Update: Litigation about the 340B program’s ‘patient’ definition could affect hospital savings

Note: This story is an update to prior coverage.

Providers weighing in on potentially disruptive litigation involving the 340B Drug Pricing Program say a ruling in favor of the drug manufacturer would have substantial implications for the program.

In a case brought by AbbVie Inc. against the federal government, the central question concerns the definition of patient for identifying scenarios where providers can access 340B discounts. AbbVie challenged the longstanding guidance established by the Health Resources and Services Administration (HRSA) regarding who qualifies as a 340B patient.

In a recent court filing, the advocacy group 340B Health and two hospitals seek to join HHS and HRSA as defendants in the case, which was filed in April at the U.S. District Court for Washington, D.C.

A narrower definition could affect referred patients

The proposed intervenors say AbbVie’s implied definition of patient would exclude many patients who currently are eligible to receive discounted drugs.

Under AbbVie’s definition, which seemingly would require a direct treatment relationship rather than simply a broad institutional affiliation, “many referred patients could become ineligible for 340B pricing because the referring provider may continue to participate in the patient’s care or maintain responsibility for aspects of the patient’s treatment,” the court filing states. “This approach does not reflect how specialty care is delivered in modern healthcare systems, where multiple providers routinely collaborate in the management of complex conditions.”

In addition to placing a significant share of providers’ 340B savings at risk, a ruling in favor of AbbVie would impose a significant compliance burden, according to the filing. One of the proposed intervenors, Genesis HealthCare, says it would need to spend more than $80,000 per year on infrastructure, in addition to hiring new FTEs.

Hospitals might have to scale back or eliminate assistance programs, reduce community health initiatives and limit access to specialty drugs, according to the filing.

Genesis “predicts that it will have to substantially reduce its 340B patient assistance program” if AbbVie prevails in the litigation. Patients could face higher out-of-pocket costs, conceivably leading to lower medication adherence and delayed or discontinued treatment.

Arguing that they have a direct stake in the matter and the government might not fully represent their interests in defending the case, the intervenors seek to be included in the proceedings.

HHS argues the lawsuit is premature

In another filing this month, HHS defended HRSA’s patient definition, which was established in 1996 guidance. HHS is seeking to have the case dismissed primarily on procedural grounds, saying AbbVie lacks standing to sue.

Among other issues raised in the filing, HHS said litigation is moot until AbbVie conducts 340B audits and, in the process, finds that providers are diverting 340B drugs to ineligible patients. Those providers would need a chance to respond, potentially triggering administrative dispute resolution and a finding by HRSA as to whether enforcement is warranted.

The administration says litigation would be viable only upon a final decision from HHS or HRSA. A September 2025 letter from HRSA to AbbVie merely amounted to preliminary guidance.

“AbbVie seeks an impermissible advisory opinion from this court regarding the definition of the term patient, by inviting the court to adjudicate what amounts to an interlocutory statement by the department [HHS] at best,” the new filing states.

HHS notes that manufacturers’ interests prevailed in a 2025 case in the same court, where providers challenged HRSA’s approval of manufacturer audits. The court dismissed that case, saying audit approval did not constitute final agency action.

“AbbVie’s dispute is in the same procedural posture,” HHS states.