How NADAC Provides Accuracy, Transparency to the Drug Supply Chain | NCPA 2024
AJ Loiacono, co-founder and CEO of Capital RX, discusses how the National Average Drug Acquisition Cost provides accuracy and transparency for stakeholders across the drug supply chain.
The National Average Drug Acquisition Cost (NADAC) is a benchmark that provides drug prices to the pharmaceutical supply chain. The prices, which are determined by averaging prices from retail community pharmacies across the United States, are gathered from the monthly Retail Price Survey conducted by the Centers for Medicare and Medicaid Services (CMS).1
Traditionally, the wholesale acquisition cost (WAC) was used to determine prices through cost-effectiveness analyses. However, drug prices from the WAC did not reflect the actual cost paid for drugs due to different discounts and rebates granted to entities throughout the drug supply chain.2 The NADAC aims to provide more accurate drug prices for states who use it as a reference price when setting their reimbursement methodology.
At the National Community Pharmacists Association (NCPA) 2024 Annual Convention and Expo, held October 26 to 29 in Columbus, Ohio, Drug Topics sat down with AJ Loiacono, co-founder and CEO of Capital RX, to discuss how the NADAC survey is conducted, how it captures drug pricing data across various pharmacies, what makes it a reliable source of pricing information, and what advantages it offers in terms of accuracy and transparency for stakeholders across the drug supply chain.
“There really hasn’t been, until NADAC emerged, a way for people to understand what the appropriate or real cost of a drug is,” Loiacono said. “This kind of sets the stage for the entire supply chain, what I call the distribution and payer side. Distribution being the pharmacies and payers being insurance and self-insured plan sponsors. Without a reasonable benchmark of pricing, unfortunately, people tend to take advantage of peoplewhen they don’t know a price.”
Click here to follow along with our NCPA conference coverage.
