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Letter from Douglas W. Elmendorf, Director Congressional Budget Office to Kent Conrad including report: The Department of Veterans Affairs' Pharmaceutical Prime Vendor Program 1 (February 2009)

handle is hein.congrec/cbo9771 and id is 1 raw text is: CONGRESSIONAL BUDGET OFFICE Douglas W. Elmendorf, Director U.S. Congress Washington, DC 20515 February 25, 2009 Honorable Kent Conrad Chairman Committee on the Budget United States Senate Washington, DC 20510 Dear Mr. Chairman: In response to your request, the Congressional Budget Office (CBO) has studied the Pharmaceutical Prime Vendor program, which the Department of Veterans Affairs (VA) uses to purchase prescription drugs. As you noted in your request, VA currently uses a single vendor, whereas the Department of Defense (DoD) contracts with multiple vendors to purchase drug products dispensed at military treatment facilities and through the TRICARE Mail Order Pharmacy program. The discount that VA has negotiated with its single vendor is comparable with the corresponding discounts that DoD has negotiated with its three national vendors. Thus, CBO finds that requiring VA to award contracts to multiple vendors would be unlikely to result in substantial cost savings in VA's drug purchases. We would be pleased to answer any further questions that you may have. The staff contact is Elizabeth Bass, who can be reached at (202) 226-2925. Sincerely, Douglas W. Elmendorf Enclosure cc: Honorable Judd Gregg Ranking Member Senate Committee on the Budget www.cbo.gov

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