Republican Nevada Gov. Brian Sandoval vetoed a bill Friday that would require the makers of diabetes drugs to report proprietary information about the cost of drug manufacturing and profits.
The bill, sponsored by Democratic Sen. Yvanna Cancela, sought to keep the price of diabetes medications in check by requiring pharmaceutical companies to report all costs associated with producing and marketing certain diabetes drugs.
The requirement would have extended to all drugs the state deemed essential, a classification that would include insulin and a number of other medications. The vetoed legislation would have also required drug companies to provide public notice 90 days before raising the price of any essential diabetes drugs, according to the Las-Vegas Review Journal.
Sandoval criticized the bill in his veto statement, calling it a “nascent, unproven, and disruptive change to public health policy.” Sandoval argued that the legislation “fails to account for market dynamics that are inextricably linked to health care delivery and access to prescription drugs.”
Sandoval was specifically concerned about the mandated 90 day price increase warning, which he argued could “lead to stockpiling of drugs or other artificial mechanisms for adjusting the supply of medication based on the guarantee of higher profits in the future.”
The bill’s sponsors argued the increased transparency is sorely needed in light of recent steep increases in drug prices.
“The reality is Nevadans with diabetes face insulin price gouging every day, and they shouldn’t have to,” Cancela said in an emailed statement. “Nevada had the potential to lead the nation in taking on high drug costs, and tonight we have lost that opportunity.”
Sandoval discounted Cancela’s argument in his veto statement. He pointed out that while consumers may be able to more easily take drug companies to court for price gouging, the resulting uncertainty in the market place would outweigh the potential benefit of holding the drug companies responsible.
“While the ultimate disposition of any legal claim challenging SB265 would be for the courts to decide, lengthy and expensive litigation and legal uncertainty could destabilize the market for diabetes drugs and jeopardize a new secure supply of these drugs,” Sandoval wrote.
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