Badger InstituteBadger Institute
  • Home
  • Issues
    • Taxes
    • Education
    • Crime & Justice
    • Spending & Accountability
    • Economy & Infrastructure
    • Federalism
    • Licensing
    • Healthcare
    • Civil Society
  • Mandate for Madison
  • Research
  • Magazines
    • Diggings
    • Wisconsin Interest
  • Events
  • Media
    • Podcast
    • Fact Sheets
    • Viewpoints
    • Press Releases
    • Badger in the News
    • Video
    • Audio
    • Testimony
  • About
    • Our Mission
    • Board of Directors
    • Team
    • Visiting Fellows
    • America’s Future
    • Careers
  • Newsletter
  • Donate
  • Contact Us

Subscribe for Updates

Get the latest news and updates from Badger Institute.

What's New

Why should food stamps be forever stamps?

March 30, 2023

Latest crime figures show a Milwaukee in trouble

March 23, 2023

Wisconsin lawmakers in the dark on broadband

March 16, 2023
Facebook Twitter YouTube LinkedIn Instagram
TRENDING:
  • Why should food stamps be forever stamps?
  • Latest crime figures show a Milwaukee in trouble
  • Wisconsin lawmakers in the dark on broadband
  • The underfunded part of Wisconsin public schooling
  • Foreseeing the Future of Wisconsin’s Flat Tax
  • Wisconsin voters will be asked about welfare work requirements
  • A state without convictions
  • Why Wisconsin Needs a Flat Tax and Education Reform
  • Donate
  • Newsletter
  • Contact
Facebook Twitter YouTube LinkedIn Instagram
Badger InstituteBadger Institute
SUPPORT OUR MISSION
  • Issues
    • Taxes
    • Education
    • Crime & Justice
    • Spending & Accountability
    • Economy & Infrastructure
    • Federalism
    • Licensing
    • Healthcare
    • Civil Society
  • Mandate for Madison
  • Research
  • Magazines
    • Diggings
    • Wisconsin Interest
  • Events
  • Media
    • Podcast
    • Fact Sheets
    • Viewpoints
    • Press Releases
    • Badger in the News
    • Video
    • Audio
    • Testimony
  • About
    • Our Mission
    • Board of Directors
    • Team
    • Visiting Fellows
    • America’s Future
    • Careers
Facebook Twitter YouTube LinkedIn
DONATE
Badger InstituteBadger Institute
Home » Media » News » State law inflates prescription drug costs
COVID-19

State law inflates prescription drug costs

By Ike BrannonApril 9, 2020
Share
Facebook Twitter LinkedIn Pinterest

Wisconsin’s minimum markup law is particularly egregious when Wisconsinites are suffering

Given that the recent COVID-19 crisis has significantly reduced many people’s income and is increasing the demand for prescription drugs, now would be a good time to reverse the antiquated laws that keep prices in Wisconsin higher than they need to be.

The so-called Unfair Sales Act precludes retailers from selling items below cost. The ostensible fear is that, without the law, a big retailer could drive prices so low that its smaller rivals would be driven to bankruptcy, achieve some modicum of monopoly power and then raise prices.

In the real world, we rarely see this behavior because it is relatively easy for new competitors to enter a market if they see an incumbent standing alone and earning fat profits.

It’s bad enough that this unnecessary law makes Badger State residents pay more for gasoline (which must be marked up by 9%) than in neighboring states. An even bigger concern, given our health care and economic crisis, is that the Unfair Sales Act increases drug prices.

Here’s an example of how the law penalizes consumers: In 2006 Walmart began selling a vast array of generic prescription drugs used to treat everything from high cholesterol to diabetes to heart issues – for just $4 for a 30-day supply and $10 for a 90-day supply.

The retailer surmised that while some of these prices may have been a little below their cost, charging a uniform low price across such a wide array of drugs would encourage shoppers to get all of their prescriptions at Walmart – and make other purchases at the same time. It was a great deal for consumers, and the other large pharmacies like Costco, Walgreens and Kroger eventually followed suit with similar pricing programs.

However, because some of the generic drugs on Walmart’s list cost Walmart more than $4 – and violated the state’s Unfair Sales Act – Wisconsin prevented Walmart from offering the deal. In the name of protecting Wisconsin’s consumers, Walmart was forced to charge a higher price here than in other states.

The fact that this discounting program has lasted a decade and a half elsewhere belies any notion that Walmart’s low prices will drive its competitors out of business; besides, these days its biggest competition comes from the Internet. If this is predatory pricing designed to drive competitors out of business then Walmart is really, really bad at it.

Wisconsinites with underlying health issues and thin wallets are particularly vulnerable right now. If Wisconsin politicians want to lower prescription drug prices, they should ditch this anti-consumer law posthaste.

Ike Brannon is president of the consulting firm Capital Policy Analytics and a Badger institute visiting fellow. Permission to reprint is granted as long as the author and Badger Institute are properly acknowledged.

News
Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email
Ike Brannon

Related Posts

Why should food stamps be forever stamps?

March 30, 2023

Latest crime figures show a Milwaukee in trouble

March 23, 2023

Wisconsin lawmakers in the dark on broadband

March 16, 2023
Categories
Top Posts

Local pols filling old budget holes with massive COVID aid

December 8, 20221,455

This is not four years ago

November 10, 20221,288

A state without convictions

January 12, 2023647

Billions in federal spending in Wisconsin unaudited; results never measured

November 9, 2022493
Archives

Sign Up for Top Picks

Our weekly e-Newsletter with the latest items and updates

Connect with Badger Institute
  • Facebook
  • Twitter
  • YouTube
  • LinkedIn
About Us
About Us

The Badger Institute is a nonpartisan, not-for-profit institute established in 1987 working to engage and energize Wisconsinites and others in discussions and timely action on key public policy issues critical to the state’s future, growth and prosperity.

Facebook Twitter Instagram YouTube LinkedIn

Sign Up for Top Picks

Our weekly e-Newsletter with the latest items and updates

What’s New

Why should food stamps be forever stamps?

March 30, 2023

Latest crime figures show a Milwaukee in trouble

March 23, 2023

Wisconsin lawmakers in the dark on broadband

March 16, 2023

The underfunded part of Wisconsin public schooling

March 16, 2023
© 2023 Badger Institute | Privacy Policy | Disclaimer | Sitemap

Type above and press Enter to search. Press Esc to cancel.

This site uses functional cookies and external scripts to improve your experience.

Privacy settings

Privacy Settings

This site uses functional cookies and external scripts to improve your experience. Which cookies and scripts are used and how they impact your visit is specified on the left. You may change your settings at any time. Your choices will not impact your visit.

NOTE: These settings will only apply to the browser and device you are currently using.

CRM Software

Customer Relationship Management Software

Google Analytics

Google Analytics is a web analytics service offered by Google that tracks and reports website traffic. Google uses the data collected to track and monitor the use of our Service. This data is shared with other Google services. Google may use the collected data to contextualize and personalize the ads of its own advertising network.

You can opt-out of having made your activity on the Service available to Google Analytics by installing the Google Analytics opt-out browser add-on. The add-on prevents the Google Analytics JavaScript (ga.js, analytics.js, and dc.js) from sharing information with Google Analytics about visits activity.

For more information on the privacy practices of Google, please visit the Google Privacy & Terms web page: https://policies.google.com/privacy?hl=en

Powered by Cookie Information