On Tuesday, September 20, while pharmaceutical lobbyists in Washington were busy peddling influence in the halls of Congress, the Council of the District of Columbia was passing a groundbreaking law restricting drug-company pricing. By unanimous vote, the council declared that selling patented drugs at “excessive prices” was illegal. It defined “excessive” as anything more than 30 percent over the price of the same drug in Germany, Canada, Australia, or the United Kingdom. The law allows the D.C. government -- or any city resident -- to force a drug company to prove to a court that its development and marketing costs and profits justify U.S. prices way above those charged abroad.
Hundreds of thousands of displaced Gulf Coast residents are finding themselves in a health-insurance crisis. While those injured, sick, or chronically in need of health-care services are finally gaining access to emergency medical services at shelters or in the towns and cities to which they have been evacuated, their ability to continue getting needed care is made very difficult and put at risk because the United States does not have a national health insurance system.
Unless the drug industry starts to negotiate significantly lower prices, it may find itself battling debt-strapped states for control over the manufacture of drugs. States already take land and other property in order to benefit the public by building things such as roads and schools. Now some legislators and officials are saying they should be able to take away a drug company's intellectual property, its patent. They want to give these patents, which allow a company to manufacture a product, to competitors that agree to sell the drugs to the states at much lower prices.
After creating record federal budget deficits by giving tax cuts to the wealthy and financing the war in Iraq, the Bush administration's budget proposal in February is widely expected to try to shrink deficits largely by slashing programs for the poor and the elderly, particularly Medicaid. Capitol Hill is expecting the administration's fiscal 2006 budget to include drastic cuts in federal Medicaid spending, offering states more flexibility in deciding what Medicaid will cover and who can enroll, in exchange for caps on federal money. And to help implement this the White House has just installed former Utah Governor Mike Leavitt as the new secretary of health and human services.
In April 2004, several members of the West Virginia House of Delegates ﬂew to Minnesota to speak at a national meeting of the Council of State Governments. The legislators were eager for support from other states to bolster their ongoing effort to force drug companies to lower prices.