Premier Suggests Refinements to Senate Finance Committee Drug Shortage Discussion Draft

Premier submitted comments to the Senate Finance Committee, applauding the lawmakers’ bipartisan work to seek a path forward on addressing the issue of drug shortages in the Medicare program and for recognizing the vital role that group purchasing organizations (GPOs) play in vetting quality manufacturers and combatting shortages. Premier’s response to the draft legislation focuses on opportunities to further refine the proposal to best serve the needs of patients. Specifically, Premier urges the Senate Finance Committee to consider amendments to the draft legislation that:

• Aligns all timelines for Program Participants, Payment-Eligible Providers, and Applicable Generic Manufacturers to a three-year timeline;
• Clarifies that minimum commitment volumes should be done at the National Drug Code (NDC) level;
• Ensures there are a minimum of three Program Participants across various business sectors to ensure viable competition in the marketplace;
• Creates a payment methodology for Program Participants that is a scalable flat fee based on the services provided;
• Requires Program Participants to maintain an advisory committee comprised of individuals with clinical and/or supply chain expertise from Payment-Eligible Providers to help ensure that contracting decisions are being made in the best interest of patient care and supply chain resiliency;
• Clarifies that a secondary manufacturer is not required to be added to contract if more than one manufacturer is unable to meet the stringent vetting requirements of the program;
• Studies the downstream impact of removing 340B discount eligibility on the ability of a covered entity to provide care to underserved populations;
• Prohibits Payment-Eligible Providers from seeking or accepting additional rebates, discounts, or other price concessions from Program Participants;
• Refines the buffer inventory requirements to be more cohesive;
• Permits Program Participants to centralize and collate reporting on behalf of Payment-Eligible Providers;
• Considers outcomes measures that tie back to patient outcomes; and
• Requires Applicable Generic Manufacturers to submit transparent quality and manufacturing data to Program Participants to facilitate product review and selection.