Federal Appeals Court courtroom interior
Novo Nordisk and Sanofi urged a federal appeals court in Philadelphia to reverse a district judge’s ruling that their denials on 340B pricing when providers use multiple contract pharmacies violate the 340B statute.

Novo Nordisk, Sanofi, and Feds Trade Arguments in 340B Contract Pharmacy Litigation

Drug manufacturers Novo Nordisk and Sanofi last month urged a federal appeals court to reverse a district judge’s ruling that the companies’ conditions on 340B pricing when providers use multiple contract pharmacies violate the 340B statute.

Meanwhile, the federal government last week told the appeals court that the district judge erred in November 2021 when she told federal health officials to assess whether the 340B statute forces them to let all providers have a limitless number of contract pharmacies, or whether under the statute they can set different limits for different types of providers.

Novo Nordisk and Sanofi were responding to arguments the government offered in May to the U.S. Third Circuit Court of Appeals in Philadelphia. The government was replying to the two companies’ June 8 briefs. Novo Nordisk and Sanofi filed their opening briefs in March. It appears that all the required briefs in the litigation have now been filed.

Novo Nordisk and Sanofi are challenging the U.S. Health Resources and Service Administration’s May 2021 determinations that the companies’ restrictions on 340B pricing involving the contract pharmacy program are illegal. They both filed their suits in federal district court in New Jersey and the cases were consolidated.

U.S. Chief District Judge Freda Wolfson handed down a mixed decision. She upheld HRSA’s findings that the 340B statute permits the use of contract pharmacies, that Novo Nordisk and Sanofi may not attach strings to 340B offers, and that the companies overcharged covered entities. But she declined to decide whether the 340B statute lets entities use unlimited contract pharmacies.

The federal government is challenging Wolfson’s decision to send the matter back to HRSA to decide how many contract pharmacies a covered entity may use.

The Third Circuit Court in April consolidated Novo Nordisk and Sanofi cases with Astra Zeneca’s 340B contract pharmacy case. The government filed its brief in that case on June 21. AstraZeneca’s response brief is due no later than July 21, and the government’s reply brief on Aug. 11. 

Five groups that represent hospitals that participate in 340B filed a friend of the court brief last week backing the federal government in the Astra Zeneca case. Johnson & Johnson and Pharmaceutical Research and Manufacturers of America recently filed friend of the court briefs in Novartis and United Therapeutics’ consolidated 340B contract pharmacy suit being heard by a federal appeals court in Washington, D.C. We plan to report on those amicus briefs later this week.

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