Contract Pharmacy (340B)

Contract pharmacy arrangements allow 340B covered entities to extend their program reach by partnering with external pharmacies to dispense 340B drugs to eligible patients. To establish a contract pharmacy arrangement, the covered entity and pharmacy must have a written contract that aligns with HRSA’s compliance requirements, and the pharmacy must be registered in OPAIS during a quarterly registration period.

Contract pharmacies are typically used by covered entities that do not have in-house pharmacies or that want to provide 340B access to patients who fill prescriptions at community pharmacies. They are particularly important for FQHCs, Ryan White grantees, and other non-hospital entity types.

Contract pharmacy arrangements introduce significant compliance complexity. The covered entity remains responsible for ensuring that only eligible patients receive 340B drugs through contract pharmacies, that duplicate discounts are prevented, and that auditable records are maintained for all contract pharmacy transactions. The covered entity cannot simply delegate compliance responsibility to the contract pharmacy.

Manufacturer restrictions have significantly affected contract pharmacy access for many covered entities since 2020, limiting the number of contract pharmacies through which certain drugs can be accessed at 340B prices.