California Signs Law that Will Require Drug Companies to Justify Certain Price Increases

October 30, 2017 | Strategic Insights for Ambulatory Care


​The governor of California has signed into law a provision requiring drug makers to give notice if a drug's price is raised by more than 16% during a two-year period, according to an October 9, 2017, article by Reuters. The law aims to provide more transparency for drug pricing and will also require manufacturers to provide justification if prices are raised by more than 16% during the two-year period. Health plans and insurers must now file annual reports that outline how drug costs affect their premiums in the state, the article said.

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