Drug manufacturer Boehringer Ingelheim (BI) said on Friday that health centers will be subject to its limits on 340B pricing involving contract pharmacies starting Sept. 1. The restrictions previously applied to hospitals only. “At this time, for all other federal grantee types,” the conditions do not apply, it said.
Under BI’s 340B policy update, the company will ship health centers’ 340B-purchased drugs to multiple contract pharmacies only if the centers provide 340B contract pharmacy claims data to BI via its vendor 340B ESP. Health centers lacking an in-house pharmacy can designate a single contract pharmacy to receive and dispense 340B-purchased BI drugs. Contract pharmacies that are wholly owned by a 340B covered entity or are under common ownership with a 340B health system may apply for an exemption, BI said.
In December 2021, BI added its specialty drug Ofev to those to which its conditions apply. Health centers that decline to share their claims data with BI and that lack an in-house pharmacy able to dispense specialty products “may also designate one (1) specialty pharmacy from within BI’s limited distribution network for the sole purpose of dispensing OFEV to its patients,” the company said.
BI is the eighth drug maker to impose 340B pricing conditions on health centers. Its original policy that took effect in August 2021 applied to hospitals only. Drug manufacturer Merck similarly extended its 340B pricing limits to health centers on May 31. Like BI’s original policy, Merck’s initial policy that began September 2021 applied to hospitals only.
Since July 2020, 18 manufacturers have imposed conditions on 340B pricing when covered entities use more than on contract pharmacy. Bausch Health was the latest. Its conditions, which apply to all covered entity types, started on Aug. 1.
The U.S. Health Resources and Services Administration (HRSA) told BI in October 2021 that its 340B pricing restrictions were illegal and had to stop. BI sued HRSA in defense of its policy later that same month. HRSA in March referred BI to the U.S. Health and Human Services Department Office of Inspector General for possible imposition of civil monetary penalties.
Health Center Representatives’ Reactions
Sue Veer, President and CEO of South Carolina-based Carolina Health Center and a respected national health center leader on 340B, said, “I continue to be perplexed by those pharmaceutical manufacturers that are choosing to limit affordable prescriptions for our nation’s most underserved and vulnerable populations by refusing to honor statutorily required 340B pricing to safety net providers like community health centers.”
“The public needs to understand that the 340B drug pricing program is not a federally funded program,” Veer said in a written statement to 340B Report. “It doesn’t cost taxpayers a dime. I have always referred to it as a public/private partnership between for-profit companies like Boehringer Ingelheim and nonprofit health care providers with the intent being to improve the health of our most at-risk populations, which in turn reduces health care costs across the entire health care delivery system.”
“Wouldn’t you think that these multi-billion dollar for profit companies would want to invest in those outcomes for our country and be recognized for their contribution to this critical partnership?” Veer asked.
“Together we could be health care heroes. Instead, actions like BI has taken today pit us as adversaries,” she said.
“I fail to understand how manufacturers like BI justify imposing these types of restriction on CHCs when it is well-documented that almost two-thirds of CHC patients have incomes below the federal poverty level, and CHCs are required by law, regulation, and mission to invest every penny of 340B savings into activities that expand access for their patients,” said Colleen Meiman, policy adviser to state and regional primary care associations. “Actions like these are directly harming the most vulnerable patients in our country.”
The National Association of Community Health Centers (NACHC) this morning acknowledged a request for comment on BI’s announcement but did not respond in time for this article. Check back for an update later today.