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Bipartisan Bill Introduced to Close 340B Orphan Drug Loophole

September 30, 2016

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PRESS CONTACTS
Jason Kleinman, Senior Legislative Analyst, Govt. Relations

Representatives Morgan Griffith (R-Va.) and Peter Welch (D-Vt.) Sept. 27 introduced the Closing Loopholes for Orphan Drugs Act (H.R. 6174), legislation that would limit the 340B Drug Pricing Program’s orphan drug exclusion.

The Affordable Care Act (ACA, P.L. 111-148 and P.L. 111-152) expanded the 340B program to include several new categories of eligibility, including critical access hospitals, rural referral centers, sole community hospitals, and free-standing cancer hospitals. However, for these covered entities, the ACA excluded orphan drugs from the definition of covered outpatient drugs, even when the drug is used to treat non-orphan diseases or conditions. This bipartisan bill would limit the orphan drug exclusion to allow these institutions to be eligible for 340B pricing on orphan drugs when they are used for any purpose other than the orphan condition for which the drug was originally designed.

In a press release, Rep. Griffith noted, “Congressman Welch and I have clarified the scope and intent of the designation for which drugs are excluded from the 340B Pricing program, which will enable hospitals and rural health centers to provide the best possible care options for our country’s most vulnerable patients.” Rep. Welch added that this bill “would restore the original intent of Congress and close this loophole.”

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