U.S. Capitol Building in Washington, D.C.

Article

Engaging the federal marketplace

April 9, 2019 · Authored by Jeff K. Clayton, Jenny McElhenny

As life sciences companies evaluate different avenues for growth, many are considering the federal marketplace. Expanding into the federal marketplace requires different considerations than expanding into new geographies or product lines. This Q&A addresses some of those considerations and issues.

Why is the federal market important for life sciences companies?

The federal market represents a significant business opportunity. The Department of Veterans Affairs (VA) Federal Supply Schedule (FSS) Big Four - the VA, Department of Defense (DOD), Public Health Service (PHS), and Coast Guard - represent over 20 million lives, including a large over 65 population. Even more important, the federal market covers our active duty and retired military service members, who deserve access to the best and most technologically advanced drugs, biologics, devices, equipment and other medical treatments. Additionally, a majority of doctors and other healthcare professionals are trained or work in VA/DoD facilities at some point in their careers. These individuals have influence beyond the federal market, and providing them with the opportunity to access life sciences companies’ products in any setting can have far-reaching impacts.

Also important to note, it is a statutory requirement for some drugs and biologics to be sold through the VA FSS program.

Who are the major players in the federal marketplace?

The two largest buyers of pharmaceuticals, medical equipment, and healthcare services in the federal marketplace are the VA and the DOD.

The Veterans Health Administration (VHA) serves more than 9 million lives and is separated into 18 Veterans Integrated Services Networks (VISNs). This system has approximately 150 VA Medical Centers and 1,200 Community Based Outpatient Clinics. In terms of pharmaceuticals, the VA has a national formulary called the Veterans Affairs National Formulary (VANF). Understanding the formulary, the process the VA employs for establishing criteria for use for pharmaceuticals, the broader contracting and pricing landscape, and how it can impact uptake in this market (for drugs and other treatments) is vitally important to a company’s success. Key influencers include: