What is an EDI 845?
EDI 845, also known as a Price Authorization Acknowledgement/Status document, is an electronic data interchange transaction set used by vendors or manufacturers to communicate pricing updates to distributors or resellers. This document is commonly used in the pharmaceutical industry but can be used in any manufacturer-distributor relationship.
EDI 845 documents follow the x12 format set by the American National Standards Institute (ANSI), a not-for-profit organization that regulates EDI formats in the U.S. For EDIFACT users, the EDI 845 is equivalent to the ATHSTS message.
What are the Essential Components of EDI 845?
Manufacturers use EDI 845 to provide pricing updates to their distribution partners. The document includes several core pieces of information, including:
- Vendor number
- Vendor contact information
- Distributor contact information
- Contract information, such as contract number, eligible party
- Start and Expiry dates of contract
- Product identifiers, such as SKUs or UPCs
- Updated price information for each product or product set
How do I Use EDI 845?
EDI 845 transactions are usually sent from a vendor to a reseller. When a manufacturer changes the price of a product or set of products for a specific buyer type, they need to alert their distributors to help keep pricing accurate across the board. Manufacturers use EDI 845 to let distributors know about those updated contracts automatically, which allows the distributors to quickly update the prices in their own systems.
Generally, an EDI 845 is automatically sent after a contract has been agreed upon between the manufacturer and the end buyer or buying group. After receiving EDI 845, a distributor will send back an EDI 997 Functional Acknowledgement transaction to confirm that the document was accepted by the distributor’s EDI system.
What are the Benefits of EDI 845?
By using EDI 845, manufacturers are able to quickly alert trading partners to relevant contract changes that impact pricing. The automated nature of integrated EDI saves significant time for manufacturing employees, and helps prevent errors from manual input, which can result in pricing discrepancies. Accurate pricing is also key to reducing costly chargebacks and manual reconciliation processes which delay revenue recognition and negatively impact trading partner relationships.
Like other EDI documents, EDI 845 also offers a more secure option than emailing or faxing paper Price Authorization Acknowledgements. This is because many EDI providers use tactics such as security protocols, in-transit encryption, and user authentication to protect data from being viewed or altered by unknown users. The best of these providers use security methods that meet SOC compliance standards.