Delaware Passes Opioid Prescription Tax

By Kelly Burch 04/15/19

New York passed a similar measure earlier this month.

A piggie bank for the opioid tax in Delaware

Lawmakers in Delaware have passed a measure to tax prescription opioids, a move that they expect will generate $8 million over three years to support addiction treatment in the state. 

Democratic Sen. Stephanie Hansen, who sponsored the bill, said that it will pass on costs to the manufacturers who contributed to the opioid epidemic, according to the Associated Press.  

“These multi-million dollar companies that have reaped record profits after flooding our doctors’ offices and getting people in pain hooked on these drugs will no longer be able to avoid responsibility for the pain and suffering caused by their products,” she said. 

However, people who oppose the measure say that manufacturers will pass the costs on to insurance companies, which will then pass them to consumers. Others said that the tax is a misguided and unfair way to address opioid addiction. 

“Unfortunately, what’s being proposed—taxing legitimately prescribed medicines that patients rely on for legitimate medical needs to raise revenues for the state—ignores evidence-based solutions, sets a dangerous precedent and ultimately won’t help patients and families,” said Nick McGee, a spokesperson for Pharmaceutical Research and Manufacturers of America, an industry group that opposes the measure. 

The tax rates depend on the dosage, and whether an opioid is a brand name or generic. It ranges from a few cents per pill, to up to a dollar per pill. The bill sets the tax rate of one cent for every morphine milligram equivalent, or MME, a measure of an opioid’s strength. In addition, there is a surcharge for brand-name pills. 

For example, a 10-milligram pill of oxycodone would be taxed at 4 cents, while OxyContin, the brand-name alternative, would have a 15-cent tax. 

Johns Hopkins University health economist Jeromie Ballreich said that these amounts would not change what people can expect to pay for their pain medication. 

He said, “I do not expect copays to change based on this fee, just as they don’t change for drug price increases.”

Delaware isn’t the only state that hopes to fund treatment through taxing opioids. New York passed a similar measure last week, its second attempt since 2018. Last year the measure was struck down by a federal judge because of the way that it would affect interstate commerce. 

While New York lawmakers also insisted that patients would not be affected, an academic report on the measure found a different result. 

“While the language of the proposed law attempts to place the burden of the tax on drug manufacturers, in practice market forces determine how the burden of the tax is shared between producers and consumers,” Lewis Davis, professor of economics at Union College, wrote in the report.

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Kelly Burch writes about addiction and mental health issues, particularly as they affect families. Follow her on TwitterFacebook, and LinkedIn.