WASHINGTON, D.C.—Democracy Forward filed suit against the Office of Management and Budget (OMB) demanding the agency disclose the role Joseph Grogan, a former pharma lobbyist appointed by President Trump, played in the Administration’s decision to delay a pharmaceutical anti-price gouging rule mandated by the Affordable Care Act (ACA). The delay eliminates protections to prevent pharma companies from unlawfully overcharging for life-saving drugs used by millions of Americans under the 340B drug discount program.
The new filing follows President Trump’s latest Executive Order to sabotage the ACA and the Administration’s fourth delay of the anti-price gouging rule, which imposes civil monetary penalties on drug manufacturers that knowingly overcharge black lung clinics, rural health centers, children’s hospitals, and other public health providers who participate in the 340B drug discount program. After a seven-year rulemaking process, the rule was set to take effect until the Trump Administration’s first delay on March 6, 2017—the very same week President Trump appointed Grogan to run the White House’s pharma policy.
“With a former pharma lobbyist driving the Administration’s drug pricing agenda, it’s no surprise that President Trump has abandoned his campaign pledge to protect Americans from exploitive pricing for critical medications,” said Democracy Forward Executive Director Anne Harkavy. “By allowing pharma to re-write their own rules, the Trump Administration is making it easier for drug makers to reap illegal profits by overcharging for life-saving drugs, setting the stage for another EpiPen price-gouging disaster.”
In March 2017, Grogan was appointed OMB Associate Director of Health Programs immediately after serving as chief lobbyist for Gilead Sciences, a pharma company previously investigated by Congress for price-gouging veterans. Despite personally lobbying on issues concerning the 340B program as recently as March 2017, Grogan now leads President Trump’s “Drug Pricing and Innovation Working Group,” which held regular White House meetings with pharma executives during the summer to discuss, among other things, rolling back accountability provisions of the 340B program. Despite this clear conflict of interest, Grogan neither recused himself from the issue nor, according to reports, signed an ethics waiver—in violation of President Trump’s Executive Order 13770.
Democracy Forward filed a Freedom of Information Act request in June seeking to uncover the role Grogan has played in delaying the anti-price gouging rule, and the extent to which pharma executives have influenced the Trump Administration’s policies on other critical patient protections. OMB has failed to produce documents responding to the request.
The suit was filed in U.S. District Court for the District of Columbia.
For more information on the 340B program, see the NowThis News video primer.
Democracy Forward is a nonprofit legal organization that scrutinizes Executive Branch activity across policy areas, represents clients in litigation to challenge unlawful actions, and educates the public when the White House or federal agencies break the law.
December 7, 2018