Retail pharmacy can rest easy with AMP victory
WHAT IT MEANS AND WHY IT’S IMPORTANT — It’s a battle that raged for more than three years. But in mid-December, the retail pharmacy industry was able to declare a clear, unequivocal victory.
(THE NEWS: In landmark victory for retail pharmacy, feds agree to drop last AMP provisions. For the full story, click here)
We’re talking, of course, about the struggle to head off what would have been a devastating change in the way Medicaid pays community pharmacies to dispense generic drugs to low-income patients. This week, the chain and independent pharmacy lobbies announced they had reached a landmark agreement with the Centers for Medicare and Medicaid Services that effectively ends the threat.
In short, the National Association of Chain Drug Stores and the National Community Pharmacists Association refer to the proposed changes as “AMP,” which stands for “average manufacturer price.” CMS had proposed AMP as a new method for calculating the market price of generics as a new basis for establishing the federal upper limit of reimbursements to pharmacies for dispensing those generics to Medicaid patients.
CMS unveiled the new reimbursement guidelines as a way to cut Medicaid costs in line with the Deficit Reduction Act of 2006. But pharmacy leaders have long argued that it’s a flawed approach to cost-saving by the government. AMP doesn’t reflect the true acquisition cost of the generic for retail pharmacies, they argued, since it takes into account the lower costs paid by other types of purchasing entities, such as hospitals and institutions. What’s more, the feds’ definition of “multiple-source drug” itself was flawed, pharmacy advocates asserted.
Together with the low rate of markups CMS was proposing for generic Medicaid payments, the new AMP rule drastically would have cut pharmacy reimbursements and made it all but impossible to dispense medicines to low-income patients without incurring a loss, pharmacy leaders have long argued. To head off the change, NACDS and NCPA filed suit in federal district court in 2007 to halt the new AMP guidelines from taking effect.
The resulting court-imposed injunction has kept AMP from taking effect, and it has saved chain and independent pharmacies an estimated total of $5.5 million a day ever since. Now that CMS finally agreed to withdraw its reimbursement plan and go back to the drawing board, NACDS and NCPA, along with their members, are breathing a sigh of relief. The fact that they’ve also agreed to drop the suit signals the end of a long — and ultimately victorious — battle for respect, and a decent return on their business.
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FDA approves Safyral
WAYNE, N.J. — The Food and Drug Administration has approved a new oral contraceptive developed by Bayer.
Safyral is a combination of Yasmin, also developed by Bayer, with 451 mcg levomefolate calcium, which is a B vitamin known as a folate. It is the second oral contraceptive from Bayer that features folate.
"With the FDA approval of Safyral, Bayer now offers two oral contraceptives that contain folate," said Leslie North, VP women’s healthcare marketing at Bayer HealthCare Pharmaceuticals. "Safyral and Beyaz are part of Bayer’s growing women’s health franchise, and these new products reinforce our commitment to providing women various contraceptive options."
FDA declines to approve Brilinta
WILMINGTON, Del. — The Food and Drug Administration has turned down AstraZeneca’s regulatory approval application for a drug to treat heart disease, the drug maker said.
The agency sent AstraZeneca a complete response letter requesting additional analyses of data from a clinical study of Brilinta (ticagrelor), but did not request additional studies. The drug is designed to treat acute coronary syndromes.
A complete response letter means that the FDA has completed its review of a drug application, but issues remain that preclude final approval.
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