Health Care

House panel seeks to rework drug pricing law

The House Health Care Committee says it will look at ways to revise the prescription drug price transparency law it spearheaded last year because the law has not produced the intended results.

The committee took testimony Feb. 1 to follow up on the 2016 law, which made Vermont the first state to require price transparency from pharmaceutical companies.

Bill Lippert
Rep. Bill Lippert, D-Hinesburg, chair of the House Health Care Committee. File photo by Erin Mansfield/VTDigger
Rep. Bill Lippert, D-Hinesburg, the chair of the committee, said the law has not yet explained “outrageous” increases in prescription drug prices. He said there would be a committee bill this year to update it.

The law requires the Green Mountain Care Board, which regulates hospital budgets and insurance prices, to make a list of up to 15 drugs that Vermont’s Medicaid program spends substantial amounts on, and whose gross prices had increased dramatically.

The law requires the attorney general’s office to then request information from the manufacturer of each drug to justify the cost and write a report explaining why the prices of those drugs went up, without disclosing the companies’ trade secrets.

The first report under the law, submitted to the Legislature Dec. 1, was about four pages long, including white space, graphics and information that described both the law and the process the attorney general’s office used for enforcing it.

In parts of the report, the AG’s office described how manufacturers argued that the state should not be using the parameters it uses in the law to judge the price of the drug, and that the state Medicaid program pays “significantly less for drugs than private payers.”

The report said manufacturers identified “a number of factors” in drug pricing decisions and that “different manufacturers seem to rely more or less heavily on different combinations of these factors.”

Rep. Anne Donahue, R-Northfield, said there was one real paragraph with a description of pricing decisions, but it lacked specificity. “We got this kind of one glob paragraph that said, ‘Here’s what they all said were the different factors in pricing,’” she said.

“And I think we were hoping for a little more ‘a majority of the companies said the primary factor was,’” Donahue said. “Or even, they could’ve said, ‘X company said that for Y drug, the primary reason was Q.’ I don’t think we necessarily interpreted that that would be a protected trade secret.”

Jill Abrams, the assistant attorney general who wrote the price transparency report, did not respond to requests for comment made early last week.

Rep. Sarah Copeland Hanzas, D-Bradford, said people will concentrate on whatever the Legislature decides to measure. She said, for example, that someone whose car dashboard displays gas mileage will attempt to get better gas mileage.

“If you shed light on somebody being an outlier in terms of, in this case, the rising cost of their prescription drug, it does serve to have a moderating impact,” Copeland Hanzas said. “Companies don’t want to be the most egregious.”

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Erin Mansfield

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  • Dave Bellini

    Drug companies 1. .. Legislature 0.

  • Shouldn’t the real question be, “Why are people taking these drugs?” Are there alternatives to taking these drugs? What lifestyle changes can individuals make to avoid these drugs? How did they end up on these drugs? The problem isn’t the price of the drugs. The problem is what created the need for the drugs.