Pink Sheet is part of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC’s registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

This copy is for your personal, non-commercial use. For high-quality copies or electronic reprints for distribution to colleagues or customers, please call +44 (0) 20 3377 3183

Printed By



Executive Summary

PHS OFFICE OF DRUG PRICING PROGRAMS WILL OVERSEE DISCOUNTS called for in legislation enacted last year. The office will be housed in the Health Resources & Services Administration's Bureau of Primary Care and will be headed by Marcia Alvarez, formerly the bureau's chief pharmacist. Deputy director will be Stephen Wickizer, a pharmacist previously with the Office of the Surgeon General. The final paperwork for the office has not been completed. The PHS office has drafted two Federal Register notices as part of implementing the law, which extends discounts to both the Veterans Affairs Department and PHS grantees ("The Pink Sheet" Nov. 9, 1992, T&G-11). The law provides that PHS-funded facilities will receive either the V-A's Federal Supply Schedule price or a discounted price at least as low as Medicaid's net rebated price. One of the upcoming regulations is aimed at preventing duplication of rebates and discounts, that is, ensuring that the drug manufacturer is not assessed a Medicaid rebate on top of the discounted clinic price when a Medicaid patient goes to a public clinic. Initial attempts to identify potential "entities" eligible for the discounts have uncovered about 9,000 organizations which may qualify, PHS said. That estimate will need fine-tuning: there appears to be duplication on the list, and many of the grantees have subgrantee health facilities that may be eligible. The Office of Drug Pricing Programs hopes to send a letter to the eligible entities by early April describing the discount program and outlining recipient responsibilities. The bulk of facilities eligible for the discounts are community health centers and migrant health centers. The office has received discount agreements from more than 450 manufacturers. The 1992 law establishes Medicaid as the enforcement mechanism, i.e., Medicaid coverage of a product would be withdrawn if a manufacturer refuses to provide the rebate requirements for either V-A or PHS grantees. V-A is indicating that it has received agreements from all manufacturers to which the department sent a contract. The law as enacted had called for all discount agreements with the V-A and PHS to be signed by Jan. 1, 1993, but the Health Care Financing Administration decided to treat that deadline as flexible since PHS had not sent its agreements out to manufacturers by that date. While V-A and HCFA health care reimbursement programs have given them experience relevant to setting up the drug rebate and discount programs, PHS had less experience in this area. As part of its effort to build upon existing procedures, the PHS has consulted with state Medicaid officers. In addition, the agency is disseminating information about the new law to associations and professional societies whose members include PHS grantees.

You may also be interested in...

Part D Discount Liability Coming Into Focus: CMS Releases Drug Cost Data

Newly released Medicare Part D data sheds light on the sales hit that branded pharmaceutical manufacturers will face when the coverage gap discount program gets under way in 2011

FDA Skin Infections Guidance Spurs Debate On Endpoint Relevance

FDA appears headed for a showdown with clinicians and the pharmaceutical industry over the proposed new clinical trial endpoints for acute bacterial skin and skin structure infections, the guidance's approach for justifying a non-inferiority margin and proposed changes in the types of patients that should be enrolled in trials

Shire Hopes To Sow Future Deals With $50M Venture Fund

Specialty drug maker Shire has quietly begun scouting deals with a brand-new $50 million venture fund, the latest of several in-house investment arms to launch with their parent company's pipelines, not profits, as the measure of their worth




Ask The Analyst

Please Note: You can also Click below Link for Ask the Analyst
Ask The Analyst

Your question has been successfully sent to the email address below and we will get back as soon as possible. my@email.address.

All fields are required.

Please make sure all fields are completed.

Please make sure you have filled out all fields

Please make sure you have filled out all fields

Please enter a valid e-mail address

Please enter a valid Phone Number

Ask your question to our analysts