Prescription Drug Affordability Board Activity, June 2025

​CANN and Affordable Cancer Drugs Alliance submitted written comments.  There were no oral comments.

Matthew J. Martin, MA, is a Program Coordinator with the Program On Regulation, Therapeutics, and Law (PORTAL) at Brigham and Women's Hospital. Dr. Benjamin Rome is general internist and health policy researcher at Harvard Medical School and a faculty member in the Division of Pharmacology and Pharmacoeconomics in the Department of Medicine at Brigham and Women’s Hospital. They presented federal drug pricing updates focused on most- favored-nation drug pricing, PBM reform, Medicare and Medicaid changes, and the 340B Drug Discount Program. 

The PORTAL team presented on four executive orders relevant to the PDAB::

• E.O. 14221: Provisions related to healthcare price transparency, which include prescription drug provisions 
• E. O. 14273: A slew of provisions related to drug pricing
• E. O. 14293: Promotes domestic drug manufacturing
• E. O. 14297: Implementing most favored nation pricing 

Congressional:

• One Big Beautiful Bill Act, which includes drug provisions 

E. O. 14297 

The most-favored-nation drug pricing executive order outlined federal government actions that would align the price Americans pay for drugs with other developed nations. There are three sections to the executive order that outline how the administration imagines implementing price changes. The order 

1. targeted “freeloading on U.S. innovation” by directing the U.S. Commerce Department to take action against countries that artificially deflate prices paid for drugs in other countries, which would drive prices up for American patients; 
2. directed federal agencies, mainly HHS, to facilitate direct-to-consumer sales of drugs at the most favored nation price with manufacturers; 
3. instructed relevant agencies to communicate its most favored nation price with manufacturers within 30 days. This resulted in an HHS press release indicating that the MFN target would be considered the lowest price in an OECD country that has a per capita GDP at least 60% of the US’s per capita GDP. The EO also listed a slate of policy options that agencies could implement if manufacturers cannot agree on a price. 

 

One Big Beautiful Bill Act

[Ed. note: These notes reflect the situation at the time of the meeting. PBM reform did not appear in the final pill.]

The One Big Beautiful Bill Act addressed PBM reform, specifically for Medicare and Medicaid. This section of the bill would have prohibited spread pricing in Medicaid, limit payments that PBMs give to pharmacies to the ingredient costs, and limit payments from plans for PBMs. There were also transparency provisions requiring PBMs to submit data about costs, payments, and drug fees to state Medicaid programs and HHS upon request. 

Medicare provisions were included in the House bill, but not in the Senate version, which would limit payments to PBMs by Part D plans to a bona fide service fee. It would also require that the PBM-negotiated manufacturer rebates pass through to the Part D plan sponsor, and require PBMs to annually report to HHS and Part D plan sponsors about operations and the drugs and costs that are moving through the PBM on behalf of the plan. Medicaid drug reimbursement reforms were also included in this section of the bill, whic hwould require all retail pharmacies and applicable non-retail pharmacies that accept Medicaid to participate in the NADAC survey. 

Medicare negotiation program

Martin also presented on the three tracks of the Medicare negotiation program currently in process. The program continues to move forward as it was designed in the Inflation Reduction Act. The 2026, 2027, and 2028 cycles are all in effect, and prices are being negotiated. The current administration commented on the 2028 cycle, prioritizing an increase in transparency of these negotiations. In tandem with these negotiations are two congressional bills that would change how the program operates. This includes the Orphan Cures Act and the Ensuring Pathways to Innovative Cures (EPIC) Act. The other policies that would affect Medicare and Medicaid include E.O. 14273, which would ensure manufacturers are paying accurate rebates and promoting innovation in Medicaid, and supporting Medicare's ability to obtain better value for drugs. 

 

Lastly, PORTAL presented on changes to the FDA, talking about efforts to streamline both the process for drug importation through Section 804 and the regulations and guidance from the FDA and EPA for domestic drug manufacturing. The FDA has also been directed to increase fees and inspections of foreign drug manufacturing sites, and to  accelerate drug approvals. 

 

Stakeholder Council members asked about tariffs, most-favored-nations loopholes and implementation challenges, and the “pill penalty.” 

Kelly Shultz, the CEO of the Maryland Tech Councils, presented on the Maryland Biotech Sector, beginning by noting that Maryland is the third largest biopharma region in the country, and one of the most sought-after for professionals. She highlighted new facilities coming to the state, including those from AstraZeneca and the University of Maryland. Shultz identified lack of growth, global competition, and policy challenges as the challenges facing the Maryland Biotech Sector. Lastly, she stressed an investment in talent for the future of the biotech industry in Maryland. 

The Stakeholder Council asked questions about transparency concerns, policy priorities, and policies to reconcile the challenges China presents to the industry.

Two new members of the Stakeholder Council were introduced. Pallavi Arora from the Maryland Hospitals Association is the new representative for hospitals. Kathleen Loughran from Elevance Health is the representative for managed care organizations. 

The update on the cost review study process is that they are collecting more materials and comments related to Farxiga and Jardiance through July 3.