S.C.R. NO.









requesting the CREATION OF a consumer education campaign informing consumers of the relative merits of generic drugs.


WHEREAS, prescription drugs have become an increasingly important component in modern health care as new medications improve health outcomes and quality of life, replace surgery and other invasive treatments, quicken recovery for patients who receive these treatments, and prevent serious and costly hospitalization; and

WHEREAS, prescription drug prices are rising twice as fast as inflation, with annual percentage increases in prescription expenditures surpassing most other aspects of personal health care expenditures in the past decade; and

WHEREAS, total spending in the United States for prescription drugs was $99.6 billion in 1999 and was projected to increase to $116.9 billion in 2000, which is double the amount spent for prescription drugs in 1995; and

WHEREAS, the annual percentage increases in spending for prescription drugs have been more than double those for hospital care and physician/clinical services since 1995; and

WHEREAS, the overall average retail prescription price was $45.79 in 2000, which is more than double the average price in 1999; and

WHEREAS, the average retail price of a prescription for a brand-name drug was more than three times that of a generic drug in 2000, and the price gap continues to increase; and

WHEREAS, brand-name drugs are much more expensive than generic drugs in the retail market, due to patent monopoly rights, the cost of direct-to-consumer advertising through television, radio, and print media, and free samples provided to physicians; and

WHEREAS, aside from price differential and name recognition, there is often no difference between a patented drug and its generic counterpart. After a drug's patent expires, it becomes a generic drug with the same effectiveness, and its price decreases significantly; and

WHEREAS, at least partly due to the enormously high cost, many patients lack adequate access to prescription drugs, and many health care plans do not include coverage for prescription drugs; and

WHEREAS, despite efforts by policymakers and health plans to expand the use of generic drugs, the share of prescriptions dispensed as generic drugs has remained relatively steady since 1996, at about 42% of total prescription drugs dispensed; and

WHEREAS, by advocating increased use of generic drugs, a greater number of patients will have adequate access to prescription drugs as part of their health care program; now, therefore,

BE IT RESOLVED by the Senate of the Twenty-First Legislature of the State of Hawaii, Regular Session of 2002, the House of Representatives concurring, that the Department of Commerce and Consumer Affairs and health insurance providers in the State of Hawaii are requested to work together to create a consumer education program to make consumers aware of the fact that brand name drugs, after their patents have expired, become generic drugs that are equally effective at a reduced cost; and

BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Director of Commerce and Consumer Affairs and the Chief Executive of each health insurance provider in the State of Hawaii.






Report Title:

Prescription Drugs; Generic Drugs; Consumer Education Program.