Health Affairs April 3, 2020
As the prescription drug pipeline fills with very high-cost gene therapies and specialty drugs, affordability and access are top of mind for federal and state policy makers and patients. Drug manufacturers are aggressively promoting alternative purchasing arrangements as a better way for private insurers, state Medicaid programs, and employers to pay for new prescription drugs with very high launch prices. Some of these arrangements include pay-over-time contracts and outcomes-based contracts that have rebates linked to measurable clinical endpoints. These arrangements, when taken at face value, may seem to make high-cost drugs more affordable. However, they may do little or nothing to discourage excessive launch prices for new drugs and could instead merely facilitate them.
Nevertheless, drug manufacturers and some...
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