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Comparing the Drug Discount Initiatives

Times Staff Writer

Propositions 78 and 79 both would create drug discount programs for low-income Californians, but they differ in scope and enforcement clout. If both pass, the one with the larger number of votes will take effect.

Proposition 78 would create a program open to individuals who do not have insurance coverage for prescriptions and who make no more than $29,000 a year. Families of four that make no more than $58,000 would be eligible, according to the legislative analyst’s office.

That would cover 4 million to 6 million Californians, according to HealthVote.org, an informational website sponsored by the nonpartisan California HealthCare Foundation.

Proposition 79 would extend the program to individuals making as much as $38,000 a year and families of four making as much as $77,000. People whose families spend 5% or more of their income on medical care would be eligible. Eight million to 10 million people would be eligible under this plan.

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Proposition 78, which is backed by pharmaceutical companies, would be voluntary. Drug makers would face no penalty if they declined to sell prescription medications to eligible residents at a reduced price. Proposition 78 would allow the state to drop the plan if it proved unpopular.

Proposition 79, backed by consumer and labor groups, provides a penalty for firms that do not agree to sell prescription drugs at a discount: The state could deny Medi-Cal contracts to firms that do not participate.

Without a contract, the state could -- under certain circumstances -- move a company’s drugs off a preferred formulary and onto a list that requires physicians to obtain approval before prescribing. This could cost the company market share.

Also, Proposition 79 allows anyone to sue a drug company for engaging in profiteering, which is defined as demanding “an unconscionable price” or “prices or terms that lead to any unjust and unreasonable profit.”

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