There are many metrics that can be used to evaluate an entity’s 340B program performance. Some are targeted at measuring compliance efforts, such as number of prescriptions audited per quarter, while others look at financial optimization.
One of the most common metrics used to gauge financial performance is to look at ratios of drug purchases across an entity’s WAC, GPO, and 340B/PHS accounts. To a casual observer, it may seem logical that in order for a program to maximize savings they should purchase as many items as possible on their 340B and/or GPO account(s) while limiting the amount they purchase on their WAC accounts. However, simply looking at which account a purchase is made on can be misleading, and in some cases guide decisions that are detrimental to your program.
For example, Apexus (the Prime Vendor) has negotiated discounted pricing for many items and those prices are allowed to be loaded into an entity’s WAC account. Often these items will carry the same price, or even lower, across purchasing accounts, especially when compared to the item cost in a GPO account.
Entities who are able to scrutinize costs across accounts may find themselves actually making increased purchases of items on their WAC account in order to take full financial advantage of the Apexus-negotiated pricing. From a high-level view, it may seem like there is an increase in WAC spend, but the result is actually a lower overall drug spend.
Entities can get a better picture of true, sub-optimal purchases by ensuring they adjust for specific contracts (like Apexus’) rather than just looking at general accounts. Additionally, entities can work with wholesalers to track when a purchase on a WAC account is made for an item when a lower price does not exist. In these cases, purchases should not factor into a 340B performance metric as there is no true missed opportunity.
Being aware of these nuances and their potential to skew a common 340B performance metric will hopefully guide your entity to make more accurate assessments.
So next time you are at a conference and hear a vendor say they can decrease your program’s WAC spend, don’t be misled. Instead, ask them how they can help optimize your purchases so that you purchase items at the best possible price – regardless of account.