Amicus Brief: Academic Medical Centers Support AHA in 340B Case September 10, 2021

At A Glance

Amici curiae are six of the nation’s premier academic medical centers: Yale New Haven Health System (YNHHS), BJC HealthCare (BJC), Cedars-Sinai Medical Center (CSMC), Geisinger, UPMC (University of Pittsburg Medical Center), and Vanderbilt University Medical Center (VUMC).

Introduction:

In 1990, Congress enacted the Medicaid Rebate Program, as part of the Omnibus Reconciliation Act of 1990 (Pub. L. No. 101-508).20. This law requires drug companies that choose to participate in Medicaid to give states, which administer Medicaid, discounts comparable to those given to other payers. Specifically, the Medicaid Rebate Program requires manufacturers to offer states a rebate on their purchases of certain prescription drugs, and the size of the rebate is calculated based on the “best price” the drug manufacturer has given to most purchasers for a particular drug or between 13% and 23.1% of average manufacturing price, whichever is greater.

In response to the Medicaid Rebate Program, in order to avoid giving state Medicaid programs what had been their best price prior to 1990, drug manufacturers discontinued many of the discounts that they had been offering non-state purchasers.22 As a result, the “[p]rices paid for outpatient drugs by Federally-funded clinics and public hospitals” surged.

View the entire Amicus Brief below.