Hospital trade group 340B Health has asked pharmaceutical giant Boehringer Ingelheim (BI) to withdraw its plan to cut off discounts for drugs that are distributed by contract pharmacies. However, BI does not appear to be backing down and the German-based company is calling on policymakers to make “significant reform” to the program.
As 340B Report broke on July 1, BI will stop shipping 340B-purchased drugs to hospitals’ contract pharmacies, effective Aug. 1.
Community health centers, HIV/AIDS clinics, and other federal grantees are exempt from BI’s new policy. It applies to all the manufacturer’s products except the company’s specialty drugs OFEV, Gilotrif, and Praxbind. BI will let hospitals without an in-house pharmacy designate a single contract pharmacy location to receive and dispense BI products. Hospitals will have to register with drug manufacturer vendor 340B ESP to make their contract pharmacy designation.
The request was made by 340B Health on Wednesday. The organization declared the move by the Germany-based company as illegal.
“The decision of Boehringer Ingelheim…to violate the 340B law and withhold required discounts to many hospitals serving low-income and rural communities is appalling,” said 340B Health CEO Maureen Testoni. “By circumventing the law, BI will harm the financial health of safety net providers across the country and the health and well-being of the patients they serve. The federal government has clearly stated actions like these are unlawful and must stop, but the company is ignoring this unequivocal directive and daring regulators to try to stop them.”
Other hospital groups are also starting to weigh in. “Boehringer Ingelheim, like other drug companies before it, takes an unlawful action that puts the health of low-income patients at risk and jeopardizes access to care. It’s another sad chapter in the pharmaceutical industry’s campaign to undermine the 340B program, and we will continue to fight these damaging and illegal policies,” said Beth Feldpush, senior vice president of policy and advocacy for America’s Essential Hospitals.
Boehringer Ingelheim Defends Plan and Calls for Signficant Reform
BI’s Chris Marsh, Senior Vice President for Market Access, defended the company’s game plan and called on Congress to make changes to the 340B program. “After thoughtful consideration, we are instituting a carefully tailored approach based on criteria to help ensure that Boehringer Ingelheim’s participation in the 340B program benefits patients of covered entities, as originally intended.”
340B Report asked BI whether it has concerns that its move will undermine the company’s relationship with the U.S Department of Health and Human Services. “While Boehringer Ingelheim supports the original intent of the 340B program to ensure access to discounted drugs for indigent and vulnerable patients, the need for significant 340B program reform has been acknowledged. Furthermore, as the COVID-19 pandemic continues and resources become increasingly limited for patients and their families, it is more important than ever to ensure that the 340B program directly benefits patients and enables them to maintain access to their life-enhancing medications. We look forward to working with policymakers and other stakeholders on legislative reforms to address 340B program integrity concerns and ensure that the program is benefitting uninsured and vulnerable patients as originally intended,” Marsh added.
BI did not directly respond to a question about whether the company is confident it will be successful and is prepared to challenge HHS in court once the company begins the restrictions. However, Marsh said, “patient access to our medications is not compromised and our commitment to affordable drug prices continues, while we support policies that move toward a value-driven healthcare system and advance solutions that truly benefit patients. The updates to our program only changes the way in which product is distributed to covered entities on which the 340B program is focused.”
BI’s upcoming move makes it the seventh drug manufacturer to deny or restrict 340B discounts in the contract pharmacy setting. However, BI is the first company to announce plans to implement restrictions since the U.S. Health Resources and Services Administration (HRSA) sent letters on May 17th to six drug manufacturers notifying them they were violating the 340B statute and asked them to devise plans to restore the discounts and reimburse covered entities for lost savings. A number of the manufacturers are challenging the demand letters in various federal courts throughout the country.