The recent attention in health care has been focused on Health and Human Services (HHS) Secretary Robert F. Kennedy’s partnership with Department of Agriculture Secretary Brooke Rollins to gain food choice waivers from the states.
Thus far, 12 states—Arkansas, Colorado, Florida, Idaho, Indiana, Iowa, Louisiana, Nebraska, Oklahoma, Texas, Utah, and West Virginia—have signed on to this push to remove candy and sugary sodas from SNAP benefits and the removal of toxic dyes and ultra-processed foods from its offerings.
Six new states are joining the MAHA movement! Yesterday at the Great American Farmers Market, @secrollins and @seckennedy signed food choice state waivers for West Virginia , Florida, Colorado, Louisiana, Oklahoma and Texas to remove unhealthy foods from SNAP.… pic.twitter.com/Q8sAqaDBQP
— Dept. of Agriculture (@USDA) August 5, 2025
READ MORE: Gone in a SNAP: RFK Jr. and MAHA End the Decades Long Candy and Soda Gravy Train
The Tuesday news that HHS Secretary Kennedy canceled 22 mRNA vaccine contracts — a nearly $500 million partnership with pharmaceutical corporations- has also been making a splash.
While this is terrific news and gains toward Making America Healthy Again, what is slipping beneath the radar is the less bright and shiny news of Big Pharma’s influence on drug pricing programs. This will not only affect Americans’ health, but also fuel and increase taxpayer costs.
On March 29, Senior Editor Joe Cunningham explained the importance of the 340B Drug Pricing Program and reported on Big Pharma’s push to restrict and even eliminate this necessary tool for rural hospitals to manage their unique health care concerns.
Enacted in 1992, the 340B program requires pharmaceutical companies to provide discounted medications to qualifying hospitals and clinics. It’s not funded by taxpayers—drugmakers foot the bill. And for many rural hospitals across the country, those discounts are the difference between staying open or closing their doors.
Without the 340B program, smaller healthcare providers—many already operating on razor-thin budgets—wouldn’t be able to afford life-saving medications for their patients. And if those hospitals go under, families in the rural part of the country would be left with few, if any, local options. It’s not just about inconvenience. In emergency situations, travel delays can mean the difference between life and death.
READ MORE: Trump Stands Firm Against Big Pharma, Preserves Lifeline for Rural Hospitals
The Next Threat to Rural Healthcare Isn’t the Big Beautiful Bill
Since the passage of the One Big Beautiful Law (OBBL), watchdog organizations have increased their demands for lawmakers to rein in the 340B Drug Pricing Program.
An April Senate report by Sen. Bill Cassidy (R-LA), documented the program’s abuses by hospitals. His report has been used far and wide to beat that drum against the program. The Council for Citizens Against Government Waste (CCAGW), a coalition of conservative and constitutional grassroots groups, has also joined this chorus. In a July 16 letter to House Speaker Mike Johnson (R-LA) and Senate Majority Leader John Thune (R-SD), CCAGW deemed 340B reform a necessary step in opposing “Waste, Fraud, and Abuse in Healthcare Industry.”
Hospitals receive approximately 37% of all Medicare spending, and 32% of all Medicaid spending–a total of around $650 billion annually. Government money creates both dependence and rent seeking behavior, but it is also a conduit for waste, fraud, and abuse. The market distorting actions from these large non-profit hospitals are the driver of many of the worst problems with our nation’s healthcare.
But a July 29 exclusive by the Washington Examiner has exposed ties between some of the signatories of this letter and Big Pharma.
Nine of the groups that signed the letter have received funding from Pharmaceutical Research and Manufacturers of America, better known as PhRMA, the primary trade organization representing the pharmaceutical industry. The 340B program forces drug manufacturers to sell their products at lower prices to certain rural healthcare providers, cutting into profit margins.
Many of the organizations signing the letter have pulled in six-figure sums from PhRMA.
The Center for a Free Economy, for instance, reeled in over $500,000 in contributions from the trade association between 2022 and 2023, about a third of its total revenue during the latter year. Consumer Action for a Strong Economy, meanwhile, brought in $315,000 in PhRMA contributions between 2021 and 2023.
Other signatories that took significant amounts of money from PhRMA between 2021 and 2023 included the Trade Alliance to Promote Prosperity, which took $175,000, American Commitment, which received roughly a quarter million dollars, Competitive Enterprise Institute, with $210,000 in PhRMA funding, and the Council for Citizens Against Government Waste, which took in $100,000 between 2019 and 2020.
Of greater concern to recipients of the 340B Drug Pricing Program is not only the disruption to rural health care, but changes in its oversight. The Health Resources and Services Administration (HRSA) is currently tasked with this.
However, reports have circulated that oversight may be moved to the Centers for Medicare & Medicaid Services (CMS), which has prioritized cost-cutting measures that align with Big Pharma concerns over the hospitals.
Moving 340B under the CMS is not just a routine change to the letterhead, experts said. Instead, it could bode ill for the safety-net providers that benefit from the drug discount program, which was designed to help vulnerable and low-income patients access medications by requiring drugmakers to give discounts on outpatient drugs to certain hospitals and clinics that qualify.
Roughly 3,000 hospitals benefit from discounted drugs under the program, which accounted for a record $66.3 billion in purchases in 2023, according to government data. That’s up more than 50% from $43.9 billion just two years prior.
Critics of 340B say the program has mutated well beyond its original intent. Drugmakers argue that hospitals are manipulating 340B in order to profit, while hospitals say drugmakers are attempting to avoid shelling out discounts they’re owed to protect their bottom lines. That’s as 340B savings can be steep — generally 20% to 50% off the list price of a drug.
Follow the #340B dollars: After becoming #340B covered entities, disproportionate share hospitals (DSH) increase investments…in stocks, bonds, and other financial instruments! Meanwhile, investments in uncompensated care were flat/down. 👇
The 340B program desperately needs to… pic.twitter.com/fB0fgs4Maf
— Adam J. Fein (@DrugChannels) July 31, 2025
Follow the #340B dollars: After becoming #340B covered entities, disproportionate share hospitals (DSH) increase investments…in stocks, bonds, and other financial instruments! Meanwhile, investments in uncompensated care were flat/down.
The 340B program desperately needs to be modernized so that it benefits the genuine safety-net services of healthcare providers, while appropriately supporting low-income and uninsured patients.
Source: @MagnoliaAccess
Community health centers (CHCs) that will be disproportionately affected by these changes are pointing out the abuses of the program, which only serve to rob the communities that most need it. They are also pushing back and sounding the alarm.
An important tool CHCs use to expand access is the 340B Drug Pricing Program, which requires drug manufacturers to offer discounts to safety-net providers. The program was designed to reduce financial barriers for patients, helping them afford life-saving medications and allowing providers to reinvest in expanded care.
But over time, that mission has been compromised. Large hospital systems, not bound by the same level of accountability, have taken advantage of the program’s lack of transparency. Well-funded hospitals can purchase drugs at steep discounts, bill patients or insurers full price, and pocket the difference. Meanwhile, the patients the program was created to help, especially in rural and low-income areas, are being left behind.
Now, with potential cuts to Medicaid looming, the need for reform is even more urgent. Community Health Centers are already stretched thin. If 340B savings continue to be siphoned away from true safety-net providers, the consequences for vulnerable Pennsylvanians could be devastating.
It is clear that more focused oversight to prevent further fraud, waste, and abuse needs to occur. However, should pharmaceutical companies with a vested interest in seeing the 340B Drug Pricing Program restricted or eliminated be so intimately involved in the process?
Even tenuous connections from some of the CCAGW orgs to PhRMA raise legitimate concerns about Big Pharma’s influence and reach.
In addition to the 340B program, the letter touched on other issues, including Medicaid reform and tax policy.
The pharmaceutical industry has a robust influence network, paying for lobbying campaigns, media influence operations, and advocacy operations across the country.
It boils down to the action of the administrative arm, and currently, HRSA appears to be willing to test out the rebate program that the major drug providers have been clamoring for. On July 31, HRSA announced a “voluntary” 340B Rebate Model Pilot Program.
Today, the Health Resources and Services Administration (HRSA) announced the availability of a voluntary 340B Rebate Model Pilot Program for drugs on the CMS Medicare Drug Price Negotiation Selected Drug List for year 2026 from qualifying manufacturers meeting specific criteria.
HRSA is introducing this pilot program to test the rebate model on these drugs in a methodical and thoughtful approach to ensure a fair and transparent 340B rebate model process. HRSA is implementing this pilot to better understand the merits and shortcomings of the rebate model from the perspective of affected stakeholders, and to help shape any future 340B rebate models that align with the 340B statute and the Administration’s goals.
“The 340B Program provides vital healthcare access for high-need communities by allowing health care providers – also known as covered entities – to purchase medications at reduced prices,” said HRSA Administrator Tom Engels. “Today’s announcement of the availability of a Rebate Model Pilot Program addresses concerns we have received from both covered entities and manufacturers, while creating a measured approach to the process of approving manufacturer rebate models under the 340B Program. We look forward to receiving comments and working with everyone to ensure that the program operates with accountability, transparency and adherence to the 340B statute, allowing covered entities to stretch scarce resources as far as possible.”
The OBBL cuts to Medicaid are intended to combat fraud and shore up the safety net for the citizens for whom it was intended, while the $50 billion Rural Health Transformation Program will bolster reinvestment in rural hospitals and CHCs.
The hope is that these measures will strengthen the commitment to actual patient care while driving savings for the taxpayer. Both of those working in tandem can help blunt Big Pharma’s insidious influence across the health care landscape.
Editor’s Note: Help us continue to report the truth about corrupt politicians like Sen. Bill Cassidy.
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