Novo Nordisk to end 340B discounts on drugs dispensed at community pharmacies

Novo Nordisk has sent a notice to 340B member hospitals saying that starting Jan. 1 it will no longer give 340B discounts to contract pharmacies. 

If hospitals don't have an in-house pharmacy to dispense 340B-covered drugs, they can designate one contract pharmacy to receive all of its drugs covered under the program. 

Novo Nordisk is the sixth drugmaker to put such a restriction on 340B drugs, following the likes of Eli Lilly, AstraZeneca, Merck, Sanofi and Novartis. The drugmakers have said that allowing hospitals to receive 340B drugs through contract pharmacies forces the drugmakers to pay duplicate discounts on the drugs, costing them money. 

A group representing 340B member hospitals, 340B Health, said that the policy means 340B hospitals will no longer have access to discounted pricing through community pharmacies. A spokesperson for the group told Becker's that having only one contract pharmacy hurts hospitals because they often rely on several to help distribute 340B drugs. 

Novo Nordisk said the policy won't deny hospitals access to 340B-priced drugs. 

"At no time will Novo Nordisk fail to offer 340B prices to each and every 340B-covered entity," the drugmaker said. 

Novo Nordisk is one of only three insulin makers in the U.S., along with Eli Lilly and Sanofi, who have both enacted similar policies on 340B drugs. 

"The restrictions Novo Nordisk is putting in place are unconscionable, especially in light of the central role that 340B hospitals play in treating patients with diabetes," said Maureen Testoni, CEO of 340B health. "Safety-net hospitals rely on their program savings  —  including the discounts they obtain through their key partnerships with community-based pharmacies  —  to offer free or low-cost insulin as well as comprehensive disease management and education to their patients in need who are living with diabetes. Cutting off access to those crucial resources will harm the same patients whom Novo Nordisk’s top-selling products are designed to treat."

Novo Nordisk said that the 340B statute doesn't require drugmakers to provide 340B discounts to contract pharmacies. 

"The 340B statute contains no reference to 'contract pharmacies,' and there is no statutory requirement that manufacturers facilitate distribution of 340B-discounted drugs to any entity other than 340B-covered entities," a Novo Nordisk spokesperson told Becker's

In September, a group of 243 U.S. House members wrote a letter to HHS Secretary Alex Azar urging him to stop drugmakers from denying 340B discounts on drugs dispensed through community pharmacies. Several healthcare groups also sent letters to Mr. Azar, urging him to ensure drugmakers follow the rules laid out under the 340B drug-pricing program. 

A spokesperson for the Health Resources and Services Administration told Becker's in September that the agency is considering whether the drugmakers' policies violate the 340B statute. 

"We believe that manufacturers that refuse to honor contract pharmacy orders could significantly limit access to 340B-discounted drugs for many underserved and vulnerable populations who may be located in geographically isolated areas and rely on contract pharmacies as a critical point of access for obtaining their prescriptions. To this end, HRSA continues to strongly encourage all manufacturers to sell 340B-priced drugs to covered entities directly and through contract pharmacy arrangements," the spokesperson said. 

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