Due to litigation, 340B program director Rear Adm. Krista Pedley could say little about the drug discount program during yesterday’s 340B Coalition virtual summer conference.

Pedley Provides 340B Update but Avoids Contract Pharmacy Controversy

Rear Adm. Krista Pedley, Director of the U.S. Health Resources and Services Administration’s (HRSA) Office of Pharmacy Affairs (OPA), gave a brief update on the 340B program during yesterday’s 340B Coalition virtual summer conference. She explained that “due to current litigation in the program, I am unable to provide specifics concerning much of the work that is underway on the 340B program at HRSA.”

“We continue to work closely with HHS leadership on key priorities and will continue to provide updates to the extent that we are able,” Pedley said.

Pedley told attendees:

  • Regarding the COVID-19 pandemic, HRSA remains committed to providing the utmost flexibility, to the fullest extent possible to all stakeholders participating in the program, while ensuring program integrity.
  • Since fiscal year 2012, HRSA has conducted 1,638 covered entity audits, which includes 22,207 outpatient facilities, and 38,292 contract pharmacies. In fiscal 2022, HRSA plans to conduct an additional 200 audits. In addition, HRSA has finalized 28 audits of manufacturers since fiscal 2015 and plans to conduct five audits in fiscal 2022.
  • There has been a significant reduction in notifications of potential incorrect 340B prices in the market since HRSA launched its congressionally mandated secure 340B ceiling price website in 2019.

Pedley did not address the status of a reorganization of HRSA announced in January by the Trump administration’s outgoing HRSA administrator Tom Engels. On paper, the reorganization moves the 340B program into a new Office of Special Health Initiatives (OSHI) housed within the HRSA administrator’s office. In a Jan. 15 email to HRSA’s staff, Engels said Pedley would lead OSHI, which also includes HRSA’s vaccine injury compensation, global health, oral health, and behavioral health programs.

After the HRSA reorganization was announced, persons knowledgeable about HRSA’s internal affairs said they expected that the OPA director position would soon be posted on the federal USA Jobs website. That has not happened, however.

The Biden administration has neither withdrawn the Federal Register notice about the reorganization nor implemented it. The government, however, recently posted job notices for a different new HRSA office that the reorganization created.

The Biden administration has not yet appointed a successor to Engels as HRSA administrator. Career official Diana Espinosa continues to serve as acting administrator.

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