Adam Fein, President of Drug Channels Institute, said that the 340B drug discount program has evolved from a safety-net support tool to a lucrative revenue source for healthcare entities. This statement was made on Drug Channels.
“The 340B program has morphed from a safety-net mechanism into a high-margin revenue stream for hospitals, pharmacies, and their corporate cousins,” said Fein.
According to the Government Accountability Office, the 340B Drug Pricing Program was established in 1992 to assist hospitals and clinics serving low-income patients by providing medications at discounted prices. Over time, concerns have emerged regarding insufficient oversight and whether savings are consistently passed on to patients. In recent years, both lawmakers and watchdog groups have advocated for increased transparency in the utilization of 340B funds.
The Health Resources and Services Administration (HRSA) reported that purchases by 340B-covered entities amounted to $38 billion in 2020. This figure marks a significant increase from $12 billion in 2015, representing more than a 200% growth over five years. HRSA releases these data to offer transparency into the scale and financial impact of the program.
According to Citizen Portal, Georgia’s House Bill 690 was introduced to address concerns that Pharmacy Benefit Managers’ (PBMs) non-transparent practices contribute to rising drug prices. Proponents argue that the bill is necessary to protect consumers by increasing regulation of PBMs. The legislation aims to enhance transparency and reduce medication costs.
Fein has served as President of Drug Channels Institute since March 2012, focusing on pharmaceutical economics and supply chain analysis. In January 2024, Drug Channels Institute was acquired by HMP Global, expanding the institute’s influence in the healthcare insights and education sector. Fein continues to lead the organization from its headquarters in Philadelphia, Pennsylvania.
