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Vermont Wants Drugmakers To Be Held Accountable For Pharmaceutical Price Increases

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Drug Pricing

Vermont is currently the first state to successfully pass such a transparency bill through both Legislative houses.

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May 17, 2016 | by Sarah Massey, M.Sc.

In Vermont, a new bill is on the table which could require pharmaceutical companies to explain their reasoning behind price increases of prescription drugs. Drug pricing has been a hot topic lately, with Valeant and Turing’s price increases pushing the issue into the media spotlight.

While drugmakers often cite the research and development costs related to developing a new drug as the reason for high list prices, others point to gaps in the federal government’s ability to negotiate better pricing. Christopher Pearson, a Vermont state representative and a member of the Vermont Progressive Party from the state's largest city, Burlington, is a strong supporter of the proposed legislation.

Prescription drugs are often much less expensive in other countries outside the US, Pearson points out. According to him, Medicare and Medicaid have little bargaining power when it comes to getting the best price for pharmaceuticals.

Vermont is currently the first state to successfully pass such a transparency bill through both Legislative houses, according to Priscilla VanderVeer, spokeswoman for the Pharmaceutical Research and Manufacturers of America (PhRMA). Other states, including Pennsylvania, Massachusetts, New York, Virginia and California, have all had drug pricing bills under consideration since 2015.



The proposed Vermont bill would require state healthcare regulators to compose an annual list of up to 15 drugs whose prices have been increased. The drugmakers would then have to justify their price increases to the state’s attorney general’s office.

In a statement, VanderVeer said Vermont’s legislation was misguided, and that drugs actually help patients avoid hospitalizations and expensive procedures, thereby helping to control healthcare spending. “Instead of passing legislation that makes a political point, we believe the Legislature should have focused instead on giving patients and families what they actually need: predictable and accessible information about the out-of-pocket costs they will face and enforceable, common-sense rules ... that remove barriers to receiving care,” said VanderVeer.

Representative Peter Welch, a Democrat and Vermont's only congressman, is in support of the bill, especially since Congress has been slow to act on reining-in prescription drug pricing. “Why can't the state say to the pharmaceutical companies selling the drug, ‘Hey, if you're going to hammer us with a 50 percent price increase, we want to know why’?”


Keywords: Drug Pricing, Pharmaceutical Industry, American Politics


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