The format list with paragraph format and headings level should work like the DropDown component:

• should use role="menu" and role="menuitem"
• should use arrows navigation
• all the items are <span> elements: with role="menuitem" their semantic would be OK but worth considering to use a natively interactive element (button?) to simplify the JS part
• not sure why it is using aria-hidden="true" on the items
• the toggle button needs a focus style, see for example the style used on the similar block switcher toggle button:

Todo: consider to re-use the DropdownMenu component