On May 13, 2026, Pharmacy Purchasing & Products hosted a timely webinar, sponsored by Bluesight, which covered key facets of the rapidly shifting 340B program.
Mark Ogansusi and Daryl White from the K&L Gates Healthcare and FDA practice group presented crucial legal and pharmacy-specific insights to help facilities navigate this increasingly complex regulatory environment. If you missed the live event, here is a comprehensive breakdown of the major trends, challenges, and strategies discussed by the experts.
The Root of the Conflict: Statutory Silence & Data as “Currency”
To understand the current landscape, it is helpful to look at the original 340B statute passed in 1992, which was designed as a purchasing and pricing program to fortify public health infrastructure, rather than a direct patient benefit program. While the law dictates drug discounts, diversion prevention, and auditing, the statute is notably silent on how drugs should be delivered, makes no mention of the term “pharmacy,” and does not outline required data submissions outside of formal audits.
Because the law is silent on these operational details, manufacturers have effectively transformed claims data into currency. Safety-net providers are now required to submit highly detailed, claim-level commercial data to manufacturers just to access the 340B discounts they are legally owed.
The Contract Pharmacy Legal Battle
Manufacturer mandates to submit data have led to significant friction regarding contract pharmacy access. In response, approximately 22 states (both red and blue) have enacted laws utilizing principles of federalism to protect drug distribution and data practices for contract pharmacies.
However, these state laws are actively being challenged in federal court, resulting in a “circuit split”. The Eighth and Fifth Circuits have upheld these state protections as constitutional, while the Fourth Circuit has ruled them unconstitutional. Until the Supreme Court or Congress resolves this divide, the presenters warn that providers must be prepared to track and submit the necessary data depending on their jurisdiction.
Intensifying Audits and the Battle Over “Patient” Definition
Both HRSA (the agency administering 340B) and individual drug manufacturers are dramatically ramping up their audit efforts, with a massive focus on defining what constitutes an eligible “patient”.
- HRSA Audits: HRSA now demands granular proof connecting individual prescription claims, shipping addresses, and the covered entity’s underlying grant scope.
- Manufacturer Audits: Manufacturers are launching “good faith inquiries” using their own highly restrictive interpretations of a patient.
In a precedent-setting move, drugmaker AbbVie has sued the federal government over the patient definition, pushing for a standard that requires substantive, condition-specific care within a 12-month window. This means audit risk is no longer driven by isolated clerical errors, but by systemic gaps in a facility’s ability to prove a patient’s eligibility on a granular, claim-by-claim basis at a moment’s notice.
The Impact of the Inflation Reduction Act (IRA)
The introduction of the Maximum Fair Price (MFP) under the IRA adds another massive layer of complexity. As Medicare negotiates lower prices for costly drugs, pharmacies are reimbursed in the first instance at the MFP, forcing manufacturers to issue refunds to the pharmacy to make them whole.
To figure out whether the 340B price or the MFP is the required lower price, drug makers are mandating pre-audit data submissions from providers. This dynamic is the catalyst driving the federal government toward a new 340B rebate pilot program. Under a rebate model, providers would have to purchase drugs upfront at the higher Wholesale Acquisition Cost (WAC) and submit data to receive a refund later. This shift will put downward pressure on reimbursement and drastically increase administrative and floating costs for safety-net providers.
The Solution: 100% Claim-Level Data Validation
With increased manufacturer scrutiny, Medicare managed care plans targeting 340B claims, and MFP pricing overlapping, traditional audit sampling of 20 to 30 claims is no longer sufficient. The best defense for covered entities is implementing continuous, 100% auditable claim-level data validation.
The presenters recommend utilizing neutral vendors that can consolidate varying manufacturer data requirements across platforms like ESP, Beacon, and others. A robust validation system integrates with the electronic medical record (EMR) to ensure that the appropriate rebates are calculated, protect against prescriber mismatches, and provide an auditable trail for HRSA and drug makers.
Future Predictions
Looking ahead, the presenters predict that substantive 340B reform will likely stem from the “Sustain Act” – a bipartisan bill currently in development. Anticipated federal changes could focus on reducing hospital eligibility, establishing a mandatory neutral federal clearinghouse, enacting contract pharmacy rules, and legally limiting the patient definition.
In the meantime, providers are strongly encouraged to consult with data vendors and financial experts to model the lost revenue and the opportunity cost of floating WAC drug purchases.
Click here to learn more about how Bluesight’s 340BCheck solution can keep your organization 100% compliant.
And to view the full webinar, listen to the Q&A session, and download the presentation slides, visit pppmag.com/webinars.