Alerts2.25.26
340B Rebate Model Pilot Program Effectively Ends Preserving Upfront Discounts, For Now
Highlights
- In American Hospital Association v. Kennedy, the U.S. Court of Appeals for the First Circuit denied the government's motion to stay the U.S. District Court for the District of Maine’s nationwide preliminary injunction against Health Resources and Services Administration (HRSA)’s 340B Rebate Model Pilot Program. Following the First Circuit’s denial, the government asked the court to dismiss the appeal.
- On Feb. 10, 2026, the District of Maine granted the parties’ joint motion to vacate the Pilot Program and to remand to HRSA for the agency to reassess and adjust the program.
- HRSA has paused the Pilot Program while the 340B ceiling price upfront remains in place for the affected drugs. Covered entities should continue to receive upfront 340B discounts for the affected drugs, without shifting to a rebate workflow.
The 340B Drug Pricing Program, administered by HRSA under Section 340B of the Public Health Service Act, requires drug manufacturers to sell outpatient drugs to eligible safety-net providers at or below a statutory ceiling price paid upfront at purchase. HRSA’s Pilot Program would have replaced the upfront discount with manufacturer rebates paid after dispensing certain drugs, in an effort to address duplicate discount concerns and to coordinate with the Inflation Reduction Act (IRA)’s Maximum Fair Price (MFP) process.
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