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Legal Insights and Perspectives for the Healthcare Industry

As reported in As Prescribed, US President Donald Trump signed four executive orders implementing policies on drug pricing on July 24. One of the orders directs the secretary of the US Department of Health and Human Services (HHS) to condition future grants under Section 330(e) of the Public Health Service Act on Federally Qualified Health Centers establishing practices that ensure the 340B discount they receive on insulin and injectable epinephrine is passed through to low-income patients who lack insurance or have high copays or deductibles. The HHS secretary has discretion to set the standard for eligible patients.

In the blog post, Morgan Lewis senior counsel Donna Yesner reports that this policy is limited in scope to one category of covered entities—it does not extend to hospitals—and two categories of drugs, but is consistent with the legislative intent of the 340B program to make outpatient drugs accessible to poor and uninsured or underinsured patients of federal grantees. But, as with other drug pricing executive orders, there could be problems carrying out the 340B directive.

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