The 340B “Mega-Reg” Is Gone, But Not Forgotten

Parting is such sweet sorrow. So says William Shakespeare in Romeo and Juliet. The Health Resources and Services Administration (HRSA) would no doubt agree with old Bill when it comes to the 340B Program’s proposed “mega-reg.” HRSA recently decided that the regulation that would have provided comprehensive 340B program guidance for hospitals and manufacturers would face insurmountable odds of implementation in light of the orphan drug ruling by the courts that found that HRSA has limited rule-making authority. As a result, HRSA has withdrawn the “mega-reg” and will revisit guidance later in 2015.

HRSA’s intention with the “mega-reg” was to provide clarifying guidance on the implementation of a 340B program. Manufacturers and federal officials were concerned that the program was being taken advantage of by health systems and that the original intent of the program (providing access to pharmaceuticals for those individuals who would otherwise not be able to afford them) was being lost to the chase for more program savings by those same health systems. The “mega-reg” would have addressed hospital eligibility, patient eligibility, and contract pharmacy guidelines, among others. Not to be deterred, HRSA has indicated its intention to pick up the same issues in 2015. HRSA, on its website, states it plans “to issue a proposed guidance for notice and comment that will address key policy issues raised by various stakeholders committed to the integrity of the 340B program. HRSA is also planning to issue proposed rules pertaining to civil monetary penalties for manufacturers, calculation of the 340B ceiling price, and administrative dispute resolution.”

Health systems and pharmaceutical manufacturers should fully prepare for the eventuality of clarifying guidance from HRSA in 2015. Given the lobbying by manufacturers for more restrictive guidance and the increased focus on the part of federal officials, the push for more comprehensive regulations will only increase in intensity. The “mega-reg” itself may be gone, but its goals of more detailed program guidance are surely not forgotten. Prepare now with program assessments and minimize transition challenges when the guidance is issued.