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2001 SESSION

010230986
HOUSE JOINT RESOLUTION NO. 760
Offered January 17, 2001
Establishing the Prescription Drug Advisory Commission.
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Patrons-- Welch, Dudley and Purkey
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Referred to Committee on Rules
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WHEREAS, prescription drug costs represent the fastest-growing element of health care expenditures and are a driving force in rapidly-increasing hospital costs and insurance rates; and

WHEREAS, by charging the citizens of the Commonwealth excessive prices for prescription drugs, pharmaceutical companies are denying Virginians access to medically necessary health care and are thereby threatening their health and safety; and

WHEREAS, many Virginians are admitted to or treated at hospitals each year because they cannot afford the drugs prescribed for them; and

WHEREAS, many other Virginians must enter expensive institutional care settings because they cannot afford the prescription drugs that could have supported them outside of an institution; and

WHEREAS, all Virginians are threatened by the possibility that when they are in greatest need for medically necessary prescription drugs they may be unable to afford their doctor's recommended treatment; and

WHEREAS, citizens of the Commonwealth and of the United States pay the highest prices in the world for prescription drugs, which prices result in high profits for pharmaceutical companies; and

WHEREAS, the prices paid by citizens of the United States for prescription drugs are between 23 and 198 percent higher than those paid by citizens of Mexico and Canada; and

WHEREAS, retail prices for prescription drugs in the United States are more expensive when purchased for human consumption than when purchased by animal owners for their pets; and

WHEREAS, countries in Western Europe, where prescription drug prices are 20 to 50 percent less than in the United States, are home to significant pharmaceutical research; and

WHEREAS, while the pharmaceutical industry defends high drug costs on grounds that its profits have made the United States the world leader in the development of new drugs, the number of new drugs developed between 1990 and 1994 in the United States (84) was less than the number developed in Western Europe (94) and was only seven more than the number developed in Japan (77); and

WHEREAS, citizens finance a greater share (57 percent) of the cost of research and development for new drugs than does the pharmaceutical industry (43 percent), while the tax burden on the drug industry is an average of 41 percent less (16.2 percent) than that of other industries (27.3 percent); and

WHEREAS, it is unconscionable that the citizens of the Commonwealth pay an average of twice as much for prescription drugs as do residents of the neighboring nations of Canada and Mexico, and that senior citizens in the Commonwealth are often faced with the choice of choosing between food, heat, and life-saving medicine; now, therefore, be it

RESOLVED by the House of Delegates, the Senate concurring, That the Prescription Drug Advisory Commission be established. The Commission shall be composed of 19 members, which shall include 10 legislative members and nine nonlegislative members as follows: six members of the House of Delegates, to be appointed by the Speaker of the House, in accordance with the principles of proportional representation contained in the Rules of the House of Delegates; four members of the Senate, to be appointed by the Senate Committee on Privileges and Elections; four citizens to be appointed by the Speaker of the House of Delegates, of whom two shall represent the interests of senior citizens, one shall be a member of the health care community who is authorized to prescribe drugs, and one shall be a licensed pharmacist engaged in the practice of retail pharmacy; three citizens to be appointed by the Senate Committee on Privileges and Elections, of whom one shall represent the interests of senior citizens, one shall be a member of the health care community who is authorized to prescribe drugs, and one shall be a licensed pharmacist engaged in the practice of retail pharmacy; and two citizens to be appointed by the Governor, one of whom shall represent the interests of senior citizens and the other shall be either a member of the health care community who is authorized to prescribe drugs or a licensed pharmacist engaged in the practice of retail pharmacy.

The Commission shall study access to and the pricing of prescription drugs in the Commonwealth. In connection with this study, the Commission shall recommend (i) maximum retail prices for prescription medications to be sold in the Commonwealth, which prices shall be commensurate with the prices thereof in Canada and Mexico and shall not place an undue burden on the citizens of Virginia, (ii) procedures for setting maximum retail prices of prescription drugs sold in the Commonwealth, (iii) a process to monitor retail prices of prescription drugs sold in the Commonwealth, and (iv) guidelines to bring into compliance any person who sells prescription drugs for more than their maximum retail prices.

The direct costs of this study shall not exceed $17,000.

The Division of Legislative Services shall provide staff support for the study. Technical assistance shall be provided by the Department of Human Resource Management. All agencies of the Commonwealth shall provide assistance to the Commission, upon request.

The Commission shall complete its work in time to submit its written findings and recommendations to the Governor and the 2002 Session of the General Assembly as provided in the procedures of the Division of Legislative Automated Systems for the processing of legislative documents.

Implementation of this resolution is subject to subsequent approval and certification by the Joint Rules Committee. The Committee may withhold expenditures or delay the period for the conduct of the study.