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Arnold & Porter Obtains Important ACA Exemption for Pharma Industry from Mandatory Orphan Drug Discounts

October 19, 2015

WASHINGTON, DC, October 19, 2015 -- Arnold & Porter LLP obtained an important victory for the trade group Pharmaceutical Research and Manufacturers of America when it convinced a D.C. federal judge to rule that The Affordable Care Act fully exempts orphan drugs from mandatory discounts under the 340B program for certain health care providers. The decision from U.S. District Judge Rudolph Contreras vacated an interpretive rule issued last year by the U.S. Department of Health and Human Services. The agency had interpreted the ACA as requiring discounts when orphan drugs are used for diseases that aren't rare, but Arnold & Porter filed a lawsuit on behalf of PhRMA, arguing that the ACA eliminated the requirement for discounts no matter how an orphan designated drug is used. Judge Contreras agreed on Wednesday, writing that the ACA "makes no mention of whether the [orphan] drug is in fact used ... to treat the rare disease or condition for which it was designated."

Arnold & Porter's legal team was led by Jeffrey L. Handwerker and included Matthew T. Fornataro, and Kristin M. Hicks. The case is cited as Pharmaceutical Research and Manufacturers of America v. U.S. Department of Health and Human Services et al., case number 1:14-cv-01685, in the U.S. District Court for the District of Columbia.

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