California AG, State Lawmaker Want To Ban Drug Company Price Collusion


California Attorney General Xavier Becerra and California Assemblymember Jim Wood on Wednesday unveiled new legislation to help curb the increasing drug prices in California.

According to the description, Assembly Bill 824 would prohibit pharmaceutical agreements in which a drug company transfers anything of value to delay a competitor’s research, marketing, or sale of a competing version of its drug. These agreements, known as "pay-for-delay" agreements, have significantly contributed to price increases for prescription drugs in California.

"Patients and consumers deserve to be free of unfair practices and price manipulation within the pharmaceutical industry," said Becerra. "This legislation is a crucial step in combating predatory pricing practices, like 'pay-for-delay' schemes, by drug companies and in defending access to affordable care."

"When drug companies use these quiet 'pay-for-delay' agreements with generic drug manufacturers it hurts consumers twice – once by delaying the introduction of an equivalent generic drug that is almost always cheaper than the brand name and again by stifling additional competition when multiple generic companies begin producing even less expensive generic equivalents," added Wood. "This is just wrong."

Both men claimed this legislation is the first state legislation in the United States to tackle pay-for-delay agreements, providing California with the opportunity to continue to be a leader in pay-for-delay litigation.


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