N.Y. Comp. Codes R. & Regs. tit. 12, § 440.2 – Definitions.

(a) Average Wholesale Price or AWP means the average wholesale price of a prescription drug as provided in the most current release of the Red Book published by Thomson Reuters or Medi-Span Master Drug Database by Wolters Kluwar Health or any successor publisher, on the day a prescription drug is dispensed or other nationally recognized drug pricing index adopted by the chair or chair’s designee.
(b) Brand name drug means a drug for which an application is approved under the Federal Food, Drug, and Cosmetic Act section 505(c).
(c) Calculated cost means the average wholesale price for the national drug code of the prescription drug or medicine on the day it was dispensed plus a dispensing fee. For brand name drugs the calculated cost shall be AWP minus 12 percent of the average wholesale price plus a dispensing fee of $4. For generic drugs the calculated cost shall be AWP minus 20 percent plus a dispensing fee of $5.
(d) Contract price means the maximum amount that a designated pharmacy (as set forth in section 440.3 of this Part) will pay a pharmacy for generic drugs and brand name drugs that have generic versions available (multi-source brands).
(e) Controlled substance has the meaning provided in Public Health Law section 3306.
(f) Formulary means the New York Workers’ Compensation Formulary which is a list of drugs for work-related injuries that is incorporated by reference in section 441.2 of this Part and that must be used to prescribe medication for all disability events. The formulary includes medications available in phase A and B; and, also includes a list of medications available for perioperative periods that may be prescribed without prior authorization during the applicable phase or perioperative period.
(g) Generic drug means an FDA-approved drug that is therapeutically equivalent to a brand name drug, as determined by the FDA’s designation of the drug with the therapeutic equivalence evaluation code designation as an “A” product in the Approved Drug Products with Therapeutic Equivalence Evaluations (commonly referred to as the Orange Book), irrespective of dosage for the route of administration (oral, topical or systemic) prescribed. A brand name drug may not be dispensed when a generic version of the same active ingredient is commercially available in a different strength/dosage.
(h) Independent pharmacy means a pharmacy (including a remote pharmacy) that is not part of a pharmacy chain.
(i) Insurance carrier means the State Insurance Fund, stock corporations, mutual corporations or reciprocal insurers with which employers have insured, and any special fund maintained by the board that is responsible for paying for medical treatment and care of injured workers, including but not limited to, the Special Fund for Reopened Cases created and governed by Workers’ Compensation Law section 25-a and the Uninsured Employers’ Fund created and governed by Workers’ Compensation Law section 2-a.
(j) Pharmacy benefit management means the services provided to a self-insured employer or insurance carrier, directly or through another entity, including:
1. (1) the negotiation of the amount to be paid for prescription medicine or drugs by the self-insured employer or insurance carrier and the amount paid to independent pharmacy, pharmacy chain, or remote pharmacy dispensing prescription medicine or drugs;
2. (2) procurement of prescription medicines or drugs to be dispensed to injured employees; or
3. (3) the administration or management of prescription medicine or drug benefits, including, but not limited to, any of the following:
  1. (i) mail service pharmacy;
  2. (ii) claims processing, New York Pharmacy Formulary administration and prior authorization review, retail network contracting and management, or payment of claims to pharmacies for dispensing prescription medicines or drugs;
  3. (iii) patient compliance, therapeutic intervention, or generic substitution programs;
  4. (iv) disease management; and
  5. (v) retrospective review.
(k) Pharmacy benefit manager means any entity that performs pharmacy benefit management for a self-insured employer or insurance carrier.
(l) Pharmacy chain means any entity that has been designated by a carrier or self-insured employer under section 440.3(a) of this Part that is:
1. (1) a group of pharmacies (including remote pharmacies) under common ownership; or
2. (2) a group of pharmacies (including remote pharmacies) linked to the same company via franchise agreements.
(m) Pharmacy processing agent means person or entity that contracts with a pharmacy as permitted by law, establishing an agent or assignee relationship, to process claims and act on behalf of the pharmacy under the terms and conditions of a contract related to services being billed. Such contracts may permit the agent or assignee to submit billings, request reconsideration, receive reimbursement, and seek medical dispute resolution for the pharmacy services billed.
(n) Remote pharmacy means any pharmacy that sells anywhere in New York State by mail, phone and/or internet.
(o) Repackaging is the act of taking a finished drug product from the container in which it was distributed by the original manufacturer and placing it into a different container without further manipulation of the drug. Repackaging also includes the act of placing the contents of multiple containers (e.g., vials) of the same finished drug product into one container when the container does not include other ingredients.
(p) Rural area means counties within the state having a population of less than 200,000, and the municipalities as are found therein, and in counties having a population of 200,000 or greater, rural areas means towns with population densities of 150 persons or less per square mile, and the villages and other municipalities as are found therein. For purposes of this Part, a rural area does not include municipalities which are incorporated cities or villages having a population of 2,500 or more.
(q) Self-insured employer means an employer permitted by the chair to pay compensation and medical benefits directly under the provisions of Workers’ Compensation Law section 50(3), (3-a) or (4).
(r) Third party payor means any self-insured employer, insurance carrier, nonprofit hospital service plan, health care service plan, health maintenance organization, or any person or other entity which provides payment for medical and related services.
(s) Usual and customary price means the retail price charged to the general public for a prescription drug.