AbbVie Inc., Amgen Inc., and Bristol Myers Squibb are among the latest companies to limit the discounts they offer through the government’s 340B Program. The 340B Program is a federal program that requires drug manufacturers that participate in Medicaid and Medicare Part B to provide covered entities with outpatient drugs at significantly reduced prices. Eligible health care organizations/covered entities include HRSA-supported health centers and look-alikes, Ryan White clinics, State AIDS Drug Assistance programs, Medicare/Medicaid Disproportionate Share Hospitals, children’s hospitals, and other safety net providers. Eligible providers must enroll in the program and comply with all its requirements. In recent months, federal courts have handed down conflicting rulings regarding the government’s ability to force manufacturers to provide these discounts.
More than a dozen manufacturers have limited for-profit pharmacies from receiving the discounts so far, and both the Biden administration and drug manufacturers have appeals pending. Given that there are several appeals pending, it could take months before the courts provide a resolution to the question of manufacturers’ obligations under the 340B statute.