Third Circuit Issues Unfavorable Decision Allowing Drug Manufacturers to Continue Restrictive Contract Pharmacy Policies

The first of three federal circuits to consider the authority of the Health Resources and Services Administration (HRSA) to prohibit drug manufacturer contract pharmacy restrictions issued an unfavorable decision for hospitals, ruling that the federal 340B statute is silent with respect to contract pharmacies and that HRSA lacks authority to enforce its interpretation against the three plaintiff drug manufacturers. New and stricter manufacturer restrictions have continued since the Third Circuit’s ruling. Similar lawsuits are awaiting decisions in the 7^th and D.C. Circuits.