The Health Resources and Services Administration issued a stern warning to Johnson & Johnson on Sept. 17, stating the company's plans to impose 340B rebates on certain drugs are in violation of federal law.
The agency's letter demanded that J&J halt its plans, warning failure to comply could result in steep fines or loss of access to the Medicaid and Medicare drug markets, according to a news release 340B Health shared with Becker's.
An J&J spokesperson told Becker's, "J&J is committed to the 340B Program as it was originally intended to serve as an important safety net program for vulnerable patients. Transparency is vital to ensure that 340B discounts are benefiting patients. We will continue to constructively engage with HRSA on the 340B program to identify solutions that help modernize the program for a more sustainable future."
J&J's proposed policy, set to take effect Oct. 15, would prevent certain hospitals from accessing 340B discounts for Stelara and Xarelto. Instead, the hospitals would be required to purchase the drugs at wholesale acquisition cost and later submit claims to J&J for potential rebates.
HRSA rejected this approach, stating that it would force hospitals to pay more than the 340B ceiling price, in violation of the program's regulations.