The Health and Government Operations Committee heard an update from Andy York, executive director of the Maryland Prescription Drug Affordability Board, on the board’s cost-review and policy-review work, including its authority to set upper payment limits for state and local government purchasing and programs. York said the board has selected six drugs for in-depth cost reviews and is analyzing data gathered through requests for information; he said some initial reviews could be completed as early as this spring, though no upper payment limits have been set.

The board’s statutory mission, York said, is “to protect state residents, state and local governments, commercial health plans, health care providers, pharmacies licensed in the state, and other stakeholders within the health care system from the high cost of prescription drug products.” He described three core activities: a structured cost-review study process, a policy-review process that can recommend actions including upper payment limits, and provision of resources for legislators and patients.

The board and its work matter because it is charged with assessing whether particular drugs create affordability challenges and recommending or implementing policies that affect public payers and programs. York said the board is “the 1st in the nation” in this model and noted the work is intended to address both patient out-of-pocket burdens and broader payer costs that can differ significantly because of confidential rebates and other off-invoice adjustments.

York summarized the cost-review process as a multi-step procedure: identify eligible drugs from a substantial list (he said about 2,000 national drug code entries are on the eligibility list), solicit nominations and stakeholder input, issue requests for information to collect confidential and public data, prepare analytical summaries or a “dossier,” and have the five-member board make a preliminary determination about whether a drug causes an affordability challenge. The board has selected six drugs for review: Farxiga, Jardiance, Ozempic, Trulicity, Dupixent and SKYRIZI; York said the first four are diabetes drugs (SGLT2 and GLP-1 classes) and the latter two treat a range of autoimmune conditions.

If the board’s preliminary finding is that a drug causes an affordability challenge, the board enters a policy-review process that considers a portfolio of tools. York said the board “wants to look at all policies that are available to the state” and that while upper payment limits are one specific tool, staff may also recommend non-upper-payment-limit options such as plan-design changes or patient protections that would require legislation or action by other executive-branch agencies.

York explained the board’s authority and timeline for upper payment limits (UPLs): the board’s statutory authority to set UPLs applies to purchases and payments made by state and local government entities, state correctional facilities, state hospitals and clinics, state employee health plans, and Medicaid (the Maryland Medical Assistance Program). He said the board approved an Upper Payment Limit Action Plan in September 2024, the plan was presented to and approved by the Legislative Policy Committee on Oct. 22, 2024, the board approved related proposed regulations on Nov. 25, 2024, and those proposed regulations were published in the January 10 register and are currently in a 30-day public comment period. York said final regulations could be adopted as early as March (if the process proceeds without changes) and that, at the fastest, an UPL could be implemented mid- to late 2025; he emphasized this is the fastest-case timeline and that the process is deliberative and includes multiple public comment opportunities.

Committee members pressed for details about public input and enforcement. York described repeated chances for public comment at multiple stages: publication of the eligible-drugs list, stakeholder-council review, the RFI (he said the RFI comment period is about 60 days), comment opportunities tied to board meetings, and comment steps during any proposed-regulation process. He estimated those opportunities could add up to “probably about a dozen times” across the whole process. On enforcement, York said the statute does not include explicit penalties; enforcement tools would operate through the Office of the Attorney General and the final regulations.

York also addressed scope and likely market effects. He cautioned that UPLs, as defined in statute, apply directly only to public-sector payers and will not automatically produce savings for all patients, but he noted the board’s broader cost-review work and non-UPL policy recommendations are intended to inform options that could affect all Marylanders. He said the board expects its analyses to rely on net-cost data (including confidential information the board seeks) to understand drivers of unaffordability and to identify policy options that address those drivers directly.

Committee members asked whether other states have executed similar UPLs; York said Colorado and other states have similar affordability-review processes but that, like Maryland, many are still in rulemaking or implementation phases. He told the committee the board is prepared to develop policy recommendations for the General Assembly in a future annual report but that comprehensive legislative recommendations require resource-intensive analysis and stakeholder work.

York closed by reiterating that the board aims to be a resource for legislators and patients: “If you have constituents that are coming to you saying that they can't afford their drugs, we are a resource for them,” he said, describing a patient navigator program that helps residents find existing assistance while longer-term policy work continues.

Next steps: the board is analyzing RFI responses for the first set of drugs and will bring findings to the board for preliminary determinations; the public comment period on the proposed UPL regulations is open and the board expects to complete some cost reviews and continue the policy-review process during 2025. No upper payment limit has been adopted to date.

Ending: Committee members expressed support for the board’s deliberative approach and invited the board to provide targeted policy recommendations the committee could consider for future sessions.