Prescription Drug Wholesale Acquisition Cost (WAC) Increases

Overview

The Office of Statewide Health Planning and Development (OSHPD) has released to the public the mandatory reporting of information related to increases to the Wholesale Acquisition Cost (WAC) of prescription drugs by drug product as identified by the drug product’s National Drug Code (NDC). Health and Safety Code §127679 requires prescription drug manufacturers to report quarterly specified WAC increases of more than 16%, beginning January 1, 2019. The current public release includes all the data in completed reports submitted as of April 8, 2021 by prescription drug manufacturers for specified WAC increases with effective dates in 2020. For a full list of the information of WAC increases collected by OSHPD, see the data format and file specifications.

Note: Not all required increases are reported, additionally, some of the reported increases are not required. There are increases that do not meet the statutory requirements for reporting and prescription drugs that do not meet the definition for reporting under the Regulations and Section 321(g) of Title 21 of the United States Code. The visualizations on this page only reflect reported data. Due to increases that do not require reporting, if all required reports were submitted, the data still may not include all prescription drugs.  

Table of Contents

  1. Download Dataset
  2. WAC Increase Data Analytics
  3. CTRx Term Definitions

Download Dataset

The current year WAC Increase data available for download is updated monthly. Click the ‘Download Dataset’ button below to view/download the latest WAC Increase Dataset.

WAC Increase Data Analytics

WAC Increase Data Graph – Current Year
Visit this page for interactive graphs that include submitted WAC Increase Report data from 2020. The interactive graphs give you an opportunity to customize the data by WAC Price Category, Drug Source Type, or both.

WAC Increase Data Graph – Cumulative
Visit this page for interactive graphs that show the volume of reports and the median WAC percent increase. These interactive graphs allow you to customize the data by Drug Source Type and WAC Price Category.

CTRx Term Definitions

Wholesale Acquisition Cost

Wholesale Acquisition Cost (WAC) is defined in the U.S. Code as “…the manufacturer’s list price for [a] drug or biological to wholesalers or direct purchasers in the United States, not including prompt pay or other discounts, rebates or reductions in price…”

National Drug Code (NDC)

The pharmaceuticals industry assigns a unique three-segment number, called the NDC, to each drug product manufactured and sold.  NDCs must be provided to the federal Food and Drug Administration (FDA), and are used for ordering, billing, inventory management, and recalls.

OSHPD requires that relevant reporting uses the 11-digit format of the NDC.  The three-segments of the format can be broken into the following:

National Drug Code Template

The labeler code, also known as the manufacturer code, identifies who manufactures, repacks, or distributes a given drug product.

The product code identifies the drug, its strength, dosage form, and formulation specific to the firm that manufactures the given drug product.

The packaging code typically identifies the number of product units in the given product (package size), but also may indicate the type of packaging used.

Specified WAC Increases

As specified by California Statute are those “…with a wholesale acquisition cost of more than forty dollars ($40) for a course of therapy … if the increase in the wholesale acquisition cost of a prescription drug is more than 16 percent, including the proposed increase and the cumulative increases that occurred within the previous two calendar years prior to the current year. For purposes of this section, a “course of therapy” is defined as either of the following:

(1) The recommended daily dosage units of a prescription drug pursuant to its prescribing label as approved by the federal Food and Drug Administration for 30 days.

(2) The recommended daily dosage units of a prescription drug pursuant to its prescribing label as approved by the federal Food and Drug Administration for a normal course of treatment that is less than 30 days.

3-Year Percent Increase in WAC

The three-year percent WAC increase is determined by compiling the current year-to-date increase data with the previous two calendar years. If these combined increases exceed a 16 percent price increase, then a WAC increase report must be filed. OSHPD calculates its cumulative three-year WAC median percent increase by combining current year-to-date data with the previous two calendar years.

Drug Source

Defined in the U.S. Code as either:

(1) A single source drug which means a drug “…which is produced or distributed under a new drug application approved by the Food and Drug Administration, including a drug product marketed by any cross-licensed producers or distributors operating under the new drug application… and also includes a …drug that is a biological product licensed, produced, or distributed under a biologics license application approved by the Food and Drug Administration…” Prescription drugs of this source type are often referred to as brand drugs.

(2) A multiple source drug which means a drug “…for which there is at least 1 other drug product which— (I) is rated as therapeutically equivalent (under the Food and Drug Administration’s most recent publication of “Approved Drug Products with Therapeutic Equivalence Evaluations”), (II) except as provided in subparagraph (B), is pharmaceutically equivalent and bioequivalent, as defined in subparagraph (C) and as determined by the Food and Drug Administration, and (III) is sold or marketed in the United States during the period.”

(3) An innovator multiple source drug which “…means a multiple source drug that is marketed under a new drug application approved by the Food and Drug Administration…” Prescription drugs of this source type can be primarily referred to as generic drugs, although a manufacturer of this type of generic would have been granted special authorization to produce the generic while the relevant brand drug was still under protection. In addition, this source type includes the brand drug after protection has expired.

(4) A noninnovator multiple source drug which “…means a multiple source drug that is not an innovator multiple source drug.” Prescription drugs of this source type are often referred to as generics.

Annual Dataset Updates

Annual datasets of reports from the preceding year are reviewed in the second half of the current year to identify if any revisions or additions have been made since the original release of the datasets. If revisions or additions have been found, an update of the datasets will be released. Datasets will be clearly marked with ‘Updated’ in their titles for convenient identification. Not all datasets may require an updated release. The review of previously released datasets will only be conducted once to determine if an updated release is necessary. Datasets with revisions or additions that may been made after the one-time review can be requested. These requests should be made via email at ctrx@oshpd.ca.gov.

Data and Resources#

Additional Information#

Topic: Healthcare
Temporal Coverage: January to May 2021
Spatial/Geographic Coverage: Statewide
Frequency: Monthly
Citation: Office of Statewide Health Planning and Development (OSHPD), Prescription Drug Cost Transparency