HHS Secretary Xavier Becerra has signed off on a reorganization of HRSA that elevates decision making about the 340B program closer to the top of the department.

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News Alert: Becerra Signs off on HRSA Reorganization that Elevates 340B Program’s Status

The 340B drug pricing program has a new, higher profile home within the U.S. Health Resources and Services Administration (HRSA), and likely is getting a new director due to its current director’s promotion.

U.S. Health and Human Services (HHS) Secretary Xavier Becerra late yesterday afternoon announced the Biden administration’s revisions to changes the Trump administration made to HRSA in January during its last days in power. The prior administration’s changes have been on hold since they were announced. In late July, HRSA said the reorganization remained under review.

Becerra’s revised reorganization of HRSA retains moving HRSA’s Office of Pharmacy Affairs (OPA), the 340B program’s home, from HRSA’s Health System’s Bureau to a new Office of Strategic Health Initiatives (OSHI) in the HRSA administrator’s office.

HRSA career civil servant Diana Espinosa is the acting HRSA administrator. The Biden administration has not yet appointed a permanent administrator.

HHS posted Becerra’s announcement about the reorganization for public inspection on the Federal Register website at 4:15 p.m. Eastern yesterday. The document is dated Aug. 6. The announcement will be officially published on Tuesday, Aug. 31.

Moving the 340B program into the HRSA administrator’s office is a powerful symbol of the program’s growing importance, both within the government and in the prescription drug marketplace at large. It shifts decision making about 340B much closer to the top of HHS.

The shakeup also occurs at a highly sensitive time for the 340B program. HRSA is in the middle of a bruising fight with multiple drug manufacturers over 340B contract pharmacy.

On Jan. 15, Trump’s HRSA Administrator Tom Engels announced to HRSA’s staff in an email that Rear Adm. Krista Pedley, OPA’s director since July 2010, was being promoted to head OSHI, which will include OPA plus HRSA’s global health, behavioral health, and oral health programs.

HRSA has not yet responded to a request this morning for comment on whether Engels’ promotion of Pedley remains in effect. Individuals familiar with HRSA’s internal affairs say they believe Pedley will soon be, or already has been, formally promoted.

HRSA also has not yet responded to a request for comment about the status of the job of OPA director.

When the news broke in January about Engels’ announcement about Pedley’s promotion, individuals familiar with HRSA’s internal affairs said they expected the OPA director position would soon be posted on the federal USA Jobs website. An announcement of a job opening had not yet been posted on the site as of late this morning.

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