The Financial Impact to Medicaid from Contract Pharmacy 340B Manufacturer Mandates

To date, eleven states have enacted legislation concerning the 340B Drug Pricing Program: Arkansas, Louisiana, West Virginia, Missouri, Kansas, Maryland, Minnesota, Mississippi, North Dakota, South Dakota, and Utah. While specific provisions of these laws vary by state, all mandate manufacturers to provide 340B pricing on sales at contract pharmacies. As of April 2025, at least twenty-five additional states have introduced contract pharmacy 340B manufacturer mandate bills. As state lawmakers consider these proposals, they may assess the fiscal implications of such legislation.

This brief evaluates one such implication: a potential increase in Medicaid rebates that states could no longer collect (“ineligible rebates”) due to the expansion of the 340B program under these laws and the prohibition on 340B/Medicaid “duplicate discounts.”

This study was funded by the Pharmaceutical Research and Manufacturers of America.