HRSA’s 340B Prime Vendor Program

1. HRSA’s 340B Prime Vendor Program

2. 340B Program Administration • The 340B Program Team: • HRSA’s Office of Pharmacy Affairs • Pharmacy Services Support Center (PSSC/PharmTA) • 340B PVP Prime Vendor Program (Apexus Inc.)

3. Apexus – HRSA’s 340B Prime Vendor • Unique federal purchasing program (public-private partnership) • Voluntary program for suppliers and 340b covered entities • Mission - To improve access to affordable medications for all 340B covered entities by: • Lowering participants’ supply costs by expanding the current PVP portfolio of sub-340B priced products • Providing covered entities with access to efficient drug distribution solutions to meet their patients’ needs • Providing access to other value added products and services meeting covered entities’ unique needs

4. Eligibility requirements • HRSA Grantee Hospitals • Black Lung DSH • FQHC Children’s Hospitals • FQHCLA Cancer Hospitals(selected)* • Title X Critical Access Hospitals* • Ryan White Sole Community Hospitals* • TB Rural referral Centers* • STD • Tribal 638 • Hemophilia

5. 340B Prime Vendor Program Participantsby Effective Date (cumulative, as of Mar. 1, 2010)

6. PVP Participants by Entity Type (as of Mar. 2010– 9,752 participants)

7. Current Patient Definition Requirements Three criteria to meet: • The covered entity must maintain records of health care services for the individual; • The individual must receive care from a health care professional who is employed by or under contract or other arrangements with the covered entity; and • Responsibility for the care provided must remain with the covered entity.

8. Covered drugs: Outpatient Prescription drugs Over-the-counter drugs (if accompanied by a written prescription) Clinic administered drugs within eligible facilities ER drugs Drugs in other amb care settings (e.g. day surgery) Non-covered drugs: *Vaccines Drugs given to the patient in inpatient care settings What Drugs Are Covered? *Aggressive discounts have been negotiated for vaccines and other non-covered by the Prime Vendor Program

9. 340B Service Options • In-House Pharmacy • Traditional • Tele-pharmacy • Management company operated • Contracted Pharmacy • Community retail • Mail order • Multiple contract pharmacies (effective April 5, 2010) • Prescriber Dispensing

10. Benefits of PVP to Covered Entities • No risk or cost to participate • No change of distributor required • Maximize value delivered through a single national program • Access to 340B sub-ceiling prices for drugs and discounts on other products/services • Most entities do not have the expertise, resources, or leverage to do independently • Bypass complex contracting procedures • Longer term contracts to base formulary decisions • Pricing transparency via secure website

11. Authorized Distributors • PVP participants have program access without changing their pharmacy distributor • Over 100 ordering sites covering U.S. • Seamless access to Prime Vendor pricing Regional Distributors • Burlington Drug Co. • Dakota Drug • Capital Wholesale Drug Co. • H.D. Smith Drug Co. • Kinray, Inc. • Morris & Dickson, Co., LTD • Mutual Drug Co. • Rochester Drug Cooperative • National Distributors • AmerisourceBergen Corp. • Cardinal Health • McKesson Drug • Specialty • ANDA • R&S Sales • Smith Medical Partners • GIV/Schein • Curascript (Implanon) • CVS/Caremark (Implanon)

12. Typical Apexus/PVP Contract • Sub-340B pricing • Steeper sub-ceiling discount possible via appropriate non-discriminatory performance tiers • No rebates • Two to three year agreement • Negotiable admin fee (dependent on ease of contract administration and marketing support requested) • Posting of ceiling pricing and PVP pricing on secure PVP website

13. PVP Savings by Entity Type

14. PVP – Supplier Value Proposition • An efficient and low cost method of contracting with public sector entities • Proven track record and understanding of government pricing • Price protections on branded drugs • Partner in developing a win-win strategy to improve sales and marketshare of generics or brands in the 340B market • Many manufacturers do not have a proactive strategy for the 340B market • Infrastructure to deliver accurate and transparent pricing with emphasis on improving 340B program integrity • Co-marketing of products and services

15. Ongoing Work with Authorized Distributors (AD) • Validation of quarterly PHS pricing • Receive file from AD • Normalize the data and present by NDC • Assure the PVP prices are sub-ceiling • Provide file to AD to address pricing discrepancies • Post results on the website • Monitoring “Lost” Savings • Run quarterly reports of price paid vs. PVP price • Provide a report to each AD to issue credits and rebills to correct any over charges

16. Abbott Labs Abbott Diabetes Care Allendale Pharmaceutical Alliant Pharmaceuticals AMO Astellas Pharma Astra-Zeneca Pharmaceuticals Abraxis Pharmaceutical Akorn Inc. Apothecus Barrier Therapeutics Bayer Pharma Bayer Diagnostics Bedford Labs Can-am Care LLC Caraco Pharmaceutical Labs CSL Behring Eisai Pharma G&W Laboratories Geritrex Corporation GlaxoSmithKline Hawthorne Pharmaceuticals, Inc Home Diagnostics Inc. Early Detect Eli Lilly & Company Major Pharmaceuticals Medicure Merck & Co. Morton Grove Pharm Inc. NitroMed Inc. Novartis Vaccines Okomoto USA Inc. Paddock Labs PharmaDerm RD Plastics Co Inc. Rx Elite Holdings, Inc. Sandoz Pharmaceutical Sanofi-Pasteur Schering Plough Shire Pharmaceuticals Standard Register Tercica Teva Health Systems Total Pharmacy Supply Tri State Distribution Stratus Pharmaceuticals Trinity Biotech X-Gen Pharmaceuticals Watson Pharma Inc. Wockhardt Pharma Wyeth Pharmaceuticals Supplier Agreements

17. Program Enrollment • All Entities must be registered with HRSA • Complete and submit the online Participation Agreement to Apexus • www.340bpvp.com • Apexus verifies eligibility with OPA and notifies your selected pharmacy wholesaler to load PVP pricing • Participants are activated on the 1st of each month • Apexus notifies covered entity of approval and provides instructions to access our secured website

18. Other PVP Discounted Products and Services • Vaccines – Hep A, Hep B, Flu (multiple sources) • Patient Assistance Program Software • Auditing and overcharge recovery services • Dispense ready/pre-packaged pharmaceuticals • Prescription vials/labels/printer cartridges • Diabetic Supplies – meters, strips and syringes • Pharmacy technology and automation • HIV Rapid Test Kits • Medicare Part D support • Reverse Distribution (pharmacy returns)

19. Market Segment Secure Website

20. 340B Tutorial at www.340bpvp.com

21. PVP Catalog Item Listing

22. Informational Tools & Resources • Pharmacy Flash Newsletter • Contract highlights/supplier profiles • Government & policy news • Industry news • Clinical corner – high impact drug briefs • Drug shortage/product recall • ISMP Medication Safety Alert! • Educational programs for all Stakeholders • On-demand tutorials • Monthly educational training webinars to subgroups • National presentations

23. Informational Tools & Resources • Drug price forecasts and other budgeting tools • Best Buy by Therapeutic Class Report • PHS Selling Price Comparison Reports (Quarterly) • Quarterly Price Change Report • 340B Selling Price Look-Up & Download

24. Contact Information • Office of Pharmacy Affairs • Phone: 301-594-4353 or 1-800-628-6297 • Email: opastaff@hrsa.gov • Web: www.hrsa.gov/opa • Pharmacy Services Support Center • Phone: 1-800-628-6297 • Email: pssc@aphanet.org • Web: http://pssc.aphanet.org • Prime Vendor Program • Phone: 1-888-340-2787 • Email: 340b_primevendor@340bpvp.com • Web: http://www.340bpvp.com