Cardinal Health Contract Overview

TACHC has been working with Cardinal Health since 1995. This long-term relationship has created a powerful pharmacy program to service health centers across the U.S. The current group's annual sales are at $82 million.

Payment Terms:
Semi-Monthly paying of statements. Statement for invoices dated between the 1st and the 15th are due by the 25th of the SAME month. Statements for invoices dated between the 16th and the end of the month are due by the 10th of the FOLLOWING month.

Explanation of Alternative A:
Five free deliveries per week per site daily.

General Information

• Cardinal Health will provide a representative on call to the centers at least once per month initially and as requested or required thereafter.
• If you have pharmaceutical products that you would like added to the inventory, Cardinal Health will make every effort to carry it.
• Cardinal Health will assure dialogue between themselves and pharmaceutical manufacturers should charge-back denials occur under the TACHC contracts or the 340B contract.
• Cardinal Health asks that each facility to provide Cardinal with accurate 6 month usage figures. Cardinal Health operates a "live" inventory system that allocates inventory at the moment of order transmission. Order allocations are transmitted to the facility within approximately 15 minutes of placing the order and contain invoice level detail.

Purchase Order Entry System

• A pie chart is displayed that analyzes contract compliance of the order and allows the user to re-enter the order to edit. This will allow the facility to achieve higher contract compliance by calculating the percentage of the order's contract items, non-contract items, and items with generic equivalents on contract and will display this information in an easy-to-read graphic format.

Report System

• Report Generator: allows the user to create custom reports or select one of several special purpose reports that are partially defined and easily modified, including the 80/20 Report, Contract Compliance First Quarter Report, Contract Compliance Report 12 Months, Contract Expiration by Manufacturer Report, Invoice History by Item Description Report, Items by AHFS Name Report, Percentage Report by Manufacturer, Quarterly Report by Manufacturer, Substitutions Report by Generic, Therapeutic Report, Top 200 Items Report, Utilization Report, and Velocity Report by Manufacturer.
• Contract Compliance Savings Reports: pre-defined and will allow the user to report the monthly and yearly savings accumulated when replacing non-contract items on a purchase order with contract items during the purchase order building process.
• Free Form Pie Chart: allows the user to create custom-designed pie charts displaying up to 5 of the top ranking items or groups of items such as AHFS, generic, drug class and more.
• Other: the following reports are generated automatically by Cardinal Health and picked up by the user at the next communication session: Order confirmation, price inquiry update, invoice confirmation, credit confirmation, price change, and availability reports.
• Each pharmacy participating with the 340Better^SM contract will be assigned a trained sales representative. This Cardinal representative should be the first line of contact for: pricing questions, order accuracy, delivery questions, product availability, special orders, drop ship orders.

Return Goods Policy

• The returnable condition will be determined by Cardinal Health based upon its ability to return the item to its inventory for resale in the normal course of its business without special preparation, testing, handling, or expense and will exclude the following:
  • Any item which has been used or opened, is only partially complete, or is without all original packaging, labeling, inserts, or operating manuals.
  • Short-dated, outdated, or seasonal product.
  • Product that is stickered, marked, damaged, defaced, or otherwise cannot be readily resold by Cardinal Health for any reason.
  • Any item purchased on a "special order" basis, including non-stock orders and drop shipments.
  • Any sterile or refrigerated merchandise, unless Cardinal Health is specially assured that such merchandise was properly stored and protected at all times and such merchandise is returned separately in a package marked as such and accompanied by a separate credit request form.
  • Any low stability product, including Epogen, Eminase, or other products which are unusually sensitive to temperature and handling conditions.
  • Any product not intended for return to a wholesaler in accordance with the return policies of the applicable manufacturer.

Returned Goods Procedure

• A fully completed Cardinal Credit Request Form must accompany all merchandise to be returned. Each form must include:
  • Customer name, address, and account number (as it appears on the invoice)
  • Name and address of Cardinal Health division to whom the return is made
  • "Ship to" address if different than "bill to" address
  • Cardinal Health invoice/order number and date
  • Product item number, quantity, form/size description, lot number, serial number, and expiration date (this information is on the packing slip)
  • Purchase order number, if applicable
  • Reason for the return
  • The date of the return
• Returned merchandise must be placed in a proper shipping container and, for merchandise valued at more than $250, signed for by the driver when the product is picked up.
• Upon approval of the return by Cardinal Health, the customer will be responsible to:
  • Promptly forward a copy of the credit memo and Return Form to the applicable manufacturer
  • Retain a coy of the credit memo and Return Form
  • Make such copies available to the manufacturer and to authorized federal, state, and local law enforcement officers upon request, all as required pursuant to FDA guidelines.

Miscellaneous

• Cardinal Health will indemnify and hold harmless TACHC and its shareholders, officers, agents, and representative from and against those claims, damages, or liabilities directly attributable to the failure of Cardinal Health to properly store, handle, or distribute merchandise in accordance with the agreement, it being understood, however, that Cardinal Health is not the manufacturer of the merchandise and that no indemnification of any type is being provided together than as specifically stated in this paragraph.
• Cardinal Health will obtain, pay for, and keep in full force and effect during their term of this agreement comprehensive general liability insurance in the amount of at least $1 million in aggregate, including but not limited to, coverage for contractual and product liability, personal and bodily injury, and broad-form property damage. Cardinal Health shall not cause or permit such insurance to be canceled or modified to materially reduce its scope or limits of coverage during the term of this agreement without giving prior notice of such cancellation or modification.