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SANOFI SUES HRSA AFTER 340B REBATE MODEL WARNING
Alexandra Murphy - yesterday
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Sanofi filed a lawsuit against the Health Resources and Services Administration
in federal court Dec. 16, challenging the agency's decision to potentially
remove the company from the 340B Drug Pricing Program over the company's
proposed credit model.
"Sanofi has long advocated for changes to the 340B Program, which has been
plagued by insufficient HRSA oversight and well-documented misuse," the company
said in a Dec. 17 statement sent to Becker's. "The 340B Credit Model would
introduce the necessary transparency to curb this, including by preventing
duplicate discounts and diversion, and ultimately helping to return integrity to
the 340B Program."
The drugmaker said it plans to pause implementation of its 340B Credit Model
while seeking legal resolution.
Sanofi's legal action comes several days after HRSA sent a warning to the
pharmaceutical company's CEO Paul Hudson. The letter states that the drugmaker's
plans to implement a credit model starting Jan. 6 would violate the 340B statute
by requiring certain covered entities — such as disproportionate share, critical
access hospitals and rural referral centers — to purchase drugs at prices above
the statutory ceiling.
According to HRSA, Sanofi's proposal would force covered entities to order drugs
at Wholesaler Acquisition Cost and then seek a credit from Sanofi for the
difference between WAC and the 340B price. The agency argues that this model —
which Sanofi has announced without approval from the HHS secretary — would
violate the legal requirement that manufacturers offer covered outpatient drugs
at or below the ceiling price set by 340B.
The agency requested that Sanofi cease the implementation of its credit model
immediately and notify HRSA by Dec. 20 of its decision.
Sanofi's legal challenge follows a pattern of pharmaceutical companies
contesting the authority and changes to 340B participation rules. Bristol Myers
Squibb filed a lawsuit against HHS in late November, arguing that the 340B
program had strayed from the original mission of helping uninsured, low-income
patients. The New Jersey-based pharmaceutical company is requesting a federal
judge to regard its 340B rebate plan as lawful.
Similarly, Johnson & Johnson and Eli Lilly have filed lawsuits over their own
revised 340B participation models after HRSA deemed the rebate plans illegal.
America's Essential Hospitals president and CEO Bruce Siegel, MD, praised HRSA's
action in a Dec. 17 press release shared with Becker's stating, "Sanofi's
decision to halt its illegal plan to offer rebates in the 340B Drug Pricing
Program shows how a forceful federal response and vigorous advocacy by essential
hospitals can combine to protect patients and preserve access to care."
Subscribe to the following topics: lettersanofiproposalsaleswarning
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