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House of Representatives
Session of 2021 - 2022 Regular Session


Posted: February 11, 2021 09:05 AM
From: Representative Emily Kinkead
To: All House members
Subject: Prescription Drug Importation Study and Program Design
Unnecessarily expensive prescription drugs are driving up the already high cost of healthcare for people across Pennsylvania. Even worse, those unable to afford these life-saving drugs can be forced to ration and forego their medications. In a for-profit health care industry, drug companies need to make reasonable profits. Annual drug industry profits average 20 percent to compensate for the riskiness of drug research. But the aim of maximizing profits has crossed the line into profiteering at the expense of patients.
Under criticism, the drug industry repeats the same arguments: 1) high cost of research and development; 2) benefit justifies price; 3) market forces; and 4) regulating prices stifles innovation. But all four arguments lack validity. The cost of research and development is only 10 percent of the $1-2.6 billion figure that is claimed in industry-supported studies. More than 50 percent of important discoveries are made in independent academic centers, funded by taxpayers, and 85 percent of basic research is conducted in academic centers. The drug industry spends 1.3% of its budget on basic research, but 20-40 percent on advertisements and related activities. Multiple studies show no relationship between drug benefits and price. Drug companies enjoy monopoly-like conditions that discourage competition based on price. Finally, innovation is driven by independent investigators who will continue to conduct research even if drug prices fall.
That is why I will be introducing legislation directing the Pennsylvania Department of Health (DOH) to study the potential savings of importing less expensive prescription drugs from Canada and design a potential prescription drug importation program for our state when the study demonstrates savings for consumers.

Several states have already passed laws establishing programs that would import prescription drugs from Canada in hopes of passing along savings to consumers. Florida estimates their program would save consumers over $150 million annually.

Given new federal regulations for state importation programs, Pennsylvania has a considerable opportunity to help patients reduce their prescription medication costs. By directing DOH to conduct a study on the merits of an importation program in our state and design a potential program, we can ensure the legislature is in the best position possible should we wish to expediently implement a well-researched prescription drug importation program.

Please join me in supporting this legislation to help address some of the absurdly high drug prices in Pennsylvania.
(This legislation was previously introduced as HB 2225)

Introduced as HB833