California May Start Producing Its Own Medicines

Jan. 10, 2020 -- A proposal for California to contract generic drug companies to make medications would make the state the first in the country to produce its own medications.

The measure would "take the power out of the hands of greedy pharmaceutical companies," Democratic Gov. Gavin Newsom said when he announced the plan on Thursday, the Associated Press reported.

Increasing competition in the generic drug market would lower drug prices for the state's nearly 40 million residents, according to Newsom.

The proposal also includes a single market for drug pricing in the state. Companies would have to bid to sell their medicines at a set price.

"Other countries control or negotiate the price of drugs, and if there is one state that could do it, it's California, which is the size of a country," Larry Levitt, executive vice president of health policy for the Kaiser Family Foundation, told the AP. "A drug company could walk away from Rhode Island. It's much harder to walk away from California."

The proposal must be approved by lawmakers before it takes effect.

Priscilla VanderVeer, vice president of the Pharmaceutical Research and Manufacturers of America, told the AP she's waiting for more details on the proposal before she will comment.