GlaxoSmithKline today announced a new 340B contract pharmacy policy that affects nine of its inhaled medicines and applies to hospitals only.

News Alert: GlaxoSmithKline Becomes the 14th Drug Maker to Limit 340B Contract Pharmacies

UPDATE Monday, Feb. 14, 2022, 1:30 p.m. EST—The U.S. Health Resources and Services Administration (HRSA) said, “We are reviewing GSK’s policy and will evaluate next steps as needed.”

Drug manufacturer GlaxoSmithKline (GSK) told 340B covered entities this morning that effective April 1, it will let 340B hospitals without an in-house pharmacy designate just one contract pharmacy for 340B bill to / ship to replenishment orders of nine of its inhaled drugs for asthma, bronchitis, and other breathing problems. If hospitals agree to share their 340B contract pharmacy claims data for the products with GSK they can continue to use multiple contract pharmacies to dispense the drugs.

“Federal grantees will remain eligible to place bill to / ship to replenishment orders of 340B priced drugs for their contract pharmacies,” GSK says in a letter dated February 2022 addressed to “valued 340B customer.” A 340B hospital received an email from GSK this morning that links to the letter.

GSK’s new policy applies to Advair, Ventolin, Breo, Trelegy, Anoro, Incruse, Flovent, Arnuity, and Serevent.

GSK said hospitals should use drug industry contractor 340B ESP’s platform to make their single contract pharmacy designation if they decide not to share their claims data. If they do decide to share their data, they should upload it via 340B ESP’s platform, GSK said. Contract pharmacies that are wholly owned by a 340B hospital or have common ownership with a health system will remain eligible to receive bill to/ ship to replenishment orders of the nine affected drugs, the company said.

GSK is the 14th company to impose conditions on 340B sales of prescription drugs involving contract pharmacies. Pfizer was the most recent one before today. It announced its policy on Jan. 28.

GSK Statement

GSK said this morning that it notified the U.S. Health Resources and Services Administration (HRSA) about its new policy on Feb. 11.

“GSK strongly believes in the intent of the 340B program and we are committed to ensuring patients have access to our products in the way the law intended,” the company said in a statement to 340B Report. “However, in recent years, lack of oversight of the 340B program has increasingly led to abuses that undermine its goal and call into question whether patients directly benefit from 340B discounts.”

“One acknowledged source of this abuse is the proliferation of arrangements between 340B covered entities and some of the largest for-profit contract pharmacies,” the statement continued. “These arrangements have added complexity in the implementation of the 340B program and increased the risk of program abuses including duplicative discounts on certain products. For example, when a prescription for a Part D or commercially insured patient is written at a covered entity and filled at a contract pharmacy, the manufacturer is exposed to a duplicate discount (340B discount plus the Part D/Commercial Managed Care rebate). Duplicate discounts result in some of our products being sold at a substantial loss.”

“We remain committed to the 340B program and believe this change will further strengthen the program in support of its core mission while helping to mitigate current issues that exist with covered entity contract pharmacy arrangements,” GSK said.

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