Six Drug Companies Face Steep Fines for Ignoring 340B Rules
Updated: Nov 2, 2021
Want to learn about the moves HRSA is making to defend 340B rules? If your answer is “yes,” you’re in the right place.
In May 2021, Diana Espinosa, HRSA’s Acting Administrator, sent letters to six drug companies... stating that cutting off 340B savings violated 340B rules.
The names of the companies who received these letters include:
The letters the HRSA issued urged the companies to reinstate 340B discounts immediately... or be subject to civil monetary penalties (CMPs).
How did the drug companies respond?
Eli Lilly fired back by filing a motion to avoid any adverse action until the court resolves the issues with their lawsuit against HRSA. While other manufacturers, including AstraZeneca, filed lawsuits against the May HRSA letter… and the Advisory Opinion, the HRSA issued at the end of 2020.
In response, HRSA withdrew its Advisory Opinion. They emphasized that their plan to enforce the violation letters issued in May still stands.
The HRSA also stated that the Advisory Opinion was independent of the enforcement letters they issued.
In September 2021, HRSA referred the six drug companies to the HHS Office of Inspector General… to enforce penalties for violating the 340B rules.
The HHS could charge drug companies more than $5,000 per violation after fines are finalized. The Biden administration has also made moves to penalize these drug companies.
In fact, Maureen Testoni, 340B Health President and CEO, said, “Despite unequivocal determinations from the government that these drugmaker actions are unlawful, the companies continue to ignore federal law and refuse to offer 340B pricing on drugs dispensed at community pharmacies […] the longer these drugmakers refuse to follow the law, to stop overcharging for 340B drugs, and to repay the denied savings, the greater the harm will be to patient care.”
The drug makers’ plan involves only providing discounts to Medicare and Medicaid patients. Their main complaint is: the program is too large, and they don't see the benefit to patients.
The truth is that most covered entities, like yours, need their 340B savings to run a successful program.
That said, we’ll keep you updated on any recent changes to the program. For now, let’s get to the information you’re here for, and that’s how to protect your program for the long haul.
Here are five ways to avoid financial losses and disruptions to your workflow.
Keep OPA database information accurate and up-to-date
Renew your eligibility each year
Avoid selling discounted drugs to ineligible patients
Follow your state’s Medicaid rules to prevent duplicate discounts
Conduct monthly self-audits or get third party experts to audit your program
Do you have any questions? Reach out at Lyssa@optimal340B.com.