DoD Rethinks Drug Price Caps Implementation

WASHINGTON (CN) - The Defense Department is considering adding methods for implementing federal price ceilings on TRICARE retail prescriptions, under a U.S. District Court ruling, and requests comment.

Under a 2008 law, retail pharmacies taking TRICARE insurance must abide by the caps when filling prescriptions. The Defense Department implemented the law in 2009, by requiring drug manufacturers to refund to the department any amounts above those caps that TRICARE has paid out for prescriptions.

Although drug companies signed voluntary agreements covering approximately 99 percent of TRICARE retail prescriptions, the rule's validity had already been questioned in "Coalition for Common Sense in Government Procurement v. U.S.", requiring a finding by the U.S. District Court for the District of Columbia.

The court ordered the Defense Department to consider other approaches, besides using refunds, that may be used to effect the price caps, and "which of the five parties that participate in the retail pharmacy program--manufacturers, wholesalers, network pharmacies, private pharmacy benefit managers, and TRICARE beneficiaries--must bear any costs associated with imposing the Federal Ceiling Prices.''

The department requests public comment on these matters.

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