States Eye Opioid Tax to Help Fund Addiction Treatment

(Summer 2018) Legislators throughout the nation are trying to increase budgets for opioid abuse treatment and prevention. Measures in 15 or more states seek to levy fees or taxes on prescription opioids. Both Democrats and Republicans support these bills and, if passed, would bring state coffers millions of dollars to fight the opioid crisis.

A case in point is Delaware’s proposed opioid tax legislation. Drug companies pointed out to the bill’s lead sponsor, State Senator Stephanie Hansen, that they were already giving Delaware $500,000 to help with anti-drug programs. Hansen fired back, saying that if her tax proposal had been in effect the previous year, her state would have an additional $9 million to fight rising overdose deaths.

Minnesota, meanwhile, originally sought to charge drug makers an extra amount per opioid dose. Sponsors of its proposed legislation are now thinking of switching gears by turning to a yearly licensing fee for opioid makers or mandating drug manufacturers and distributors hand over cash based on the percentage of opioids they invoice within the state. This new approach is modeled after legislation passed earlier in 2018 as a portion of New York’s budget, which is the only state to enact an opioid tax to date.

Drug manufacturers and distributors, however, are pushing back against the measures introduced. They say that higher prices would ultimately have a negative impact on patients or taxpayers. A spokesperson for the Healthcare Distribution Alliance, which represents drug distributors, commented that taxing prescription opioids may prevent cancer patients and individuals in hospice care from accessing required medications. Further, those in the drug industry argue that name-brand manufacturers already give rebates to states for Medicaid-funded drugs with the combined rebates reach into the billions of dollars. Pharmaceutical company supporters suggest the states’ savings could be channeled into programs aimed at opioid addiction.

Many of the bills similar to those introduced in Delaware and Minnesota were written within the last year. However, few of the measures have made any significant progress, due in part to the clout wielded by drugmakers urging legislators to reduce the proposed fees or scrap the legislation entirely. The Associated Press and the Center for Public Integrity uncovered that opioid manufacturers and their associates spent $880 million in lobbying and other political actions from 2006 to 2015.

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