April 2, 2015—The Health Resources and Services Administration has removed three drugmakers from its list of those that do not provide 340B pricing on orphan drugs to rural and cancer hospitals. [ms-protect-content id=”2799″]
Baxter, GlaxoSmithKline, and Salix Pharmaceuticals came off the list when it was updated on March 19. The 10 still on it are:
- AuroMedics Pharma LLC
- Bayer AG
- Eisai Co., Ltd.
- Eli Lilly and Company
- Genentech Inc.
- Ipsen
- Novartis International AG
- Pfizer, Inc.
- Roche
- Virtus Pharmaceuticals, LLC
HRSA posted the original list in February after multiple rural and cancer hospitals reported they could not get 340B pricing on orphan drugs when they used the drugs for common conditions. Last July, HRSA published an interpretive rule stating that the 340B statute requires manufacturers to provide 340B discounts under those circumstances. Pharmaceutical Research and Manufacturers of America is challenging HRSA’s interpretation in court.
Speaking at IIR’s Government Programs Summit in Arlington, Va., on March 25, OPA Director Cmdr. Krista Pedley explained that OPA took Baxter, GSK, and Salix off the list after verifying that they were, in fact, offering rural and cancer hospitals 340B pricing for their drugs with orphan designations when the drugs were used for non-orphan indications.
Pedley said that after HRSA published the list, “we heard from manufacturers that … they actually were offering” 340B pricing. “A lot of [the problem] was wholesaler miscommunication about whether pricing was being offered or not,” she said. After working with the drugmakers and the 340B prime vendor, Apexus, to verify the drugmakers’ information, HRSA took their names off the list. “We will continue to update that information so states can have the information they need to get [Medicaid] rebates,” she said.
The 340B statute protects drug manufacturers from supplying both a Medicaid rebate and a 340B discount on the same drug. If manufacturers do not provide a 340B discount on a drug, there is no risk of a 340B discount, HRSA has pointed out. When HRSA released the list in February, it said its purpose was to inform states that rebates were available on these manufacturers’ orphan products.
Pedley said the Centers for Medicare and Medicaid Services is drafting a Medicaid program release to the states to let them know about HRSA’s orphan drug manufacturers list and the opportunity to seek rebates on non-340B-discounted drugs.
John Coster, Director of the Division of Pharmacy within CMS’s Disabled and Elderly Health Programs Group, also spoke at the conference. “We’re concerned that states should get rebates on those drugs if covered entities aren’t getting those discounts,” he said. “Medicaid is covering those drugs, they’re covered outpatient drugs, and they should be subject to rebates if they’re not subject to the 340B discount.” [/ms-protect-content]