Apexus’ 340B Update
14th Annual NPPA Conference
John Barnes, C.P.M.
Director, National Contracts
340B Prime Vendor Program
Apexus Inc. Irving, Texas
Thursday, August 12, 2010
The MGM Grand, Las Vegas
Objectives
• Verbalize an overview (basic rules) of the
340B Drug Pricing Program
• Define 340B expansion cited in health reform
(PPACA)
• Explain the new 340B integrity provisions
• Describe the Prime Vendor Program’s
strategic initiatives and interaction to health
reform provisions
340B Program Administration
• The 340B Program Team:
– HRSA’s Office of Pharmacy Affairs
– Pharmacy Services
Support Center
(PSSC/PharmTA)
– 340B PVP Prime Vendor
Program (Apexus Inc.)
340B Drug Program Overview
• Section 340B of the Public Health Service
Act
• Provides discounts on outpatient drugs to
certain safety-net covered entities
• Estimated six billion dollars in 340B drug
purchases last year
• Manufacturers that participate in Medicaid
must also participate in the 340B Program
Program Benefits
• The 340B Drug Program average savings of 2550% on outpatient drug purchases for 340B
covered entities on >20,000 NDC’s
• The 340B Prime Vendor offers additional
savings of 15% on over 3,500 NDC’s
• Savings may be used to:
— Reduce price of pharmaceuticals for patients
— Expand services offered to patients
— Provide services to more patient
Health Care Reform
• Affordable Care Act - P.L. 111-148
(signed into law on March 23, 2010)
— The expansion of and increase in access
to the 340B Program (sec 7101)
• Health Care and Education
Reconciliation Act of 2010 - P.L. 111-152
(signed into law on March 30, 2010)
— Exclusion of Orphan Drugs for certain
Covered Entities (Sec 2302)
New Eligible Program Types
Covered Entity Type
Code Statutory Definition
Critical Access Hospitals
Rural Referral Centers
Sole Community
Hospitals
CAH 1820 (c)(2) of SSA
RRC 1886(d)(5)(C)(i) of SSA
SCH 1886(d)(5)(C)(iii) of SSA
Free Standing Cancer
Hospitals
Children's Hospitals
CAN
1886 (d)(1)(B)(v) of SSA
PED
1886 (d)(1)(B)(iii) of SSA
OPA website: www.HRSA.gov/OPA
Eligibility Requirements
• Verifiable designation/ Valid Medicare provider
number
• A hospital must meet one of the following
criteria:
i. is a private non-profit hospital under contract
with state or local government; OR
ii. is owned or operated by a unit of state or local
government; OR
iii. is a public or private non-profit corporation
which is formally granted governmental powers
by a unit of state or local government
Eligibility Criteria
• Eligible Disproportionate Share (DSH)
adjustment percentage
— Must meet the proposed levels outlined in the
legislation for the most recent cost reporting
period

Does NOT apply to Critical Access Hospitals
• Group Purchasing Organization (GPO)
Exclusion: (applicable to)
— Free Standing Cancer Hospitals
— Children’s Hospitals and all DSH
Summary of Criteria for Hospitals
Covered Entity Type
Non
DSH %
profit/
Gvt.
Contract
GPO
Orphan
Exclusion Drug
Rule
Critical Access Hospitals
Yes
No
No
Yes
Rural Referral Centers
Yes
≥ 8%
No
Yes
Sole Community Hospitals
Yes
≥ 8%
No
Yes
Free Standing Cancer
Hosp.
Yes
≥ 11.75%
Yes
Yes
Children's Hospitals
Yes
≥ 11.75%
Yes
Yes
Disproportionate Share
Hospitals
Yes
≥ 11.75%
Yes
No
New Entity Enrollment
• Enrollment start date: August 2, 2010
• Rolling admission starting on August 2, 2010
• Please remember this will only be in effect for the first
quarter of eligibility. Entities would then be eligible for
participation on January 1, 2011.
DEADLINES- Completed application must be received 1 month
before the start of the quarter
Program Prohibitions
• Diversion
— Drug provided to individuals who are not patients
— Drug dispensed in an area of a larger facility that is
an integral part of the eligible and participating
entity (e.g. an inpatient service, a non-covered clinic)
• Duplicate Discounts
— Accessing the 340B Discount + Medicaid Rebate on
same drug
— Covered Entities must report Medicaid billing status
— www.hrsa.gov/opa/medicaidexclusion.htm
Program Requirements
• Auditable Records
— Covered entities must maintain auditable records
that demonstrate compliance with all Program
requirements
— Subject to audit by the government or
manufacturers
• Ongoing Eligibility
— Covered entities must immediately notify OPA in
the event of any change in eligibility, location,
operating status, and authorizing official/contacts.
Contract Pharmacy Services
• The Covered Entity purchases the drug, but
“ship to bill to” procedure may be used.
• The Covered Entity retains legal title to all
drugs purchased under 340B. The Covered
Entity MUST pay for all 340B drugs.
• The contract pharmacy is subject to audits
to identify and prevent diversion and/or
duplicate discount.
New Integrity Provisions
• Covered entities to have access to verified list of
340B ceiling prices via OPA website (OPA/PVP)
• OPA to develop system to determine accurate pricing
by auditing sales transactions and ensuring
corrective action (OPA/PVP)
• Covered entities required to update contact
information annually (OPA/PSSC)
• OPA to develop guidance on billing Medicaid
(OPA/PSSC)
• OPA granted additional authorities to fine CE’s for
intentional violations (OPA)
• OPA to develop procedure for manufactures to return
overcharges to entities (OPA/PVP)
Health Center Expansion
• Three areas of focus - $11B over 5 years
– Expands number of sites and locations
– Supports expanded health-care services
• Oral/dental & mental health
– Supports construction & renovation projects
– 19 million patients/year
– 1,100 grantees (FQHC) – 7,900 actual sites
Apexus – Strategic Initiatives
Mission: Apexus leverages its unique purchasing power
and expertise to deliver value which helps eligible health
care and public service organizations to access unmatched
savings and optimize performance
Strategic Initiatives 2010:
1. Increase Value to PVP Participants
2. Increase Participant Loyalty
3. Meet the Evolving Needs of HRSA
4. Continuously Improve Wholesaler, Supplier, and
Partnering Organization Relationships
Summary of 2009 Accomplishments
• Re-awarded HRSA’s Prime Vendor Agreement
• 23% increase in participants
• Overall customer satisfaction improved to 85%
• Over $30 million in participant savings
• Lost savings/recovery = $1.3 million
• $3 million shareback in 2009; $4.5 million announced
for 2010 (Over 1700 entities)
• Sub-ceiling priced pharmaceuticals covering 204 AHFS
Therapeutic Classes (61%)
• Improved technical assistance via new tutorial and
webinar offerings
• New on-line enrollment
Key PVP Contracts
• Abbott – Ultane, Simcor, Humira,
Diabetic meters/strips
• Astellas – Lexiscan
• AstraZeneca – Crestor,
Seroquel XR, Symbicort
• HDI – Diabetic supplies
• Lilly – Zyprexa, Cymbalta,
Symbyax
• Merck – Vaccines and
women’s health
• Bayer – Mirena, diabetic supplies
• Pfizer - Protonix, Xyntha
• Bedford – Injectables
• Sandoz – Injectables
• CSL Behring – Hemophilia
• Sanofi – vaccines
Products
• Eisai – Aloxi, Dacogen
• GSK – vaccines, respiratory
products, and Epzicom
• Teva – Injectables
• Sanofi – Vaccines
• Watson – multisource orals
Other Outpatient Rx Products and
Services
• Vaccines – Hep A, Hep B, Flu (multiple sources)
• Split billing solutions
• Patient assistance program Software
• Auditing and overcharge recovery services
• Prescription vials/labels/printer cartridges
• Diabetic supplies – meters, strips and syringes
• Outpatient Rx technology and automation – ScriptPro,
Automed, Innovation, VoiceTech, others
• Contract pharmacy solutions – SunRx
• Spend optimization/revenue recovery – Esi Inc.
• Apothecary supplies
• Reverse distribution (pharmacy returns)
Bid (IFB)
Number
IFB3010
IFB Description
Products
Diskus; Spiriva HandiHaler; Symbicort
Tysabri; Rebif; Avonex; Extavia; Copaxone;
IFB3016
Indication
Immunomodulators for Multiple
Sclerosis Indication
Bisphosphonates for
Postmenopausal Indication
Hematopoietic Agents –
Erythropoiesis-stimulating Agents
Hematopoietic Agents – Colony
Stimulating Factors
Hepatitis B (CMV) End-Organ
Disease
Hepatitis C
IFB3017
Oral Contraceptives
IFB3018
Heparin and Saline Flush Syringes
Tyzeka; Baraclude; Hepsera; Viread; Epivir HBV; Pegasys;
Intron-A; Peg-Intron
Monophasic; Monophasic Low; Monophasic Ultra Low;
Biphasic; Multiphasic; Extended Cycle; Progestin Only;
Injectable DMPA; Transdermal; Emergency
Heparin vials and syringes; Saline vials and syringes
IFB3019
Glucagon-like Peptide Receptors
Victoza; Byetta
IFB3020
Phosphodiestearase Type 5
inhibitors
Antibiotics – Fluoroquinolones
Cialis; Lavitra; Viagra
2010
Apexus PVP Bids
Bronchodilators for COPD
Advair Diskus; Brovana; Foradil; Perforomist; Serevent
IFB3011
IFB3012
IFB3013
IFB3014
IFB3015
IFB3021
Actonel; Boniva; Fosamax; Reclast
Aranesp; Epogen; Procrit; Leukine
Pegfilgrastim; Filgrastim
Valcyte; Cytovene; Foscarnet; Vistide
Moxifloxacin (Avelox); Ciprofloxacin (Cipro); Levofloxacin
(Levaquin); Ofloxacin
PVP Savings by Entity Type
Market Segment Secure Website
Optimize 340B Savings
Drug price
forecasts and
other budgeting
tools
– Best Buy by Therapeutic
Class Report
– Best Buy by Chemical
Compound
– Best Buy for Over-theCounter Medication
Feedback Leading to New Reports
and Service Offerings
• New reports on secure website (Q4, 2010)
• Expanded PVP portfolio on non-340B drugs
• Expanded PVP generics portfolio for DSH
• Reviewing solutions for Medicaid Carve-out
340B Related Information Resources
• Affordable Care Act
http://www.healthreform.gov
• Medicaid Exclusion
http://www.hrsa.gov/opa/medicaidexclusion.htm
• Children’s/Free Standing Cancer Hospitals
http://www.hrsa.gov/opa/children.htm
• Orphan Drug listing
http://www.accessdata.fda.gov/scripts/opdlisting/oopd
• Contract Pharmacy
http://www.hrsa.gov/opa/contractpharmacy.htm
Contact Information
Office of Pharmacy Affairs
Phone: 301-594-4353 or 1-800-628-6297
Email: opastaff@hrsa.gov
Web: www.hrsa.gov/opa
HRSA Pharmacy Services Support Center (APhA)
Phone: 1-800-628-6297
Email: lscholz@aphanet.org
Web: http://pssc.aphanet.org
Prime Vendor Program (Apexus)
Phone: 1-888-340-2787
Email: chatwig@340bpvp.com
Web: http://www.340bpvp.com