Lori M. Reilly, Chief Operating Officer for the Pharmaceutical Research and Manufacturers of America (PhRMA), said that the 340B program is increasing taxpayer costs without demonstrated patient benefits and requires accountability and reform. The statement was made on X.
"The evidence is clear and impossible to ignore: The 340B program is driving up taxpayer costs with no proof that patients benefit," said M. Reilly. "At the Senate HELP Committee hearing, lawmakers on both sides of the aisle called for accountability and reform."
On October 23, 2025, the Senate Health, Education, Labor, and Pensions (HELP) Committee conducted a bipartisan hearing titled "The 340B Program: Examining Its Growth and Impact on Patients." The hearing included testimony from officials of the Government Accountability Office (GAO) and Congressional Budget Office (CBO), as well as academic experts. Senators from both parties called for transparency and oversight to determine whether patients benefit from the discounts provided by the program, indicating potential legislative reforms to enhance accountability.
An independent analysis conducted in 2025 revealed that in 2021, the displacement of commercial manufacturer rebates by 340B discounts increased health costs for employers and workers by approximately $7.8 billion. It also reduced combined federal and state tax revenues by roughly $1.8 billion ($1.4 billion federal; $418 million state). The study associates foregone rebates with higher net drug spending and lower taxable income, underscoring a significant taxpayer impact that necessitates policy review.
According to an interim staff report by the Federal Trade Commission (FTC) in 2024 on pharmacy benefit managers (PBMs), it was concluded that the six largest PBMs manage nearly 95% of U.S. prescriptions. Through vertical integration and opaque practices such as spread pricing and steering to affiliated pharmacies, these PBMs may inflate costs and disadvantage independent pharmacies—harms borne by patients and payers. The report also highlights issues like data opacity, rebate-driven distortions, and steering practices that can undermine patient choice and strain rural access.
Reilly serves as Chief Operating Officer at PhRMA, where she oversees federal, state, and international advocacy along with alliance development. Her responsibilities include developing policy solutions aimed at reducing patient costs and improving access while representing the biopharmaceutical sector in congressional and regulatory forums on pricing, access, and supply chain issues.
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