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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Audit of State AIDS Drug Assistance Programs' Use of Drug Price Discounts," (A-01-97-01501)

January 2, 1998

Complete Text of Report is available in PDF format (3.1 MB). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


Recent amendments to the Ryan White Comprehensive AIDS Resources Emergency (CARE) Act require States to use a portion of Care Act funds for AIDS drug assistance programs (ADAPs). Section 340B of the Public Health Service (PHS) Act provides for mandatory discount prices for eligible PHS-funded entities electing to purchase drugs directly from manufacturers or wholesalers, but participation is voluntary. We analyzed 1996 AIDS drug expenditures for 5 high dollar volume ADAPs who chose not to participate in the 340B drug pricing program. We found that the 5 ADAPs could have purchased an additional 8 percent or $4.4 million of drug therapies had they participated. As a result, there is significant potential for these nonparticipating ADAPs to provide additional drug therapies that could improve the quality and length of life for individuals with AIDS. In our final report we recommend actions that the Health Resources and Services Administration can take to encourage further participation in the 340B drug pricing program.