Eli Lilly has notified roughly 1,000 hospitals in the federal 340B drug discount program that they must submit comprehensive claims‑level data (CLD) within days or risk losing mandated price reductions.
The American Hospital Association (AHA) quickly condemned the move, calling it an unlawful escalation that would impose heavy administrative burdens on hospitals serving low‑income and rural communities.
Background
The conflict began in January, when Lilly announced it would require all covered entities to submit CLD for most of its drugs, including those dispensed through in‑house and contract pharmacies, starting February 1, 2026.
Lilly said the expanded reporting is needed to identify duplicate discounts, support audits, and increase transparency. Novo Nordisk issued a similar notice, according to Fierce Healthcare.
In a January 26 statement, Lilly argued the requirement “imposes no new burdens” because hospitals already collect and submit the data to insurers.
Hospital response
Hospitals counter that the new requirements far exceed past practices and could encourage other manufacturers to follow suit. In a January 26 letter, AHA urged the Health Resources and Services Administration (HRSA) to intervene, warning the policy would drive up costs, create operational challenges, and jeopardize access to discounts guaranteed under federal law. America’s Essential Hospitals echoed those concerns.
Lilly, in a communication to HRSA, as reported by Fierce Healthcare, rejected the objections and said the policy aligns with federal law and recent court rulings. The company emphasized the data would be used for compliance monitoring, not pricing changes.
The dispute comes as HHS weighs broader reforms to the 340B program. A proposed pilot replacing upfront discounts with manufacturer‑directed rebates was blocked in court earlier this year, though regulators have reopened public comment on a revised version.
Lilly told HRSA that courts have repeatedly cited manufacturers’ ability to obtain claims‑level data as justification for rejecting rebate‑based models.
The pharma giant went on to accuse AHA of being “more committed to concealing the abuse in the 340B program because hospitals profit from it. The message to AHA is clear: Stop opposing common-sense policies that will improve compliance, transparency, and the long-term sustainability of the manufacturer-funded 340B program and start prioritizing the patients that hospitals are supposed to serve.”
AHA response
In a June 1 statement, AHA intensified its criticism, arguing the policy threatens hospital resources and patient care. The association said it had attempted to negotiate a compromise earlier in the month but received no response from Lilly, and noted reports that the company briefed media before notifying hospitals.
“With today’s announcement, HHS can no longer sit on the sidelines,” said AHA president and CEO Rick Pollack. “[W]e ask HHS to show that same toughness here and prevent Lilly from moving forward with this illegal and harmful policy.”