Life Science Compliance Update

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April 14, 2017

340B and You: Thoughts on Program Oversight for Pharmaceutical Manufacturers

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The 340B Drug Discount Program plays an important role in the United States healthcare system by providing healthcare services primarily to entities that serve low-income populations. The program also is complex and evolving, so compliance challenges will abound for years to come. This article examines those complexities and compliance challenges.

The 340B Drug Discount Program plays an important role in the United States healthcare system by providing healthcare services primarily to Disproportionate Share Hospitals (“DSH”), outpatient clinics associated with DSHs, and other entities that serve low-income populations. According to the Government Accountability Office (“GAO”), the program accounts for an estimated 2% of medicines purchased in the United States, approximately $6 billion annually. The 340B Drug Discount Program is a U.S. federal government program created under the Veterans Health Care Act of 1992 (“VHCA”) and administered by the Office of Pharmacy Affairs (OPA) within the Health Resources and Services Administration (“HRSA”). According to the HRSA website:

The 340B Program enables covered entities to stretch scarce Federal resources as far as possible, reaching more eligible patients and providing more comprehensive services...

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