E. One representative from a statewide health management organization, appointed by the President of the Senate;

F. One representative from a statewide senior citizen organization, appointed by the Speaker of the House;

G. One representative from a drug manufacturing business, appointed by the Speaker of the House;

H. Two representatives from pharmaceutical associations, appointed by the Governor; and

I. One physician, appointed by the Governor.

The President of the Senate and the Speaker of the House shall send invitations for the first meeting of the committee to all members of the Congressional Delegation from the State.

2. Appointments. All appointments to the committee must be made no later than 30 days following the effective date of this Act. The appointing authorities shall notify the Executive Director of the Legislative Council upon making their appointments.

3. Meetings. The Chair of the Legislative Council shall call and convene the first meeting of the committee within 15 days of the date that the last committee member is appointed.

4. Chair. The members of the committee shall appoint a chair from among the membership at the first meeting of the committee.

5. Staff. Upon the approval of the Legislative Council, the Office of Policy and Legal Analysis shall provide staff support to the committee.

6. Compensation. The committee members who are Legislators are entitled to receive legislative per diem and expenses, as defined in the Maine Revised Statutes, Title 3, section 2, for each day's attendance at meetings of the committee. The members of the committee who are neither employees of the State nor Legislators are entitled to a per diem and expenses equal to the legislative per diem and expenses.

7. Duties. In order to advise the Legislature on establishing efficiencies in the State's pharmaceutical markets, the committee shall:

A. Assess covered outpatient prescription drug prices throughout the State and compare the prices to those of other states and countries;

B. Create model discount and rebate agreements using existing pharmaceutical discount purchasing and assistance programs such as those offered through Medicaid, the federal Department of Veterans Affairs, public health services and successful programs in other states and countries to secure the highest discounts and rebates available;

C. Seek to obtain the best prices for all the State's citizens requiring outpatient prescription drugs and obtain prescription drugs with the least administrative and regulatory burden on manufacturers, distributors and state agencies; and

D. Gather and publicize outpatient prescription retail drug prices in the State and show prices of comparable prescription drugs found in other states and countries, including Canada, the United Kingdom and Australia.

8. Report. The committee shall submit its findings, together with any recommendations, including recommended legislation, to the Governor and the Joint Standing Committee on Health and Human Services by January 15, 2002. If the committee requires an extension of time to make its report, it may apply to the Legislative Council, which may grant the extension.

9. Budget. The chair of the committee, with assistance from staff, shall administer the committee budget. Within 10 days after its first meeting, the committee shall present a work plan and proposed budget to the Legislative Council for approval. The committee may not incur expenses that would result in the committee exceeding its approved budget.

PART C

Sec. C-1. 22 MRSA c. 603, sub-c. I-A is enacted to read:

SUBCHAPTER I-A

VOLUNTARY REDUCTION OF PRESCRIPTION DRUG COSTS

§2686.__Voluntary reduction of prescription drug costs

It is the policy of the State to encourage the reduction of prescription drug costs paid by residents of the State, the amount paid by public programs to assist residents of the State

with the purchase of prescription drugs, the amount paid by health care coverage and benefit programs and other 3rd-party payors and the per unit cost of prescription drugs.__To achieve the goals under subsection 1, the department shall undertake a program to encourage the voluntary reduction of prescription drug costs as provided in this section.

1.__Prescription drug cost goals.__Using the total cost of all drugs dispensed in the State in 2000 as the base-line figure, the statewide price reduction goals for the cost of all prescription drugs dispensed in the State are a 5% reduction of the base-line figure for 2000 in cost by January 2003, a 10% reduction in cost by January 2004, a 15% reduction in cost by January 2005 and a 20% reduction in cost by January 2006.

2.__Voluntary reduction of prices; progress reports.__ Manufacturers or labelers of prescription drugs, as defined in section 2697, shall undertake efforts to voluntarily reduce the cost of prescription drugs and to assist in the achievement of the prescription drug cost goals established in subsection 1.__By April 1, 2002 and annually thereafter, each manufacturer or labeler shall report to the commissioner the efforts being made by the manufacturer or labeler toward the achievement of the prescription drug cost reduction goals.__Each manufacturer or labeler shall include in the annual report under this subsection progress reports stating, for each of the 100 prescription drugs of the manufacturer or labeler having the highest volume of dispensation in the State during the past calendar year, the average wholesale price for each drug, the highest, lowest and average cost for which the drug was sold and details about voluntary efforts on the part of the manufacturer or labeler to reduce the cost of prescription drugs dispensed in the State.

3.__Annual report of commissioner.__By July 1, 2002, and annually thereafter, the commissioner shall provide to the Legislature a report based on the annual progress reports filed by the manufacturers or labelers under subsection 2.__The report must include recognition of exemplary efforts by manufacturers or labelers to reduce the cost of prescription drugs, recommendations for action to bring about further reductions in cost and the names of manufacturers or labelers that are worthy of public recognition for their efforts toward the achievement of the goals of this section or that merit attention for their lack of effort toward the achievement of the goals of this section.

SUMMARY

This bill establishes the Business Advisory Committee on Prescription Drug Costs and Efficiencies. The committee is

directed to conduct a study concerning outpatient prescription drug prices in the State and obtain comparable pricing from other states and countries. The committee is charged with creating model discount and rebate agreements using existing pharmaceutical discount purchasing and assistance programs such as those offered through Medicaid, the federal Department of Veterans Affairs, public health services and other successful programs in other states and countries to secure the highest discounts and rebates available on prescription drugs.

This bill also directs the Department of Human Services to publicize the names of the pharmaceutical companies that participate and do not participate in the Maine Rx Program, established in the Maine Revised Statutes, Title 22, section 2681, and the elderly low-cost drug program, established in Title 22, section 254.

The bill enacts a program to encourage prescription drug manufacturers and labelers to voluntarily reduce the cost of drugs paid by Maine residents and by public programs to assist in the purchase of prescription drugs and the per unit cost of prescription drugs dispensed in the State. It sets goals for cost reduction and requires manufacturers and labelers to file annual progress reports stating their efforts to assist in the achievement of the State's goals and the costs of their drugs dispensed in the State. The bill requires the Commissioner of Human Services to file an annual report with the Legislature recognizing exemplary efforts and including recommendations for action and the names of manufacturers and labelers worthy of public recognition for their effort or those names of manufacturers and labelers that merit attention for their lack of effort.