Article
Healthcare & Life Sciences: Drug Pricing Digest — Number 81
September 21, 2026
Our Drug Pricing and Market Access team tracks recent developments in healthcare reform, the Medicaid Drug Rebate Program, the 340B Program, Medicare, and state law.
Inflation Reduction Act, Healthcare Reform, and General Developments
MFN DEVELOPMENTS
On September 18, 2026, the White House announced that all 50 states, Puerto Rico, and the District of Columbia will participate in the voluntary Generous payment model, which we discussed in issue No. 80 of this digest. The Centers for Medicare & Medicaid Services (CMS) also issued a press release. This follows the recent announcement on August 31, 2026, that nine manufacturers are participating in Generous. It remains unclear which of the participating manufacturers’ drugs the states will select. Dr. Mehmet Oz, the CMS Administrator, indicated that pricing agreements with additional pharmaceutical manufacturers are forthcoming.
Sources: The Hill, BloombergLaw (first, second), InsideHealthPolicy, StatNews, PoliticoPro.
Meanwhile, Dr. Inma Hernandez, Senior Advisor to the Administrator for Drug Prices with CMS, discussed the interplay between the most favored nation (MFN) drug pricing policy and cell and gene therapies.
Source: PinkSheet.
The terms of the 17 initial MFN agreements with manufacturers remain confidential, but additional details were reported following a Freedom of Information Act (FOIA) request. We discussed these initial agreements in issue No. 71 of this digest.
Source: Washington Post.
The MFN drug pricing policy was a subject of questioning in the confirmation hearings of Chris Klomp for the position of Deputy Secretary of the Department of Health & Human Services (HHS).
Sources: InsideHealthPolicy, PinkSheet, PoliticoPro.
Stakeholders continue to discuss the implications of the MFN drug pricing policy and pharmaceutical tariffs, including on ex-US markets.
Sources: Law360 (first, second), BioWorld (first, second), PinkSheet, PoliticoPro (first, second), StatNews, In Vivo.
STAKEHOLDERS CONTINUE TO DISCUSS IRA NEGOTIATION IMPACTS
Stakeholders continue to discuss how the drug pricing negotiation program established under the Inflation Reduction Act (IRA) may impact the pharmaceutical industry and how it is currently being implemented by CMS.
Sources: PinkSheet, BloombergLaw.
Medicaid Drug Rebate Program (MDRP)
No developments to report.
340B Program
PART D CLAIMS DATA REPOSITORY TESTING PERIOD TO COMMENCE IN OCTOBER
The IRA introduced an inflation rebate in the Part D program but excludes units purchased under the 340B program from rebate eligibility. CMS “created the 340B repository to test whether data submitted by covered entities (or their… contracted partners on their behalf) could be used by CMS in the future to identify 340B units to remove from Part D inflation rebate calculations.” The agency has now announced that the testing period for the claims data repository will commence on October 1, 2026. Covered entities are currently not required to submit data to the repository.
Source: 340B Report.
MEDICARE GLP-1 BRIDGE PILOT DUPLICATE DISCOUNT CONCERNS
Commenters have noted that the temporary Medicare GLP-1 Bridge program, which provides beneficiaries access to GLP-1 drugs for a monthly out-of-pocket cost of $50 with no deductible, could be adversely impacted by 340B duplicate discounts. As with 340B duplicate discounts in other areas, the problem arises when the manufacturer experiences both a 340B discount and a bridge program discount on the same unit.
Source: InsideHealthPolicy.
LEGISLATIVE 340B REFORM
Stakeholders continue to discuss possible legislative actions regarding the 340B program. We discussed proposed legislation in issues No. 75 and No. 78 of this digest.
Source: BloombergLaw.
REBATE PILOT DEVELOPMENTS
As discussed in issue No. 65 of this digest, the Health Resources & Services Administration (HRSA) withdrew the original rebate model that was scheduled to commence on January 1, 2026, in response to litigation.
One remaining issue is whether it was appropriate for pharmaceutical manufacturers to be excluded from that lawsuit.
Sources: Law360, 340B Report.
LITIGATION REGARDING “PATIENT” DEFINITION CONTINUES
Litigation brought by a major pharmaceutical manufacturer to challenge the definition of “patient” under the 340B program is proceeding. We discussed the litigation in issue No. 70 of this digest.
Source: Law360.
CONGRESSIONAL RESEARCH SERVICE REPORT DISCUSSES 340B STATE LAWS
On August 31, 2026, the Congressional Research Service issued a report titled “State Actions to Lower Drug Prices: Selected Legal Issues.” The report includes a detailed discussion of state laws relating to the 340B program.
Source: 340B Report.
MANUFACTURER CHALLENGES TO STATE 340B LAWS CONTINUE
Drug manufacturer litigation challenging the 340B laws enacted by various states continues.
Source: 340B Report (first, second, third).
Medicare Part B
No developments to report.
Medicare Part D
No developments to report.
State Law Developments
No developments to report.
Endnotes
This publication is produced by Latham & Watkins as a news reporting service to clients and other friends. The information contained in this publication should not be construed as legal advice. Should further analysis or explanation of the subject matter be required, please contact the lawyer with whom you normally consult. The invitation to contact is not a solicitation for legal work under the laws of any jurisdiction in which Latham lawyers are not authorized to practice. See our Attorney Advertising and Terms of Use.