Drug manufacturers that charge 340B participants higher rates than those established by the 340B Drug Pricing Program will potentially be subject to monetary sanctions, according to a proposed rule released by the Health Resources and Services Administration (HRSA). The proposed rule would also require greater transparency in the calculation of ceiling prices to help determine whether drug manufacturers are overcharging 340B hospitals and other covered entities.

Separate from this proposed rule, HRSA will also release subregulatory guidance addressing the 340B Drug Pricing Program. It will serve in a similar capacity as the 2014 mega reg would have, which was to be comprehensive and address a variety of components of the program. The mega reg was withdrawn from the Office of Management and Budget in 2014 due to concerns about HRSA’s regulatory authority.

The 340B Drug Pricing Program requires drug manufacturers participating in the Medicaid Program to sell drugs used for outpatient purposes at reduced prices for hospitals and other providers that care for a disproportionate share of vulnerable patients. To receive these rates, hospitals must register for the program and complete annual recertification. The next registration window is open July 1 to July 15.

Contact Zina Gontscharow, MPP, policy analyst, at zgontscharow@essentialhospitals.org or 202.585.0113 with questions.