LAS VEGAS, Nev. — Sagebrush Health Services, a nonprofit organization serving over 10,000
Nevada patients, has filed a lawsuit against Amgen Inc. (NASDAQ: AMGN), alleging that Amgen
acted unlawfully by unilaterally terminating the sale of discounted drugs to Sagebrush’s clinics
and improperly retracting millions of dollars in past discounts. These actions, Sagebrush
maintains, temporarily prevented it from supplying its clinics with necessary medications from
Amgen and other manufacturers.
Sagebrush filed the lawsuit in the California Superior Court in Ventura County, where Amgen is
headquartered. The complaint asserts five causes of action against Amgen for violating
California law and seeks to protect patients’ access to affordable care, particularly for the
economically challenged and uninsured populations Sagebrush primarily serves.
The dispute centers on the 340B Drug Pricing Program, which allows eligible healthcare
organizations (“covered entities”), such as Sagebrush’s clinics, to purchase outpatient drugs at
significantly reduced prices. In its complaint, Sagebrush asks the court to order the return of not
less than $7 million that Amgen improperly took from Sagebrush, and to award treble (triple)
damages under California law, as well as punitive damages to “punish Amgen and deter future
similar conduct.”
Lawsuit Alleges Amgen Ignored Established Federal Process
According to the complaint, the issue began nearly two years ago when Amgen unilaterally
determined that Sagebrush was not an eligible entity under the 340B Program. The lawsuit
asserts that Amgen, a $184 billion company, disregarded the established federal process for
challenging a covered entity’s eligibility and instead took unilateral action.
The lawsuit also cites a letter from Amgen’s attorneys to a U.S. Senate committee, in which they
acknowledged that “the 340B program is not designed to permit even this modest level of
manufacturer oversight” and that manufacturers “are not equipped or permitted to police
compliance.”
Statement from Sagebrush CEO
Guru Charan, the founder and CEO of Sagebrush Health Services, says, “We tried every step to
avoid this lawsuit, but Amgen left us no choice. It’s vitally important that we continue to protect
our patients’ access to the federal 340B Program and to the services it allows us to provide. We
believe we’re standing up not only for our Nevada patients but also for those served by the
additional 3,500 Section 318 grantees. These grantees provide health care to hundreds of
thousands of people across the U.S. We must succeed to protect them as well.”
Notably, in March, the U.S. Department of Health and Human Services (HHS) confirmed
Sagebrush’s eligibility as a covered entity under the 340B Program during a federal court
hearing.