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bona fide service fee

Defined in 1 place of the United States Code.

The term “bona fide service fee” means a fee that is reflective of the fair market value (as specified by the Secretary, through notice and comment rulemaking) for a bona fide, itemized service actually performed on behalf of an entity, that the entity would otherwise perform (or contract for) in the absence of the service arrangement and that is not passed on in whole or in part to a client or customer, whether or not the entity takes title to the drug. Such fee must be a flat dollar amount and shall not be directly or indirectly based on, or contingent upon—

(i) drug price, such as wholesale acquisition cost or drug benchmark price (such as average wholesale price);

(ii) the amount of discounts, rebates, fees, or other direct or indirect remuneration with respect to covered part D drugs dispensed to enrollees in a prescription drug plan, except as permitted pursuant to paragraph (1)(A)(ii);

(iii) coverage or formulary placement decisions or the volume or value of any referrals or business generated between the parties to the arrangement; or

(iv) any other amounts or methodologies prohibited by the Secretary.

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