Drug Price Gouging Law To Take Effect Oct. 1st

The Governor allowed it  to become law without his signature.



Baltimore, Md (KM) A law which would make certain types of price gouging for drugs illegal and give Maryland’s Attorney General the power to go after pharmaceutical companies which violate this law takes effect October 1st. The President of the Maryland Citizens Health Initiative, Vinnie DeMarco, says this new law will make a difference. “This is a strong law. It’s fully constitutional. And we believe that Attorney General {Brian} Frosh will use this law in a to make health care more affordable for Marylanders,” says DeMarco.

The law would target generic drug makers who increase the wholesale acquisition cost (WAC) of their drugs by 50% or more in one year; or if the WAC is more than $80, or if three or fewer drug makers are actively manufacturing and marketing the drug.

The measure would give authority to  Maryland’s Attorney General to require a manufacturer or wholesale distributor to produce any records or documents to determine if a violation has occurred. A civil penalty of up to $10,000 could be imposed for each violation, and or the companies could be required to lower the price of the generic drug for one year.

The Maryland Citizens Health Initiative has put up a website for citizens who feel they’ve been the victim of price gouging. (www.healthcareforall.com/hearmystory.) DeMarco says there have been citizens who ended up paying more  for their medications “like Epi-pens that parents need for their kids when they have allergies; like naloxone, that we need to prevent opioid overdoses from becoming deaths.”

He also says these stories from citizens will help Maryland enforce the new law against price gouging for prescription medications.

Last week, Governor Larry Hogan sent a letter to House Speaker Michael Busch, saying he’s  not going to sign the bill covering price gouging for drugs, but would let it become law without his signature. He said he was concerned about the constitutionality of the bill, especially when it comes to regulating interstate commerce and “penalizing a manufacturer outside of Maryland.” “These provisions would likely  violate the dormant commerce clause of the Constitution,” Hogan said in his letter.

“I am also concerned that the definition of ‘unconscionable increase’ and ‘excessive’ are vague and would likely not withstand a ‘vagueness’ challenge under the procedural due process concepts of the Due Process Clause of the Fourteenth Amendment,” the Governor’s letter continues.

“We’re really glad the Governor did not veto this bill. But we’re disappointed that he wrote a letter which makes the arguments that the pharmaceutical corporations made against the bill. And they’re all without any basis,” DeMarco responds.

Even though this is a lot of power being given to the Attorney General, DeMarco believes Brian Frosh will use it wisely. “He will bring cases where it’s warranted. But he has to show that the price increase was unconscionable, which is a tough standard. But if that happens, I believe he will take the case. But he certainly will be very judicious,” he says.


By Kevin McManus