California governor deploys trailers, tents, funds in homelessness 'emergency'

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The Associated Press reported that Newsom planned to create the fund via executive order on Wednesday, two days before he introduces his second annual budget proposal to the California state legislature. "The state of California is treating it as a real emergency - because it is one".

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. The goal, according to the governor's office, is to lower prices by increasing competition in the generic market. State lawmakers must approve the plan before it can take effect.

Massachusetts Sen. Elizabeth Warren, a Democratic presidential candidate, has proposed legislation to allow the federal government to manufacture prescription drugs when the market fails or prices become too high.

"If Costco can have a Kirkland brand, why can't California have our own generic brand?" said Democratic Assemblyman Joaquin Arambula, an emergency room doctor from Fresno who chairs the House Budget Subcommittee on Health and Human Services. In May, Newsom will revise his plan once state officials have a better estimate of how much money the state will collect in taxes this year. State lawmakers have until June 15 to vote on the proposal and send it to the governor for his approval. Total drug spending rose 2 percent in 2017, according to a report from Blue Cross Blue Shield, despite the fact that 83 percent of prescriptions filled were generic drugs.

An example could be insulin for diabetes patients.

California Governor Gavin Newsom said he will create a fund, seeded with $750 million from the state budget, to provide rental subsidies and supportive housing services in a state home to a quarter of the country's homeless population. Three drug companies control most of the market for insulin.

In the USA, 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.

"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. Generic drugs make up 90% of all prescriptions but account for a fraction of drug spending because they're so much cheaper than brand-name prescriptions.

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

It's another step in Newsom's effort to overhaul California's prescription drug market. Last year, in one of his first acts in office, Newsom ordered the state to take over the Medicaid program's prescription drug benefits, a program that affects 13 million people.