CA Senate Passes Major Prescription Drug Bill to Lower Costs for Californians

The California State Senate has advanced to a final floor vote the biggest prescription drug price bill of the year, intended to lower prescription drug prices for California consumers by hundreds of millions of dollars a year.
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For Immediate Release: Monday, September 11, 2019

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)

CA SENATE PASSES MAJOR PRESCRIPTION DRUG BILL TO LOWER COSTS FOR CALIFORNIANS

  • California State Senate passes AB 824, by Assemblymember Wood and sponsored by Attorney General Becerra, to deter harmful “pay for delay” prescription drug agreements–practices that FTC once calculated cost Americans $3.5 billion a year in inflated pharmaceutical costs.
  • Facing opposition from drug manufacturers who benefit from these deals, AB 824 is backed by consumer, senior, health, labor, employer, and other organizations.
  • The bill now heads back to the Assembly for a concurrence vote, and must be sent to Governor Newsom by September 13th. 

SACRAMENTO, CA — The California State Senate has advanced to a final floor vote the biggest prescription drug price bill of the year, intended to lower prescription drug prices for California consumers by hundreds of millions of dollars a year. AB 824, by Assemblymember Wood and sponsored by Attorney General Xavier Becerra, would deter harmful “pay for delay” practices by pharmaceutical and generic drug manufacturers.

The bill will help prevent anti-competitive agreements where brand name pharmaceutical companies pay generic drug makers to put off lower-cost alternative medications from entering the marketplace. The bill does not ban settlements that bring generics to the market sooner, but instead puts the burden of proof on the drug companies to ensure that any agreements are pro-consumer and not anti-competitive. In 2010, the Federal Trade Commission estimated Americans pay $3.5 billion a year more for medications because of these “pay for delay” practices, and that figure has likely gone up significantly since that finding. AB 824 ensures that lower-cost generic alternatives reach the market sooner, providing the cost relief many Californians need. Opposed by generic drug manufacturers and other drug companies who make money on these deals, AB 824 is supported by dozens of consumer advocate and health care groups.

“When drug companies pay to prevent a lower-price medication from entering the market, we all pay more, every month, at the pharmacy and in our premiums. With this bill, California can help save California consumers hundreds of millions dollars, by working to prevent this problematic, price-gouging practice of pay-for-delay by the prescription drug companies,” said Yasmin Peled, policy advocate at Health Access California, a strong supporter of AB 824. “Generic and other drug companies are fighting against this bill because they want to continue to collude with anti-competitive agreements that benefit themselves at the expense of the public. It’s bad enough that drug companies abuse the patents they get by charging sky-high prices, it’s worse when they keep cheaper options off the market to make patients pay more for longer.”

Consumer, community, patient, and purchaser organizations have prioritized AB 824, as part of a broader Care4All California package to get to a universal, affordable, and accountable health care system. AB 824 now heads back to the Assembly for a concurrence vote. All bills need to be voted on by the full legislative bodies and sent to Governor Newsom by September 13th.

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