SECTIONS 14977-14982 - California Statutes

GOVERNMENT CODE

SECTION 14977-14982

14977. As used in this chapter, "department" means the Department
of General Services.

14977.1. (a) Notwithstanding any other provision of law, the
Department of General Services may enter into exclusive or
nonexclusive contracts on a bid or negotiated basis with
manufacturers and suppliers of single source or multisource drugs.
The department may obtain from those manufacturers and suppliers,
discounts, rebates, or refunds based on quantities purchased insofar
as permissible under federal law. Contracts entered into pursuant to
this chapter may include price discounts, rebates, refunds, or other
strategies aimed at managing escalating prescription drug prices.
(b) Contracts under this chapter shall be exempt from Chapter 2
(commencing with Section 10290) of Part 2 of Division 2 of the Public
Contract Code.

14977.5. (a) The following state agencies shall participate in the
prescription drug bulk purchasing program authorized under this
chapter.
(1) State Department of Mental Health.
(2) Department of Corrections.
(3) Department of the Youth Authority.
(4) State Department of Developmental Services.
(b) Any state, district, county, city, municipal, or public agency
governmental entity, other than a state entity specified in
subdivision (a), may elect to participate in the coordinated
purchasing program.

14978. The department, in consultation with the agencies listed in
subdivision (a) of Section 14977.5, may investigate and implement
other options and strategies to achieve the greatest savings on
prescription drugs with prescription drug manufacturers and
wholesalers.

14979. The department may appoint and contract with a
pharmaceutical benefits manager or other entity for purposes of the
prescription drugs purchased under this chapter. The pharmaceutical
benefits manager or other entity may do all of the following:
(a) Negotiate price discounts, rebates, or other options that
achieve the greatest savings on prescription drugs with prescription
drug manufacturers and wholesalers.
(b) Purchase prescription drugs for participating state, district,
county, or municipal governmental entities.
(c) Act as a consultant to the department.

14980. The department may explore additional strategies for
managing the increasing costs of prescription drugs, including:
(a) Coordinating programs offered by pharmaceutical manufacturers
that provide prescription drugs for free or at reduced prices.
(b) Studying the feasibility and appropriateness of including in
the bulk purchasing programs entities in the private sector,
including employers, providers, and individual consumers.
(c) Implementing other strategies, as permitted under state and
federal law, aimed at managing escalating prescription drug prices.

14982. (a) It is the intent of the Legislature that the Department
of General Services, University of California, and the Public
Employees' Retirement System regularly meet and share information
regarding each agency's procurement of prescription drugs in an
effort to identify and implement opportunities for cost savings in
connection with this procurement. It is the intent of the Legislature
that the University of California and the Public Employees'
Retirement System cooperate with the department in order to reduce
each agency's costs for prescription drugs.
(b) The department shall do all of the following:
(1) Share information on a regular basis with the University of
California and the Public Employees' Retirement System regarding each
agency's procurement of prescription drugs, including, but not
limited to, prices paid for the same or similar drugs and information
regarding drug effectiveness.
(2) Identify opportunities for the department, the University of
California, and the Public Employees' Retirement System to
consolidate drug procurement or engage in other joint activities that
will result in cost savings in the procurement of prescription
drugs.
(3) Participate in at least one independent association that
develops information on the relative effectiveness of prescription
drugs.
(4) Develop strategies, in consultation with the affected
agencies, for the state to achieve savings through greater use of
generic drugs.
(5) No later than January 1, 2006, and annually thereafter,
develop a workplan that includes, but is not limited to, a
description of the department's annual activities to reduce the state'
s costs for prescription drugs and an estimate of cost savings.
(c) Nothing in this section shall be construed to require sharing
of information that is prohibited by any other provision of law or
contractual agreement, or the disclosure of information that may
adversely affect potential drug procurement by any state agency.