Global Life Sciences Update

#DrugPricing: More Average Sales Price Proposals and New Comment Period

January 6, 2026

In the Calendar Year (CY) 2026 Medicare Physician Fee Schedule Final Rule (PFS Final Rule), the Centers for Medicare & Medicaid Services (CMS) finalized significant updates to manufacturer reporting requirements under the Medicare Part B Average Sales Price (ASP) methodology, including by establishing new requirements for pharmaceutical manufacturers to submit written reasonable assumptions (RAs) and certification letters from the recipients of bona fide service fees (BFSFs) that fees are not passed on in whole or in part to a client or customer of the recipient of the fee (BFSF Certification) (described here).

In December 2025, several weeks after publication of the PFS Final Rule, CMS quietly released significant implementation documents related to these new ASP requirements: (1) new FAQ guidance addressing critical aspects of the RA and BFSF Certification requirements and (2) a separate request for comment on the Agency’s intent to collect RAs and BFSF certifications (the Information Collection Request), including the utility and necessity of the request, the associated forms published by the Agency, and the estimated burden of compliance. We provide key highlights of each CMS publication below.

1. FAQ Guidance

On December 19, 2025, CMS published an FAQ publication setting forth critical guidance on how manufacturers are expected to satisfy the RA and BFSF Certification obligations under the PFS Final Rule. Importantly, CMS has not published the FAQ in the Federal Register, nor is the FAQ expressly subject to notice and comment rulemaking. The FAQ provides critical substantive updates regarding the implementation of the new RA and BFSF Certification requirements, including the following:

BFSF Certification Updates

Product-Specific BFSF Certifications. CMS states that a “singular” BFSF Certification is required to be submitted for “each product” for the term of the applicable contract, which could substantially increase the associated administrative burden for those manufacturers with multiple Part B products.
CMS Definition of “New” and “Prospective” Contracts. CMS confirms that the BFSF Certification requirement applies only to “new” and “prospective” contracts. CMS states that whether a contract is “new” or “prospective” is based on the execution date of the contract, not the effective date, and that “new” and “prospective” contracts are limited to those “executed” or “renewed” after January 1, 2026. Contracts executed before January 1, 2026, but with a later effective date would not be considered “new” or “prospective.” CMS also states that the BFSF Certification requirement is triggered by “any change to an existing contract” (emphasis in original). The specific examples given by CMS are “adding a new product, such as a new package size, a newly acquired product, or a new product launch, along with changes in the fee amount or adjustments to the contract term.” Ministerial or contract amendments unrelated to products or fees (e.g., amendments to boilerplate terms such as indemnification) are not expressly addressed.
Lack of BFSF Certification. CMS states explicitly that if a fee recipient declines to provide a certification, the manufacturer may not treat the associated fees as BFSFs.
Frequency. CMS states that manufacturers do not need to submit BFSF Certifications every quarter; instead, BFSF Certifications are required “only when the contract is new or renewed.”
Scope Limited to Part B Drugs. CMS states that the new BFSF Certification requirement applies only to BFSFs “directly related to a Part B drug,” supporting the view that the BFSF Certification is not currently required under the Medicaid Drug Rebate Program.
Template BFSF Certification Form. CMS has posted a copy of the BFSF Certification form here. CMS does not expressly address whether the Agency will accept certifications provided in alternative formats.

Reasonable Assumptions Updates

Reporting Requirements. CMS states that Fair Market Value (FMV) assessments must be submitted for each BFSF contract, with CMS clarifying that it will accept “well-detailed summaries of FMV methodologies that clearly describe the data sources, assumptions, and rationale supporting the determination.” Manufacturers must also submit summaries of all current BFSF contracts and bundled arrangements as part of the quarterly RA submission.
Frequency. CMS clarifies that FMV assessments must be submitted once for each BFSF contract and must be updated when the contract is modified. Manufacturers do not need to resubmit FMV documentation each quarter for continuing contracts.

Other

Restatements. CMS states that manufacturers that must restate ASP for temporal bundles are subject to CMS’ existing restatement policies.

2. Request for Comment on Information Collection Request

On December 30, 2025, CMS separately released a Notice announcing an opportunity for the public to comment on the Information Collection Request under the PFS Final Rule. Copies of the Information Collection Request materials, including a template RA form and BFSF Certification form, are available here.

The Notice requests comments on the Information Collection Request, including the associated forms, “the necessity and utility of the proposed information collection for the proper performance of the agency’s functions, the accuracy of the estimated burden, ways to enhance the quality, utility, and clarity of the information to be collected, and the use of automated collection techniques or other forms of information technology to minimize the information collection burden.”

CMS’ proposed template forms were not widely announced by the Agency when initially published, and the Notice provides a valuable opportunity for interested parties to raise concerns and questions about the draft forms and related reporting requirements. Comments are due by March 2, 2026, and must be submitted through the Office of Information and Regulatory Affairs within OMB.

Attorney Advertising—Sidley Austin LLP is a global law firm. Our addresses and contact information can be found at www.sidley.com/en/locations/offices.

Sidley provides this information as a service to clients and other friends for educational purposes only. It should not be construed or relied on as legal advice or to create a lawyer-client relationship. Readers should not act upon this information without seeking advice from professional advisers. Sidley and Sidley Austin refer to Sidley Austin LLP and affiliated partnerships as explained at www.sidley.com/disclaimer.

© Sidley Austin LLP