Advocacy and Legal Update

340B Reform Bill Introduced in House
by Johanna Gray, Artemis Policy Group

In late May, Reps. Bucshon (R-IL), Carter (R-GA), and Harshbarger (R-TN) introduced the 340B ACCESS Act. This legislation is supported by ASAP 340B (the partnership between PhRMA and the National Association of Community Health Centers) and is based on the principles that it released last March. You might recall that the Alliance had many concerns about the potential harm of the ASAP 340B principles when they were released.

The bill provides a comprehensive approach to 340B reform and as drafted, includes some wins and some concerns for HTCs. There are some positive aspects of the bill – for example, it prohibits a number of discriminatory practices that payers and PBMs use to lower reimbursement and implement unfair restrictions for 340B covered entities. In addition, there are several provisions of the bill that explicitly exclude HTCs from new, harmful regulations, for example a requirement that contract pharmacies be located within the same geographic area as the covered entity. Unfortunately, there are also provisions that would harm HTCs, such as a new patient definition and language around subgrantee participation in 340B that don’t recognize the current structures and practice of HTCs, as well as many burdensome transparency requirements.

We remain very concerned about the bill’s unintended consequences that would impact HTCs if enacted. After much discussion with Alliance leaders, we are finalizing a letter to the bill sponsors outlining our concerns and recommendations for improvements to the bill text. We will seek additional advocacy from Alliance members regarding this bill if it starts to get traction.

We remain doubtful that Congress will move any meaningful 340B reform legislation this year; but, we anticipate that this bill will likely be reintroduced next year.

SCOTUS Opinion Ends Deference to Agency Interpretations – What Could this Mean for the 340B Program?
by Elizabeth Karan, Artemis Policy Group

On June 28, 2024, the Supreme Court released Loper Bright Enterprises v. Raimondo which requires courts to exercise independent judgment in deciding whether an agency has acted within its statutory authority. The standards articulated in Loper could usher in a chaotic period of judicial review of agency action, including in the 340B Program.

Loper puts the final nail in the coffin of Chevron v. Natural Resources Defense Counsil, officially overruling this case and 40 years of prior precedent. However, the courts have been curtailing deference to agency interpretation of an ambiguous law for years and much remains to be seen about how lower courts will interpret the ruling. In writing for the majority, Chief Justice Roberts indicates that it would be appropriate for courts to seek aid from agency interpretations of the meaning of ambiguous statutory provisions, but courts must still exercise independent judgement in deciding whether the law means what the agency says it means.

Litigation challenging agency interpretation of the statutory authority is nothing new for the 340B Program and could proliferate further following Loper. Currently, stakeholders are in court regarding the use of contract pharmacies and, earlier this year, the government lost in federal appellate court regarding the definition of a patient in the 340B Program. We expect these legal challenges to continue.

Loper likely will impact both administrative advocacy and agency behavior. Opponents of certain rules can use the post-Chevron landscape to fuel doubts over policies they dislike. In turn, this approach could make agencies more cautious, slow decision-making, and require agencies to divert more resources to preparing for litigation.

Whether this environment ultimately benefits or hurts hemophilia treatment centers may depend on the administrative policy at play and/or if it spurns 340B Program reform activities in Congress. Stay tuned for more updates or reach out to your Hemophilia Alliance contact with questions.

U.S. Federal Trade Commission (FTC) Releases Scathing Report on PBMs
by Elizabeth Karan, Artemis Policy Group

Earlier this month, the FTC released a report titled “Pharmacy Benefit Managers: The Powerful Middlemen Inflating Drug Costs and Squeezing Main Street Pharmacies” which continues more than two years of work gathering work from major PBMs. As part of this process, the FTC solicited public comments on PBM practices and their impact on patients, physicians, employers, pharmacies, and other businesses across the pharmaceutical distribution system. The Hemophilia Alliance commented on this solicitation. Additionally, in 2022, the FTC issued orders requesting data and documents to the six largest PBMs—Caremark Rx, LLC; Express Scripts, Inc.; OptumRx, Inc.; Humana Pharmacy Solutions, Inc.; Prime Therapeutics LLC; and MedImpact Healthcare Systems, Inc.

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