West Virginia's Rx for drug costs: West Virginia's new prescription drug program is being called "the mouse that roared.".

AuthorKent, Christina

A pathbreaking resolution passed unanimously by both houses of the West Virginia Legislature could lower the cost of prescription drugs for all West Virginians, and be replicated by other states.

Passed during a special two-day session in late November, the resolution creates a new cabinet-level office, the Pharmaceutical Advocate, to negotiate prescription drug prices for public programs, including state employees, Medicaid, Workers Compensation and the Children's Health Insurance Program. As a benchmark, the advocate would use the federal supply schedule, which the federal government rises to negotiate lower prices for its veterans homes, prisons, and other low-income programs.

Establishment of the advocate office was a requirement of a more comprehensive prescription drug law the legislature passed last April. It also set up a state-sponsored prescription drug discount card program for low-income residents. It calls for the state to investigate the feasibility of buying prescription drugs from Canada, including the possibility of becoming a wholesale distributor in the state. And it requires drug companies to report advertising costs.

If the advocate program works, West Virginia could save substantial amounts of money. On average, the federal prices are about 42 percent of retail. The federal prices are also 18 cents per pill lower than the prices the West Virginia Public Employee Insurance Agency pays, and 35 cents per pill lower than what Medicaid pays.

Once the program is up and running, any private entity, including senior service organizations and agencies and even pharmacies, could join and get the lower prices, says House Speaker Bob Kiss, who initiated the legislation. "The long-run intention is for all citizens of the state to benefit from the initiative, not only those who acquire their drugs through the state insurance systems," he says.

The advocate, whose office would be located within the recently formed West Virginia Pharmaceutical Cost Management Council, would develop a common preferred drug list and prior authorization process for all pharmaceutical purchases for state agencies. The advocate also could contract with prescription drug wholesale firms or act as wholesaler to local pharmacies, once drug prices are negotiated with the manufacturers.

The industry says West Virginia is wrong to narrow the role of the advocate office to just pharmaceuticals. "We think it's important to look at health care as a total package,"...

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