LDD (Limited Distribution Drug)
Definition
Limited Distribution Drugs (LDDs) are pharmaceuticals that manufacturers have designated for distribution only through a restricted network of specialty pharmacies or distributors, rather than through standard wholesale channels. LDDs are typically high-cost specialty medications, often with REMS programs or complex handling requirements.
In the 340B context, LDDs create access challenges because the restricted distribution network may not include the covered entity’s contract pharmacies or standard wholesaler. Covered entities must identify which of their drugs are LDDs and establish compliant 340B purchasing and dispensing arrangements within the restricted distribution network.
Manufacturer restrictions have added additional complexity for LDDs, as some manufacturers have further limited 340B access to specific pharmacies within their already-restricted distribution networks.
Frequently Asked Questions
Why LDD (Limited Distribution Drug) Matters
LDDs represent significant savings opportunities but require special arrangements to access 340B pricing. Covered entities with high LDD volumes must proactively manage their access arrangements to capture available savings.
How Virtue 340B Uses It
Virtue 340B helps covered entities identify LDDs in their formularies and evaluate their access arrangements for these drugs as part of our program optimization services.