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Committee debates 340B transparency and pharmacy contracting; members seek more data before acting
Summary
Lawmakers and stakeholders debated a bill aimed at state action on the federal 340B drug-pricing program, focusing on transparency, in-state contract pharmacies and reporting; no final vote was taken and parties were asked to refine amendments.
Lawmakers, hospital representatives, pharmacists and industry advocates debated proposed state measures tied to the federal 340B Drug Pricing Program during the Industry, Business and Labor Committee hearing.
Testimony focused on two themes: whether hospitals and covered entities must report how they use savings from 340B-discounted drugs, and whether covered entities should be limited to contracting with pharmacies that have a physical presence in North Dakota. Proponents pressed for disclosure; hospitals and some pharmacies urged caution.
Don Larson of PhRMA described two proposed amendments designed to increase transparency: (1) restrict covered-entity contracts to pharmacies based in North Dakota, and (2) require reporting of acquisition cost, payments received from insurers and total remuneration retained by contract pharmacies. “We would be happy to, work with you on anything else there,” he told the committee.
Advocates asked for state reporting because they said federal audits and program rules do not show local flows of money. “What we’re asking for is to understand what they’re getting the drugs for, what they’re selling them for, so we know what the difference is, what they’re doing with the money as they pocket that difference,” Larson said, citing other states that have pursued similar transparency measures.
Pharmacists and hospital representatives urged care in imposing new reporting. Mike Schwab of the North Dakota Pharmacists Association said federal regulators already perform audits and that HRSA conducts about 200 audits nationwide each year. “In the last 10 years, they’ve conducted 13 audits in North Dakota; 6 of those were found in noncompliance,” Don Larson told the committee during his testimony. Tim Blasell of the North Dakota Hospital Association said hospitals use 340B savings to provide charity care, expand services and support rural health infrastructure and that those benefits are often indirect.
Committee members said they wanted more concrete data before mandating wide reporting or limiting contracting. Representative Koppelman and others said they would support reporting that shows how much of the 340B-related revenue is retained by pharmacies versus health systems; Koppelman asked for a breakdown of remuneration retained by contract pharmacies versus that retained by covered entities.
Lawmakers also questioned narrow limits on contract pharmacies, with some members worrying about specialty drugs not available through in-state pharmacies and border-community impacts. The hospitals’ trade group asked for time to consult members on the logistics of compliance before the committee adopts any reporting regime.
No committee vote was taken on the 340B-related measures. Members asked sponsors and stakeholders to continue negotiations and to provide draft amendments the committee could consider at a later date.
