Chapter 12: Adapting Payers’ and Producers’ Incentives to Drug Repurposing

As healthcare costs increase, new and sustainable solutions to develop and fund treatment options for patients are paramount. Drug repurposing could offer one such solution, but requires a re-think and adaptation of payers’ and producers’ incentives. In this chapter we describe the considerations of payers, and how these translate to signals for research and development by producers. Payers can send the right signals to incentivise drug repurposing through value-based models of payment, but health systems differ in their willingness and ability to support indication-based pricing. For off-patent/generic drugs, alternative models of funding may be needed. We also elaborate a business model that exchanges some of the profit motives with the prioritisation of medical value. The two approaches described in this chapter are drawn on ways to influence the price for repurposed drugs (a ‘pull’ mechanism) and ways to disincentivise the existing model, which is increasingly recognised as too expensive and inefficient (a ‘push’ mechanism).