Private Sector Risk-Sharing Agreements in the United States: Trends, Barriers, and Prospects

Assessment of current trends, success factors, and challenges in the use of risk-sharing agreements in the US private sector.


Objectives: Risk-sharing agreements (RSAs) between drug manufacturers and payers link coverage and reimbursement to real-world performance or utilization of medical products. These arrangements have garnered considerable attention in recent years. However, greater use outside the United States raises questions as to why their use has been limited in the US private sector, and whether their use might increase in the evolving US healthcare system.

Study Design: To understand current trends, success factors, and challenges in the use of RSAs, we conducted a review of RSAs, interviews, and a survey to understand key stakeholders’ experiences and expectations for RSAs in the US private sector.

Methods: Trends in the numbers of RSAs were assessed using a database of RSAs. We also conducted in-depth interviews with stakeholders from pharmaceutical companies, payer organizations, and industry experts in the United States and European Union. In addition, we administered an online survey with a broader audience to identify perceptions of the future of RSAs in the United States.

Results: Most manufacturers and payers expressed interest in RSAs and see potential value in their use. Due to numerous barriers associated with outcomes-based agreements, stakeholders were more optimistic about financial-based RSAs. In the US private sector, however, there remains considerable interest—improved data systems and shifting incentives (via health reform and accountable care organizations) may generate more action.

Conclusions: In the US commercial payer markets, there is continued interest among some manufacturers and payers in outcomes-based RSAs. Despite continued discussion and activity, the number of new agreements is still small.

Am J Manag Care. 2015;21(9):632-640

Take-Away Points

This research assessed whether risk-sharing agreements between US commercial payers and pharmaceutical companies may become of greater interest with improved data systems and shifting incentives (via health reform and accountable care organizations). Key findings:

  • While such agreements offer numerous advantages to payers, pharmaceutical companies, patients, and society, their growth remains stagnant in the United States, due in large part to the additional effort required to implement and adjudicate risk-sharing agreements as compared to traditional rebates.
  • In the US private sector, however, there remains considerable interest: improved data systems and shifting incentives may generate more action.

Risk-sharing agreements (RSAs) between drug manufacturers and payers—also called performance-based risk-sharing arrangements (PBRSAs), managed entry agreements, patient access schemes, and coverage with evidence development (CED), among other terms—link coverage and reimbursement levels to real-world performance or utilization of medical products.1 These arrangements have garnered considerable attention in recent years: a recent analysis of the University of Washington Performance-Based Risk-Sharing (PBRS) Database,2 including 148 arrangements over the last 2 decades, concluded that although the overall pace of adoption seems to be slowing, several new countries have begun to implement RSAs.3 In the United States, the largest number of arrangements has been in the Medicare program; the uptake of private sector RSAs seems stagnant despite growing interest in the general principle of “paying for performance.” The aim of this study was to assess the state of and prospects for private sector RSAs in the United States, considering by comparison experiences from other countries, most commonly involving public payers.

RSAs offer a number of potential advantages,1,4-8 including: 1) reducing the risk to payers of making a suboptimal purchase; 2) providing earlier access to medications for patients; 3) creating international pricing efficiency, especially in a world with external reference pricing and parallel trade; and 4) generating evidence on what works in the real world. These potential advantages, coupled with the higher volume of use outside the United States, raise questions as to why they have seen limited use in the United States,9,10 as well as what arrangements might gain traction with the new emphasis on accountable care organizations (ACOs), which operate under stronger incentives to manage patient care efficiently.

Previous work in this area has characterized the types of RSAs, trends in their adoption, economic incentives and rationale, and the drivers and barriers for adoption, but has not focused on current thinking in the US private sector. A broad distinction has been made between “outcomes-based” RSAs and “financial-based” RSAs. For the former, the manufacturer provides or agrees to rebates, refunds, or price adjustments if their product fails to meet agreed-upon clinical outcome targets. For the latter, reimbursement is tied to financial measures (eg, total sales) or to utilization. Here, we focus on the US private sector marketplace and particularly on the level of interest in outcomes-based agreements; specifically, we sought to understand the barriers to and drivers of developing private sector RSAs in the United States. We also explored whether the current situation reflects a broader demand by regulators and payers for greater real-world data and comparative evidence.


To assess the validity of the general perception of the lack of uptake of RSAs in the United States, we conducted a review of the University of Washington’s PBRS Database to assess the number of US agreements and trends in the number of agreements over time. For comparison, we also examined the number of agreements for the rest of the world. At the time of the study, the database included information on RSAs initiated from January 1993 to December 2013, with information on the parties participating in the arrangement, the type of arrangement, and details of the arrangement and/or outcomes, as available.

eAppendix A

To understand current trends, success factors, and challenges in the use of RSAs, we conducted key informant interviews and an online survey to understand key stakeholders’ experiences with RSAs both inside and outside the United States as well as lessons for the US private sector situation. We used purposive sampling to identify 16 key stakeholders from pharmaceutical companies, payer organizations, and industry experts in the United States and European Union. We developed the interview guide and survey based on previous work in the area1,2 and through iterative review and revision by a group of content experts. The key informant interviews consisted of in-depth, 1-hour telephone interviews conducted between October 2013 and May 2014. Interview topics included: experience with RSAs, motivating factors, administrative considerations, effectiveness of agreements, and potential for use in the future (, available at To identify themes from the interviews, we assessed the number of interviewees who stated or generally agreed with key statements across all interviews.

eAppendix B

The survey was administered via the Web in May 2014, and consisted of 8 questions that asked respondents about their expectations for the future of RSAs in the United States and to identify and rank key barriers to their use (). We identified themes by assessing the number of respondents who provided similar answers to the surveys. We invited a convenience sample of 37 individuals to complete the survey. Given the small sample size, we summarized responses using descriptive statistics.


Our review of the PBRS Database identified 148 RSAs worldwide from the late 1990s and 2013. Only 18 of the 148 total arrangements in the University of Washington Database, or 12.2%, represent US RSAs: 11 of these were public sector coverage with evidence development schemes, while only 7 were private sector RSAs. A review of the number of agreements annually suggests a little growth in the number of agreements in the United States. To date, RSAs have been more frequently employed in single-payer systems across Europe, Canada, and Australia.

Of the 16 individuals targeted for our key stakeholder interviews, we were able to schedule and conduct interviews with 14 (87.5%). The 14 in-depth interviews included 9 interviews with US stakeholders and 5 interviews with EU stakeholders. Of these, 7 were from pharmaceutical companies, 5 were currently or previously employed by payer/government organizations, and 2 were subject matter experts. We received 15 responses to our survey (response rate of 40.5%), including 10 responses from individuals from pharmaceutical companies, 3 from payers/pharmacy benefit managers, and 2 from other nonprofits and consultancies. The majority of respondents (93.3%) were from the United States.

Figures 1



In general, our interviews suggest that while there is interest in RSAs, there has been limited use in the United States due to difficulties in implementing and carrying out such agreements. The majority of interviewees (12 of 14) were cautiously to mildly optimistic about the future potential for outcomes-based RSAs to be adopted in the United States. To illustrate the basis of this position, selected comments and quotations from interviews are shown in , , and , and are organized to represent comments ranging from more optimistic, to cautious, to more pessimistic. Roughly half of manufacturers and payers expressed interest in outcomes-based RSAs and see value in their use; almost all were optimistic about the use of financial-based RSAs. In general, due to the difficulty in implementing and executing outcomes-based RSAs, interviewees indicated an interest in more financial-based RSAs (eg, utilization or financial capitation) but less interest in clinical and health outcomes-based RSAs.

Outcomes-based agreements, while attractive to some, were perceived by interviewees to be difficult to execute and as having high transaction costs. Interview respondents were skeptical about being able to use outcomes-based RSAs, citing challenges in implementing and executing outcomes-based RSAs that would mitigate their potential in the United States, particularly given the fragmented payer system with patient movement across plans, as well as the current lack of data infrastructure that limits feasibility and, to some extent, interest in measuring long-term outcomes. Interview respondents indicated that simpler, financial-based agreements, on the other hand, have had demonstrated success. The survey responses corroborated the general support for financial-based RSAs seen in the interviews: 80% of respondents stated that the use of financial-based RSAs in the United States would grow.

Reasons to Use RSAs

The interviews suggest that the perceived value of an RSA versus a traditional discount mechanism depends on the product, disease area, and availability of the necessary data infrastructure. The manufacturers we interviewed stated that they would use RSAs as a way to differentiate and demonstrate the effectiveness of their product versus competitors. RSAs are typically not used in a US setting when a product is first to market or the market leader, but are more attractive to manufacturers when there is competition. The manufacturer seeks to secure beneficial formulary placement or gain market share. They can also be a mechanism to increase patient compliance.

Based on our interviews, US payers leverage—or would like to leverage—RSAs as a way to reduce uncertainty about a product’s clinical value, performance, or budget impact, as they allow payers and patients to gain experience with the medication. As payers and regulators are often interested in different types of data, at the time of launch, a product’s impact on costs and comparative effectiveness is often not well understood. Ultimately, payers expressed interest in RSAs as they allow payers to ensure that the price of a drug is more closely aligned to its value. During our interviews, payers indicated interest in RSAs for products that are more costly (eg, specialty drugs, biologics, combination products) and for disease areas for which cost consequences are substantial. Payers are not interested in engaging in RSAs for undifferentiated products where there is no real or perceived advantage.

Barriers to Using RSAs

Figure 4

lists potential barriers to implementing RSAs that were identified during the interviews. The implementation and execution of RSAs is perceived to present a significant administrative burden that requires a substantial time investment. Further, outcomes-based agreements require significant payer and provider infrastructure: if payers lack the databases required to track individual patients, outcomes-based RSAs are difficult. Additional challenges that were mentioned include a) the need for adequately trained staff, b) the risk to pharmaceutical companies associated with being responsible for outcomes when they cannot control the way a drug is prescribed or used, c) the management of consequences in terms of changing preferred drugs and denying coverage for drugs, and d) the identification of outcomes that are meaningful but measurable within a reasonable time frame.

Figure 5

We tested the barriers identified during the interviews with a broader audience in the survey by asking respondents to rate and rank from the list of barriers provided in Figure 4 and any additional barriers not listed. The interview themes were consistent with the top barriers identified in the survey (). The significant additional effort associated with RSAs was selected as the number 1 barrier to the use of RSAs in the United States by 33% of respondents and as the number 2 barrier by 27% of respondents. Inadequate data infrastructure was cited as the number 1 barrier by 27% of respondents and as the number 2 barrier by 33% of respondents. Other barriers that were selected as one of the top 3 hindrances to conducting RSAs in the United States included: federal (Medicaid) best price (40% ranked this as one of the top 3 barriers), significant resources/costs of adjudication (40%), challenges in measuring relevant outcomes (27%), and difficulty in reaching contractual agreement (27%).

Logistical Considerations

While not necessarily barriers, there were several logistical challenges highlighted during our interviews that may be a consideration for both payers and pharmaceutical companies when evaluating opportunities for RSAs. The number of agreements in place with a given payer or for a given class of drugs is a key consideration. While payers expressed interest in having multiple agreements for competing products, pharmaceutical manufacturers indicated this becomes a complex arrangement that they are reluctant to enter. Further, only large payers are likely to have the capability for multiple, simultaneous agreements, given the burden of negotiation, data collection, monitoring, and adjudication of RSAs. Another key consideration is duration, as payers and manufacturers agree that short-term deals are not desirable given the considerable investment in evidence development. On the other hand, they state that long-term deals are also not desirable given the costs and risks involved. Both parties acknowledge that medium-term deals (18-36 months) are the right balance trading off the sizable up-front investment and a preference to execute agreements reasonably fast.

What Works

Access to clinical data was stated as a key barrier to the use of RSAs; scenarios where clinical data are more readily available make RSAs more feasible. For instance, interviewees indicated it may be easier to measure health outcomes for drugs that are administered in settings where there are more immediate clinical data available (eg, the hospital setting), where drugs are administered in person, or when data are already being collected as part of ongoing processes (eg, performance measurement via the Healthcare Effectiveness Data and Information Set). Complex outcomes might be more easily measured where there is an active provider (eg, patient-centered medical homes). Similarly, interviewees stated outcomes-based RSAs can be most successful where the infrastructure is robust to collect such data, such as in single payer or closed settings including integrated delivery networks. Drug cost as a share of total episode cost can also be a factor.

A key success factor is the need for manufacturers to understand the amount of risk they are undertaking when entering into an RSA. Manufacturers feel they should be able to reasonably predict plausible outcomes of the agreement and assess the level of risk; for example, what level of compliance is required and to what extent the clinical trial population differs from the real-world population.

What Doesn’t Work

There are a few scenarios that are considered prohibitive to successful RSAs. Both parties indicated that trust is a critical component of agreements between pharmaceutical companies and payers. It is imperative that both parties trust the data: clear agreements on data validation and analysis are important to create trust in the data.

Certain types of agreements can also be problematic. For instance, manufacturers expressed that population-based agreements are perceived to be risky because there are many unknowns around compliance, prescribing, and so forth. Manufacturers are reluctant to take on risk when they cannot predict how their product will be used in the population. Agreements that involve the manufacturer paying for nonpharmaceutical costs are difficult to execute, as payers do not generally have the systems or data to support such agreements. Both parties shy away from agreements in disease areas where there are many different treatment paradigms or the relevant outcome is an intermediary outcome, because it can be challenging to attribute the outcome to the product in question.


Future Prospects: Barriers, Health Reforms, and Policy

This study confirms that very few private sector RSAs have been implemented in the United States; while payers and pharmaceutical companies remain interested in these types of agreements, various challenges restrict the types of situations in which they can be feasibly employed. Also, because of the effort required, payer and pharmaceutical respondents are less enthusiastic about outcomes-based agreements and more optimistic about simpler, financial-based agreements.

Although the global growth in RSAs seems to have slowed, several countries maintain robust programs, particularly Italy and Sweden, and interest is growing in Latin America and Asia. There has also been a broad shift to financial-based agreements for several reasons. Our research suggests that public payers, especially outside the United States, are attracted to making arrangements with manufacturers, first and foremost, to obtain an effectively lower price in a world where reference pricing and the prospect of parallel trade make differential (or tiered) pricing difficult. And, of course, this can benefit patients by providing earlier and broader market access. Second, few countries have an adequate data infrastructure to operate outcomes-based schemes efficiently.

The history of RSAs in the United States is dominated by the Medicare experience with CED. Although the interest remains, it seems to have waned. The growth in visible private RSAs in the United States seems to have stalled, but our interviews suggest growing interest and some new activity. There are multiple barriers in the United States—most prominently, the additional effort needed to negotiate and maintain these agreements relative to traditional rebates. The challenge of measuring individual-level outcomes in a claims-oriented data infrastructure makes operationalizing RSAs difficult because of the lack of relevant clinical outcomes contained in these data. Medicaid best price (and the similar 340B Drug Pricing Program) provisions, which link mandated discounts for public sector programs to private sector prices, are considered complications, but would seem to be manageable in a well-designed contract; notwithstanding, several interviewees regarded this as a major barrier.

If a medicine covered by an RSA does not perform as anticipated by the manufacturer and a price discount ensues, the reduced prices could be perceived as a new best price and made available to all Medicaid purchasers. In the case of Medicare, we were told that provisions around the Medicare 5-star rating program, which ties payment to achievement of certain quality metrics in health plans, have made adherence programs—a kind of outcomes-based program—attractive to payers. The preference for a short-term horizon of 18 months to 3 years being the most practicable arrangement in the US private health system, because it reduces long-term liability for manufacturers and payers, and limits the feasibility of RSAs in some disease areas.

Our interviewees were generally pessimistic as to whether the growth of ACOs would have any positive impact in the near term, since many ACOs are in the initial development and market experimentation phase11; however, they may well bring a new orientation to risk-sharing that will support the future development of pharmaceutical RSAs.

The ISPOR PBRSA Task Force emphasized that better information about what works in medicine is a global public good,1 but it still appears that the RSAs being developed in the United States will be confidential ones, with the knowledge gained only shared inadvertently or sporadically, rather than by design. Both payers and manufacturers have competitors, and they have some incentive to be “free riders” rather than developing innovative pricing schemes that yield knowledge on best medical practice. One of our payer interviewees—a national medical director for a major US payer—made this revealing and somewhat encouraging comment:

“If we learn something about a pharmaceutical by looking at our own data and we decide that we are going to use that information to make coverage determinations, it is our policy that we make that public (publish in a peer-reviewed journal). If the coverage decision is based on an economic analysis, that may be kept private; however, if the decision is based on something clinical, it has to be available for physicians and patients to evaluate.”

This suggests an important dichotomy between clinical and economic evidence, though they clearly become related when combined in a cost-effectiveness ratio or other assessment of value. It is not clear if this distinction is sustainable given that the recent joint American Heart Association and American College of Cardiology Task Force on Value and Cost called for consideration of cost-effectiveness in establishing clinical treatment guidelines in cardiology.12

The growing emphasis on comparative effectiveness research in the United States, including the establishment of the Patient-Centered Outcomes Research Institute,13 are testimony to the fact that the country is investing more in generating real-world evidence on clinical outcomes and their related economic implications. In principle, RSAs will generate some of this information, but if the results remain confidential, the new knowledge will, at best, slowly diffuse through a healthcare system that aspires to become a “learning healthcare system.” This raises the question of the need for greater public policy intervention. The following question was not part of our remit in this study, but we should be asking: Are there other policy tools or incentives that could be used to encourage and leverage US private sector RSAs to reveal their lessons for the greater good of the system and all patients?


There are a number of limitations to this study. First, there is the possibility that the database reviewed may not include the entirety of RSAs due to the confidential nature of agreements, resulting in an underestimation of the total number of RSAs in the United States. However, our interviews did not suggest a significant growth in the number of RSAs that would contradict the findings of the database review.

Additionally, the interviews and survey had a relatively small sample size, and we leveraged a convenience sample for both approaches; as a result, there is the possibility that our findings may not be generalizable to the entire US market. We attempted to mitigate this risk by including individuals from a number of organizations that might bring varying perspectives.

Due to the confidential nature of agreements and limited number of agreements in the United States, we have few data points to learn from. Thus, it remains to be seen how some of the challenges and opportunities identified will be realized in actual practice.

Finally, we sought to assess the potential for increased use of RSAs in the United States given the shifting incentives in the healthcare system with healthcare reform and the growth of ACOs. However, many of the forthcoming changes have yet to take effect, and until these have been fully implemented, it is challenging to assess whether RSAs may in fact have a great role in the future.


In summary, there is continued and even growing interest on the part of both manufacturers and payers in RSAs in the United States. Yet, the number of new agreements is still small—mostly exceptional situations. We can ask, “What are the necessary conditions for RSA adoption in the United States?” and the answer seems to be that more robust infrastructure and optimized RSA development and monitoring processes are needed. There is a lot of talk, but improved data systems and changed incentives (via health reform and ACOs) may generate more action.


The authors would like to thank the anonymous interviewees and survey respondents who generously shared their expertise, insights, and time, and the National Pharmaceutical Council for providing the funds to conduct this research.

Department of Pharmacy, University of Washington (LPG, JJC, PSB, SDS), Seattle, WA; VeriTech Corporation (LPG, JJC, SDS), Mercer Island, WA; Office of Health Economics (AT), London, UK; Director of the Center of the Evaluation of Value & Risk in Health, Tufts Medical Center - Institute for Clinical Research & Health Policy Studies (PJN), Boston, MA; National Pharmaceutical Council (KW, RWD), Washington, DC.

Author Affiliations:

Source of Funding: This research was supported by the National Pharmaceutical Council through a contract with VeriTech Corporation.

Author Disclosures: Dr Bajaj has received payment for services related to data collection, analysis, and preparation for this manuscript. Dr Carlson has been a consultant to Genentech, Pfizer, and Bayer; his employer, the University of Washington, maintains a subscription-based web-enabled database on risk-sharing agreements. Ms Westrich and Dr Dubois are employees of the National Pharmaceutical Council, an industry-funded health policy research group that is not involved in lobbying or advocacy. Dr Neumann is a board member for Merck, Takeda, Bayer, Novo Nordisk, Pacira, and Genentech; and is a consultant for Boston Health Economics and Purdue. Mr Towse has previously received honoraria for an ISPOR conference short course. Drs Sullivan and Garrison report no relationship or financial interest with any entity that would pose a conflict of interest with the subject matter of this article.

Authorship Information: Concept and design (LPG, JJC, SDS, AT, KW, RWD); acquisition of data (LPG, PSB, JJC); analysis and interpretation of data (LPG, PSB, JJC, SDS, PJN, AT, KW, RWD); drafting of the manuscript (LPG, PSB, JJC, PJN, KW, RWD); critical revision of the manuscript for important intellectual content (LPG, JJC, AT, SDS, PJN, KW, RWD); obtaining funding (LPG); administrative, technical, or logistic support (PSB); and supervision (LPG, JJC).

Address correspondence to: Louis P. Garrison, Jr, PhD, Pharmaceutical Outcomes Research & Policy Program, University of Washington School of Pharmacy, Box 357630, 1959 NE Pacific St, H-375A, Seattle, WA 98195. E-mail:


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