This bill aims to enhance access to lower-cost generic and biosimilar drugs within the State Health Benefits Program, School Employees Health Benefits Program, and the State Medicaid program. It mandates that when a brand drug is prescribed to a covered person who has not previously used that drug, a biosimilar must be provided if available. Additionally, vendors and managed care organizations are required to maintain and publish an accurate and accessible list of all covered drugs, including any tiering structures and restrictions. The bill also stipulates that if a generic or biosimilar drug is licensed by the FDA and has a lower wholesale acquisition cost than its reference drug at the time of marketing, it must be made available on the formulary with favorable cost-sharing and without prior authorization or other limitations.

Furthermore, the bill clarifies that vendors and managed care organizations are not obligated to continue coverage for a brand drug once a generic or biosimilar is available, nor are they required to cover any drug deemed not medically appropriate or cost-effective by formulary developers. The definitions of "Biosimilar," "Brand drug," and "Generic drug" are provided to ensure clarity in the implementation of these provisions. The act is set to take effect on January 1, 2027, applying to all relevant contracts and policies initiated or renewed after that date.