Democratic Legislators Announce Plan Against Prescription Drug Price Spikes

Liz Gullett

Democratic Legislators Announce Plan Against Prescription Drug Price Spikes

Aug 25, 2017

This week, members of the House and Senate Democratic caucuses announced their plan to stop prescription drug price spikes in Michigan. This is quickly becoming a major issue nationwide as almost 60% of American adults take prescription drugs. According to the American Medical Association, on average in 2016 drug prices increased by 10%, which outpaces inflation and wage growth. This marks the third straight year of double-digit increases in drug prices. “The rising cost of health care is a major concern to many residents in the state. While there are many causes, the Democratic members highlight the cost of prescription drugs,” stated Sean Mann of MLC.

Under the proposal, a Prescription Drug Consumer Protection Board would be established, composed primary of consumer advocates. The thirteen-member board would also include drug purchasers and state department heads. Drug manufacturers would be required to submit documentation to the board justifying price increases above 10% in one year, or 30% over five years. Drug manufacturers that refuse to submit the required information to the board would be subject to penalties of $100,000 per day for failure to comply.

The proposal includes strengthening the Michigan Consumer Protection Act to require the Attorney General to investigate any drug manufacturers that the board believes have subjected consumers to grossly excessive price spikes. If there is probable cause found, the Attorney General could take legal action, including seeking significant financial penalties.

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