Michelle Nyman, deputy vice president of advocacy and strategic alliances at PhRMA, said on May 14 that the 340B Drug Pricing Program has expanded into the second-largest federal drug program while allowing hospitals to buy medicines at steep discounts, mark them up, and retain the difference with limited transparency or accountability.
“340B has grown into the second-largest federal drug program, yet hospitals can buy medicines at deep discounts, mark them up, and keep the profits with little transparency or accountability. It’s time to ensure 340B actually helps patients,” Nyman said on social media.
Discounted purchases under the 340B program reached $66.3 billion in 2023, a 23.4% increase from 2022, according to IQVIA. Hospitals accounted for the majority of purchases, with spending concentrated in areas such as oncology, immunology, diabetes, and HIV treatments, reflecting continued program growth.
The 340B program requires drug manufacturers to sell outpatient drugs at discounted prices to eligible safety-net hospitals and clinics. It was designed to help providers serving low-income and uninsured patients stretch limited resources, but it does not require that discounts be passed directly to patients or that savings be used for specific services. Some policy research has raised concerns about transparency, rapid program growth, contract pharmacy expansion, and whether savings consistently translate into measurable patient benefits, according to JAMA Health Forum.
Federal oversight of the program has also been questioned.
The U.S. Government Accountability Office has found that audits do not fully verify safeguards against duplicate discounts, that audit closure processes may not ensure full correction of noncompliance, and that oversight does not fully guarantee eligibility requirements are met.
At an October 2025 Senate Health Education Labor & Pensions (HELP) Committee hearing, Chairman Bill Cassidy said the 340B program had "ballooned with limited oversight," raising questions about how revenue is used and whether it directly benefits low-income patients. Cassidy said growth is tied to higher health care costs and pointed out concerns involving contract pharmacies, hospital consolidation, duplicate discounts, and weak transparency requirements.
Michelle Nyman is Deputy Vice President of Advocacy & Strategic Alliances at PhRMA, where her work centers on stakeholder engagement, public affairs, and policy advocacy related to patient access, medical innovation, and biopharmaceutical policy. Her public commentary has focused on the 340B Drug Pricing Program, drug costs, and health care access.
