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Drug manufacturer Pfizer stiffened its conditions on 340B sales to hospitals of the immunosuppressant Xeljanz.

News Alert


Pfizer Is the Second Drug Maker This Week to Tighten Limits on 340B Sales to Hospitals

Drug manufacturer Pfizer today stiffened its conditions on 340B sales to hospitals of the immunosuppressant Xeljanz, one of its top-selling products.

Starting May 1, Pfizer will let hospitals without an in-house pharmacy designate just one contract pharmacy for Xeljanz. Pfizer also is ending its policy exemption for hospitals’ wholly owned contract pharmacies. These will not be able anymore to separately receive 340B-purchaed Xeljanz on a bill to / ship to basis.

Under Pfizer’s existing policy in place since March 2022, hospitals could keep buying Xeljanz at a 340B price for shipment to multiple contract pharmacies if they agreed to provide related claims data for Xeljanz sales to drug industry contractor 340B ESP. Pfizer’s notice today says hospitals can keep submitting such data to 340B ESP voluntarily.

Pfizer’s other existing conditions on 340B sales to hospitals of 11 oral oncology medicines are unchanged, the company said. Today’s notice includes a courtesy copy of those conditions (briefly stated, unlimited contract pharmacy in exchange for claims data, and exemptions for wholly owned contract pharmacies).

Grantee covered entities continue to be exempt from the conditions on 340B sales, Pfizer said.

Pfizer reported $1.12 billion in revenue on U.S. sales of Xeljanz in 2022, down from $1.64 billion the year before. In its annual report to the U.S. Securities and Exchange Commission, Pfizer attributed the revenue decline partially to “declines in net price due to unfavorable changes in channel mix in the U.S.”

In several places in the notice and attached FAQ, Pfizer said its policy is consistent with a Jan. 30 federal appeals court opinion. The court held that “Congress never said that drug makers must deliver discounted Section 340B drugs to an unlimited number of contract pharmacies.”

Since then, three other drug makers—Johnson & Johnson, Amgen, and AbbVie (the latter on Wednesday)—have adjusted their conditions on 340B sales to limit to hospital covered entities to just one contract pharmacy. 340B stakeholders expect more such announcements.

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