CMS has received questions from manufacturers regarding whether price concessions and services offered to payers within Value-Based Purchasing (VBP) arrangements in the pharmaceutical marketplace could impact their drug’s Medicaid best price and increase their Medicaid rebate obligations. In recent guidance, CMS notes that, in general, prices included in best price include all prices, including applicable discounts, rebates, or other transactions that adjust prices either directly or indirectly to best price eligible entities, including providers. However, CMS has concluded that the impact of a VBP arrangement on a manufacturer’s best price will differ depending on the arrangement’s structure; CMS has offered to consult with manufacturers about specific arrangements. Additionally, CMS encourages states to consider negotiating supplemental rebates as part of VBP arrangements, and notes that to the extent that a VBP arrangement provides supplemental rebates pursuant to a CMS-approved supplemental rebate agreement with the state Medicaid agency, the rebates would be excluded from best price. CMS also urges states to consider negotiating supplemental rebates with manufacturers for some or all of their Medicaid managed care drug claims, although CMS reminds states to determine the impact of such a decision on their contracts with managed care organizations.