COUNCIL MEMBER David A. Catania (I-At Large) has made admirable efforts in searching for ways to reduce drug prices in the District. He has focused on the city's working poor and chronically ill who don't qualify for Medicaid or other discounts but who can't afford increasingly costly drugs. Mr. Catania has met with drug companies many times, consulted with other state and local politicians, and ordered city health programs to use "manufacturer rebates, pharmacy discounts and aggregate purchasing" to obtain what relief they can. His efforts last spring persuaded drug manufacturers to set up a Web site for D.C. residents informing them of available discounts.
Mr. Catania is also right to complain of the vast differences in the price of drugs in this country and abroad: In effect, poor Americans pay high prices so that wealthy Europeans can pay low prices. Nevertheless, his latest legislative solution is not the right one. The Prescription Drug Excessive Pricing Act declares it illegal to sell drugs at excessively high prices in the District. It defines "excessive" as at least 30 percent more than the price of the drug in Australia, Britain, Canada or Germany. The law would be enforced by plaintiffs who file lawsuits against the companies who make drugs. Local pharmacies would not be liable.
Problems with the law, which the pharmaceutical industry has challenged in court, begin with questions about the District's constitutional standing to regulate this aspect of interstate commerce. It is also bad economics: There is no "correct" price for drugs and no evidence that the British or Canadian governments are any better than the United States at calculating the research and distribution costs of making drugs or at estimating their value. If it stands, the law is sure to become a source of expensive and time-consuming litigation, which isn't good for either the District or the drug industry.
The law should be repealed, and the District should go back to the drawing board. But its passage sends a message to the drug industry and the federal government about the political dangers of selling drugs at vastly different prices in similar economies.