A North Dakota law aimed at protecting medication subsidies for low-income patients has been struck down by a federal judge, calling the statute an unconstitutional overreach that makes hospitals richer at the expense of pharmaceutical companies, according to reporting by Mary Steurer from the North Dakota Monitor.
U.S. District Court Judge Dan Traynor issued the order on Monday, April 27, blocking the enforcement of House Bill 1473. The law, passed in 2025, hoped to protect the state’s access to the federal 340B Drug Pricing Program. Under this program, drug manufacturers provide steep discounts, sometimes as low as 1% of retail price, to hospitals and clinics that serve low-income populations. Supporters of the law say it benefits rural communities across the state by protecting healthcare access for low-income populations, ensuring they actually reap the benefit from the federal program.
The state intended to mandate manufacturers to sell discounted drugs to multiple third-party pharmacies. The state forbade manufacturers from requiring claims data from hospitals under the program, while Traynor ruled that blocking data makes it impossible for companies to verify eligibility. The state also intended to make restricting 340B access a Class B Misdemeanor. Traynor said in his opinion that this allows North Dakota hospitals to exploit drug manufacturers. He characterized the 340B program as one currently being “abused to provide a windfall to hospital conglomerates and participating pharmacies.” Traynor ruled that the law violates the Supremacy Clause of the U.S. Constitution by attempting to override federal guidelines that allow manufacturers to set certain conditions on their discounts. He also said it unconstitutionally regulates interstate commerce.
According to the Monitor, this ruling is a blow to rural North Dakota healthcare providers. During legislative hearings, rural hospital representatives testified that they rely on 340B subsidies to fund charity care and keep doors open in small communities, and offset rising costs for equipment and infrastructure. They say that HB 1473 is needed to help rural communities access quality care.
Solicitor General Phil Axt argued that the state was simply filling a “regulatory gap” left by the federal government, but Traynor disagreed, saying the law makes participation in Medicare and Medicaid too expensive. Axt also pushed back on the idea that HB 1473 doesn’t benefit low-income residents.
The ruling currently applies to the portions of the lawsuit AbbVie and the Pharmaceutical Researchers and Manufacturers of America brought against HB 1473. A final decision regarding AstraZeneca is still pending.
The North Dakota Attorney General’s Office stated on Tuesday that they have not yet decided whether to appeal the decision to the 8th Circuit Court of Appeals.
Read original reporting here: https://northdakotamonitor.com/2026/04/28/north-dakota-medication-access-law-unconstitutional-judge-says/
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