Sen. Tipping introduces bill to increase transparency of prescription drug pricing
AUGUSTA — On Thursday, April 27, Sen. Mike Tipping, D-Orono, introduced LD 1395, “An Act to Increase Transparency Regarding Certain Drug Pricing Programs,” before the Joint Standing Committee of Health Coverage, Insurance and Financial Services. The bill would require hospitals to provide reports with hospital and drug data relating to their participation in federal drug pricing programs.
“Without clear data, it is impossible to know how the 340B program is operating in Maine. Maine’s hospitals are a vital part of our communities and provide needed medical care and services to thousands of Maine people every day,” said Sen. Tipping. “However, requiring transparency is prudent and necessary to better understand how this program is operating in Maine. The information being requested is already required to be compiled in the case of a federal government audit and would not require a significant administrative burden.”
The 340B Drug Pricing Program, established by the U.S. federal government in 1992, mandates that drug manufacturers supply outpatient drugs to eligible healthcare organizations. The goal of the program is to help these organizations extend scarce federal resources, enabling them to serve more eligible patients and offer more comprehensive services. Entities benefiting from this program include health care providers that receive certain federal grants, such as federally qualified health centers (FQHCs), family planning clinics, and Ryan White HIV/AIDS program grantees, as well as certain types of hospitals that provide care to low-income and medically underserved individuals. The goal of the bill is to require hospitals to provide reports about their use of the money from the drug pricing program, to ensure it is being used as intended.
Noah Nesin, Chair of the Maine Prescription Drug Affordability Board, also testified in favor of this bill.
“As the 340B program has been expanded to include other entities, concern has grown over cost and the use of these revenues,” said Nesin. “Our report includes references and quotes related to this concern, one of which points out that in 2021 discounted purchases reached $43.9 billion, with hospitals accounting for 87% of those purchases. We do not argue that those funds are being misused, or that hospitals in Maine don’t need additional revenue streams beyond those generated by patient care. But it is prudent to require transparency about those funds in order to better inform public policy.”
The bill faces further action in committee.
