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Hemo Alliance Newsletters

Legal Update, April 2023

Legal Update

340B Contract Pharmacy Services Agreement: Some Rules and Many Pitfalls
by Elizabeth “Issie” Karan, Legal Counsel

Controversy abounds in use of contract pharmacies in the 340B Discount Drug Pricing Program with 22 manufacturers restricting their use and/or requiring extensive data reporting from most covered entities. Luckily, and with some hard work from the Alliance team, HTCs have been exempted from these challenges. However, contract pharmacies still do not mean a free lunch. Some concrete rules exist from the 2010 Contract Pharmacy Services Guidance. Perhaps more importantly, however, is ensuring that the operational realities of the relationship work for your HTC.

The Contract Pharmacy Guidance outlines ten requirements for a Pharmacy Services Agreement (PSA) in the 340B Program. Given the long history of this guidance, most PSAs include these components. Therefore, it’s important for your legal counsel to ensure they are included but that is not the end of the story.

Operational components of PSAs should be closely reviewed. These often are codified in addenda to the agreement and describe how the program actually works. Importantly, these indicate when and how the parties will be paid. Additionally, in a virtual replenishment model, the description of operations will delineate that process for HTCs getting credit for their 340B prescriptions. HTCs should review these descriptions closely. Oftentimes, the operations will leave out concrete timelines for replenishments which could be a disadvantage for HTCs. For example, HTCs should get credit for prescriptions ordered by its program, regardless of when the contract pharmacy or its vendor actually wants to accrue those prescriptions to HTC accounts. We have heard of problems arising in the field when the pharmacy or its vendor sits on replenishments or fails to account for them entirely. This problem can significantly negatively impact the financial benefits of the relationship and may create significant work for the HTC.

HTCs have the most leverage to ensure operations work for them prior to entering into an agreement. After the agreement is signed, few incentives exist for contract pharmacies to accommodate the HTCs’ requests. Make sure you are imagining how the steps of the relationship will proceed and get the agreements reviewed by legal counsel BEFORE signing them.

Also in this Issue…

Notes from Joe
· Dateline: Orlando, Florida

Washington Update
· Reminder: Register for the June Hemophilia Alliance Hill Day!

Alliance Update
· We Need Your Help: Look for the HTC Needs Assessment

Payer Update

Notes from the Community
· The Hemophilia Alliance Foundation Update: 2023 Project/Patient Assistance Grants
· NHF – 2023 Unite for Bleeding Disorders National Walk and the HTC Wall of Walkers Challenge
· Update on FAIR Time for Women
· Webinar Announcement from the Foundation for Women and Girls with Bleeding Disorders

Team Alliance Contact Information

We work for you! Please don’t hesitate to contact any of us with any questions or concerns:

NameEmailPhone
Jeff Blakejeff@hemoalliance.org317-657-5913
Jennifer Borrillo, MSW, LCSW, MBAborrillo@hemoalliance.org504-376-5282
Jeff Amondamond@hemoalliance.org608-206-3132
Jennifer Andersjennifer@hemoalliance.org954-218-8509
Angela Blue, MBAangela@hemoalliance.org651-308-3902
Karen Bowe-Hausekaren@hemoalliance.org717-571-0266
Zack Duffyzack@hemoalliance.org503-804-2581
Michael B. GlombMGlomb@ftlf.com202-466-8960
Johanna Gray, MPAjgray@artemispolicygroup.com703-304-8111
Kiet Huynhkiet@hemoalliance.org917-362-1382
Elizabeth Karanelizabeth@karanlegalgroup.com612-202-3240
Kollet Koulianos, MBAkollet@hemoalliance.org309-397-8431
Roland P. Lamy, Jr.roland@hemoalliance.org603-491-0853
Dr. George L. Oestreich, Pharm.D., MPAgeorge@gloetal.com573-230-7075
Theresa Parkertheresa@hemoalliance.org727-688-2568
Mark Plencnermark@hemoalliance.org701-318-2910
Ellen Rikereriker@artemispolicygroup.com202-257-6670