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July 2009 |
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AWP Litigation Update The court overseeing the First DataBank (FDB) and Medi-Span average wholesale price (AWP) lawsuits entered a Final Order and Judgment approving the settlements on March 30. Any future changes based on these settlements will be made with the goal to preserve plan sponsor and Innoviant relative economics. No plan sponsor action is needed at this time. A full update on the current status of these class action lawsuits follows. The AWP rollback resulting from the settlements is set to become effective on September 26, and Innoviant is operating under the assumption that the rollback will take place on this date. However, several pharmacy associations are seeking to stop the September AWP rollback. On April 29, the National Association of Chain Drug Stores (NACDS) and the Food Marketing Institute (FMI) notified the U.S. First Circuit Court of Appeals that they are appealing the settlements. The National Community Pharmacists Association (NCPA), Pharmaceutical Care Management Association (PCMA), Long Term Care Pharmacy Alliance (LTCPA) and American Society of Consultant Pharmacists (ASCP) also filed notices of appeal. Class action lawsuits related to AWP calculation began when a group of private third-party payers sued FDB, alleging that in late 2001, FDB and pharmaceutical wholesaler McKesson wrongfully inflated the markup factor used to determine AWP for a number of prescription products. Another pricing service, Medi-Span, was subject to a similar lawsuit and reached a similar settlement. Under these settlements, FDB and Medi-Span will not make any cash payments to the third-party payers. Instead, the companies agreed to change the way they calculate AWP. Currently, and since at least March 2005, both companies calculate AWP for nearly all branded products by marking up the wholesale acquisition cost (WAC) by 25 percent, or a factor of 1.25. As a result of the settlements, FDB and Medi-Span will reduce the markup factor to 1.2 on more than 1,400 products, which effectively reduces AWP by 4 percent on those products. FDB and Medi-Span also announced that if and when settlements are implemented, they will take the same action on approximately another 7,000 products. Again, no plan sponsor action is required at this time. Innoviant will continue to monitor developments in this class action lawsuit. Look for further information in future communications. Please contact your Innoviant Account Manager at 1.866.800.4321 with additional questions.
Four Part Series on Generic Medications Starting with this issue of Client Connection, Innoviant is launching a four part series on generic medications. The series will include information about generics and generic program options you can use to ensure your plan is designed to meet its goals and to promote understanding about using generics among your membership.
Although generics are a logical way to decrease costs without decreasing therapeutic benefits, a new survey by Prescription Solutions* shows that Among survey respondents, specific findings include:
Taking medications as prescribed is an important part of every therapy program. In addition to the health benefits members experience, this can also impact the bottom line for your overall benefit program, especially in relation to preventative therapies for conditions like diabetes, high blood pressure and high cholesterol. When patients take medications as prescribed, they are less likely to require acute medical interventions that usually cost far more under a medical benefit than the preventative medications cost under a pharmacy benefit. In Generic Utilization Part 2, we’ll review the relationship between brands, generic equivalents and generic alternatives. * The national telephone poll was conducted by Opinion Research Corporation on |
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LOOKING AHEAD |
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August Health Observances Health observances are days, weeks or months devoted to promoting particular health concerns. You may choose to use these special times The following observances are recognized by the U.S. Department of Health and Human Services for the month of August. For more information about the observance or to obtain support materials, please contact the sponsoring organization directly via the websites provided.
Source: 2009 National Health Observances, National Health Information Center, Office of Disease Prevention and Health Promotion, U.S. Department of Health and Human Services, Washington, DC. |
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A Customer-Directed Monthly |
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MEMBER EDUCATION |
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Through Client Connection and Innoviant.com, you have access to educational content specifically written for member audiences that you can adapt to meet your unique member communication needs. The July member education spotlight is on allergies — when your benefit plan members appropriately manage their allergy triggers and symptoms, they live healthier lives and can even help manage your plan’s overall benefit costs. All of the following links open documents posted on the Innoviant Member Publications page of our website. Allergy If you think you may have allergies, talk to your doctor about how to identify your specific allergy triggers. Allergies can begin at any age, but how do you explain allergies to kids suffering from symptoms? With 40 to 50 million people in the U.S. having some kind of allergy, a lot of information about allergies is available. |
