A federal judge in the U.S. District Court for the District of Columbia ruled June 27 to reject pharmaceutical manufacturer Johnson & Johnson’s (J&J’s) claim that it could unilaterally implement rebate models for the 340B Drug Pricing Program.
The decision broadly echoes a May 15 decision for four other manufacturers, in which a judge determined the Department of Health and Human Services has authority to preapprove 340B rebates. J&J declined to join these manufacturers in a hearing and was the sole manufacturer with an outstanding case. In the June 27 ruling, the judge determined 340B statute clearly allows the Health Resources and Services Administration the authority to “provide” alternative 340B program arrangements, which means the agency acted properly when it threatened significant sanctions against the manufacturer if it implemented the rebate model.
The decision upholds the government’s position that it has the authority to oppose unilateral changes to the 340B program and notes the court “struggles to understand the necessity of J&J’s rebate model.” However, the judge declined to uphold an argument from an intervening defendant that argued any rebate model is contrary to 340B statute. The decision notes that America’s Essential Hospitals’ amicus brief “provided helpful context” to the court.
Contact Director of Policy Rob Nelb, MPH, at rnelb@essentialhospitals.org or 202.585.0127 with questions.
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