Everyone supports containing skyrocketing prescription drug prices but HB 4900, sponsored by Rep. Will Guzzardi (D-Chicago), would actually just make the problem worse for Illinois patients and our economy.
Generic medicines represent 89% of prescriptions filled in the United States but account for only 26% of spending on drugs. The reason that generics are so much less expensive than brand drugs and more affordable in the U.S. than in other developed countries is because of a very well functioning hyper-competitive market.
HB 4900 will supplant the free market competition that works so well for generics – 90% of all generic prescriptions filled with a copay are less than $20 - and will instead have the Illinois state government get into the business of setting prices. This intervention might be better suited or intended for costly brand drugs with constant price increases, but it does not make any sense for generics.
We need to increase competition, not chill it. To better serve the patients of Illinois, policymakers should explore enhancing the competition that has led to falling prices for generic medicines in the state. The overall price of generics fell more than 8% in 2016, and prices are down over 70% since 2008. Competition has led to generic prices falling for 18 straight months. Legislation ensuring these favorable trends continue is the best way to protect patient savings.
HB 4900 also threatens Medicaid savings. In 2016, generics saved the state of Illinois $9.6B total and $1.5B for Medicaid. This bill would strip those those savings.