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DocuSign Envelope ID: 5332467E-CBEF-4C5D-8BOE-61 E380BDA11 B <br />DocuSign Envelope ID: 151 ECOCF-B55C-414F-9455-72004347A310 <br />( 112023 Version) <br />■ Mail Order: Lower of (i) Plan copayments/coinsurance or (ii) discounted AWP (including MAC price, <br />when MAC pricing is applicable). <br />• If no adjudication rates are specified herein, each Prescription Drug Claim will be adjudicated to Client <br />at the applicable ingredient cost and will be reconciled to the applicable guarantee as set forth herein. <br />The discounted ingredient cost will be the lesser of MAC (as applicable), U&C or the applicable AWP <br />discount. Prescription Drug Claims dispensed at ESI Mail Pharmacy will be adjudicated to Client at the <br />applicable ingredient cost and will be reconciled to the applicable guarantee as set forth herein. <br />3.1 Pricing. <br />(a) Ingredient Cost. Administrator will offer an average aggregate annual discount as reflected below <br />on Client utilization to be calculated as follows. The pricing below will be implemented as of the <br />Addendum Effective Date. The pricing below will be guaranteed upon the start of Client's Renewal <br />Term (as described in the Agreement) that begins on or after the Addendum Effective Date. <br />[]-(total discounted AWP ingredient cost excluding dispensing fees and ancillary <br />charges, and prior to application of Copayments) of applicable Prescription Drug <br />Claims for the annual period divided by total undiscounted AWP ingredient cost (both <br />amounts will be calculated as of the date of adjudication) for the annual period)]. <br />Discounted ingredient cost will be the lesser of MAC (as applicable), U&C or AWP <br />discount. <br />Notwithstanding anything herein to the contrary: (i) a Prescription Drug Claim that <br />processes at the Brand Drug rates (Participating Pharmacy Reimbursement Rates) and <br />(Mail Pharmacy Reimbursement Rates), as indicated on the ingredient cost field of tile <br />Prescription Drug Claim's data record, shall be reconciled as part of the Brand Drug <br />guarantee below, and (ii) a Prescription Drug Claim that processes at the Generic Drug <br />rates (Participating Pharmacy Reimbursement Rates) and (Mail Pharmacy <br />Reimbursement Rates) above, as indicated on the ingredient cost field of the <br />Prescription Drug Claim's data record, shall be reconciled as part of the Generic Drug <br />guarantee below. The Prescription Drug Claims that may be excluded from the <br />reconciliation of the pricing guarantees are as identified in the "Prescription Drug <br />Claims Excluded" paragraphs below in addition to Prescription Drug Claims <br />dispensed in Puerto Rico, Guam, Northern Mariana Islands, Virgin Islands, Hawaii, <br />Massachusetts, Alaska, West Virginia, and rural pharmacies. Furthermore, prices may <br />vary in certain states for reasons such as most favored nations laws, other state or local <br />legal requirements, geographic location, or other factors beyond the control of <br />Administrator. In those situations, some Claims may be exempt from reconciliation <br />of the financial guarantees set forth herein. All Claims may be aggregated for purposes <br />of such rates. Claims dispensed in states subject to NADAC or another pricing <br />benchmark required by law for pharmacy reimbursement may be excluded from <br />dispensing fee guarantees only. Additionally, under any retail pricing arrangement(s) <br />subject to NADAC pricing, Administrator will retrospectively invoice Client for the <br />difference between Client's contracted dispensing fee and any state mandated <br />pharmacy dispensing fee resulting from claims incurred in any state that mandates the <br />use of NADAC or another pricing benchmarks in pharmacy reimbursement. <br />NOT FOR DISTRIBUTION. THE INFORMATION CONTAINED HEREIN IS CONFIDENTIAL, PROPRIETARY <br />AND CONSTITUTES TRADE SECRETS OF ESI AND RXBENEFITS <br />