States are increasingly enacting price transparency laws designed to provide regulators or the public with more information about how entities in the drug distribution system set prices.1 Presumably, having such information will help regulators determine when and how to intervene when distribution system entities make price increases that result in excess profits.2 Transparency laws may also preempt some unwarranted price increases as distribution system entities realize they will have to report prices and thereby invite scrutiny.3
We analyzed 166 prescription drug pricing laws enacted between 2015 and 2018 to identify those that contained price transparency measures that could improve understanding of the economic forces driving drug price increases. Of those, 35 bills in 22 states included a transparency component.
The below interactive map and table summarizes the 35 drug pricing transparency bills we identified. Click on the state in the map or the options on the right hand side to filter the table.
We categorized these laws as either informative or uninformative:
- Informative laws mandate reporting that helps the public or policymakers find out more information about actual transaction prices between parties.
- Uninformative laws mandate reporting of information that is already available from other sources.
In addition, the filterable table, which you can navigate to by using the buttons at the top of the visualization, allows you to filter the laws by:
- Year the law was enacted
- Who in the distribution system the law targets
- The regulatory approach the bill takes
To identify transparency bills, we searched the National Conference of State Legislatures (NCSL) prescription drug database, which tracks state drug laws from 2015 onward. We also used the National Academy for State Health Policy and the American Health Lawyers Association state legislative surveys to identify legislation not included in the NCSL database. These surveys accounted for about 35 percent of our sample.
- Findlay S. States Pass Record Number Of Laws To Reel In Drug Prices. Kaiser Health News 2019; https://khn.org/news/states-pass-record-number-of-laws-to-reel-in-drug-prices/.
- Sarpatwari A, Avorn J, Kesselheim AS. State Initiatives to Control Medication Costs — Can Transparency Legislation Help? New England Journal of Medicine. 2016;374(24):2301-2304.
- Elgin B, Koons C, Langreth R. Drugmakers Cancel Price Hikes After California Law Takes Effect. Bloomberg 2018; https://www.bloomberg.com/news/articles/2018-07-10/drugmakers-cancel-price-hikes-as-california-law-takes-effect.