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FDA Approval Status of Drugs in the Medicaid Drug Rebate Program

The Food and Drug Administration (FDA) is responsible for ensuring that new drugs are safe and effective before they can be approved for marketing in the United States. With certain exceptions, drugs generally must be FDA-approved for safety and effectiveness to qualify for Federal payments under Medicaid. Under the Medicaid Drug Rebate Program, a drug manufacturer must provide the Centers for Medicare & Medicaid Services (CMS) with its FDA-assigned labeler code and a complete list of drugs marketed by the company. Drug manufacturers are also generally required to enter into rebate agreements with the Secretary of Health and Human Services and pay quarterly rebates to States to qualify for Federal payments under Medicaid. At the request of Congress, we will review the FDA approval status of drugs covered under the Medicaid Drug Rebate Program. We will also determine what steps CMS takes to review the FDA approval status of drugs and prevent inappropriate payments for unapproved drugs under the Medicaid Drug Rebate Program.

Announced or Revised Agency Title Component Report Number(s) Expected Issue Date (FY)
June 2017 Centers for Medicare & Medicaid Services FDA Approval Status of Drugs in the Medicaid Drug Rebate Program Office of Evaluation and Inspections OEI-03-17-00120 2019