On September 27, 2013, the Pharmaceutical Research and Manufacturers of America (PhRMA), a major drug industry trade organization filed suit in the U.S. District Court for the District of Columbia to enjoin the Health Resources and Services Administration (HRSA) from implementing its July 23, 2013 final rule on “exclusion of Orphan Drugs for Certain Covered Entities under 340B Program”. The final rule became effective October 1, 2013.  (See our July 22, 2013, post for more detail about the final rule.)  In the lawsuit, PhRMA requests that the final rule be declared in violation of the Administrative Procedure Act and permanently enjoined.

Among other things, PhRMA’s complaint alleges: “HHS’s revision of the orphan drug exclusion through rulemaking is at odds with the plain statutory text. The statutory language makes clear that Congress intended the orphan drug exclusion to apply to any orphan drug sold to one of the newly covered entities, regardless of whether the covered entity uses the drug for an orphan indication. The Final Rule thus violates the Administrative Procedure Act because it is not in accordance with law…Moreover, HHS lacked authority to issue the Final Rule.”

On October 2, 2013, the Safety Net Hospitals for Pharmaceutical Access (SNHPA), a trade organization representing covered entities that purchase under the 340B Drug Discount Program, issued a statement responding to the lawsuit and disagreeing with PhRMA’s allegations.

Posted by Kathleen Peterson

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