106 STAT. 4972 PUBLIC LAW 102-585—NOV. 4, 1992 "(3) with respect to each covered drug of the manufacturer procured by a State home receiving fundb under section 1741 of this title, the price charged may not exceed the price charged under the Federal Supply Schedule at the time the drug is procured; and (4) unless the mcmufacturer meets the requirements of paragraphs (1), (2), and (3), the manufacturer may not receive payment for the purchase of drugs or biologicals from— "(A) a State plan under title XIX of the Social Security Act, except as authorized under section 1927(a)(3) of such Act, "(B) any Federal agency described in subsection (b), or "(C) any entity that receives funds under the Public \ Health Service Act. "(h) The Federal agencies described in this subsection are as follows: "(1) The Department. "(2) The Department of Defense. "(3) The Public Health Service, including the Indian Health Service. "(c) With respect to any covered drug the price of which is determined in accordance with a pharmaceutical pricing agreement entered into pursuant to subsection (a)(2), for calendar quarters beginning on or after January 1, 1993, the manufacturer shall provide a discount in an amount equal to the amount by which the change in non-Federal price exceeds the amount equal to— "(1) the non-Federal average manufacturer price of the drug during the 3-month period that ends one year before the last day of the month preceding the month during which the contract for the covered drug goes into effect (or, in the case of a covered drug for which sufficient data for determining the non-Federal average manufacturer price during such period is not available, during such period preceding the month auring which the contract goes into effect as the Secretary considers appropriate); increased by "(2) the percentage increase in the Consume^ Price Index for all urban consumers (U.S. city average) between the last month of the period described in paragraph (1) and the last month preceding the month during which the contract goes into effect for which Consumer Price Index data is available. "(d) In the case of a covered drug of a manufacturer that has entered into a multi-year contract with the Secretary under subsection (a)(2) for the procurement of the drug— "(1) during any one-year period that follows the first year for which the contract is in effect, the price charged may not exceed the price charged during the preceding one-year period, increased by the percentage mcrease in the Consumer Price Index for all urbem consumers (U.S. city average) between the last months of such one-year periods for which Consumer Price Index data is avedlable; and "(2) in applying subsection (c) to determine the amount of the discount provided with respect to the drug diuing a year that follows the first year for which the contract is in effect, any reference in such subsection to 'the month during which the contract goes into effect' shall be considered a ref- erence to the first month of such following year.
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