In a significant step forward for 340B-covered entities and their contract pharmacies, Louisiana has officially enacted Act 358, also known as the Defending Affordable Prescription Drug Costs Act. Signed into law during the 2023 legislative session, this bill was previously House Bill 548, puts clear limits on discriminatory practices that have increasingly interfered with the 340B program across the nation.

At its core, Act 358 prohibits drug manufacturers and distributors from denying, restricting, or interfering with the delivery of 340B drugs to contract pharmacies, a major safeguard for covered entities operating within the state.

What the Law Covers

Act 358 goes beyond just manufacturer restrictions. It includes broad protections from both payors and manufacturers, ensuring 340B entities are not disadvantaged when participating in pharmacy networks or submitting reimbursement claims. Key highlights include:

➤ Prohibiting Discriminatory Reimbursement Practices - Covered in §2883(A)(1)(g) and (e)

• Health insurance issuers, PBMs, or any third-party payors are barred from reimbursing 340B entities at lower rates than their non-340B counterparts.
• They cannot apply different fees, audit rules, or participation conditions based on a pharmacy’s 340B status.

➤ Protecting Pharmacy Network Access - Covered in §2883(A)(1)(g) and (e)

• Insurers and PBMs cannot exclude 340B entities from networks simply because they dispense 340B drugs.
• They are also prohibited from using billing modifiers or attestation requirements that single out 340B claims, unless required by CMS or Louisiana Medicaid.

➤ Blocking Manufacturer-Imposed Restrictions - Covered in §2884(A)

• Manufacturers and distributors are explicitly prohibited from interfering with the acquisition or delivery of 340B drugs to a pharmacy under contract with a covered entity.
• This includes any indirect forms of interference that may delay shipments, restrict drug access, or impose arbitrary contract terms on 340B-contracted pharmacies.

Why It Matters

Louisiana’s law is one of the strongest state-level responses yet to counter manufacturer-led contract pharmacy restrictions. While federal guidance around contract pharmacies has been inconsistent, states like Louisiana are stepping in to ensure that 340B savings continue to reach the communities they were designed to serve.

By aligning 340B protections with the state's Unfair Trade Practices and Consumer Protection Law, Act 358 gives the Louisiana Attorney General the authority to investigate and enforce violations—deterring bad actors without placing the burden on individual providers to sue.

What Covered Entities Should Know

While the law is a major win, it’s not a silver bullet. Here's what 340B entities in Louisiana should consider:

• Ensure contract pharmacy agreements are well-documented and compliant with federal HRSA guidelines.
• Monitor payer and manufacturer interactions closely and document any potential violations of Act 358.
• Engage with legal or consulting support to understand how to report violations through the appropriate state enforcement channels.

Act 358 reinforces Louisiana’s commitment to protecting access to affordable medications and ensuring that providers serving vulnerable populations are not penalized for participating in the 340B program. As other states consider similar legislation, Louisiana is setting a strong example for how state-level action can help preserve the integrity of the 340B program.

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