News & Events

PHSL to Attend 2024 NACDS Total Store Expo

PHSL President Ann Johnson, Vice President Melissa Krause, Co-Founder Tim Kosty, Senior Consultant Patty Milazzo, and Director of Business Development Karlo Zovko will be attending the 2024 NACDS Total Store Expo on August 17th – 19th in Boston, MA. PHSL will have an exhibit set up at booth #2006. If you would like to schedule a meeting with a PHSL team member, please click here to send us a message.

To learn more about this conference, visit the Total Store Expo website at

Pharmacy Technology & Management Review May/June 2024

PHSL Senior Consultant Patricia Milazzo contributed to the May/June 2024 edition of Pharmacy Technology & Management Review (PTMR). In her Viewpoints article, Patricia discusses pharmacy revenue opportunities through a variety of travel health services as international travel is expected to increase in 2024.

Click here to read the article “International Travel — Pharmacy Opportunities.”

Federal Trade Commission Eyeing Drug Patents in Orange Book

The Federal Trade Commission (FTC) has taken the position that certain drug-device patents are not legitimate.  Asthma and COPD inhalers, obesity and type-2 diabetes injectables, glucagon nasal spray, epinephrine autoinjectors, and other drug-device combinations have recently been in the crosshairs of the FTC.   This has created controversy regarding hundreds of patent listings within the Food and Drug Administration’s “Approved Drug Products with Therapeutic Equivalence Evaluations,” commonly known as the Orange Book.

The FTC has long been dedicated to creating a free and fair marketplace.  The commission argues that the “illegitimate” patents block the FDA from approving a generic product for 30 months, due to legitimate patent holders’ ability to block such entry into the market through the FDA.  This is accomplished by filing an infringement lawsuit.  The regulatory commission has issued two rounds of letters to various manufacturers questioning the accuracy of their patents in an effort to promote fair competition in the marketplace.

In November of 2023, the FTC identified over 100 patents in the Orange Book, which are held by manufacturers of brand-name drug-device products. The commission then sent out warning letters to inform the respective manufacturers that it had submitted patent listing dispute communications to the FDA.  The FTC did not provide manufacturers with an extensive list of all patents the commission believed to be inaccurately filed, so it was then up to the manufacturers to verify the accuracy of each of their patents.  Some manufacturers complied with the letters and delisted patents.  Others chose to proceed with the other options in the FDA’s process, which gives the patent holder 30 days to either amend the patent listing or certify under penalty of perjury that the listing complies will all applicable regulatory and statutory obligations.  As of May 2024, the FTC has not taken further action against companies who refused to remove patents after receiving warning letters in November of 2023.

In April of 2024, the FTC again sent out warning letters to drug manufacturers whose patents are listed in the Orange Book.  This time, over 300 patents are being targeted by the FTC and are having their accuracy disputed.  It appears that the manufacturers who received letters are taking time to review them and determine a course of action.  The FTC is challenging the patents through the FDA’s process, despite explicitly stating that it reserves the right to escalate the situation and challenge the patents through Section 5 of the Federal Trade Commission Act.

A challenge through Section 5 of the Federal Trade Commission Act would be difficult for the FTC to execute.  First, the commission would have to develop a case to substantiate its claim that “only patents that claim active ingredients should be listed in the Orange Book.”  This will prove to be especially arduous, as the FDA has remained silent despite requests from the industry to provide guidance relating to listing drug-device patents.  Since the FDA is considered the expert arbiter when it comes to matters of the Orange Book, the FTC’s opinions of which type of patents are permissible in the Orange Book may be irrelevant.  Even in the event that drug-device patents are determined not to be listable, the patents still may not violate antitrust laws.  Case law in re Lantus Direct Purchaser Antitrust Litigation, Case No. 18-2086, held that pharmaceutical companies that wrongfully list patents in FDA’s Orange Book must prove that they acted in good faith in order to avoid any antitrust liability.  This means that any drug-device patents listed in the Orange Book in good faith would not be subject to consequences of violating antitrust regulations.

Despite the uphill battle for the FTC to prove antitrust violations, the commission is determined to continue its fight against patents it views as improperly listed and remains committed to identifying more patents that it believes are inappropriately listed in the Orange Book.  The FTC may even review patents that cover manufacturing processes, packaging, and Risk Evaluation and Mitigation Strategies (REMS).

The FTC’s public denunciation of these patents appears to be one of the biggest threats to patent holders.  The negative publicity is costing manufacturers valuable goodwill.  Even if the FTC escalates to the point of litigation, the outcome of the litigation could be secondary to damage done to the reputation of the manufacturer.  For this reason, pharmaceutical companies should be extraordinarily cautious to ensure that they are filing patents in good faith.  Filing of infringement action on an existing patent that clearly violates the FDA’s guidelines for filing in the Orange Book will likely be subject to a myriad of legal obstacles from multiple stakeholders including the FTC, generic applicants, and purchasers.

How the FTC will choose to handle patent holders who do not respond to their warnings is yet to be seen.  Its efforts have been successful in garnering some voluntary compliance from its subjects.  While further escalation appears unlikely, it cannot be ruled out.  Patent holders should operate under the assumption that their actions will be viewed under extreme scrutiny by the FTC.  PHSL will continue to follow the actions of the FTC.  What do you think the FTC will do to patent holders who do not delist their patents?  Should drug-device patents be listed in the Orange Book?  How could a future ruling against drug-device patents impact the industry?


Posted June 10, 2024

Spring 2024 Newsletter:

Is a New Pathway for OTC Coverage Coming?

PHSL to Attend 2024 NACDS Total Store Expo

Is a New Pathway for OTC Coverage Coming?

What do the IRS (Internal Revenue Service) and OTC products have in common? Let us fill you in on their new relationship. On October 4, 2023, the IRS published a Request for Information (RFI) in the Federal Register. The IRS was seeking information regarding insurance coverage of OTC preventative items and services without cost sharing and without a prescription.

Key Takeaways for Stakeholders

  • Three of the top federal agencies (Department of the Treasury, Department of Labor, and Department of Health and Human Services) are interested in the expansion of health insurance OTC benefits.
  • At first glance, the scope of coverage appears to be limited to OTC contraceptives, smoking cessation agents, and diagnostic tests (like COVID-19 tests); however, the proposal uses broad language to allow for expanded coverage of other OTC products that have not yet been identified.
  • Stakeholders who need to track the final ruling and prepare for implementation include:
    • OTC manufacturers whose products have potential to be seen as preventive products. This would include manufacturers of vitamins, OTC contraception products (foam, condoms, OTC oral contraceptives), baby aspirin, OTC acid reflux products, and OTC topical antibiotics, as examples.
    • Payers and PBMs who need to prepare for the expectation of covering these OTC products.
    • Pharmacies that may see an increase in OTC product requests.
    • Compendia providers who may receive more OTC listing requests. In order for pharmacies to process the OTC coverage, the products must be listed with the major drug pricing compendia who provide NDC (National Drug Code), UDI (Unique Device Identifiers), and pricing information, which would be required for a pharmacy to bill a payer.


The proposed rule was jointly issued by the IRS (Treasury Department), The Employee Benefits Security Administration (Department of Labor), and the Department of Health and Human Services (HHS). The RFI seeks insights regarding the application of the preventive services requirements under Section 2713 of the Public Health Service Act (PHS Act) for OTC preventive items and services available without a prescription by a health care provider.

Public comments were accepted until December 4, 2023. Approximately 391 comments were received and can be found at If passed, new regulations will require insurance and health plans to cover certain OTC products ordered with or without a prescription and with limited or no-cost sharing for the patient.

The impact of the proposed rule will affect more than just payers responsible for the new insurance coverage. If approved, the processing of OTC products will impact every player in the current prescription processing model. OTC manufacturers, payers, PBMs, EHRs, pharmacies, and the pricing compendia will all be required to enhance systems to enable the ordering, dispensing, and adjudication of the mandated OTC products.

Included OTCs

Each of the past and current initiatives described in the RFI contains one or more specific preventive OTC products (e.g., folate) or a preventive category (e.g., contraception). All of the following are mentioned in at least one or more initiatives.

  • Certain types of tobacco cessation pharmacotherapy, which are currently recommended by the USPSTF (United States Preventive Services Taskforce) with an A-rating for nonpregnant adults who use tobacco.
  • Folic acid supplements, which are recommended by the USPSTF with an A-rating to prevent neural tube defects for all persons planning to or who could become pregnant.
  • The guidelines for women’s preventive health services adopted and released by the Health Resources and Services Administration (HRSA Guidelines) include recommendations for:
    • OTC preventive products, such as breastfeeding supplies (for example, breast pumps and breast milk storage supplies)
    • Certain contraceptives
    • Coverage of the OTC progestin-only daily oral contraceptive recently approved by the Food and Drug Administration.

Expansion of OTCs

The RFI appears to leave two doors open so expansion of covered products may occur. First is the statement containing the verbiage “….including other OTC preventive products as they might become available on the market.” Second, Section 11-A Solicitation of Comments, uses the term “preventive products” but does not define the term.

“When coverage is offered for OTC preventive products that are prescribed by a health care provider, do cost sharing or other aspects of coverage vary by type of OTC preventive product? For example, are different cost-sharing requirements or medical management techniques imposed for OTC tobacco cessation products than for OTC breast pumps? Do coverage requirements or medical management techniques differ across different types of OTC contraceptives, such as between emergency contraception and condoms, or between medications and devices? What medical management techniques do plans and issuers commonly apply to OTC preventive products when the items are prescribed?”

Scope expansion can easily occur beyond the products specifically mentioned in the RFI. Does aspirin qualify as a preventive medication for heart attacks? Melatonin to prevent sleep deprivation? Topical antibiotics to prevent a topical skin or wound infection? Fish oil for heart health or other vitamin formulations, particularly if a health care practitioner provides a prescription?

Most of the 391 comments requested expansion of these types of OTC products and asked to address the aging population and why this group was not identified as one of the specific populations who have additional or disproportionately burdensome challenges to access OTC preventive products. Commonly mentioned products for this population included vitamins for bone strength, hearing and vision aids, and incontinence products.


PHSL recommends OTC manufacturers pay close attention as this RFI moves through the regulatory process. Three large federal agencies are involved, which significantly increases the possibility of this initiative becoming a law. OTC products have been in the spotlight lately on a variety of fronts – the FDA has already approved an OTC oral contraceptive. Health plans are expanding their focus to provide healthcare in underserved populations and communities, which is a major component of the proposal. Technical standard organizations are reviewing the current prescription adjudication electronic system for necessary modifications to seamlessly integrate OTC processing.

PHSL is poised to help OTC manufacturers list their products within the leading pricing compendia and will continue to monitor and report as information becomes available. Contact us if you’d like to learn more.


Posted June 10, 2024

Spring 2024 Newsletter:

Federal Trade Commission Eyeing Drug Patents in Orange Book

PHSL to Attend 2024 NACDS Total Store Expo

Pharmacy Technology & Management Review March/April 2024

PHSL President Ann Johnson and University of Pittsburgh Pharm.D. Candidate Sydney Stawarz contributed to the March/April 2024 edition of Pharmacy Technology & Management Review (PTMR). In their Viewpoints article, Ann and Sydney discuss the risks of using ChatGPT for medication information and provide alternative, reliable sources that pharmacists can utilize and recommend to their patients.  Click here to read the article “ChatGPT — The New Source for Inaccurate Drug Information.”

NCPDP recognized PHSL Senior Consultant Dave Schuetz

Congratulations to PHSL Senior Consultant Dave Schuetz for being recognized by NCPDP as Most Valuable Participant (MVP) for dedication as a task group leader for the WG2 Product Review and Billing Unit Exception Task Group at the February 2024 Work Group meeting.  Thanks for all of your efforts and leadership!



Posted: February 2024

Medicare Prescription Payment Plan…aka OOP Price Smoothing presented at ASAP by Ann Johnson

PHSL President Ann Johnson presented at the American Society for Automation in Pharmacy (ASAP) 2024 Annual Conference. Ann’s presentation discussed the Inflation Reduction Act’s “price smoothing” provision, including implications for patients, payers, and pharmacies.

Click here to view Ann’s presentation slides.

Pharmacy Technology & Management Review January/February 2024

PHSL Senior Consultant Patricia Milazzo and PHSL Intern Logan Graham contributed to the January/February 2024 edition of Pharmacy Technology & Management Review (PTMR). In their Viewpoints article, Patricia and Logan discuss opportunities for pharmacies to bill for clinical services through medical billing and the challenges of incorporating the process into their pharmacy system and workflow.  Click here to read the article “Pharmacy and Medical Billing.”

Florida Medication Importation Approved by FDA

On January 5th, the Food and Drug Administration (FDA) announced approval for the state of Florida to purchase and import medications in bulk from a Canadian wholesaler. This approval limits the import use to Florida’s Medicaid program, government clinics, and state prisons.

FDA Importation History

In 2020, the FDA approved plans to allow states to establish prescription drug import programs with the intended goal of reducing drug prices for US citizens. Florida was the first state to apply for approval in 2020. The federal court issued a January 5, 2024 deadline for the agency to rule on the state’s application after Florida sued the agency for “reckless delay.” Florida estimates the state would save approximately 150 million dollars on drugs to treat HIV, AIDS, diabetes, hepatitis C, and certain psychiatric conditions. As of January 2, 2024, Colorado, New Hampshire, Texas, and Vermont have applications in various stages of the approval process.


Per Dr. Robert Califf, FDA commissioner, the agency will perform a serious vetting of applications for public health protection. States will be required to provide importation details to ensure the drug’s potency, how the state’s program will prevent counterfeit products from entering the United States, and what drugs the state seeks to import. The Canadian seller who purchases the drug directly from the manufacturer must be identified. In addition, the proposal must demonstrate where and how significant cost savings for consumers would occur. US product labeling must be approved and put on the medications. The FDA will be monitoring the state for adherence to federal regulations, especially mandatory reporting of adverse drug events.

Certain drugs are excluded for importation.

  • Controlled substances (all)
  • Biological products including insulin
  • Infused or intravenously injected drugs
  • Inhaled drugs used during surgery
  • Any drugs assigned a REMS (risk evaluation and mitigation strategies)

PHSL assumes the focus of importation will be single-source brand drugs that are available in both the US and Canada in the same active ingredient, strength/concentration, route of administration, and dosage form. This would likely include oral maintenance therapies for chronic conditions that are frequently prescribed and dispensed to maximize the program impact. While there may be instances of multisource generic drugs that are less expensive in Canada, the general knowledge has been that US generics are competitive or less expensive at the pharmacy.

Even with FDA approval, importation is complex, with additional requirements for states who want to participate. After the 2020 ruling, Canada enacted a law to prevent manufacturers and wholesalers from exporting drugs which are in short supply. Some pharmaceutical companies have contractual arrangements with drug-shipping companies prohibiting deliveries to the US. Additional lawsuits are expected to be filed. PhRMA, Pharmaceutical Research and Manufacturers of America, has announced it will “consider all options” to prevent importation, including taking legal action.

Mandatory State Requirements for the FDA

  • What drugs does the state seek to import?
  • Who is the Canadian seller and does this Canadian seller purchase the drug directly from its manufacturer?
  • Who is the importer in the U.S. that would buy the drug directly from the foreign seller in Canada?
  • Who is the relabeler responsible for meeting U.S. labeling requirements?
  • Who is the qualifying lab that would conduct testing of the drug for authenticity and degradation?
  • How is the supply chain secured against counterfeit products? (remember, DSCSA is in place in the US and includes 2D barcode requirements)
  • SIP (Section 804 Importation Programs) would initially be authorized for 2-year periods with the possibility of 2-year extensions.
  • Post-importation requirements for each drug include:
    • Consumer cost savings reports
    • Adverse Event Reporting on Canadian products

Imported Prescription Operations and Billing

The importation ruling creates unanswered questions for pharmacies, regardless of location or type of pharmacy, in addition to PBMs (prescription benefit mangers), wholesalers, payers, and government agencies other than the FDA. Clarification is particularly needed around digital data requirements. The scope of potential system enhancements is unknown. Canadian imports will need to conform to current standards for electronic prescribing, product tracking, dispensing, labeling, and billing, or systems will need enhancements if the data is not in compliance with current US industry standards.

Examples of digital integrity issues may include:

  1. Are new NDCs (National Drug Code) assigned to imported products? (this was the case for varenicline during the shortage where the FDA permitted Canadian product to be sold in the US)
  2. Will the NDC be identified as an “imported repackaged NDC” by the compendia NDC databases?
  3. Will the FDA provide an electronic identifier that would flag imported products? If not, what data will be used to identify imported products in the electronic prescription ecosystem?
  4. Is the process for ADR reporting the same as domestic products?
  5. Will there be new pricing benchmarks?
  6. Will or how will CMS (Centers for Medicare and Medicaid Services) include imports in calculating NADAC (National Average Drug Acquisition Cost)?
  7. Can organizations “force” patients to use imported products or can a patient opt-out of using a Canadian product?

Other unresolved issues remain.

  1. How to calculate the FDA-required “consumer savings”
    • How will savings be passed to the consumer? Florida’s Medicaid program, government clinics, and state prisons are less like commercial and Medicare Part D plans where tiers and copays influence patient costs and options. This requirement to pass, document, and report savings to the consumers will become a more relevant requirement if imported drugs are allowed for commercial use in non-government owned pharmacies open to the public. If general use is permitted, the state will be required to calculate and report savings to the consumers.
  2. Industry guidance on product returns and reverse logistics processes including recalls.

Importation has periodically been proposed as a viable method of lowering drug costs going back to the early 2000s, but it remains to be proven if the obstacles can be overcome on both sides of the border. Will consumers actually see a reduction in prescription costs? More to come!


Posted January 26, 2024

Winter 2024 Newsletter:

Pharmacy Network Strategy

Pharmacy Network Strategy

As the pharmacy benefits management (PBM) industry has become increasingly consolidated, entering into a pharmacy network agreement becomes increasingly challenging for pharmacies, especially independent pharmacies that lack the volume of their large chain competitors. The top three PBMs – Caremark (CVS Health), Evernorth/Express Scripts (Cigna), and OptumRx (United Healthcare) control 79% of total prescription claims managed. The next top three PBMs – Humana Pharmacy Solutions, Prime Therapeutics/Magellan Rx, and MedImpact control 17% of total prescription claims managed. This leaves just 4% of the market share managed by all other independent PBMs (and cash pay).1 While challenging, there are still inroads to PBM networks, and this article discusses these considerations.

Approximately half of all states in the United States have some variation of Any Willing Provider (AWP) regulations for fully insured plan sponsors/payers. It is important to understand that AWP laws require fully insured/ managed care plans to accept any qualified provider who is willing to accept the terms and conditions of that pharmacy benefit plan. The pharmacy, particularly an independent or small chain with relatively low volumes, will typically not have the opportunity to negotiate more favorable terms and conditions or drug reimbursement levels.

PSAOs are the typical option for retail pharmacy PBM network inclusion; however, the contract terms can be disadvantageous from a reimbursement or preferred status standpoint. Specialty pharmacies are not typically included in PSAO-negotiated PBM arrangements.

One way to potentially tip the scale in a pharmacy’s favor is to differentiate as a specialty pharmacy, specifically if the pharmacy can focus on value-added clinical programs (e.g. utilization management, outcomes based, etc.). Hospital pharmacies that service the specialty prescription needs of outpatients of 340B covered entities may find it worthwhile to gain entry to PBM networks, instead of contracting this function out.

Entering Medicaid networks requires a state-by-state approach. Just because your pharmacy may contract with a PBM that services managed Medicaid or Fee-For-Service (FFS) Medicaid plans, your pharmacy will not automatically gain entry into these networks.

With so many considerations that can impact a pharmacy’s network strategy, it is helpful to start with a clear understanding of your pharmacy’s product and payer mix. With this in mind, the pharmacy is positioned to consider focusing their efforts on certain products and/or payers (e.g., commercial vs. government).

PHSL can serve as your resource, assisting with opportunity identification or helping to develop a specific network entry strategy.

1 Drug Channels, May 23, 2023.


Posted January 26, 2024

Winter 2024 Newsletter:

Florida Medication Import Approved by FDA