Performance-Based Drug Contracts: A Good Fit for Pharma and Health Insurers?

[This article posted on April 24, 2009. It is posted within the following categories: Pharma & Devices, via Michael Douglas, MD, MBA.]

It’s a marriage of self interests among Pharma and Big Insurance. Merck and Cigna just announced a partnership which involves the applications of drug discounts from the pharma company as a benefit to the healthcare payer if patients “perform” well on those covered drugs.

What are those drugs? Two key players in the next generation of agents Merck is positioning for heavy market growth and consumer use — Januvia and Janumet, both of which contain the main chemical ingredient, sitagliptin. Merck is not requiring that those drugs be solely repsonsible for good diabetes control in patients on other anti-diabetic drugs, of course; but the designation of Januvia and Janumet as “perferred agents” in the Cigna formulary makes this sort of surveillance a little easier — which is why the insurer is in talks with three other drug classes. | LINK

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