[Ip-health] Maryland House of Delegates passes price gouging by vote of 137 to 4

Jamie Love james.love at keionline.org
Tue Mar 21 11:40:31 PDT 2017


On March 20, 2017, the Maryland House of Delegates approved a prescription
drug price gouging bill by a vote of 137-4. A copy of the bill, as it
passed the House, is attached.

This is a March 20, 2017 Report by Erin Cox, published in the Baltimore Sun:


Maryland's attorney general could sue drug companies for price gouging
under a bill approved by the House of Delegates Monday.

Under the legislation a drug price increase by more than 50 percent would
trigger a report to the attorney general, who would have power to demand an
explanation for the increase.

The proposed law also allows the state's top lawyer to ask a judge to
determine whether a drug company implemented an "unconscionable increase"
to a critical prescription medicine. The measure allows a judge to fine the
drug company, as well as order refunds to consumers.

Attorney General Brian E. Frosh sought the new authority.

The measure, which passed 137-4, now moves to the Senate, which has held a
hearing on the matter but not advanced the companion bill. The annual
General Assembly session adjourns in three weeks.

The Maryland Citizens Health Initiative pushed very hard for this bill.
This is a statement by its President, Vincent DeMarco, on the House Passage
of HB 631, Prescription Drug Price Gouging Bill on March 20, 2017

"We commend the Maryland House of Delegates for passing this life-saving
measure authorizing Attorney General Brian Frosh to take legal action to
stop prescription drug price gouging. We call on the State Senate to do the
same and for Governor Hogan to sign this measure into law."


Summary of Prescription Drug Price Gouging Bill, HB 631/SB 415

The bill would authorize the Attorney General to take legal action to
prevent price gouging on off-patent medications. Specifically, the Attorney
General would be able to take action if the manufacturers of an off-patent
or generic drug make an “unconscionable increase” in the price of the drug,
defined as an excessive increase that is not justified by the cost of
producing or distributing the drug. "Unconscionable" is not a moral term
but a legal doctrine, invoked when consumers have no other option but to
purchase an essential product at its new inflated price. Maryland would
help lead the nation to make off-patent pharmaceutical price gouging an
actionable offense, and it is hoped that this law will act as a deterrent
against the future Martin Shkrelis of the world. This is especially
important when very little is likely to happen at the federal level on this

Under the new bill, the Maryland Medicaid Assistance Program would report
to the Attorney General when rapid or excessive price increases occur in
off-patent or generic prescription drug products. The Attorney General
would be authorized to request additional information from the corporations
who instituted these price increases to help determine if price gouging has

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