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Drug Pricing Review

The HPC helps manage pharmaceutical spending by conducting reviews of high-cost drugs referred to it by MassHealth, the Massachusetts Medicaid Program, and assessing if the pricing is unreasonable or excessive in relation to the value.

Statutory Authority

Sections 46 and 6 of Chapter 41 of the Acts of 2019, An Act Making Appropriations for the Fiscal Year 2020 (the “FY 2020 Budget”), gives authority to the Executive Office of Health and Human Services (EOHHS), and specifically to the MassHealth program, to negotiate directly with pharmaceutical drug manufacturers for supplemental rebates, and to the Health Policy Commission (HPC) to investigate the manufacturer’s pricing of the drug if an agreement cannot be reached. Upon a referral from MassHealth, the law, codified as M.G.L. c. 6D, § 8A, authorizes the HPC to collect information related to the referred manufacturer’s pricing of certain high-cost drugs, including through a standard reporting form developed by HPC with input from manufacturers. Based on the submissions from manufacturers and other information from MassHealth, the HPC may identify a proposed value for the drug and ultimately determine whether the manufacturer’s pricing of the drug is unreasonable or excessive in relation to the HPC’s proposed value for the drug. In addition, the HPC may, in consultation with MassHealth, propose a supplemental rebate for the drug.

Regulation

The HPC issued a regulation to implement this authority. The slides from the HPC’s February 5th presentation in which the Board voted to approve the final regulation are available here.

Standard Reporting Form

As required by M.G.L. c. 6D § 8A and 958 CMR 12.00 et seq., the HPC has developed a Standard Reporting Form which referred manufacturers will be required to complete and submit to the HPC. The Standard Reporting Form may be updated from time to time by the Commission, with advance notice to and input from Manufacturers and other interested stakeholders.

 

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