AHA Has Sent Letters to Drug Companies Expressing ‘Profound Concern’ About Undermining 340B

On Friday, the American Health center Association corresponded to the heads of U.S. operations for 5 big drug business – — Merck, Eli Lilly, Sanofi, Novartis, and AstraZeneca –– revealing “extensive concern” over what the hospital group says are actions they are requiring to restrict the distribution of particular 340B drugs to healthcare facilities and health systems. The AHA is asking them to “cease this conduct instantly.”

The actions mentioned by AHA variety from restricting the circulation of certain 340B drugs to demanding, on short notice, detailed reporting on 340B drugs distributed through health centers’ agreement drug stores –– reporting the AHA calls “unneeded.”

The group said these actions are being taken at a time when medical facilities are in the midst of their reaction to the COVID-19 public health emergency, which has “additional demonstrated the fractured, inadequate state of the prescription drug supply chain.” Instead of supporting the healthcare facilities taking care of neighborhoods wrecked by the public health crisis, the AHA declared these companies are trying to oblige medical facilities to divert important resources away from the pandemic.


In one of the letters, the AHA implicated Merck of gathering information intended to limit the circulation of certain 340B drugs to healthcare facilities and health systems –– which the group states violate statutory and ethical guidelines, and will negatively affect getting involved hospitals’ ability to supply care for vulnerable neighborhoods.

“The ostensible factor for these actions is to investigate whether Merck is offering duplicate discounts –– one through the 340B program and another through a state Medicaid program,” composed AHA President and CEO Richard Pollack. “Nevertheless, your business has not offered the targeted 340B hospitals with evidence to support the credibility of such an issue nor has your company obviously explored less burdensome methods to get such details if this is, in reality, a legitimate issue.”

The letters to Sanofi, Novartis, and AstraZeneca echoed much of the exact same concerns.

In its letter to Eli Lilly, the AHA implicated the business of ceasing distribution of Cialis through 340B agreement drug stores and leaving the door open up to expand this action to its products, declaring this will strain medical facilities’ capability to acquire drug therapies.

In each letter, the healthcare facility group claimed these numerous actions dispute with the statute and the Health Resources and Providers Administration’s 2010 guidance on agreement pharmacy plans.


As the medical facility industry criticizes the drug business, the federal government is criticizing the healthcare facility market. In particular, the Department of Health and Human Services, which pays all hospitals for Medicare Part B drugs, has declared medical facilities of making use of compensation inconsistencies when it concerns 340B. Simply put, HHS said that medical facilities that receive 340B drugs at a reduced price are being compensated for the drugs’ full rate, and after that using those profits to cover operational expenses.

On August 3, a federal appeals court ruled that 340B hospitals will now be subject to Medicare cuts in outpatient drug payments by nearly 30%, reversing an earlier ruling calling those cuts prohibited. The 2-1 decision by the U.S Court of Appeals for the District of Columbia Circuit essentially offers the Trump Administration and the Department of Health and Human Being Solutions the legal authority to lower payment for Medicare Part B drugs to 340B healthcare facilities.

Hospitals have pushed back and hinted that they may appeal the ruling, saying they have used the additional resources to offer important services to underserved neighborhoods during a harmful pandemic.


The AHA urged the drug business to “stop this conduct right away and to work to guarantee that 340B drugs are available and available to vulnerable communities and populations.

“340B hospitals serve communities with a high volume of low-income patients,” wrote Pollack. “For a drug business to jeopardize medical facilities’ capability to look after clients who are already under severe economic, psychological, and health-related strain during a public health crisis is unconscionable.”

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