Elizabeth Linderbaum is NACHC’s Deputy Director of Regulatory Affairs.
For the past 30 years, the 340B drug pricing program has served a critical role for the health care safety net, securing additional resources to help serve underserved populations. However, lack of clarity in the 340B statute—which has not been revisited since its passage—has created a crisis for Community Health Centers and most importantly, the patients they serve.
NACHC has pushed forward to find a solution for health centers and other true safety-net providers by forming the Alliance to Save America’s 340B Program (ASAP 340B) with PhRMA, the trade association that represents drug manufacturers. With the partnership of health centers, patient advocates, community organizations, and leaders from the biopharmaceutical industry, the plan is to work with Congress to modernize and strengthen the 340B program.
NACHC spent months working with PhRMA to develop comprehensive core principles to put the 340B program on stable footing. This includes addressing current challenges by:
- Adding contract pharmacy to the statute,
- Protecting against PBM discrimination,
- Clarifying the intent of the 340B program, and
- Developing a neutral clearinghouse.
Read all the core principles and an accompanying core principles’ FAQ document. ASAP 340B’s recent activities were also detailed in an episode of the 340B Unscripted podcast featuring Vacheria Keys, NACHC’s Director of Policy and Regulatory Affairs. Keys answers questions about the core principles and ASAP’s plans for the future. Listen to the interview with Vacheria Keys.
The Path Toward 340B Legislation
The formation of ASAP comes after a growing list of manufacturers refused to ship drugs to health center contract pharmacies since mid-2020. Health centers cannot wait any longer for a solution. NACHC left no stone unturned to fight for health centers in the 340B program. In fall 2020, we filed a lawsuit against Health Resources and Services Administration (HRSA) to get the Administrative Dispute Resolution (ADR) finalized, and then one of the first ADR petitions in January 2021. As the ADR panel weighed our petition for months, more manufacturers imposed restrictions, further distressing our health centers. Ultimately, in fall 2022, the ADR panel dismissed NACHC’s petition, stating that the issues NACHC raised were already addressed in the contract pharmacy litigation.
Meanwhile, federal litigation has led nowhere – recent court decisions have shown that contract pharmacy ambiguities won’t get resolved through litigation. Earlier this month, both Health and Human Services Secretary Xavier Becerra and HRSA Administrator Carole Johnson told Congress that HRSA needs more authority to properly oversee the 340B program. We know that health centers have grown tired of this never-ending battle. These realities underscore why NACHC took charge to protect 340B. ASAP 340B’s core principles will address the long overdue need for clarity for the 340B program and ensure proper authority for adequate oversight by HRSA.
A permanent fix to the 340B program is desperately needed as health centers lose millions of mission-critical dollars due to the contract pharmacy restrictions. Eighty-six percent of health centers use contract pharmacies, which serve as extension of the health center. Drug manufacturer restrictions have blocked patients from getting the affordable medications they need and health centers have been forced to make difficult decisions without 340B savings, including reduction of their essential staff or patient services.
The continued loss of 340B savings has placed an additional strain on health centers as they navigate the unwinding of the Public Health Emergency. Health centers have directed myriad resources to educate their communities on Medicaid redeterminations to ensure eligible patients don’t lose their coverage. Health centers are grappling with the loss of COVID-19 funding which helped them stay afloat during the pandemic. Legislation is the only way to ensure health centers’ 340B savings are protected for decades to come.
Continuing the Advocacy Drumbeat
We need Congress to understand that the time is now to fix the 340B program and pass legislation to protect the true safety net. Keep your eye out for emails from firstname.lastname@example.org to be kept in the loop about all 340B advocacy activities.