The federal government has asked three more federal judges to not let hospital groups intervene in drug manufacturers' lawsuits challenging HHS's 340B contract pharmacy requirements. | Shutterstock

Feds Oppose Hospitals’ Intervention in Three More Pharma 340B Lawsuits

The federal government has asked federal district judges in Indianapolis, Delaware, and New Jersey to deny hospital groups’ requests for active roles in drug manufacturers Eli Lilly’s, AstraZeneca’s, and Sanofi’s lawsuits against the government over its 340B contract pharmacy requirements.

Last week, the government asked Chief Judge Freda L. Wolfson of the U.S. District Court for the District of New Jersey to not let the groups—American Hospital Association (AHA), 340B Health, America’s Essential Hospitals, the Association of American Medical Colleges (AAMC), Children’s Hospital Association (CHA), and ASHP (American Society of Health-System Pharmacists)—intervene in manufacturer Novo Nordisk’s 340B contract pharmacy suit against the U.S. Health and Human Services Department (HHS).

Government lawyers over the course of this month raised similar objections to letting the hospital groups participate as third parties in suits against HHS brought by Lilly, AstraZeneca, and Sanofi. In each case, the government asked the judge to hold off on ruling on the groups’ motion to intervene and rule first on the government’s request to dismiss all claims against it on jurisdictional grounds.

If the judge in each case, however, decides to rule on the hospital groups’ motion to intervene, it should deny it because the groups’ don’t meet the requirements for such status, the government said.

In its motions in all three cases, the government said the hospital groups “could serve a helpful role” by filing friend-of-the-court briefs “fleshing out the facts surrounding the 340B program.”

“But cheering on HHS and hoping it prevails in litigation does not justify participation as a party in this litigation,” the government said.

The groups have argued that they need to be made parties to the cases so they can ensure that their member hospitals and those hospitals’ patients continue to have access to 340B drugs. They say the government so far has done almost nothing to stop the manufacturers from denying their members the discounts to which they are entitled by law. All it has done, they say, is finalize regulations to establish a 340B administrative dispute resolution (ADR) process, which some of the manufacturers are challenging in court and which the government seems to have placed on hold.

The hospital groups sued HHS in December to force it to require Lilly, AstraZeneca, Sanofi, Novo Nordisk, Novartis, and United Therapeutics to offer 340B discounts on drugs dispensed through contract pharmacies, to issue refunds for discounts that were refused, and to impose civil monetary penalties against the companies. A federal judge in Oakland, Calif., however, dismissed their suit in February on procedural grounds.

The government says the hospital groups shouldn’t be allowed to argue in the three lawsuits on behalf of their interpretation of the 340B statute, when the judge in the case that they filed against the government ruled it was premature for them to sue.

Lilly conditionally opposed letting the hospital groups participate in its case, on the grounds that the groups have not clearly established that their members have 340B contract pharmacy relationships. It also rejected the groups’ arguments that a ruling for Lilly would impair their members’ interest in receiving 340B discounts to which they are entitled, and would impair their members’ ability to provide services.

AstraZeneca said the hospital groups should not be allowed to intervene in its case because they “do not have a legally cognizable interest in this litigation that is both specific to them and direct.” The manufacturer also said the groups “cannot overcome the strong presumption that the government will adequately represent their interests.”

Sanofi said it took no position on the groups’ desire to participate in its suit against the government, provided that they limited their involvement to claims about the government’s December advisory opinion that Sanofi and other manufacturers had to offer 340B pricing on their products no matter how the drugs were dispensed. Sanofi also said it would not object to the groups’ participation, provided that their participation did not delay court proceedings, and that nothing would get in the way of Sanofi’s right to challenge the accuracy of claims the groups’ made in their motion to intervene.

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