The proposed bill, SB 2384, 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, including "maximum fair price," which is the highest price for a referenced drug as published by the Secretary of the U.S. Department of Health and Human Services. The bill prohibits the state, participating ERISA plans, and health plans from purchasing referenced drugs for a cost higher than this maximum fair price.

The bill allows ERISA plans to opt into its provisions by notifying the insurance commissioner annually. It requires any entity that sells, distributes, or delivers drugs in the state to maintain a registered agent and office within the state. The insurance commissioner is granted authority to implement regulations to enforce the chapter's requirements.

Additionally, the bill mandates that any savings generated from the provisions must be used to reduce costs for consumers, with an emphasis on promoting health equity. State entities, health plans, and participating ERISA plans are required to report annually on the savings achieved and how they were utilized.

Violations of the bill can result in fines of $1,000 for each transaction, and the attorney general is authorized to enforce its provisions. Manufacturers are prohibited from withdrawing referenced drugs from sale to avoid compliance with price limitations and must negotiate in good faith regarding pricing. Penalties for non-compliance include significant fines based on the annual savings determined by the insurance commissioner. The bill also includes a severability clause to ensure that if any provision is found invalid, the remaining provisions remain in effect.