If you have ever tried to find out what a prescription drug actually costs — not the retail price, not the insurance copay, but the real underlying acquisition cost — you have probably encountered NADAC. It is the most authoritative public source of drug pricing data in the United States, published weekly by the federal government. Here is everything patients and researchers need to know.
NADAC: The Definition
NADAC stands for National Average Drug Acquisition Cost. It is a weekly survey conducted by the Centers for Medicare & Medicaid Services (CMS) that measures the average price retail community pharmacies across the United States pay to purchase drugs from manufacturers, distributors, or wholesalers.
In the most direct terms: NADAC tells you what your pharmacy paid for the drug before they dispensed it to you.
Who Publishes NADAC and Why
CMS publishes NADAC as a free public dataset at data.medicaid.gov. The program was created to help state Medicaid programs set accurate reimbursement rates for pharmacies dispensing drugs to Medicaid beneficiaries.
Before NADAC, Medicaid reimbursement was based on Average Wholesale Price (AWP) — a number that was notoriously disconnected from actual market prices and subject to manipulation. NADAC replaced AWP-based reimbursement with a survey-based system grounded in what pharmacies actually pay.
How NADAC Is Calculated
CMS contracts with a survey vendor that contacts a random sample of retail community pharmacies each week. Pharmacies report their actual invoice prices for drugs purchased during a specified period. The survey vendor aggregates these prices into a national average per unit (per tablet, per milliliter, per gram, etc.).
The resulting NADAC is published weekly and covers most drugs dispensed in US retail pharmacies. Each entry includes:
- Drug name and NDC (National Drug Code)
- Per-unit NADAC price
- Brand (B) or generic (G) classification
- Survey date
- Number of survey respondents
NADAC vs Other Drug Price Benchmarks
There are several drug pricing benchmarks in the US healthcare system — understanding the differences matters:
AWP (Average Wholesale Price) — The manufacturer's suggested wholesale price. Historically inflated and no longer used for Medicaid reimbursement. Still used in some commercial insurance contracts.
WAC (Wholesale Acquisition Cost) — The manufacturer's list price to wholesalers before discounts or rebates. Higher than what pharmacies actually pay.
NADAC — What pharmacies actually pay after discounts (but before manufacturer rebates back to payers). The most accurate public measure of acquisition cost.
AMP (Average Manufacturer Price) — What manufacturers receive on average from wholesalers after discounts. Used for calculating Medicaid rebates. Not publicly reported at the drug level.
ASP (Average Sales Price) — Used for Part B Medicare drug reimbursement. Based on manufacturer sales data reported quarterly.
NADAC sits between WAC and cash retail price — it is what the pharmacy actually paid, making it the most useful benchmark for estimating the real cost impact of a tariff.
Medicaid Drug Pricing: How NADAC Is Used
Medicaid drug reimbursement works as follows:
1. States reimburse pharmacies for drugs dispensed to Medicaid patients at rates tied to NADAC (typically NADAC + a dispensing fee)
2. Manufacturers pay rebates to states based on the drug's AMP and statutory rebate percentages
3. Net drug cost = Reimbursement minus rebate
When a tariff causes a manufacturer to raise their prices (increasing NADAC), Medicaid reimbursements increase — but so do the required manufacturer rebates. The net cost impact on Medicaid is partially buffered by this rebate mechanism, though not fully.
Government Drug Pricing in 2026: NADAC + Tariff
The 2026 pharmaceutical tariff hits at the import level — the cost of bringing drugs or active pharmaceutical ingredients into the US. This cost flows into what manufacturers charge, which flows into NADAC.
For drugs subject to the 100% default tariff, acquisition costs could rise significantly — and NADAC would reflect that increase within weeks of the tariff taking effect. RxTariff pulls live NADAC data to show you the current baseline price for any drug you search.
Use the drug search tool to see the current NADAC price for your medication alongside its 2026 tariff status. The methodology page explains exactly how this data is sourced and calculated.