Contract Pharmacy Network Optimization
Definition
Contract pharmacy network optimization involves a systematic review of a covered entity’s existing contract pharmacy arrangements to identify opportunities to improve patient access, increase 340B capture rates, and enhance program savings. It considers factors such as the geographic distribution of pharmacies relative to the patient population, pharmacy performance data, dispensing fee structures, and the impact of manufacturer restrictions.
Optimization may involve adding new contract pharmacies in underserved areas, restructuring existing arrangements to improve performance, renegotiating dispensing fees, or addressing manufacturer restrictions through strategic pharmacy selection. It also involves evaluating whether the current network is capturing all eligible prescriptions or whether patients are filling 340B-eligible prescriptions at non-contract pharmacies.
With manufacturer restrictions limiting access to 340B pricing through contract pharmacies for certain drugs, optimization now also involves evaluating which pharmacies can access pricing for restricted drugs and how to structure the network to maximize savings within restriction parameters.
Frequently Asked Questions
Why Contract Pharmacy Network Optimization Matters
The contract pharmacy network is often the largest driver of 340B savings for non-hospital covered entities. An unoptimized network may leave significant savings unrealized. Manufacturer restrictions have made network optimization more complex and more important than ever.
How Virtue 340B Uses It
Virtue 340B helps covered entities evaluate and optimize their contract pharmacy networks as part of our program consulting services, identifying opportunities to improve savings and access while maintaining compliance.