Is Ohio the Frontline in the War on Rising Drug Prices?

By: Brandon M. Macsata, CEO, ADAP Advocacy Association

Ohio, which is the 7th most populous state in the United States, is quickly shaping up to be the battleground over the rising cost of prescription drugs. The Ohio Drug Price Relief Act is a voter initiated statute spearheaded by the Ohioans for Fair Drug Prices and the AIDS Healthcare Foundation (AHF). The ballot initiative attempts to bring state prescription drug costs -- such as medications covered under the AIDS Drug Assistance Program (ADAP) -- in the Buckeye State in line with the lowest price made available to the U.S. Department of Veterans Affairs.

If the Ohio Secretary of State's Office certifies the signatures -- in which 91,677 valid signatures of registered voters are needed -- then the next step in the process would be the Ohio General Assembly taking up the legislative measure. If state lawmakers failed to approve the legislation within four months, then the petitioners could attempt to place the initiative on a statewide ballot for referendum.

According to Ballotpedia:

“The Act would enact Section 194.01 of the Ohio Revised Code to require that notwithstanding any other provision of law and in so far as permissible under federal law, the State of Ohio shall not enter into any agreement for the purchase of prescription drugs or agree to pay, directly or indirectly, for prescription drugs, including where the state is the ultimate payer, unless the net cost is the same or less than the lowest price paid for the same drug by the U.S. Department of Veterans Affairs."[1]

Among other provisions, the Act also:

• Sets forth the title of the Act as "The Ohio Drug Price Relief Act."
• Sets forth Findings and Declarations and Purposes and Intent of the Act.
• Sets forth factors in determining "net cost."
• Authorizes state departments, agencies and other state entities to adopt administrative rules to implement the provisions of the Act.
• Provide that the Act shall liberally construed to effectuate its purpose.
• Provide that if any provision of the Act is held to be invalid, the remaining provisions shall remain in effect.
• Provide that if the Act is challenged in court, it shall be defended by the Attorney General.
• Declare that the committee of individuals responsible for circulation of the petition ("the proponents") have a direct and personal stake in defending the Act and any one or more of them may do so in court if challenged. Provide that the proponents shall be indemnified by the state for their reasonable attorney's fees and expenses in defending against a legal challenge to the Act. Provide that the proponents shall be jointly and severally liable to pay a civil fine of $10,000 to the state if the Act or any of its provisions are held by a court to be unenforceable, but shall have no other personal liability.
• Provide that in the event that the Act and another law are adopted by the voters at the same election and contain conflicting provisions and the Act received less votes, the non-conflicting provisions of the Act shall take effect.
• Require the General Assembly to enact any additional laws and the Governor to take any additional actions required to promptly implement the Act.[2]

The fight over the ballot initiative has pitted familiar foes against one another, with AHF leading the charge in favor of it, and the Pharmaceutical Research and Manufacturers of America (PhRMA) -- which is the pharmaceutical industry trade association -- trying to squash the measure. The main criticism of the measure is the lack of specifics, including over how it would be enforced.

Upon announcing that the signatures had been submitted to the Ohio Secretary of State, said AHF's president Michael Weinstein, “While we’ve seen ample evidence that there is seemingly no limit to the corporate greed of pharmaceutical companies, we also know that Americans are tired of feeling afraid every time they go to the doctor or it’s time to get a prescription filled. Astronomical prescription drug prices hurt everyone—except the drug makers’ bottom lines. This has got to stop.”[3]

There remains considerable uncertainty over the outcome of the petition effort, as well as what lies ahead with this ongoing debate in Ohio.

“As I had testified to the Ohio Ballot Board, this well-intentioned but sloppily written ballot measure will have no real effect on drug prices due to trade secrets and lack of a verifiable reference source," argued long-time Ohio resident Eddie Hamilton, Director of the ADAP Educational Initiative. "What it will guarantee is lawsuits whose legal fees will be borne by Ohio taxpayers."

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[1] Ohio Secretary of State,"2015-07-21 petition," July 21, 2015; Last viewed online at http://www.sos.state.oh.us/sos/upload/ballotboard/2015/2015-07-21-petition.pdf. 

[2] Ohio Secretary of State,"2015-07-21 petition," July 21, 2015; Last viewed online at http://www.sos.state.oh.us/sos/upload/ballotboard/2015/2015-07-21-petition.pdf. 

[3] BusinessWire, "AHF: Advocates Submit 171,205 Signatures for 2016 Drug Pricing Ballot Measure in Ohio," December 22, 2015. Last viewed online at http://www.businesswire.com/news/home/20151222006046/en.