Governor Kills Prescription Drug Affordability Board Proposal

A five-year effort to curb drug prices through a Prescription Drug Affordability Board just faced its third veto between two governors, as Abigail Spanberger formally rejected the measure Tuesday.

A service window at a pharmacy. (Photo by Charlotte Rene Woods/Virginia Mercury)

The proposal had evolved over the years: first as a board to set payment limits on drug prices, and later as an advisory panel to help ensure federal drug pricing caps already in place for Medicare recipients are applied to state-regulated health insurance plans.

This year, the concept took on a new name, “The Affordable Medicine Act,” and cleared this legislative session with stronger bipartisan support. But it fell short of winning the governor’s approval because of its cost and unproven effectiveness.

“During this past General Assembly session, the legislature took important steps toward lowering healthcare costs by passing bills to hold pharmacy benefit managers accountable and to require health insurance carriers to offer plans that cap monthly out-of-pocket costs for drugs. I was proud to sign these critical bills into law,” Spanberger said.

“However, I am vetoing HB483 and SB271 because evidence from other states clearly shows that Prescription Drug Affordability Boards (“PDABs”) do not achieve this goal. They are expensive undertakings that other states have either repealed or are considering repealing due to costs and ineffectiveness.”

Del. Karrie Delaney, D-Fairfax, who carried the House version, said this year’s iteration mirrored cost-capping steps endorsed by both Presidents Joe Biden and Donald Trump’s administrations.

With federal approvals already applied to 10 drugs since the beginning of this year, another 15 are expected to take effect next year.

Sen. Creigh Deeds, D-Charlottesville, who sponsored the Senate’s twin of the bill, said he feels “confident an effort will be made next year” to revive the idea and get it over the goal post.

The evolution of the proposal and the stronger bipartisan support it picked up along the way support Deeds’ outlook.

Del. Michael Webert, R-Faquier, had previously voted down the board. This year, he made a passionate floor speech in support of it.

“Our healthcare system at various points… whether it’s your health insurance, whether it’s your prescription drugs or just going to the hospital — it’s all expensive,” he said. “This bill is working towards a solution.”

Webert said Tuesday that he plans to help “bring as many voices to the table as possible” to bring the bill back next year.

Though the bill aligns with Spanberger’s stated goals of improving healthcare affordability, she has never specifically endorsed the board.

“I want to make sure that whatever we might implement in the future will be a best practice based on the successes or challenges that other states have faced,” she said on the campaign trail last year in response to questions about whether she would support PDAB as governor.

Before her veto this year, she sought a reenactment clause amendment — a move advocates said nullified the board for this year — that lawmakers rejected.

“After all that bipartisan collaboration and the Spanberger campaign’s heavy emphasis on ‘affordability,’ it is stunning that she would veto a bipartisan mechanism designed to help working Virginians,” Sens. Bill Stanley, R-Franklin, David Sutterlein, R-Roanoke, and Mark Peake, R-Lynchburg, said in a joint statement Tuesday in response to the veto.

If the measure had earned the governor’s approval, Virginia would have become the 12th state to establish one. But the concept is still novel and has drawn skepticism from a range of opponents, including former Gov. Glenn Youngkin, who vetoed it twice.

Critics have pointed to how the boards have had little to show for their work since Maryland became the first state to create one in 2019.

Maryland’s board, which was stalled by a former governor and the 2020 COVID-19 pandemic, just recently set a price cap on a drug. Late last year, Colorado’s board set a cap and has since been tangled in a lawsuit by the drug’s manufacturer.

Pharmaceutical associations and Youngkin cautioned that the boards stifle innovation or discourage certain companies from putting down stakes in the state.

Pharmaceutical Manufacturers of America on Tuesday called the veto “the right step to protect Virginia patients from a flawed policy.” Freedom Virginia claimed her veto of the new iteration of the bill goes against her support for the concept, citing drug cost savings that Spanberger voted for while she was still a member of Congress.

Webert said that he understands that “profit is necessary to drive innovation, but corporate stewardship is essential.”

“The healthcare industry should view this bill and others like it as a warning sign that people are not merely an industry or a revenue stream, but human beings deserving of dignity and care,” he said.

Spanberger recently signed other healthcare bills, including one by Delaney to cap insulin costs and diabetes equipment.

With just days to go until her bill action deadline, Spanberger and state lawmakers are still deliberating the state budget, which must be finalized by June 30.

Funding earmarked for healthcare costs makes up about a third of it and will have to stretch across competing needs.

Here’s how Va. lawmakers suggest the next state budget handle federal health care funding fallout

Roughly 33,000 Virginians have lost their Affordable Care Act insurance after Congress’ failure to renew expired subsidies.  Forthcoming federal changes to Medicaid will make thousands more Virginians vulnerable to losing that form of insurance.

The governor and the legislature have been at a budget impasse since late April amid debate over whether or not to renew tax exemptions for data centers. This week, Spanberger directed state budget officials to update revenue forecasts to help shape negotiations.

The new budget is slated to take effect on July 1.

by Charlotte Rene Woods, Virginia Mercury

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