The 340B Drug Discount Program requires drug manufacturers to provide outpatient drugs to eligible health care organizations and covered entities at significantly reduced prices.

Created in 1992, this program allows covered entities to stretch scarce federal resources as far as possible, reaching more eligible patients and providing more comprehensive services.

Eligibility for the 340B program is defined under the federal law. Six categories of hospitals are eligible to participate in the program. Also, there are ten categories of non-hospital covered entities that are eligible based on the receiving federal funding.

To participate in the 340B program, covered entities must register, be enrolled, and comply with all program requirements. Once enrolled, covered entities are assigned a 340B identification number that vendors must verify before allowing an organization to purchase discounted drugs. Covered entities must complete the recertification process on the Office of Pharmacy Affairs (OPA) 340B database website every year. Failure to recertify, results in removal from the 340B program.

Source: 340B Drug Pricing Program(DEA)