Gov. Mills signs 4 bills to reduce medication prices, including buying from Canada

AUGUSTA — Gov. Janet Mills signed a package of bills Monday that aim to reduce prescription drug prices, including one measure allowing the state to act as a drug wholesaler to purchase cheaper medications from Canada.

Mills said the bills she signed into law will help address what she described as “unsustainable” and “intolerable” price increases that force many Mainers to choose between paying for medications or other necessities.

“Today I think Maine takes a really major step forward in tackling the skyrocketing prescription drug prices we’ve seen and standing up for the interests of Maine people and Maine consumers,” Mills said at a signing ceremony in her State House office. The new laws will take effect 90 days from the Legislature’s adjournment on Thursday.

But various aspects of the new laws focused on drug prices and industry transparency will take time to implement. And perhaps the highest-profile component of the package – importing lower-priced drugs from Canada – is contingent on federal approval, which is not guaranteed.

Lowering prescription drug prices has long been a bipartisan issue in Maine, which has one of the oldest populations in the country and a large population of lower-income or fixed-income residents. Each of the bills Mills signed passed with either unanimous or overwhelming support in both the House and Senate.

One of the laws would direct the Maine Department of Health and Human Services to design a drug importation program from Canada in which the state either acts as the wholesaler or contracts with a licensed wholesaler. The program, which is subject to federal approval, would require that all imported drugs meet Food and Drug Administration safety and health standards.

Vermont passed a similar law last year and has since been joined this year by Florida and Colorado. In each case, the state or designated contractors would act as the wholesale purchaser of certain drugs and then work with insurers, pharmacies and other groups. Consumers would then see presumably lower prices at the check-out counter.

“For too long, Mainers have seen their prescription drugs skyrocket because politicians were too afraid to take on Big Pharma,” bill sponsor and Senate President Troy Jackson, D-Allagash, said during the signing ceremony. “We are not. Today that changes. With this prescription drug reform package, we are delivering long overdue relief to Mainers.”

Another of the laws would require manufacturers of drugs that increased in price 20 percent or more during a calendar year to disclose the reasons for that jump. A Maine Prescription Drug Affordability Board, meanwhile, created by another law, would set spending targets on drugs for public agencies.

In an effort to reduce potential profiteering, a fourth law imposes tighter financial disclosure requirements on the pharmacy benefit managers who act as the middleman between insurance providers and drug manufacturers to pass along savings to consumers or insurers.

Jackson said the personal stories shared by Mainers who came to Augusta “helped get these bills across the finish line.” Leaders of AARP Maine, whose members were a frequent presence in State House hallways throughout the legislative session, agreed that those stories likely made a difference.

“Our elected leaders clearly recognized that prescription drug price gouging is not a Democratic or a Republican problem,” Lori Parham, state director for AARP Maine, said in a statement after the bill signing. “This issue is about fighting for people’s lives, and putting people before profits.”

Trish Riley, a Brunswick resident who is executive director of the National Academy for State Health Policy, said her organization has been working with states across the country on these issues and even provided model legislation that can serve as a blueprint for locals bills. Maine is the first state to enact all four bills.

“I do think what is unique about Maine is the comprehensiveness of the four bills,” said Riley, who served as director of Gov. John Baldacci’s Office of Health Policy and Finance and headed the Dirigo Health program.

Riley said the pharmacy benefits manager law has the potential to reduce drug costs in the near term because it will require those middlemen to pass along to customers savings that are received from manufacturers in the form of rebates or other deals. The law also imposes a “fiduciary duty” on pharmacy benefits managers to work in the interests of consumers, not drug manufactures or insurers, which has been a recurring criticism of the management industry.

The drug importation law will take longer and will have to clear the first critical hurdle: gaining approval from the U.S. Department of Health and Human Services. But now that Mills has signed the bill into law, Maine can join the collective of policy makers from Colorado, Florida and Vermont who are working together on a unified proposal to federal officials.

However, federal approval is not a slam dunk.

The current secretary of Health and Human Services has questioned the logistics and cost-savings of drug importation programs. But Secretary Alex Azar’s boss, President Trump, has expressed strong support for the idea and directed him to work with Florida on the law.

Riley said the three states – plus Maine after Monday – could exert some “collective power” to petition the federal government.

“The states have decided to work together collaboratively to try to resolve as many issues as they can before going to the federal government and asking for their approval,” Riley said. “It has never been done before.”

Opponents of the importation bill had warned that the legislation could allow unsafe drugs to flow into Maine.

“Importation sounds like an easy solution to this problem, but it endangers American patients,” Amelia Arnold, president of the Maine Pharmacy Association, said in April testimony to a legislative committee. “Congress is currently considering policy proposals such as fast-tracking the approval of generics and regulating the role of pharmacy benefit managers. These initiatives and others may lower the prices of prescription drugs without compromising patient safety.”

But Maine’s new law would only allow importation of drugs approved by the FDA and would not allow consumers to order drugs online from non-U.S. companies. Another criticism of drug importation measures is that it could create shortages in Canada, where the government negotiates with manufacturers on drug prices.

But Florida Gov. Ron DeSantis said two weeks ago that since his state’s importation bill passed, some manufacturers already had expressed an interest in working out a better price deal directly with the state, according to a report on National Public Radio last week.

The importation bill signed Monday in Augusta would allow Maine to collaborate with other states – something that Mills said makes sense to her.

“Multi-state purchasing is a smart idea,” Mills said. “If we can get it done with the federal government’s approval, why not?”

Sen. Heather Sanborn, a Portland Democrat who sponsored the pharmacy benefits manager bill, said the bipartisanship stemmed from lawmakers starting “from a place where we all agree.” And in this case, there was unanimous agreement that all Mainers should have affordable access to life-saving medications.

“This session, my committee set out to examine this complicated issue from every angle,” Sanborn, co-chair of the Health Coverage, Insurance and Financial Services that worked on all four bills, said in a statement. “Our goal was to figure out how we can pull every lever possible to lower the cost of prescription drugs and hold middlemen and drug companies accountable for driving up costs.”