Health Centers Move to Dismiss Challenge to Contract Pharmacy Law

Louisiana is seeking the dismissal of AstraZeneca's lawsuit against the state's contract pharmacy law.

Louisiana State Attorney General, Jeff Landry, filed a motion on December 15, requesting a summary judgment to dismiss AstraZeneca's complaint. The lawsuit challenges Louisiana Act 358, which prevents drug manufacturers from denying 340B pricing to pharmacies under contract with a 340B covered entity in the state.

AstraZeneca had previously filed a motion on November 3, seeking a summary judgment to declare Act 358 unconstitutional. The company argued that the law violates the Supremacy Clause of the U.S. Constitution by involving Louisiana officials in the management of a federally created prescription drug program.

In response, both the Louisiana Attorney General and the Louisiana Primary Care Association (LPCA) filed motions asserting that Act 358 is not preempted. They argued that the law regulates drug distribution, not pricing, and does not conflict with Section 340B, which governs pricing. The LPCA emphasized that Congress was aware of state contract pharmacy laws when enacting and amending Section 340B.

AstraZeneca v. Landry is one of three ongoing challenges to Act 358 in the same federal district court. AbbVie and the Pharmaceutical Research and Manufacturers of America (PhRMA) have also filed challenges. A spokesperson for AstraZeneca stated the company's commitment to the 340B program and compliance with contract pharmacy arrangements.

The court is expected to decide on the legality of Louisiana's law, which protects covered entities' right to dispense 340B drugs at contract pharmacies. The outcome will impact similar legal battles in other states, such as Arkansas, which has also enacted a contract pharmacy law.

Louisiana and Arkansas are the only states with laws safeguarding 340B contract pharmacies from restrictions imposed by drug manufacturers. Several manufacturers have adjusted their contract pharmacy policies in response to these state laws. At least six manufacturers have made changes in Louisiana, and seven in Arkansas.

This report first appeared in 340B Report 12/21/2023

The 340B Drug Pricing Program is managed by the Health Resources and Services Administration (HRSA) Office of Pharmacy Affairs (OPA). For more information visit: This material is provided for general informational purposes of 340B Drug Prices only and is not an endorsement of any prescription product referenced herein. For information as to the clinical use or efficacy of a referenced product, please contact the manufacturer. 340B Price Guide makes no representations and provides no warranties as to the effectiveness or suitability for use of any prescription product referenced herein. Any referenced cost is provided as an estimate only and the actual cost is subject to change at any time and without notice. 340B Price Guide does not guarantee that the cost represented herein will be the actual and pharmacy shall at all times collect amounts due as indicated at the time of adjudication and shall be reimbursed per the terms of its agreement.'