Section 3761-704 - Terms of rebate agreement(a) Quarterly basis.--A rebate agreement shall require any manufacturer of covered prescription drugs to provide to the department a rebate each calendar quarter in an amount specified in section 705 for covered prescription drugs of the manufacturer reimbursed during the quarter. The rebate shall be paid by the manufacturer not later than 30 days after the date of receipt of the information described in subsection (b) for the period involved.(b) Information.--(1) The department shall report to each manufacturer, not later than 60 days after the end of each calendar quarter, information by zip code of provider on the total number of dosage units of each covered prescription drug reimbursed under PACE, PACENET and designated pharmaceutical programs during the quarter.(2) A manufacturer may review the information provided under paragraph (1) and verify information. Adjustments to rebates shall be made to the extent that information indicates that utilization was greater or less than the amount previously specified.(3) In the event that in any quarter a material discrepancy in the department's information is certified by the manufacturer prior to the due date of the rebate, the department and the manufacturer shall, in good faith, attempt to resolve the discrepancy. If resolution is not reached within 30 days of receipt of the manufacturer's certification by the department, the manufacturer may appeal the department's decision under the department's formal fair hearings and appeals process. The manufacturer shall pay the department that portion of the rebate amount which is not disputed within the required time frame under this chapter. Any balance due, plus statutory interest, shall be paid or credited by the manufacturer or the department by the due date of the next quarterly payment after resolution of the dispute.(c) Manufacturer provision of price information.--(1) Each manufacturer with an agreement in effect under this chapter shall report the average manufacturer price and the best price for all covered prescription drugs produced by that manufacturer to the department not later than 30 days after the last day of each quarter.(2) The department shall retain the services of an independent contractor to survey wholesalers, direct sellers and manufacturers that directly distribute their covered prescription drugs, when necessary, to verify manufacturer prices reported under paragraph (1). Any survey conducted shall not reveal to the department nor to any other person or entity other than the independent contractor the name, identity, location, actual acquisition invoice, other proprietary information or any information from which the department might be enabled to ascertain the name, identity or location of any wholesaler, direct seller or provider so surveyed unless the contractor shall have gathered sufficient evidence to enable the department to bring charges against any wholesaler, direct seller or provider in violation of subsection (d)(3).(d) Penalties.--The department shall administer penalties as follows: (1) A manufacturer who fails to supply information required under subsection (c)(1) shall be liable for a civil penalty in the amount of 2% of the rebate next required to be paid, plus $1,000 for each day that the information is late. If the information is not reported within 30 days of the due date, the agreement shall be suspended for services furnished after the end of the 30-day period until the date the information is reported or the expiration of 45 days, whichever is later.(2) A manufacturer who knowingly supplies false information that is required under subsection (c)(1) shall be liable for a civil penalty in the amount of $50,000 for each item of false information.(3) A direct seller, manufacturer or wholesaler who refuses a request for information or knowingly provides false information that is required under subsection (c)(2) shall be liable for a civil penalty in the amount of $50,000.(4) Penalties collected under this subsection shall be deposited into the fund.(5) All civil monetary penalties imposed under this chapter are in addition to other civil or criminal penalties.(e) Confidentiality of information.--Information disclosed by manufacturers, wholesalers or direct sellers under this chapter is confidential and shall not be disclosed by the department in a form which discloses the identity of a specific manufacturer, wholesaler or direct seller or the prices charged for drugs by the manufacturer or wholesaler, except as the department determines to be necessary to carry out this chapter and to permit the Department of the Auditor General and the Office of State Inspector General to review the information provided.(f) Length of agreement.--A rebate agreement shall remain in effect for an initial period of not less than one year and shall be automatically renewed for a period of not less than one year unless terminated under subsection (g).(g) Termination.--(1) The department may provide for termination of a rebate agreement for any reason. Termination shall not be effective earlier than 60 days after the date of receipt of notice of termination by the manufacturers.(2) A manufacturer may terminate a rebate agreement for any reason. Termination shall not be effective earlier than 60 days after the date of receipt of notice of termination by the department.(3) Termination of the rebate agreement shall not affect rebates due under the agreement before the effective date of termination.(4) Commonwealth Court shall have original jurisdiction over cases of termination of agreements under this subsection. Commencement of an action under this paragraph shall not delay the effective date of termination.(5) If a rebate agreement is terminated for cause, another agreement with the same manufacturer or a successor manufacturer may not be entered into until a period of one year has elapsed from the date of the termination unless the department finds good cause for an earlier agreement.1971, Aug. 26, P.L. 351, No. 91, § 704, added 1996, Nov. 21, P.L. 741, No. 134, § 2, imd. effective. Amended 2003, Nov. 26, P.L. 212, No. 37, § 8, imd. effective.