ANNAPOLIS, Md. (AP) — A federal appeals court has struck down Maryland’s first-in-the-nation law against pharmaceutical price gouging.

A divided three-judge panel of the 4th U.S. Circuit Court of Appeals ruled Friday the law is unconstitutional. The ruling says that’s because it regulates transactions that take place outside of Maryland and burdens interstate commerce in prescription drugs.

The Maryland law was approved in last year. It enabled Maryland’s attorney general to sue makers of off-patent or generic drugs that make an “unconscionable” price increase. That was described as an excessive increase, unjustified by the cost of producing or distributing the drug.

Maryland Attorney General Brian Frosh says the state is evaluating all options with regard to next steps.

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