Donald Trump wasn’t the only big winner on election night.
The drug industry successfully swatted down California’s Proposition 61, a ballot initiative that would have capped how much the state’s public health programs pay for medicines at the same level the Department of Veterans Affairs (which receives deep discounts on treatments) shells out for them. The measure failed 46%-54%.
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Prop 61’s clear-cut defeat is a bit surprising considering that polls taken earlier in the fall had shown widespread support for the initiative, which was introduced in the midst of widespread backlash to soaring drug prices (polls had tightened considerably over the past several weeks). But major biopharma industry players like Pfizer (PFE), AbbVie (ABBV), AstraZeneca, and others poured about $110 million into the campaign to defeat it.
Drug makers argued that passing Proposition 61 might force them to actually hike the prices that the Veterans Affairs department pays for medicines in order to counteract the cap. That argument convinced a number of patient advocacy groups, who came out against the measure.
Despite the victory, drug pricing isn’t likely to fade from the public spotlight anytime soon. Although President-elect Trump has previously argued that prices are too high because the government doesn’t have enough negotiating power and consumers aren’t allowed to buy treatments from overseas, biopharma stocks soared on news of his victory since Democratic candidate Hillary Clinton had singled out drug companies during her campaign.