Cassidy Draft Proposes Sweeping 340B Program Reforms

Sen. Bill Cassidy, MD, R-La., has released a discussion draft of legislation that would substantially rework the 340B Drug Pricing Program, according to Becker's Hospital Review. The draft, published June 25, layers new transparency, oversight and accountability requirements onto the covered entities, mainly hospitals and clinics, that buy discounted drugs through the program.

The stated goals are to confirm that 340B savings actually reach low-income and uninsured patients, to prevent waste, fraud and abuse, and to provide clearer regulatory guidance in a program that has grown rapidly and drawn years of litigation. 340B requires drugmakers to sell outpatient medicines at steep discounts to safety-net providers, but how hospitals use the resulting margin has been a persistent fight among providers, manufacturers and pharmacies.

For hospital and pharmacy leaders, a discussion draft is an early signal, not law. It opens the door to lobbying and amendment. Providers reliant on 340B revenue should model how reporting mandates and patient-eligibility rules could reshape their drug economics if any version advances.