Genentech’s 340B Discounts Making Their Mark On Product Pricing
Genentech’s 340B drugs discounts totaled $1 billion in 2012 and are growing at 20% to 25% a year, a level that has prompted management to sit up and take notice, including setting up a team to work with 340B health care providers on compliance.
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The 340B hospital discount program has a much higher profile in the Rx policy world than it did before the Affordable Care Act was signed into law; now, Roche is starting to highlight the impact of the program to a different audience: its investors.
Genentech is the first drug maker to audit an entity receiving discounts for its products under the federal 340B program. The firm began its audit of a single organization in July, but other manufacturers have since submitted audit workplans to HRSA.
In its first year of auditing 340B facilities for compliance with drug discount rules, the HHS agency is investigating 45 randomly selected entities and six “targeted” entities that are the subject of specific allegations of non-compliance. About 250 hospitals have been decertified from 340B and may have to pay back discounts to drug makers.