Statewide Investigation Reveals Widespread Violation Of Price Posting Law

Attorney General Spitzer said today that a two-year investigation found that almost 40 percent of pharmacies across the state fail to comply with a state law aimed at helping consumers comparison shop for the lowest prescription drug prices.

"High prescription drug prices are a problem for all New Yorkers, but especially seniors without drug coverage and the uninsured," Spitzer said. "Pharmacy price posters, as required by state law, are intended to allow consumers to comparison shop. The law also seeks to prevent discriminatory pricing, where pharmacies charge different prices to different consumers."

State law requires pharmacies to conspicuously display a poster presenting a list of the 150 most prescribed drugs, along with common dosage amounts and current selling prices in order to provide consumers with disclosure, just as they would find for non-prescription items. This law allows consumers to compare prices among competitors before presenting a prescription to be filled.

Spitzer's office surveyed over 200 pharmacies across New York State to determine whether the posters were placed where consumers present their prescriptions, and whether the prices of ten commonly prescribed drugs listed on the poster matched the prices actually being charged, allowing for a five dollar or ten percent margin of difference.

The investigation revealed that 78 pharmacies were not in compliance with the law. Of those identified, 76 pharmacies agreed to out-of-court settlements, promising to take specific steps for future compliance and to contribute toward a settlement fund. This fund - totaling $33,300 - will be used to pay for an educational campaign to inform consumers about the importance of "shopping around" for prescription drugs.

In addition, Spitzer's office has notified two pharmacies that it intends to sue over violations of the price posting law. These pharmacies include: Lange Pharmacy in Schenectady and J.H. Crowe Pharmacy in Hamilton.

Michael Burgess, Executive Director of Statewide Senior Action said: "The Attorney General's enforcement action is welcome news for seniors, the uninsured and other New Yorkers who don't have drug coverage. Prices can vary widely from pharmacy to pharmacy and it pays to comparison shop. The pharmacy price poster law makes that possible."

The ten commonly prescribed drugs listed on the poster that the Attorney General checked included: Lipitor (cholesterol reducer), Procardia XL (calcium channel blocker), Relafen (anti-inflamatory), Paxil (anti-depresent), Prilosec (anti-ulcerant), Allegra (allergy medicine), Augmentin (antibiotic), Ortho Tri Cyclen (oral contraceptive), Ventolin Inhaler (asthma medicine) and Vicoden Tablet -- C111 (pain killer).

Spitzer's investigation revealed that:

  • It pays to comparison shop because prices varied widely from store to store: in Westchester County, for example, the cash price for the cholesterol reduction drug Lipitor was $167.84 in one pharmacy and $218.89 in another pharmacy, a difference of over $50.
  • Many price posters were difficult to read. Some posters were placed too far behind the pharmacy counter. Other posters were obstructed by doors or store displays. Posters often had prices that were hand-written and contained ink smears, eraser marks or white-out that made the prices nearly illegible.
  • Because the price poster law has not been updated in thirty years, technological advancements have not been exploited to better inform consumers. For example, the use of automated computer systems would allow consumers ready access to up-to-date price information; however, this would need legislative action.

Spitzer offered the following advice to consumers trying to shop wisely for prescriptions:

  • If you are paying cash, shop around. Prices vary from pharmacy to pharmacy;
  • Try calling first -- although pharmacies are not required to give prices on the phone (only if you present a prescription), most will;
  • Explore discount programs. If you are over 65, find out about EPIC (Elderly Pharmaceutical Insurance Coverage). Regardless of age, ask your pharmacist about discounts the pharmacy or a drug manufacturer may offer.
  • Ask your doctor and pharmacist if there is a generic equivalent for your name brand prescription.

Spitzer noted that the need for awareness in comparison shopping for prescriptions is enormous: one in every four New Yorkers, or approximately 4.7 million people, do not have prescription drug coverage and would benefit from shopping around.

The investigation was handled by the Health Care Bureau working with the Division of Regional Offices. Assistant Attorneys General John Powell and Heather Hussar worked under the supervision of Health Care Bureau Albany Section Chief Troy Oechsner and Health Care Bureau Chief Joe Baker. Various regional office staff worked under the direction of Assistant Deputy Attorney General Christopher Walsh and Deputy Attorney General Marty Mack.

Consumers may contact the Health Care Bureau's toll-free hotline at (800) 771-7755 (option #3 on the automated voice menu). Spitzer has also provided information about the EPIC program and other prescription drug information on the Attorney General's website at www.ag.ny.gov.

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