Molly Jenkins, Director of Public Affairs at the Pharmaceutical Research and Manufacturers of America (PhRMA), said that the 340B program has expanded beyond its initial intent and now functions as a revenue source for hospitals and pharmacy stakeholders. This assertion was made in a blog post.
“340B was originally intended to help less than 100 safety net hospitals with a safety net mission, but today it’s a $64 billion revenue stream to more than half of all hospitals, clinics, and a profit center for PBMs and chain pharmacies,” said Jenkins.
According to the Association of American Medical Colleges (AAMC), the 340B Drug Pricing Program was established in 1992 to assist safety-net providers in extending limited federal resources while continuing to serve vulnerable communities. Initially, the program applied to a restricted number of entities but has since experienced significant growth. The AAMC notes that this expansion has led to discussions about oversight and alignment with the program’s original mission.
The U.S. Government Accountability Office (GAO) reported an increase in covered entities within the 340B program from approximately 8,100 in 2000 to over 50,000 by 2020. This includes a wide range of hospitals and contract pharmacies. The report raised questions regarding whether all participants are upholding the program’s original safety-net purpose.
PhRMA indicated that in New York, 113 hospitals participate in the 340B program, maintaining over 6,000 contracts with pharmacies nationwide. However, only 24% of these contract pharmacies are situated in medically underserved areas, and 86% of participating hospitals provide below-average levels of charity care. This discrepancy has prompted concerns about the program’s effectiveness in reaching its intended beneficiaries within the state.
Jenkins serves as Director of Public Affairs at PhRMA, concentrating on communication strategies related to healthcare cost and value. She previously worked in issue advocacy and held communication roles with Representative Greg Walden and the House Energy and Commerce Committee. Jenkins holds a Master’s degree in Health Communication from Johns Hopkins University.
