The 340B Program
The 340B Program was created to ensure that core safety net providers continue to receive discounts from pharmaceutical manufacturers to help them “stretch scarce federal resources.” Because of its complexity, the program relies upon all of its stakeholders (manufacturers, covered entities, pharmacies, wholesalers, etcetera) working together to ensure that pharmacy access is extended to the most vulnerable people in the American healthcare system.
We at CiiTA understand that covered entities are working to provide the most effective patient care under difficult conditions, and we know that the 340B Program is an important part of that care. We believe that while the 340B Program is critical, it is also very complex and presents many management challenges. The covered entities that qualify for the 340B discount on drugs and the manufacturers who research and develop those drugs are jointly responsible for ensuring a compliant, workable, and ultimately enduring 340B Program.
Growth of the Program
As the 340B Program matures and as covered entities’ understanding of how to maximize 340B usage becomes more sophisticated, manufacturers are observing a noticeable rise in 340B sales. While there is debate about whether this growth is beneficial, it has certainly created concerns. It has allowed routine issues to snowball into larger and more complicated problems that require the participation of all stakeholders to resolve.
As sales increase, so do the opportunities for Program errors such as duplicate discount and diversion. Understanding and mitigating these errors requires manufacturers to initiate sensitive conversations with their important customers.
340B Visibility and Program Issues
No one participant in the Program has visibility into overall 340B Program data and operation. Manufactures, covered entities, and outside parties such as State Medicaid agencies, contract pharmacies, administrators, and payers each have responsibility for management of key portions of the Program, and each stakeholder has little visibility outside its own portion.
This creates operational errors that are difficult to catch and often go unnoticed. These operational errors require the cooperation of all parties to identify and remedy.
For example, Medicaid, ADAP, and commercial duplicate discounts can account for a significant percentage of total 340B sales. However, identifying and mitigating duplicate discounts requires detailed claims data from covered entities as well as from the program in question. Each program may have different data formats and methods for preventing duplicate discounts which may not be understood by all the parties involved. Additionally, the data can be difficult to acquire and frustrating for the reviewers to interpret, as it varies in quality and is often missing key fields.
While the 340B Program does have rules and regulations, the growth of the Program and other factors in the health system make Program implementation complicated and open to interpretation. However, the Office of Pharmacy Affairs is facing resource challenges and oversight of the Program is limited.
In order for this vital program to be sustainable, Program issues such as diversion and duplicate discount need to be managed. It therefore falls to the manufacturer to provide primary oversight of Program operation by working with covered entities to address potential issues and assure compliant operation.
That's where CiiTA comes in with thoughtful, actionable intelligence around the 340B Drug Discount Program. Let us guide you as you navigate the complexities of 340B.
How Does 340B Affect You?
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Develop Your 340B Strategy
CiiTA has, through extensive experience, developed a set of best practices to help guide you through the creation of your 340B strategy. Download our process document to facilitate the development of your strategy.