July 14, 2015—The federal government’s first 340B program audit of a drug manufacturer will not be made available to the public, the deputy director of the Health Resources and Services Administration Office of Pharmacy Affairs said yesterday.[ms-protect-content id=”2799″]
Speaking on the first day of the 340B Coalition summer conference in Washington, OPA Deputy Director Michelle Herzog said the audit, which HRSA conducted jointly with the Department of Health and Human Services Office of Inspector General, was completed last year. “I will tell you it is an OIG restricted report, so it will not be available to you as the public,” she said. “However, we at HRSA and OPA are working on developing a protocol for manufacturer audits, and we hope to conduct our own here soon in [fiscal year] 2015.”
The OIG office of public affairs has not yet responded to a request made late yesterday afternoon for background information on reasons why it would restrict access to reports. A HRSA spokesperson said today that “HRSA cannot comment on issues involving the Office of the Inspector General.”
Earlier in her remarks, Herzog reported that HRSA has audited about 135 healthcare providers for 340B program compliance so far this fiscal year and is on track to perform a total of 200 by the end of September, when fiscal 2015 ends. HRSA has conducted more than 363 onsite audits of covered entities since 2012, encompassing more than 4,000 offsite facilities and more than 9,000 contract pharmacies, she said. “So that’s a far reach into the program for us,” she noted.
HRSA makes summaries of 340B covered entity audit findings, sanctions (if any), and corrective action plans (if any) accessible from the OPA website’s home page. The most recent updates were posted on June 26.
“We encourage all covered entities to be preparing constantly for an audit,” Herzog said. “You can be selected at any time. I can’t stress enough that you, the covered entity, are always responsible for compliance at your site. It doesn’t matter if you hire 500 vendors. It all comes back to the covered entity, and it’s where we would go back if we expect restitution to any manufacturers if necessary.”
Other Topics
Herzog also touched on the following topics during her remarks:
- “At a later time this year,” HRSA will publish a proposed regulation to establish a mandatory 340B dispute resolution process, Herzog said. The proposed rule is “in the very early stages and we don’t have much to say on that at this point,” she said.
- HRSA’s omnibus 340B program guidance is still under White House Office of Management and Budget review. “It’s pretty much going to touch on everything else in the program” not addressed by either the dispute resolution regulation or the manufacturer civil monetary penalties and ceiling price calculation regulation that is currently available for public comment, she said. Herzog specifically cited “patient definition, contract pharmacy, covered outpatient drugs, audits, manufacturer limited distribution, [and] refunds and credits.”
- HRSA is “diligently working” on the congressionally mandated system it is developing to calculate and verify 340B ceiling prices and then let participating healthcare providers see the prices on a secure website.
- On a related topic, Herzog said OPA has given some thought to requiring drug manufacturers to update their profiles in the 340B database periodically. She noted that OPA has “pushed out numerous communications” to manufacturers in recent months to update their information in the database “because that’s going to aid the pricing system…we’re going to have to issue credentials to manufacturers as well as the covered entities.”
- HRSA continues to improve the 340B Medicaid exclusion file and is “looking at how we can alert manufacturers to changes that are made in the file during a quarter,” she said.
- Herzog was asked whether HRSA is investigating any complaints about manufacturers being unwilling to sell drugs to covered entities that have entered into 340B contract pharmacy arrangements with specialty pharmacies. “We do take every allegation seriously…and we are willing to work with covered entities and manufacturers to ensure that 340B participants are having access to drugs when they need them.”
- Herzog said HRSA is meeting with the Food and Drug Administration shortly to discuss the new prescription drug track-and-trace law’s implications for 340B contract pharmacy.
- Asked whether HRSA would consider returning covered entities’ second opportunity to respond to an unfavorable audit finding, Herzog said HRSA “is always looking at how we can improve the audit process.”[/ms-protect-content]