95 F.4th 1136
8th Cir.2024Background
- PhRMA, representing pharmaceutical manufacturers, challenged Arkansas Act 1103, alleging it was preempted by federal law (specifically, Section 340B and the FDCA).
- Act 1103 prohibits drug manufacturers from restricting covered entities' use of contract pharmacies to distribute 340B drugs in Arkansas.
- Section 340B is a federal program requiring manufacturers to offer discounted drug prices to certain health care providers (covered entities) for low-income patients.
- Until 2020, manufacturers distributed 340B drugs to contract pharmacies; then several began restricting such contracts, limiting covered entities' ability to serve patients.
- PhRMA hired suit for declaratory and injunctive relief, arguing Act 1103 was preempted by federal law; the district court found no preemption, granting summary judgment to the state and intervening hospitals.
- On appeal, the Eighth Circuit affirmed the district court's ruling, holding Act 1103 was not preempted by federal law.
Issues
| Issue | PhRMA's Argument | McClain's Argument | Held |
|---|---|---|---|
| Field preemption by Section 340B | 340B is comprehensive, leaving no room for state law | 340B is silent on pharmacy delivery; states regulate pharmacy practice | No field preemption |
| Obstacle/conflict preemption by Section 340B | Act 1103 interferes with federal 340B objectives | Act 1103 supports 340B’s intent and patient access | No obstacle preemption |
| Impossibility preemption by FDCA/REMS | Act 1103 distribution requirement conflicts with REMS | Providers must contract with certified pharmacies; compliance possible | No impossibility preemption |
| State enforcement overlaps with HHS jurisdiction | State oversight intrudes on HHS’s exclusive role | State enforces contract pharmacy access, not pricing | No preemption; state can enforce |
Key Cases Cited
- Cipollone v. Liggett Grp., Inc., 505 U.S. 504 (Supremacy Clause, implied preemption doctrine)
- Oneok, Inc. v. Learjet, Inc., 575 U.S. 373 (distinction between field and conflict preemption)
- Astra USA, Inc. v. Santa Clara Cnty., Cal., 563 U.S. 110 (describing the 340B Program regulatory structure)
- Wyeth v. Levine, 555 U.S. 555 (presumption against preemption in state health/safety regulation)
- Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363 (obstacle preemption standard)
- PLIVA, Inc. v. Mensing, 564 U.S. 604 (impossibility preemption standard)
- Hillsborough Cnty., Fla. v. Automated Med. Lab’ys, Inc., 471 U.S. 707 (presumption against preemption for state health regulation)