Colorado panel looks at capping some prescription drug prices

Colorado’s Prescription Drug Affordability Board will spend the summer beginning the process of determining which prescription drugs will be made affordable for its states residents by capping the prices on those drugs.

The board will choose up to 18 high-cost drugs for review over the next three years to determine whether the medications are unaffordable and whether to cap what health plans and consumers pay for them.

It won’t be a simple task; the board must review hundreds of expensive drugs before they can winnow the list down to 18.

And the board must consider other factors as well. Will they put caps on drugs with extremely high costs but taken by only a few patients, or will they choose expensive drugs taken by a larger group? Should they consider only out-of-pocket costs or the drug’s total cost to the health system?

The board also must determine what is “affordable.”

Hundreds of drugs to consider

Colorado already caps the cost of copays for insulin at $50. But there are hundreds of other drugs the board must consider.

Earlier this month, Colorado released its first list of hundreds of drugs eligible for review, mostly because they each cost more than $30,000 for a course of treatment. In June, the board will release a dashboard ranking those drugs according to the board’s priorities. The dashboard can also be used to examine which drugs have the highest price tags, which have had the largest increases in price, and which the state spends the most on. After that, the board can begin reviewing the drugs for affordability and set payment limits for the first four to eight drugs sometime in 2024. But board members will first have to set their priorities, and those could change from year to year.

Colorado passed a bill creating its board in 2021. Although Colorado is not the only state to begin the process of addressing prescription drug affordability, it has advanced the furthest, Fortune reports.

Colorado not the first state to address prescription drugs

Maryland was the first state to establish a drug affordability board in 2019, but progress slowed amid the pandemic and funding challenges. Maine, New Hampshire, Ohio and Oregon have also established boards, but they lack the authority to limit drug payments. The Inflation Reduction Act of 2022 included a provision requiring the Health and Human Services secretary to negotiate prices with drug companies for a small number of the most costly medications covered by Medicare.

The drug affordability board is not the only measure taken in Colorado to address the cost of prescription drugs.

In 2021, Colorado passed SB21-123, the Expand Canadian Rx Program, which would pave the way to import drugs from Canada, pending approval by Congress.