On Thursday, July 24, three members of Congress introduced the 340B Pharmaceutical Access To Invest in Essential, Needed Treatments & Support (PATIENTS) Act, a bill focused on restoring access to discounted 340B medications, regardless of the manner or location of the pharmacy. Senators Peter Welch (D – Vermont) and Jeff Merkley (D – Oregon), and Congresswoman Doris Matsui (D – California) introduced the bill, which has already garnered support from leading non-for-profit organizations and industry groups.
The 340B PATIENTS Act seeks to eliminate the ability of pharmaceutical companies to place onerous restrictions on Covered Entities on a federal level. The summary of the bill can be found below.
Requirement to Offer 340B Pricing to Covered Entities: Pharmaceutical manufacturers are required to offer medication discount pricing pursuant to section 340B of the Public 22 Health Service Act (42 U.S.C. 256b), regardless of the manner or location of where the medication is dispensed, including contract pharmacies.
Eliminating Conditions from Pharmaceutical Manufacturers: Pharmaceutical manufacturers cannot place conditions on Covered Entities in their ability to purchase and use 340B medications, regardless of the manner or location of where the medication is dispensed, including contract pharmacies.
Monetary Penalties: Any pharmaceutical company who violates these statutory requirements will be subject to civil monetary penalties not to exceed $2 million for each day of such violation.
Since 2010 when HRSA allowed covered entities to contract with an unlimited number of outside pharmacies, regardless of the entity having an onsite, in-house retail pharmacy, the Government Accountability Office (GAO) reported that the number of covered entities participating in the 340B program increased from about 9,700 to 13,000 between 2010 and 2019, and the number of eligible contract pharmacies increased from 1,300 to 23,000 over the same period. As participation in the 340B program has increased, pharmaceutical manufacturers began to impose restrictions on Covered Entities’ use of contract pharmacies due to alleged duplicate discounts and unlawful diversion.
Due to lack of clear language within the regulations, multiple court cases ensued, with verdicts finding in favor of pharmaceutical companies. Specifically, in the case of Novartis and United Therapeutics, the court rejected “HRSA’s position that section 340B prohibits drug manufacturers from imposing any conditions on the distribution of discounted drugs to covered entities.” Similarly, citing precedent, Sanofi Aventis U.S. LLC v. HHS, HRSA erred in concluding that the 340B statute “requires drug makers to deliver drugs to an unlimited number of contract pharmacies.” These cases led numerous states to pass laws eliminating manufacturer restrictions on contract pharmacies in their respective states; while these laws have withheld manufacturer litigation, they are often ignored by the manufacturers
At Advis, we support the bill restoring access to 340B medications so that Covered Entities can obtain increased savings to reach more patients, stretch their resources, and provide more comprehensive healthcare services, especially in rural and underserved populations. We will continue to follow the progress of the 340B PATIENTS Act, as well as any other congressional bill or impending court decision that could affect the 340B program.
For any questions regarding the 340B PATIENTS Act, or for assistance with the 340B Program at your organization, please contact Advis through our website or give us a call at 708-478-7030.
Published July 29, 2025
