Risky Business - Pharmaceutical Executive


Risky Business
Accurate and ethical price reporting is a compulsory, albeit confusing, practice for pharmaceutical manufacturers.

Pharmaceutical Executive

Establish a set of procedures through which ASP, AMP, Best Price, and non-FAMP submissions are automatically subjected to regular historical review. Significant deviations from historical norms should trigger close inspection of pricing figures before they are submitted to CMS or the VA.

Establish a data storage facility where pricing data can be kept for at least 10 years. By rule, manufacturers are required to maintain records on their participation in the Medicaid and Medicare programs for at least 10 years, and longer if the company is subject to an audit or investigation.

Government price reporting requirements can be daunting and demanding, particularly for executives, lawyers, and business managers who do not have time to master and stay abreast of the detailed legal and regulatory requirements. But companies that use such complexity as an excuse for not ensuring the accuracy and integrity of the data they report to the government are taking significant risks in today's regulatory environment. The consequences of performing the calculations improperly can be truly disastrous to a pharmaceutical manufacturer that hopes to continue selling its products in the United States. Most companies that have taken the time to review and update their pricing policies and procedures have found it to be a very worthwhile investment.

Anthony Farino (
) is a US pharmaceutical advisory services leader and Timothy Nugent (
) is a director with PricewaterhouseCoopers. John T. Bentivoglio (
), partner, and John Shakow
, counsel, are with law firm King & Spalding.


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