(1)The general assembly finds and
determines that:
(a)The 340B drug pricing program requires drug manufacturers to provide
drug discounts on identified outpatient drugs to 340B covered entities as a
condition of medicaid and medicare part B covering those drugs;
(b)Congress created the 340B program in 1992, stating that the program's
benefits enable [covered] entities to stretch scarce Federal resources as far as
possible, reaching more eligible patients and providing more comprehensive
services. (H.R. Rep. No.102-384 (II), at 12 (1992)).
(c)The 340B program supports Colorado's medically vulnerable and
underserved populations by providing additional resources to 340B covered entities
and allowing these entities to determine the most effective use of these resources;
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(1) The general assembly finds and
determines that:
(a) The 340B drug pricing program requires drug manufacturers to provide
drug discounts on identified outpatient drugs to 340B covered entities as a
condition of medicaid and medicare part B covering those drugs;
(b) Congress created the 340B program in 1992, stating that the program's
benefits enable [covered] entities to stretch scarce Federal resources as far as
possible, reaching more eligible patients and providing more comprehensive
services. (H.R. Rep. No.102-384 (II), at 12 (1992)).
(c) The 340B program supports Colorado's medically vulnerable and
underserved populations by providing additional resources to 340B covered entities
and allowing these entities to determine the most effective use of these resources;
(d) The 340B program is a critical component of Colorado's safety net
infrastructure;
(e) Colorado has sixty-eight hospitals statewide that participate in the 340B
program, with nearly ninety percent of these hospitals operating under
unsustainable long-term margins;
(f) Additionally, Colorado has twenty federally qualified health centers, or
FQHCs, all of which participate in the 340B program and sixty-five percent of which
currently operate with negative margins;
(g) Colorado hospitals participating in the 340B program utilize program
benefits to address their communities' unique needs, which include providing direct
prescription drug discounts, subsidizing uncompensated charity care and medicaid
underpayments to remain financially operational, supporting opioid use disorder
treatment, funding mobile health-care and immunization clinics, and paying for
chemotherapy and infusion centers;
(h) Colorado's FQHCs are the primary care medical home for one in seven
Coloradans, with eighty-nine percent of FQHCs' patients in 2023 living with family
incomes below two hundred percent of the federal poverty guideline and twenty-three percent uninsured;
(i) Colorado's FQHCs utilize 340B program benefits to address their
communities' unique needs, which include reduced drug prices for patients,
provider recruitment and retention, and expansion of oral health and behavioral
health services that the FQHCs would otherwise not be able to offer;
(j) Further, Colorado's FQHCs experienced an estimated loss of four million
three hundred dollars in 340B program savings in the last two years;
(k) Conversely, in 2023, sixteen of the largest pharmaceutical companies
reported six hundred eighty-four billion dollars in earnings in their annual financial
reports, a figure that was higher than the gross domestic product of eighty-eight
percent of the countries in the world;
(l) In addition, the eight largest pharmaceutical companies paid a combined
two billion dollars in federal taxes on two hundred fourteen billion dollars of
domestic revenue in 2022, according to their 10-K annual financial reports;
(m) In 2022, Colorado hospitals provided two billion one hundred million
dollars of community benefit;
(n) Starting in 2020, pharmaceutical manufacturers began to unlawfully
place restrictions on 340B covered entities using contract pharmacies to dispense
drugs to patients, unilaterally limiting the 340B program's benefits; and
(o) In a letter dated July 28, 2023, from William Tong, attorney general of
Connecticut, to the United States senate 340B working group, and signed by
twenty-two other bipartisan attorneys general, the attorneys general declared that
outpatient pharmacies are a key mechanism for the delivery of life-saving drugs to
eligible patients, including those who have limited access to transportation, live in
remote or rural areas, or are confined to their homes and rely on mail-order
pharmacies.
(2) Therefore, the general assembly declares that this article 29 prohibiting
pharmaceutical manufacturers from imposing limitations or placing restrictive
conditions on 340B covered entities is necessary to protect Colorado's vulnerable
patients and safety net providers and to ensure that much-needed financial
resources generated by the 340B program remain in Colorado for the benefit of the
public.