Opposition to Government’s Motion to Dismiss and Reply in Support of Motion for a Permanent Injunction Covering the 2019 OPPS Rule

February 26, 2019

In a highly unusual filing, Defendants seek to defend the 2019 OPPS Rule with arguments that Defendants forthrightly acknowledge the Court has already rejected. See Gov’t Mem. in Supp. of Mot to Dismiss New Claim & Opp’n to Mot. for Perm. Inj. With Respect to 2019 OPPS Rule (“Gov’t Mot.”), ECF No. 42 at 2 (“Defendants recognize that the Court has rejected those arguments in the context of the 2018 OPPS Rule . . . .”). Although Defendants ask the Court to “reconsider its conclusion in the context of the 2019 OPPS Rule,” id., Defendants recite exactly the exact same arguments that they raised in defense of the 2018 OPPS Rule and give no reason whatsoever that the result should be different for the 2019 OPPS Rule. Plaintiffs respectfully ask the Court to issue a permanent injunction holding the 2019 OPPS Rule unlawful under 42 U.S.C. § 1395l(t)(14)(A)(iii), just as the Court did with respect to the 2018 OPPS Rule.

As for the remedy, Defendants simply incorporate all of the same remedy arguments they have raised with respect to the 2018 OPPS Rule, and, in doing so, they fail to recognize that the 2019 OPPS Rule can be remedied prospectively, in part, given that it is still early in the year. The need to implement a remedy at a time when it can be done prospectively is especially acute given Defendants’ intransigence regarding retrospective changes to the OPPS system. See Gov’t Remedy Brief, ECF No. 31 at 7–9. The sooner a prospective remedy is implemented, the shorter the portion of 2019 that will be subject to the parties’ disputes regarding retrospective remedies. Given Defendants’ refusal to engage on the issue of an appropriate prospective remedy, the Court should implement Plaintiffs’ proposal and order Defendants to issue an interim final rule within 30 days, effective no more than 30 days later, providing that 340B drugs will be reimbursed at the statutory default rate of ASP plus 6%—that is, the same rate that Defendants applied in 2017 and the same rate they are currently applying in 2019 for all separately payable drugs not purchased under the 340B Program (and for some 340B Drugs that were exempted from the rate reduction). As for a retrospective remedy for all 340B drugs where claims were paid in 2019 before the effective date of the interim final rule, Plaintiffs ask that the Court implement the same retrospective remedy that Plaintiffs have proposed for 2018. See Pls.’ Suppl. Br. on Remedies, ECF No. 32 at 2, 10.

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