340B administrative dispute resolution
HHS and HRSA recently told a federal district court they “are unable to predict” when they will finally replace HRSA’s 340B administrative dispute resolution proces.

HHS, HRSA Tell Judge They Don’t Know When They’ll Replace 340B Dispute Resolution Process

The U.S. Department of Health and Human Services and the Health Resources and Services Administration “are unable to predict” when they will finally replace HRSA’s 340B administrative dispute resolution process, the government said in a recent legal filing.

The government gave the update in a May 26 joint status report with Pharmaceutical Research and Manufacturers of America in PhRMA’s January 2021 lawsuit to strike down the ADR process that HRSA launched in January 2020.

HRSA’s 340B dispute resolution efforts have a tortured history. Its original purely voluntary system launched in December 1996 reportedly was used only once, without a result. Congress in March 2010 gave HHS 180 days to implement a mandatory and binding system. HHS finally did so 10 years later, in January 2020.

Only two complaints are known to have been filed. One, by the National Association of Community Health Centers against drug makers Lilly, Sanofi, and AstraZeneca over their 340B contract pharmacy restrictions, sputtered to an end in August 2022. An ADR panel’s decision to dismiss NACHC’s complaint (on the grounds federal courts were deciding the same issues) triggered a chain of events that led NACHC  in March to ally with PhRMA on 340B reform.

The other complaint, filed against AstraZeneca by individual health centers along with Ryan White Clinics for 340B Access, and about Astra’s contract pharmacy policy, is still alive. The health centers and RWC-340B, however, asked a federal district court in January to dismiss a related lawsuit against HHS and HRSA.

The Biden administration announced in December 2021 that it wanted to replace the ADR system that the outgoing Trump administration installed during its last days in January 2020. It said it wanted to install a new system “that “better aligns with the president’s priorities on drug pricing [and] better reflects the current state of the 340B program.”

It took HHS and HRSA until late November 2022 to publish its proposed replacement. Public comments were due Jan 30.

In February 2020, the federal district judge hearing PhRMA’s lawsuit to strike down the existing ADR system granted a motion to stay the lawsuit pending completion of HHS and HRSA’s efforts to replace that system. At that time, HHS and HRSA said “it is currently unclear how long that process will take.”

The May 26 joint status report shows little has changed since February.

HHS and HRSA told the court that “they have continued to work diligently on the administrative dispute resolution (ADR) rulemaking initiated late last year.” But, they continued, “At this time, [we] are unable to predict the likely timeframe for completion of that rule.”

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