HRSAs 340B Drug Pricing Program An Update - PowerPoint PPT Presentation

1 / 49
About This Presentation
Title:

HRSAs 340B Drug Pricing Program An Update

Description:

Discuss updates with the 340B Drug Pricing Program to include: ... Organon USA, Inc. Paddock Labs. RD Plastics Co Inc. Rx Elite Holdings, Inc. ... – PowerPoint PPT presentation

Number of Views:1313
Avg rating:3.0/5.0
Slides: 50
Provided by: HRS869
Category:

less

Transcript and Presenter's Notes

Title: HRSAs 340B Drug Pricing Program An Update


1
HRSAs 340B Drug Pricing Program An Update
  • 11th Annual PPN Conference
  • Las Vegas, NV
  • August 15, 2007
  • Christopher A. Hatwig, M.S., R.Ph.

2
Objectives
  • Review requirements for DSH participation in 340B
  • Discuss updates with the 340B Drug Pricing
    Program to include
  • The Office of Pharmacy Affairs (OPA)
  • The Pharmacy Services Support Center (PSSC)
  • The Prime Vendor Program (PVP)
  • Review pending FRNs and 340B legislation

3
Background 340B Drug Pricing Program
  • 1990 -Congress created Medicaid rebate law
  • Drug manufacturers responded by increasing prices
  • 1992 - Congress passed Veteran Health Care Act
    (VHCA) intended to extend relief to govt payers
    of drugs
  • Act stated that manufacturers participating in
    Medicaid must sign a Pricing Agreement to
    participate in the 340B program
  • Provides discounts on outpatient covered drugs
  • Required drug manufacturers to give best price to
    disproportionate share hospitals and certain
    covered entities grants
  • Also referred to as Section 602, PHS or
    340B pricing

4
340B Covered Entities Eligible to Participate
  • Disproportionate Share Hospitals (DSH)
  • FQHC LAs
  • HRSA Grantees
  • Federally Qualified Health Centers (FQHC)
  • Hemophilia Treatment Centers
  • Ryan White Programs (HIV programs)
  • Sexually Transmitted Disease programs
  • Tuberculosis Programs
  • Title X Family Planning Clinics
  • Urban 638 Tribal Programs

5
(No Transcript)
6
What Drugs Are Covered?
  • Non-covered drugs
  • Vaccines
  • Drugs given to the patient in inpatient care
    settings
  • Covered drugs
  • Outpatient Prescription drugs
  • Over-the-counter drugs (if accompanied by a
    written prescription)
  • Clinic administered drugs within eligible
    facilities
  • ER drugs
  • Drugs in other amb care settings (e.g. day
    surgery)

Aggressive discounts have been negotiated for
vaccines and other non-covered by the Prime
Vendor Program
7
Current Patient Definition Requirements for 340B
Hospitals
  • Three criteria to meet
  • 1. The covered entity must maintain records of
    health care services for the individual
  • 2. The individual must receive care from a health
    care professional who is employed by or under
    contract or other arrangements with the covered
    entity and
  • 3. Responsibility for the care provided must
    remain with the covered entity.

8
Inventory Management
  • To ensure compliance and to optimize 340B
    savings, Most DSH will need to utilize 340B
    pricing within mixed (inpt/outpt) patient care
    settings
  • Two options in meeting program guidelines
  • Separate physical inventories
  • Virtual inventory management using split billing
    software
  • Requirements to avoid diversion of 340B product
  • Retrospective replenishment program
  • NDC to NDC match (11 digit match)
  • Reports/subject to audit

9
340B Service Options
  • In-House Pharmacy
  • Traditional
  • Telepharmacy
  • Management company operated
  • Contracted Pharmacy
  • Community retail
  • Mail order
  • Prescriber Dispensing

10
Current Contract Pharmacy Guidelines
  • Each covered entity may use only one pharmacy to
    provide all pharmacy services
  • The entity has the choice of using either an
    in-house pharmacy or a contract pharmacy for site
  • There are no limits on how many in-house
    pharmacies a covered entity can operate
  • Larger DSH facilities typically manage their own
    in-house outpatient pharmacy. Contract model
    more prevalent in smaller DSH and community
    health centers
  • Ship to, bill to arrangement

11
Typical 340B Chain of Distribution
MANUFACTURER
No Medicaid Rebate
WAC
Chargeback
340B Non-340B Accts
WHOLESALER
MEDICAID FEE-FOR- SERVICE
Payment
340B
Non-340B
Bill AAC
COVERED ENTITY
CONTRACT PHARMACY
Bill UC
Dispensing Fee
Co-pay (if applicable)
Dispensed or Administered
OTHER PAYERS
Dispensed
Co-pay
ELIGIBLE PATIENT
Powers Pyles Sutter Verville, PC
Bill von Oehsen (202) 466-6550
William.vonOehsen_at_ppsv
.com
12
The Value of 340B Savings
  • Discounts range from 25 to 50
  • DSH see savings in the range of 22 to 40 below
    GPO prices
  • A Mathematica study commissioned by HRSA
    documented an average of 27 savings
  • Other HRSA grantees see even great savings
  • The 340B Prime Vendor Program also negotiates
    sub-ceiling discounts
  • Although covered entities are entitled to a
    ceiling price that averages 51 percent of AWP,
    they may negotiate sub-ceiling discounts
  • Additionally value may be available on inpatient
    drugs (more later on this)


13
Program Administration
  • Three Legs of the 340B Program
  • Office of Pharmacy Affairs (OPA)
  • Pharmacy Services
  • Support Center
  • (PSSC)
  • 340B Prime Vendor
  • Program (PVP)

340B Program
OPA
PVP
PSSC
14
Office of Pharmacy Affairs (OPA) Mission and
FunctionFederal Register 9/21/2004
  • Responsible for management and oversight of the
    340B Programs
  • Manage pharmaceutical pricing agreements (PPAs)
    with industry
  • Manage covered entity eligibility and enrollment
  • Promote access to clinically and cost-effective
    pharmacy services through
  • Maximizing the value of participation in 340B
  • Developing innovative pharmacy services
  • Being a Federal resource for pharmacy practice

15
10
16
(No Transcript)
17
12
18
340B Program Integrity Concerns
  • Office of the Inspector General (OIG Reports)
  • Industry
  • Covered entity compliance
  • Diversion
  • Patient definition
  • Duplicate discounts
  • Covered Entities
  • Industry compliance
  • Overcharges
  • Restrictive pricing practices (specialty
    distributors, IVIG, etc.)
  • Pricing transparency

19
340B Program Integrity Pilot Project
  • Recommended by the OIG and certain drug
    manufacturers
  • Test collaboration of OPA/Manufacturers to
    jointly publish verified price file to
    marketplace via the Prime Vendor Program to
    wholesale distributors
  • Possible benefits Increased pricing integrity
    and transparency
  • Six manufacturers and one wholesaler currently
    participating others encouraged to participate
  • Project period April 1, 2007 through March 30,
    3008

20
340B Basics Regulation and Policy
  • Policy issued via Federal Register Notice
    publication.
  • www.hrsa.gov/opa/federalregister.htm
  • Process
  • - OPA drafts guidance
  • - notice published in federal register
  • - public comment requested/received
  • - comments reviewed/considered
  • - notice finalized
  • HRSAs OPA currently has three FRNs pending
    comment and final publication

21
Proposed Guidance Definition of Patient 72
FR 1543
  • Clarifies previous FRN of October 1996
  • A clear and enforceable definition to help ensure
    against diversion and support 340B program
    integrity
  • Clarifies requirement to keep records of the
    patients health care
  • Clarifies relationship between covered entity and
    medical provider who generates prescription of
    340B drugs
  • Provides guidance for DSHs as to which its
    clinics may participate in 340B
  • Status
  • Comment Period 1/12/07 03/13/07
  • Comments being reviewed and final publication
    being developed

22
Proposed Guidance Contract Pharmacy 72 FR
1540
  • Updates previous FR Notice of August,1996
  • Builds upon experience with Demonstration
    Projects
  • Incorporates multiple pharmacies as standard
    option
  • Network model arrangements would still require
    Alternative Methods Demonstration Projects
    (AMDPs) approval
  • Status
  • Comment Period 1/12/07 03/13/07
  • Comments being reviewed and final publication
    being developed

23
Proposed Guidance Childrens Hospitals (new FRN)
  • References section 6004 of the DRA
  • Clarifies that childrens hospitals are subject
    to the same 340B responsibilities as other
    covered entities
  • Describes application procedures for childrens
    hospitals
  • Reaffirms drug manufacturers responsibility to
    furnish discounts under Pharmaceutical Pricing
    Agreement (PPA).
  • Feasibility of an independent auditor to verify
    eligibility
  • Status
  • Published in Federal Register July 9, 2007
  • Sixty day comment period closes September 7, 2007

24
Patient Safety/Clinical Pharmacy Initiative
  • Patient Safety Problem
  • IOM reports medication errors injure 1.5 Million
    people and cost billions annually.
  • Pharmacy services in HRSA programs safety-net
    partners growing rapidly.
  • HRSA desires these programs to be the best and
    safest in the United States.

25
FY 2008 2.94 Million Budget Request for OPA
  • House Senate Appropriations Committees
  • Funds will enable OPA to begin to
  • Improve Program Integrity
  • Increase compliance with 340B pricing
    requirements
  • Publish Federal Register Notices to clarify 340B
    guidance
  • Improve OPA-IS and begin annual verification of
    covered entity data
  • Increase stakeholder training and technical
    assistance
  • Improve Program Transparency
  • Evaluate collaborative 340B Pricing Pilot and
    possibly expand it
  • Encourage voluntary manufacturer posting of
    pricing files to the 340B Prime Vendor secure Web
    site

26
HRSA Pharmacy Services Support Center at APhA
27
About PSSC
  • Established through a contract between APhA and
    HRSA, signed September 27, 2002.
  • Enhances Office of Pharmacy Affairs (OPA)
    resources to optimize the value of the 340B
    program in order to provide affordable,
    comprehensive pharmacy services that improve
    medication use and advance patient care and
    patient access to affordable drugs.

28
Pharmacy Services Support Center
  • Information management
  • Organizing pharmacy expertise and resources
  • Responding to 340B inquiries
  • Providing technical assistance
  • Policy analysis
  • Monitoring pertinent policy developments
  • Communication and education on policy issues
    impacting 340B and pharmacy services.
  • Networking
  • Communication and education
  • Project development

29
Learning Management System
30
PSSC PharmTA
  • Free technical assistance for 340B-eligible
    entities interested in setting up or enhancing
    clinically and cost-effective pharmacy services
  • To request TA
  • Call 1-800-628-6297
  • E-mail pssc_at_aphanet.org

31
Optimization Resources
  • Program Assessment
  • financial
  • operational
  • compliance/integrity
  • Implementation Plans
  • Financial Analysis
  • Formulary Management

32
340B Action Plans
33
Interactive Financial Analysis
34
Formulary Management
35
HRSAs 340B Prime Vendor Program
36
The Prime Vendor Program
  • In addition to the cost savings available through
    the 340B Program, its Prime Vendor Program (PVP)
    provides additional savings to DSHs and HRSA
    grantees
  • The mission of the PVP is to improve access to
    affordable medications for all 340B covered
    entities by
  • Lowering participants supply costs by expanding
    the current PVP portfolio of sub-340B priced
    products
  • Providing covered entities with access to
    efficient drug distribution solutions to meet
    their patients needs
  • Providing access to other value added products
    and services meeting covered entities unique
    needs
  • Participation is free and voluntary for all 340B
    eligible participants

37
Estimated Prices For Selected Public Purchasers,
as Percent AWPvon Oehsen Pharmaceutical
Discounts Under Federal Law State Program
Opportunities
0
20
40
60
80
100
100.0
AWP
80.0
AMP
67.9
Medicaid (Min.)
60.5
Medicaid Net
51.7
FSS
Private Sector Pricing
49.0
340B
47.9
FCP
34.6
VA Contract
Stephen Schondelmeyer, PRIME Institute,
University of Minnesota (2001)
38
HPPIs History as the PVP
  • Late 2003 - AmerisourceBergen (ABC) subcontracted
    the responsibilities of Prime Vendor Program to
    HPPI
  • Sept. 2004 HPPI awarded PVP contract by HRSA
  • Jan/Feb. 2007 HPPI met or exceeded all 26
    performance criteria within the contract. HRSA
    granted contract extension through 2008
  • July to Sept., 2007 Program transitions to new
    non-profit company named Apexus

39
Apexus
  • Non-profit subsidiary corporation - June 18, 2007
  • HRSA fully supported
  • Dedicated to managing the PVP with HRSA
  • BODs will include representation from the PVPs
    participants
  • Transition will be seamless for HRSA and PVP
    participants
  • Minimal change to PVP logo

40
340B PVP Updates
  • Contracted from a single national distributor to
    13 national, regional, and specialty distributors
  • Expanded to over 5,200 participants
  • Contracted with 50 suppliers representing over
    2,800 products and services
  • Major MIS Related Projects
  • New contract management system software being
    implemented
  • Major modifications to PVP participant databases
  • Building interface to HRSAs database for
    eligibility
  • Expanding demographic data to include multiple
    contract pharmacy relationship and unique
    identifiers for participants

41
340B PVP Updates (cont.)
  • Two additional FTEs (Analyst, Pharmacy
    Director), plus Pharmacy Intern
  • Three participant councils provide program
    guidance (DSH, CHC, and Title X Family Planning)
  • Average sub-340B savings on PVP contract sales
    across all participants for 2006 was 17
  • Lilly, Wyeth, X-Gen added to list of companies
    posting ceiling prices
  • Partnered with national organizations
    representing covered entities to conduct
    340B-related education and compliance programs

42
PVP Participants by Entity Type (as of 7/19/07
5231 participants)
43
Supplier AgreementsSource 340B PVP website
  • Allendale Pharmaceutical
  • Alliant Pharmaceuticals
  • Astra-Zeneca Pharmaceuticals
  • Abraxis Pharmaceutical
  • Akorn Inc.
  • ASD (flu vaccine)
  • Bayer Diagnostics
  • Bedford Labs
  • Can-am Care LLC
  • Caraco Pharmaceutical Labs
  • Cytogen (pending)
  • FFF (flu vaccine)
  • GW Laboratories
  • Geritrex Corporation
  • GlaxoSmithKline
  • Hawthorne Pharmaceuticals, Inc
  • Home Diagnostics Inc.
  • Early Detect
  • Lilly Company
  • Medicure
  • Morton Grove Pharm Inc.
  • NitroMed Inc.
  • Novartis Vaccines
  • Novo Nordisk
  • Okomoto USA Inc.
  • Organon USA, Inc.
  • Paddock Labs
  • RD Plastics Co Inc.
  • Rx Elite Holdings, Inc.
  • Sandoz Pharmaceutical
  • Sciele Pharma
  • Teva Health Systems
  • Total Pharmacy Supply
  • Tri State Distribution
  • Stratus Pharmaceuticals
  • Trinity Biotech
  • X-Gen Pharmaceuticals
  • Watson Pharma Inc.

44
PVP Sub-ceiling avings by Quarter
45
DSH Inpatient Program
46
DSH Inpatient Pricing
  • Section 1002 of MMA Amended Medicaid Rebate Law
    to exclude inpatient prices from best price
    reporting by drug manufacturers
  • Program is voluntary for manufacturers
  • Exeption to GPO exclusion for inpatient -
    Contracts can be negotiated by GPO or by DSH
    independently
  • Complete and accurate lists of eligible members
    must be maintained by GPOs and pricing is
    restricted to DSH members only
  • Some hospitals report 10 or greater in added
    savings over typical GPO prices

47
SNHPA Survey ResultsDSH Inpatient Discounts
  • SNHPA survey indicates hospitals have received
    post-MMA inpatient discounts on only 12 percent
    of their most commonly used brand name drugs
  • 70 percent of the discounts were contingent on
    hospitals guaranteeing a certain market share
  • Small and rural hospitals are the least likely to
    receive inpatient discounts under Section 1002
    because of requirements placed on contracts
  • SNHPA has advocated for legislation to address
    the inpatient pricing. Members of Congress have
    introduced legislation that would mandate 340B
    pricing on DSH inpatient drugs see S.1376 and
    H.R.2606

48
Safety Net Inpatient Drug Affordability Act S
1376/ HR 2606
  • Expands 340B program to new entities
  • Permits GPO within inpatient
  • Extends discounts to inpatient
  • Credit paid to Medicaid for inpatient discounts
    based on formula
  • Modifies AMP
  • Increases OPA authority and resources for
    enforcement and improves pricing integrity
  • Permits multiple contract pharmacies
  • January 1, 2008

49
Contact Information
  • Office of Pharmacy Affairs
  • Phone 301-594-4353 or 1-800-628-6297
  • Email opastaff_at_hrsa.gov
  • Web www.hrsa.gov/opa
  • Pharmacy Services Support Center
  • Phone 1-800-628-6297
  • Email pssc_at_aphanet.org
  • Web http//pssc.aphanet.org
  • Prime Vendor Program
  • Phone 1-888-340-2787
  • Email 340b_primevendor_at_340bpvp.com
  • Web http//www.340bpvp.com
Write a Comment
User Comments (0)
About PowerShow.com