The AAMC on Aug. 5 joined the American Hospital Association, Children’s Hospital Association, and America’s Essential Hospitals to file an amicus brief in the U.S. Court of Appeals for the D.C. Circuit supporting the Health Resources and Services Administration’s (HRSA’s) authority to prevent drug companies from implementing 340B rebate models (PDF). This brief was filed as part of a consolidated appeal in which five drug companies (Johnson & Johnson, Bristol Myers Squibb, Eli Lilly, and Novartis, and Sanofi) appealed the ruling by the U.S. District Court that drug manufacturers must obtain preapproval from HRSA before implementing rebate models under the 340B program [refer to Washington Highlights, Nov. 14, 2025, Nov. 22, 2025, March 7].
The brief stated that as the drug companies seek to boost their profits, these rebate policies “will devastate safety-net hospitals, vulnerable patients, and the struggling rural and urban communities they serve.” The brief further described how “the rebate policies will require hospitals to float significant sums to drug companies,” and “hospitals have reported that they, in turn, will have to restrict or close healthcare services lines, thus directly harming the patients that the 340B program is supposed to help.” The brief urged the court to rule that the 340B statute itself bars the drug company rebate models at issue in the case.
The 340B Drug Pricing Program requires pharmaceutical manufacturers to provide outpatient drugs at discounted prices to health care providers that care for many uninsured and low-income patients. Hospitals use 340B savings to expand health services to the patients and communities they service.