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Hospitals participating in a federal drug discount program marked up cancer medicines four times for privately insured patients, and often charged cash-paying consumers the same as commercial insurers, a practice that does not “fit the mission” of serving low-income populations, a new analysis found.

Specifically, the median price charged for cancer treatments to commercial insurers or cash-paying patients was 3.8 times what was paid by 123 hospitals participating in the so-called 340B program. Moreover, the hospitals did not reduce prices charged to insurers or patients when their own purchase prices decline, according to the analysis by Moto Bioadvisors, a consulting firm.


The report also noted that the markups appear to be responsible for a “significant portion” of costs shouldered by employees who have commercial health insurance. As an example, the firm pointed to the differing profits that can be earned from purchasing Darzalex, a multiple myeloma treatment sold by Johnson & Johnson (JNJ).

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