Statement Responding to Governor Newsom’s CalRX Announcement Saturday

SACRAMENTO, CA – Below is a statement by Anthony Wright, executive director of Health Access California, the statewide health care consumer advocacy coalition on Governor Newsom’s CalRx announcement today. Health Access served as the leading supporter of Governor Gavin Newsom’s budget proposal and SB 852, Senator Richard Pan’s related legislation to directly contract to manufacture prescription drugs.

“California’s investment to directly manufacture prescription drugs is a game-changer with national impact. CalRx seeks to correct real market failures that lead to inflated prescription drug prices, and it shows that government can and should use its purchasing power to provide real relief to help patients and the public afford needed medications.

“California’s work to develop a generic, get FDA approval, and set up manufacturing may take real time and effort, including to get acceptance from health plans, providers and prescribers, patients and the public, but it’s worth the investment of time and money. Even a modest decrease in the cost of key drugs could save hundreds of millions or even billions of dollars.

“This California effort to develop a competing generic likely already has had an impact, playing a part in the calculation of incumbent insulin manufacturers to cut the price of some of their products. With any reduction of the drug prices, California gets the benefit even if we don’t sell a single vial, given that the state pays for medications for over 14 million Californians. The state can and should use its significant purchasing power to benefit Californians and consumers across the country.

“CalRx is an exciting example of how the state can use its power as a purchaser to fix a market failure, and provide a public option to benefit patients and the public.”