Sagebrush Health Services has filed a civil action against Amgen Inc., a pharmaceutical manufacturer, over a dispute under the federal 340B Drug Pricing Program.
Read the statement from Sagebrush’s CEO.
The complaint alleges that Amgen took unilateral actions resulting in the withdrawal of 340B pricing and the reversal of previously processed chargebacks, creating significant financial and operational consequences for Sagebrush. The lawsuit does not ask the court to determine Sagebrush’s 340B eligibility. That determination rests exclusively with the Health Resources and Services Administration (HRSA), the federal agency that administers the program.
This webpage outlines the key facts alleged in the complaint based on the provisions of as situated within the context of the 340B Program, and Sagebrush’s public statements on the matter.
Sagebrush Health Services is a nonprofit health care provider serving underserved populations, with a focus on promoting sexual health, providing infectious disease care, and ensuring access to essential medications. Savings generated through the 340B Program are reinvested into its patient services, clinical operations, and community outreach activities.
The 340B Drug Pricing Program, established under Section 340B of the Public Health Service Act, is a federal program that requires drug manufacturers to sell outpatient drugs at discounted prices to eligible “covered entities.” Sagebrush is a covered entity certified by the Health Resources and Services Administration (HRSA), the federal agency responsible for managing the 340B Program.
In its complaint, Sagebrush alleges that:
• Amgen stopped selling its drugs at 340B discounted prices to Sagebrush despite its certification as a covered entity. Amgen also reversed previously extended discounts, clawing back over$7 million in savings and charging Sagebrush the full price of the drugs.
• This reversal caused wholesalers, who serve as intermediaries, to rebill Sagebrush at full price, triggering freezes on drug orders and credit line reductions.
• These actions allegedly created immediate operational strain and reduced Sagebrush’s capacity to provide timely care.
The issues raised in the complaint have implications for how federal program rules are interpreted and applied, particularly for smaller nonprofit providers that rely on 340B savings to sustain care for vulnerable populations. The lawsuit seeks to resolve whether a manufacturer may act outside the federal oversight process while a covered entity remains certified by HRSA.
Sagebrush’s position is that, no, manufacturers cannot act unilaterally under the 340B Program, and instead must turn to HRSA with any questions or concerns regarding covered entities or any other issues under the 340B Program. Manufacturers are prohibited by law from reclaiming money from covered entities. HRSA is to be involved from the beginning and Amgen should have initiated the statutorily-prescribed Administrative Dispute Resolution (ADR) process for any issues it had with Sagebrush.
This case is not about whether Sagebrush qualifies as a 340B covered entity. HRSA has stated that Sagebrush is a covered entity. This case is about Amgen deciding on its own that Sagebrush does not qualify and simply taking back money that it owed to Sagebrush without consulting HRSA or obtaining approval of any kind and then refused to sell any discounted drugs to Sagebrush going forward, which violated the law.
The complaint alleges that Amgen:
These actions, as alleged, resulted in operational disruptions and reduced patient treatment capacity.
The complaint states that Sagebrush incurred:
The complaint requests:
The case raises questions about:
Have questions about the case? Need additional information? Send us a message and we’ll get back to you.
