Department of Financial Services’ Office of Pharmacy Benefits investigates drug price spikes during pandemic

Many of the price jumps appeared to come after announcements about using the drugs in clinical trials related to treating Covid-19. The manufacturers are required to provide written responses as to when the pricing decisions were made, the personnel involved, the analyses conducted leading to the spikes and internal memos. The office is authorized to examine witnesses and issue subpoenas as part of its investigations.

A spokeswoman for Rising Pharmaceuticals called the state’s request and suggestion of impropriety “unfortunate.”

A Hikma spokesman said its price increase was unrelated to the pandemic and was made in January last year, even before the first announced Covid-19 case in the U.S. 

Cipla USA did not respond for comment by press time.

The California manufacturers also refuted the allegations. A Nubratori spokesman said the company has never made a sale into New York, and it has never been requested to compound its drug to treat Covid-19. The company did an investigation and did not find evidence of Dexonto being used to treat Covid-19, he said.

A McGuff spokeswoman said Ascor’s price increase was less than 20%, was made in March and has remained unchanged since. “McGuff has always prided itself on ethical and legal practices including product pricing, and we are happy to cooperate as soon as possible with the New York Department of Financial Services to rectify these completely false allegations,” said Ron McGuff, president.

A Jaguar spokesman referred to a company statement, which said Mytesi’s price increase was made in December 2019, and cited a need to manage increasing costs and reimbursement barriers.

The office will announce its conclusions as to whether the spikes were justified in an upcoming Drug Accountability Board report.

“Throughout the Covid-19 pandemic, we’ve seen too many instances of pharmaceutical companies taking advantage of those in need and significantly raising the prices on lifesaving prescription drugs,” Cuomo said.

“When drug manufacturers exploit a global pandemic for their own benefit, it cannot go unanswered. DFS will use every power at its disposal to shine a light on the world of drug prices,” said Linda Lacewell, department superintendent.