Pay-for-performance or value-based pricing would change that. It would tie payments for prescription drugs to their effectiveness, whether they did what they were designed to do.

How well do medications for high blood pressure or cholesterol, for example, keep patients in healthy ranges for each? How well do medications control symptoms of autoimmune diseases? How much do cancer drugs extend life? And how much do the drugs save the health care system by enabling patients to avoid medical treatments they no longer need?

The Pharmaceutical Research and Manufacturers of America, which represents biopharmaceutical research companies, did not respond to requests for comments about value-based pricing of prescription drugs.

The concept is being tried in other parts of health care. Under the Affordable Care Act, for example, hospitals face financial penalties if too many previously hospitalized patients are readmitted, a provision intended to encourage hospitals to provide better follow-up medical care.

http://www.governing.com/topics/health-human-services/sl-drug-prices-performance-pay.html