The battle to convince California voters to approve a ballot initiative aimed at curbing prescription drug prices appears to be tightening as the pharmaceutical industry steps up its attacks, according to poll results released on Friday. The California Drug Price Relief Act, also known as Proposition 61, would require drugmakers to give state-run health programs discounts on medications similar to those provided to the US Department of Veterans Affairs, which pays the lowest prices in the country.
A survey of nearly 1,500 registered voters conducted by the Field Poll and the University of California, Berkeley at the end of October found an even split, with 47 percent of voters saying they would vote yes and 47 percent saying they would vote no on the measure. The remaining 6 percent were undecided.
A similar poll conducted in September showed 50 percent of voters in favor, 16 percent opposed and 34 percent undecided. Another early September poll conducted by the University of Southern California and the Los Angeles Times found that 66 percent of voters approved the measure and 23 percent were opposed.
“Investors have been bracing for a controversial and potentially dangerous headline risk,” RBC Capital Markets analyst Michael Yee told Reuters. “This is not necessarily a simple price measure. It may not actually work and could lead to overall higher costs in the system.”
Opponents of Proposition 61, led by pharmaceutical companies like Pfizer Inc and Amgen Inc, have raised nearly $110 million to stop its passage ahead of Tuesday’s vote.
The “No on Prop 61” coalition has stepped up its television and print advertising campaigns in recent days. Many of the ads feature veterans expressing worry that passage of the ballot measure will increase their drug costs if drugmakers respond by limiting discounts to the VA.
Supporters of the proposition, including the Aids Healthcare Foundation and AARP, which advocates for seniors, have said the plan could save California taxpayers up to $5.7 billion over 10 years, although a state legislative analysis said the financial impact is not clear.
Former Democratic presidential candidate Bernie Sanders, who has called on Californians to approve Proposition 61, plans to be in the state to stump for the measure starting on Sunday.
Yee said investors are likely to remain nervous heading into next week given the inherent risks in the wider election, which includes the U.S. presidential race, as well as Senate and House contests. They have also expressed concern over Proposition 61’s potential to curb drugmaker profits, particularly if it becomes a template for action in other states.
At the same time, RBC expects something of a “relief rally” for industry share prices next Wednesday, given the recent sell-off in healthcare stocks. The Nasdaq Biotechnology index has fallen about 14 percent since mid-September. The NYSE ARCA Pharmaceutical index has dropped about 11 percent over the same period.
Presidential candidates Hillary Clinton and Donald Trump have both advocated measures to reduce healthcare costs. Clinton has been particularly critical of sharp increases in U.S. drug prices, promising tougher oversight, and any big gains for fellow Democratic candidates in Congress could strengthen her hand in that cause.