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136 STAT. 1872 PUBLIC LAW 117–169—AUG. 16, 2022 form and strength with respect to such part D rebatable drug for the period. ‘‘(B) EXCLUDED UNITS.—For purposes of subparagraph (A)(i), beginning with plan year 2026, the Secretary shall exclude from the total number of units for a dosage form and strength with respect to a part D rebatable drug, with respect to an applicable period, units of each dosage form and strength of such part D rebatable drug for which the manufacturer provides a discount under the program under section 340B of the Public Health Service Act. ‘‘(C) REDUCTION OR WAIVER FOR SHORTAGES AND SEVERE SUPPLY CHAIN DISRUPTIONS.—The Secretary shall reduce or waive the amount under subparagraph (A) with respect to a part D rebatable drug and an applicable period— ‘‘(i) in the case of a part D rebatable drug that is described as currently in shortage on the shortage list in effect under section 506E of the Federal Food, Drug, and Cosmetic Act at any point during the applicable period; ‘‘(ii) in the case of a generic part D rebatable drug (described in subsection (g)(1)(C)(ii)) or a bio- similar (defined as a biological product licensed under section 351(k) of the Public Health Service Act), when the Secretary determines there is a severe supply chain disruption during the applicable period, such as that caused by a natural disaster or other unique or unex- pected event; and ‘‘(iii) in the case of a generic Part D rebatable drug (as so described), if the Secretary determines that without such reduction or waiver, the drug is likely to be described as in shortage on such shortage list during a subsequent applicable period. ‘‘(2) DETERMINATION OF ANNUAL MANUFACTURER PRICE.— The annual manufacturer price determined under this para- graph for a dosage form and strength, with respect to a part D rebatable drug and an applicable period, is the sum of the products of— ‘‘(A) the average manufacturer price (as defined in subsection (g)(6)) of such dosage form and strength, as calculated for a unit of such drug, with respect to each of the calendar quarters of such period; and ‘‘(B) the ratio of— ‘‘(i) the total number of units of such dosage form and strength reported under section 1927 with respect to each such calendar quarter of such period; to ‘‘(ii) the total number of units of such dosage form and strength reported under section 1927 with respect to such period, as determined by the Secretary. ‘‘(3) DETERMINATION OF INFLATION-ADJUSTED PAYMENT AMOUNT.—The inflation-adjusted payment amount determined under this paragraph for a dosage form and strength with respect to a part D rebatable drug for an applicable period, subject to paragraph (5), is— ‘‘(A) the benchmark period manufacturer price deter- mined under paragraph (4) for such dosage form and strength with respect to such drug and period; increased by Effective date. VerDate Sep 11 2014 13:57 Oct 25, 2022 Jkt 029139 PO 00169 Frm 00056 Fmt 6580 Sfmt 6581 E:\PUBLAW\PUBL169.117 PUBL169 jmbennett on LAP3P8D0R2PROD with Publaw