As urged by the AHA and others, J&J tells HRSA it is abandoning proposed 340B rebate plan

Johnson & Johnson Sept. 30 notified the Health Resources and Services Administration that it is ceasing implementation of its proposed 340B rebate model. The decision comes after HRSA Sept. 27 said it would terminate J&J's Pharmaceutical Pricing Agreement and/or impose civil monetary penalties if J&J didn't halt implementation of the program. In addition, Reps. Abigail Spanberger (D-Va.), Dusty Johnson (R-S.D.), Doris Matsui (D-Calif.), Debbie Dingell (D-Mich.), Tracey Mann (R-Kan.) and Rob Wittman (R-Va.) Sept. 27 sent a letter signed by a bipartisan group of 189 members of the House of Representatives urging the Department of Health and Human Services to take action against J&J if it did not abandon its proposal.

"The AHA is pleased that Johnson & Johnson has decided to cease implementation of its 340B rebate proposal, which would have harmed patients and 340B providers," said Rick Pollack, AHA president and CEO. "We are especially appreciative of HRSA's efforts to convince J&J to put an end to this unlawful proposal and those members of Congress who demonstrated their firm support of the 340B program."

On Aug. 23, J&J announced that it would be upending its approach to 340B pricing for two of its most popular products, Stelara and Xarelto. Historically, J&J offered upfront discounts to 340B hospitals when they purchased these drugs. However, J&J said starting Oct. 15 it will require all disproportionate share hospitals participating in the 340B program to purchase these drugs at full price and apply for a rebate from J&J. Immediately after J&J's announcement, AHA expressed concern and said HRSA should take "immediate enforcement action," including assessing civil monetary penalties on J&J for intentionally overcharging 340B hospitals.