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Applicable Manufacturers and GPOs


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Applicable Manufacturers and Group Purchasing Organizations

How does Open Payments affect applicable manufacturers and applicable GPOs?

Open Payments (commonly known as the Sunshine Act) requires applicable manufacturers and applicable group purchasing organizations (GPOs) to report certain payments and other transfers of value given to physicians and teaching hospitals, and any ownership or investment interest physicians, or their immediate family members, have in their company. This information must be reported every year.

Is your organization required to report data?

The chart below will tell you if your organization is an applicable manufacturer or GPO that needs to report payments or transfers of values to Open Payments.

You’re an applicable manufacturer if…

  Type 1 Manufacturer Type 2 Manufacturer
Operate in US? Your physical location is within the United States and/or your activities are within the United States. This includes any territory, possession, or commonwealth of the United States.
Activities
  • Engages in the production, preparation, propagation, compounding, or conversion of a covered drug, device, biological, or medical supply.
  • This includes distributors or wholesalers that hold title to a covered drug, device, biological, or medical supply
  • Exists under common ownership with a Type 1 applicable manufacturer
    AND
  • Provides assistance or support to such an entity with respect to the production, preparation, propagation, compounding, sale, or distribution of a covered drug, device, biological, or medical supply.

 
 Covered products
  • Produces at least one product reimbursed by Medicare, Medicaid, or Children’s Health Insurance Program
    AND
  • If the product is a drug or biological, and it requires a prescription (or physician’s authorization) to administer
    OR
  • If the product is a device or medical supply, and it requires premarket approval or premarket notification by the FDA.
    EXEMPTIONS
  • Applicable manufacturers and GPOs with less than 10 percent of revenues from covered products do not need to report all payments or other transfers of value as proposed, but rather are only required to report payments or other transfer of value that are related to one or more covered drugs, devices, biologicals or medical supplies.
  • Foreign entities that may contribute to the manufacturing process of a covered product but have no business presence in the United States.
  • Entities that only manufacture raw materials or components, which are not themselves covered products, will not be required to report unless they are under common ownership with an applicable manufacturer and assist such manufacturer with the production, preparation, propagation, compounding, conversion, marketing, promotion, sale, or distribution of a covered drug, device, biological, or medical supply.
  • Entities such as hospitals, hospital-based pharmacies and laboratories that manufacture a covered product solely for use by or within the entity itself or by an entity’s own patients.
  • Wholesalers or distributors that do not hold the title of a covered product will not be subject to the reporting requirements, unless they are under common ownership with an applicable manufacturer and provide assistance or support with respect to a covered drug, device, biological, or medical supply.
  • If an applicable manufacturer does not manufacture a covered drug, device, biological, or medical supply except pursuant to a written agreement to manufacture the covered product for another entity, does not hold the FDA approval, licensure or clearance for the product, and is not involved in the sale, marketing or distribution of the product, then the manufacturer is only required to report payments or other transfers of value related to the covered product. This is described in the regulatory text at § 403.904(b)(4).

 

You are an applicable GPO if….

  Group Purchasing Organization If
Operate in US?
  • Entity’s physical location is within the United States and/or it conducts activities within the United States. This includes any territory, possession, or commonwealth of the United States.
Activities
  • Purchases, arranges for, or negotiates the purchase of a covered drug, device, biological, or medical supply for a group of individuals or entities, but not solely for use by the entity itself.
Covered Products
  • At least one product is reimbursed by Medicare, Medicaid or Children’s Health Insurance Program  
    AND
  • If the product is a drug or biological, it requires a prescription (or Physician’s authorization) to administer
    OR
  • If the product is a device or medical supply, it requires pre-market approval or premarket notification by the FDA.


How does your organization participate in Open Payments?

To participate in Open Payments, applicable manufacturers and GPOs need to:

All Open Payments program cycles consist of a full 12 months of calendar year data which must be collected and reported to CMS.  It is then published on this website each year on June 30.

More information, including a complete list of quick reference guides, and the Open Payments user guide can be found on the Resources page.


Open Payments