Legal Update, August 2019

Legal Update

Factor Loans During Emergencies: Truth and Fiction
By Elizabeth “Issie” Karan

Hemophilia Treatment Centers (HTCs) sometimes must help patients in emergency situations obtain factor. When patients show up in the emergency department or have an unexpected medical event, HTCs prioritize patient well-being over everything else (as they should). However, HTCs should try to mitigate compliance risk as much as possible and utilize best practices if a short-term loan is necessary to keep patients stable.

HTCs which loan factor to another entity may face findings of diversion and/or obligations to repay manufacturers’ discounts under the 340B Discount Drug Program. Depending on how policies and procedures define “material” breaches, HTCs also may be obligated to make a self-disclosure to HRSA. Loans to entities which are not eligible for 340B likely violate the statutory requirement that all covered drugs purchased under the 340B Program be provided only to patients of the covered entity. However, even the provision of 340B-purchased factor to another covered entity, which is eligible for the 340B program, creates risk.

No specific guidance exists in the 340B Program regarding the sharing of inventory among covered entities during emergency situations. However, FAQ 1197 on the Apexus website indicates that a single organization with multiple, unique 340B IDs should not transfer 340B-purchased drugs among those IDs, given that their patient populations and scopes of project may differ. However, the same FAQ states that HRSA may consider approving an inventory sharing/transfer agreement between unique 340B IDs on a case-by-case basis.

In informal technical assistance conversations, Apexus explained that the appropriate approach to loaning 340B-purchased inventory varies by: (1) the status of 340B eligibility for each entity; (2) the type of covered entities involved; and (3) the inventory model utilized by each entity (i.e. virtual versus physical). For example, if one covered entity maintains neutral, virtual inventory, then a loan of 340B-purchased product, which is replaced with inventory purchased at WAC with the same NDC and within a 72-hour timeframe, may be allowable. Apexus also indicated that strong policies and procedures on this topic are advisable. Finally, HTCs may wish to consider if contract pharmacy partners also could help provide rapid response to emergency factor needs.

If your HTC wishes to be able to lend factor in emergency situations, please contact us and/or Apexus for help understanding the compliance challenges and the best ways to codify the process in policies and procedures.

Also in this Issue…

Notes from Joe
· The More Things Change…

Alliance Update
· We are Growing!
· Save the Date for an Alliance Session at the ASH Meeting on Making the Running of an HTC Tolerable

Operations Update
· Reminder: Sharing HTC Information: Caution is the Best Policy
· Save the Date for an Alliance Session at the ASH Meeting on Making the Running of an HTC Tolerable

Washington Update

Payer Update
· Payer Relations Update

Team Alliance Contact Information

We work for you! Please don’t hesitate to contact any of us with any questions or concerns:

Name Email Phone
Joe Pugliese 215-439-7173
Sean Singh 727-388-7326
Jeff Blake 317-657-5913
Jeff Amond 608-206-3132
Johanna Gray, MPA 703-304-8111
Elizabeth Karan 612-202-3240
Roland P. Lamy, Jr. 603-491-0853
Dr. George L. Oestrich, Pharm.D., MPA 573-230-7075
Ellen Riker 202-257-6670
Mark Plencner 701-318-2910
Kimberly Wolverton Lackman
Michael B. Glomb 202-466-8960
Theresa Parker 727-688-2568
Karen Bowe 717-571-0266
Joel Bellucci 727-504-0491