Minnesota lawmakers introduce board to regulate drug prices

Published 7:05 pm Tuesday, February 16, 2021

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MINNEAPOLIS — Minnesota Democratic lawmakers want to create an independent board to regulate excessive prescription drug prices following a bipartisan effort last year to make insulin more affordable.

The legislation, authored by Democratic Rep. Kelly Morrison, of Deephaven, would establish an independent Prescription Drug Affordability Board and an advisory council that would review the costs of new brand name prescription drugs.

The board — seven members appointed by the governor and lawmakers — would set upper payment limits for the prices of drugs it determines are unaffordable to ensure purchasers and government programs can afford to provide the drug to those who need it.

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“One in five Minnesotans had to forego prescription medicine in the past year due to cost, and that was in the midst of a global pandemic when people were already suffering economically,” Morrison said during a news conference ahead of the bill’s first hearing Tuesday before a House committee. “Drugs don’t work when people can’t afford them.”

The board would evaluate new brand-name prescription drugs that enter the market at $30,000 or more per course of treatment, existing brand-name drugs that increase in price by $10,000 or more per year, and generic drugs that increase in price by 200 percent or more. The board would use input from the advisory council, as well as public comment and justifications from drug manufacturers, to determine the upper payment limit.

The legislation follows the Alec Smith Insulin Affordability Act passed last spring, which established a safety net program for diabetics who can’t afford the live-saving drug.

The law is named for Alec Smith, an uninsured 26-year-old Minneapolis man who died in 2017 of complications from rationing his insulin — a common but dangerous strategy among those who lack sufficient coverage.

Travis Paulson, a lifelong Type 1 diabetic, said he found himself rationing insulin and other medications after losing his job and home during the 2008 financial crisis. Paulson, an advocate for affordable prescription drugs, urged support for the bill to prevent people from acquiring drugs from other sources or going without.

“There’s a whole black market for medication because it’s too unaffordable,” he said. “People like me are medical refugees, and it’s like the government is just looking the other way — I don’t know how much longer we can sustain ourselves.”

Opponents of the bill include the Minnesota Chamber of Commerce, who say the board would set a “very concerning precedent” for government control of products sold in a competitive private market. In a letter to the House commerce committee, the Pharmaceutical Research and Manufacturers of America argues that putting a cap on drug prices would limit prescription options for patients and harm the development of new life-saving drugs.

“Price controls can limit access to needed medications, can undermine beneficial competitive forces, and ignore the ways in which medicine improves lives and saves the health system money,” the letter reads. “Patients need concrete reforms that will help lower the price they pay for medicines at the pharmacy, such as making monthly costs more predictable, making cost sharing assistance count and sharing negotiated savings on medicines with patients.”

The new board is the first of 14 recommendations made by a state advisory task force on lowering pharmaceutical drug prices established by Attorney General Keith Ellison’s office nearly two years ago. Other recommendations in the task force’s report released by Ellison’s office last February include antitrust and price gouging legislation targeting drug manufacturers, among others.

Ellison said his office is currently suing about 40 generic drug manufacturers for price-fixing.

“Companies who manufacture these life-saving drugs feel that their right to gouge profits off of people is more important than the lives of our fellow Minnesotans and Americans generally,” Ellison said during the news conference. “And we’re here to do something about it.”

The bill has a companion in the GOP-controlled Senate from Democratic Sen. Melisa Franzen of Edina.