This bill establishes a new Prescription Drug Affordability Board in Department of Consumer and Business Services to review prices for prescription drug products meeting specified cost criteria.
The financial impact of this measure is $1,786,192 of General Fund with 6 positions. The Prescription Drug Affordability Board is to annually assess fees to be paid by manufacturers of prescription drugs. Fee levels are to be set at an amount that allows the Board to administer this measure. Fees are based on a manufacturer’s share of gross revenue from the sale of prescription drugs in Oregon. Fee moneys are to be deposited in the Prescription Drug Affordability Account, a newly established subaccount in the Consumer and Business Services Fund, with moneys in the account continuously appropriated to the Board to carry out this measure. The Board is to reimburse this money without interest when sufficient fee revenue is available, but no later than June 30, 2023. The repayment of $1.7 million in two years will be a big increase in costs that companies can’t absorb and will result in higher drug prices.
In 2018, the Legislative Assembly passed HB 4005, the Prescription Drug Price Transparency Act, which requires pharmaceutical manufacturers and insurers to report specified prescription drug cost and price information. In 2019, Maryland became the first state to establish a Prescription Drug Affordability Board (PDAB). The PDAB takes inspiration from states’ regulation of consumer payment rates for essential services, such as clean drinking water, safe and consistent electricity, and public transportation, where states act to ensure that these necessary services are affordable to the public. Senate Bill 844 A establishes a Prescription Drug Affordability Board to review prescription drug prices and establish upper payments for specified categories of drugs. Socializing prescription drug will increase the cost and depress new drug initiatives. Established price limits will auto adjust with CPI. If the board review of cost leads to an affordability challenge or to health inequities in communities of color, then the board may establish an upper payment limit.