December 16, 2010—The Health Resources and Services Administration (HRSA) plans to send an email message to drug manufacturers shortly informing them of legislation that President Obama signed last night restoring children’s hospitals’ ability to buy orphan drugs at 340B-discounted prices.
HRSA will also send email messages to children’s hospitals and other affected stakeholders and post a link to the measure on its Web site. The U.S. House approved the bill, H.R. 4994, on Dec. 9 and the Senate passed it a day earlier.
“We share the concerns regarding children’s hospitals and the 340B program, and support this technical correction by the Congress,” HRSA told the Monitor on Dec. 13 in response to questions about how it will implement the measure. The new law, it said, “will preserve access to discounted medications for more vulnerable Americans.”
Guidance “as Necessary”
HRSA said it will “continue to work with children’s hospitals and manufacturers” and issue guidance on the new law “as necessary.”
At least six manufacturers recently began denying the discounts to children’s hospitals, as well as to rural and cancer hospitals that were added to the drug discount program under health care reform. The new law left the prohibition in place for the latter two categories. Hospital groups are continuing to urge Congress to lift the ban for these institutions. They have also sent letters to the six manufacturers asking that they resume the discounted sales pending guidance from HRSA. The agency said it will issue that guidance “in the coming weeks.”
Watchful Waiting
The new law requires manufacturers to provide 340B discounts on orphan drugs to children’s hospitals as if the prohibition on such discounts had never been included in health reform.
“Once the law has been signed by the President, HRSA will post the links to the new law, gauge the activities in the marketplace, and ensure compliance with the new statutory provision,” the agency said.
When asked whether manufacturers that have been denying discounts to children’s hospitals are now obligated to provide them retroactively, HRSA replied, “manufacturers are required to follow the law as passed by Congress.”
“HRSA will reach out to the affected stakeholders for comments and recommendations, gauge the activities in the marketplace, and issue guidance as necessary,” it said.
“No Discontinuity”
In remarks on the House floor Dec. 9, Rep. Henry Waxman (D-Calif.), the outgoing chairman of the Energy and Commerce Committee, noted that the language in H.R. 4994 restoring children’s hospitals’ access to 340B pricing on orphan drugs is “retroactive as if included in” health care reform.
“The intent of this retroactivity is to clarify congressional intent that there be no discontinuity in access to orphan drugs at 340B prices for children’s hospitals,” he said. “To the extent that drug manufacturers have not provided these discounts at any point between the enactment of [health care reform] and the enactment of this legislation, they should do so retroactively, subject to HRSA or any other compliance or enforcement authority.”