How the 340B hospital markup program and PBMs drive up costs for US patients

Government price setting policies like Most Favored Nation are a bad deal for American patients. The “Foreign First Pricing” scheme won’t lower out-of-pocket costs for American patients because it fails to address one of the real reasons patients in the USA are paying more, according to Molly Jenkins, director of public affairs at lobby group Pharmaceutical Research and Manufacturers of America (PhRMA).

Why? Because in the US entities that don’t make medicine, like pharmacy benefits managers (PBMs) and 340B hospitals, use medicine spending to subsidize other parts of their business at the expense of patients, taxpayers and employers.

The 340B program allows hospitals and clinics to buy medicines at steep discounts and charge patients whatever they want, with the expectation that savings will help uninsured and low-income patients afford the care they need.