N.J. bill would create drug price control panel

Measure, hailed by advocates, likely to face heavy opposition from pharmaceutical industry

By: - November 9, 2021 10:06 am

The Trenton Statehouse (Getty Images)

A Senate panel advanced a bill over the objections of business groups Monday that would create a public board with the ability to cap prescription drug prices.

The measure, sponsored by Sen. Troy Singleton (D-Burlington) and Senate Majority Leader Loretta Weinberg (D-Bergen), would create a board with regulatory powers not yet seen in New Jersey. It cleared the Senate Health, Human Services and Senior Citizens Committee in a party-line vote.

The move comes as Democrats in Congress claim to have sealed a deal to lower drug costs for seniors by capping out-of-pocket Medicare costs, a plan that is part of a $1.75 trillion spending bill facing an uncertain future. 

The New Jersey legislation is being hailed by progressive groups and advocates, who called the measure sorely needed and urged lawmakers to advance the bill without delay.

“High prices only hurt American families. This is unsustainable,” Maura Collinsgru, health care program director for New Jersey Citizen Action, said in a statement. “We need prompt action from our lawmakers to help rein in the unfair pricing practices and ensure the drugs people need are accessible and affordable for all.”

The governor, Senate president, Assembly speaker, and attorney general would each appoint a single member to the board, with the fifth chosen jointly by the Senate president and speaker.

The bill would also create a 27-member advisory council composed of representatives from various sectors of the health care and pharmaceutical industries, along with insurers, advocates, subject-matter experts, and members of the public.

Those appointed to the council would each serve three-year terms, with appointment powers spread between the governor, Senate president, and Assembly speaker.

The committee’s five Democrats voted to advance the bill, while Republican Sens. Holly Schepisi and Bob Singer voted against. GOP Sen. James Holzapfel was not present.

The proposal has seen opposition from business groups, who raised alarms over the prospect of price controls, warning they would push pharmaceutical research out of New Jersey. Trade association Health Care Institute of New Jersey says 11 of the world’s 20 largest pharmaceutical companies maintain a headquarters or significant presence in the Garden State.

“In a recent CNBC study, New Jersey ranked among the bottom six states in the nation for the cost of doing business,” New Jersey Business and Industry Association Chief Government Affairs Officer Chrissy Buteas said in prepared testimony to the committee. “A punitive tax on the pharmaceutical industry could only make these statistics more grim for patients and providers, and small businesses will be the first to feel the impact.”

The board would also be responsible for conducting studies on prescription drug price controls and other cost-saving measures used in other states.

The bill would require the panel to identify an independent funding source within 18 months of its creation.

The measure still has a lengthy road to becoming law. It will also need approval from the Senate Budget Committee before going before the full chamber.

The Assembly Financial Institutions and Insurance Committee advanced the measure in a party-line vote in June, though it will also need approval from the Assembly Appropriations Committee, which has yet to schedule a November meeting.

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Nikita Biryukov
Nikita Biryukov

Nikita Biryukov most recently covered state government and politics for the New Jersey Globe. His tenure there included revelatory stories on marijuana legalization, voting reform and Rep. Jeff Van Drew's decamp to the Republican Party. Earlier, he worked as a freelancer for The Home News Tribune and The Press of Atlantic City.

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