HRSA confirmed yesterday that 340B program administrative dispute resolution (ADR) panels have been assigned.

In Significant Development, HRSA Assigns Panels to Review 340B Dispute Resolution Claims Against Drug Companies

The U.S. Health Resources and Services Administration (HRSA) told 340B Report yesterday in response to an inquiry that 340B program administrative dispute resolution (ADR) panels have been assigned—signaling that an unknown number of proceedings might begin on ADR petitions by covered entities against drug manufacturers for denying 340B discounts on drug dispensed by contract pharmacies.

“HRSA can confirm that panels have been assigned. We have no other comment at this time,” an agency spokesperson said late yesterday afternoon.

There are five known 340B ADR petitions:

  • Three filed by federally qualified health centers against AstraZeneca, in collaboration with the group Ryan White Clinics for 340B Access (RWC-340B). The FQHCs are Open Door Community Health Centers in California, Little Rivers Health Care in Vermont, and FamilyCare Health Center in West Virginia.
  • One filed by the National Association of Community Health Centers’ (NACHC) on behalf of its members against AstraZeneca and Sanofi.
  • Another filed by NACHC on its members’ behalf against Lilly.

NACHC originally filed a single petition on its members’ behalf against AstraZeneca, Lilly, and Sanofi. In March, a federal district judge enjoined HRSA from enforcing its 340B ADR regulations against Lilly. Last month, NACHC split off its claims against Lilly into a separate petition. HRSA had told NACHC in August that it could not take any further action on the group’s single petition against the three manufacturers due to the injunction against ADR proceedings against Lilly.

Sanofi, in its lawsuit challenging HRSA’s findings that the company’s 340B contract pharmacy policies violate the 340B statute, is seeking an injunction against ADR proceedings. AstraZeneca has not sought such an injunction, so far.

Also, Pharmaceutical Research and Manufacturers of America (PhRMA) is suing to have the ADR process declared unconstitutional and illegal.

RWC-340B and NACHC separately sued the U.S. Health and Human Services Department (HHS) in October 2020 to compel it to publish long delayed final regulations establishing the ADR process, which HHS did in January 2021. HHS Secretary Xavier Becerra appointed six voting members and two ex-officio non-voting members to the ADR board in June, tweaking the list that his predecessor Secretary Alex Azar appointed on his final day in office.

The cases have been stayed as the government has pursued a different path to require the drug manufacturers to restore 340B pricing in the contract pharmacy setting.

A new federal district judge was assigned to the two cases on Oct. 1—Florence Pan, a Biden nominee who just assumed office on Sept. 23. The previous judge, Ketanji Brown Jackson, was elevated to the federal appeals court for District of Columbia in June.

The parties in both the RWC-340B and NACHC cases are due to deliver status reports to Pan on Oct. 25.

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