California Healthline Daily Edition

Summaries of health policy coverage from major news organizations

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Drugmakers Face Fines For Overcharging Hospitals For Medicine Purchased Under Federal Discount Program

In other marketplace news, closing arguments in the Anthem-Cigna merger antitrust trial are delivered and a filing alleges that Alexion managers encouraged improper sales practices by employees.

Modern Healthcare: Drug Companies Will Be Fined For Overcharging 340B Hospitals
The Obama administration has finalized a rule that imposes fines on drug companies that overcharge hospitals and clinics for medication purchased under the government's 340B drug discount program. Drug companies must reimburse providers that overpaid for products and they are subject to fines of up to $5,000 per instance if they overcharged "knowingly and intentionally." The penalties were outlined in a final rule released Wednesday by HHS' Health Resources and Services Administration. The rule also establishes a system for calculating “ceiling prices” for covered outpatient drugs—which some industry stakeholders say the agency lacks the authority to do. (Dickson, 1/4)

Politico Pro: Trial Contesting Anthem's $54 Billion Acquisition Of Cigna Wraps
The fate of Anthem’s $54 billion acquisition of Cigna, which would create the largest health insurance company in the country, is now in the hands of a federal judge. Lawyers for the Justice Department and Anthem made their closing arguments in the antitrust trial on Wednesday morning, during which they were peppered with persistent questioning from U.S. District Court Judge Amy Berman Jackson. (Demko, 1/4)

The Wall Street Journal: Alexion Says Senior Management Improperly Pressured Staff To Boost Sales
The finding, reported in a securities filing, followed an investigation by members of Alexion’s board of directors into allegations of improper sales practices made by a former employee that had delayed the submission of its most-recent financial report. Alexion, based in New Haven, Conn., is a leading seller of drugs for rare diseases and had $2.6 billion in 2015 total product revenues. Soliris, the drug at the center of the investigation, treats a rare blood disorder known as paroxysmal nocturnal hemoglobinuria. (Rockoff, 1/4)

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