Hogan’s Opposition to Drug Price Gouging

How Governor Hogan Prevented High Prescription Drug Prices Relief for Marylanders

By Susan Olsen, Our Maryland Mike Pretl Fellow

If you or someone you love has been struggling to pay for life-saving medications, be sure to thank our “not-so-bad” Governor Hogan.  After our Maryland legislature passed the first in the nation prescription drug high price-gouging law which limited pharmaceutical companies from raising prices unconscionably on generic drugs, Governor Hogan aligned himself with the lobbying agency of the pharmaceutical companies to completely overturn the law.

Now that the election is over, Big Pharma is raising prescription drug prices again.  There was a temporary halt during the second half of 2018. Media reports are giving credit to the Trump administration which did call for a lowering of prices; however, the Maryland prohibition on price-gouging was being watched all over the nation (Vincent DeMarco, President, Maryland Citizens’ Health Initiative), so the law could have had some influence as well.

The Prohibition Against Price Gouging for Essential Off-Patent or Generic Drugs law passed on April 10, 2017 and went into effect October 1, 2017.  The law enabled Maryland’s Attorney General to impose fines of $10,000 on pharmaceutical companies for each violation of the law. In addition, the errant companies had to lower their prices and provide refunds to patients.

Governor Hogan refused to sign the bill; however, since it was veto-proof, he let it go into law without his signature while voicing his opposition to it.  Then he worked behind the scenes with the lobbying organization for the generic drug industry, The Association for Accessible Medicines (AAM), to overturn the law.

According to documents released by the Maryland State Democratic Party, between the law’s passage on April 10, 2017 and Hogan’s issuance of his letter to our state legislature on May 26, 2017, pharmaceutical companies Sanofi, GlaxoSmithKline, Novartis, AstraZeneca, Abbvie, and Fresenius Medical Care donated a collective $750,000 to the Republican Governors Association which supported the Governor’s re-election.”  

In addition, shortly after the law’s enactment, Hogan wrote a letter to Maryland state legislators advancing arguments developed and used by AAM’s lawyers to challenge the law in court.  In the weeks before the letter was sent to House Speaker Michael E. Busch, another $100,000 was donated by the pharmaceutical industry specifically for Hogan’s re-election campaign through the Republican Governors Association (RGA).  Collectively, these drug companies donated at least $1,425,000 to the RGA during the first half of 2017.  Aside from Pfizer and PhRMA, none of those entities had ever contributed to Hogan before.

After laying this groundwork, the AAM, on behalf of these companies, sued the state of Maryland in federal district court in Baltimore.  The law was upheld, so pharmaceutical companies appealed to the US Court of Appeals for the Fourth Circuit. During the hearing, the industry lawyers cited Hogan’s “deep apprehension” (p. 22) regarding the law.  This strategy worked, and Big Pharma won.

Maryland Attorney General Brian Frosh has recently petitioned the Supreme Court to review the case; however, with the ideological conservatives recently put on the Court by Trump and the GOP Senate, it is unlikely that Marylanders will get any relief from the anti-price gouging law that our legislature passed to lower prescription drug prices.

Against their financial and health interests, most voters on the Eastern Shore did not support AG Brian Frosh, who spearheaded the law and has worked tirelessly to protect it.  In addition, a majority just voted out State Senator Jim Mathias, who co-sponsored the bill and tirelessly traveled his district speaking to various groups to inform them about the law.  Mathias’ replacement, Mary Beth Carozza, is unlikely to shield us from the rising cost of medications given her ties to the pharmaceutical industry and Governor Hogan.

Marylanders had prescription drug pricing relief for approximately six months.  The law is now in abeyance; however, we’re not giving up. There is prescription drug affordability legislation coming up during this session in Annapolis.   There is a plan to introduce legislation to create a “Drug Affordability Board.”  According to the Maryland Citizens’ Health Initiative, “The board would include examining the entire drug supply chain, including the role of Pharmaceutical Benefit Managers (PBMs) and establishing payment rates for expensive drugs that create significant affordability problems for Marylanders.”

Your help is needed to get this bill passed into law.  Please contact your state senator and delegates to support a “prescription drug affordability board.”  (There is no bill number yet, but we will keep you informed.  Please do not wait for the bill number to call your representatives.)  

If you would like to remain informed about legislation impacting the price of prescription drugs, please join the Maryland Citizens’ Health Initiative at www.healthcareforall.com.  There is a petition on their website where you can sign the Prescription Drug Affordability Resolution.  

If high prescription drug prices have affected you, please share your story on the website or call (410) 235-9000.  Your story will make a difference!

Learn how to lobby for lower prescription drugs by attending the Advocacy Day for Prescription Drug Affordability on February 14th at Maryland Health Care for All at 2600 Saint Paul St. in Baltimore.  The event is being co-hosted by Maryland Health Care for All and the Maryland Public Health Association.

Of course, you can always find updated information on Facebook at “Maryland Health Care for All” as well as our Facebook page under “Our Maryland.”  


The views expressed here are the author’s and do not necessarily represent the views of Our Maryland or Our Maryland Education Fund.