As part of a growing national trend among states concerning drug pricing transparency, recently enacted legislation in Colorado requires manufacturers marketing drugs to provide certain written information to prescribers regarding the drug’s cost and generic alternatives.
Colorado House Bill 19-1131, Prescription Drug Cost Education Concerning a Requirement to Share the Wholesale Acquisition Cost of a Drug When Sharing Information Concerning the Drug with Another Party, went into effect Aug. 2, 2019. Maine, Texas, Maryland, and Washington passed similar legislation this year regulating drug pricing disclosures by manufacturers, and these laws have either gone into effect recently or will shortly. The Colorado law, however, is worth reviewing in additional detail, as it takes a particularly broad view of the scope of marketing activities that fall within the purview of the rule’s application and could serve as a predicate for states considering initiating similar pricing transparency actions.
The law applies to all manufacturers — including their employees, agents and representatives — who engage in activities that are considered “prescription drug marketing.” The law broadly defines “prescription drug marketing” as “any activity that does not include conversations at scientific conferences and may include in-person meetings, physical mailings, telephonic conversations, video conferencing, electronic mailing or texting, or facsimile transmissions that provides educational or marketing information or materials regarding a prescription drug.” When engaging in prescription drug marketing activities, manufacturers are required to provide the following information to prescribers in writing:
- The wholesale acquisition cost of the drug.
- The names of at least three generic prescription drugs in the same therapeutic class as the drug being marketed. If three are not available, the manufacturer must provide as many as are available for prescriptive use.
As manufacturers implement compliance with this rule, they should also consider training their sales representatives and other agents to include this information along with the typical information about drug efficacy and safety they provide to prescribers.
Manufacturers should continue to monitor this law and other proposed laws in Colorado and other states that, if finalized, may have additional impacts on drug marketing practices. To discuss legal issues raised by this law and similar state regulations and any potential impacts they may have on prescription drug marketing practices, please consult the authors or another member of the McGuireWoods life sciences team.