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Trump Explores ‘Money Back Guarantee’ On New Drugs

Prescription drugs with US dollar to indicate medicine is very expensive

If you’re in the process of pharmaceutical brand planning for a new launch which could enter the US market, you may be paying attention to remarks from the Trump administration with interest – in particular to do with ‘money-back’ guarantees arranged with drug companies.

The more formal name for such an agreement is an ‘outcome-based contract’, in which drug companies might refund money if patients don’t react to their drugs as expected.

The goal behind the idea is for the government to save money on drug expenditure – not on the drugs that do work necessarily, but on unnecessary expenditure on drugs which don’t deliver.

According to Pacific Standard magazine, the US government was presented with the idea back in January by drug executives, and the idea was discussed in meetings last month. With a prerogative to stop drug prices spiralling out of control, there’s a chance this could be trialled in the US.

However, history doesn’t side with the idea necessarily. Over a decade ago, the Italian government asked pharmaceutical companies to give money back to the national health system if their drugs did not deliver on what they promised, but the scheme was not a successful one back then.

Yet now, the drugs companies are suggesting the scheme, so could the outcome be different? For the drug companies, it’s a sales tool allowing them to promise security for anyone making an investment, yet the real issue comes in for any drugs which don’t pass the set measures.

If this becomes a industry standard, there’s a chance that companies won’t take a risk on certain drugs, but all those they do put out will have full confidence of the company.