OCTOBER 6, 2016
Proposition 61 seems pretty straightforward. The price paid for prescription drugs in California state health care programs must be equal to or lower than what is paid by the Veterans Administration.
Sadly, it isn’t that simple. There’s $101 million (and counting) being spent on this measure, which only directly affects 12% of Californians.
When I saw the words “badly flawed” in ads against Prop 61, I reflexively assumed the bad guys of Big Pharma were desperate to confuse the public… But…
What should be a slam-dunk referendum on corporate evil and greed is complicated by what looks to be financial self-serving on the part of the primary advocate for this legislation.
In One Corner…
The AIDS Healthcare Foundation, which brought this to the ballot, has already raised slightly more than $14.5 million to support it. Senator Bernie Sanders and the California Nurses Association have endorsed this measure.
Michael Weinstein is the president of AIDS Healthcare Foundation (AHF), the largest global AIDS organization, with a $1 billion annual budget. More than 600,000 people in 15 states and 36 countries worldwide received services from the group. They also own a chain of pharmacies.
Opponents of Prop 61 point to the fact that AHF’s Medi-Cal managed care plan in California is exempted from having to comply with this measure. They say AHF brought in more than $800 million last year from prescription drug sales alone.
AHF is a force to reckoned with, and, if the number of lawsuits surrounding this group is any indication, Weinstein has rubbed a lot of people the wrong way. A group of prominent HIV activists went so far as to co-author a list of his 10 Worst Offenses.
He’s also the force behind Proposition 60 (Condoms in Porn), a measure opposed by both the Republican and Democratic Parties… wait for it… because it’s flawed.
In The Other Corner…
A coalition of the big names in Big Pharma passed the hat and came up with more than $86 million to oppose Prop 61. That’s a lot of money, and it likely explains the support of some groups you might not expect to be on the industry’s side in this fight.
It’s logical to assume the drug industry is concerned about the precedent of a state mandating better pricing. Other states are watching. Ohio even has a similar measure on its 2017 November ballot.
Big pharma goes into a tizzy any time government agencies contemplate a bidding process. Medicare Part D, which is forbidden by law to negotiate, pays an extra $50 billion annually for drugs over what the VA is charged.
The Louisiana Congressman who shepherded this gift to the drug industry retired shortly after its passage, accepting a $2 million a year job as president of Pharmaceutical Research and Manufacturers of America(PhRMA), the main industry lobbying group.
That’s how Big Pharma works.
Just to make sure everybody knows they’re serious, the drugs companies are promising to increase costs to veterans, even though the measure says nothing on the subject. Their No on 61 commercials make other claims that are simply untrue–unless the drug companies decide to take “revenge.”
And the horror stories about big drug companies continue to pile up. Whether it’s their role in suppressing data about their role in the opioid epidemic or jacking up prices for Epipens after persuading the Federal government to encourage schools to purchase them, Big Pharma’s greed is there for anybody who cares to see it.
Is Everybody Bought Off?
So why are three of the State’s most prominent Democratic/LGBT Clubs and most of the Building Trade Unions standing with the GOP and Chamber of Commerces in opposing Prop 61? (The State Democratic Party and Labor Council are officially neutral.)
When I went looking for a major newspaper editorial supporting this measure, the best I could do was the very faint praise of the Sacramento Bee:
It would serve Big Pharma right if Californians passed Proposition 61… The industry certainly has given voters every reason to do it – from jacking up the cost for lifesaving EpiPens by a whopping 500 percent to making the most effective treatments for hepatitis C so expensive that they’re out reach for millions of Americans. … But Proposition 61 is not the way to do that. The initiative comes with too many uncertainties and not enough guarantees that things won’t get worse. We’re loath to admit the industry is right when it says this is an all-too-simplistic solution to a complicated issue. … In short, a vote for this initiative is a protest vote. Real change, as Brown noted, can unfortunately come primarily from Congress and, in lesser ways, from the Legislature. It’s the only cure to this racket.
The No on 61 campaign says the Bee endorsed their position. Are you confused yet?
I think I’m gonna send a message to Big Pharma and go with the protest vote. The chances of the legislature or congress doing anything that would offend their financial overlords are slim and none. Still, I doubt Proposition 61 will have the effect it promises.
For More Information
Ballot Language – STATE PRESCRIPTION DRUG PURCHASES. PRICING STANDARDS. INITIATIVE STATUTE.
Prohibits state from buying any prescription drug from a drug manufacturer at price over lowest price paid for the drug by United States Department of Veterans Affairs. Exempts managed care programs funded through Medi–Cal. Fiscal Impact: Potential for state savings of an unknown amount depending on (1) how the measure’s implementation challenges are addressed and (2) the responses of drug manufacturers regarding the provision and pricing of their drugs.
A Yes Vote Would: Prohibit State agencies from paying more for any prescription drug than the lowest price paid by the U.S. Department of Veterans Affairs for the same drug.
A No Vote Would: All State agencies to continue to be able to negotiate the prices of, and pay for, prescription drugs without reference to the prices paid by the U.S. Department of Veterans Affairs.