WLF Urges Supreme Court to Review Mississippi Law Targeting Participants in Federal 340B Program
“A State can’t reshape a federal program by imposing special burdens on the entities that help carry it out.”
—Jay DeSanto, WLF Senior Litigation Counsel
Click HERE to read WLF’s brief.
Washington, DC—Washington Legal Foundation (WLF) today urged the U.S. Supreme Court to review a Fifth Circuit decision upholding a Mississippi law that regulates drug makers participating in the federal 340B Drug Pricing Program. In its amicus brief, WLF argues that review is necessary to stop States from interfering with a federal program by imposing distinct burdens on the very participants that agree to help carry the program out.
If drug makers want their products reimbursed under Medicaid and Medicare Part B, they must participate in 340B and offer discounted drugs to qualifying providers, who often resell the drugs at a profit. Federal law allows drug makers to condition discounts on a provider’s agreement to limit the number of outside pharmacies it uses to resell the drugs. But Mississippi enacted H.B. 728, which bars such limits and effectively expands manufacturers’ 340B obligations beyond what federal law requires. The Fifth Circuit upheld the state law, reasoning that it regulates drug distribution, not drug pricing. Novartis Pharmaceuticals filed a petition seeking the Supreme Court’s review.
WLF argues that the Supremacy Clause bars States from singling out and burdening entities who help carry out a federal program. By its terms, H.B. 728 applies only to manufacturers participating in 340B, raising concerns under longstanding Supreme Court precedents that protect federal policy from state interference. The brief also warns that, absent review, H.B. 728 and similar state laws will expand the number of 340B transactions and risk billions in increased costs across other federal healthcare programs. The Supreme Court’s review is needed, WLF contends, to resolve whether States may effectively reshape a federal program through targeted regulation of its participants.