Why appeals court sided with Maine

The Maine Attorney General's office reported that its phones were ringing off the hook last week as officials in states across America called with congratulations on Maine's legal victory over the pharmaceutical industry and for advice on crafting drug price control legislation. National attention has focused on Maine as a result of a U.S. Court of Appeals ruling that Maine's Fairer Pricing for Prescription Drugs Act, which gives the state authority to impose price controls on drugs, does not violate the U.S. Constitution(see BioCentury Extra, Thursday May 17).

Maine's prescription drug law, enacted a year ago, creates a state-run pharmacy benefits program called Rx Maine, open to all state residents. Under the law, Rx Maine is to negotiate rebates with drug manufacturers using the rebates provided under the state's Medicaid drugs program for the elderly and indigent as a benchmark. Under the law, Maine pharmacies will sell the drugs at a discount based on the rebate...