Virginia and Hawaii Introduce PDAB Legislation

Gov. Abigail Spanberger (D) is expected to sign legislation that would establish a Prescription Drug Affordability Board (PDAB). Numerous versions of this bill have been introduced in Virginia for the past five years but have either stalled in the legislature or been vetoed by Spanberger’s Republican predecessor.

The proposed legislation would create a PDAB panel responsible for conducting data analyses, developing policy recommendations, and identifying implementation barriers related to strategies to improve prescription drug affordability and enhance price transparency for prescription drugs across public and private payers. The panel would be required to submit an annual report detailing drug pricing trends and offering policy recommendations to improve affordability. Additionally, the bill establishes that manufacturers are prohibited from accepting payment at an amount higher than the referenced drug price set by the Medicare Drug Price Negotiation Program, if a drug has one.

Unlike other state PDAB legislation, the measure also includes a few PBM requirements, such as a minimum dispensing fee of $10.65 per script. The dispensing fee mandate has gotten the attention of the Department of Human Resource Management (DHRM) which has jurisdiction over the state’s employee health plan. DHRM estimates that applying the higher dispensing fee would increase pharmacy claim costs to the state health plan by over $6.5 million annually.