DRAFT_RFP_Section_X_Composite_-_Guarantee_(Oct_4 _2012).docx

TPharm4 Draft Statement of Work

C.7.11 Pharmaceutical Agents and Supplies [Revised]

The contractor shall provide the initial inventory of pharmaceutical agents and supplies, hereafter referred to collectively as “agents,” for the TRICARE Mail Order Pharmacy (TMOP) for dispensing to TRICARE beneficiaries. The government shall replenish that inventory as set forth below.

In order for the Government to replenish agents dispensed to TRICARE beneficiaries, the contractor shall(1) request replenishment in kind of the same agents as dispensed for brand pharmaceutical agents; (2) request replenishment in kind of the same agents as dispensed or request replenishment by the therapeutically equivalent pharmaceutical agent for generic medications. . The contractor shall request replenishment for agents dispensed to TRICARE beneficiaries by using the Managed Care Pricing File (MCPF) to obtain agents from the government’s contracted National Prime Vendor (NPV). In order to optimize replenishment, the contractor will provide written notification to the KO and COR when NPV is not able to resolve any situations which may impede the replenishment process.

The Government compiles the MCPF from Federal Supply Schedules (FSS), Distribution and Pricing Agreements (DAPA), joint Department of Defense/Department of Veterans Affairs (DoD/DVA) national contracts, DoD contracts, and Blanket Purchase Agreements (BPA). This is currently compiled by the Defense Logistics Agency Troop Support (DLA).

The contractor shall use the MCPF to identify, select, and price orders from the NPV for agents in package sizes that are most economical to the Government and can support TMOP utilization levels. If the contractor is using the NPV’s online ordering system, the contactor is required to select the most economical contracted agent available in the online ordering system.

Orders shall be rounded down to the nearest whole package size of product needed to replenish agents dispensed through TMOP.

The agents will be shipped by the NPV to the contractor’s TMOP locations.

The contractor shall provide volume utilization data to the NPV for prescriptions dispensed by TMOP, to be used in determining the quantity stocked by the NPV. This data shall be provided in a format mutually agreed upon by the contractor, COR, and DLA.

At least twice a year, the contractor shall participate in a process to expend any credits that have accumulated with the NPV as a result of returns, pricing errors, and other adjustments. This date and exact process for using the credit shall be mutually agreed-upon by DLA, the NPV, the COR and the contractor. In the event of an unusually large credit, the Government may initiate an out-of-cycle request to perform the process.

The contractor shall accommodate all special requirements in regards to handling, processing or shipping medications as recommended by the Food and Drug Administration (FDA) or manufacturer for products dispensed through TMOP.

DRAFT 03 October 2012 Page 1

New Requirement:

C.7.11.1. Guaranteed Fulfillment and Absorption of Unreplenishable Pharmaceutical Agents and Supplies

As provided herein, the contractor shall primarily dispense agents which are replenishable by the NPV. The contractor understands that dispensed agents unreplenished from the NPV, as well as agents that become excess to the contract upon completion, are solely the responsibility of the contractor.

The contractor guarantees fulfillment of TMOP prescriptions within contract time standards using compliant agents obtained by the contractor’s sources, to the extent such agents exist in the market at the time of fulfillment. In those instances where TMOP demand hereunder cannot be met by dispensing agents replenishable by the NPV, the contractor shall not return the prescription unless the medication is unavailable from commercial sources.

C.7.12 Rebaseline and Continuous Monitoring [Revised]

Prior to the beginning of the first option period, by a date mutually agreed upon during the post award meeting, and during each successive exercised option period within 60 days of Contracting Officer notification, the contractor will submit a baseline listing of multi-source generic or branded products by 11-digit National Drug Code (NDC) for Contracting Officer approval.

Each baseline listing will identify the therapeutically equivalent NDC that is the most economical to the Government.

Following the start of Option Period 1, the contractor shall continuously monitor on a weekly basis product availability and pricing of all products to provide recommendations to the Government for the most cost-effective agents to be dispensed through TMOP. The contractor shall identify the recommended change by 11-digit NDC for Government approval and the anticipated annual savings to the Government based on current utilization trends.

The contractor will provide a quarterly status report of the continuous monitoring effort.

The Contracting Officer may direct the contractor to make additional changes due to: 1) significant changes in drug prices, 2) the Government’s award of a pharmaceutical procurement contract, or 3) other circumstances that necessitate a change.

Authorization for switches must be obtained from the Contracting Officer or Contracting Officer’s Representative (COR) in writing.

The contractor shall complete each NDC change no later than thirty calendar days after being notified by the Government. The contractor shall attempt to deplete all current inventory received from the prime vendor prior to implementing the NDC change. In situations where the prime vendor has supplies of government specific inventory, the contractor shall work with the prime vendor to deplete supplies prior to implementing the NDC change. The contractor shall notify the government if it anticipates it will be unable to deplete this inventory.

The contractor shall submit a written request for extension to the COR within ten days of receiving initial notification if the NDC change is expected to take longer than thirty calendar days.

The request shall state the date the NDC change will be made and include the rationale for the extension.

The contractor shall track and report volume of dispensed agents and replenishment agents ordered and received from the NPV, and provide auditable reconciliation reporting by 11-digit NDC number. The elements required for auditing will be specified by the Government. In cases where therapeutic equivalent agents are used to replenish dispensed agents, the contractor will maintain records which permit the therapeutic equivalent agents to be tracked by quantity and cost back to the original agents in the contractor’s inventory. (See C.7.11). In the event that a dispensed NDC is not available for replenishment, the contractor will request replenishment with a therapeutically equivalent substitute product with the same drug, dose, and dosage form. The contractor shall use the NPV as the primary source for pharmaceutical agents and supplies.

The contractor shall not deviate from the procedures described above when ordering products from the NPV without prior written authorization from the Contracting Officer or COR. Requests to do so shall include the 11-digit NDC number, nomenclature of the product(s), package size, anticipated purchase quantity, unit cost per package, and anticipated total cost of the order for both the requested product and the product it will replace.

The contractor will provide written notification to the Government within a 14 days if availability issues result in prescriptions being returned to the beneficiary.

In limited cases, the contractor may be required to order certain agents and supplies through the NPV to be drop shipped directly from the manufacturer to the TPharm contractor.

The quantities ordered shall not exceed the amount to be dispensed.

The Contractor shall coordinate with the DoD National Prime Vendor (NPV) and the Defense Supply Center as necessary in order to accomplish the replenishment of MOP pharmaceutical agents. The operational processes for this coordination are between the Contractor and the NPV, but shall not be inconsistent with NPV requirements established in solicitation SPM2DX-11-R-0001, the resulting contract, or successor contracts.

The contractor, by performing a quantity receipt acknowledgement process consistent with the requirements in the NPV solicitation, will not be responsible for the cost of the product received from the Government (currently handled by DLA) to the extent that receipts represent replenishment of authorized quantities dispensed at TMOP.

[New Requirements – Impact of Guarantee on Other Sections of the Contract]

G______ CLINs X01X. The Contractor may submit a commercial invoice immediately upon option exercise for the annual guarantee premium.

L______. CLINs X01X. Offerors shall propose an annual premium for the risk assumed to ensure the continuity of MOP dispensing in instances demand is not met by the NPV in order for the offeror to meet MOP dispensing standards and to disposition any pharmaceutical agent or supply inventory which may become excess to the contract upon completion. Historical data is available to offerors at xxx. The Government does not warrant the historical data reflects future frequency, volume, utilization, or costs. Offerors shall identify key assumptions.

M ______. CLINs X01X will be included in the Total Evaluated Price.