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 Sagebrush’s patient services, clinical operations, and community outreach activities.
The 340B Drug Pricing Program is a federal program that requires drug manufacturers to offer outpatient drugs at discounted prices to eligible “covered entities.” Sagebrush is a covered entity certified by HRSA. HRSA is the sole federal agency responsible for determining and overseeing covered entity eligibility and compliance.
In the complaint, Sagebrush alleges that:
• Amgen stopped selling its drugs at 340B discounted prices to Sagebrush despite Sagebrush’s certification as a covered entity.
• Amgen reversed previously extended discounts on 340B drugs, clawing back not less than $7 million in previously-earned 340B savings and charging Sagebrush the full wholesale acquisition cost for the drugs.
• The reversal caused wholesalers who serve as the middle-man between drug manufacturers such as Amgen and providers such as Sagebrush, to rebill Sagebrush at the full price for the drugs, triggering freezes on drug orders, and reductions in Sagebrush credit lines across multiple suppliers.
• These actions immediately created operational strain and reduced Sagebrush’s capacity to provide timely care for its patient population.
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 questions regarding a covered entity’s compliance with 340B Program requirements, including claims of overcharging or diversion, must be addressed through the federal Administrative Dispute Resolution (ADR) process established by Congress and overseen by HRSA, while eligibility determinations remain with HRSA. Sagebrush’s lawsuit demands repayment of the monies owed by Amgen to Sagebrush.
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.
