DENVER – Prescription medications are an essential part of treating and preventing illnesses, improving health and saving lives. But drug corporations continue to raise the costs of their drugs and unjustifiably price them out of reach. These corporations can increase prices whenever they want — pulling prices out of the sky — despite the consequences for consumers.
House Bill 1296, “The Prescription Drug Price Transparency Act” was introduced Friday and will be heard this afternoon in the House Health & Insurance Committee. This bill will give both consumers and policymakers more information on the exorbitant price of prescription drugs by creating transparency and ensuring drug corporations have to justify price increases.
The Colorado Consumer Health Initiative (CCHI), the state’s leading advocate for health care consumers, says that nobody should have to choose between affording a lifesaving drug and putting food on the table for their family.
“Drug corporations are price-gouging consumers by profiting off of medicines and making higher profits than any other industry with unjustified, overnight price hikes,” said Adam Fox, director of strategic engagement for CCHI. “Policy-makers need to understand why drug prices are going sky-high and driving up health care costs; Coloradans very simply need lower prices. Drug corporations profit from out-of-control prices that put medications out-of-reach for many families. This bill will change the rules and bring accountability.”
Key provisions of the Prescription Drug Price Transparency Act:
- Drug corporations are required to justify price increases and provide notice of price increases.
- Insurers are required to pass rebates directly on to consumers, reducing what they pay at the point of sale.
- Pharmacy Benefit Managers (PBMs) must report on what percentage of rebates they retain in order to contract with any insurer in Colorado.
- DOI will gain access to prescription drug data that will provide information and evidence for future policy recommendations.
“The cost of insulin can be prohibitively expensive to many of us with Type 1 Diabetes,” said Gail deVore, a small business owner from Denver. “Requiring the drug manufacturers to clearly justify price increases and notify Coloradans allows us to budget and plan how we can afford to stay alive.”
HB 1296 will help lawmakers and Coloradans understand why prescription drug costs are consistently rising and how drug corporations are taking advantage of consumers. It will also lead to lower out-of-pocket costs for some consumers by ensuring drug rebates that reduce the costs of some drugs get passed on to Coloradans at the pharmacy counter.
While nearly 1/3rd of Coloradans are skipping doses, cutting pills in half, or not filling prescriptions they need because of cost, drug corporations make higher profits than any other industry and spend millions on lobbying and billions on advertising. In a statewide poll of likely voters, 94 percent of Coloradans said the public should be informed about the factors causing the increases in their costs for prescription drugs.
Colorado Consumer Health Initiative is a nonpartisan, nonprofit group that represents 40+ Colorado health organizations with more than 500,000 health care consumer members advocating for high-quality, affordable and equitable health care. In 2018, CCHI received the “Get Wise” Consumer Protection award from the Department of Regulatory Agencies (DORA).