The AAMC sent a letter to Department of Health and Human Services (HHS) Secretary Robert F. Kennedy Jr. outlining the association’s concerns with 340B rebate models (PDF) proposed by five drug manufacturers and cautioning the department against adopting rebate models in upcoming guidance. In a May 2 notice filed with the U.S. District Court for the District of Columbia the HHS announced it would be issuing guidance related to 340B rebate models by June 2 (PDF). In anticipation of the upcoming guidance, the AAMC submitted this letter to Kennedy, which stressed that the proposed rebate models are unlawful under the 340B statute, usurp the Health Resources and Services Administration’s oversight responsibilities, and are financially and operationally disruptive to 340B hospitals.
Beginning last August, five drug manufacturers announced their intention to provide 340B pricing as retrospective rebates instead of upfront discounts. But the HHS prohibited the manufacturers from implementing their rebate models without prior HHS approval, which led to the five manufacturers suing the department in federal court [refer to Washington Highlights, Nov. 22, 2024]. Earlier this year, the AAMC joined other hospital associations in submitting an amicus brief in support of the HHS and urging the court to block 340B rebate models [refer to Washington Highlights, March 7].
The court ultimately ruled (PDF) that the manufacturers could not unilaterally implement rebate models without prior HHS approval, placing the onus on HHS to decide whether to allow 340B rebate models.