Drug Pricing Policy Watch

Drug pricing has become a hot-button political issue in American politics over the past several years, featuring prominently in the 2016 presidential campaign, and remaining in national news in the early days of the Trump Administration. The primary focus of this blog will be to track the progress of major pieces of state drug pricing legislation and related bills, and to highlight certain key features of these proposals as they evolve through state legislatures.  In addition, we will address noteworthy federal legislative developments and corporate pronouncements related to prescription drug pricing, such as commitments by major drug manufacturers on price increases and transparency.

Latest from Drug Pricing Policy Watch

On June 16, 2021, Governor Jared Polis signed into law SB 21-175, a law that creates the Colorado Prescription Drug Affordability Review Board (PDAB). The PDAB is required to conduct affordability reviews of certain prescription drugs and determine whether any are unaffordable for Colorado residents. The law authorizes the PDAB to establish Upper Payment Limits (UPLs) for drugs found to be unaffordable, and prohibits all purchases of or payer reimbursements for a drug at…
In just the last few weeks, Tennessee and Connecticut joined the growing list of states to pass legislation banning the use of accumulator adjustment programs. As my colleague Erik explained earlier this month, manufacturers often provide cost sharing assistance programs to help patients afford certain high-cost specialty drugs. Insurers have in turn implemented “accumulator adjustment programs” that seek to reverse the impact of these programs by not counting the amounts provided by the manufacturer in calculating…
Three additional states enacted legislation in recent weeks barring the “accumulator adjustment program” cost sharing framework. Accumulator adjustment programs seek to reverse the impact of manufacturer cost sharing assistance for prescription drugs by not counting amounts offset by such assistance toward a patient’s deductible. This can result in high patient out-of-pocket responsibilities after the manufacturer’s cost sharing assistance has been exhausted. For this reason, both drug manufacturers and patient advocates have sought to bar accumulator…
On March 24, 2021, Virginia Governor Ralph Northam signed HB 2007, adding Virginia to the growing list of states that have enacted drug pricing transparency measures. The new law, which takes effect January 1, 2022, establishes drug price transparency requirements for manufacturers, wholesale distributors, PBMs, and carriers. The legislation establishes an annual (by April 1) reporting requirement for manufacturers with respect to 1) brand-name drugs and non-biosimilar biologicals with a WAC of $100 or…
On January 27, 2021, Governor Baker of Massachusetts issued his FY 2022 Governor’s Budget. The budget legislation includes an anti-drug price increase measure that has previously been proposed by the Baker Administration on multiple occasions. Under the legislation, drug manufacturers “who establish[] an excessive price [meaning WAC] for any such drug directly or in cooperation with a related party, shall pay a per unit penalty on all units of the drug ultimately dispensed or administered…
Following the recent trend in northeast states, Governor Janet Mills recently signed into law An Act To Establish the Maine Prescription Drug Affordability Board, which according to advocates is designed to lower prescription drug costs in the state.  The Board will consist of 5 members, with each member having expertise in either health care economics or clinical medicine.  Two of the members will be appointed by the Senate President, two of the members will…
On July 31, 2019, Governor Charles Baker signed a law designed to increase supplemental rebates for prescription drugs in the Massachusetts Medicaid program (MassHealth).  This law follows on a somewhat similar law enacted in New York in 2017. Under the new Massachusetts law, the state’s Executive Office of Health and Human Services (EOHHS) can propose and negotiate for supplemental rebates for covered outpatient drugs directly with pharmaceutical manufacturers under an exemption to the Massachusetts public…
During the summer of 2019, a number of states enacted new drug price transparency laws, swelling the number of states with such laws to 11.  Colorado, Maine, Maryland, Texas, and Washington joined California, Connecticut, Louisiana, Nevada, and Oregon with transparency laws.  Oregon also supplemented its transparency laws with an advance notice requirement for certain price increases. Washington: On May 9, Washington enacted HB 1224.  Under this law, drug manufacturers would have to provide at…
On July 31, 2019, Governor Charles Baker signed a law designed to increase supplemental rebates for prescription drugs in the Massachusetts Medicaid program (MassHealth).  This law follows on a somewhat similar law enacted in New York in 2017. Under the new Massachusetts law, the state’s Executive Office of Health and Human Services (EOHHS) can propose and negotiate for supplemental rebates for covered outpatient drugs directly with pharmaceutical manufacturers under an exemption to the Massachusetts public…
n May 7, 2019, the Ways and Means Committee of the Massachusetts Senate reported its final budget (S.4), which includes within it authority for the Commonwealth’s Executive Office of Health and Human Services (“HHS”) to directly negotiate supplemental rebates with drug manufacturers for covered drugs on behalf of the Massachusetts Medicaid program, MassHealth.  The operative language appears in outside sections 4 and 39 of the budget and is substantially similar to drug rebate…