S. 1987Senate116th Congress (2019-2021)In Committee

End Price Gouging for Medications Act

Introduced June 26, 2019

AI-Generated Summary

Updated April 14, 2026 at 6:39 AM UTC

The End Price Gouging for Medications Act would require the Secretary of Health and Human Services to set yearly reference prices for all prescription drugs, using median prices from a set of foreign countries or, when data are lacking, a value‑based calculation. Federal health programs such as Medicare, Medicaid, and the VA would be required to pay no more than these reference prices, and manufacturers would have to offer the same price to all other buyers. Companies that charge higher prices would be fined heavily, with penalties directed to the NIH for drug research.

Key Provisions

  • The HHS Secretary must set an annual “reference price” for every prescription drug.
  • If price data exist for at least three of eleven foreign reference countries (Japan, Germany, UK, France, Italy, Canada, Australia, Spain, the Netherlands, Switzerland, Sweden), the reference price is the median retail list price in those countries; otherwise the Secretary determines a price based on therapeutic benefit, value, patient access, R&D costs, and other factors.
  • For all federal health programs—including Medicare, Medicaid, CHIP, TRICARE, VA health care, Federal Employees Health Benefits, and Indian Health programs—the drug’s retail list price cannot exceed the reference price.
  • Drug makers must also sell the drug at the reference price to anyone else, including privately insured or uninsured patients, as long as the total cost to the patient (insurance payment plus out‑of‑pocket share) does not exceed the reference price.
  • Manufacturers who charge more than the reference price face a civil penalty equal to five times the amount of the overcharge for each drug each year; the collected penalties are sent to the NIH to fund drug research.
  • The reference‑price rule applies to both brand‑name and generic drugs approved under the Food, Drug, and Cosmetic Act or the Public Health Service Act.

Legislative Activity

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1 earlier action
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Health, Education, Labor, and Pensions. (Sponsor introductory remarks on measure: CR S4569-4570)

June 26, 2019

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SenateIntro Referral

Introduced in Senate

June 26, 2019

SenateIntro Referral

Read twice and referred to the Committee on Health, Education, Labor, and Pensions. (Sponsor introductory remarks on measure: CR S4569-4570)

June 26, 2019

Floor Debate

23 members

What members said about S. 1987 on the floor

12 Republicans11 Democrats
Richard J. Durbin
Sen. Richard J. DurbinD-IL · Jun 26, 2019

I announce that the Senator from Colorado (Mr. Bennet), the Senator from New Jersey (Mr. Booker), the Senator from New York (Mrs. Gillibrand), the Senator from California (Ms. Harris), the Senator…

Robert P. Casey Jr.
Sen. Robert P. Casey Jr.D-PA · Jun 26, 2019

Mr. President, I ask unanimous consent to speak as in morning business. Mr. President, I rise this evening to speak about the horrific humanitarian crisis at our southern border--the inhumane and…

Christopher Murphy
Sen. Christopher MurphyD-CT · Jun 26, 2019

Mr. President, I ask unanimous consent that the order of the quorum call be rescinded. Mr. President, on July 9, the Trump administration will be in court defending the Texas v. United States…

Patrick J. Leahy
Sen. Patrick J. LeahyD-VT · Jun 26, 2019

Mr. President, last week, Democrats and Republicans on the Senate Appropriations Committee came together and we approved by a vote of 30 to 1 an emergency supplemental to address the most urgent…

Rob Portman
Sen. Rob PortmanR-OH · Jun 26, 2019

Madam President, I would like to speak about the legislation that is before us right now on the floor. It is the annual National Defense Authorization Act, incredibly important legislation that the…

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James Lankford
Sen. James LankfordR-OK · Jun 26, 2019

Mr. President, I want to rise today to speak to the Senate and compliment two of my colleagues, Senator Jim Inhofe from my State of Oklahoma, my senior Senator, and Senator Jack Reed, for their…

Dan Sullivan
Sen. Dan SullivanR-AK · Jun 26, 2019

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded. Mr. President, it is Wednesday. Now, normally it is Thursday when I come down here to talk about somebody who…

Patrick J. Toomey
Sen. Patrick J. ToomeyR-PA · Jun 26, 2019

Mr. President, I come to the floor this evening to offer an amendment about the opioid addiction crisis that is devastating our Nation. The origins of this epidemic are no doubt complicated, but…

Roy Blunt
Sen. Roy BluntR-MO · Jun 26, 2019

Mr. President, I want to talk a little bit about a bill we should pass this week--I believe we will pass this week--for the 59th straight year. There are very few things we authorize every…

Jeff Merkley
Sen. Jeff MerkleyD-OR · Jun 26, 2019

Mr. President, the three most important words of our Constitution are the first three: ``We the People.'' That is what our entire vision of our form of government is about. There was a lot of…

Jeff Merkley
Sen. Jeff MerkleyD-OR · Jun 26, 2019

Mr. President, the three most important words of our Constitution are the first three: ``We the People.'' That is what our entire vision of our form of government is about. There was a lot of…

Roger F. Wicker
Sen. Roger F. WickerR-MS · Jun 26, 2019

Mr. President, I hope we will vote later on today to advance the NDAA, the National Defense Authorization Act. Members who have been around here a long time realize what a bipartisan tradition this…

Rand Paul
Sen. Rand PaulR-KY · Jun 26, 2019

Mr. President, today we will consider funding to address the humanitarian crisis on the border. The spending bill will be $4 billion. While there is a humanitarian crisis at the border, we also have…

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John Barrasso
Sen. John BarrassoR-WY · Jun 26, 2019

Mr. President, I am here to address the specific topic about energy laws, but hearing my friend and colleague from Connecticut talk about the healthcare law, I would just point out that as 20…

Shelley Moore Capito
Sen. Shelley Moore CapitoR-WV · Jun 26, 2019

Mr. President, I rise to address two very important bills that are before the Senate this week--the National Defense Authorization Act and the border supplemental appropriations bill. First, on the…

Mazie K. Hirono
Sen. Mazie K. HironoD-HI · Jun 26, 2019

Madam President, I ask unanimous consent that the order for the quorum call be rescinded. Madam President, Donald Trump and the hawks in his administration are fueling a dangerous escalation with…

Richard C. Shelby
Sen. Richard C. ShelbyR-AL · Jun 26, 2019

Mr. President, I believe there is no longer any question that the situation along our southern border has become a full-blown humanitarian and security crisis. I think that is a given. Leader…

Debbie Stabenow
Sen. Debbie StabenowD-MI · Jun 26, 2019

Madam President, I rise today to pay tribute to my longtime staff member and friend, Bill Sweeney, who will be moving on to a new challenge in his career after nearly 20 years of service on my team.…

Robert Menendez
Sen. Robert MenendezD-NJ · Jun 26, 2019

Mr. President, reserving the right to object, I agree with the Senator from Pennsylvania that we need to fight the opioid epidemic from every angle. The trafficking of this drug fentanyl coming into…

Benjamin L. Cardin
Sen. Benjamin L. CardinD-MD · Jun 26, 2019

Mr. President, this administration is in crisis when it comes to border security. John Sanders, the acting head of U.S. Customs and Border Protection, resigned yesterday as a result of the growing…

Ron Wyden
Sen. Ron WydenD-OR · Jun 26, 2019

Mr. President, today I am introducing the Wildfire Smoke Relief Act of 2019 with the ultimate goal of providing Federal emergency assistance to at risk individuals in areas with unhealthy air quality…

Charles E. Schumer
Sen. Charles E. SchumerD-NY · Jun 26, 2019

Mr. President, I ask unanimous consent to address the Senate briefly on leader time. Mr. President, the bill that was before us has failed. Most of us on this side of the aisle would have much…

James M. Inhofe
Sen. James M. InhofeR-OK · Jun 26, 2019

Mr. President, I ask unanimous consent that notwithstanding rule XXII, the cloture vote on Senate amendment No. 764 occur at 12 noon on Thursday, June 27; further, that if cloture is invoked,…

Lindsey Graham
Sen. Lindsey GrahamR-SC · Jun 26, 2019

Mr. President, I am going to move to table this amendment. Being the chairman of the Foreign Operations Subcommittee, this is taking one disaster and creating 100 in its place. This $4.6 billion will…

Bill Text

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Introduced in SenateIssued June 26, 2019

II

116th CONGRESS

1st Session

S. 1987

IN THE SENATE OF THE UNITED STATES

June 26, 2019

Mr. Merkley introduced the following bill; which was read twice and referred to the Committee on Health, Education, Labor, and Pensions

A BILL

To require the Secretary of Health and Human Services to establish reference prices for prescription drugs for purposes of Federal health programs, and for other purposes.

1.

Short title

This Act may be cited as the End Price Gouging for Medications Act.

2.

Reference prices for prescription drugs

(a)

Reference prices

The Secretary of Health and Human Services (referred to in this section as the Secretary), in accordance with subsection (b), shall establish annual reference prices for each prescription drug. Notwithstanding any other provision of law, with respect to enrollees or beneficiaries in any of the Federal health programs described in subsection (c), the retail list price for a drug shall not exceed the reference price for such drug.

(b)

Criteria

(1)

In general

Each year, the Secretary shall establish the reference price for each prescription drug under subsection (a)—

(A)

by determining the median retail list price for the drug among the reference countries in which the drug is available, if drug pricing information is available for at least 3 of such countries; or

(B)

in the case of a drug for which drug pricing information or dosage equivalents are not available for at least 3 of the reference countries, by determining an appropriate price based on the Secretary's determination of—

(i)

the added therapeutic effect of the drug;

(ii)

the value of the drug;

(iii)

patient access to the drug;

(iv)

the costs associated with researching and developing the drug; and

(v)

other factors, as the Secretary determines appropriate.

(2)

Reference countries

For purposes of paragraph (1), the reference countries are Japan, Germany, the United Kingdom, France, Italy, Canada, Australia, Spain, the Netherlands, Switzerland, and Sweden.

(c)

Federal health programs

The reference prices established under subsection (a) shall apply with respect to covered inpatient and outpatient drugs under—

(1)

the Medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.);

(2)

a State Medicaid plan under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.);

(3)

the State Children's Health Insurance Program under title XXI of the Social Security Act (42 U.S.C. 1397aa et seq.);

(4)

the TRICARE program under chapter 55 of title 10, United States Code;

(5)

hospital care and medical services furnished by the Department of Veterans Affairs under chapters 17 and 18 of title 38, United States Code;

(6)

the Federal Employees Health Benefits Program established under chapter 89 of title 5, United States Code; and

(7)

any health program, service, function, activity, or facility funded, in whole or part, under the Indian Health Care Improvement Act (25 U.S.C. 1601 et seq.), including through direct or contract care provided under such Act or through a contract or compact under the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304 et seq.).

(d)

Applicability to other purchasers of drugs

Notwithstanding any other provision of law, a drug manufacturer shall offer prescription drugs at the reference price to all individuals, including individuals who are not insured and individuals who are covered under a group health plan or group or individual health insurance coverage. In the case of individuals covered by a group health plan or group or individual health insurance coverage, such requirement is met if the amount covered under such plan or coverage plus the cost-sharing amount does not exceed the reference price.

(e)

Enforcement

(1)

Civil penalty

A drug manufacturer who does not comply with the requirements of subsection (a) shall be subject to a civil penalty, for each year in which the violation occurs and with respect to each drug for which the violation occurs, in an amount equal to 5 times the difference between—

(A)

the total amount received by the manufacturer for sales of the drug under the Federal health programs under subsection (c) for the year; less

(B)

the total amount the manufacturer would have received for sales of the drug under such programs for the year if the manufacturer had complied with subsection (a).

(2)

Amounts collected

Each year, the Secretary of the Treasury shall transfer to the Director of the National Institutes of Health an amount equal to the amount collected in civil penalties under subsection (e) for the previous year. The Director of the National Institutes of Health shall use amounts so transferred for purposes of conducting drug research and development.

(f)

Applicability to brand and generic drugs

The reference price established under subsection (a) shall apply to drugs approved under subsection (c) or (j) of section 505 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) or under subsection (a) or (k) of section 351 of the Public Health Service Act (42 U.S.C. 262).