Oregon Prescription Cost Savings Act

Statement By Mitch Greenlick

Drug company profits are out of control.
Everywhere I go, citizens are asking me how we are going to fix this problem. Today, I want to unveil what I believe will form the cornerstone for an Oregon Plan to stop the drug companies from exploiting our seniors, our disabled citizens, and those with chronic illness. If the federal government won't do it, let's do it right here in Oregon. If elected, I will be leading the charge.

Total prescription drug costs in the United States now exceed $120 billion per year.
And that figure is expected to reach nearly $200 billion per year by 2005. The elderly and chronically ill carry an unfair and disproportionate burden of these costs. People older than 75 years of age pay, on average, more than $830 per year for prescription drugs. That means an elderly couple is likely to spend nearly $150 per month on prescriptions. Many spend far more than that.

Prescription prices are higher in the United States than elsewhere in the world.
For example, the wholesale price of Claritin is $225 in the United States, $57 in Canada, and $11 in Mexico. (All in US dollars.) The senior citizens of Oregon and those with chronic diseases are being eaten alive by prescription drug costs. It';s time we took some action to protect their interests and to reduce the impact of the costs on our citizens of Oregon.

Today, as part of my campaign for State Representative, I am announcing The Oregon Prescription Cost Saving Act. This proposed law will enable the citizens of our state to voluntarily join together with the State to use our purchasing power to bargain on behalf of our own citizens.

1. A statewide, non-profit organization will be created to allow senior citizens, disabled persons, those with chronic illnesses and any other citizen of Oregon to join an Honored Citizens' Purchasing Group organized to reduce the cost of their prescriptions.

2. The state will create a pharmacy benefits management program to negotiate with drug companies for the purchase of pharmaceuticals for use in any state sponsored program, including, but not limited to, the Oregon Health Plan, other Medicaid programs, the State Employees Health Insurance Program, student health services in public colleges and universities, and the Honored Citizens'; Purchasing Group.

3. The power of the State of Oregon should be used to ensure that drug companies negotiate in good faith with the state pharmacy benefits management program.

By joining together - and I stress again this is a voluntary plan where any Oregon citizen can join - we'll be able to use our tremendous buying power to get better prices. It's simple... it's like buying at Costco. If you buy 12 rolls of paper towels there, the unit cost for each roll is much cheaper than buying one at the store.

So those hundreds of people who buy Claritin will now be able to use our combined power to get a group rate. The program will allow every person to buy their prescriptions where they buy them now.

The drug companies, because of their money and their power, have been well represented in most state legislatures. It';s time our citizens have legislators who can effectively represent their interests against those of the drug companies.

Mitch Greenlick is a candidate for the Oregon House of Representatives from House District 7. He was Vice President (Research) for Kaiser Foundation Hospitals for 32 years and was Chair of Public Health and Preventive Medicine at Oregon Health Sciences University from 1990 until April of this year. He is a member of the National Academy of Sciences (Institute of Medicine). Greenlick, who holds a BS in Pharmacy, an MS in Pharmacy Administration, and a Ph.D. in Medical Care Organization, has been a national expert on prescription costs and prescription insurance since 1958 when he was an instructor of pharmacy administration at Wayne State University in Detroit.

For more information call the Greenlick Campaign at (503)292-2223 or call Mitch Greenlick at (503)481-4290.

Highlights of the Maine Law To Rein in Prescription Drug Costs

Some other states have begun to take action, passing laws to rein in these out-of control drug companies. One such state is Maine, which enacted the landmark Maine Public Law 786, "An Act to Establish Fairer Pricing for Prescription Drugs" signed by Maine Governor Angus King last May. Senate Majority Leader Senator Chellie Pingree led the fight to get this bill enacted.

Findings in the Profiteering in Prescription Drugs portion of that act conclude:

1. Pharmaceutical companies are charging the citizens of Maine excessive prices for prescription drugs, denying Maine citizens access to medically necessary health care and thereby threatening their health and safety. All Maine citizens are threatened by the possibility that when they need medically necessary prescription drugs most they may be unable to afford their doctor's recommended treatment.

2. Citizens of Maine and other Americans pay the highest prices in the world for prescription drugs, prices that result in extremely high profits for pharmaceutical companies.

3. Prescription drug costs represent that fastest growing item in health care and are a driving force in rapidly increasing hospital costs and insurance rates.

4. Excessive pricing for prescription drugs threatens Maine's ability to assist with the health care costs of Maine citizens, undermines the financial capacity of Maine communities to meet the educational needs of Maine children, hurts the ability of the Maine business community to provide health insurance coverage to Maine's work force and has a negative effect on Maine's economy.

The Law in Maine contains three major provisions:

First, Maine established the Maine Rx Program, which, in implementing the program, directed the State to serve as a pharmacy benefit manager to negotiate with drug companies to establish rebates and discounts on behalf of qualified residents of the State.

Second, in the Prescription Drug Price Reduction component of the Act, Maine created a Prescription Drug Advisory Commission to review access to and the pricing of prescription drugs for residents of the State and to advise on prescription drug pricing.

Finally, the act declared that profiteering in prescription drugs occurs when a company exacts or demands an unconscionable price, exacts or demands prices or terms that lead to any unjust or unreasonable profit, discriminates unreasonably against any person in the sale, exchange, distribution or handling of prescription drugs dispensed or delivered in the state.

On signing the bill, Governor Angus King, an independent, said "If the industry can consolidate and increase its market power, so can we. We're going to bargain on behalf of 50% of our citizens and we think that they deserve the same consideration as other groups that get discounts based on their volume."