OBJECTIVES: With the introduction of new oncologics, biologics, combination therapies, and advanced therapy medicinal products, global payers are managing costs by entering into risk arrangements with pharmaceutical manufacturers. Payers are limiting their financial risk/spending by adopting outcomes-based contracts (OBC) that link patient outcomes to payment for drug therapy. This research explores current and future trends for OBC, by market, along with barriers to implementation.

METHODS: This study used primary and secondary research. Subjects included 52 payers from US, Canada, France, Germany, Italy, Spain, and UK. Payers were defined as individuals who influenced coverage and reimbursement decisions made by health authorities or insurers. A literature search on payer utilization management in each market was conducted to gain insight and inform primary research, which consisted of online surveys and telephone interviews. All data and information were tabulated and analyzed.

RESULTS: OBC is being used to various degrees by global payers to manage risk/drug spend. In the US, 20 of 40 payers plan to start or expand use of OBC for expensive oncologics and biologics. The rationale included extracting maximum value out of expensive products based on real-world efficacy. Limitations included lack of harmonization of data from multiple sources. Ex-US countries were divided between those that more regularly employ OBC (UK, Italy and Canada) to manage drug spending, and those countries in which OBC are not regularly employed (France, Germany and Spain). Reasons for limited use of OBC include strict patient data protection regulations, the overall administrative burden of implementation, and the challenge of collecting patient data at the hospital level.

CONCLUSIONS: As the prices of new advanced therapies continue to rise, payers in selected markets will adopt or expand the use of OBC to manage spending. Pharmaceutical manufacturers need to develop innovative OBC strategies in conjunction with their clinical development plans.