340B Archives - HEALTH & LIFE SCIENCES NEWS

This Week in 340B: January 7 – 13, 2025

by Emily Jane Cook and Jae Hyun Lee | Jan 15, 2025 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: Contract Pharmacy; Other

In two appealed cases challenging a proposed Louisiana law governing contract pharmacy arrangements, the appellants filed their opening brief.
In a breach of contract case related to the Medicare 340B cuts, the court terminated the action without prejudice.

Matt David, associate in McDermott’s Los Angeles office, also contributed to this blog post.

This Week in 340B: December 17, 2024 – January 6, 2025

by Emily Jane Cook, Reuben Bank, Margaret Houtz, Patrick Moore, Deepika Raj and Kelsey Reinhardt | Jan 9, 2025 | 340B

Find updates on 340B litigation from December 17, 2024 – January 6, 2025 to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: HRSA Audit Process, Contract Pharmacy; Other

In a Health Resources and Services Administration (HRSA) audit process case, the government filed a brief in opposition to the plaintiff’s motion for preliminary injunction and the plaintiff filed a reply brief in support of the same motion.
In four HRSA audit process cases, the plaintiffs filed responses to the defendants’ motions to dismiss and briefs in opposition to Johnson & Johnson Health Care System Inc.’s motions for leave to file as amicus curiae.
In an appealed case challenging a proposed state law governing contract pharmacy arrangements, the appellants filed their opening brief.
In a breach of contract claim filed by a 340B Covered Entity against several related party Medicare Advantage plans, plaintiffs filed a second amended complaint under seal with jury demand. Additionally, defendants filed an answer and defenses to plaintiffs’ second amended complaint
In a case challenging HRSA’s policy prohibiting manufacturer rebate models, defendants filed a consent motion to [...]

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This Week in 340B: December 10 – 16, 2024

by Emily Jane Cook, Reuben Bank, Margaret Houtz, Patrick Moore, Deepika Raj and Kelsey Reinhardt | Dec 18, 2024 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: Contract Pharmacy; HRSA Audit Process; Other

A drug manufacturer filed suit against the Health Resources and Services Administration (HRSA) to challenge HRSA’s determination that its proposed rebate model violates the 340B statute.
In two HRSA audit process cases, HRSA filed a motion to dismiss for a lack of subject-matter jurisdiction and failure to state a claim.
In a breach of contract claim filed by a 340B Covered Entity against several related party Medicare Advantage plans, defendants filed a notice of non-opposition, and the court granted plaintiff’s motion for leave to file a second amended complaint and motion to file the second amended complaint under seal.
In an appealed qui tam action alleging that various drug manufacturers failed to charge accurate ceiling prices to 340B Covered Entities, the appellant filed a reply brief.
In four consolidated Kansas contract pharmacy cases, the parties filed a joint stipulation of dismissal without prejudice.
In eight cases challenging a proposed state law governing contract pharmacy arrangements in West Virginia, [...]

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This Week in 340B: December 3 – 9, 2024

by Emily Jane Cook, Reuben Bank, Patrick Moore, Deepika Raj and Kelsey Reinhardt | Dec 11, 2024 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: HRSA Audit Process; Contract Pharmacy; Other

In a Freedom of Information Act (FOIA) case, the Health Resources and Services Administration (HRSA) filed a reply in support of its cross-motion for partial summary judgment.
In a breach of contract claim filed by a 340B Covered Entity against several related party Medicare Advantage plans, the 340B Covered Entity filed a motion for leave to file its second amended complaint and the court ordered that the related party Medicare Advantage plans show cause why the motion for leave should not be granted.
In one HRSA audit process case, the plaintiff filed a motion for stay of agency action and preliminary injunction.
In two HRSA audit process cases, HRSA filed a motion to dismiss for a lack of subject-matter jurisdiction and failure to state a claim.
In a case challenging HRSA’s policy prohibiting all manufacturer conditions on 340B transactions, the court approved the parties’ motion for leave to file an amended complaint.
In four cases challenging a proposed [...]

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This Week in 340B: November 19 – December 2, 2024

by Emily Jane Cook, Reuben Bank, Patrick Moore, Deepika Raj and Kelsey Reinhardt | Dec 4, 2024 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: HRSA Audit Process; Contract Pharmacy; Other

In four Health Resources and Services Administration (HRSA) audit process cases, the plaintiffs filed motions for a temporary restraining order.
In four HRSA audit process cases, the courts approved a joint motion to withdraw the plaintiff’s previously-flied motion for a temporary restraining order.
In a Freedom of Information Act (FOIA) case, the drug manufacturer plaintiff filed a reply in support of its motion for summary judgment and opposition to defendants’ motion for partial summary judgment.
A drug manufacturer filed suit against HRSA to challenge HRSA’s disapproval of its proposed rebate model.
In eight cases challenging proposed state laws governing contract pharmacy arrangements in West Virginia and Missouri:
- WV: The court in four separate cases granted the parties’ joint motions and stipulations to delay proceedings for fourteen days to allow related courts to decide pending preliminary injunction motions in similar cases.
- MO: In two cases, the plaintiff filed suggestion in opposition to intervenor’s motion to [...]
  
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California Ballot Proposition 34 Targets Spending by Certain 340B Covered Entities

by Emily Jane Cook and Patrick Moore | Nov 20, 2024 | 340B

Proposition 34 requires certain California healthcare providers to spend at least 98% of their net drug sale revenue on direct patient care. The measure targets certain providers who benefit from a federal drug discount program known as the 340B Program.

The 340B Program allows qualifying safety net healthcare providers who serve a disproportionate share of low-income and uninsured patients to purchase outpatient drugs at a significant discount. The intent of the 340B Program is to allow providers that participate in the program to offer more comprehensive services to patients and their communities.

The 340B Program does not dictate how eligible providers use revenue generated from sales of the discounted drugs. Proposition 34 imposes such restrictions.

Who Does It Affect?

Not all providers who participate in the 340B Program are affected by Proposition 34. It only applies to 340B providers that:

Spend more than $100 million on non-direct-care expenses.
Own and operate apartment buildings.
Have accumulated at least 500 severe health and safety violations in the past decade.

Currently, the AIDS Healthcare Foundation (AHF) is believed to be the only organization that meets these criteria.

Background and Controversy

Proposition 34 is one of the first state-level efforts to restrict use of savings generated from participation in the 340B Program. Opponents of Proposition 34 believe that it was on the ballot largely due to political and housing interest groups’ opposition to the president of AHF and certain spending by AHF under his leadership. AHF has become a significant player in [...]

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This Week in 340B: October 15 – 21, 2024

by Emily Jane Cook, Reuben Bank, Margaret Houtz, Jae Hyun Lee and Patrick Moore | Oct 23, 2024 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: Contract Pharmacy; Other

In an appealed qui tam action alleging that various drug manufacturers failed to charge accurate ceiling prices to 340B Covered Entities, the appellees filed an answering brief.
In nine cases challenging proposed state laws governing contract pharmacy arrangements in Mississippi, Louisiana, Minnesota, West Virginia and Missouri:
- LA: The plaintiff filed an appeal.
- MN: The defendant in two related cases filed a reply in support of their motion to dismiss.
- WV: The defendant in three cases filed notices of supplemental authority
- MO:
  - In one case, three amici filed a motion for leave to file an amicus brief with the court, defendants filed a memorandum in support of their motion to dismiss, two intervenors filed a verified motion to intervene and suggestions in support, and plaintiffs filed a response to defendant’s motion to dismiss.
  - In another case, plaintiffs filed a response to defendant’s motion to transfer.
- MS: The defendant filed a reply in opposition to the plaintiff’s motion for [...]
  
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This Week in 340B: October 8 – 14, 2024

by Emily Jane Cook, Jae Hyun Lee, Deepika Raj and Kelsey Reinhardt | Oct 17, 2024 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker.

Issues at Stake: Contract Pharmacy

In eight cases challenging proposed state law governing contract pharmacy arrangements, in Louisiana, Missouri, Minnesota, and Kansas:
- LA: the Plaintiff filed an appeal.
- MO: amici filed a motion for leave to file an amicus brief in one case and Defendants filed a reply in support of its motion to transfer venue.
- KS: the court filed an order to consolidate all contract pharmacy cases for discovery purposes only.
- MN: the Plaintiffs in each of two cases filed an opposition to Defendant’s motion to dismiss.

Loper Bright and the 340B Statute

by Emily Jane Cook | Jul 11, 2024 | 340B

In its Loper Bright decision last week, the Supreme Court of the United States likely opened opportunities for further legal challenges to the Health Resources and Services Administration’s (HRSA’s) interpretation and application of the 340B statute. Going forward, we expect that much of the 340B statute will be subject to interpretation by federal courts.

HRSA’s historic policies that are not the “best” interpretation of the statutory language may not survive legal challenges. Where HRSA retains the authority to regulate the 340B program, it will be required to demonstrate that it is acting based on “reasoned decision-making.”

Examples of what the application of the new Loper Bright standard might look like in practice, as applied to provisions in the 340B statute:

Definition of “Patient”: The 340B statute does not define “patient.” The 340B statute states in relevant part that “a covered entity shall not resell or otherwise transfer the drug to a person who is not a patient of the entity.” Under Loper Bright, a court will likely decide, without deference to HRSA, who qualifies as a patient. A court is not required to defer to HRSA’s statutory interpretation.
Requirements for Registration of DSH Hospital Child Sites Prior to Use of 340B Drugs: The 340B statute defines disproportionate share hospital (DSH) hospital covered entities as “a subsection (d) hospital (as defined in section 1886(d)(1)(B) of the Social Security Act) that [meets certain additional requirements set forth in the statute related to ownership, DSH percentage and GPO purchasing].” The 340B statute [...]

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This Week in 340B: January 31 – February 7, 2024

by Emily Jane Cook, Bryan Frederick and Patrick Moore | Feb 9, 2024 | 340B

Find this week’s updates on 340B litigation to help you stay in the know on how 340B cases are developing across the country. Each week we comb through the dockets of more than 50 340B cases to provide you with a quick summary of relevant updates from the prior week in this industry-shaping body of litigation. Get more details on these 340B cases and all other material 340B cases pending in federal and state courts with the 340B Litigation Tracker, a subscription product from McDermott+Consulting.

Issues at Stake: Contract Pharmacy; Other

In a qui tam False Claims Act action alleging that defendants failed to charge accurate ceiling prices to 340B Covered Entities, the plaintiff-relator submitted a memorandum in opposition to the defendants’ renewed request for judicial notice and an omnibus opposition to defendants’ motion to dismiss the first amended complaint.
In a case regarding a state law governing contract pharmacy arrangements, the oral argument for defendant’s motion to dismiss was set for March 5, 2024.
In a separate case regarding a state law governing contract pharmacy arrangements, the court denied plaintiff’s motion to file a second amended complaint, ordered the clerk to close the case, and issued a judgment in favor of Defendant pharmaceutical companies.

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