With SB 17 Lawsuit, Big Pharma Finds Another Way to Keep Consumers in the Dark

Late Friday afternoon, the Pharmaceutical Research and Manufacturers of America (PhRMA) filed a lawsuit attempting to block implementation of California's landmark drug price transparency law, SB 17 (Hernandez). The law (Chapter 603, Statutes of 2017), set to take effect in three weeks on January 1, 2018, requires all drug price hikes over 16% over a two-year span to be subject to transparency requirements, which would discourage double-digit price increases and better negotiations between drug companies and purchasers.
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For Immediate Release:  Friday, December 8, 2017

CONTACT: Anthony Wright, Executive Director, Health Access California

Awright@health-access.org, 916-870-4782 (cell)

Rachel Linn-Gish, Director of Communications, Health Access California

Rlinngish@health-access.org; 916-532-2128 (cell)

BIG PHARMA CONTINUES ITS QUEST TO KEEP CONSUMERS IN THE DARK FILING LAWSUIT AGAINST LANDMARK PRESCRIPTION DRUG PRICE TRANSPARENCY LAW (SB 17)

  • SB 17 (Hernandez) Was Signed into Law by Governor Jerry Brown on October 9th, 2017 and is Set to Take Effect January 1, 2018
  • Despite Pharma Spending Millions to Defeat SB 17, the Bill Passed with Strong Bipartisan Support in Both Houses of the Legislature, Along with Backing from Consumer, Labor, Insurer, School, Patient, Health Provider, Government, and Other Community Groups
  • Big Pharma Has Filed Lawsuits Challenging Every State Law Seeking to Rein in Drug Prices

SACRAMENTO, CA – Late Friday afternoon, the Pharmaceutical Research and Manufacturers of America (PhRMA) filed a lawsuit attempting to block implementation of California’s landmark drug price transparency law, SB 17 (Hernandez). The law (Chapter 603, Statutes of 2017), set to take effect in three weeks on January 1, 2018, requires all drug price hikes over 16% over a two-year span to be subject to transparency requirements, which would discourage double-digit price increases and better negotiations between drug companies and purchasers.

Below is a statement from Anthony Wright, Executive Director of Health Access California, the statewide health care consumer advocacy coalition and co-sponsor of SB 17 with the California Labor Federation and UNITE HERE:

“This is classic Big Pharma – spending obscene amounts of money to keep consumers from knowing why they continue to charge so much for prescription drugs. Despite the millions they spent opposing SB 17, the bill passed with strong bipartisan support becasue this is a law that will actually help Californians. Big Pharma failed to make their case in the Legislature and to the Governor, so they are filing a baseless lawsuit to keep consumers in the dark about outrageous drug prices. Drug companies have filed lawsuits against every state effort to shine a light on soaring drug prices, and recently lost in Marlyand. They will spare no expense to avoid answering this critical question: what is Big Pharma hiding?”

Background:

SB 17 requires advance notice of price hikes for existing drugs be given to public purchasers like Medi-Cal and CalPERS and private purchasers including health plans and insurers. It also enhances public disclosure of information about drug pricing by requiring drug manufacturers to file information about the rationale for pricing increase, marketing costs, and other specifics with the Office of Statewide Health Planning and Development. The bill also requires health plans and insurers to disclose information about drug pricing through existing rate review processes at the Department of Managed Health Care and Department of Insurance.

SB 17 was strongly backed by a broad coalition of consumer, labor, business, insurer, and other health organizations, but opposed by the pharmaceutical industry who hired dozens of lobbyists, ran radio and newspaper ads, and otherwise spent significantly in their campaign against the transparency protections of the legislation.

Resources:

SB 17 Fact Sheet

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