New York state has made significant strides in recent years to improve our business climate. From voluntary adherence to a two-percent spending cap, to the enactment of the tremendously successful property tax cap, lawmakers and the governor have shown a recognition that we need to make significant changes to the way we as a state conduct business. Unfortunately, that progress was disrupted last year, with the passage of a $15 dollar minimum wage and the most expansive paid family leave mandate in the nation.
Now, the state is considering additional anti-business strategies. Despite a major proposal to promote investments in life sciences, the governor’s 2017-2018 Executive Budget would give the Department of Health unprecedented authority over private pharmaceutical manufacturers and impose significant costs on one of the state’s leading industries.
Under this proposal, DOH would have unilateral say over the price of so-called “high-price drugs” and be granted the authority to force the release of proprietary information of private companies. The department would also be able to impose excise taxes on drugs deemed to be too expensive. This precedent is chilling, and the fiscal impact is frightening.
Our members are among the leading taxpayers in New York state and certainly recognize the need to save Medicaid dollars, but this proposal is not the answer. The pharmaceutical industry is already one of the most highly regulated industries in the state. Medicaid programs already dictate the price for many drugs. The demand for proprietary information and ceiling price setting for drugs could mark the beginning of a very disturbing trend of state-interference with manufacturing in general and in the end will not even provide the comprehensive account of actual costs the budget language purports to seek. More likely, this over-reaching mandate will result in misleading assumptions that fail to take into account the many factors involved in manufacturing.
For these reasons, and many more, we urge the Senate and Assembly to reject this proposal during the ongoing state budget negotiations.
Heather C. Briccetti, Esq.
President and CEO of The Business Council of New York State, Inc.