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Lawmakers seek reasons for prescription drug costs

Oregon Rep. Rob Nosse plans to propose a law modeled after California's that requires pharmaceutical companies to explain steep increases in drug prices.

PARIS ACHEN/PORTLAND TRIBUNE - Left to right in front, Rep. Rob Nosse, Jesse O'Brien of OSPIRG and Sen. Elizabeth Steiner Hayward speak in February at the Oregon Capitol in Salem about legislation to reign in prescription drug costs.PORTLAND — New laws in California and Nevada aimed at shedding light on reasons for prescription drug prices could give state lawmakers the necessary momentum to pass a similar law in Oregon next year.

Rep. Rob Nosse, D-Portland said he plans to sponsor a bill in early 2018 that would be modeled after the new California law.

"I'm very excited that California passed a law that provides transparency around prescription drug prices," Nosse said. "It makes it easier for us to pass something here."

The new California regulations require health insurers and HMOs, beginning in October 2018, to report information about their organizations' pharmaceutical spending, prescribing habits and how those two factors affect premiums.

In January 2019, pharmaceutical manufacturers and distributors will be required to post a 60-day notice of any increase in price of 16 percent or greater in a two-year period for drugs that cost $40 or more, and to explain why patients are being charged more.

Nosse, whose day job is a labor representative for Oregon Nurses Association, proposed a more comprehensive law earlier this year that would have required drug companies to explain price increases and capped patient copayments on prescription medications, among other things.

That bill stalled in the House of Representatives after initial committee hearings.

Nosse's goal for 2018 is more modest.

Requiring pharmaceutical companies to disclose reasons for drug prices "at least would give us more insight in where else we could look to do something more comprehensive in the future," he said.

Oregonians for Affordable Drug Prices Now Coalition, made up of labor unions, insurers and consumer advocates, is backing the effort.

Transparency regulations have helped to control utility costs and insurance premiums in Oregon, said Mario Yedidia, senior research analyst at UNITE HERE, a labor union representing 275,000 workers in North America. UNITE HERE conceived the prescription drug price transparency law in California and is a member of the Oregon coalition supporting Nosse's proposal.

"We think transparency works, and the pharmaceutical market could use a dose of it," Yedidia said.

But Saumil Pandya, senior director in the policy and research dep. of PhRMA, said pharmaceutical costs represent only a fraction of overall health care spending. Policymakers should target insurer administrative and hospital costs if they want to reduce the cost of health care, he said.

Pandya, who is based in Washington, D.C., spoke during a Lund Report panel discussion on the cost of prescription drugs Wednesday in Portland,

Meanwhile, insurers and hospitals have expressed interest in the pharmaceutical transparency legislation.

"The panel today shows everybody points the finger at somebody else," Yedidia said. That is why any bill that sheds light on cost drivers is essential to making health care more affordable, he said.

Paris Achen
Portland Tribune Capital Bureau
email: pachen@portlandtribune.com
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