Request By:
Richard Ross, Executive Director
Kentucky Board of Pharmacy
1228 U.S. 127 South
Frankfort, Kentucky 40601
Opinion
Opinion By: Frederic J. Cowan, Attorney General; Richard C. Carroll, Assistant Attorney General
In your correspondence to this office, you posed two questions which concern the substitution of a therapeutically equivalent or generic drug in place of the prescribed brand name drug.
The first question concerns an apparent conflict between KRS 217.822(1) and (2), and KRS 217.830. Subsections (1) and (2) of KRS 217.822 provide:
(1) When a pharmacist receives a prescription for a brand name drug which is not listed by a generic name in the nonequivalent drug product formulary prepared by the board he shall select a lower priced therapeutically equivalent drug which he has in stock, unless otherwise instructed by the purchaser or his physician, provided however that if such selection is made, the label on the container of the drug shall show the name of the drug dispensed.
(2) When an equivalent drug product is dispensed in lieu of a brand name drug prescribed, the price of the equivalent drug product dispensed shall be lower in price to the purchaser than the drug product prescribed. (Emphasis added.)
In contrast, KRS 217.830 provides:
Every pharmacy shall post a sign in a location easily seen by patrons at the counter where prescriptions are dispensed stating that: 'This pharmacy is required to dispense the lowest price generic drug in stock which is therapeutically equivalent to the one prescribed for you by your doctor unless you or your doctor do not approve. Ask your pharmacist. ' The printing on the sign shall be in letters not less than one inch in height. (Emphasis added.)
In regard to these two statutory provisions, your question is whether the pharmacist is required to dispense a lower or the lowest priced therapeutically equivalent drug he has in stock for the one prescribed by the treating physician provided such substitution is allowed for by the physician. The resolution of this issue requires the application of several rules of statutory construction followed in Kentucky.
A simple reading of these two statutory provisions reveals a clear conflict over whether a pharmacist is required to dispense a lower or the lowest priced therapeutically equivalent drug in his inventory for the brand name drug listed by the physician on the prescription form. The rule of statutory construction applicable in this type of case is that where a conflict exists between statutes one must try to harmonize the interpretation of the law so as to give effect to both statutes if possible.
Ledford v. Faulkner, Ky., 661 S.W.2d 475 (1983). Unfortunately, these two provisions cannot be "harmonized" since "lowest" by definition includes and is less than "lower."
Therefore, the next applicable principle to be followed is that when two provisions cannot be reconciled the later statute controls.
Butcher v. Adams, 310 Ky. 205, 220 S.W.2d 398 (1949). A brief review of the legislative history of these two statutes reveals that KRS 217.822(1) and (2) was enacted in 1972. However, at that time there was no mention in the statute regarding the dispensing of a lower or the lowest priced generic substitute. In 1976, KRS 217.822(1) was amended so as to require a pharmacist to substitute the lowest priced therapeutically equivalent drug listed by the drug formulary council which he had in stock for the prescribed name brand drug. During the same legislative session, KRS 217.894 was enacted and was substantially similar in nature to the present KRS 217.830. KRS 217.894 required the display of a sign in a pharmacy which informed its customers that the pharmacist was required to dispense the lowest priced generic drug in his stock which was therapeutically equivalent to the one prescribed by the doctor. These statutes were therefore in harmony with each other in that the lowest priced generic drug in stock was to be substituted for the brand name drug listed on the prescription blank unless such substitution was disallowed by the doctor or the patient.
However, in 1982, KRS 217.894, the forerunner of 217.830, was repealed and 217.822 was amended to require that a pharmacist substitute a lower priced therapeutically equivalent drug in his stock for the one prescribed by the treating physician unless otherwise indicated by said physician. Once again, the legislation was consistent in that in all cases it required that a lower not the lowest priced generic must be substituted for the brand name drug. Unfortunately, in 1986, the General Assembly reversed course and created a conflict with 217.822 when it enacted 217.830 which as previously noted states that a pharmacist is to dispense the lowest priced generic drug in his stock. The Legislature is presumed to have been aware of the different standard present in 217.822 when it enacted 217.830. See
Haven Point v. United Kentucky Bank, Ky., 690 S.W.2d 393 (1985) Therefore, this most recent pronouncement by the Legislature is a clear indication that it has chosen to readopt the lowest priced generic drug standard and according to Butcher, supra, is therefore controlling.
In addition, the enactment of KRS 217.830 in essence amended by implication 217.822 insofar as requiring the dispensing of the lowest, as opposed to lower priced, therapeutically equivalent priced drug in a pharmacist's stock. The principle of amendment by implication is applicable to the two statutes at issue since the terms of said statutes are repugnant to each other and irreconcilable. See
Fiscal Court Commissioners, etc. v. Jefferson, etc., Ky. App., 614 S.W.2d 954 (1981). Therefore, it is the opinion of this office that pursuant to KRS 217.830 pharmacists, unless otherwise informed by the physician or the patient, must substitute the lowest priced therapeutically equivalent drug in their stock for the prescribed brand name drug.
The second question you posed involves the method to be used by the prescribing physician to indicate that a therapeutically equivalent drug should not be substituted for the one prescribed. KRS 217.822(3) provides:
If, in the opinion of a practitioner, it is to the best interest of his patient that an equivalent drug should not be dispensed, he may indicate in the manner of his choice on the prescription 'Do Not Substitute,' except that the indication shall not be preprinted on the prescription blank.
The problem which has arisen in regard to this provision is the placement of a box on prescription blanks by many physicians immediately adjacent to the preprinted phrase, "Do Not Substitute." When these physicians do not want to allow a generic substitute for the drug prescribed, he or she simply places a check mark or x in the box and signs his or her name at the bottom of the form. Prior opinions of this office, OAG 76-753 and 77-223, held that such a procedure was allowable so long as the final act on the part of the physician to indicate that the prescribed drug should not be substituted is not preprinted on the prescription blank. A review of those opinions reveals that they were based upon authority and principles which at this time remain sound. Therefore, this office will not reverse those previous opinions. Unfortunately, a number of practical problems have developed with this procedure since the issuance of those opinions.
However, as previously noted, this office is unable, in the application of the present rules of statutory construction, to reverse its prior opinions and disallow the use of the check mark system. Instead, this is a matter which is more properly handled by amending the statute.