Company: OCEA
Filing Date: 2025-04-08
Form Type: 10-K
Source: 0001641172-25-003155
Chunk: 2563

Company: Ocean Biomedical, Inc.
Filing Date: 2025-04-08
Form: 10-K
Item: Item 1
Chunk 2563
---
 the first instance.

The
Medicare Prescription Drug, Improvement, and Modernization Act of 2003, or the MMA, established the Medicare Part D program to provide
a voluntary prescription drug benefit to Medicare beneficiaries. Under Part D, Medicare beneficiaries may enroll in prescription drug
plans offered by private entities that provide coverage of outpatient prescription drugs. Unlike Medicare Parts A and B, Part D coverage
is not standardized. Part D prescription drug plan sponsors are not required to pay for all covered Part D drugs, and each drug plan
can develop its own drug formulary that identifies which drugs it will cover and at what tier or level. While all Medicare drug plans
must give at least a standard level of coverage set by Medicare, Part D prescription drug plan sponsors are not required to pay for all
covered Part D drugs, and each drug plan can develop its own drug formulary that identifies which drugs it will cover and at what tier
or level. However, Part D prescription drug formularies must include drugs within each therapeutic category and class of covered Part
D drugs, though not necessarily all the drugs in each category or class. Any formulary used by a Part D prescription drug plan must be
developed and reviewed by a pharmacy and therapeutic committee. Government payment for some of the costs of prescription drugs may increase
demand for drugs for which we obtain marketing approval. Any negotiated prices for any of our products covered by a Part D prescription
drug plan will likely be lower than the prices we might otherwise obtain. Moreover, while the MMA applies only to drug benefits for Medicare
beneficiaries, private payors often follow Medicare coverage policy and payment limitations in setting their own payment rates. Any reduction
in payment that results from the MMA may result in a similar reduction in payments from non-governmental payors.

65

For
a drug product to receive federal reimbursement under the Medicaid or Medicare Part B programs or to be sold directly to United States
government agencies, the manufacturer must extend discounts to entities eligible to participate in the 340B drug pricing program. The
required 340B discount on a given product is calculated based on the average manufacturer price, or AMP, and Medicaid rebate amounts
reported by the manufacturer. As of 2010, the ACA expanded the types of entities eligible to receive discounted 340B pricing, although
under the current state of the law these newly eligible entities (with the exception of children’s hospitals) will not be eligible
to receive discounted 340B pricing on orphan drugs. As 340