Latest Articles

Late yesterday, the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) released a proposed rule to amend the anti-kickback safe harbors[1] in response to perceived risks that rebates paid by pharmaceutical manufacturers to payors and pharmacy benefit managers (PBMs) may contribute to pharmaceutical list price inflation and not benefit patients and payors.  The proposed rule would (i) remove safe harbor protection for drug manufacturer rebates to Part D…
Last week, California Governor Gavin Newsom signed an Executive Order creating a program to lower prescription drug costs throughout the state. This initiative could significantly impact pharmaceutical manufacturers, managed care companies, pharmacies and other industry participants, as well as prescription drug consumers. Reed Smith’s health care and antitrust teams summarize Newsom’s Executive Order and address consequent legal and policy issues in this client alert.…
The Office of Inspector General (OIG) of the Department of Health Human Services (HHS) is seeking input on Medicare and State Health Care Programs: Fraud and Abuse; Request for Information Regarding the Anti-Kickback Statute and Beneficiary Inducements CMP. The OIG describes this request for information (RFI) as part of HHS’s endeavor “to transform the health care system into one that better pays for value.” The RFI looks to identify ways to amend or add…
The newly-enacted Bipartisan Budget Act of 2018 includes numerous Medicare, Medicaid, and other policy and payment provisions impacting health providers and manufacturers. Of particular note, the new law:  increases Medicaid rebate obligations with respect to line extension drugs; changes manufacturer discount obligations in the Medicare Part D “donut hole”; repeals the Independent Payment Advisory Board (IPAB); makes Stark Act revisions; and significantly increases penalties for violations of various anti-fraud statutes.  A Reed Smith Client Alert…
As noted in our recent Health Industry Washington Watch blog post, outgoing House Speaker John Boehner and the Obama Administration have reached agreement on a two-year, $80 billion budget/debt-ceiling deal that includes Medicare and Medicaid “offsets” to finance other spending.  For manufacturers of generic pharmaceuticals marketed under abbreviated new drug applications, Section 602 of the proposed Bipartisan Budget Act of 2015 (BBA) includes an important proposed change to the Medicaid rebate program with implications for…
This post was also written by Elizabeth Doyle O’Brien. Referencing what it deems a “proliferation” of physician-owned distributors (PODs), on March 26, 2013, the Department of Health and Human Services (HHS) Office of Inspector General (OIG) released a Special Fraud Alert identifying significant concerns with such entities under federal anti-kickback principles.1 For purposes of the Alert, the OIG defines a POD as “any physician-owned entity that derives revenue from selling, or arranging for the…
This post was also written by Vicky G. Gormanly. On Friday, January 27, 2012, the Centers for Medicare & Medicaid Services (“CMS”) released its long-awaited proposed rule to implement the provisions of the Affordable Care Act (“ACA”) relating to pharmaceutical manufacturer payment of Medicaid rebates and limits on Medicaid reimbursement to pharmacies. The proposed rule addresses a number of important policy issues relevant to pharmaceutical manufacturers, pharmacies, and other providers, and also would pose significant…
This post was also written by Ruth Holzman. The IRS has issued updated guidance to drug manufacturers on the Affordable Care Act’s annual fee imposed on covered entities engaged in the business of manufacturing or importing branded prescription drugs. The guidance addresses submission of required information, IRS notification of covered entities of their preliminary fee calculation; submission of error reports for the dispute resolution process, and notification of final fee calculations. Among other things,…
This post was also written by Vicky G. Gormanly. On August 4, 2011, CMS held an “External Stakeholders Meeting” at its Baltimore headquarters to discuss the development of a survey for what it is now calling “National Average Drug Acquisition Cost” or “NADAC”. Earlier this year, CMS announced that it would publish a pricing benchmark based upon pharmacies’ acquisition costs for both brand and generic drugs, which State Medicaid programs could use instead of Average…
This post was also written by Jouya Rastegar. On June 9, 2011, Senator Orrin Hatch released a report by the Senate Finance Committee Minority Staff that outlines key concerns about Physician-Owned Distributors (“PODs”), specifically regarding the lack of regulatory oversight and clear guidance from the Department of Health and Human Services Office of Inspector General (“OIG”). The Committee Minority’s report, Physician Owned Distributors (PODs): An Overview of Key Issues and Potential Areas for Congressional Oversight