340B covered entities are scrambling to respond to the fallout from Bausch Health's surprise announcement that it ended its relationship with AmerisourceBergen to distribute its 340B-priced branded products. | Source: Shutterstock

340B Providers Blindsided by Bausch Health’s Decision to Drop AmerisourceBergen as Distributor

Drug manufacturer Bausch Health blindsided 340B covered entities on New Year’s Eve, announcing that starting the very next day, Jan. 1, more than 200 of its branded products and future branded products would no longer be available through distributor AmerisourceBergen “for 340B covered entities and 340B contract pharmacies for purchases at the 340B ceiling price.”

“Consequently, covered entities and contract pharmacies looking to obtain Bausch Health drugs at the 340B ceiling price through Amerisource Bergen should instead utilize an alternative national distributor or a regional distributor for such purchases,” Bausch Health said in an electronic communication dated Dec. 31 that multiple recipients shared with 340B Report.

“Note that Bausch Health is firmly committed to the 340B Program, and we are happy to help with any questions you may have to ensure your uninterrupted access to these products as set forth above,” the communication continued. “Please feel free to contact Bausch Health with any questions using this mailbox: 340Binquiries@bauschhealth.com.”

Bausch Health did not give a reason for its action in the letter. It has not responded to a Jan. 7 request for comment. AmerisourceBergen declined to comment.

Bausch Health changed its name from Valeant Pharmaceuticals in 2018. Under its old brand, it attracted scrutiny and much criticism for its practice of buying the rights to long-established pharmaceuticals and jacking up their prices, in one example by just under 3,000 percent.

Cuprimine, Isuprel, and Nitropress—the Valeant products whose price hikes were the focus of a U.S. Senate Committee on Aging hearing in 2016—are among the Bausch Health drugs that covered entities can no longer buy from AmerisourceBergen through 340B. In June 2016, Valeant issued credits to 340B covered entities for overcharges on two Isuprel NDCs and one Nitropress NDC, for sales from August 2015 through September 2015.

340B pharmacy inventory consultants we spoke to said covered entities and contract pharmacies that have AmerisourceBergen as their primary distributor now have to contract with a secondary distributor to purchase the Bausch Health branded products at 340B prices. Third party administrators (TPAs) then will have to configure covered entities’ 340B split-billing and contract pharmacy administration software to register Bausch Health purchases through the secondary distributor.

“I am not certain that TPAs are set up to do ordering from multiple wholesalers, so it may not even be possible to replenish products from Bausch unless your primary is someone other than AmerisourceBergen,” one 340B covered entity consultant told us.

“Just a headache—period,” another 340B covered entity consultant said.

A 340B program manager at a major U.S. health system told us late yesterday afternoon that he personally had not yet received a communication from Bausch Health about its decision to drop AmerisourceBergen for 340B-priced products. He said he learned about the situation from an email he received yesterday morning from Walgreens, a 340B contract pharmacy partner. According to the 340B program manager, it said:

Dear Covered Entity,

On December 31st, Bausch Health issued a “2021 Distribution Plan for Bausch Health Branded Rx NDCs” notice which may affect your 340B program.

To avoid the unexpected adverse financial impact this manufacturer action may have on your 340B program, effective January 8, 2021, Walgreens began blocking the specific Bausch Health products listed in the notice. This does not mean that Walgreens has stopped dispensing Bausch Health drugs to your patients, but it does mean that prescriptions for the listed products will no longer be validated into your 340B program. Your uninsured population may be at risk if they are unable to pay the retail cash price for the impacted Bausch Health medications.

The 340B program manager said his health system has not received a communication from AmerisourceBergen about the situation.

“I am really confused,” he said. “I have been looking at our 340B pricing for the list of Bausch products in our Amerisource portal. There is still inventory available and it is showing that it still has 340B pricing at both our mixed-use and contract pharmacy settings.”

“Obviously Amerisource has not had enough time to adjust their systems to remove the pricing from all of their accounts, so we end up taking care of our patients only to find out after qualifying the dispensation that we are severely underwater on the claim,” he said. “Adjusting these systems takes time and the covered entity ends up taking the loss while taking care of patients.”

Early this afternoon, 340B Report obtained an undated communication from AmerisourceBergen to customers stating that, effective Jan. 1, Bausch Health ended its 340B pricing with the distributor for current and future branded NDC. “These Bausch products will no longer be available at the 340B contract price to AmerisourceBergen’s eligible 340B covered entities. For non-340B purchases, all customers can still purchase these products from AmerisourceBergen.” The communication included a link to a public AmerisourceBergen spreadsheet listing the affected NDCs, and a password-protected copy of the Bausch Health letter.

In February 2020, Bausch Health posted a notice to 340B covered entities on the U.S. Health Resources and Services Administration (HRSA) website that it was moving three generic products—Bexarotene Capsules 75mg 100ct (NDC 68682-0003-10), Metformin Hydrochloride ER Tablets, 500mg (NDC 68682-0021-50), and Metformin ER Tablets, 1000mg (NDC 68682-0018-90)—“to a direct distribution structure,” using vendor R&S Solutions “as the exclusive national service provider to Bausch Health for direct purchasing.”

Editor at Large | Website | + posts