Senate adopts bill aimed at protecting 340B contract pharmacy arrangements

The Colorado Senate on March 25 adopted Senate Bill 71, legislation intended to prevent pharmaceutical manufacturers from restricting contract pharmacy arrangements for providers participating in the federal 340B drug-pricing program and to add state-level transparency requirements.

Senator Michaelson Genet moved the Health and Human Services committee report and introduced amendments L16 and L17 on the floor. Senator Rich, speaking in favor of SB71, said the 340B program allows safety-net providers to stretch scarce federal resources to reach more patients and described the proposed state protections as necessary to prevent “big pharma” from hindering access to discounted drugs that community hospitals and clinics use to support charity care and outreach.

Supporters presented data in floor remarks showing substantial community benefits tied to 340B participation and argued that restrictions by manufacturers could force some rural hospitals and clinics to curtail services or close. “The savings 340B hospitals achieve through purchasing certain outpatient drugs at a discount allows healthcare providers to stretch scarce federal resources,” one sponsor said.

Some senators cautioned that federal reform is needed and pressed for clarity about how state changes would interact with existing federal rules. Senator Mullica and other senators supported amendments adding transparency and limiting certain uses of savings; sponsors said those amendments made the bill stronger and focused on protecting patient access rather than reallocating funds.

After amendments were adopted and extended floor discussion, the Senate adopted SB71. Senators and sponsors said the bill aims to preserve stability for clinics, critical access hospitals and federally qualified health centers that rely on 340B savings to provide care for underserved populations.