Maryland Governor Wes Moore (D) is expected to sign a bill that expands the state’s prescription drug affordability board’s upper payment limits to cover drugs purchased by any provider in the state, after the bill passed with a healthy majority in both legislature chambers earlier this year.
Vinny DeMarco, president of Maryland Health Care for All, told Inside Health Policy Moore said he would sign the bill, and DeMarco said Moore’s state agencies endorsed the bill. Another source close to the legislation told IHP they were informed the governor plans to sign the bill.
Andrew York, executive director of the Maryland Prescription Drug Affordability Board, also told IHP there has been no indication that the governor would not sign the bill.
The governor has two more bill signing events scheduled this month, one on May 13 and another on May 20.
“As Governor Moore reviews the hundreds of bills put forward this session, he will continue to work with the State Legislature, local leaders, and all partners involved to ensure that we are signing legislation that will make Maryland safer, more affordable, more competitive, and the state that serves,” Moore’s senior press secretary Carter Elliott said in a statement.
The bill will amend current law under which the upper payment limits (UPLs) reached by the board only apply to drugs purchased by public insurance plans. That approach contrasted with other state boards; in Colorado, for example, the UPL applies to all purchases of and payer reimbursements for the drug.
The bill changes the law to now mimic Colorado, allowing UPLs to apply to all payers. The bill does not apply to purchases and payment reimbursements under federal programs.
The bill also prohibits a UPL from being set on a drug in shortage and requires the prescription drug affordability board (PDAB) to consult with the Maryland Medical Assistance Program prior to setting a UPL, as well as considering the effects on providers of 340B drugs when setting a UPL.
DeMarco said there were efforts to include an exemption for orphan drugs from UPLs in the bill, which ultimately failed. A similar effort was seen in Colorado that also failed, with the governor instead signing a bill that would require the PDAB to consider input from the Colorado rare disease advisory council in determining which drugs are unaffordable for patients in the state and in setting potential payment limits.
“Big PhRMA tried to weaken the bill by exempting so called ‘orphan drugs’ but the legislature rejected it because the PDAB should be able to look at all high-cost drugs to see how it can make them more affordable for Marylanders,” DeMarco said.
The PDAB is currently considering a UPL for several drugs: Eli Lilly’s Trulicity, Novo Nordisk’s Ozempic, Boehringer Ingelheim’s Jardiance, AstraZeneca’s Farxiga, AbbVie’s Skyrizi and Sanofi’s Dupixent. The Maryland board will also use CMS-negotiated prices in considering UPLs for the two drugs on its list that are included in the CMS negotiation program, as its criteria says the board “shall not set an upper payment limit that is lower than the Medicare Maximum Fair Prices.”
No state has set a UPL yet, but Maryland’s and Colorado’s PDABs are furthest along in the process. Colorado’s PDAB is currently considering UPLs for Janssen Biotech’s Stelara, Novartis’ Cosentyx and Amgen’s Enbrel, but potentially could face a new lawsuit from Amgen alleging the action is “unconstitutional.” A Colorado district court recently ruled against Amgen, but the company could file a new case once a UPL is set.
According to Michael Kolber, a health partner at the law and consulting firm Manatt, the ruling appears to allow Amgen to refile the lawsuit after a UPL is established.
Stami Turk, a spokesperson for the Pharmaceutical Research and Manufacturers of America, said in a statement to IHP PDABS have yet to produce cost savings for patients.
“PhRMA remains strongly opposed to Prescription Drug Affordability Boards (PDABs) because they have consistently failed to deliver on their promise to lower out-of-pocket costs for patients. So far, not a single PDAB in any state has demonstrated meaningful savings for those who need medicines most. We are disappointed that the legislature and Governor are choosing to double down on an unproven and ineffective policy--expanding it to the commercial market without first demonstrating cost-savings for state employees or Medicaid beneficiaries.” Turk said.
Various patient groups including the Value of Care Coalition, the National Psoriasis Foundation and AiArthritis testified against the bill, raising concerns over access and saying the UPLS may not translate into patient savings. Some patient advocacy groups tied to pharmaceutical companies have been under fire for parroting the same arguments made by drugmakers.
The Maryland Pharmacists Association also testified against the bill, saying while the bill protects dispensing fees, it does not ensure UPLs will not force pharmacies to dispense medications below their acquisition cost. Pharmacists United for Truth and Transparency (PUTT) also raised concerns on reimbursements below drug acquisition cost, administrative burden, impact on drug innovation and affordability and accessibility in underserved areas.
“While the aim is to make medications more affordable, there is a risk that this program may disproportionately affect marginalized communities. Patients in underserved areas may face challenges in accessing medications if pharmacies cannot afford to stock certain drugs due to price restrictions,” wrote Monique Whitney, executive director of PUTT.
Similar concerns have been raised in Colorado, with pharmacies worried they may not receive adequate reimbursement after the PDAB determines UPL for drugs it deems unaffordable.
Maryland Insurance Commissioner Marie Grant testified in support of the bill, saying UPLs would drive spending down and lead to lower prices for carriers and consumers.
“Under that authority, if an upper payment limit is imposed, it would be a rating factor that the (Maryland Insurance Administration) could and would take into account when making determinations on proposed rates for the markets the Agency regulates. Therefore, were the PDAB to set an upper payment limit for the commercial market, the (Maryland Insurance Administration) would be able to ensure it is incorporated in rate setting for the 34.5% of the market which it regulates (which includes Individual, Small Group, and Large Group fully insured plans),” Grant wrote.
AARP also cheered on the bill.
“AARP Maryland has long fought for this bill because Marylanders are tired of overpaying for their prescription drugs and were happy to learn that the governor supports it. For the thousands of aging Marylanders struggling under the weight of high prescription drug prices, this legislation will provide a lifeline. It will ensure that all Marylanders have equitable access to the medications they need without sacrificing their financial well-being,” Hank Greenberg, AARP Maryland state director, said. -- Luke Zarzecki (lzarzecki@iwpnews.com)