2019 Ryan White HIV/AIDS Program CLINICAL CONFERENCE

U.S. Drug Pricing: It’s Complicated

AverageWholesale Price (AWP)

WholesaleAcquisition Cost (WAC)

NonfederalAverageManufacturer Price (Non-FAMP)

AverageManufacturer Price (AMP)

Private sectorprices

BestPrice

24%ofnon-FAMP plus additional discounts

Negotiationonmost-favored commercial customerprice

Unit rebate:23.1% /13%ofAMPor AMP–BestPriceplus CPI penalties

Rebates toPBMs Copay assistance Other price concessions

Federal Supply Schedule (FSS)Price

340BPrice

Medicaid Price

Federal CeilingPrice

Generics

FederalUpper Limit

Federal Ceiling; “Big4”Price

Supplemental rebatesand discounts negotiated (including ADAPs)

StateMaximum Allowable Cost

Supplemental discounts negotiated (VAandDoD)

Commercial PayerMAC

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340B and the Ryan White HIV/AIDS Program

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340B Background

 The 340B Drug Pricing Program was developed to allow manufacturers to continue offering discounted drugs to safety net entities, following the introduction of the Medicaid Drug Rebate Program  Medicaid required manufacturers to calculate average and best prices for the Medicaid program, and any discounts to safety net entities would reduce Medicaid reimbursement  The 340B Program was established to allow manufacturers to exclude these discounts from their Medicaid calculations

Slide18of31FromTHorn,MS atNewOrleans,LA,December4-7,2019,RyanWhiteHIV/AIDS ProgramCLINICALCONFERENCE, IAS  USA.