Things always seem to get busier in these late months when the leaves are falling, and that certainly rings true again this year. Since last month’s dispatch, when Congress narrowly managed to avert a government shutdown, House Republicans gave the boot to their leader, rejected three others who sought to replace him, and finally settled on Rep. Mike Johnson, a previously low-profile member from northwest Louisiana, as their new Speaker.

While plenty is being written about Johnson’s background and conservative views, his track record on healthcare is limited. He signed on as a co-sponsor of a bill in 2017 that sought to block the nearly 30% Medicare Part B reimbursement cut to 340B hospitals later declared illegal, and encouragingly, per 340B Report, one of his largest campaign donors is a health system participating in 340B based in Shreveport.

He'll have a short honeymoon. Funding for the government runs out again later this month. Johnson says he’s committed to avoiding a shutdown, and we’re told that leadership is considering another temporary extension that would last until either January or April, depending on how many appropriations bills he can get through the House in the next few weeks. There are also plenty of bills percolating in the House that would subject covered entities to varying levels of reporting requirements. Stay tuned.

Pandemic exemption to end

The federal government said on Oct. 27 it is rolling back a COVID-era waiver for offsite outpatient child sites. HRSA introduced the flexibilities during the COVID outbreak in June 2020, and the agency — apparently mistakenly — told 340B Report the changes would be permanent.

It could be a big deal for many 340B hospitals with large networks of outpatient facilities. In a statement, the trade group America’s Essential Hospitals said the waiver “corrected a longstanding barrier to access by allowing hospitals to use 340B drugs at offsite outpatient locations as soon as they began serving patients” and will harm hospitals and patients.

For now, HRSA is offering two options and a 90-day grace period for covered entities dispensing 340B drugs at unregistered child sites, so long as those sites appear on their parent’s Medicare Cost Report and are registered in the Office of Pharmacy Affairs Information System (OPAIS).

Pandemic exemption to end

There’s more operational hopscotch for entities that use contract pharmacies.

Japanese drugmaker Eisai became the 27th manufacturer to announce contract pharmacy restrictions. It’s offering entities the choice of an in-house location or a single designated site — though not in Arkansas or Louisiana, the two states that have enacted laws prohibiting such manufacturer meddling. Eisai joins the likes of Merck, Teva, and now Astellas and GlaxoSmithKline, both of which in October lifted their contract pharmacy policies in the two states.

As we recently wrote, Arkansas became the first state to enforce its law. Novo Nordisk is now suing the state, which slapped it with a fine of $100,000, in federal court.

Just south of the state line, AbbVie joined the ranks of drug companies and groups filing suit in federal court alleging that Louisiana’s state law is unconstitutional and preempted by federal statute. The Pharmaceutical Research and Manufacturers of America (PhRMA) and AstraZeneca have also sued to stop the law.

Meanwhile, several manufacturers have updated their contract pharmacy policies:

  • Bristol Myers Squibb said it will include grantees in its restrictions and end an exemption for hospitals’ wholly owned pharmacies. In an interesting twist, BMS added language targeting the self-distribution model some hospitals have employed to send drugs purchased under 340B to contact pharmacies to get around the manufacturer limitations.
  • GlaxoSmithKline added the anemia medication Jesduvroq to its contract pharmacy restrictions.
  • Pfizer added 15 more drugs, effective Nov. 1, but will continue to exempt grantees.
  • Teva added Austedo, a drug that treats Huntington’s disease, to its restrictions.

Many companies continue to drop their requirement to submit claims data to look for duplicate discounts. It’s further evidence, as we  recently wrote in a 340B Matters post, that the claims data issue was a ruse all along.

New reform group

A new 340B reform group that includes drug manufacturer Genentech is adding members as it lobbies in favor of the bipartisan “gang of six” senators, who solicited feedback on how to reform the program earlier this year and garnered nearly 270 responses. Tom Mirga at 340B Report spotted a lobbying filing from the group, which calls itself 340B Working Table. It reported spending $110,000 in the latest quarter and adding new members, including five health systems and three health centers. It’s a rare example of a drugmaker working alongside 340B providers and allies.

New ADR nearly complete

We are close to getting, at long last, a new administrative dispute resolution (ADR) rule as promised a year ago by the Biden administration. The final rule would give HRSA’s Office of Pharmacy Affairs the lone votes on ADR panels, but there is no timetable for when the rule will be released.

Medicare price negotiations move forward

Also of note in October was the announcement by the Biden administration that all 10 drugmakers whose drugs CMS picked for the first round of price negotiation for Medicare have agreed to participate. Several of the manufacturers have previously filed suit to stop the program, and a federal judge in late September declined a request by the U.S. Chamber of Commerce to halt the negotiations.

340B benefits bump

Finally, a bit of good news: In a new report, the American Hospital Association says community benefits provided by the nation’s 1,614 nonprofit 340B hospitals saw a 24% bump in 2020 to $84.4 billion, an increase of $16.5 billion in a year marked by the onset of the COVID-19 pandemic.

Now that House Republicans finally have their new speaker, the work of Congress resumes, for better or worse. It figures to be a busy Q4 of 2023, so let’s get to work. Contact your congressional members and let them know what 340B means to your community.