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The 340B Drug Pricing Program was created in 1992 to help
struggling, uninsured or otherwise vulnerable patients access
more affordable medications. Under the program, drug
manufacturers provide discounted medications to qualifying
hospitals and clinics.
The group Alliance for Integrity and Reform 340B found that some
hospitals are keeping the discounts for their own profit, and
today’s 340B program has morphed into a massive profit generator
for pharmacy chains, hospitals and middlemen like pharmacy
benefit managers.
AIR340B spokesperson Nicole Longo said there needs to be changes
to the program.
“We think that if the hospitals are buying medicine at a
discount, then low-income patients should have access as well to
that discount, and finally, there needs to be clearer rules
about hospitals and how they qualify for the program,” said
Longo.
AIR340B found that hospitals made 87% of purchases under 340B in
2022, but they are not required to report their 340B profits or
how the revenue is used to lower costs for patients. They also
found that Illinois 340B hospitals earn in excess of 2.5 times
more in 340B profits than is spent on charity care, while 69% of
Illinois 340B hospitals provide below-average levels of charity
care.
The report shows that only 37% of Illinois hospitals reviewed
are compliant with drug price transparency.
They also found that 340B hospitals in Illinois have 4,287
contracts with 340B pharmacies, 19% with out-of-state
pharmacies.
In May, U.S. House Energy and Commerce Committee Chair Cathy
McMorris Rodgers, R-Washington, and Subcommittee on Oversight
and Investigations Chair Morgan Griffith, R-Virginia, announced
a subcommittee hearing titled “Oversight of 340B Drug Pricing
Program.”
"It’s important that we preserve patients’ access to important
and live-saving drugs. We must explore how the 340B program is
working to ensure it aligns with how the program was intended to
function,” said Chairs Rodgers and Griffith.
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