DEPARTMENTOFHEALTH &. HUMAN SERVICES Officeof InspectorGeneral
Washington, D.C. 20201
AUG 12 2008
TO: Kerry Weems
Acting Administrator
Centers forMedicare & Medicaid Services
FROM: Daniel R. Levinson
InspectorGeneral
SUBJECT: Memorandum Report: "ComparisonofFourth-Quarter2007 Average Sales
Prices and Average ManufacturerPrices: Impact onMedicare
Reimbursement for Second Quarter2008," OEI-03-08-00340
Thiscongressionally mandated reviewcompares average salesprices (ASP) to average
manufacturerprices (AMP) for Medicare Part Bprescription drugs and identifies drugs with
ASPs that exceededAMPs by at least 5percent during the fourth quarter of2007. Italso
determines the impact oflowering reimbursementamounts for drugs thatmeetthe 5-percent
threshold.
This is the Office ofInspector General's (DIG) seventhreport comparingASPs to AMPs.
However, it is DIG's first pricing comparison since the Centers for Medicare & Medicaid
Services (CMS) implemented a revised ASP paymentmethodology recently mandated by
statute. In December2007, the Medicare, Medicaid, and SCHIP Extension Act of2007,
P.L. No. 110-173, amended section 1847A(b)ofthe Social SecurityAct (the Act) and
changed the way in which CMS calculatesvolume-weighted ASPs, effectiveApril 1, 2008.
UsingCMS's revised ASP paymentamount methodology, we identified 12 of285 drug
codes withASPs that exceededAMPs by at least 5 percent in the fourth quarterof2007. If
reimbursement amounts for all 12 codes had beenbased on 103 percentofthe AMPs, we
estimate that Medicare expenditures would have beenreduced by $20 million during the
second quarterof2008 alone.
BACKGROUND
Section I847A(d)(2)(B) ofthe Act mandates that DIG compareASPs to AMPs. IfGIG finds
that the ASP for adrugexceeds the AMP by a certainpercentage (currently 5percent),
section 1847A(d)(3)(A) ofthe Actstates that the Secretaryofthe DepartmentofHealthand
Human Services (the Secretary)may disregard the ASP for the drug when setting
reimbursement amounts. Section 1847A(d)(3)(C) ofthe Act goes onto statethat "... the
Inspector General shall inform the Secretary(at such times as the Secretary may specify to
carry out this subparagraph) and the Secretaryshall, effective as ofthe nextquarter,
OEI-03-08-00340 ComparisonofFourth-Quarter2007 ASPsandAMPs Page 2  Kerry Weems 
 
 
substitute for the amount of payment . . . the lesser of (i) the widely available market                 
price . . . (if any); or (ii) 103 percent of the average manufacturer price . . . .   
 
Medicare Part B Coverage of Prescription Drugs 
Medicare Part B covers only a limited number of outpatient prescription drugs.  Covered 
drugs include injectable drugs administered by a physician; certain self-administered drugs, 
such as oral anticancer drugs and immunosuppressive drugs; drugs used in conjunction with 
durable medical equipment; and some vaccines.  
 
Medicare Part B Payments for Prescription Drugs 
CMS contracts with private companies, known as carriers, to process and pay Medicare                 
Part B claims, including those for prescription drugs.  To obtain reimbursement for covered 
outpatient prescription drugs, physicians and suppliers submit claims to their carriers using 
procedure codes. CMS established the Healthcare Common Procedure Coding System 
(HCPCS) to provide a standardized coding system for describing the specific items and 
services provided in the delivery of health care.  In the case of prescription drugs, each 
HCPCS code defines the drug name and dosage size but does not specify manufacturer or 
package size information.   
 
Medicare and its beneficiaries spent about $11 billion for Part B drugs in 2007.  Although 
Medicare paid for more than 675 outpatient prescription drug HCPCS codes that year, the 
majority of spending for Part B drugs was concentrated on a relatively small subset of those 
codes. In 2007, 55 codes accounted for 90 percent of the expenditures for Part B drugs, with 
only 12 of these drugs representing half of the total Part B drug expenditures. 
 
Reimbursement Methodology for Part B Drugs and Biologicals  
Since January 2005, Medicare Part B has been paying for most covered drugs using a 
reimbursement methodology based on ASPs.1  Section 1847A(c) of the Act, as added by the 
Medicare Prescription Drug, Improvement, and Modernization Act of 2003,                                       
P.L. No. 108-173, defines an ASP as a manufacturers sales of a drug to all purchasers in the 
United States in a calendar quarter divided by the total number of units of the drug sold by 
the manufacturer in that same quarter.  The ASP is net of any price concessions, such as 
volume discounts, prompt pay discounts, cash discounts, free goods contingent on purchase 
requirements, chargebacks, and rebates other than those obtained through the Medicaid drug  
                                                 
1 In  2004, the reimbursement amount for most covered drugs was based on 85  percent  of the average wholesale 
price as published in  national pricing compendia, such as the Red Book.  Prior to 2004, Medicare Part B 
reimbursed for covered  drugs based  on the lower of either the billed amount or 95  percent of the average 
wholesale price. 
OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
  Page 3  Kerry Weems 
 
 
rebate program.2  Sales that are nominal in amount are exempted from the ASP calculation, 
as are sales excluded from the determination of best price in the Medicaid drug rebate 
program.3 4  
 
Manufacturers report ASPs by national drug codes (NDC), which are 11-digit identifiers that 
indicate the manufacturer, product dosage form, and package size of the drug.  Manufacturers 
must provide CMS with the ASP and volume of sales for each NDC on a quarterly basis, 
with submissions due 30 days after the close of each quarter.5  
 
Because Medicare Part B reimbursement for outpatient drugs is based on HCPCS codes 
rather than NDCs, and more than one NDC may meet the definition of a particular HCPCS 
code, CMS has developed a file that crosswalks manufacturers NDCs to HCPCS codes.  
CMS uses information in this crosswalk to calculate volume-weighted ASPs for covered 
HCPCS codes. 
 
Calculation of Volume-Weighted Average Sales Prices 
To calculate volume-weighted ASPs, CMS uses an equation that involves the following 
variables: the ASP for the 11-digit NDC as reported by the manufacturer, the volume of 
sales for the NDC as reported by the manufacturer, and the number of billing units in the 
NDC as determined by CMS.  The amount of the drug contained in an NDC may differ from  
the amount of the drug specified by the HCPCS code that providers use to bill Medicare.  
Therefore, the number of billing units in an NDC describes the number of HCPCS code units 
that are in that NDC.  For instance, an NDC may contain a total of 10 milliliters of Drug A, 
but the corresponding HCPCS code may be defined as only 5 milliliters of Drug A.  In this 
case, there are two billing units in the NDC.  CMS calculates the number of billing units in 
each NDC when developing its crosswalk files.   
 
Prior to April 2008, CMS calculated volume-weighted ASPs using the equation presented in 
Appendix A. However, section 112(a) of the Medicare, Medicaid, and SCHIP Extension Act 
of 2007, P.L. No. 110-173, changed section 1847A(b)(6) of the Act to require that CMS 
compute volume-weighted ASPs using a revised methodology, effective April 2008.  This 
revised methodology was initially proposed by OIG in a February 2006 report entitled 
Calculation of Volume-Weighted Average Sales Price for Medicare Part B Prescription 
Drugs (OEI-03-05-00310). The revised equation for calculating volume-weighted ASPs is 
also provided in Appendix A. 
 
Second-quarter 2008 Medicare allowances for most covered drug codes were based on 
fourth-quarter 2007 ASP submissions from manufacturers, which were volume-weighted 
using the revised methodology.  Under the ASP pricing methodology, the Medicare 
                                                 
2 Section 1847A(c)(3) of the Act.  

3 Pursuant to section 1927(c)(1)(C)(i)  of the Act,  best price is the lowest price available from the 

manufacturer  during the rebate period to any wholesaler, retailer, provider, health maintenance organization, 

nonprofit entity, or governmental entity within the United States, with certain exceptions. 

4 Section 1847A(c)(2) of the Act.  

5 Section 1927(b)(3)  of the Act.  

OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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allowance for most Part B drugs is equal to 106 percent of the volume-weighted ASP for the 
HCPCS code. Medicare beneficiaries are responsible for 20 percent of this amount in the 
form of coinsurance.   
 
The Medicaid Drug Rebate Program and Average Manufacturer Prices 
For Federal payment to be available for covered outpatient drugs provided under Medicaid, 
sections 1927(a)(1) and (b)(1) of the Act mandate that drug manufacturers enter into rebate 
agreements with the Secretary and pay quarterly rebates to State Medicaid agencies.  Under 
these rebate agreements and pursuant to section 1927(b)(3) of the Act, manufacturers must 
provide CMS with the AMP for each of their NDCs on a quarterly basis, with submissions 
due 30 days after the close of each quarter.6     
 
As generally defined in section 1927(k)(1) of the Act, the AMP is the average price paid to 
the manufacturer for the drug in the United States by wholesalers for drugs distributed to the 
retail pharmacy class of trade.  Prior to the passage of the Deficit Reduction Act of 2005 
(DRA), P.L. No. 109-171, manufacturers were required to deduct customary prompt pay 
discounts when calculating AMPs.  However, section 6001(c)(1) of the DRA amended 
section 1927(k)(1) of the Act such that AMPs must be determined without regard to 
customary prompt pay discounts, effective January 2007.  In December 2006, CMS 
instructed manufacturers to exclude customary prompt pay discounts from their AMP 
calculations as of January 2007.7  In July 2007, CMS published a final rule 
(72 Fed. Reg. 39142) (July 17, 2007), which, among other things, implements section 
6001(c)(1) of the DRA and clarifies the way in which the AMP must be calculated.  
Specifically, 42 CFR  447.504 of the final regulation clarifies the manner in which the AMP 
is to be determined.8  
 
The AMP is generally calculated as a weighted average of prices for all of a manufacturers 
package sizes of a drug sold during a given quarter and is reported for the lowest identifiable 
quantity of the drug (e.g., 1 milligram, 1 milliliter, 1 tablet, 1 capsule).   
 
Office of Inspector Generals Monitoring of Average Sales Prices and Average 
Manufacturer Prices 
Since the ASP reimbursement methodology for Part B prescription drugs was implemented 
in January 2005, OIG has completed six reports comparing ASPs to AMPs.  A list of these 
reports is provided in Appendix B.  
 
Although CMS has acknowledged the Secretarys authority to adjust ASP payment limits 
based on the findings of these studies, the agency has yet to make any changes to Part B drug 
                                                 
6 Section 6001(b)(1)(A) of the DRA changed section 1927(b) of the Act to require that manufacturers also 
 
report AMPs on a monthly basis, effective January 2007.  Drug manufacturers will continue to report quarterly 

AMP data in addition to their monthly submissions.  

7 Medicaid  Drug Rebate Program Bulletin for Participating  Drug Manufacturers, Release No. 76,   
                       
December 15, 2006. 

8 In December 2007, the United States District Court for the District of Columbia preliminarily enjoined the 

implementation of  the regulation for certain purposes  not relevant  to  this report. 

OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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reimbursement as a result of OIGs pricing comparisons.  In commenting on one of OIGs 
reports, CMS expressed a desire to better understand fluctuating differences between ASPs 
and AMPs, with the intent of developing a process to adjust payment amounts based on the 
results of OIGs pricing comparisons.9  However, CMS has not specified what, if any, steps it 
will take to adjust Medicare reimbursement amounts for drugs that meet the 5-percent 
threshold specified in section 1847A(d)(3) of the Act. 
 
METHODOLOGY 
 
We obtained from CMS NDC-level ASP data from the fourth quarter of 2007, which were 
used to establish Part B drug reimbursement amounts for the second quarter of 2008.  In 
addition, we obtained the file that CMS used to crosswalk NDCs to their corresponding 
HCPCS codes. Both the ASP data and the crosswalk file were current as of March 7, 2008.  
We also obtained AMP data from CMS for the fourth quarter of 2007, which were current as 
of February 6, 2008. 
 
Analysis of Average Sales Price Data From the Fourth Quarter of 2007 
As mentioned previously, Medicare does not base reimbursement for covered drugs on 
NDCs; instead, it uses HCPCS codes.  Therefore, CMS uses ASP information submitted by 
manufacturers for each NDC to calculate a volume-weighted ASP for each covered HCPCS 
code. When calculating these volume-weighted ASPs, CMS includes only NDCs with ASP 
submissions that are deemed valid.  We did not examine NDCs that CMS opted to exclude 
from its calculation, nor did we verify  the accuracy of CMSs crosswalk files. 
 
As of March 2008, CMS had established prices for 525 HCPCS codes based on the revised 
ASP reimbursement methodology mandated by section 112(a) of the Medicare, Medicaid, 
and SCHIP Extension Act of 2007.10  Reimbursement amounts for the 525 HCPCS codes 
were based on ASP data for 3,378 NDCs. 
 
Analysis of Average Manufacturer Price Data From the Fourth Quarter of 2007 
An AMP is reported for the lowest identifiable quantity of the drug contained in the NDC 
(e.g., 1 milligram, 1 milliliter, 1 tablet, 1 capsule).  In contrast, an ASP is reported for the 
entire amount of the drug contained in the NDC (e.g., for 50 milliliters, for 100 tablets).  To 
ensure that the AMP would be comparable to the ASP, it was necessary to convert the AMP 
for each NDC so that it represented the total amount of the drug contained in that NDC.  
 
In making these conversions, we examined AMPs only for those 3,378 NDCs that CMS used 
in its calculation of volume-weighted ASPs for the 525 codes.  If AMP data were not 
available for one or more of these NDCs, we excluded the corresponding HCPCS code from  
our analysis.  We excluded a total of 237 HCPCS codes using this conservative approach.  
                                                 
9 OEI-03-07-00140, July 2007. 

10 Several Part B drugs, including certain vaccines and blood products, are not paid  under the ASP 
 
methodology.
   
OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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The remaining 288 HCPCS codes had AMP data for every NDC that CMS used in its 
calculation of volume-weighted ASPs.  These 288 HCPCS codes represented 1,127 NDCs.  
 
We then multiplied the AMPs for these 1,127 NDCs by the total amount of the drug 
contained in each NDC, as identified by sources such as the CMS crosswalk file, 
manufacturer Web sites, the Red Book, and the Food and Drug Administrations NDC 
directory. We will refer to the resulting amounts as converted AMPs.  For four NDCs, we 
could not successfully identify the amount of the drug reflected by the ASP and therefore 
could not calculate a converted AMP.  These four NDCs were crosswalked to three HCPCS 
codes. We did not include these three HCPCS codes (24 NDCs) in our final analysis.   
 
Using the converted AMPs for the remaining 1,103 NDCs, we then calculated a                      
volume-weighted AMP for each of the codes, consistent with the revised methodology for 
calculating volume-weighted ASPs.  We calculated volume-weighted AMPs for a total of 
285 HCPCS codes.  We did not verify the accuracy of manufacturer-reported ASP and AMP 
data.   
 
Comparing Volume-Weighted ASPs to Volume-Weighted AMPs for the Fourth 
Quarter of 2007 Using the Revised ASP Payment Methodology 
For each of the 285 HCPCS codes included in our study, we compared the volume-weighted 
ASPs and AMPs and identified codes with an ASP that exceeded the AMP by at least                      
5 percent. 
 
For those HCPCS codes that met or exceeded the 5-percent threshold, we reviewed the 
associated NDCs to verify the accuracy of the billing unit information.  According to our 
review, NDCs for two codes had billing unit information in CMSs crosswalk file that may 
not have accurately reflected the number of billing units actually contained in the NDCs.  
Because volume-weighted ASPs and AMPs are calculated using this billing unit information, 
we could not be certain that the results for the two codes were correct.  Therefore, we did not 
include these codes in our findings. 
 
For the remaining HCPCS codes, we then estimated the monetary impact of lowering 
reimbursement to 103 percent of the AMP.11  For each of the HCPCS codes that met the              
5-percent threshold, we calculated 103 percent of the volume-weighted AMP and subtracted 
this amount from the second-quarter 2008 reimbursement amount for the HCPCS code, 
which is equal to 106 percent of the volume-weighted ASP.  To estimate the financial effect 
for the second quarter of 2008, we then multiplied the difference by one-fourth of the number 
of services that were allowed by Medicare for each HCPCS code in 2007, as reported in 
                                                 
11 Pursuant  to  section 1847A(d)(3) of  the Act, if  the ASP for a drug exceeds the AMP by at least 5 percent, the 
Secretary has the authority to disregard the ASP for that drug and replace the payment amount for the drug code  
with the lesser of the widely available market price for the drug (if any) or 103 percent of the AMP.  For the 
purposes of this study,  we used  103 percent  of the AMP to  estimate the impact of lowering  reimbursement  
amounts.   If widely available market prices had been available for these drugs and lower than 103  percent of the 
AMP, the savings estimate presented in this report would have been greater.  
OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
  Page 7  Kerry Weems 
 
 
CMSs Part B Extract and Summary System (BESS).12  This estimate assumes that the 
number of services that were allowed by Medicare in 2007 remained consistent from one 
quarter to the next and that there were no significant changes in utilization between 2007 and 
2008. 
 
Limitations  
This is the first comparison of ASPs to AMPs that OIG has conducted since CMS 
implemented its revised ASP payment methodology.  Because pricing data in the fourth 
quarter of 2007 were volume-weighted differently than in previous quarters, the results of 
this current pricing comparison are not comparable to those of previous OIG pricing 
comparisons for the purpose of establishing trends over time.  OIG is conducting follow-up 
work to identify the drug codes that would have met the 5-percent threshold if CMSs revised 
ASP payment methodology had been in effect throughout calendar year 2007.  
 
Furthermore, the definition of AMP changed in January 2007, such that AMPs must now be 
determined without regard to customary prompt pay discounts.13  Because manufacturers are 
still required to include customary prompt pay discounts in their ASP calculations, the 
dynamic between ASPs and AMPs may be different in this report as compared to that in OIG 
reports using prices submitted prior to 2007.   
 
Standards 
This inspection was conducted in accordance with the Quality Standards for Inspections 
issued by the Presidents Council on Integrity and Efficiency and the Executive Council on 
Integrity and Efficiency. 
 
RESULTS 
 
Under the Revised ASP Payment Methodology, Volume-Weighted ASPs for 12 of 
285 Drug Codes Exceeded the Volume-Weighted AMPs by at Least 5 Percent  
Consistent with sections 1847A(d)(2)(B) and 1847A(d)(3) of the Act, OIG compared ASPs 
to AMPs to identify instances in which the ASP for a particular drug exceeded the AMP by a 
threshold of 5 percent. In the fourth quarter of 2007, 12 of the 285 HCPCS codes included in 
our review (4 percent) met this 5-percent threshold.  A list of the 12 HCPCS codes, their 
descriptions, and their HCPCS dosage amounts is presented in Appendix C.   
 
Table 1 on the next page describes the extent to which ASPs exceeded AMPs for the                   
12 HCPCS codes.14  For over half of the 12 codes, volume-weighted ASPs exceeded        
volume-weighted AMPs by 20 percent or more.  The ASPs for three of these codes were 
more than double the AMPs. 
 
                                                 
12 At the time of  extraction,  2007 BESS data were 90 percent  complete.     

13 Section 1927(k)(1) of the Act (as amended  by section 6001(c)(1) of the DRA) and Medicaid Drug Rebate
  
Program Bulletin for Participating  Drug Manufacturers, Release No. 76, December 15, 2006. 

14 Because of the confidential nature of ASP data, the information in the table is presented in ranges. 

OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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Table 1: Extent to Which ASPs Exceeded AMPs for 12 HCPCS Codes 
Percentage by Which  Number of 
ASP Exceeded  AMP  HCPCS Codes 
5.00%9.99%  4 
10.00%19.99%  1 
20.00%29.99%  2 
30.00%39.99%  1 
40.00%49.99%  1 
50.00%59.99%  0 
60.00%69.99%  0 
70.00%79.99%  0 
80.00%89.99%  0 
90.00%99.99%  0 
100% and above  3 
     Total  12 
Source: OIG analysis of fourth-quarter 2007 ASP and AMP data, 2008. 
  
 
Lowering reimbursement amounts for the 12 HCPCS codes to 103 percent of the AMPs 
would have reduced Medicare allowances by an estimated $20 million in the second quarter 
of 2008. Sections 1847A(d)(3)(A) and (B) of the Act provide that the Secretary may 
disregard the ASP pricing methodology for a drug with an ASP that exceeds the AMP by at 
least 5 percent. Pursuant to section 1847A(d)(3)(C) of the Act, . . . the Secretary shall, 
effective as of the next quarter, substitute for the amount of payment . . . the lesser of (i) the 
widely available market price . . . (if any); or (ii) 103 percent of the average manufacturer 
price . . . .15  In this study, we identified 12 HCPCS codes that met the 5-percent threshold 
specified in the Act. If reimbursement amounts for these 12 codes had been based on                        
103 percent of the AMPs during the second quarter of 2008, we estimate that Medicare 
expenditures would have been reduced by $20 million in that quarter alone.16  
 
Two of the twelve HCPCS codes accounted for almost 90 percent of the $20 million. If the 
reimbursement amounts for codes J2505 and J3315 had been based on 103 percent of the 
AMP during the second quarter of 2008, Medicare expenditures would have been reduced by 
an estimated $11 million and $7 million, respectively.   
 
                                                 
15 For the purposes of this study, we used 103  percent of the AMP to estimate the impact of lowering  
reimbursement amounts.  If  widely available market prices had been available for these drugs and lower than  
103 percent  of  the AMP, the savings estimates presented in this report  would have been  greater. 
16 This savings estimate assumes that the number of  services that were allowed  by Medicare in  2007  remained  
consistent from one quarter to the next and  that there were no significant  changes in  utilization  between                
2007 and 2008.  
OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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CONCLUSION 
 
For the purpose of monitoring Medicare reimbursement amounts based on ASPs and 
consistent with sections 1847A(d)(2)(B) and 1847A(d)(3) of the Act, OIG compared ASPs 
and AMPs to identify instances in which the ASP for a particular drug exceeded the AMP by 
at least 5 percent. This review is the seventh such comparison conducted by OIG.  Using the 
revised ASP payment methodology recently implemented by CMS, we identified a total of 
12 HCPCS codes in the fourth quarter of 2007 that met the threshold for price adjustment.  
To establish a more useful and consistent benchmark for comparisons of ASPs and AMPs 
over time, OIG is conducting follow-up work to identify the HCPCS codes that would have 
met the 5-percent threshold if CMSs revised ASP payment methodology had been in effect 
during every quarter of 2007. 
   
Some of OIGs previous reports comparing ASPs and AMPs have contained 
recommendations.  We are not making additional recommendations in this report and, as 
such, are issuing the report directly in final form.  If you have comments or questions about 
this report, please provide them within 60 days.  Please refer to report number 
OEI-03-08-00340 in all correspondence. 
OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs     
  Page 10  Kerry Weems  
 
 
APPENDIX A 
 
Equations Used by the Centers for Medicare & Medicaid Services To Calculate                    
Volume-Weighted Average Sales Prices 
In the following equations, a billing unit is defined as the number of Healthcare Common 
Procedure Coding System (HCPCS) code units that are contained in a national drug code 
(NDC). 
 
 
1. 	The Revised Equation Used by the Centers for Medicare & Medicaid  
 Services (CMS) To Calculate Volume-Weighted Average Sales Prices (ASP)  
Beginning April 1, 2008 
 
 
  Volume-Weighted ASP  Sum of (ASP for NDC * Number of NDCs Sold)  
=  
for the Billing Unit of  
  Sum of   (Number of NDCs Sold * Billing Units in NDC)  
 HCPCS Code  
 
 
2. 	The Equation Used by CMS To Calculate Volume-Weighted ASPs Prior to 
April 1, 2008 
 
  ASP for NDC 
* Number of NDCs Sold  
  Volume-Weighted ASP  Sum of 
Billing Units in NDC 
for the Billing Unit of  
=  
 HCPCS Code  
Sum of Number of NDCs Sold   
OEI-03-08-00340  	                                                     Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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APPENDIX B 
 
Previous Office of Inspector General Reports Comparing Average Sales Prices and Average  
Manufacturer Prices 
 
	   Monitoring Medicare Part B Drug Prices:  A Comparison of Average Sales Prices to 
Average Manufacturer Prices (OEI-03-04-00430), April 2006. 
 
	   Comparison of Fourth-Quarter 2005 Average Sales Prices to Average Manufacturer 
Prices: Impact on Medicare Reimbursement for Second Quarter 2006                                
(OEI-03-06-00370), July 2006. 
 
	   Comparison of Third-Quarter 2006 Average Sales Prices to Average Manufacturer 
Prices: Impact on Medicare Reimbursement for First Quarter 2007                                      
(OEI-03-07-00140), July 2007. 
 
 	  Comparison of First-Quarter 2007 Average Sales Prices to Average Manufacturer 
Prices: Impact on Medicare Reimbursement for Third Quarter 2007                                  
(OEI-03-07-00530), September 2007. 
 	  Comparison of Second-Quarter 2007 Average Sales Prices to Average Manufacturer 
Prices: Impact on Medicare Reimbursement for Fourth Quarter 2007                                   
(OEI-03-08-00010), December 2007. 
 
	   Comparison of Third-Quarter 2007 Average Sales Prices to Average Manufacturer 
Prices: Impact on Medicare Reimbursement for First Quarter 2008                                     
(OEI-03-08-00130), May 2008. 
 
OEI-03-08-00340  	                                                     Comparison of Fourth-Quarter  2007 ASPs and AMPs     
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APPENDIX C 
 
Twelve Healthcare Common Procedure Coding System Codes With Average Sales 
Prices That Exceeded Average Manufacturer Prices by at Least 5 Percent in the Fourth 
Quarter of 2007 
 
HCPCS 
Code  Short Description  HCPCS Code Dosage 
J0300  Amobarbital injection  125 mg 
J1120  Acetazolamid sodium injection  500 mg 
J1270  Doxercalciferol injection  1 mcg 
J1364  Erythro lactobionate  500 mg 
J1441  Filgrastim injection  480 mcg 
J1626  Granisetron HCl injection  100 mcg 
J2505  Pegfilgrastim injection  6 mg 
J2690  Procainamide HCl injection  1 g 
J2760  Phentolaine mesylate injection  5 mg 
J3315  Triptorelin pamoate  3.75 mg 
Q0168  Dronabinol oral  5 mg 
Q0169  Promethazine HCl oral  12.5 mg 
Source: Office of Inspector General analysis of fourth-quarter 2007 average sales price and average 
manufacturer price data, 2008. 
 
 
OEI-03-08-00340                                                       Comparison of Fourth-Quarter  2007 ASPs and AMPs