[Federal Register Volume 79, Number 141 (Wednesday, July 23, 2014)]
[Notices]
[Pages 42801-42802]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-17409]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Resources and Services Administration


Availability of Interpretive Rule: Implementation of the 
Exclusion of Orphan Drugs for Certain Covered Entities Under the 340B 
Program

AGENCY: Health Resources and Services Administration (HRSA), HHS.

ACTION: Notice.

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SUMMARY: HHS is announcing the availability of an interpretive rule 
providing HHS's interpretation of section 340B(e) of the Public Health 
Service Act (PHSA), entitled ``Implementation of the Exclusion of 
Orphan Drugs for Certain Covered Entities Under the 340B Program.'' The 
interpretive rule states that section 340B(e) of the PHSA excludes 
drugs with an orphan designation only when those drugs are transferred, 
prescribed, sold, or otherwise used for the rare condition or disease 
for which the drug was designated under section 526 of the Federal 
Food, Drug, and Cosmetic Act (FD&C Act).

DATES: Effective July 23, 2014.

ADDRESSES: Submit written requests for single copies of the 
interpretive rule to the Office of Pharmacy Affairs, Healthcare Systems 
Bureau, HRSA, 5600 Fishers Lane, Room 8W03A, Rockville, MD 20857. Send 
one self-addressed adhesive label to assist that office in processing 
your requests. See the SUPPLEMENTARY INFORMATION section for electronic 
access to the interpretive rule.

FOR FURTHER INFORMATION CONTACT: CDR Krista Pedley, Director, Office of 
Pharmacy Affairs, Healthcare Systems Bureau, HRSA, 5600 Fishers Lane, 
Room 8W03A, Rockville, MD 20857, or by telephone at (301) 594-4353.

SUPPLEMENTARY INFORMATION: 

I. Background

    HHS is announcing the availability of an interpretive rule entitled 
``Implementation of the Exclusion of Orphan Drugs for Certain Covered 
Entities Under the 340B Program.'' This interpretive rule explains how 
HHS interprets section 340B(e) of the PHSA. 42 U.S.C. 256b(e). This 
interpretive rule intends to: (1) Provide clarity in the marketplace; 
(2) maintain the 340B Program savings for newly-eligible entities; and 
(3) protect the financial incentives for manufacturing orphan drugs 
designated for a rare disease or condition, as indicated in the Patient 
Protection and Affordable Care Act (``Affordable Care Act'') (Pub. L. 
111-148) and intended by Congress.
    Earlier this year, after notice and comment rulemaking, HHS issued 
a final rule on this subject, ``Exclusion of Orphan Drugs for Certain 
Covered Entities Under 340B Program'' (78 FR 44016, July 23, 2013) (the 
``Rule''). The Rule was vacated by U.S. District Court for the District 
of Columbia on May 23, 2014, on the grounds that HHS does not have the 
authority to issue the Rule as a substantive rule. PhRMA v. HHS, No. 
13-01501 (D.D.C. May 23, 2014). However, the decision did not 
invalidate HHS's interpretation of the orphan drug exclusion in the 
Rule.

[[Page 42802]]

    Because there still is a need for HHS to clarify its interpretation 
of how the orphan drug exclusion in the 340B Program should be 
implemented to be consistent with section 340B(e) of the PHSA, HHS is 
making available an interpretive rule on this topic. In short, this 
interpretive rule clarifies that HHS interprets section 340B(e) of the 
PHSA as excluding drugs with an orphan designation only when those 
drugs are transferred, prescribed, sold, or otherwise used for the rare 
condition or disease for which the drug was designated under section 
526 of the FD&C Act. This section of the PHSA does not exclude drugs 
that are transferred, prescribed, sold, or otherwise used for 
conditions or diseases other than for which the drug was designated 
under section 526 of the FD&C Act.

II. Electronic Access

    Persons with access to the Internet may obtain the document at 
www.hrsa.gov/opa/programrequirements/interpretiverule/.

    Dated: July 16, 2014.
Mary K. Wakefield,
Administrator, Health Resources and Services Administration.
    Dated: July 18, 2014.
Sylvia M. Burwell,
Secretary.
[FR Doc. 2014-17409 Filed 7-21-14; 11:15 am]
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