Wednesday, December 19, 2007

Text of the AMP Injunction Order

At long last, we can finally see the Order granting the injunction against CMS’ implementation of the Average Manufacture Price (AMP) Final Rule.

Order in Civil Action No. 1:07cv02017 (I’m pretty confident that this is the final version because it says “Signed by Royce C. Lamberth, United States District Judge, on December 19, 2007.”)

Fans of legal wrangling will enjoy the back and forth between CMS and NACDS/NCPA over the wording of the final version. See these documents on the NCPA site. (The final version above was not on NCPA's site as of 8:30 PM EST on Wednesday night.)

The Order is two pages and contains only a few provisions. Here’s my plain English translation:

CMS can not use AMP Final Rule to compute retail pharmacy reimbursements under Medicaid. Obviously, this was the primary goal of the lawsuit.

CMS can continue to require drug manufacturers to make AMP and best price calculations under the AMP Final Rule. As I speculated on Monday, manufacturers faced the prospect of maintaining dual AMP calculations until the lawsuit got resolved. PhRMA explained this reality to the court in its letter on Tuesday. The Order clears up the uncertainty.

No AMP data can be disclosed on a public web site or to any individuals or states. NACDS and NCPA fought for this provision because of a recent survey indicating that nine states were considering AMP as the basis for brand reimbursement. (See page 5 of 2007 State Perspectives Medicaid Pharmacy Policies and Practices.)

Well, I hope this post satisfies the AMP fanatics. Now I've got to go back to packing for my vacation!


  1. Adam-
    You have definitely posted the correct/final version of the Order. This Order appeared on the official federal court docket yesterday. Thanks for the link; it's always nice to see the actual legal document.


  2. Dr.Fein,
    As I am a pharmacist with limited legal knowledge, how strong is this injunction, and will it be permanent?
    Having read it, and all the briefs with it, it seems to me that cms clearly went beyond "retail class of trade", "wholesaler", and intent of congress. Why do states not pay reasonable dispensing fees? My state pays wac, (with no additional %), and a $3.40 dispensing fee. Now they are implementing copays, which the patient can say they cannot afford. Pharmacies cannot refuse to fill the script, so in some cases we would lose money. Generic prescriptions are the only profitable way we can stay in the Medicaid business.

  3. Matt,

    Wherever you practice, you and your peers need to look what happen in Texas a few years back and draw on that for your solution.

  4. Tex:

    Please give us your take on the Texas situation.


  5. Dr. Adam,

    I just thought I'd say congratulations on maintaining a very insightful blog.

    Keep up the great work!