AWP,RED BOOK,MEDICARE,MEDICAID등

리베이트내용....P 17,P25

Manufacturers have the most influence over pharmaceutical prices. They develop algorithms to account for expected demand for the product, future competition for the product, and projected marketing costs, and use those algorithms to establish the “wholesale acquisition cost” (WAC), which is the baseline price at which wholesale distributors purchase products. After the WAC is established, the average wholesale price (AWP), or the retail list price, is established either by the manufacturer or by one of the companies that publishes price compendia.

The AWP, and sometimes the WAC, is listed in drug compendia published by a small number of private firms, such as the Red Book, published by Thomson Medical Economics, and First DataBank. The AWP has two purposes: (1) it is often used by public and private third-party payers as the basis for reimbursement, and (2) it often serves as the base price for negotiations between manufacturers and private sector purchasers of drugs (e.g., health plans, pharmacy benefit managers, self-insured employers, etc.).

The negotiation process and the price points on which negotiations are based are different for brand and generic manufacturers. Brand Manufacturers typically offer discounts based on a percentage of AWP or WAC, depending upon the purchaser. End purchasers can typically acquire brand drug products for a price in a range of AWP minus 5 to 40 percent, depending upon their purchasing power or that of their designated agent, such as a PBM. Generic pharmaceutical manufacturers operate in a more aggressive and dynamic negotiation environment than brand manufacturers and thus the prices for generic drugs change much more frequently, sometimes daily, in response to market forces.

The most common kinds of discounts and rebates include: retroactive rebates based on market share (i.e., rebates paid by the manufacturer to the pharmacy or PBM based on its ability to direct consumers to certain products); volume discounts (discounts that are triggered when predetermined sales volume targets are met); and “prompt pay”
discounts (discounts that are triggered when the purchaser reimburses the manufacturer in an expedited fashion)....P17


A. Special Pricing Rules Applicable to Federal Programs

Several federal programs that are significant purchasers of prescription drugs have special rules for pricing.

Medicaid

Federal rules require that states pay for brand name prescription drugs based on the lower of (1) the estimated acquisition cost (EAC) of a drug (the method most states use); or (2) the usual or customary charge to the public. Most Medicaid programs use a drug’s AWP to calculate the EAC, generally AWP minus some percentage. An additional limit, known as the Federal Upper Limit (FUL), applies to the purchase of generic drugs. Manufacturers who want to have their drugs covered by Medicaid also must provide rebates to state Medicaid programs.

For brand name drugs, the basic rebate is the larger of (1) 15.1% of the AMP (the average price paid to manufacturers by wholesalers for drugs distributed to retail pharmacies; the AMP is usually lower than the AWP); or (2) the difference between the AMP and the lowest price the manufacturer offers to most other purchasers. An additional rebate is required if the price of brand name drugs rises faster than the change in Consumer Price Index. Rebates for generic drugs are calculated by multiplying the AMP by 11%.


Department of Veterans Affairs, Department of Defense, Public Health
Service, Coast Guard

The Department of Veterans Affairs (VA) administers a program known as the Federal Supply Schedule (FSS), through which the VA and certain other
government agencies can purchase prescription drugs at prices that are equal to or lower than the prices that drug manufacturers charge their “most-favored” private customers. In addition, manufacturers must sell brand-name drugs to these agencies at a minimum of 24% off the AMP (known as the federal ceiling price).


Section 340B Drug Pricing Program

Section 340B of the Public Health Service Act requires drug manufacturers, as a condition of having their drugs covered by Medicaid, to provide prescription drugs to certain nonfederal entities (public and Disproportionate share hospitals,
community health centers, certain grantees of Federal agencies, and health centers that serve migrant, homeless, public housing, and Native American populations) at prices that are equal to or below the AMP reduced by the applicable Medicaid rebate percentage...p25