Category — Pharmaceuticals

CMS released a letter to Part D sponsors providing guidance regarding the implementation of the Medicare Part D coverage gap discount program as it relates to generic drugs.

CMS released a letter to Part D sponsors providing draft guidance regarding the implementation of the Medicare Part D coverage gap discount program.  Although PPACA requires manufacturers to enter into agreements with CMS to provide these discounts in order for their drugs to be covered under Part D, the guidance states that because a conflict in timing–Part D sponsors were required to submit their 2011 formularies by April 2010 and CMS will not release the model manufacturer agreement until July/August–”CMS must allow coverage in 2011 of Part D drugs irrespective of manufacturer discount agreements.”

On May 21, 2010, the Internal Revenue Service (IRS) released Notice 2010-45, providing detailed guidance regarding the therapeutic discovery tax credit program established by the Patient Protection and Affordable Care Act.  The program is aimed at producing new therapies, creating jobs and advancing U.S. competitiveness.  The Notice describes the procedures that companies must follow in order to apply for a credit or a grant under the program and sets forth important filing dates for the 2009-2010 allocation round. 

Under Section 9023 of the Act, Congress created a new section 48D of the Internal Revenue Code to provide a tax credit or grant to each eligible company that makes a “qualified investment” in a “qualifying therapeutic discovery project” in the amount of 50 percent of the investment, up to a cap of $10 million.  To be eligible to participate in the program, a company with no more than 250 employees must make, or have made, such an investment in a qualifying project during 2009 or 2010. 

[Read more →]

CMS released a letter to Part D sponsors providing draft guidance regarding the implementation of the Medicare Part D coverage gap discount program.  Although PPACA requires manufacturers to enter into agreements with CMS to provide these discounts in order for their drugs to be covered under Part D, the guidance states that because a conflict in timing–Part D sponsors were required to submit their 2011 formularies by April 2010 and CMS will not release the model manufacturer agreement until July/August–”CMS must allow coverage in 2011 of Part D drugs irrespective of manufacturer discount agreements.”

CMS has issued a guidance letter on Section 2501 of the Patient Protection and Affordable Care Act and Section 1206 of the Reconciliation Act addressing “the increased rebate percentages for covered outpatient drugs dispensed to Medicaid patients, the extension of prescription drug rebates to covered outpatient drugs dispensed to enrollees of Medicaid managed care organizations (MCOs) and the rebate offset associated with the increase in the rebate percentages.” The letter describes the increase in the minimum rebate percentage for single source and innovator multiple source (brand name) drugs, with certain exceptions, from 15.1 percent of the average manufacturer price (AMP) to 23.1 percent of AMP effective January 1, 2010, as well as the extension of rebates for drugs dispensed by MCOs to Medicaid patients, and the rebate offset associated with the increase in rebates achieved via changes required in the legislation.

To read the guidance letter, click here.

CMS released a letter to Part D sponsors providing 2011 Part D Plan Benefit Package Submission and Review Instructions and addressing two provisions of PPACA and the Reconciliation:  the provisions addressing coverage for generic drugs in the coverage gap and the provision addressing costs incurred by AIDS drug assistance programs and the Indian Health Service counting toward the annual true out-of-pocket threshold under Part D.