With the presidential race hogging the headlines, it’s easy to overlook California’s Proposition 61, a ballot measure that aims to rein in the runaway prices of prescription meds and save the state millions in the process.
Also known as the Drug Price Relief Act, the measure is supposed to save taxpayers money by ensuring that the state gets good deals on meds. Specifically, the bill would guarantee that state programs like Medi-Cal would not pay more for prescription drugs than the lowest price paid by the U.S. Department of Veterans Affairs. According to The New York Times, thanks to federal law, the VA pays a lower price for drugs—in 2005, it paid 42 percent of the list price for name-brand drugs (Medicaid paid 51 percent and Medicare paid even more).
On first glance, Prop 61 would seem like a great deal for Californians. We’ve all heard about the sky-high cost of new hepatitis C drugs ($1,000 per pill), the 5,000 percent price hike of AIDS-related med Daraprim by Turing Pharmaceuticals and, most recently, the more than 400 percent increase in EpiPens (for people with food allergies). In fact, according to a Reuters report that looked at the top 10 drugs in the country, prices for four of them have more than doubled since 2011, while the costs of the other six meds have gone up by at least 50 percent.
On closer inspection, though, Proposition 61 might not result in any savings for the state. In fact, opponents claim it could make the situation worse. Why is that? For starters, as The New York Times points out, drugmakers could simply raise the prices they charge the VA. Or they could decide not to sell meds to state programs. Another factor is that drugmakers often give rebates and discounts to state programs, but because those deals are confidential, it is difficult to calculate how much California would actually save.
The Bay Area Reporter notes that the California Legislative Analyst’s Office found that the outcome of Prop 61 is “highly uncertain.” And San Francisco’s Project Inform, an HIV advocacy group, suggests that it’s unclear whether the ballot would save the state any money. And even if it did, there’s no guarantee that this would translate to savings for the employers and consumers.
To complicate the issue for HIV advocates, there is the prominent role being played by the Los Angeles–based AIDS Healthcare Foundation (AHF), which operates clinics across the globe. Its president, Michael Weinstein, has vocally opposed the promotion of pre-exposure prophylaxis (PrEP), the daily pill to prevent HIV, and supported legislation outlawing condomless sex in adult films.
AHF, The Bay Area Reporter notes, has spent more than $9 million in support of Proposition 61. But as AHF’s detractors observe, Weinstein’s group “brought in more than $1 billion last year selling prescription drugs and operating HMOs. Suspiciously, he exempted his organization’s HMO from having to comply with his own measure.”
Already about $70 million has been spent to defeat Prop 61, according to The Los Angeles Times. As November approaches, the campaigns both for and against the measure—just like those of the presidential race—will only heat up.