TRENTON, N.J. – A Democrat proposal giving a government-created board the ability to control prescription drug prices in New Jersey will not help patients, but will destroy the state’s acclaimed life sciences industry, says Assemblyman Christopher DePhillips.
“New Jersey, which is home to 14 of the world’s 20 largest pharmaceutical companies, cannot afford the Democrats’ plan to put bureaucrats in charge of drug prices,” DePhillips (R-Bergen) said. “Our state ranks dead last in the nation for its business climate and we have the highest-in-the-nation corporate business tax. Moreover, I have yet to see evidence that this proposal would lower out-of-pocket prices for patients, but I can guarantee it will be an industry killer.”
The bill (A1747) establishing a state prescription drug affordability board has been considered and released by committees in the Assembly and Senate. It was also released from committee last session but did not make it to either chamber’s floor for a full vote.
“There is no proof that an affordability board in any other state has actually resulted in lower drug prices. This bill offers false hope to the residents of this state,” DePhillips said prior to his no vote in the Assembly Financial Institutions and Insurance Committee last session.
Six states have drug affordability review boards – Colorado, Maine, Maryland, New Hampshire, Ohio and Oregon.
Government prescription price control in other countries like the United Kingdom and Canada has stifled innovation and access to life-saving medications. Between 2001 and 2010, the United States invented three out of every five new medications and the United Kingdom developed just 8%. Cancer patients in the United States had access to 96% of all new medications launched between 2011 and 2018, while Canadian patients had access to fewer than 60%.
“The last thing New Jersey needs is to enact socialist policies establishing government pricing,” DePhillips added. “If anything, we need to make the state more attractive for businesses by lowering taxes. That is a concept that has been proven to work.”
DePhillips sponsors a bill in the Assembly (A1146) to gradually lower New Jersey’s corporate business tax from 11.5% to 2.5% – matching North Carolina’s lowest-in-the-nation rate. After North Carolina’s corporate income tax was lowered, it had the fastest gross domestic product growth and one of the fastest growing populations in the country from the first quarter of 2013 through the third quarter of 2015.
With more than 300 biotechnology companies and 20 pharmaceutical and medical technology firms, including Novartis, Merck and Johnson & Johnson, New Jersey has earned the global reputation as the “medicine chest of the world.” Over 300,000 New Jerseyans have jobs related to the biopharmaceutical industry.
“The drug pricing problem is complex and we should look at ways to help people afford their medications, but not at the cost of research, development, innovation and jobs,” DePhillips said.