SENATE BILL REPORT
SB 5203
As of February 25, 2021
Title: An act relating to the production, distribution, and purchase of generic prescription drugs.
Brief Description: Producing, distributing, and purchasing generic prescription drugs.
Sponsors: Senators Van De Wege, Carlyle, Frockt, Hasegawa, Keiser, Liias, Nguyen, Randall, Robinson, Salomon, Stanford and Wilson, C..
Brief History:
Committee Activity: Health & Long Term Care: 1/29/21, 2/05/21 [DPS-WM, DNP, w/oRec].
Ways & Means: 2/19/21.
Brief Summary of First Substitute Bill
  • Allows the Health Care Authority (HCA) to enter into partnerships with other states, state agencies, or nonprofit entities to produce, distribute, or purchase generic prescription drugs.
  • Requires state purchased health care programs to purchase generic drugs through the partnership and allows other entities to purchase through the partnership voluntarily.
SENATE COMMITTEE ON HEALTH & LONG TERM CARE
Majority Report: That Substitute Senate Bill No. 5203 be substituted therefor, and the substitute bill do pass and be referred to Committee on Ways & Means.
Signed by Senators Cleveland, Chair; Frockt, Vice Chair; Conway, Keiser, Randall, Robinson and Van De Wege.
Minority Report: Do not pass.
Signed by Senators Muzzall, Ranking Member; Rivers and Wilson, J.
Minority Report: That it be referred without recommendation.
Signed by Senators Holy and Padden.
Staff: Greg Attanasio (786-7410)
SENATE COMMITTEE ON WAYS & MEANS
Staff: Sandy Stith (786-7710)
Background:

Prescription Drug Purchasing Consortium.  In 2005, the Legislature directed the Health Care Authority (HCA) to establish a prescription drug purchasing consortium.  In addition to state agencies, the consortium may include, on a voluntary basis, local government, private entities, labor organizations, and individuals without insurance, or who are underinsured for prescription drug coverage.  State purchased health care services purchased through health carriers and health maintenance organizations are exempt from participating in the consortium.  In 2006, Washington and Oregon formed the Northwest Prescription Drug Consortium (Northwest Consortium) to expand their purchasing power.  The Northwest Consortium offers access to retail pharmacy discounts, pharmacy benefit management services, rebate management services, and a prescription discount card for uninsured residents.

Summary of Bill (First Substitute):

HCA may enter into partnerships with another state, a group of states, a state agency, a nonprofit organization, or any other entity to produce, distribute, or purchase generic prescription drugs.  HCA may only enter into a partnership with a nongovernmental entity after a competitive bidding process. The generic prescription drugs must be produced or distributed by a drug company or generic drug manufacturer that is registered with the United States Food and Drug Administration.  The HCA shall only enter into partnerships to produce, distribute, or purchase a generic prescription drug at a price that results in savings to public and private purchasers and consumers. 

 

State purchased health care programs must purchase the generic prescription drugs through the partnership, unless the state purchased health care program can obtain the generic prescription drug at a cost savings through another purchasing mechanism.  Local governments, private entities, health carriers, and others may choose to voluntarily purchase the generic prescription drugs from the HCA as available quantities allow. 

EFFECT OF CHANGES MADE BY HEALTH & LONG TERM CARE COMMITTEE (First Substitute):
  • Requires HCA to conduct a competitive bidding process before entering into a partnership with a nongovernmental entity
  • Amends the definition of generic drug to mirror the Federal definition.
Appropriation: None.
Fiscal Note: Available.
Creates Committee/Commission/Task Force that includes Legislative members: No.
Effective Date: Ninety days after adjournment of session in which bill is passed.
Staff Summary of Public Testimony on Original Bill (Health & Long Term Care):

The committee recommended a different version of the bill than what was heard.  PRO:  No one should have to worry about how to obtain life savings drugs.  This bill is a lifeline for those with chronic diseases.  A competitive biosimilar market would drastically reduce the cost of drugs.  The bill can go into effect immediately and build on the work the prescription drug consortium already does.
 
OTHER:  The definition of generic drug should be consistent with the federal definition.

Persons Testifying (Health & Long Term Care): PRO: Senator Kevin Van De Wege, Prime Sponsor; Madi Johnson, Washington insulin4all; Kevin Wren, #insulin4all Washington; Marcia Stedman, Health Care for All-Washington.
OTHER: Jeff Gombosky, Pharmaceutical Research and Manufacturers of America.
Persons Signed In To Testify But Not Testifying (Health & Long Term Care): No one.