AstraZeneca and the federal government are miles apart on what a federal judge should do next in the company's 340B contract pharmacy lawsuit.

DOJ and AstraZeneca Far Apart on How Company’s Lawsuit Should Proceed

Drug manufacturer AstraZeneca and the federal government are miles apart on what a federal judge should do next after ruling last week that the government had no basis for stating in December that the 340B statute unambiguously requires manufacturers to honor 340B contract pharmacy arrangements.

U.S. Chief Judge Leonard Stark of the District of Delaware ruled on June 16 Congress was silent about the role that contract pharmacies may play in purchases of 340B drugs, and “there is more than one permissible interpretation of the statute.” He ordered the two sides to report to him by yesterday on what relief AstraZeneca is entitled to in light of his ruling, and how the case should proceed, if at all.

On Friday, the U.S. Health and Human Services Department (HHS) withdrew the December 2020 advisory opinion on 340B contract pharmacy at the heart of AstraZeneca’s suit. On May 17, the U.S. Health Resources and Services Administration sent AstraZeneca and five other manufacturers letters informing them that their restrictions on 340B pricing when covered entities use contract pharmacies are illegal.

In yesterday’s status report to Stark, the U.S. Justice Department (DOJ) said:

  • AstraZeneca’s claims challenging the advisory opinion are moot and should be dismissed
  • HRSA’s May 17 violation letter to AstraZeneca does not rely on the withdrawn opinion
  • HRSA intends to continue enforcement proceedings against AstraZeneca pursuant to the May 17 letter
  • the litigation should continue and that the Court should decide the legality of the HRSA violation letter.

AstraZeneca said the court should:

  • declare that the withdrawal of the advisory opinion did not moot the case
  • declare that the advisory opinion was adopted without observance of procedure required by law
  • declare that the 340B statute is silent as to the role that contract pharmacies may play in connection with covered entities’ purchases of 340B drugs; that a requirement for pharmaceutical manufacturers to deliver 340B drugs to an unlimited number of contract pharmacies is not “contained in the statute; and that the advisory opinion’s legal position that the 340B statute unambiguously requires manufacturers to offer 340B discounts for unlimited contract pharmacy sales is not in accordance with law and is invalid
  • vacate and set aside the opinion
  • direct both sides to meet and confer with respect to HRSA’s May 17 violation letter
  • order AstraZeneca to amend its complaint to address the May 17 letter
  • grant other relief as the court deems appropriate.
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