Does HHS’s Elimination of the Safe Harbor for Manufacturer Rebates Leave Manufacturers with Increased Antitrust Risk?
On November 20, 2020, the U.S. Department of Health & Human Services (HHS) finalized a rule to take effect in 2022, which eliminates the safe harbor under the federal anti-kickback statute for manufacturer rebates to Medicare Part D plan sponsors. Under the current statutory scheme, drug manufacturers may negotiate rebates with providers of pharmacy benefits—either directly or through a pharmacy benefit manager (PBM)—in exchange for preferential placement or avoiding being disadvantaged on a PBM’s or provider’s drug formulary. The safe harbor permits such payments by confirming that rebates do not constitute illegal kickbacks under the federal statute. HHS’s new rule eliminates that safe harbor, but creates a safe harbor for negotiated discounts on the “list price” of the drug..