disclose the costs and reasoning behind each price increase.
The California bill is set to have an impact on the status of these laws and the pharmaceutical industry’s transparency because of the state’s large market. Strict requirements of the new legislation may also be a significant point in turning the tide of price transparency.
The law will apply to any prescription drug that sells for a wholesale cost of $40 or more. This includes the medications purchased by the state government for the programs Medi-Cal and Medicare.
Pharmaceutical companies must notify the state, pharmacy benefit managers insurance companies 60 days before a drug price increases at least 16 percent over two years.
Manufacturers will also have to specify if the price hike will improve the effectiveness of the drug.