Four items today. A new FDA compounding guidance that took effect on publication and reaches state-licensed pharmacies, two developments in 340B, and a federal audit of how California handles Medicaid overpayment recovery.
FDA issues temporary compounding policies for neonatal starter parenteral nutrition
FDA has published guidance describing its regulatory and enforcement priorities for compounding certain starter parenteral nutrition drug products for neonates. Two things stand out. The guidance was published for immediate implementation rather than going out for comment first, which usually points to a supply problem sitting behind it. And it is not limited to registered outsourcing facilities. It also covers state-licensed pharmacies and federal facilities that are not registered with FDA as outsourcing facilities. If your pharmacy compounds neonatal starter parenteral nutrition, the conditions set out in the guidance are what you will be measured against now. Those conditions are the substance of the document, so read them before assuming you are covered by the policy. Read more at the Federal Register →
Johnson & Johnson expands 340B data requirements and extends contract pharmacy restrictions to grantees
Johnson & Johnson has announced it will expand its 340B claims data requirements to cover drugs a covered entity dispenses in house, not only those going through contract pharmacies. It is also extending its contract pharmacy restrictions to grantees. Both halves matter. Manufacturers and covered entities have been fighting over contract pharmacy arrangements for years, and pulling grantees into the restrictions widens that fight to organizations that had largely stayed out of it. The in-house data requirement is a different kind of change, because it reaches dispensing a covered entity handles itself. Grantees in particular should expect to hear about this directly rather than read about it later. Read more at 340B Report →
A congressional report tracks what states are doing on 340B
A new congressional report on state efforts to lower prescription drug prices gives attention to the growing number of states that have acted on 340B. Most of that state activity has taken the form of contract pharmacy protection laws, passed while the federal litigation continues. The report is useful as a map of where the states stand and which way they are moving. It is a survey rather than a legal analysis, and it is worth reading as one. Read more at 340B Report →
OIG says California did not return the full federal share of Medicaid overpayments
The HHS Office of Inspector General has released an audit examining whether California reported and returned the correct federal share of Medicaid overpayments identified by its Medicaid Fraud Control Unit during federal fiscal year 2023. OIG concluded the state fell short across the 26 cases it reviewed, and put the federal share that should have been reported and returned at just over $99 million. This is a finding about the state’s reporting, not about any individual provider. It is worth noting anyway, because of what tends to follow. When a state is told it left that much federal money unrecovered, pressure to pursue recovery on the provider side generally increases, and pharmacies sit in the Fraud Control Unit’s case mix alongside everyone else. Read more at the HHS Office of Inspector General →
This update is general information about developments in pharmacy law and regulation. It is not legal advice, it does not create an attorney-client relationship, and it should not be relied on as a substitute for advice about your own situation. Prior results do not guarantee a similar outcome. If you have a specific question about your pharmacy, call or write and we will talk about it properly.
Law Office of Bhavesh Desai | Bhavesh Desai, Pharm.D., Esq.
18085 Watson Way, Yorba Linda, CA 92886 | (909) 618-7299
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