House rejects Gov. Healey's proposed prescription drug tax expected to generate $60M in revenue

Photo I Courtesy of Sam Drysdale/SHNS House Speaker Ron Mariano delivers remarks at MassBio's State of Possible conference on Wednesday.

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By Sam Drysdale I State House News Service

The House Democrats redrafting Gov. Maura Healey's budget won't adopt her plan to add new taxes on prescription drugs, House Speaker Ron Mariano said Wednesday.

Mariano told top pharmaceutical and biotech leaders at MassBio's "State of Possible" conference that the House would drop the idea that the governor put forward in her $62 billion annual budget bill in January.

Healey's budget sought new revenue from prescription drug manufacturers for excessive price increases. The administration estimated it could generate $60 million in revenue for the state. General tax collections outside of the income tax on high earners have slowed, returning to pre-pandemic levels of growth, while spending appetites remain high — and budgetwriters are looking for creative ways to find revenue to support spending.

During a budget hearing this month, Rep. Ann-Margaret Ferrante, the number-two Democrat on the House Ways and Means Committee, raised concerns about Healey's prescription drug proposal. She asked how the state could avoid those charges being "transferred onto the consumer by Big Pharma."

Mariano also announced his chamber would revisit some House-backed initiatives that didn't make it into the pharmaceutical bill lawmakers hammered out late last year. They include requiring insurance companies to count any assistance a consumer receives towards their out-of-pocket spend; making permanent the ability of consumers to use drug manufacturer coupons to pay for prescriptions; and ensuring that pharmacy benefit managers pass through at least 80% of the discounts they negotiate directly to consumers.