Michigan’s Legislative Action to Protect 340B Contract Pharmacies: What It Means for Healthcare Providers and Patients

The 340B Drug Pricing Program has long been a vital resource for healthcare providers serving low-income and uninsured patients. However, ongoing debates between pharmaceutical manufacturers and covered entities have led to legislative efforts to ensure continued access to the program’s benefits. Most recently, Michigan has taken a strong stance to protect 340B contract pharmacies, with the state Senate passing a key bill to prevent drug manufacturers from restricting 340B discounts.

This development is part of a broader national conversation about the role of contract pharmacies in the 340B program and the responsibilities of drug manufacturers. Let’s dive into what these legislative changes mean and how they could impact healthcare providers, covered entities, and patients.

Recent Legislative Changes: Michigan’s Senate Bill 94 & 95

On March 4, 2025, Michigan Senate Democrats reintroduced bills SB 94 and SB 95 to ensure that covered entities, such as hospitals and clinics, can continue utilizing contract pharmacies to distribute 340B-discounted medications. These bills aim to counteract pharmaceutical manufacturers' restrictions that have limited covered entities from accessing 340B pricing when using contract pharmacies.

Then, on March 6, 2025, the Michigan Senate passed SB 94 with bipartisan support, marking a significant step in protecting 340B hospitals and clinics from drug manufacturer-imposed restrictions.

The passage of this bill is critical as it:
✔ Prevents manufacturers from denying 340B discounts to covered entities that rely on contract pharmacies.
✔ Strengthens state-level oversight to ensure drug manufacturers comply with 340B program guidelines.
✔ Helps maintain patient access to affordable medications, especially for underserved communities.

This move aligns with similar efforts in other states, reflecting growing concerns over manufacturer-imposed limitations on 340B contract pharmacies.

What This Means for Healthcare Providers & Covered Entities

Hospitals, clinics, and other covered entities participating in the 340B program rely on contract pharmacies to distribute medications efficiently. However, recent restrictions from drug manufacturers have made it harder for providers to access the full benefits of the program.

With Michigan’s new legislation:
✔ 340B hospitals and clinics can continue using contract pharmacies without fear of losing manufacturer discounts.
✔ Compliance requirements may change, requiring covered entities to adapt to new state-level reporting or oversight measures.
✔ Stronger legal backing for covered entities will help prevent sudden manufacturer-imposed restrictions that disrupt patient care.

This is a win for safety-net hospitals and community health providers that depend on contract pharmacies to ensure patients receive life-saving medications at reduced costs.

How These Changes Affect Patient Access to Medications

One of the most significant concerns surrounding 340B contract pharmacy restrictions has been their impact on patients who rely on discounted medications. When manufacturers limit 340B pricing through contract pharmacies, low-income and uninsured patients face higher drug costs or reduced access to critical medications.

With Michigan’s legislative protections in place:
✔ Patients will maintain access to essential medications through contract pharmacies.
✔ Affordability improves as hospitals can continue offering reduced-price drugs to eligible patients.
✔ Community pharmacies remain a viable option for patients, especially in rural and underserved areas.

These protections help ensure that healthcare providers can continue delivering cost-effective care to those who need it most.

The Bigger Picture: National Implications

Michigan’s legislative action highlights a growing state-level response to manufacturer-imposed restrictions on 340B pricing. As other states consider similar protections, healthcare providers across the U.S. should closely monitor these developments.

Key Takeaways:

📌 Legislative trends favor covered entities in the 340B program, ensuring continued access to contract pharmacies.
📌 State-level protections may become more common as manufacturers impose more restrictions.
📌 Healthcare providers should stay informed about compliance updates and advocacy efforts to safeguard patient access.

The battle over 340B contract pharmacies is far from over, but Michigan’s recent actions show that states are willing to step in to protect healthcare providers and the patients they serve.