Prescription Drug Discount Prohibition

Section § 132000

This law states that drug manufacturers cannot offer discounts, vouchers, or other financial relief on prescription drugs if a cheaper generic alternative is available under a person's health insurance plan. This restriction aims to encourage the use of generic drugs, which are generally more affordable. An exception to this rule is allowed for branded drugs until a generic version has been on the market for three months.

(a) Except as provided in Section 132004, a person who manufactures a prescription drug shall not offer in the state a discount, repayment, product voucher, or other reduction in an individual’s out-of-pocket expenses associated with his or her health insurance, health care service plan, or other health coverage, including, but not limited to, a copayment, coinsurance, or deductible, for a prescription drug if a lower cost generic drug is covered under the individual’s health insurance, health care service plan, or other health coverage on a lower cost-sharing tier that is designated to be therapeutically equivalent as indicated by the United States Food and Drug Administration’s “Approved Drug Products with Therapeutic Equivalence Evaluations.”

(b) The prohibition in subdivision (a) shall not apply to a branded prescription drug, until the time that the first drug designated in the United States Food and Drug Administration’s “Approved Drug Products with Therapeutic Equivalence Evaluations” as therapeutically equivalent to that branded prescription drug has been nationally available for three calendar months.

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Section § 132002

This law says that drug manufacturers can't offer discounts or vouchers to patients in California for prescription drugs if those drugs have active ingredients that are available in lower-cost, non-prescription products, and there's no medical reason why the over-the-counter option shouldn't be used for treatment.

Except as provided in Section 132004, a person who manufactures a prescription drug shall not offer in the state a discount, repayment, product voucher, or other reduction in the individual’s out-of-pocket expenses associated with his or her health insurance, health care service plan, or other health coverage, including, but not limited to, a copayment, coinsurance, or deductible, for a prescription drug if the active ingredients of the drug are contained in products regulated by the federal Food and Drug Administration, are available without prescription at a lower cost, and are not otherwise contraindicated for treatment of the condition for which the prescription drug is approved.

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Section § 132004

This law outlines exceptions to certain prohibitions relating to prescription drug payments. It allows discounts or vouchers for drugs required under FDA Risk Evaluation if they help in proper drug use. It permits a single-tablet regimen for HIV/AIDS even if more tablets are equally effective, provided it aids adherence. It also allows branded drug discounts when an individual fulfills health plan requirements and when discounts are unrelated to insurance coverage. Rebates received by state agencies are also allowed.

The prohibitions in Sections 132000 and 132002 shall not apply to any of the following:

(a) A discount, repayment, product voucher, or other payment to a patient or another person on the patient’s behalf for a prescription drug required under a United States Food and Drug Administration Risk Evaluation and Mitigation Strategy for the purpose of monitoring or facilitating the use of that prescription drug in a manner consistent with the approved labeling of the prescription drug.

(b) A single-tablet drug regimen for treatment or prevention of human immunodeficiency virus (HIV) or acquired immune deficiency syndrome (AIDS) that is as effective as a multitablet regimen, unless, consistent with clinical guidelines and peer-reviewed scientific and medical literature, the multitablet regimen is clinically equally effective or more effective and is more likely to result in adherence to the drug regimen.

(c) The individual has completed any applicable step therapy or prior authorization requirements for the branded prescription drug as mandated by the individual’s health insurer, health care service plan, or other health coverage.

(d) A discount, repayment, product voucher, or other reduction in an individual’s out-of-pocket expenses is not associated with his or her health insurance, health care service plan, or other health coverage.

(e) Rebates received by a state agency.

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Section § 132006

This law allows drug manufacturers and patient assistance programs, funded by manufacturers, to give prescription drugs to patients for free, as long as neither the patient nor their insurance or health plan is charged.

This division does not prohibit an entity, including an entity that manufactures prescription drugs or a patient assistance program that is solely funded by one or more manufacturers, from offering a pharmaceutical product free of any cost, if the product is free of cost to both the patient and his or her health insurer, health care service plan, or other health coverage.

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Section § 132008

This law states that pharmacists can still substitute prescription drugs as per existing rules. It also allows independent charity programs to help patients financially with medication costs, as long as pharmaceutical companies have no control over these programs.

The programs must operate free from any manufacturer's influence, ensuring no connection between drug maker funding and the help patients receive. Aid should be granted solely based on need, staying neutral to drug companies' interests and the patient's healthcare choices. Additionally, drug makers cannot use these programs to track support correlating to their donations or prescription sales.

(a) This division shall not be deemed to affect a pharmacist’s ability to substitute a prescription drug pursuant to Section 4073 of the Business and Professions Code.

(b)

(1) This division shall not prohibit or limit assistance to a patient provided by an independent charity patient assistance program.

(2) For purposes of this section, “independent charity patient assistance program” means a program that meets all of the following requirements:

(A) The program does not allow a pharmaceutical manufacturer or an affiliate of the manufacturer, including, but not limited to, an employee, agent, officer, shareholder, contractor, wholesaler, distributor, or pharmacy benefits manager, to exert any direct or indirect influence or control over the charity or subsidy program.

(B) Assistance is awarded in a truly independent manner that severs any link between a pharmaceutical manufacturer’s funding and the beneficiary.

(C) Assistance is awarded without regard to the pharmaceutical manufacturer’s interest and without regard to the beneficiary’s choice of product, provider, practitioner, supplier, health insurance, health care service plan, or other health coverage.

(D) Assistance is awarded based upon a reasonable, verifiable, and uniform measure of financial need that is applied in a consistent manner.

(E) The pharmaceutical manufacturer does not solicit or receive data from the program that would facilitate the manufacturer in correlating the amount or frequency of its donations with the number of subsidized prescriptions for its products.

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