HHS Issues Interpretive Rule Allowing 340B Orphan Drug Exclusion

The HHS Health Resources and Services Administration has issued an interpretive rule that will continue allowing rural and cancer hospitals to access 340B drug program discounts on orphan drugs when the drugs are not used for the rare conditions that resulted in orphan designation.

The interpretive rule intends to provide clarity in the marketplace, maintain 340B savings for newly-eligible entities and protect the financial incentives for manufacturing orphan drugs. The rule follows HRSA's filing earlier this month of a document with the U.S. District Court for the District of Columbia confirming the agency will stand by a previous final rule allowing rural and cancer hospitals to access the orphan drug discounts when the drugs aren't used for the conditions that resulted in their orphan designation.

The HRSA filed the document in response to a June 19 motion filed by the Pharmaceutical Research and Manufacturers of America challenging the agency's position, which was originally posted in June on the HRSA website. PhRMA had  filed a lawsuit seeking to exclude all drugs with an "orphan" designation — a drug that has been developed specifically to treat a rare condition and often carries a hefty price tag — from a final rule from HHS. Hospital associations, including the American Hospital Association and Safety Net Hospitals for Pharmaceutical Access, have supported HHS in the suit.

In May, U.S. District Judge Rudolph Contreras ruled in favor of PhRMA, finding that HHS does not have the authority to implement regulations implementing PPACA 340B provisions. However, HRSA stated on its website that "the Court did not invalidate HRSA's interpretation of the statute. HHS/HRSA continues to stand by the interpretation described in its published final rule, which allows the 340B covered entities affected by the orphan drug exclusion to purchase orphan drugs at 340B prices when orphan drugs are used for any indication other than treating the rare disease or condition for which the drug received an orphan designation."

More Articles on the 340B Program:
HHS Stands by 340B Drug Discount Policy
HHS to Allow 340B Discounts Despite Court Ruling
HHS Considers Response to 340B Orphan Drug Exclusion Ruling 


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