Approval by the Food and Drug Administration (FDA) is a significant milestone in a drug’s life cycle. Upon approval, patients can begin using the therapy, and manufacturers can start to earn revenue. But FDA approval does not guarantee immediate or widespread drug availability to patients. Health benefits coverage is critical to unlocking market access.
Health insurers typically make coverage decisions by looking at some combination of clinical guidelines, safety profiles, alternative treatments, cost, and cost effectiveness. For Medicare and Medicaid, the Centers for Medicare and Medicaid Services make prescription drug coverage decisions, which strongly influence Managed Medicaid, Medicare Advantage, and Medicare Part D Prescription Drug formularies. Comparatively, each private insurer has its own approval criteria, with pharmacy benefit managers (PBMs) also playing varying roles.
Pharmaceutical companies undertake extensive commercialization planning to help ensure patients have access to new drugs. The companies focus on initiatives such as insurer and PBM contracting and provider education. However, many overlook the powerful influence of clinical trial design—especially Phase 3 clinical trials—on coverage decisions, which can impact commercial uptake, reimbursement success, and revenue.
Here are five key Phase 3 clinical trial considerations that can impact payers’ coverage decisions for treatments after FDA approval.
1. Broad trial populations can weaken a new drug’s coverage prospects
Designing a trial for the broadest possible patient population may help with FDA approval but can also weaken the drug’s perceived efficacy or cost effectiveness. If results vary too much across patient groups, insurers may restrict coverage to higher need subpopulations where the benefits are more evident. A larger eligible population also raises cost concerns, which can lead insurers to impose coverage limitations.
2. Clinical trial inclusion criteria can influence patient eligibility for drug coverage
Even if the FDA approves a product for a broad patient population, health insurance companies may limit coverage to a subset of members. Insurers frequently base such requirements on clinical trial inclusion criteria. For example, if specific diagnostic tests or biopsies are required to enter a trial, these tests may become part of carriers’ coverage criteria. If patients are required to demonstrate a certain severity of disease or to have lived with the disease for a minimum amount of time to participate in a clinical trial, carriers may similarly require patients to meet these criteria for coverage.
3. Step therapy requirements in drug trials often carry over to health insurer coverage decisions
Insurers often require patients to try and fail one or more "preferred" or lower cost drugs before approving coverage for newer, more expensive, or brand name medications. This practice is called step therapy, step protocol, or fail first requirements. If a clinical trial requires patients to try and fail a different regimen before inclusion, carriers may mirror that requirement in their step therapy rules. Prior treatment requirements should be considered carefully when designing Phase 3 clinical trials.
4. Health insurers use clinical trial response criteria to measure a drug’s treatment success
Carriers may later use criteria for meaningful response in clinical trials to establish rules for continuation of treatment. Requiring tests during trials that can only be administered by certain providers or in specific clinical settings may create downstream challenges for patients and providers, who may need to secure access to and pay for those tests in real world settings. The frequency of these tests in the clinical trial could also be used to establish the cadence for carriers’ retesting requirements. Including multiple secondary endpoints can help providers show positive effects in different ways during coverage reviews.
5. Health insurers may restrict drug coverage to trial-like sites of care
Clinical trials are often conducted by disease specialists at specific, specialized sites of care, such as major research hospitals or disease centers of excellence—especially when treatments require advanced skills to administer safely. Insurers frequently mirror these trial settings in their coverage policies, limiting reimbursement to certain specialist or facility types. These restrictions may also apply to pretreatment requirements, such as diagnostic workups.
Carriers may also enact special provider networks for specialized care, such as cell and gene therapies. These networks tend to be significantly smaller than their usual provider networks and may not overlap with centers of excellence or other provider certification programs run by the manufacturers.
Another site-of-care consideration is whether the drug is administered as part of an inpatient stay, such as an infusion related to acute myocardial infarction. Most carriers reimburse hospitals for inpatient stays using diagnosis related group bundled payments—meaning hospitals, not insurers, control access through their own formulary reviews. Coverage decisions shift from insurers to hospital pharmacy and therapeutics committees in these cases.
Final thoughts on how clinical trial design can help lead to market success for new drugs
Most trials are designed with a focus on FDA approval, but trial design also shapes insurer coverage. Phase 3 decisions—such as endpoints and patient selection—can influence coverage limits, step therapy, or site-of-care restrictions. Understanding the factors that influence payers’ coverage decisions can help reduce access hurdles and smooth the path to market after approval.