A federal judge has blocked North Dakota’s 340B drug-discount law, a decision that adds to the national fight over how far states can go in expanding the federal program.

The ruling found North Dakota’s law was preempted by federal law and could not force drug manufacturers to provide discounted drugs through broader third-party pharmacy arrangements.

The Wall Street Journal editorial board highlighted the case as a warning that 340B, originally intended to help hospitals serving low-income patients, has grown into a cost-shifting system benefiting hospital systems and pharmacy partners while doing little to lower costs for patients.

“This ruling is a reminder that mandates do not make costs disappear,” said James Lee, managing director of public policy services for the Ohio Manufacturers’ Association. “When states expand federal programs without real accountability, the costs are pushed somewhere else, including onto employers, manufacturers and the broader health care system.”

With similar 340B laws moving across the country, the case underscores a broader concern for Ohio’s manufacturing community. Expanding federal requirements without accountability can raise costs without ensuring savings reach patients. 5/14/2026