Federalism, Patents, and the Constitutionality of State Pharmaceutical Regulation

14 Pages Posted: 15 Nov 2018 Last revised: 8 Dec 2018

See all articles by Robin Feldman

Robin Feldman

UC Hastings Law

Betty Chang Rowe

UC Hastings Law

Rabiah Oral

University of California - Institute for Innovation Law

Amy Gu

UCSF/UC Hastings Consortium on Law, Science & Health Policy

Katherine Gudiksen

UCSF/UC Hastings Consortium on Law, Science & Health Policy

Date Written: October 19, 2018

Abstract

In recent years, pharmaceutical prices have risen at an alarming rate, putting increasing pressure on state budgets. In response, numerous states have begun to explore methods of addressing the problem, with some considering legislation to regulate drug prices directly. In fact, one recent study indicates that in 2017, more than 80 pharmaceutical pricing bills were proposed in over 30 states nationwide.

This essay addresses issues of federalism, preemption and the Takings Clause as they relate to the intersection of patent law and state drug rate setting legislation. This work proceeds in three parts. Part I provides general background on the preemption doctrine as it applies to state regulation of areas that involve patents. Part II describes the three levels of preemption and applies those levels to state regulation of drug payment rates. Part III examines whether state regulation of drug payments would rise to the level of a regulatory taking under the takings clause of the Fifth Amendment of the United States Constitution. Part IV provides existing examples of state regulation of health care rates. In addition, this section considers the issue of the state in its role as a commercial payer in the marketplace.

Keywords: pharmaceutical, drug pricing, constitutionality, federalism, preemption, Takings Clause, patent law, Fifth Amendment

Suggested Citation

Feldman, Robin and Chang Rowe, Betty and Oral, Rabiah and Gu, Amy and Gudiksen, Katherine, Federalism, Patents, and the Constitutionality of State Pharmaceutical Regulation (October 19, 2018). UC Hastings Research Paper No. 311, Available at SSRN: https://ssrn.com/abstract=3270062 or http://dx.doi.org/10.2139/ssrn.3270062

Robin Feldman (Contact Author)

UC Hastings Law ( email )

200 McAllister Street
San Francisco, CA 94102
United States

Betty Chang Rowe

UC Hastings Law

200 McAllister Street
San Francisco, CA 94102
United States

Rabiah Oral

University of California - Institute for Innovation Law

San Francisco, CA
United States

Amy Gu

UCSF/UC Hastings Consortium on Law, Science & Health Policy ( email )

CA
United States

Katherine Gudiksen

UCSF/UC Hastings Consortium on Law, Science & Health Policy ( email )

CA
United States

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