Following Eli Lilly and Johnson & Johnson, Sanofi is aiming to change how it participates in the 340B program, a federal drug pricing program created in 1992, The Wall Street Journal reported Nov. 22.
340B compels drugmakers to offer discounted medications to healthcare facilities serving low-income and uninsured patients. Currently, pharmaceutical companies provide these discounts at the point of purchase. Now, three drugmakers want to implement a different structure.
The Health Resources and Services Administration, which oversees 340B, is pushing back.
The fight began in August, when Johnson & Johnson said it would end upfront discounts for two medications: Xarelto, a blood thinner, and Stelara, an anti-inflammatory. J&J planned to launch a rebate application process Oct. 15, but after HRSA declared the plan illegal and several healthcare organizations criticized it, J&J bowed out Sept. 30.
About six weeks later, J&J filed a lawsuit against HHS and HRSA, arguing the rebate plan is legal. Eli Lilly soon filed a similar lawsuit about its rebate plan, which would require 340B entities to pay full price for drugs before receiving weekly cash rebates.
Sanofi told safety-net entities Nov. 22 it will roll out a new 340B plan in early 2025, according to WSJ. The plan requires certain hospitals to submit claims data that demonstrates eligibility in the program before the France-based drugmaker provides credit. Hospitals would have these credits before they buy drugs from wholesalers, the report said.
The American Hospital Association criticized Sanofi's plan, saying it undermines the program's integrity. Sanofi argued the 340B program "bears little resemblance" to its original purpose and said the new model would "rein in the 340B waste and abuse."
Sanofi's plan would affect more than 20 medications.
In recent years, the number of participants in the 340B program has grown rapidly. In 2004, 657 federally qualified health centers were in the program. By 2021, this increased to 1,280, according to a recent study. More pharmacies are also participating. The proportion of retail pharmacies participating grew from 1% in 2010 to over 40% by 2022.
Opponents to these changes argue they will create financial strain and hinder care for vulnerable populations.