Pursuant to New York Insurance Law sections 111 and 111-A, the Department of Financial Services (DFS) is authorized to investigate certain prescription drug price spikes and to require drug manufacturers to report certain drug price increases.

• Section 111: Investigation by the superintendent with respect to prescription drugs (NYSenate.gov)
• Section 111-A:  Notification of prescription drug price increases by manufacturers (NYSenate.gov)

DFS is also advised by a Drug Accountability Board - a panel of experts appointed by the Superintendent and charged with making determinations about drug pricing and reporting to the Superintendent on those determinations.

Pursuant to New York State Insurance Law section 111-A(b), a prescription drug manufacturer is required to report drug price increases to DFS when the price increase meets the following criteria:

• When the prescription drug’s wholesale acquisition cost (WAC) is more than $40 for a course of therapy, and
• The prescription drug’s WAC price increase is more than 16% percent, or
• The cumulative WAC increases, including the current reported increase, within the previous 24 months is more than 16%.

When these criteria are met, the drug manufacturer must notify DFS of the price increase 60 days prior to the effective date of the increase. These price increases will be posted within five days of receipt of the notification.

The law only applies to manufacturer of a prescription drug that is purchased or reimbursed in New York by insurance companies and pharmacy benefit managers as outlined in Section 111-A.

Only increases that take place 60 days after June 19, 2024, and going forward, must be reported.

Penalties

Pursuant to New York Insurance Law Section 111-A (b)(ii)(5), the superintendent is authorized to impose certain penalties, after notice and a hearing, up to five thousand dollars per day for every day after the required reporting period that the information is not reported.

60-day Requirement

If your submission is past the 60-day requirement, submit the report as you normally would. When you are asked if the effective date of the increase is less than 60 days from the reporting date, select “Yes” from the dropdown menu and explain why the submission is late.

Course of Therapy: A course of therapy is defined as either of the following: (i)the recommended daily dosage units of a prescription drug pursuant to its prescribing label as approved by the federal Food and Drug Administration for 30 days; or(ii)the recommended daily dosage units of a prescription drug pursuant to its prescribing label as approved by the federal Food and Drug Administration for a normal course of treatment that is less than 30 days.

National Drug Code: National drug code refers to a three-segment code maintained by the federal Food and Drug Administration that includes a labeler code, a product code, and a package code for a drug product. The code is an 11-digit format consisting of five digits in the first segment, four digits in the second segment, and two digits in the third segment. A three-segment code shall be considered converted to an 11-digit format when, as necessary, at least one “0” has been added to the front of each segment containing less than the specified amount of digits such that each segment contains the specified amount of digits. 

Prescription Drug: means a drug as defined by Section 321 of Title 21 of the United States Code, or a biological product as defined in Section 262(i)(1) of Title 42 of the United States Code that (1) is intended for human use; (2) is not a device within the meaning of section 321(h) of Title 21 of the United States Code; (3) by federal or state law, can be lawfully dispensed only on prescription by a licensed healthcare professional; and (4) is purchased or reimbursed by and entity described in New York Insurance Law Section 111-A (a) (1) (2).

Manufacturers must submit all required information using the DFS online Drug Price Increase Reporting Form.

To get started, visit our Drug Price Increase Reporting Form:

Drug Price Increase Reporting Form

Does the law cover all prescription drugs?

No, the law only applies to a prescription drug that is purchased or reimbursed in New York by insurance companies and pharmacy benefit managers as outlined in Section 111-A.

Do I have to submit a report if a prescription drug increased by 16% 60 days prior to June 19, 2024?

No. Only increases that take place 60 days after June 19, 2024, and going forward must be reported.

Price increases will be posted to the public, will I have access to that information?

Yes, all price increases that meet the criteria set forth in Section 111-A(b) of the New York Insurance Law will be posted to this website five days after the receipt of said price increase.

What happens if I do not submit a qualifying price increase 60 days prior to the effective date of the increase?

Pursuant to New York Insurance Law Section 111-A (b)(ii)(5), the superintendent is authorized to impose certain penalties, after notice and a hearing, up to five thousand dollars per day for every day after the required reporting period that the information is not reported.

What should I do if my submission is past the 60-day requirement?

If your submission is past the 60-day requirement, submit the report as you normally would. When you are asked if the effective date of the increase is less than 60 days from the reporting date, select “Yes” from the dropdown menu and explain why the submission is late.

Manufacturers looking for technical help with the Drug Price Increase Reporting Form should contact the DFS Webmaster.

Drug Manufacturers with questions about reporting requirements should email [email protected].