National Drug Code (NDC)
Definition
The National Drug Code (NDC) is a unique identifier for human drug products in the United States. It consists of three segments: the first segment (5 digits) identifies the manufacturer or labeler; the second segment (4 digits) identifies the drug product (strength, dosage form, formulation); and the third segment (2 digits) identifies the package size.
In the 340B program, NDCs are used extensively: to identify covered outpatient drugs eligible for 340B pricing; in split-billing software to match dispensing events to specific drug products; in purchasing records to document which drugs were bought at 340B prices; and in orphan drug exclusion determinations for hospital-type entities.
NDC management is a critical data integrity function. Incorrect NDC mappings in split-billing software can cause drugs to be incorrectly classified as covered or non-covered outpatient drugs, affecting eligibility determinations. New NDCs (for new formulations or package sizes) must be added to the software configuration promptly.
Frequently Asked Questions
Why National Drug Code (NDC) Matters
NDCs are the primary drug identifier in 340B purchasing and compliance tracking. Incorrect NDC mappings in split-billing software are a common source of eligibility determination errors. Ongoing NDC management is an essential compliance activity.
How Virtue 340B Uses It
Virtue 340B reviews NDC mappings and configurations in split-billing software as part of our audit and monitoring services, identifying mapping errors that affect eligibility determinations.