The HHS jumped the gun by proposing a rule governing drug discount disputes in the federal 340B program, a leading drug industry group said in comments on the proposal.

The proposed rule (RIN: 0906-AA90) from the Department of Health and Human Services would establish a binding administrative dispute resolution (ADR) process for certain disputes arising under the 340B program. It was published in the Aug. 12 Federal Register (81 Fed. Reg. 53,381). Comments were due Oct. 11.

The 340B program requires drug manufacturers to provide outpatient drugs to eligible safety-net health-care organizations at significantly reduced prices.

The HHS said the purpose of the ADR process is to resolve claims by covered entities, such as hospitals, that say they have been overcharged for outpatient drugs by manufacturers. It also would resolve claims by drug manufacturers that a covered entity is using 340B drugs for ineligible patients or receiving duplicate discounts on drugs.

The rule establishes an ADR process prematurely “before key ground rules that must necessarily shape the ADR process have been established,” the Pharmaceutical Research and Manufacturers of America (PhRMA) said in Oct. 11 comments. The agency first needs to issue or revise certain other rules and guidance documents, the industry group said.

Meanwhile, health-care provider groups said when the proposed ADR panel makes a decision for a particular case, that decision shouldn't be considered a broad 340B policy decision.

Both the drug industry and safety-net providers would like to see changes to the 340B program. While pharmaceutical companies are concerned about unclear eligibility requirements and duplicate discounts on 340B drugs, hospitals and other providers are concerned that they aren't always receiving the appropriate discounts from drugmakers.

The Health Resources and Services Administration (HRSA), the part of the HHS that administers the 340B program, proposed the ADR “to be the last resort and expects 340B covered entities and manufacturers to continue to work informally to resolve disputes,” Stephanie Trunk, a health-care attorney with Arent Fox LLP in Washington, told me.

“Much of the proposed process is not completely fleshed out, and HRSA is likely to use stakeholder comments to inform and mold the specific process further,” Trunk said. “In addition, HRSA was less than clear as to the composition of the panel, which will be the arbitrator of formal disputes between 340B covered entities and manufacturers.”

My full article is here.

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