Health Insurers Push to Tie Drug Prices to Outcomes

via Wall Street Journal

Health insurer Cigna Corp. will get extra price discounts from drugmakers if new cholesterol medications don’t help patients as much as expected, a significant step in a broader push to tie the cost of drugs to how well they work.

Such “value-based” deals are becoming more common as rising costs spur customers to demand assurances they are getting what they pay for. U.S. prescription spending rose 12% to nearly $425 billion in 2015, following a 13% increase in 2014, according to research firm IMS Health.

Cigna announced on Wednesday that it is the first insurer to reach value-based contracts for an entire new class of cholesterol drugs: Praluent, which is co-marketed by Sanofi SA and Regeneron Pharmaceuticals Inc., and Amgen Inc.’s Repatha are the only two cholesterol-lowering drugs known as PCSK9 inhibitors currently on the U.S. market.

Read the full article here

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About thebenefitblog

Eric is a Producer at Lockton Insurance Brokers, Inc., the world’s largest privately held commercial broker. Eric has over 23 years of experience in the insurance industry and has spent the last 11 years with Lockton. Eric specializes in Health & Welfare Benefits, Retirement Planning, and Executive Benefits. Eric's clients utilize his expertise in the areas of Plan Due Diligence, Transaction Structure, Fiduciary Oversight, Investment Design, Compliance and Vendor negotiation to improve the operational & financial outcome for each client. The Benefit Blog is a place to share that expertise and industry news.
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