Is it a 340B Drug?

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Is it a 340B Drug?

Covered entities are often faced with trying to decide whether or not a particular product is a 340B drug for which PHS/340B pricing benefits and regulations apply. Sometimes this can be confusing and tedious. 340B Drug Pricing Program under section 340B of the Public Health Services Act (PHS) only applies to covered outpatient drugs (CODs), as defined under section 1927(k) of the Social Security Act (SSA). Also, the product’s manufacturer must have entered into a pharmaceutical pricing agreement (PPA) with Health and Human Services (HHS) (i.e., with the Secretary of HHS) for the labeler code that applies to the product’s NDC. The labeler code is represented by the first 5 digits of the product’s NDC.

While reaching out to the manufacturer is generally the recommended process for determining whether a product is a 340B drug, there are some initial steps that can be taken to either eliminate having to do this, or at least to facilitate and expedite the process:

  • Step 1: Confirm the product is a COD under section 1927(k) of the Social Security Act (SSA). HRSA has general summarized the following outpatient drugs as being included as CODs under the 340B Program:
    • FDA-approved prescription drugs;
    • Over-the-counter (OTC) drugs written on a prescription;
    • Biological products that can be dispensed only by a prescription (other than vaccines); or
    • FDA-approved insulins

The following FDA website and the product’s package insert can be used to help determine whether the product is included:

  • Step 2: Determine if the manufacturer has entered into a PPA for the product by using the first 5-digit NDCs (the label code). This can be accomplished by using the manufacturer search function at the HRSA/OPA 340B database to confirm whether or not the labeler code has a status of “Active”. To accomplish this, the label code itself or manufacturer’s name can be used. The HRSA/OPA 340B database can be found at:

If the product is a not a COD and/or is not subject to a PPA, then most likely it is not a 340B drug. If the product is a COD and subject to a PPA, then it most likely is a 340B drug.

  • Step 3: Review your wholesaler 340B price file (or other direct source price file) or the Apexus quarterly price file (available on the Apexus secure website for Prime Vendor Program participants) to confirm a 340B price is, or is not available based on Steps 1 and 2. If a 340B price is not shown on the price list or is not available when you try and purchase it – even though the product’s NDC includes a labeler code subject to a PPA and is a COD – the wholesaler and/or manufacturer can be contacted to determine the underlying issue as to why a 340B price is not available. For example, the product may be in short supply, in back-order, or may only available through a limited distribution network established by the manufacturer.

If the issue cannot be resolved, HRSA encourages covered entities to bring it to their attention and maintains a 340B price unavailability website link that provides guidance on reporting this to them:

Words of Caution: Some covered entities have interpreted certain drugs as non-CODs under section 1927(k). Any such drug should not be treated by the covered entity as a 340B drug that can be purchased at a 340B price. Neither HRSA nor Apexus will endorse a particular non-COD interpretation. Any such interpretation should be defensible, consistently applied in all areas of the entity, documented in policy/procedures, and auditable. Also, for rural referral centers (RRCs), sole community hospitals (SCHs), critical access hospitals (CAHs), and free-standing cancer hospitals (CANs), under section 340B(e) of the PHS the term ‘covered outpatient drug’ (COD) shall not include “a drug designated by the Secretary under section 526 of the Federal Food, Drug, and Cosmetic Act for a rare disease or condition (orphan drugs). These types of covered entities should not treat orphan drugs as 340B drugs, though a manufacturer at its sole discretion may choose to offer a discounted price to these covered entities.


About Author

Rich Bucher, JD, RPh, 340B ACE

Pharmacist with experience in pharmacy leadership, compliance, and contracting for a large healthcare organization and for a large regional health plan. This includes practical experience dealing with operational, compliance, and legal issues associated with managing a system-wide 340B Program. Also, over 10 years of legal practice experience, including in health care law and contracting. Rich has presented on 340B and other health care compliance topics at numerous conferences. Rich has conducted many external 340B audits and provided consultation for various covered entity types, including providing onsite support during HRSA audits. Rich is a lead auditor on our 340B independent auditing team, oversees legal and compliance issues, and provides client contract and policy/procedure reviews.

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