1 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP DEFENSE LOGISTICS AGENCY AMERICA’S COMBAT LOGISTICS SUPPORT AGENCY DEFENSE LOGISTICS AGENCY AMERICA’S COMBAT LOGISTICS SUPPORT AGENCY WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT Medical Prime Vendor – Order Process Flow

2 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP 2 –Pharmaceutical Prime Vendors: AmerisourceBergen Cardinal Health McKesson Dakota (Small Business) DMS –Medical/Surgical Prime Vendors: Owens & Minor Cardinal Health Midwest Medical American Medical Depot Medical TVR Programs

3 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP 3 Medical Prime Vendor Manufacturer DSCP Manufacturers Prime Vendor Distributor Prime Vendor Customer Payment w/in 15 days 5 “810” Invoice 6 8 FA Monthly Billing (via DFAS) “527R” Receipt Confirmation 2“850” Sales Order 3 “855” Purchase Order Confirmation (Prices Locked) 4 Next Day Delivery ORDERING STEPS 1 st PricingDSCP PPV & DMLSS 2 nd 850CUSTOMER PPV 3 rd 855PPV CUSTOMER 4 th DeliveryPPV CUSTOMER 5 th 810PPV DSCP 6 th 527 RCUSTOMER DSCP 7 th 820DSCP PPV 8 th Monthly DSCP CUSTOMER Rolled-Up Bill ORDERING STEPS 1 st PricingDSCP PPV & DMLSS 2 nd 850CUSTOMER PPV 3 rd 855PPV CUSTOMER 4 th DeliveryPPV CUSTOMER 5 th 810PPV DSCP 6 th 527 RCUSTOMER DSCP 7 th 820DSCP PPV 8 th Monthly DSCP CUSTOMER Rolled-Up Bill Pricing File Comfirmation Credit or Regular Funds 865-PO Change Request From PV 997-Functional Acknowledgement PRICING STEPS A FSSDVA DSCP B DAPAMANU DSCP PRICING STEPS A FSSDVA DSCP B DAPAMANU DSCP Distribution And Pricing Agreements (DAPA) B Department of Veterans’ Affairs (DVA) Federal Supply Schedule (FSS) A Medical Reconciliation Application Allows documents to be reviewed prior to processing to EBS Vendor and DSCP have access Assures we have correct information going to EBS Medical Reconciliation Application Allows documents to be reviewed prior to processing to EBS Vendor and DSCP have access Assures we have correct information going to EBS

4 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP 4 What Happens in EBS Let follow the 8 basic steps from customer to vendor to EBS Steps: –1- Pricing file provided to customer –2 - Customer places order – EDI 850 –3 - Prime Vendor acknowledges order – EDI 855 –4 - Prime Vendor delivers product –5 - Customer receipts for orders - EDI 527R –6 - Prime vendor invoices – EDI 810 –7 - DLA pays vendor –8 - DLA bills customer

5 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP 5 Step 1 - Provide Pricing Files to Customers Distribution and pricing agreements (DAPA): –Established with Pharmaceutical and Medical/Surgical manufacturers and distributors. –Holder allows prime vendors to: Sell products to customers At price as established in the agreement –Items on Agreements: Pharmaceutical – 29,000 (approx) Medical/Surgical – 118,000 (approx) Federal Supply Schedules

6 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 2 - EDI 850 Creates TVR Order Line Item Detail Net Value of Order Sold-to and Ship-to

7 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 3 - EDI 855 Order Acknowledgment EDI 855 Interfaces into EBS Multi lines per Idoc Example of data on Idoc for line 1. Key information: Quantity Price – Customer price Fill/kill quantity Document number Now EBS purchase order will create! EDI 855 Interfaces into EBS Multi lines per Idoc Example of data on Idoc for line 1. Key information: Quantity Price – Customer price Fill/kill quantity Document number Now EBS purchase order will create!

8 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 3 - EDI 855 Creates Purchase Order EBS Purchase Order and obligation Created Step 4 Vendor can now deliver the products J8P – TVR, PV, IPV, and PBL processes Module 2 – Prime Vendor Processes

9 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 5 - EDI 527 Customer Receipt Customer Receipt Interfaces into EBS Customer Billing Vendor Payment Receipt idoc Customer Receipt Interfaces into EBS Customer Billing Vendor Payment Receipt idoc J8P – TVR, PV, IPV, and PBL processes Module 2 – Prime Vendor Processes

10 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 6 EDI 810 Vendor Invoice Vendor Invoice

11 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 7- Vendor Payment Step 7 Vendor Payment Payment based up 3 way match. Must have obligation, receipt and invoice. Payment processed on: 4/23/2010 Step 7 Vendor Payment Payment based up 3 way match. Must have obligation, receipt and invoice. Payment processed on: 4/23/2010

12 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP Step 8 – Customer Billing EDI 855 – Bring in price – incl. surcharge TVR Price - inbound – reflects price *based on pricing agreements TVR Price (w/o CRR) – what we will pay vendor. Billing – Based upon TVR Price - Inbound EDI 855 – Bring in price – incl. surcharge TVR Price - inbound – reflects price *based on pricing agreements TVR Price (w/o CRR) – what we will pay vendor. Billing – Based upon TVR Price - Inbound J8P – TVR, PV, IPV, and PBL processes Module 2 – Prime Vendor Processes

13 WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT WARFIGHTER-FOCUSED, GLOBALLY RESPONSIVE, FISCALLY RESPONSIBLE SUPPLY CHAIN LEADERSHIP 13 Medical – Wrap Up Prime vendor is a large part of the Medical business customers world wide There are various ways customers can order: –DMLSS Retail is the primary method. –Vendor Websites –TAMMIS; TWELS, EMALL –Manual Orders: Fax and phone All documents pass thru the Medical Reconciliation Application (MRA) prior to processing to EBS. All orders are at the line item level