Source: National Academy for State Health Policy
On March 28, 2025, Colorado’s federal district court dismissed a challenge filed by Amgen, a multinational biopharmaceutical manufacturer, against Colorado’s Prescription Drug Affordability Board (PDAB). Amgen filed a lawsuit in March of 2024, arguing that the establishment of Colorado’s PDAB and its actions were unconstitutional. The district court dismissed the case, finding that Amgen lacked standing. Highlights from the opinion include the following:
- The court found that Amgen did not effectively establish that the company’s profits would be reduced, citing “counterintuitive pricing behavior” across the pharmaceutical supply chain and the inability to predict an upper payment limit.
- The court found that the PDAB’s actions impact only downstream transactions for the reimbursement, sale, and dispensing of prescription drugs to Colorado consumers. As a result, the UPL does not directly impact Amgen, as the UPL does not apply to a wholesaler’s purchase of a drug from a manufacturer.
In 2021, Colorado enacted legislation to establish its PDAB with the goal of identifying unaffordable prescription drugs and improving access for Coloradans by making those drugs more affordable. Under the law, Colorado’s PDAB has the authority to review whether select drugs are unaffordable for consumers and to establish an upper limit on the reimbursement for those drugs determined to be unaffordable. This upper payment limit (or “UPL”) would apply to the fully insured market, state and local government, and self-funded plans that elect to opt in.
Over the past year, the PDAB has reviewed five drugs and found that three drugs, Enbrel, Stelara and Cosentyx, are unaffordable for Coloradans. After making this determination, the PDAB has continued to work towards setting a UPL for Enbrel, an autoimmune disorder drug manufactured by Amgen. Colorado’s first Enbrel rulemaking hearing will take place at its April 11, 2025 PDAB meeting. The establishment of a UPL for Enbrel would be first in the nation.
This case has been closely watched by those in Colorado as well as by seven states currently implementing a PDAB and others considering PDAB legislation. Specifically, three states have the authority to set UPLs (Maryland, Washington and Minnesota). A bill is under consideration in Maryland (SB 357) that would expand the Maryland PDAB’s authority to currently set UPLs for state and local government purchasers only, to all state-regulated purchasers within Maryland.
