Republican lawmakers are moving to repeal state laws requiring drug companies to disclose financial and other information.

The legislators, with the backing of the pharmaceutical industry, say disclosure rules should be left to the federal government, which is moving to set up transparency requirements that are similar to Maine’s.

Democrats, meanwhile, are trying to block the efforts. They and advocates for affordable drugs say Maine’s disclosure laws save millions of dollars a year by keeping costs down and helping to negotiate lower medication prices for MaineCare patients.

The dispute split the Legislature’s Health and Human Services Committee last week, with all eight Republicans supporting two related bills and all five Democrats opposing them.

Debates in the full Legislature have yet to be scheduled, but the bills appear to be following the same track as a controversial health insurance reform bill that divided the two parties before it was passed by the Republican majority in a final vote Monday.

“The general theme this session is to stop making Maine more difficult than other states” for business, said Rep. Meredith Strang Burgess, R-Cumberland, sponsor of the repeal bills. “We certainly want to make sure we’re being smart (about regulation), but at the same time not going too far and letting the free market prevail.”

Rep. Sharon Treat, D-Hallowell, said the disclosure laws – most of which she sponsored – are under attack because they have successfully driven down drug costs.

“The bottom line is that repealing these things is absolutely about improving the bottom line of the drug companies and taking away tools of the government that right now help the state get some of the best rebates in the country and help prevent fraud,” Treat said.

One bill, L.D. 719, would repeal state laws that require drug companies to report to the state wholesale pricing information, amounts spent on drug marketing and the results of clinical trials.

A related bill, L.D. 1116, would repeal a Maine law that says pharmacy benefit managers who negotiate group prices with drug companies must disclose side payments and other financial information.

Maine’s disclosure laws for the drug industry are among the most comprehensive in the nation.

Strang Burgess, the sponsor of both bills and co-chair of the Health and Human Services Committee, said Maine’s requirements are overly burdensome on business.

“Maine has all these things that are a little more aggressive and confining,” Strang Burgess said. “It becomes a patchwork quilt (of varying rules) if you are a large company operating in different states.”

She said the state will not face any increase in drug prices if the bills pass, largely because the federal government is expected to require similar disclosures in the next year or two. “Other sources of information will be available,” she said.

National disclosure rules are part of the Affordable Care Act, which Maine and other states happen to be trying to repeal in court.

Strang Burgess also said the law requiring pharmacy benefits managers to disclose financial information has driven some group negotiators out of the state and reduced competition, actually making drug prices higher.

Treat, on the other hand, called the suite of proposals a gift to the drug industry, which failed to defeat the disclosure rules years ago in the Legislature and courts.

Treat agreed that the federal government is moving to require some public reporting, but said those rules are not yet in place and will not relieve states of their responsibility to guard against overcharging, kickbacks or fraud.

“Some of it is covered by the feds and some of it isn’t,” she said. “The federal government has not yet collected any data.”

Maine needs to keep requiring companies to disclose their average wholesale prices because the federal government has not yet set up any system for collecting that information, she said. The pricing disclosures help the state save millions of dollars a year in spending by MaineCare.

And the ability to negotiate savings is especially critical at a time when thousands of seniors may lose their drug coverage because of cuts to MaineCare, Treat said.

“As far as I’m concerned, this is being taken away by the majority at the behest of the drug industry so there are no checks and balances. We won’t have the means to go after them that we have right now,” she said. “Maine taxpayers and consumers will be the losers.”

A representative of the LePage administration testified in favor of L.D. 1116, and Gov. Paul LePage is expected to sign both bills if they pass in the coming weeks.

 

Staff Writer John Richardson can be contacted at 791-6324 or at: jrichardson@pressherald.com