When a regulated price calculation reaches less than a penny, the choice of fallback matters. HRSA's January 5, 2017 final 340B rule sets the ceiling at one cent per unit of measure in that circumstance. It does not let the exceptionally low result turn into an unrestricted price for the covered sale. Nor does it price every drug at one cent. [2016-31935]

The June 17, 2015 proposal spelled out the alternatives the agency rejected: a prior-quarter price, wholesale acquisition cost or another non-340B contract price in place of penny pricing. Its reasoning was that substitution would nullify the formula. Read with the final exception, this identifies a constraint on manufacturer pricing discretion, not evidence that production, availability or prices outside 340B changed. [2016-31935][2015-14648]

The final calculation subtracts the unit rebate amount from the preceding quarter's average manufacturer price for the smallest unit of measure. Using that historical input is different from simply carrying forward an earlier ceiling. The rule governs covered outpatient drug sales to eligible covered entities. It cannot be read as a price ceiling for the entire U.S. pharmaceutical market or for sales abroad. [2016-31935]

A separate enforcement mechanism addresses knowing and intentional overcharging by manufacturers with pharmaceutical pricing agreements: potential civil monetary penalties in addition to repayment. The original schedule put effectiveness on March 6 and planned enforcement at April 1, 2017. Proposal and final rule show the agency's chosen incentives within one proceeding. They do not establish how manufacturers actually responded to those incentives. [2016-31935][2015-14648]

Source documents

  1. 340B Drug Pricing Program Ceiling Price and Manufacturer Civil Monetary Penalties Regulationhttps://www.govinfo.gov/content/pkg/FR-2017-01-05/html/2016-31935.htm
  2. 340B Drug Pricing Program Ceiling Price and Manufacturer Civil Monetary Penalties Regulationhttps://www.govinfo.gov/content/pkg/FR-2015-06-17/html/2015-14648.htm