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Pharmaceutical Research and Manufacturers of America (PhRMA) Filed Suit Today Seeking to Invalidate the 340B Orphan Drug Exclusion Interpretative Rule

Today, Pharmaceutical Research and Manufacturers of America (“PhRMA”) filed a suit seeking to invalidate the 340B Orphan Drug Exclusion Interpretative Rule.  The same Health Resources and Services Administration (“HRSA”) policy in the "interpretive rule" was previously set forth in substance as a final regulation that was struck down by the U.S. District Court for the District of Columbia, about which we previously reported here.  The court ruled that HRSA had “acted beyond the bounds of its statutory authority” because Congress did “not confer any rulemaking authority” upon HRSA to regulate the scope of the orphan drug exclusion.  After HRSA’s decision to resurrect this policy two months later as an interpretive rather than formal rule, the district court instructed PhRMA in August that if it wanted to challenge the policy, it would have to do so by bringing a new lawsuit.

PhRMA’s newest filing for declaratory and injunctive relief argues that that federal law expressly exempts manufacturers from having to provide the discounts on orphan drugs to newly eligible safety-net providers as HRSA would require.  PhRMA then argues that the interpretive rule alters the scope of the statutory orphan drug exclusion by “grafting a use-based limit onto the language that Congress enacted.”  PhRMA notes that HRSA has asserted it will enforce this new interpretive rule, and PhRMA requests that the court stop HRSA from doing so.

© 2020 Covington & Burling LLPNational Law Review, Volume IV, Number 284

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About this Author

Jennifer Plitsch, Litigation attorney, Covington
Partner

Jennifer Plitsch is co-chair of the firm’s Government Contracts practice group where her practice includes a wide range of contracting issues for large and small businesses in both defense and civilian contracting. Her practice involves advising clients on contract proposal, performance, and compliance questions as well as litigation, transactional and legislative issues. She has particular expertise in advising clients on intellectual property and data rights issues under the Federal Acquisition Regulations and Bayh-Dole Act, and has significant experience in...

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