The pharmaceutical industry has launched a stealth assault on a critically important drug discount program that low-income patients of organizations such as Neighborhood Health depend on for life-saving medicines. And, make no mistake, lives are at stake.
The 340B program was created by Congress in the 1990s to give safety-net providers such as ours access to reduced pricing they could not negotiate on their own. Republicans and Democrats alike support the program because it stretches scarce federal resources as far as possible for the common good. Nothing is wasted.
For community health centers such as Neighborhood Health, 340B discounts make medications and services affordable for their patients. These patients typically suffer from a higher incidence of chronic disease, poverty and lack of insurance. They include veterans, those infected with HIV, people who have lost their jobs and health insurance in the economic decline, or even essential workers who test positive for COVID-19 but do not require hospitalization. The cost of medicines can easily push them further into poverty, disease, even death.
A pandemic would seem the worst possible time to threaten a critical program that makes medicines affordable for the poor. Yet that is precisely what the largest and most profitable pharmaceutical companies in the world are doing.
These manufacturers are utilizing a “death by a thousand cuts” approach to dismantle and weaken 340B discounts. These companies' range of tactics include imposing arbitrary reporting requirements (health centers already comply, by law, with strict reporting standards describing how the discounts are to be used).
Drug makers are also taking measures to severely restrict how 340B providers can contract with pharmacies.
Compounding the problem are third-party compliance vendors and pharmacy benefit managers intent on pocketing profits that could be used to lower the cost of vital medications, provide additional critically needed services and improve patient outcomes.
A White House Drug Pricing Executive Order issued in September is the latest blow. The order claims to lower out-of-pocket costs health center patients pay for EpiPens and insulin, but it would have the opposite effect.
Many patients will end up paying more for drugs, and it would impose administrative burdens for both providers and patients.
Drug manufacturers will claim that reining in 340B discounts falls under the mantle of ensuring fiscal integrity. Yet, health centers such as ours have proven over time to be excellent stewards of tax dollars and 340B discounts. We are nonprofits, accountable by law, and driven by mission – not money.
The broadside attacks on 340B started long before COVID-19 landed on the nation's doorstep, but the pandemic offers a convenient cover and urgency to move forward with measures that may do more harm than good.
Everyone agrees high drug prices must be addressed – but community health centers such as Neighborhood Health are the solution, not the problem.
Congress and the federal Health Resources & Services Administration must act now to save this vital program and the patients it serves. As a result of the actions of these pharmaceutical manufacturers, patients who cannot access the vital medications they rely on may very well die.
Dr. Matthew Sprunger is an obstetrician-gynecologist in Fort Wayne and a board member of Neighborhood Health.