MD
Maryland House Bill HB1056

Maryland 2024 Regular Session

Maryland House Bill HB1056 Compare Versions

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1- WES MOORE, Governor Ch. 962
21
3-– 1 –
4-Chapter 962
5-(House Bill 1056)
62
7-AN ACT concerning
3+EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4+ [Brackets] indicate matter deleted from existing law.
5+ Underlining indicates amendments to bill.
6+ Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7+amendment.
8+ *hb1056*
89
9-State Board of Pharmacy – Prohibition on Discrimination Against 340B Drug
10-Distribution
10+HOUSE BILL 1056
11+J2, J5 4lr2443
12+ CF SB 986
13+By: Delegates Guzzone, Bagnall, Hill, Kaiser, R. Lewis, White Holland, and Woods
14+Woods, Alston, Bhandari, Chisholm, Cullison, Hutchinson, S. Johnson,
15+Kerr, Kipke, Lopez, Martinez, M. Morgan, Pena–Melnyk, Reilly, Rosenberg,
16+Szeliga, and Taveras
17+Introduced and read first time: February 7, 2024
18+Assigned to: Health and Government Operations
19+Committee Report: Favorable with amendments
20+House action: Adopted
21+Read second time: March 7, 2024
1122
12-FOR the purpose of prohibiting a 340B manufacturer, wholesale drug distributor, or
13-third–party logistics provider, or an agent or affiliate of a 340B manufacturer,
14-wholesale drug distributor, or third–party logistics provider, from taking certain
15-direct or indirect actions to limit or restrict the acquisition or delivery of a 340B drug;
16-making a violation of this Act an unfair, abusive, or deceptive trade practice within
17-the meaning of the Consumer Protection Act; requiring the Maryland Prescription
18-Drug Affordability Board to conduct a study of the 340B Program; and generally
19-relating to 340B drugs.
23+CHAPTER ______
2024
21-BY repealing and reenacting, with amendments,
22- Article – Commercial Law
23-Section 13–301(14)(xl)
24- Annotated Code of Maryland
25- (2013 Replacement Volume and 2023 Supplement)
25+AN ACT concerning 1
2626
27-BY repealing and reenacting, without amendments,
28- Article – Commercial Law
29-Section 13–301(14)(xli)
30- Annotated Code of Maryland
31- (2013 Replacement Volume and 2023 Supplement)
27+State Board of Pharmacy – Prohibition on Discrimination Against 340B Drug 2
28+Distribution 3
3229
33-BY adding to
34- Article – Commercial Law
35-Section 13–301(14)(xlii)
36- Annotated Code of Maryland
37- (2013 Replacement Volume and 2023 Supplement)
30+FOR the purpose of prohibiting a 340B manufacturer, wholesale drug distributor, or 4
31+third–party logistics provider, or an agent or affiliate of a 340B manufacturer, 5
32+wholesale drug distributor, or third–party logistics provider, from taking certain 6
33+direct or indirect actions to limit or restrict the acquisition or delivery of a 340B drug; 7
34+making a violation of this Act an unfair, abusive, or deceptive trade practice within 8
35+the meaning of the Consumer Protection Act; requiring the Maryland Prescription 9
36+Drug Affordability Board to conduct a study of the 340B Program; and generally 10
37+relating to 340B drugs. 11
3838
39-BY repealing and reenacting, without amendments,
40- Article – Health Occupations
41-Section 12–101(a) and (d)
42- Annotated Code of Maryland
43- (2021 Replacement Volume and 2023 Supplement)
39+BY repealing and reenacting, with amendments, 12
40+ Article – Commercial Law 13
41+Section 13–301(14)(xl) 14
42+ Annotated Code of Maryland 15
43+ (2013 Replacement Volume and 2023 Supplement) 16
4444
45-BY adding to
46- Article – Health Occupations
47-Section 12–6C–09.1
48- Annotated Code of Maryland
49- (2021 Replacement Volume and 2023 Supplement) Ch. 962 2024 LAWS OF MARYLAND
45+BY repealing and reenacting, without amendments, 17
46+ Article – Commercial Law 18
47+Section 13–301(14)(xli) 19
48+ Annotated Code of Maryland 20 2 HOUSE BILL 1056
5049
51-– 2 –
5250
53- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
54-That the Laws of Maryland read as follows:
51+ (2013 Replacement Volume and 2023 Supplement) 1
5552
56-Article – Commercial Law
53+BY adding to 2
54+ Article – Commercial Law 3
55+Section 13–301(14)(xlii) 4
56+ Annotated Code of Maryland 5
57+ (2013 Replacement Volume and 2023 Supplement) 6
5758
58-13–301.
59+BY repealing and reenacting, without amendments, 7
60+ Article – Health Occupations 8
61+Section 12–101(a) and (d) 9
62+ Annotated Code of Maryland 10
63+ (2021 Replacement Volume and 2023 Supplement) 11
5964
60- Unfair, abusive, or deceptive trade practices include any:
65+BY adding to 12
66+ Article – Health Occupations 13
67+Section 12–6C–09.1 14
68+ Annotated Code of Maryland 15
69+ (2021 Replacement Volume and 2023 Supplement) 16
6170
62- (14) Violation of a provision of:
71+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 17
72+That the Laws of Maryland read as follows: 18
6373
64- (xl) Title 14, Subtitle 13 of the Public Safety Article; [or]
74+Article – Commercial Law 19
6575
66- (xli) Title 14, Subtitle 45 of this article; or
76+13–301. 20
6777
68- (XLII) SECTION 12–6C–09.1 OF THE HEALTH OCCUPATIONS
69-ARTICLE; OR
78+ Unfair, abusive, or deceptive trade practices include any: 21
7079
71-Article – Health Occupations
80+ (14) Violation of a provision of: 22
7281
73-12–101.
82+ (xl) Title 14, Subtitle 13 of the Public Safety Article; [or] 23
7483
75- (a) In this title the following words have the meanings indicated.
84+ (xli) Title 14, Subtitle 45 of this article; or 24
7685
77- (d) “Board” means the State Board of Pharmacy.
86+ (XLII) SECTION 12–6C–09.1 OF THE HEALTH OCCUPATIONS 25
87+ARTICLE; OR 26
7888
79-12–6C–09.1.
89+Article – Health Occupations 27
8090
81- (A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS
82-INDICATED.
91+12–101. 28
8392
84- (2) “COVERED ENTITY ” HAS THE MEANING STAT ED IN 42 U.S.C. §
85-256B(A)(4).
93+ (a) In this title the following words have the meanings indicated. 29
8694
87- (3) “PACKAGE” HAS THE MEANING STAT ED IN 21 U.S.C. §
88-360EEE(11).
95+ (d) “Board” means the State Board of Pharmacy. 30
8996
90- (4) (I) “340B DRUG” MEANS A DRUG THAT :
97+12–6C–09.1. 31 HOUSE BILL 1056 3
9198
92- 1. IS A COVERED OUTPATIE NT DRUG UNDER 42 U.S.C. §
93-256B;
9499
95- 2. HAS BEEN SUBJECT TO A N OFFER FOR REDUCED
96-PRICES BY A 340B MANUFACTURER UNDER 42 U.S.C. § 256B(A)(1); AND WES MOORE, Governor Ch. 962
97100
98-– 3 –
101+ (A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE ME ANINGS 1
102+INDICATED. 2
99103
100- 3. IS PURCHASED BY A COV ERED ENTITY.
104+ (2) “COVERED ENTITY ” HAS THE MEANING STAT ED IN 42 U.S.C. § 3
105+256B(A)(4). 4
101106
102- (II) “340B DRUG” INCLUDES A DRUG THAT WOULD HAVE BEEN
103-PURCHASED BUT FOR TH E LIMITATION UNDER S UBSECTION (D) (C) OF THIS
104-SECTION.
107+ (3) “PACKAGE” HAS THE MEANING STAT ED IN 21 U.S.C. § 5
108+360EEE(11). 6
105109
106- (5) “340B MANUFACTURER ” MEANS A MANUFACTURER , AS DEFINED
107-IN 42 U.S.C. § 1396R–8(K)(5), OF COVERED OUTPATIEN T DRUGS THAT HAS SIG NED
108-A PHARMACEUTICAL PRI CING AGREEMENT UNDER 42 U.S.C. § 256B(A)(1).
110+ (4) (I) “340B DRUG” MEANS A DRUG THAT : 7
109111
110- (B) THIS SECTION APPLIES TO:
112+ 1. IS A COVERED OUTPATIE NT DRUG UNDER 42 U.S.C. § 8
113+256B; 9
111114
112- (1) A 340B MANUFACTURER ;
115+ 2. HAS BEEN SUBJECT TO A N OFFER FOR REDUCED 10
116+PRICES BY A 340B MANUFACTURER UNDER 42 U.S.C. § 256B(A)(1); AND 11
113117
114- (2) A WHOLESALE DRUG DISTR IBUTOR;
118+ 3. IS PURCHASED BY A COV ERED ENTITY. 12
115119
116- (3) A THIRD–PARTY LOGISTICS PROV IDER; AND
120+ (II) “340B DRUG” INCLUDES A DRUG THAT WOULD HAVE BEEN 13
121+PURCHASED BUT FOR THE LIMITATION U NDER SUBSECTION (D) (C) OF THIS 14
122+SECTION. 15
117123
118- (4) AN AGENT OR AFFILIATE OF A 340B MANUFACTURER ,
119-WHOLESALE DRUG DISTR IBUTOR, OR THIRD–PARTY LOGISTICS PROV IDER.
124+ (5) “340B MANUFACTURER ” MEANS A MANUFACTURER , AS DEFINED 16
125+IN 42 U.S.C. § 1396R–8(K)(5), OF COVERED OUTPATIEN T DRUGS THAT HAS SIG NED 17
126+A PHARMACEUTICAL PRI CING AGREEMENT UNDER 42 U.S.C. § 256B(A)(1). 18
120127
121- (C) THIS SECTION MAY NOT BE CONSTRUED TO BE :
128+ (B) THIS SECTION APPLIES TO: 19
122129
123- (1) LESS RESTRICTIVE THAN ANY FEDERAL LAW THAT IS APPLICABLE
124-TO A PERSON REGULATE D BY THIS SECTION; OR
130+ (1) A 340B MANUFACTURER ; 20
125131
126- (2) IN CONFLICT WITH APPL ICABLE FEDERAL AND STATE LAWS AND
127-REGULATIONS .
132+ (2) A WHOLESALE DRUG DISTR IBUTOR; 21
128133
129- (D) (C) (1) EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS
130-SUBSECTION, AN ENTITY SUBJECT TO THIS SECTION A 340B MANUFACTURER MAY
131-NOT DIRECTLY OR INDI RECTLY DENY , RESTRICT, PROHIBIT, DISCRIMINATE
132-AGAINST, OR OTHERWISE LIMIT T HE ACQUISITION OF A 340B DRUG BY, OR
133-DELIVERY OF A 340B DRUG TO, A PHARMACY THAT IS U NDER CONTRACT WITH O R
134-OTHERWISE AUT HORIZED BY A COVERED ENTITY TO RECEIVE 340B DRUGS ON
135-BEHALF OF THE COVERE D ENTITY UNLESS THE RECEIPT OF 340B DRUGS IS
136-PROHIBITED BY THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES.
134+ (3) A THIRD–PARTY LOGISTICS PROV IDER; AND 22
137135
138- (2) AN ENTITY SUBJECT TO THIS SECTION A 340B MANUFACTURER
139-MAY LIMIT TH E DISTRIBUTION OF A 340B DRUG IF THE LIMITATI ON IS REQUIRED
140-UNDER 21 U.S.C. § 355–1.
141- Ch. 962 2024 LAWS OF MARYLAND
136+ (4) AN AGENT OR AFFILIATE OF A 340B MANUFACTURER , 23
137+WHOLESALE DRUG DISTR IBUTOR, OR THIRD–PARTY LOGISTICS PROV IDER. 24
142138
143-– 4 –
144- (E) (D) (1) (I) A VIOLATION OF SUBSECT ION (D) (C) OF THIS
145-SECTION:
139+ (C) THIS SECTION MAY NOT BE CONSTRUED TO BE : 25
146140
147- (I) 1. SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , IS
148-AN UNFAIR, ABUSIVE, OR DECEPTIVE TRADE PRACTICE WITHIN THE MEANING OF
149-TITLE 13 OF THE COMMERCIAL LAW ARTICLE AND IS SUBJEC T TO THE
150-ENFORCEMENT AND PENA LTY PROVISIONS CONTA INED IN TITLE 13 OF THE
151-COMMERCIAL LAW ARTICLE; AND
141+ (1) LESS RESTRICTIVE THAN ANY FEDERAL LAW THAT IS APPLICABLE 26
142+TO A PERSON REGULATE D BY THIS SECTION; OR 27
143+ 4 HOUSE BILL 1056
152144
153- (II) 2. A. SHALL IF THE ALLEGED VIOLAT ION WAS
154-COMMITTED BY A PERSO N THAT IS LICENSED OR PERMITTED BY THE BOARD, SHALL
155-BE JOINTLY OR SEPARATEL Y INVESTIGATED BY THE BOARD OR THE CONSUMER
156-PROTECTION DIVISION OF THE OFFICE OF THE ATTORNEY GENERAL; OR
157145
158- B. IF THE ALLEGED VIOLAT ION WAS COMMITTED BY A
159-PERSON THAT IS NOT L ICENSED OR PERMITTED BY T HE BOARD, SHALL BE
160-INVESTIGATED BY THE CONSUMER PROTECTION DIVISION OF THE OFFICE OF THE
161-ATTORNEY GENERAL.
146+ (2) IN CONFLICT WITH APPL ICABLE FEDERAL AND STATE LAWS AND 1
147+REGULATIONS . 2
162148
163- (II) AS PART OF AN INVESTI GATION CONDUCTED UND ER
164-SUBPARAGRAPH (1)(I)2 OF THIS PARAGRAPH , THE BOARD OR THE CONSUMER
165-PROTECTION DIVISION OF THE OFFICE OF THE ATTORNEY GENERAL MAY
166-INVESTIGATE AN AFFIL IATE OR A CONTRACTOR OF THE 340B MANUFACTURER ,
167-INCLUDING A WHOLESAL ER OR THIRD–PARTY LOGISTICS PROV IDER.
149+ (D) (C) (1) EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS 3
150+SUBSECTION, AN ENTITY SUBJECT TO THIS SECTION A 340B MANUFACTURER MAY 4
151+NOT DIRECTLY OR INDI RECTLY DENY , RESTRICT, PROHIBIT, DISCRIMINATE 5
152+AGAINST, OR OTHERWISE LIMIT T HE ACQUISITION OF A 340B DRUG BY, OR 6
153+DELIVERY OF A 340B DRUG TO, A PHARMACY THAT IS U NDER CONTRACT WITH O R 7
154+OTHERWISE AUTHORIZED BY A COVE RED ENTITY TO RECEIV E 340B DRUGS ON 8
155+BEHALF OF THE COVERE D ENTITY UNLESS THE RECEIPT OF 340B DRUGS IS 9
156+PROHIBITED BY THE U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES. 10
168157
169- (2) (I) IN ADDITION TO THE PE NALTIES UNDER TITLE 13 OF THE
170-COMMERCIAL LAW ARTICLE, A CIVIL FINE MAY BE ASSESSED IN THE AMOU NT OF
171-$50,000 $5,000 PER VIOLATION OF SUB SECTION (D) (C) OF THIS SECTION.
158+ (2) AN ENTITY SUBJECT TO THIS SECTION A 340B MANUFACTURER 11
159+MAY LIMIT THE DISTRIBUTION OF A 340B DRUG IF THE LIMITATI ON IS REQUIRED 12
160+UNDER 21 U.S.C. § 355–1. 13
172161
173- (II) A VIOLATION OF THIS SE CTION DOES NOT CREAT E A
174-PRIVATE RIGHT OF ACT ION UNDER § 13–408 OF THE COMMERCIAL LAW ARTICLE.
162+ (E) (D) (1) (I) A VIOLATION OF SUBSECT ION (D) (C) OF THIS 14
163+SECTION: 15
175164
176- (3) IF A VIOLATION OF SUB SECTION (D) (C) OF THIS SECTION IS
177-COMMITTED BY A PERSO N LICENSED OR PERMIT TED BY THE BOARD, THE BOARD
178-MAY IMPOSE DISCIPLIN E, SUSPENSION, OR REVOCATION OF THE PERSON’S LICENSE
179-OR PERMIT.
165+ (I) 1. SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , IS 16
166+AN UNFAIR, ABUSIVE, OR DECEPTIVE TRADE PRACTICE WITHIN THE MEANING OF 17
167+TITLE 13 OF THE COMMERCIAL LAW ARTICLE AND IS SUBJEC T TO THE 18
168+ENFORCEMENT AND PENA LTY PROVISIONS CONTA INED IN TITLE 13 OF THE 19
169+COMMERCIAL LAW ARTICLE; AND 20
180170
181- (4) EACH PACKAGE OF 340B DRUGS SUBJECT TO A V IOLATION OF
182-SUBSECTION (D) (C) OF THIS SECTION SHAL L CONSTITUTE A SEPAR ATE VIOLATION.
171+ (II) 2. A. SHALL IF THE ALLEGED VIOLAT ION WAS 21
172+COMMITTED BY A PERSO N THAT IS LICENSED OR PERMITTED BY THE BOARD, SHALL 22
173+BE JOINTLY OR SEPARATEL Y INVESTIGATED BY THE BOARD OR THE CONSUMER 23
174+PROTECTION DIVISION OF THE OFFICE OF THE ATTORNEY GENERAL; OR 24
183175
184- SECTION 2. AND BE IT FURTHER ENACTED, That:
185- WES MOORE, Governor Ch. 962
176+ B. IF THE ALLEGED VIOLAT ION WAS COMMITTED BY A 25
177+PERSON THAT IS NOT LICENSED OR PERMITTE D BY THE BOARD, SHALL BE 26
178+INVESTIGATED BY THE CONSUMER PROTECTION DIVISION OF THE OFFICE OF THE 27
179+ATTORNEY GENERAL. 28
186180
187-– 5 –
188- (a) The Maryland Prescription Drug Affordability Board, in consultation with the
189-Maryland Department of Health:
181+ (II) AS PART OF AN INVESTI GATION CONDUCTED UND ER 29
182+SUBPARAGRAPH (1)(I)2 OF THIS PARAGRAPH , THE BOARD OR THE CONSUMER 30
183+PROTECTION DIVISION OF THE OFFICE OF THE ATTORNEY GENERAL MAY 31
184+INVESTIGATE AN AFFIL IATE OR A CONTRACTOR OF THE 340B MANUFACTURER , 32
185+INCLUDING A WHOLESAL ER OR THIRD–PARTY LOGISTICS PROV IDER. 33
190186
191- (1) shall conduct a study on:
187+ (2) (I) IN ADDITION TO THE PE NALTIES UNDER TITLE 13 OF THE 34
188+COMMERCIAL LAW ARTICLE, A CIVIL FINE MAY BE ASSESSED IN THE AMOU NT OF 35
189+$50,000 $5,000 PER VIOLATION OF SUB SECTION (D) (C) OF THIS SECTION. 36 HOUSE BILL 1056 5
192190
193- (i) the current implementation and scope of the 340B Program in
194-the State;
195191
196- (ii) the implementation and impact of the implementation of Section
197-1 of this Act; and
198192
199- (iii) the finances of the Program in the State, including how covered
200-entities reinvest savings realized from the Program; and
193+ (II) A VIOLATION OF THIS SE CTION DOES NOT CREAT E A 1
194+PRIVATE RIGHT OF ACT ION UNDER § 13–408 OF THE COMMERCIAL LAW ARTICLE. 2
201195
202- (2) may require covered entities and 340B manufacturers to report
203-information as necessary to complete the study.
196+ (3) IF A VIOLATION OF SUB SECTION (D) (C) OF THIS SECTION IS 3
197+COMMITTED BY A PERSO N LICENSED OR PERMIT TED BY THE BOARD, THE BOARD 4
198+MAY IMPOSE DISCIPLIN E, SUSPENSION, OR REVOCATION OF THE PERSON’S LICENSE 5
199+OR PERMIT. 6
204200
205- (b) On or before July 1, 2026, the Maryland Prescription Drug Affordability Board
206-shall report its findings and recommendations from the study to the Senate Finance
207-Committee and the House Health and Government Operations Committee, in accordance
208-with § 2–1257 of the State Government Article.
201+ (4) EACH PACKAGE OF 340B DRUGS SUBJECT TO A VIOLATION OF 7
202+SUBSECTION (D) (C) OF THIS SECTION SHAL L CONSTITUTE A SEPAR ATE VIOLATION. 8
209203
210- SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect
211-July 1, 2024.
204+ SECTION 2. AND BE IT FURTHER ENACTED, That: 9
212205
213-Approved by the Governor, May 16, 2024.
206+ (a) The Maryland Prescription Drug Affordability Board, in consultation with the 10
207+Maryland Department of Health: 11
208+
209+ (1) shall conduct a study on: 12
210+
211+ (i) the current implementation and scope of the 340B Program in 13
212+the State; 14
213+
214+ (ii) the implementation and impact of the implementation of Section 15
215+1 of this Act; and 16
216+
217+ (iii) the finances of the Program in the State, including how covered 17
218+entities reinvest savings realized from the Program; and 18
219+
220+ (2) may require covered entities and 340B manufacturers to report 19
221+information as necessary to complete the study. 20
222+
223+ (b) On or before July 1, 2026, the Maryland Prescription Drug Affordability Board 21
224+shall report its findings and recommendations from the study to the Senate Finance 22
225+Committee and the House Health and Government Operations Committee, in accordance 23
226+with § 2–1257 of the State Government Article. 24
227+
228+ SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 25
229+July 1, 2024. 26
230+