The bulk of what I will say here is on page 72 of the voter guide.
To summarize the legislative analyst, there is virtually no scenario where this bill will reliably work to reduce pharmaceutical costs. The reasons are as follows:
- Pharmaceutical companies can increase the price of drugs not on the VA formulary that are on the state formulary. They can also increase the prices of drugs that are on the VA formulary if those prices are confidential or if the state previously negotiated lower prices than the VA’s lowest price.
- Pharmaceutical companies are not required under this law to even offer drugs on the VA formulary to the state. If they refuse to offer these drugs at the prices required under Prop. 61, the state will have to change their formulary to drugs not covered by Prop. 61.
- Pharmaceutical companies will have an incentive to negotiate higher prices with the VA, raising prices for veterans and failing to save the state any money.
In addition to this, there are other fiscal effects on the state. There will be a cost of implementation and if Prop. 61 prevents the state from offering required drugs on the Medicaid formulary, the state will lose all Medicaid funding for pharmaceuticals. In the latter case, it is likely that Medi-Cal will simply refuse to comply with Prop. 61
Furthermore, because Medi-Cal is California’s Medicaid program, Medi-Cal compliance would have nationwide effects on drug prices, placing tremendous pressure on pharmaceutical companies to force Medi-Cal to be noncompliant with Prop. 61.
Besides all of this, Prop. 61 will only effect pharmaceutical costs paid for directly by the state. Any pharmaceuticals paid for by private insurance or local government will not be regulated by Prop. 61. This pool is too restrictive for the state to have a strong bargaining position.
I won’t tell anybody else how to vote, but please, read the analysis before you vote and don’t vote just to stick it to Big Pharma.