When transparency goes too far, “it can actually harm competition and consumers,” the FTC wrote in 2015
A last-minute bill passed in the Nevada legislature could end up damaging competition in the state’s health care markets if signed into law by Gov. Brian Sandoval (R-NV).
The bill, SB 539, contains similar language to a bill previously vetoed by the governor, SB 265. This time, however, Sandoval has indicated he plans to sign the bill.
But the president of the Council for Citizens Against Government Waste, Thomas Schatz, penned a letter to Sandoval pointing out the similarities between the bills and the dangers posed by it.
Once again the legislation would require pharmaceutical manufacturers, and now pharmacy benefit managers (PBMs), to provide costs, profits, pricing, coupon, and rebate information, much of which would be proprietary and if exposed would disrupt and harm the sensitive negotiations that occur throughout the drug supply chain that lower drug costs.
The bill again focuses on reporting the wholesale acquisition cost (WAC) and the history of any WAC increases. The WAC is similar to a list price and is not a true representation of drug prices that are negotiated and paid for by the patient at the pharmacy.
Just as SB 265 would not have lowered drug costs, neither will this legislation.
In July 2017, the Federal Trade Commission published a commentary on a similar issue in which the Office of Policy Planning argued that so-called “price transparency” is not actually a good thing for consumers and “can harm competition in any market, including in health care markets.”
Schatz’s letter, written on behalf of Nevada consumers, taxpayers and more than 13,000 in-state supporters of his group, urges Sandoval to veto SB 539.
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