§ 423.2716 Phase-in of applicable discount for certain manufacturers.

(a) Specified manufacturer. Subject to the limitation with respect to manufacturer acquisitions described at § 423.2724, a specified manufacturer is a manufacturer of an applicable drug that, in 2021, had— (1) A Coverage Gap Discount Program agreement, as described at § 423.2315, in effect in accordance with § 423.2720(a)(1); (2) Total expenditures for all of its specified drugs (as defined in § 423.2704) covered by a Coverage Gap Discount Program agreement for 2021 and covered under Part D in 2021 represented less than 1.0 percent of total expenditures for all Part D drugs in 2021; and (3) Total expenditures for all of its specified drugs that are single source drugs and biological products for which payment may be made under Part B in 2021 represented less than 1.0 percent of the total expenditures under Part B for all drugs or biological products in 2021. (b) Specified small manufacturer. Subject to the limitation with respect to manufacturer acquisition described at § 423.2724, a specified small manufacturer is a manufacturer of an applicable drug that, in 2021— (1) Is a specified manufacturer as described in paragraph (a) of this section; and (2) The total expenditures under Part D for any one of its specified small manufacturer drugs covered under a Coverage Gap Discount Program agreement for 2021 and covered under Part D in 2021 are equal to or greater than 80 percent of the total expenditures for all its specified small manufacturer drugs covered under Part D in 2021. (c) Aggregation rule. All entities, including corporations, partnerships, proprietorships, and other entities treated as a single employer under subsection (a) or (b) of section 52 of the Internal Revenue Code of 1986 are treated as one manufacturer for purposes of this section.