AUGUSTA (AP) – Gov. John Baldacci announced Wednesday the creation of a four-state prescription drug purchasing pool that is expected to save Maine’s Medicaid program about $1 million per year.

“We are delighted that Vermont, Utah and Iowa have agreed to join with us to create this new partnership,” Baldacci said. Discussions are under with other states in hopes of expanding the consortium’s negotiating power with the pharmaceutical industry, he added.

“By joining forces and negotiating together we can acquire the best supplemental pharmaceutical rebates while preserving each state’s ability to customize its own preferred drug list and prior approval programs,” he said.

The new Sovereign States Drug Consortium also seeks to maximize savings by working with a single nonprofit administrator and reducing duplicative state costs.

Vermont officials said they were leaving a nine-state collaborative they helped create nearly two years ago in order to join the new, smaller group.

“You can’t stop innovating,” said Vermont Human Services Secretary Michael Smith. “We have found another mechanism to keep saving.”

One objective of the new initiative is to allow states to include private businesses and other public purchasers in the consortium once it begins operation. Maine has established the Pharmaceutical Cost Management Council with public and private purchasers to prepare for that opportunity.

“The Consortium provides an extraordinary opportunity for states to work together to reduce the growth of Rx spending in Medicaid programs and to build initiatives to help all citizens of our states,” Baldacci said.

The original multistate pool was first conceived by Vermont officials in Howard Dean’s administration. But it was Gov. James Douglas’ team that brought the concept to fruition.

Douglas and Michigan Gov. Jennifer Granholm organized the drug-buying pool for people enrolled in their states’ Medicaid programs. New Hampshire was one of the other states that later joined.

For now, New Hampshire is staying in the pool, said Gregory Moore, a spokesman for the state Department of Health and Human Services. The situation will be reviewed in the future, he said.