S 5244: SUSTAIN 340B Act

S 5244 in plain English: The SUSTAIN 340B Act would strengthen oversight and enforcement of the 340B drug pricing program, which requires drug manufacturers to provide discounted medications to certain safety-net healthcare providers. The bill establishes new penalties for violations and authorizes funding for implementation and inspector general audits.

Stated purpose

The SUSTAIN 340B Act aims to strengthen and reform the 340B drug discount program, which requires drug manufacturers to sell medications at reduced prices to certain health-care providers that serve low-income and underserved patients, by improving transparency, accountability, and program integrity while preserving access to discounted drugs for eligible safety-net providers.

Key points

• Imposes civil penalties of up to $5,000 per violation per day for entities that violate 340B program requirements
• Authorizes $9,000,000 per year for fiscal years 2027–2030 for program implementation
• Authorizes $3,000,000 per year for fiscal years 2027–2031 for Inspector General audits of the program
• Sets a $50,000,000 penalty collection threshold for fiscal year 2031, with ongoing thresholds for subsequent years

Arguments supporters make

• The bill closes loopholes that have allowed abuse of the 340B program, ensuring discounts actually reach low-income patients rather than boosting provider or pharmacy revenues.
• Adding transparency and accountability requirements makes the program easier to oversee, which helps protect it from the fraud and misuse that could threaten its long-term survival.
• Provisions preserving contract pharmacy access, including exceptions for emergencies and service-area changes, keep discounted drugs available in rural and underserved areas that rely on outside pharmacies.

Arguments opponents make

• New registration, recertification, and contract-cancellation requirements add administrative burdens that could strain small safety-net providers with limited staff and resources.
• Requiring covered entities to cancel contracts with pharmacies that dispensed no drugs in the past 12 months could eliminate backup pharmacy relationships that protect patient access in emergencies or low-volume rural areas.
• Critics may argue the bill tilts toward restricting the program in ways that benefit drug manufacturers—who have long sought to limit 340B discounts—at the expense of the hospitals and clinics serving the neediest patients.

Tradeoffs

Tightening program rules and oversight may reduce fraud and ensure savings reach intended patients, but the added compliance requirements and pharmacy contract restrictions could reduce flexibility for safety-net providers, potentially limiting drug access in some communities.

Current status in Congress: In committee.

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