340B News & Regulatory Updates — July 2026

The Most Important 340B Developments of July 2026

Published by 340bprogram.com | July 31, 2026
Sources: HRSA Federal Register, CMS, AHA, Covington & Burling, ArentFox Schiff, Bass Berry & Sims, AJMC, 340B Report, Goodwin Law, Senate HELP Committee, National Law Review

JULY 2026 OVERVIEW

July 2026 will go down as the single most consequential month in the 340B program’s modern history. Five major developments landed simultaneously — any one of which would have dominated a normal month. CMS proposed cutting Medicare Part B reimbursement for 340B drugs by nearly 40% on July 2. The House unveiled the bipartisan SECURE 340B Act on July 6. HRSA launched its revised rebate model pilot on July 31. The 4th Circuit delivered another devastating blow to state contract pharmacy protection laws — this time vacating Maryland’s law. And a New Hampshire hospital became the second to sue Eli Lilly for cutting off 340B pricing. Hospitals are now fighting a two-front war simultaneously: what they pay for 340B drugs on one side, and what Medicare pays them back on the other. July 2026 is the month every covered entity and contract pharmacy needs to understand in detail.

🚨 TOP STORY #1 — CMS PROPOSES 37% CUT TO MEDICARE 340B DRUG REIMBURSEMENT

July 2, 2026 — The 2027 OPPS Proposed Rule: ASP Minus 33.4%

The Centers for Medicare & Medicaid Services July 2 issued a proposed rule that would increase Medicare hospital outpatient prospective payment system rates by a net 2.4% in calendar year 2027 compared to 2026. Buried inside that routine update was the most financially significant 340B development of 2026.

Based on the results of the OPPS Drug Acquisition Cost Survey conducted from January 1 through April 7, 2026, CMS is proposing to pay for 340B-acquired drugs at ASP minus 33.4% beginning in CY 2027, down from the current rate of ASP plus 6%.

What this means in plain English: Right now, Medicare pays hospitals ASP plus 6% for every 340B drug they administer. Under the CMS proposal, Medicare would instead pay ASP minus 33.4% — a swing of nearly 40 percentage points on every 340B drug claim. That is not a rounding error. It is a fundamental restructuring of the financial model that sustains safety-net hospital 340B programs.

The financial scale: CMS estimates the change would save beneficiaries with original Medicare a collective $1.15 billion in drug costs and taxpayers an additional $4.55 billion in drug expenditures in the first year. Because the statute requires budget neutrality, OPPS payments for nondrug services would increase by an equivalent amount — meaning hospitals would receive more for services but dramatically less for drugs.

The legal foundation — and why it differs from 2018:
From 2018 through 2022, the agency paid for 340B drugs at ASP minus 22.5 percent, but the Supreme Court invalidated the policy in American Hospital Association v. Becerra (2022) on the grounds that CMS had not first conducted the acquisition cost survey the statute requires before varying payment rates for 340B hospitals. This time, CMS conducted the survey — which is why this proposal is legally on stronger footing than the 2018 policy. However it is not invulnerable. Legal challenges are widely expected.

The survey finding — and a critical problem with the math:
CMS also disclosed that the 340B ceiling price is, in aggregate, only 28% below mean ASP. Because the proposed 33.4% reduction exceeds this figure, certain hospitals could receive Medicare payment below their actual statutory ceiling acquisition cost — a result that undercuts CMS’s stated goal of paying at acquisition cost and would force covered entities to absorb losses on affected drug claims. CMS has solicited comments on an alternative rate of ASP minus 28%.

Who is exempt from the payment reduction:
Indian Health Service hospitals, Rural Emergency Hospitals, and Critical Access Hospitals are not reimbursed by Medicare under OPPS and therefore not subject to the payment adjustment. Sole community hospitals and PPS-exempt cancer hospitals are also exempt — these hospitals continue to receive ASP plus 6%.

An additional financial hit for some hospitals:
CMS proposes to accelerate recoupment of the $7.8 billion in excess non-drug payments that CMS made to all OPPS hospitals during the unlawful 2018–2022 period, increasing the annual reduction to 3% from 0.5%, applicable only to hospitals enrolled in Medicare before January 1, 2018. CMS projects full recoupment by approximately CY 2029.

The two-front war: Hospitals are now fighting a two-front war over the same underlying asset: what they pay for 340B drugs on one side, what Medicare pays them back on the other. Winning one front doesn’t insulate you from losing the other.

⚠️ Action required — deadline August 31, 2026:
Public comments on the CMS proposed rule are due August 31, 2026. Every covered entity that receives Medicare Part B reimbursement for 340B drugs should submit comments — either directly or through their hospital association. Focus your comments on the ASP minus 28% alternative rate, the budget neutrality mechanism, the impact on safety-net patient populations, and the legal risk of a rate below the actual 340B ceiling price. Submit via regulations.gov.

🚨 TOP STORY #2 — HRSA LAUNCHES REVISED REBATE MODEL PILOT — EFFECTIVE JANUARY 1, 2027

July 31, 2026 — HRSA Posts Revised 340B Rebate Model Pilot in Federal Register

On July 31, 2026, the Health Resources and Services Administration posted a Notice Regarding 340B Rebate Model Pilot Program in the Federal Register to announce the availability of a revised 340B Rebate Model Pilot Program. Consistent with HRSA’s 340B statutory authority, the Pilot provides a rebate mechanism through which qualifying manufacturers may effectuate the 340B ceiling price for certain drugs sold to covered entities.

This is the third attempt to launch a rebate model — after the August 2025 launch, the January 2026 court defeat, and the February 2026 RFI. HRSA is moving forward again.

What the revised pilot covers:
Participation in the Pilot Program is limited to manufacturers with drugs on the CMS Medicare Drug Price Negotiation Selected Drug Lists for initial price applicability years 2026 and 2027, which represents less than 5.5% of total 340B sales according to HRSA’s estimates. As a result, the vast majority of 340B transactions will continue to operate under the traditional upfront discount model, limiting the Pilot Program’s near-term impact.

The key dates:
Eligible manufacturers seeking to participate must submit plans to 340BPricing@hrsa.gov no later than August 24, 2026. HRSA will make approval decisions by September 24, 2026. Approved rebate models will take effect January 1, 2027. Participating manufacturers must commit to the pilot for at least one year.

Why this pilot may face the same legal challenge:
HRSA is implementing the program through an operative notice rather than first publishing a Notice of Proposed Rulemaking and receiving another round of comments. This procedural choice may remain subject to APA litigation; describing the document as a notice does not, by itself, resolve whether a court could view the policy as a substantive rule requiring notice-and-comment rulemaking.

The AHA stated it is considering all available options to prevent this flawed program from going into effect. Legal challenges from hospital groups are widely anticipated before the January 1, 2027 effective date.

What covered entities should do right now:
— Review the list of drugs included in the pilot (IRA negotiated drugs for 2026 and 2027)
— Determine whether any of your high-volume 340B drugs are on the pilot list
— Consult your TPA or 340B software vendor about operational readiness for a rebate model
— Monitor for manufacturer plan approvals by September 24, 2026
— Manufacturers must give covered entities 90 calendar days’ notice prior to implementation

⚠️ The White House connection: White House regulators completed their review of HRSA’s latest 340B rebate pilot proposal after reclassifying it as economically significant — signaling the highest level of administration attention and support for the rebate model.

🏛️ CONGRESSIONAL ACTIVITY — JULY 2026

July 6, 2026 — House Introduces SECURE 340B Act — First Comprehensive Bipartisan House 340B Bill

A bipartisan group of U.S. House members unveiled legislation on July 6 that would pause drug manufacturer 340B rebates, establish a new patient definition and create new contract pharmacy oversight rules.

Representatives Scott Peters (D-CA) and Dr. John Joyce (R-PA) introduced H.R. 9599, called the SECURE 340B Act — the Strengthening the Exercise of Controls and Upgrading Requirements for Efficiency in 340B Act — hailed as the first-ever comprehensive, bipartisan proposal to modernize the 340B Drug Pricing Program since its creation in 1992.

Key provisions of the SECURE 340B Act — what it would do:

Pause manufacturer rebates: The bill would pause drug manufacturer 340B rebates — a direct rebuke to HRSA’s simultaneously-launching rebate pilot. This creates a remarkable situation where the executive branch and a bipartisan House majority are pulling in opposite directions on the rebate model simultaneously.

New patient definition: The bill would establish a clearer statutory definition of which patients qualify for 340B-discounted drugs — a significant change that could affect covered entity eligibility calculations.

Contract pharmacy framework: The bill would create a new statutory framework for contract pharmacy arrangements — potentially providing the definitive legal resolution to years of manufacturer litigation over contract pharmacy access.

New compliance obligations: Both the Senate and House proposals would establish statutory frameworks for contract pharmacy arrangements, expand transparency requirements, and impose new compliance obligations on covered entities.

HRSA auditing and user fees: Beginning in fiscal year 2027, the HHS Secretary would assess an annual user fee on participating covered entities — generally 0.1 percent of what the entity paid for 340B covered outpatient drugs the prior year — to fund program administration and enhanced integrity and oversight activities.

What the bill does NOT address: Neither proposal addresses another significant issue currently facing the 340B Program: Medicare reimbursement. On July 2, CMS proposed reducing Medicare Part B reimbursement for 340B-acquired drugs from ASP plus 6% to ASP minus 33.4% beginning in CY 2027. The proposal follows an acquisition-cost survey and revisits a longstanding policy dispute.

The hospital reaction: The American Hospital Association slammed both the Senate and House proposals’ new requirements and pointed the finger at drugmakers. Hospital lobbyists say submitting detailed data is a burdensome requirement on safety-net facilities.

⚠️ What covered entities should do: Review the full text of H.R. 9599 and identify how the patient definition changes would affect your eligible patient population. Contact your Congressional representatives to weigh in before the bill advances. The bill will require committee consideration before any floor vote — it is not expected to pass in its current form in 2026, but its provisions will shape the negotiating landscape.

July 29, 2026 — Health Centers Brief Congressional Staffers on 340B Reform

ACH CEO Amanda Pears Kelly and three health center leaders discussed 340B reform during a July 29 briefing for congressional staffers — calling on Congress to pursue 340B reforms that protect health centers while increasing program accountability. The briefing focused on the Cassidy discussion draft’s patient eligibility provisions and the potential impact of the CMS reimbursement cut on FQHC-affiliated hospital covered entities.

⚖️ COURT DECISIONS — JULY 2026

July 2026 — 4th Circuit Again Sides With Manufacturers — Maryland’s Law Vacated

The 4th Circuit again sided with drugmakers, vacating the ruling upholding Maryland’s 340B contract pharmacy access law. This is the second consecutive 4th Circuit ruling against a state contract pharmacy protection law — following its March 31 ruling blocking West Virginia’s law.

What this means: Maryland’s contract pharmacy access law is now effectively vacated by the appellate court. Manufacturer contract pharmacy restrictions may reimpose in Maryland. The 4th Circuit has now established a clear pattern — federal law preempts state contract pharmacy access laws within its jurisdiction.

The circuit split deepens: The 4th Circuit’s position directly conflicts with the 8th Circuit’s ruling upholding Arkansas’ law. The split is now pronounced enough that Supreme Court review of state 340B laws appears increasingly inevitable within the next 12–18 months.

States in the 4th Circuit’s jurisdiction: Maryland, West Virginia, Virginia, North Carolina, and South Carolina. Covered entities in all five states should treat their contract pharmacy arrangements as operating without state law protection following these rulings.

Risk level — Maryland: 🔴 High — law vacated, manufacturer restrictions may reimpose

July 2026 — PhRMA Files Third Lawsuit Against Washington State

PhRMA filed a third separate lawsuit challenging Washington State’s new S.B. 5981 contract pharmacy access law — joining the AbbVie and Novartis suits already pending from March. Washington now faces three simultaneous manufacturer challenges to its contract pharmacy law, while the law itself remains in effect following the June 9 court ruling.

July 21, 2026 — D.C. District Court Upholds Earlier Ruling on Rebate-Related Case

The U.S. District Court for the District of Columbia on July 21 upheld an earlier ruling related to 340B rebate pilot litigation — maintaining the legal landscape established by the earlier Maine district court vacatur of the 2025 pilot. The specific ruling maintained that manufacturers cannot unilaterally implement rebate models without HRSA approval — a ruling that actually supports HRSA’s new July 31 pilot framework.

July 2026 — New Hampshire Hospital Sues Eli Lilly

New Hampshire-based Mary Hitchcock Memorial Hospital filed the second lawsuit challenging Eli Lilly’s move to cut off 340B pricing for hospitals that fail to submit in-house pharmacy claims data. This follows an earlier hospital lawsuit against Lilly filed in June. The accumulation of hospital-versus-manufacturer litigation is creating a new legal battlefront entirely separate from the state contract pharmacy law fights.

What the lawsuits allege: Lilly is unlawfully conditioning 340B pricing access on data submission requirements that go beyond what is permitted under the 340B statute. Hospitals argue that the statute requires manufacturers to provide 340B ceiling prices without condition.

July 2026 — 340B Coalition Summer Conference — Key Takeaways

The 340B Coalition Summer Conference arrived at a pivotal moment for the program. Key themes from the conference:

“Organized misinformation campaign” — The conference keynote characterized the pharmaceutical industry’s public messaging about 340B hospital markups as an organized misinformation campaign, citing the industry-funded studies and coordinated PhRMA advocacy efforts targeting hospital 340B programs.

Rebate threats and data demands — Since the winter conference, manufacturer restrictions have continued to evolve, federal officials have taken additional steps toward a potential rebate model, and court decisions have reshaped the state law landscape significantly.

The summer conference consensus: Every major covered entity advocacy organization at the conference called for opposition to the CMS reimbursement cut proposed rule, legal challenges to the HRSA rebate pilot if necessary, and submission of comments on both the Cassidy Senate draft and the House SECURE 340B Act.

🔬 MANUFACTURER POLICY CHANGES — JULY 2026

July 1–15, 2026 — OPAIS Registration Window

The third quarterly OPAIS contract pharmacy registration window of 2026 opened July 1 and closed July 15. Pharmacies and covered entities that registered during this window received an October 1, 2026 program start date.

Missed this window? The next window opens October 1–15, 2026, with a program start date of January 1, 2027.

OPAIS compliance reminder: Given the Maryland and West Virginia 4th Circuit rulings, covered entities in those states should carefully review their OPAIS contract pharmacy registrations to assess which arrangements may be affected by manufacturer restrictions now that state law protections are vacated.

July 2026 — Manufacturer Voluntary Exemptions Continue Expanding

Several manufacturers continued to voluntarily exempt additional states from their contract pharmacy restrictions — particularly in states with enacted contract pharmacy access laws. This pattern of manufacturers selectively exempting protected states while maintaining restrictions in unprotected states is increasingly common. Contact each manufacturer’s 340B pricing team to confirm current exemption status for your state and product portfolio.

July 2026 — AstraZeneca Becomes Latest Manufacturer to Announce Additional In-House Data Requirements

AstraZeneca announced additional products being added to its in-house pharmacy claims data requirements — expanding beyond the 19 products announced in the May 1 rollout. AstraZeneca becomes the latest manufacturer to announce 340B in-house pharmacy data requirements for this expanded product set.

📊 REGULATORY UPDATES — JULY 2026

July 15, 2026 — HRSA Information Collection Request Comment Deadline Passes

The 30-day comment period for HRSA’s June 15 Information Collection Request on the revised rebate model pilot program closed July 15, 2026. This was a procedural step — not a substantive comment period on the pilot policy itself. HRSA used the collected data to finalize the operational framework for the July 31 pilot notice.

July 2026 — HHS to Issue 340B Rebate Guidance Within 30 Days

HHS announced it will issue guidance on 340B rebates and the interaction between the rebate model and the IRA’s Maximum Fair Price within 30 days of the July 31 pilot notice. This guidance is expected to clarify how the rebate model interacts with the deduplication requirements under the Inflation Reduction Act — one of the most technically complex issues in the program’s current implementation.

July 2026 — Trump Administration Accelerates Biosimilar Development — 340B Implications

The Trump administration announced plans to accelerate biosimilar development — a policy that could significantly affect 340B program economics over the next several years. As biosimilars replace branded drugs in the 340B formulary, acquisition cost differentials change, which in turn affects both the financial value of the 340B discount and the impact of manufacturer data requirements tied to specific branded products. Watch for HRSA guidance on how biosimilar 340B pricing will be handled under the rebate pilot framework.

🗺️ STATE LEGISLATIVE UPDATES — JULY 2026

July 2026 — State Scorecard Update

New losses in July:
— Maryland: Law vacated by 4th Circuit

Currently protected and in effect:
Arkansas, Louisiana, Mississippi, Minnesota, Tennessee, Washington, Illinois, Missouri, Colorado (appealing), Hawaii (appealing), Nebraska (appealing), Utah (appealing), Vermont (appealing), Oregon (appealing), Idaho, South Dakota, Rhode Island, Maine, Oklahoma (AG appealing block), and others

Currently unprotected or blocked:
West Virginia (4th Circuit blocked), North Dakota (permanently enjoined), Oklahoma (law blocked before taking effect — AG appealing), Maryland (4th Circuit vacated), Kansas (law expired June 30), Virginia (vetoed)

No law enacted:
California, Texas, Georgia, Ohio, Pennsylvania, Indiana, New York (bill advancing)

July 2026 — Minnesota Senators Aim to Strengthen Existing Law

Minnesota state senators introduced legislation to strengthen Minnesota’s existing 340B contract pharmacy access law — adding stronger enforcement mechanisms and higher penalties for manufacturer violations. The bill has not yet advanced to a committee vote.

📅 KEY DATES IN AUGUST 2026

August 24, 2026 — Deadline for manufacturers to submit rebate pilot plans to HRSA — 340BPricing@hrsa.gov

August 28, 2026 — Deadline for stakeholder comments on Senator Cassidy’s 340B for Patients Act — 340bforpatients@help.senate.gov

August 31, 2026 — Deadline for comments on CMS proposed rule cutting Medicare Part B 340B reimbursement — submit via regulations.gov

September 24, 2026 — HRSA announces manufacturer approvals for the 2027 rebate pilot

October 1, 2026 — Manufacturers with approved rebate plans must begin giving covered entities 90 days’ notice before January 1, 2027 implementation

October 1–15, 2026 — Next OPAIS registration window — program start date January 1, 2027

⚠️ JULY 2026 URGENT ACTION CHECKLIST

Three comment deadlines in August mean you need to act immediately. Work through this checklist before August 1:

☐ CMS Proposed Rule (August 31) — Submit comments opposing ASP minus 33.4% for 340B drugs. Request ASP minus 28% alternative. Highlight safety-net patient impact. Submit via regulations.gov using the 2027 OPPS docket number.

☐ Cassidy Discussion Draft (August 28) — Submit comments to 340bforpatients@help.senate.gov. Address patient eligibility changes, contract pharmacy codification, and rebate model provisions.

☐ HRSA Rebate Pilot (Monitor) — Identify which of your 340B drugs are on the IRA negotiated drug list for 2026/2027. Assess operational readiness for a potential rebate model for those specific drugs.

☐ Maryland and West Virginia — If you are in either state, contact manufacturers directly to confirm current contract pharmacy access status now that both state laws have been vacated or blocked.

☐ AstraZeneca Data Requirements — Confirm your covered entity is submitting claims data for the newly expanded AstraZeneca product list.

☐ OPAIS — If you registered during the July 1–15 window, confirm your registration was approved and your October 1, 2026 start date is confirmed in OPAIS.

☐ New Hampshire / Lilly lawsuits — If your covered entity is non-compliant with Lilly in-house data requirements, assess your legal exposure in light of the accumulating hospital litigation against Lilly.

💊 HOW THIS AFFECTS YOUR 340B PATIENTS — AND HOW BLISTER CARDS HELP

July 2026 confirmed what the year’s earlier months had been building toward: the 340B program is simultaneously under pressure from all directions — from CMS above, from manufacturers in the courts, from Congress on Capitol Hill, and from the executive branch through the rebate pilot. The financial stakes have never been higher.

In this environment, the most important thing an independent contract pharmacy can demonstrate is direct, measurable patient benefit. The Cassidy draft and the SECURE 340B Act both emphasize patient benefit as the program’s core purpose. The CMS comment period is asking whether 340B savings are reaching patients. Every stakeholder in July 2026 is asking the same question: does 340B actually help patients?

Blister card medication packaging is one of the clearest, most documentable answers to that question. When you can show that your pharmacy’s 340B patients experienced a measurable improvement in medication adherence — from 61% to 96% — because of the packaging system you offered them, you have answered the central question of the entire 2026 reform debate. Real outcomes. Real patients. Real proof.

[Shop Blister Cards at MedicationPackagingSolutions.com →]

🔗 KEY SOURCES FOR JULY 2026

HRSA Official 340B Rebate Pilot Notice — federalregister.gov | hrsa.gov/opa

CMS 2027 OPPS Proposed Rule — cms.gov | Comment deadline August 31, 2026 via regulations.gov

AHA July 31 Statement on Rebate Pilot — aha.org

Covington & Burling — Rebate Pilot Analysis — cov.com

ArentFox Schiff — OPPS Rule Analysis — afslaw.com

Bass Berry & Sims — Medicare Payment Cuts Analysis — bassberry.com

AJMC — 340B Payment Cut Overview — ajmc.com

Senate HELP Committee — Cassidy Draft Comments — help.senate.gov | 340bforpatients@help.senate.gov

340B Report — SECURE 340B Act and Summer Conference — 340breport.com

340B Prime Vendor Program — 340bpvp.com | 1-888-340-2787

Information in this update is provided for general educational purposes by 340bprogram.com, published by Medication Packaging Solutions LLC, Clearwater, Florida. Sources include HRSA, U.S. federal courts, Forvis Mazars, Feldesman Tucker, Quarles Law, HFMA, and other publicly available resources. This is not legal or compliance advice. For compliance-specific guidance, consult a qualified 340B compliance consultant or healthcare attorney. Published: January 31, 2026.