The Division of Consumer Affairs has introduced new regulations requiring key players in the prescription drug supply chain to disclose pricing activities. These rules, effective as of October 15 following approval by the Office of Administrative Law, aim to track drug prices across the supply chain to understand price increases better. The initiative stems from a 2023 law designed to combat rising prescription drug costs.
Entities such as manufacturers, insurance carriers, wholesalers, pharmacy benefits managers (PBM), and pharmacy services administrative organizations (PSAO) are now subject to registration, reporting, and compliance requirements. A PBM manages prescription drug benefits for various payers, while a PSAO provides services to independent pharmacies.
These entities must provide information on drugs with significant price hikes or high launch prices. The Division will use this data to produce an annual report on emerging trends in prescription drug prices. This report will be available on the Division's new prescription drug pricing webpage and will assist the Drug Affordability Council in formulating policy recommendations focused on affordability.
Manufacturers are required to notify the Division about price increases and new drugs meeting specific price thresholds. Carriers must report spending details for top prescription drugs, PSAOs must disclose negotiated reimbursement rates, and wholesalers along with PBMs need to provide pricing and volume information.
Attorney General Matt Platkin highlighted the impact of high prescription drug costs: “The high cost of prescription drugs is a financial burden that disproportionately impacts the health and well-being of the most vulnerable among us: low-income families, the elderly, the uninsured, and people with disabilities.”
Platkin added: “Until now, we’ve been kept in the dark about the main drivers of high prescription drug costs. The new rules allow us to gain greater insight into prescription drug pricing and a better understanding of how we can help advance the goal of prescription drug affordability and accessibility.”
These specially adopted rules will be effective for up to 545 days from filing. They will also be proposed for readoption and published in the NJ Register on November 18, 2024.
