Type: Law Bulletins
Date: 01/25/2013

Drug Manufacturers New to Medicare Part D: Less Than One Week Left to Ensure You Can Contract for 2014

Under regulations issued by the Centers for Medicare and Medicaid Services (CMS) last spring, drug manufacturers that are new to the Medicare Part D program are required to have a Coverage Gap Discount Program agreement in place with CMS by January 30, 2013, to be eligible for inclusion on Part D formularies beginning January 1, 2014. New manufacturers with recently approved products, as well as existing manufacturers seeking to list their drug products on Part D formularies for the first time, should be keenly aware of this requirement.

What does this mean for manufacturers entering the Part D market for the first time?

If you miss the January 30, 2013, deadline to fully execute the Coverage Gap Discount Program agreement, your drug will be excluded from Part D reimbursement for 2014 and all of 2015. Depending upon the target patient market for your product, exclusion from Part D has the potential to significantly impair your go-to-market strategy and projected product revenues.

However, if you do miss the deadline, certain arrangements may be available to ensure that your product can be eligible for Part D coverage in 2014. In addition, for manufacturers seeking to enter the Part D market for 2013, other arrangements may be available to try to obtain formulary placement during the 2013 calendar year.

Information regarding CMS’ Coverage Gap Discount Program, as well as a copy of the regulations issued in April 2012, can be found here.

Please contact Mark McAndrew or other members of Taft’s Health & Life Sciences practice group for further information about contracting with CMS and Medicare Part D Plans, as well as other issues relating to managed care contracting and market access strategies.

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