Bill Summary – FastDemocracy

OHIO LEGISLATIVE SERVICE COMMISSION
                                              Office of Research                               Legislative Budget
         www.lsc.ohio.gov                       and Drafting                                         Office
                             S.B. 269                                Bill Analysis
                  135th   General Assembly
                                                                      Click here for S.B. 269’s Fiscal Note
Version: As Introduced
Primary Sponsor: Sen. Hackett
Effective date:
Jason Hoskins, Attorney
                                                          SUMMARY
                    Prohibits a manufacturer of dangerous drugs, repackager of dangerous drugs,
                          third-party logistics provider, or wholesale distributor of dangerous drugs from denying,
                          prohibiting, restricting, discriminating against, or limiting the acquisition of drugs under
                          the 340B Drug Pricing Program by a covered entity participating in that program.
                    Prohibits a manufacturer of dangerous drugs, repackager of dangerous drugs,
                          third-party logistics provider, or wholesale distributor of dangerous drugs from requiring
                          a 340B covered entity to submit claims or utilization data as a condition for acquiring
                          certain drugs.
                    Makes a violation of these provisions a violation of Ohio’s Consumer Sales Practices Act
                          and authorizes the Attorney General to take actions to enforce compliance with the
                          bill’s provisions.
                    Specifies that the bill’s provisions are not to be construed as to conflict with or be less
                          restrictive than applicable federal or state laws and regulations.
                                                DETAILED ANALYSIS
Acquisition of drugs by 340B covered entities
       Generally, the bill prohibits a manufacturer of dangerous drugs, repackager of
dangerous drugs, third-party logistics provider, or wholesale distributor of dangerous drugs
from taking certain actions related to the acquisition of certain drugs by a 340B covered entity.
A 340B covered entity is an entity that under federal law is authorized to participate in the 340B
Drug Pricing Program, and includes certain categories of hospitals and certain nonhospital
                                                                                                              June 20, 2024
Office of Research and Drafting                       LSC                    Legislative Budget Office
providers that are eligible based on receiving federal funding and that generally provide care to
the medically underserved.1
       Under the bill, a manufacturer of dangerous drugs, repackager of dangerous drugs,
third-party logistics provider, or wholesale distributor of dangerous drugs may not deny,
prohibit, restrict, discriminate against, or otherwise limit the acquisition or delivery of a drug
included in the 340B Drug Pricing Program (referred to in the bill as a “340B drug”) by or to a
340B covered entity, unless the purchase or delivery of the drug is prohibited by the
U.S. Department of Health and Human Services (HHS). Similarly, the bill prohibits an entity
described above from requiring a 340B covered entity to submit any claims or utilization data as
a condition for the acquisition or delivery of a 340B drug by a 340B covered entity, unless the
claim or utilization data sharing is required by HHS.2
Enforcement
        The bill includes a violation of the above-mentioned provisions as an unfair or deceptive
act or practice in connection with a consumer transaction under Ohio’s Consumer Sales
Practices Act (CSPA).3 The CSPA generally permits the Attorney General to impose a civil penalty
of up to $5,000 or $25,000, depending on the offense. It also grants a private right of action for
the consumer against the alleged violator.4 Instead, the bill specifies that if a manufacturer of
dangerous drugs, repackager of dangerous drugs, third-party logistics provider, or wholesale
distributor of dangerous drugs violates the bill’s provisions, the Attorney General may initiate
criminal proceedings in accordance with existing law, or may assess a civil penalty of $50,000
for each violation.5
       The bill specifies that each package of drugs determined to be a violation of the bill’s
prohibitions constitutes a separate violation. In addition to the enforcement mechanisms
described above, the bill permits the Attorney General to refer complaints to the State Board of
Pharmacy for the Board to consider imposing additional sanctions as permitted by existing law.
The Attorney General may adopt rules or delegate rulemaking authority to the State Board of
Pharmacy to implement the bill’s requirements.6
        The bill specifies that its provisions are not to be construed to conflict with or be less
restrictive than applicable federal law or regulations, or existing state law or regulations.7
1   R.C. 4729.521(A)(1).
2   R.C. 4729.521(B)(1) and (2).
3   R.C. 1345.02, not in the bill.
4   R.C. 1345.07(A) and (C) and 1345.09, not in the bill.
5   R.C. 4729.521(C).
6   R.C. 4729.521(C) and (D).
7   R.C. 4729.521(E).
P a g e |2                                                                                   S.B. 269
                                                                                       As Introduced
Office of Research and Drafting         LSC                 Legislative Budget Office
                                      HISTORY
                             Action                        Date
Introduced                                      05-14-24
ANSB0269IN-135/sb
P a g e |3                                                                  S.B. 269
                                                                      As Introduced