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To the dismay of compounding pharmacists,Medicare officials announced plans for drasticreductions in payments to pharmacies thatmake their own, non-FDA-approved versions ofrespiratory drugs used by asthmatics. The actioncomes on the heels of FDA charges that a numberof pharmacies may be violating federal lawby mass-producing "thousands of doses" ofunapproved respiratory drugs.

In a letter sent to Senate Finance CommitteeChairman Charles Grassley (R, Iowa), Medicareofficials revealed that the program will nolonger pay pharmacists the same amount fordrugs made from raw ingredients as it does forfinished products purchased from the manufacturer.Beginning next January, the program willuse special payment codes under whichMedicare will pay less for pharmacy-made respiratorydrugs.

In his letter to Senator Grassley, formerMedicare Administrator Mark McClellan,MD, PhD,said the payments for pharmacy-made drugs willbe "significantly lower" in order to eliminate "anyinappropriately large financial incentives" forpharmacies to switch patients to these drugs.

Earlier this year, Grassley alerted officials atboth the FDA and Medicare of reports that somepharmacists were switching patients to pharmacy-made respiratory drugs without informingtheir physicians. In some cases, the pharmacymadedrugs were contaminated, he said. For arelated story on Medicare's reaction to compounding,visit ePharmacy Times at

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