Last Thursday the Berkeley Research Group released a study attributing a sharp increase in the 340B drug discount program to the fact that hospitals across the country are acquiring physician-based oncology practices.

The 340B program requires pharmaceutical manufacturers with Medicaid-covered products to give discounts on covered drugs purchased by eligible entities, which include disproportionate share hospitals, critical access hospitals and children’s hospitals.  The study found that when hospitals acquired oncology practices, their 340B purchase volume grew at three times the rate of hospitals that didn’t acquire practices.  The study indicated that the volume of charity care provided by those hospitals did not appear to have increased correspondingly.

The Biotechnology Industry Organization, which funded the study, cited the findings as evidence that some hospitals are using the 340B program to increase their bottom line rather than serve the underprivileged, as intended by the program.

Safety net hospitals don’t agree.  The trade group Safety Net Hospitals for Pharmaceutical Access responded with a statement that “big pharma has purchased another study.”