BILL NUMBER: S4786A
SPONSOR: RIVERA
 
TITLE OF BILL:
An act to amend the public health law, in relation to enacting the "New
York affordable drug manufacturing act"
 
PURPOSE:
Enacts the "New York Affordable Drug Manufacturing Act".
 
SUMMARY OF SPECIFIC PROVISIONS:
Section 1 provides a short title, the "New York Affordable Drug Manufac-
turing Act."
Section 2 amends article 2-A of the public health law by adding a new
title IV, the New York Affordable Drug Manufacturing Act, which will
help increase patient access to affordable drugs. This section provides
definitions for the terms "generic prescription drug" and "partner-
ships." This section provides language regarding criteria for the
commissioner to enter into a partnership resulting in the production or
distribution of generic prescription drugs with the intent it will be
affordable to private and public consumers. This section also identifies
points that the department should consider when setting drug prices,
along with reporting requirements and proprietary information.
Section 3 provides the severability clause. Section 4 provides the
effective date.
 
JUSTIFICATION: Prescription drugs costs, even for generics, continue
to rise out of reach for patients and insurers, both public and private.
New York State itself spends millions of dollars on prescription drugs
through its public health insurance programs and self-funded coverage of
our state workforce. One cause of drug price increases is lack of compe-
tition. Nearly 90% of prescription drugs are generic, yet a small number
of companies manufacture them. Many contend this lack of competition has
led to large price increases of widely-used and important medications
like antibiotics and epinephrine without evidence of increased costs of
manufacturing. Aside from cost, there are some medications that are at
risk of being in short supply. It is important to find creative ways to
lower drug costs and ensure medications are available.
This bill does not propose a new concept. U.S. Senator Elizabeth Warren
during her 2020 presidential run called for the U.S. government to
begin manufacturing generic medications to address rising prices, lack
of competition in the market, and the potential for shortages in essen-
tial medications. California became the first state in the nation to
sign into law legislation to begin the process of state manufacturing or
distribution of generic medications. This New York legislation is
modeled after the California statute and would allow New York to partner
with various entities, including other states, to lower costs and
protect against short supplies.
Similar to California's statute, this legislation directs the Department
of Health (DOH) to identify generic drugs that are high cost or suscep-
tible to shortages for possible manufacturing partnerships. It specif-
ically requires that the DOH consider one type of insulin, given the
high costs and life-saving nature of this medication that over 7 million
diabetics in the U.S. depend upon daily. The "New York Affordable Drug
Manufacturing Act" would provide New York with an important tool to
control drug costs for its taxpayers, residents, and those who lack
health insurance by allowing. New York to pursue its own drug manufac-
turing and partner with other states moving in this direction to both
lower costs and protect against shortages of certain drugs.
 
LEGISLATIVE HISTORY:
2019-2020: S9020/No Same As
2021-2022: S3048/No Same As
 
FISCAL IMPLICATIONS:
Initial costs to be determined, but substantial long term savings as
generic prescription drug costs for the state would be much lower.
 
EFFECTIVE DATE:
This act shall take effect on the first January next succeeding one year
after it shall have become a law.