California OSHPD Announces SB 17 Implementation Plan

California’s Office of Statewide Health Planning and Development (OSHPD) has released an implementation plan for California’s new drug transparency law SB 17.  The first part of the law to take effect will require manufacturers of drugs experiencing greater than 16% increases in WAC over three calendar years to provide 60 days’ advance notice to state purchasers as well as healthcare service plans, health insurers, and PBMs that register with OSHPD.  OSHPD is planning to compile this registry in November and December.  Purchasers are now able to register on the OSHPD website at  OSHPD anticipates the registry being available to drug manufacturers January 1, 2018, in time for the advance notice requirements to become effective.

Separately, manufacturers of drugs with WAC increases that trigger advance notice must, on a quarterly basis, report additional cost transparency data to OSHPD.  This reporting requirement will first apply to increases taking place in the first quarter of 2019.  OSHPD intends to begin collecting this information from manufacturers in April 2019.

The law also requires a manufacturer of a drug introduced to market at a WAC above the Medicare Part D specialty drug threshold to notify OSHPD within three days after the product’s commercial release.  OSHPD intends to begin collecting this information in January 2019.

OSHPD plans to draft regulations implementing SB 17 in April through June 2018, with outreach to stakeholders from January through March.  It anticipates these regulations taking effect January 2019.  Stakeholders can follow developments on the OSHPD drug price transparency website.

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