States’ Actions on Prescription Drugs Met By Industry Opposition
National Journal this week examines the recent steps that states have taken to lower prescription drug prices and states' increased efforts to challenge drug makers' pricing practices in court, activities that have led the pharmaceutical industry to raise its profile on the state level. State prescription drug programs, which "vary widely" from purchasing co-ops in Iowa and West Virginia to tax breaks for seniors in Michigan, Missouri and other states, stem in large part from Congress' failure to enact a Medicare prescription drug benefit, the magazine reports. Many of the state initiatives, however, have been met with industry challenges. A recent federal appeals court decision sided with the Pharmaceutical Research and Manufacturers of America, ruling that Vermont's prescription drug program, which would expand its Medicaid program to offer prescription drug discounts to seniors and other adults who do not meet Medicaid income-eligibility requirements, was improperly approved by HHS. "We've had a very substantial increase in our state lobbying budget over the last three years," PhRMA President Alan Holmer said, adding, "I think the challenges in the states are very significant." Critics, however, say that the industry's efforts block meaningful attempts to address rising prescription drug prices. Stephen Schondelmeyer, a professor of pharmaceutical economics at the University of Minnesota, said, "Rarely does the industry go in and propose solutions. They go in and kill or downgrade reform proposals." The industry also faces challenges against its own pricing practices. For example, 28 state attorneys general have filed a $100 million lawsuit alleging that Aventis and Andrx Corp. "conspired to keep a generic version of a popular heart medicine, Cardizem CD, off the market." In addition, state and federal officials have investigated more than 20 drug makers since 1997 to determine whether they illegally inflated the wholesale prices of drugs charged to government programs and then sold the drugs to doctors at deep discounts, allowing physicians to profit from larger Medicaid reimbursements while drug makers increased market share (Stone, National Journal, 7/21).
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