HHS General Counsel nominee Sam Bagenstos answered questions about the 340B program during his Oct. 26 Senate Finance confirmation hearing.

Grassley Asks HHS General Counsel Nominee About Drug Companies “Harming Access” to 340B

A GOP U.S. Senator who has been active on 340B matters for decades last week asked President Biden’s pick to be the U.S. Health and Human Services Department’s top lawyer if HHS could be doing more to protect the 340B program from drug companies that “are harming access to it.”

Sen. Chuck Grassley (R-Iowa) told Sam Bagenstos, Biden’s nominee to be HHS general counsel, during Bagenstos’ Oct. 26 Senate Finance nomination hearing that he appreciates the administration’s efforts to do something about burdens that manufacturers are placing on Iowa’s hospitals and pharmacies.

“Many Iowa hospitals and pharmacists have talked to me about the 340B program, how these drug companies are harming access to it,” Grassley told Bagenstos. “The 340B drug program is an important program to keep drug costs low and maintain access for patients. Iowa pharmacists and hospitals have communicated to me the administrative burdens that the drug companies have placed on the 340B program.”

Although Grassley never said “contract pharmacy,” he appeared to be addressing manufacturers’ denials of and conditions on 340B pricing when covered entities contract with outside pharmacies to dispense 340B drugs.

Grassley told Bagenstos that “timely resolution is needed, or this will have a financial impact on hospitals and pharmacies and could even hurt patient access.”

“So, I want more transparency in the 340B program,” Grassley said. “The status quo is not sustainable. So, if confirmed, what additional steps could HHS take to protect the program? I hope HHS has all the tools they need and, if not, do you have recommendations for Congress to act?

Bagenstos, who now serves as White House Office of Management and Budget general counsel, answered, “I can tell you, in this administration, the drug companies’ that have not been complying with 340B requirements to work with contract pharmacies have been referred for enforcement.”

“One of the important jobs of the general counsel, should I be confirmed for this position, would be to ensure that those enforcement actions proceed as effectively as they can be,” Bagenstos continued. “There’s also quite a lot of other litigation involving 340B which the general counsel, should I be confirmed, would be required to address. I think it’s exceptionally important that this administration confirm its commit to the 340B program. And senator, if there are additional tools that are necessary, I can commit to working with you on what those tools might be.”

The Finance Committee has not yet scheduled a vote on whether to advance Bagenstos’ nomination to the full Senate.

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