(a) A drug company that has a valid rebate agreement under 42 U.S.C. §1396r-8 may apply to HHSC to add a drug to the Texas Drug Code Index (TDCI). The term "drug company" includes any manufacturer, repackager, or private labeler.(b) To apply for the addition of a drug to the TDCI, a drug company must complete each section of the Certificate of Information for the Addition of a Drug Product to the TDCI provided by HHSC.(c) A drug company must also:(1) update HHSC with changes to formulation, product status, or availability; and(2) submit changes to the prices requested in the Price Certification section of the Certificate of Information, if requested by HHSC, within 10 calendar days of receiving the request.(d) When a drug company manufactures a brand-name insulin prescription drug for which a generic or biosimilar prescription drug is not available, but the generic or biosimilar prescription drug is in the VDP formulary, the manufacturer must submit to HHSC a written verification stating whether or not the unavailability of the generic or biosimilar prescription drug is the result, wholly or partly, of:(1) a scheme by the manufacturer to pay a generic or biosimilar prescription drug manufacturer to delay manufacturing or marketing the generic or biosimilar drug;(2) a legal or business strategy to extend the life of a patent on the brand name prescription drug;(3) the manufacturer directly manipulating a patent on the brand name prescription drug; or(4) the manufacturer facilitating an action described by paragraphs (1) - (3) of this subsection on behalf of another entity.(e) The written verification as described in subsection (d) of this section must be provided by the manufacturer to HHSC:(1) by submitting a Certificate of Information; and(2) on a yearly basis thereafter through the supplemental rebate solicitation process.(f) Sources other than drug companies may request the addition of a drug not currently listed in the TDCI. If the request is not from a drug company, HHSC may request that the manufacturer submit a Certificate of Information as described in subsection (b) of this section.(g) HHSC adds drugs to the TDCI on a provisional basis after HHSC receives a Certificate of Information that is then approved by HHSC, or is pending review by HHSC for a determination by HHSC that the drug is appropriate for dispensing through an outpatient pharmacy and meets the additional requirements in Texas Government Code §531.0691.(h) The drug company and other sources, if applicable, are entitled to receive notification of approved or denied Certificate of Information. If a Certificate of Information is denied, HHSC will state the reasons for the denial.(i) Notwithstanding any other state law, pricing information reported by a drug company under this subchapter is confidential and must not be disclosed by HHSC, its agents, contractors, or any other State agency in a format that discloses the identity of a specific manufacturer or labeler, or the prices charged by a specific manufacturer or labeler for a specific drug, except as necessary to permit the Attorney General to enforce state and federal law.(j) Definitions. The following words and terms, when used in this chapter and in Chapter 355 of this title (relating to Reimbursement Rates), have the following meanings unless the context clearly indicates otherwise.(1) Acquisition Cost (AC)--HHSC's determination of the price pharmacy providers pay to acquire drug products marketed or sold by specific manufacturers. AC is based on NADAC, wholesale acquisition cost (WAC), or pharmacy invoice, in accordance with the Medicaid state plan.(2) Average Manufacturer Price (AMP)--The average manufacturer price as defined in 42 USC §1396r-8(k)(1).(3) Average Wholesale Price (AWP)--The average wholesale price for a drug as published in a price reporting compendium such as First DataBank or Medispan.(4) Customary Prompt Pay Discount--Any discount off the purchase price of a drug routinely offered by the drug company to a wholesaler or distributor for prompt payment of purchased drugs within a specified time frame and consistent with customary business practices for payment.(5) Direct Price to Long Term Care Pharmacy--The amount paid by a pharmacy servicing a long term care facility, including a nursing facility, assisted living facility, and skilled nursing facility. The price should be net of price concessions. In reporting this price point to HHSC, if the price is reported as a range, the weighted average of these prices, based on unit sales, must be included. The following prices should be excluded from this price point:(A) prices excluded from the determination of Medicaid Best Price at 42 C.F.R. §447.505; and(B) prices to entities participating in the Health Resources and Services Administration (HRSA) 340b discount program.(6) Direct Price to Pharmacy--The amount paid for a product by a pharmacy when purchased directly from a drug company. This price should be net of Price Concessions. In reporting this price point to HHSC, if the price is reported as a range, the weighted average of these prices, based on unit sales, must be included. The following prices should be excluded from this price point:(A) prices excluded from the determination of Medicaid Best Price at 42 C.F.R. §447.505;(B) prices to entities participating in the Health Resources and Services Administration (HRSA) 340b discount program; and(C) Direct Prices to Long Term Care Pharmacy.(7) Gross Amount Due--Has the meaning as defined by the National Council for Prescription Drug Programs.(8) Long term care facility--Facility that provides long term care services, such as a nursing home, skilled nursing facility, assisted living facility, group home, hospice facility, or intermediate care facility for individuals with an intellectual disability or related condition (ICF/IID).(9) Long term care pharmacy--A pharmacy for which the total Medicaid claims for prescription drugs to residents of long term care facilities exceeds 50 percent of the pharmacy's total Medicaid claims per year. Long term care pharmacies are not open to the public for walk-in business.(10) Long term care pharmacy acquisition cost (LTCPAC)--The acquisition cost determined by HHSC for a drug product purchased by a long term care pharmacy.(11) "May apply to HHSC"--The act of applying to have a drug included on the TDCI. This includes completing the Certificate of Information for the Addition of a New Drug Product to the Texas Drug Code Index, submitting National Drug Code (NDC) changes, submitting price updates, and submitting additional package sizes for a drug that is already included on the TDCI.(12) NADAC--National Average Drug Acquisition Cost.(13) National Drug Code (NDC)--The 11-digit numerical code established by the U.S. Food and Drug Administration that indicates the labeler, product, and package size.(14) Pharmacy--An entity with an approved community pharmacy license or an institutional pharmacy license.(15) Price concession--An action by a manufacturer (other than a customary prompt-pay discount as defined in this section) that has the effect of reducing the net cost of a product to a purchaser. The term includes discounts, rebates, billbacks, chargebacks, or other adjustments to pricing or payment terms. Lagged price concessions must be accounted for in the Reported Manufacturer Pricing by operation of a 12-month average estimation methodology as described in 42 C.F.R. §414.804. For new, at launch products, if a manufacturer has forecasted price concessions, the initial Reported Manufacturer Pricing should reflect this internal business information.(16) Price to Wholesaler/Distributor--The amount paid by a wholesaler or a distributor. The price should be net of price concessions. In reporting this price point to HHSC, if the price is reported as a range, the weighted average of these prices, based on unit sales, must be included. The following prices should be excluded from this price point:(A) prices excluded from the determination of Medicaid Best Price at 42 C.F.R. §447.505; and(B) prices to entities participating in the Health Resources and Services Administration (HRSA) 340b discount program.(17) Reliable Sources--Sources including other state or federal agencies and pricing services, as well as verifiable reports by contracted providers and Vendor Drug Program formulary and field staff.(18) Reported Manufacturer Pricing--Pricing information submitted to HHSC by a drug company on a Certificate of Information, or in subsequent price updates as described in subsections (b) and (c) of this section. This pricing information includes: AWP, AMP, Price to Wholesaler/Distributor, Direct Price to Pharmacy, and Direct Price to Long Term Care Pharmacy. If a drug company does not have a single price for a price point, it must report a range of prices. If a drug company reports a range of prices, it must also provide the weighted average of these prices based on unit sales.(19) Retail Pharmacy Acquisition Cost (RetailPAC)--HHSC's determination of the price a retail pharmacy pays to acquire drug products marketed or sold by specific manufacturers.(20) Specialty pharmacy--A pharmacy that meets all of the following criteria:(A) total Medicaid claims for specialty drugs, as described in §354.1853 of this subchapter (relating to Specialty Drugs), exceeds 10 percent of the pharmacy's total Medicaid claims per year;(B) obtains volume-based discounts or rebates on specialty drugs from manufacturers or wholesalers; and(C) delivers at least 80 percent of dispensed prescriptions by shipment through the U.S. Postal Service or other common carrier to customers or healthcare professionals (including physicians and home health providers).(21) Specialty pharmacy acquisition cost (SPAC)--HHSC's determination of the price a retail pharmacy pays to acquire drug products marketed or sold by specific manufacturers.(22) Weighted AMP (Average Manufacturer Price)--The Weighted AMP (Average Manufacturer Price) as contemplated in 42 U.S.C. §1396r-8(b)(3) and (e), and as reported by the Centers for Medicare & Medicaid Services.(23) Wholesaler Cost--The net cost of a product to a wholesaler; equivalent to Price to Wholesaler/Distributor and cost to wholesaler.