AstraZeneca, Novo Nordisk and Sanofi score 340B-related appeals court win over HHS
AstraZeneca, Novo Nordisk, and Sanofi won an appeals court win on Monday, as the US Court of Appeals for the Third Circuit found that the companies cannot be forced to provide 340B-discounted drugs purchased by hospitals from an unlimited number of community and specialty pharmacies.
“Legal duties do not spring from silence,” the decision says as the court makes clear that the federal government’s interpretation of the “supposed requirement” that the 340B program compels drugmakers to supply their discounted drugs to an unlimited number of contract pharmacies is not correct, noting:
Drug makers often comply by limiting distribution to a few pharmacies that are specially trained to educate and monitor patients. The government now says that such limits are illegal under Section 340B. Perhaps there is a costly, complex way to comply with both requirements, but this tension is another strike against the government’s reading.
Under Section 340B, drug makers that take part in Medicare or Medicaid must offer their drugs at a steep discount for certain low-income patients. But in recent years hospitals have added an increasing number of pharmacies requiring 340B prices, forcing the market to balloon to 15% of US pharma sales in 2021, according to IQVIA.
Hospital association 340B Health President and CEO Maureen Testoni said in an emailed statement: “We respectfully disagree with the Third Circuit’s decision that drug companies are not required to offer 340B discounts through all community and specialty pharmacy partners… We await decisions from the other two appeals courts on this crucial issue, and we urge the Biden administration to continue a strong defense of its interpretation of the 340B law.”