Pharmacy Benefit Managers AND Contract Pharmacies Place Profits over Patients
PBMs and giant for-profit pharmacy chains control the vast majority of contract pharmacies in the 340B program.
Walgreens, CVS, Walmart, UnitedHealth (OptumRX) and Cigna (Express Scripts) control more than 75% of contract pharmacy relationships.
PBMs and 340B contract pharmacies earn massive profits from discounted medicines.
Profit margins for contract pharmacies dispensing 340B drugs are over three times higher than those of independent pharmacies dispensing non-340B drugs.
PBMs and 340B contract pharmacies are not sharing discounts with low-income, vulnerable patients.
The Government Accountability Office found that less than half of the 340B hospitals surveyed provided discounts to low-income, uninsured patients at some or all of their contract pharmacies. This is the third government report to draw the same conclusion.
Seeing Profits, Contract Pharmacies Are Surging
But Contract Pharmacies Don’t Serve Vulnerable Communities
- Just 23% of contract pharmacies are in medically underserved areas, and that figure has gotten worse in recent years.
- Research shows new contract pharmacies are clustered in “affluent and predominantly white” areas.
340B Should Serve Patients
- We must hold PBMs, for-profit pharmacies and 340B hospitals accountable to ensure patients do not continue to suffer for the sake of corporate profits.
- With commonsense guardrails – like requiring pharmacies to submit claims data showing how 340B discounts are used – we can reduce the outsized role of for-profit pharmacies in the 340B system.
“The commercially insured patient is responsible for one-third of the total profit earned by the 340B hospital and the contract pharmacy… If the patient had a high deductible plan, then 100% of the 340B savings would come from the patient.”
“…hospital networks are happy to use their branches in poor areas to get 340B drugs into the pipeline, but then re-route these medicines throughout the hospital network to be sold at full price to patients of all income levels.”
Former Congressman Ed Towns & Former NAACP Executive Director Dr. Ben Chavis
By The Numbers
340B Contract Pharmacy Locations: 2010 - 2023
No Data Found
340B Contract Pharmacy Locations: 2010 - 2023
No Data Found
Sources: Government Accountability Office (2010-2012); Drug Channels Institute analysis of OPA Daily Contract Pharmacy Database (2013-2022). Data shows number of unique contract pharmacy locations as of January (GAO) or June/July (DCI).
Published on Drug Channels (www.DrugChannels.net) on July 11, 2023
340B Contract Pharmacy Relationships By Company, 2023
(U.S. TOTAL = 194K)
No Data Found
340B Contract Pharmacy Relationships By Company, 2023
(U.S. TOTAL = 194K)
No Data Found
Source: Drug Channels Institute analysis of Contract Pharmacy Daily Report, Office of Pharmacy Affairs, Health Resources & Services Administration. As of July 1, 2023, there were 33,043 unique locations acting as 340B contract pharmacies (CP) for 9,585 340B covered entities (CE). There were 195,016 total CP/CE contractual relationships. The five companies shown above operated 20,313 unique 340B contract pharmacy locations for 5,726 340B covered entities. These companies accounted for 146.336 (75.4%) of the total CP/CE contractual relationships. Company totals are computed from combined banners (store and business names) and subsidiaries in the database.
Published on Drug Channels (www.DrugChannels.net) on July 11, 2023
