Adam Fein, President of the Drug Channels Institute, said that five large publicly traded pharmacy benefit managers (PBMs) and pharmacy chains—Cigna, CVS Health, UnitedHealth Group, Walgreens, and Walmart—continue to dominate the 340B contract pharmacy market. This statement was made in an article.
“Five multi-billion-dollar, for-profit, publicly traded pharmacy chains and pharmacy benefit managers (PBMs)—Cigna (via Express Scripts), CVS Health, UnitedHealth Group (via Optum Rx), and Walgreens, Walmart—continue to dominate the 340B contract pharmacy market,” said Fein.
According to the Government Accountability Office (GAO), the 340B Drug Pricing Program allows certain hospitals and clinics to purchase outpatient drugs at reduced prices to support underserved patients. Oversight issues have emerged as the program expanded, with critics alleging that some hospitals use 340B savings to increase revenue rather than expand care. Congressional reviews continue to assess program accountability.
Pharmacy benefit managers negotiate with drug manufacturers and health plans to determine which drugs are covered and at what cost. According to the Commonwealth Fund, their use of rebates, formularies, and spread pricing can increase total drug spending while reducing transparency. Critics argue that these practices benefit PBMs financially at the expense of consumers and independent pharmacies.
According to PhRMA, in Pennsylvania, 67 hospitals participate in the 340B program. Between 2014 and 2022, these hospitals experienced a 20% increase in assets, while charity care provided decreased by 36%. Notably, 92% of these hospitals offered charity care at levels below the national average of 2.5% of total operating costs.
Fein has led Drug Channels Institute since March 2012, specializing in pharmaceutical supply chain economics. In 2024, the Institute was acquired by HMP Global, expanding its impact on healthcare insights and education. Fein continues his role from Philadelphia, Pennsylvania.
