Legislative declaration

6-29-102. Legislative declaration. (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. Source: L. 2025: Entire article added, (SB 25-071), ch. 313, p. 1637, � 2, effective August 6.