Demanding Affordable Medicines: Lessons From Maryland’s Law Against Price Gouging

On the campaign trail, then-candidate Donald Trump declared that drug companies “are getting away with murder.” His first months in office, however, have shown that he is more intent on giving large pharmaceutical companies tax breaks than taking action to bring drug prices down. The Republican-controlled 115th Congress has been slow to act as prescription drug prices reach crisis levels for patients.

In lieu of federal action, state advocates across the country are achieving breakthroughs in campaigns for drug price transparency and affordability. If we look beyond the partisan gridlock of DC, we can learn from these local victories and build on them. A recent success in Maryland can teach us a lot about how to make progress at the state level and build momentum for affordable medicines.

Maryland’s Surprise Victory

In April 2017, a drug-pricing bill passed with overwhelming, bipartisan support in the Maryland Senate (38-7) and House (137-2). The legislation, HB 631, took a novel approach to the issue of rapidly spiking drug prices. It would allow the state’s attorney general to crack down on pharmaceutical price gouging in cases of excessive and unjustified price increases that harm consumers. The attorney general can bring cases to the State Circuit Court, with possible remedies including restraining price-gouging activities, restoring money to consumers or imposing a fine of up to $10,000 for each violation. Despite strong opposition from pharmaceutical companies, HB 631 became law and presents a new tool to hold generic drug manufacturers accountable and deter price hikes in the state.

Less than two months before this victory, Maryland Health Care for All! organizer Matt Celentano did not know that this bill would move forward, never mind pass overwhelmingly. In a recent conversation, he acknowledged that the victory on HB 631 required a combination of grassroots energy, clear messaging and opportune timing. The EpiPen pricing scandal kept the issue of overpriced medicines in the headlines and put pressure on the legislature to come out of the session with a sign of progress.

The coalition also benefited from having State Attorney General Brian Frosh concerned with the problem of unjustifiable price hikes. “We’ve heard many complaints from folks all over our state,” Frosh told Truthout. While off-patent drugs like Martin Shkreli’s Daraprim could be raised with impunity before, Frosh believes the passage of HB 631 sends a clear message: “Not in Maryland.” He worked with advocates to testify and lobby in favor of the bill. “It is not a panacea,” Frosh said, “but I hope it helps.” Timing and influential allies like Frosh helped, but advocates would not have achieved such an overwhelming victory without months of mobilizing voters, educating legislators and building a broad Prescription Drug Affordability Coalition that included Doctors for America, AARP and more than 60 other groups. This preparation was crucial when the legislation started to move and pharmaceutical industry groups dialed up their opposition.

Countering Pharma’s Tactics

The Association for Accessible Medicines, a group representing drug manufacturers, actively opposed HB 631 in the local press and the Maryland General Assembly. With more than 15 years of experience working on health care policy in Maryland, Celentano knows from experience how skilled pharmaceutical lobbyists are at deflecting, creating uncertainty and sticking to tried and true arguments. “For five decades, they’ve used the same talking points over and over,” he said. “And it works because they keep winning.”

The familiar arguments claim that drug prices need to be raised to recoup the costs of researching and developing drugs, and that legislation to bring prices down would slow innovation and prevent new drugs from being manufactured. They leave out the fact that most big pharmaceutical companies spend more on marketing or on share buybacks than they do on research. Nevertheless, these threats sow seeds of doubt and often cause concerned legislators to pump the brakes on drug-pricing legislation.

This time, however, Celentano and his coalition prepared for this opposition and used rapid response with legislators and the public to correct misleading claims from the other side. “You have to fight fire with fire,” Celentano said. The advocates corrected misleading statements, but also brought up the pharmaceutical industry’s high profit margins, CEO compensation and specific drugs that are overpriced. They stuck to a clear message that this legislation would make prescription drugs more affordable, which the majority of voters support. Millions of Americans have experienced sticker shock at the pharmacy, and positioning this legislation as part of the solution to that pervasive problem helped it pass overwhelmingly.

This victory can show advocates in other states how important it is to build a base of information with voters and legislators, and use rapid response to counter talking points from industry lobbyists. Celentano also recommended activists not “be afraid of creative ways.” HB 631’s method of cracking down on pharmaceutical price gouging was the first of its kind, and there are advantages to trying something new. If the time and political situation are right, legislatures might want to lead and be the first to pass a new policy. Now, Celentano said advocates from 29 different states had asked about the policy and how they could adapt it for their states.

Going Forward

Maryland’s passage of HB 631 is one of a few victories in state drug-pricing legislation over the past year. Most recently, Nevada passed a bill in June focused on the price of drugs for people with diabetes. Advocates across the country are engaged to continue building on these successes, and new resources are being developed to share information and strategy. The Yale Global Health Justice Partnership recently released a primer for states titled “Curbing Unfair Drug Prices” that provides background, strategic considerations and recommendations for state officials and advocates. The primer recommends comprehensive laws to address unfair price increases for both generic and patented drugs, as well as transparency laws that mandate the release of information on development, manufacturing and marketing costs of a drug.

In the next few months, voters and legislatures will face more decisions on drug-pricing legislation in states across the country. The highest-profile case will be an Ohio ballot initiative on the Ohio Drug Price Relief Act this November. The bill would require the state to pay no more for prescription drugs than the Department of Veteran Affairs does (similar to California’s Proposition 61, which failed 46-54 percent last November). California, Connecticut, New York, Washington and many other states also have pending legislation to address high drug prices. The National Conference of State Legislatures has a database you can use to see what is happening in your state legislature.

In closing, Celentano advised that, “The only way to win this war is little by little.” Significant opposition from pharmaceutical companies has made progress difficult, but momentum is clearly increasing. As soon as one minor, limited victory happens, it makes others more likely. Continued engagement from patients, advocates and broad coalitions in states across the country will be crucial to addressing the national crisis of unaffordable medicines. We cannot count on Congress or the Trump administration to address high drug prices, but a system that puts people above profits is possible if we mobilize, learn from past efforts and make progress state by state.