Contracts with commercial entities often include discount and/or rebate provisions intended to help pharma manufacturers secure a better position on the commercial company’s Preferred Drug List (PDL). Provisions in agreements become quite complex due to the creativity of the pharma company market access teams. Be sure to carefully model the financial impact of these agreements so that there is a solid understanding of the range of potential impact they will have on your growth, profitability and cash flow.
Build a database that incorporates the specific terms of all commercial contracts. Many have stiff penalties for late payments of discounts or rebates. Each one will normally have either monthly or quarterly reconciliation cycles. Additionally, build an SOP tailored to commercial contract rebate and discount reconciliation and payments; follow it and audit the work.