Despite industry opposition, Maryland will be able to fine companies for ‘excessive and unjustified’ price increases

A law that allows the US state of Maryland to challenge generic drug price gouging went into effect on 1 October, despite heavy opposition from the generic drug industry. A Judge refused the Association for Accessible Medicine’s (AAM) request for an injunction to prevent the law’s enaction.

Under the new law, the state can fine generic drugmakers if they increase the price of a prescription drug in a way that is ‘excessive and not justified’ by the cost of producing the medication or the cost of appropriately expanding access to the product. The move follows high-profile cases of off-patent or generic drug prices being raised dramatically, such as Mylan’s Epipen adrenaline injectors.

The AAM, formerly the Generic Pharmaceutical Association, has argued that the law would hurt patient access to safe, affordable generic medicines in Maryland and the rest of the US, and that it could create uncertainty for generic drug makers that might cause them to abandon markets entirely. The AAM has also pointed out that the bill only applies to generic drugs, not to more expensive brand-name drugs.

In the wake of concerns about the rising cost of pharmaceuticals, the US Food and Drug Administration wants to get generics to the market more quickly. Earlier this month, the agency announced several actions to improve the efficiency of the generic drug approval process and close loopholes that allow branded drug companies to block generic competition.