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Attorney General William Tong

12/14/2020

Attorney General Tong Leads Bipartisan Coalition Protecting Access to Affordable Prescriptions for Low-Income Patients

(Hartford, CT) – Attorney General William Tong today led a bipartisan coalition of attorneys general urging the U.S. Department of Health and Human Services (HHS) to hold accountable drug manufacturers that are unlawfully imperiling access to affordable prescriptions for low-income patients.

“Drug manufacturers are unlawfully attempting to disrupt arrangements that have long made it easier for low-income Americans to access prescription drugs. HHS must immediately step in to protect vulnerable patients from the unlawful and unacceptable actions of these drug manufacturers. The 340b Drug Pricing Program has strong bipartisan support from lawmakers and leaders nationwide, and HHS should not allow drug makers to unilaterally ignore their obligations,” said Attorney General Tong.

The 340B Drug Pricing Program requires drug manufacturers to provide discounted drugs to eligible health centers and hospitals, including community health centers, nonprofit and public hospitals, and Ryan White HIV/AIDS clinics, helping providers keep costs low even as prescription drug prices rises. In today’s letter addressed to Health & Human Services Secretary Alex Azar, the attorneys general argue that by withholding or threatening to withhold these critical discounts, drug manufacturers Eli Lilly & Company, AstraZeneca PLC, Sanofi SA, Novartis Pharmaceuticals, Merck & Co., United Therapeutics Corp., and others, put low-income patients at risk of losing access to affordable medications while communities continue to battle the COVID-19 pandemic. The 340B Drug Pricing Program has strong bipartisan support, and Congress has acted numerous times to ensure drug manufacturers continue to comply with the program’s mandates.

As a condition of having their drugs covered by Medicaid and Medicare Part B, Congress required drug manufacturers to enter into Pharmaceutical Pricing Agreements (PPA) with the HHS Secretary to limit the amount public hospitals, community health centers, and others serving indigent patients have to pay drug manufacturers for medications. These PPAs require the companies to offer each covered medication to providers “at or below the applicable ceiling price”. Instead of complying with their obligations, Eli Lilly & Company, AstraZeneca PLC, Sanofi SA, Novartis Pharmaceuticals, Merck & Co., United Therapeutics Corp., and others have unlawfully refused, threatened to stop providing discounts, or have put unreasonable conditions upon the discounts, potentially depriving Americans who rely on them with essential healthcare resources that they need as the country deals with a public health crisis. Under the 340B Drug Pricing Program, HHS has the authority to address violations of the program by drug manufacturers. For example, HHS may require manufacturers to reimburse covered healthcare centers and/or terminate manufacturers’ PPAs.

While HHS has recently published regulations establishing an administrative dispute resolution (ADR) process under which covered entities can file complaints and seek relief, the ADR process is not sufficient to address immediate harm caused by drug companies.

The letter urges HHS to use the authority Congress provided it to hold drug manufacturers accountable to their legal obligations under the 340B Program noting that the current pandemic sharpens the need to stand by vulnerable patient populations and the healthcare institutions that serve them.

In October, Attorney General Tong sent letters to Eli Lilly, Astra Zeneca, Merck, Sanofi, and Novartis demanding the drug makers immediately abandon their unlawful actions imperiling access to affordable prescriptions for low-income patients.

Attorney General Tong and California Attorney General Xavier Becerra led today’s coalition, joined by the attorneys general of Kansas, Nebraska, Colorado, Delaware, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, Vermont, Virginia, Washington, Wisconsin, and the District of Columbia.

A copy of the letter to HHS is available here.

Assistant attorneys general Lynn Wittenbrink and Joseph Chambers, Head of the Finance Department, assisted the Attorney General in this matter.
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