§428.201. Calculation of the total rebate amount to be paid by manufacturers. — Inbound Citations

(4) In accordance with paragraph (b)(1) of this section, CMS will grant a reduction in the total rebate amount determined under § 428.201, if any is owed, if a manufacturer submits to CMS a request in writing for an eligible drug, in accordance with the timing set forth in paragraph (c)(2) of this section, demonstrating that:

(i) A severe supply chain disruption has occurred during the applicable period;

(ii) The severe supply chain disruption directly affects the manufacturer itself, a contract manufacturer, a supplier of an ingredient or packaging, or a method of shipping or distribution that the manufacturer uses in a significant capacity to make or distribute the generic Part D rebatable drug or biosimilar; and

(iii) The severe supply chain disruption was caused by a natural disaster or other unique or unexpected event.

(a) As required under section 1860D-14B(b)(1)(C)(iii) of the Act, CMS will reduce the total rebate amount determined under § 428.201, if any is owed, for a generic Part D rebatable drug when CMS determines that the generic Part D rebatable drug is likely to be in shortage, as set forth in § 428.300.

(i) A report with a reconciled rebate amount that is an increase to the rebate amount is the invoice for such additional amount due on the manufacturer's rebate amount as set forth in § 428.201 for a Part D rebatable drug for an applicable period.

In the case of a Part D rebatable drug that is a line extension of a Part D rebatable drug that is an oral solid dosage form, the rebate amount for an applicable period is equal to the amount determined under § 428.201(a)(1)(i) for such new drug or, if greater, the alternative total rebate amount. CMS will determine the alternative total rebate amount for such new formulations according to the following:

(a) As required under section 1860D-14B(b)(1)(C)(i) of the Act, CMS will reduce the total rebate amount determined under § 428.201(a), if any is owed, for a Part D rebatable drug that is currently in shortage, as set forth in § 428.300, at any point during the applicable period.

(a) As required under section 1860D-14B(b)(1)(C)(ii) of the Act, CMS will reduce the total rebate amount determined under § 428.201(a), if any is owed, for a generic Part D rebatable drug or biosimilar when CMS determines there is a severe supply chain disruption during the applicable period such as that caused by a natural disaster or other unique or unexpected event.

(ix) The rebate amount due as set forth in § 428.201(a).

(1) Section 1860D-14B(f) of the Act precludes administrative or judicial review on the determination of units as set forth in § 428.203, the determination of whether a drug is a Part D rebatable drug as set forth in § 428.101, and the calculation of the rebate amount as set forth in § 428.201(a) inclusive of any reconciled rebate amount.

(a) CMS may impose a civil money penalty on a manufacturer that fails to pay the rebate amount set forth in § 428.201(a) on a Part D rebatable drug set forth in § 428.20, by the payment deadline as set forth in section § 428.405(a) for such drug for such applicable period.

In the case of a Part D rebatable drug that is a line extension of a Part D rebatable drug that is an oral solid dosage form, the rebate amount for an applicable period is equal to the amount determined under § 428.201(a)(1)(i) for such new drug or, if greater, the alternative total rebate amount. CMS will determine the alternative total rebate amount for such new formulations according to the following: