Senate Questions Health Care Firm for Profiting Off Program Meant for Poor

Why It Matters

Apexus’ outsized profits highlight potential misalignment between a federal safety‑net program and for‑profit incentives, prompting possible regulatory reforms that could reshape drug pricing and hospital financing.

Key Takeaways

• Apexus earned $227M revenue in 2022.
• Profit margins exceed 80% on 340B program.
• 340B now covers over half of nonprofit hospitals.
• Senate seeks transparency on Apexus' use of funds.
• Critics say 340B inflates patient and insurer costs.

Pulse Analysis

The 340B Drug Pricing Program was created in 1992 to allow qualifying safety‑net hospitals to purchase outpatient drugs at steep discounts, freeing up resources for underserved patients. Over the past decade, the program’s footprint has ballooned, now encompassing more than 50 % of nonprofit hospitals nationwide. This rapid expansion has attracted for‑profit intermediaries like Apexus, which manage the discount contracts and collect fees on virtually every transaction, turning a cost‑containment tool into a lucrative revenue stream.

Apexus, a subsidiary of Vizient, has become a focal point of congressional scrutiny after a New York Times investigation revealed the firm was on track for $227 million in 2022 revenue with profit margins surpassing 80 percent. Senators argue that such margins are inconsistent with the program’s charitable mission, especially as hospitals often charge patients and insurers higher prices than the discounted rates, pocketing the spread. The Senate Health Committee’s letter to Apexus seeks clarity on how the firm allocates its earnings and whether its practices exacerbate overall healthcare spending.

If lawmakers pursue stricter oversight or reform, the ripple effects could be significant for the broader healthcare ecosystem. Hospitals might face tighter controls on 340B participation, potentially reducing the financial cushion they rely on for uncompensated care. Pharmaceutical manufacturers could see altered discount structures, while insurers and patients may experience modest price reductions. The debate underscores a growing tension between public‑policy objectives and private‑sector profit motives in the U.S. healthcare market.

Senate Questions Health Care Firm for Profiting Off Program Meant for Poor

Feb. 12, 2026

The program was meant to help hospitals provide for poor patients by offering drug savings. But critics say a Texas company has turned it into a big business, driving up costs for patients and insurers.

The Senate Health Committee is seeking answers from a private company that makes millions off a federal drug program meant to help the poor.

Senator Bill Cassidy, the Republican committee chairman and a doctor from Louisiana, sent a letter last week to Apexus, the Texas‑based company, asking about its profits, business practices and role in the 340B Drug Price Program.

That program, started in 1992, was intended to provide savings to a small number of safety‑net hospitals so they could expand their care for needy patients. Providers in 340B buy drugs at a steep discount and charge patients and insurers a higher price, keeping the difference. Apexus manages 340B and collects a fee for almost every drug sold under the program.

But the program has exploded in recent years to encompass more than half of nonprofit hospitals in the United States — drawing criticism from lawmakers, drugmakers and employers who say it has added to ballooning health‑care costs.

Dr. Cassidy wrote that as a for‑profit company, Apexus had benefited from 340B’s “precipitous growth.” That has led to questions about where revenue generated from the federal program is going, he said, and whether that revenue is being used “pursuant to the original intent of 340B.”

He cited a January 2025 investigation in The New York Times that found Apexus was on track to garner $227 million in revenue in 2022 and enjoyed profit margins above 80 percent.