First Regular Session
Seventy-fifth General Assembly
STATE OF COLORADO
INTRODUCED
LLS NO. 25-0361.02 Brita Darling x2241
SENATE BILL 25-071
Senate Committees House Committees
Health & Human Services
A BILL FOR AN ACT
C
ONCERNING CERTAIN PRACTICES BY PERSONS PARTICIPATING IN THE101
SUPPLY CHAIN OF DRUGS PURCHASED UNDER THE FEDERAL 340B102
DRUG PRICING PROGRAM .103
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov
.)
Under the federal 340B drug pricing program (340B program), a
covered entity, including certain hospitals, programs, and federally
qualified health centers (covered entity), that serves patients with low
income receives discounted outpatient drugs (340B drugs) from
manufacturers that participate in the federal medicaid and medicare
SENATE SPONSORSHIP
Michaelson Jenet and Rich, Hinrichsen
HOUSE SPONSORSHIP
Martinez and Taggart,
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law. programs.
Unless the receipt of 340B drugs is prohibited by the federal
department of health and human services, the bill prohibits a
manufacturer, wholesaler, third-party logistics provider, or repackager in
this state, or an agent, contractor, or affiliate of those entities, including
an entity that collects or processes health information, from directly or
indirectly denying, restricting, prohibiting, discriminating against, or
otherwise limiting the acquisition of a 340B drug by, or delivery of a
340B drug to, a covered entity, a pharmacy contracted with a covered
entity, or a location otherwise authorized by a covered entity to receive
and dispense 340B drugs.
The bill also prohibits a manufacturer from directly or indirectly
requiring a covered entity, a pharmacy contracted with a covered entity,
or any other location authorized to receive 340B drugs by a covered entity
to submit any health information, claims or utilization data, or other
specified data that does not relate to a claim submitted to certain federal
health care programs, unless the data is voluntarily furnished or required
to be furnished under federal law.
A violation of the prohibitions in the bill is an unfair or deceptive
trade practice under the "Colorado Consumer Protection Act" (act), and
the violator is subject to the enforcement provisions and penalties
contained in that act. The attorney general may investigate and enforce
the provisions of the bill, as well as a business harmed by a violation of
the provisions of the bill. In addition, a person regulated by the state
board of pharmacy (pharmacy board) that violates the provisions of the
bill may be subject to discipline by the pharmacy board against the
person's license, certification, or registration, as well as other penalties.
The bill requires a covered entity that is a hospital to annually post
on its public-facing website information concerning the annual, estimated,
aggregate financial benefit to the hospital covered entity resulting from
its ability to acquire pharmaceuticals at a discount through the 340B
program and a description of how the hospital covered entity uses savings
from participation in the 340B program.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. In Colorado Revised Statutes, 6-1-105, add (1)(iiii)2
as follows:3
6-1-105. Unfair or deceptive trade practices - definitions.4
(1) A person engages in a deceptive trade practice when, in the course of5
the person's business, vocation, or occupation, the person:6
SB25-071-2- (iiii) VIOLATES ARTICLE 29 OF THIS TITLE 6.1
SECTION 2. In Colorado Revised Statutes, add article 29 to title2
6 as follows:3
ARTICLE 294
Colorado 340B Contract Pharmacy Protection Act5
6-29-101. Short title. T
HE SHORT TITLE OF THIS ARTICLE 29 IS THE6
"C
OLORADO 340B CONTRACT PHARMACY PROTECTION ACT".7
6-29-102. Legislative declaration. (1) T
HE GENERAL ASSEMBLY8
FINDS AND DETERMINES THAT:9
(a) T
HE 340B DRUG PRICING PROGRAM REQUIRES DRUG10
MANUFACTURERS TO PROVIDE DRUG DISCOUNTS ON IDENTIFIED11
OUTPATIENT DRUGS TO 340B COVERED ENTITIES AS A CONDITION OF12
MEDICAID AND MEDICARE PART B COVERING THOSE DRUGS;13
(b) C
ONGRESS CREATED THE 340B PROGRAM IN 1992, STATING14
THAT THE PROGRAM'S BENEFITS "ENABLE [COVERED] ENTITIES TO STRETCH15
SCARCE FEDERAL RESOURCES AS FAR AS POSSIBLE , REACHING MORE16
ELIGIBLE PATIENTS AND PROVIDING MORE COMPREHENSIVE SERVICES ."17
(H.R.
REP. NO.102-384 (II), AT 12 (1992)).18
(c) T
HE 340B PROGRAM SUPPORTS COLORADO'S MEDICALLY19
VULNERABLE AND UNDERSERVED POPULATIONS BY PROVIDING20
ADDITIONAL RESOURCES TO 340B COVERED ENTITIES AND ALLOWING21
THESE ENTITIES TO DETERMINE THE MOST EFFECTIVE USE OF THESE22
RESOURCES;23
(d) T
HE 340B PROGRAM IS A CRITICAL COMPONENT OF24
C
OLORADO'S SAFETY NET INFRASTRUCTURE;25
(e) C
OLORADO HAS SIXTY-EIGHT HOSPITALS STATEWIDE THAT26
PARTICIPATE IN THE 340B PROGRAM, WITH NEARLY NINETY PERCENT OF27
SB25-071
-3- THESE HOSPITALS OPERATING UNDER UNSUSTAINABLE LONG -TERM1
MARGINS;2
(f) A
DDITIONALLY, COLORADO HAS TWENTY FEDERALLY3
QUALIFIED HEALTH CENTERS, OR FQHCS, ALL OF WHICH PARTICIPATE IN4
THE 340B PROGRAM AND SIXTY-FIVE PERCENT OF WHICH CURRENTLY5
OPERATE WITH NEGATIVE MARGINS ;6
(g) C
OLORADO HOSPITALS PARTICIPATING IN THE 340B PROGRAM7
UTILIZE PROGRAM BENEFITS TO ADDRESS THEIR COMMUNITIES ' UNIQUE8
NEEDS, WHICH INCLUDE PROVIDING DIRECT PRESCRIPTION DRUG9
DISCOUNTS, SUBSIDIZING UNCOMPENSATED CHARITY CARE AND MEDICAID10
UNDERPAYMENTS TO REMAIN FINANCIALLY OPERATIONAL , SUPPORTING11
OPIOID USE DISORDER TREATMENT , FUNDING MOBILE HEALTH-CARE AND12
IMMUNIZATION CLINICS, AND PAYING FOR CHEMOTHERAPY AND INFUSION13
CENTERS;14
(h) C
OLORADO'S FQHCS ARE THE PRIMARY CARE MEDICAL HOME15
FOR ONE IN SEVEN COLORADANS, WITH EIGHTY-NINE PERCENT OF FQHCS'16
PATIENTS IN 2023 LIVING WITH FAMILY INCOMES BELOW TWO HUNDRED17
PERCENT OF THE FEDERAL POVERTY GUIDELINE AND TWENTY -THREE18
PERCENT WERE UNINSURED ;19
(i) C
OLORADO'S FQHCS UTILIZE 340B PROGRAM BENEFITS TO20
ADDRESS THEIR COMMUNITIES' UNIQUE NEEDS, WHICH INCLUDE REDUCED21
DRUG PRICES FOR PATIENTS, PROVIDER RECRUITMENT AND RETENTION ,22
AND EXPANSION OF ORAL HEALTH AND BEHAVIORAL HEALTH SERVICES23
THAT THE FQHCS WOULD OTHERWISE NOT BE ABLE TO OFFER ;24
(j) F
URTHER, COLORADO'S FQHCS EXPERIENCED AN ESTIMATED25
LOSS OF FOUR MILLION THREE HUNDRED DOLLARS IN 340B PROGRAM26
SAVINGS IN THE LAST TWO YEARS;27
SB25-071
-4- (k) CONVERSELY, IN 2023, SIXTEEN OF THE LARGEST1
PHARMACEUTICAL COMPANIES REPORTED SIX HUNDRED EIGHTY -FOUR2
BILLION DOLLARS IN EARNINGS IN THEIR ANNUAL FINANCIAL REPORTS , A3
FIGURE THAT WAS HIGHER THAN THE GROSS DOMESTIC PR ODUCT OF4
EIGHTY-EIGHT PERCENT OF THE COUNTRIES IN THE WORLD ;5
(l) I
N ADDITION, THE EIGHT LARGEST PHARMACEUTICAL6
COMPANIES PAID A COMBINED TWO BILLION DOLLARS IN FEDERAL TAXES7
ON TWO HUNDRED FOURTEEN BILLION DOLLARS OF DOMESTIC REVENUE IN8
2022,
ACCORDING TO THEIR 10-K ANNUAL FINANCIAL REPORTS;9
(m) I
N 2022, COLORADO HOSPITALS PROVIDED TWO BILLION ONE10
HUNDRED MILLION DOLLARS OF COMMUNITY BENEFIT ;11
(n) S
TARTING IN 2020, PHARMACEUTICAL MANUFACTURERS BEGAN12
TO UNLAWFULLY PLACE RESTRICTIONS ON 340B COVERED ENTITIES USING13
CONTRACT PHARMACIES TO DISPENSE DRUGS TO PATIENTS , UNILATERALLY14
LIMITING THE 340B PROGRAM'S BENEFITS; AND15
(o) I
N A LETTER DATED JULY 28, 2023, FROM WILLIAM TONG,16
ATTORNEY GENERAL OF CONNECTICUT, TO THE UNITED STATES SENATE17
340B
WORKING GROUP, AND SIGNED BY TWENTY-TWO OTHER BIPARTISAN18
ATTORNEYS GENERAL , THE ATTORNEYS GENERAL DECLARED THAT19
"
OUTPATIENT PHARMACIES ARE A KEY MECHANISM FOR THE DELIVERY OF20
LIFE-SAVING DRUGS TO ELIGIBLE PATIENTS, INCLUDING THOSE WHO HAVE21
LIMITED ACCESS TO TRANSPORTATION , LIVE IN REMOTE OR RURAL AREAS,22
OR ARE CONFINED TO THEIR HOMES AND RELY ON MAIL -ORDER23
PHARMACIES."24
(2) T
HEREFORE, THE GENERAL ASSEMBLY DECLARES THAT THIS25
ARTICLE 29 PROHIBITING PHARMACEUTICAL MANUFACTURERS FROM26
IMPOSING LIMITATIONS OR PLACING RESTRICTIVE CONDITIONS ON 340B27
SB25-071
-5- COVERED ENTITIES IS NECESSARY TO PROTECT COLORADO'S VULNERABLE1
PATIENTS AND SAFETY NET PROVIDERS AND TO ENSURE THAT2
MUCH-NEEDED FINANCIAL RESOURCES GENERATED BY THE 340B PROGRAM3
REMAIN IN COLORADO.4
6-29-103. Definitions. A
S USED IN THIS ARTICLE 29, UNLESS THE5
CONTEXT OTHERWISE REQUIRES :6
(1) "340B
COVERED ENTITY" OR "COVERED ENTITY" HAS THE7
MEANING SET FORTH IN SECTION 340B (a)(4) OF THE FEDERAL "PUBLIC8
H
EALTH SERVICE ACT", 42 U.S.C. SEC. 256b (a)(4).9
(2) "340B
DRUG" MEANS A DRUG THAT:10
(a) I
S A COVERED OUTPATIENT DRUG WITHIN THE MEANING SET11
FORTH IN 42 U.S.C. SEC. 256b;12
(b) H
AS BEEN SUBJECT TO ANY OFFER FOR REDUCED PRICES BY A13
MANUFACTURER PURSUANT TO 42 U.S.C. SEC. 256b (a)(1); AND14
(c) I
S PURCHASED BY A COVERED ENTITY . AS USED IN THIS15
SUBSECTION (2)(c), A DRUG IS CONSIDERED "PURCHASED" IF IT WOULD16
HAVE BEEN PURCHASED BUT FOR THE RESTRICTION OR LIMITATION17
DESCRIBED IN SECTION 6-29-105.18
(3) "340B
DRUG PRICING PROGRAM" OR "340B PROGRAM" MEANS19
THE PROGRAM DESCRIBED IN 42 U.S.C. SEC. 256b (a)(1).20
(4) "B
OARD" MEANS THE STATE BOARD OF PHARMACY CREATED IN21
SECTION 12-280-104.22
(5) "F
EDERAL HEALTH CARE PROGRAM " HAS THE MEANING SET23
FORTH IN SECTION 42 U.S.C. SEC. 1320a-7b (f).24
(6) "H
EALTH INFORMATION" MEANS INFORMATION, INCLUDING25
DEMOGRAPHIC INFORMATION COLLECTED FROM AN INDIVIDUAL OR A26
GROUP OF INDIVIDUALS THAT:27
SB25-071
-6- (a) IS CREATED OR RECEIVED BY A HEALTH -CARE PROVIDER,1
PHARMACY, HEALTH BENEFIT PLAN , EMPLOYER, OR HEALTH-CARE2
CLEARINGHOUSE; AND3
(b) R
ELATES TO THE PAST, PRESENT, OR FUTURE PHYSICAL OR4
MENTAL HEALTH OR CONDITION OF AN INDIVIDUAL , THE PROVISION OF5
HEALTH CARE TO AN INDIVIDUAL , OR THE PAST, PRESENT, OR FUTURE6
PAYMENT FOR THE PROVISION OF HEALTH CARE TO AN INDIVIDUAL .7
(7) "M
ANUFACTURER" HAS THE MEANING SET FORTH IN SECTION8
12-280-103
(27).9
(8) "P
ACKAGE" HAS THE MEANING SET FORTH IN 21 U.S.C. SEC.10
360eee (11)(A).11
(9) "P
HARMACY" HAS THE MEANING SET FORTH IN SECTION12
12-280-103
(43).13
(10) "R
EPACKAGER" HAS THE MEANING SET FORTH IN SECTION14
12-280-103
(46).15
(11) "T
HIRD-PARTY LOGISTICS PROVIDER" HAS THE MEANING SET16
FORTH IN SECTION 12-280-103 (52.5).17
(12) "W
HOLESALER" HAS THE MEANING SET FORTH IN SECTION18
12-280-103
(55).19
6-29-104. Applicability. T
HIS ARTICLE 29 APPLIES TO A20
MANUFACTURER, WHOLESALER, THIRD-PARTY LOGISTICS PROVIDER, OR21
REPACKAGER OF A MANUFACTURER 'S DRUGS DOING BUSINESS IN THIS22
STATE AND ENGAGED IN THE PRODUCTION , MANUFACTURE, DISTRIBUTION,23
OR SALE OF A 340B DRUG IN THIS STATE.24
6-29-105. Acquisition of 340B drugs - prohibited acts -25
enforcement - penalties - nonpreemption - data exclusions.26
(1) Prohibited acts. O
N AND AFTER THE EFFECTIVE DATE OF THIS27
SB25-071
-7- ARTICLE 29:1
(a) U
NLESS THE RECEIPT OF THE 340B DRUGS IS PROHIBITED BY2
THE FEDERAL DEPARTMENT OF HEALTH AND HUMAN SERVICES , A3
MANUFACTURER, WHOLESALER, THIRD-PARTY LOGISTICS PROVIDER, OR4
REPACKAGER, OR AN AGENT , CONTRACTOR, OR AFFILIATE OF A5
MANUFACTURER, WHOLESALER, THIRD-PARTY LOGISTICS PROVIDER, OR6
REPACKAGER, INCLUDING AN ENTITY THAT COLLECTS OR PROCESSES7
HEALTH INFORMATION, SHALL NOT, DIRECTLY OR INDIRECTLY, DENY,8
RESTRICT, PROHIBIT, DISCRIMINATE AGAINST, OR OTHERWISE LIMIT THE9
ACQUISITION OF A 340B DRUG BY, OR DELIVERY OF A 340B DRUG TO, A10
340B
COVERED ENTITY, A PHARMACY CONTRACTED WITH A 340B11
COVERED ENTITY, OR A LOCATION OTHERWISE AUTHORIZED BY A 340B12
COVERED ENTITY TO RECEIVE AND DISPENSE 340B DRUGS; AND13
(b) A
MANUFACTURER SHALL NOT DIRECTLY OR INDIRECTLY14
REQUIRE, INCLUDING AS A CONDITION , A 340B COVERED ENTITY, A15
PHARMACY CONTRACTED WITH A 340B COVERED ENTITY, OR ANY OTHER16
LOCATION AUTHORIZED TO RECEIVE 340B DRUGS BY A 340B COVERED17
ENTITY TO SUBMIT ANY HEALTH INFORMATION , CLAIMS OR UTILIZATION18
DATA, PURCHASING DATA, PAYMENT DATA, OR OTHER DATA THAT DOES19
NOT RELATE TO A CLAIM SUBMITTED TO A FEDERAL HEALTH CARE20
PROGRAM, UNLESS SUCH DATA IS VOLUNTARILY FURNISHED BY SUCH21
COVERED ENTITY OR OTHERWISE REQUIRED TO BE FURNISHED UNDER22
APPLICABLE FEDERAL LAW.23
(2) Enforcement - penalties. (a) T
HE ATTORNEY GENERAL MAY24
INVESTIGATE A COMPLAINT CONCERNING A VIOLATION OF THIS ARTICLE25
29.
A PERSON THAT VIOLATES THIS ARTICLE 29 ENGAGES IN AN UNFAIR OR26
DECEPTIVE TRADE PRACTICE PURSUANT TO SECTION 6-1-105 (1)(iiii) AND27
SB25-071
-8- IS SUBJECT TO THE ENFORCEMENT PROVISIONS , CIVIL PENALTIES, AND1
DAMAGES SET FORTH IN ARTICLE 1 OF THIS TITLE 6.2
(b) E
ACH PACKAGE OF A 340B DRUG THAT CONSTITUTES A3
PROHIBITED ACT UNDER THIS ARTICLE 29 CONSTITUTES A SEPARATE4
VIOLATION OF SUBSECTION (1) OF THIS SECTION.5
(c) L
IMITED DISTRIBUTION OF A DRUG REQUIRED UNDER 21 U.S.C.6
SEC. 355-1 DOES NOT CONSTITUTE A VIOLATION OF THIS ARTICLE 29.7
(d) A
PERSON REGULATED BY THE STATE BOARD OF PHARMACY8
CREATED IN SECTION 12-280-104 MAY BE SUBJECT TO DISCIPLINE9
PURSUANT TO SECTION 12-280-108 (1)(c), (1)(d), OR (1)(i) FOR VIOLATING10
THIS ARTICLE 29.11
(3) Nonpreemption. N
OTHING IN THIS ARTICLE 29 SHALL BE12
CONSTRUED OR APPLIED TO BE LESS RESTRICTIVE THAN ANY FEDERAL LAW13
APPLYING TO PERSONS REGULATED BY THIS SECTION . NOTHING IN THIS14
SECTION SHALL BE CONSTRUED OR APPLIED TO BE IN CONFLICT WITH ANY15
OF THE FOLLOWING:16
(a) A
PPLICABLE FEDERAL LAW AND RELATED REGULATIONS ; OR17
(b) O
THER LAWS OF THIS STATE, IF THE LAWS ARE COMPATIBLE18
WITH APPLICABLE FEDERAL LAW .19
(4) Data exclusions. S
UBSECTION (1) OF THIS SECTION DOES NOT20
PROHIBIT A MANUFACTURER FROM REQUIRING HEALTH INFORMATION OR21
OTHER DATA THAT A COVERED ENTITY IS REQUIRED TO FURNISH TO THE22
MANUFACTURER UNDER APPLICABLE FEDERAL LAW , INCLUDING DATA23
RELATING TO AN AUDIT IN ACCORDANCE WITH PROCEDURES ESTABLISHED24
BY THE FEDERAL DEPARTMENT OF HEALTH AND HUMAN SERVICES UNDER25
42
U.S.C. SEC. 256b (a)(5)(C).26
SECTION 3. In Colorado Revised Statutes, add 25-3-132 as27
SB25-071
-9- follows:1
25-3-132. 340B drug pricing program transparency -2
definitions. (1) A
S USED IN THIS SECTION:3
(a) "340B
DRUG PRICING PROGRAM" OR "340B PROGRAM" MEANS4
THE PROGRAM DESCRIBED IN 42 U.S.C. SEC. 256b (a)(1).5
(b) "H
OSPITAL COVERED ENTITY" MEANS A HOSPITAL LICENSED OR6
CERTIFIED BY THE DEPARTMENT PURSUANT TO THE DEPARTMENT 'S7
AUTHORITY UNDER SECTION 25-1.5-103 (1)(a) AND THAT IS A "COVERED8
ENTITY" AS DEFINED IN 42 U.S.C. SEC. 256b (a)(4).9
(2) E
XCEPT AS PROVIDED IN SUBSECTION (3) OF THIS SECTION,10
EACH HOSPITAL COVERED ENTITY SHALL ANNUALLY POST THE FOLLOWING11
INFORMATION ON ITS PUBLIC-FACING WEBSITE:12
(a) T
HE ANNUAL, ESTIMATED, AGGREGATE FINANCIAL BENEFIT TO13
THE HOSPITAL COVERED ENTITY RESULTING FROM ITS ABILITY TO ACQUIRE14
PHARMACEUTICALS AT A DISCOUNT THROUGH THE 340B DRUG PRICING15
PROGRAM, USING A STANDARDIZED METHODOLOGY DEVELOPED AND16
PUBLISHED PUBLICLY BY A STATEWIDE ASSOCIATION OF HOSPITALS ; AND17
(b) A
DESCRIPTION OF HOW THE HOSPITAL COVERED ENTITY USES18
SAVINGS FROM PARTICIPATION IN THE 340B PROGRAM.19
(3) N
OTHING IN THIS SECTION REQUIRES THE PUBLIC DISCLOSURE20
OF RECORDS THAT ARE PUBLIC RECORDS UNDER THE "COLORADO OPEN21
R
ECORDS ACT", PART 2 OF ARTICLE 72 OF TITLE 24, BUT THAT ARE22
EXEMPTED FROM DISCLOSURE UNDER THAT ACT .23
SECTION 4. Severability. If any provision of this act or the24
application thereof to any person or circumstance is held invalid, such25
invalidity does not affect other provisions or applications of the act that26
can be given effect without the invalid provision or application, and to27
SB25-071
-10- this end the provisions of this act are declared to be severable.1
SECTION 5. Act subject to petition - effective date. This act2
takes effect at 12:01 a.m. on the day following the expiration of the3
ninety-day period after final adjournment of the general assembly; except4
that, if a referendum petition is filed pursuant to section 1 (3) of article V5
of the state constitution against this act or an item, section, or part of this6
act within such period, then the act, item, section, or part will not take7
effect unless approved by the people at the general election to be held in8
November 2026 and, in such case, will take effect on the date of the9
official declaration of the vote thereon by the governor.10
SB25-071
-11-