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136 STAT. 1887 PUBLIC LAW 117–169—AUG. 16, 2022 determined in accordance with section 1860D– 2(b)(4)(C), for covered part D drugs in the year that are equal to or exceed the annual out-of- pocket threshold specified in section 1860D– 2(b)(4)(B)(i) for the year— ‘‘(aa) for 2025, 99 percent; ‘‘(bb) for 2026, 98 percent; ‘‘(cc) for 2027, 95 percent; ‘‘(dd) for 2028, 92 percent; ‘‘(ee) for 2029, 90 percent; ‘‘(ff) for 2030, 85 percent; and ‘‘(gg) for 2031 and each subsequent year, 80 percent. ‘‘(D) TOTAL EXPENDITURES.—For purposes of this para- graph, the term ‘total expenditures’ includes, in the case of expenditures with respect to part D, the total gross covered prescription drug costs as defined in section 1860D–15(b)(3). The term ‘total expenditures’ excludes, in the case of expenditures with respect to part B, expendi- tures for a drug or biological that are bundled or packaged into the payment for another service. ‘‘(E) SPECIAL CASE FOR CERTAIN CLAIMS.— ‘‘(i) CLAIMS SPANNING DEDUCTIBLE.—In the case where the entire amount of the negotiated price of an individual claim for an applicable drug with respect to an applicable beneficiary does not fall above the annual deductible specified in section 1860D–2(b)(1) for the year, the manufacturer of the applicable drug shall provide the discounted price under this section on only the portion of the negotiated price of the applicable drug that falls above such annual deduct- ible. ‘‘(ii) CLAIMS SPANNING OUT-OF-POCKET THRESHOLD.—In the case where the entire amount of the negotiated price of an individual claim for an applicable drug with respect to an applicable bene- ficiary does not fall entirely below or entirely above the annual out-of-pocket threshold specified in section 1860D–2(b)(4)(B)(i) for the year, the manufacturer of the applicable drug shall provide the discounted price— ‘‘(I) in accordance with subparagraph (A)(i) on the portion of the negotiated price of the applicable drug that falls below such threshold; and ‘‘(II) in accordance with subparagraph (A)(ii) on the portion of such price of such drug that falls at or above such threshold. ‘‘(5) MANUFACTURER.—The term ‘manufacturer’ means any entity which is engaged in the production, preparation, propaga- tion, compounding, conversion, or processing of prescription drug products, either directly or indirectly by extraction from substances of natural origin, or independently by means of chemical synthesis, or by a combination of extraction and chem- ical synthesis. Such term does not include a wholesale dis- tributor of drugs or a retail pharmacy licensed under State law. ‘‘(6) NEGOTIATED PRICE.—The term ‘negotiated price’ has the meaning given such term for purposes of section 1860D– VerDate Sep 11 2014 13:57 Oct 25, 2022 Jkt 029139 PO 00169 Frm 00071 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL169.117 PUBL169 jmbennett on LAP3P8D0R2PROD with Publaw