Pharmacies

The pharmacy industry is one of the most highly regulated and evolving industries in the United States.

Companies in the pharmacy industry have the arduous task of improving clinical effectiveness and efficiency and responding to new reimbursement models while maintaining compliance with the myriad of ever-changing federal and state laws and regulations affecting their business. Epstein Becker Green has a deep bench of lawyers with the experience necessary to help pharmacy industry clients navigate this complex and challenging environment, stay compliant, and manage and minimize their liability exposure.

Our clients include regional and national pharmacy chains; specialty, compounding, mail-order, and independent pharmacies; hospitals and retailers with pharmacy operations; group purchasing organizations; pharmacy services administrative organizations; and technology vendors supporting pharmacy operations. Our attorneys have extensive experience providing these clients with strategic, transactional, regulatory, and litigation services and support.

Our attorneys’ experience is supplemented by a thorough knowledge of Medicare Advantage and Part D Program requirements, including issues relating to payment policies, compliance plan obligations, reporting requirements, enrollment and disenrollment rules, coordination of benefits, and marketing guidelines. Our attorneys are also frequent lecturers at pharmacy conferences and write on a broad range of pharmacy law-related topics. We stay on top of new developments and inform our clients about emerging issues and trends that may impact their business or the pharmacy industry as a whole.

Our Services

Federal and State Regulatory Compliance

• Providing compliance counseling on federal and state anti-kickback and anti-inducement laws, Medicare Part D, the 340B Drug Pricing Program, and privacy and security matters under the Health Insurance Portability and Accountability Act (HIPAA) and the Health Information Technology for Economic and Clinical Health (HITECH) Act
• Structuring rewards programs (gas rewards, coupons, “buy one, get one free,” and other loyalty programs) under the federal anti-kickback and anti-inducement laws
• Advising on patient co-payment coupons sponsored by manufacturers in response to the recent Office of Inspector General (OIG) study questioning the effectiveness of manufacturing safeguards to prevent fraud and abuse
• Structuring arrangements with drug manufacturers in compliance with fraud and abuse and privacy laws, patient adherence and medication therapy management service programs, data sharing arrangements, co-payment coupons, and limited distribution network and other specialty pharmacy models
• Advising on controlled substances, Drug Enforcement Administration (DEA) registration requirements, electronic-prescribing software and telemedicine issues, auto-dispensing, drug recalls and market withdrawals, and seizures and injunctions
• Representing pharmacy service administrative organizations with respect to contracting, antitrust, and other regulatory compliance issues

Licensure, Registration, and Accreditation

• Advising national and regional pharmacies with mail service and specialty operations on pharmacy benefit manager (PBM) credentialing requirements and the applicability of in-state and out-of-state licensing requirements
• Assisting private equity groups in conducting the health regulatory due diligence of specialty pharmacy and health care technology companies; such due diligence includes assessing compliance with licensing requirements and shepherding all necessary filings, such as federal and state “change of ownership” requirements
• Counseling resident and non-resident pharmacies on change of ownership, transfer matters, and other federal and state approvals

Drug Reimbursement and Pricing

• Advising pharmacies on Medicaid, Medicare Advantage, and Part D Program requirements and the reimbursement landscape in general, including issues relating to payment policies, compliance plan obligations, reporting requirements, enrollment and disenrollment rules, coordination of benefits, and marketing guidelines
• Assessing usual and customary rate issues related to a pharmacy’s drug discount programs (payor and government enforcement agencies routinely target generic discounts, gift cards, and other rewards programs)
• Providing strategic advice to pharmacies regarding the applicability of federal and state “any willing provider” laws to prevent payor lockouts, PBM credentialing requirements, drug manufacturer limited distribution requirements, and other potential obstacles relating to patient and drug product access

Audits, Investigations, and Litigation

• Representing pharmacy industry clients in inspections, investigations, and litigation initiated by governmental agencies, such as the Food and Drug Administration (FDA), DEA, OIG, and Department of Justice; state regulatory and professional licensing agencies; and state Attorneys General, among others; such investigations have related to matters involving brand versus generic billing, customer discount programs, proof of delivery, rebates, and administrative services
• Representing pharmacies and distributors with respect to investigations involving inventory control and reverse distribution issues
• Providing representation to pharmacies, including specialty pharmacies, in a significant number of Board of Pharmacy actions throughout the country
• Representing a variety of clients involved in the drug distribution chain with matters relating to the alleged diversion of drug products, including prohibited diversion under the Controlled Substance Act and 340B drug discount program
• Representing pharmacy clients in government and commercial payor reimbursement audits, proceedings, and appeals
• Providing representation to pharmacies in antitrust litigation involving prescription drug pricing issues, including discriminatory pricing practices

Mergers, Acquisitions, Joint Ventures, Affiliations, and Outsourcing

• Representing private equity sponsors with structuring, implementing, and coordinating the due diligence of various pharmacy-related transactions, including mergers and acquisitions, dispositions, and strategic alliances
• Drafting and negotiating contracts specific to the pharmacy industry, including network agreements; product and data purchase, medication adherence, rebate, and other arrangements with drug manufacturers and “hub” service providers; pharmacy services agreements with hospitals and accountable care organizations; and 340B contract pharmacy services agreements
• Representing pharmacies, specialty pharmacies, and pharmacy vendors in company sales, acquisitions, mergers, and joint ventures