Colorado First State to Place Price Cap on Prescription Drug

November 27, 2025
Hall Benefits Law, LLC

The state of Colorado has made history as its Prescription Drug Affordability Review Board has placed a price limit on the prescription drug Embrel from Immunex Corp. Embrel is used to treat rheumatoid arthritis and other autoimmune diseases.

The Colorado Consumer Health Initiative estimates that the price cap could save consumers $32 million in drug spending. About 60% of the 2,500 individuals in Colorado who take Enbrel have private insurance. Before the price cap, patients paid about $4,000 of the annual $58,000 cost of the drug. Now, the price of Embrel is capped at about $31,000 per year, and patients have a payment of about $600.

The Board’s decision follows four years of debate over the issue. Some groups warned that placing price caps on prescription drugs could incentivize drug manufacturers to pull out of the state or cause insurers to stop covering the drug altogether. Some criticize the decision as having unintended consequences that will only harm patients and fail to adequately address barriers to affordability.

Insurance companies also expressed concerns about the Board’s move, warning of changes to drug formularies, elimination of coverage and tiering levels, and increased copayments for the drugs. Pharmacists also exhibited reservations about losing business and/or profits due to low reimbursement rates for expensive drugs.

The Board, which Colorado lawmakers created in 2021, can set price limits after a comprehensive decision-making process encompassing data analysis, public comment periods, rulemaking hearings, and votes.

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Hall Benefits Law, LLC

HBL offers employers comprehensive legal guidance on benefits in mergers and acquisitions, Employee Stock Ownership Plans (ESOPs), executive compensation, health and welfare benefits, healthcare reform, and retirement plans. We counsel a wide spectrum of clients including small, mid-sized, and large companies, 401(k) investment advisors, health insurance brokers, accountants, attorneys, and HR consultants, just to name a few. HBL is passionate about advising clients, and we are dedicated to our mission: to provide comprehensive, personalized, and practical ERISA and benefits legal solutions that exceed client expectations.

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