#GPSummit14: Day 3

Our live coverage from IIR's 6th Annual Government Programs Summit has been provided by Katie Lapins, Director, Huron Consulting Group and Lori Greene, Manager, Huron Consulting Group . 

It is the last day of IIR’s GP Summit with a focus on the 340B Program and it was well worth it to stick around.  Commander Krista Pedley, from the Office of Pharmacy Affairs (“OPA”), took us through the recent audits of Covered Entities (“CEs”).  Of significance is the number of CEs found to be requesting a Medicaid rebate for product purchased through the 340B program (“duplicate discounts”) and those diverting product purchased at the 340B discount for inpatient utilization (“diversion”).  Full audit results will soon be up on the OPA website along with the correction plans to be implemented by the CEs and CEs found to be violating terms of their agreements are required to submit their corrective action plan within 60 days of the findings or they face exclusion from the 340B program.

On the manufacturer side, the OPA is conducting its first manufacturer audit and is also developing documentation to assist manufacturers in their preparations for an OPA audit.  Manufacturers such as Daiichi Sankyo and Pfizer shared their experience in identifying duplicate payments and as Ed McAdam from Daiichi Sankyo stated, there is no silver bullet to fix this issue, but is a worthwhile investment for manufacturers to audit 340B transactions at least twice a year.  Not doing so means manufacturers could be “leaving money on the table.”  Identifying duplicate discounts and diversion may require a significant effort on behalf of the manufacturer, including the purchase of third party data in some instances, but the return on investment for many manufacturers has been worth it.

One other recent area getting additional attention is Gross-to-Net which was covered by Ankur Bansal from Alliance Life Science.   Bansal walked attendees through optimizing Gross-to-Net to help with accurately project Best Price the impacts of Medicaid liability.  With price increases, many manufacturers plot out the Best Price for three to five years and project sales by customer.  Pricing strategy teams that include marketing, contracting, brand management, and government pricing, can be important for manufacturers to fully understand the impact of price changes.  A price increase or decrease will usually have an impact on some, if not all, of the government price points, therefore, all price changes should include a comprehensive review, customer-by-customer and product-by-product, to understand the overall effect of the price change.  Ultimately, manufacturers want to find the “sweet spot” where revenues from both the commercial and government businesses are maximized.

As always, the IIR GP Summit was a success and we look forward to seeing you at MDRP in September and next year's GP Summit.

#GPSummit14: More from day 2

Our live coverage from IIR's 6th Annual Government Programs Summit has been provided by Katie Lapins, Director, Huron Consulting Group and Lori Greene, Manager, Huron Consulting Group . 

The theme around the afternoon sessions at this year’s GPSummit was documentation, documentation, documentation!!  The operational complexities when the Final Rule is published can be minimized tremendously if you have good documentation around your assumptions and processes.  One panel, led by Michael Panicaro from Revitas, focused on how manufacturers should be addressing their internal business objectives while developing an approach to identify the potential impacts of the Final Rule.  This session provided thoughtful insight as to how manufacturers should be preparing for the Final Rule and regardless of an organization’s size, how many products are currently marketed, or what is in the pipeline, every manufacturer will be affected.

Based on input from the conference attendees, most manufacturers have begun looking at what the Proposed Rule means to their organization, but few had gone as far as pulling data for modeling “what if” scenarios or advising other departments that could be impacted by the changes.  Most attendees expressed the opinion that CMS would issue the Final Rule by the end of May 2014, but a few others felt that it might be later in 2014.    As always there are going to be differences between what is in the Proposed Rule versus the Final Rule and interpretations and assumptions, especially before any additional guidance is issued, should always be documented.  Another point raised was that it is important that any assumptions or interpretations be consistent.  And of course, manufacturers should contact vendors to ensure that any system that provides data for the GP calculations, or performs the GP calculations, will be able to comply with the necessary changes and within the requisite time period. 

Food for thought…. One company in attendance has broken out the Proposed Rule into buckets.  For instance, with the possible expanded definition of “States” to include US Territories, which were previously excluded from the calculation of AMP and Best Price, the company located all of the data, entered it into their GP system, and analyzed the impact of the change to their numbers.  The biggest challenge for this company was locating where all of the data resided.

Tomorrow is another packed day focused on the 340B Program.  Of special note is the session with Commander Krista Pedley who oversees the Program.

#GPSummit14: Day 2

Our live coverage from IIR's 6th Annual Government Programs Summit has been provided by Katie Lapins, Director, Huron Consulting Group and Lori Greene, Manager, Huron Consulting Group . 

Mike Borgia of Johnson & Johnson HealthCare Systems chaired the second day of the GP Summit and started the morning off by providing some insight gained over his last 30 years in the pharmaceutical and healthcare industries, including recent events like the Health Exchanges, coverage changes in Medicaid and Medicare, and Alternative Benefit Plans (“ABPs”) which offer a more narrow benefit that is similar to the health insurance marketplace.

The keynote address was given by Stan Dorn, Senior Fellow at the Health Policy Center of the Urban Institute (“Urban Institute”), and focused on the impact of Medicaid expansion on state budgets and state economic growth. Much to the surprise of many people, prior to the Affordable Care Act (“ACA”), Medicaid did not cover the majority of poor people in the U.S. This changed with the ACA and the states were given a lot of flexibility in how they accomplish this. As of late October 2013, 25 states and the District of Columbia are expanding Medicaid, 25 states are not. The Urban Institute simulated a model like the ones used by the Congressional Budget Office (“CBO”) and the U.S. Treasury Department (“Treasury”) to predict the effects of Medicaid expansion policies, exchange tax credits, and costs. Generally speaking, their results were similar to those of the CBO and Treasury. One key finding was that for many states not expanding Medicaid, especially those in the South, if they had done so, although they would have had an additional cost associated with the expansion, the amount they received in Federal funds would have more than offset the additional cost. The effects of Medicaid expansion include:

• Fewer uninsured residents;
• More federal Medicaid dollars;
• Significant effects on provide infrastructure (e.g., increased revenue offsets reimbursement cuts, taxes and fees used to fund ACA);
• Increased Medicaid enrollment raises state costs; but,
• Significant offsetting state fiscal gains are realized (e.g., savings from higher federal matching payments for some pre-ACA Medicaid eligibility groups, savings on non-Medicaid state healthcare spending, increased general and specific revenue).

So why have some states opted to not expand Medicaid? According to Dorn, in some states, the political impact to the incumbent elected officials would be detrimental.

Mergers, acquisitions, and the role of the GP professional in the pharmaceutical industry was the topic for the first panel discussion of the day. If you have been around the industry for any length of time, you are probably aware of the frequency with which drugs are sold to other companies, and the trend of mergers and acquisitions of product portfolios and entire companies. Historically, the GP component has been an afterthought in these types of events but in recent years, the GP function is becoming involved in the analysis and earlier in the process. Important considerations include not only the operational aspect (e.g., consistent methodology, data and system integration, and capacity and resources), but also the financial impact (e.g., baseline AMP, price changes and the impact of the inflation penalty on Medicaid rebates, PHS & FSS prices, commercial rebates, and reimbursement). Understanding the reason for the acquisition is often an important consideration. Is the goal to expand into a new therapeutic area, build a commercial operation, enter the U.S. market, or does management believe the product offers potential revenue opportunities not previously realized?

A second panel discussed the recent developments and impact of the split between Managed Care (“MCO”) Medicaid and Fee-for-Service Medicaid. With the ACA, some states have been shifting their prescription coverage to MCO Medicaid which was anticipated by the ACA. However, many states have continued with Preferred Drug Lists (“PDLs”) which was not anticipated. The primary reason provided is that Supplemental Rebates are not paid on the MCO Medicaid utilization.

The morning sessions on this second day were full of great insight, analysis, and opinions from a wide range of experts with significant experience in the U.S. healthcare system and Government Programs in particular.

Stay tuned for more coverage from day 2!

#GPSummit14: Day 1 Highlights (part 2)

Our live coverage from IIR's 6th Annual Government Programs Summit has been provided by Katie Lapins, Director, Huron Consulting Group and Lori Greene, Manager, Huron Consulting Group. 

Today is the first day of a three day conference for the 2014 IIR Government Programs Summit held in Alexandria, VA. The conference began with two workshops that addressed the Fundamentals in Government Programs and Pricing and Advance GP Forum and taking in consideration of the Final Rule.

The agenda for Fundamentals in Government Programs and Pricing started off with the overview of the "Current Government Pricing Landscape," by John Shakow, Partner, King & Spalding. This session was a nice overview on what drug manufacturers must do to comply with the different government program regulations and guidance. In addition to the other sessions already mentioned, attendees heard more about the differences between branded and generic products, Medicaid Supplemental Contracts, and , and what “compliance” means within the GP arena. Throughout the workshop, industry representatives provided their perspective on managing a GP department and the amount operational resources that should be taken in consideration.

The workshop also touched on the much anticipated Final Rule, expected to be released May 2014, and how manufacturers will be challenged to implement and comply with the changes. Presenters John Shakow and Miree Lee expressed their thoughts that once the CMS publishes the Final Rule, manufacturers will have approximately three to six months to implement the changes and that CMS might even include a staggered implementation.

Stay tuned tomorrow for there is another packed day full of great information.

#GPSummit14: Highlights from Day 1

Our live coverage from IIR's 6th Annual Government Programs Summit has been provided by Katie Lapins, Director, Huron Consulting Group and Lori Greene, Manager, Huron Consulting Group .

What a great day at this year’s GP Summit!  There were two symposia that attendees were able to select from: “Fundamentals in Government Programs and Pricing,” and “Advanced GP Forum.”  For those newer to the GP space or needing a refresher, the “Fundamentals” track offered a great overview of the current GP landscape including Medicaid, the Public Health Service (“PHS” or “340B”) Program, and the Federal Supply Schedule.  Included was a great session by Miree Lee about all of the various acronyms those in the GP space encounter: WAC, AWP, AMP, ASP, BP, PHS, FSS, FCP, NFAMP, AAC, MAC, etc.  While it might make one’s head spin, this session helped clarify their meaning, how they are calculated, and how they are used.

Each year, the GP Summit provides a unique opportunity for manufacturers to have an informal discussion on the latest “hot” topics and that was covered by the second track.  This year, some of the topics included the potential impact changes associated with the Affordable Care Act (“ACA”), the recent PHS/340B Program developments, and bona fide service fee assessments.  Manufacturers have been waiting for four years for a Final Rule associated with the ACA and the impact of potential changes, especially those that were included in the Proposed Rule, were reviewed and discussed.  This session used a panel format and was very interactive with the audience, allowing for interesting discussions about important topics including the “build up” methodology, “5I” product determination/methodology, audits/assessments, and fair market value when evaluating payments to customers.

Both tracks provided great learning opportunities for participants at all levels and if they are an indicator as to what to expect over the next two days, we’re in for a great conference!

Stay tuned for more highlights from day 1!

Kick-off March Madness with Slam Dunk Savings from the GP Team

To celebrate March Madness, we're throwing a Government Programs Summit sale!

For the next two days, we're offering you and a colleague - a chance to attend the event in Alexandria, VA on a BOGO 50% offer! 

How can you take advantage of this offer? Email register@iirusa.com with your full contact information and the code XP1951BOGO* to receive the discount. This limited-time offer expires Friday, March 21, 2014 at 11:59PM ET.

Government Programs Summit will take place March 26-28, 2014 in Alexandria, VA. Download the agenda if you'd like to know more about the program. If you have any questions, reach out to Kate Devery at kdevery@iirusa.com.

Rules and Regulations Apply: 
• This offer is not eligible for the Government, Hospitals or Covered Entity Rates or the 340B All Day Workshop Only Rate 
• This offer only applies to passes purchased on Wednesday, March 20th and Thursday, March 21st w/ priority code XP1951BOGO
• This is a non-transferable offer and cannot be retroactively applied nor combined with other offers, discounts or promotions. Offer only valid between March 20-21, 2014.

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