As more and more states sign laws protecting 340B contract pharmacy access, covered entities in these states are once again receiving the full benefits of the program.
But for those in other states, the question must be asked: When will Congress step up and act at the federal level to protect the 340B program that they created? After all, Congress is the parent in this case, the institution that instituted the original 340B statute. It alone can put so much of this never-ending dispute to rest.
There are now four states that have enacted laws preserving 340B access to contract pharmacies, after Mississippi Gov. Tate Reeves, a Republican, signed a standalone bill, bringing the state in line with Arkansas, Louisiana and West Virginia. Lawmakers in Maryland have sent a similar bill to Gov. Wes Moore.
The situation is more complicated in Kansas, where Gov. Laura Kelly, a Democrat, had signed a budget bill in April containing the protections. But lawmakers then passed an omnibus spending bill that would prevent the contract pharmacy provision from taking effect until the U.S. Supreme Court rules on the matter — which of course it currently has no plans to do. The move sends the matter back to Kelly, who has 10 days to restore the protection via a line-item veto.
At any rate, the pressure from states and covered entities may be working.
Recently, U.S. Sen. John Thune, a South Dakota Republican and a member of the so-called “Gang of Six” (or “G6,” as a colleague recently referred to them) who are pushing the SUSTAIN 340B Act, told a gathering of the American Hospital Association that 340B reform may pass Congress by the end of the year as part of larger healthcare package, including PBM reforms. Thune, who is the No. 2 Republican in the chamber as the Senate minority whip, later told Axios that actual legislation could come as early as this month. (Of note, Sen. Thune is also vying to replace retiring Sen. Mitch McConnell as the Senate Republican leader.)
Speaking of SUSTAIN 340B, 340B Report got ahold of the RFI comments submitted by several key interest groups. Hospital groups, the publication wrote, generally favor keeping the traditional, 1996 definition of patient, while drug industry respondents recommended greater specificity in defining eligibility. Respondents also differed on proposals to require entities to pass along their discounts directly to patients on a sliding scale and on reporting requirements.
For our part, The Craneware Group recommended deferring to safety-net providers in shaping the patient definition and suggested a time limit, if deemed necessary, of at least one year from the prescribing event. You can read our comments here.
Playing politics
One state that won’t see a new contract pharmacy access law — at least not yet — is Virginia, where Republican Gov. Glenn Youngkin kicked the can down the road by adding an amendment to a bill that would delay enactment for a year, require lawmakers to again vote to approve it and add new reporting and oversight measures. This after the bill sailed through both chambers of the General Assembly with overwhelming support.
A spokesman for Youngkin said the governor was concerned that 340B “could be exploited to provide taxpayer subsidized healthcare to illegal immigrants.” That’s a reference to a campaign by a dark-money group called Building America’s Future that is trying to link 340B with hot-button border politics. And it’s a complete lie, because 340B has never been funded by taxpayer dollars.
Unfortunately, these attacks from far-right groups may be proliferating. An organization called the American Free Enterprise Chamber of Commerce is out with a new video lambasting 340B as a “flawed government program” that is driving up healthcare costs for small businesses and enriching “for-profit healthcare middlemen.” And Building America’s Future is urging Republicans in other states to reject bills protecting contract pharmacy access — this despite strong 340B support from plenty of GOP governors.
New ADR
At long last, the Biden administration has issued its final rule implementing the new 340B administrative dispute resolution process, which takes effect in June. Here’s a good, detailed summary, and the gist is that the process becomes more administrative and less like a trial to make it more accessible to smaller covered entities with fewer resources, with the panel made up of 340B experts from HRSA’s Office of Pharmacy Affairs.
“We are particularly encouraged by the final rule clarifying that a covered entity’s ADR claims can include accusations that a drug company has limited the ability to purchase drugs at or below the 340B ceiling price and removing a proposed amendment to block ADR consideration of a claim similar to an issue pending in federal court,” Maureen Testoni, president and CEO of 340B Health, said in a statement. “HRSA’s removal of potential conflicts of interest and unnecessary legal barriers are additional positive steps that will simplify and streamline the dispute resolution process for the benefit of all participants.”
Meet the new boss
HRSA’s Office of Pharmacy Affairs acting director, Chantelle Britton, is now officially director, which we interpret as good news for 340B.
Despite not being a pharmacist, Britton is highly knowledgeable. She started at Health and Human Services in 2006 and served in the Obama administration as a policy advisor in the Office of National AIDS Policy, and she also worked on the Domestic Policy Council health team on Medicaid and low-income health policy and as a legislative analyst with CMS. She also served eight years as senior advisor in the Office of the Director of OPA.
Also newsworthy
- Genentech and Sumimoto became the 31st and 32nd drugmakers, respectively, to announce contract pharmacy restrictions.
- AbbVie, Astellas, Merck and Teva made updates to their restrictions.
- Oregon Gov. Tina Kotek signed a law prohibiting PBMs from discriminating against 340B entities.
Per 340B Report, state regulators in Maine have proposed adding new requirements — and fines for non-compliance — to the state’s new 340B reporting law, which was signed last year. Under the proposed rule, hospitals would have to report the name, acquisition cost and amount of 340B savings for their three costliest drugs purchased under the program as well as for their most commonly prescribed 340B drugs. They would also face fines as high as $1,000 per day. While reports from 340B hospitals are due by Dec. 1 each year, it’s not clear when a final rule will be issued.
Reasons to be thankful
On a personal note, The Craneware Group just marked its 25th anniversary, complete with a modest celebration at our corporate headquarters in Edinburgh, Scotland and by opening our new U.S. headquarters in Deerfield Beach, Fla.
Many businesses don’t make it to 25 years, and I feel lucky and grateful to work for an organization that’s doing the right thing for our customers and for the patients and communities they’re able to help.