SNHPA Joins Campaign for Sustainable Rx Pricing

Oct 27, 2014

Safety Net Hospitals for Pharmaceutical Access (SNHPA) has joined the Campaign for Sustainable Rx Pricing (CSRxP), a broad-based coalition concerned about the skyrocketing cost of prescription medicines.

“SNHPA will bring a much needed perspective and make a valuable contribution to the effort to find sensible solutions to irrational prescription drug prices, especially those for new specialty drugs,” says John Rother, president and CEO of the National Health Care Coalition, which heads up CSRxP. “We need to move to an approach where drug pricing is based on value to the health care system. New medicines offer extraordinary promise, but we are concerned that the system that has brought us these advances will become unsustainable if we can’t find a way to bring greater rationality to prices.”

SNHPA represents more than 1,000 hospitals that participate in the federal 340B drug discount program. The 340B program requires drug manufacturers to sell pharmaceuticals at a discount to public and private non-profit hospitals that serve high volumes of low-income patients. These hospitals provide over $28 billion in uncompensated care every year. The savings they realize from 340B drug discounts enable them to expand and improve care for their vulnerable patient populations.

“Hospitals and clinics in the 340B program must care for all patients whether they can pay or not,” says SNHPA President and Chief Executive Officer Ted Slafsky. “Today, on average, 340B hospitals are either squeaking by on historically slim operating margins – around 2 percent – or they are in the red. Major drug manufacturers’ profit margins average more than 20 percent.”

Mr. Slafsky noted the significant growth in the specialty drug market. “While many of these medications offer great promise, the price tag for health care providers and patients is simply unsustainable. Even at a discount, our hospitals and patients are struggling to afford medications that can cost hundreds of thousands of dollars. We look forward to working with the Campaign for Sustainable Rx Pricing to address these challenges.”