- The 340B drug program requires manufacturers to provide steep discounts for certain medications to safety net clinics, Federally Qualified Health Centers and other health care providers that serve low-income and uninsured patients.
- Those providers accuse the drug manufacturing industry of restricting access to those discounted medications, a charge the pharmaceutical industry denies.
- Legislation to prevent manufacturers from restricting access to those drugs awaits final action in the House.
This summary was written by the reporters and editors who worked on this story.
SPRINGFIELD, Ill. (Capitol News Illinois) – Advocates for health care providers that treat low-income and uninsured patients are pressuring state lawmakers to pass legislation they say would prevent drug manufacturers from restricting access to medications that are discounted through a federal pharmacy program.
The program is known as the 340B Drug Pricing Program. It requires drug manufacturers to provide outpatient drugs to safety net clinics, Federally Qualified Health Centers, AIDS clinics and a variety of other health care providers that treat Medicaid patients at substantially reduced prices.
The program has been in place since 1992. But in recent years, according to the Illinois Primary Health Care Association, drug manufacturers have found ways to limit the distribution of those drugs by restricting where patients can go to fill their prescriptions.
“What pharmaceutical manufacturers began doing was limiting the distribution of these drugs to a single location,” Cyrus Winnett, executive director of the IPHCA, said in an interview. “And when I say single location, I don’t mean Walgreens chain or CVS or a local independent. I mean one physical location, which for our organizations and their patients that have wide service areas, that’s extremely limiting,”
Winnett’s organization represents about 430 Federally Qualified Health Centers, or FQHCs, in Illinois that serve a combined 1.5 million patients.
FQHCs are primary care clinics, often run by local health departments or nonprofit charities. They receive federal funding to provide comprehensive primary health services to underserved populations, including Medicare and Medicaid patients and the uninsured.
Winnett said the vast majority of the clinics his organization represents do not have their own on-site pharmacies. Instead, they contract with outside pharmacies to fill prescriptions that are covered by the 340B program.
He said the practice of restricting where patients can fill 340B prescriptions began in 2020 with one manufacturer and one drug. But it has since ballooned to more than 50 manufacturers and thousands of different medications.
“You have providers in the clinic assessing the patient, reaching a diagnosis, and then trying to connect them with a drug that’s available to them and one that they can afford,” Winnett said. “And there was this problem that crept up where providers were having to scramble to find alternative medications, either for patients that they were newly diagnosing or ones who have even been on a particular medication but are being forced to change because they can no longer access it.”
Pending legislation
The legislation pending in the General Assembly is a Senate amendment to House Bill 2371. Sponsored by Sen. Dave Koehler, D-Peoria, it would prohibit anyone, including drug manufacturers, from imposing any restrictions on the ability of 340B-eligible clinics and hospitals to contract with outside pharmacies to fill 340B-funded prescriptions.
It also prohibits anyone, including manufacturers, from requiring 340B clinics and hospitals, or their contract pharmacies, to submit ingredient cost or pricing data about 340B drugs beyond what is required by state or federal law. And it prohibits anyone from imposing requirements regarding how clinics, hospitals or contract pharmacies manage their inventory of 340B drugs.
In testimony before the House Executive Committee near the end of the 2025 legislative session, Jessica Lynch, of the Pharmaceutical Research and Manufacturers of America, or PhRMA, denied that drug makers are restricting access to discounted medications and said the proposed legislation would not benefit health care consumers.
“This is not an access bill,” she said. “This bill does not directly impact patients at all in any clear or comprehensive way. A pharmacy’s status as a contract pharmacy has no impact on whether or not a patient can go pick up their medicines at the pharmacy.”
In an email statement Monday, PhRMA spokesperson Tom Wilbur did not comment on the specific language of the legislation. But he said the organization believes generally that the 340B program needs broader reforms that would be best addressed at the federal level.
“The 340B program was created by Congress to help low-income and uninsured patients access medicines, but there is little evidence that patients are benefiting,” Wilbur said. “Instead, large tax-exempt hospitals and their for-profit partners are exploiting the program, buying medicines at steep discounts, and then marking them up by thousands of dollars.”
The bill awaits final action in the House before it can be sent to Gov. JB Pritzker. A spokesperson for House Speaker Emanuel “Chris” Welch said in an email the bill is still under review and the next steps will be determined in consultation with the Democratic caucus.
The next session of the House is scheduled for Wednesday, March 18.
(Reporting by Peter Hancock, Capitol News Illinois)
Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.
This article first appeared on Capitol News Illinois and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.
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