Bass, Berry & Sims attorney Jeff Davis provided comments for a Bloomberg Law article examining the pending lawsuits that many drug manufacturers and others have filed against state laws prohibiting the drug companies from restricting the supply of discounted drugs to certain pharmacies under the federal 340B Drug Pricing Program. Many states have recently passed legislation protecting the use of 340B contract pharmacy arrangements, leading to manufacturers challenging the state laws in various courts. The Eighth Circuit Court of Appeals has ruled in favor of an Arkansas law prohibiting contract pharmacy restrictions, and other cases are pending.
Manufacturers are challenging these state laws against the backdrop of other cases in federal courts considering whether the federal government can stop contract pharmacy restrictions under the 340B statute, with two federal circuit courts allowing contract pharmacy restrictions to proceed. But while those decisions largely found in favor of manufacturers, they also recognize the manufacturers’ obligation to offer the 340B prices, Jeff said.
“There are a lot of instances—because of drug manufacturers’ limited distribution networks or payer restrictions on pharmacy network access—where a covered entity may not have access to a drug,” he added. “In order for the manufacturer to keep its obligation under the 340B law, the appeals courts meant we need to recognize contract pharmacy arrangements because otherwise the manufacturer is not meeting its obligation to offer 340B prices.”
The full article, “Pharma Industry Ramps Up Legal Fight of State Drug Discount Laws,” was published by Bloomberg Law on August 7 and is available online.