AHF Praises Lawsuit to Protect 340B Discounts

WASHINGTON--(BUSINESS WIRE)--Two hospital associations and four health systems have filed a lawsuit seeking to stop Health Resources and Services Administration (HRSA)'s revised 340B rebate pilot program before it launches on January 1, 2027. The plaintiffs include the American Hospital Association (AHA), the Maine Hospital Association, and four hospitals from Maine, North Dakota, Arkansas, and New York.

Changing from the current up-front discount model in the 340B Drug Discount Program to a back-end rebate model will impose significant costs upon safety-net covered entities like AHF.

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The suit was filed on October 9, 2026, in federal court in Maine, along with a request for a temporary restraining order. The same court had previously blocked HRSA's original rebate pilot in late 2025, leading HRSA to withdraw that version and develop a revised program. HRSA approved 10 manufacturer rebate pilot plans on October 1, 2026.rebate lawsuit.

According to AIDS Healthcare Foundation (AHF) General Counsel and Chief of Public Affairs Tom Myers, “AHF opposes the use of a rebate model, which at base is simply another effort by drug companies to shirk their responsibilities under the 340B program, and further attack and reduce the program, solely for their profit. The proposed shift of responsibility from manufacturers to safety-net providers directly serving patients through a rebate model threatens to destabilize pharmacy operations nationwide. Like the unlawful imposition of contract pharmacy restrictions, pharma rebate models are yet another effort to place administrative and financial burdens on covered entities, discouraging and limiting their ability to access 340B discounts to provide more comprehensive services to their clients. Changing from the current up-front discount model to a back-end rebate model will impose significant costs upon safety net covered entities.”

The plaintiffs argue that HRSA violated administrative law by failing to adequately account for the costs the rebate model would impose on 340B covered entities. According to the complaint, HRSA dismissed concerns raised by hospitals while accepting drug manufacturers' assertions without sufficient scrutiny. The lawsuit contends that this unequal treatment of stakeholder input is legally improper.

AIDS Healthcare Foundation (AHF), the world’s largest HIV/AIDS healthcare organization, provides cutting-edge medicine and advocacy to more than 3.3 million individuals across 50 countries, including the U.S. and in Africa, Latin America/Caribbean, the Asia/Pacific Region, and Eastern Europe. In January 2025, AHF received the MLK, Jr. Social Justice Award, The King Center’s highest recognition for an organization leading work in the social justice arena. To learn more about AHF, visit us online at AIDShealth.org, find us on Facebook, and follow us on Instagram, Twitter, and TikTok.