STAND. COM. REP. NO. 558

Honolulu, Hawaii

, 2025

RE: H.B. No. 712

H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 712, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO HEALTH,"

begs leave to report as follows:

The purpose of this measure is to preserve the integrity of the federal 340B Drug Pricing Program by prohibiting drug manufacturers from denying, restricting, or prohibiting the acquisition, shipping, or delivery of a 340B drug to a pharmacy under contract with any 340B covered entity in the State.

Your Committee received testimony in support of this measure from the State Health Planning and Development Agency; Hawaiʻi Pacific Health; Hawaii Primary Care Association; Healthcare Association of Hawaii; Hawaiʻi Island Community Health Center; The Queen's Health Systems; Hawaiʻi Health & Harm Reduction Center; Waianae Coast Comprehensive Health Center; AlohaCare; and two individuals. Your Committee received testimony in opposition to this measure from the Pharmaceutical Research and Manufacturers of America and Biotechnology Innovation Organization. Your Committee received comments on this measure from the Department of Health; Department of Commerce and Consumer Affairs; Alliance for Safe Biologic Medicines; Biomarker Collaborative; Coalition of Hematology & Oncology Practices; Exon20 Group; H.E.A.L.S. of the South; Hispanic Business Alliance; International Cancer Advocacy Network; Lupus and Allied Diseases Association, Inc.; MET Crusaders; National Infusion Center Association; Neuropathy Action Foundation; and PDL1 Amplifieds.

Your Committee finds that section 340B of the Public Health Service Act requires pharmaceutical manufacturers participating in Medicaid to sell outpatient drugs at discounted prices to health care organizations that care for many uninsured and low-income patients. These organizations include federal grantee organizations and several types of hospitals, including critical access hospitals, sole community hospitals, rural referral centers, and public and nonprofit disproportionate share hospitals that serve low-income and indigent populations.

Your Committee further finds that the 340B drug pricing program is critical to Hawaii's public health and health care systems. For example, Hawaii's Federally Qualified Health Centers, the largest of which attends to over forty thousand lives, rely on 340B savings for patients and organization to continue providing quality services due to less-than-market reimbursement. This measure preserves the 340B Drug Pricing Program in the State.

As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 712, H.D. 1, and recommends that it be referred to your Committee on Judiciary & Hawaiian Affairs.

Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,

____________________________

SCOT Z. MATAYOSHI, Chair