Program Audit Results updated 01/04/2014
HRSA has the authority to audit covered entities for compliance with 340B Drug Pricing Program (340B Program) requirements (42 USC 256b(a)(5)(C)):
AUDITING. — A covered entity shall permit the Secretary and the manufacturer of a covered outpatient drug that is subject to an agreement under this subsection with the entity (acting in accordance with procedures established by the Secretary relating to the number, duration, and scope of audits) to audit at the Secretary’s or the manufacturer’s expense the records of the entity that directly pertain to the entity’s compliance with the requirements described in subparagraphs (A) or (B) with respect to drugs of the manufacturer.
Subparagraph (A) under 42 USC 256b(a)(5) prohibits requiring manufacturers to pay discounts or rebates under both the 340B Program and the Medicaid Drug Rebate Program (duplicate discounts).
Subparagraph (B) of 42 USC 256b(a)(5) prohibits resale of 340B drugs to a person who is not a patient of the entity (diversion).
This site will be updated regularly and will include information on audit results as they are completed with the associated sanctions or corrective actions. In FY 2012, HRSA conducted 51 audits of 340B covered entities. These audits were conducted using a 340B specific protocol and included a review of each covered entity’s compliance with 340B Program requirements. See 340B Program Audits of Covered Entities for audit number, duration, and scope.
HRSA provides covered entities 30 days to review proposed findings noted in the HRSA preliminary report. If a covered entity disagrees with the findings, a covered entity has the right to submit an explanation of the disagreement, with supporting documents, to HRSA within 30 calendar days of the date of the HRSA preliminary report. HRSA will then issue a Final Report. A second notice and hearing period provides covered entities 30 calendar days from the date of the HRSA Final Report to review findings noted in the HRSA Final Report, and to review HRSA’s request for a corrective action plan. Corrective action plans for diversion or duplicate discount findings will, at a minimum, include the requirement for the entity to work with manufacturers and the state Medicaid agency, if applicable, to determine whether repayment is necessary. If a covered entity agrees with the Final Report, a covered entity must submit a corrective action plan to HRSA within 60 calendar days for HRSA approval. If a covered entity disagrees with the Final Report and request for corrective action plan, it shall notify HRSA in writing within 30 calendar days with the appropriate supporting documentation.