Cellular and Gene Therapy Products

Policy ID: Med 112

Effective Date: January 01, 2027

Last Reviewed: June 17, 2026

Applies To: Migrated Commercial

This policy applies to all providers, other health care professionals, hospitals, and other facilities.

Definitions

Code/Term

Code Description/Term Definition

Drug Component (Active Ingredients)

Any component of a drug product intended to furnish pharmacological activity or other direct effect in the diagnosis, cure, mitigation, treatment, or prevention of disease, or to affect the structure or any function of the body of humans or other animals. Active ingredients include those components of the product that may undergo chemical change during the manufacture of the drug product and be present in the drug product in a modified form intended to furnish the specified activity or effect.

FDA

The Food and Drug Administration (FDA) regulates and oversees Cellular and Gene Therapy products. The Office of Therapeutic Products (OTP) is a division of the FDA that regulates advanced therapy medicinal products, including gene and cell therapy and tissue engineered products. OTP lists products approved and licensed for cellular and gene therapy (See Reference section, #5). Note: This list contains products not subject to this policy.

National Drug Code (NDC)

Each listed drug product is assigned a unique 11 digit, 3-segment number. This number, known as the NDC, identifies the labeler, product, and trade package size. The first segment, the labeler code, is assigned by the Food and Drug Administration (FDA). A labeler is any firm that manufactures (including repackers or relabelers) or distributes (under its own name) the drug. The second segment, the product code, identifies a specific strength, dosage form, and formulation of a drug for a particular firm. Different formulations or different strengths of the same formulation should be assigned different product codes. The third segment, the package code, identifies package sizes and types. Different package codes only differentiate between different quantitative and qualitative attributes of the product packaging.

Policy Statement

This reimbursement policy applies to the products listed in Appendix 1.
The products listed in Appendix 1 may also be subject to medical necessity pre-authorization (PA) review.
For the purpose of the products subject to this reimbursement policy, drug components and NDC applies to FDA approved agents/drugs.

For reimbursement evaluation, supplier or manufacturer invoice and NDC of the agents/drugs are required for the drug component(s). Drug component charges must be uniquely identified from other charges associated with the inpatient or outpatient services on a separate claim line. Drug component charges must be the facility’s actual acquisition cost by invoice. A claim line will be denied if the health plan is unable to identify the charges.

Reimbursement for the drug component(s) will be at the supplier or manufacturer invoice price. If supplier or manufacturer invoice is not provided, reimbursement will be 75% of wholesale acquisition cost (WAC) published by MediSpan.

Any off-invoice discount, rebate or refund for the drug component received by the facility must be returned in full to the health plan. Additionally, the health plan must not be billed if no payment has been made by the provider for the drug component.

References

Cross References

Med 108 – Discarded Drugs and Biologicals
Immunological Cellular Therapies and Gene Therapies, Medicine, Policy No. 42
Medicare; Immunological Cellular Therapies and Gene Therapies, M-Medicine No. 42

Disclaimer

Your use of this Reimbursement Policy constitutes your agreement to be bound by and comply with the terms and conditions of the Reimbursement Policy Disclaimer.

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