Keeping track of all the changes, or proposed changes within the Government Pricing arena can be a challenge, especially with all that is going on right now.?? The Pricing Group has summarized some of the recent updates and changes that we thought were important to share with our followers.
?Regulatory/Legislative Update
- In January, the US Supreme Court heard a case that would overturn the “Chevron Deference,” which gives federal agencies a significant amount of regulatory power to interpret laws that are ambiguous. If overturned, it would impact agencies’ authority and potentially how healthcare policies are implemented. The Harvard Gazette provides an interesting review of the issues from this case. A decision is expected in June 2024.
- The Proposed Rule from May 2023 that would require manufacturers to “stack” discounts in their determination of Best Price is rumored to be finalized in June 2024. As soon as something is released, we will let you know.
- The SUSTAIN 340B Act is a bipartisan “discussion draft” reform bill intended to add clarity, transparency, compliance, and integrity to the 340B program. Especially of interest to manufacturers, the bill:
o?? Addresses the use of contract pharmacies and manufacturer restrictions
o?? Provides clarity on patient definition and child site eligibility
o?? Requires more transparency by covered entities
o?? Establishes clearinghouse to avoid duplicate discounts
Comments are due April 1 to [email protected].
- Pharmacy Benefit Manager (PBM) reform is seeing bipartisan support in Congress as support grows for increased transparency and changes to compensation models. Many believe changing how PBMs are compensated will lower the overall cost of prescription drugs.
- In December 2023, the Biden administration issued an announcement that it may seek to apply “March In Rights” under the Bayh – Dole Act to pharmaceutical products that benefitted from federally-funded research. The hypothesis is that for drugs that may not be “reasonably” available to Americans because of the cost, the government reserves the right to “march in” and license it to another manufacturer who could sell it for less, However, critics note that the Bayh-Dole Act makes no reference to reasonable prices or controls being enforced by the federal government
- Further enforcing the Biden administration’s effort to reduce prescription drug costs to the government and Medicare beneficiaries, in the State of the Union address, and his budget proposal, President Biden proposed widening Medicare’s Drug Price Negotiation Program from the Inflation Reduction Act (IRA) to include 500 drugs over the next 10 years.
- Earlier this month, four companies who have challenged the IRA’s Drug Price Negotiation Program, requiring manufacturers of “selected drugs” to negotiate the price for drugs covered under Medicare Part D, presented arguments together. No decision has yet to be issued in that case but so far, the courts have thrown out PhRMA’s and AstraZeneca’s challenges to the program and three other cases have yet to be heard by the courts.
- Federal Supply Schedule (FSS) Industrial Funding Fee (IFF): On April 1, 2024, the Department of Veterans Affairs will launch a new website for manufacturers to report their FSS sales reporting and the associated IFF. Both reporting and payment of the IFF will now be due 30 days after quarter end. Additionally, remittance of the IFF will be via a new Sales Reporting Portal. For more information, please see the GSA’s website and the Quick StartGuide.
- Medicare Part D: In 2025, the current Coverage Gap Discount Program will be replaced by the Manufacturer Discount Program. The deadline to sign the new agreement was March 1, 2024. The Pricing Group has a P Number so if your organization failed to submit the necessary paperwork, we can allow you to “piggyback” on our agreement to ensure your products do not lose coverage. Reach out to The Pricing Group for more information. And additional information on Part D can be found at CMS’s website.
?If you would like more information on any of the above topics or how The Pricing Group helps manufacturers comply with the requirements of the federal healthcare programs, please feel free to reach out to The Pricing Group. And as always, we recommend each manufacturer determine how these changes could impact their operations and consult with their own legal counsel for specific guidance.
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