Published: Fri, January 10, 2020
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California governor proposes more than $1 billion toward homelessness

California governor proposes more than $1 billion toward homelessness

Newsom also announced that his next budget, which he plans to introduce this week, includes a proposal to spend more than a billion dollars to address homelessness and behavioral health.

Newsom wants the nation's most populous state, home to almost 40 million people, to contract with generic drug companies to make prescription medications on its behalf so it could then sell them to the public.

It would also create a single market for drug pricing within the state, meaning that all participating payers - private or public - would receive the same price for the same drug. He said the goal is to lower prices by increasing competition in the generic market. The state could have as much as a $7 billion surplus this year, according to the nonpartisan Legislative Analyst's Office. Lawmakers forfeit their pay if they miss the deadline.

It is not clear at this time how much the proposal would cost, nor what medicines would be covered. "The money is coming out of families' pockets paying all those insane taxes". The governor's office says drug makers would have to bid to sell their drugs in the state at a uniform price. According to the Office of Statewide Health Planning and Development, from January 2017 to June 2019, generic drug prices increased 37.6%, while brand name drugs rose by 25.8%.

An example could be insulin for diabetes patients. Three drug companies control most of the market for insulin.

California has seen steep drug price hikes than any other USA state in recent years and hopes that by competing with established generic makers it can create more competition and thereby drive down prices.


"To the extent that Civica Rx has been able to do this for its hospital systems, the state of California could engage in similar kinds of arrangements, at least at some level", said Rachel Sachs, a law professor at Washington University.

In the US, less expensive generic drugs comprise the majority of prescriptions filled, but spending on costly brand-name drugs with no alternatives has continued to drive prices higher.

"What he is proposing to do would help in specific cases, but it's not a panacea by any means", Joyce said.

The proposal, part of the new state budget Newsom is expected to send to the Legislature on Friday, would authorize the state to negotiate contracts with drugmakers to manufacture selected prescriptions on behalf of California.

Responding to a growing crisis on the streets of California's cities, Governor Gavin Newsom on Wednesday sought to create a $750 million fund to help house the homeless and directed the state to immediately start setting up tents and trailers.

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