Pharmacy Affairs

Schering-Plough Letter - Refunds to 340B Covered Entities

May 15, 2008

Jimmy Mitchell, R.Ph., M.P.F ., M.S.
Director
Office of Pharmacy Affairs
Health Resources and Services Administration
Department of Health and Human Services
5600 Fishers Lane, Parklawn Building
Mail Stop 10C-03
Rockville, Maryland 20857

Re: Refunds to 340B Covered Entities for Certain 2006-2007 Purchases

Dear Mr. Mitchell:

I am writing on behalf of the Schering-Plough Corporation (Schering-Plough) concerning the refunds we are providing to Section 340B program covered entities that purchased certain products of Organon BioSciences N.V. (Organon) in 2006 and 2007. Schering-Plough completed the acquisition of Organon in November 2007. Schering- Plough has learned that Organon's ceiling prices to 340B covered entities were overstated in three of the four quarters predating the acquisition. Consistent with Schering-Plough's commitment to compliance, we have made a disclosure regarding this matter to the Department of Health and Human Services Office of Inspector General and arc making refunds to covered entities for the Organon 340B ceiling price overstatements. The refunds will involve the following products and quarters: (1) purchases of Desogen® in the fourth quarter of 2006; (2) purchases of Zemuron® in the first quarter of 2007; and (3) purchases of NuvaRing®, Cyclessa®, and Desogen® in the second quarter of 2007. Schering-Plough is currently processing refunds, which we will be sending to all entities we identify as having purchased one of the affected products for outpatient use that did not receive the correct ceiling price during a relevant quarter in which the entity was registered with the Health Resources and Services Administration (HRSA) as a 340B covered entity. We expect to have this process completed by August of 2008.

If you have any questions about this matter, please feel free to contact me at 908- 298-2292. While Schering-Plough will be independently contacting covered entities that we identify as eligible for refunds, please feel free to post this letter on HRSA's website to help us inform eligible 340B covered entities of the refunds. Covered entities may direct any inquiries they may have about refund processing to Barry Schnepf at 908-629-3430. We value our relationship with HRSA and our 340B customers and appreciate your cooperation and assistance.