1. Communication is the Key Pharmacy Purchasing Pearls Marvin Finnefrock, PharmD Steven L. Gratch, Pharm. B.Sc., R.Ph. Diane Daskey Joanie MacIntosh, CPhT

2. Learning Objectives (for Technicians & Pharmacists)  At the end of this activity, the participant will be able to: Describe the role of the pharmacy buyer in preparing for P&T meetings. Outline the communication relationships between manufacturer, wholesaler, GPO, pharmacy buyer, pharmacy staff, clinical pharmacists, and pharmacy director. Differentiate circumstances and situations that may be managed by the pharmacy buyer versus clinical pharmacists versus pharmacy management. Describe the “glue” required for effective communication within and outside of the pharmacy department.

3. Presentation Overview Patient Buyer and pharmacy team Medical and Nursing Staff Administration Vendors and GPO

4. Buyer Support for the Clinical Pharmacist  The clinical specialist should work very closely with the Pharmacy buyer/purchasing agent  Tell them what they do not know  Think outside the package  Know the formulary and empower yourself

5. The Connection Between Pharma, Wholesaler, GPO & Pharmacy Buyer Pharmacy Buyer GPO Wholesaler Pharmacy Operations Manufacturer

6. Group Purchasing Organization  Contract Compliance  Business Class DEA Status “Not for” or “For” profit status

7. Group Purchasing Organization  Robinson Patman Act Sets rules for discount pricings  Business Class (DEA license status)  Volume Discounts  Formulary restrictions Litmus test = “Own Use”  Patients register to the facility  Employees Profit Status – exemptions for “Not for Profit”  Limited dispensing – inpatient ED and hospital outpatients

8. Wholesale Distributors  Prescription Drug Marketing Act of 1987 Amended in 1992 and 2006 Regulates resale of drugs by hospitals States must license Wholesalers FDA 5% rules annual sales to other pharmacies without Wholesale License  States may have a more stringent regulations Drug Pedigree  Resale to hospital own outpatient pharmacy  Resale to clinics and physician offices

9. Pharmaceutical Sales Representatives  An important role in providing medication information they are guest of the hospital and expected to follow hospital policies  HIPPA, PHRMA Accepted Rules of Conduct and Security  Verify contact information including representative’s district/regional manager  Sign Acknowledgement of understanding hospital rules

10. Pharmaceutical Sales Representatives  Set the expectations for service: Educational programs Information displays  Contact with Physician and Staff Location restrictions Discussion of P&T activities  Penalties for inappropriate activities

11. Pathway to P&T Pharmacy Buyer PreparationAnalysis Drug Shortages Tools

12. Preparation to bring a new drug onto formulary  Manufacturer Contracts/LOP’s/LOC’s Reimbursement/HCPCS codes Storage and Handling Shelf life Patient Assistant Programs Educational plan for Medical and Pharmacy staff  DOP or Clinical RPH Therapeutic Indication Where will item be stocked Suspected Usage Start up Min/Max levels

13. Cost Analysis  Cost Comparison to similar medications currently on formulary  Correct Contract tiers based on market share.  340 pricing if eligible.

14. Shortage Report  New Shortages  Ongoing Shortages  Permanent Outages  Resolved Shortages Reason for Shortage Expected Release Date Product Management Supply information

15. Shortage Report - Sample Pharmacy Bulletin June 2011 National Backorders - Drug Shortages MedicationReason for ShortageExpected Release DateProduct ManagementSupply Information New Shortages Bisacodyl Enema 10mg/30ml none givenTBDbisacodyl suppositories#6 in the pharmacy and #4 in pyxis Ongoing Shortages Acetylcysteine 10% and 20% vials American Regent supply issues Late May for 10ml and larger sizes; 4ml TBD ordered in 10ml and 30ml vials to compound 4ml inhalation as needed 10% - #30 4ml vials; 9 10ml vials; 20 30ml vials; 20% - #12 4ml vials; #0 30ml vials Permanent Outages BaygamDiscontinued Gamastan0 Resolved Shortages Acyclovir Sodium InjectionIntermittent shortages due to increased demand and mfr delays APP has product available for direct ship 10ml -30 vials on hand ;20ml - 30 vials on hand

16. The Buyer is the “Glue” Pharmacy Staff Medical Staff Pharmacy Management Team Patient

17. Pharmacy Staff  Ordering Two way Communication Shortages and Recalls  Shortages Anticipated length Allocation Alternative item  Recalls Anticipated length

18. Pharmacy Staff  Formulary Management Additions/Deletions New CDM’s  Location of Product Location, Location, Location!

19. Medical Staff  Drug Shortages Anticipated Length Alternative Item  Recalls Ancillary Departments Clinics Physician Offices  Newsletters ISMP Pharmacy Newsletter  Formulary Updates

20. Pharmacy Management Team Pharmacy Buyer  Drug Shortages  Recalls  Contract Updates  Vendor Representative Update New products  Pricing  Availability  Reports Budget Pharmacy Management Team  DOP Budget New Services  Clinical New Initiatives  Technician Supervisor Automation Scheduling

21. Patient  Drug Shortages  Recalls  Non-Formulary Items

22. Communication is the Key Pharmacy Purchasing Pearls