How can Express Scripts get a no-bid contract for PDMP?

   

JEFFERSON CITY, Mo. – One week after the announcement of Governor Eric Greitens’ executive order seeking to establish a prescription drug monitoring program (PDMP) in the Show-Me State, Missouri lawmakers are still scratching their heads and wondering how the Governor can award a contract without allowing bidding for the contract.

The issue at hand is that for nearly all government contracts are subject to the state’s required bidding process, which was set up in an attempt to ensure fairness in the contract awarding process.

But with Governor Greitens’ executive order, it was also announced that the state would enter into a contract with Express Scripts to put the PDMP startup in place, with an estimated $250,000 price tag.

That contract, the Missouri Times found out, was a no-bid contract. But how is that possible?

Some speculated that the deal is allowed through an existing contract, as Express Scripts currently serves as the provider for prescription drugs for state employees. But a spokesperson for the Office of Administration says that the proposed contract is not an expansion of any existing contract.

“The state anticipates that it will be entering into a single feasible source contract, as permitted by section 34.044, RSMo.,” OA’s Ryan Burns told the Missouri Times.

Section 34.044, RSMo. is the law pertaining to “Single Feasible Source Request Procedures”. This section of the statute defines the requirements needed to justify an SFS procurement:

A. Supplies are proprietary and only available from the manufacturer or a single distributor, or
B. Based on past procurement experience, it is determined that only one distributor services the region in which the supplies are needed; or

C. Supplies are available at a discount from a single distributor for a limited period of time.

“The pharmacy prescription and dispensing data held by Express Scripts is unique to it, as it would be for each individual pharmacy benefits management organization,” Burns explained. “As such, Express Scripts, Inc. has specific data solely in its possession and has a proprietary tool to perform data analyses. This data is exclusive to Express Scripts and Express Scripts owns the tool that performs the analyses of its data.”

Any procurement that is valued at more than $25,000 requires the Department to submit a requisition to the Division of Purchasing and Materials Management for an SFS. In that request, they must explain how the procurement meets the legal definition of an SFS, why the supply of resources is the only one that will meet their needs, and if necessary, documentation from the vendor noting which specific supplies should be included.

And, using the required test as lined out by statute, the proposed contract would meet the statutory requirements, meaning that the contract can be awarded without going through the competitive bidding process. Burns also noted that the same process can be used by other organizations for analysis of their exclusive data.

Brian Henry, the spokesman for Express Scripts, said the company will follow any guidelines that are requested of them.

“We look forward to working with the state to help address the opioid crisis,” Henry said in a written statement. “If and when we enter into any formal agreement, we will abide by all procurement procedures, as we would do in any of our agreements.”

The question as to how the funding will be supplied by the state is still unclear. While returning to the Senate chambers on Monday evening, several members of the body questioned how the Governor might appropriate money for his new PDMP program.

 

Benjamin Peters is a reporter for the Missouri Times and Missouri Times Magazine, and also produces the #MoLeg Podcast. He joined the Missouri Times in 2016 after working as a sports editor and TV news producer in mid-Missouri. Benjamin is a graduate of Missouri State University in Springfield. To contact Benjamin, email benjamin@themissouritimes.com or follow him on Twitter @BenjaminDPeters.