This bill mandates that pharmacy benefit managers and health carriers in Minnesota must include lower-cost drugs in their formularies. Specifically, if a formulary includes a brand name drug, it must also include the equivalent generic drug if it has a lower wholesale acquisition cost. Similarly, if a formulary includes a generic drug, it must also include the brand name drug if the latter is cheaper. The bill also requires that if a pharmacy benefit manager or health carrier includes a brand name biologic, it must also include a lower-cost equivalent biosimilar, and vice versa. Additionally, newly approved generic drugs and biosimilars that are less expensive than existing formulary drugs must be added immediately.

Furthermore, the bill stipulates that formulary structures and tiering must prioritize the drug with the lowest out-of-pocket cost to the patient, without imposing prior authorization or other limitations that could hinder patient access. However, there is an exception for cases where the patient's cost-sharing obligation is $25 or less for a generic drug and $55 or less for a brand name drug. The provisions of this bill are set to take effect on January 1, 2026.