Blog Posts by Stephanie Trunk
Pursuant to the Bipartisan Budget Act of 2015, manufacturers participating in the Medicaid Drug Rebate Program must pay an Additional Discount on Non-Innovator products to the extent the Average Manufacturer Prices (“AMPs”) of their products are rising faster than inflation when compared to a base line period. However, the Centers for Medicare & Medicaid Services (“CMS”) stated in April 14, 2017 e-mail correspondence to manufacturer technical contacts listed for the Drug Data Reporting for Medicaid System (“DDR”) that DDR system updates needed to automate the Additional Discount calculation on Non-Innovator products were not finalized in time and, as such, first quarter 2017 Unit Rebate Amounts for Non-Innovator products will NOT include the calculated Additional Discount, if any.
EHR Tech Must Meet “Meaningful Use” Standards
In a notice published in the Federal Register on Friday, May 19, 2017, the Health Resources and Services Administration announced that it would further delay the effective date of a final rule applicable to all drug manufacturers participating in the 340B Drug Pricing Program.
In a Federal Register notice scheduled to be published on March 20, 2017, the Health Resources and Services Administration (HRSA) announced that it will delay the effective date of the January 5, 2017 final rule (the Final Rule) that provided guidance on the calculation of drug ceiling prices and the imposition of civil monetary penalties on certain drug manufacturers participating in the 340B Drug Pricing Program. Arent Fox’s Health Care Counsel Blog previously featured an analysis of the Final Rule, which can be found here.
In early February, the Department of Justice’s Criminal Division, Fraud Section, published a document titled, Evaluation of Corporate Compliance Programs. A must-read for any person responsible for a compliance program, regardless of industry, the document identifies common questions that DOJ may ask when making individualized determinations about a compliance program’s effectiveness. Although DOJ points out that the publication is “neither a checklist nor a formula,” the document provides practical guidance to corporations (and their attorneys) about where DOJ will focus its compliance program inquiries. And although the publication applies only to the criminal division, it may be instructive in civil fraud matters as well.
Have you been wondering what OIG has done regarding drug pricing and reimbursement since 2010? Today, OIG has made it easier to find out, posting a Drug Pricing and Reimbursement Web portfolio on its website. According to an OIG announcement, the portfolio “pulls together the HHS OIG’s body of work since 2010 as well as other relevant items that relate to drug pricing and reimbursement in HHS programs. The portfolio features planned work, completed reports, industry guidance, and enforcement actions.”
Last month, Baxter International Inc. and Baxter Healthcare Corporation (collectively “Baxter”) settled a qui tam False Claims Act (FCA) case with the Department of Justice (DOJ) for $18 million. The settlement is not monumental in terms of the amount, but does highlight the unique theory of FCA liability. The government alleged that Baxter submitted false claims for a drug sold to the Department of Veterans Affairs and Department of Defense, as well as reimbursed by the Medicare and Medicaid programs, because the drug was “adulterated,” given Baxter’s alleged violations of the Federal Food, Drug, and Cosmetic Act’s (FDCA) current good manufacturing practice (cGMP) requirements – but not because of any impact on the drug itself.
Earlier this month, FDA finalized Guidance for Industry, Assessment of Abuse Potential of Drugs. This guidance is intended to assist researchers and sponsors of new drugs that may have central nervous system (CNS) activity evaluate whether the drug has abuse potential. It provides the agency’s recommendations for timing and design of abuse-related studies, the types of studies that should be included in an abuse potential assessment submitted as part of a new drug application (NDA), and provides general recommendations for consulting with FDA about abuse potential assessment during the drug development process.
Last week, FDA issued a draft guidance, Drug and Device Manufacturer Communications with Payors, Formulary Committees, and Similar Entities – Questions and Answers, describing the Agency’s expectations for drug and device manufacturers’ communication of health care economic information (HCEI) about their products to payors, formulary committees, and “other similar entities with knowledge and expertise in the area of health care economic analysis.” What is most notable about this guidance is that FDA has taken the position that this type of information may be shared before a product has been approved.
The 340B Drug Pricing Program Ceiling Price and Manufacturer Civil Monetary Penalties final rule is scheduled to be published in the Federal Register on January 5, 2017. A link to the advance copy of the final rule can be accessed here. Arent Fox health care partner Stephanie Trunk and associate Erin Atkins will be publishing a detailed client alert soon, in which they will analyze the provisions of the final rule and how they impact 340B covered entities and participating drug manufacturers. Please stay tuned to the Health Care Counsel blog for further updates!
The US Attorney’s Office for the District of New Jersey recently announced an agreement with BioTelemetry Inc. to settle allegations that its recently-acquired subsidiary, MedNet, Inc., violated the Anti-Kickback Statue and False Claims Act by improperly inducing health care providers to use the company’s cardiac monitoring services.
Last week, FDA issued a final version of Guidance for Industry, Contract Manufacturing Arrangements for Drugs: Quality Agreements, which is available here. In this document, FDA sets forth the Agency’s expectations for parties involved in contract drug manufacturing, specifically that they delineate—in written quality agreements—each party’s roles and responsibilities to ensure compliance with FDA’s current good manufacturing practice (CGMP) requirements. The guidance applies to commercial manufacturing of human and veterinary drugs, certain combination products, biological and biotechnology products, finished products, active pharmaceutical ingredients, excipients, in-process materials and drug constituents of combination drug/device products.
On November 17, FDA announced that it had revised, and finalized in part, Guidance for Industry, Generic Drug User Fee Amendments of 2012: Questions and Answers Related to User Fee Assessments, available here.
The revised guidance finalizes the section of the document that pertains to user fees. (Note that FDA announced GDUFA user fees for fiscal year 2017 for Abbreviated New Drug Applications, Prior Approval Supplements, Drug Master Files, and facilities earlier this year (81 Fed. Reg. 49,225, July 27, 2016).) Questions and answers related to self-identification, review of generic drug submissions, and inspections and compliance, which appeared in earlier versions of this GDUFA Q&A guidance, will be updated and addressed in a separately issued final guidance.
On Monday, CMS issued a notice that, in effect, gives drug manufacturers a three-year reprieve to updating their systems to include sales in US territories in the AMP and Best Price. The government’s release about the changes that were published to Medicaid.gov can be found here.
Today, CMS issued a notice announcing changes that would be made to the Medicaid National Drug Rebate Agreement (NDRA). The government’s release about the changes that were published to Medicaid.gov can be found here:
In a ruling that could, if adopted by other courts, expose all pharmaceutical discount and rebate arrangements to anti-kickback liability, on August 23, 2016, Judge Rya Zobel in the United States District Court for the District of Massachusetts denied Omnicare, Inc.’s motion for summary judgment in United States ex rel. Banigan v.
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