Leonard Stark, the federal judge who presided over AstraZeneca’s 340B contract pharmacy lawsuit from its start last year, is on the verge of being elevated to a higher court, possibly by the end of this week. If that happens before Stark hands down his opinion and orders, a different judge will be assigned to and decide the closely watched 340B case.
The U.S. Senate Judiciary Committee voted 15-6 on Jan. 13 to approve Stark’s nomination to a federal appeals court in Washington, D.C. The nomination to the U.S. Court of Appeals for the Federal Circuit is on the chamber’s list of matters reported out by committees and awaiting floor action. According to the Democratic majority, the chamber may hold vote on pending nominations towards the end of this week. Its focus now is trying to pass a national voting rights bill.
According to federal judicial procedural rules, “If a judge conducting a hearing or trial is unable to proceed, any other judge may proceed upon certifying familiarity with the record and determining that the case may be completed without prejudice to the parties.”
Stark, who serves on the Federal District Court for the District of Delaware, was assigned to Astra’s case on Jan. 20, 2021, eight days after it was filed. For a while last year, it looked as if he would be first among the four judges hearing the first six 340B contract pharmacy suits to rule on the government’s May 17, 2021, findings that Astra and five other drug companies’ conditions on 340B pricing involving contract pharmacy were illegal.
One of the First to Make Key Decision
In late June 2021, Stark handed down one of the first key decisions in the 340B contract pharmacy litigation. He struck down and set aside the federal government’s December 2020 legal advisory opinion, which the government had withdrawn about two weeks before Stark ruled, that the 340B statute compels drug manufacturers to offer 340B pricing when covered entities use contract pharmacies. This came two months after U.S. Senior District Judge Sarah Evans Barker of the District of Southern Indiana ruled in favor of Lilly’s motion to enjoin HRSA from enforcing its the 340B administrative dispute resolution (ADR) regulations against the Indiana-based company.
Late last October, Barker issued the first decision on the government’s May 2021 findings that the six companies were breaking the law. Judge Freda Wolfson of the U.S. District Court for the District of New Jersey was next with a joint ruling in Novo Nordisk and Sanofi’s cases early on Nov. 5. Later that same day, U.S. District Judge Dabney Friedrich of the District of Columbia issued her joint ruling in Novartis and United Therapeutics’ cases.
Barker held that “construing the 340B statute not to permit drug manufacturers to impose extra-statutory conditions on covered entities’ access to discounted medications is not only a permissible construction, but, in our view, the construction that best aligns with congressional intent.” She nevertheless struck down the U.S. Health Resources and Services Administration (HRSA) findings against Lilly on procedural grounds.
Wolfson ruled that Sanofi and Novo Nordisk’s 340B contract pharmacy policies violate the 340B statute. But she declined to decide whether the 340B statute permits covered entities to use multiple or unlimited contract pharmacies.
Friedrich ruled that HRSA’s reading of the 340B statute was wrong. The law does not bar manufacturers from attaching any conditions on sales involving contract pharmacies. However, the law does not permit all such conditions.
The government has filed appeals in all five cases. Lilly, Sanofi, and Novo Nordisk also have filed appeals.
