R.I. Gen. Laws § 40-8-24

For pharmaceutical purchases eligible for reimbursement under the Medicaid state plan, the department shall encourage the substitution of generic drugs which are therapeutically equivalent and interchangeable with specific brand name drugs in accordance with § 21-31-16.1 and related regulations of the department of health, except in the event that a brand name is determined by the director to be less costly to the state than the equivalent generic. Calculation of comparative drug costs shall include consideration of the amount paid by the state to the pharmacy for a drug under the current retail pharmacy reimbursement formula, less any discounts or rebates, including those paid pursuant to federal Medicaid law during the previous calendar quarter, and inclusive of all dispensing fees.