Two Senate committees have scheduled a joint public hearing for 10 a.m. Wednesday, May 31, on the prices of prescription drugs.
Sen. John J. Marchi, chairman of the Senate Committee on Corporations, Authorities and Commissions, and Sen. George D. Maziarz, chairman of the Senate Committee on Aging, will conduct the hearing in Hearing Room B of the Legislative Office Building in Albany.
The Business Council may testify at the hearing, said Elliott Shaw, director of government affairs at The Council and its specialist in health-care issues.
The Business Council has previously expressed reservations about one related bill, Sen. Marchi's proposal (S.6068-B) to have state government set prescription drug prices.
In a May 16 letter to Senate Majority Leader Joseph Bruno, Business Council President Daniel B. Walsh praised Sen. Marchi for his "distinguished record of landmark legislation on behalf of New Yorkers," but added that the price-control bill "has a number of shortcomings."
Lower retail prices for prescription drugs in some foreign countries, which is driving some calls for price controls, has an appeal that is illusory because citizens in those countries also support prescription drug costs through taxes, Walsh wrote.
"Those prices are result of a single-payer system where patients pay for their health-care system both through taxes as well as what they pay at retail," he noted.
Walsh also rejected criticism of pharmaceutical industry profits, pointing out that Princeton University economist Uwe Reinhardt recently noted an an almost direct dollar-to-dollar correlation between profits and R&D investment in the pharmaceutical industry. "Do we believe the industry's R&D investments are too large?" Walsh asked.
Again citing Reinhardt, Walsh argued that policymakers should seek "a safety net for those who have the highest pharmaceutical costs without choking off the world's foremost engine of scientific product development, namely the American pharmaceutical manufacturers."
He added: "There is no pharmaceutical research industry to speak of in Canada, where the system is completely controlled by government pricing."
The pharmaceutical industry plays a major role in New York's economy. It employs tens of thousands of New Yorkers, pays $110 million in state and local taxes, and another $100 million in de facto taxes through Medicaid rebates, Walsh wrote. The industry also pays nearly $30 million in rebates through the state's EPIC program, which gives senior citizens reduced-cost prescription drugs.
In the letter, Walsh said The Council would work with the Senate to develop a "creative pro-market solution" to concerns about high prescription drug prices.