refusing to ship covered outpatient drugs to a pharmacy or location identified by a covered entity. (8) Section 340B’s inflationary penalty provisions, which have saved $7 billion in Medicare Part D spending between 2013 and 2017, have a proven record of reducing drug price increases, and use of 340B in contract pharmacies contributes to these savings. (9) Specialty drugs, which are often used to treat chronic, serious, or life-threatening conditions such as cancer, rheumatoid arthritis, growth hormone deficiency, and multiple sclerosis, play a critical role in the care provided by covered entities. These drugs often require specialized handling, are not usually available to walk-in customers, and are typically available only through specialty or mail order pharmacies that are located hundreds of miles from a covered entity. The use of contract pharmacy arrangements under Section 340B are often the only means by which covered entities can access these vital drugs. (b) Purposes The purposes of this Act are the following: (1) To clarify that section 340B of the Public Health Service Act ( 42 U.S.C. 256b ) requires drug manufacturers to offer 340B pricing for drugs purchased by a covered entity regardless of the manner or location in which the drug is dispensed, and section 340B prohibits drug manufacturers from placing conditions on the ability of covered entities to purchase and use 340B drugs, regardless of the manner or location in which they are dispensed. (2) To clarify that covered entities under section 340B may contract with pharmacies to dispense on a covered entity’s behalf drugs purchased by a covered entity under section 340B to generate savings to assist covered entities to stretch resources to provide care to more patients and provide more comprehensive services, and the requirements and prohibitions that apply to manufacturers under section 340B apply in the case of a covered entity that elects to contract with a pharmacy to dispense 340B drugs. 3. Ensuring the accessibility of drugs furnished under