For a sense of the challenges confronting our program, look no further than pharmacy chain Walgreens, which plans to temporarily carve out 340B rebates along with all 10 drugs subject to Medicare Part D price negotiations starting Dec. 23. Contract pharmacies have quietly fretted about how to operationalize 340B rebates; will more follow Walgreens’ example?
We recently hosted a meeting at The Craneware Group with a small group of program stakeholders to discuss 340B rebate preparations, which gave me a sense of how customers are feeling as the pilot’s Jan. 1, 2026 start date approaches.
They’re not feeling great.
There’s still a ton of ambiguity, and few covered entities said they considered themselves ready operationally. Many expressed hope the government might delay implementation to give them more time to prepare.
Among other things, there was widespread concern over information security on the Beacon data-submission platform. While the company insists its platform is secure, covered entities would like to see it adhere to the same HITRUST and SOC 2 standards their organizations meet.
Covered entities would also like clarity over whether contract pharmacy restrictions, which persist because courts have determined that HRSA lacks authority on the issue, will apply under the rebate program. Because HHS Secretary Robert F. Kennedy Jr. approved 340B rebates, he should similarly dictate terms on use of contract pharmacies within the pilot.
This barely scratches the surface of the complexity that starts in January. All told, large 340B hospitals will have their hands full running six different pharmacy components: the regular program, Beacon for the rebates, contract pharmacy data submission using 340B ESP and now Truzo (more on that in a moment), the normal hospital pharmacy business, and Part D maximum fair pricing for those with an in-house prescription pharmacy.
One 340B administrator told me they may need to hire two new people just to keep all these balls in the air. So much for HRSA’s assertion that manufacturers would bear the costs of the rebate pilot.
And so much for hospitals being able to give undivided attention to their safety net missions.
Meanwhile, more 340B rebate developments:
- HRSA approved Novartis’ 340B rebate plan for Entresto, which goes into effect April 1, 2026.
- The agency clarified that referrals will be eligible and counted under the 340B rebate pilots, clearing up earlier confusion.
- A Washington D.C. appeals court panel heard arguments in the original rebates lawsuit brought by four manufacturers and Kalderos, who are appealing lower court rulings that said HHS must first approve such schemes.
In a development to watch, AstraZeneca is suing Vermont over its contract pharmacy access law, adding that it conflicts with the federal 340B rebates pilot program because it prohibits the collecting of claims data. While it’s the second lawsuit targeting the state law, it’s the first to be filed since HRSA approved rebate pilot programs, including AstraZeneca’s plan for its drug Farxiga.
The rebate program could open a new front in the drug industry’s challenge against state contract pharmacy access laws. In denying AbbVie’s motion to block enforcement of Colorado’s law, a federal judge argued that statute did not conflict with the rebates pilot because it made an exception for data required under federal law.
Contract pharmacy news
As mentioned above, there’s a new claims-submission platform on the scene: Truzo, from drug-industry vendor Kalderos. Ireland-based Alkermes announced it will require covered entities to begin using Truzo to submit contract pharmacy claims starting Dec. 1 — a ridiculous time frame. Kalderos, which has been shopping for a real-life use case for its products for years, is hinting that more drugmakers will soon flee 340B ESP for their platform — which again, just adds complexity for covered entities.
Elsewhere, Oklahoma’s contract pharmacy access law has come under scrutiny. After a federal judge issued a preliminary injunction blocking enforcement of the law, the state’s attorney general filed a motion contesting it in the 10th Circuit Court of Appeals.
Other 340B developments
- They’re at it again: The Pharmaceutical Research and Manufacturers of America (PhRMA) trade group has released another 30-second ad alleging that 340B hospitals and pharmacy benefit managers engage in “middlemen markups” of drugs. The ad touts a new direct-to-consumer sales platform and investment in U.S. manufacturing — things the Trump administration effectively pressured the industry into.
- CMS released its final 2006 Hospital Outpatient Prospective Payment System rule, which will include a Medicare drug-acquisition survey, a likely precursor to a renewed attempt to slash Part B reimbursements to hospitals. It will also increase OPPS cuts from .5% to 2% annually, reduce the clawback period from 16 years to six, and delay implementation to 2027, from 2026, to offset lump-sum repayments to 340B hospitals related to a 2022 Supreme Court ruling.
- CMS has finalized its plans to create a federal 340B claims repository for Medicare Part D starting Jan. 1. Participation is voluntary but is supposed to help the government exclude 340B claims from calculating Part D inflation rebates. CMS says it could eventually make participation mandatory.
- Four insulin manufacturers are asking a federal appeals court to reconsider its recent decision to vacate a lower court’s decision denying a class-action antitrust lawsuit. The case stems from a lawsuit claiming the companies colluded to restrict access to contract pharmacies.
- In a bit of good news, former U.S. Rep. Abigail Spanberger, an ardent 340B supporter, won the Nov. 4 gubernatorial election in Virginia. She will succeed Glenn Youngkin, who vetoed a contract pharmacy access bill, giving lift to hopes the Old Dominion may yet add its name to the ranks of states with strong 340B protections.
In these stressful times, we’ve got to stay united, work together and keep focused on the mission of providing a strong healthcare safety net. Stay strong!
If you’d like to continue this conversation, please contact me at [email protected].