Today, Citizens Against Government Waste (CAGW) released an analysis of misguided provisions in Gov. Tim Walzs (D-Minn.) budget that would impose new taxes on pharmaceutical drugs in the name of halting the opioid crisis. Below are key sections of the analysis:
It is common knowledge that addiction to opioids and other controlled substances such as fentanyl is a national epidemic that needs to be addressed. But, the plans being offered by Minnesota Governor Tim Walz and the state legislature will drive up pharmaceutical costs, hurt patients, and fail to solve the opioid crisis in Minnesota.
The budget includes increased annual registration taxes and additional controlled substances taxes on pharmacies, researchers, pharmaceutical companies, drug wholesalers, and practitioners, totaling $7.9 million. It would also create an annual manufacturer and wholesaler opioid fee, based on total units sold, that in the aggregate of $11 million and $7 million respectively.
Policy makers need to understand that while opioid overdose deaths have increased, the nature of the epidemic has changed since 2012. The opioid addition problem is wide-ranging and goes beyond legal prescription drugs and patients using them correctly. According to the Center for Disease Control, the opioid prescribing rate has dropped by 28 percent between 2012 and 2017. Limiting the dates of prescriptions, drug monitoring programs, and educating doctors on the use of opioids have helped to reduce their use, while allowing access to them by patients who desperately need the medications.
A 2018 Drug Enforcement Administration report stated most of the illicit fentanyl, the most lethal category of opioids, is being brought into the U.S. from China and Mexico. Fentanyl is also being mixed with other controlled substances and is often being sold as a counterfeit prescription pain reliever.
There have been endless complaints about pharmaceutical costs rising, but taxing manufacturers and wholesalers is an irrational response as these extra fees will either be passed along to patients and taxpayers or drug manufacturers will choose not to sell their products, which means less competition and higher prices.
Citizens Against Government Waste is the nations largest nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, abuse, and mismanagement in government.
Curtis Kalin (202) 467-5318