Enact the Ohio-Made Prescription Drug Act

hb892_00_IN

As Introduced

136th
General Assembly

Regular
Session
H. B. No. 892

2025-2026

Representatives Russo, Abdullahi

Cosponsors: Representatives Cockley,
Brennan, Piccolantonio, Synenberg

To
enact section 125.62 of the Revised Code
to
establish the Ohio-Made Medicine Manufacturing Program and to name
this act the Ohio-Made Prescription Drug Act.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
section 125.62 of the Revised Code be enacted to read as follows:

Sec.
125.62.
(A)
As used in this section:

(1)
"Generically equivalent drug" has the same meaning as in
section 3715.01 of the Revised Code.

(2)
"Health plan issuer" has the same meaning as in section
3922.01 of the Revised Code.

(3)
"Hospital" means a facility or institution licensed under
Chapter 3722. of the Revised Code.

(4)
"Pharmacy benefit manager" has the same meaning as in
section 3959.01 of the Revised Code.

(5)
"State retirement systems" has the same meaning as in
section 171.01 of the Revised Code.

(B)
Not later than sixty days after the effective date of this section,
the department of administrative services, department of health, and
department of development shall jointly establish the Ohio-made
medicine manufacturing program. The program shall engage in efforts
to make essential drugs more affordable, including efforts to support
the distribution, manufacture, purchase, or sale of generically
equivalent drugs.

The
program shall be established within the department of administrative
services, with the departments of health and development to provide
the program with expertise in the areas of public health, medical
care, economic development, or business support and with additional
staffing.

(C)
As soon as practicable after the program's establishment, the
directors of administrative services, health, and development shall
jointly appoint an administrator for the program. Subject to
available funds, the administrator may hire staff to assist in the
program's management and oversight.

(1)
Subject to division (D) of this section, and in consultation with
appropriate entities if necessary, the administrator shall enter into
partnerships for the following purposes:

(a)
To increase competition, lower prices, and address shortages in the
market for generically equivalent drugs;

(b)
To reduce drug costs for public and private purchasers, taxpayers,
and consumers;

(c)
To increase access to affordable drugs for patients across this
state;

(d)
To promote and advance the distribution or manufacture of generically
equivalent drugs in this state, when viable and not in conflict with
any purpose described in divisions (C)(1)(a) to (c) of this section.

(2)
The partnerships described in division (C)(1) of this section may
include contractual agreements with payers, state agencies, group
purchasing organizations, nonprofit corporations, or other
third-party entities for the distribution, manufacture, purchase, or
sale of generically equivalent drugs.

(3)
Subject to division (E) of this section, the administrator shall
develop a list of the generically equivalent drugs to be distributed,
manufactured, purchased, or sold through partnerships entered into
under this section.

(4)
Subject to division (F) of this section, the administrator shall set
prices for generically equivalent drugs purchased or sold through
partnerships entered into under this section.

(D)
Before a partnership is entered into for the distribution,
manufacture, purchase, or sale of generically equivalent drugs, all
of the following apply:

(1)
The administrator shall examine relevant legal, market, policy, and
regulatory factors in an effort to determine if viable pathways exist
for partnerships for the distribution, manufacture, purchase, or sale
of generically equivalent drugs.

(2)
In consultation with appropriate entities, the administrator shall
determine minimum thresholds for purchasing a partnering entity's
expected volume of a targeted drug over a multi-year period.

(3)
A partnership shall be entered into only if the administrator and
partnering entity do both of the following:

(a)
Reasonably determine that the partnership will satisfy, rather than
deter, the purposes described in division (C)(1) of this section;

(b)
Maintain records demonstrating the administrator's and entity's
reasonable determination.

(4)
A partnering entity shall be registered with the United States food
and drug administration as an owner or operator of a drug
manufacturing establishment.

(E)
Not later than nine months after the effective date of this section,
the administrator shall develop the list of the generically
equivalent drugs described in division (C)(3) of this section. In
developing the list, all of the following apply:

(1)
The administrator shall consider the generically equivalent drugs
most likely to lower drug costs for patients, increase competition
and address shortages in the prescription drug market, improve public
health, or reduce the cost of prescription drugs for public and
private purchasers.

(2)
The administrator shall prioritize those prescribed to treat chronic
and high-cost health conditions, in particular, those available by
mail order.

(3)
The administrator shall consult with appropriate entities, including
all of the following, to assist in developing the list and
determining the volume of each generically equivalent drugs that can
be distributed, manufactured, purchased, or sold over a multi-year
period in order to support a market for lower-cost drugs:

(a)
The departments of administrative services, aging, health, insurance,
medicaid, rehabilitation and correction, and youth services, the
industrial commission, and the bureau of workers' compensation or any
entities acting on their behalf to purchase drugs;

(b)
The state retirement systems or any entities acting on their behalf
to purchase drugs;

(c)
Health plan issuers;

(d)
Hospitals;

(e)
Pharmacy benefit managers;

(f)
The state board of pharmacy.

(F)
In the case of a partnership that involves the administrator setting
the price of a generically equivalent drug, both of the following
apply:

(1)
The administrator shall consider the following, if applicable, when
setting the drug's price:

(a)
United States food and drug administration user fees;

(b)
Abbreviated new drug application acquisition costs amortized over a
five-year period;

(c)
Any rebates mandated by federal or state law;

(d)
Total contracting and production costs for the drug, including a
reasonable amount for the drug manufacturer's administrative,
operating, and rate-of-return expenses;

(e)
Research and development costs attributed to the drug over a
five-year period;

(f)
Other initial start-up costs amortized over a five-year period.

(2)
Under the program, each drug shall be made available to health care
providers, patients, and purchasers at a transparent price and
without rebates, other than rebates required by federal law, with
priority for in-state providers, patients, and purchasers, should
supply levels necessitate priority purchasing. No person or
governmental entity shall be required to purchase drugs from the
administrator or a partnering entity.

(G)(1)
Not later than the first day of the first September that occurs on or
after the date that is six months after the effective date of this
section and every first day of September thereafter, the
administrator shall prepare and submit to the governor and general
assembly a report that does all of the following:

(a)
Describes the status of the drugs that are the program's focus;

(b)
Analyzes the program's impact on competition, drug availability, and
drug costs, in particular generically equivalent drug costs for
public and private purchasers;

(c)
Recommends and assesses improvements to the program, including those
to ensure that the purposes described in division (C)(1) of this
section are met.

(2)
The first report required by this section shall describe in detail
the plan for administering, managing, and overseeing the program,
including the following:

(a)
An assessment of measures to feasibly achieve program purposes;

(b)
An analysis of governance structure options for manufacturing
functions, including chartering a private organization,
public-private partnership, or public board of directors.

(3)
As generically equivalent drugs are listed as described in division
(E) of this section, each subsequent report shall also include all of
the information required in division (G)(2) of this section.

(H)
To protect proprietary and confidential information regarding
manufacturer or distribution costs and drug pricing, utilization, and
rebates, any information or document that the program or its
administrator and staff obtain in administering this section shall
not be considered a public record under section 149.43 of the Revised
Code.

Section
2.
This
act shall be known as the Ohio-Made Prescription Drug Act.