SACRAMENTO, Calif. (AP) — Frustrated by the rising cost of prescription drugs, California health advocates hope sunlight and a dose of shame will discourage drugmakers from raising their prices too quickly or introducing new medications at prices that break the bank.
They’re promoting legislation that would require drugmakers to provide advance notice before making big price increases. Pharmaceutical companies have come out in force against the measure, warning it would lead to dangerous drug shortages.
Attention to prescription drug pricing has mounted since Turing Pharmaceuticals bought an old drug commonly used with HIV patients and raised the price from $13.50 per pill to $750. The company’s combative chief executive, Martin Shkreli, was widely castigated for the price hike.
“Yes, they should make a profit, but not so much they gouge the public at the expense of the consumer and the taxpayer,” Sen. Ed Hernandez, a Democrat from Azusa who wrote the legislation, said of drug companies. “There needs to be a balance.”
Vermont passed the nation’s first drug price transparency legislation earlier this year, and similar measures were introduced in at least five other states, including California.
California voters also will decide in November on a ballot measure that would prohibit the state — which covers millions of poor people, inmates and government retirees — from paying more than the U.S. Veterans Administration for drugs. The VA’s massive negotiating power allows it to secure some of the lowest rates for drugs.
Both presumptive presidential nominees have cited drug prices in their campaigns. Republican Donald Trump suggested ending a restriction on Medicare’s ability to negotiate drug prices. Democrat Hillary Clinton has slammed drug pricing she labels predatory.
Drug costs represent about 10 percent of overall healthcare spending and about 19 percent of costs for employer-sponsored health plans, according to the Kaiser Family Foundation. After several years of modest growth in drug spending, which even decreased in 2010 and 2012, pharmaceutical spending spiked 11.4 percent in 2014, according to the Kaiser’s analysis of data from the Centers for Medicare and Medicaid Services. Estimates for 2015 suggest prices rose 6.8 percent.