Madam Speaker, I thank the gentlewoman from Virginia for yielding me time to speak on this very important and lifesaving program as we commemorate the 30th anniversary of the creation of the 340B program. I applaud the gentlewoman from…
Madam Speaker, I thank the gentlewoman from Virginia for yielding me time to speak on this very important and lifesaving program as we commemorate the 30th anniversary of the creation of the 340B program.
I applaud the gentlewoman from Virginia for her leadership on this issue and for organizing this opportunity for Members on both sides to speak about how important this issue is to each of our districts.
I also thank the other Members here tonight and those who routinely support the 340B program. More than 220 Members of the House recently joined a letter to Health and Human Services, urging the Department to crack down on drug companies denying 340B discounts. By having such a large group of Members in support of that letter, to which I proudly lent my name, we demonstrated the broad bipartisan support the 340B program enjoys across the entire country.
Madam Speaker, I include the text of that letter in the Record.
Congress of the United States,
House of Representatives,
Washington, DC, February 26, 2021.
Acting Secretary Cochran,
Department of Health and Human Services,
Washington, DC.
Dear Acting Secretary Cochran: We write today as leading
congressional proponents of the 340B drug discount program to
ask you to take immediate action to ensure that manufacturers
are prohibited from imposing unilateral changes to the
program in direct conflict with congressional intent and
decades of written guidance.
We were pleased to see 28 attorneys general urge former HHS
Secretary Azar to protect the 340B programs. We believe that
letter and the Department's Office of General Counsel's
advisory opinion, released on December 30 and described
below, represent some of the most compelling legal arguments
for the actions we ask you to take.
As you know, Congress enacted the 340B Drug Pricing Program
in 1992 following the creation of the Medicaid Drug Rebate
Program. In order for their drugs to be covered by Medicaid,
manufacturers are required to offer discounts to certain
public and nonprofit health care organizations known as
covered entities, including Federally Qualified Health
Centers, Ryan White HIV/AIDS Clinics, Medicare/Medicaid
Disproportionate Share hospitals, rural hospitals, and
children's hospitals. According to the legislative history,
Congress's intent in creating the discount program was to
``stretch scarce federal resources to reach more eligible
patients and provide more comprehensive services.''
The 340B statute requires drug manufacturers to ``offer
each covered entity covered outpatient drugs for purchase at
or below the applicable ceiling price.'' There are no
provisions in the statute that allow manufacturers to set
conditions or otherwise impede a provider's ability to access
340B discounts. The Health Resources and Services
Administration (HRSA), which oversees the program, has
indicated on multiple occasions, dating back to the early
years of the program, that the 340B statute requires
manufacturers to provide 340B discounts to covered entities
when covered entities purchase drugs to be dispensed through
contract pharmacies on a covered entity's behalf.
Beginning in the summer of 2020, several drug manufacturers
began to announce a range of actions to avoid honoring 340B
discounts for certain drugs, many with the highest prices,
delivered to covered entities' contract pharmacies. Some
manufacturers have announced they will no longer ship
discounted drugs to contract pharmacies; others will ship to
only one contract pharmacy per covered entity.
HHS has reviewed manufacturers' refusals to provide 340B
discounts to covered entities' contract pharmacies and found
them to be unlawful. In a December 30th 2020 advisory
opinion, then-general counsel Robert Charrow wrote, ``[T]he
core requirement of the 340B statute . . . is that
manufacturers must ``offer'' covered outpatient drugs at or
below the ceiling price for ``purchase by'' covered entities.
This fundamental requirement is not qualified, restricted, or
dependent on how the covered entity chooses to distribute the
covered outpatient drugs.''
Unfortunately, publishing the advisory opinion has not
deterred manufacturers from continuing with unlawful price
hikes. Many covered entities are struggling with severe
financial losses as a result of the COVID-19 pandemic. They
cannot afford to be unfairly targeted by large pharmaceutical
corporations or be forced to pay higher up-front costs for
the drugs their patients need.
Furthermore, an information technology company has allied
with manufacturers to change the 340B program from one of
upfront discounts to post-sale rebates, a change that would
greatly increase costs for covered entities and give
manufacturers tremendous leverage over covered entities. Such
action is inconsistent with HRSA's long-standing guidance
that the 340B program is an up-front discount program.''
The December 14th letter from the attorneys general called
on HHS to ``address drug manufacturers' unlawful refusal to
provide critical drug discounts to covered entities.''
Consistent with that letter, we urge you to:
1. Begin assessing civil monetary penalties on
manufacturers that deny 340B pricing to
covered entities in violation of their obligations under the
340B statute;
2. Require manufacturers to refund covered entities the
discounts they have unlawfully withheld since 2020;
3. Halt, through guidance or other means, any attempt to
unilaterally change 340B upfront discounts to post sale
rebates; and
4. Immediately seat the Administrative Dispute Resolution
Panel to begin processing disputes within the program.
As the attorneys general stated in their December 14th
letter, ``Each day that drug manufacturers violate their
statutory obligations, vulnerable patients and their health
care centers are deprived of the essential healthcare
resources Congress intended to provide.'' Thank you very much
for your prompt consideration of these important matters.
Madam Speaker, even though the 340B program has received such overwhelming support from Members of Congress, multiple administrations, hospitals, doctors, pharmacists, and patients, it still finds itself struggling to survive from relentless efforts to undermine its existence by some pharmaceutical companies refusing to abide by the law. HHS must take immediate enforcement action against all of these noncompliant drug companies.
As many of us here tonight understand, the 340B program is an important avenue for offering lower drug prices for our most vulnerable citizens. It is often a lifeline of financial support for the small, rural hospitals in middle Tennessee and across the country. These very same hospitals are often the only source of care for communities in expansive geographic areas.
I have no other word to describe it other than ``unconscionable'' that companies founded to help sick patients by providing lifesaving medication deliberately undermine a law to increase affordable access to their lifesaving medications. It is truly disgraceful.
Tonight, we are going to hear more about this malpractice. I hope by highlighting this issue here on the floor of the U.S. House of Representatives, we will encourage other Members of the House and the Senate to take immediate and decisive action to protect the 340B program.
Madam Speaker, I want to talk a little more about the importance of H.R. 4390, the PROTECT 340B Act of 2021, which was introduced by the gentleman from West Virginia (Mr. McKinley), my friend, and is co-led by the gentlewoman from Virginia (Ms. Spanberger), the lead organizer of this Special Order.
Passage of the PROTECT 340B Act of 2021 is essential in order to push back against recent attacks on the 340B program.
This bill would prohibit pharmacy benefit managers, otherwise known as PBMs, from discriminating against 340B providers or their contract pharmacies.
The PROTECT 340B Act is supported by America's Essential Hospitals, 340B Health, National Association of Community Health Centers, and Ryan White Clinics for 340B Access. To ensure PBMs are held accountable, it allows the HHS Secretary to impose civil monetary penalties.
This is the definition of a good bill. It has broad, bipartisan support in the House as well as among outside groups, and it even has an enforcement mechanism that hits the bad actors where it hurts them most--their pocketbooks.
Madam Speaker, again, I thank the gentlewoman from Virginia for yielding, and I join her in calling on our colleagues to join us in this effort to preserve and protect the 340B program.
I will share a success story that highlights how Members worked in a bipartisan way to solve a major issue within the 340B program.
Because of the COVID-19 pandemic, some hospitals lost their 340B eligibility due to the influx of COVID-19 patients that overwhelmed some hospitals and diminished their ability to meet the requirements of the 340B program. Two of those hospitals were in my district in rural Tennessee. However, the gentlewoman from California, Representative Matsui, introduced H.R. 3203, which was designed to restore eligibility to hospitals that lost their 340B status due to the pandemic. I was proud to lend my name as a cosponsor to this bipartisan bill.
I am happy to report that because of this bipartisan support and the leadership of Members like Representative Matsui, this issue was fixed in section 121 of the Consolidated Appropriations Act of 2022. Because of this bipartisan effort, I am pleased to report back that both hospitals in my district in Tennessee have since regained that 340B eligibility.
Madam Speaker, I hope this story shows that Members are capable of protecting and strengthening the 340B program in a bipartisan way.
Madam Speaker, again, I thank the gentlewoman from Virginia (Ms. Spanberger). She has done a commendable job putting tonight's Special Order together, gathering support from both sides of the aisle to come speak here tonight about the 340B program, and being one of the Members leading the fight to protect the lifesaving 340B program.
Madam Speaker, by their presence on the House floor tonight and the persuasive and powerful words they have spoken, these Members have sent the unmistakable signal that we are all resolutely prepared to fight on behalf of our constituents who benefit from the 340B program, even if it ruffles some powerful feathers.
If Big Pharma would just play by the rules and abide by the law, I am sure we wouldn't be in the position we are today. However, the big pharmaceutical companies aren't playing by the rules, and they are showing no signs that they have an interest in doing so.
All we are asking is that they, too, are held accountable to the law. That is it. Nothing more, nothing less. In the meantime, we will continue to push back on their brazen attempts to undermine the law because I know we are on the right side of this fight.
I encourage all Members to reach out to the Federally qualified health centers, the Ryan White Clinics, Medicare/Medicaid Disproportionate Share hospitals, rural hospitals, and children's hospitals in your districts that are 340B participants. You will find that the 340B program has an enormous impact on communities all across this country.
Lastly, I reiterate my support for H.R. 4390, the Protect 340B Act, and I sincerely beseech House leadership to bring the bill to the floor for a vote.