It seems that ”outcomes guarantees” with drugs are beginning to take hold in medical practice. Merck, in a deal with Cigna, agreed to charge for its diabetes drugs depending on how well patients fare. Procter & Gamble will apparently pay Health Alliance for treating bone fractures in patients who took Actonel for osteoporosis, and the drug failed to prevent the fracture.
These sorts of agreements have been used in some European countries, but pharmaceutical companies are likely to make such deals with only certain types of drugs. In the Merck example, the drugs chosen (Januvia and Janumet) are fairly effective, so most patients are likely to experience improved control, assuming they take their medicines regularly, something that the insurers will try diligently to enforce.
In the case of Actonel, the rate of fractures is low enough—and the competition is fierce and includes more effective drugs than Actonel (including generics)—that this deal looks like an excellent marketing move. We don’t know the details of the agreements (e.g., what kind of discount is Merck giving or what proportion of fracture cost is P&G going to cover), but this trend is likely to continue for selective drugs in highly competitive markets—the real effective ones and the less effective ones with low sales. Ineffective drugs that sell well will probably lose in the market place, which is exactly the way it should be. All in all, I view these as a win/win situation for the companies. Time will tell if they also turn out to be a good deal for the patients.
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