Pooling drug purchases increases leverage and bargaining power to negotiate lower drug prices. State purchasing pools may include several programs in one state (such as Medicaid, elderly assistance, state employees, workers’ compensation) or one or more programs in several states.. States have also enacted discount drug programs aimed at expanding access to affordable medicines. Discount programs and purchasing pools vary widely in effectiveness; some drug industry-supported plans are little more than marketing tools for brand-name drugs. NLARx is working with state legislators to establish effective purchasing pools and discount plans that (1) give states the tools they need to leverage the best prices through preferred drug lists and the option of placing drugs on a list for prior authorization if manufacturers refuse to provide sufficient discounts; (2) combine a sufficient number of programs and persons in the pool to leverage the best prices; (3) provide benefits to most citizens without other drug coverage with a minimum of red tape and hoops to jump through; and (4) avoid the costs of using a middleman vendor or pharmacy benefit manager to negotiate prices, thus retaining the full value of rebates and control over data.

Researching this Issue

Model laws and best practices, testimony supporting these initiatives, and background information and research materials including reports, court decisions in the Maine Rx case, and news articles are posted here. Other relevant materials may be found on the issue pages relating to Preferred Drug Lists, which includes information on the most appropriate design of a PDL and on the Medicaid & Medicare page. Information on the Pharma Watch page details drug industry tactics and spending on lobbying, fake grassroots groups and ballot initiatives intended to thwart state efforts to establish drug discount programs and purchasing pools similar to Maine Rx Plus. See also the Related Links below to connect to other organizations and materials relevant to this issue.