How Can States Provide Affordable Pharmaceuticals to the Underserved?

Abstract

Advocates of drug price restrictions in the U.S. argue that pharmaceutical companies operate in an unregulated market, free to charge whatever price the market will bear. The pharmaceutical industry insists that these large profits are justified for investments toward discovering new life saving medicines. As innovation wanes, marketing costs soar, and drug profits rise, public interest advocates and state leaders are challenging this justification. This article examines current problems associated with the ability to procure affordable medicines, and examines mounting tensions between the federal government and the states, particularly regarding the states' ability to negotiate lower prices with drug manufacturers in light of the recent Medicare changes. It provides a brief survey of efforts underway to secure affordable pharmaceuticals for state's residents, addressing the history and feasibility of using compulsory licensing for producing affordable life-saving drugs with respect to public health, constitutional, eminent domain, and anti-trust issues.

Reducing Branded Prescription Drug Prices: A Review of Policy Options

“…Empower government to purchase patents at auction and place them in the public domain, or compel sale of patents based on quality and extent of use of drug 35-37 2. Adopt state-level compulsory licensing if the drug is "essential," priced high to state residents' means, and whether any circumstances explain the high price 38 3. Eliminate patent thickets by removing the exclusive right to use inventions in upstream research in favor of a system that gives the freedom to use inventions as long as the patent owners receive remuneration 39 4.…”