A Colorado district court judge denied drug manufacturer AstraZeneca’s request for an injunction to block enforcement of a recent law barring drug manufacturers from imposing restrictions on covered entities to obtain drugs under a federal discount program.

The law states that manufacturers and others may not directly or indirectly deny, restrict or limit the acquisition of a 340B drug by covered entities, such as a pharmacy.

AstraZeneca argued that the state law passed during the 2025 legislative session violated the Contracts Clause of the Constitution, which prohibits states from enacting laws that interfere with existing contracts, and the Takings Clause, which bars the taking of private property for public use without just compensation.

The company further argued that the federal law outlining the 340B program preempts state law, particularly a provision in Senate Bill 071 that prohibits a manufacturer from requiring a health care provider to submit health information, claims or utilization data – or any other data unrelated to a claim to federal health care programs unless required by federal law.

Additionally, the company argued SB 071 is preempted by federal patent law because it “diminishes the rewards to patentees by capping the price at which patented drugs may be sold.”

On behalf of the state, Attorney General Phil Weiser argued that AstraZeneca lacked legal standing to bring the case because the damages the company claims it will suffer as a result of the law are “not fairly traceable” to SB 071.

Chief Judge Philip Brimmerm of the U.S. District Court for the District of Colorado found that AstraZeneca had standing to bring the lawsuit but argued that the company’s requested injunction would not materially affect its revenue.

Brimmer concluded that SB 071 was not preempted by the federal 340B program, referencing a challenge to similar legislation in Arkansas, in which the court found that the law “does not create an obstacle for pharmaceutical manufacturers to comply with 340B, instead it does the opposite: [the statute] assists in fulfilling the purpose of 340B.”

“S.B. 71 does not interfere with Section 340B’s objectives, but instead helps to achieve them,” Brimmer added.

Additionally, Brimmer said, AstraZeneca’s argument that SB 071 places caps on the price of patented drugs is false, as the federal 340B law is responsible for that.