(a) In this section, “Maryland Rx Program” means a purchasing pool for pharmacy benefits that meets the requirements of this section.

(b) The Department shall establish a Maryland Rx Program to achieve savings on the cost of prescription drugs for:

(1) the State Employee and Retiree Health and Welfare Benefits Program; and

(2) any local government or other entity identified under this subtitle that satisfies the conditions for participation established by the Department.

(c) The Maryland Rx Program shall seek savings through:

(1) a preferred list of covered prescription drugs;

(2) rebates from drug manufacturers;

(3) negotiated discounts; and

(4) other cost-saving measures.

(d) (1) Each entity that participates in the Maryland Rx Program shall be responsible for the cost of drugs purchased by or on behalf of the entity.

(2) The cost of drugs purchased by or on behalf of the State Employee and Retiree Health and Welfare Benefits Program shall be paid in accordance with the State budget and the provisions of this subtitle.

(e) The State may:

(1) provide start-up funds for the Maryland Rx Program; and

(2) recoup any start-up funds from savings achieved for participating entities through the Maryland Rx Program.

(f) The Department may charge an administrative fee to an entity sufficient to offset the administrative costs resulting from the entity’s participation in the Maryland Rx Program.

(g) The Department shall use a reverse auction, as provided for in § 2-502.2 of this subtitle, to select a pharmacy benefit manager or other entity to administer the Maryland Rx Program.

(h) The Department shall adopt regulations to implement this section.