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Chicago Medical Society Endorses FLAT Prices Act

WHILE STATES try to unlock the black box of manufacturer pricing strategies by requiring disclosure of how prices are set and how rebates are handled throughout the supply chain, federal lawmakers are introducing similar bills that provide enforcement mechanisms beyond those available to states. U.S. Senator Richard Durbin and U.S. Rep. Jared Golden have introduced the Forcing Limits on Abusive and Tumultuous (FLAT) Prices Act. FLAT would require companies to report price hikes and would limit the market exclusivity period granted with a drug patent if the price of the drug goes up more than 10% in one year, 18% in two years, or 25% in three years. Failure to report price hikes would limit a drug’s exclusivity period further.

Illinois lawmakers introduced bills in 2017-2018 (S 1971 and HR 3572). These bills provided regulation for the creation of a list of drugs used to set the maximum allowable cost (MAC) on which reimbursement to a pharmacy or pharmacist may be based, provided that before a PBM places or continues a particular drug on a maximum allowable cost list, the drug must meet specified requirements, and provided for the duties of a PBM in his or her use of a MAC list, and provided for a reasonable administrative appeal. Both failed to pass.

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