ASCO Updates 340B Policy Statement to Expand Access, Improve Transparency

For the first time since 2014, the American Society of Clinical Oncology (ASCO) has updated their policy statement on the 340B Drug Pricing Program.¹ The statement was published in JCO Oncology Practice.

The 340B Drug Pricing Program was first enacted in 1992 as a means to improve access to prescription drugs among low-income and uninsured populations by allowing qualifying hospitals and other providers to purchase certain medications from manufacturers and discounted prices. Since then, it has become the second-largest federal drug discount purchasing program in the US, while also contributing to the consolidation of cancer care.²

The new recommendations included in the policy statement are intended to expand practice eligibility, ensure benefit to the intended patients, and address any potential abuses.

“Since drug therapies are a fundamental part of cancer treatment, the 340B program plays an important role helping more Americans access high-quality cancer care,” stated ASCO President Eric J. Small, MD, FASCO, in a press release.³ “That said, reforms focused on eligibility, transparency, and accountability are needed to reflect modern healthcare delivery and to ensure the program continues to benefit the vulnerable people it was designed to help.”

Increasing Patient Eligibility

ASCO noted that the current framework for the 340B program is reliant upon hospital-based metrics, which do not capture community-based, non–hospital-affiliated providers that lack inpatient facilities but serve low-income populations.

In turn, these new guidelines propose a ratio to determine 340B eligibility for specific practices: the indigent care ratio (ICR). The ICR is as follows:

ICR = (number of Medicaid visits + uninsured patient visits + dual-eligible Medicare/Medicaid visits) / total patient visits (under a single Taxpayer identification number [TIN])

Specific criteria are listed for consideration:

1. Practices with an ICR greater than 11.75% would qualify for 340B participation
2. Patients will only be included in the ICR numerator if the practice provided the plurality of their outpatient cancer therapeutic care
3. All visits at any practice site under a single TIN must be included to prevent site cherry-picking
4. Practices owned or operated by existing 340B-eligible hospitals would be excluded
5. Practices should undergo annual validation via claims-based audits

“We believe the combination of the existing criteria as well as this new calculation will more effectively capture the true health care landscape serving vulnerable populations with cancer,” wrote lead author Blasé Polite, MD, MPP, FASCO, a professor of medicine at University of Chicago Medicine, and coauthors, in the policy statement.¹

Additionally, independent oncology practices are meant to be able to register a child site for the 340B program if they bill under the same TIN as the eligible parent practice.

ASCO also supports potential reforms to ensure that a covered entity maintains the right to engage multiple contract pharmacies, with the fees paid to contract pharmacies and third-party administrators being capped. A civil monetary penalty was suggested for excessive fees.

Reforming 340B

Despite the fact that the 340B program was created to support health care institutions that serve high-need populations, a report from the Government Accountability Office in 2018 revealed that approximately half of the 340B-covered entities provide no discount to low-income or uninsured patients in 340B programs.⁴ Because of this, the policy statements suggest that reporting and auditing for 340B-covered entities should increase.

ASCO believes that documentation of how 340B savings are reinvested should be both mandatory and public, and that all participating entities should meet financial criteria similar to IRS 501(r) standards. Furthermore, all entities that fail to demonstrate transparency or direct savings back into patient care should be subject to rigorous enforcement.

The organization also stated that orphan drugs—drugs used to treat, prevent, or diagnose an orphan disease, which are diseases that affect fewer than 200,000 patients in the US—should not be arbitrarily excluded for critical access hospitals (CAHs) when used off label or for common conditions. These orphan drugs should be excluded from the reasonable cost calculation required of CAHs, if necessary, to secure 340B pricing, according to ASCO.

“By closing this loophole, policymakers can ensure equitable access to affordable medications, enhancing CAHs’ ability to deliver critical care to vulnerable rural patients while reinforcing 340B’s mission,” the authors wrote.¹

Controversy has also remained over the definition of a patient within the 340B drug pricing program, with discussion centering on the scope of patient eligibility and the nature of the patient-entity relationship. ASCO endorsed a definition of a patient that requires the covered entity to have an “ongoing clinical relationship with the patient and ensures that the prescribed drug is directly related to health care services provided by the entity.”¹

The final recommendation was for the Department of Health and Human services to appropriate funds or implement other funding mechanisms to support reformed program oversight and operations.

Reference

1. Polite B, Dixit N, Hennessy J, et al. 340B drug pricing program: an updated ASCO policy statement. JCO Oncol Pract. Published online May 5, 2026. doi:10.1200/OP-26-00105
2. The intersection of 340B and cancer care. American Cancer Society Cancer Action Network. March 4, 2025. Accessed May 6, 2026. https://shorturl.at/6AXxu
3. ASCO updates policy statement on 340B drug pricing program. News release. ASCO. May 5, 2026. Accessed May 6, 2026. https://tinyurl.com/4aw33ptr
4. Drug discount program: federal oversight of compliance at 340B contract pharmacies needs improvement. News release. U.S. Government Accountability Office. June 28, 2018. Accessed May 6, 2026. https://tinyurl.com/38rpnmkv