340B Health


What is 340B?

Section 340B of the U.S. Public Health Service Act provides that drug manufacturers that choose to participate in Medicare and Medicaid sell certain outpatient drugs to eligible safety-net providers at a discount. These providers then use the savings to “stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.” Learn more about 340B.

Drug Manufacturers Are Refusing to Provide Required 340B Discounts

Five major drug manufacturers – Eli Lilly, AstraZeneca, Sanofi, Novo Nordisk, Novartis, and United Therapeutics – unilaterally have stopped providing required 340B discounts when drugs are dispensed at community pharmacies. 

These actions are in violation of the 340B statute, which states that manufacturers “must provide” 340B pricing on any eligible drug to any eligible covered entity regardless of how the hospital intends to dispense the drug.

About 25% of 340B discounts for safety-net hospitals come through these partnerships. This figure is more than 50% for rural hospitals.

Without access to 340B discounts, millions of patients are at risk of losing access to a wide range of services they rely on to stay healthy.

We urge the U.S. Department of Health and Human Services to use its authority to stop these harmful actions and protect patients and the providers who care for them. 

Six national organizations representing hospitals and pharmacists, along with three 340B hospitals, filed a joint lawsuit demanding prompt action to stop drug companies that are refusing to provide 340B discounts for covered drugs dispensed at community pharmacies. Read the legal complaint. A federal court on Feb. 18 granted the government’s motion to dismiss the lawsuit on procedural grounds but left the door open for the plaintiffs to refile the lawsuit in the future seeking HHS enforcement of the statute. Read our statement on the court’s decision. 

On Dec. 30, 2020, the Office of the HHS General Counsel released an advisory opinion stating that drug manufacturers are obligated to provide 340B pricing to covered entities on drugs dispensed at community-based pharmacies. Read our statement about the advisory opinion.


Stories of How 340B Hospitals Use Community-based Pharmacy Partnerships to Benefit Patients 


  • Read a letter from six national organizations representing hospitals and pharmacists urging HHS to order six drug companies to restore 340B discounts and impose civil monetary penalties. 
  • Read a letter from seven national organizations to HHS.  
  • Read a letter from more than 1,100 safety-net hospitals participating in 340B to HHS. 
  • Read a letter from a bipartisan group of 28 U.S. senators to HHS. 
  • Read a letter from a bipartisan group of more than half of the members of the U.S. House of Representatives to HHS.   
  • Read a letter from more than 60 advocacy groups for patients and social justice to HHS. 
  • Read a letter from a bipartisan group of 29 state attorneys general to HHS.
  • Read how Eli Lilly reaped a 22% revenue increase in the fourth quarter of 2020, partially by refusing 340B discounts to safety-net hospitals.