83_FR_20096 83 FR 20008 - 340B Drug Pricing Program Ceiling Price and Manufacturer Civil Monetary Penalties Regulation

83 FR 20008 - 340B Drug Pricing Program Ceiling Price and Manufacturer Civil Monetary Penalties Regulation

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Federal Register Volume 83, Issue 88 (May 7, 2018)

Page Range20008-20011
FR Document2018-09711

The Health Resources and Services Administration (HRSA) administers section 340B of the Public Health Service Act, referred to as the ``340B Drug Pricing Program'' or the ``340B Program.'' HHS is soliciting comments on further delaying the effective date of the January 5, 2017, final rule that sets forth the calculation of the ceiling price and application of civil monetary penalties, and applies to all drug manufacturers that are required to make their drugs available to covered entities under the 340B Program. HHS proposes to further delay the effective date of the final rule published in the Federal Register from July 1, 2018, to July 1, 2019. HHS proposes this action to allow a more deliberate process of considering alternative and supplemental regulatory provisions and to allow for sufficient time for additional rulemaking.

Federal Register, Volume 83 Issue 88 (Monday, May 7, 2018)
[Federal Register Volume 83, Number 88 (Monday, May 7, 2018)]
[Proposed Rules]
[Pages 20008-20011]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-09711]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

42 CFR Part 10

RIN 0906-AB18


340B Drug Pricing Program Ceiling Price and Manufacturer Civil 
Monetary Penalties Regulation

AGENCY: Health Resources and Services Administration, HHS.

ACTION: Notice of proposed rulemaking; further delay of effective date.

-----------------------------------------------------------------------

SUMMARY: The Health Resources and Services Administration (HRSA) 
administers section 340B of the Public Health Service Act, referred to 
as the ``340B Drug Pricing Program'' or the ``340B Program.'' HHS is 
soliciting comments on further delaying the

[[Page 20009]]

effective date of the January 5, 2017, final rule that sets forth the 
calculation of the ceiling price and application of civil monetary 
penalties, and applies to all drug manufacturers that are required to 
make their drugs available to covered entities under the 340B Program. 
HHS proposes to further delay the effective date of the final rule 
published in the Federal Register from July 1, 2018, to July 1, 2019. 
HHS proposes this action to allow a more deliberate process of 
considering alternative and supplemental regulatory provisions and to 
allow for sufficient time for additional rulemaking.

DATES: Submit comments on or before May 22, 2018.

ADDRESSES: You may submit comments, identified by the Regulatory 
Information Number (RIN) 0906-AB18, by any of the following methods. 
Please submit your comments in only one of these ways to minimize the 
receipt of duplicate submissions.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow instructions for submitting comments. This is the preferred 
method for the submission of comments.
     Email: 340BCMPNPRM@hrsa.gov. Include 0906-AB11in the 
subject line of the message.
     Mail: Office of Pharmacy Affairs (OPA), Healthcare Systems 
Bureau (HSB), Health Resources and Services Administration (HRSA), 5600 
Fishers Lane, Mail Stop 08W05A, Rockville, MD 20857.
    All comments submitted will be available to the public in their 
entirety. Please do not submit confidential commercial information or 
personally identifying information that you do not want in the public 
domain.

FOR FURTHER INFORMATION CONTACT: CAPT Krista Pedley, Director, OPA, 
HSB, HRSA, 5600 Fishers Lane, Mail Stop 08W05A, Rockville, MD 20857, or 
by telephone at 301-594-4353.

SUPPLEMENTARY INFORMATION:

I. Background

    HHS published a notice of proposed rulemaking (NPRM) on June 17, 
2015, to implement civil monetary penalties (CMPs) for manufacturers 
that knowingly and intentionally charge a covered entity more than the 
ceiling price for a covered outpatient drug; to provide clarity 
regarding the requirement that manufacturers calculate the 340B ceiling 
price on a quarterly basis; and to establish the requirement that a 
manufacturer charge $.01 (penny pricing) for each unit of a drug when 
the ceiling price calculation equals zero (80 FR 34583, June 17, 2015). 
After review of the initial comments, HHS reopened the comment period 
(81 FR 22960, April 19, 2016) to invite additional comments on the 
following areas of the NPRM: 340B ceiling price calculations that 
result in a ceiling price that equals zero (penny pricing); the 
methodology that manufacturers use when estimating the ceiling price 
for a new covered outpatient drug; and the definition of the ``knowing 
and intentional'' standard to be applied when assessing a CMP for 
manufacturers that overcharge a covered entity.
    On January 5, 2017, HHS published a final rule in the Federal 
Register (82 FR 1210, January 5, 2017); comments from both the original 
comment period established in the NPRM and the reopened comment period 
announced in the April 19, 2016, notice were considered in the 
development of the final rule. The provisions of that final rule were 
to be effective March 6, 2017; however, HHS issued a subsequent final 
rule (82 FR 12508, March 6, 2017) delaying the effective date to March 
21, 2017, in accordance with a January 20, 2017, memorandum from the 
Assistant to the President and Chief of Staff, titled ``Regulatory 
Freeze Pending Review.'' \1\
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    \1\ See: https://www.whitehouse.gov/the-press-office/2017/01/20/memorandum-heads-executive-departments-and-agencies.
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    To provide affected parties sufficient time to make needed changes 
to facilitate compliance, and because questions were raised, HHS issued 
an interim final rule (82 FR 14332, March 20, 2017) to delay the 
effective date of the final rule to May 22, 2017. HHS solicited 
additional comments on whether that date should be further extended to 
October 1, 2017. After careful consideration of the comments received, 
HHS delayed the effective date of the January 5, 2017, final rule to 
October 1, 2017 (82 FR 22893, May 19, 2017).
    HHS later solicited comment on delaying the effective date of the 
January 5, 2017, final rule to July 1, 2018 (82 FR 39553, August 21, 
2017). After consideration of the comments received, HHS delayed the 
effective date of the January 5, 2017, final rule to July 1, 2018 (82 
FR 45511, September 29, 2017).

II. Proposal To Delay the Effective Date of the Final Rule

    HHS proposes to further delay the effective date of the January 5, 
2017, final rule as HHS intends to engage in additional or alternative 
rulemaking on these issues, and as discussed in more detail on page 5, 
the Department believes it would be counterproductive to effectuate the 
final rule prior to issuance of additional or alternative rulemaking on 
these issues. HHS is in the process of developing new comprehensive 
policies to address the rising costs of prescription drugs. Those 
policies will address drug pricing in government programs, such as 
Medicare Parts B & D, Medicaid, and the 340B discount drug program. 
Accordingly, we are proposing to delay the effective date of the final 
rule entitled ``340B Drug Pricing Ceiling Price and Manufacturer Civil 
Monetary Penalties Regulation.'' See 82 FR 1210 (Jan. 5, 2017).
    This rule is currently scheduled to go into effect on July 1, 2018; 
we are proposing to delay further the effective date to July 1, 2019. 
We do not believe that this delay will adversely affect any of the 
stakeholders in a meaningful way. The final rule implements both penny 
pricing and a provision in the Affordable Care Act contemplating civil 
money penalties for those who fail to provide the proper 340B discounts 
to covered entities. The so-called penny pricing provision would allow 
manufacturers to charge $0.01 for a drug with when the ceiling price 
calculation results in a zero amount. As discussed in the January 5, 
2017 final rule, a small number of manufacturers have informed HHS over 
the last several years that they charge more than $0.01 for a drug with 
a ceiling price below $0.01. However, this is a long-standing HHS 
policy, and HHS believes the majority of manufacturers currently follow 
the practice of charging a $0.01. Therefore, the delay of this portion 
of the regulation would not result in a significant economic impact.
    Delaying implementation of the 340B-specific CMPs should have no 
adverse effect given that other more significant remedies are available 
to entities that believe that they have not been provided the full 
discount that they are entitled to receive under the program. This 
proposed delay, though, will save the healthcare sector compliance 
costs, as described in the January 5, 2017 issuance of the final rule.
    HHS believes that the proposed delay would allow necessary time to 
consider more fully the substantial questions of fact, law, and policy 
identified by the Department during its review of the rule pursuant to 
the aforementioned ``Regulatory Freeze Pending Review,'' memorandum. 
Requiring manufacturers to make targeted and potentially costly changes 
to pricing systems and business procedures to comply with a rule that 
is under further consideration would be disruptive.

[[Page 20010]]

    As background, the January 20, 2017, Executive Order entitled, 
``Minimizing the Economic Burden of the Patient Protection and 
Affordable Care Act Pending Repeal,'' specifically instructs HHS and 
all other heads of executive offices to utilize all authority and 
discretion available to delay the implementation of certain provisions 
or requirements of the Patient Protection and Affordable Care Act.\2\ 
The January 5, 2017, final rule is based on changes made to the 340B 
Program by the Patient Protection and Affordable Care Act. HHS is 
proposing to further delay the effective date of the January 5, 2017, 
final rule to July 1, 2019, to more fully consider the regulatory 
burdens that may be posed by this final rule.
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    \2\ See: https://www.thefederalregister.org/fdsys/pkg/FR-2017-01-24/pdf/2017-01799.pdf.
---------------------------------------------------------------------------

    At this time, HHS seeks public comment regarding the impact of 
delaying the effective date of the final rule, published January 5, 
2017, for an additional 12 months from the current effective date of 
July 1, 2018, to Ju1y 1, 2019, while a more deliberate rulemaking 
process is undertaken. HHS is soliciting public comments for a 
shortened 15-day period because parties have had ample opportunity to 
comment on the two prior delays of the effective date of the underlying 
340B regulation, and the impact of this delay on the regulated 
community is de minimis. Given the prior opportunities to comment on 
the underlying proposed regulation and the delays, we do not envision 
receiving any novel comments. Moreover, we believe that the delay of 
the CMP authority can be issued without the opportunity for public 
comment because it delays the effective date of a regulatory 
restriction. HHS encourages all stakeholders to provide comments on 
this proposed rule.

III. Regulatory Impact Analysis

    HHS has examined the effects of this proposed rule as required by 
Executive Order 12866 on Regulatory Planning and Review (September 30, 
1993), Executive Order 13563 on Improving Regulation and Regulatory 
Review (January 8, 2011), the Regulatory Flexibility Act (Pub. L. 96-
354, September 19, 1980), the Unfunded Mandates Reform Act of 1995 
(Pub. L. 104-4), and Executive Order 13132 on Federalism (August 4, 
1999).

Executive Orders 12866, 13563, and 13771

    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 is supplemental to and reaffirms the principles, 
structures, and definitions governing regulatory review as established 
in Executive Order 12866, emphasizing the importance of quantifying 
both costs and benefits, of reducing costs, of harmonizing rules, and 
of promoting flexibility. Section 3(f) of Executive Order 12866 defines 
a ``significant regulatory action'' as an action that is likely to 
result in a rule: (1) Having an annual effect on the economy of $100 
million or more in any one year, or adversely and materially affecting 
a sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or Tribal 
governments or communities (also referred to as ``economically 
significant''); (2) creating a serious inconsistency or otherwise 
interfering with an action taken or planned by another agency; (3) 
materially altering the budgetary impacts of entitlement grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) raising novel legal or policy issues arising out of 
legal mandates, the President's priorities, or the principles set forth 
in the Executive Order. A regulatory impact analysis must be prepared 
for major rules with economically significant effects ($100 million or 
more in any one year), and a ``significant'' regulatory action is 
subject to review by the Office of Management and Budget (OMB).
    HHS does not believe that the proposal to further delay the 
effective date of the January 5, 2017, final rule will have an economic 
impact of $100 million or more, and therefore, this NPRM has not been 
designated as an ``economically significant'' proposed rule under 
section 3(f)(1) of the Executive Order 12866. The economic impact of 
having no rule in place related to the policies addressed in the final 
rule is believed to be minimal.
    Executive Order 13771, entitled Reducing Regulation and Controlling 
Regulatory Costs, was issued on January 30, 2017. This action's 
designation as regulatory or deregulatory will be discussed in the 
final rule and be informed by comments received in response to this 
proposed rule.

The Regulatory Flexibility Act (RFA)

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA) and the 
Small Business Regulatory Enforcement and Fairness Act of 1996, which 
amended the RFA, require HHS to analyze options for regulatory relief 
for small businesses. If a rule has a significant economic effect on a 
substantial number of small entities, the Secretary must specifically 
consider the economic effect of the rule on small entities and analyze 
regulatory options that could lessen the impact of the rule. HHS will 
use an RFA threshold of at least a 3 percent impact on at least 5 
percent of small entities.
    For purposes of the RFA, HHS considers all health care providers to 
be small entities either by meeting the Small Business Administration 
(SBA) size standard for a small business, or by being a nonprofit 
organization that is not dominant in its market. The current SBA size 
standard for health care providers ranges from annual receipts of $7 
million to $35.5 million. As of January 1, 2018, over 12,800 covered 
entities participate in the 340B Program, representing safety-net 
health care providers across the country. HHS has determined, and the 
Secretary certifies, that this proposed rule would not have a 
significant impact on the operations of a substantial number of small 
manufacturers; therefore, we are not preparing an analysis of impact 
for this RFA. HHS estimates that the economic impact on small entities 
and small manufacturers would be minimal. HHS welcomes comments 
concerning the impact of this proposed rule on small manufacturers.

Unfunded Mandates Reform Act

    Section 202(a) of the Unfunded Mandates Reform Act of 1995 requires 
that agencies prepare a written statement, which includes an assessment 
of anticipated costs and benefits, before proposing ``any rule that 
includes any Federal mandate that may result in the expenditure by 
State, local, and Tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any one year.'' In 2017, the threshold level was 
approximately $148 million. HHS does not expect this rule to exceed the 
threshold.

Executive Order 13132--Federalism

    HHS has reviewed this proposed rule in accordance with Executive 
Order 13132 regarding federalism, and has determined that it does not 
have ``federalism implications.'' This proposed rule would not ``have 
substantial direct effects on the States, or on the relationship 
between the national government and the States, or on the distribution 
of power and

[[Page 20011]]

responsibilities among the various levels of government.''

Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires 
that OMB approve all collections of information by a federal agency 
from the public before they can be implemented. This proposed rule is 
projected to have no impact on current reporting and recordkeeping 
burden for manufacturers under the 340B Program. This proposed rule 
would result in no new reporting burdens. Comments are welcome on the 
accuracy of this statement.

    Dated: May 1, 2018.
George Sigounas,
Administrator, Health Resources and Services Administration.
    Approved: May 2, 2018.
Alex M. Azar II,
Secretary, Department of Health and Human Services.
[FR Doc. 2018-09711 Filed 5-4-18; 8:45 am]
BILLING CODE 4165-15-P



                                                 20008                     Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Proposed Rules

                                                 criteria, and advances in knowledge                       Additional instructions on                          low-income populations, in the
                                                 showing scientific concerns with the                    commenting or visiting the docket,                    development, implementation, and
                                                 logic underpinning the criteria as                      along with more information about                     enforcement of environmental laws,
                                                 constructed in 1994, the Agency cannot                  dockets generally, is available at http://            regulations, and policies. To help
                                                 utilize the proposed criteria as a basis                www.epa.gov/dockets.                                  address potential environmental justice
                                                 for this rulemaking. EPA is therefore                   FOR FURTHER INFORMATION CONTACT:                      issues, the Agency seeks information on
                                                 withdrawing this proposal.                              Michael Goodis, Director, Registration                any groups or segments of the
                                                   3. Where can I get more information                   Division (RD) (7505P), Office of                      population who, as a result of their
                                                 about this action? The docket for this                  Pesticide Programs, Environmental                     location, cultural practices, or other
                                                 action is available under docket ID                     Protection Agency, 1200 Pennsylvania                  factors, may have atypical or
                                                 number OPP–300369. See also related                     Ave. NW, Washington, DC 20460–0001;                   disproportionately high and adverse
                                                 dockets identified by the docket ID                     main telephone number: (703) 305–                     human health impacts or environmental
                                                 numbers OPP–300370 and OPP–300371.                      7090; email address: RDFRNotices@                     effects from exposure to the pesticides
                                                   Authority: 7 U.S.C. 136 et seq., 21 U.S.C.            epa.gov.                                              discussed in this document, compared
                                                 346.                                                                                                          to the general population.
                                                                                                         SUPPLEMENTARY INFORMATION:
                                                   Dated: April 25, 2018.                                                                                      II. What Does this Correction Do?
                                                 Charlotte Bertrand,                                     I. General Information
                                                                                                                                                                  This notice is being issued to correct
                                                 Acting Principal Deputy Assistant                       A. Does this action apply to me?                      PP 7E8571. (EPA–HQ–OPP–2017–0291)
                                                 Administrator, Office of Chemical Safety and
                                                 Pollution Prevention.                                      You may be potentially affected by                 in FR Doc. 2017–19692, published in
                                                                                                         this action if you are an agricultural                the Federal Register of September 15,
                                                 [FR Doc. 2018–09206 Filed 5–4–18; 8:45 am]
                                                                                                         producer, food manufacturer, or                       2017 (82 FR 43352) (FRL–9965–43) is
                                                 BILLING CODE 6560–50–P
                                                                                                         pesticide manufacturer. The following                 corrected as follows:
                                                                                                         list of North American Industrial                        PP 7E8571. (EPA–HQ–OPP–2017–
                                                 ENVIRONMENTAL PROTECTION                                Classification System (NAICS) codes is                0291). Syngenta Crop Protection, LLC,
                                                 AGENCY                                                  not intended to be exhaustive, but rather             P.O. Box 18300, Greensboro, NC 27419,
                                                                                                         provides a guide to help readers                      requests to establish a tolerance in 40
                                                 40 CFR Part 180                                         determine whether this document                       CFR 180.226 for residues of the
                                                                                                         applies to them. Potentially affected                 herbicide, diquat (6,7-dihydrodipyrido
                                                 [EPA–HQ–OPP–2017–0291; FRL–9976–34]                     entities may include:                                 [1,2-a:2′1′-c] pyrazinediium), and its
                                                                                                            • Crop production (NAICS code 111).                metabolites in or on Crop Group 6C,
                                                 Receipt of a Pesticide Petition Filed for
                                                                                                            • Animal production (NAICS code                    dried shelled pea and bean (except
                                                 Residues of Diquat in or on Crop
                                                                                                         112).                                                 soybean) at 0.9 parts per million (ppm).
                                                 Group 6C, Dried Shelled Pea and Bean                       • Food manufacturing (NAICS code
                                                 (Except Soybean); Correction                                                                                  The Method GRM012.03A is used to
                                                                                                         311).                                                 measure and evaluate the chemical
                                                 AGENCY: Environmental Protection                           • Pesticide manufacturing (NAICS                   residues of diquat dibromide in
                                                 Agency (EPA).                                           code 32532).                                          commodities. Contact: RD.
                                                 ACTION: Notice; correction.                             B. What should I consider as I prepare                  Authority: 21 U.S.C. 346a.
                                                 SUMMARY:   EPA issued a notice in the                   my comments for EPA?                                    Dated: April 26, 2018.
                                                 Federal Register of September 15, 2017,                    1. Submitting CBI. Do not submit this              Michael Goodis,
                                                 announcing the initial filing of a                      information to EPA through                            Director, Registration Division, Office of
                                                 pesticide petition requesting the                       regulations.gov or email. Clearly mark                Pesticide Programs.
                                                 establishment or modification of                        the part or all of the information that               [FR Doc. 2018–09648 Filed 5–4–18; 8:45 am]
                                                 regulations for residues of pesticide                   you claim to be CBI. For CBI                          BILLING CODE 6560–50–P
                                                 chemicals in or on various commodities.                 information in a disk or CD–ROM that
                                                 DATES: Comments must be received on                     you mail to EPA, mark the outside of the
                                                 or before June 6, 2018.                                 disk or CD–ROM as CBI and then                        DEPARTMENT OF HEALTH AND
                                                 ADDRESSES: Submit your comments,                        identify electronically within the disk or            HUMAN SERVICES
                                                 identified by docket identification (ID)                CD–ROM the specific information that
                                                 number EPA–HQ–OPP–2017–0291, by                         is claimed as CBI. In addition to one                 42 CFR Part 10
                                                 one of the following methods:                           complete version of the comment that
                                                                                                                                                               RIN 0906–AB18
                                                   • Federal eRulemaking Portal: http://                 includes information claimed as CBI, a
                                                 www.regulations.gov. Follow the online                  copy of the comment that does not
                                                                                                                                                               340B Drug Pricing Program Ceiling
                                                 instructions for submitting comments.                   contain the information claimed as CBI
                                                                                                                                                               Price and Manufacturer Civil Monetary
                                                 Do not submit electronically any                        must be submitted for inclusion in the
                                                                                                                                                               Penalties Regulation
                                                 information you consider to be                          public docket. Information so marked
                                                 Confidential Business Information (CBI)                 will not be disclosed except in                       AGENCY:  Health Resources and Services
                                                 or other information whose disclosure is                accordance with procedures set forth in               Administration, HHS.
                                                 restricted by statute.                                  40 CFR part 2.                                        ACTION: Notice of proposed rulemaking;
                                                   • Mail: OPP Docket, Environmental                        2. Tips for preparing your comments.               further delay of effective date.
daltland on DSKBBV9HB2PROD with PROPOSALS




                                                 Protection Agency Docket Center (EPA/                   When preparing and submitting your
                                                 DC), (28221T), 1200 Pennsylvania Ave.                   comments, see the commenting tips at                  SUMMARY:  The Health Resources and
                                                 NW, Washington, DC 20460–0001.                          http://www.epa.gov/dockets/                           Services Administration (HRSA)
                                                   • Hand Delivery: To make special                      comments.html.                                        administers section 340B of the Public
                                                 arrangements for hand delivery or                          3. Environmental justice. EPA seeks to             Health Service Act, referred to as the
                                                 delivery of boxed information, please                   achieve environmental justice, the fair               ‘‘340B Drug Pricing Program’’ or the
                                                 follow the instructions at http://                      treatment and meaningful involvement                  ‘‘340B Program.’’ HHS is soliciting
                                                 www.epa.gov/dockets/contacts.html.                      of any group, including minority and/or               comments on further delaying the


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                                                                           Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Proposed Rules                                             20009

                                                 effective date of the January 5, 2017,                  2015). After review of the initial                    believes it would be counterproductive
                                                 final rule that sets forth the calculation              comments, HHS reopened the comment                    to effectuate the final rule prior to
                                                 of the ceiling price and application of                 period (81 FR 22960, April 19, 2016) to               issuance of additional or alternative
                                                 civil monetary penalties, and applies to                invite additional comments on the                     rulemaking on these issues. HHS is in
                                                 all drug manufacturers that are required                following areas of the NPRM: 340B                     the process of developing new
                                                 to make their drugs available to covered                ceiling price calculations that result in             comprehensive policies to address the
                                                 entities under the 340B Program. HHS                    a ceiling price that equals zero (penny               rising costs of prescription drugs. Those
                                                 proposes to further delay the effective                 pricing); the methodology that                        policies will address drug pricing in
                                                 date of the final rule published in the                 manufacturers use when estimating the                 government programs, such as Medicare
                                                 Federal Register from July 1, 2018, to                  ceiling price for a new covered                       Parts B & D, Medicaid, and the 340B
                                                 July 1, 2019. HHS proposes this action                  outpatient drug; and the definition of                discount drug program. Accordingly, we
                                                 to allow a more deliberate process of                   the ‘‘knowing and intentional’’ standard              are proposing to delay the effective date
                                                 considering alternative and                             to be applied when assessing a CMP for                of the final rule entitled ‘‘340B Drug
                                                 supplemental regulatory provisions and                  manufacturers that overcharge a covered               Pricing Ceiling Price and Manufacturer
                                                 to allow for sufficient time for                        entity.                                               Civil Monetary Penalties Regulation.’’
                                                 additional rulemaking.                                     On January 5, 2017, HHS published a                See 82 FR 1210 (Jan. 5, 2017).
                                                 DATES: Submit comments on or before                     final rule in the Federal Register (82 FR                This rule is currently scheduled to go
                                                 May 22, 2018.                                           1210, January 5, 2017); comments from                 into effect on July 1, 2018; we are
                                                 ADDRESSES: You may submit comments,                     both the original comment period                      proposing to delay further the effective
                                                 identified by the Regulatory Information                established in the NPRM and the                       date to July 1, 2019. We do not believe
                                                 Number (RIN) 0906–AB18, by any of the                   reopened comment period announced                     that this delay will adversely affect any
                                                 following methods. Please submit your                   in the April 19, 2016, notice were                    of the stakeholders in a meaningful way.
                                                 comments in only one of these ways to                   considered in the development of the                  The final rule implements both penny
                                                 minimize the receipt of duplicate                       final rule. The provisions of that final              pricing and a provision in the
                                                 submissions.                                            rule were to be effective March 6, 2017;              Affordable Care Act contemplating civil
                                                    • Federal eRulemaking Portal: http://                however, HHS issued a subsequent final                money penalties for those who fail to
                                                 www.regulations.gov. Follow                             rule (82 FR 12508, March 6, 2017)                     provide the proper 340B discounts to
                                                 instructions for submitting comments.                   delaying the effective date to March 21,              covered entities. The so-called penny
                                                 This is the preferred method for the                    2017, in accordance with a January 20,                pricing provision would allow
                                                 submission of comments.                                 2017, memorandum from the Assistant                   manufacturers to charge $0.01 for a drug
                                                    • Email: 340BCMPNPRM@hrsa.gov.                       to the President and Chief of Staff, titled           with when the ceiling price calculation
                                                 Include 0906–AB11in the subject line of                 ‘‘Regulatory Freeze Pending Review.’’ 1               results in a zero amount. As discussed
                                                 the message.                                               To provide affected parties sufficient             in the January 5, 2017 final rule, a small
                                                    • Mail: Office of Pharmacy Affairs                   time to make needed changes to                        number of manufacturers have informed
                                                 (OPA), Healthcare Systems Bureau                        facilitate compliance, and because                    HHS over the last several years that they
                                                 (HSB), Health Resources and Services                    questions were raised, HHS issued an                  charge more than $0.01 for a drug with
                                                 Administration (HRSA), 5600 Fishers                     interim final rule (82 FR 14332, March                a ceiling price below $0.01. However,
                                                 Lane, Mail Stop 08W05A, Rockville, MD                   20, 2017) to delay the effective date of              this is a long-standing HHS policy, and
                                                 20857.                                                  the final rule to May 22, 2017. HHS                   HHS believes the majority of
                                                    All comments submitted will be                       solicited additional comments on                      manufacturers currently follow the
                                                 available to the public in their entirety.              whether that date should be further                   practice of charging a $0.01. Therefore,
                                                 Please do not submit confidential                       extended to October 1, 2017. After                    the delay of this portion of the
                                                 commercial information or personally                    careful consideration of the comments                 regulation would not result in a
                                                 identifying information that you do not                 received, HHS delayed the effective date              significant economic impact.
                                                 want in the public domain.                              of the January 5, 2017, final rule to                    Delaying implementation of the 340B-
                                                 FOR FURTHER INFORMATION CONTACT:                        October 1, 2017 (82 FR 22893, May 19,                 specific CMPs should have no adverse
                                                 CAPT Krista Pedley, Director, OPA,                      2017).                                                effect given that other more significant
                                                 HSB, HRSA, 5600 Fishers Lane, Mail                         HHS later solicited comment on                     remedies are available to entities that
                                                 Stop 08W05A, Rockville, MD 20857, or                    delaying the effective date of the                    believe that they have not been
                                                 by telephone at 301–594–4353.                           January 5, 2017, final rule to July 1,                provided the full discount that they are
                                                                                                         2018 (82 FR 39553, August 21, 2017).                  entitled to receive under the program.
                                                 SUPPLEMENTARY INFORMATION:
                                                                                                         After consideration of the comments                   This proposed delay, though, will save
                                                 I. Background                                           received, HHS delayed the effective date              the healthcare sector compliance costs,
                                                    HHS published a notice of proposed                   of the January 5, 2017, final rule to July            as described in the January 5, 2017
                                                 rulemaking (NPRM) on June 17, 2015, to                  1, 2018 (82 FR 45511, September 29,                   issuance of the final rule.
                                                 implement civil monetary penalties                      2017).                                                   HHS believes that the proposed delay
                                                 (CMPs) for manufacturers that                           II. Proposal To Delay the Effective Date              would allow necessary time to consider
                                                 knowingly and intentionally charge a                    of the Final Rule                                     more fully the substantial questions of
                                                 covered entity more than the ceiling                                                                          fact, law, and policy identified by the
                                                                                                            HHS proposes to further delay the
                                                 price for a covered outpatient drug; to                                                                       Department during its review of the rule
                                                                                                         effective date of the January 5, 2017,
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                                                 provide clarity regarding the                                                                                 pursuant to the aforementioned
                                                                                                         final rule as HHS intends to engage in
                                                 requirement that manufacturers                                                                                ‘‘Regulatory Freeze Pending Review,’’
                                                                                                         additional or alternative rulemaking on
                                                 calculate the 340B ceiling price on a                                                                         memorandum. Requiring manufacturers
                                                                                                         these issues, and as discussed in more
                                                 quarterly basis; and to establish the                                                                         to make targeted and potentially costly
                                                                                                         detail on page 5, the Department
                                                 requirement that a manufacturer charge                                                                        changes to pricing systems and business
                                                 $.01 (penny pricing) for each unit of a                   1 See: https://www.whitehouse.gov/the-press-        procedures to comply with a rule that is
                                                 drug when the ceiling price calculation                 office/2017/01/20/memorandum-heads-executive-         under further consideration would be
                                                 equals zero (80 FR 34583, June 17,                      departments-and-agencies.                             disruptive.


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                                                 20010                     Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Proposed Rules

                                                    As background, the January 20, 2017,                 necessary, to select regulatory                       Fairness Act of 1996, which amended
                                                 Executive Order entitled, ‘‘Minimizing                  approaches that maximize net benefits                 the RFA, require HHS to analyze
                                                 the Economic Burden of the Patient                      (including potential economic,                        options for regulatory relief for small
                                                 Protection and Affordable Care Act                      environmental, public health and safety               businesses. If a rule has a significant
                                                 Pending Repeal,’’ specifically instructs                effects, distributive impacts, and                    economic effect on a substantial number
                                                 HHS and all other heads of executive                    equity). Executive Order 13563 is                     of small entities, the Secretary must
                                                 offices to utilize all authority and                    supplemental to and reaffirms the                     specifically consider the economic
                                                 discretion available to delay the                       principles, structures, and definitions               effect of the rule on small entities and
                                                 implementation of certain provisions or                 governing regulatory review as                        analyze regulatory options that could
                                                 requirements of the Patient Protection                  established in Executive Order 12866,                 lessen the impact of the rule. HHS will
                                                 and Affordable Care Act.2 The January                   emphasizing the importance of                         use an RFA threshold of at least a 3
                                                 5, 2017, final rule is based on changes                 quantifying both costs and benefits, of               percent impact on at least 5 percent of
                                                 made to the 340B Program by the                         reducing costs, of harmonizing rules,                 small entities.
                                                 Patient Protection and Affordable Care                  and of promoting flexibility. Section 3(f)               For purposes of the RFA, HHS
                                                 Act. HHS is proposing to further delay                  of Executive Order 12866 defines a                    considers all health care providers to be
                                                 the effective date of the January 5, 2017,              ‘‘significant regulatory action’’ as an               small entities either by meeting the
                                                 final rule to July 1, 2019, to more fully               action that is likely to result in a rule:            Small Business Administration (SBA)
                                                 consider the regulatory burdens that                    (1) Having an annual effect on the                    size standard for a small business, or by
                                                 may be posed by this final rule.                        economy of $100 million or more in any                being a nonprofit organization that is
                                                    At this time, HHS seeks public                       one year, or adversely and materially                 not dominant in its market. The current
                                                 comment regarding the impact of                         affecting a sector of the economy,                    SBA size standard for health care
                                                 delaying the effective date of the final                productivity, competition, jobs, the                  providers ranges from annual receipts of
                                                 rule, published January 5, 2017, for an                 environment, public health or safety, or              $7 million to $35.5 million. As of
                                                 additional 12 months from the current                   State, local, or Tribal governments or                January 1, 2018, over 12,800 covered
                                                 effective date of July 1, 2018, to Ju1y 1,              communities (also referred to as                      entities participate in the 340B Program,
                                                 2019, while a more deliberate                           ‘‘economically significant’’); (2) creating           representing safety-net health care
                                                 rulemaking process is undertaken. HHS                   a serious inconsistency or otherwise                  providers across the country. HHS has
                                                 is soliciting public comments for a                     interfering with an action taken or                   determined, and the Secretary certifies,
                                                 shortened 15-day period because parties                 planned by another agency; (3)                        that this proposed rule would not have
                                                 have had ample opportunity to                           materially altering the budgetary                     a significant impact on the operations of
                                                 comment on the two prior delays of the                  impacts of entitlement grants, user fees,             a substantial number of small
                                                 effective date of the underlying 340B                   or loan programs or the rights and                    manufacturers; therefore, we are not
                                                 regulation, and the impact of this delay                obligations of recipients thereof; or (4)
                                                                                                                                                               preparing an analysis of impact for this
                                                 on the regulated community is de                        raising novel legal or policy issues
                                                                                                                                                               RFA. HHS estimates that the economic
                                                 minimis. Given the prior opportunities                  arising out of legal mandates, the
                                                                                                                                                               impact on small entities and small
                                                 to comment on the underlying proposed                   President’s priorities, or the principles
                                                                                                                                                               manufacturers would be minimal. HHS
                                                 regulation and the delays, we do not                    set forth in the Executive Order. A
                                                                                                                                                               welcomes comments concerning the
                                                 envision receiving any novel comments.                  regulatory impact analysis must be
                                                                                                                                                               impact of this proposed rule on small
                                                 Moreover, we believe that the delay of                  prepared for major rules with
                                                                                                                                                               manufacturers.
                                                 the CMP authority can be issued                         economically significant effects ($100
                                                 without the opportunity for public                      million or more in any one year), and                 Unfunded Mandates Reform Act
                                                 comment because it delays the effective                 a ‘‘significant’’ regulatory action is
                                                                                                         subject to review by the Office of                      Section 202(a) of the Unfunded
                                                 date of a regulatory restriction. HHS                                                                         Mandates Reform Act of 1995 requires
                                                 encourages all stakeholders to provide                  Management and Budget (OMB).
                                                                                                            HHS does not believe that the                      that agencies prepare a written
                                                 comments on this proposed rule.                                                                               statement, which includes an
                                                                                                         proposal to further delay the effective
                                                 III. Regulatory Impact Analysis                         date of the January 5, 2017, final rule               assessment of anticipated costs and
                                                                                                         will have an economic impact of $100                  benefits, before proposing ‘‘any rule that
                                                    HHS has examined the effects of this
                                                                                                         million or more, and therefore, this                  includes any Federal mandate that may
                                                 proposed rule as required by Executive
                                                                                                         NPRM has not been designated as an                    result in the expenditure by State, local,
                                                 Order 12866 on Regulatory Planning
                                                                                                         ‘‘economically significant’’ proposed                 and Tribal governments, in the
                                                 and Review (September 30, 1993),
                                                                                                         rule under section 3(f)(1) of the                     aggregate, or by the private sector, of
                                                 Executive Order 13563 on Improving
                                                                                                         Executive Order 12866. The economic                   $100 million or more (adjusted annually
                                                 Regulation and Regulatory Review
                                                                                                         impact of having no rule in place related             for inflation) in any one year.’’ In 2017,
                                                 (January 8, 2011), the Regulatory
                                                                                                         to the policies addressed in the final                the threshold level was approximately
                                                 Flexibility Act (Pub. L. 96–354,
                                                                                                         rule is believed to be minimal.                       $148 million. HHS does not expect this
                                                 September 19, 1980), the Unfunded
                                                                                                            Executive Order 13771, entitled                    rule to exceed the threshold.
                                                 Mandates Reform Act of 1995 (Pub. L.
                                                 104–4), and Executive Order 13132 on                    Reducing Regulation and Controlling                   Executive Order 13132—Federalism
                                                 Federalism (August 4, 1999).                            Regulatory Costs, was issued on January
                                                                                                         30, 2017. This action’s designation as                   HHS has reviewed this proposed rule
                                                 Executive Orders 12866, 13563, and                      regulatory or deregulatory will be                    in accordance with Executive Order
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                                                 13771                                                   discussed in the final rule and be                    13132 regarding federalism, and has
                                                    Executive Orders 12866 and 13563                     informed by comments received in                      determined that it does not have
                                                 direct agencies to assess all costs and                 response to this proposed rule.                       ‘‘federalism implications.’’ This
                                                 benefits of available regulatory                                                                              proposed rule would not ‘‘have
                                                                                                         The Regulatory Flexibility Act (RFA)                  substantial direct effects on the States,
                                                 alternatives and, if regulation is
                                                                                                           The Regulatory Flexibility Act (5                   or on the relationship between the
                                                   2 See: https://www.gpo.gov/fdsys/pkg/FR-2017-01-      U.S.C. 601 et seq.) (RFA) and the Small               national government and the States, or
                                                 24/pdf/2017-01799.pdf.                                  Business Regulatory Enforcement and                   on the distribution of power and


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                                                                           Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Proposed Rules                                             20011

                                                 responsibilities among the various                      DATES:  Submit comments on or before                  comments and reply comments on or
                                                 levels of government.’’                                 July 6, 2018. Submit reply comments                   before the dates indicated on the first
                                                                                                         August 6, 2018.                                       page of this document. Comments may
                                                 Paperwork Reduction Act
                                                                                                         ADDRESSES: You may submit comments,                   be filed using the Commission’s
                                                   The Paperwork Reduction Act of 1995                   identified by WP Docket No. 07–100 by                 Electronic Comment Filing System
                                                 (44 U.S.C. 3507(d)) requires that OMB                   any of the following methods:                         (ECFS). See Electronic Filing of
                                                 approve all collections of information                    • Federal Communications                            Documents in Rulemaking Proceedings,
                                                 by a federal agency from the public                     Commission’s website: http://                         63 FR 24121, May 1 (1998).
                                                 before they can be implemented. This                    apps.fcc.gov/ecfs/. Follow the                           • Electronic Filers: Comments may be
                                                 proposed rule is projected to have no                   instructions for submitting comments.                 filed electronically using the internet by
                                                 impact on current reporting and                           • Mail: U.S. Postal Service first-class,            accessing the ECFS: http://apps.fcc.gov/
                                                 recordkeeping burden for manufacturers                  Express, and Priority mail must be                    ecfs/.
                                                 under the 340B Program. This proposed                   addressed to 445 12th Street SW,                         • Paper Filers: Parties who choose to
                                                 rule would result in no new reporting                   Washington, DC 20554. Commercial                      file by paper must file an original and
                                                 burdens. Comments are welcome on the                    overnight mail (other than U.S. Postal                one copy of each filing. If more than one
                                                 accuracy of this statement.                             Service Express Mail and Priority Mail)               docket or rulemaking number appears in
                                                   Dated: May 1, 2018.                                   must be sent to 9050 Junction Drive,                  the caption of this proceeding, filers
                                                                                                         Annapolis Junction, MD 20701.                         must submit two additional copies for
                                                 George Sigounas,
                                                                                                           • Hand or Messenger Delivery: 445                   each additional docket or rulemaking
                                                 Administrator, Health Resources and Services                                                                  number.
                                                 Administration.                                         12th St., SW, Room TW–A325,
                                                                                                         Washington, DC 20554.                                    Filings can be sent by hand or
                                                   Approved: May 2, 2018.                                                                                      messenger delivery, by commercial
                                                                                                           • People with Disabilities: Contact the
                                                 Alex M. Azar II,                                                                                              overnight courier, or by first-class or
                                                                                                         FCC to request reasonable
                                                 Secretary, Department of Health and Human                                                                     overnight U.S. Postal Service mail. All
                                                                                                         accommodations (accessible format
                                                 Services.                                                                                                     filings must be addressed to the
                                                                                                         documents, sign language interpreters,
                                                 [FR Doc. 2018–09711 Filed 5–4–18; 8:45 am]
                                                                                                         CART, etc.) by email: FCC504@fcc.gov                  Commission’s Secretary, Office of the
                                                 BILLING CODE 4165–15–P
                                                                                                         or phone: 202–418–0530 or TTY: 202–                   Secretary, Federal Communications
                                                                                                         418–0432.                                             Commission.
                                                                                                           For detailed instructions for                          • All hand-delivered or messenger-
                                                                                                         submitting comments and additional                    delivered paper filings for the
                                                 FEDERAL COMMUNICATIONS                                                                                        Commission’s Secretary must be
                                                 COMMISSION                                              information on the rulemaking process,
                                                                                                         see the SUPPLEMENTARY INFORMATION                     delivered to FCC Headquarters at 445
                                                 47 CFR Parts 0, 2, 90                                   section of this document.                             12th St., SW, Room TW–A325,
                                                                                                                                                               Washington, DC 20554. The filing hours
                                                                                                         FOR FURTHER INFORMATION CONTACT:
                                                 [WP Docket No. 07–100; FCC 18–33]                                                                             are 8:00 a.m. to 7:00 p.m. All hand
                                                                                                         Thomas Eng, Policy and Licensing
                                                                                                                                                               deliveries must be held together with
                                                                                                         Division, Public Safety and Homeland
                                                 4.9 GHz Band                                                                                                  rubber bands or fasteners. Any
                                                                                                         Security Bureau, Federal
                                                                                                                                                               envelopes and boxes must be disposed
                                                 AGENCY:  Federal Communications                         Communications Commission, 445 12th
                                                                                                                                                               of before entering the building.
                                                 Commission.                                             Street SW, Washington, DC 20554, at                      • Commercial overnight mail (other
                                                 ACTION: Proposed rule.                                  (202) 418–0019, TTY (202) 418–7233, or                than U.S. Postal Service Express Mail
                                                                                                         via email at Thomas.Eng@fcc.gov.                      and Priority Mail) must be sent to 9050
                                                 SUMMARY:    In 2002, the Commission                     SUPPLEMENTARY INFORMATION: This is a                  Junction Drive, Annapolis Junction, MD
                                                 allocated the 4940–4990 MHz (4.9 GHz)                   summary of the Commission’s Sixth                     20701.
                                                 band for fixed and mobile use and                       Further Notice of Proposed Rulemaking                    • U.S. Postal Service first-class,
                                                 designated the band for public safety                   (Sixth FNPRM) in WP Docket No. 07–                    Express, and Priority mail must be
                                                 broadband communications. Since then,                   100, adopted on March 22, 2018 and                    addressed to 445 12th Street, SW,
                                                 the band has experienced relatively                     released as FCC 18–33 on March 23,                    Washington DC 20554.
                                                 light usage compared to the heavy use                   2018. The complete text of this
                                                 of other public safety bands. In this                   document is available for inspection                  Introduction
                                                 document, the Commission proposes                       and copying during normal business                       The Commission has allocated and
                                                 several rule changes and seeks comment                  hours in the FCC Reference Information                designated 50 megahertz of spectrum in
                                                 on alternatives with the goal of                        Center, Portals II, 445 12th Street SW,               the 4.9 GHz band (4940–4990 MHz) to
                                                 promoting increased public safety use of                Room CY–A257, Washington, DC 20554.                   public safety. Although nearly 90,000
                                                 the band while opening up the spectrum                  Alternative formats (computer diskette,               public safety entities are eligible under
                                                 to additional uses that will encourage a                large print, audio cassette, and Braille)             our rules to obtain licenses in the band,
                                                 more robust market for equipment and                    are available to persons with disabilities            there were only 2,442 licenses in use in
                                                 greater innovation. The Commission                      or by sending an email to FCC504@                     2012 and only 3,174 licenses in use
                                                 proposes rules on channel aggregation,                  fcc.gov or calling the Consumer and                   nearly six years later in 2018. With no
                                                 aeronautical mobile use, frequency                      Governmental Affairs Bureau at (202)                  more than 3.5% of potential licensees
                                                 coordination, site-based licensing,                     418–0530, TTY (202) 418–0432. This                    using the band, we remain concerned
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                                                 regional planning, and technical rule                   document is also available on the                     that, as the Commission stated in 2012,
                                                 changes with the goal of promoting                      Commission’s website at http://                       the band has ‘‘fallen short of its
                                                 increased use of the band. The                          www.fcc.gov.                                          potential.’’
                                                 Commission seeks comment on                                                                                      Public safety entities have offered
                                                 alternatives such as expanding                          Comments                                              several reasons why the band has seen
                                                 eligibility, spectrum leasing, sharing,                   Pursuant to §§ 1.415 and 1.419 of the               less use than expected. One reason cited
                                                 and redesignating the band for                          Commission’s rules, 47 CFR 1.415,                     is the difficulty of acquiring equipment
                                                 commercial use.                                         1.419, interested parties may file                    and the cost of deployment. According


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Document Created: 2018-05-05 02:48:28
Document Modified: 2018-05-05 02:48:28
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionProposed Rules
ActionNotice of proposed rulemaking; further delay of effective date.
DatesSubmit comments on or before May 22, 2018.
ContactCAPT Krista Pedley, Director, OPA, HSB, HRSA, 5600 Fishers Lane, Mail Stop 08W05A, Rockville, MD 20857, or by telephone at 301-594-4353.
FR Citation83 FR 20008 
RIN Number0906-AB18

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