California Gov. Jerry Brown defied the drug industry Monday bysigning a sweeping drug price transparency bill that will forcedrugmakers to publicly justify big price hikes.
“Californians have a right to know why their medical costs areout of control, especially when pharmaceutical profits aresoaring,” Brown said. “This measure is a step at bringingtransparency, truth, exposure to a very important part of ourlives. That is the cost of prescription drugs.”
The new law will require drug companies to give 60 days’ notice to stateagencies and health insurers anytime they plan to raise the priceof a drug by 16 percent or more over two years on drugs with awholesale cost of $40 or higher. They must also explain why theincreases are necessary.
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