December 9, 2013—The federal government is yet again postponing final regulations for the calculation of a drug’s average manufacture price (AMP) under the Medicaid drug rebate program. [ms-protect-content id=”2799″] AMP is one of the main determinants of a drug’s 340B ceiling price.
The Office of Management and Budget (OMB), which reviews all federal agency regulations before release, recently published an updated May 2014 “final action” date for the rule, which will implement changes to AMP called for in the Affordable Care Act of 2010. The Centers for Medicare & Medicaid Services (CMS) published its proposed rule in February 2012. One year later, OMB posted a notice stating the final rule would come out in August 2013. Then, in July 2013, CMS posted a notice saying it would come out in January 2014.
In general, the 340B ceiling price is the lower of a manufacturer’s best price or:
- for brand name drugs, AMP minus 23.1 percent;
- for generic drugs, AMP minus 13 percent; and
- for hemophilia and pediatric drugs, AMP minus 17.1 percent.
Health care providers are entitled to an additional discount if a drug’s AMP has risen faster than the rate of inflation.
The final rule will also clarify the separate AMP that the Affordable Care Act created for inhalation, infusion, instilled, implanted, or injectable drugs (“5i drugs”).
On a separate front, the Health Resources and Services Administration (HRSA) has said it intends to issue a proposed comprehensive regulation for the 340B program for notice and comment in June. [/ms-protect-content]