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Maryland Looks to Protect Consumers from Pharmaceutical Companies

The United States is one of the only developed countries in which citizens are unable to cover the costs of their health care. For most first world and developed countries, the medical industry is largely subsidized by the government through taxes, and costs are kept low and manageable for the citizens. However, in our country, we are still seeing, even with Obamacare in place, a situation in which many are unable to afford medication, and the prices never stay consistent and are prone to market changes and patent monopolies held by the pharmaceutical industries. As such, around the country, people are suffering as a result of not being able to afford high prices for drugs that are beyond reasonable.

What is Price Gouging?

Price gouging is when a company spikes the prices of its product based on a shift in the market where demand becomes increasingly high and prices increase to capitalize on the situation. For example, during a heat wave, a shop may increase the price of water because it is in higher demand. Price gouging in emergency situations can be a criminal offense, especially when people die as a result of not being able to afford the commodity. Pharmaceutical companies have been largely unchecked for their price gouging, as we saw in the situation of Epipens last year when Mylan, the producer of EpiPen, increased the cost of its product by approximately 400%. In the last eight years, EpiPen prices have spiked by almost 1000%.

Mylan and EpiPens: Price Gouging in 2016

EpiPen is one of the most well-known examples of pharmaceutical companies profiting off and price gouging people whose lives depend on the affordability of the drug. EpiPen provides a quick dose of epinephrine that helps to counter a life-threatening allergic reaction known as anaphylactic shock. The EpiPen is used in emergency situations in which a person comes into contact with an allergen that can lead to death, such as bee stings and peanuts, and the person only has a matter of minutes before his or her throat is constricted to the point of suffocation. Once the EpiPen is administered, the person suffering the attack is given additional time to reach a hospital to treat the severe reaction.

Maryland’s House Bill 631: Prohibition Against Drug Price Gouging

Maryland has put forth legislation this month that would give a cause of action and standing to the Maryland attorney general to sue pharmaceutical companies that spike their prices to an unreasonable level (generally around 50% increase) and would satisfy the elements of price gouging.

The legislation looks to protect consumers from price gouging for off-patent or generic drugs considered essential that feature on the List of Essential Medicines adopted by the World Health Organization or that have been designated as an essential medication by the Secretary due to the medication’s ability to treat life-threatening conditions and/or chronic health conditions that substantially impair the daily functions of the consumer.

Definition of “Price Gouging” and “Unconscionable Increase” in Maryland’s Bill

Price gouging, within the bill, is defined by an unconscionable increase in the price of the essential medication, when the increase is found to be:

  • Excessive,
  • Not justified by the cost of producing and/or manufacturing the drug;
  • Not justified by the cost related to the reasonable expansion of the access to the drug as part of a public health policy; and
  • The consumer is left with no meaningful choice regarding the purchase of the drug because the drug is either essential for the treatment of the consumer’s medical condition and/or the drug has insufficient competition in the market place.

Charles County, MD Personal Injury Lawyers that Fight for You

Doctors and pharmaceutical companies sometimes are hand-in-hand when it comes to price gouging and the incredible high costs of medical care. If you or loved one was injured, seriously harmed, or killed as a result of price gouging by a pharmaceutical company or as a result of a doctor prescribing unnecessarily expensive drugs, it is important to consult with an experienced personal injury attorney. Please call the Law Office of Robert R. Castro at (301) 804-2312 for a confidential consultation.