Post on 29-Mar-2018
340B and Specialty Pharmacy
340B and Specialty Pharmacy
Learning Objectives:
• Describe the history, intent and statutory principals of the 340B program.
• Outline the process for addressing 340B policy and the maintenance of integrity of the 340B Program participation.
• What are the current trends in 340B and specialty pharmacies.
• Identify the roles and responsibilities of 340B implementation.
340B Drug Pricing Program
• Established by Section 602 of the Veterans Health Care Act of
1992
• Enables “Covered Entities” to receive discounts on drug
purchases
• Requires drug manufacturers to provide outpatient drug
discounts to certain Covered Entities and to participate in other
government programs such as Medicare/Medicaid
• Not subsidized by the federal government
340B Program Status and Growth
• 28,000 Covered Entities and Child Sites*
• 50,000 Contract Pharmacy Arrangements*
• 900 Manufacturers Participating
• Many 340B Software Vendors/Administrators
* Office of Pharmacy Affairs Database, http://www.hrsa.gov/opa
Which patients are considered eligible under 340B?
• HRSA current requirements for patients:
– Has an established relationship with the covered entity
– Patient’s medical records maintained by the covered entity
– Receives health care services from professionals who are either
employed by or under contract or arrangement with the covered entity
• HRSA is currently redefining the definition of eligible patient.
• The uninsured and underinsured patients have the most potential
benefit under the 340B program, however, there is no financial
means testing, or exclusion for insured patients.
Contract Pharmacy Services
• The Covered Entity retains legal title to all drugs purchased
under 340B.
• The Covered Entity must pay for all 340B drugs, but a “ship to-
bill to” arrangement may be used.
• The contract pharmacy is subject to audits to identify and
prevent diversion and/or duplicate discount.
• As of 2010, Covered Entities can contract with multiple
pharmacies.
340B Administrators
• Solutions available to Covered Entities for administrating the
340B program:
– Traditional pharmacy-based solution
• Separate 340B inventory managed at pharmacy but owned by the
Covered Entity
– Third party administrator solution
• Eligible patients are seen at the Covered Entity under a PBM model
– Post review solution
• Audits all claims processed at contracted pharmacy against the CPT
• Diagnostic codes billed by the Covered Entity
Current 340B Challenges
• Increase scrutiny by Congress
• Focus on program oversight and integrity provisions
• Disagreements surrounding intent of program (patient subsidy vs. covered entity subsidy)
• Focus on use of program savings or “revenue” – Profiteering?
• Impact on drug shortages
• Pointed letters to hospitals and Walgreens
• PhRMA, PBMs, and Oncologists have raised concerns about program scale and patient benefit
• AIR 340B
• Negative editorials in national publications
• White Paper, “Unfulfilled Expectations…”
340B Policy Focus
• 340B “Mega-Reg”
• Eligible Patient Definition
• Contract Pharmacy
• Hospital Eligibility
• Off-site Facility Eligibility
• Date of rule publication and impact in question due to…
• PhRMA vs US DHHS
• May 2014 ruling by US District Court in favor of PhRMA
• Ruling states that HRSA does not have authority to create the orphan drug regulation published in Fall 2013
• Impact on Mega-Reg?
• Impact on previous program guidance?
340B Specialty Pharmacy
• Tend to be high volume, low margin
• Flexibility is key point to win/lose in this game
• Future legislative / regulatory / technology developments will determine viability of existing players
Definition of Specialty
• Focus on:
• Specific Diseases
• Specific Dollars
• Specific Patient Needs
• Specific System Needs
• 340B Specialty is simply an subset of these with heightened pharmacy business requirements, keeping patient & office care experiences intact
340B Scenarios
• Vary Widely
• Many different Covered Entity formats
• Many different population requirements
• Must contract & design according to each unique scenario
• Traditional payor contracts may not support patient care scenarios & vice versa
340B Implementation
• Prevent Diversion
• Inventory Management
• Virtual vs physical
• Reporting
• Ensure valid participation
• Contracting
• With Covered Entities
• With Payors/Networks
340B Implementation
• Cost containment/design for pharmacy
• Considerations:
• Payor Audits
• Reverse Logistics
• Limited Distribution
• Restricted Networks
• Dynamic patient coverage
• Carve Out Services
340B Implementation
• Does my technology support the business design? patient care design?
• Does my facility & workflow support the business design? patient care design?
• How do we keep the intent of the program intact?
• Does my physical inventory management system support 340B in forward & reverse logistics
Trends for 2015
• Drug Launches
• Limited Distribution growth or transfer in Specialty
• More HRSA and manufacturer audits
• Covered entities’ continued investment in compliance
• Continued aggregation of contract pharmacies
Trends for 2015
• Additional guidance from HRSA on patient definition and the prevention of duplicate discounts
• Continued Congressional interest
• Proposed regulations
• Calculation of 340B ceiling prices and manufacturer civil monetary penalties
• Dispute resolution
Discussion & Questions
Thank You!
Robert Tinsley
VP, Pharmacy Services
Independent Pharmacy Cooperative
800-755-1531 ext. 4856
Rob.Tinsley@ipcrx.com
Timothy Davis, PharmD
President & COO
PANTHERx Specialty Pharmacy
1-855-726-8479
tdavis@pantherspecialty.com
Contact Information: