Having worked in 340B for more than two decades, it’s remarkable to see our safety net drug program, which once flew well under the radar, become so prominent in the national spotlight. It wasn’t long ago that many who worked in healthcare had never heard of 340B. Today, it earns steady coverage, both good and bad.
So was the case in June, when a House Energy & Commerce subcommittee hosted testimony on how to limit perceived abuses in the program and boost federal oversight. The testimony touched on the growth of the program over time, allegations that 340B creates “misaligned incentives” and, of course, calls for greater transparency from covered entities.
The hearing generated plenty of coverage from the political and healthcare trade press, coming at a time when multiple 340B bills have been introduced or are in the works (more on those in a moment). Yet the big takeaway is encouraging: Even the biggest proponents of making changes to 340B acknowledge the program’s important role in safety net healthcare.
“There are many hospitals, including those in my district, who I believe are appropriately using 340B dollars in order to keep their doors open and they heavily rely on this program,” Rep. Morgan Griffith (R-Va.), the subcommittee chair, said. “I am a supporter of the overall concepts of the 340B program.”
Matthew Perry, president and CEO of Genesis HealthCare System in Zanesville, Ohio, said the organization’s roughly $56 million in annual program benefits are critical to offsetting underpayments from government health programs.
“In the absence of 340B, our organization doesn’t work,” Perry said. “It’s just that simple. We are out of business.”
One of the aforementioned bills, the pharma-friendly 340B ACCESS Act (which we discussed last month), formed a backdrop to the hearing in the Republican-controlled Oversight and Investigations subcommittee. Despite being strong supporters of the 340B program, two organizations representing grantee clinics — Advocates for Community Health and Ryan White Clinics for 340B Access — have expressed deep concern about the bill because many of the provisions would significantly restrict community health centers ability to leverage the 340B program to provide care for patients. (NACHC also recently sent an email asking members what they thought about the bill, which is strange to do after it has already been introduced.)
Another, the SUSTAIN 340B Act, from the bipartisan Senate “Gang of Six,” could be introduced before the August recess, per 340B Report — though it’s worth noting an earlier floated deadline has come and gone. In the same chamber, Sen. Gary Peters (D-Mich.) introduced S.4587, a companion to a House bill that would extend 340B eligibility to rural emergency hospitals, a new designation meant to help facilities at risk of closure.
Whether any of these can gain traction in a contentious election year remains to be seen.
There are fibs and there are outright lies
The anti-340B dark money groups are at it again with outright lies. Stand For Us PAC released another new 30-second ad conflating 340B with “free healthcare” for illegal immigrants paid for with tax dollars, adding that politicians who support the program will “pay the price” at the polls. It specifically mentions West Virginia Senate President Craig Blair, who lost in a Republican primary election in May after attacks from the shadowy organization.
Blair responded by penning an op-ed headlined, “‘Big Pharma’ is using West Virginia to scare GOP supporters of 340B pharmacies.”
“Big pharmaceutical companies hate this program because it cuts into their enormous profits,” he wrote. “Because I defended it, an organization with ties to Big Pharma spent money opposing me and now they are trying to take a victory lap and scare other Republicans into abandoning their support for this program. They are wrong, and my fellow Republicans should not listen.”
Blair told 340B Report he is considering taking legal action against the group, which he contends violated state laws.
Lawsuits and other shenanigans
While more and more drugmakers are lifting their contract pharmacy restrictions in the seven states that have enacted laws protecting them, the industry continues to use its considerable resources to fight back.
The Pharmaceutical Research and Manufacturers of America, or PhRMA, has sued to stop new 340B contract pharmacy state laws in both Mississippi and West Virginia, as has Novartis, which also has a similar lawsuit in place in Maryland.
Meanwhile, Eli Lilly, the company that kicked off all this madness back in 2020, is out with a set of egregious new restrictions. Citing “serious issues” with 340B contract pharmacies, including “thousands of duplicate Medicaid discounts,” the drugmaker will require covered entities that don’t have an in-house or wholly owned pharmacy to designate a single contract retail location and upload claims data to 340B ESP, but that’s not all. Lilly says it will allow access to penny-priced insulin at an unlimited number of contract pharmacies — provided the covered entity agrees to pass along all the savings to the patient, doesn’t bill any health plan or charge for a dispensing fee, and submits claims data. Essentially, it’s a bid to eliminate 340B spread pricing.
And finally, in a dubious milestone, it’s now an even three dozen, as Swedish drugmaker Sobi, Bausch + Lomb and Irish manufacturer Alkermes became the 34th, 35th and 36th companies, respectively, to announce new contract pharmacy restrictions.
Obviously, there will be plenty to talk about at 340B Coalition Summer Conference in early July. Visit with The Craneware Group in booth 601.
If you'd like to continue the conversation with me, please contact me at [email protected].