The U.S. Centers for Medicare & Medicaid Services proposed additional cuts to hospital reimbursement rates for drugs purchased under the 340B program, reviving a reimbursement rule framework previously rejected by the Supreme Court in 2021. CMS said the rule would reduce Medicare payment rates by more than a third, tying the change to what hospitals actually pay for outpatient drugs. CMS’ latest move comes as hospitals and provider groups warn that the revised rates could push some payments into negative territory. The proposal is also notable for reigniting a long-running policy fight that affects large parts of the provider ecosystem and drug access economics. For biotech and life sciences firms, the shift could influence 340B-related purchasing dynamics, contract pricing, and how hospitals manage formularies—particularly for high-cost medicines commonly dispensed through 340B channels.