Drug Price Transparency Bill Stalls in Virginia General Assembly

Legislation to make drug makers reveal how much they spend marketing high-priced drugs has stalled in the Virginia General Assembly, at least for this year.

Virginia state senators said the bill wasn’t ready for prime time, but was an issue worth reviewing after further study. A Senate panel voted on Feb. 4 to delay consideration of the bill until next year.

Virginia is the latest battleground state in which drug companies and health insurers are pitching a high-stakes and high-dollar battle over expensive specialty prescription drugs. Those efforts have so far failed, including in California where a similar bill was defeated last month.

The battle features two lobbying heavyweights, both of which have given millions of dollars to Virginia politicians and have a heavy Capitol lobbying presence.

Medication costs are now the public’s main health care concern, according to a poll released in August by the nonpartisan Kaiser Family Foundation. High-priced new drugs, including a $1,000 pill for hepatitis C, have alarmed the public.

Insurers were hoping to capitalize on the public’s concern with legislation that would require pharmaceuticals to publish the cost of developing, manufacturing, and marketing drugs that cost $10,000 or more for a single course of treatment. Backers of the bill, which included some business groups, said more transparency about drug prices would help deter bad actors in the pharmaceutical business from unfairly raising prices.

“It’s a bit awkward when you bring forward legislation that kind of steps on the toes of your friends,” said the bill’s sponsor, GOP Sen. Emmett Hanger. “We know very little about how drug companies set prices for the most expensive products.”

Drug makers pushed back against the bill, saying it unfairly singled out pharmaceuticals for rising health care costs and would inhibit Virginia’s efforts at growing its bio-tech industry.

Jeffrey Gallagher, of the Virginia Biotechnology Association, said if Virginia was the first state in the country to pass this kind of legislation it would send a signal that the Old Dominion is “uniquely antagonistic to an industry we’re trying to grow.”

Though the Virginia Senate voted to punt the issue this year, insurance executives said they were happy lawmakers did not dismiss the issue out of hand and promised to reconsider it next year.

A similar bill in the House has not yet had a hearing but will likely meet the same fate if it makes it to the Senate.