Leading stakeholders from across the cancer care ecosystem met in New York City for the annual Association for Value-Based Cancer Care (AVBCC) 2026 Summit, held October 7-9, 2026. Attendees included drug manufacturers, pharmacy benefit managers (PBM), clinicians and healthcare organizations, health policy advocates, consultants, and legal professionals including Frier Levitt. The Summit featured dozens of presentations examining evolving issues in health policy, reimbursement, contracting, oncology specialty pharmacy, practice management, transparency, and value-based care. While each presentation offered distinct perspectives, several recurring themes emerged, including drug pricing transparency, direct-to-employer contracting, innovative pharmaceutical contracting models, and PBM reform.
Price Transparency and Its Relationship with Value
The concept of price transparency in prescription drug pricing has drawn both praise and criticism. Some believe that price transparency stifles competition by exposing the various markups, rebates, chargebacks, and other commercially sensitive price concessions to the broader market. For example, manufacturers and PBMs often negotiate deep discounts and rebates off the wholesale acquisition cost (WAC) for select drugs to secure favorable placement on PBM formularies. If disclosure of negotiated discounts was required, manufacturers may be less willing to discount the cost of their drugs, and drug prices could converge to a higher floor.
However, proponents of price transparency argue that manufacturers inflate their list prices in anticipation of offering substantial discounts and rebates to secure favorable placement on PBM formularies. These markups, proponents say, distort the true cost of prescription drugs and cause patients to pay more in coinsurance than they otherwise should.
Many participants agreed that tackling the rising cost of prescription drugs requires an understanding of the competing incentives among manufacturers, PBMs, payors, and patients. Several speakers encouraged self-funded employers to scrutinize their PBM arrangements, question their PBMs’ and brokers’ compensation, and demand data to help determine whether PBMs are, in fact, passing through the rebates they negotiate. Without this information, payors will never fully understand the elaborate tapestry that is prescription drug pricing, and whether their total cost of care is reasonable in relation to the quality of care delivered.
The Emerging Trend of Direct-to-Employer Contracting
Daniel Frier, Co-Founding Partner of Frier Levitt, participated in a panel discussion exploring the growing opportunities for direct-to-employer (DTE) contracting in cancer care management. With cancer care representing a significant driver of high-cost healthcare claims, self-insured employers are increasingly exploring alternatives to traditional healthcare purchasing models. DTE contracting offers a potential solution by allowing employers to establish direct relationships with healthcare providers and specialized intermediaries to secure high-quality care at sustainable costs.
The discussion also addressed key considerations in structuring DTE arrangements, particularly provider reimbursement and data rights. While employers may benefit from greater visibility into treatment costs, care delivery, and patient outcomes, providers must ensure that these arrangements offer appropriate reimbursement and access to their patient data. Balancing these interests is critical to developing financially sustainable contracting arrangements that benefit both employers and providers.
Safe Harbor Drug Contracting: Exploring Alternatives to Traditional Rebates and Discounts
Arielle Miliambro, Partner at Frier Levitt, participated in a panel discussion examining how federal Anti-Kickback Statute (AKS) safe harbors may facilitate innovative drug contracting arrangements that promote transparency, share financial risk, and prioritize patient outcomes. The discussion explored the evolving regulatory framework governing pharmaceutical contracting, including federal safe harbors and the opportunities and challenges associated with value-based contracting. Panelists examined the Discount Safe Harbor, Warranty Safe Harbor, and regulatory protections for certain value-based arrangements, highlighting how these frameworks may support alternatives to traditional rebate and discount structures. Despite these opportunities, adoption of innovative contracting models has remained limited due to regulatory restrictions, enforcement uncertainty, and the challenges of allocating financial risk among manufacturers, payors, and providers.
Transparency and the alignment of financial incentives with clinical outcomes remain critical to the success of these arrangements. Successful value-based contracting requires collaboration among manufacturers, providers, and payors, along with clearly defined measures for evaluating clinical outcomes and allocating financial risk.
However, value-based contracting is not necessarily a one-size-fits-all solution. Its feasibility depends on factors such as the nature and cost of the drug, the ability to measure clinical outcomes, and the timeframe over which those outcomes can be assessed. Traditional rebates may continue to serve a role in pharmaceutical contracting, while innovative risk-sharing models offer opportunities to improve accountability and better align financial incentives with patient care. Broader adoption will depend on greater regulatory clarity, transparency, and collaboration among industry stakeholders.
The Impact of PBM Enforcement Activity and Federal Legislation on PBM Contracting
Since the Federal Trade Commission’s settlement with Express Scripts, Inc. (ESI) in February of 2026, there has been considerable speculation about how, if at all, the settlement might change PBM behavior. Among other things, the settlement requires that by January 1, 2028, ESI move its standard offering for retail community pharmacies to a model based on actual acquisition cost plus a dispensing fee. Because this requirement applies to “retail community pharmacies,” defined as pharmacies with three or fewer locations, many at the Summit believed the settlement would provide virtually no relief for independent specialty pharmacies dealing primarily with high-cost drugs and inadequate reimbursement. While the ESI settlement was viewed as a step in the right direction, many believed it failed to fully address critical issues surrounding the exorbitant cost of cancer care.
The Pharmaceutical Care Management Association (PCMA), the national trade association for PBMs, and Prime Therapeutics, one of the largest PBMs in the nation, also discussed how new laws, particularly the 2026 Consolidated Appropriations Act, 2026 (CAA) will disadvantage “disrupter” PBMs that compete with the big three: CVS Caremark, Express Scripts, and Optum Rx. Their theory is that by delinking PBM compensation from the list price of drugs, and limiting that compensation to “bona fide service” fees, the CAA will force all PBMs to compete based on the services they provide as opposed to the reimbursement offered.
Experts in PBM economics predicted that buyers of PBM services (e.g., payors and employer-sponsored plans) will likely question whether they should pay for those services at all. Frier Levitt’s Co-Founder and Partner, Jonathan Levitt, explained that even the most sophisticated self-funded employers still have no understanding of the PBM contracts that govern the administration of their benefit plans and the data flowing between manufacturers, wholesalers, pharmacies, PBMs, and little-known “rebate aggregators” affiliated with PBMs. Jonathan urged employers to closely review their PBM arrangements, broker compensation, and the data driving their cost of care.
Indeed, under the Employee Retirement Income Security Act of 1974 (ERISA) self-funded employers are fiduciaries responsible for ensuring they get the best value possible for their membership. Failure to exercise appropriate oversight may expose responsible fiduciaries to legal and financial risks.
Looking Ahead
The Summit highlighted how evolving drug pricing practices, PBM regulation, and innovative contracting models could influence national healthcare policy and the delivery of cancer care. Whether you are a payor troubled by the cost of cancer drugs, a manufacturer responsible for setting the price of those drugs, or a provider fighting for fair reimbursement, all stakeholders must be prepared for significant legal and regulatory changes that will inevitably impact the cancer care continuum.
How Frier Levitt Can Help
Frier Levitt advises healthcare providers, specialty pharmacies, pharmaceutical manufacturers, payors, and other stakeholders on the legal, regulatory, and contracting challenges shaping cancer care. Our attorneys assist with PBM contracting and disputes, reimbursement matters, regulatory compliance, and innovative healthcare contracting arrangements. Contact Frier Levitt to discuss these trends and how our team can help your organization navigate the evolving healthcare landscape.
