Federally fueled hospital drug sales must be reformed

The Senate Health, Education, Labor, and Pensions Committee held a hearing last month examining the 340B drug discount program. A recurring line of questioning centered on whether 340B assistance is actually going to those most in need. At the University of Southern California Schaeffer Center for Health Policy & Economics, we recently uncovered how the 340B drug discount program, a well-intentioned initiative, has morphed into a revenue engine for well-heeled hospitals that exacerbates inequality, inflates costs, and distorts the market for pharmaceuticals.

The program, enacted in 1992, mandates that drug manufacturers offer steep discounts to eligible hospitals and clinics. By last year, it had grown to cover 3,300 hospitals, generating $66 billion in discounted purchases.

Re