Enabling and Supporting Efficacy-Linked Pricing Contracts
Improvements in care benefit patients but make it harder to demonstrate survival gains in clinical trials. To avoid unacceptable delays, trialists have turned to surrogate endpoints. Some payors and clinicians remain skeptical about surrogate endpoints in oncology, cardiovascular disease, and other salient areas. Efficacy-linked pricing – e.g., a “money-back guarantee” – can bridge the negotiating gap between payers and manufacturers, although this form of pricing remains nascent. Our panelists will discuss: 1. How efficacy-linked pricing can facilitate better access and outcomes; 2. Current obstacles to efficacy-linked pricing, including challenges for Medicaid best-price rules, for revenue recognition, and for predicting likely real-world outcomes; and 3. New strategies for overcoming these obstacles by leveraging recently developed analytic techniques for predicting real-world outcomes for novel drugs and shifting the revenue risk from biopharma to the investor ecosystem.