An overview of Maryland’s Prescription Drug Affordability Board and the new legislative effort to continue its existence
Maryland lawmakers, like their federal counterparts, are focused on addressing the growing cost of prescription drugs. One approach that is being recognized at the state level is the establishment of Prescription Drug Affordability Boards (PDAB).
PDABs are independent bodies empowered to analyze the high cost of drugs, impose upper payment limits, or suggest spending amounts per prescription. The scope and memberships of PDABs’ authority varies from state to state.
Despite a massive lobbying effort and a veto from its governor, Maryland was the first state to establish a PDAB and popularize the idea, with their board having been initially created in 2019. Six states have since followed Maryland and enacted laws establishing PDABs: Colorado, Massachusetts, Maine, New Hampshire, Oregon, and Washington.
Maryland’s PDAB is an independent unit of state government tasked with “protecting Marylanders and the Maryland healthcare system from the high costs of prescription drug products.” Maryland’s PDAB consists of five members who possess expertise in the fields of either healthcare economics or clinical medicine.
The members of the board serve staggered terms, and one of the five members is selected by the governor, president of the Senate, speaker of the House of Delegates, state attorney general, and jointly by the Senate president and the House speaker to serve as chair of the board. Maryland’s PDAB is also supported by a professional staff, including an executive director and a general counsel.
Maryland’s PDAB is required to study the entire pharmaceutical distribution and payment system in Maryland and policy options being used in other states and countries to lower the list price of pharmaceuticals. This includes setting upper payment limits, using reverse auction marketplaces, and implementing a bulk purchasing process. Following its study, the board is required to publish a report on its findings and recommendations.
On December 31st, 2022, Maryland’s PDAB published a report detailing price trends and the number of prescription drug products that were subject to their review
The PDAB reported that prescription drug prices outpaced the inflation rate by a difference of 31.5% to 8.5%, respectively, and that over 800 prescription drugs had steadily increased in price over the last three years. The board noted that the cost review process was still being finalized, and did not list any policy recommendations for the legislature to act upon.
Maryland’s PDAB report is missing statutorily required findings and legislative recommendations, which is likely due to the slow start the board had to overcome.
Major obstacles included an initial veto from the governor; a dispute over the requirement for the board to determine funding sources—for which the legislature had to again override a governor veto—and the slow hiring of staff to key roles because of funding issues. One last notable obstacle again came from the governor because statutory language prevented the board from starting its work until all the stakeholders’ positions were filled, and it took the governor until August 2022 to make his appointment.
“It has been a struggle,” Van T. Mitchell, chair of the Prescription Drug Affordability Board, said during a telephone town hall in 2020. “We have worked to coddle things together and try to get the board moving in the right direction.”
The initial bill specified that some of the board’s duties would sunset in December 2022, which included producing a one-time-study review and report of physician-administered drugs for legislative action. Now with a Democratic trifecta government, there is a renewed legislative and advocacy effort to get this board going again and to get a more detailed report for legislative action.
On Jan. 25th, Del. Bonnie Cullison (D – Montgomery) introduced House Bill 279, which would reestablish the original duties for the PDAB. Specifically, HB 279 would reestablish that the PDAB must draft a plan of action for implementing a process to set upper payment limits for certain prescription drugs and make a final policy recommendation to the general assembly on whether to expand its authority on all prescription drug products in the state by Dec. 1st, 2026.
Ultimately, HB 279 would only extend the board’s “sunseted” provisions and would not make any material changes to the board, its mission, or its original 2019 goals. HB 279 has been approved by the House Committee on Health and Government Operations with 15 yes votes to 6 no votes, and it currently awaits a vote on the House floor.