CA Health & Safety Code Section 130501

For purposes of this division, the following definitions shall apply:

(a)

“Average manufacturer’s price” has the same meaning as this term is defined in Section 1927(k)(1) of the federal Social Security Act (42 U.S.C. Sec. 1396r-8(k)(1)).

(b)

“Department” means the State Department of Health Care Services.

(c)

“Eligible Californian” means a resident of the state who meets any one or more of the following:

(1)

Has total unreimbursed medical expenses equal to at least 10 percent of his or her family’s income where the family’s income does not exceed the state median family income.

(2)

To the extent allowed by federal law, is enrolled in the Medicare Program, but whose prescription drugs are not covered by the Medicare Program.

(3)

Has a family income that does not exceed 300 percent of the federal poverty guidelines and who does not have outpatient prescription drug coverage paid for by any one of the following:

(A)

In whole by the Medi-Cal program.

(B)

In whole or in part by the Healthy Families Program or other programs funded by the state.

(C)

In whole or in part by another third-party payer, provided that the individual has not reached the annual limit on his or her prescription drug coverage.

(4)

For purposes of this subdivision, the cost of drugs provided under this division is considered an expense incurred by the family for eligibility determination purposes.

(d)

“Fund” means the California Discount Prescription Drug Program Fund.

(e)

“Manufacturer” means a drug manufacturer as defined in Section 4033 of the Business and Professions Code.

(f)

“Manufacturer’s rebate” means the rebate for an individual drug or aggregate rebate for a group of drugs necessary to make the price for the drug ingredients equal to or less than the applicable benchmark price.

(g)

“Medicaid best price” has the same meaning as this term is defined in Section 1927(c)(1)(C) of the Social Security Act (42 U.S.C. Sec. 1396r-8(c)(1)(C)).

(h)

“Multiple-source drug” has the same meaning as this term is defined in Section 1927(k)(7) of the Social Security Act (42 U.S.C. Sec. 1396r-8(k)(7)).

(i)

“National drug code” or “NDC” means the unique 10-digit, three-segment number assigned to each drug product listed under Section 510 of the federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 360). This number identifies the labeler or vendor, product, and trade package.

(j)

“National sales data” means prescription data obtained from a national-level prescription tracking service.

(k)

“Participating manufacturer” means a drug manufacturer that has contracted with the department to provide an individual drug or group of drugs for the program.

(l)

“Participating pharmacy” means a pharmacy that has executed a pharmacy provider agreement with the department for this program.

(m)

“Pharmacy contract rate” means the negotiated per prescription reimbursement rate for drugs dispensed to eligible Californians. The department shall establish a single, basic pharmacy rate, but may contract at different rates with pharmacies in order to provide access throughout the state.

(n)

“Prescription drug” means any drug that bears the legend: “Caution: federal law prohibits dispensing without prescription,” “℞ only,” or words of similar import.

(o)

“Private discount drug program” means a prescription drug discount card or manufacturer patient assistance program that provides discounted or free drugs to eligible individuals. For the purposes of this division, a private discount drug program is not considered insurance or a third-party-payer program.

(p)

“Program” means the California Discount Prescription Drug Program.

(q)

“Single-source drug” has the same meaning as this term and the term innovator multiple-source drug are defined in Section 1927(k)(7) of the Social Security Act (42 U.S.C. Sec. 1396r-8(k)(7)).

(r)

“Therapeutic category” means a drug or a grouping of drugs determined by the department to have similar attributes and to be alternatives for the treatment of a specific disease or condition.

(s)

“Volume weighted average discount” means the aggregated average discount for the drugs of a manufacturer, weighted by each drug’s percentage of the total prescription volume of that manufacturer’s drugs. For purposes of this calculation, discounts shall include any rebate amounts used to fund program costs pursuant to Section 130542.1. Drugs excluded from contracting by the department, pursuant to subdivision (d) of Section 130506 and in a manner consistent with subdivision (c) of Section 130506, shall be excluded from the calculation of the volume weighted average discount. National sales data shall be used to calculate the volume weighted average discount pursuant to Section 130506. Program utilization data shall be used to calculate the volume weighted average discount pursuant to Section 130507.