Senate committee advances bill to protect 340B discounts for Arkansas hospitals and clinics

The Senate Insurance & Commerce Committee on voice votes approved House Bill 1881, a bill sponsors say would protect the federal 340B drug-pricing program for hospitals and certain clinics operating in underserved areas.

Representative Michelle Gray (District 62), the sponsor, told the committee HB1881 would prevent manufacturers and pharmacy benefit managers (PBMs) from reducing reimbursement or blocking hospitals and clinics that participate in 340B from partnering with local pharmacies to serve patients. "If you participate in the 340B program, that's something you signed up for federally," Gray said. "All I'm saying is once you've signed up, you can't discriminate and withhold the medication from our local pharmacies in the state."

Supporters included John Vincent of the Arkansas Pharmacists Association, who said the bill responds to practices that exclude community pharmacies from 340B arrangements. "There is not a reason for them to do that. It's unjustified," Vincent said, characterizing the conduct as profit-driven and saying the bill would prevent those actions.

Opponents, speaking for pharmaceutical manufacturers, urged the committee not to advance the bill. Leo Houser (introducing himself as representing pharmaceutical manufacturers) argued HB1881 would attempt to impose state mandates on participants in a federal program and could create a "compliance collision course" with federal law. Houser said the 340B program has grown dramatically and cited ongoing litigation, saying the question of how to reform 340B should be addressed federally rather than state by state. He warned the bill would "dictate to manufacturers how they will have to conduct business" in ways that may conflict with contract terms.

The committee's discussion focused on two areas: whether the state language duplicates or conflicts with federal law and how the bill treats mail-order pharmacies. Sponsors said the bill aligns state code with the federal 340B framework and requires an initial written consent if a patient is shifted to a mail-order provider; thereafter, no repeated consent would be necessary. Vincent and Representative Gray said that written consent would protect patients and pharmacy relationships and prevent app-based or other automatic enrollments into mail-order programs.

After closing remarks from the sponsor, Senator Ingram moved "do pass," Senator Irvin seconded, and the committee approved HB1881 by voice vote.

The committee record shows testimony on the bill and a request from opponents for caution because of ongoing multi-jurisdiction litigation. The committee did not take a roll-call vote; the chair announced the bill had passed and will proceed according to legislative process.