New guidance from HHS has clarified that hospitals and other covered entities in the 340B Drug Pricing Program are entitled to discounts for covered outpatient drugs even if they use contract pharmacies to distribute the drugs to patients.
- The guidance comes after five national hospital organizations, including the American Hospital Association, and the leading hospital pharmacist organization filed a lawsuit against HHS after the department failed to address the refusal of several major drug manufacturers to discount the prices of covered outpatient drugs because hospitals used contract pharmacies.
- The groups alleged that Eli Lilly, AstraZeneca, Sanofi, Novartis, Merck & Co., United Therapeutics, and other drug manufacturers unlawfully refused to provide discounts to hospitals and other providers that serve vulnerable patients through the program.
- HHS’ Office of General Counsel states in the new guidance document that drug manufacturers must not charge more than the 340B ceiling price – or the maximum amount a manufacturer can charge a covered entity for the purchase of a covered outpatient drug – regardless of how the hospital or any other purchaser in the program distributes the drug.
- Rick Pollack, President and CEO of the AHA stated, “The 340B program plays a critical role in helping eligible hospitals provide a wide range of comprehensive services and low-cost drugs to vulnerable patients and communities, many of which have been the hardest hit by the COVID-19 pandemic.”
- The 340B Drug Pricing Program was designed to help organizations serving a disproportionate number of disadvantaged and low-income patient populations to stretch federal resources as far as possible to provide more comprehensive services.