The Centers for Medicare & Medicaid Services (CMS) proposed another round of cuts to Medicare payment rates for 340B drugs, aiming to update reimbursement to better reflect what hospitals actually pay for outpatient drugs. CMS said the approach would resurrect a policy concept struck down by the U.S. Supreme Court in 2021. The proposal comes as hospitals and provider groups warn that changes could push payments into negative territory for some institutions, particularly those relying on 340B for access and contract pricing. CMS framed the rule as a mechanism to align reimbursement with acquisition costs. For biotech manufacturers and distributors, 340B-related policy is a direct lever affecting demand patterns, pricing negotiations, and the downstream economic viability of hospital-administered therapies. The next phase will hinge on public comment and how CMS ultimately finalizes any rate adjustments.