Letter to Xavier Becerra, Secretary U.S. Department of Health and Human Services - Spanberger to HHS: Hold Drug Companies Accountable for Breaking the Law, Crack Down on Illegal Price Hikes

Letter

Dear Secretary Becerra,

We write today as longstanding supporters of the 340B program to urge the Department of
Health and Human Services (HHS) to expedite enforcement action against pharmaceutical
companies that continue to illegally overcharge 340B covered entities. Unfortunately, the slow
pace of HHS's enforcement efforts to date has emboldened additional companies to begin
unlawfully overcharging covered entities and threatens the integrity of the 340B program.

Despite overwhelming opposition from Congress, the previous Administration, this
Administration, and thousands of 340B-covered entities and safety net providers around the
country, more and more drug companies have begun to willfully deny 340B pricing to safety net
providers who serve the most vulnerable patient populations in our communities. HHS has the
authority to take enforcement action that could deter these manufacturers -- and any other
manufacturer considering such action -- from engaging in this unlawful activity.

In February, in response to six of the leading drug companies in the U.S. announcing they would
no longer honor 340B discounts, this coalition led a letter -- signed by over 220 of our colleagues
in the U.S. House of Representatives -- urging HHS to put an immediate stop to these actions.
Several months later, we were pleased to see the Health Resources and Services Administration
send letters to the six companies informing them that their refusal to honor 340B pricing violates
their statutory obligations and ordering them to resume offering 340B pricing and repay past
overcharges. The letters further explained that civil monetary penalties could be imposed if the
companies continued to violate the statute.

Despite the manufacturers' defiant refusal to comply or even plan to comply, only in September
did HHS refer the companies to the Office of Inspector General for possible enforcement action.
Unfortunately, this ongoing inaction has emboldened at least six more drug companies to join the
original six companies in flouting the law.

Healthcare providers who rely on the 340B program and the patients they serve are suffering and
cannot wait much longer for HHS to protect the program's integrity. Many 340B-covered entities
are struggling with severe financial losses and staffing challenges as a result of the COVID-19
pandemic, and they cannot afford to pay higher up-front prices for the drugs their patients need.
Drug companies' refusal to offer 340B pricing for drugs dispensed through community
pharmacies impedes the ability of covered entities to finance critical health care for their
patients.

Again, we urge you to move quickly to enforce the law and begin assessing civil monetary
penalties on manufacturers that have denied 340B pricing to providers.

Sincerely,