NCPA Advocacy Center Update – Week Ending January 14, 2017

NCPA Asks President-elect Trump to Scrutinize Pharmacy Benefit Managers in Review of Prescription Drug Prices:  This week NCPA sent a letter to President-elect Donald J. Trump urging his Administration to examine the role pharmacy benefit managers (PBMs) play in escalating prescription drug prices. NCPA’s letter describes how these drug middlemen have evolved, growing “over the past few decades from prescription processing companies into enormous corporations that hold the key to rising prescription drug costs and operate in a virtual black box…These companies have morphed into little-regulated entities that exploit their strategic position at the ‘middle’ of nearly all drug transactions in the U.S., to extract profits from the upstream and downstream participants in the drug supply chain while providing questionable value to the ultimate consumer.” NCPA urges the Trump Administration to “closely scrutinize PBM corporations and demand much greater transparency from these entities. Cleaning up the role of PBMs is instrumental to addressing prescription drug prices.” In addition, NCPA outlined how independent community pharmacies can help reduce spending while improving health outcomes.

NCPA Supports Bill Recognizing Pharmacists as Health Care Providers:  This week NCPA endorsed S. 109, the Pharmacy and Medically Underserved Areas Enhancement Act, which was introduced by U.S. Sens. Charles Grassley (R-Iowa), Robert Casey (D-Pa.) and Sherrod Brown (D-Ohio). The bill recognizes pharmacists as health care providers and permits state-licensed pharmacists in medically underserved communities to both provide and be reimbursed for an expanded scope of patient-care services under the Medicare Part B program.  S. 109 has 27 original cosponsors and is identical to S. 314 from the 114th Congress, which was cosponsored by more than half the Senate.NCPA is a part of the Patient Access to Pharmacists’ Care Coalition (PAPCC)—a group of more than 20 organizations representing patients, pharmacists, and pharmacies, as well as other interested stakeholders—dedicated to ensuring the full capabilities of pharmacists are recognized and compensated.

NCPA Reacts to Court of Appeals Ruling on Iowa PBM Reform Law:  This week the U.S. Court of Appeals for the Eight Circuit issued a ruling in Pharmaceutical Care Management Association v. Gerhart case. In response NCPA issued the following statement: “Today, the U.S. Court of Appeals for the Eighth Circuit issued a decision holding that ERISA preempts an Iowa statute that sought to impose common-sense regulations upon Pharmacy Benefit Managers (PBMs).  See Pharm. Care Mgmt. Ass’n v. Gerhart, No. 15-3292 (8th Cir.). Although NCPA continues to study the decision, it is deeply disappointed with the outcome.  The Iowa law was meant to ensure that Iowans continue to have fair access to their prescription drug benefits and bring transparency to a PBM industry that has exploited secrecy to reap record profits at the expense of hardworking Americans.“The lawsuit itself involved a dispute between PCMA, the PBMs’ trade association, and the State of Iowa, but NCPA worked to protect NCPA members’ interests by filing a friend-of-the-court brief with the Eighth Circuit explaining the virtues of the Iowa statute—a point that the court did not dispute—and why it was not preempted by ERISA.  NCPA will continue to study the decision and determine how best to respond on behalf of its members.

NCPA, NACDS Laud Enactment of TRICARE Pilot in Defense Bill: We were very pleased to join NACDS last month in thanking the Senate and House Armed Services Committees for including the TRICARE Acquisition Cost Parity Pilot Program for Retail Pharmacy in the FY 2017 National Defense Authorization Act.  This pilot program, if implemented by the Secretary, would preserve freedom of choice for beneficiaries, improve access by utilizing retail pharmacies in urban and rural areas, and provide more clarity to beneficiaries as to where to fill prescriptions.

FDA Releases Additional Compounding Guidance Documents:  This week FDA released a final guidance addressing the repackaging of certain human drug products by pharmacies and outsourcing facilities. In the guidance, FDA lays out the situations where it does not intend to enforce certain federal regulations with regard to repackaging drugs by state-licensed pharmacies, federal facilities or registered outsourcing facilities. The guidance also clarifies FDA’s definition of repackaging to mean “the act of taking a finished drug product from the container in which it was distributed by the original manufacturer and placing it into a different container without further manipulation of the drug.” While FDA says that repackaged drugs are “generally not exempt from any of the provisions of the [Food, Drug, and Cosmetic Act] FD&C Act related to the production of drugs,” the agency does not intend to enforce these provisions against state-licensed pharmacies, federal facilities or outsourcing facilities as long as they meet the criteria set out in the guidance. NCPA had previously relayed a host of concerns with the draft guidance to FDA especially in regards to long term care pharmacy repackaging practices. Fortunately the FDA heard our concerns and states within the guidance that for the meantime FDA does not intend to address non-sterile drug products repackaged by State-licensed pharmacies for use in long-term care facilities and will instead revise the guidance or issues separate guidance to address this issue.   The FDA also announced revisions to a previous final guidance document addressing 503A bulk drug substances and released the following compounding progress report: FDA’S Human Drug Compounding Progress Report: Three Years After the Enactment of the Drug Quality and Security Act.

DMEPOS Suppliers Must Use Revised CMS-855S Application: Starting December 31, 2016,  suppliers must use this revision of the CMS 855S that simplifies and clarifies the current data collection and removes obsolete and/or redundant data collection. Limited informational text has been added within the application form. In addition, links to websites are added to provide helpful instructions when greater detail is needed by the supplier, for example: the “Process to Obtain Medicare Approval” section of the instructions added the application fee and fingerprinting requirements, complete with website links and a telephone number for additional information.  CMS added a website offering guidance on DMEPOS supplier licensure requirements in Section 2. Please find further info here:

HRSA Releases 340B Ceiling Price and CMP Final Rule:  On January 5, the Health Resources and Services Administration (HRSA) released its Final Rule regarding the calculation of the 340B ceiling price and the imposition of civil monetary penalties (CMPs) on manufacturers that knowing and intentionally overcharge covered entities. The final rule grants the OIG authority to impose sanctions of up to $5,000 per occurrence of knowingly and intentionally charging a covered entity a 340B drug that exceeds the ceiling price. Additionally, manufacturers will be required to refund entities within 120 days of determining that an overcharge has occurred.  The ability to impose civil monetary penalties will give the government a strong enforcement tool to ensure that manufacturers are charging covered entities appropriately, and suggests that manufacturers can expect more rigorous oversight of the 340B Program in the future.  The final rule will be effective March 6, however, HRSA plans to begin enforcing the requirements on April 1 as ceiling prices are set on a quarterly basis.

In the States: 

  • Ohio: S.B. 319 was signed into law by Governor Kasich. S.B. 319 creates a regulatory structure for pharmacy technicians, and makes more significant strides in curbing prescription drug abuse. Additionally, The Ohio Pharmacists Association’s tireless efforts helped in adding plan sponsor disclosure language to the bill that will strengthen Ohio’s MAC transparency laws.
  • Ohio: S.B. 332 was signed into law by Governor Kasich. S.B. 332 expands pharmacists’ scope of practice into long-acting injectable drug administration. This bill allows pharmacists (under a physician protocol) to administer long-acting antipsychotics, opioid antagonists, progesterone, contraception, and vitamin B12. NCPA applauds the Ohio Pharmacists Association on their hard work.
  • Oregon: H.B. 2388 was introduced and it would require a PBM to register with the Department of Consumer and Business Services and annually renew the registration.
  • New Mexico: S.B.77 was pre-filed and attempts to prohibit PBMs from charging or holding a pharmacist or pharmacy responsible for any fee that is not present at the time of claim adjudication.
  • Illinois: H.B. 239 was introduced and would require drug manufactures of brand and generic prescriptions drugs to notify state purchasers, health insurers, health care service plan providers, PBMs, and the general assembly 60 days before such an increase occurs.
  • Nebraska: L.B. 324 was introduced and covers many issues important to community pharmacy. It would require a PBM to register as Third Party Administrator, attempts to prohibit DIR fees, requires notification if there is a price increase or decrease in a prescription drug, prohibits a PBM from charging a covered individual more for not using mail-order, and it includes generic drug pricing transparency language as well as an fair audit provision.
  • New Hampshire: HB 455 would prohibit and PBM from requiring additional accreditation or credentialing or providers other than the requirement of the NHBOP.