SB 190 — An Act providing for pharmaceutical transparency; establishing the Pharmaceutical Transparency Review Board and providing for its powers and duties; establishing the Pharmaceutical Transparency Review Fund; and imposing a penalty.

PRINTER'S NO.   140

                    THE GENERAL ASSEMBLY OF PENNSYLVANIA



                        SENATE BILL
                        No. 190
                                               Session of
                                                 2025

     INTRODUCED BY STREET, KEARNEY, HUGHES, COSTA, KANE, SCHWANK AND
        LAUGHLIN, JANUARY 29, 2025

     REFERRED TO BANKING AND INSURANCE, JANUARY 29, 2025


                                    AN ACT
 1   Providing for pharmaceutical transparency; establishing the
 2      Pharmaceutical Transparency Review Board and providing for
 3      its powers and duties; establishing the Pharmaceutical
 4      Transparency Review Fund; and imposing a penalty.
 5      The General Assembly of the Commonwealth of Pennsylvania
 6   hereby enacts as follows:
 7   Section 1.    Short title.
 8      This act shall be known and may be cited as the
 9   Pharmaceutical Transparency Act.
10   Section 2.    Definitions.
11      The following words and phrases when used in this act shall
12   have the meanings given to them in this section unless the
13   context clearly indicates otherwise:
14      "Board."    The Pharmaceutical Transparency Review Board
15   established in section 3(a).
16      "Fund."    The Pharmaceutical Transparency Review Fund
17   established in section 8(a).
18      "Manufacturer."    An entity that:
19          (1)    Does the following:
 1                  (i)    engages in the manufacture of a prescription
 2            drug product; or
 3                  (ii)    enters into a lease with another manufacturer
 4            to market and distribute a prescription drug product
 5            under the entity's own name.
 6            (2)   Sets or changes the wholesale acquisition cost of
 7      the prescription drug product that the entity manufactures or
 8      markets.
 9      "Prescription drug product."        Any of the following:
10            (1)   A brand name drug licensed under a new drug
11      application.
12            (2)   A generic drug licensed under an abbreviated new
13      drug application.
14            (3)   A biologic licensed under a biologic license
15      application.
16   Section 3.     Pharmaceutical Transparency Review Board.
17      (a)     Establishment.--The Pharmaceutical Transparency Review
18   Board is established as an independent board. The board shall be
19   an instrumentality of the Commonwealth and a body corporate and
20   politic.
21      (b)     Purpose.--The purpose of the board is to review high-
22   cost prescription drug products and develop recommendations for
23   addressing affordability burdens faced by residents, State and
24   local government agencies, commercial health plans, health care
25   providers, employers, pharmacies licensed in this Commonwealth
26   and other stakeholders.
27      (c)     Composition.--
28            (1)   The board shall be composed of the following
29      individuals, who must have expertise in health care economics
30      or clinical medicine:

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 1                (i)    One member appointed by the Governor who shall
 2          act as chair.
 3                (ii)    One member appointed by the President pro
 4          tempore of the Senate.
 5                (iii)    One member appointed by the Speaker of the
 6          House of Representatives.
 7                (iv)    One member appointed by the Majority Leader of
 8          the Senate.
 9                (v)    One member appointed by the Majority Leader of
10          the House of Representatives.
11                (vi)    One member appointed by the Minority Leader of
12          the Senate.
13                (vii)    One member appointed by the Minority Leader of
14          the House of Representatives.
15          (2)   A member may not be an employee of, a board member
16    of or a consultant to a manufacturer or trade association for
17    manufacturers.
18          (3)   In appointing members to the board, an appointing
19    authority shall consider and disclose a conflict of interest,
20    including whether the individual has an association,
21    including a financial or personal association, that has the
22    potential to bias or has the appearance of biasing an
23    individual's decision in matters related to the board or the
24    conduct of the board's activities.
25    (d)   Term of office.--
26          (1)   Except as provided under paragraph (2), the term of
27    a member of the board is five years.
28          (2)   The terms of the initial members of the board are as
29    follows:
30                (i)    Members appointed under subsection (c)(1)(iv)

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 1            and (vi) shall serve initial terms of three years.
 2                  (ii)    Members appointed under subsection (c)(1)(v)
 3            and (vii) shall serve initial terms of four years.
 4                  (iii)    Members appointed under subsection (c)(1)(i),
 5            (ii) and (iii) shall serve initial terms of five years.
 6      (e)   Board staff.--The chair shall appoint an executive
 7   director, general counsel and other staff for the board to the
 8   extent funds are available to the board for this purpose.
 9      (f)   Compensation.--A member of the board:
10            (1)   May receive compensation as a member of the board in
11      conformity with the rules of the Executive Board.
12            (2)   Is entitled to reimbursement for expenses in
13      accordance with Commonwealth regulations.
14      (g)   Quorum.--A majority of the members of the board shall
15   constitute a quorum for the purposes of conducting the business
16   of the board.
17      (h)   Meetings.--
18            (1)   The board shall meet for the following purposes:
19                  (i)    Subject to subparagraphs (ii) and (iv), the
20            board shall meet in open session at least once each
21            quarter to review prescription drug product information.
22                  (ii)    The following actions of the board shall be
23            made in open session:
24                         (A)   Deliberations on whether to subject a
25                  prescription drug product to a review under
26                  subsection (b).
27                         (B)   Decisions by the board, including agreeing
28                  to reports created by the board under section 9.
29                  (iii)    The chair may cancel or postpone a meeting if
30            the board has no prescription drug products before it to

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 1            review.
 2                  (iv)   The board may meet in closed session to discuss
 3            proprietary data and information.
 4            (2)   The board shall provide public notice of a board
 5      meeting at least two weeks prior to the meeting.
 6            (3)   Materials for a board meeting shall be made
 7      available to the public at least one week prior to the
 8      meeting.
 9            (4)   The board shall provide an opportunity for public
10      comment at each open meeting of the board and shall provide
11      the public with the opportunity to provide written comments
12      to the board.
13            (5)   The board may allow expert testimony at board
14      meetings, including when the board meets in closed session.
15   Section 4.     Conflict of interest.
16      (a)   Recusal.--Board members shall recuse themselves from
17   decisions related to a prescription drug product if a conflict
18   of interest exists. A conflict of interest exists if a member,
19   or an immediate family member of the member, has received or
20   could receive any of the following:
21            (1)   A direct financial benefit of any amount deriving
22      from the result or finding of a study or determination by or
23      for the board.
24            (2)   A financial benefit from a person that owns,
25      manufactures or provides prescription drug products, services
26      or items to be studied by the board that, in the aggregate,
27      exceeds $5,000 per year.
28      (b)   Duty to disclose.--A conflict of interest shall be
29   disclosed by:
30            (1)   The board when hiring board staff.

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 1            (2)   The appointing authority when appointing members to
 2      the board.
 3            (3)   The board when a member of the board is recused from
 4      a final decision resulting from a review of a prescription
 5      drug product.
 6      (c)   Time for disclosure.--A conflict of interest shall be
 7   disclosed:
 8            (1)   in advance of the first open meeting after the
 9      conflict is identified; or
10            (2)   within five days after the conflict is identified.
11      (d)   Public disclosure.--
12            (1)   A conflict of interest disclosed under subsection
13      (a) shall be posted on the publicly accessible Internet
14      website of the board unless the chair recuses the member from
15      a final decision resulting from a review of a prescription
16      drug product.
17            (2)   A posting under paragraph (1) shall include the
18      type, nature and magnitude of the interests of the member
19      involved.
20      (e)   Prohibition.--Members of the board, board staff and
21   third-party contractors of the board may not accept a gift or
22   donation of services or property that indicates a potential
23   conflict of interest or has the appearance of biasing the work
24   of the board.
25      (f)   Definition.--As used in this section, the term
26   "financial benefit" includes honoraria, fees, stock, the value
27   of the member's or immediate family member's stock holdings and
28   any direct financial benefit deriving from the findings of a
29   review conducted under this act.
30   Section 5.     Powers and duties of board.

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 1      (a)   Report.--The board shall assess and issue a report as
 2   provided under section 9(a) on how to make prescription drugs
 3   affordable for residents of this Commonwealth.
 4      (b)   Pricing information.--To the extent practicable, the
 5   board may access pricing information for prescription drug
 6   products by:
 7            (1)   Entering into a memorandum of understanding with
 8      another state to which manufacturers already report pricing
 9      information.
10            (2)   Accessing other available pricing information.
11      (c)   Independent contractors.--
12            (1)   The board may enter into a contract with a
13      qualified, independent third party for any service necessary
14      to carry out the powers and duties of the board.
15            (2)   Unless permission is granted by the board, a third
16      party hired by the board may not release, publish or
17      otherwise use any information to which the third party has
18      access under the third party's contract.
19      (d)   Penalty.--The board may assess a fee of $20,000 per day
20   per drug on a manufacturer that fails to comply with the
21   provisions of this act.
22   Section 6.     Board assessment of prescription drug affordability.
23      (a)   Duty of board.--After receiving information about
24   prescription drug products reported under section 7, the board
25   shall analyze the reported data and any other relevant data in
26   order to publish reports on the prescription drug products
27   subject to reporting.
28      (b)   Posting.--The board shall post information about
29   prescription drug products on its publicly accessible Internet
30   website in a manner that does not reveal specific trade secrets

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 1   about a particular drug product.
 2      (c)   Regulations.--The board may promulgate regulations on
 3   what can be considered a trade secret for purposes of
 4   publication of reported data.
 5   Section 7.     Pharmaceutical transparency.
 6      (a)   Applicability.--This section shall only apply to a
 7   prescription drug product that meets one of the following
 8   criteria:
 9            (1)   The drug has an average wholesale acquisition cost
10      of at least $5,000 annually or per course of treatment if
11      less than a year, adjusted annually to the Consumer Price
12      Index for All Urban Consumers, and which:
13                  (i)    the average wholesale acquisition cost has
14            increased by 50% or more over the past five years; or
15                  (ii)    the average wholesale acquisition cost has
16            increased by 15% or more over the past 12 months.
17            (2)   The board has determined that the drug has created
18      an affordability burden in this Commonwealth.
19      (b)   Information from manufacturer.--A manufacturer of a
20   prescription drug product shall file with the board the
21   following information on a form prescribed by the board:
22            (1)   The costs for the development and manufacturing of
23      the drug, including:
24                  (i)    The total research and development costs accrued
25            in the United States and paid by the manufacturer in the
26            development of the drug.
27                  (ii)    The total costs of clinical trials and other
28            regulatory costs accrued in the United States and paid by
29            the manufacturer.
30                  (iii)    The total costs of materials, manufacturing

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 1        and distribution attributable to the drug for each of the
 2        previous three years.
 3              (iv)    The costs accrued in the United States and paid
 4        by an entity other than the manufacturer for research and
 5        development, including any amount from Federal, State or
 6        other governmental programs or any form of subsidies,
 7        grants or other support.
 8              (v)    Other costs to acquire the drug, including costs
 9        for the purchase of or leasing the rights to patents,
10        licensing or acquisition of a corporate entity owning
11        rights to the drug while in development.
12              (vi)    The marketing and advertising costs accrued in
13        the United States for the promotion of the drug directly
14        to consumers for each of the previous three years,
15        including:
16                     (A)   Costs associated with coupons or discounts
17              that are directed to consumers and the amount
18              redeemed in the United States.
19                     (B)   Marketing and advertising costs accrued in
20              the United States for promotion of the drug directly
21              or indirectly to prescribers.
22                     (C)   All other advertising costs accrued in the
23              United States for the drug.
24        (2)   A five-year history of average wholesale acquisition
25    cost increases for the drug expressed as percentages,
26    including the months each average wholesale acquisition cost
27    increase took effect.
28        (3)   The total profit attributable to the drug and
29    realized in the United States as represented:
30              (i)    In dollars.

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 1                (ii)    As a percentage of the total company profits
 2          realized in the United States that were derived from the
 3          sale of the drug for each of the previous three years.
 4          (4)   The aggregate amount of all rebates that the
 5    manufacturer provided to all payers, including insurers and
 6    pharmacy benefit managers, for the sale of the drug within
 7    this Commonwealth for each of the previous three years.
 8          (5)   A description of the manufacturer's patient
 9    prescription assistance programs available in the United
10    States that include a drug under subsection (a), including:
11                (i)    The amount of financial assistance provided for
12          each of the previous three years.
13                (ii)    The amount of financial assistance provided to
14          residents of this Commonwealth for each of the previous
15          three years.
16                (iii)    The average per capita amount of assistance to
17          residents of this Commonwealth and the drugs for which
18          assistance was provided for each of the previous three
19          years.
20                (iv)    The eligibility and benefit structure of the
21          patient prescription assistance programs, including
22          coupons.
23          (6)   Payments or financial incentives, direct or
24    indirect, to hospitals, health care providers or physicians
25    located in this Commonwealth attributable to a drug under
26    subsection (a), including speaking fees, dinners, research,
27    consulting, charitable donations, grants or other incentives,
28    discounts or rebates for each of the previous three years.
29    (c)   Filing deadlines.--
30          (1)   For a drug described under subsection (a)(1),

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 1      filings must be submitted to the board annually by March 31.
 2            (2)   For a drug described under subsection (a)(2),
 3      filings must be submitted to the board within 90 days of the
 4      board making a formal determination to review.
 5      (d)   Audit and certification.--A filing under this section
 6   shall be audited and certified by an independent third-party
 7   auditor prior to filing.
 8      (e)   Regulations.--The board may promulgate regulations as
 9   may be necessary to carry out the provisions of this section.
10   Section 8.     Pharmaceutical Transparency Review Fund.
11      (a)   Establishment.--
12            (1)   The Pharmaceutical Transparency Review Fund is
13      established as a fund in the State Treasury. The fund shall
14      be used only to provide funding for the board and for the
15      purposes authorized under this act, including any costs
16      expended by any State agency to implement this act.
17            (2)   The fund shall be invested and reinvested in the
18      same manner as other State funds. Any investment earnings
19      shall be retained to the credit of the fund.
20            (3)   The fund shall be subject to an audit by the Auditor
21      General.
22            (4)   This subsection may not be construed to prohibit the
23      fund from receiving money from any other source.
24      (b)   Continuing appropriation.--Money in the fund is
25   appropriated on a continuing basis to the board for the purposes
26   under subsection (a).
27      (c)   Assessment.--
28            (1)   The board shall be funded by an assessment on
29      manufacturers. A manufacturer shall pay the assessment within
30      the time prescribed by the board.

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 1            (2)    Annually, the board shall assess and collect fees
 2      from manufacturers as provided for in this subsection.
 3            (3)    The board shall assess each manufacturer based on
 4      the manufacturer's relative share of gross revenue from
 5      prescription drug sales in this Commonwealth.
 6            (4)    The board shall pay all money collected from the
 7      assessment into the fund.
 8      (d)   Repayment.--Any appropriation or transfer of money to
 9   the board from the General Fund shall be repaid to the General
10   Fund from the assessments collected under this section.
11   Section 9.      Reports by board.
12      (a)   Submission.--A report created by the board shall be
13   submitted to the following:
14            (1)    The Governor.
15            (2)    The President pro tempore of the Senate.
16            (3)    The Speaker of the House of Representatives.
17            (4)    The Majority Leader of the Senate.
18            (5)    The Majority Leader of the House of Representatives.
19            (6)    The Minority Leader of the Senate.
20            (7)    The Minority Leader of the House of Representatives.
21            (8)    The chairperson and minority chairperson of the
22      Appropriations Committee of the Senate.
23            (9)    The chairperson and minority chairperson of the
24      Appropriations Committee of the House of Representatives.
25            (10)    The chairperson and minority chairperson of the
26      Banking and Insurance Committee of the Senate.
27            (11)    The chairperson and minority chairperson of the
28      Insurance Committee of the House of Representatives.
29            (12)    The chairperson and minority chairperson of the
30      Health and Human Services Committee of the Senate.

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 1            (13)    The chairperson and minority chairperson of the
 2      Health Committee of the House of Representatives.
 3      (b)   Report.--
 4            (1)    By January 2028, the board shall submit a report on
 5      recommendations regarding how to make prescription drugs more
 6      affordable for all individuals, providers and health plans in
 7      this Commonwealth.
 8            (2)    The report shall include:
 9                   (i)    An analysis of the role of the supply chain in
10            prescription drug costs.
11                   (ii)    The role of price transparency in lowering
12            costs.
13                   (iii)    How high patient out-of-pocket costs relate to
14            prescription drug costs and affordability.
15            (3)    The report shall review pricing from the
16      manufacturer through the supply chain to the point of service
17      and the patient.
18            (4)    The report shall examine the role of health plans
19      and pharmacy benefit management contractors in prescription
20      drug costs.
21            (5)    The report shall examine actions undertaken by other
22      states to make prescription drugs more affordable and the
23      impact of those actions.
24      (c)   Further reporting.--On or before December 31 of each
25   year, the board shall submit a report that includes:
26            (1)    Price trends for prescription drug products.
27            (2)    Specific information about prescription drug
28      products and price increases that were reported to the board.
29      (d)   Study.--By June 2026, the board shall submit a study of
30   the operation of the generic drug market that includes a review

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 1   of physician-administered drugs. The study shall include:
 2          (1)    The prices of generic drugs on a year-over-year
 3      basis.
 4          (2)    The degree to which generic drug prices affect
 5      yearly insurance premium changes.
 6          (3)    Annual changes in insurance cost-sharing for generic
 7      drugs.
 8          (4)    The potential for and history of drug shortages.
 9          (5)    The degree to which generic drug prices affect
10      yearly State Medicaid spending.
11          (6)    Any other information relevant to the study.
12   Section 10.   Effective date.
13      This act shall take effect in 60 days.




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