Industry’s Changes to 340B Drug Discount Program

By: Brandon M. Macsata, CEO, ADAP Advocacy Association, and Jen Laws, President & CEO, Community Access National Network (CANN)

The Community Access National Network (CANN) and ADAP Advocacy Association, back in October 2020, issued a Dear Colleague letter to our industry partners in the pharmaceutical manufacturing space surrounding HIV therapies. We detailed our concerns regarding the 340B Discount Drug Program and the necessity to ensure safety-net public health programs do not “get caught in the crossfire between pharmaceutical companies and contract pharmacies.” Our efforts led to constructive conversation, as well as a commitment to protect patients access to timely, appropriate care and treatment. Essentially, we sought a “carve out” for certain Covered Entities, namely the Ryan White Grantees (“Grantees”) serving clients living with HIV/AIDS. 

Photo Source: CANN

In the time since, considering our collective concerns for the sustainability, stability, and honest efforts to provide necessary services to PLWAHA, many of our industry partners have ensured additional efforts at transparency and accountability do not add to already existing reporting burdens of the Grantees. We still contend that the carve-out is essential to avoiding possible damaging effects on the safety-net programs crucial to the HIV-positive community.

Unfortunately, a few of our industry partners have express concerns about “bad actors” trying to encroach on the federal grantee carve-outs industry partners have thus far offered in requesting additional reporting of 340B Covered Entities. It has been our earnest position that solving the problems facing the 340B Drug Discount Program are achieved in a way that preserves benefit to patients and intent of the program while protecting against bad actors. However, any effort requires a scalpel, not a hatchet. The carve-out of these additional reporting requirements, in light of the oversight already offered by being federal grantees, has helped our industry partners align their values with their actions in working to ensure program integrity and minimize risks to patient benefit. 

It is important to recognize the historical and current reality many Grantees face. Yet, should pharmaceutical manufacturers insist on blanket reporting requirements for all Covered Entities void of any carve-outs, it should be done by supporting these Grantees, and thus the services and medications their patients rely upon. We urge our industry partners to pair any new reporting requirements with funding for the following activities:

• necessary expertise to navigate the establishment of third-party administrator and contract pharmacy agreements.
• extend program initiation funding for the 3 years after qualification to meet the labor needs of fulfilling this reporting requirement.
• develop other programming clinics specifically identify to work collaboratively.

Whereas our two organizations have long-supported reforms to the 340B Drug Pricing Program, because they are overdue and opportunities exist to ensure every single penny squeezed out of the program directly benefits patients, let’s not throw the baby out with the bathwater. Provided our industry partners are genuine in their expression and desire to preserve 340B’s intent to benefit patients, the aforementioned steps are modest and support appropriate transparency and accountability.

Respectfully, we believe any genuine effort to introduce added reporting burden on Grantees, of which are already most closely monitored in the 340B space, must also include support to meet these burdens. Any adjustments to Grantees’ reporting supported by funding and programming designed for Grantees to be “set up for success” on all accounts. We believe our industry partners are up to the task at hand and maintain the integrity to align actions and values.

Disclaimer: Guest blogs do not necessarily reflect the views of the ADAP Advocacy Association, but rather they provide a neutral platform whereby the author serves to promote open, honest discussion about public health-related issues and updates.