PharmExec Blog

Physicians in ACOs Dare Pharma to Step up Its Game

Pharma, according to physicians currently embedded within Accountable Care Organizations (ACOs), is not living up to its potential. A survey conducted by Oliver Wyman has most of its 200 respondents saying the industry could play a more active role with value-based healthcare providers in helping to deliver better care at a lower cost, but it does not and probably won’t, by most expectations.

These responding physicians, of whom 25% of their income is based on value-based care arrangements, encourage drug companies to step in and deliver the kind of data necessary to offer competitive care quality with lower price tags.  In fact, 61% agreed or strongly agreed that if and when properly implemented, branded drug therapies could serve an increased role in reducing the cost of patient care. And yet only 37 percent agreed with the statement that “Pharmaceutical companies have the capabilities to reduce the total cost of care and improve patient outcomes.”

Mark H. Mozeson a partner at Oliver Wyman points out that most contracts between ACOs and payers do not factor in drug expenditure, but that is expected by many to change soon. “And as it does,” he says, “drug makers will have the opportunity in many cases to move away from negotiating unit price with commercial health plans and instead contract directly with providers based on outcomes and ability to manage total disease costs.”

Indeed, pressure is expected to increase on drug companies to get chummy with ACOs as they become an increasingly substantial component to the American healthcare system. As Mozeson concludes, “Their ability to demonstrate value will determine whether they have a seat at the table.”

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