A federal judge in the U.S. District Court for the District of Maine granted a temporary restraining order (TRO) blocking the Department of Health and Human Services from moving forward with its 340B Rebate Model Pilot Program, which was scheduled to begin on January 1, 2026. The order preserves the current purchasing structure and process of the 340B program while the court considers a legal challenge brought by hospital and healthcare association plaintiffs, who argue that the program represents an unlawful restructuring of the long-standing 340B Drug Pricing Program.

In granting the TRO, the court found that the plaintiffs raised serious questions about whether HHS exceeded its statutory authority and violated the Administrative Procedure Act by mandating a rebate-based system in place of upfront discounts. The court also credited arguments that implementation of the pilot would impose immediate and significant administrative and financial burdens on 340B covered entities, constituting irreparable harm absent judicial relief. The TRO prevents HHS from implementing or enforcing the pilot program pending further proceedings in the case.

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Why This Matters:

A federal court has temporarily stopped the launch of the 340B Rebate Model Pilot Program: The court’s order prevents an immediate shift to a rebate-based system that could have increased cash-flow strain, administrative complexity, and compliance risk while the legality of the program is unresolved.