Sale price limitations on identified prescription drugs. Penalties for noncompliance. Appeals.
Conn. Gen. Stat. § 12-34g
in effect12-34g. Sale price limitations on identified prescription drugs. Penalties for noncompliance. Appeals.
(a)(1) Notwithstanding any provision of the general statutes and except as provided in subdivision (2) of this subsection, no pharmaceutical manufacturer or wholesale distributor shall, on or after January 1, 2026, sell an identified prescription drug in this state at a price that exceeds the reference price for the identified prescription drug, adjusted for any increase in the consumer price index.
(2) A pharmaceutical manufacturer or wholesale distributor may, on or after January 1, 2026, sell an identified prescription drug in this state at a price that exceeds the reference price for the identified prescription drug, adjusted for any increase in the consumer price index, if the federal Secretary of Health and Human Services determines, pursuant to 21 USC 356e, as amended from time to time, that such identified prescription drug is in shortage in the United States.
(b) (1) Except as provided in subdivision (2) of this subsection, any pharmaceutical manufacturer or wholesale distributor that violates the provisions of subsection (a) of this section shall be liable to this state for a civil penalty. Such civil penalty shall be imposed, calculated and collected on a calendar year basis by the Commissioner of Revenue Services, and the amount of such civil penalty for a calendar year shall be equal to eighty per cent of the difference between:
(A) The revenue that the pharmaceutical manufacturer or wholesale distributor earned from all sales of the identified prescription drug in this state during the calendar year; and
(B) The revenue that the pharmaceutical manufacturer or wholesale distributor would have earned from all sales of the identified prescription drug in this state during the calendar year if the pharmaceutical manufacturer or wholesale distributor had sold such identified prescription drug at a price that did not exceed the reference price for such identified prescription drug, as such reference price is adjusted for any increase in the consumer price index.
(2) No pharmaceutical manufacturer or wholesale distributor of an identified prescription drug shall be liable to this state for the civil penalty imposed under subdivision (1) of this subsection unless the pharmaceutical manufacturer or wholesale distributor made at least two hundred fifty thousand dollars in total annual sales in this state for the calendar year for which such civil penalty would otherwise be imposed.
(c) (1) (A) For calendar years commencing on or after January 1, 2026, each pharmaceutical manufacturer or wholesale distributor that violated the provisions of subsection (a) of this section during any calendar year shall, not later than the first day of March immediately following the end of such calendar year:
(i) Pay to the commissioner the civil penalty imposed under subsection (b) of this section for such calendar year; and
(ii) File with the commissioner a statement for such calendar year in a form and manner, and containing all information, prescribed by the commissioner.
(B) A pharmaceutical manufacturer or wholesale distributor that is required to file the statement and pay the civil penalty pursuant to subparagraph (A) of this subdivision shall electronically file such statement and make such payment by electronic funds transfer in the manner provided by chapter 228g, irrespective of whether the pharmaceutical manufacturer or wholesale distributor would have otherwise been required to electronically file such statement or make such payment by electronic funds transfer under chapter 228g.
(2) If no statement is filed pursuant to subdivision (1) of this subsection, the commissioner may make such statement at any time thereafter, according to the best obtainable information and the prescribed form.
(d) The commissioner may examine the records of any pharmaceutical manufacturer or wholesale distributor that is subject to the civil penalty imposed under subsection (b) of this section as the commissioner deems necessary. If the commissioner determines from such examination that the pharmaceutical manufacturer or wholesale distributor failed to pay the full amount of such civil penalty, the commissioner shall bill such pharmaceutical manufacturer or wholesale distributor for the full amount of such civil penalty.
(e) (1) The commissioner may require each pharmaceutical manufacturer or wholesale distributor that is subject to the civil penalty imposed under subsection (b) of this section to keep such records as the commissioner may prescribe, and produce books, papers, documents and other data to provide or secure information pertinent to the enforcement and collection of such civil penalty.
(2) The commissioner, or the commissioner's authorized representative, may examine the books, papers, records and equipment of any person who is subject to the provisions of this section and may investigate the character of the business of such person to verify the accuracy of any statement made or, if no statement is made by such person, to ascertain and determine the amount of the civil penalty due under subsection (b) of this section.
(f) Any pharmaceutical manufacturer or wholesale distributor that is subject to the civil penalty imposed under subsection (b) of this section and aggrieved by any action of the commissioner under subdivision (2) of subsection (c) of this section or subsection (d) of this section may apply to the commissioner, in writing and not later than sixty days after the notice of such action is delivered or mailed to such pharmaceutical manufacturer or wholesale distributor, for a hearing, setting forth the reasons why such hearing should be granted and if such pharmaceutical manufacturer or wholesale distributor believes that such pharmaceutical manufacturer or wholesale distributor is not liable for such civil penalty or the full amount of such civil penalty, the grounds for such belief and the amount by which such pharmaceutical manufacturer or wholesale distributor believes such civil penalty should be reduced. The commissioner shall promptly consider each such application and may grant or deny the hearing requested. If the hearing request is denied, the commissioner shall immediately notify the pharmaceutical manufacturer or wholesale distributor. If the hearing request is granted, the commissioner shall notify the pharmaceutical manufacturer or wholesale distributor of the date, time and place for such hearing. After such hearing, the commissioner may make such order as appears just and lawful to the commissioner and shall furnish a copy of such order to the pharmaceutical manufacturer or wholesale distributor. The commissioner may, by notice in writing, order a hearing on the commissioner's own initiative and require a pharmaceutical manufacturer or wholesale distributor, or any other person who the commissioner believes to be in possession of relevant information concerning such pharmaceutical manufacturer or wholesale distributor, to appear before the commissioner or the commissioner's authorized agent with any specified books of account, papers or other documents for examination under oath.
(g) Any pharmaceutical manufacturer or wholesale distributor that is aggrieved by any order, decision, determination or disallowance of the commissioner made under subsection (f) of this section may, not later than thirty days after service of notice of such order, decision, determination or disallowance, take an appeal therefrom to the superior court for the judicial district of New Britain, which appeal shall be accompanied by a citation to the commissioner to appear before said court. Such citation shall be signed by the same authority and such appeal shall be returnable at the same time and served and returned in the same manner as is required in case of a summons in a civil action. The authority issuing the citation shall take from the appellant a bond or recognizance to this state, with surety, to prosecute the appeal to effect and to comply with the orders and decrees of the court. Such appeals shall be preferred cases, to be heard, unless cause appears to the contrary, at the first session, by the court or by a committee appointed by the court. Said court may grant such relief as may be equitable and, if the civil penalty was paid prior to the granting of such relief, may order the Treasurer to pay the amount of such relief. If the appeal was taken without probable cause, the court may tax double or triple costs, as the case demands and, upon all such appeals that are denied, costs may be taxed against such pharmaceutical manufacturer or wholesale distributor at the discretion of the court but no costs shall be taxed against this state.
(h) The commissioner, and any agent of the commissioner duly authorized to conduct any inquiry, investigation or hearing pursuant to this section, shall have power to administer oaths and take testimony under oath relative to the matter of inquiry or investigation. At any hearing ordered by the commissioner, the commissioner, or the commissioner's agent authorized to conduct such hearing and having authority by law to issue such process, may subpoena witnesses and require the production of books, papers and documents pertinent to such inquiry or investigation. No witness under any subpoena authorized to be issued under the provisions of this section shall be excused from testifying or from producing books, papers or documentary evidence on the ground that such testimony or the production of such books, papers or documentary evidence would tend to incriminate such witness, but such books, papers or documentary evidence so produced shall not be used in any criminal proceeding against such witness. If any person disobeys such process or, having appeared in obedience thereto, refuses to answer any pertinent question put to such person by the commissioner, or the commissioner's authorized agent, or to produce any books, papers or other documentary evidence pursuant thereto, the commissioner, or such agent, may apply to the superior court of the judicial district wherein the pharmaceutical manufacturer or wholesale distributor resides or wherein the business was conducted, or to any judge of such court if the same is not in session, setting forth such disobedience to process or refusal to answer, and such court or such judge shall cite such person to appear before such court or such judge to answer such question or to produce such books, papers or other documentary evidence and, upon such person's refusal to do so, shall commit such person to a community correctional center until such person testifies, but not for a period longer than sixty days. Notwithstanding the serving of the term of such commitment by any person, the commissioner may proceed in all respects with such inquiry and examination as if the witness had not previously been called upon to testify. Officers who serve subpoenas issued by the commissioner or under the commissioner's authority and witnesses attending hearings conducted by the commissioner pursuant to this section shall receive fees and compensation at the same rates as officers and witnesses in the courts of this state, to be paid on vouchers of the commissioner on order of the Comptroller from the proper appropriation for the administration of this section.
(i) The amount of any civil penalty unpaid under the provisions of this section may be collected under the provisions of section 12-35. The warrant provided under section 12-35 shall be signed by the commissioner or the commissioner's authorized agent. The amount of any such civil penalty shall be a lien on the real property of the pharmaceutical manufacturer or wholesale distributor from the last day of the month next preceding the due date of such civil penalty until such civil penalty is paid. The commissioner may record such lien in the records of any town in which the real property of such pharmaceutical manufacturer or wholesale distributor is situated, but no such lien shall be enforceable against a bona fide purchaser or qualified encumbrancer of such real property. When any civil penalty with respect to which a lien was recorded under the provisions of this subsection is satisfied, the commissioner shall, upon request of any interested party, issue a certificate discharging such lien, which certificate shall be recorded in the same office in which such lien was recorded. Any action for the foreclosure of such lien shall be brought by the Attorney General in the name of this state in the superior court for the judicial district in which the real property subject to such lien is situated, or, if such property is located in two or more judicial districts, in the superior court for any one such judicial district, and the court may limit the time for redemption or order the sale of such real property or make such other or further decree as the court judges equitable. The provisions of section 12-39g shall apply to all civil penalties imposed under this section.
(j) (1) Any officer or employee of a pharmaceutical manufacturer or wholesale distributor, who owes a duty to the pharmaceutical manufacturer or wholesale distributor to pay the civil penalty imposed under subsection (b) of this section on behalf of such pharmaceutical manufacturer or wholesale distributor, shall file a statement with the commissioner pursuant to subsection (c) of this section on behalf of such pharmaceutical manufacturer or wholesale distributor and keep records or supply information to the commissioner on behalf of such pharmaceutical manufacturer or wholesale distributor pursuant to this section. Any such officer or employee who wilfully fails, at the time required under this section, to pay such civil penalty, file such statement, keep such records or supply such information on behalf of such pharmaceutical manufacturer or wholesale distributor shall, in addition to any other penalty provided by law, be fined not more than one thousand dollars or imprisoned not more than one year, or both. Notwithstanding the provisions of section 54-193, no such officer or employee shall be prosecuted for a violation of the provisions of this subdivision committed on or after January 1, 2026, except within three years next after such violation is committed.
(2) Any officer or employee of a pharmaceutical manufacturer or wholesale distributor, who owes a duty to the pharmaceutical manufacturer or wholesale distributor to deliver or disclose to the commissioner, or the commissioner's authorized agent, any list, statement, return, account statement or other document on behalf of such pharmaceutical manufacturer or wholesale distributor, and who wilfully delivers or discloses to the commissioner, or the commissioner's authorized agent, any such list, statement, return, account statement or other document that such officer or employee knows to be fraudulent or false in any material matter shall, in addition to any other penalty provided by law, be guilty of a class D felony.
(3) No officer or employee of a pharmaceutical manufacturer or wholesale distributor shall be charged with an offense under both subdivisions (1) and (2) of this subsection in relation to the same civil penalty, but such officer or employee may be charged and prosecuted for both such offenses upon the same information.
(k) Each civil penalty imposed under subsection (b) of this section shall be deemed to constitute a civil fine or penalty within the meaning of 42 USC 1396b(w), as amended from time to time. No portion of any civil penalty imposed under subsection (b) of this section shall be waived under section 12-3a or any other applicable law. No tax credit shall be allowable against any civil penalty imposed under subsection (b) of this section.
(l) Not later than July 1, 2027, and annually thereafter, the commissioner shall prepare a list containing the name of each pharmaceutical manufacturer or wholesale distributor that violated subsection (a) of this section during the preceding calendar year. The commissioner shall make each such list publicly available.
(m) The commissioner may adopt regulations, in accordance with the provisions of chapter 54, to implement the provisions of this section.
(P.A. 25-168, S. 346.)
History: P.A. 25-168 effective July 1, 2025.
Source: Connecticut General Assembly (cga.ct.gov)URL: https://www.cga.ct.gov/2026/sup/chap_201.htm#sec_12-34gFetched: 10/20/2026