From discussion to implementation - How to negotiate and implement a risk-sharing agreement

Sep 16, 2026

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Value-based drug pricing interest pushes manufacturers to quantify therapy value through outcomes-based, risk-sharing agreements. Stakeholders remain cautious about implementation as complex terms and limited resources hinder execution. Separate discussions with payers and manufacturers highlight themes: build trust via transparency, align on measurable endpoints without excessive data burden, and negotiate OBCs with clear, category-specific objectives. Collaboration helps reduce risk conflict and supports improved patient outcomes.

LanguageEnglish

CategoryGeneral

FormatPDF

Pages6

Reading Time2 min

AccessFree to download

Background

Establishing trust through transparency

Not all categories are created equal

Measurable metrics and impactful endpoints

Recommended approach to defining metrics

July 2017 From discussion to implementation: How to negotiate and implement a risk-sharing agreement At the table with payers and manufacturers Background The groundswell of interest in value-based drug pricing models has forced manufacturers to focus on finding ways to measure the value of a therapy. Outcomes-based, risk-sharing agreements are an option for manufacturers seeking to mitigate additional price regulation and access restrictions proposed by payers, politicians, and other stakeholders. When it comes to implementation, nearly all stakeholders continue to be somewhat skeptical of outcomes-based contracts (OBCs) . Complex contract terms and resource constraints continue tobe obstacles. Consultants with Charles River Associates (CRA) solicited ideas and opinions of payers and drug manufacturers through separate live discussions to gain a deeper understanding of how to overcome roadblocks to OBCs. Four core themes emerged: 􀁸 Greater trust needs to be fostered between payers and manufactures; 􀁸 The ability to monitor relevant endpoints and metrics matter; 􀁸 Negotiating OBCs is time consuming and resource intensive; and 􀁸 These agreements make the most sense when the therapeutic area is changing or not well understood. In this article, we share the ideas we heard, examine the obstacles, and provide examples of how payers and manufacturers can collaborate to share risk and improve patient outcomes. Are outcomes-based contracts the flavor of the month? Establishing trust through transparency Payers suggested that manufacturers’ account representatives often come across as disingenuous when presenting OBCs: “Account representatives appear to feel pressured to present these types of contracts as more of a ‘check-the-box’ exercise, just because it is ‘the new hot topic’.” “Often times it seems like the account managers are bringing forward something that the corporate office came up with just to push this idea.” Transparency and trust are the foundation of a successful OBC. When both parties openly share detailed goals for an agreement and act accordingly, coming to a win-win compromise becomes more of a team effort, limiting the potential for “gamesmanship.” Even when payers believe manufacturers are genuinely interested in an OBC, payers note a reluctance in sharing the risk. “We get the sense that there is a lot of talk from pharma companies, but when we get to the details and want to finalize these contracts, they see themselves as assuming too much of the risk which may cause them to lose money, so they start adding excessive details to the terms, which make the payer back away.” Manufacturers acknowledge these concerns, and are wary of being outmaneuvered by insurers they view as better equipped to understand and manage risk. “Payers are not interested in sharing risk, only shifting it to manufacturers.” Contract negotiations with clear objectives, targeted for specific product and customer circumstances, are essential as is the reality that both parties have to be open to compromise. If contract goals are non-specific and/or avoiding any potential for downside risk, initial conversations may be cut short, or impasses may arise later on, wasting time and resources. Not all categories are created equal. Measurable metrics and impactful endpoints Once payers and manufacturers understand each other’s goals, negotiating contract terms can still bring challenges. The metrics used to assess patient endpoints should not be so onerous that the cost to collect data outweighs the upside of a contract. Agreement on relevant, measurable, and impactful metrics is essential to a successful OBC and some categories present larger challenges due to the difficulty in determining objective metrics. Payers suggested that a productive way to develop OBC metrics is to look at primary outcomesin pivotal studies. Some payers agreed that secondary outcomes and other Phase III studies limit a manufactu

FAQs

Why are outcomes-based risk-sharing agreements important for manufacturers and payers?

They offer a way to measure therapy value while helping manufacturers mitigate additional price regulation and access restrictions proposed by payers and other stakeholders.

What are the main obstacles to implementing outcomes-based contracts?

Skepticism about complex contract terms, resource constraints, difficulty in finalizing risk arrangements, and challenges in selecting measurable endpoints that do not outweigh data collection costs.

How should parties develop and select metrics for an OBC?

Use relevant, measurable endpoints derived from pivotal clinical trial outcomes as a starting point, ensure the patient population and endpoints are not skewed, and agree on the time and resources needed to collect outcomes data.

Sep 16, 2026

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