OBJECTIVES: Under the Medicaid Drug Rebate Program, some highly rebated brand-name drugs may be less expensive than corresponding generics. We studied how states use their formularies to encourage the use of branded drugs in these cases.

METHODS: We reviewed public Medicaid preferred drug and brand-over-generic lists as of December 2022, including specific brand-over-generic lists and “brand-preferred” designations in preferred drug lists. We identified distinct drugs from each state list. For drugs with “brand preferred” designation, we excluded those with no generic marketed in the US as of December 31, 2022, which was determined based on public data in the Medicaid Drug Rebate Program. We assessed the number of drugs and variability between states.

RESULTS: We identified 7 states with brand-over-generic lists and another 8 states with “brand preferred” designations in their preferred drug lists. The number of brand-over-generic drugs per state ranged from 14 (Wyoming) to 131 (Utah). A total of 294 drugs appeared on at least 1 state list. Most drugs (52.7%) only appeared on one state list, and none appeared on all 15 lists. The most commonly listed drugs were Copaxone (13 states), Advair Diskus (11 states), and Concerta (10 states).

CONCLUSIONS: Few states publicly identified brand-name drugs that were preferred over generics. Among states with brand-over-generic lists, the drugs included varied greatly – more than half of the drugs were identified by a single state. Under the Medicaid Drug Rebate Program, states receive the same statutory rebates, which suggests that highly rebated brand-name drugs should always be preferred over generics. Yet not all states seem to be taking advantage of these rebates, possibly because the federal government administers the rebate program and states lack data or administrative resources. A more standardized brand-over-generic approach between states could lead to savings from using highly rebated brand-name drugs.