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N773 Remark Code: Drug Not From Specialty Vendor

N773 means the drug billed was not obtained from the specialty vendor the payer requires. The payer covers this drug only when it is sourced through its designated specialty pharmacy or vendor, so it did not pay for the provider-purchased supply.

Quick facts

Code
N773 (RARC N773)
Status
Active In use since July 1, 2016.
Code set
Remittance Advice Remark Codes (RARC)
Group codes
  • CO (Contractual Obligation): The provider absorbs the denial, usually because the payer's sourcing rule was not followed. Patients generally should not be billed.
Official description
Drug supplied not obtained from specialty vendor.
X12 Remittance Advice Remark Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What N773 means

For many specialty drugs, payers control how the drug is acquired. Instead of the provider buying the drug and billing for it, often called buy-and-bill, the payer may require a designated specialty pharmacy to dispense it. The provider then administers the drug and bills only for the administration.

N773 means the payer found that the drug on your claim was not obtained through its specialty vendor. It usually appears with CARC 96 or CARC 272.

Common causes

  • The practice bought the drug from its usual wholesaler out of habit.
  • The payer’s specialty vendor requirement took effect after the patient’s treatment began.
  • The patient’s plan changed, bringing a new sourcing rule.
  • The prior authorization approved the drug but specified the vendor, and that detail was missed.

How to fix it

  1. Confirm the payer’s sourcing requirement for the drug and date of service.
  2. If the drug actually came from the specialty vendor, provide proof, such as a dispensing record, and request reprocessing.
  3. Check whether your drug billing line should have been billed at all when the vendor supplies the drug. Correct the claim if needed.
  4. If there was an urgent clinical reason for using your own supply, ask the payer about an exception or appeal.
  5. For future doses, order through the required vendor.

How to prevent it

Review the authorization for each specialty drug to see whether a vendor is specified, and flag patients whose plans use specialty sourcing. The authorization and referral guide covers building those checks into scheduling.

Codes that may appear with N773

  • CO-96 (Non-covered charge(s).): The charge is non-covered as billed, explained by the sourcing requirement.
  • CO-272 (Coverage/program guidelines were not met.): Coverage or program guidelines for drug acquisition were not met.
  • CO-242 (Services not provided by network/primary care providers.): Services were not provided by a network provider, when the specialty vendor is a network requirement.
  • N348 (You chose that this service/supply/drug would be rendered/supplied and billed by a different practitioner/supplier.): The service or drug was to be supplied and billed by a different practitioner or supplier.
  • M119 (Missing/incomplete/invalid/ deactivated/withdrawn National Drug Code (NDC).): The National Drug Code is missing or invalid, a separate billing problem.
  • N751 (Adjusted because the patient is covered under a Medicare Part D plan.): The drug should be billed to the patient's Medicare Part D plan.

N773 FAQ

What is a specialty vendor requirement?

Some payers require that certain high-cost drugs be dispensed by a designated specialty pharmacy, which then ships the drug to the provider for administration. The provider bills only for administering it.

Can I still bill for administering the drug?

Often yes. N773 usually affects the drug line itself. Check how the administration line processed.

Can I appeal N773?

If there was a clinical reason the specialty vendor could not supply the drug in time, or the payer's rule did not apply, you can ask about an exception or appeal. Otherwise the denial is likely to stand.