Buying Ineligible Drugs for 340B Savings
The Ineligible Drugs for 340B Savings requires pharmaceutical manufacturers to sell certain drugs at discounted prices to safety-net healthcare providers like clinics and hospitals that serve low-income patients. These 340B “covered entities” can purchase orphan drugs at a discounted rate, as well as certain generic and brand-name medications at a lower price, if the drug meets specific criteria (such as the drug must have an approved therapeutic use).
The goal of the program is to help safety-net healthcare providers treat uninsured and low-income patients. But many hospitals have found a way to treat the discount program less as a charity and more as a revenue stream. By obtaining expensive drugs at the 340B discounted price, and then charging private insurers, including Medicare and Medicaid, the full list price, a hospital can make a profit.
Navigating 340B Compliance: Understanding Ineligible Drugs and Savings Exclusions
This 340B pricing scheme has been a point of contention between covered entities and pharmaceutical manufacturers. Drugmakers argue that 340B discounts are not being used for the intended purposes and are instead creating additional profits for hospitals. To combat these concerns, some drugmakers have begun limiting the number of contract pharmacies that a hospital may use to receive the discount or require patient claim data for 340B purchases.
IQVIA believes that the 340B program should be strengthened to ensure that it is used as intended. Ultimately, this will benefit both the patients that receive care at these covered entities and the manufacturers who produce the life-saving medications.
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