Drug Production Costs Transparency Requirements

The bill requires a drug manufacturer that produces a prescription drug made available in Colorado and for which the wholesale acquisition cost equals or exceeds $50,000 per year or per course of treatment to submit a report to the Colorado commission on affordable health care (commission) detailing the production costs for the drug. The report is to include:

• Costs for research and development;
• Clinical trials and regulatory costs;
• Costs for materials, manufacturing, and administration attributable to the drug;
• Costs paid by another entity, including grants, subsidies, or other support;
• Acquisition costs, including patents and licensing costs;
• Marketing and advertising costs.

Additionally, a manufacturer must report the cumulative annual history of increases in the average wholesale price and wholesale acquisition cost of the drug, the total company profits attributable to the drug, and the total amount of financial assistance the manufacturer has provided through patient prescription assistance programs.

Manufacturers must submit the report to the commission by August 1, 2016.

By June 1, 2016, the commission must develop a form for manufacturers to use to submit the report. Additionally, the commission is to submit a report to the general assembly by December 1, 2016, that outlines the information reported by drug manufacturers and contains any recommendations the commission may have regarding legislative, administrative, or other policy changes based on the data received from drug manufacturers.

(Note: This summary applies to this bill as introduced.)