How can states push back against drug manufacturers’ restrictions on the federal 340B Drug Pricing Program? With strong coalitions, a sharp sense of political timing, and relentless grassroots efforts, say leaders of ASHP affiliates in Tennessee and Missouri.
Tennessee and Missouri pharmacists recently helped advocate for state laws that expanded protections for 340B-covered entities and their contract pharmacy arrangements. In both states, tight coalitions of pharmacists, hospitals, and primary care providers pushed the legislation.
Though drug manufacturers have sued both states over the legislation, these laws represent critical steps toward ensuring equitable treatment of the hospitals and health systems that participate in the 340B program — and the patients they serve, said Tom Kraus, ASHP vice president of government relations.
“Health systems use contract pharmacies in their 340B programs to expand access for patients, particularly those in rural areas who do not live close to main campuses,” said Kraus. “States are leading the way in helping stop drug manufacturers from restricting our members’ efforts to improve patient access.”
State of the States
Every year, state legislatures make thousands of health policy decisions, including ones that affect pharmacy practice. In a new series, State of the States, ASHP News Center will profile ASHP state members and affiliates as they help shape decisions and policies important to the pharmacy workforce.
Along with partners American Hospital Association and 340B Health, ASHP has filed “friend of the court” briefs in multiple states to defend these 340B contract protections.
Drug manufacturers in 2020 began attempting to limit 340B-covered entities’ use of contract pharmacies. Federal regulators objected, and the issue landed in court. As that legal case was underway, states, starting with Arkansas, saw a need to put their own protections in place.
So far, 18 states have some level of protection for 340B contract pharmacy arrangements, with many of these laws aligned with ASHP’s model state legislation. Most of those states — 13 — passed legislation just this year.
Tennessee was one of them.
Members of the Tennessee Pharmacists Association (TPA) had for several years swapped stories of how manufacturers were increasingly trying to limit health systems’ use of contract pharmacies, but figured it was more of a federal than state issue, said TPA CEO Anthony Pudlo.
But as other states, including Arkansas, Louisiana, and West Virginia, passed laws protecting these contract arrangements, TPA members sensed potential in crafting something similar. In 2024, the TPA House of Delegates voted to push for 340B protections as a legislative priority.
TPA staff talked with their counterparts at the Tennessee Primary Care Association, whose members were also concerned about actions that drug manufacturers were taking against 340B-covered entities. The two groups decided to collaborate on an advocacy push; eventually, the coalition pulled in the Tennessee Hospital Association, and other 340B-covered entities. TPA members also began outreach campaigns to their state legislators.
“The messaging was clear,” said Pudlo. “We're here to protect those vulnerable populations in our state that need the benefits of the 340B program.”
Attacks on their efforts were intense, he said, and at one point, opponents managed to attach an unfounded $14 million price tag to the bill. But the coalition stuck together, and supportive lawmakers removed the price tag.
“Our legislative champions had to bulldog this thing through,” said Pudlo.
In Missouri, pharmacy groups, including the Missouri Society of Health-System Pharmacists (MSHP), last year teamed up with the Missouri Hospital Association to pass legislation that prohibited drug manufacturers from refusing to supply the discounted 340B drugs to covered entities and their contract pharmacies.
The successful push was years in the making. An earlier version of the legislation appeared in 2020 but did not advance. When it was proposed, again, in 2024, the legislation also addressed white bagging and pharmacy benefit manager accountability, said Daniel Good, vice president of pharmacy at Mercy Health System and past president of MSHP.
But supporters were once again receiving strong opposition from drug manufacturers, he said, so the coalition made a tactical decision to narrow the bill to contract pharmacy protections only.
“The 340B piece is the one that we thought we might be able to get through,” said Good, who also served as past chair of MSHP’s Public Policy Committee.
Good noted that though Mercy has its own pharmacies, the system can’t cover the entire 340B patient population without the help of contract pharmacies.
In Missouri, building coalitions, sharing patient stories, and recognizing what had the best chance of passing were key to the legislation’s success, said Good.
“Make sure the coalition stays together,” said Good. “Make sure you have constituencies that are tied with you: get patient advocacy groups, whether it is those who are oncology patients, pediatric patients, rural health patients. Because that's what (lawmakers) really want to hear. They want to hear those stories of how it's affecting the lives of those voters in their district.
“Don't just do your work in the state capitol. You’ve got to do your work back home where those representatives are coming into coffee shops where their kids are going to school and playing soccer right there next door. You’ve got to do your homework at home, as well as in the state capitol."
Pudlo had similar advice, adding that 340B legislation isn’t the avenue for getting creative; instead, he suggested advocates observe what other states have done.
“Don't go off and try to do something bigger and fancier,” Pudlo said. “These laws are still getting tested in the court system.”
He added that 340B has supporters across the political spectrum, so education is a critical piece. “Congress is on all sides of the aisle, too,” he said. “So do what you can to educate people about the value of the program.”
