HHS and Congress Slam Big Pharma’s Actions Against 340B

In response to Big Pharma’s recent unprecedented attacks on the 340B Drug Discount Program, Congress and the Department of Health and Human Services have put the manufacturers on notice that their actions may be formally rebuked by the federal government.

HHS General Counsel Robert Charrow broke months of public silence from the agency with a pointed Sept. 21 letter to drug behemoth Eli Lilly. In it, he warned the company not to assume the agency approved of Lilly’s move to stop legally required discounts to hospitals and clinics in the 340B Drug Discount Program.

“Lilly cannot and should not view the absence of any questions from the government as somehow endorsing Lilly’s policy especially when the Department is leading the government’s response to the … pandemic,” wrote Charrow. Rather, the agency is still evaluating how to proceed on Lilly’s unilateral actions, Charrow said. (The drug companies AstraZeneca, Merck and Sanofi have also made moves to block or delay 340B discounts.)

Lilly and AstraZeneca stopped providing medicines at reduced prices to health providers that ship them on to contracted pharmacies. The practice has been central to the 340B program for more than a decade and helps get medicines to needy patients more conveniently. As well, the savings on the drugs are essential to helping safety-net providers guarantee access to uninsured and underinsured patients.

Charrow’s letter comes after a coordinated campaign by hospitals, clinics and their members of Congress to get Azar and the Health Resources Services Administration (which officiates 340B) to hold the drug companies accountable.

On Sept. 14, 243 House members wrote Azar bluntly: “The actions of these companies violate the 340B statute and must be rejected. A failure to act will serve as an invitation to other manufacturers to follow suit, leading to a wholesale increase in prescription drug costs for our safety-net providers during a public health emergency. We urge you to use your authority to address these troubling actions and require these companies to comply with the law.”

The letter, which includes both Democratic and Republican signatories, represents more than half of the House of Representatives. A separate Sept. 3 letter demanding the same of Azar was sent by Rep. Frank Pallone (D-NJ), chairman of the House Committee on Energy and Commerce.

There have also been Senate letters. A bi-partisan group of 28 senators wrote Azar on Sept. 17: “We call on [the Health Resources and Services Administration] to take appropriate, prompt enforcement action to address violations of the Public Health Service Act.” Sen. Joe Manchin (D-WV) wrote his own missive to the HHS secretary on Sept. 15. And 22 senators wrote an unhappy letter directly to PhRMA CEO Stephen Ubl.

Charrow’s letter shows HHS is finally paying attention. And he makes clear his displeasure with Lilly’s actions during a pandemic. “Many Americans and many small businesses have had difficulty making ends meet. Lilly, on the other hand, seems to be enjoying an outstanding year … Your company’s comprehensive income jumped from $1.414 billion during the second quarter of 2019 to $1.615 billion for the second quarter of 2020, an increase of more than 14 percent.”

Now Charrow needs to stop evaluating and hold Lilly and AstraZeneca accountable for breaking the law.