RICHMOND, Va. (AP) - Two lobbying behemoths have been quietly duking it out behind the scenes at the Virginia General Assembly over a whether drugs companies should have to open up their books.
Health insurers are hoping to capitalize on the public’s concern about prescription drug prices with legislation that would require pharmaceuticals to publish the cost of developing, manufacturing, and marketing of drugs that cost $10,000 or more for a single course of treatment.
Supporters said the legislation is a straightforward transparency measure that would allow the public to better understand where their health care dollars go. Pharmaceutical companies said the bill would not provide an accurate look at the true costs and benefits of their products, and suggest the legislation is the first step toward government-related price controls that would stifle future innovations.
Both sides have given millions of campaign donations in past years and have a heavy Capitol lobbying presence.
Doug Gray, executive director of the Virginia Association of Health Plans, said drug companies are spreading misinformation about the bill because they don’t want the public to know how much is spent advertising certain drugs compared to research and development costs.
“They want to muzzle the conversation entirely,” Gray said.
Priscilla VanderVeer, a spokesman for the drug companies’ trade group, Pharmaceutical Research and Manufacturers of America, said insurance companies are trying to unfairly demonize drug companies for rising health care costs in general.
“Our health care system is extremely complex, you can’t just single out one piece of it,” she said. “How will this actually help patients who are struggling to access their medicines gain access?”
Lawmakers say the lobbying on both sides has been intense.
“I think they’ve written each other off each other’s Christmas card list,” said Del. Tim Hugo, a member of Republican leadership who is sponsoring the House version of the bill.
Virginia is the latest in a number of states where health insurers have tried similar measures since last year. Those efforts have so far failed, including in California where a similar bill was defeated last month.
But Gray said he likes the bill’s chances in the GOP-controlled Virginia General Assembly in part because of the impact high prices of certain drugs are having on the state employee health plan. Spending on prescription drugs by the state health plan went from $170 million in 2011 to $234 million in 2015, according to state data.
“Fiscal conservatives care about being responsible for state funds, and the rising drug costs are hitting the state hard,” Gray said.
Medication costs are now the public’s main health care concern, according to a poll released in August by the nonpartisan Kaiser Family Foundation.
High-priced new drugs, including a $1,000 pill for hepatitis C, have alarmed the public. And pharma’s reputation is also reeling from the exploits of Martin Shkreli, a 32-year-old CEO who unapologetically raised the price of the only approved drug for a rare disease from $13.50 to $750 per pill.
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