Newly-Enacted Laws – The National Academy for State Health Policy

State Drug Pricing Laws: 2017-2022

The Inflation Reduction Act’s Health Care Provisions: Opportunities for States

August 22, 2022/in Prescription Drug Pricing Blogs, Featured News Home Newly-Enacted Laws, State Insurance Marketplaces /by Jennifer Reck and Christina Cousart

Washington Joins Leading States in Establishing a Prescription Drug Affordability Board

April 7, 2022/in Policy, Prescription Drug Pricing Washington Featured News Home Newly-Enacted Laws, Prescription Drug Pricing /by Jennifer Reck

On March 24, 2022, Washington state joined five other leading states in establishing a Prescription Drug Affordability Board (PDAB) when Governor Inslee signed SB 5532, sponsored by Senator Karen Keiser, into law. Washington’s PDAB, like those already established in Maryland and Colorado, has the authority to limit what payers in the state will pay for certain high-cost drugs following an affordability review.

Because Washington state enacted a prescription drug price transparency law in 2019 (HB 1224) and has an all-payer claims database, the state is well positioned to identify the costly drugs that the PDAB may consider for an affordability review, the first step toward establishing an upper payment limit for state payers. The Board’s work will focus on the costliest drugs: brand name drugs costing more than $60,000 a year or with price increases of 15% or more over the past year, or 50% in the past three years. Biosimilars and generics are also included under specific circumstances. The Board must identify drugs for an affordability review by June 2023 but may not establish an upper payment limit before January 1, 2027. At that time, the Board may set upper payment limits for up to 12 drugs a year.

This session, Washington state also extended a law capping out-of-pocket insulin costs through 2024. The new law also lowered the insulin cap from $100 to $35 a month. In the meantime, the state’s Total Cost of Insulin Work Group plans to convene to identify and pursue strategies to lower the cost of insulin in the state.

More than a dozen states have enacted legislation to cap out-of-pocket costs for insulin and on March 30, 2022, the House passed a federal out-of-pocket cap for insulin at $35 a month (HR 6833). While out-of-pocket caps bring necessary and immediate relief to consumers, additional measures like a state PDAB or federal drug price negotiations, are also necessary to lower the total cost of the drugs for payers.

The National Academy for State Health Policy (NASHP) is tracking more than 250 state bills aimed at lowering drug prices during the short 2022 legislative session. While most of those bills continue to be efforts aimed at regulating pharmacy benefit managers, the middlemen who negotiate rebates with drug manufacturers and pay pharmacy claims on behalf of health plans, there is growing momentum around PDABs. Nine states have 13 PDAB bills this session. Several other states, – including Rhode Island, Maine, Hawaii, and North Carolina – have introduced bills to achieve savings by referencing Canadian drug prices to establish payment rates for state payers. Those bills reflect model legislation released by NASHP in 2020, An Act to Reduce Prescription Drug Costs Using International Pricing.

Comparison of State Prescription Drug Affordability Review Initiatives

March 31, 2022/in Prescription Drug Pricing Maine, Maryland, Massachusetts, New Hampshire, New York, Ohio Charts, Featured News Home Administrative Actions, Legal Resources, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by NASHP Staff

NASHP’s Annual Conference Highlights States Taking Bold Action on Drug Prices

October 20, 2021/in Prescription Drug Pricing Featured News Home Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Sarah Lanford and Jennifer Reck

While Congress continues to consider significant reforms for drug pricing, states have taken bold steps to control drug prices across payers. This legislative session, Colorado followed Maryland’s lead and established a prescription drug affordability board (PDAB) to address high drug prices. PDAB legislation, such as Maryland’s and Colorado’s, that includes authority for a board to set upper payment limits (UPLs) within a state for high cost drugs, represents some of the strongest state efforts to date to rein in drug costs. The National Academy for State Health Policy’s (NASHP) 2021 annual conference featured a session highlighting Colorado and Maryland’s PDAB laws, as well as New York’s experience with enhanced negotiating authority with manufacturers for high cost drugs within its Medicaid program. New York’s success in achieving notable savings offers insights on implementation that can help guide states standing up PDABs.

Maryland’s Prescription Drug Affordability Board

Enacted in 2019, Maryland’s PDAB law was created to study the prescription drug market in Maryland and to protect consumers and the state from the high costs of prescription drugs. The Board has spent the past year analyzing Maryland’s pharmaceutical distribution and payment system and will report findings, along with policy options to lower costs, to the General Assembly by the end of this year. In September, Maryland issued its first round of invoices for the assessment on drug manufacturers and other entities along the supply chain to support the work of the state’s PDAB. Under the legislation, the PDAB can consider setting upper payment limits, implementing a reverse auction marketplace, and establishing a bulk purchasing process. If the Board determines it is in the interest of the state to establish a process for setting UPLs, the Board must create a plan of action for implementing the process that includes the criteria the Board shall use to set UPLs and submit the plan to the Legislative Policy Committee for its approval. If the plan is approved, the Board may begin setting UPLs for state purchasers in 2022, and for all purchasers starting in 2023.

Colorado’s Prescription Drug Affordability Board

In June 2021, lawmakers in Colorado enacted a law to create a PDAB with aggressive timelines that will enable the Board to begin setting upper payment limits for all payers as early as next year. The law has a transparency component that requires insurance carriers and pharmacy benefit managers to report certain cost and utilization information to the Division of Insurance. The Board will use that data to perform affordability reviews of drugs that exceed the wholesale acquisition cost triggers outlined in the law.

Beginning April 1, 2022, the Colorado PDAB may establish UPLs for up to 12 drugs each year. Colorado’s PDAB, unlike Maryland’s, does not require additional legislative authority to set UPLs, and UPLs will apply to all purchases of and payer reimbursements for a drug dispensed or administered in the state. Similar to Maryland, the Colorado PDAB will make policy recommendations to the General Assembly on strategies to improve the affordability of prescription drugs for consumers.

New York Medicaid’s Drug Cost Cap and Enhanced Negotiating Authority in Massachusetts

In 2017, New York enacted a law that gave the Medicaid program the authority to negotiate with drug companies for supplemental rebates if drug spending is projected to exceed an annual spending limit, which is based on a 10-year rolling average of the Consumer Price Index. If the state is unable to reach an agreement with a manufacturer, a drug may be referred to the Drug Utilization Review Board (DURB), which then conducts a value assessment of the product. When conducting a value assessment, the DURB can consider a drug’s affordability and net cost to Medicaid, value-based pricing, significant price increases, and/or the proportionality of price to therapeutic benefit.

Five years later, New York has had success with this approach. Since the law went into effect in 2018, the state has negotiated over 50 new supplemental rebate contracts with manufacturers, which have generated over $500 million in new supplemental rebates. The DURB has also completed three value assessments for the drugs Orkambi, Remicade, and Spinraza. The DURB used value-based pricing benchmarks from the Institute for Clinical and Economic Review (ICER) to guide the Department of Health on target supplemental rebate amounts for Orkambi and Spinraza and a domestic reference pricing approach for Remicade because two comparable biosimilars were on the market. As a result, New York’s drug cap is achieving additional rebates and reducing the growth of spending without limiting access to high-cost drugs.

Massachusetts has a program similar to New York’s which enables enhanced negotiating authority within its Medicaid program. If an agreement cannot be reached and the drug exceeds certain price thresholds, the drug can be referred to the Massachusetts Health Policy Commission (HPC) for review. To date, this approach has been successful in securing additional rebates without the need for HPC review.

For more information about state actions to lower drug costs, explore NASHP’s Comparison of State Prescription Drug Affordability Review Initiatives and legislative tracker.

Nine States Advance Prescription Drug Affordability Board Legislation

March 15, 2021/in Prescription Drug Pricing Arizona, Colorado, Minnesota, New Jersey, New Mexico, Oregon, Rhode Island, Virginia, Wisconsin Blogs, Featured News Home Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Jennifer Reck and Trish Riley

More than 200 bills to lower drug prices have been filed across states during this session and nine states are proposing prescription drug affordability board (PDAB) legislation.

PDABs are somewhat analogous to public utility commissions. They investigate high-priced drugs and, when necessary, set more affordable rates for certain drugs for purchasers within a state. Establishing health care provider and hospital payment rates is a common approach states use to ensure services are affordable. State PDABs extend this strategy to a subset of very costly prescription drugs, while avoiding unlawful patent preemption because they establish drug payment rates – not prices. The National Academy for State Health Policy (NASHP) developed model legislation for this approach in 2017 and in 2019 Maryland became the first state in the nation to enact PDAB legislation.

This chart highlights nine states’ bills to create prescription drug affordability boards, including their implementation timelines, funding sources, enforcement, and purchasers impacted.

Nine states (AZ, CO, MN, NJ, NM, OR, RI, VA, and WI) are currently advancing PDAB bills in their legislatures. While a number of these bills are similar to Maryland’s approach that phases in upper payment limits by initially limiting them to public purchasers before potentially expanding them to include private purchasers, the majority of the currently proposed bills map more closely to NASHP’s original model legislation, which implements payment limits across all payers (public and private) in a state in a more expedited fashion.

The bills are generally similar in two approaches:

They use similar price thresholds to identify a drug for investigation by their PDABs, and
They apply the same factors when setting an upper payment limit for drugs found to be otherwise unaffordable – such as weighing the cost of administering the drug and delivering the drug to consumers.

Minnesota’s bill, however, includes unique language that empowers its PDAB to consider both the “the range of prices at which [a] drug is sold in the United States and the range at which pharmacies are reimbursed [for it] in Canada.” This language creates a bridge between the PDAB model and a newer approach in a recently released NASHP model law that creates payment rates for certain high-priced drugs based on Canadian pricing. This approach, reflected in NASHP’s Act to Reduce Prescription Drug Costs Using International Pricing, offers states a more streamlined approach than establishing a PDAB, which requires the complex task of determining the appropriate value of a drug in order to set an affordable payment rate. Five states (HI, ME, OK, ND, and RI) are currently considering international reference rate bills that use (or “reference”) Canadian prices to set more affordable rates.

As states consider PDABs and international reference rate approaches to achieve the goal of setting more affordable payment rates for drugs, there are several key factors to consider.

While international reference rates look to Canada’s drug prices when establishing appropriate payment rates, PDABs keep the task of identifying affordable rates within a state.
While PDABs may be conceptually preferable for this reason, the time and resources required to implement this approach may not make PDABs feasible for all states. For those states, using Canadian prices to set rates may be the most viable option.

Minnesota’s bill, however, points to a third option, a hybrid approach in which a PDAB would consider Canadian pricing as part of its process.

Explore this chart to compare the different state approaches and implementation timelines of the nine PDAB bills proposed as of March 9, 2021.

Will Laws to Lower Drug Prices Harm Innovation? The Evidence Says No.

March 8, 2021/in Prescription Drug Pricing Blogs, Featured News Home Administrative Actions, Consumer Affordability, Health System Costs, Legal Resources, Making the Case for Action, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Sarah Lanford

Drug makers claim high prices are necessary to support new drug development and innovation, but research shows that public investment in drug research and development combined with large industry profits leaves manufacturers room to lower prices while continuing to innovate.

Drug manufacturers have brought new vaccines to market in record speed to stop the spread of COVID-19. That notable achievement was made possible by massive financial investments from the public. More than $19 billion in government funding has been invested in the research, development, manufacturing, and distribution of COVID-19 vaccines. In total, the United States has guaranteed purchase of 900 million doses for a population of approximately 330 million and assumed financial risk so manufacturers don’t have to.

Even companies that did not accept federal funding for research and development have benefited from previous taxpayer-funded research. The Pfizer vaccine contains a publicly-funded, government-developed spike protein technology that rapidly accelerated its development process.

Taxpayer-funded research for each of the 356 drugs approved by the FDA in the last decade totals $230 billion. Despite taxpayers’ investments in drug development, manufacturers face few restrictions on what they can charge for these drugs in the United States.

Public funding is not unique to vaccines though. The drug industry relies heavily on public funding for all forms of drug development. Taxpayer-funded research for each of the 356 drugs approved by the US Food and Drug Administration in the last decade totals $230 billion. Despite this level of public investment in drug development, manufacturers face few restrictions on what they can charge for their drugs in the United States despite taxpayers’ investments.

As a result, drug prices are on average 2.5-times higher in the United States than comparable countries, even though those countries also contribute considerably to research and development (R&D) costs. High drug prices in the US market have generated substantial profits for the pharmaceutical industry. Between 2008 and 2018, the profitability of pharmaceutical companies was almost double that of other large, public companies.

Despite the significant amount of taxpayer funding, pharmaceutical industry officials argue that high drug prices reflect the cost of R&D and the risk associated with developing a new drug. However, high US drug prices exceed what is necessary to fund R&D. For example, drug manufacturers Amgen, Biogen, Pfizer, and Teva generated more than double their global R&D budgets from excessive US prices, and three companies covered or nearly covered all of their research spending through high US prices on their top-selling products alone:

AbbVie’s Humira (an immunosuppressant);
Biogen’s Tecfidera (treats multiple sclerosis); and
Teva’s Copaxone (an immunomodulator that treats multiple sclerosis).

Two of these drugs – Humira and Tecfidera – appear on the Institute for Clinical and Economic Review’s 2020 list of drugs that have prices increases unsupported by new clinical evidence.

With little action on drug prices from the federal government, states are considering new ways to control drug spending, and lawmakers have filed more than 200 bills this session, including bills with the potential for real impact on prices. Five states have introduced the National Academy for State Health Policy’s (NASHP) model legislation to establish international reference rates to bring prices in line with Canadian rates, which could result in savings ranging from 60 to 85 percent. Three states have introduced NASHP’s model legislation that fines pharmaceutical manufacturers whose drug price increases are unsupported by new clinical evidence – including Humira and Tecfidera cited above – based on the Institute for Clinical and Economic Review’s research.

As states ramp up their efforts to address excessive drug prices, the industry continues to argue that lower prices would harm innovation. Trail-blazing states can be reassured, however, that there is room for manufacturers to lower prices while still maintaining their profit margins and preserving their capacity for innovation.

States Take Diverse Approaches to Drug Affordability Boards

February 12, 2021/in Policy Maine, Maryland, Massachusetts, New Hampshire, New York, Ohio Blogs, Featured News Home Administrative Actions, Legal Resources, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Johanna Butler, Jennifer Reck and Trish Riley

As states take important steps to lower prescription drug costs, at least six have implemented prescription drug affordability review initiatives, although approaches vary across states. The National Academy for State Health Policy (NASHP)’s new chart, Comparison of State Prescription Drug Affordability Review Initiatives, provides a road map of the diverse efforts taken by Maryland, Maine, New Hampshire, New York, Massachusetts, and Ohio.

NASHP’s Prescription Drug Affordability Board (PDAB) model legislation, first released in 2017, defines a PDAB as an entity comparable to a public utility commission, with the ability to establish upper payment limits when a state’s PDAB determines a drug is otherwise unaffordable for state health care purchasers and consumers.

This chart compares state prescription drug affordability review initiatives in Maryland, Maine, New Hampshire, New York, Massachusetts, and Ohio.

Maryland’s PDAB Phased-in Approach

Maryland’s PDAB, enacted in 2019, was based on the NASHP model but initially limits the board’s ability to set upper payment limits to only public purchasers, pending approval by the state legislature. The landmark Maryland law also includes a phased-in approach that could eventually establish upper payment limits for all payers in the state, including the commercial market. The start-up cost for the Maryland PDAB is roughly $750,000 and covers five full-time employees. The funding mechanism for Maryland’s board was vetoed by Gov. Larry Hogan, however the General Assembly recently overrode the veto.

In determining whether a drug is unaffordable, the Maryland board can consider a variety of factors, including:

The wholesale acquisition cost (manufacturers’ list price) or another relevant drug cost index;
Average rebates provided to health plans, pharmacies, and pharmacy benefit managers;
Net drug prices; and
Average patient copay.

In its early meetings, the board began to outline a list of potential drug pricing data sources it will need to access in order to determine an appropriate upper payment limit.

State Approaches that Leverage Purchasing Power

Maine and New Hampshire have also enacted laws creating their own unique PDABs. While these boards are called PDABs, it is important to note that, unlike Maryland, they do not have the authority to set payment limits, but are instead focused on leveraging public purchasing power to lower drug costs.

To accomplish that mission, Maine and New Hampshire’s boards are charged with recommending strategies for public purchasers to lower the cost of prescription drugs in order to meet drug spending targets that will be established by the boards. Ohio enacted a law creating a Prescription Drug Transparency and Affordability Council, but the law does not aim to set upper payment limits. Instead, it established a group of stakeholders to provide recommendations to the governor and legislature on actions that could lower drug costs in Ohio.

Medicaid Models

In addition to the models described above, New York and Massachusetts are engaged in affordability review initiatives that focus on drugs purchased by their states’ Medicaid agencies. As NASHP’s new chart shows, New York and Massachusetts use affordability reviews and direct negotiations with drug manufacturers to attain supplemental rebates on high-cost drugs.

Using Canadian Prices to Set Upper Payment Limits

NASHP’s model legislation’s key strategy was to set enforceable upper payment limits for prescription drugs in order to rein in drug prices. However, particularly with COVID-19’s impact on state budgets, not every state has the resources and capacity to establish a new entity to oversee the robust review of drug costs necessary to establish upper payment limits through a PDAB. During the 2020 legislative session, Washington Gov. Jay Inslee vetoed a number of bills based on cost concerns, including a measure that would have established a PDAB.

In the current 2021 legislative session, four states have introduced bills to establish a PDAB but others have refrained due to budget constraints. To support states facing those budget pressures, NASHP has also released a less costly, alternative approach to setting an upper payment limit – NASHP’s international reference rate model.

Using Canadian drug prices, the model allows a state insurance department to set an upper payment limit for up to 250 high-cost drugs (determined by drug price times utilization). A state could revise the model and use an affordability board structure as well. Canadian prices, which are established with reference to prices in various comparable countries, offer a less costly and labor-intensive process of determining upper payment limits.

Lawmakers in five states (HI, ME, OK, ND, and RI) have introduced or pre-filed bills based on the NASHP’s international reference rate model legislation and more bills are expected to be filed. To learn more about NASHP’s legislative models to curb drug costs and estimated savings from each of them, please contact Jennifer Reck.

In Major Victory for States, Supreme Court Clears the Way for State Health Reform

December 15, 2020/in Model Legislation and Contracts Arkansas Blogs, Featured News Home Legal Resources, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing /by Jennifer Reck and Trish Riley

Last week, states won a clear path to regulating pharmacy benefit managers (PBMs) in a unanimous US Supreme Court ruling in Rutledge vs. Pharmaceutical Care Management Association (PCMA). At issue was whether federal law preempted an Arkansas law (Act 900) that requires PBMs to reimburse pharmacies at no less than what pharmacies pay to acquire drugs, among other provisions.

PCMA, the trade group representing PBMs, argued the Arkansas law was preempted by the Employee Retirement Income Security Act of 1974 (ERISA), the federal law that governs employee benefits. Enacted to protect employee benefit plans from fraud and mismanagement, the law applies to health benefits and – with few exceptions – preempts all state laws that attempt to regulate those plans. While states may regulate fully-insured health insurance plans, they are barred from regulating – either directly or indirectly – health benefits that are paid for directly by employers, often referred to as self-funded plans. More than 60 percent of employees with employer-based coverage are enrolled in such self-funded plans.

View all of NASHP’s model laws that help states curb prescription drug pricing here.

State health policymakers have followed the Rutledge case closely as any ERISA challenge has the potential to impact broader state health care reforms. State health reforms efforts have regularly been subjected to ERISA challenges in the courts, making the acronym ERISA better named in state policy circles as, “Every Roadblock to Innovative State Action.” For example, in Gobeille vs. Liberty Mutual Insurance, the Supreme Court ruled that ERISA preempts states from collecting much-needed data that would improve how they paid for and delivered health care. The Gobeille decision established that self-funded plans do not need to submit health care claims – data needed to advance cost containment efforts – to states.

The 8-0 decision was unequivocal in its ruling that the Arkansas law was not preempted by ERISA. The opinion, authored by Associate Justice Sonia Sotomayor, characterized Arkansas Act 900 as “a form of cost regulation that does not dictate plan choices” and therefore is not preempted by ERISA.

The Rutledge decision, rather than rely on Gobeille’s rationale, expands on the 1995 ERISA case, New York State Conference of Blue Cross & Blue Shield Plans vs. Travelers Insurance, that found that a state’s imposition of surcharges on employer-sponsored health plans was not preempted by ERISA, despite its indirect economic impact on health plans. In that case, the surcharge was assessed on hospital claims. The Rutledge decision extended the Travelers ruling to create a new category of health care cost regulation that surpasses ERISA’ past legal preemptions, paving the way for new state action that exceeds regulation of PBMs that administer benefits for health plans. Protection from ERISA’s preemptions for a broader category of health care cost regulations, as seen in Rutledge, positions states for important and emerging cost containment efforts.

The Rutledge decision is good news for all states, including those that have been recently actively regulating PBMs. Since 2017, 46 states have implemented more than 90 laws regulating PBMs. Some of those laws appear similar to Arkansas’ Act 900, which focused on pharmacy reimbursement, while other laws go further. Examples include laws prohibiting spread pricing – which occurs when PBMs pay pharmacies a lower reimbursement rate for prescriptions and then claim higher rates from a health plan while retaining the difference as profit. Other new laws require PBMs to pass savings from rebates negotiated with drug manufacturers back to health plans and consumers. All of these state PBM regulations are designed to control prescription drug costs. The logic driving the Rutledge decision potentially now shields all of these state laws from ERISA preemption.

The Rutledge ruling represents an important step in the right direction to clarify the scope of ERISA while also enabling states to exercise the regulatory authority needed to take on drug costs – and broader health care costs – in the absence of federal action.

PhRMA Challenges Federal Importation Rule and Canada Limits Exports, States Continue Work

November 30, 2020/in Prescription Drug Pricing Blogs, Featured News Home Administrative Actions, Legal Resources, Model Legislation, Newly-Enacted Laws, Prescription Drug Pricing, State Rx Legislative Action /by Jennifer Reck and Trish Riley

As expected, last week the Pharmaceutical Research and Manufacturers of America (PhRMA) filed suit in US District Court for the District of Columbia to block a new federal rule that allows states to import less costly prescription drugs from Canada. Also last week, the Canadian Minister of Health issued an order prohibiting the bulk export of prescription drugs that face shortages in Canada.

The federal importation rule, slated to go into effect this week, requires states to first obtain certification for their importation programs from the US Secretary of Health and Human Services. To achieve certification, a state program must demonstrate it is safe and has the ability to deliver consumer cost savings.

Rather than leave this certification in the hands of the HHS Secretary, PhRMA along with the Partnership for Safe Medicines and the Council for Affordable Health Coverage asked the federal court to stop the rule, arguing state importation programs cannot be safely implemented while raising questions about their cost-savings.

Canada Limits Rx Exports in Short Supply

The Canadian order, designed to protect that country’s domestic prescription drug supplies, applies to controlled substances (which US federal law already prohibits importation of under any circumstances) and other prescription drugs. An analysis (Q&A: The Facts about Canadian Drug Shortages) of past drug shortages in Canada indicates the majority of shortages have involved generic drugs, which are not a primary target for US importation. State programs are designed to focus on high-cost, brand-name medications that would generate the greatest savings.

NASHP analyzed more than 60 brand-name drugs that states have identified and evaluated for potential importation and found that fewer than a quarter of them had ever appeared on Canada’s lists of drug shortages between March 2017 and January 2020, with only two of them appearing on the list as of January 2020.

State Importation Work Continues

Vermont, Maine, Colorado, and Florida had already submitted their initial importation program designs to HHS Secretary Alex Azar before he issued his final rule on Sept. 24, 2020. Florida recently submitted a second proposal that responds specifically to the requirements laid out in the final rule. Two other states, New Mexico and New Hampshire, plan to submit applications soon to meet deadlines in their state’s importation statutes.

Two other recently issued federal rules related to drug pricing are also expected to face legal challenges by the pharmaceutical industry:

One rule lowers Medicare’s prices for certain drugs to the lowest price available internationally, and
Another ends exemptions allowed by an anti-kickback law that currently protects drug manufacturer rebates.

States have also faced legal challenges for their new laws that prohibit price gouging, regulate pharmacy benefit managers, require drug price transparency, prohibit industry tactics to delay the introduction of generic drugs, tax opioid manufacturers in order to fund state-level efforts to address addiction, and protect consumers from the high cost of insulin.

Despite numerous industry challenges, states are continuing to implement laws and to create new legislative approaches to curb drug costs. As state legislatures reconvene in January, many will continue to press for relief from high drug prices. In the meantime, all eyes are on the federal transition to the Biden Administration and his agenda for drug pricing. States remain active and are eager to partner with the federal government to achieve savings for consumers.

The future of importation may hinge on the Biden Administration’s ability to work with states and the Canadian government to allow importation to succeed while allaying Canadian fears. Meanwhile, states implementing importation continue their hard work. Some states will watch for results while others are pivoting to new strategies such as establishing international reference rates which, in essence, allows a states to import Canadian prices in lieu of importing drugs.