APPLYING THE MEDICAID ADDITIONAL REBATE REQUIREMENT TO GENERIC DRUGS.

SEC. 602. APPLYING THE MEDICAID ADDITIONAL REBATE REQUIREMENT TO GENERIC DRUGS. (a) In general.—Section 1927(c)(3) of the Social Security Act (42 U.S.C. 1396r-8(c)(3)) is amended— (1) in subparagraph (A), by striking “The amount” and inserting “Except as provided in subparagraph (C), the amount”; and (2) by adding at the end the following new subparagraph: “(C) Additional rebate.— “(i) In general.—The amount of the rebate specified in this paragraph for a rebate period, with respect to each dosage form and strength of a covered outpatient drug other than a single source drug or an innovator multiple source drug of a manufacturer, shall be increased in the manner that the rebate for a dosage form and strength of a single source drug or an innovator multiple source drug is increased under subparagraphs (A) and (D) of paragraph (2), except as provided in clause (ii). “(ii) Special rules for application of provision.—In applying subparagraphs (A) and (D) of paragraph (2) under clause (i)— “(I) the reference in subparagraph (A)(i) of such paragraph to ‘1990’ shall be deemed a reference to ‘2014’; “(II) subject to clause (iii), the reference in subparagraph (A)(ii) of such paragraph to ‘the calendar quarter beginning July 1, 1990’ shall be deemed a reference to ‘the calendar quarter beginning July 1, 2014’; and “(III) subject to clause (iii), the reference in subparagraph (A)(ii) of such paragraph to ‘September 1990’ shall be deemed a reference to ‘September 2014’; “(IV) the references in subparagraph (D) of such paragraph to ‘paragraph (1)(A)(ii)’, ‘this paragraph’, and ‘December 31, 2009’ shall be deemed references to ‘subparagraph (A)’, ‘this subparagraph’, and ‘December 31, 2014’, respectively; and “(V) any reference in such paragraph to a ‘single source drug or an innovator multiple source drug’ shall be deemed to be a reference to a drug to which clause (i) applies. “(iii) Special rule for certain noninnovator multiple source drugs.—In applying paragraph (2)(A)(ii)(II) under clause (i) with respect to a covered outpatient drug that is first marketed as a drug other than a single source drug or an innovator multiple source drug after April 1, 2013, such paragraph shall be applied— “(I) by substituting ‘the applicable quarter’ for ‘the calendar quarter beginning July 1, 1990’; and “(II) by substituting ‘the last month in such applicable quarter’ for ‘September 1990’. “(iv) Applicable quarter defined.—In this subsection, the term ‘applicable quarter’ means, with respect to a drug described in clause (iii), the fifth full calendar quarter after which the drug is marketed as a drug other than a single source drug or an innovator multiple source drug.” . (b) [42 U.S.C. 1396r-8] Effective Date.—The amendments made by subsection (a) shall apply to rebate periods beginning after the date that is one year after the date of the enactment of this Act.