1. VA Drug Accountability Conference
National Acquisition Center
Steve Thomas
Director, National Contract Service
VA National Acquisition Center
P.O. Box 76, Bldg 37
Hines, IL
(708)
David Carden
Clinical Pharmacist
(708)
vaww1.va.gov/oamm/oa/nac/ncs/index.cfm

2. Presentation Outline Steve Thomas
National Contract Service Organization
Drug Purchasing Methods Used by VA
National Contracts
Pharmaceutical Prime Vendor
Pharmaceutical Repackaging Program
David Carden
Notes from the NAC
Veterans Health Care Act of 1992

3. National Contract Service Organization
Office of the Director
Steve Thomas
James Booth
Direct Delivery
Anthony Crumpton
Eric Lee
Pharmaceuticals
Maria Ramirez
Pharmaceutical Standardization
Pharmaceutical Prime Vendor
German Arcibal
Pharmaceutical Repackaging
Fran DeRosa
Willie Anthony
Tim Richards
Standardization
Medical/Surgical Prime Vendor
VACANT
Medical/Surgical
Ron Jenkins
Frank Zacchigna
CMOP

4. Drug Purchasing Methods Used by VA
National Contract
Federal Supply Schedule
Blanket Purchase Agreement
Incentive Agreement
Open Market Purchase

5. Pharmaceutical National Contracts
Standardized products
Leveraged pricing
Efficient delivery
Point of contact: Maria Ramirez
(708)

6. Pharmaceutical National Contracts – Broad Objectives
Lower Cost with Same Outcomes
or, better still…
Same Cost with Better Outcomes
or, best…
Lower Cost with Better Outcomes

7. Pharmaceutical National Contracts -Clinically Driven Contracting
Individual Evaluation Tools
Efficacy
Outcomes
Safety
Compliance
VA patient needs
Pharmacy factors
Clinical evaluation + Price = Best Value

8. Pharmaceutical National Contracts – Contracting Process
Step 1 – Pre-Procurement Request PBM works up clinical review, meeting announcements, representative discussions with PBM Step 2 – Procurement Request from PBM to NAC Step 3 – FedBizOpps Notice Advertises Procurement for at least 15 days Step 4 – Issue Solicitation Step 5 – Solicitation Closes Step 6 – Award

9. Buy American Act
FAR 25.1
Restricts the purchase of supplies that are not domestic end products
Applies to order values less than $194,000
If domestic offer is not the low offer, apply:
An additional 6% to the low offeror’s price if the domestic offeror is a large business concern
An additional 12% to the low offeror’s price if the domestic offeror is a small business concern

10. Trade Agreements Act FAR 25.4
Waives the Buy American Act and other discriminatory provisions for eligible products from countries that have signed an international trade agreement with the United States, or that meet certain other criteria.
Offers of eligible products receive equal consideration with domestic offers.
Applies to order values over $194,000 (when not set-aside for small business)

11. Purchasing Open Market
If item(s) are on contract, order from the contracted source.
If item(s) are not on contract, seek out the advice of an acquisition professional. Why?
If order value is $0 to $3,000:
Follow Micropurchase Procedures in FAR
Distribute orders equitably among qualified suppliers
May be awarded without soliciting competitive quotations
Use of purchase card is the preferred method
Do not split orders to keep them under $3,000

12. Purchasing Open Market (continued)
If order value is $3,001 to $25,000
Set-aside for small business
Non-manufacturer rule does not apply (FAR (c)
Buy American Act applies
If order value is $25,001 to $100,000
Set-aside for small business with exception in FAR
Non-manufacturer rule does apply

13. Purchasing Open Market (continued)
If order value is $100,001 to $194,000
Set-aside for small business if there is reasonable expectation that 2 or more small businesses will offer products of a small business concern.
Buy American Act applies
NOTE: For orders between $50,000 and $194,000, the Israeli Trade Act Applies (FAR )
If order value is over $194,000
Trade Agreements Act applies

14. Pharmaceutical National Contracts – Products
Pharmaceuticals
Medical gases
Dietary supplements
IV solutions
Influenza vaccine

15. Prime Vendor Wide variety of product coverage One stop shopping
Flexible delivery to multiple sites
Electronic ordering and price look-up
Inventory and space reduction
Fill rates greater than 97%

16. Pharmaceutical Prime Vendor Program
Awarded to McKesson Corporation on December 31, 2003
Potential 8 Year Contract (2 year contract with three, 2 year options)
Negative distribution fees
Point of contact: German Arcibal
(708)

17. Pharmaceutical Repackaging Initiative
NAC coordinates bulk order shipments to PrePak
PrePak repackages product in government labeled bottles
Facilities order from PrePak
7 Drugs Currently Covered by the Program – Alprazolam, Furosemide, Ibuprofen, Isosorbide Dinitrate, Omeprazole, Spironolactone & Temazepam
Point of Contact: Fran DeRosa (708)

18. Notes from the NAC
Notes From The NAC  March 26, 2010 Attached are this week's Top 10+ Report, an Open Market Report, a Prepak Fax in order form, a Wyeth Product Status Report a Merck Vaccine Status Report and a copy of the FDA Unapproved Drug Initiative Link I forgot last week.   FSS QUESTIONS…The Federal Supply Schedule management now has a “Help Desk” for any questions you may have about products that may have dropped off contract or need to be on contract. or Please copy me on s so I can follow up and maybe suggest alternatives and let other centers with the same problem know.   Many Big Shortages Continue…Since the end of last year there has continued to be ongoing shortages of many drug products. Ciprofloxin regular release tablets is one drug that is experiencing shortages due to the Apotex and Ranbaxy problems with the FDA; the other generics and the brand have been either unavailable or on very low allocation. Only in the past few weeks have products from Teva,Watson and a few smaller companies been available open market along with the contract brand but all of these are still subject to allocation. Doxazosin and Prazosin generics are still not available in most cases and the brands are allocated. The newer problem is Flunisolide Nasal where the brand was discontinued and the generic used most by the VA had raw material shortages. The other generic has not been able to keep up and conversion of patients to Fluticasone has created a shortage and allocation of that product. This little review does not even cover half the drugs that have been in short supply. The only good news is that where many of the products since January have had no expected return date, many are now listed as “April”. Some say “early April” and some say “late April” but we now have some hope. Let’s just hope that in April the expected return date does not change to June or July, that would make a painful summer.

19. Notes from the NAC The Attachments Top 10+ Report Open Market Report
Prepak Fax in Order Form
Wyeth Product Status Report
Merck Vaccine Status Report
Others as needed

20. Notes from the NAC Top 10 + Report Econo # Description Generic Name
NDC
Vendor Name
Comments
FLUNISOL N/SOL 0.025%
FLUNISOLIDE
APOTEX CORPORATION @
This company is reporting production delays with NO return date. There is a shortage of raw material. The brand to this product has been discontinued so little is available as an alternative.
FLUNISOL N/SPR 0.025%
BAUSCH & LOMB PHARM @
Due to the shortage of the product above the demand for this product has it in production delays with allocation. B&L is ramping up to produce more but it is not available yet.
IPRATRO INH SOL .02% NEPH 30
IPRATROPIUM BROMIDE
NEPHRON PHARMACEUTICALS
This is listed with production delays with return in Mid March. The 25s are available in most areas. There are also some other FSS products, check McKesson Connect.
SIMVASTAT TAB 80MG BLU
SIMVASTATIN
BLU PHARMACEUTICALS LLC
These are samples of some out products others may be allocated.
SIMVASTAT TAB 80MG BLU
BLU cannot keep up with the current demand so some sizes have
SIMVASTAT TAB 80MG BLU
been on and off. A number of sizes shipped the middle of last week.
SIMVASTAT TAB 10MG BLU
They have told McKesson they will continue to be on and off and have not given a back to normal date.

21. Top 10+ Report Stock Status
Notes from the NAC
Top 10+ Report Stock Status
8144
8148
8149
8165
CMOP
HINES
CHARLESTON
MURFREESBORO
DALLAS
Econo
Sell Description
On Hand
On Order
On Hand
ACCU-CHEK COMF CV GLU T/STR 50
19663
289
10559
1152
1604
ACETAM TAB 325MG MARL 100
3502
12912
277
4128 27
4080
ACETAM TAB 500MG MARL 100
1208
11267
7400
142
6000
ALBUTEROL INH 0.083% UDNEPH 25
7588
5016
1448
478
360
717
ALBUTEROL INH SGL 0.083%NEPH30
1076
972
2237
787
720
791
ALENDRONAT TAB 70MG UU COB
164
1274
448
941
AMLODIPINE TAB 10MG COB 87
8032
568
2103
AMLODIPINE TB 5MG COB
N/C
547

22. Notes from the NAC Open Market Report Econo NDC Num Vendor Name
Sell Description
Open Market $
Notes
TEVA PHARMACEUTICALS
GEMFIBR TAB 600MG TEV
$83,530.62
There continues to be a shortage of the
CAMBER PHARMACEUTICALS
GEMFIBR TAB 600MG CAMB
$48,438.85
contract Gemfibrizol and these two items are all that is available. Major just added it to FSS 4/1/2010 so ask McKesson to stock the Major items on contract.
WEST WARD PHARMACEUTICALS
COLCHICIN TAB 0.6MG WEST 1000
$40,326.34
This is one of those generics that is being reviewed by the FDA. There is a brand available that is FDA approved and on FSS.
SANDOZ @
BUPROPIO TAB 75MG SAN
$29,576.16
I am not sure why anybody bought this. There seems to be plenty of the National Contract item available everywhere I look. Please do not reorder…ask McKesson to stock the Golden State contract item.
GE HEALTHCARE
VISIPAQUE 320MG POLYB 100ML 10
$28,133.00
GE Healthcare products that are not on FSS
VISIPAQUE 320MG POLYB 500ML 10
$17,584.64
are made in China. McKesson should have a corresponding product available on FSS. If they do not stock it ask them to.

23. Notes from the NAC Other Attachments Prepak Fax in Order Form
Wyeth Product Status Report
Merck Vaccine Status Report
Others… Notices from companies, Holiday hours for ordering and pages that may help clarify one of the “Notes”.

24. Veterans Health Care Act of 1992 Public Law 102-585 Section 603
Only covers brand name (NDA) prescription products and biological products.
For these “covered” drugs, companies must follow the rules under the Public Law and their product is given a Federal Ceiling Price (FCP).
Generic products (ANDA), OTC (non-prescription) and certain brands that were grandfathered out of the law in 1992 are not subject to the law.

25. Veterans Health Care Act of 1992 Public Law 102-585 Section 603
Companies are required to submit their NFAMP
(Non Federal Average Manufacturer’s Price) for each new drug (NDC).
The companies are given temporary FCPs during the first 90 days of sales but basically once the NFAMP is determined they have a permanent FCP.
FCP = 76% of the NFAMP
(The VA gets about a 24% discount)

26. Veterans Health Care Act of 1992 Public Law 102-585 Section 603
“Covered” drugs must be on FSS.
The Big4 price must be equal to or lower than the FCP.
Some companies have “dual” pricing. That means their product has a Big 4 FCP price but can have a FSS negotiated price for all “OGAs” other government agencies.
Companies can have National Contracts, BPAs (Blanket Purchase Agreements) or TPRs (Temporary Price reductions) but the price must be lower than the FCP for Big 4 customers.

27. Veterans Health Care Act of 1992 Public Law 102-585 Section 603
Each year in November companies must supply their current NFAMP.
The previous calculation is done and compared to the current FSS price plus the increase in the CPI-U as of October.
The lower of the two is the new FCP.
Every 5th year, the FCP goes back to the original calculation, not lower of the two. (2009)
In some cases, where a company raises prices too fast, they can cause an additional discount which causes a negative FCP. The company then gets a penny price for a year.

28. THANK YOU