Key Takeaways
- The Arkansas State Board of Pharmacy has indefinitely suspended enforcement of Act 630, which restricted drug manufacturers from maintaining limited distribution networks that excluded Arkansas-based pharmacies.
- A federal court found that Act 630 likely violates the dormant Commerce Clause by facially discriminating against out-of-state pharmacies, and the Arkansas Attorney General’s office has indicated it will not appeal.
On July 28, following several constitutional challenges by drug manufacturers and specialty pharmacies, the Arkansas State Board of Pharmacy (Board) adopted a resolution indefinitely suspending enforcement of Act 630, which restricted manufacturers from maintaining limited distribution networks that did not include Arkansas-based pharmacies. The Board’s vote followed a federal court’s decision preliminarily enjoining enforcement of Act 630 on dormant Commerce Clause grounds as to one manufacturer, and the resolution now extends a policy of non-enforcement to all manufacturers and pharmacies.
What Does Arkansas Act 630 Require of Drug Manufacturers?
Act 630, codified at Ark. Code Ann. § 20-64-105, prohibits manufacturers that seek payment from certain payors in the state from restricting or limiting distribution of prescription medications to a limited network of pharmacies unless the manufacturer can demonstrate that the limitation supports patient health and safety. Absent a waiver, Act 630 prohibits a pharmaceutical manufacturer from maintaining a limited distribution network more than three months after launching a new product without offering similar access to various categories of Arkansas-based pharmacies.
A manufacturer seeking to maintain a limited network for longer than six months is required to obtain Board approval, supported by a justification tied to the Board’s mission to protect public health, safety and welfare, with the Board authorized to weigh cost, logistics, patient caseload and drug or disease rarity, among other factors. And an approved limited network must allow some pharmacies in Arkansas, upon request or application, to participate and access the medications to meet the needs of patients with same-day access in the state without requiring patients to use out-of-state or in-state mail carriers for access.
Act 630 threatens noncompliant manufacturers with penalties of up to $10,000 per day and the potential loss of Arkansas Medicaid coverage across their entire portfolio.
How Did Novartis Challenge Act 630 in Federal Court?
In June 2025, Novartis Pharmaceuticals Corporation filed suit against the Arkansas Attorney General and members of the Board in the U.S. District Court for the Eastern District of Arkansas, seeking to enjoin enforcement of Act 630 on dormant Commerce Clause and federal preemption grounds. On May 17, 2026, Judge Lee Rudofsky granted Novartis’ motion for a preliminary injunction, holding that Novartis was likely to succeed on the merits of its Commerce Clause claim.
The court found that Act 630 facially discriminates against out-of-state pharmacies by conditioning a manufacturer’s ability to maintain a limited network on providing in-state pharmacies access to that network, and that Arkansas had not shown the absence of less discriminatory means of achieving the law’s stated goals of improving accessibility, safety, emergency readiness and patient choice. Notably, although Novartis had not raised a void-for-vagueness argument, the court also flagged that several of Act 630’s operative provisions are, in the court’s words, “grammatically and syntactically incoherent,” raising serious due process concerns independent of the Commerce Clause holding.
The court’s preliminary injunction, however, ran only in favor of Novartis. Under the U.S. Supreme Court’s 2025 decision in Trump v. CASA, Inc., injunctive relief generally may not extend beyond the parties before the court, and the court expressly limited its order on that basis. As a result, following the decision in Novartis, Act 630 had remained enforceable against all other manufacturers, pharmacies and dispensers with an approaching September 1, 2026, effective date.
Other Lawsuits Filed Against Act 630
Two additional suits followed the Novartis decision, which were also assigned to Judge Rudofsky. On June 23, 2026, Bristol Myers Squibb Company (BMS) filed suit, seeking a preliminary injunction on Commerce Clause, preemption, and vagueness grounds substantially similar to those raised in Novartis. On July 10, 2026, Accredo Health Group, Inc. and Express Scripts Specialty Distribution Services, Inc. (ESSDS)—two out-of-state specialty pharmacies included in manufacturers’ limited distribution networks—filed a suit of their own. Accredo and ESSDS argued that they were among the out-of-state pharmacies the Novartis court found Act 630 “directly injures,” and that they were likewise entitled to injunctive relief on dormant Commerce Clause grounds.
The Arkansas Board of Pharmacy’s Non-Enforcement Resolution
On July 28, the Arkansas Attorney General’s office presented the Board with two resolutions addressing Act 630, and the Board adopted both unanimously. The first authorizes settlement of the pending Novartis, BMS and Accredo/ESSDS litigation. The second, broader resolution adopts a policy of non-enforcement of Act 630 as to all entities, whether or not they are parties to litigation, and is intended to forestall any additional suits.
In presenting the resolutions, the Attorney General’s office advised the Board that continued enforcement of Act 630 would likely be legally indefensible in light of the Novartis ruling, while characterizing the statute as “likely unconstitutional.” The Attorney General’s office further indicated that it does not intend to appeal the Act 630 ruling.
The Attorney General’s office clarified that Act 630 remains codified and will stay on the books absent repeal by the legislature, but that it expects the practical effect of the non-enforcement resolution to be the same as a permanent injunction.
To that end, in light of the decision to no longer enforce Act 630, the Board confirmed that it would no longer review or process any applications by manufacturers for waivers of the law’s requirements, and that any future applications would be ignored.
Considerations Going Forward for Drug Manufacturers & Specialty Pharmacies
As a result of the Board’s action, manufacturers and specialty pharmacies should not be subject to enforcement under Act 630 going forward. However, because the statute remains on the books and the Board’s action constitutes merely a policy of non-enforcement, rather than a judicial invalidation or legislative repeal, manufacturers and pharmacies should continue to monitor legislative and legal developments.
Indeed, the Board’s resolutions may not be the final word on these issues. Following the resolutions, Act 630’s legislative sponsor, a practicing pharmacist, publicly expressed disappointment in the outcome and stated that he would explore amending the law in a future legislative session to attempt to resolve the constitutional infirmities.
If you have any questions about this update, please contact the authors.