Pharma companies claim Cuomo’s proposed prescription opioid surcharge will hurt consumers

March 07--ALBANY -- Big Pharma is sounding the alarm about Gov. Cuomo's plan to impose a new surcharge on prescription opioids.

A study commissioned by the Pharmaceutical Research and Manufacturers of America -- the trade organization representing the drug industry -- warns that Cuomo's plan will drive up health care costs, harm New York consumers and could worsen the addiction crisis.

"The proposed surcharge is a tax, and taxes raise prices," Union College economics professors Lewis Davis and Jia Gao, wrote in the study, which is set to be released as early as Wednesday.

The study concluded that the surcharge, if enacted, will lead to higher insurance premiums and out-of-pocket costs for consumers and increase health care costs for governments.

It also warned that the proposed surcharge would have a "high cost to society" by reducing access to needed medications and could spur some addicts to switch to illegal opioids, including heroin and fentanyl, which would increase fatalities.

"As this analysis shows, the governor's proposed tax creates a slew of unintended and dangerous consequences," said PhRMA Deputy Vice President Priscilla VanderVeer.

Cuomo's tax proposal, released as part of his 2018-19 budget in January, called for a two cents per milligram surcharge to be collected from manufacturers or distributors in New York.

Revenue from the surcharge, which the administration estimates will generate $127 million the first year and $171 million in the second year, would be used to fund addiction treatment services.

A spokesman for Cuomo defended the surcharge and scoffed at the PhRMA study.

"The headline should be 'Big Pharma funds excuse to skirt responsibility for opioid crisis,'" said Cuomo spokesman Rich Azzopardi. "They know what they did, they should be ashamed and they should pay."

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