Maryland caps Ozempic price for government insurers 2027

Maryland’s Prescription Drug Affordability Board voted on May 18 to cap what state and local government health plans pay for Ozempic, putting a ceiling on the diabetes drug’s price starting January 1, 2027. The board set what it calls an upper payment limit of $274 for a 30-day supply for eligible government purchasers, according to board documents and reports from The Baltimore Sun, STAT and Maryland Matters. Board staff estimated the move could save state and local government plans about $5.8 million a year. The action applies to government purchasers, not the entire commercial market, and Maryland officials have said broader authority would come later. ### Which Maryland programs does the cap actually cover? Maryland’s action covers eligible state and local government purchasers, including state and local government health benefit plans, according to the board’s upper payment limit framework. The Baltimore Sun reported the policy affects state-purchased plans and Medicaid programs, while draft board recommendations also discussed Medicaid, state employee and correctional populations as targets for related GLP-1 purchasing strategies. (baltimoresun.com) The Maryland board is not setting a retail sticker price for every patient in the state. The upper payment limit is a cap on what covered government purchasers would pay under the board’s authority, a narrower step than a statewide cap across all insurance markets. STAT reported the board expects to begin acting in 2028 on upper payment limits for high-cost drugs bought in the commercial insurance market as well. (baltimoresun.com) ### Why did Maryland target Ozempic? Ozempic, the brand name for semaglutide made by Novo Nordisk, was identified by the board as creating affordability challenges for Maryland’s health system and patients, according to board materials and public comments. Citizen’s comments on the draft proposal said Ozempic is approved to help control blood sugar in type 2 diabetes and to reduce certain cardiovascular and kidney risks in those patients. (statnews.com) GLP-1 medicines have become a major cost pressure for payers. Managed Healthcare Executive reported this month that GLP-1 drugs, especially for diabetes, remain a major driver of prescription drug spending because of broader prescribing and demand. Maryland’s move comes as states and insurers look for ways to contain those costs without simply dropping coverage. (citizen.org) ### How did Maryland arrive at the $274 figure? The board’s framework says the $274 upper payment limit for a 30-day supply was benchmarked to the Medicare maximum fair price for calendar year 2027. STAT reported Andrew York, the board’s executive director, said the expected cost was benchmarked against the maximum fair price paid by Medicare. (baltimoresun.com) Board staff used 2023 dispensing data from Maryland state and local government health benefit plan enrollees to estimate savings under that ceiling, according to the framework document. The same document says the projected 2027 maximum fair price would be $274 for a 30-day supply. ### Is Maryland the first state to do this? (statnews.com) Maryland is among a small group of states using prescription drug affordability boards, and STAT reported nine states have been pursuing that model. The Ozempic action is the second time Maryland’s board has taken such a step in recent weeks, according to STAT, after earlier action on another drug. (pdab.maryland.gov) WYPR reported in April that the Ozempic review would move through public comment before a final board vote. That vote happened on May 18, according to Maryland Matters and The Baltimore Sun. ### What happens next before 2027? January 1, 2027, is the date Maryland officials have attached to implementation of the Ozempic payment cap for eligible government purchasers. (statnews.com) Separate draft recommendations posted by the board show Maryland is also considering broader GLP-1 policy options, including a class-wide GLP-1 study, Medicaid participation in federal payment models, and subscription-style purchasing arrangements. (wypr.org) In 2028, Maryland’s board is expected to gain the ability to set upper payment limits for high-cost drugs in the commercial insurance market as well, according to STAT and earlier WYPR reporting. (statnews.com) (pdab.maryland.gov)