Sec. 304. Prohibition against excessive price
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Beginning on the effective date of the regulation required by subsection (b), the manufacturer of a prescription drug or medical device shall not charge an excessive price, as determined pursuant to such regulation, for such drug or device. The Board shall by regulation prescribe a formula for determining whether the average manufacturer price of such drug or device over an annual quarter is an excessive price. If the Board determines, on its own initiative or in response to a petition submitted under subsection (d), that the manufacturer of a prescription drug or medical device charges an excessive price for such drug or device in violation of subsection (a)— the Board shall give the manufacturer— notice of such violation; and subject to subsection (d), a period to correct such violation; and if the manufacturer fails to correct the violation by the end of such period, the manufacturer shall be subject to section 305, section 1927(c)(2)(E) of the Social Security Act (as added by subsection
(c)of section 305), and section 4192 of the Internal Revenue Code of 1986, as added by subsection
(d)of section 305. Any person may petition the Board to make a determination under subsection
(c)regarding the pricing of a prescription drug or medical device. Not later than 90 days after the date of receipt of such a petition, the Board shall— make a determination under subsection
(c)regarding such pricing; or decline to make such a determination. The Board shall not be required to give a manufacturer an opportunity to correct a violation, as described in subsection (c)(1)(B), before the manufacturer becomes subject to the provisions described in subsection (c)(2) for such violation, if— the Board has already provided such an opportunity to correct to the manufacturer; and the Board finds that the violation of subsection
(a)is a continuation of an earlier violation with respect to which such an opportunity was provided. The formula required by subsection
(a)shall at a minimum take into consideration— the average manufacturer price of the prescription drug or medical device over the respective annual quarter or quarters; the average manufacturer price of other prescription drugs or medical devices in the same therapeutic class over the same quarter or quarters; the average price at which the prescription drug or medical device and other prescription drugs and medical devices in the same therapeutic class have been sold by manufacturers in countries other than the United States; the costs associated with producing and marketing the prescription drug or medical device, the value of the drug or device to patients where sufficient data is available to determine such value, the total Federal investment in the development of the drug or device, the size of the patient population receiving the drug or device, and other factors determinative as to the true cost of production; and whether the price of the prescription drug or medical device increased during any annual quarter by a percentage that is more than 2 percent greater than the CPI increase percentage (as defined in section 215(i) of the Social Security Act ( 42 U.S.C. 415 )) for the respective annual quarter.
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Sec. 304
Prohibition against excessive price
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