Why is drug price transparency legislation like the wolf in “Little Red Riding Hood”? It was because the wolf was pretending to be something he was not. Equally, there is state legislation that is pretending to be about transparency in drug pricing when it is really about limiting the profitability of biotech firms. That kind of government control would deter investment in new and innovative biopharmaceutical treatments.
Under a bill introduced by state Sen. Ed Hernandez, D-West Covina (Los Angeles County), drug companies would be required to disclose their prices and offer detailed data about their cost. According to its supporters, the purported transparency SB17 requires is supposed to expose that drug company spending on an individual drug cannot justify the price.
This assumption fundamentally misunderstands the drug development and financing process.
Read more at sfchronicle.com.