The proposed bill, SB 468, aims to protect Rhode Island residents from excessive prices for prescription drugs by establishing a new chapter titled "Prescription Drug Cost Protection." This legislation defines key terms related to health plans and introduces a maximum fair price for referenced drugs, which is the highest price that can be paid for these drugs. It prohibits any state entity, participating ERISA plan, or health plan from purchasing referenced drugs at prices exceeding this maximum fair price.

The bill outlines that any savings generated from compliance with these provisions must be used to reduce costs for consumers. It allows ERISA plans to opt-in to the provisions of the bill and requires manufacturers to provide written notice to the insurance commissioner and the attorney general 180 days prior to withdrawing any referenced drug from sale or distribution in the state.

Additionally, the bill establishes penalties for violations, including fines for purchasing referenced drugs above the maximum fair price and for manufacturers that withdraw drugs to avoid compliance. The insurance commissioner is granted the authority to implement regulations to enforce these requirements and is responsible for overseeing the reporting of savings achieved from compliance. The act will take effect upon passage.