Executive Summary: Xcenda Analysis on 340B Drug Pricing Program
340B Covered Entities: Understanding the Hospital-Grantee Relationship
The 340B Drug Pricing Program was launched in 1992 with the goal of helping uninsured and low-income patients access prescription medications. To do this, the 340B program requires drug manufacturers to provide outpatient drugs to certain hospitals and organizations receiving federal grant funding (known as “grantees”) at discounted prices. The number of 340B hospitals, clinics, and other eligible sites has grown from 8,000 in 2000 to more than 50,000 today. With $44 billion in net spending in 2021, 340B has become the second-largest government pharmaceutical program, based on net drug spending.
To better understand the relationships between 340B hospital and non-hospital (grantee) covered entities, this December, Xcenda released new research quantifying the direct and potential relationships between hospitals and grantees. The analysis finds:
- 359 (2%) of 340B grantees were identified as a hospital or billed as a hospital in 2022.
- In total 1,656 (8%) of all 340B grantees may be affiliated with a hospital or hospital system.
- 4,218 (13%) of all 340B hospitals may be connected to a grantee or affiliated with one.
This research was funded by Gilead Sciences. Editorial control was maintained by Xcenda.