Arkansas Prohibits Manufacturers from Offering Discounts on Insulin Products

On May 3, 2021, Arkansas Governor Asa Hutchinson signed HB1709 into law, which prohibits manufacturers from offering discounts on any insulin product.

Under the law, pharmaceutical manufacturer discounts is defined as a discount offered by a pharmaceutical manufacturer or an affiliate of a pharmaceutical manufacturer, directly or indirectly, on a prescription drug. This includes coupon cards, price concessions, rebates, manufacturer administrative fees, inflation payments, product discounts or fees related to procurement of prescription drug inventories, care management fees, and any other fees that are paid by a pharmaceutical manufacturer to secure placement on a drug formulary or otherwise move market share of a prescription drug that is intended to reduce the net cost to a patient, consumer, or healthcare payor.

The law notes that pharmaceutical manufacturers and their affiliates are prohibited from providing any pharmaceutical manufacturer discount on any insulin product, unless the discount is provided to directly to the end user in the form of a pharmaceutical manufacturer discount coupon card and it is adjudicated in real time using the National Council for Prescription Drug Programs claims transmission standard.

Any possible violations of the law can be investigated by the Attorney General and if, after investigation, the Attorney General finds a violation, the office may bring suit against the pharmaceutical manufacturer.

Additionally, the new law does not apply to the Arkansas Medicaid Program.

The law goes into effect January 1, 2022.

Prior Iterations

A prior version of the law – not the one passed and made law – would have required any discount provided to an end user be processed before the submission of any claim to a health benefit plan, healthcare payor, pharmacy benefits manager, or any other similar entity. It also required healthcare payors, health benefit plans, and pharmacy benefit managers to process a claim for a covered individual after the pharmaceutical manufacturer discount for the insulin product has been processed.