The 340B Contract Pharmacy Market in 2026: A Maturing Industry Dominated by Big Chains and PBMs

By Adam J. Fein, Ph.D. and Greis Kapexhiu

It’s time for Drug Channels Institute’s latest exclusive analysis of the 340B contract pharmacy market, which continues to boom along with the overall program’s expansion.

However, our 2026 analysis finds that the contract pharmacy market is now entering a more mature phase characterized by consolidation, slower growth, and increasing dominance by the industry’s largest participants.

Below, we characterize the state of the marketplace:

• Nearly two-thirds of the entire U.S. pharmacy industry participates as contract pharmacies for the 340B hospitals and federal grantees.

• The number of 340B pharmacy locations declined for the third year, due largely to the retail pharmacy shakeout and manufacturers’ 340B policies.

• Meanwhile, the total number of unique contract pharmacy/covered entity relationships continues to expand. Five multi-billion-dollar, for-profit, publicly traded pharmacy chains and pharmacy benefit managers (PBMs)—Cigna, CVS Health, UnitedHealth Group, Walgreens, and Walmart—now account for a record 77% of all relationships.

The 340B program was originally designed as a narrow policy solution to address an unintended consequence of Medicaid’s best-price provision while supporting core safety-net providers. The 2026 market data illustrate just how dramatically the program’s current operations and economic incentives have diverged from that original intent.

Read on for our latest analysis of this ever-expanding profit pool for pharmacies and PBMs. For a deep dive on what the 340B program’s growth means for drug channel participants, join Adam J. Fein, Ph.D., and Tyler Novotny on June 12 for a new live video webinar: 340B in 2026: Market Shifts, Policy Battles, and What They Mean for Stakeholders.