Last week, the Washington House continued consideration of legislation that would significantly expand hospital contract pharmacy arrangements under the federal 340B Drug Pricing Program. The House Health Care & Wellness Committee held a public hearing on the bill, largely mirroring testimony and arguments raised earlier in the Senate.
Our testimony and discussions with lawmakers again highlighted that unchecked expansion of contract pharmacies lacks transparency and accountability, diverts revenue away from employers, workers, state Medicaid programs, and local pharmacies, and disproportionately impacts small and mid-sized life science companies that do not have the financial reserves of multinational pharmaceutical firms.
Click here to watch testimony from Curtis Knapp, LSW’s Public Affairs Manager
While the committee voted Friday to advance the bill, Life Science Washington’s advocacy opposing this proposal is far from over.
Committee Adds Transparency Amendment
In response to ongoing concerns about the lack of visibility into how 340B discounts are used, the House Health Care & Wellness Committee adopted a transparency amendment before advancing the bill. Although transparency into the program is needed, it is not a tradeoff for codifying a loophole that s already under federal review for abuse, and Life Science Washington will continue engaging lawmakers as the bill moves through the legislative process.
That amendment would:
- Require covered entities to annually report:
- 340B drug acquisition costs
- Payment amounts received for 340B drugs
- Payments made to pharmacies and other entities
- How 340B savings are used
- The number of low-income patients served through a sliding fee scale for 340B drugs
- Require manufacturers to annually report:
- Certain reductions in price
- Overcharges
- Average 340B discount amounts
Tax Legislation Begins to Take Shape
Beyond health care policy, tax legislation is beginning to crystallize as lawmakers search for new revenue sources. Life Science Washington is actively opposing a proposed payroll tax, HB 2100, that would disproportionately impact early-stage and research-intensive life science companies, many of which are pre-revenue and grant-funded. The proposal is modeled after the Seattle Jump Start tax. Like Jump Start, it claims to target large companies, but would in fact, apply to companies as small as 20 employees. The industry has spent decades competing with other life science hubs to attract and expand top talent in Washington. Today, many life science companies have multiple locations. The last thing we want to do is encourage local companies to relocate their top talent elsewhere.
We will continue working with legislators to underscore the risk that new taxes pose to Washington’s innovation ecosystem, workforce growth, and long-term competitiveness.
Phthalates Bill Hearing Highlights Willingness to Adjust
The House also held a hearing this past week on HB 2402, legislation related to the regulation of phthalates. During the hearing, the bill’s sponsor acknowledged the need to adjust the compliance timeline and to include language addressing emergency situations.
The bill has not yet been scheduled for executive action, and discussions are ongoing. Life Science Washington will continue monitoring the legislation and working with AdvaMed to ensure that any regulatory changes are workable, science-based, and do not unintentionally disrupt patient care or supply chains.