Big pharma antes up in California legislative discount drug fight

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Pharmaceutical companies have pledged millions of dollars to head off a consumer non- profit group in a California state legislative battle over discount drugs.
According to the office of the California Secretary of State, the pharmaceutical industry has raised $8.6 million so far to fight proposed ballot initiatives in that state that would mandate lower drug prices.
Johnson & Johnson, Pfizer and GlaxoSmithKline have already donated $1.3 million each and Abbott Laboratories, Amgen, AstraZeneca, Eli Lilly, Novartis and Wyeth donated $650,000 a piece.
Currently, the pharmaceutical industry and the non-profit healthcare group Health Access are promoting rival initiatives in the California state legislature -- initiatives that could end up on a special election ballot in November, a Los Angeles Times report published today said.
The proposed California Rx program, negotiated between drug makers and Governor Arnold Schwarzenegger agrees to provide discounted drugs to California residents earning less than three times the federal poverty level (totals that come to $28,710 for an individual and $58,050 for a family of four). Projected savings under the plan would be around 40 percent off the retail price of prescription drugs. Almost 5 million Californians would qualify for California Rx if approved by voters.
The rival Health Access plan proposes requiring discounts for anyone earning less than four times the federal poverty level ($38,200 for an individual or $77,400 for a family of four). People with incomes above that who spend a disproportionate amount on medical expenses would also be eligible. Projected savings under the Health access plan would be about 60-65 percent. Nearly 10 million California residents would qualify for savings under the Health Access plan if approved.
What is disturbing to the pharmaceutical industry, according to today's Times report, is that drug companies that do not consent to the discounts under the Health Access program could be shut out of the state's Medi-Cal program, which annually buys $3 billion worth of drugs for the poor.
Drug makers said California fight comes at a critical time.
"We take it as such a serious threat to the health and welfare of the pharmaceutical industry that we have to make a stand here," Jan Faiks, a vice president at the Pharmaceutical Research and Manufacturers of America, told the Times.


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