Prescription Drug Purchasers
Qualified Purchasers
Health and Safety Code § 127675 defines purchasers in California who are qualified to receive the 60-day advance notices of specified whole acquisition cost (WAC) increases as:
“(1) A state purchaser in California, including, but not limited to, the Public Employees’ Retirement System, the State Department of Health Care Services, the Department of General Services, and the Department of Corrections and Rehabilitation, or an entity acting on behalf of a state purchaser.
(2) A licensed health care service plan.
(3) A health insurer holding a valid outstanding certificate of authority from the Insurance Commissioner.
(4) A pharmacy benefit manager as defined in subdivision (j) of Section 4430 of the Business and Professions Code.”
Qualified purchasers must register to receive the 60-day advance notices. Registration is online and includes required contact information of the purchaser. HCAI provides online the Registered Purchasers List that manufacturers can download and use to send the 60-day advance notices.
FAQs
What is wholesale acquisition cost (WAC)?
Wholesale Acquisition Cost (WAC) is defined in the U.S. Code as “…the manufacturer’s list price for [a] drug or biological to wholesalers or direct purchasers in the United States, not including prompt pay or other discounts, rebates or reductions in price…”
Can any purchaser of prescription drugs receive the 60-day advance notices of specified WAC increases?
No, only California state government purchasers, licensed health care service plans, health insurers holding a valid outstanding certificate of authority from the Insurance Commissioner, and pharmacy benefit managers as defined in subdivision (j) of Section 4430 of the Business and Professions Code that purchase or reimburse for prescription drugs are eligible to register for advance notice from manufacturers.
Are prescription drug purchasers required to register with HCAI?
No. Registration is voluntary. However, manufacturers are required to send 60-day advance notices of specified WAC increases to only registered purchasers. Only specified purchasers are eligible to register to receive the advance notices.
California state government purchasers, licensed health care service plans, health insurers holding a valid outstanding certificate of authority from the Insurance Commissioner, and pharmacy benefit managers as defined in subdivision (j) of Section 4430 of the Business and Professions Code that purchase or reimburse for prescription drugs are eligible to register for advance notice from manufacturers.
I reimburse prescription drug manufacturers, but I am not a direct purchaser. Am I eligible to receive the 60-day advance notices?
Yes. California state government purchasers, licensed health care service plans, health insurers holding a valid outstanding certificate of authority from the Insurance Commissioner, and pharmacy benefit managers as defined in subdivision (j) of Section 4430 of the Business and Professions Code that purchase or reimburse for prescription drugs are eligible to register for advance notice from manufacturers.
Are all prescription drugs subject to required reporting and advance notice?
No. The law only pertains to human prescription drugs that are marketed and sold in California, regardless of a drug’s location of manufacture, packaging, or wholesale distribution. Radiologicals, active pharmaceutical ingredients (API’s), and compounded prescriptions drugs are excluded.
Prescription drugs sold in medical delivery devices (e.g., syringes, injection pens, and transdermal patches) are subject to reporting and noitice. Medical delivery devices sold without a prescription drug included are not.