Whilst we recognise that many access negotiations take place at a regional or local level, this article focuses on the national level and engagement with national payers.
Most pharma and biotech companies seem keen to embrace VBC and other forms of innovative contracting. Some have developed global frameworks to drive VBCs for their products. However, this enthusiasm is not always shared by payers. In general, payers seem to prefer simple discounts to more complex risk-sharing schemes or VBCs.
COMPANIES NEED TO BE CLOSE TO PAYERS TO UNDERSTAND WHAT THEY NEED AND THEIR APPETITE TO ENTER INTO A COMPLEX AGREEMENT. EVERY INTERACTION WITH PAYERS IS IMPORTANT.
There is an increasing openness from payers to consider VBCs in exceptional circumstances. Because of this, there is a risk that pharma and biotech companies will push for complex VBCs even when there is no appetite for them from payers, and no need for a VBC to ensure a successful commercial launch.
Agreeing a VBC can be an expensive and time-consuming process for all parties. Implementing them is likely to increase the clinical and administrative burden of healthcare providers and place additional demands on company resources. As such, they are not always needed to ensure reimbursed patient access. The effort required to agree and implement a VBC should only be undertaken when there is a clear patient need and a good chance of success. Understanding when a product may be a suitable candidate for a VBC is important and will enable market access teams to focus their energies on those agreements that will be most likely to succeed and most likely to have a significant impact.
A structured approach to assessing the likely barriers to access and the readiness of markets to consider VBCs (alongside the alternatives to VBCs that they may prefer) is an important early step in preparing for product launch. A clear framework to identify when a VBC is appropriate for different treatments in different markets will help companies engage with payers and ensure they focus on the most effective access strategies in each market.
Companies need to be close to payers to understand what they need and their appetite to enter into a complex agreement. Every interaction with payers is important. Companies should seek advice as early as possible and maintain an ongoing dialogue. Negotiations are a process that can take many years, with multiple company representatives engaging with payers. It is worth remembering that every interaction is part of the negotiation: every HTA submission, every payer interaction, and every conference discussion.
Alongside this early engagement, companies should be making a critical assessment of their product, the evidence they have, the need for a VBC and the demand coming from payers to enter into a complex contract. Hanover has developed a clear access framework to support companies in undertaking this process. The framework takes companies through a series of steps, covering an initial assessment to determine whether there is a need for a VBC, and whether the asset in question is suitable for such a contract. It lays the groundwork to consider the product at an archetype level, and then examine individual markets in more detail, helping companies drive towards a commercially successful launch for their product.
Different companies are working on their own frameworks to develop VBCs. Some are determined to have VBCs as a default position. Our view is that this is not necessary in many cases, and payers are not supportive of the widespread use of VBCs. If a product is close to launch, it is vital to assess whether a VBC is appropriate before investing time and money into this type of negotiation. Only then can companies be sure that they have the right asset in the right place for the right contract.