Innovative Contracting: Use Of Complex Managed Entry Agreements

Abstract

Simple managed entry agreements (MEAs) (e.g. finance-based) for high-cost pharmaceuticals in cost-constrained markets have existed for decades. However, efforts to balance remuneration for innovation with limited healthcare funds has led to an increase in complex MEAs (e.g. risk-sharing agreements). This study examined the current prevalence of MEA types for twelve countries, and willingness within these countries to adopt complex MEAs going forward. Using secondary research, prevalence and types of MEAs were analyzed in twelve countries across Europe, North America, Latin America and Australasia, while primary interviews with US and EU5 payers focused on historical and current use of MEAs and on willingness to adopt complex MEAs. Trends based on geography, pharmaceutical market size and common factors, such as entrenched HTA usage, were isolated, and potential roadblocks and barriers for further global complex MEA adoption were analyzed. Of the twelve countries examined, Italy, Sweden, Australia, and the UK exhibit high prevalence of MEAs, and those countries also had either a high prevalence of current complex MEA use or willingness to adopt complex MEAs in the future. Among Canada, the US, France and Poland, there is medium-level MEA prevalence, with still strong willingness to adopt complex MEA types. However, low prevalence of MEAs is shown in Brazil, South Korea, Germany, and Spain, with all four countries reluctant to adopt complex schemes. This geographic distribution shows that while Europe is the current leader in MEA use, global MEA prevalence and willingness to adopt complex MEAs are on the rise. The main barriers to MEA adoption include the administrative and cost burden of monitoring, and lack of necessary infrastructure. European and other countries and industry have been using MEAs to mutually beneficial effect for some time, and the prevalence is growing globally. The use of complex MEAs is increasing rapidly in Europe and beyond.