Johnson & Johnson Abandons Drug Rebate Proposal

Johnson & Johnson has abandoned its proposed 340B rebate model for drug discounts due to pressure from the Biden administration and the Health Resources and Services Administration (HRSA), which threatened penalties if J&J proceeded. The company had initially planned to require hospitals to pay full price for its drugs Stelara and Xarelto upfront and apply for rebates later, which raised concerns among healthcare advocates. Following bipartisan congressional opposition, with 189 members urging HRSA to act, J&J reversed its decision and will continue to provide upfront discounts under the 340B program. The American Hospital Association praised J&J's decision, highlighting the potential harm the rebate model could have caused to patients and hospitals. This move reflects the ongoing scrutiny and regulatory pressure faced by pharmaceutical companies regarding pricing practices for low-income and uninsured patients.