Lawmakers Want To Hold Generic Drug Companies Accountable For So-Called 'Price Gouging'

Mar 5, 2018

Makers of generic pharmaceuticals are pushing back against an attempt to regulate prices in the industry.

Several Illinois lawmakers want to hold the companies accountable for what they call “price gouging.” The proposal would allow Illinois' attorney general to investigate when prices increase beyond a certain level. State Rep. Will Guzzardi – a Chicago Democrat – says these prices are often left unregulated because insurance covers the costs.

“The Medicaid program spends a whole lot of money on prescription drugs,” he said at a recent hearing. “And so when these companies engage in price gouging, that costs the state hundreds of millions of dollars that we’re spending directly on pharmaceutical companies.”

But opponents say regulation is not the answer.  They say small price increases help the industry stay afloat while bringing much-needed savings to others.

Carrie Hartgen is the vice president of state government affairs at the Association for Accessible Medicines,  a Washington, D.C.-based organization.  She says the proposal picks on the smaller, generic drug industry, ignoring large pharmaceutical companies that impose price hikes on patented drugs.

“Remarkably the bill dodges that critical challenge of bringing down prices of sole-source brand-name drugs, which can cost hundreds of thousands of dollars per year for a single patient," Hartgen said.

A spokesperson for the Association for Accessible Medicines took the argument a step further, saying in an emailed statement that regulations on generic drug makers will "do nothing to help" Illinois patients avoid high drug prices.

"If lawmakers are serious about meaningful change, they won’t chill generic competition and instead work to lower the high brand drug prices that are responsible for out of control health care costs," spokesman Allen Goldberg wrote.

Lawmakers could take a vote on the proposal in the coming weeks, after giving it initial approval in the House Human Services Committee last week.