Oklahoma Senate Bill 734 Would Base Drug Prices on Those in Canada

Date: March 5, 2021 | Country: CANADA-ONTARIOUNITED STATES | Region: NORTH AMERICA | Type: Reference Pricing (IRP) | Keywords: #bill734 #healthchoice #insurancepremiums 
#negotiations #pharmacy #phrma #policy #pricecaps #savings

PRICENTRIC BRIEF:

  • Although it’s still up for consideration by the Senate, the Oklahoma Senate Appropriations Committee has approved Bill 734, authored by OK State Senator Greg McCortney, which would benchmark prescription drug prices in Oklahoma based on those found in Canada
  • Bill 734 would set the upper limit on the price of the top 250 drugs covered by Health Choice, an insurance plan covering Oklahoma’s state and local employees, based on the price drug companies pay in Canada, and Oklahoma insurance companies and pharmacies would be able to negotiate down from that pricing level
  • Citing price differences between the United States and Canada, specifically for insulin, McCortney commented, “The total projected savings just for Health Choice for just [the] top 25 drugs would be more than $52 million in the first year—and keep in mind this bill would cover the top 250 drugs”

 

THE DETAILS

OKLAHOMA CITY, OK, United States – The Oklahoma Senate Appropriations Committee has approved Bill 734, authored by OK State Senator Greg McCortney, which would benchmark prescription drug prices in Oklahoma based on those found in Canada.

The Bill will now go to the Senate for full consideration.

Bill 734 would set the upper limit on the price of the top 250 drugs covered by Health Choice, an insurance plan covering Oklahoma’s state and local employees, based on the price drug companies pay in Canada. Further, Oklahoma insurance companies and pharmacies would be able to negotiate down from that pricing level.

Citing price differences between the United States and Canada, specifically for insulin, McCortney commented, “The total projected savings just for Health Choice for just [the] top 25 drugs would be more than $52 million in the first year—and keep in mind this bill would cover the top 250 drugs. This bill will save money for individual insurance customers and for taxpayers.”

As an example, McCortney highlighted AbbVie’s Humira (adalimumab), for which Health Choice reportedly pays $2,442 per person. However, under Bill 734, the savings for Humira would be approximately $13.5 million in the first year alone.

In addition, the Bill would require insurance companies to pass along savings to customers.

According to McCortney, Bill 734 is poised to reduce prices by an average of 200% on drugs Oklahomans most use and could save the average Oklahoman over $250 a year in insurance premiums.

However, the Bill has received criticism from the industry. Industry association PhRMA warned that enacting the price controls in Bill 734 would restrict access to innovative medicines, delaying patient access and leading to fewer treatments being available. Instead, PhRMA called for solutions to deliver quick savings to Oklahomans that do not impede innovation.

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