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 The bill overwhelmingly was approved by the Democratic-controlled
legislature on Monday and hailed by Maryland Attorney General Brian
Frosh as a way to check sharply higher prices for crucial generic
drugs.
The Maryland measure comes as concerns about rising U.S. drug costs
have been building for years. For example the 2015 decision by
Turing Pharmaceuticals to increase the cost of a life-saving,
anti-infection drug by 5,000 percent sparked widespread outrage.
The legislation takes aim at a generic drug market that makes up 88
percent of U.S. pharmaceutical sales and totaled $75 billion in
2015, according to Frosh's office.
"The market seems to bear it and so some of these manufacturers are
charging as much as they possibly can," Frosh said in a telephone
interview on Tuesday.
Governor Larry Hogan, a Republican, has not said whether he would
sign the legislation. His representatives did not respond to
requests for comment.
The bill allows Maryland's state authority on Medicaid, a federal
healthcare program for the poor, to let the attorney general's
office know when it sees patients being charged an "unconscionable
increase" for essential generic drugs.
The attorney general could then seek an explanation from the
manufacturer and sue to protect consumers, with a fine of up to
$10,000 for each violation. A judge could order the company to
reverse its price increase.
Generics are pharmaceuticals that are equivalent to a brand-name
drug. They usually are available after patent protections for the
original maker run out.
The bill did not touch on branded prescription drugs new to the
market since their manufacturers have development and patent costs
they are entitled to recoup, Frosh said.
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Maryland is the first state to pass a measure to combat excessive
price increases, according to the National Conference of State
Legislatures. Massachusetts, New York, Rhode Island and Tennessee
have similar legislation pending, the conference said.
The legislation would have a "chilling effect" on the generic market
in Maryland, said Chester Davis Jr., president of the Association
for Accessible Medicines, which represents generic drug makers.
Use of generic drugs had saved Maryland $3.7 billion in 2015, he
said.
"To focus on the side of the ecosystem that is actually driving the
savings and not the costs definitely seems counterintuitive to us,"
he said.
(Reporting by Ian Simpson; Editing by Daniel Trotta and Lisa
Shumaker)
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