BACKGROUND: The introduction of innovative specialty pharmaceuticals with high 
prices has renewed efforts by public and private healthcare payers to constrain 
their utilization, increase patient cost-sharing, and compel government 
intervention on pricing. These efforts, although rational for individual payers, 
have the potential to undermine the public health impact and overall economic 
value of these innovations for society. The emerging archetypal example is the 
outcry over the cost of sofosbuvir, a drug proved to cure hepatitis C infection 
at a cost of $84,000 per person for a course of treatment (or $1000 per tablet). 
This represents a radical medical breakthrough for public health, with great 
promise for the long-term costs associated with this disease, but with major 
short-term cost implications for the budgets of healthcare payers.
OBJECTIVES: To propose potential financing models to provide a workable and 
lasting solution that directly addresses the misalignment of incentives between 
healthcare payers confronted with the high upfront costs of innovative specialty 
drugs and the rest of the US healthcare system, and to articulate these in the 
context of the historic struggle over paying for innovation.
DISCUSSION: We describe 3 innovative financing models to manage expensive 
specialty drugs that will significantly reduce the direct, immediate cost burden 
of these drugs to public and private healthcare payers. The 3 financing models 
include high-cost drug mortgages, high-cost drugs reinsurance, and high-cost 
drug patient rebates. These models have been proved successful in other areas 
and should be adopted into healthcare to mitigate the high-cost of specialty 
drugs. We discuss the distribution of this burden over time and across the 
healthcare system, and we match the financial burden of medical innovations to 
the healthcare stakeholders who capture their overall value. All 3 models work 
within or replicate the current healthcare marketplace mechanisms for 
distributing immediate high-cost events across multiple at-risk stakeholders, 
and/or encouraging active participation by patients as consumers.
CONCLUSION: The adoption of these 3 models for the financing of high-cost drugs 
would ameliorate decades-long economic conflict in the healthcare system over 
the value of, and financial responsibility for, drug innovation.