News

Government declines to appeal ruling in PBM accumulator programs MDRP final rule litigation

19 July 2022

On Tuesday, May 17, 2022, the U.S. District Court for the District of Columbia issued a decision granting the Pharmaceutical Research and Manufacturers of America’s (PhRMA)’s motion for summary judgment and vacating (i.e., invalidating) the Centers for Medicare & Medicaid Services’ (CMS’s) pharmacy benefit manager (PBM) accumulator adjustment programs Medicaid Drug Rebate Program (MDRP) final rule (Final Rule).

The Final Rule would have required a manufacturer to count the value of patient cost-sharing assistance in best price and average manufacturer price unless the manufacturer “ensure[d]” that the full value passed to the patient, as opposed to the plan. The Final Rule was vacated on the grounds that it violated the text of the Medicaid rebate statute. We issued a client alert on the ruling available here.

The government had 60 days from the date of the ruling to appeal, and that deadline passed on July 18, 2022. Because the government has decided to not appeal the ruling, the Final Rule remains invalidated and will not go into effect.

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Please contact the Hogan Lovells Government Price Reporting Team if you have any questions or would like to discuss this development.

Authored by Alice Valder Curran, Ken Choe, Kathleen Peterson, Samantha D. Marshall, Mahmud Brifkani, and Erin Meyers.