California would become the first state to sell its own brand of generic prescription drugs in an effort to drive down rising healthcare costs under a proposal Gov. Gavin Newsom is expected to unveil in his new state budget Friday.
A broad overview of the ambitious but still conceptual plan provided by Newsom’s office says the state could contract with one or more generic drugmakers to manufacture certain prescriptions under the state’s own label. Those drugs would be available to all Californians for purchase, presumably at a lower cost. The governor’s office said the proposal would increase competition in the generic drug market, which in turn would lower prices for everyone.
Whether drugmakers would follow California’s lead as Newsom’s administration has suggested is far from certain. And other key details, including what prescriptions would be manufactured, were not provided.
“A trip to the doctor’s office, pharmacy or hospital shouldn’t cost a month’s pay,” Newsom said in a statement. “The cost of healthcare is just too damn high, and California is fighting back.”
Last year, Newsom signed executive orders to consolidate the state’s prescription drug purchases into a government-run program, a plan that is still in its early phases. Under the current system, Medi-Cal and state agencies separately negotiate prescription drug prices, but Newsom wants to consolidate to give the state more purchasing power.
The executive order last year called for the state-run collective to be open to small businesses, California residents and local governments, with a handful of counties already pledging to join, including Los Angeles.
