A U.S. government agency has threatened Johnson & Johnson with sanctions if the company proceeds with plans to alter payment methods for some hospitals that participate in a federal drug discount program.
In a letter sent on Tuesday, the U.S. Health Resources and Services Administration maintained that a J&J plan to issue rebates for two widely prescribed medicines instead of offering discounted prices would violate federal law. The agency argued the planned move is unlawful because it would require the hospitals to purchase the medicines at prices exceeding what the discount program permits.
Last month, J&J announced it would change payment terms for its Xarelto blood thinner and the Stelara plaque psoriasis treatment through the 340B drug discount program, which was created to help hospitals and clinics care for low-income and rural patients. To ensure the program achieves this goal, drug companies that want to take part in Medicare or Medicaid must offer their medicines at a discount — typically, 25% to 50%, but sometimes higher — to participating hospitals and clinics.
This article is exclusive to STAT+ subscribers
Unlock this article — plus in-depth analysis, newsletters, premium events, and news alerts.
Already have an account? Log in
