In what has become an annual tradition for the podcast, we consulted with 340B Health’s expert staff to answer our listeners’ most pressing 340B questions. As an uncertain and busy year starts for the world of 340B, we want to prepare you by covering your queries about the efforts by drug companies to impose 340B rebates, proposed federal and state legislation on 340B, how Inflation Reduction Act implementation will affect 340B, and more.

340B Rebate Lawsuits Heat Up

So far, five drug companies have sued the Health Resources & Services Administration to challenge HRSA’s rejections of their backend rebate proposals. 340B Health Vice President of Legal and Policy Amanda Nagrotsky notes that a rebate model would harm 340B hospitals through delayed access to 340B savings and potentially denials of legitimate rebate claims based on drugmaker interpretations of 340B rules. We recorded this episode just before 340B Health filed a motion to intervene as a defendant in the Johnson & Johnson (J&J) rebate lawsuit against HRSA.

Lawmakers Eye Ways To Protect or Cut 340B

The new year means a new Congress and the start of new state legislative sessions. 340B Health Senior Vice President of Government Relations Tom O’Donnell notes that members of Congress have floated potential reductions in what the federal government pays for 340B drugs to help fund new spending priorities outside of health care, though it is unclear how seriously they are considering those options. 340B Health Vice President of Legal and Policy Greg Doggett reports that several states are considering new contract pharmacy or payment nondiscrimination protections for 340B hospitals, but others have introduced proposed new mandates for covered entities. 

Price Caps Will Apply to More Medicare Drugs

The list of drugs eligible for Medicare price caps will grow to 25 starting in 2027 under the Inflation Reduction Act, which will have implications for 340B savings on those drugs. 340B Health Research and Policy Analytics Manager Claudia Escue notes that popular weight loss and diabetes drugs like Ozempic and Wegovy have made the price cap list because of how much they cost Medicare. 340B Health is tracking how these price caps might lower 340B savings and have submitted letters to Medicare officials to represent other hospital concerns about the implementation of the IRA.

Resources:

1. 340B Health Files Motion To Intervene in J&J Rebate Lawsuit
2. Option To Cut Commercial Pay Rates for 340B Drugs Is on Draft Congressional Budget “Menu”
3. Medicare Expands List of Drugs Subject to Price Caps, Decreased 340B Savings
4. 340B Coalition Winter Conference Registration