Lori M. Reilly, Chief Operating Officer of the Pharmaceutical Research and Manufacturers of America (PhRMA), said that the 340B Drug Pricing Program is contributing to increased costs. She cited a study by the Berkeley Research Group indicating $6.5 billion in lost Medicaid rebates in 2024 alone. The statement was made on X, a social media platform.
"The 340B program is driving up costs for patients," said M. Reilly. "A new study from the Berkeley Research group shows how the program is also increasing Medicaid costs with $6.5B in lost rebates in 2024 alone. That's a hidden tax on patients, taxpayers & employers."
The 340B Drug Pricing Program, established by Congress in 1992, mandates drug manufacturers to offer outpatient medications at significantly reduced prices to eligible hospitals and clinics serving low-income populations. Its objective is to help these entities stretch limited federal resources to reach more vulnerable patients and expand services.
According to a 2025 report by the Berkeley Research Group, the program resulted in an estimated $6.5 billion loss in Medicaid drug rebates for 2024. The analysis identified duplicate discounts—where both a 340B discount and a Medicaid rebate apply to the same drug—as a primary cause of this rebate loss, affecting both federal and state Medicaid budgets.
Fierce Healthcare reported in July 2025 that out of the $6.5 billion lost due to the 340B program, approximately $4.2 billion would have been allocated to the federal government and $2.3 billion to state programs. This analysis was based on a report commissioned by PhRMA and conducted by the Berkeley Research Group.
Reilly oversees PhRMA's advocacy efforts, including federal, state, and international government affairs. Before her current role, she served as executive vice president of policy, research, and membership at PhRMA. She was recognized as a top lobbyist by The Hill in both 2018 and 2019.
