manufactures or markets\nshall be included in the preferred drug program. The commissioner may\nnegotiate directly with a pharmaceutical manufacturer for rebates\nrelating to any or all of the drugs it manufactures or markets. A\nmanufacturer agreement shall designate any or all of the drugs\nmanufactured or marketed by the pharmaceutical manufacturer as being\npreferred or non preferred drugs. When a pharmaceutical manufacturer has\nbeen designated by the commissioner under this paragraph but the\ncommissioner has not reached a manufacturer agreement with the\npharmaceutical manufacturer, then the commissioner may designate some or\nall of the drugs manufactured or marketed by the pharmaceutical\nmanufacturer as non preferred drugs. However, notwithstanding this\nparagraph, any drug that is selected to be on the preferred drug list\nunder paragraph (b) of subdivision ten of this section on grounds that\nit is significantly more clinically effective and safer than other drugs\nin its therapeutic class shall be a preferred drug.\n (c) Supplemental rebates under this subdivision shall be in addition\nto those required by applicable federal law and subdivision seven of\nsection three hundred sixty-seven-a of the social services law. In order\nto be considered in connection with the preferred drug program, such\nsupplemental rebates shall apply to the drug products dispensed under\nthe Medicaid program and the EPIC program. The commissioner is\nprohibited from approving alternative rebate demonstrations, value added\nprograms or guaranteed savings from other program benefits as a\nsubstitution for supplemental rebates.\n 13. The commissioner may implement all or a portion of the preferred\ndrug program through contracts with administrators with expertise in\nmanagement of pharmacy services, subject to applicable laws.\n 14. For a period of eighteen months, commencing with the date of\nenactment of this article, and without regard to the preferred drug\nprogram or the clinical drug review program requirements of this\narticle, the commissioner is authorized to implement, or continue, a\nprior authorization requirement for a drug which may not be dispensed\nwithout a prescription as required by section sixty-eight hundred ten of\nthe education law, for which there is a non-prescription version within\nthe same drug class, or for which there is a comparable non-prescription\nversion of the same drug. Any such prior authorization requirement shall\nbe implemented in a manner that is consistent with the process employed\nby the commissioner for such authorizations as of one day prior to the\ndate of enactment of this article. At the conclusion of the eighteen\nmonth period, any such drug or drug class shall be subject to the\npreferred drug program requirements of this article; provided, however,\nthat the commissioner is authorized to immediately subject any such drug\nto prior authorization without regard to the provisions of subdivisions\nfive through eleven of this section.\n