1. health and fitness
2. drugs

To:
From:
Date:
Re:
All Medicaid Directors
NAMD staff
May 18, 2015
Update on “21st Century Cures” legislation
On April 29th, the House Energy and Commerce Committee (E&C) released a second discussion
draft of its 21st Century Cures legislation. 1 A third draft with a summary was released on May
13, and was marked up by the E&C Subcommittee on Health on May 14. The subcommittee
unanimously voted to move the legislation to the full committee, which will conduct its mark
up on May 19. This memo provides an overview of the changes to these drafts that may be of
most interest to states. NAMD staff will continue to update Directors as developments warrant.
Background
The 21st Century Cures Initiative represents over a year of bipartisan work by E&C Chairman
Fred Upton (R-MI) and Representative Diana DeGette (D-CO). However, the first legislative
draft to emerge from this process included several provisions of concern to Directors. NAMD
called attention to these issues in our letter to Congress in April.
The April 29th discussion draft includes substantial revisions and was released on a bipartisan
basis. Many of the earlier provisions of concern to NAMD are not included in the second draft,
while other provisions primarily related to enhanced funding and easing administrative
burdens on the National Institutes of Health (NIH) have been added. The new draft is overall
narrower in scope than its previous version, though the presence of several placeholder sections
preserves the opportunity for significant modifications as negotiations continue.
The Senate is also pursuing legislation aimed at speeding the biomedical innovation process,
though its work is narrower in scope than the House’s efforts. Senator Lamar Alexander (RTN), Chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee
Subcommittee on Health, worked with Senator Richard Burr (R-NC) to release a report
identifying opportunities to speed the FDA’s drug review processes in January. Senator
1
The full text of the second draft is available on E&C’s website here and a section-by-section summary is available here.
444 North Capitol Street, Suite 524 ▪
Washington, DC 20001 ▪
Phone: 202.403.8620 ▪
www.medicaiddirectors.org
Alexander is also working on a bipartisan basis with Senator Patty Murray (D-WA) to convene
a workgroup and hold hearings on biomedical innovation throughout the year.
Offsets
In order to offset the costs associated with this legislation, E&C has looked to various
prescription drug policies to find savings. The committee has displayed particular interest in
certain Medicaid drug rebate program proposals offered in the President’s FY 2016 budget.
NAMD has developed a separate memo for congressional staff to provide feedback on these
proposals, which is available upon request by states.
Timeline
The House E&C Subcommittee on Health is scheduled to hold a mark-up of the third draft May
14th, with a goal of bringing the legislation to the House floor in June. The Senate HELP
Committee is on a more deliberate path, having just launched its workgroup this year. Both
chambers will continue to work on these issues, but it is unlikely they will reach agreement on a
bicameral basis this year.
Detailed Changes in the Second and Third Drafts
The enclosed chart details changes made from the first to the second draft for those provisions
of interest among Directors. Overarching changes of note are as follows:

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Many provisions regarding accelerated drug approval pathways with lower evidentiary
standards, as well as new or extended drug exclusivity categories, were removed.
o However, the dormant therapy exclusivity provisions may reemerge in a current
placeholder section as Congressional negotiations continue.
Priority review of new medical devices remains, but accelerated approval with lower
evidentiary standards was removed.
A new provision, Section 2101, will make certain health care economic information collected
by the FDA available to “a payor, formulary committee, or other similar entity in the course
of…carrying out its responsibilities for the selection of drugs for managed care or other
similar organizations.”
A new provision, Section 2102, requires the FDA to issue guidance on proper
communication of scientifically and medically sound off-label uses of drugs.
A new provision, Section 3101, creates a Medicare Pharmaceutical and Technology
Ombudsman to review that program’s coverage decisions, which may impact state
spending on the dually eligible.
Page 2 of 16

A pharmacy lock-in program for controlled substances in Medicare Part D remains in the
draft.
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
Changes in Discussion
Drafts, April 29 and May 13,
2015
NEW PROVISION: Sec. 2101,
“Facilitating Dissemination
of Health Care Economic
Information.”
 Adds “payors, formulary
committees, or their
similar entities” to the list
of organizations with
which the FDA must
share certain healthcare
economic information in
the course of its drug
approval process.
 The provision is intended
to assist in drug coverage
policy development.
NEW PROVISION: Sec. 2102,
“Facilitating Responsible
Communication of Scientific
and Medical
Developments.”
 Requires the FDA to,
within 18 months of the
legislation’s passage,
issue guidance on
facilitating the
dissemination of
“responsible, truthful,
and non-misleading
scientific and medical
information not included
on the label of drugs.”
NEW PROVISION: Sec. 2152,
“Reauthorization of Rare
Pediatric Disease Priority
Review Voucher Incentive
Program.”
Page 3 of 16
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
Changes in Discussion
Drafts, April 29 and May 13,
2015
 Reauthorizes a program
which rewards a
manufacturer of an
orphan drug for pediatric
populations with a
voucher granting priority
FDA review of another
product of the
manufacturer’s choice.
 These vouchers may be
sold to another
manufacturer.
NEW PROVISION: Sec. 3101,
“Medicare Pharmaceutical
and Technology
Ombudsman.”
 Creates an ombudsman
for Medicare pharmacy
and technology coverage
policies.
 Responsible for receiving
complaints and
grievances from
manufacturers regarding
Medicare coverage and
payment decisions.
Sec. 1041 – Approval of
Breakthrough Therapies
 Allows the FDA to
approve a drug, for a
disease/condition with
unmet medical need,
that has received
“breakthrough therapy”
designation based on
early stage clinical
safety/effectiveness
data that provides
sufficient evidence under


In effect, this provision lowers the
evidentiary standards for this drug
class.
Shorter FDA review times combined
with increased FDA authority to
require further studies after
approval, rather than settling safety
issues before approval, may
contribute to increased rates of
patient safety risks, drug
withdrawals, and black box
warnings.
Page 4 of 16
 This new approval
pathway is removed
entirely. In its place is
Subtitle E, “Expediting
Patient Access.”
 Sec. 2081 – Sense of
Congress indicates
Congress would like the
FDA to continue
approving breakthrough
drugs under the existing
breakthrough pathway as
quickly as possible.
January 2015 Discussion
Draft Provisions

current safety and
efficacy standards
Allows HHS to require
post-market assessment
of the drug, with ability
to withdraw approval if
assessment is not
conducted, drug is found
unsafe and/or
ineffective, or
manufacturer uses false
or misleading marketing
NAMD Staff Comments on Discussion
Draft

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


Sec. 1063 – Election to
Convey a Portion of
Extended Exclusivity Period
Applicable to Qualified
Infectious Disease Products
 Extends exclusivity
periods for “qualified


Patients must be educated about
this new approval pathway and the
potential risks of these fast-tracked
therapies.
The Medicaid population is
significantly different from the
privately insured population. There
are potential concerns about the
quality of evidence for drug
approval as it pertains to the drug’s
effects on Medicaid’s generally
frailer, sicker population.
Medicaid is statutorily required to
cover any FDA-approved drug in
return for mandatory rebates. No
other payer is under this same
obligation. In effect, the lowered
evidentiary standards of this
provision makes the vulnerable
Medicaid population a captive
market for any potential adverse
effects not discovered in the
accelerated approval pathway.
If this provision is enacted, periodic
surveillance reports on adverse
events, outcomes, etc. for Medicaid
and other vulnerable populations
should be required.
Medicaid should be allowed the
flexibility to not cover drugs
approved under this provision until
sufficient post-approval studies have
been conducted.
This provision could both delay the
introduction of new generic
antibiotics into the market and delay
generics for entirely separate drug
categories.
Manufacturers could extend
exclusivity for particularly high-cost
drugs longer than they otherwise
Page 5 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
 Congressional leaders
indicated they are still
negotiating this issue, as
evidenced by inclusion of
a placeholder section
(Subsection I,
“Repurposing Drugs for
Serious and Lifethreatening Diseases and
Conditions”).
 Removed.
 As above, congressional
leaders added a
placeholder section
(Subsection I,
“Repurposing Drugs for
Serious and Lifethreatening Diseases and
January 2015 Discussion
Draft Provisions
infectious disease
products” by 5 years
 Allows manufacturers to
apply up to one year of
this extended exclusivity
to one or more drugs, in
exchange for a
commensurate reduction
in exclusivity for the
designated infectious
disease product
 Manufacturers are
required to make an as
yet unspecified donation
of profits to the NIH and
a patient assistance
program from sales of
the non-qualified
infectious disease
product receiving
enhanced exclusivity
Sec. 1064 – Encouraging the
Development and Use of
New Antimicrobial Drugs
 Adds supplemental
Medicare payment to
hospital discharges
which use new
antimicrobial drugs.
NAMD Staff Comments on Discussion
Draft
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

could. The free-floating nature of
this variable exclusivity arrangement
also removes an element of
predictability for state planning
purposes.
Enhanced Medicaid rebates for
extended exclusivity periods should
be considered to mitigate these
concerns.
This provision creates an incentive
for overutilization of new
antimicrobial drugs, potentially
building up new drug-resistant
bacteria.
To the extent that such new drugs
are utilized, Medicaid cost-sharing
for dually eligible beneficiaries will
increase.
Page 6 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
Conditions”) to indicate
that negotiations are
ongoing in this area.
 Medicare payment
incentives remain in Sec.
2123 – Encouraging the
Development and
Responsible Use of New
Antimicrobial Drugs.
Does not address
Medicaid interaction with
Medicare.
 Modified in Sec. 2121 –
Approval of Certain Drugs
for Use in a Limited
Population of Patients.
 Allows HHS Secretary, at
request of the sponsor of
an antimicrobial or
antifungal drug to treat a
serious disease or
condition, to hold
meetings and make
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
Sec. 1081 – Priority Review
for Breakthrough Devices
 Creates a priority review
program for
breakthrough devices
which have no approved
alternative or offer
significant advances
over existing devices

Sec. 1082 – CMS Coverage of
Breakthrough Devices
[currently a placeholder]
Sec. 1101 – Accelerated
Approval for Breakthrough
Devices


The forthcoming placeholder section
could impact Medicaid coverage
policies.
The accelerated approval provision
could lower the evidentiary
standard for device approval.
The Medicaid population is
significantly different from the
privately insured population. There
are potential concerns about the
quality of evidence for device
approval as it pertains to the
device’s effects on Medicaid’s
generally frailer, sicker population. If
enacted, periodic surveillance
reports on adverse events,
outcomes, etc. for Medicaid and
Page 7 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
agreements regarding
clinical trial plans, drug
assessments, and postapproval meetings.
 These agreements can
allow the use
nontraditional endpoints,
phase 2 trial data, and
other data sources to
accelerate approval in
specific patient
populations.
 Any drug so approved
must have labeling
language indicating its
indication for use in a
limited and specific
patient population.
 These drugs may be
breakthrough therapies
under that pathway
designation and/or
biologics.
 Priority review remains
unchanged in Sec. 2181.
 CMS coverage of such
devices and the
accelerated approval
pathways are removed.
January 2015 Discussion
Draft Provisions


Allows HHS to approve
breakthrough devices
based on surrogate
endpoints that are
reasonably likely to
predict clinical benefit
Such approval may be
subject to post-approval
studies
Sec. 1121 – Expanded Access
Policy as Condition of
Expedited Approval
 Requires manufacturers
who receive a “covered
investigational drug”
designation to make
their patient access
policies to said
investigational drug
publicly available within
30 days of such
designation.
Sec. 1124 – Expanded Access
Task Force
 Establishes an Expanded
Access Task Force to
make one-time
recommendations to
Congress.
Subtitle L, Sec. 1221 –
Dormant Therapies
 Creates a “Dormant
Therapies” class with 15year exclusivity for drugs
that address one or
more unmet medical
NAMD Staff Comments on Discussion
Draft
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other vulnerable populations should
be considered.
In general, post-marketing
surveillance/reporting must be
robust and timely, with swift action
for any issues.
There may need to be additional
consideration as to what type
devices are permitted through this
pathway. Ex. Implantable devices
may need to be handled outside this
process or have additional scrutiny
before they are surgically implanted.
A “covered investigational drug”
should be treated as an
“investigational drug” for purposes
of the Medicaid outpatient drug
exclusion for investigational drugs.
States should have the flexibility to
decide their coverage policies for
such drugs.
If states are required to cover a
“covered investigational drug,”
there should be an enhanced rebate
for doing so.
The interaction of this provision with
the ability for manufacturers to
charge patients and payers for using
investigational drugs must be
considered. What are the potential
impacts on patients and payers? Is
there a limit on these access costs?
A 15 year exclusivity period for
potentially high-cost drugs could
severely disrupt pharmaceutical
market dynamics and place
significant strain on Medicaid
programs, which disproportionately
Page 8 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
 Now found in Sec. 2082 –
Expanded Access Policy
 Requires manufacturers
to make publicly available
within 60 days of
initiating a phase 2 or
phase 3 trial for an
investigational new drug
their policy for provision
of the drug.
 Legislation does not
guarantee access to any
individual patient.
 Does not address issues
raised by NAMD’s April
letter. Does not address
the potential interactions
with Medicaid or other
payers.
 Removed.
 As noted above, a
placeholder section
(Subsection I,
“Repurposing Drugs for
Serious and Lifethreatening Diseases and
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
needs, as determined by
HHS





Sec. 1241 – Extended
Exclusivity Period for Certain
New Drug Applications and
Abbreviated New Drug
Applications
 Extends exclusivity by 2
years for drugs which

cover the sickest and frailest
populations.
Medicaid relies on competition in
drug classes to secure supplemental
rebates and ensure access to
appropriate therapies. Lengthy
exclusivity periods make these
objectives more difficult to achieve.
Dormant therapies approved under
this provision should either be
considered “investigational drugs”
for Medicaid purposes, or else be
eligible for enhanced Medicaid
rebates.
Need additional clarification on
what sorts of therapies are intended
to be captured by this provision. It
is not clear whether this provision
precludes other competitor brands
for the same indication or if this is
meant to only prohibit generics for
dormant brands.
Would it be possible for a
manufacturer to provide a new
application for a therapy that has
been off the market for a period of
time and receive dormant therapy
approval? If so, is this intended?
Does this provision include
traditional drugs through NDA
approval and biologics assigned to
CDER (Center for Drug Evaluation
and Research) and CBER (Center for
Biologics Evaluation and Research)?
Allowing an additional 2 years of
exclusivity for drugs may delay the
introduction of generics into the
market and reduce overall
competition, which inhibits states’
abilities to negotiate supplemental
rebates. This in turn has a direct
Page 9 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
Conditions”) indicates
that congressional
leaders are still
negotiating this issue.
 Removed.
 A placeholder section
(Subsection I,
“Repurposing Drugs for
Serious and Lifethreatening Diseases and
January 2015 Discussion
Draft Provisions

make “significant
improvements” to
existing molecules
Includes new indications,
enhanced patient
adherence, reduced
public health risks,
reduced side
effects/adverse events
NAMD Staff Comments on Discussion
Draft




Sec. 1261 – Extension of
Exclusivity Periods for a Drug
Approved for a New
Indication for a Rare Disease
or Condition
 Extends exclusivity by 6
months for orphan drugs


impact on both federal and state
Medicaid expenditures (within the
pharmacy budget) and access to
appropriate therapies.
This provision provides additional
incentives for actions and practices
already underway in the
pharmaceutical market. Line
extensions of existing drugs are
already common occurrences in
drug development.
How does this provision interact
with the additional rebates
Medicaid receives for
pharmaceutical line extensions
under the ACA?
Who will determine whether the
drug makes a “significant
improvement”? FDA or the
manufacturer? The language of this
section suggests it is the latter. Is
this intended?
Can a drug given this status later
lose the designation if post
marketing studies show that the
drug does not represent a significant
improvement?
Allowing an additional 6 months of
exclusivity for drugs may delay the
introduction of generics into the
market and reduce overall
competition. This has a direct
impact on federal and state
Medicaid expenditures, as Medicaid
disproportionately covers the sickest
and frailest populations.
Congress may consider modifying
the 340B Drug Discount Program as
it relates to orphan drugs for the
ACA’s newly covered 340B entities.
There is confusion as to whether
Page 10 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
Conditions”) may revisit
the initial proposal.
 Removed in the second
draft, but reappeared in
the third.
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft

Sec. 2001 – Innovative Cures
Consortium
 Creates a public-private
partnership to accelerate
drug discovery and
development. Sunsets on
September 30, 2021.
 Membership includes
NIH, FDA, CMS, 22
appointed members – 5
federal agency
representatives; 8
biomedical
representatives; 9
academia/research,
patient, provider, health
plan representatives
 Consortium will award
grants and contracts to
small businesses and
nonprofits to accelerate
drug and device




340B pricing applies to orphan drugs
purchased by these entities for
treating a non-orphan condition.
HRSA maintains via an interpretive
rule that this is the case, but some
manufacturers disagree. This makes
it difficult for Medicaid agencies to
accurately determine which drugs
are eligible for Medicaid drug
rebates and which are not (due to
receiving the 340B price, which
makes a claim ineligible for
Medicaid rebates – the “duplicate
discounts” or “double-dipping”
issue).
Any action taken on 340B should not
further complicate the program’s
administration for state Medicaid
agencies.
A state Medicaid representative
should be a part of this body to
address issues of cost and access
from the state perspective.
Measures should be put in place to
minimize conflict of interest on the
consortium.
Staggered terms and the option to
reappoint existing members at the
end of their terms should be
considered to ensure continuity of
group and knowledge transfer.
The consortium’s grant and contract
program should reflect
considerations and issues unique to
the Medicaid program, particularly
in the delivery components of the
grants and contracts.
Page 11 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
 In new draft as Subtitle H,
“Council for 21st Century
Cures,” Sec. 1141.
 Creates a nonprofit
public-private
partnership which will
advise Congress
quarterly. It does not
retain grant-making
authority seen in the first
draft.
 Sunsets on September
30, 2023.
 All federal members of
the Council serve as exoficio members – heads
NIH, FDA, CMS, and 5
other federal agency
heads deemed to be
working on biomedical
research.
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
discovery, development,
and delivery
Sec. 2021 – Medical Product
Innovation Commission
 Creates a new
Commission, structured
similarly to MACPAC and
MedPAC, to make
recommendations to
Congress on drug
development.
Sec. 2085 – Expanding
Availability of Medicare
Data
 Sec. 2085(b)(1)(B)(ii)
grants the HHS Secretary
discretion to share
Medicaid and/or CHIP
claims data (to
supplement Medicare
data) with clinical data
registries to support
outcomes and patient
safety research.

A state Medicaid representative
should be a part of this body to
address issues of cost and access
from the state perspective.

Medicaid data can be highly variable
and dependent on state program
and population contexts. An
insufficient understanding of the
nuances of state Medicaid data can
produce an inaccurate picture of a
state’s program.
States should have the opportunity
to provide context for any data
requests.
Part of the data collection fees
should be shared with the states to
support their administrative costs in
fulfilling data requests.


Page 12 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
 Remaining 17 members
are appointed by the
Comptroller General – 4
from Pharma, 2 from the
device industry, 2 from
HIT, 2 academic
researchers, 3 patient
reps, 2 provider reps, 2
payer reps.
 Legislation details term
limits and transitions.
 Does not detail how to
minimize conflict of
interest or specifically call
on the Medicaid
perspective to be
represented.
Removed.
Removed.
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
Sec. 2121 – Authority for
Coverage with Evidence
Development for Medical
Devices under the Medicare
Program
 Allows Medicare to pay
for medical devices used
by patients in clinical
trials.
Sec. 2141 – Regulation of
Combination Products by
FDA
 Requires the FDA to
issue additional
guidance on the review
process for products that
combine drugs and
devices.






The impact of this policy on
Medicaid cost sharing for dually
eligible beneficiaries must be
considered.
This provision could require
Medicaid to pay, in part, for an
intervention without sufficient
evidence for normal coverage under
the Medicaid program.
Combination products potentially
pose a difficult reimbursement issue
for Medicaid programs. For
example, the device component of
the product may not need to be
replaced as often as the drug
component needs to be refilled, but
a product which packages these
components together requires
states to replenish both. This
scenario does not comport with
Medicaid’s statutory requirements
for efficiency and economy.
Combination products also pose
potential challenges for
coordination across Medicaid
medical and pharmacy benefits.
It would be helpful to clarify
whether FDA will approve
combination drug/device products
as a drug vs a device. If FDA
approves these as a drug, then
Medicaid will benefit from rebates
in exchange for coverage. If
approved as a device, then the
products would not be eligible for
federal rebates.
FDA should engage with state
Medicaid agencies during its
approval process for combination
therapies.
Page 13 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
Removed.
Removed.
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
Sec. 4181 – Advancing
Telehealth Opportunities in
Medicare
 Requires HHS to develop,
within 4 years, a
Medicare coverage and
payment methodology
for telemedicine services
that is equivalent to
face-to-face service
coverage and
reimbursement.
 Services that this
methodology apply to
will be selected by the
Secretary via
rulemaking.
 The Secretary may waive
originating site,
geographic, and/or
health provider
limitations in this
methodology.


Sec. 4281 – Establishing PDP 
Safety Program to Prevent
Fraud and Abuse in
Medicare Prescription Drug
Plans
 Creates a pharmacy lockin program for Part D
beneficiaries prescribed
controlled substances.
 Allows Part D plans to
suspend pharmacy
Though this provision does not
directly impact Medicaid, it could
provide a model for addressing
telemedicine issues in Medicaid in
the pharmacy space.
The impact on Medicaid’s provision
of cost-sharing for dually eligible
beneficiaries for these services
should be considered.
States are supportive of the
Medicare Part D lock-in provision.
Most states already have some type
of lock-in program for Medicaid
beneficiaries prescribed controlled
substances or where there may be
other patient safety or program
integrity concerns. A comparable
requirement on the Part D side
could help bring consistency across
the programs particularly as it
Page 14 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015
 Replaced by Sec. 3021,
“Telehealth Services
Under the Medicare
Program.”
 Requires the HHS
Secretary to submit to
Congress populations of
Medicare beneficiaries,
including duals, whose
quality of care could
benefit from increased
telehealth services; a list
of CMMI activities
relating to telehealth; a
list of procedure codes
and diagnoses suitable to
being furnished via
telehealth; and potential
barriers to more
widespread adoption of
telehealth services.
 Contains a Sense of
Congress that states
should collaborate to
create common licensure
requirements for
telehealth services to
facilitate practice across
state lines.
 Remains, now in Section
3151.
 Does not significantly
address NAMD concerns
raised in our April letter.
 Does grant the Secretary
authority to place
limitations on special
enrollment periods in
Medicare Part D for full
duals. The nature of
January 2015 Discussion
Draft Provisions
NAMD Staff Comments on Discussion
Draft
payments pending
investigation of credible
allegations of fraud.
Sec. 4284
 Requires e-prescribing of
covered controlled
substances.




Sec. 5001 – Extension of
Exclusivity Period for
American-Manufactured
Generic Drugs and
Biosimilars

Changes in Discussion
Drafts, April 29 and May 13,
2015
pertains to the dual eligibles,
these limits is left to the
improve patient care and safety, and
Secretary.
prevent inappropriate use. Lock-in
programs are helpful for clinical
coordination even in the absence of
fraud and abuse.
The distinction between the federal
definitions of controlled substances
versus state definitions, which may
be stricter, will need to be
considered.
Provider and pharmacy readiness to
meet the e-prescribing provision
must be considered. As there is
substantial overlap between
Medicare and Medicaid providers
and pharmacies, Medicaid will be
impacted by this requirement and
may potentially have to provide
education and support to comply
with it.
This state effort to ensure provider
capacity and infrastructure
readiness for e-prescribing should
have federal support.
What occurs if pharmacies are
unable or unwilling to accept eprescriptions? Pharmacies are the
primary bearers of transaction costs
in an e-prescribing environment.
Non-participation could seriously
disrupt access to medications for
dually eligible beneficiaries, which
are among Medicaid’s most
vulnerable populations.
Removed.
Though currently vague, this
provision could delay introduction of
additional generics and biosimilars
to the market. These products are
key to maximizing value in Medicaid
pharmacy budgets.
Page 15 of 16
January 2015 Discussion
Draft Provisions



NAMD Staff Comments on Discussion
Draft
Placeholder section will

define “American
manufactured drug” for
purposes of exclusivity
Provides designated
“Americanmanufactured” generics 
or biosimilars an as-yetunspecified exclusivity
extension
This extension is not
applicable to drugs
which have received a
separate exclusivity
extension or to drugs
whose filed application
is licensed for a change
resulting in a new route
of administration, dosing
schedule, dosage form,
delivery system, delivery
device, or strength.
How would this provision be
monitored and enforced? Many
manufacturers are headquartered in
other countries and may have one
plant in US and others in other
countries.
Additional Medicaid rebates or an
enhanced FMAP should be
considered for these products.
Page 16 of 16
Changes in Discussion
Drafts, April 29 and May 13,
2015