Johnson & Johnson (J&J) works to expand equitable patient access every day. This includes our long-standing participation in the 340B Program which serves as an important safety net for vulnerable patients. J&J supports the original intent of the 340B Program.
J&J is acting now to support the 340B Program’s long-term sustainability, ensure program integrity through transparency, and ultimately protect patients’ access to care. Johnson & Johnson’s lawsuit against Health Resources and Services Administration (HRSA) is related to the agency’s final decision regarding J&J’s Transparency Rebate Model (“transparency model”) which would allow J&J to verify 340B claims are actually purchased and dispensed by a 340B entity.
J&J’s transparency model is legally permissible, uses commercially standard data validation practices, and will help ensure compliance with the Inflation Reduction Act’s (IRA) requirements, while ultimately protecting patients’ access to care. J&J’s proposed transparency model is a narrowly tailored and legally permissible model focusing on two products (STELARA® and XARELTO®) and for a limited set of the largest covered entities – Disproportionate Share Hospitals (DSH). This model will also ensure prompt payments, within 7-10 days of timely claims submission.
Why transparency is critical now
340B Program sales have grown by 129% since 2018 -- more than 3X the growth rate for non-340B sales, with little oversight.
The government’s own data spotlights how the rapid growth of the 340B Program can result in cases of diversion or duplicate discounts. Federal government audits have yielded more than 500 diversion-related findings among covered entity audits over an eight-year period. The Government Accountability Office (GAO) found more than 400 instances of noncompliance related to duplicate discounts among audited covered entities, which is prohibited by the 340B statute. The risk of further duplicate discount abuse is heightened with the implementation of the Inflation Reduction Act (IRA), which statutorily requires manufacturers to certify that no duplicate discounts are occurring.
While this legal action is pending, we will continue to engage with the HRSA and other stakeholders to explore solutions aimed at improving transparency and program integrity to better serve vulnerable patients tomorrow and in years to come.
(Read more about the 340B Program in J&J’s 2023 Transparency Report.)
J&J Media Statement
The following statement should be attributed to a J&J spokesperson:
Johnson & Johnson works to expand equitable access for patients every day. By advancing a narrowly focused transparency rebate model, Johnson & Johnson is helping to support the 340B Program’s long-term sustainability, ensure compliance with the Inflation Reduction Act’s requirements, and ultimately protect patients’ access to care. Johnson & Johnson is taking action to bring much needed transparency essential to helping the 340B program achieve its original intent to support prescription drug access for vulnerable patients. Johnson & Johnson remains strongly committed to the original intent of the 340B Program.
For any media queries, please contact us at media-relations@its.jnj.com.