(Reuters) -French drugmaker Sanofi (NASDAQ:) plans to change its policy on how it gives discounts to certain U.S. hospitals that serve low-income and uninsured patients, the company said on Friday.
Sanofi’s new plan will require institutions to provide pharmacy and medical claims information, such as the drug’s order or a patient’s hospital visit, before receiving federally mandated discounts under a program known as 340B.
Under Sanofi’s new plan, certain hospitals covered by the 340B program would order drugs at full price from a wholesaler.
“The changes we are making are consistent with the 340B program’s mission … helping to eliminate prohibited duplicated discounts and diversion of 340B drugs away from eligible patients,” said Sanofi.
According to the Wall Street Journal, which was the first to report the matter, Sanofi plans to send a letter, that was reviewed by the publication, to hospitals outlining its new model.
Last week, drugmakers Eli Lilly (NYSE:) and Johnson&Johnson (NYSE:) filed cases centered around the 340B program against U.S. federal health agencies.
Lilly sued the Health Resources and Services Administration (HRSA) over allegedly blocking the company’s plan to change the way it offers drug discounts to hospitals. Lilly said that its program is designed to pay cash directly to 340B covered entities every week.
J&J, which sued the Health and Human Services Department, accuses the agency of blocking its plan to sell its psoriasis treatment Stelara and blood thinner Xarelto to some hospitals at full price before applying drug rebates.
The 340B program, in which drugmakers provide discounts to eligible healthcare providers that serve low-income populations, has been the focus of broad legal scrutiny over the years. Drugmakers must participate in the program to receive funds from government health insurance programs like Medicare and Medicaid.
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