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Yahoo
a day ago
- Business
- Yahoo
Pharmaceutical company AstraZeneca sues Utah Attorney General over discount medication law
SALT LAKE CITY () — The pharmaceutical company AstraZeneca has filed a federal lawsuit against Utah Attorney General Derek Brown and Utah Insurance Commissioner Jon Pike over a recent law that is intended to allow more pharmacies to have access to drug discount programs. In a lawsuit filed May 23, AstraZeneca alleges that Utah SB 69 is unconstitutional. The law was introduced and passed in the 2025 General Assembly, and it went into effect on May 7. The law prohibits drug manufacturers from restricting pharmacies from working with 340B entities, which help pharmacies and patients access medications at a discounted price. Senator Lee responds to the Trump-Musk feud The 340B Drug Pricing Program is a that 'enables covered entities to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services,' according to the Health Resources and Services Administration (HRSA) website. It means that drug manufacturers participating in Medicaid agree to provide 'outpatient drugs to covered entities at significantly reduced prices.' All organizations need to be registered and enrolled in the 340B program in order to purchase discounted medications. The law that established the 340B Program, Section 340B(a)(4) of the Public Health Service Act, specified certain types of for the program, such as medical centers that serve rural and other underserved communities and clinics that specialize in particular diseases like HIV/AIDS. SB 69 expands the scope, requiring drug manufacturers to provide the discounts to third-party pharmacies that are contracting with 340B entities, and this is what AstraZeneca is claiming is unconstitutional in its lawsuit. Utah House Republicans elect new leadership members The lawsuit states that because price controls 'disincentivize innovation and destabilize markets,' Congress chose to specifically limit the types of organizations that are eligible in Section 340B. The suit notes that for-profit pharmacies like Walgreens or CVS were not included as eligible, and there have already been several federal court cases ruling that block efforts to require drug manufacturers to provide discounts to contracted pharmacies. AstraZeneca claims in its suit that SB 69 'requires pharmaceutical manufacturers to offer 340B-discounted pricing for sales at an unlimited number of contract pharmacies,' expanding 340B discounts to 'an entirely new category of transactions not covered by Section 340B itself.' The suit alleges that SB 69 directly conflicts with federal law requirements, and therefore, it cannot be enforced against Astrazeneca or other drug manufacturers. AstraZeneca is asking the court to declare SB 69 unconstitutional and to order that Utah AG Derek Brown and Insurance Commissioner Jon Pike not enforce the law against AstraZeneca. Musk floats 'The American Party' after Trump tiff Myths VS Facts: What health officials want you to know about the MMR vaccine Good4Utah Road Tour: Willard Bay State Park Lori Vallow Daybell back in court, charged with conspiracy to murder ex nephew-in-law Man charged with assault for allegedly attacking and strangling neighbor Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
2 days ago
- Business
- Yahoo
AstraZeneca sues Utah attorney general over new drug pricing law
AstraZeneca, a major pharmaceutical company, has sued Utah's Attorney General Derek Brown over a recently passed state law allowing for lower pricing in pharmacies. The lawsuit concerns how SB69, passed during the 2025 state legislative session, deals with Section 340B of the federal Public Health Service Act. The suit was filed in May in the U.S. District Court of the District of Utah. The lawsuit argues that SB69 violates federal law by expanding the 340B drug discount program to unlimited pharmacies. The 340B drug discount program is designed to provide pricing benefits to specific eligible health care entities. It requires pharmaceutical manufacturers to offer products at steeply discounted rates for a specific list of entities. 'Because such price controls can disincentivize innovation and destabilize markets, Congress carefully crafted Section 340B and limited participation in the program to fifteen — and only fifteen — types of covered entities," per the lawsuit. It also points out that for-profit pharmacy chains, such as CVS and Walgreens, were not included in the list of covered entities. AstraZeneca's suit seeks for an order declaring that SB69 violates federal law and is unconstitutional. It also seeks to stop Brown and Utah Insurance Commissioner Jon Pike from enforcing SB69 against AstraZeneca in any manner. The Utah Attorney General's Office said Friday it had no comment on the lawsuit. SB69, which was sponsored by Sen. Evan Vickers, R-Cedar City, defines terms related to the 340B drug discount program and prohibits pharmaceutical manufacturers from setting certain restrictions. Under the law, manufacturers cannot prohibit or restrict pharmacies from contracting with 340B entities. They also cannot deny these 340B entities access to specific drugs. 'Apparently dissatisfied with the scope of federal law, the State of Utah has enacted a statute seeking to achieve under state law precisely the same result that federal courts have resoundingly rejected,' per the suit. 'The state law requires pharmaceutical manufacturers to offer 340B-discounted pricing for sales at an unlimited number of contract pharmacies.' The suit says that SB69 extends Section 340B price caps beyond the scope of the federal program, requiring manufacturers to make discounted drugs available for sale at any and all pharmacies 'authorized by a 340B entity to receive the drug.' It alleges that the law extends the discounts to new categories of transactions that are not covered by the program, thus conflicting with federal law requirements. The suit argues that the law conflicts with federal law, specifically court rulings that 'make clear that the federal 340B statute does not obligate manufacturers to deliver discounted drugs to unlimited contract pharmacies." According to the suit, SB69 also violates federal patent law, which 'prohibits states from regulating the price of patented goods.' 'It requires manufacturers like AstraZeneca to offer steeply discounted prices for the sale of their patented drugs, thereby extending federal price caps to an additional category of patented drug sales (contract pharmacy sales) that federal courts have held fall outside of the 340B program. It also argues that SB69 violates the Contracts Clause of the U.S. Constitution and the Constitution's takings clause.
