Outcomes-Based Contracting Experience: Research Findings from U.S. and European Stakeholders

Outcomes-based contracts (OBCs), a type of risk-sharing arrangement (RSA), have emerged as a promising avenue for payers to engage with pharmaceutical manufacturers to share risk and improve patient access to medicines via evaluation of real-world outcomes.

To assess the level of recent OBC activity and stakeholder perceptions of these arrangements, as well as the outlook for future OBC activity from a payer and manufacturer perspective in the United States and EU-5 (France, Germany, Italy, Spain, and the United Kingdom).

Using a structured questionnaire, interviews were conducted with 27 experts, including 14 U.S. payers, 5 EU-5 national payers, and 8 manufacturer pricing/market access executives (4 U.S., 4 EU-5). We also used the University of Washington's Performance Based Risk-Sharing (PBRS) database and other targeted publicly available information.

Publicly disclosed information on OBCs understates the level of OBC activity, since many arrangements are confidential. Overall, U.S. and EU-5 interviewees generally expected that 2 to 3 times more OBCs would be implemented in the next 5 years than in the previous 5 years. Key drivers included the introduction of a national OBC framework in Spain, potentially a similar framework in the United Kingdom, a growing sickness fund activity in Germany, and a U.S. movement towards accountable care. Motivation for OBCs varied markedly across markets and stakeholders, with operational feasibility noted as a significant hurdle in the United States and France. Along with improving health outcomes, cost and financial risk reduction were the primary OBC motivators for payers, while potential access or reimbursement gains were key factors for manufacturers.

Using direct input from U.S. and EU-5 payer and pharmaceutical manufacturer decision makers, this research suggests that high OBC growth is expected in the EU-5 and, to a more moderate extent, in the United States, particularly if clear, simpler OBC frameworks can be developed.

This study was funded by Novartis Pharmaceuticals. Novartis employees were involved in all aspects of this study. Vegesna and Sasane are employed by and own stock in Novartis. Nazareth and Ko were employees of Novartis at the time of this study. Frois, Demean, Carpenter, and Wu are or have been employed by Analysis Group, which received a grant from Novartis for this research. Navarro received consulting fees from Novartis for his involvement in this research. Study concept and design were contributed by Sasane, Frois, Nazareth, and Wu. Navarro, Demean, and Frois took the lead in data collection, assisted by Carpenter, Ko, and Nazareth. Data interpretation was provided by Frois, Carpenter, Nazareth, and Ko, along with Sasane, Demean, Wu, and Navarro. The manuscript was written by Frois, Demean, Nazareth, and Ko, along with Sasane, Carpenter, Wu, and Navarro, and revised by Frois, Ko, and Vegesna, along with Sasane, Nazareth, Wu, and Navarro.