Advanced Contracting Course

Transcription

1 Advanced Contracting Course Stephanie Levin, AD, Commercial Data Acquisition & Scouting Bayer Healthcare Leslie Yendro, VP Business Development Avella Specialty Pharmacy

2 Agenda Introduction Common Types of Contracts between SP s and Manufacturers Core vs Enhanced Services Fair Market Value Contracting for Enhanced Services Key considerations when contracting for data Timeline for contracting and key considerations We encourage audience interactions so we can all learn from each other!

3 Most Common Types of Contracts DISCOUNT Typically discount off WAC price Loaded at Wholesaler or via direct purchase from manufacturer Discounts are never free! Imply a service is taking place Intended to move market share SERVICE Fees paid for specific services provided Fair Market Value Core vs Enhanced Service RISK SHARE More prevalent in Managed Care Agreements Discounts or Rebates based on enhanced performance

4 Core vs Enhanced Services Core: services provided in the normal course of business Prescription intake Benefits investigation Initial patient onboarding Disease and Drug education Refill reminders Shipping to patient or provider Does not imply overnight *** THESE VARY BY COMPANY AND TYPE OR ORGANIZATION Enhanced: services requested of SP that are not core Data Shipments of collateral materials to patients Touch points outside the dispense Mid Therapy calls Rescue calls Advanced Titration HUB enrollments Dedicated Account Management Adverse Event Reporting Anything that is customized

5 Contracting for Enhanced Services Ensure the ability to PERFORM and TRACK the service Payment follows documentation If it isn t documented, it wasn t done What are your Strategic Objectives? What tactics will achieve those objectives? How will you measure that your objectives are met? What is the impact on your overall budget?

6 Enhanced Services Vary Across Entities Utilization of Manufacturer Co-Pay cards Live vs robo calls Level of expertise performing the services Adverse Event Reporting Data capabilities

7 Data Requirements and Process Flow

8 What Does Good Look Like? Data Fields Do the data elements support the measurement of key business questions Can the SPP/HUB reliably provide the data elements. (e.g. are they a required part of operations) Are the data fields clearly defined Number of Files Is the data consolidated as much as possible Is data duplicative across deliverables File Delivery Is the data being sent to the right place (e.g. data aggregator, direct to manufacturer) Compliance Scoring / Fee Structure Does the contract specify exactly how compliance is measured Does the fee appropriately incentivize the SPP/HUB to provide the required data

9 High-level Process Flow SPP/HUB Data to Manufacturer Data Supporting Internal Requirements Internal Requirements SPP/HUB to Data Aggregator* Based On Stakeholder Needs Sales Force Sales Leadership Marketing Managed Markets Human Resources Reporting & Analytics Data Warehouse to Downstream Systems Data Aggregator to Data Warehouse (Manufacturer) * Data aggregator optional; SPP may provide data directly to manufacturer

10 Internal Requirements Detail Requirements Gathering to Contract Generation Internal Requirements Business Need Assessment Sales & Marketing Managed Markets Reporting & Analytics Human Resources Data Requirement Development Draft core requirements Stakeholder review Contract Generation Provide core requirements, fee structure, compliance scoring Review of Contract Draft

11 Solicit SPP Feedback on Data Bayer hosted a Data Summit in 2014 to open a dialogue with our SPP partners. Key questions and facts about SPP operations led to significant improvement in our understanding of current pain points & challenges. Why do manufacturers ask for all of this data? We are in the business of helping patients not collecting data Our systems don t capture that data We don t need all of that information to fill an Rx That data is captured in different systems and they aren t connected

12 Proactively Engage Stakeholders Data & Implementation Capabilities Analytics & Reporting Future data needs & data required to perform analyses Knowledge of product & overall strategy SPP/HUB In-depth knowledge of data & data flow to downstream systems Sales & Marketing Data Mgmt.

13 Develop Core Data Set File layouts Industry standard when possible (e.g. 867) Ability to answer key business questions across brands Core data elements Additional data sets may be required to track enhanced services Compliance Scoring Sliding scale per report with clearly defined measures

14 Why do I care about Fair Market Value? AntiKickback Statute (AKS) Avoiding violations is best accomplished by meeting a safe harbor. Most AKS safe harbors include the requirement that payments are fair market value. Stark Law Avoiding violations usually requires meeting an exception. Most Stark Law exceptions include the requirement that payments are fair market value. The False Claims Act Violations of Stark and Antikickback may give rise to actions under the false claims act. IRS Code for 501(c)(3) entities Payments in excess of fair market value may violate prohibition on private inurement/excess benefit and result in intermediate sanctions and/or jeopardize tax exemption.

15 42 CFR Bona-fide service fees are fees paid by a manufacturer to an entity that represent fair market value for a bona fide itemized service actually performed on behalf of the manufacturer that the manufacturer would otherwise perform or contract for in the absence of the service arrangement and are not passed on in whole or in part to a client or customer of an entity whether or not the entity takes title to the drug.

16 FMV Considerations Payment must be for bona-fide services for which there is commercially reasonable need. Fees cannot be for referrals or marketing / promotion of the product Independent input to the valuation of services is recommended Fees should be established prior to commencing services, and not based on volume or value of the business The government provides guidance and opinions in this area, but is very clear when assessing penalties.

17 Entities Subject to FMV Manufacturers PBMS Payers HUBS Retail Pharmacies Wholesalers OIG Specialty Pharmacies and Specialty Distributors Hospitals Clinics Physicians Infusion Pharmacies

18 Contract Considerations Business What services are needed? Who can provide those services? RFP? What is the FMV cost of the services? Budget? How will we track the performance of the services? Legal IT build and testing Contract Onboarding with partners

19 A note about Penalties vs Incentives What outcomes are you looking to achieve? Which are critical to your business on a daily basis? What level of effort will you get from your partners under each scenario? Budget considerations

20 Summary Establish a solid process for your contracting strategy Benchmark and create grids of your services and costs Audit your contracts routinely Reassess FMV at contract renewal Select partners with best-in-class processes with an understanding of FMV methodology to reduce risk DOCUMENT EVERYTHING!!!