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- The 340B Program: Missing the mark for patients
The 340B Drug Pricing Program was designed to help eligible safety-net healthcare providers provide access to more affordable medicines for low-income and vulnerable patients. Unfortunately, patients today are not directly benefiting from the program amidst widespread abuse and misuse. Growing 340B profits are extracted by large health systems, contract pharmacies and pharmacy benefit managers (PBMs).
Lack of transparency and accountability fuels abuse
The 340B Program operates with little oversight, making it difficult to track whether billions of dollars in 340B discounts are reaching the patients the program originally intended to help. Instead, large hospital systems, contract pharmacies and PBMs have taken advantage of loopholes in the program, including a lack of reporting requirements on whether 340B discounts are shared with patients.
The 340B Program has grown rapidly
In 2024, J&J Innovative Medicine provided $7.4 billion in rebates and discounts to 340B covered entities and DSH hospitals. This indicates a growing amount of money is going to middlemen, rather than being invested in the next breakthrough medicine.1
Discounted purchases through the 340B Program reached $147.8 billion in 2024 at list price, growing at more than three times the rate of non-340B sales between January 2018 and December 2024.2
Rapid growth has led to exploding profits
The 340B Program has grown exponentially to become the nation’s second-largest federal prescription drug program, behind only Medicare Part D.3
In 2013, 340B generated about $3.5 billion in profits for hospitals and PBMs.4 A decade later, that figure had soared to $64.4 billion.4
In 2013, 340B generated about $3.5 billion in profits for hospitals and PBMs.4 A decade later, that figure had soared to $64.4 billion.4
Provider margins have likely climbed
even higher amid continued expansion
of contract pharmacy dispensing and hospital participation.5
But patients — including the most vulnerable — aren’t benefiting
A recent study found that only 1.4% of 340B-eligible prescriptions at contract pharmacies shared any direct savings with patients.6
Many hospitals fail to fund charity care
As the program has rapidly grown, charity care provided by disproportionate share hospitals (DSHs) has declined, suggesting the 340B Program is not delivering on its intended purpose and helping communities most in need.8
We support federal reform
of 340B to put patients first
Johnson & Johnson is strongly committed to the original intent of the 340B Program and believes transparency and increased accountability in the program will improve access to more affordable outpatient medicines for low-income and vulnerable patients.
Supporting efforts to reform 340B for patients
In 2025, the U.S. Senate Health, Education, Labor and Pension (HELP) Committee Chairman released a Majority Staff report on findings from a years-long investigation into the 340B Program. The report calls for legislation to increase transparency and data reporting by covered entities and for-profit middlemen to improve the program and ensure it benefits patients.9
In line with its commitment to transparency around the 340B Program, Johnson & Johnson voluntarily submitted data to aid the HELP Committee and supports the recommendations the Committee put forth in the April 2025 Report.
Citations
The 340B Program
- Figure according to Johnson & Johnson internal financial accounting. Values may have been rounded.
- Rory Martin and Harish Karne. “The Size and Growth of the 340B Program in 2024,” IQVIA. May 6, 2025. https://www.iqvia.com/locations/united-states/library/white-papers/the-size-and-growth-of-the-340b-program-in-2024. Accessed May 2025.
- Eleanor Blalock. “Measuring the Relative Size of the 340B Program: 2022 Update,” Berkeley Research Group. May 2024. https://media.thinkbrg.com/wp-content/uploads/2024/05/13163125/340BProgram_Relative_Size_WP_2022Update.pdf. Accessed May 2025.
- Ellie Blalock, Mira Ferritto, and Jeannie Taylor. “The Pharmaceutical Supply Chain, 2013–2023.” Berkley Research Group. January 2025. https://cdn.aglty.io/phrma/global/blog/import/pdfs/PhRMA_Supply-Chain-2013-2023_White-Paper_V484.pdf. Accessed May 2025.
- Aaron Vandervelde, Kevin Erb, and Lauren Hurley. “For-Profit Pharmacy Participation in the 340B Program.” Berkeley Research Group. October 2020. https://media.thinkbrg.com/wp-content/uploads/2020/10/06150726/BRG-ForProfitPharmacyParticipation340B_2020.pdf. Accessed June 2025.
- Rory Martin and Kepler Illich. “Are Discounts in the 340B Drug Discount Program Being Shared with Patients at Contract Pharmacies?” IQVIA. September 27, 2022. https://www.iqvia.com/-/media/iqvia/pdfs/us/fact-sheet/2022/340b-program-fact-sheet.pdf. Accessed June 2025.
- Milena Sullivan, Ekemini Isaiah, Kelly Brantley, and Massey Whorley. “Can Comprehensive 340B Reform Generate Federal Savings?” Avalere Health. May 29, 2024. https://advisory.avalerehealth.com/insights/can-comprehensive-340b-reform-generate-federal-savings. Accessed June 2025.
- AIR340B. “Charity Care at 340B Hospitals is on a Downward Trend.” October 2023. https://340breform.org/wp-content/uploads/2023/10/2023-Charity-Care-Report-Final-1.pdf. Accessed June 2025.
- Senate Committee on Health, Education, Labor & Pensions. “Congress Must Act to Bring Needed Reforms to the 340B Drug Pricing Program.” April 23, 2025. https://www.help.senate.gov/imo/media/doc/final_340b_majority_staff_reportpdf1.pdf. Accessed May 2025.