Pharmaceutical Research and Manufacturers of America v. Weiser et al

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Regina M. Rodriguez
Civil Action No. 1:25-cv-02437-RMR-STV
PHARMACEUTICAL RESEARCH AND MANUFACTURERS
OF AMERICA,
Plaintiff,
v.
PHILIP WEISER, in his official capacity as Attorney General of
the State of Colorado; and KRISTEN WOLF, RYAN LEYLAND,
PATRICIA EVACKO, AVANI SONI, MICHAEL SCRUGGS,
ALEXANDRA ZUCCARELLI, and JAYANT PATEL, in their
official capacities as Members of the Colorado State Board of
Pharmacy,
Defendants.
ORDER
This matter comes before the Court on Plaintiff’s Motion for Preliminary Injunction,
Hearing Requested, ECF No. 10. Defendants filed a Response, ECF No. 33, and Plaintiffs
filed a Reply, ECF No. 46. Additionally, the Court has reviewed numerous decisions from
other federal courts related to nearly identical issues and has determined that a hearing
on the issue is unnecessary. For the reasons explained below, the Motion is DENIED.
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I. 	BACKGROUND1
The high cost of prescription drugs has led to concerns over affordability and
access. Several states have passed legislation to address this issue. Colorado recently
passed its version in Colorado Senate Bill 25-071 (“SB25-71”), now codified as the
Colorado 340B Contract Pharmacy Protection Act, Colorado Revised Statutes (C.R.S.)
§§ 6-29-101 et seq. (2025). Plaintiff asserts Colorado’s Act is preempted by federal law,
specifically, Section 340B of the Public Health Services Act (“Section 340B”), and
therefore, this Court should enjoin its enforcement.
A. 	Section 340B
Section 340B requires drug companies that participate in Medicaid and Medicare
Part B to offer discounts on certain outpatient drugs to “covered entities,” including public
hospitals, community health centers, and other entities providing care for low-income and
rural patients. 42 U.S.C. §§ 256b; Sanofi Aventis U.S. LLC v. United States Dep't of
Health & Hum. Servs., 58 F.4th 696, 699 (3d Cir. 2023). Section 340B allows providers
“to support their missions by maintaining services and lowering medication costs for
patients” through revenue generated from the program and up-front savings realized on
the cost of drugs. Gov't Accountability Off., Drug Pricing: Manufacturer Discounts in the
340B Program Offer Benefits, but Federal Oversight Needs Improvement 17 (GAO-11-
836, 	Sept. 	2011). 	“Drug 	manufacturers 	also 	must 	follow 	certain 	340B 	program
1 The following facts are from the “Background” sections of the parties’ briefing, ECF Nos. 10, 33, 46, in
combination with the summaries of the history of the 340B Program provided in numerous federal court
decisions. The Court has reviewed Defendants’ Notice of Related Cases, ECF No. 27, and in particular
leverages the background sections from PhRMA v. McClain, 95 F.4th 1136 (8th Cir. 2024) and Novartis
Pharms. Corp. v. Johnson, 102 F.4th 452 (D.C. Cir. 2024).
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requirements. Specifically, they must sell outpatient drugs to covered entities at or below
the statutorily determined price.” Gov't Accountability Off., Drug Pricing: Manufacturer
Discounts 	in 	the 	340B 	Program 	Offer 	Benefits, 	but 	Federal 	Oversight 	Needs
Improvement 13 (GAO-11-836, Sept. 2011). “The ceiling price is fixed by a statutory
formula strikingly generous to purchasers.” Novartis Pharms. Corp. v. Johnson, 102 F.4th
452, 456 (D.C. Cir. 2024).
In 1994, the Health Resources and Services Administration’s (“HRSA”) “initial
guidance stated that a covered entity may use a ‘purchasing agent.’ According to the
guidance, manufacturers may ship discounted drugs to this agent, which then must ship
them to the covered entity for dispensing to patients.” Id. Then in 1996, “HRSA recognized
that many covered entities use outside pharmacies to distribute drugs to their patients.
To accommodate them, HRSA stated that a covered entity without an in-house pharmacy
may contract with a single outside pharmacy to dispense drugs at a single location.” Id.
at 457. Fourteen years later, HRSA “opined that covered entities may contract with an
unlimited number of outside pharmacies and may do so regardless of whether the entities
have in-house pharmacies,” reasoning that “contract pharmacies enable covered entities
to 	‘create 	wider 	patient 	access 	by 	having 	more 	inclusive 	arrangements 	in 	their
communities.’” Id. (quoting Notice Regarding 340B Drug Pricing Program—Contract
Pharmacy Services, 75 Fed. Reg. 10,273). “[T]he outsourcing of pharmacy services has
allowed for drug dispensation closer to where low-income patients reside.” PhRMA v.
McClain, 95 F.4th 1136, 1139 (8th Cir. 2024).
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B. 	Colorado’s Act SB25-71
Today, covered entities rely on the use of contract pharmacies to take full
advantage of Section 340B. ECF No. 33 at 5. As covered entities increased their use of
contract 	pharmacies, 	pharmaceutical 	companies 	responded 	by 	restricting 	covered
entities from contracting with outside pharmacies for Section 340B drug dispensation. Id.
In response, states began enacting state laws to fill the gap in federal law to ensure that
covered entities in their states could retain access to the Section 340B financial
resources. Id. at 6. In 2025, the Colorado General Assembly enacted the Colorado 340B
Contract Pharmacy Protection Act (“SB25-71”), which states “a manufacturer, third-party
logistics provider, or repackager . . . shall not, directly or indirectly, deny, restrict, prohibit,
discriminate against, or otherwise limit the acquisition of a 340B drug by, or delivery of a
340B drug to, a 340B covered entity, a pharmacy contracted with a 340B covered entity,
or a location otherwise authorized by a 340B covered entity to receive and dispense 340B
drugs.” Colo. Rev. Stat. § 6-29-105(1)(a). SB25-71 also states “a manufacturer shall not
directly or indirectly require, including as a condition, a 340B covered entity, a pharmacy
contracted with a 340B covered entity, or any other location authorized to receive 340B
drugs by a 340B covered entity to submit any health information, claims or utilization
data . . . or other data that does not relate to a claim submitted to federal health care
program, unless such data is voluntarily furnished by such covered entity or otherwise
required to be furnished under applicable federal law. Colo. Rev. Stat. § 6-29-105(1)(b).
A violation of SB25-71 is an unfair or deceptive trade practice under the Colorado
Consumer Protection Act (“CCPA”), and the violator is subject to the CCPA’s enforcement
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and penalty provisions. § 6-29-105(3)(a). A person regulated by Colorado’s State Board
of Pharmacy who violates the CCPA provisions may be subject to Pharmacy Board
discipline. § 6-29-105(3)(d).
C. 	Related Cases and Court Decisions
There are two pending related cases in this district: AbbVie Inc. v. Weiser, et al.,
Case 	No. 	25-cv-01847-WJM-KAS, 	filed 	June 	12, 	2025; 	and 	AstraZeneca
Pharmaceuticals LP v. Weiser, et al., Case No. 25-cv-02685-PAB, filed August 27, 2025.
In AbbVie, Judge Martinez denied AbbVie’s Motion for Preliminary Injunction, finding that
it had not established a substantial likelihood of success on the merits of its preemption
or Takings Clause claims. AbbVie, Inc. v. Weiser, No. 25-CV-1847-WJM-KAS, 2025 WL
3041825, at *5 (D. Colo. Oct. 31, 2025). On November 19, 2025, AbbVie filed a Notice of
Appeal as to Judge Martinez’s order denying the preliminary injunction, and the issue is
currently on appeal in the Tenth Circuit. In AstraZeneca, Judge Brimmer also denied
AstraZeneca’s Motion for Preliminary Injunction after analyzing likelihood of success on
its preemption and other related claims. Astrazeneca Pharms. LP v. Weiser, No. 25-CV-
02685-PAB-STV, 2025 WL 3653161, at *11 (D. Colo. Dec. 17, 2025). Two days later,
AstraZeneca filed its Notice of Appeal as to Judge Brimmer’s order denying the
preliminary injunction, and the issue is also on appeal in the Tenth Circuit. Similar cases
challenging comparable state laws brought by these and other pharmaceutical companies
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have been filed in several federal district courts. AbbVie, 2025 WL 3041825, at *4. The
majority of these lawsuits have been unsuccessful.2 Id. (compiling cases).
Other circuit courts have affirmed the lower court decisions regarding whether or
not 	Section 	340B 	preempts 	state 	laws, 	like 	Colorado’s 	SB25-71, 	that 	prohibit
manufacturers from limiting covered entities from contracting with outside pharmacies.
Most recently, the Fifth Circuit reviewed the plaintiffs’ federal preemption, unconstitutional
taking, and unconstitutional vagueness claims in their motion for summary judgment and
found none prohibited the Louisiana state law, affirming the lower court’s denial of
plaintiff’s motion. AbbVie, Inc. v. Murrill, 166 F.4th 528, 537, 549 (5th Cir. 2026). Likewise,
2 In addition to the cases compiled by Judge Martinez, the Court is also aware of the following cases:
AbbVie, Inc., et al. v. Skrmetti, No. 25-cv-00519, 2026 WL 542712 (M.D. Tenn. Feb. 26, 2026) (granting
motion to dismiss); AstraZeneca Pharmaceuticals LP v. Lopez, No. 25-cv-00369 (D. Haw. Feb. 23, 2026)
(denying motion for preliminary injunction); AbbVie, Inc., et al. v. Brown, Nos. 25-cv-0071, 25-cv-00284,
25-cv-00308, 2025 WL 3228898 (D. Utah Nov. 19, 2025) (granting in part motion to dismiss Due Process
and Commerce Clause claims and denying in part motion to dismiss with respect to Supremacy Clause
and Takings claims); AbbVie Inc. et al. v. Drummond, Case Nos. Civ-25-726, Civ-25-727, Civ-25-1156
(W.D. Okla. Oct. 31, 2025) (granting in part and denying in part preliminary injunction).
The cases compiled by Judge Martinez include: AbbVie Inc. v. Neronha, 1:25-cv-00388-JJM-AEM (D.R.I.
Sept. 30, 2025) (denying preliminary injunction as to Rhode Island law); AbbVie, Inc. v. Frey, 2025 WL
2813787, at *1 (D. Me. Sept. 23, 2024) (same as to Maine law); AstraZeneca Pharms. LP v. Fitch, 766 F.
Supp. 3d 657, 664–65 (W.D. Miss. 2024) (same as to Mississippi law); Novartis Pharms. Corp. v. Fitch,
738 F. Supp. 3d 737, 749–50 (S.D. Miss. 2024) (same); AbbVie Inc. v. Skrmetti, 2025 WL 1805271, at
*18 (M.D. Tenn. June 30, 2025) (same as to Tennessee law); AstraZeneca Pharms. LP v. Bailey, 2025
WL 644285, at *3 (W.D. Mo. Feb. 27, 2025) (granting motion to dismiss manufacturer’s claims that
Missouri law was preempted and violated the Takings Clause); PhRMA v. Murrill, 2024 WL 4361597, at
*8–9 (W.D. La. Sept. 30, 2024) (granting summary judgment in favor of State on manufacturers’ claims
that Louisiana law was preempted and violated the Takings Clause); AbbVie Inc. v. Fitch, 2024 WL
3503965, at *12 (S.D. Miss. July 22, 2024) (denying preliminary injunction as to Mississippi law), aff’d 152
F.4th 635 (5th Cir. 2025); PhRMA v. Fitch, 2024 WL 3277365, at *11 (S.D. Miss. July 1, 2024) (same);
PhRMA v. McClain, 645 F. Supp. 3d 890 (E.D. Ark. 2022) (granting summary judgment in favor of
Arkansas official on manufacturers’ claim that Arkansas law was preempted), aff’d 95 F.4th 1136 (8th Cir.
2024), cert. denied 145 S.Ct. 768 (2024); but see AstraZeneca Pharms. LP v. Harris, No. 4:24-cv-00268-
KGB (E.D. Ark. Sept. 30, 2025), ECF No. 141 (denying judgment on the pleadings as to manufacturer’s
claim that Arkansas law violated Takings Clause); PhRMA v. Morrisey, 760 F. Supp. 3d 439, 452–60
(S.D.W. Va. 2024) (granting preliminary injunction as to West Virginia law and denying the defendants’
motion to dismiss).
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in Novartis, the District of Columbia Circuit held “that Section 340B does not categorically
prohibit manufacturers from imposing conditions on the distribution of covered drugs to
covered entities.” Novartis Pharms. Corp. v. Johnson, 102 F.4th at 464. The Eighth Circuit
has also held that Arkansas’ state law is not preempted by Section 340B or the Federal
Food, Drug, and Cosmetic Act’s Risk Evaluation and Mitigation Strategies. McClain, 95
F.4th at 1146.
II. 	LEGAL STANDARD
Federal Rule of Civil Procedure 65 authorizes a district court to enter preliminary
injunctions. Fed. R. Civ. P. 65(a). “Preliminary injunctions are extraordinary remedies
requiring that the movant’s right to relief be clear and unequivocal.” Planned Parenthood
of Kan. v. Andersen, 882 F.3d 1205, 1223 (10th Cir. 2018). A party seeking preliminary
injunctive relief must satisfy four factors: (1) a likelihood of success on the merits; (2) a
likelihood that the movant will suffer irreparable harm in the absence of preliminary relief;
(3) that the balance of equities tips in the movant’s favor; and (4) that the injunction is in
the public interest. Petrella v. Brownback, 787 F.3d 1242, 1257 (10th Cir. 2015). A party
seeking an injunction must demonstrate that “all four of the equitable factors weigh in its
favor,” Sierra Club, Inc. v. Bostick, 539 F. App’x 885, 888 (10th Cir. 2013), and a “plaintiff’s
failure to prove any one of the four preliminary injunction factors renders its request for
injunctive relief unwarranted.” Vill. of Logan v. U.S. Dep’t of Interior, 577 F. App’x 760,
766 (10th Cir. 2014).
In addition to the four factors, a district court must also consider whether the
movant’s request falls within one of the “disfavored injunction” categories. Those
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categories of disfavored injunctions include those that will (1) alter the status quo, (2)
mandate an affirmative act by the defendant, or (3) afford all the relief that the movant
could expect to win at trial. Schrier v. Univ. of Colo., 427 F.3d 1253, 1259 (10th Cir. 2004).
Here, Plaintiff’s motion requests a disfavored injunction. Accordingly, Plaintiff “must make
a strong showing both on the likelihood of success on the merits and on the balance of
the harms.” Colo. v. E.P.A., 989 F.3d 874, 884 (10th Cir. 2021) (quotation omitted).
III. 	ANALYSIS
The Court has reviewed Plaintiff’s Motion and Complaint, Defendants’ response,
and Plaintiff’s Reply. For the reasons stated below, the Court finds that Plaintiff has failed
to meet its burden of showing that a preliminary injunction is warranted.
A. 	Likelihood of Success on the Merits
First, a plaintiff must establish a substantial likelihood of prevailing on the merits of
his claims. Prairie Band of Potawatomi Indians v. Pierce, 253 F.3d 1234, 1246 (10th Cir.
2001). Here, Plaintiff argues that SB25-71 is preempted under both field and conflict
preemption principles. ECF No. 10 at 11-23. Defendants contest both field and conflict
preemption exists and assert that Plaintiff lacks standing. ECF No. 33 at 9-22. With regard
to standing, Defendants contend that PhRMA characterizes an economic injury that
cannot be traceable to Defendants, because SB25-71 “neither compels PhRMA members
to participate in 340B nor directs PhRMA members to sell 340B drugs directly to
pharmacies.” ECF No. 33 at 12-14. PhRMA emphasizes that it need only show an injury
is “fairly traceable” and that “[e]conomic injury is quintessential Article III injury.” ECF No.
46 at 18. PhRMA argues SB71-25 “forces manufacturers to provide 340-priced drugs
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where they would otherwise not be required to do so.” Id. at 19. While SB71-25 does not
impact the price of Section 340B drugs, it does affect the overall cost of PhRMA’s
participation 	in 	Section 	340. 	This 	economic 	injury 	is 	sufficiently 	“concrete 	and
particularized” and “fairly traceable” to SB71-25 to establish standing. See Astrazeneca,
2025 WL 3653161, at *5. Having demonstrated standing, “the party claiming preemption
. . . bears the burden of showing with specificity that Congress intended to preempt state
law.” Day v. SkyWest Airlines, 45 F.4th 1181, 1184 (10th Cir. 2022) (citation omitted).
“Congress’s intent to preempt state law can be shown ‘through a statute’s express
language’ or implied ‘through its structure and purpose.’” Altria Grp., Inc. v. Good, 555
U.S. 70, 76 (2008)).
1. 	Field Preemption
“The Supremacy Clause provides a clear rule that federal law ‘shall be the
supreme Law of the Land; and the Judges in every State shall be bound thereby, any
Thing in the Constitution or Laws of any state to the Contrary notwithstanding.’ Under this
principle, Congress has the power to preempt state law.” Arizona v. United States, 567
U.S. 387, 399 (2012) (quoting Art. VI, cl. 2.). “Field preemption is one variety of implied
preemption. It exists where ‘a framework of regulation’ of a field is ‘so pervasive’ that it
leaves no space for state supplementation or where the federal interest is ‘so dominant’
that the existence of a federal scheme can ‘be assumed to preclude enforcement of state
laws on the same subject.’” Bradshaw v. Am. Airlines, Inc., 123 F.4th 1168, 1173 (10th
Cir. 2024) (quoting Arizona, 567 U.S. at 399).
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PhRMA argues that SB25-71 is “field preempted because it regulates in an
exclusively federal field (a program that is the product of Congress’s spending power)
where Congress has set the terms of participation and obligations incurred.” ECF No. 10
at 17. PhRMA contends that “Congress deemed it essential that 340B be administered
‘harmoniously and on a uniform, nationwide basis.’” ECF No. 10 at 20 (quoting Astra USA,
Inc. v. Santa Clara Cnty., Cal., 563 U.S. 110, 120 (2011)). According to PhRMA, Congress
did not “authorize states to alter the procedures and conditions governing manufacturers’
voluntary 	participation 	in 	340B 	(and, 	by 	extension, 	Medicare 	and 	Medicaid).” 	Id.
Defendants counter that “Congress did not intend for 340B to preempt the field” and that
the Section 340B is “not so pervasive that Congress left no room for the States to
supplement it.” ECF No. 33 at 17 (citations omitted, cleaned up).
First, the Court notes that Astra, which PhRMA relies on, discusses the similar but
unique issue of whether or not “340B entities, though accorded no right to sue for
overcharges under the statute itself, may nonetheless sue allegedly overcharging
manufacturers 	as 	third-party 	beneficiaries 	of 	the 	PPAs 	(Pharmaceutical 	Pricing
Agreements) to which the manufacturers subscribed.” Astra, 563 U.S. at 113. In Astra,
the Supreme Court held that “suits by 340B entities to enforce ceiling-price contracts
running between drug manufacturers and the Secretary of HHS [“Health and Human
Services”] are incompatible with the statutory regime.” Id. Specifically, the Supreme Court
determined that “Congress placed the Secretary (acting through her designate, HRSA) in
control of § 340B’s drug-price prescriptions.” Id. at 114. PhRMA interprets this holding to
mean that 340B, as a whole, is “a matter for Congress alone.” ECF No. 10 at 21. The
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Court disagrees. The Supreme Court determined in Astra that “Congress vested authority
to oversee compliance with the 340B Program in HHS and assigned no auxiliary
enforcement role to covered entities.” Astra, 563 U.S. at 117. Astra specifically held that
Congress intended to “strengthen and formalize HRSA’s enforcement authority” of PPAs
and “to render the agency’s resolution of covered entities’ complaints binding, subject to
judicial review under the APA.” Id. at 121-22. The Astra decision did not discuss or
contemplate 	whether 	there 	was 	room 	in 	the 	340B 	program 	itself 	for 	state
supplementation, the field preemption issue in the instant case.
Second, while not controlling, the Court finds the Eight Circuit’s analysis of Section
340B and the Arkansas law comparable to SB25-71, Ark. Code Ann. § 23-92-604(c) (“Act
1103”), compelling on the issue. See Pharm. Rsch. & Manufacturers of Am. v. McClain,
95 F.4th 1136 (8th Cir.). Like SB25-71, “Act 1103 prohibits manufacturers from limiting
covered entities’ ability to contract with outside pharmacies.” Id. at 1139. The Eighth
Circuit helpfully summarized the 340B program:
The 340B program has three basic parts: (1) a cap on drug makers’ prices,
(2) restrictions on covered entities, and (3) compliance mechanisms” for both
covered entities and manufacturers. Sanofi Aventis U.S. LLC v. U.S. Dep't
of Health & Hum. Servs., 58 F.4th 696, 699 (3d Cir. 2023). First, as a
condition of participating in Medicaid, drug manufacturers must opt into the
340B Program by signing a form Pharmaceutical Pricing Agreement with the
Secretary of HHS. Astra, 563 U.S. at 113. The Pharmaceutical Pricing
Agreement requires manufacturers to sell drugs to covered entities at a
discounted “ceiling price.” 	42 U.S.C. § 256b(a)(1). The ceiling price is
determined by a statutory formula. 42 U.S.C. §§ 256b(a)(2), 1396r-8(c). The
second part of 340B mandates that discounted prices are only made
available to covered entities. Id. § 256b(a). Covered entities are defined by
statute to include fifteen different types of public and not-for-profit hospitals,
community centers, and clinics that are “dominantly, local facilities that
provide medical care for the poor.” Astra, 563 U.S. at 115; see also 42
U.S.C. 	§ 	256b(a)(4). 	Finally, 	the 	340B 	Program 	includes 	compliance
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mechanisms, penalties for noncompliance or abuse by manufacturers and
covered entities, and a dispute resolution process through HHS. See,
e.g., Astra, 	563 	U.S. 	at 	115-16; Sanofi 	Aventis, 	58 	F.4th 	at 	701-2.
Manufacturers are required to report their 340B ceiling prices to the HRSA
on 	a 	quarterly 	basis 	and 	are 	subject 	to 	auditing. 42 	U.S.C. 	§
256b(a)(1), (a)(5)(C).
Id. at 1141. The Eighth Circuit agreed with the Third Circuit in that “the 340B Program is
silent about delivery and distribution of pharmaceuticals to patients.” Id. at 1142 (citation
omitted). Indeed, Judge Martinez confirmed that “federal Circuit Courts of Appeal now
concur that Section 340B is silent about delivery.’” Abbvie, 2025 WL 3041825, at *6 (citing
Sanofi Aventis, 58 F.4th at 702; Novartis Pharms., 102 F.4th at 461; Fitch, 152 F.4th at
646).
Like SB25-71, Act 1103 “prohibits pharmaceutical manufacturers from interfering
in a covered entity’s agreement with a contract pharmacy by denying the pharmacy
access to a covered entity’s 340B drugs” and “prohibits pharmaceutical manufacturers
from interfering in a covered entity’s agreement with a contract pharmacy by denying
340B drug pricing to covered entities who use contract pharmacies for distribution.” Id. at
1143. PhRMA argued in McClain, as it does here, that Act 1103 was field preempted by
Section 340B. Id. The Eighth Circuit disagreed, explaining that “when it comes to
pharmaceuticals, the federal government has traditionally regarded state law as a
complementary form of drug regulation and has long maintained that state law offers an
additional, and important, layer of consumer protection that complements [federal]
regulation.” Id. at 1143-44 (quoting Lefaivre v. KV Pharm. Co., 636 F.3d 935, 940-41 (8th
Cir. 2011)). Thus, the Eight Circuit found that “Congress’s decision not to legislate the
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issue of pharmacy distribution indicates that Section 340B is not intended to preempt the
field.” Id. at 1143.
Finally, the Court reiterates that the majority of other courts have also found that
Congress did not intend for Section 340B to preempt the field. See AbbVie Inc. v.
Skrmetti, No. 3:25-CV-00519, 2025 WL 1805271, at *13 (M.D. Tenn. June 30, 2025)
(“The primary problem with the plaintiff’s position is that neither AbbVie’s policy nor S.B.
1414 says anything about the pricing of 340B drugs; both entirely concern the delivery of
340B drugs. . . . [T]his court finds that Congress did not intend to preempt the field.”);
Pharm. Rsch. & Manufacturers of Am. v. Bailey, No. 2:24-CV-04144-MDH, 2025 WL
644281, at *5 (W.D. Mo. Feb. 27, 2025) (“The Eighth Circuit found that a statute which
establishes enforcement for the distribution of 340B drugs and the federal 340B law's
enforcement scheme address two completely different issues and thus Congress did not
inten[d] to preempt the field with its 340B legislation.”); AstraZeneca Pharms. LP v. Fitch,
766 F. Supp. 3d 657, 665 (S.D. Miss. 2024) (“The Eighth Circuit and this Court have
previously held that Congress did not intend to preempt the field when it enacted 340B.”);
Pharm. Rsch. & Manufacturers of Am. v. Murrill, No. 6:23-CV-00997, 2024 WL 4361597,
at *8 (W.D. La. Sept. 30, 2024) (“[T]he Court concludes that Plaintiffs cannot establish
that “Congress has unmistakably so ordained” that state regulatory power be displaced
with respect to contract pharmacies under the Section 340B program.”). The Court
interprets Section 340B the same way and finds that it was not intended to preempt the
field.
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Thus, the Court concludes that PhRMA is unlikely to succeed on the merits of its
field preemption claim.
2. 	Conflict Preemption
PhRMA also argues that SB25-71 conflicts with Section 340B. Conflict preemption
exists when a state-law provision conflicts with federal law either because “(1) compliance
with both federal and state regulations is a physical impossibility, or because the provision
(2) stands as an obstacle to the accomplishment and execution of the full purposes and
objectives of federal law.” United States v. Supreme Ct. of New Mexico, 839 F.3d 888,
918 (10th Cir. 2016). PhRMA makes three arguments to support its conflict preemption
claim: (1) SB25-71 impermissibly expands the scope of federal Section 340B obligations;
(2) SB25-71 unlawfully limits access to claims data; and (3) SB25-71 conflicts with the
federal enforcement regime. ECF No. 10 at 16-23.
a. 	Scope of 340B Obligations
First, PhRMA argues that SB25-71 conflicts with Section 340B’s “offer-and-
acceptance mechanism and unlawfully expand the scope of the federal subsidy by
requiring additional 340B-priced transactions.” ECF No. 10 at 16. According to PhRMA,
SB25-71 “directly interferes with the methods by which the federal statute was designed
to achieve its purposes and reworks manufacturers’ 340B obligations.” Id. PhRMA relies
on Novartis, which held that “[S]ection 340B does not categorically prohibit manufacturers
from imposing conditions on the distribution of covered drugs to covered entities."
Novartis Pharms. Corp. v. Johnson, 102 F.4th 452, 464 (D.C. Cir. 2024). PhRMA attempts
to extend this holding to mean that SB25-71 impermissibly interferes with manufacturers’
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“control over how they sell 340B-priced drugs.” ECF No. 10 at 22. The Court disagrees.
SB25-71 does not alter the definitions of “covered entity” or “340B drug.” Colo. Rev. Stat.
§ 6-29-105(1)(a). Instead, it prohibits a manufacturer from preventing or limiting the
acquisition of a 340B drug to a contract pharmacy or a location otherwise authorized by
a 340B covered entity. Id. On its face, this requirement does not conflict with Section
340B’s requirement to sell 340B drugs at the statutorily determined price. “When covered
entities enter into agreements with contract pharmacies, these pharmacies do not
become 	beneficiaries 	of 	the 	340B 	program. . . . Covered 	entities 	using 	contract
pharmacies still order and pay for the drugs, but they are shipped directly to the
pharmacies.” McClain, 95 F.4th at 1142 (citations omitted, cleaned up). When a covered
entity uses a contract pharmacy, “the pharmacy becomes an agent of the covered entity
with the authorization to dispense 340B drugs to patients of the covered entity pursuant
to a prescription.” Id. In other words, SB25-71 works in concert with Section 340B to
“provide more comprehensive services and reach more eligible patients.” ECF No. 33 at
18 (citing McClain, 95 F.4th at 1144-45). Judge Brimmer similarly found “no preemption
issue raised by S.B. 71 attaching itself to Section 340B” because SB25-71 helps
accomplish Section 340B’s mission to help “healthcare providers reach more eligible
patients and provide more comprehensive services.” AstraZeneca, 2025 WL 3653161, at
*8.
Thus, the Court finds that PhRMA has not demonstrated a likelihood of success
on the merits of its preemption claim based on SB25-71’s purported expansion of the
scope of Section 340B obligations.
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b. 	Claims-Data Restriction
Second, PhRMA argues that SB25-71 “unlawfully limits access to claims data.”
ECF No. 10 at 25. SB25-71 bars manufacturers from “requir[ing], including as a condition,
a 340B covered entity, a pharmacy contracted with a 340B covered entity, or any other
location authorized to receive 340B drugs by a 340B covered entity to submit any health
information, claims or utilization data, purchasing data, payment data, or other data that
does not relate to a claim submitted to a federal health care program, unless such data
is voluntarily furnished by such covered entity or otherwise required to be furnished under
applicable federal law.” Colo. Rev. Stat. § 6-29-105(1)(b). PhRMA contends that “[u]nder
the federal regime, a manufacturer must first audit a covered entity before initiating ADR
(“alternative 	dispute 	resolution”) 	claim.” 	ECF 	No. 	10 	at 	26 	(citing 	42 	U.S.C.
§ 256b(a)(5)(C), (d)(3)(B)(iv)). According to PhRMA, SB25-71 is preempted, because it
prevents manufacturers from obtaining audit documents and “hides this information,
limiting manufacturers’ access to evidence of federal violations and handicapping
manufacturers’ use of the exclusive federal resolution process.” ECF No. 10 at 27.
SB25-71 goes on to state that “subsection (1) of this section does not prohibit a
manufacturer from requiring health information or other data that a covered entity is
required to furnish to a manufacturer under applicable federal law, including data relating
to an audit in accordance with procedures established by the Federal Department of
Health and Human Services under 42 U.S.C. Sec. 256b(a)(5)(C).” Colo. Rev. Stat. § 6-
29-105(5). SB25-71 does not prohibit the audit required under Section 340B. Instead, it
simply does not permit manufacturers to require such claims data unless federal law
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mandates it. Thus, like Judge Brimmer and other judges addressing this argument, the
Court does not find that PhRMA has demonstrated a likelihood of success on the merits
of its preemption claim based on SB25-71’s claim-data restriction. See AstraZeneca,
2025 WL 3653161, at *10.
Additionally, PhRMA’s arguments that the Medicare Drug Negotiation Program
necessitates claims data fails. Under this program, HHS is required to negotiate maximum
fair prices with manufacturers for certain drugs. 42 U.S.C. § 1320f-3(a). Manufacturers
need claims data to avoid providing duplicative price reductions. PhRMA alleges that
SB25-71’s claim-data restriction “hides that data.” ECF No. 10 at 27. The Court disagrees.
Because SB25-71’s claims-data restriction does not apply if the data is “otherwise
required to be furnished under applicable federal law,” manufacturers may access the
claims data necessary to appropriately participate in the Medicare Drug Negotiation
Program.
Accordingly, the Court is not persuaded by PhRMA’s second conflict preemption
argument based on SB25-71’s claim-data restriction.
c. 	Federal Enforcement Regime
Third, 	PhRMA 	argues 	that 	SB25-71 	“conflicts 	with 	the 	exclusive 	federal
administrative and enforcement regime.” ECF No. 10 at 28. Again, PhRMA repurposes
conflict preemption arguments presented in other similar federal cases. PhRMA contends
that (1) SB25-71 allows private entities to file suit while Congress does not; and (2) HHS
has authority to address the issues SB25-71 targets. Id. at 28-29. AstraZeneca has
similarly argued (1) “S.B. 71 authorizes the Colorado Attorney General and district
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attorneys to bring civil actions to enjoin violations and recover penalties” and (2) “SB25-
71 would require state adjudicators to consider and resolve questions of federal law to
determine whether a manufacturer violated the statute. AstraZeneca, 2025 WL 3653161,
at *9. Judge Brimmer found—and this Court agrees—that SB25-71 creates enforcement
authority for violations of SB25-71 itself, not Section 340B, and state courts are regularly
called to decide questions of federal law. Id. Thus, the enforcement authority under SB25-
71 does not conflict with that of Section 340B.
Accordingly, the Court concludes that PhRMA is unlikely to succeed on the merits
of its conflict preemption claim.
B. 	Irreparable Harm
The Tenth Circuit has explained that “[t]o merit preliminary injunctive relief, a
movant must present a significant risk it will experience harm that cannot be compensated
after the fact by money damages. . . . The injury must also be of such imminence that
there is clear and present need for equitable relief to prevent irreparable harm.” State v.
U.S. Env't Prot. Agency, 989 F.3d 874, 884 (10th Cir. 2021) (citations omitted, cleaned
up). 	PhRMA 	argues 	that 	its 	members 	suffer 	“irreparable 	harm 	in 	the 	form 	of
unrecoverable compliance costs and unrecoverable lost resources” absent relief. ECF
No. 10 at 30. It also contends that its “members have and will continue to expend
significant time and financial resources in analyzing the effects of the Act, determining
how to comply with both it and federal law.” Id. “[T]o constitute irreparable harm, an injury
must be imminent, certain, actual, and not speculative.” Id. at 886 (citation omitted).
PhRMA does not provide specific evidence to demonstrate “imminent, certain and actual
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harm.” Without more, PhRMA fails to establish irreparable harm to support its claim for
preliminary injunction.
C. 	Balance of Hardships and Public Interest
PhRMA argues, in a single paragraph, that the “balance of harms and public
interest also favor relief.” ECF No. 10 at 31. PhRMA states that “the federal government
has long regulated 340B exclusively, and PhRMA’s members operated under that
scheme and relied on its exclusively federal nature.” Id. However, PhRMA ignores that
fact that the purpose of Section 340B is to allow providers “to support their missions by
maintaining services and lowering medication costs for patients” through revenue
generated from the program and up-front savings realized on the cost of drugs. Gov't
Accountability Off., Drug Pricing: Manufacturer Discounts in the 340B Program Offer
Benefits, but Federal Oversight Needs Improvement 17 (GAO-11-836, Sept. 2011). As
described above, SB25-71 supports this mission by working in conjunction with Section
340B by allowing contract pharmacies to become an agent of the covered entity and
dispense 340B drugs to patients of the covered entity. Thus, the Court is unpersuaded
by PhRMA’s argument that balance of harms and public interest favor relief.
IV. 	CONCLUSION
For the reasons stated herein, Plaintiff’s Motion for Preliminary Injunction, ECF No.
10, is DENIED.
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DATED: March 18, 2026
BY THE COURT:
_____________________________
REGINA M. RODRIGUEZ
United States District Judge
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