[Ip-health] High-cost drugs: California legislator pulls bill seeking cost 'transparency'

Elizabeth Rajasingh elizabeth.rajasingh at keionline.org
Wed Jan 13 06:51:35 PST 2016


By Tracy Seipel tseipel at mercurynews.com
01/13/2016 06:16:53 AM PST

SACRAMENTO -- In a surprising last-minute move, the Bay Area lawmaker
carrying legislation to increase the "transparency" of prescription drug
costs in California on Tuesday pulled his bill off the Assembly Health
Committee agenda, saying he didn't have the votes.

But Assemblyman David Chiu, D-San Francisco, promised to be back "because
this issue will not go away."

Assembly Bill 463 would require each manufacturer of a prescription drug
sold in California with a wholesale cost of $10,000 or more per course of
treatment to report "select information" such as research and development
costs, marketing and advertising costs, and company profits derived from
the sale of the drug.

The measure has wide-ranging support from labor, business, local
governments and public health leaders. But it's strongly opposed by the
pharmaceutical industry.

On Tuesday, Chiu needed 10 votes to move the bill forward but by the end of
the meeting, figured he did not have that many. A previous version of the
bill, introduced last year by Chiu, did not garner enough support from the
same committee to put it up for a vote.

But since then, the backlash against high-cost prescription drugs has
surfaced as a key issue on the U.S. presidential campaign trail -- and a
related effort is now heading to the state's November ballot.

That measure, the California Drug Price Relief Act, would require state
programs to pay no more for prescription drugs than prices negotiated by
the U.S. Department of Veterans Affairs, which negotiates for lower prices
for millions of vets in the U.S.

The Washington, D.C.-based Pharmaceutical Research and Manufacturers of
America, a trade group that represents at least 50 pharmaceutical companies
in the country, has already poured $38 million into the campaign to fight
the measure. The trade group also opposed AB 463.

Priscilla VanderVeer, a spokeswoman for PhRMA, said Chiu's legislation
unfairly singles out the pharmaceutical industry "when in fact, there are a
variety of stakeholders involved in determining what consumers ultimately
have to pay for a medicine -- insurers, pharmacy benefit managers,
wholesalers and government agencies."

But Anthony Wright, executive director of Health Access California, a
statewide health care consumer advocacy coalition, agreed with Chiu that
the fight is far from over.

"Public anger is building on the issue of prescription drug costs --
whether it is hiking the prices for decades-old drugs, or the extreme costs
of some new medications. More and more patients and payers are questioning
these drug costs, and politicians will ignore that public anger at their

Chiu has consistently said insurers and patients are grappling with
six-figure price tags for medications that treat complex chronic diseases
such as rheumatoid arthritis, multiple sclerosis, cancer and Hepatitis C.
The prices for these drugs, he says, are a significant burden on the health
care system and are ultimately unsustainable.

Among the breakthrough drugs fueling public outrage are the $1,000-per-pill
Hepatitis C drug Sovaldi, which costs $84,000 for a regular course of
treatment, and Harvoni, which costs $94,500. Both drugs are manufactured by
Foster City-based Gilead Sciences.

But the costs of some decades-old drugs have been inflated as well. Last
September, the price of the 62-year-old drug Daraprim to treat a parasitic
infection as well as HIV/AIDS, was increased 5,000 percent, from $13.50 to
$750 per pill.

In December, the former chief executive of that drug company was arrested
in New York and charged with securities fraud and conspiracy related to
another company he previously ran.

Contact Tracy Seipel at 408-920-5343. Follow her at Twitter.com/taseipel.

Elizabeth Rajasingh
Perls Research and Policy Fellow, Knowledge Ecology International
1621 Connecticut Ave. NW, Suite 500
Washington, DC 20009
*elizabeth.rajasingh at keionline.org <elizabeth.rajasingh at keionline.org>* |

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