Court strikes HRSA 340B policy restricting initial hospital drug purchases through GPOs

The U.S. District Court for the District of Columbia March 31 vacated a Health Resources and Services Administration policy instituted in 2013 that restricted how certain 340B hospitals could make initial drug purchases. The case challenged a provision in the rule involving group purchasing organizations, known as the “GPO prohibition,” which bars disproportionate share hospitals from simultaneously buying outpatient drugs through the 340B Drug Pricing Program and a GPO. Although the court set aside the existing GPO prohibition as unlawful, it sent the question back to the agency for reconsideration. “In that process,” the court explained, "HRSA may adopt the same bottom-line view of the statute it did in the 2013 Policy, as long as the agency adheres to the APA [Administrative Procedures Act] and does not exceed its limited rulemaking authority over the Section 340B Program.”