Amgen Harvard Deal

Amgen has struck a deal with Harvard Pilgrim Health Care, through which it could pay rebates if its new cholesterol drug Repatha does not perform as well as it did in clinical trials.

The deal is one of the first outcome-based agreements between drugmakers and health insurance companies in the U.S.

Despite many segments of the healthcare sector moving toward the pay-for-performance model, the pharmaceutical industry in the U.S. has consistently stuck to the “pay-for-pill” model, Michael Sherman, Harvard Pilgrim’s chief medical officer and senior vice president, says.

Sherman says the company adopted the agreement with the idea that drugs should be paid for based on the value they deliver. He adds that the pricing model would help manage increasing drug costs.

He declined to offer details on how outcomes will be monitored, other than that patients will be evaluated based on a six-month period of using the drug.

Such agreements have been more common in the UK, with the National Institute for Health and Care Excellence establishing cost- and risk-sharing deals with drug companies.

Harvard Pilgrim spokesperson Joan Fallon says that this is the first time the company has been able to negotiate a performance guarantee anywhere, although it has previously negotiated a discount arrangement with Gilead for its hepatitis C drug Sovaldi (sofosbuvir).

Known as a PCSK9 inhibitor, Repatha (evolocumab) is intended for patients with an inherited disorder resulting in high levels of LDL cholesterol or who have high-risk atherosclerotic cardiovascular disease conditions. It is administered via injection every two or four weeks.

source: “Amgen Strikes a Deal with Harvard Pilgrim.” Pharmaceutical Processing. N.p., 16 Nov. 2015. Web. 23 Feb. 2016.